P L D 2000 Federal Shariat Court1
Before Mian Mahmoob Ahmed, CJ. Dr. Fida Muhammad Khan and Ch. Ejaz Yousaf JJ
ALLAH RAKHA and others‑‑‑Petitioners
Versus
FEDERATION OF PAKISTAN and others‑‑‑Respondents
Shariat Petitions Nos.29/I, 32/1, 37/1, 42/1, 13/L of 1993, 3/I, 28/1, 6/L, 10/L, 11/L of 1994, 15/I, 18/1, 19/I, 5/L, 7/1 of 1995, 3/I, 4/I, 6/1, 10/I, 11/1, 13/I of 1996, 10/I, 4/L, 14/I of 1997, 10/I, 1/L, 2/L of 1998, 14/1, 16/1, 26/1 of 1994, 2/P, 2/1 of 1996, 4/I of 1994, 7/1, 27/1, 21/1 of 19()5 and 11/I of 1998, decided on 5th January, 2000.
(a) Muslim Family Laws Ordinance (VIII of 1961)‑‑‑
‑‑‑‑Preamble‑‑‑Historical background of promulgation of Muslim Family Laws Ordinance, 1961.
(b) Constitution of Pakistan (1973)‑‑‑
‑‑‑‑Arts. 203‑B(c) & 203‑D‑‑‑"Law"‑‑‑Definition as provided in Art.203B(c) of the Constitution‑‑‑Jurisdiction of Federal Shariat Court and Shariat Appellate Bench‑‑‑Scope‑‑‑Ouster of the jurisdiction of Federal Shariat Court and for that matter of the Shariat Appellate Bench of the Supreme Court of Pakistan in the case of Mst. Kaniz Fatima PLD 1993 SC 901 was not as regards the provisions of the Muslim Family Laws Ordinance but was referable to Muslim Personal Laws of particular sects.
Mst. Kaniz Fatima's case PLD 1993 SC 901 ref.
(c) Constitution of Pakistan (1973)‑‑‑
‑‑‑‑Art. 203‑G‑‑‑Bar of jurisdiction‑‑‑No Court or Tribunal including the Supreme Court of Pakistan and a High Court, shall entertain any proceedings or exercise any power or jurisdiction in respect of any matter within the power or jurisdiction of the Federal Shariat Court‑‑‑Question as to whether the Federal Shariat Court has the jurisdiction or trot is the one which is within its domain and can be decided by it and final verdict in this regard would be that of the Shariat Appellate Bench of the Supreme Court of Pakistan.
Zaheer‑ud‑Din and another v. The State 1993 SCMR 1718 ref.
(d) Constitution of Pakistan (1973)‑‑‑
‑‑‑‑Arts. 203‑B(c) & 203‑D‑‑‑"Law"‑‑‑Definition‑‑‑Jurisdiction of Federal Shariat Court‑‑‑Scope‑‑‑Provision of codified laws/statutes covering the general Muslim Population of the country would be open to question before the Federal Shariat Court so as to examine their validity on the touchstone of Injunctions of Islam and only Muslim Personal Laws relating to a particular sect cannot be questioned before Federal Shariat Court.
(e) Constitution of Pakistan (1973)‑‑‑
‑‑‑‑Art. 203‑D‑‑‑Muslim Family Laws Ordinance (VIII of 1961), Ss.4, 5, 6 & 7‑‑‑Repugnancy to Injunctions of Islam‑‑‑Federal Shariat Court has the jurisdiction to examine whether Ss.4, 5, 6 & 7 of the Muslim Family Laws Ordinance, 1961 are violative of the Injunctions of Islam or not.
(f) Islamic Jurisprudence‑‑‑
‑‑‑‑Ijtihad‑‑‑Sources of Muslim Laws: Holy Qur'an; Sunnah; Ijma and Qias‑‑‑Object‑‑‑To find a solution of a problem or resolve a question said sources of Islam have to be resorted to in the order of priority‑‑‑All other sources of Muslim Laws are subordinate to the Injunctions of Qur'an and Sunnah‑‑‑Reliance on "Istehsan" and "Qias" or for that matter on Ijma cannot be placed so as to transgress the limitations imposed by the Holy Qur'an and Sunnah‑‑‑"Ijtehad" cannot be so liberalized as to even remotely violate any Qur'anic Injunctions or Sunnah which is, in fact, the best Tafseer‑‑Interpretation of Holy Qur'an itself‑‑‑No worldly law can be better than the law of Allah Almighty.
There are 4 sources of Muslim Laws viz, (1) Holy Qur'an;
(2) Sunnah of the Nabi‑e‑Karim;
(3) Ijma (Consensus); and
(4) Qias (Reason by analogy)
It may, however, be kept in mind that Imam. Abu Hanifa has also opined that doctrine of Istehsan is another valid source of Muslim Law. Similarlv Malkia have enunciated (----------) (public interest) as a source of Muslim Law compatible with the doctrine of Istehsan. According to "Islami Usool Fiqh", to find a solution of a problem or resolve a question the above sources of Islam have to be resorted to in the order of priority. It must, however. Se always kept in mind that all other sources of Muslim Laws are subordinate to the Injunctions of Qur'an and Sunnah. Reliance on "Istehsan" and Qias or for that matter on Ijma cannot be placed so as to transgress `the limitations imposed by the Holy Qur'an and Sunnah.
The lever of Ijtehad in the hands of Ummah, no doubt, has been bestowed upon it to keep the Ummah in pace rather in advancement of the modern situations prevailing at a particular time, be those in relation to sciences, technology, literature, social conditions or cultural activities but it cannot be lost sight of that "Ijtehad" cannot be so liberalized as to even remotely violate any Qura'nic Injunction or Sunnah of Nabi‑e‑Karim (s.a.w.) which Sunnah is, in fact, the best Tafseer‑interpretation of Holy Qur'an itself. Departing from the above principle of "Ijtehad" would obviously lead the Ummah to degenerative process and must at all costs be deprecated and discouraged. Legal maxim of Shariah in the above connection is (Where there is a decisive and clear cut text, there no question of Ijtehad arises.
Islam as universally acknowledged is a "Deen" and not merely a religion. It being a code of life the Qura'nic Injunctions and the Sunnah of Nabi‑e‑Karim (s.a.w.) which is the best Tafseer‑intepretation of Qura'nic Injunctions covers all aspects of life and whatever has been in junctively and by command given thereby cannot be deviated from at any point of time. It must be always Larne in mind that no worldly law can be better than the law of Allah Almighty:
Trimizi, Vol. IV, p.556, Haidth No.1342 and Majallatul Ahkamil Adlia, section 14 ref.
(g) Islamic Jurisprudence‑‑‑
‑‑‑‑Ijtehad‑‑‑Applicability‑‑‑Principles‑‑‑Ijtehad is permissible only where there is no Qur'anic Injunction and if there is any ambiguity to be cleared of clarification needed then resort shall have to be made to Sunnah first.
(h) Muslim Family Laws Ordinance (VIII of 1961)‑‑‑
‑‑‑‑S. 4‑‑‑Constitution of Pakistan (1973), Art.203‑D‑‑‑Succession‑‑Repugnancy to Injunctions of Islam‑‑‑Provision contained in S.4, Muslim Family Laws Ordinance, 1961, as presently in force, is repugnant to the Injunctions of Islam‑‑‑Federal Shariat Court directed the President of Pakistan to take steps to amend, the law so as to bring the said provisions in conformity with the Injunctions of Islam‑‑‑Provisions of S.4, Family Laws Ordinance, 1961 which have been held repugnant to the Injunctions of Islam shall cease to have effect from 31st day of March, 2000‑‑‑Plausible solution to meet the socio‑economic problems of orphan grandchildren was also suggested by the Federal Shariat Court.
There is neither any ambiguity nor any clarification needed as regards devolution of inheritance and persons to inherit as also about their shares. In the line of inheritance prescribed by Qur'an in the presence of son, the children of the predeceased children have been excluded as heirs and this position has been aptly taken care of by the Sunnah of our Holy Prophet Muhammad (peace be upon him) in the Ahadith in which the precise position of the grandchildren has been elucidated that the grandchildren are to be considered as one's children in the distribution of inheritance in case none of one's own children are still alive and grandson has been excluded from inheritance simultaneously with the son of the propositus. This Haidth has been followed by all schools including Fiqa‑e‑Jafria.
Bringing of section 4 on the statute book viz. Muslim Family Laws Ordinance, 1961 was the result of the recommendations of the Commission on Marriage and Family Laws appointed by the Government of Pakistan in 1956 which Commission gave its report. The recommendations of the Commission based on the "so‑called Ijtehad" was a futile exercise which has caused confusion in the law of inheritance envisaged for the Muslim Society by mandate of the Holy Qur'an.
The Commission in this respect framed a question as under: ‑‑
"Is there any sanction in the Holy Qur'an or any authoritative Hadith whereby the children of a predeceased son or daughter are excluded from inheriting property?"
There is a very short discussion on this issue in the Commission Report. At page 1222 of the Gazette it has been stated: ‑‑
"It was admitted by all the members of the Commission that there is no sanction in the Holy Qur'an or any authoritative Hadith whereby the children of a predeceased son or daughter could be excluded from inheriting property from their grandfather. It appears that during (---------) this custom prevailed amongst the Arabs, and the same custom has been made the basis of the exclusion of deceased children's children from inheriting property of their grandfather. It may be mentioned that if a person leaves a great deal of property and his father has predeceased him, the grandfather gets the share that the father of the deceased would have got. This means that the right of representation is recognised by Muslim law amongst the ascendants. It does not, therefore, seem to be logical or just that the right of representation should not be recognized among the lineal discendants. If a person has five sons and four of his sons predeceased him, leaving several grant children alive, is there any reason in logic or equity whereby the entire property of the grandfather should be inherited by the son only and a large number of orphans left by the other sons should be deprived of inheritance altogether. The Islamic law of inheritance entails a grandfather to inherit the property of his grandsons even though the father of the testator has predeceased him; why can the same principle be not applied to the lineal descendants, permitting the children of a predeceased son or daughter to inherit property from their grandfather. There are numerous injunctions in the Holy Qur'an expressing great solicitude for the protection and welfare of the orphans and their property. Any law depriving children of a predeceased son from inheriting the property of their grandfather would go entirely against the spirit of the Holy Qur'an.
It was stated by Maulana Ehteshamul Haq that all the four Imams are agreed that the son of a predeceased son or daughter shall be excluded from inheritance. The Maulana Sahib was not prepared to re‑open this question in view of the unanimous opinion of all the Imams. The views of the Maulana Sahib would be elaborated by him in his note of dissent.
It has been suggested in some of the replies that the grandfather can, by will, leave one‑third of his property to his grandchildren. This provisions does not do full justice to the orphans as is evident from the example given above. We, therefore, recommend that legislation should be undertaken to do justice to the orphans in respect of the property of their grandfathers."
On this point the only Alain Member had disagreed as is apparent from the last but one para. of the above quotation. As regards the opening sentence of the above quotation where admitted position of all the members has been given out, the Alam Member in his note has recorded that this does not reflect the correct position.
The above formulation of the question in the manner framed misdirected the proceedings of the Commission. In the presence of the Ayaat of Surah Nisa the question to be framed required a positive frame and not negative as was done by the Commission. If the question had been framed so as to solicit views on the subject in the following form, the result might have been different:
"Are the children of a predeceased son or daughter entitled to inherit from the grandfather in the presence of a son of a propositus according to Qur'an and Sunnah?"
Unfortunately this was not done. Obviously in the presence of a positive direction that inheritance under the Islamic Law as derived from Quranic Verses being based on the principles of (---------) and (--------) and son being the (---------) if the grandson was to be included in the list of heirs the "father" would 'be equated with the "nearer" which would amount to interpolation in the Qura'nic Verses. This principle of Qura'nic Verse has been explained by the Hadith also which is in the following words: ‑‑
(Gazette of Pakistan, Extraordinary, August 30, 1965, pages 15571558)
In the presence of the above clear position regarding inheritance to devolve upon nearer (son) to the exclusion of farther (grandson) no verse was specifically required in Qur'an to exclude an orphan grandson from inheritance.
To re‑explain the position, the question for determination was and is whether the grandsons/daughters of a propositus whose parents have died during the lifetime of the propcsitus are included in the list of those entitled of inheritance under the Qura'nie Injunctions. Qura'nic Injunctions are of two types; directory and propitiatory. It is a matter of common sense otherwise also that in the presence of a mandatory injunction in respect of any matter no propitiatory provision would be required. The Ayaat of Qurane‑Hakeem on the subject of inheritance are mandatory, clear, explicit and, therefore, needed no propitiatory provision for any explanation. The emphasis in the Ayaat of Surah Nisa that the directions contained therein as regards inheritance in all respects have to be followed in letter and spirit and any deviation therefrom entails punishment of severe nature, establishes the absolute mandatory nature thereof.
Another factor which had been weighing with the learned members of the Commission and obviously with the framers of section 4 appears to be humane and compassionate consideration qua the orphans. The inheritance principles of Islam are not based on financial positions but as already stated are essentially based on nearness and close proximity of relations with the deceased whose estate is to be distributed, The above considerations of humane aspects and compassion, though of great importance, cannot be incorporated in it on account of immense complications and the various discriminatory positions that may emerge therefrom. For example if the orphan children of the predeceased children are to be included in the list of persons to inherit why not include the widows of the predeceased children or for that matter the children of the predeceased brothers and sisters etc. and if it be so done there will be no end to the inclusions. Again in the matter of compassion an orphan grandchild without any tangible asset with him should not be equated with another orphan grandchild who in his own right may be much better placed financially than even the direct heir i.e. a son of the propositus. In the context of the above position that can emerge and does exist in the ground realities, the human wisdom which, without any doubt, cannot equate with the wisdom of the Creator, should not be allowed to muddle up the scheme of inheritance laid down by the Holy Qur'an as it is bound to create confusion and choas rather than be of any comfort or solace to the fiber of the Muslim Society. On the plane of pure worldly considerations even, section 4 cannot be sustained. In order to meet situations of financial inequality in the society, it is not merely the law of inheritance ordained through Qur'an which should be tampered with but attempt should be made to create a social order which takes care of all the deprived members of the society. Will it not be better to cater for the needs of all the orphans in a respectable manner rather than care for only such orphans who are being allowed to inherit from propositus by virtue of section 4 alone?
The inclusion of the grandchildren in the inheritance from the grandfather, in the presence of the sons or daughters at the time the succession opens and to have per stripes a share equivalent to the share which such predeceased son or daughter would have received if alive is, therefore, nugatory to the scheme of inheritance envisaged by Qur'an. The children of predeceased son or daughter appear to have been purposely excluded and there appears to be a justification therefor that they are not to share the burdens ‑and responsibilities which a son as an heir would have to undertake on the demise of his father.
Examining the above aspect on the principles of other jurisprudences as well it may be observed that it is well‑settled even as regards the man‑made law that if in any such law there is manner and mode prescribed for doing anything in a particular manner it has to be done in the same manner only and in no other manner. It is also well‑settled that doing of anything in manner other than specifically provided for, will be wholly illegal and will have no effect whatsoever. If this principle is being adhered to as regards the man‑made law how can one think of deviating from the law of Allah which law is the base of all laws and there can be no other law better than that. Although there is no need to derive support from principles of any other jurisprudence to interpret law as contained in Qur'an but nevertheless the above view has been expressed just to satisfy those minds which are over influenced by philosophies of law other than that of Islam. It is also intended to bring home to all such thinkers that the philosophy of law contained in Qur'an is the most just and in consonance with all equitable principles that could possibly be conceived.
The next question to be examined is as to what would be the solution for the socio‑economic problem with which the orphan grand children may be confronted with on the demise of a grandparent, who may have left estate from which Uncles and Aunts would inherit but they would not, and thus, may have a sense of deprivation or for that matter confronted with economic problems.
Qur'an‑e‑Hakeem is the word of Allah Almighty who is the Creator of the Universe and who knoweth everything which none else can know and is the wisest. It will be presently shown that the solution for this problem is also available in the Holy Qur'an.
The Islamic Ideological Council in one of its reports on the subject of inheritance has recommended that the Uncles and Aunts of orphan grandchildren are duty bound to take care of their orphan nephews and nieces and provide for them. It has also been recommended that in the case of non-performance of this duty by Aunts and Uncles a legal obligation be cast upon them to abide by their duty. Probably the above recommendation is derived from Ayat 8 of Sura‑e‑Nisa which lays down that at the time of distribution of assets those next of kins and orphans and others, who are present, be also dealt with kindly. This is a direction for general application to all next of kins who are present at the time of distribution to be taken care of and not specifically for orphan grandchildren.
The above could be one of the solutions for the problem but this solution is not such which will be considered respectable in the social conditions of Pakistan inasmuch as in doing such type of a thing it is usually given out by the performer of the duty that he is doing it as a charity and those who receive anything under this arrangement have a feeling of inferiority and may have inhibition in taking something as a matter of charity. If the piety which is a requisite of an Islamic Social Order had been prevalent it could well have been a good solution but in the situations in which we are placed, the better solution would be the making of a law for
Mandatory will (---------) in favour of the orphan grandchildren. This view finds support from a Qura'nic Verse as well. Quran‑e‑Hakeem through Ayat 180 of Surah Baqara has ordained that it is prescribed that when death approaches near you, if he leaves any goods that he makes a bequest to parents and next of kins according to reasonable usage and this is due from the God‑fearing. This Ayat starts with a mandate that a person who sees death is approaching, has an obligation to create will. The importance of the above mandate of Qur'an has also been stressed by the following Hadith:
"Narrated Abdullah‑bin‑Umar Allah's Apostle (s.a.w.) said, 'It is not permissible for any Muslim who has something to will, to stay for two nights without having his last will and testament w ' en and kept ready with him."
It was canvassed by some counsel and the Jurisconsults that this Ayat‑e‑Qur'ani has been abrogated on account of later revelation by which the parents had been included in the persons to inherit. It is the cardinal principle of interpretation that where two provisions in a law are irreconcilable the later shall prevail but all efforts should be made to keep both the provisions intact if a reconciliation of the two can be reached. The direction of creating a will on account of later revelation by including the parents as heirs is abridged to the extent of will in favour of the parents alone but the creation of the will as regards others including the next of kins who are not heirs remains intact in the mandatory form in which it was revealed. Obviously the grandchildren are the nearest next of kin and they having not been included as heirs will be entitled to have a will created in their favour within the limited prescribed for creating the will. The significance and limits of which can be found from the known traditions of Prophet (s.a.w.). Creation of a will in favour of orphan grandchildren out of an estate of grand parents to the extent of 1/3rd would be another very plausible solution to meet the socio‑economic problem in this regard.
Measure has been resorted to in some Muslim countries and that the laws enforced in this respect in Egypt and Kuwait are being effectively made use of.
Federal Shariat Court, however, left the matter to the legislative domain of the country to deliberate on it and bring about the law which would safeguard the interest of the orphan grandchildren and exclude all possible complications of litigation that may crop up as a result of loose or un thought for provision of law. Creation of a will was preferred in favour of the orphan grandchildren by the grandparent over other solutions which may be available for the socio‑economic problem, inter alia, for the following reasons: ‑‑
(a) that this derives strength from Qura'aic Injunctions as the orphan grandchildren being not heirs would be entitled to the will in their favour as regards the estate of the propositus;
(b) that the orphan grandchildren would have fruits from the assets of their grandparent without any inhibition as they would be enjoying the same as of right in the same manner as their Uncles and Aunts as heirs would be enjoying benefits of the estate of their father; and
(c) that a provision can be made that in case a propositus dies without creating a will, the will, to the extent of 1/3rd in favour of the grandchildren out of the estate with a ceiling that it does not go beyond the share of their predecessor, shall be deemed to have been created by, the grandparents in their favour.
From the above it squarely follows that in the presence of the direct mandatory injunctions of Holy Qur'an itself and also the Ahadith there was no occasion, and could possibly be none ever, to add anything thereto or subtract anything therefrom, in the matter of inheritance.
The provision contained in section 4 of the Muslim Family Laws Ordinance, 1961, as presently in force, is repugnant to the Injunctions of Islam and Federal Shariat Court directed the President of Pakistan to take steps to amend the 'taw so as to bring the said provision in conformity with the Injunctions of Islam. It was further directed that the said provision which has been held repugnant to the Injunctions of Islam shall cease to have effect from 31st March, 2000.
AI‑Qur'an: Sura Nisa, Ayat 7; 11; 12; 13; 14; 33; 177; Sahih Bukhari, Hadith No.724, Vol. 8, p.477; Sahih Bukhari, English, Vol. 8, p.479; Sharh Sahih Muslim, Vol. II, p.53 and Wasail‑ul‑Shai'a, Vol. 17, p.452, Printed in Beruit ref.
(i) Interpretation of statutes‑‑
‑‑‑‑Where two provisions in a law are irreconcilable, the latter shall prevail but all efforts should be made to keep both the provisions intact if a reconciliation of the two can be reached.
(j) Muslim Family Laws Ordinance (VIII of .1961)‑‑‑
‑‑‑‑S. 5‑‑‑Constitution of Pakistan (1973), Art.203‑D‑‑‑Registration of marriages‑‑‑Repugnancy to Injunctions of Islam‑‑‑Provision contained in S.5, Muslim Family Laws Ordinance, 1961, is in no manner violative of any Injunction of Islam‑‑‑Federal Shariat Court recommended that Government should clarify the position in S.5 of the Ordinance that non‑registration of Nikah under S.5, Muslim Family Laws Ordinance, 1961 does not invalidate Marriage/Nikah itself, if otherwise Nikah has been performed in accordance with the requirements of Islamic Shariah‑‑‑Federal Shariat Court further observed that for having effectual compliance of the provision, it would be desirable that the punishment prescribed by S.5(4) of the Ordinance be suitably enhanced as that prescribed presently is not adequate to attract strict compliance of the provision.
It is the admitted position that there is no Qura'nic Verse and for that matter any Hadith which prohibits the Registration of the Nikah or for bringing into writing the performance of a Nikah. A bare perusal of the provision of section 5, Muslim Family Laws Ordinance, 1961 would show that it is intended to regulate the procedure of Nikah in a Muslim country and to keep record of marriages which in turn entails the paternity of children, in‑inheritance etc. and keeping of such a record would obviate any possibility of complications in respect of the above matters which, before the promulgation of this provision, were usually faced by the society. The bringing of this provision on the statute book, therefore, is not only not violative of any Injunction of Islam but to the contrary, is helpful in establishing an orderly society in the country. Whilst on the subject it would also be of benefit to observe that in Islam marriage has been given the position of a contract and not only a contract of ordinary nature but a contract of a high social status. It is manifest from Ayat 282, Sura Baqara as also from a number of Ahadith that while entering into a contract it shall be desirable to bring the same into writing. If such a mandate is available for contacts of commercial nature, money matters etc. how can a contract of a higher status, i.e. a social contract, can be excluded from being brought into black and white. It, therefore, emerges that entering into a written contract of marriage and making it certain by registration through a Government record, is essential for an Islamic society as envisaged by the Holy Qur'an and Sunnah of Nabi‑e‑Karim (p.b.u.h.). Registration of marriage as provided for by section 5, in a Government record, will be a positive check on the litigation where due to non‑registration, the marriage and/or paternity of children is denied in order to just deprive the wife or the children from their inheritance. The measure intended to be preventive for avoiding litigation can, thus, in no manner be termed as un‑Islamic or opposed to the Injunctions of Islam.
Non‑registration of Nikah under section 5 of the Muslim Family Laws Ordinance, 1961 does not invalidate marriage/Nikah itself merely on account of non‑registration of Nikah, if otherwise Nikah has been performed in accordance with the requirements of Islamic Shariah. The Government should clarify this position in the provision itself.
For having effectual compliance of the provision it would be desirable that the punishment prescribed by subsection (4) of section 5 be suitably enhanced as that prescribed presently is not adequate to attract strict compliance of the provision.
The provision contained in section 5 of the Muslim Family Laws Ordinance, 1961 is in no manner violative of any Injunctions of Islam.
Abdul Kalam v. The State NLR 1987 SD 545 and Muhammad Ramzan v. Muhammad Saeed and 3 others PLD 1983 FSC 483 and Arif Hussain and Azra Parveen v. State PLD 1982 FSC 42 ref.
(k) Islamic Jurisprudence‑‑‑
‑‑‑‑ Marriage‑‑‑Polygamy‑‑‑History of existence of polygamy as an ancient practice in the pre‑Islamic era traced.
2 Samuel 5:13; 1 Kings 11:3; Leviticus 18:18; Polygamy Reconsidered by Father Eugene Hillman and Al‑Qur'an 4 : 3 ref.
(l) Muslim Family Laws Ordinance (VIII of 1961)‑‑‑
‑‑‑‑S. 6‑‑‑Constitution of Pakistan (1973), Art.203‑D‑‑‑Polygamy‑‑Repugnancy to Injunctions of Islam‑‑‑Provisions of S.6, Muslim Family Laws Ordinance, 1961 are derivable on a conjunctive reading of Ayaat 3 and 35 of Sura Nisa of Holy Qur'an‑‑‑Status of polygamy in Islam is no more or no less than that of a permissible act and has never been considered a command and, therefore, like any other matter made lawful in principle, may become forbidden or restricted, if same involves unlawful things or leads to unlawful consequences, such as injustice‑‑‑Misuse of the permission granted by Allah could be checked by adopting suitable measures to put an end to or at least minimise the instances of injustice being found abundantly in the prevalent society, therefore, it be explicitly made clear in S.6(1) of the Ordinance that Arbitration Council, constitution of which is not violative of Injunctions of Islam, may be moved by the wife herself or her parents to t determine whether a husband can have a second, third or fourth wife as the case may be‑‑‑Arbitration Council in such circumstances would be needed to look into the disputes arising between husband and his existing wife/wives with respect to another marriage and after taking into consideration the age, physical health, financial position and other attending factors, come to a conclusion to settle their disputes‑‑‑Arbitration Council should figure in when a complaint is made by the existing wife or her parents/guardians‑‑Arbitration Council is not empowered to make unlawful anything declared lawful by Islam nor could do vice versa‑‑‑Intention is to protect the rights of the existing wife/wives and interest of her/their children‑‑‑Section 6, Muslim Family Laws Ordinance, 1961 has not expressly declared the subsequent marriage illegal and has merely prescribed a procedure to be followed for the subsequent marriages and punishments for its non‑observance, thus, spirit of the section is reformative only as in fact same has prescribed a corrective measure for prevention of injustice to the existing wife/wives‑‑‑Subject to observations recorded to amend the provisions of S.6 and recommendations made by Federal Shariat Court, provisions of S.6, Muslim Family Laws Ordinance, 1961 are not violative of the Injunctions of Islam.
There is no doubt that a Muslim male is permitted to have more than one woman as wife with a ceiling of 4, at a point of time as the ultimate, but the very Ayat which gives this permission also prescribes a condition of (-----) and the Holy Qur'an has laid emphasis in the same Verse on the gravity and hardship of the condition which Allah Himself says is very difficult to be fulfilled.
Now section 6 of the Muslim Family Laws Ordinance as framed, in no manner places any prohibition in having more than one wife. It only requires that the condition of "----" prescribed by Holy Qur'an itself should be satisfied by the male who wants to have more than one wife. The provision for constituting an Arbitration Council, therefore, cannot in itself be said to be violative of Injunctions of Qur'an as only a procedure has been prescribed how the Qura'nic Verse will be observed in its totality with reference to the condition of " ---- " placed in the Verse itself.
Here Sura Nisa, Ayat 35 is referred which provides for the resolution of dispute between husband and wife and the Qura'nic Injunction as ordained in the said Ayat also is to refer the matter in dispute to representatives of each of the parties to the dispute. The provisions contained in section 6 are therefore, derivable on a conjunctive reading of Ayaat 3 and 35 of Sura Nisa.
It may, however, be observed that it be explicitly made clear in subsection (1) of section 6 of the Ordinance that Arbitration Council may be moved by the wife herself or her parents to determine whether a husband can have a second, third or fourth wife as the case may be.
Nikah is a social contract of very high status and conjoins a couple and the spouses in a sacred association, with mutual rights and obligations, to be performed in a spirit of love and affection that should last life long, as envisaged by Ayah No.21 of Sura No.30, Ayah No.228 of Sura Baqara and Ayah No. 19 of Sura‑e‑Nisa. Therefore, anything, big or small, that may provide a cause for a breach in mutual love and' trust is viewed seriously by Islamic Injunctions. In such situations the Holy Qur'an enjoins upon all Muslims to take appropriate measures to save this sacred union from disruption. Reference in this connection may be made to Verse No.35 of Sura Al‑Nisa. Since one of the reasons for such disputes may be intention of the husband to contract subsequent marriage of his choice, an Arbitration Council may be required to settle the dispute. The Arbitration Council is not empowered to make unlawful anything declared lawful by Islam nor could do vice versa. However, the status of polygamy in Islam is no more or no less than that of a permissible act and has never been considered a command, and therefore, like any other matter made lawful in principle may become forbidden or restricted if it involves unlawful things or leads to unlawful consequences such as injustice. Misuse of the permission granted by Almighty Allah could be checked by adopting suitable measures to put‑an end to or at least minimise the instances of injustice being found abundantly in the prevalent society. The Arbitration Council in such circumstances would be needed to look into the disputes arising between husband and his existing wife/wives with respect to another marriage and after taking into consideration the age, physical health, financial position and other attending factors, come to a conclusion to settle the in disputes. The Arbitration Council `should figure in when a complaint is made by the existing wife or her parents/guardians. The intention is to protect the rights of the existing wife/wives and interest of her/their children. The wife is, therefore, the best judge of her cause who or her parents may initiate the proceedings if her husband intends to contract another marriage. Moreover, since a Nikah validly performed with a wife, whether first or fourth, necessarily entails various consequences including those related to dower, maintenance, inheritance, legitimacy of children etc., non‑registration of the Nikah, thus, performed could not only be a source of litigation between the parties but would also lead to a lot of injustice to such wife/wives.
Since this section has not expressly declared the subsequent marriage as illegal and has merely prescribed a procedure to be followed for the subsequent marriages and punishment for its non‑observance, the spirit of this section is reformative only as in fact it has prescribed a corrective measure for prevention of injustice to the existing wife/wives.
Subject to observations and recommendation of the Court in para.92 to amend the provisions of section 6 of the Muslim Family Laws Ordinance, 1961, the said provisions are not violative of the Injunctions of Islam.
Al‑Qur'an: Surah Nisa, Ayats 4:3; 4:35; 19; Ayah No.21 of Surah No.30, Surah Baqara, 228 and Sahih Sanan Al‑Mustafa by Imam Abu Daood, 1st Vol. pp.323‑324 ref.
(m) Muslim Family Laws Ordinance (VIII of 1961)‑‑‑
‑‑‑‑S. 7‑‑‑Constitution of Pakistan (1973), Art.203‑D‑‑‑Talaq‑‑‑Period of Iddat‑‑‑Repugnancy to Injunctions of Islam‑‑‑Provision of S.7, Muslim Family Laws Ordinance, 1961 as a whole is not violative of Injunctions of Islam‑‑‑Provisions of S.7(3)(5) of the Ordinance, however, being repugnant to Injunctions of Islam, President of Pakistan was directed by Federal Shariat Court to take steps to amend the law so as to bring the provisions of S.7(3)(5) of the Ordinance into conformity with the Injunctions of Islam‑‑‑ Said provisions of S.7(3)(5) being repugnant to Injunctions of Islam shah cease to have effect on 31st day of March, 2000.
The purport of section 7 of the Muslim Family Laws Ordinance is regulatory only to give certainty to an event of great importance for the spouses and their families. However, the over exuberance of legislation in a new field has resulted into the creeping in of certain discrepancies and implied violation of the Injunctions of Qur'an in two of its subsections viz. subsections (3) and (5).
Talaq though a legally permissible mode of separation between spouses and bringing to end the relations between husband and wife, is nevertheless an act which has been looked down upon by Holy Prophet (s.a.w). He has termed Talaq as (------) i.e. the most abhorred amongst the permissible acts. This Hadith of Nabi‑e‑Karim (s.a.w) gains significance when read in conjunction with Ayat No.2 of Sura Talaq. It would be distinctly seen that the emphasis of presence of witnesses in the matter of Talaq by Holy Qur'an is for obvious reason, that since it disassociates two persons from ‑ each other who were before that act, the closest to each other and, therefore, all obligations towards each one of them, should be brought to end with certainty through recorded measure. 1'he principle underlying the provision of section 7 being the intention to achieve the objective of Holy Qur'an viz. to avoid uncertainty and exploitation as regards one of the most important elements of an Islamic society, which if not recorded, may entail immorality as also litigation, no valid objection can be raised to the spirit of section 7 of the Ordinance.
However, subsection (3) as presently framed does not conform to the requirements of Injunctions of Qur'an. The period of Iddat can be clearly derived from the Ayaat and these cater for situations of all types that may arise in the event of Talaq. The matter of Iddat is of great importance as can be seen from Ayat No.1 of Sura‑e‑Talaq. There is emphasis laid that the period of Iddat should be computed specifically and accurately and for each situation that may arise specifical period has been prescribed. For example in the case of a marriage which has not been consummated there is no period of Iddat as laid down by Ayat No.49 of Sura Al‑Ahzab. Similarly in case of Talaq during the period of pregnancy the Iddat stands terminated immediately on the delivery of child which may well be within one minute of the pronouncement of Talaq as mentioned in Ayat No.4, Sura Talaq. Now keeping this period of 90 days in such cases as well, is clearly violative not only of the Injunctions of Islam but is also a matter of grave hardship to the divorcee. Islam is the protector of rights of all human beings and is the first religion which has conferred all possible rights that could be bestowed upon a woman. Fixation of period of 90 days of Iddat in ail cases including those referred to above, abridges the rights of women as bestowed upon them by Qur'an and, therefore, does not merit to be retained in the present form.
The period of Iddat is to commence from the date of pronouncement of Talaq and not from the day of delivery of notice to the Chairman as the Talaq takes effect from the date of pronouncement of Talaq by the husband. Now it may well be that the husband may not give notice of Talaq as required by subsection (1) of section 7 with ill‑intention for a long period, and thus,, by virtue of subsection (3) keep the woman in suspended animation and cause .her torture by keeping her bound, although according to the Qura'nic Injunctions she would stand released of the bond and under no obligation towards him. This will certainly be a cruelty to the woman who, by virtue of this provision, can be exposed to the hazards of litigation by an unscrupulous husband, if she marries after the expiry of Iddat as enjoined by Holy Qur'an but before the expiry of period prescribed by subsection (3). Such a situation of uncertainty entailing peril to a party should not be allowed to continue.
Subsection (5) of section 7 when viewed in the light of the above discussion also appears to be an unwanted provision as it prescribes. a period which is not in consonance with the period of Iddat prescribed by the Qura'nic Injunctions. There is no need to have subsection (5) as a separate provision because a comprehensive subsection (3) providing all periods of Iddat as may be enjoined upon a Muslim woman when Talaq is pronounced by her husband, should be succinctly provided in one and the same subsection.
Section 7 of the Muslim Family Laws Ordinance, 1961 as a whole cannot be declared as violative of Injunctions of Islam. However, the provisions contained in subsection (3) and subsection (5) of the said section 7 cannot be maintained.
Resultantly subsection (3) and subsection (5) of section 7 of Muslim Family Laws Ordinance, 1961 are repugnant to the Injunctions of Islam and it is directed that the President of the Islamic Republic of Pakistan shall take steps to amend the law so as to bring the above provisions into conformity with the Injunctions of Islam. The above provisions of subsection (3? and subsection (5) which have been held to be repugnant to the Injunctions of Islam shall cease to have effect on 31 st day of March, 2000. [p. 60] P
Al‑Qur,'an: Sura Nisa, Verse 35; Sura Al‑Ahzab, Ayat 33:49 and Sura AI‑Talaq, Verses 65:1; 65:2; 65:4 ref.
M. Aslant Uns for Petitioner (in Shariat Petition No.29/1 of 1993).
M. Aslam Uns for Petitioner (in Shariat Petition No.32/I of 1993).
M. Adam Uns for Petitioner (in Shariat Petition No.37/I of 1993).
M. Aslam Uns for Petitioner (in Shariat Petition No.42/I of 1993). i
Ch. Abdur Rehman for Petitioner (in Shariat Petition No. 13/L of 1993).
Lal Khan and Sardar‑Muhammad Irshad for Petitioner (in Shariat Petition No.3/I of 1994).
Abdur Rehman Khan for Petitioner (in Shariat Petition No.28/I of 1994).
Malik Noor Muhammad Awan for Petitioner (in Shariat Petition hfo.6/L of 1994).
Sardar Ghazi Raza Khan for Petitioner (in Shariat Petitions Nos. 10/L and 11 /L of 1994).
Ghulam Mustafa Awan for Petitioner (in Shariat Petition No. 15/1 of 1995).
Saleem Raza Qureshi for Petitioner (in Shariat Petition No. 18/1 of 1995).
Petitioner in person (in Shariat Petition No. 19/1 of 1995).
Nemo for Petitioner (in Shariat Petition No.5/L of 1995).
Petitioner in person (in Shariat Petition No.7/I of 1995).
Saleem Raza Qureshi for Petitioner (in Shariat Petition No.3/I of 1996).
M. Aslam Uns for Petitioner (in Shariat Petition No.4/I of 1996).
Anwar H. Mir for Petitioner (in Shariat Petition No.6/I of 1996).
M. Aslam Uns for Petitioner (in Shariat Petitions Nos. 10/I, I1/I, 13/1 of 1996).
Bashir Ahmed Ansari for Petitioner (in Shariat Petition No. 10/1 of 1997).
Rana Muhammad Nazir Saeed and Khadim Nadeem for Petitioner
(in Shariat Petition No.4/L of 1997).
Petitioner in person (in Shariat Petition No. 14/1 of 1997).
Petitioner No. l in person (in Shariat Petition No. 10/1 of 1998).
Rasheed Murtaza for Petitioner (in Shariat Petition No.l/L of 1998).
Ismail Qureshi for Petitioner (in Shariat Petition No.2/L of 1998).
Qari Abdur Rasheed for Petitioner (in Shariat Petition No. 14/1 of 1999).
Nadeem Shibli for Petitioner (in Shariat Petition No. 16/1 of 1994).
Petitioner in person (in Shariat Petition No.26/I of 1994).
S.H. Qureshi for Petitioner (in Shariat Petition No.2/P of 1996).
Nemo for Petitioner (in Shariat Petition No.2/I of 1996).
Petitioner in person (in Shariat Petition No.4/I of 1994).
Petitioner in person (in Shariat Petition No.7/I of 1995).
Nemo for Petitioner (in Shariat Petition No.27/I of 1995).
Hafiz Usman Ghani for Petitioner (in Shariat Petition No.21/1 of 1995).
Petitioner No. l in person (in Shariat Petition No. l l /I of 1998).
Dr. Riazul Hassan Gillani for the Federal Government;
Mansoor Ahmed, Deputy Attorney‑General for Pakistan;
Dr. Abdul Malik Irfani for the Federal Government;
Malik Sikandar Khan, A.G. Balochistan;
Musarratullah Khan, Asstt. A.G. N.W.F.P.;
Riaz Ahmed Khan on behalf of A.G., N.W.F.P.;
Aziz ur Rehman for A.G., N.W. F. P.;
Ashtar Ausaf Ali for A.G. Punjab;
Raja M. Akram Khan, Asstt. A.G., Punjab;
Raja Saeed Akram, Asstt. A.G., Punjab;
Fazal‑ur‑Rehman Rana for A.G. Punjab;
M. Iqbal Raad, Addl. A.G., Sindh and
Munib Ahmad Khan, Addl. A.G., Sindh.
Dr. Muhammad Tafuil Hashmi, Maulana Syqd Shabir. Ahmad Kakakhel, Maulana Nooruddin Jami, Mufti Ghulam Sarwar Qadri, Maulana Fazalur Rahim, Maulana Muhammad Taseen, Dr. Saeedullah Qazi, Maulana Gohar Rehman, Maulana Anwarul Haq Haqani, Maulana Niaz Muhammad Durrani, Maulana Ghulam Mehdi Najafi, Agha Yaqoob Ali Tawasli, Maulana Qari Iftikhar Ahmed arid Maulana Arshad Yameen: JurisConsutants.
Mrs. Rasheeda Patel, Ms. Asma Jahengir, Syed Afzal Haider, M. Z. Khan, Ms. Alia Neelam, Ms.Shaista Qaiser, Ms. Shamsa Ali, Ms. Tanveer Jehan, Member, Human Rights Commission of Pakistan, Ms. Fouzia Jalal, Mushtaq Ahmad student LL.B.(Hon) and Mrs. Najmus Sahar Attaullah: Others
Dates of hearing: 18th January; 5th April, 1994; 28th November, 1995; 2nd April; 4th June, 1st July, 18th November, 1998; 4th February; 10th March; 30th April; 20th May; 10th June; 8th, 15th and 29th December, 1999.
P L D 2000 Federal Shariat Court 63
Before Gul Muhammad Khan, C. J., Fakhurddin H. Shaikh and Mufti Syed Shujaat Ali Qadri, JJ
ABDUL KALAM‑‑‑Appellant
Versus
THE STATE‑‑‑Respondent
Criminal Appeal No.99/K of 1986, decided on 17the March, 1987.
Offence of Zina (Enforcement of Hudood) Ordinance (VII of 1979)‑‑‑
‑‑‑‑S. 10(3)‑‑‑Muslim Family Laws Ordinance (VIII of 1961), S.5‑‑Appreciation of evidence‑‑‑Non‑registration of Nikah‑‑‑Effect‑‑‑Accused had claimed that age of girl according to her own mother was 16/17 years and that her Nikah with him was proved by three witnesses against whom nothing had been said in cross‑examination‑‑‑Contention of prosecution was that as Nikah was not registered and was not found in Register of Nikah and also that thumb‑impression was also not found to be that of girl, Nikah was not proved‑‑‑Validity‑‑‑Registration of Nikah was not necessarily the proof of Nikah as, in Muslim Law Nikah could be performed by offer and acceptance in presence of witnesses‑‑‑Non‑registration of Nikah would only attract a penalty under S.5(4) of Muslim Family Laws Ordinance, 1961‑‑‑In absence of any error in Nikah of accused with the girl, conviction and sentence awarded to accused by Trial Court were set aside and he was acquitted.
Muhammad Ayub Khanzada for Appellant.
Niaz Ahmad for the State
Date of hearing: 17th March 1987.
P L D 2000 Karachi 1
Before Rasheed Ahmed Razvi, J
ABDUL RASHID ABBASI---Appellant
versus
ALLAUDIN---Respondent
First Rent Appeal No.] and Civil Miscellaneous Application No.33 of 1999, decided on 5th May, 1999.
Sindh Rented Premises Ordinance (XVII or 1979)---
----Ss. 15 & 19---Ejectment application---Notice to tenant---Ex parte order, setting aside of---Notice of ejectment proceedings to be issued to tenant, must accompany with a copy of ejectment application enabling tenant to file his written reply within a period of fifteen days from date of service of said notice--Ejectment application was not served upon the tenant---Effect---Simple knowledge of tenant that ejectment case had been filed against him (without having a copy of ejectment application served upon him) was not sufficient material to non-suit the tenant and to proceed ex parte against him---If Rent Controller came to the conclusion that tenant was avoiding to receive notice or was unable to be served in ordinary course, Rent Controller should adopt the procedure as provided in Order V, R.20, C.P.C.---Whether envelop despatched to tenant contained his full and complete address and whether a copy of ejectment application was also enclosed was not clear---Even full name of tenant did not appear on the postal receipt---Benefit of any doubt occurring from such circumstances, must go to party (tenant) who was being non-suited on ground of service of notice.
Amin Khan v. University of Sindh PLD 1968 Kar. 899; Haji Karamat Hussain v. Naik Khan Muhammad 1986 CLC 6; Gulab Chand v. Shankar Lal and others ILR 35 All. 163; Sudhansu Bhattacharyyo v. Chairman, Patna City Municipality AIR 1932 Pat. 150; Kassim Ebrahim Saleji v. Johurmull Khemka AIR 1916 Cal. 181(2) = ILR 43 Cal. 437; Narendra Kishore Das v. Banamali Sahu Dibakar Sahu Firm AIR 1951 Orissa 312; Jagdish Prasad Khakalia v. Jesraj Talakchand Lalchand AIR 1954 Assam 223; Radha Ballav Thakur v. Dayal Chand Bose AIR 1962 Orissa 15; M.A. Latif Faruqui v. National Bank of Pakistan PLD 1981 Kar. 645; Dhanjishaw Bahramji Ghadialy and another v. Abdul Latif PLD 1983 Kar: 121; Zulfiqar Ali v. Lai Din and another 1974 SCMR 162; Khair Muhammad v. Akhtar Hussain 1983 CLC 302 and Muhammad Ibrahim v. Mst. Mehmooda 1987 CLC 1994 ref.
Badrul Alam for Appellant.
Muhammad Zafar for Respondent
P L D 2000 Karachi 6
Before Sarmad Jalal Osmany, J.
RIAZ AHMED GOHARSHAHI‑‑‑Applicant
versus
THE STATE‑‑‑Opponent
Criminal Bail Applications Nos.88, 200, 159 and 660 of 1999, decided on 2nd August, 1999.
(a) Criminal Procedure Code (V of 1898)‑‑
‑‑‑‑S. 498‑‑‑Pre‑arrest bail‑‑‑Allegation of mala fides and ulterior motive prima facie had to be established by the material on record in matters regarding bail before arrest‑‑‑Fact that unless bail before arrest was granted, the accused would inter alia suffer irreparable loss including his honour, dignity and self‑esteem was also to be established.
Muhammad Safdar v. The State 1993 SCMR 645; Ziaul Haq v. The State PLD 1984 SC 192; Shabbir Ahmed v. The State PLD 1981 Lah. 599; Ajmal Khan v. Liaquat Hayat 1988 MLD 880 and Raza Muhammad Siyal v. The State 1998 SCMR 1223 ref.
(b) Criminal Procedure Code (V of 1898)‑‑‑
‑‑‑‑S. 498‑‑‑Penal Code (XLV of 1860), S.302/324/34/109‑‑‑West Pakistan Arms Ordinance (XX of 1965), S.13‑D‑‑‑Pre‑arrest bail‑‑‑Sufficient material was available on record to prima facie substantiate the allegation of malicious prosecution at the hands of the religious opponents of accused‑‑‑Accused claimed himself to be a person free of any religious bias and his "Astana" was open to all persons, as a result of which beliefs his opponents were bent upon prosecuting him which was prima facie, established by various newspaper items whereby certain segments of the Ulema had placed head money upon his life declaring him to be a disbeliever and an apostate‑‑‑Since police sought to arrest the accused on one pretext or the other, he had rightly approached High Court directly for pre‑arrest bail in the facts and circumstances of the case‑‑‑Accused was not alleged to have played any direct role in the conspiracy and abetment with the co‑accused responsible for the death of the deceased‑‑‑Affidavits of certain persons regarding presence of accused in another city on the day of incident could be considered at the bail stage‑‑‑Police opinion regarding the guilt or innocence of accused could be considered by Trial Court after appreciation of evidence and the same could not be assessed at such stage‑‑‑Exercise of dropping of an accused and substituting him with another in the challan could not carry any weight at bail stage‑‑‑Case of accused, therefore, needed further probe‑‑Interim pre‑arrest bail granted to accused was confirmed in circumstances.
Abdul Hameed Jatoi v. The State 1973 PCr.LJ 1032; State v. Mukhtar Ahmed Awan 1991 SCMR 322; Jam Sadiq Ali v. The State 1989 PCr.LJ 1910; Dr.M. Shoib v. The State 1997 SCMR 1234; Abdul Haq Siddiqui v. The State 1993 PCr.LJ 446; Amjad v. The State 1982 SCMR 955; Manzoor v. The State PLD 1972 SC 81; Zahid Paris v. The State 1995 PCr.LJ 5; Amanullah v. The State 1997 PCr.LJ 1578; Aziz‑ur‑Rehman v. The State 1985 PCr.LJ 1282; Zulfiqar Ali v. The State 1994 SCMR 549; Naseer Ahmed v. The State PLD 1997 SC 347; Muhammad Arshad v. The State 1996 SCMR 74; Lt.‑Gen. (Retd.).Sabeeh Qamar‑uz‑Zaman v. The State 1997 PCr.U 1765; Abdul Razzak v. The State 1998 PCr.LJ 1360; Katbar v. The State 1998 PCr.LJ 1438; Khaiilur Rehman v. The State 1998 PCr.LJ 1625; Muhammad Hussain v. Muhammad Anwar Ahmed Khan 1‑975 SCMR 151; Muhammad Safdar v. The State 1993 SCMR 645; Ziaul Haq v. The State PLD 1984 SC 192; Shabbir Ahmed v. The State PLD 1981 Lah. 599; Ajrnal Khan v. Liaquat Hayat 1988 MLD 880 and Raza Muhammad Siyal v. The State 1998 SCMR 1223 ref.
(c) Criminal Procedure Code (V of 1898)‑‑‑
‑‑‑‑S. 498‑‑‑Pre‑arrest bail‑‑‑Direct approach to High Court‑‑‑Superior Courts can entertain applications for pre‑arrest bail and grant relief to accused in appropriate cases where accused could, inter alia, establish that he was prevented from approaching the lower Court concerned.
State v. Mukhtar Ahmed Awan 1991 SCMR 322 and Dr. M. Shoib v. The State 1997 SCMR 1234 ref.
Qurban Ali H. Chohan for Applicant.
Agha Khuda Bukhsh, A.A.‑G. for the State. .
Date of hearing: 2nd April, 1999.
P L D 2000 Karachi 13
Before Muhammad Roshan Essani, J
Mst. KISHWAR SULTANA and 4 others---Petitioners
versus
THE STATE through Advocate-General, Sindh and 4 others---Respondents
Criminal Miscellaneous Application No.1270 of 1999, decided on 11th May, 1999.
Criminal Procedure Code (V of 1898)---
----S. 497(5)---Penal Code (XLV of 1860), 5.337-A(iii)/504/427---Sindh Children Act (XII of 1955), S. 5---Cancellation of pre-arrest bail---Previous enmity did not exist between the parties---Case being an outcome of sudden flare-up, common intention or pre-concert on the part of accused was, prima facie lacking---Accused were of tender age ranging from 13 years to 16 years and their case was covered by the provisions of Sindh Children Act, 1955--Accused were empty-handed anal they were not alleged to have misused the concession of pre-arrest bail---No specific role was attributed to accused in the F.I.R.---Injuries sustained by prosecution witnesses were not on vital parts of their bodies---Benefit of two versions in the case even at bail stage was to be given to accused and not to the prosecution---Case being at the verge of completion in the Trial Court, cancellation of bail of accused at such stage was not appropriate---Case against accused was not hit by the prohibition contained in S.497(1), Cr.P.C.---Impugned order granting bail to accused did not suffer from any legal or factual infirmity---Petition for cancellation of pre-arrest bail of accused was dismissed accordingly.
S. Sarfraz Ahmed for Petitioners.
Ali Gohar Masroof for Respondents.
P L D 2000 Karachi 16
Before Sarmad Jalal Osmany, J
Messrs STAR VACUUM BOTTLE MANUFACTURING COMPANY (PVT.) LTD. through Chief Executive---Plaintiff
versus
FEDERATION OF PAKISTAN and 3 others---Defendants
Suit No.699 of 1997, decided on 12th August, 1999.
Customs Act (IV of 1969)---
----Ss. 18 & 31-A---Effective date of duty to be imposed---Exemption from customs duty---Exemption from customs duty had no nexus with the establishment of a Letter of Credit or finalization of a contract of sale of the goods in question, but to the date of gill of Entry---Goods for which exemption was sought, should have arrived .in Pakistan before the date on which said exemption was withdrawn, because it was on date of Bill of Entry that obligation to pay customs duties was crystallized in terms of S.18, Customs Act, 1969--Rights and liabilities of the importers attain fixation on said crucial date, Abbasia Cooperative Bank and another v. Hafiz Muhammad Ghaus and 5 others PLD 1997 SC 3; AI-Samrez Enterprise v. The Federation of Pakistan 1986 SCMR 1917; Associated Trading Co. Ltd. v. The Central Board of Revenue PLD 1987 Kar. 63; Pakistan through Secretary, Ministry of Finance v. Salahuddin PLD , 1991 SC 546; Messrs Tharparkar Sugar Mills Ltd. v. Federation of Pakistan 1996 MLD 1221; Chairman, Selection Committee/Principal, King Edward Medical College, Lahore v. Wasif Zamir 1997 SCMR 15; Molasses Trading and Export (Pvt.) Ltd. v. Federation of Pakistan, 1993 SCMR 1905; Army Welfare Sugar Mills v. Federation of Pakistan 1992 SCMR 1652; Mian Nazeer Sons Industries Limited v. Government of Pakistan 1992 SCMR' 883; Federation of Pakistan v. Amjad Hussain Dilawary 1992 SCMR 1270; Federation of Pakistan v. Punjab Steel Limited 1993 SCMR 2267 and M.Y. Electronics Industries (Pvt.) Ltd. v. Government of Pakistan 1998 SCMR 1404 ref.
Farogh Nasim for Plaintiff.
Sattar Silat for Defendants
P L D 2000 Karachi 22
Before M. Shaiq Usmani, J
MANHATTAN PAKISTAN (PVT.) LTD. ---Plaintiff
versus
GOVERNMENT OF PAKISTAN and another---Defendants
Suit No. 183 of 1993, decided on 7th May, 1999.
(a) Contract Act (IX of 1872)---
----Ss. 191 & 192---Agreement involving appointment of a sub-agent--Whenever Government entered into any agreement with a party which involved appointing a sub-agent by said other party, Government invariably and rightly so reserved the right to approve or not to approve the appointment of such subagent which was done often for security reasons and also for keeping undesirable elements away from any direct dealing with Government---Reservation of such right or enforcing same would not entail or constitute an approval of sub-agent's work itself or creating any contractual or quasi-contractual relationship between the Government and such sub-agent.
(b) Contract Act (IX of 1872)---
----S. 70--Conditions to invoke provisions of S.70, Contract Act; 1872---Three conditions must be met before invocation of provisions of S.70 of Contract Act, 1872; viz. that a person must lawfully do something for another person and deliver something to him; that in doing said thing or delivering said thing, he must not intend to act gratuituously; and that the other person for whom something was done or to whom something was delivered, must enjoy the benefit thereof---If a conclusion was reached to the effect that S.70, Contract Act, 1872 was applicable and if there was no contractual term fixing the compensation for the work done or services rendered, the Court could grant compensation "quantum meruit".
(c) Contract Act (IX of 1872)---
----S. 70---"Quantum meruit"---Meaning and grant of---Quantum meruit, was nothing but a reasonable compensation awarded on implication of contract to remunerate---Quantum meruit could not be granted where contract had provided for consideration payable in that behalf.
(d) Words and phrases-
------ Quantum meruit"---Connotation.
Abid S. Zuberi for Plaintiff.
Shaukat Hayat for Defendant No. 1.
Defendant No.2: Ex parte.
Date of hearing: 11th August, 1993.
P L D 2000 Karachi 27
Before Ata-ur-Rehman. J
QADIR HASAN TAHIR---Plaintiff
versus
Messrs FAHIMUDDIN COTTON INDUSTRIES, INDUSTRIAL AREA, KORANGI, KARACHI and 5 others---Defendants
Suit No.903 of 1996 and Civil Miscellaneous Application No.8033 of .1998, decided on 25th February, 1999.
Civil Procedure Code (V of 1908)---
----0 XXXIX, Rr. & 4---Order granting and confirming interim injunction---Recalling of such order---Earlier order whereby interim injunction was granted to applicant and subsequent order whereby said interim injunction was confirmed, were passed without considering merits of the case---Applicant in whose favour order confirming interim injunction was passed had not averred that after said order certain developments had taken place whereby said order could not be undone---In case order confirming interim injunction was recalled, no retracing steps would have to be taken---Interest of justice demanded that application filed under O.XXXIX, Rr.l & 2, C.P.C. for grant of interim injunction be decided on merits after hearing both the parties----Order whereby interim injunction was confirmed was recalled, with direction that order granting interim injunction would continue till final disposal of application filed for grant of interim injunction under O.XXXIX, Rr. 1 & 2, C.P.C.
Pakistan v. K.D.A. 1988 MLD 2668; Muhammad Yousuf v. Mst. Sabira A. Muhammad and others 1990 CLC 1127 and Chaudhry Zahoor Illahi, M.N. A. v. The State PLD 1977 SC 273 ref.
Badar Alam for Plaintiff.
S. Sarfraz Ahmed for Defendant No. 1.
Khawaja Naveed Ahmed for Defendant No.2.
P L D 2000 Karachi 31
Before Rasheed Ahmed Razvi, Mst. ARFA ARIF---Applicant
versus
Mst. KULSOOM NAQVI --- Respondent
Miscellaneous Application No, 19 and Civil Miscellaneous Applications Nos.890 and 891 of 1999, decided on 30th June, 1999.
(a) Administration of justice---
---- Conversion of one proceedings into another ---Jurisdiction of Court---Courts were competent to treat or convert one proceedings into another kind of proceedings in order to do substantial justice provided cause remained within jurisdiction of said Court---Courts were not debarred from converting an appeal into a revision and vice versa---Wrong mentioning of a provision of law, would not deprive a party of relief if it was otherwise entitled to same.
Mst. Amina Begum and others v. Mehar Ghulam Dastgir PLD 1978 SC 220; Irshad Ahmad and others v. Muhammad Jamil and others PLD 1994 Lah. 583; Muhammad Aslam v. Wazir Muhammad PLD 1985 SC 46; The Thal Engineering Industries Ltd. v. The Bank of Bahawalpur and another 1979 SCMR 32; Karamat Hussain and others v. Muhammad Zaman and others PLD 1987 SC 139 and Capital Development Authority, Islamabad v. Khuda Bakhsh and 5 others 1994 SCMR 771 ref.
(b) Civil Procedure Code (V of 1908)---
----S. 151---Invocation of provisions of S.151, C.P.C.---Essentials---In order to invoke provisions of S.151, C.P.C., it was to be shown that there was no other relevant provision in the Code and that invocation of S.151, C.R.C. would meet the ends of justice---Application under S.151, C.P.C. was to be filed in a pending proceedings and said application could not be maintained independent of any proceedings---For exercising powers under S.151, C.P.C. it was a precondition that Court exercising such powers possessed the jurisdiction---Use of powers by Court could not be resorted to independently as the same could be used only in aid of jurisdiction specified in Civil Procedure Code.
(c) Civil Procedure Code (V of 1908)---
----S. 151---Guardians and Wards Act (VIII of 1890), Ss.25 & 47---Constitution of Pakistan (1973), Art.199---Treating application under S.151, C.P.C. as Constitutional petition---Petitioner who had not challenged order passed by Court under S.25, Guardians and Wards Act, 1890 either in appeal or revision, had filed application directly under S. 151, C.P.C. for quashing of proceedings---Petitioner, in circumstances, wanted to create new powers of Civil Court which was not permissible as independent "proceedings under S.151, C.P.C. could not be maintained in presence of proceedings provided under relevant laws---Contention of petitioner that application under S.151, C.P.C. could be treated as a Constitutional petition under Art.199 of Constitution of Pakistan (1973), was repelled firstly because petitioner had not called in question order passed by subordinate Court in the said proceedings and secondly defendant in proceedings was a private party.
Mrs. Mehar Sultan Jung v. Qurban Hussain 1972 SCMR 73; Messrs Conforce Ltd. v. Syed Ali Shah and others PLD 1977 SC 599; Mohiuddin Molla v. The Province of East Pakistan and 2 others PLD 1962 SC 119; Messrs Commerce Bank Ltd., Karachi v. Messrs Sarfaraz Autos, Karachi and another PLD 1976 Kar. 973 and Messrs National Bank of Pakistan v. Mst. Parveen Akhtar PLD 1985 Kar. 60 ref.
Izhar Alam Faruqui for Applicant.
P L D 2000 Karachi 36
Before S.A. Rabbani, J
WORKS COOPERATIVE HOUSING---Plaintiff
versus
Mrs. NAIMA SALIM --- Defendant
Suit. No.1353 of 1999 and Civil Miscellaneous Applications Nos.9425 and 5668 of 1998, decided on 20th July; 1999.
(a) Sindh Buildings Control Ordinance (V of 1979)---
----S. 6---Power to grant permission for change of use of plot---Provision of S.6, Sindh Buildings Control Ordinance, 1979 does not empower the Authority to grant or withhold permission for change of use of a plot as residential, commercial or industrial which is prerogative of the lessor i.e. Cooperative Housing Society.
(b) Civil Procedure Code (V of 1908)---
----0. XXXI, Rr. 1 & 2---Interim injunction, grant of---Housing Society having separate commercial and residential areas---Residential plot was sold by one of the member of the Society for commercial construction---Housing Society filed a suit for declaration and injunction to prevent the commercial structure in residential area and to protect the scheme of the Society to maintain separate residential and commercial areas---City Development Authority did not commercialize the plot but City Building Control Authority commercialised the said plot---Society having a prima facie case, High Court granted interim injunction in favour of the Society with observation that in absence of injunction whole of the scheme of Society to maintain separate residential and commercial areas would be disturbed.
S. Irtaza H. Zaidi for Plaintiff.
Muzaffar Imam for Defendant No.2.
Muhammad Iqbal Memon for Defendant No.3.
Khalid Rehman for Defendant No.4.
P L D 2000 Karachi 38
Before S.A. Rabbani, J
FUJITSU GENERAL LTD. ---Appellant
versus
M.Y. ELECTRONIC INDUSTRIES (PVT.) LTD. ---Respondent
Miscellaneous Appeal No.24, Civil Miscellaneous Applications Nos. 1123 and 1048 of 1999, decided on 22nd July, 1999.
Trade Marks Act (V of 1940)---
----S. 76---Civil Procedure Code (V of 1908), S.151 & O.XLI, R.5---Trade mark "General" was already registered---Application for registration of trade mark label mentioning letter 'M' with the word "General" by some other party---Parties having multiple litigation---Notice of opposition was disallowed by the Registrar on the ground that word "General" had become public juris and was common amongst a number of trade marks and trade mark applied for was registered---Validity---Decision of Registrar being not based on sound reasons further proceedings for registration were not just and proper---Proceedings before Registrar were stayed till the disposal of appeal before High Court in circumstances.
Qazi Faiz Issa for Appellant.
Khawaja Mansoor and Arif Hussain Khilji for Respondent No. 1
Nemo for Respondent No.2.
P L D 2000 Karachi 41
Before S. Ahmed Sarwana, J
MUHAMMAD AZIZ---Appellant
versus
Mst. AZMAT BEGUM---Respondent
First Rent Appeal No.25 of 1999, decided on 28th June, 1999, (a) Sindh Rented Premises Ordinance (XVII of 1979)---
----S. 15---Bona fide personal need of landlord for business---Details of business---Landlady need not give details of the business intended to be done and had to state only those facts which prima facie showed that requirement was according to law and had been made in good faith---Stating nature of business to be done by landlady in the premises in the affidavit was sufficient.
1989 SCMR 1366; 1993 SCMR 67; 1988 SCMR 819; PLD 1985 SC 38; 1993 SCMR 1559; Khawaja Imran Ahmed v. Noor Ahmed 1992 SCMR 1152 and 1992 SCMR 1155 rel.
(b) Sindh Rented Premises Ordinance (XVII of 1979)---
----S. 15---Bona fide personal need of landlord---Long period tenancy---Mere fact that tenant of the premises had been in its possession for a long time as a tenant would not disentitle landlord from filing application for ejectment of tenant if he required the premises for his bona fide use.
(c) Sindh Rented Premises Ordinance (XVII of 1979)---
----S. 15---Default in payment of rent and bona fide personal need of landlord---Default in payment of rent was not proved while ejectment was ordered on ground of bona fide need of landlord---Validity---Fact that tenant had not committed default in payment of rent would not mean that landlady, through evidence having proved her bona fides need be disbelieved---Order of ejectment on ground of bona fide need, in circumstances, was not interfered.
(d) Sindh Rented Premises Ordinance (XVII of 1979)---
---S. 15---Bona fide personal need of landlady for use of her son---Son of landlady was admittedly doing business in a rented shop and would shift his business to the shop in question as same was located in a better place---Tenant in circumstances, was directed to vacate the shop.
Mst. Saira Bano v. Syed Anisur Rehman 1989 SCMR 1366; Qamaruddin v. Hakim Mehmood Khan 1988 SCMR 819; Khawaja Imran Ahmed v. Noor Ahmed 1992 SCMR 1152 and 1992 SCMR 1155 rel.
1990 ALD 479(2); 1987 SCMR 1768; 1983 SCMR 302 and 1987 SCMR 162 distinguished.
1992 SCMR 115; 1991 SCMR 2042; 1993 SCMR 67; 1988 SCMR 819; PLD 19$5 SC 38 and 1993 SCMR 1559 ref.
Yousuf Leghari for Appellant
Hakim Ali Siddiqui for Respondent
Dates of hearing: 1st, 3rd and 4th June, 1999
P L D 2000 Karachi 46
Before Rana Bhagwan Das and Sabihuddin Ahmed, J
HABIB BANK LTD. ---Appellant
versus
REMIFAR (PAKISTAN) LTD. and 5 others--Respondents
High Court. Appeals Nos.10 of 1994, -146 of 1955 and First Appeal No.69 of 1995, decided on 5th May, 1999.
(a) Banking Companies (Recovery of Loans) Ordinance (XIX of 1979)---
----S. 6---Civil Procedure Code (V of 1908), S. 48 & O.XXXIV, R.4--Limitation Act (IX of 1908), Arts.181 & 183---Suit for recovery of loan--Execution of decree---Limitation---One of the suits filed by the Bank was decreed by Special Court (Banking) and application for execution of said decree was filed before Court decreeing suit after more than five years from passing of final decree---Decree has been passed by Court other than High Court limitation for purpose of making application for execution could only be governed by Art. 181, Limitation Act, 1908, providing three years' period of limitation--Application for execution of decree passed after more than five years, was rightly dismissed being barred by limitation---Decree in second suit, though was passed by High Court, but said decree was not passed by High Court in exercise of its ordinary original civil jurisdiction but was passed exercising jurisdiction of District Court because value of suit was above the pecuniary jurisdiction of District Court concerned---Execution application filed after more than five years from date of passing of final decree, was; also liable to be dismissed being barred by time as Art. 181, Limitation Act, 1908 providing three years' limitation was applicable instead of Art. 183 of Limitation Act providing six years' limitation---decree in third suit had bee passed by High Court in exercise of its "original civil jurisdiction" ---Article 183 of Limitation Act, 1908 provided six years' limitation for execution of decree passed by High Court in exercise of its ordinary original civil jurisdiction, application for execution of the decree filed after more than five years, but before six years from passing of said decree, could not be dismissed as barred by time.
Mehboob Khan v. Hassan Khan Durrani PLD 1990 SC 77 ; Razzak v. Usman PLD 1975 Kar. 944; State Life Insurance v. S.A. Aziz Rizv PLD 1986 Kar. 79; Ahmed Khan v. Chief Justice and Judges of the High Court of West Pakistan PLD 1968 SC 171 and Mian Akber Hussain v. Aisha Bai PLD 1991 SC 985 ref.
(b) Civil Procedure Code (V of 1908)--
----S. 48---Limitation Act (IX of 1908), S.5---Execution of decree---Application for---Limitation---Provision of S.5, Limitation Act, 1908 was not extended to applications for execution of decree.
Sajjad Halai for Appellant (in H.C.As. Nos. 10 of 1994 and 1st Appeal No.69 of 1995)
Nemo for Respondents (in H.C.A: No.10 of 1994 and 1st Appeal No.69 of 1995).
Muhammad Zubair Qureshi for Appellant (in H.C.A. No. 146 of 1995).
Shafaat Hussain for Respondent (in H. C. A. No. 146 of 1995).
Date of hearing: 21st April, 1999.
P L D 2000 Karachi 50
Before Dr. Ghous Muhammad and Ata-ur-Rehman, JJ
CENTURY LINKS DEVELOPMENT CORPORATION (PVT.) LTD. ---Petitioner
versus
KARACHI CANTONMENT BOARD through Cantonment Executive officer and 2 others---Respondents
Constitutional Petition No.D-800 of 1999, decided on 8th July, 1999.
(a) Cantonments Act (II of 1924)---
----Ss. 10, 117, 178-A & 179---Constitution of Pakistan (1973), Art. 199--Constitutional petition---Construction of building in Cantonment area--Approval of construction plan---Proposed building plan for raising construction on plot for ground plus nine floors, submitted by petitioner was approved by Cantonment Board which was the Competent Authority to approve said building plan---While construction was in full progress according to approved plan, Cantonment Board without any notice, intervened and forcibly stopped work and some portion of structure was also demolished contending that construction beyond ground plus one floor shall not be raised unless No-Objection-Certificate was issued by Station Headquarter of the Cantonment---Validity---Competent Authority, in law, while approving plan for construction could not impose conditions for obtaining No-Objection Certificate from the Station Headquarters---Even otherwise once construction plan was approved by Competent Authority according to law, presumption and logical conclusion would be that Authority must have done so by keeping in view the ground realities and the relevant legal provisions---Authority having already permitted construction of a building with ground floor plus twelve floors on a plot in immediate vicinity of plot in question, failure of said Authority to accord permission up to nine floors to petitioner was patently discriminatory and repugnant to concept of equality before law---Imposition of condition to seek No-Objection Certificate from Station Headquarter for construction beyond first floor being totally extraneous to law, and completely without jurisdiction, could not be sustained.
Amanullah Khan v. Federal Government of Pakistan PLD 1990 SC 1092; Chairman, R.T.A. v. Pak Mutual Insurance Co. PLD 1991 SC 14; Saleem Akhtar Rajput v. K.M.C. 1994 CLC 211 and K.B.C.A. v. Saleem Akhtar Rajput 1993 SCMR 1451 ref.
(b) Discretion---
---- Meaning and exercise of---Once there was more than one possible manner to take an action, an exercise of lawful discretion would mean that particular permissible option was exercised which was in the best interest of the person who vas seeking State functionary to exercise discretion---Any discretion which vested in an executive functionary had to be exercised reasonably, justly, fairly and not arbitrarily, unreasonably and in a manner totally extraneous to law and statute.
Federation of Pakistan v. Ibrahim Textile Mills Ltd. 1992 SCMR 1898 ref
Shahenshah Hussain for Petitioner
Naimur Rehman, Dy. A.-G. (on Court's Notice)
Nemo for Respondents
Date of hearing: 8th July, 1999.
P L D 2000 Karachi 58
Before Sarmad Jalal Osmany, J
Haji HAFEEZUDDIN and others---Plaintiffs
versus
LUCAS SERVICE PAKISTAN LTD. ---Defendant
Suit No.374 and Civil Miscellaneous Applications Nos.2384 and 5592 of 1999, decided on 4th August, 1999.
(a) Words and phrases---
----"Cause of action"---Meaning---Term "cause of action" would mean the bundle of facts upon which plaintiff based his claim against defendants.
(b) Civil Procedure Code (V of 1908)---
----0. II, R.2 & O.XXIII, R.1(3)---Subsequent suit---Maintainability---Cause of action in suit previously filed by plaintiff before Civil Court being entirely different from one upon which subsequent suit was based, said subsequent suit was not barred under provisions of 0.11, R.2, C.P.C. or OXXIII, R.1(3), C.P.C.
(c) Transfer of Property Act (IV of 1882)---
----S. 107---Registration Act (XVI of 1908), Ss. 17 & 49---Non-registration of compulsorily registrable documents---Effect---Any document which was compulsorily registrable and had not so been registered, would not operate to create, declare, assign, limit, whether in present or in future, any right, title or interest whether vested or contingent in immovable property---Such a document, however, could be looked into for a collateral purpose for example if a sale of property was evidenced through an unregistered document which was compulsory registrable, though that would not operate to create any right, title or interest in the property in favour of the purchaser it could be adduced in evidence so as to establish some other collateral right such as a charge on property for the amount paid by the purchaser towards the purchase of the property in question---Purchaser could always claim the sale consideration and to prove the same he could produce unregistered sale-deed in evidence.
Abdullah Bhai and others v. Ahmed Din PLD 1964 SC 106; Zarina Khawaja v. Mahboob Shah PLD 1988 SC 190; Habib Bank v. Munawar Ali Siddiqi 1991 SCMR 1185; Muhammad Rafique v. Habib Bank 1994 SCMR 1012; Feroze Khan and 4 others v. Zarman Ali and another 1993 CLC 1478; Achar and 'another v. Abu Bakr Modi 1995 CLC 465; Muhammad Yousuf Memon v. Karachi Stock Exchange 1995 CLC 183; National Bank of Pakistan v. Hashim Khan 1995 CLC 88, Muhammad Latif v. Muhammad Iqbal 1996 CLC 1672; Dr. Akhtar Hussain v. S.M. Hanif and 2 others 1990 MLD 1652; Alif Din v. Khadim Hussain 1980 SCMR 767; Muhammad Yousuf v. Abdullah PLD 1980 SC 298;. Mrs. Alima Ahmed v. Amir Ali PLD 1984 SC 32; Mst. Maqsooda Begum v. Hamid Mahmood Butt 1999 CLC 391; Mrs. Zarina Qaisha v. Arbab Wali Muhammad PLD 1976 Pesh. 128; Cotton Trading Corporation v. Sheikh Sultan Trust 1981 CLC 623 and Habib-ur-Rahman v. Wadhiara PLD 1984 SC 424 ref.
(d) Civil Procedure Code (V of 1908)---
----0. XXXIX, Rr. 1 & 2---Interim injunction, grant of---Installation of a plant by respondent/defendant in premises in question alongwith a powerful generator in a commercial area, prima facie, seemed to be in violation of zoning laws---Applicants/plaintiffs, in circumstances, had made out a reasonable prima facie case for the grant of injunction prayed for---Damage caused by potential nuisance value of the generator in question could not be quantified---Balance of convenience was also in favour of granting injunction rather than rejecting same---High Court allowed application for grant of interim injunction and respondent/defendant was restrained from installing the proposed filter assembly plant and generator within premises in question till disposal of the suit.
P.I.A. Corporation v. Hazir (Pvt.) Ltd. PLD 1993 Kar. 190 and NIX Abbasi v. United Bank Limited 1983 CLC 482 ref.
Iqbal Qazi for Plaintiffs.
Akhtar Ali Mehmood for Defendant.
Dates of hearing; 23rd, 28th and 30th April, 1999
P L D 2000 Karachi 70
Before Rasheed Ahmed Razvi and Muhammad Roshan Essani, JJ
SALEEM CHANG ---Applicant
versus
THE STATE---Respondent
Criminal Bail Applications Nos.224 and 434 of 1999, decided on 7th June, 1999.
Criminal Procedure Code (V of 1898)---
----S. 497(1), third proviso---Penal Code (XLV of 1860), S.302/148/149---Bail on ground of statutory delay---Accused had absconded after having been released from jail on a forged bail order---Despite attraction of rule of consistency, High Court declined to exercise its discretion in favour of accused on account of his abscondence---Bail was refused to accused accordingly.
Muhammad Yousuf v. The State 1983 SCMR 102; Muhammad Fazal alias Bodi v. The State 1979 SCMR 9; Abdul Salam v. The State 1980 SCMR 142; Muhammad Yousaf v. The State 1983 SCMR 102; Shahzad v. The State 1996 PCr.LJ 978; Muhammad Naseem alias Naseemo v. The State 1996 PCr.LJ 1302; Siddique alias Gaila v. The State 1997 PCr.LJ 790; Rao Qadeer Khan v. The State PLD 1981 SC 93 and Awal Gul v. Zawar Khan and others PLD 1985 SC 402 ref.
S.A. Shaukat Naqvi for Applicant.
Ghulam Mustafa Lakho for the State.
P L D 2000 Karachi 74
Before Rasheed Ahmed Razvi, J
BAHADUR KHAN NIAZI---Applicant
versus
ALAM KHAN and 2 others---Respondents
Criminal Miscellaneous Application No.435 of 1998, decided on 15th February, 1999.
(a) Criminal Procedure Code (V of 1898)---
----Ss. 497, 439 & 561-A---Conversion of one type of proceedings into other type---No bar exists in law in converting one type or kind of proceedings into other kind of proceedings provided that the jurisdiction of the Court remains intact---Bail application in a fit case can be converted into revision or into an application under S.561-A, Cr.P.C. if the dictates of justice so demand, in the absence of any express prohibition.
Mst. Akhtar Nasimi v. Martial Law Administrator, Zone 'C', Karachi and 2 others PLD 1982 Kar. 130; Erfan Shaikh and another v. The State 1971 PCr.LJ 486 and Imtiaz Ahmad v. Ghulam Ali and 2 others PLD 1963 SC 382 ref.
(b) Criminal Procedure Code (V of 1898)---
----S. 498---Pre-arrest bail on the allegations of mala fides etc. ---Guidelines provided.
If upon merits of the case, the Court comes to the conclusion that there is no sufficient material with the Prosecuting/Investigating Agency to connect accused with the alleged offence and from the material placed before such Court, it tentatively appears to be a case with reasonable doubts then in such .matters a Court may extend the concession of a pre-arrest bail to an accused on the allegations of ulterior motives, mala fides, humiliation and harassment. To reach such opinion, the Court may look into the conduct of the Prosecuting/Investigating Agency to ascertain their good faith and bona fides which can be gathered from the tentative assessment of the material collected by the Prosecuting Agency.
(c) Criminal Procedure Code (V of 1898)---
----S. 497(5)---Penal Code (XLV of 1860), 5.324---Cancellation of pre-arrest bail---Parties had a background of previous criminal litigation and old hostilities and false involvement of accused in the case could not be ruled out--Cancellation of pre-arrest bail granted to accused by Sessions Court did not appear to be just and fair after perusal of police papers and other record produced by the parties---Petition for cancellation of bail was dismissed accordingly.
Murad Khan v. Fazal-e-Subhan and another PLD 1983 SC 82; Sarwar Sultan v. The State and another PLD 1994 SC 133; Ali Muhammad v. Yamin and another 1981 SCMR 1139; Muhammad Sadiq v. Sadiq and others PLD 1985 SC 182; Mst. Bashiran Bibi v. Nisar Ahmed Khan and others PLD 1990 SC 83; Muhammad Parvez v. Badi-uz-Zaman Khan and others 1985 PCr.LJ 3007; Malik Muhammad Nawaz Khan v. The State and others 1997 PCr.LJ 390; Ijaz Ahmad v. The State 1974 SCMR 166; Mst. Akhtar Nasimi v. Martial Law Administrator, Zone 'C', Karachi and 2 others PLD 1982 Kar. 130; Erfan Shaikh and another v. The State 1971 PCr.LJ 486; Imtiaz Ahmad v. Ghulam Ali and 2 others PLD 1963 SC 382; Katbar and another v. State 1998 PCr.i.J 1438; Muhammad Fazil v. Mirza Noor Hussain and another NLR 1984 Cr.LJ 141; Mian Sherzada v. Dost Muhammad Kiryana Store and others NLR 1989 UC 253; Mian Fazal Ahmad v. Rohail Asghar 1986 PCr.LJ 1434; Meeran Bux v. The State and another PLD 1989 SC 347; Kareesh and others v. Sispal and another 1996 PCr.LJ 937; Shamsur Rehman v. Muhammad Rafiq and another PLD 1997 Kar. 194 and Jamaluddin v. The State 1985 SCMR 1949 ref.
Iktidar Ali Hashmi for Applicant.
Gul Zaman Khan for Respondents Nos to 3
Sharafat Ali Khan for the State
P L D 2000 Karachi 84
Before Muhammad Roshan Essani, J
Syed NAZIR HUSSAIN SHAH---Applicant
versus
THE STATE---Respondent
Criminal Miscellaneous No.432 and Miscellaneous Applications Nos. 3519. and 3260 of 1998, decided on 28th April, 1999.
Penal Code (XLV of 1860)--
----S. 409/420/109---Prevention of Corruption Act (II of 1947), S.5(2)--Criminal Procedure Code (V of 1898), S.561-A---Quashing of proceedings--Accused being a Customs Officer was only concerned with customs duty and other duties legally recoverable by the Customs Department---No customs duty, sales tax and excise duty were admittedly leviable on personal effects which were to be airlifted by the Airline---Investigating Agency i.e. F.I.A., Ministry of Interior and Ministry of Justice and Law had found that the accused had not contravened any law---Continuation of proceedings against the accused, in circumstances, amounted to abuse of the process of Court---Case of accused being identical to that of co-accused proceedings against whom had already been quashed, he was also entitled to same treatment on the principle of consistency---Proceedings pending against accused in the Trial Court were quashed accordingly.
Hamida v. State PLD 1973 Kar. 478 ref.
A. Q. Halepota and Abdul Haleem Pirzada for Applicant.
Syed Mamnoon Hasan, Dy. A.-G. for the State.
P L D 2000 Karachi 89
Before Nazim Hussain Siddiqui, C.J. and Ghulam Rabbani, J
JAHANGIR AKHTAR AWAN and 2 others---Petitioners
versus
THE STATE and 8 others---Respondents
Constitutional Petition No.D-991 of 1999, decided on 21st October, 1999.
(a) Penal Code (XLV of 1860)---
----Ss. 365 & 302---Anti-Terrorism Act (XXVII of 1997), Ss.6 & 38---Constitution of Pakistan (1973), Arts. 12 & 199---Constitutional petition--Retrospective punishment---Quashing of Notification and order of transfer of case to Special Court---Offence had been committed much prior to the Anti Terrorism Act, 1997 came into force and was not governed by S.38 of the Anti-Terrorism Act, 1997---Accused had killed the deceased with a hammer which was not a weapon and according to his confession he, in order to dispose of the dead body, had secretly cut it into pieces and threw the same away---All possible steps had been taken by the accused to conceal the offence---Act of accused, in circumstances, was not a terrorist act as envisaged by S.6 of the Anti-Terrorism Act, 1997---Notification and the order transferring the case to the Special Court constituted under the Anti-Terrorism Act would attract provision of Art.l2 of the Constitution---Notification and Order of transfer were consequently set aside with the direction to Sessions Judge to keep the matter on his file and decide the same on merits within a specified period.
(b) Anti-Terrorism Act (XXVII of 1997)---
----S. 6---"Terrorist Act"---Connotation---Act of terrorism is a pre-planned and organized system of intimidation, effects of which are made known to the people and widely circulated with exaggeration---Such act is neither hidden nor disguised and is committed with the sole object to terrorise the people and to feel .them insecure.
Gul Zaman Khan for Petitioners
Shaukat H. Zubedi and Muhammad Nawaz Shaikh for the Complainant/Intervenor
M. Iqbal Raad, A.-G. for the State.
Date of hearing: 16th September, 1999
P L D 2000 Karachi 94
Before Amanullah Abbasi and Wahid Bux Brohi, JJ
MUHAMMAD YOUSUF---Appellant
versus
THE STATE---Respondent
Criminal Appeal No. 14 of 1996, decided on 13th August, 1999
(a) Penal Code (XLV of 1860)---
----S. 302---Appreciation of evidence---Interested witness---Mere relationship of an eye-witness .with the deceased or his enmity with the accused by itself does not furnish a valid basis to reject his testimony---Rule of prudence, however, requires proper scrutiny of the testimony of such a witness and its corroboration before it is accepted.
Niaz v. State PLD 1960 SC 387; Sahib Masih and others v. The State 1982 SCMR 178; Ziaullah v. The State 1993 SCMR 155; Mubarak v. The State 1982 SCMR 531; PLD 1996 SC 138; Gul Khan v. The State 1999 SCMR 304 and Sharafat Ali v. The State 1999 SCMR 329 ref.
(b) Penal Code (XLV of 1860)---
----S. 302---Evidence---Burden of proof---Failure of the accused to establish his defence plea never means that the prosecution case was proved---Prosecution has to prove its case beyond reasonable doubt on the strength of its own evidence.
(c) Penal Code (XLV of 1860)---
----Ss. 302(a) & 302(b)---Appreciation of evidence---Eye-witnesses including the complainant although were closely related to the deceased and on inimical terms with the accused, yet they had given confidence inspiring evidence at the trial and their testimony, besides being inherently credible was corroborated by medical evidence as regards the time of occurrence and the weapon used in the commission of offence, the recovery of the pistol at the instance of the accused which matched with the empties secured from the place of incident and the motive which also stood proved---Accused, thus, had committed Qatl-i-Amd of the deceased but not Qatl-i-Amd liable to Qisas as exercise of Tazkiyat-ul-Shahood was not undertaken by Trial Court and it had not adverted to such aspect while recording or accepting the testimony of eye-witnesses---Conviction of accused under S.302(a), P.P.C: was consequently altered to S.302(b), P.P.C.---Motive for the occurrence, however, was ambiguous and shrouded in mystery and the accused was 20 years old at the time of commission of offence---Accused was sentenced to imprisonment for life as Tazir in circumstances.
Niaz v. State PLD 1960 SC 387; Sahib Masih and others v. The State 1982 SCMR 178; Ziaullah v. The State 1993 SCMR 155; Mubarak v. The State 1982 SCMR 531; PLD 1996 SC 138; Gul Khan v. The State 1999 SCMR 304; Sharafat Ali v. The State 1999 SCMR 329; Mushtaq Ahmed v. The State PLD 1996 SC 574; State v. Bashir and others PLD 1997 SC 408; Muhammad Aslam v. Shoukat Ali 1997 SCMR 1307; Abdul Haque v. The State PLD 1996 SC 1; Ali Muhammad v. Ali Muhammad PLD 1996 SC 274; State v. Muhammad Hanif 1992 SCMR 2047; Mudassir v. State 1996 SCMR 3 and Abdul Rauf v. State 1998 SCMR 1731 ref.
(d) Penal Code (XLV of 1860)---
----S. 302(a), (b) & (c)---Punishment of Qatl-i-Amd---Guidelines---Prosecution primarily is bound to prove positively whether the case is covered by Qatl-i-Amd liable to Qisas, not liable to Qisas or liable to Tazir---Trial Court thereafter on conclusion of the trial is required to scrutinise prudently the applicability of the exceptions contained in cls.(b) & (c) of S.302, P.P.C. and after having satisfied ,itself about the non-applicability of these exceptions, should award punishment of death as Qisas provided in cl. (a) of S.302, P.P.C.
Mudassir v. State 1996 SCMR 3 ref.
(e) Penal Code (XLV of 1860)---
----S. 302(a)---Qatl-i-Amd liable to Qisas---Exercise of Tazkiyat-ul-Shahood has to be undertaken before awarding sentence of death as Qisas i.e. while convicting the accused for the offence of Qatl-i-Amd liable to Qisas under cl.(a) of S.302, P.P.C.
Mudassir v. State 1996 SCMR 3 and Iftikhar Ahmed v. The State 1998 PCr. LJ 2022 ref.
Azizullah K. Shaikh for Appellant.
Jalil Hashmi, A.A.-G. for the State
P L D 2000 Karachi 112
Before Wahid Bux Brohi, J
MIR MUHAMMAD and another---Petitioners
versus
Mst. ASIMA BEGUM---Respondent
Civil Revision No.23 of 1994, decided on 23rd October, 1999.
(a) Civil Procedure Code (V of 1908)---
----S. 115 ,-Revision---Power of High Court---Scope---If finding on a question of fact arrived at by Lower Appellate Court was the result of conjectures, or fallacious appraisal of evidence, such finding was not immune from scrutiny by the High Court in exercise of its power under S.115, C.P.C.
Naziran Begum v. Khursheed Begum 1999 SCMR 1171 rel.
(b) Muhammadan law---
---- Pre-emption---Right of pre-emption ---Talb-e-Muwathibat---Concurrent findings of both the Courts below---Effect---Where both the Courts below had concurrently taken the view that the first demand (Talb-e-Muwathibat) was made within time, such findings were not open to interference by High Court in revision, in view of the evidence placed on record.
(c) Pre-emption---
---- Pre-emption suit---Concurrent findings of both the Courts below ---Talb-eMuwathibat and Talb-e-Ishhad, making of---Both the Courts below had examined all aspects of the evidence and reached the conclusion that the essential requirements of making both demands were fully satisfied--Effect---Not within the scope of revisional powers of High Court to have microscopic view of the evidence which had already been minutely examined and assessed by the Trial Court and the First Appellate Court---Findings of both the Courts below were neither erroneous nor perverse---No fallacious appraisal of evidence was made nor any inference was drawn by those Courts on conjectures and as such the findings did not call for interference--Vendees failed to establish that Lower Appellate Court exercised jurisdiction illegally or with material irregularity---High Court declined interference in revision.
Monajal Huq v. Shafiullah and another PLD 1964 Dacca 640; Smt. Sundri Bai v. Ghulam Hussain 1982 CLC 2441;. Samundar Khan and 2 others v. Ali Zaman PLD 1984 Pesh. 12; Muhammad Ibrahim v. Taj Muhammad and another 1985 CLC 3000; Karim Bux and 2 others v. Syed Mushtaq Ali and 2 others 1984 CLC 33; Jadal v. Majeed and 2 others PLD 1978 Kar. 732; Sudhangshu Bimal Biswas v. Muhammad Mustafa Chowdhry 1968 SCMR 213; Abdul Hakeem v. Habibullah and 11 others 1997 SCMR 1139 and KMC v. Raheel Ghayas 1995 MLD 141 ref.
G.A. Shahani for Petitioner.
Abdul Hameed Khan for Respondent.
Date of hearing: 30th August, 1999.
P L D 2000 Karachi 119
Before Wahid Bux Brohi, J
Mst. BIBI HUSAN BANO---Appellant
versus
FAZAL HUSSAIN ---Respondent
First Rent Appeal No. 105 of 1987, decided on 27th October, 1999
(a) Sindh Rented Premises Ordinance (XVII of 1979)--
----Ss. 2(f)(j), 18 & 15(2)(ii)---Change of ownership of premises--Relationship of landlord and tenant---Default in payment of rent---Landlord purchased premises in question from the original owner and served notice of change of ownership to tenant under S.18, Sindh Rented Premises Ordinance, 1979 and called upon tenant to pay rent to landlord but tenant despite said notice failed to pay rent to landlord---Landlord having stepped into shoes of original owner after purchase of premises, was entitled to receive rent from tenant---Tenant having failed to pay rent to landlord, was liable to ejectment on ground of default in payment of rent.
Muhammad Rafiq v. Messrs Habib Bank Limited 1994 SCMR 1012; Shamim Akhtar v. Muhammad Rasheed PLD 1989 SC 575; Mst. Azeem-un-Nisa Begum v. Ali Muhammad PLD 1990 SC 382; Iqbal and others v. Mst. Rabia Bibi and another PLD 1991 .SC 242; Pakistan National Shipping Corporation v. Messrs Central Service Corporation 1992 SCMR 871; Syed Azhar Imam Rizvi.v. Mst. Salina Khatoon 1985 SCMR 24; Maj. (Retd.) Muhammad Yousaf v. Mehraj-ud-Din and others 1986 SCMR 751; Salamat Jan v. Chotey Khan 1987 MLD 2971 and Tahir Hussain Malik v. Mst. Najma Rafi 1995 SCMR 1407 ref.
(b) Sindh Rented Premises Ordinance (XVII of 1979)--
----S. 15(2)(vii)---Bona fide personal need of landlord---Proof---Landlord had asserted in his affidavit-in-evidence that he had a large family of eleven persons, six sons, three daughters besides his wife; that his eldest son was married and had wife and children and that. he had no other property in area concerned or any other place to live comfortably---Such assertions of landlord were not shaken in cross-examination---Statement on oath made by landlord on issue of his personal bona fide need being consistent with ejectment application filed by him and not shaken in cross-examination Rent Controller had rightly ordered ejectment of tenant on ground of bona fide personal need of landlord.
Messrs F.K. Irani & Co. v. Begum Feroze 1996 SCMR 1178; Jehangir Rustorn Kaklia v. State Bank of Pakistan 1992 SCMR 1296; Hasan Khan v. Mrs. Munawar Begum PLD 1976 Kar. 832 and United Bank Limited v. Alafia Hussain 1999 SCMR 1796 ref.
Jhamat Jethanand for Appellant.
Raja Khan for Respondent.
Date of hearing: 14th May, 1999.
P L D 2000 Karachi 128
Before Wahid Bux Brohi, J
MUHAMMAD IBRAHIM ---Appellant
versus
THE STATE---Respondent
Criminal Appeal No. 121 of -1998(Hyderabad), decided on 13th November, 1999.
(a) Penal Code (XLV of 1860)---
----S. 302---Appreciation of evidence---Evidence of one of the prosecution witnesses read with F.I.R. and medical evidence had demonstrated a very uncertain situation---Complainant in his evidence recorded at the trial had altered complexion of prosecution story as given in F.I.R. by making a number of improvements and version given by other prosecution witness did not deserve any credit---Medical evidence did not support case of prosecution---No material corroboration was rendered to evidence of eyewitnesses whose testimonies even otherwise lacked credence---Magistrate who recorded confessional statement of accused, had admitted that after recording confession he sent the accused to judicial custody through same police official who had brought accused to him for confession---Act of handing over accused to same police official had detracted from sanctity of judicial confession as voluntariness of judicial confession which was essential prerequisite had become doubtful---Seizure memo of hatchet allegedly used in occurrence did not mention that same was stained with blood which was necessary when medical evidence had come in conflict with ocular evidence as to the nature of weapon used while causing injury---Prosecution had, thus, failed to prove motive---Accused was acquitted of the charge giving him benefit of doubt as' prosecution failed to prove the case against him.
Abdul Hakeem and another v. The State PLD 1982 Kar. 975 and Ramzan alias Jani v. The State 1997 SCMR 590 ref.
(b) Penal Code (XLV of 1860)---
----S. 302---Appreciation of evidence---Motive---Proof---Absence of evidence on point of motive, though by itself would not damage prosecution case, but- once motive was set up it was to be proved by prosecution beyond doubt and though no hard and fast rule was laid down to prove motive, but failure to furnish cogent and reliable evidence could lead to adverse inference against prosecution.
Muhammad Khan and others v. Zakir Hussain and others PLD 1995 SC 590 and Waris Ali alias Dulli and others v. The State 1999 SCMR 1469 ref.
Madad Ali Shah for Appellant.
Anwar Ansari for the State.
Date of hearing: 21st May, 1999.
P L D 2000 Karachi 139
Before M. Shaiq Usmani, J
DABUR INDIA LTD.---Plaintiff
versus
HILAL CONFECTIONERY (PVT.) LTD. ---Defendant
Civil Miscellaneous Application No.73 of 1995 in Suit No.14 of 1995 and Civil Miscellaneous Application No.1906 of 1998 in Suit No.227 of 1998, decided on 21st May, 1999.
(a) Trade Marks Act (V of 1940)---
----Ss. 20 & 73---Civil Procedure Code (V of 1908), OXXXIX, Rr. 1 & 2---Registration of trade mark---Interim injunction, grant of---Registered trade mark was assailed by the petitioner on the ground of infringement--Validity---Once a trade mark had been registered the proprietor had exclusive right to its use because if it were otherwise then there would be no purpose in registration of a trade mark in the first instance---Registration of trade mark did not constitute final appropriation of the mark and the same could be challenged either in appeal or under the provisions of Trade Marks Act, 1940---Use of a trade mark by a registered proprietor could not be regarded as infringement of the mark, till the, time such mark was rectified or cancelled---Interim injunction was not granted in circumstances.
(b) Trade Marks Act (V of 1940)--
----Preamble---Expression "passing off" as used in Trade Marks Act, 1940--Connotation and applicability---Passing off in the traditional sense is primarily concerned with -unfair competition between the traders---Question of deception of the public which may be caused by passing off the goods is not of that importance because passing off action, is normally not an action which is brought by a member of the public on the ground that such person was deceived but it is brought by the . traders because such trader fears that his trade will suffer from the deception that is being practised on the public--- "Passing off" is a question of trade rivalry rather than of deception and a case of dishonesty inasmuch as another party tries to take advantage of the efforts and the expenditure made and incurred in developing a product by another party.
1987 SCMR 1090 ref.
(c) Trade Marks Act (V of 1940)---
----Preamble---Expression "spill over advertisement" ---Connotation--Concept of spill over advertisement is that it is not a direct advertisement but one finds its way amongst people in different lands through media.
William Grant & Sons v. McDowell & Co. Ltd. 1994 FSR 690 ref.
(d) Trade Marks Act (V of 1940)---
----Preamble---Expression "unfair trade" and "unfair competition"--Comparison---Terms "unfair trade" and "unfair competition" are treated interchangeably---Both relate to interference with the business of another by wrongful acts, including gleaning trade secrets by subterfuge by which the goodwill of a business is appropriated or art unfair advantage gained
'Corpus Juris Secundum rel.
(e) Trade Marks Act.(V of 1940)---
----Ss. 20(2) & 73---"Passing off" actions---Essential ingredients of passing off, enlisted.
Five characteristics which must be present in order to create a valid cause of action' for passing off are: (i) a misrepresentation; (2) made by a trader in course of trade: (3) to prospective customers of his or ultimate consumers of goods or services supplied by him; (4) which is calculated to injure the business or goodwill of another trade (in the sense that this is a reasonably foreseeable consequence) and (5) which causes actual damage to a business or goodwill of the trader by whom the action is brought or who will probably do so.
(f) Trade Marks Act (V of 1940)---
----Ss. 20(2) & 73---"Passing off" in Trans Border Reputation---Scope--Issue in case of Trans Border Reputation is not deception but the frayed corporate ego of the giant trader and his desire to maintain the exclusivity of his goods being sold under his mark as the same impels him to prevent its use by the ordinary traders---Use of trade mark with a Trans Border Reputation by a small trader in a different country did not constitute "passing off" in the traditional sense and in such a situation the same has to be re-defined and may even be given a new name to distinguish the same---Term "Traps passing off" could be used for such a situation.
(g) Trade Marks Act (V of 1940)---
----S. 20(3)---"Traps passing off" as used in Trade Marks Act, 1940--Connotation and applicability---Where the attempt of a trader is to initiate is dishonest and deliberate and is with a view to make unlawful gains, then obviously it will fall in the category of "trans passing off'---Where the element of dishonesty and deliberate attempt to do is missing, then the same may not be a "trans passing off".
(h) Trade Marks Act (V of 1940)---
----Ss. 20(2) & 73---Traps Border Reputation of a trade mark---Proof--Where the entrepreneur/manufacture relies on such reputation to prevent the offending party from using its mark then such party must show that the concept of Trans Border Reputation is also recognised under that country's laws.
(i) Trade Marks Act (V of 1940)---
----Ss. 20(2) & 73---Civil Procedure Code (V of 1908), OXXXIX, Rr.l & 2---Interim injunction, grant of---Case of infringement of trade mark coupled with "passing off"---Trade mark of the plaintiff was not registered in Pakistan but had a Trans Border Reputation in so far as Pakistan was concerned---Products of the plaintiffs were very well known in Pakistan due to spill over advertising and introduction of the satellite television---Trade mark in dispute was registered by someone else in Pakistan and the same was acquired by the defendants---Validity---Such acquisition of the defendants indicated that they were not the users of the disputed mark for as long as they claimed but was an attempt on the part of the defendants to take advantage of the Trans Border Reputation of the trade mark of the plaintiffs and as such it was dishonest---Plaintiffs had made out their prima facie case for trans passing off and suffering of considerable loss by them, was also established---Balance of convenience was entirely in favour of the plaintiffs and element of reciprocity also existed as the concept of Traps Border Reputation was recognised under the law of the country of the plaintiffs--Interim injunction was granted in circumstances.
1987 SCMR 1090; Famous and Well Known Marks an International Analysis by Frederick W. Moslert; Scotch Whisky Association v. Mohan Meakin Ltd. 1993 IPLR 1863; Kamal Trading Company -v. Gillette U.K. Ltd. 1988 IPLR 135 and Erven Warnink B.V. and another v. J. Townend and Sons (Hulf) Ltd. 1980 RDC 31 ref.
(j) Copyright Ordinance (XXXIV of 1962)---
----S. 54---Trade Marks Act (V of 1940), Ss.20(2) & 73---Copyrights to foreign marks ---Berne Convention---Effect---Plaintiffs were legal owners of copyrights of "Hajmola" candy wrappers in India---Contention raised by plaintiffs was that as Pakistan was signatory to Berne Convention, therefore, plaintiffs were entitled to copyright protection in Pakistan ---Validity--Copyright in Pakistan was governed under the provisions of Copyright Ordinance, 1962 and under S.54 of Copyright Ordinance, 1962, the plaintiffs were entitled to such protection.
(k) Trade Marks Act (V of 1940)---
----Ss. 20(2) & 73---Civil Procedure Code (V of 1908), O. XXXIX, Rr. 1 & 2---Infringement of trade mark with passing off---Interim injunction, grant of ---Trans Border Reputation of a trade mark---Failure to point out element of dishonesty in the use of such trade mark by the defendants ---Effect--Defendants had been using the disputed mark since 1988 for a different product and the same was being done openly and not surreptitiously--Disputed trade mark was registered in the name of the defendants despite opposition of the plaintiffs--Element of dishonesty was not possible for the Court to determine at interlocutory stage---Where the plaintiffs failed to show that the concept of Trans Border Reputation was recognised in their country the element of reciprocity was missing---Plaintiffs having failed to make out a prima facie case of passing off as well as of infringement, interim injunction was refused in circumstances.
Sharifuddin Pirzada with Hassan Irfan Khan for Plaintiffs (in Suit No. 14 of 1995).
Khalil Qazilbash for Defendants (in Suit No. 14 of 1995).
Hassan Irfan Khan for Plaintiffs (in Suit No.227 of 1998).
Khalil Qazilbash for Defendants (in Suit No. 227 of 1998).
P L D 2000 Karachi 154
Before Nazim Hussain Siddiqui, CJ and Ghulam Rabbani, J
FARUKH DIN and others---Petitioners
versus
GOVERNMENT OF SINDH and others---Respondents
Constitutional Petitions Nos.D-541, 567, 639, 647, 678, 679, 680, 735, 736, 737, 795, 796, 797, 798 and 799 of 1999, decided on 6th October, 1999.
(a) Board of Intermediate and Secondary Education, Larkana---
----Vol. III, R. 22---Constitution of Pakistan (1973), Art.199--Constitutional petition---Detection of mistake in result at a later stage--Rectification---Revising of result---Issuance of notification for such revision of result without affording opportunity of being heard to the candidates--Validity---Education Board, in view of its authority under Vol. III, R.22 of Board of Intermediate and Secondary Education, Larkana issued such notification in respect of candidates to deposit their marks/pass certificates issued to them and to receive fresh certificates---Validity---Where such notification was issued after full-fledged inquiry, nothing was wrong in that notification---Education Board had the jurisdiction to rectify the mistake detected at later stage---Where at the time of enquiry proceedings it was not known to the Authorities that as to who were those candidates, . w(to were involved in committing forgery in the record of the Board,- the question of affording opportunity of being heard to the candidates, before the enquiry proceedings were initiated, would not arise at all---After issuance of such notification, show-cause notices were issued to the candidates to explain their position but stone of them seriously contested the findings of such enquiry report and merely relied upon the technicalities---High Court, after having seen the original registers, was of the opinion that forgery was committed and interpolations were made therein---Enquiry Committee had, thus, rightly noted that rubbing, cutting and overwriting were common features in the ledgers, tampering with documents was done with the connivance of the staff of the Board---Where any right emanated from forgery. fraud and misrepresentation, such was not a legal right---Constitutional petition was dismissed in limine in circumstances.
Faiza Malik v. Chairman, Board of Intermediate and Secondary Education. Lahore and 2 others PLD 1992 SC 324; Mrs. Anisa Rehman v PIAC and others 1994 SCMR 2232; Jawad Habib v. Secretary, Education Department, Government of N.-W.F.P., Peshawar and 6 others 1998 MLD 17; Punjab Engineering College, Chandigarh v. Dharminder Kumar Singhal and others 1990 AIEC 75 (SC): Chairman, Board of Mining Examination and Chief Inspector of Mines and mother v. Ramjee AIR 1977 SC 965; Union of India and another v. Tulsiram Patel AIR 1985 SC 1416; R.S. Dass v. Union of India and others AIR 1987 SC 593; Abdul Qadir and others v. The Settlement Commissioner and others PLD 1991 SC 1029 and Rehana Mehmood and 3 others v. Azad Government and 5 others 1997 MLD 2874 ref.
(b) Words and phrases--
......Legal right"---Connotation---Legal right is one which is enforceable before Courts and is based upon statute and is invoked for having secured interest.
Abrar Hassan, Fareed A. Dayo, Gul Bahar Korai, Ghulam Qadir Jatoi and M.L. Shahani for Petitioners.
Iqbal Raad, A.-G. Sindh.
Illahi Bux M. Kehar for Respondents Nos. 1, 2 and 3.
Dr. Mehboob Ali Shaikh, Chairman, Board of Intermediate and Secondary Education, Larkana (in person).
Barkat ali Mehar, Assistant Controller of Examinations H.S.C. Secret, BISE, Larkana.
Date of hearing: 13th August, 1999.
P L D 2000 Karachi 161
Before S. Ahmed Sarwana, J
FOUR SQUARE ENTERPRISES---Plaintiff
versus
KARACHI BUILDINGS CONTROL AUTHORITY---Defendant
Suit No.877 and Civil Miscellaneous Applications Nos. 6468 and 5616 of 1997, decided on 17th January, 2000.
Specific Relief Act (I of 1877)---
----Ss. 42 & 54---Civil Procedure Code (V of 1908), O.VII, R.11---Sindh Buildings Control Ordinance (V of 1979), S.20-A---Suit for declaration and Perpetual injunction---Maintainability---Rejection of plaint---Suit was filed without first giving notice to defendant-Authority under S.20-A, Sindh Buildings Control Ordinance, 1979, since no suit could be filed against defendant-Authority except after expiry of sixty days' written notice delivered to or left at the Office of Authority, suit filed by plaintiff was not maintainable---Mandatory provision of law having not been complied with plaint was rejected especially when plaintiff had not come up before Court with clean hands and had no cause of action against defendant Authority.
Government of the Province of Bombay v. Pestonji Ardeshir Wadia and others AIR 1949 PC 143; Muhammad Ilyas Hussain 'v. Cantonment Board, Rawalpindi PLD 1976 SC 785; Mst. Zainab Hajiani v. Al-Hilal Cooperative Housing Society and 2 others PLD 1978 Kar. 848; Pakistan Railways v. Karachi Development Authority and 5 others PLD 1992 Kar. 71; Zia-ur-Rehman Alvi v. Allahabad Cooperative Housing Society Ltd. and 2 others PLD 1995 Kar. 399; Syed Azhar Imam Rizvi v. Mst. Salma Khatoon 1985 SCMR 24; Muhammad Bux v. Karim Bux 1987 CLC 13 and Syed Monawar Ali v. Tariq 1993 CLC 349 ref.
M. Aziz Malik for Plaintiff.
Nairmur Rehman for Defendant.
Dates of hearing: 9th and 23rd September, 1999.
P L D 2000 Karachi 168
Before S. Ahmed Sarwana, J
Dr. ZAHIR ANSARI and others---Plaintiffs
versus
KARACHI DEVELOPMENT AUTHORITY and others---Defendants
Suit No.813 and Civil Miscellaneous Applications Nos.5884 of 1995 and 5977 of 1997, decided on 17th January, 2000.
(a) Specific Relief Act (I of 1877)---
----S. 42---Cooperative Societies Act (VII of 1925), Ss. 70 & 70-A---Suit for declaration against Cooperative Housing Society ---Maintainability--Plaintiffs, who were residents and owners of houses situated in the Housing Society, had filed suit alleging that Society in collusion with Authorities had prepared a revised lay-out plan for converting land reserved for parks/amenity plots into residential plots---Plaintiffs had prayed that act of defendant-Society in collusion with Authorities, be declared illegal, void, mala fide, ultra vires and. without lawful authority---Suit was resisted on ground that it was not maintainable as same was filed without giving sixty days' notice to Registrar of the Cooperative Society under S.70 of Cooperative Societies Act, 1925---Validity---Primary object of suit was to get a declaration from the Court that Society in collusion with Authorities and in violation of law, had changed use of land and converted amenity plots into residential ones---No notice under S.70, Cooperative Societies Act, 1925, was necessary when plaintiffs wished to attack in a Civil Court mala fide conduct of Authority which had nothing to do with working or the business of the Society especially when plaintiffs had challenged mala fide and illegal act of Authority in changing use of land and in converting amenity plots into residential ones arid ownership documents in collusion with Society---Provisions of S.70-A of Cooperative Societies Act, 1925 would also not come in the way of plaintiffs---Objection of defendant that plaintiffs had not shown any right in property which had been breached, was repelled, because every citizen had the right to live in a clean and decent environment and had the right to ensure that public Authorities' act was in accordance with law and did not violate any provision of law which could affect public-at-large.
1996 MLD 593; PLD 1995 Kar. 399; 1995 MLD 399; AIR 1941 Nag. 364; PLD 1969 Kar. 474; PLD 1965 SC 698; PLD 1965 SC 671; 1974 SCMR 356; 1997 CLC 962; PLD 1995 SC 530; PLD 1991 SC 14; 1990 CLC 83; 1990 CLC 448 and Ardeshir Cowasjee v. KBCA 1999 SCMR 2883 ref.
(b) Void order.
---Consequences---If on basis of a void order, subsequent orders have been passed either by the same Authority or by other Authorities, whole series of such orders together with superstructure of rights and obligation built upon them, must unless some statute or principle of law recognizing as legal the changed position of the parties was in operation, would fall to the ground because such orders had as little legal foundation as the void order on which they were founded---Anything done contrary to Regulations could not be regularized.
Yousaf Ali v. Muhammad Aslam Zia PLD 1958 SC 104; Mansab Ali v. Amir and 3 others PLD 1971 SC 124; Abdul Razak v. KBCA PLD 1994 SC 512 and Ardeshir Cowasjee v. Karachi Building Control Authority 1999 SCMR 2883 ref.
(c) Civil Procedure Code (V of 1908)---
----0. XXXIX, Rr. 1 & 2---Specific Relief Act (I of 1877), S.42--Temporary injunction, grant of---Plaintiffs/petitioners in their suit for declaration had prayed that conversion of land reserved for parks/amenity plots into residential plots, be declared illegal, void and without lawful authority and pending suit had. sought temporary injunction in that respect--Petitioners had made out more than a prima facie case for grant of temporary injunction because alleged change of use of land from its original purpose o1 amenities and utilities to residential plots was patently illegal---Not only petitioners but all inhabitants of area would suffer irreparable loss if respondents were allowed to raise construction in area earmarked for purposes of amenities, utilities and open space as they had a vested right in Housing Scheme and their rights to enjoy benefits of amenities would be affected which could not be compensated in terms of money---Even otherwise allowing construction on unlawfully converted plots would amount to putting premium on wrongdoing---Balance of convenience was also in favour of petitioners, because if said injunction was not granted and respondents were allowed to raise construction or deal with plots in question, it would cause great inconvenience to defendants/respondents themselves and owners and residents of houses in the Housing Society--Defendants/respondents were ordered to restrain from raising any future construction on plots in question till final decision of suit.
Suleman Mala v. Karachi Buildings Control Authority 1990 CLC. 448 ref.
Khawaja Shamsul Islam for Plaintiff. .
Amir Hani Muslim for. Defendants Nos. 3 to 5.
Muhammad Ali Jan for Defendants Nos.6, 10(p), (a), (aa), (bb) and (cc).
Farrukh Zia Shaikh, Advocate.
Aamer Raza Naqvi for the K.D.A.
Naimur Rehman : Amicus curiae.
Dates of hearing: 19th and 27th August, 1999.
P L D 2000 Karachi 181
Before Saiyed Saeed Ashhad and Ghulam Rabbani, JJ
REHMAT KHAN---Petitioner
versus
D.G., INTELLIGENCE AND INVESTIGATION (CUSTOMS AND EXCISE)---Respondent
Constitutional Petition No. D-1922 of 1999, decided on 31st January, 2000.
(a) Criminal Procedure Code (V of 1898)---
----S. 403---Constitution of Pakistan (1973), Art.13---Two trials for one offence---Validity---One shall not be vexed twice for one -and the same cause.
Mark Mifsud Mrs. Rosemarie Morley and 2 others v. Investigating Officer, Customs PLD 1-999 Kar. 336 ref.
(b) Criminal Procedure Code (V of 1898)---
----S. 403---Customs Act (IV of 1969), Ss.2(s), 16, 178 & 156(1)(8)(82)(89)---Control of Narcotic Substances Act (XXV of 1997), S.9(c)---Constitution of Pakistan (1973), Arts.13 & 199---Constitutional petition---Doctrine of double jeopardy---Applicability-=-Narcotic was recovered from petitioners in departure hall of the International Airport--Department had initiated two trials one before the Special Judge (Customs and Taxation) under Ss.2(s), 16, 178, 156(1)(8)(82)(89), Customs Act and the other before Special Judge under S.9(c) of Control of Narcotic Substances Act, 1997---Application under S.265-K, Cr.P.C. filed by the petitioners before the Special Judge was dismissed---Contention by the Department was that without conviction or acquittal , by the Court of competent jurisdiction, petitioners could nor be said to have faced double jeopardy---Validity---Trial in the Court of Special Judge (Customs and Taxation) would either result in conviction or acquittal on the basis of facts, evidence and alleged recovery in the case while the other trial under S.9(c) of Control of Narcotic Substances Act, 1997. in presence of same facts and in same set of evidence by the Special Judge, would patently result in a duplicate punishment or at least a duplicate trial in violation of the doctrine of double jeopardy---Aggrieved person could seek the quashing of such proceedings without first having been convicted or acquitted for the same offence by a Court of competent jurisdiction---Proceedings under Ss.6 & 9(c) of Control of Narcotic Substances Act, 1997, pending before the Special Judge; were ordered to be quashed---Petition was allowed accordingly.
Mark Mifsud Mrs. Rosemarie Morley and 2 others v. Investigating officer Customs PLD 1999 Kar. 336 fol.
Ilamdin Khattak for Petitioners.
Naimur Rahman, Dy. A.-G.
Date of hearing: 24th December, 1999,
P L D 2000 Karachi 186
Before S.A. Sarwana, J
HABIB BANK LIMITED---Decree-Holder
versus
Messrs DOST MUHAMMAD COTTON MILLS and 3 others---Judgment-Debtors
Execution No.91 of 1996 and Civil Miscellaneous Applications Nos.44 and 449 of 2000, decided on 9th March, 2000.
(a) Banking Companies (Recovery of Loans, Advances, Credits and Finances) Act (XV of 1997)--
----S. 14---Civil Procedure Code (V of 1908), O.XXXIV, R.2---Passing of preliminary decree by Banking Court established under the provision of Banking Companies (Recovery of Loans, Advances, Credits and Finances) Act, 1997--Requirement---Banking Court is not required to pass a preliminary decree as provided in O.XXXIV, R.2, C.P.C. but is empowered to pass a final decree for sale under S.14, Banking Companies (Recovery of Loans, Advances, Credits and Finances) Act, 1997.
(b) Banking Companies (Recovery of Loans, Advances, Credits and Finances) Act (XV of 1997)---
----S. 18---Civil Procedure Code (V of 1908), O. XXI---Execution of decree---Procedure to be followed by Banking Court---Applicability of O.XXI, C.P.C.---Banking Court has been empowered to follow the procedure laid down in C.P.C., for execution of decree or in any other manner as the Court may deem fit---Provisions of O.XXI, C.P.C. are not mandatory and Court can follow any reasonable procedure.
(c) Banking Companies (Recovery of Loans, Advances, Credits and Finances) Act (XV of 1997)---
----S. 18---Civil Procedure Code (V of 1908), O.XXI---Execution of decree---Procedure to be followed by Banking Court---Non-compliance of procedure laid down in O.XXI, C.P.C.---Effect---Banking Court has been granted special powers and wide discretion to follow such procedure which ensures expeditious recovery of Bank loans without doing injustice to any party---Where the procedure laid down in O.XXI, C.P.C. comes in the way of expeditious disposal and speedy recovery, it is not mandatory to follow the same---Banking Court is free to follow any procedure which it deems fit in the circumstances of the case for recovery. of Bank loans so long as it does not violate Fundamental Rights guaranteed by the Constitution and the principles of natural justice.
(d) Civil Procedure Code (V of 1908)---
----0. XXI & S. 42-Execution of decree---Executing Court cannot go / behind the decree.
(e) Banking Companies (Recovery of Loans, Advances, Credits and Finances) Act (XV of 1997)---
----S. 18---Civil Procedure Code (V of 1908), O.XXXIV, R.12---Execution of decree---Dual charge on suit property---Objection was raised to the selling of suit property in execution proceedings to the effect that the decree-holder Bank did not have a right to sell the property as another Bank had a prior charge on the same property=--Validity---Provision. of O.XXXIV, R.12, C.P.C. did not forbid the Court from selling the property---Where, however, the property was subject to prior mortgage, the same could be sold with the consent of the prior mortgagee subject to his priority in the sale proceeds--Objection being based on misunderstanding of law, was set aside.
Mst. Razia Ghafoor v. Messrs Eastern General and others 1987 CLC 777 ref.
(f) Civil Procedure Code (V of 1908)---
----S. 73---Distribution of proceeds of sale in execution proceedings among decree-holders---Such proceeds are to be rateably distributed among the decree-holders subject to the law of priorities---Preference was to be given to the first mortgagee over the rights of the mortgagees following him unless all the mortgagees have agreed otherwise in writing.
(g) Civil Procedure Code (V of 1908)---
----0. XXI---Execution of decree---Courts were to do justice and not to allow technicalities to come in their way and deprive other decree-holders of fruits of their decrees.
Azizur Rehman for the Decree-Holder.
Dasti Muhammad Ibrahim for the Objector Ejaz Ahmad Khan.
Iftikhar Javed Qazi for the Objector-Tenant.
Bashir A. Memo, Official Assignee.
P L D 2000 Karachi 192
Before Nazim Hussain Siddiqui, J
J.N. NICHOLS (VIMTO) PLC A COMPANY INCORPORATED IN THE UNITED KINGDOM---Plaintiffs
versus
MEHRAN BOTTLERS (PRIVATE) LIMITED, KARACHI---Defendant
Suit No. 102 of 1992, decided on 13th January, 1994.
(a) Trade Marks Act (V of 1940)---
----S. 23---Trade mark, registration of ---Prima facie evidence of validity--Scope---Registered trade mark can be exclusively used by its proprietor till the registration continues---Registration of a trade mark is prima facie evidence of validity.
(b) Trade Marks Act (V of 1940)---
----Ss., 21 & 57---Infringement, test of---Onus to prove---Scope---Test, in case of infringement -of trade mark is whether the unwary purchaser is likely to be deceived into purchasing the goods of the person infringing the trade mark as the goods of the proprietor of the trade mark---Initially the onus that the defendant's mark is likely to deceive or cause confusion lies on the plaintiff and when ex facie some resemblance is found to exist between two marks then it is for the defendant to establish that two marks are so dissimilar that there is no possibility of anybody being deceived on the basis of defendant's mark.
(c) Trade Marks Act (V of 1940)---
----Ss. 21, 73 & 79---Suit for infringement of trade mark---Trade usage--Proof---Scope---Where the disputed trade mark had been registered. in the names of the plaintiffs for seven years, after such time the registration had become conclusive as to its validity---Plaintiffs were entitled to sue for infringement without being liable to prove user in circumstances.
(d) Trade Marks Act (V of 1940)---
----S. 6---Determination of question of similarity of two marks---Principles.
Following are the principles to be followed while determining the question of similarity of two trade marks:--
(a) What is the main idea or the salient feature?
(b) Marks are remembered by general impressions or by some significant detail rather than by a photographic recollection of the whole.
(c) Overall similarity is the touchstone.
(d) Marks must be looked at from the view and first impression of a person of average intelligence and imperfect recollection.
(e) Overall structures, phonetic similarity and similarity of idea are important and both visual and phonetic tests must be applied.
(f) The purchaser must not be put in a state of wonderment.
(g) Marks must be compared as a whole, microscopic examination being impermissible.
(h) The broad and salient features must be considered for which marks must not be placed side by side to find out differences in design.
(i) Overall similarity is sufficient.
(e) Trade Marks Act (V of 1940)---
----Ss. 21 & 73---Civil Procedure Code (V of 1908), O.XXXIX, Rr. 1 & 2---Suit for infringement of trade mark---Interim injunction, grant of--Plea of balance of convenience---Scope---Where a strong prima facie case was made out in favour of. the plaintiffs, in such situation the balance of convenience went into backgrounds---Defendants could not be permitted to take advantage of their own mischief by raising the plea of balance of convenience as the plaintiffs were likely to suffer irreparable loss---Interim injunction was confirmed by High Court in circumstances.
(f) Trade Marks Act (V of 1940)---
----Preamble---Invented word as used in the Trade Marks Act, 1940--Connotation---"Invented word" must be .a word having no meaning or no obvious meaning, until one has been assigned to it. -
(g) Trade Marks Act (V of 1940)---
----S. 46---Civil Procedure Code (V of 1908), O.XXXIX, Rr. 1 & 2--Rectification and correction of Register of Trade Marks ---Remedy--Application for injunction---Scope---Proper remedy for. rectification and correction of the Trade Mark Register is to take up the matter before the relevant Authority under the provisions of S.46 of Trade Marks Act, 1940--Such point cannot be resolved in application for injunction, as the same may have an adverse effect on the case of any of the contesting parties.
(h) Trade Marks Act (V of 1940)---
----S. 21---Trade mark, becoming of publici juris---Scope---Mere adverse user unknown to the owner of the trade mark' will not make the mark publici juris.
(i) Words and phrases--
----"Invented ----"Invented words"---Connotation.
Formica Corporation v. Pakistan Formica Ltd. 1989 SCMR 361 ref.
Abdul Hameed Iqbal for Plaintiff.
Khalil Kazilbash for Defendant.
Date of hearing: 26th May, 1993.
P L D 2000 Karachi 198
Before Syed Deedar Hussain Shah, C J
THE STATE---Appellant
versus
BASHIR AHMAD CHAUDHRY and others---Respondents
Special Criminal Miscellaneous Nos. 2 of 1995; Special Acquittal Appeals Nos. 13, 25, 31 of 1996; 7, 14, 15, 21, 23 and 43 of 1997, decided on 22nd March, 2000.
Customs Act (IV of 1969)---
----S. 185-F(1)---Central Law Officers Ordinance (VII of 1970), S.4-A [as inserted by Central Law Officers (Amendment) Act (XVII of 1985)]--Criminal Procedure Code (V of 1898), Ss. 417 & 492---Appeal against acquittal ---Authority to file such appeal---Appeal against acquittal having not been filed and signed by any of the Law Officers authorised under S.4-A, Central Law Officers Ordinance, 1970, was not maintainable---Such appeal could not be filed 'by "any person" as mentioned in S.185-F(1), Customs Act, 1969.
Christopher Rollins Kelly and 2 others v. State 1997 PCr.LJ 51 and State through Advocate-General, Sindh v. Hanif Ahmad and others 1994 SCMR 749 fol.
Liaqat Ali and 11 others v. The State 1992 SCMR 372; The State through Public Prosecutor v. Shoukat Ali 1998 PCr.LJ 1503; Christopher Rollins Kelly and 2 others v. State 1997 PCr.LJ 51 and State through Advocate-General, Sindh v. Hanif Ahmad and others 1994 SCMR 749 ref.
Ch. Muhammad Iqbal. Standing Counsel.
Fariduddin, Advocate.
Sohail Muzaffar, Advocate.
Abdul Ghafoor Mangi, Advocate.
Pervez Mustafa, Advocate.
Mir Nawaz Khan Merwat, Advocate.
Syed Sami Ahmad, Advocate.
Muhammad Arif Latif, Advocate.
S.M. Iqbal, Advocate.
Sardarduddin W. Qureshi, Advocate.
P L D 2000 Karachi 203
Before Wahid Bux Brohi, J
HIMATH ALI and others---Petitioners
versus
MUHAMMAD PARYAL and others ---Respondents
Civil Revision No.75 of 1994, heard on 16th August, 1999.
(a) Land Reforms Regulation, 1972 (M.L.R.115)--
----Para. 25 [as amended by Land Reforms Ordinance (XX of 1976)]---Preemption right on the basis of tenancy---Claim of the pre-emptor was dismissed by Mukhtiarkar on 10-5-1976 by an order passed in original jurisdiction---Such order was reversed by the Collector as Appellate Authority in favour of the pre-emptor---Decision in appeal was upheld by the Commissioner as well as by the Member, Board of Revenue ---Vendee assailed the judgment of Revenue Authorities in civil suit on the ground that when the Collector had passed the order in appellate capacity the law had been amended and the Collector possessed no such jurisdiction and the remaining orders of the Commissioner and the Member, Board of Revenue were without jurisdiction and illegal---Trial Court decided the matter in favour of the vendee but the Lower Appellate Court, set aside the judgment and decree of the' Trial Court and upheld the decision of the Member, Board of Revenue ---Validity---Order of the Collector acknowledging the right of preemption in appellate capacity was without jurisdiction---All the orders passed by the Revenue Authorities based on the order of the Collector were without jurisdiction, illegal and conferred no legal right on the pre-emptor, in circumstances and order of the Mukhtiarkar held the field---Findings of the Lower Appellate Court in that context could not be sustained and were set aside in circumstances.
(b) Land Reforms Regulation, 1972 (M.L.R.115)---
----Para; 25 [as amended by Land Reforms Act (XLVIII of 1976)]---Civil Procedure Code (V of 1908), S.115---Right of pre-emption on the basis of tenancy---Declaring of Law Reforms Regulation, 1972 as repugnant to Injunctions of Islam ---Effect---Pre-emptor claimed his right of pre-emption on the suit land on the basis of tenancy---If the pre-emptor failed to obtain a valid decree in respect of his right of pre-emption as tenant before 31-7-1986, he was not entitled to such right---Suit of the vendee was rightly decreed and the orders of the Revenue Authorities were illegal, void and mala fide ---Judgment and decree passed by Lower Appellate Court accepting the right of pre-emption of the pre-emptor on the basis of the decisions of the Revenue Authorities were set aside in circumstances.
Government of N.-W.F.P. v. Malik Said Kamal Shah PLD 1986 SC 360; Sardar Ali v. Muhammad Ali PLD 1988 SC 287; Mst. Chaghi v. Bachoo PLD 1984 Quetta 92; Muhammad Farash Khan v. Mst. Nishadar Jan PLD 1983 SC (AJ&K) 43; National Bank of Paksitan v. Humayun Sultan Mufti 1984 CLC 1401; Sher Muhammad v.Munir Ahmed 1978 SCMR 167; Nawab Khan v. Waris Iqbal c'LD 1976 SC 394; Shah Muhammad v. Mst. Maqsooda Begutn 1988 CLC 412; Hamid Hussain v. Government of West Paksitan 1974 SCMR 356; Syed Raunaq Raza v. Province of Sindh 1994 CLC 317 and Bashir Ahmed v. Manzoor Ahmad 1987 SCMR 1620 ref.
Ghulam Sarwar Abbasi for Petitioners.
Moohanlal for Respondents.
Date of hearing: 16th August, 1999.
P L D 2000 Karachi 214
Before Shabbir Ahmed, J
Messrs MARINE MANAGEMENT COMPANY through Proprietor---Plaintiff
versus
GOVERNMENT OF PAKISTAN through Secretary, Ministry of Defence, Rawalpindi and 2 others---Respondents
Civil Suit No. 158-Q of 1995, decided on 4th October, 1999.
(a) Limitation Act (IX of 1908)---
----Art. 23---Malicious prosecution---Limitation---Filing of appeal or revision against order of acquittal---Effect---Limitation for suits for malicious prosecution is one year, when the plaintiff is acquitted or prosecution-is otherwise terminated---Filing of revision against the order of acquittal cannot suspend the period of limitation, which starts running from the date of order of acquittal.
Shankar Parshad v. Sheo Narian AIR 1935 Oudh 392; Madho Lal v. Hari Shankar AIR 1963 All. 547; Madan Mohan Singh v. Ram Sundar Singh AIR 1930 All. 326; Jagat Ram v. Mst. Ghani Dulaiya and another AIR 1938 All. 49 and Abdul Ghani v. Province of Pakistan PLD 1975 Lah. 1238 ref.
(b) Limitation Act (IX of 1908)---
----Art. 23---"Acquittal" as used in Art. 23, Limitation Act, 1908---Meaning---Term "acquittal" means acquittal from Trial Court or if there is a conviction from Trial Court, then order of acquittal passed in appeal or revision.
(c) Limitation Act (IX of 1908)---
----Art. 23---Malicious prosecution---Limitation---Filing of suit after dismissal of appeal -Criminal proceedings against the plaintiff were quashed by High Court and the prosecution went in appeal before Supreme Court--Appeal was also dismissed by Supreme Court ---Plea raised by the defendants was that the suit should have been filed after the order of quashment passed by High Court and as such the period of limitation had expired as the same was filed after the dismissal of appeal by Supreme Court---Validity---Where the appeal before Supreme Court was not treated as prosecution, then discharged person would be compelled to initiate a suit for damages, even though the matter was still sub judice before the Supreme Court and it seemed extraordinary that the plaintiff should be compelled to sue, while it was yet a question whether his retrial was going to be ordered---Period of limitation of one year would start from the date of the order of Supreme Court and the present suit was within time.
(d) Civil Procedure Code (V of 1908)---
----0. VII, R.1(e)---Suit for malicious prosecution---Cause of action ---Scope--Where F.I.R. was lodged against plaintiff (owner of trawler) and his crew members, but the proceedings initiated on the F.I.R. were quashed, such facts did constitute cause of action---Cause of action meant every fact, which was necessary to give action to and formed foundation of the suit.
(e) Malicious prosecution---
---- Proof of---Plaintiff has to prove that he was prosecuted by the defendant on criminal charge; that prosecution terminated in favour of the plaintiff; that the prosecution was malicious and the prosecution was without reasonable or probable cause.
(f) Words and phrases---
----"Malicious"---Connotation.
Tempest v. Snowden (1952) 1 KB 130; Abdul Shakoor v. Lipton & Co. AIR 1924 Lah. 1; Noor Khan v. Jiwandas AIR 1927 Lah., 120; Madras V.T. Srinivasa Thathachariar v. P. Thiruvenkatachariar AIR 1932 Mad. 601; Balbabaddar Singh v. Badari Sah AIR 1926 PC 46; Raja Braja Sunder Deb v. Bandeb Das AIR 1944 PC 1; Abdul Rasheed v. State Bank of Pakistan PLD 1970 Kar. 344; Muhammad Amin v. Zaman Ali PLD 1990 SC 280; Abdul Rauf v. Abdul.Razaq PLD 1994 SC 476 and United Bank v. Raja Ghulam Hussain 1999 SCMR 343 ref.
(g) Words and phrases---
------ Reasonable and probable cause" ---Meaning.
Hicks v. Faulkner (1881) 8 QBD 167 and Lord Develin v. Melver in Glinski 1962 AC 726 ref.
(h) Malicious prosecution---
----Damages---Malice against defendants---Proof---Reasonable and probable cause for initiation of criminal proceedings against plaintiff---Scope--Trawler - owned by plaintiff was found fishing in prohibited zone ---No Objection Certificate issued to the plaintiff for fishing in that area had expired---Criminal case under S.9 of Exclusive Fisheries Zone (Regularization of Fishing) Act, 1975, was registered against the plaintiff--High Court quashed those criminal proceedings and appeal against the order of High Court was dismissed by Supreme Court---Effect--Reasonable and probable cause was present for initiation of the report against the plaintiff--Prosecution was terminated by quashment and no evidence had been led, by the plaintiff to establish the absence of reasonable and probable cause on the part of the defendants---Where the trawler was fishing in prohibited area with expired N.O.C., the same was sufficient for a prudent man to conclude that the persons responsible for illegal fishing were guilty---Plaintiff failed to establish malice against the defendants and further failed to prove that there was no reasonable or probable cause for his prosecution- --Suit was dismissed in circumstances:
(i) Malicious prosecution---
----Damages---Proof---Mere claiming of damages on account of loss/damages to his person, properties cannot be granted in absence of any evidence led in that regard.
Moin Azhar for Plaintiff.
Umar Hayat for Respondents.
Date of hearing: 14th September, 1999,
P L D 2000 Karachi 224
Before Rana Baghwan Das and Mushir Alam, JJ
ABDUL HAQ and others---Petitioners
versus
PROVINCE OF SINDH and others---Respondents
Constitutional Petitions Nos. D-879 and D-880 of 1994, decided on 20th January, 2000.
(a) Constitution of Pakistan (1973)--
----Art.199---Constitutional jurisdiction---Scope---Contractual matter-- Constitutional petition would not lie to enforce contract simpliciter, but observance of statutory Rules and Regulations by public functionaries, governing such contract could be enforced through writ of mandamus... Petitioners, in order to seek enforcement and due observance of statutory rules and obligations on the part of public/executive functionaries, must demonstrate that there existed in their favour clear and undisputed right or interest which needed to be recognized and respected---Only in such a situation petitioners could seek enforcement of corresponding obligations and duties on the part of public/executive functionaries through appropriate writ.
Maniar Industries (Pvt.) v. S.I.T.E Ltd. 1992 CLC 2329; Messrs Pacific Multinational (Pvt.) Ltd. v. I.-G. Police and 2 others PLD 1992 Kar. 283; Muhammad Mushtaq v. Muhammad Fiaz Abbasi and 4 others 1993 CLC 432; 1998 CLC 833 and PLD 1999 Kar.472 ref.
(b) Constitution of Pakistan (1973)--
----Arts. 129, 137 & 139---Executive Authority of Province---Role of Chief Minister---Scope---Executive Authority of Province vests in the Provincial Governor under Art. 129 of the Constitution---Such authority is to be exercised' by him directly or through other functionaries under the Constitution---Chief Minister and other Ministers of his cabinet can exercise Executive Authority as delegatee of the Provincial Governor by virtue of Rules of Business framed under Art. 139(2) of the Constitution---Exercise of Executive Authority is not unfettered, unbridled or uncontrolled but under Art.137 of the Constitution, the same is circumscribed, conferred and regulated by the Constitution or legislative instruments framed thereunder.
(c) Constitution of Pakistan (1973)--
----Art.199---Constitutional jurisdiction---Scope---Contractual matter-- Constitutional petition would not lie to enforce contract simpliciter, but observance of statutory Rules and Regulations by public functionaries, governing such contract could be enforced through writ of mandamus... Petitioners, in order to seek enforcement and due observance of statutory rules and obligations on the part of public/executive functionaries, must demonstrate that there existed in their favour clear and undisputed right or interest which needed to be recognized and respected---Only in such a situation petitioners could seek enforcement of corresponding obligations and duties on the part of public/executive functionaries through appropriate writ ----Art. 199---Judicial superintendence ---Failure or disobedience in due observance and performance of unviolable obligation---Effect---All the functionaries in a Constitutional set-up derive power and authority from the Constitution itself or from the law as may be framed by Legislature--Obedience to the Constitution and law is inviolable obligation of every citizen; higher the authority more the responsibility for such obedience and observance---Constitutional functionaries like Chief Minister take oath and swear allegiance to discharge their respective duties and to perform functions honestly to the best of their ability, faithfully in accordance with the Constitution and the law, in the interest, well-being and prosperity of the country-Any failure or disobedience in the due observance and performance of such Inviolable obligation may attract judicial Superintendence, enforcement and correction by way of appropriate writ in Courts of law, (d) Constitution of Pakistan (1973)--
---Art. 139---Rules of Business---Scope-.--Rules of Business cannot be equated with statute law---Same are subordinate legislation tending to facilitate expeditious disposal of Government business to meet the convenience and requirement of public in a democratic and Constitutional set-up---Rules of Business do not enlarge or enhance jurisdiction and scope of authority of executive/public functionaries but merely regulate the exercise of already existing authority and jurisdiction as are conferred by the Constitution and statute law enacted thereunder.
(e) Constitution of Pakistan (1973)---
----Art. 137---Exercise of Executive Authority---Where appropriate Legislation is available, its provisions are to be followed by the Executive Authority in the matter of sale, mortgage or disposal of property vested in Government.
Calicon (Pvt.) Ltd. v. Federal Government of Pakistan and others 1996 MLD 705 ref.
(f) Constitution of Pakistan (1973)---
----Art. 137---Land Lease Order, 1978 [M.L.O. No.60, Zone 'C']--.-Forest Land Lease Order, 1978 [M.L.O. No.69, Zone 'C']---West Pakistan Delegation of Powers under. the Financial Rules and the Powers of Re-appropriation Rules, 1962, Sr. No.7---Lease of forest---Renewal/extension of---Jurisdiction of Chief Minister---Scope---Chief Minister had no authority whatsoever, either to renew or extend lease in relaxation of rules, bypassing, ignoring the Constitution and law regulating such lease---Such renewal/extension of lease was not only flagrant breach of his "unviolable obligation" to respect the Constitution but also in this regard of the oath of office which he had taken and the same could not be approved by the Courts of law.
The State v. Abdullah Shah 1988 MLD 216 and Zahur Illahi v. Zulfiqar Ali Bhutto PLD 1975 SC 383 ref.
(g) Natural justice, principles of---
----Applicability---Principles of natural justice are always invoked where any right or interest of a person, is infringed or violated without show cause--One must show categorically that right or interest exists and the same has been conferred or acquired validly and legally in order to seek protection behind the principles of natural justice---Such principle is very well accepted and recognised principle of equity, and the same is so deeply embedded in legal system of Pakistan, that it is respected. and enforced by Courts of taw even where it is not specifically conferred by the statute-::Where a person is privy to malpractice, violation of Constitutional provisions and statute -law, such person cannot seek shelter behind the principles of natural justice.-
Khurrum Ali v. Pakistan Railways 1993 CLC 2344 and Mian Ghulam Muhammad v. The Collector, Montgomry and 2 others PLD 1973 Lah. 528 distinguished.
(h) Equity---
---Principle of---One who claims equity must do equity.
(i) Constitution of Pakistan (1973)---
----Art. 137---Executive Authority of Province---Extent---Maxim "ab initio non valet intractu temporis non condalescit"----Meaning which is originally void does not by lapse of time become valid---Applicability---Where extension/renewal of lease is in breach of the Constitution apart from statutory rules and regulations, the same will not give it any solemnity or lend validity simply because renewal/extension had been granted by the highest Authority of the Province---Principle of "ab initio non valet intractu temporis non condalescit" is applicable in circumstances.
(j) Locus penitentise, principle of---
----Applicability---Scope---Principle of locus poenitentiae is a principle of equity---Once it is established that a decisive step has been validly taken by the public/executive functionary, such steps are unretractable and a right crystallizes in favour of that person---Where it `is shown that such person has connived in prompting the decisive step then the principle of locus poenitentiae may have no application.
Pakistan v. Muhammad Ainayatullah Farukhi PLD 1969. SC 407 and Munir Ahmed v. University of Balochistan 15LD 1979 Quetta 131 distinguished.
1999 CLC 798 and Zahoor Ahmed v Manek Ali NLR 1994 CLJ 227 ref, (k) Maxim---
------ Fraus et dolus nemini patracinari debent" -Meaning---Fraud and deceit ought not to benefit anyone.
(l) Constitution of Pakistan (1973)---
----Art. 199---Constitutional jurisdiction of High Court---Scope---Endorsing of executive act---High Court in its Constitutional jurisdiction does not extend the protection of law to a delinquent person to retain a gain, privilege or benefit which has been acquired by manipulation and in flagrant violation of mandate of law---Where an executive act, even of the highest Executive Authority of Province, is established to be in excess of authority and in breach of Constitutional provisions and law, such executive act is not endorsed by High Court.
1989 SCMR 441; 1995 PLC (C. S.) ,119; PLD 1995 SC 331; PLD 1974 SC 106 and 1989 MLD 1046 ref.
(m) Constitution of Pakistan (1973)---
----Arts. 199 & 137---West Pakistan Delegation of Powers under the Financial Rules and the Powers of Re appropriation Rules, 1962, Sr.No.7--Land Lease Order, 1978 [M.L.O. No.60, Zone 'C']---Forest Land Lease Order, 1978 [M.L.O. No.69, Zone 'C']---Constitutional petition---Extension of lease of forest, in violation of law and by relaxing relevant Rules and Regulations---Period of lease initially was for five years, and on the direction of the Chief Executive of the Province the Authority had extended the lease for a period. of 30 years---Petitioners failed to deposit lease amount due for holding over, after the initial period of five years---New incumbent in the office of the Authority revoked the extension of the lease---Validity---New incumbent by doing so, had in fact retracted the wrong steps in order to retrieve and restore the public property to be dealt with strictly in accordance with law---Such action, even if in deviation of certain norms and procedure could not be said to be altogether illegal and unjust as it was a step in right direction that had set right a wrong---Constitutional petition was dismissed accordingly.
Dr. Moula Bux Jamali v. P.E.C.H Society Ltd. 1993 CLC 740; Muhammad Umer v. Government of Sindh and others PLD 1995 Kar. 57; Messrs Ishrat .(Pvt.) Ltd. v. Moulana Muhammad Din and 3 others 1995 SCMR 1235 and Zahid Akhtar v. Government of Punjab PLD 1995 SC 530 ref.
Abdul Fattah Malik for Petitioners.
Zawar Hussain Jaffri, Addl. A.G. for Respondents.
Date of hearing: 2nd September, 1999.
P L D 2000 Karachi 238
Before Rasheed Ahmed Razvi, J
HABIBULLAH---Appellant
versus
ZAKIR ALI and another---Respondents
First Rent Appeal No.48 of 1998, heard on 12th May, 1999
(a) Sindh Rented Premises Ordinance (XVU of 1979)---
----S. 21---Appeal before High Court ---Maintainability---Pre-conditions--Conditions for maintaining an appeal before High Court are that party filing appeal must be "aggrieved person" and the order against which appeal has been preferred must not be an "interim order".
(b) Sindh Rented Premises Ordinance (XVII of 1979)---
----S. 21---Expression "aggrieved person"---Connotation---Aggrieved person does not mean only a party to proceedings but any person aggrieved by the order, claiming that the order complained against is prejudicial to him and affects his interest adversely.
Mst. Amena Bano and 4 others v, Muhammad Rahim and another 1997 CLC 29; Muhammad Azeem Qureshi v. Hakim Syed Akhtar Irshad and 4 others 1990 CLC 122; H.M. Saya & Co. v. Wazir Ali Industries Ltd,. PLD 1969 SC 65 and Ghulam Haider v. Muhammad Haneef and others PLD 1979 Kar. 167 ref.
(c) Sindh Rented Premises Ordinance (XVII of 1979)---
-S. 21(1)---Appeal to High Court---Scope -All such orders which are not interim in nature have been made appealable under S.21(1) of Sindh Rented Premises Ordinance, 1979.
(d) Words and phrases--
......Interlocutory order"---Meaning---Interlocutory order is an order which is neither incidental nor collateral and which embraces the whole gamut of dispute.
Mian Manzar Bashir and others v. M.A. Asghar & Co. PLD 1978 SC 185; Muhammad Umer and another v. Dr. Amina Ashraf PLD 1977 Kar. 305 and Ibrahim v. Muhammad Hussain PLD 1975 SC 457 ref.
(e) Sindh Rented Premises Ordinance (XVII of 1979)---
----S.21---Appeal to High . Court---Maintainability---Order dismissing application seeking striking off defence of opponent tenant by Rent Controller, is appealable.
A.M. Qureshi v. The Secretary, Government of Sindh, Education Department and another 1986 CLC 1587; Zubaida Begum v. Mrs. S.T. Naqvi 1986 SCMR 261; Hayat Ali v. Mst. Aziza Mehmood 1980 SCMR 298; Mst. Anwar Fatima and 5 others v. Muhammad Ali Mutlaq PLD 19,86 Kar. 252; Mrs. Khairun Nisa- and another v. Mrs. Mehrurn Nisa 1990 CLC 661 and Eastern Express Company Ltd. v. Messrs Haji Khushi Muhammad 1995 MLD 470 ref.
(f) Sindh Rented Premises Ordinance (XVII of 1979)---
----S. 21---Civil Procedure Code (V of 1908), 0.1, R.10---Appeal to High Court---Maintainability---Dismissal of application filed under 0.1, R.10, C.P.C.---Failure to file appeal against dismissal of such application--Effect---Order of dismissal of application under O. I, R.10,. C. P. C. was riot interim in nature---Order of Rent Controller which decided a controversy between the parties being not an interim order, was appealable.
Muhammad Mubin Siddiqui v. Mst. Shahzadi Begum and 2 others 1982 SCMR 233 rel.
Capt. Rahat Majeed v. Mst. Kubra Bai 1982 CLC 1171; Gurdasmal v. Pahlaj Ram and another 1986 CLC 43; Habib Alavi Athar v. Hasan and 7 others 1986 MLD 1656; Sarfaraz Ali v. Shahjehan Begum and another 1996 CLC 1034; Muhammad Ishaq v. Syed Muhammad Zubair 1996 MLD 797 and Allah Ditta and another v. Muhammad Hussain and others PLD 1965 Lah. 29 ref.
(g) Words and phrases---
----"Aggrieved person "---Connotation.
Zahid Marghoob for Appellant.
S.M. Haider for Respondent No. 1.
Respondent No.2 (absent).
P L D 2000 Karachi 245
Before Hamid Ali Mirza and Ghulam Rabbani, J
AMIR MALIK and another---Petitioners
versus
GOVERNMENT OF SINDH and 4 others---Respondents
Constitutional Petition No. 199 of 1998, decided on 15th- March, 2000, Criminal Procedure Code (V of 1898)---
----Ss. 133, 134 & 137---Constitution of Pakistan (1973), Art.199--Constitutional petition---Conditional order of removal of nuisance--Conditional order was passed by Magistrate against petitioner to remove alleged nuisance---Validity---Magistrate, on filing objection against such order was required under S.137, Cr.P.C. to hold an.-enquiry by way of recording evidence, but he passed the final order without conducting the enquiry---Order passed by Magistrate under S.133, Cr.P.C. could be made absolute only after taking evidence in the matter as provided tinder S.137, Cr.P.C.---No evidence having been recorded by Magistrate before passing final order, impugned order was set aside by High Court and case was remanded to decide afresh after strictly adhering to the relevant law.
M.M.Aqil Awan for Petitioners.
Munir-ur-Rehman, Addl. A.-G. for Respondent No.1
K.B. Bhutto for Respondent No. l
P L D 2000 Karachi 246
Before S. Ahmed Sarwana, J
ASKARI COMMERCIAL BANK LIMITED and others---Plaintiffs
versus
PAKLAND CEMENT and others---Defendants
Suits Nos. 865 to 868 of 1999, decided on 28th February, 2000.
(a) Islamic Jurisprudence--
----Financing in Islam- "Musharakah"---Meaning and scope---Term "Musharakah" is a relationship established between the parties to undertake some specific business venture or to undertake business generally as partners through a mutual contract wherein the proportion of profit to be distributed between the partners must be agreed upon at the time of effecting the contract which must conform to ratio of capital invested by them and in which each partner agrees to bear the loss exactly according to ratio of his investment.
Introduction to Islamic Finance by Moulana Taqi IJsmani, published by Idaratul Ma'arif, Karachi; Practice and Laws of Banking in Pakistan by Asrar H. Siddiqui, published by Royal Book Company, Karachi, 1998 Edn.; Compendium of Legal Opinions on the Operations of Islamic Banks, edited and translated by Yusuf Talab De Lorenzo, published by Institute of Islamic Banking and Insurance, London, 1997 Edn. and Outlines of Islamic Jurisprudence by Imran Ahsan Khan Nyazee, published by Advanced Legal Studies Institute, Islamabad ref.
(b) Islamic Jurisprudence--
----Financing in Islam---" Murabahah"---Meaning---Murabahah is sale on deferred payment basis which is also termed as agreement for sale on credit.
(c) Banking Companies (Recovery of Loan, Advances, Credits and Finances) Act (XV of 1997)--
---S. 15(2)---Bank loan---Re-scheduling of payments---Jurisdiction of Banking Court---Scope---Banking Court was not competent to re-schedule payments except to a limited extent, if conditions specified in S.15(2) of Banking Companies (Recovery of Loans, Advances, Credits and Finances) Act, 1997 were fulfilled.
(d) Banking Companies (Recovery of Loans, Advances, Credits and Finances) Act (XV of 1997)--
----S. 9---Qanun-e-Shahadat (X of 1984), Art.84---Suit for recovery of Bank loan--Comparison by Court of the signatures-bf guarantor with those present on Vakalatnama and the affidavit filed by the guarantor---Validity---Banking Court refused to compare the signatures with such documents---Validity--Person could change his signatures if he wanted and that a signature varied with passage of time---Where the guarantor denied execution of guarantee, the Court compared his signatures with those present on Form IX which was filed with Registrar of Joint Stock Companies---Plea of the guarantor to compare his signatures with Vakalatnama and the affidavit filed with written reply was not bona fide and the same was rejected in circumstances.
(e) Banking Companies (Recovery of Loans, Advances, Credits and Finances) Act (XV of 1997)--
----S. 17(2)---Qanun-e-Shahadat (10 of 1984), Art.17---Attestation of Banking agreements---Requirement of two witnesses---Applicability---Where the agreement was executed prior to coming into force of Banking Companies (Recovery of Loans, Advances, Credits and Finances) Act, 1997, requirement of two witnesses would not be applicable to such agreement.
(f) Banking Companies (Recovery of Loans, Advances, Credits and Finances) Act (XV of 1997)--
----S. 9---Contract Act (IX of 1872), S.74---State Bank of Pakistan BCD Circular No.32 dated 26-11-1984---Principles of Marabaliah --- Recovery of prompt payment bonus---Scope---Such bonus, prima facie, is in the nature of penalty for late payment and the same is neither permissible under S.74 of Contract Act; 1872 nor under Islamic principles of finance for Murabahah which do not allow recovery of any penalty in case of delay in payment--Payment of any penalty on delayed payment of instalments amounts to markup on mark-up which is prohibited by State Bank of Pakistan BCD Circular No.32 dated 26-11-1984---Prompt payment bonus under any nomenclature or form cannot be permitted to be incorporated in, or if incorporated, cannot be enforced in view of agreement based upon the Principles of Islamic Finances and under BCD Circular No.32.
(g) Islamic Jurisprudence--
----Finances in Islam ---Morabahah---Payment of penalty in case of delay in payment of agreed purchase price is prohibited in Islamic system of finance, in relation to Marabahah.
(h) Words and phrases--
"Musharakah"---Meaning.
(i) Words and phrases--
_"Murabahah"---Meaning.
Sajid Zahid for Plaintiffs.
Munawar Hussain for Defendants Nos. 1, 2 and 4 to 6.
Ashraf H. Rizvi for Defendant No.3.
P L D 2000 Karachi 258
Before S. Ahmed Sarwana, J
JEHANZEB AZIZ DAR---Plaintiff
versus
Messrs MAERSK LINE and others---Defendants
Admiralty Suit No.391 of 1994, decided on 24th March, 2000
(a) Admiralty Jurisdiction of High Courts Ordinance (XLII of 1980)---
----S. 7---Sindh Chief Court Rules (O.S.), Rr. 7 & 774---Civil Procedure Code (V of 1908), Preamble---Suit filed in Admiralty Jurisdiction of High Court--Applicability of. Civil Procedure Code, 1908---Scope---Rules of Civil Procedure Code, 1908 are applicable to proceedings filed in Admiralty Jurisdiction of High Court as long as the Rules mentioned in C.P.C. are not in conflict with or contrary to Sindh Chief Court Rules (O.S.).
(b) Admiralty Jurisdiction of High Courts Ordinance (XLII of 1980)---
----S. 7---Sindh Chief Court Rules (O.S.), R.774---Admiralty suit---More than one remedies, provided to a party to such suit---Validity--Where a party had two remedies available to him one under the provisions of Sindh Chief Court Rules (O.S.) or under Civil Procedure Code, 1908, and other under S.7 of Admiralty Jurisdiction of High Courts Ordinance, 1980, which provided for an appeal against order passed by Single Judge of High Court, such party might either file appeal before Division Bench of the High Court against the order or file application before the same Judge/Court under the provisions of Sindh Chief Court Rules (O.S.) or Civil Procedure Code, 1908.
(c) Practice and procedure---
----More, than one remedies available to a party---Scope---Where two remedies are available, a party may adopt either of the two---"Remedy which is faster and does not involve too much time and interference with already overloaded work of High Court, should be preferred in such a situation.
(d) Admiralty Jurisdiction of High Courts, Ordinance (XLII of 1980)---
----S. 7---Civil Procedure Code (V of 1908), O.IX, R.9---Admiralty suit--Dismissal for non-prosecution---Setting aside of such order---Single Judge of High Court rejected request of the plaintiff for adjournment and suit was dismissed for non-prosecution---Application under OAX, R.9, C.P.C. was filed for restoration of the suit---Contention raised by defendant was that such application was not maintainable and appeal under S.7 of Admiralty Jurisdiction of High Courts Ordinance, 1980 was to be filed ---Validity--Both the remedies being available to the plaintiff, there was no legal defect in application under O.IX, R.9, C.P.C. and the same was competent and maintainable in law---Factual grounds for setting aside the order had not been challenged by the defendants, who opposed the restoration of the suit on legal grounds only which were prima facie vexatious to the knowledge of the defendants---Application was allowed with costs in circumstances.
Dada Steel Mills (Pvt.) Ltd. v. m.v. Ivan and others 1997 MLD 866; Twaha v. The Master m.v. Asian Queen PLD 1982 Kar. 749; Sphinx Shipping Agency v. m.v. Justice and others PLD 1997 Kar. 216; Muhammad Hanif v. District Judge/Election Tribunal 1983 CLC 2965 and Muhammad Aslam Mirza v. Mst. Khurshid Begum PLD 1972 Lah. 603 ref.
(e) Admiralty Jurisdiction of High Courts Ordinance (XLII of 1980)---
----S. 3---Sindh Chief Court Rules (O.S.), R.774---Civil Procedure Code (V of 1908), Preamble---Admiralty suit---Procedure for conducting trial---No procedure for conducting such trial was provided in Sindh Chief Court Rules (O.S.)---Effect---Trial Court, in absence of such procedure, would be justified in applying the principles of C.P.C. or following the provisions of C.P.C. to conduct the proceedings as long the same were reasonable and not contrary to principles of equity and natural justice.
(f) Admiralty Jurisdiction of High Courts Ordinance (XLII of 1980)---
----S. 7(1)---Expression "order" ---Meaning and scope---Word "order" means an order given by Judge on merits and does not include an order passed by a Court dismissing suit without discussing evidence on record or an order dismissing suit for non-prosecution.
Ghulam Hussain Shah v. Ghulam Muhammad PLD 1974 SC 344; Bakhtawar v. Amin and others 1980 SCMR 89 and Syed Muhammad Raza Shah v. Syeda Salima Jillani PLD 1976 Lah. 1015 ref.
(g) Civil Procedure Code (V of 1908)---
----Ss. 114 & 153---Order or judgment, correction of---Provisions of Ss. 114 & 153, C.P.C.---Distinction---Where there was a typographical mistake, the remedy lies in S.153, C.P.C. but where an issue has been decided by a Court inadvertently overlooking a judgment of Supreme Court, such order can be corrected by filing an application for review under S.114, C.P.C.
(h) General Clauses Act (X of 1897)---
----S. 21---Admiralty suit---Locus poenitentiae, principle of ---Applicability-Suit dismissed for non-prosecution---Restoration of the suit by same Court--Validity---Under the provisions of S.21 of General Clauses Act, 1897, and the light of decisions of superior Courts, the Court had the power to vary amend, withdraw or rescind that order---Application to set aside order of dismissal of suit for non-prosecution was rightly filed in the same Court which had the power to withdraw or rescind such order.
Bashir Khan v. District Magistrate PLD 1957 Lah. 892; Firdous Spinning & Weaving Mills Ltd. and others v. Federation of Pakistan and 2 others PLD 1984 Kar. 522 ref.
(i) Admiralty Jurisdiction of High Courts Ordinance (XLII of 1980)---
----S. 7---Appeal against interlocutory order---Scope---Appeal against interlocutory order would cause unnecessary delay and the proceedings would not be expedited in such circumstances.
Muhammad Ali Jan for Plaintiff.
Agha Faquir Muhammad for Defendants.
P L D 2000 Karachi 269
Before Mushtaq Ahmed Memon, J
CENTURY LINK DEVELOPMENT CORPORATION (PVT.) LTD---Petitioner
versus
HABIB BANK LTD. and others---Respondents
Civil Miscellaneous Application No.2424 of .1999 in Suit No.380 of 1999, decided on 27th August, 1999.
(a) Contract---
----Performance guarantees"---Connotation---Legal status of such guarantee---Performance guarantees are independent contract and Bank Authorities must construe same independent of primary contract.
National Construction Limited v. Aiwan-e-Iqbal Authority PLD 1994 SC 311 and Messrs Zeenat Brother (Pvt.) Limited v. Aiwan-e-Iqbal Authority and others PLD 1996 Kar. 183 ref.
(b) Civil Procedure Code (V of 1908)---
----0. XXXIX, Rr. 1 & 2---Interim injunction---Conditions precedent for grant of injunction---Scope---For the purpose of grant of interim injunction, it is imminent that besides prima facie case, exposure to irreparable injury must be shown, additionally a plaintiff is obliged to establish balance of convenience in favour of grant of injunction and for the purpose of interlocutory matters, affidavits alone, have to be considered.
(c) Affidavit---
---- Incorporating contents of documents and pleadings by reference, in affidavits filed in support of interlocutory applications disapproved.
(d) Civil Procedure Code (V of 1908)--
----O.XXXIX, Rr. 1 & 2---Interim injunction, grant of---Restraining the defendant from encashing Bank guarantee---Contention raised by the plaintiff was that due to unavoidable circumstances loan was not repaid in time to the defendant, -who was going to encash Bank guarantees executed in its favour---Validity---Plaintiff could always negotiate fresh terms with the guarantor or any other financing institution as were proposed to be negotiated with the defendant, who was not willing to negotiate any fresh term for extension of the facility granted to the plaintiff---Plaintiff had not even asserted in affidavit and pleadings that refusal of prayer of interim injunction would expose it to irreparable loss or that balance of convenience was in favour of grant of injunction---Plaintiff was neither entitled to grant of injunction on 'equitable ground nor on the ground of irreparable loss Application was dismissed accordingly.
National Construction Limited v. Aiwan-e-Iqbal Authority PLD 1994 SC 311; M/s. Zeenat Brother (Pvt.) Limited v. Aiwan-e-Iqbal Authority and others PLD 1996 Kar. 183; Shahzada Muhammad Umer Beg v. Sultan Mahmood Khan and another PLD 1970 SC 139; Marghoob Siddiqui v. Hamid Ahmed Khan and others 1974 SCMR 519; Messrs Rafidian Bank, Iraq v. M.L. International (Pvt.) Limited Karachi 1993 MLD 1234; Pakistan Engineering Consultants v. Pakistan International Airlines Corporation and BCCT and others 1993 CLC 882 and Haral Textile .Limited v. Banque Indosuez Belgium S.A. and others 1999 $CMR 591 ref.
Shahanshah Hussain for Petitioner
Azizur Rehman for Respondent No. 1.
Muhammad Shahid for Respondent No.2.
P L D 2000 Karachi 280
Before Wahid Bux Brohi, J
JETANDAR KUMAR and 2 others---Applicants
versus
Mst. BIBI MEENA alias AMEERZADI through Legal Heirs---Respondent
Civil Revision No.88 of 1999, decided on 17th February, 2000
(a) Civil Procedure Code (V of 1908)--
----S. 115---Revisional jurisdiction, exercise of---Scope---Provision of S.115, C.P.C. applies only to cases involving illegal assumption, non exercise or irregular exercise of jurisdiction but same cannot be invoked against conclusion of law or fact which does not, in any way, affect jurisdiction of the Court, no matter, however erroneous, wrong or perverse, the decision may be, either on a question of fact or law, unless the decision involves a matter of jurisdiction.
Aziz-ur-Rehman v. Government of N.-W.F.P. PLD 1996 Pesh. 51 ref, (b) Civil Procedure Code (V of 1908)--
---0-. XXII, Rr. 1 & 2---Right to sue---Survival of---Entering names of surviving plaintiffs---Scope---Where right -to sue survives to legal heir after plaintiff's death under the provision of OXXII, R.1, C.P.C., the suit will not abate and under O.XXII, R.2, C.P.C., the names of the surviving plaintiffs will be entered in plaint.
(c) Civil Procedure Code (V of 1908)--
-0. XXII, Rr & -Impleading legal heirs of deceased plaintiff as party to suit---Trial Court allowed the respondent to be impleaded in place of deceased plaintiff---Validity---No illegality had been committed by Trial Court in allowing the suit to proceed through the plaintiff's sole legal representative to whom right to sue survived---No illegal exercise of jurisdiction by the Court was found in circumstances.
Zulfiqar Ali v. Lal Din and another 1974 SCMR 162 and Shah Wali v. Allah Bakhsh 1999 CLC 45; Aziz-ur-Rehman v. Government of N.-W.F.P. PLD 1996 Pesh. 51; Taj Muhammad v. Mst. Zaitooney 1996 MLD 1270 and Raja Abdul Hamid Khan v. Muhammad Naseem 1980 CLC 1105 ref.
Vijay Kumar for Applicants.
Ejaz Ali Hakro for Respondent No. 1.
Mian Khan Malik, Addl. A.-G. for Respondent No.2
P L D 2000 Karachi 283
Before Dr. Ghous Muhammad and Abdul Ghani Sheikh, JJ
MUHAMMAD NISAR DOSSA and 5 others---Appellants
versus
MUHAMAMD HUSSAIN DOSSA and 16 others---Respondents
High Court Appeal No. 150 of 1997, decided on 28th April, 1999.
(a) Words and phrases--
------Held"---Meaning.
Legal Thesaurus and Black's Law Dictionery, 6th Edn., p.731 ref.
(b) Companies Ordinance (XLVII of 1984)---
----Ss. 10 & 178---Election of Directors of Company---Reducing number of Directors by Official Assignee---Commissioner was appointed by order of High Court for taking over the business of the company and to call annual general meeting for election of Directors of the Company---Contention by the appellants was that the Official Assignee had reduced the number of the Directors---Validity---Appellants themselves created such a situation when one of the appellants tried to preside over the annual general meeting in violation of order of High Court and thereafter all of the appellants bycotted the election---Official assignee did not change the number of Directors already fixed by him for the purpose of election---Directors so elected in the election were seven and could not be said to be in .violation of S.178(1) of Companies Ordinance, 1984---Number of Directors was not reduced by Official Assignee and election was validly held according to the order of High Court.
Naveed Textile Mill's case PLD 1997 Kar. 432 and Iqbal Alam and others v. Plastic Raftar Pvt. Ltd. 1991 CLC 589 ref.
Sher Afgan for Appellants.
Shahanshah Hussain for Respondents Nos. 1 to 6.
S. Zubair Shah for Respondents Nos. 7 to 17.
Date of hearing: 28th April, 1999.
P L D 2000 Karachi 288
Before Rasheed Ahmed Razvi, J
Mrs. RAZIA AHMED and another---Plaintiffs
versus
KARACHI BUILDING CONTROL AUTHORITY through Chief Controller of Buildings, Karachi and 2 others---Defendants
Civil Suit No. 1563 of 1998, decided on 10th September, 1999.
(a) Civil Procedure Code (V of 1908)---
---0. II, R.2 & O.XXIII, R.1---Filing of subsequent suit, during pendency of earlier suit, without seeking leave of the Court--Validity---Where subsequent suit has been filed during pendency of earlier suit and the ' earlier suit has been withdrawn without permission of the Court to institute a fresh suit, subsequent suit is not affected by the provisions of either 0.11, R.2 or O.XXIII, R.1, C.P.C.
Haji Ashfaq Ahmad Khan and others v. Custodian of Evacuee Property, Pakistan and others PLD 1966 (W.P.) Kar. 597; The Commissioner of Income-tax, N.C.A. Circle, Karachi and another v. Haji Ashfaq Ahmad Khan and 10 others PLD 1973 SC 406; Irshad Ali v. Islamic Republic of Pakistan and 2 others 1981 CLC 111; Ghulam Nabi and others v. Seth Muhammad Yaqub and others PLD 1983 SC 344; Ram Lal v. Upendra Datt AIR 1928 Lah. 710; Mungi Lal v. Radha Mohan AIR 1930 Lah. 599 and Abdullah v. Bashiran Bibi PLD 1981 Lah. 336 ref.
Akhtar. Hussain v. S.M. Hanif and 2 others 1990 MLD 1652 distinguished.
(b) Civil Procedure Code (V of 1908)---
----O.XXVI, R.10---Report of Local Commissioner---Admissibility---Where none of the parties. had raised objection to the report of Local Commissioner, the same was accepted accordingly.
(c) Sindh Buildings Control Ordinance (V of 1979)---
----S. 6(i)---Raising of construction---Approval of building plan. requirement of---Scope---No person can raise construction under provision of S.6(i) of Sindh Buildings Control Ordinance, without first getting building plan approved from Building Control Authority.
Mst. Hawa Bai v. Haji Ahmad and another 1987 CLC 558 and Irfan Zamir Butt v. Karachi Metropolitan Corporation and another 1998 CLC 958 ref.
(d) Sindh Buildings Control Ordinance (V of 1979)---
----S. 6---"Construction" or "reconstruction" as used in S.6 of Sindh Buildings Control Ordinance, 1979---Connotation---Term "construction" or "reconstruction" includes all such activities which may change the nature and pattern of a building---Term includes work of major repairs either to be carried out in the existing structure or after demolition of old construction.
(e) Sindh Buildings Control Ordinance (V of 1979)---
----S. 6---Civil Procedure Code (V of 1908), O.XXXIX, Rr.l, 2 & 4--Interim injunction, grant of---Plaintiff's construction was stopped by defendant-Authority for the reason that instead of making repairs, the plaintiff had raised new construction without any approved plan---Earlier, a suit was filed in Civil Court and during pendency of that suit, the present suit was filed without disclosing the fact of earlier suit---Effect---Where the subsequent suit was filed by wife of the plaintiff of the earlier suit, the plaintiff approached High Court with unclean hands---Plaintiff, in absence of approved plan, failed to make out a prima facie case for grant of interim injunction---Application for interim injunction was dismissed and ad interim injunction was vacated accordingly.
(f) Words and phrases-
.Construction" or "reconstruction"---Connotation.
Mirza Adil Mustafa Baig for Plaintiffs.
Muhammad Iqbal Memon for Defendant No. 1.
Muhammad Ziauddin Qureshi for Defendant No.2.
Nemo for Defendant No.3
P L D 2000 Karachi 296
Before Muhammad Roshan Essani and S.A. Rabbani, JJ
Messrs POINEER CABLES LIMITED, KARACHI---Petitioner
versus
THE FEDERATION OF PAKISTAN through Secretary, Ministry of Finance, Government of Pakistan, Islamabad and 2 others---Respondents
Constitutional Petition No. 127 of 1997, decided on 13th May, 1999.
Customs Act (VI of 1969)---
----S. 18(2)---S.R.O: 1050(1)/95, dated 29-10-1995---Constitution of Pakistan (1973), Art.199---Constitutional petition---Regulatory duty--Import of raw material for manufacturing of cables and conductors--Contention by petitioner was that 65 per cent. statutory duty was already being paid on such raw material, therefore, it was exempted from regulatory duty---Validity---Where the goods imported was subject to duty chargeable at the rate of 65 per cent., the same would be exempted from the regulatory duty by virtue of cl. (ii)(b) of S.R.0.1050(1)/95, dated 29-10-1995---Case was remanded for examination and action accordingly.
1999 SCMR 412 ref.
Sirajul Haque for Petitioner.
Nemo for Respondents.
Date of hearing: 11th May, 1999.
P L D 2000 Karachi 298
Before Rasheed Ahmed Razvi, J
Messrs DYNASEL (PVT.) LTD. ---Appellant
versus
THE REGISTRAR OF TRADE MARKS, GOVERNMENT OF PAKISTAN, TRADE MARKS, KARACHI---Respondent
Civil Miscellaneous Appeal No.18 of 1995, decided on 24th September 1999.
(a) Trade Marks Act (V of 1940)--
----Ss. 6, 8, 10 & 15---Registration of trade mark---Procedure---Registrar of Trade Marks was competent to refuse application for registration or to accept the same absolutely or subject to amendment, modification or limitations--Registrar, in case of refusal or conditional acceptance was required to state in writing the grounds of his decision---Once an application for registration of trade mark had been accepted either absolutely or subject to conditions or limitations, same should be advertised in prescribed manner---Provisions of S.15(1) of Trade Marks Act, 1940 had authorised. Registrar to advertise an application before its acceptance if a trade mark applied for falls within ambit of S.6(1)(e) of the Act ---Registrar, in exceptional circumstances, was also competent to advertise application for registration of trade, if in his opinion it was so expedient---Registrar was also authorised to re-advertise said trade mark after application had been accepted, but that was discretionary with him as the incorporated phrase "but shall not be bound so to do" indicated.
Assistant Registrar of Trade Marks, Karachi v. Messrs Lakson Tobacco Company Ltd. 1992 SCMR 2323; Transpak Corporation Ltd. v. The Registrar of .Trade Marks 1991 MLD 658; Messrs Surya Brothers v. Messrs Dada Soap Factory Ltd. PLD 1971 Kar. 189; David Vaughan Racklin v. Deputy Registrar of Trade Marks, Karachi 1986 MLD 1666; Tambrands Inc. v. Registrar of Trade Marks 1991 MLD 1414; Block Drug Company Inc. v. The Registrar of Trade Marks 1991 MLD 2310; Lakson Tobacco Company Limited v. Registrar of Trade Marks 1991 CLC Note 328 at p.251; Messrs Colgate-Palmolive (Pakistan) Ltd. v. Assistant Registrar of Trade Marks PLD 1992 Kar. 15; Ruston and Homby Ltd. v. Zamindara Engineering Co. AIR 1970 SC 1649 and Messrs Dada Soap Factory Ltd. v. Crescent Pak Industries Ltd. and another 1987 MLD 1256 ref.
(b) Trade Marks Act (V of 1940)--
----Ss. 6, 8, 10, 14 & 15---Registration of trade mark ---Procedure---Discretion of Registrar of Trade Marks---Provisions of Ss. 14 & 15 of Trade Marks Act, 1940 had vested the Registrar with discretion to advertise or not to advertise application for registration of trade mark before its refusal, but there must be enough material before him which must satisfy his conscience and the discretion should be exercised through speaking order.
Rawhide Trade Mark's case 1962 RPC 133; Hallelujah Trade Mark's-ca 1976 RPC 605; PLD 1997 Central Statutes 423; Play Boy Enterprises v. Registrar of Trade Marks and another 1986 MLD 1312; Iqbal Ahmed v. The Registrar of Trade Marks, Karachi 1988 CLC 1052; National Detergents Limited v. Assistant Registrar, Trade Marks 1990 ALD 124; Bubble-up Company Inc. v. Messrs 7-Up, U.S.A. PLD 1975 Kar. 582 and Calbin Klein Cosmetics Corporation v. The Registrar 1991 MLD 2402 ref.
(c) Trade Marks Act (V of 1940)--
----Ss. 6, 8, 10, 14 & 15---Registration of trade mark ---Procedure--Discretion of Registrar Trade Marks ---Scope---When there were more than one owner of a similar or identical registered mark-and when an application was filed for registration of said trade mark, it was incumbent upon Registrar of Trade Marks to advertise application before its final or partial acceptance---In case of one owner, it was admissible for Registrar to advertise application for registration of already registered trade mark as it would enable Registrar to know whether first owner had abandoned use of his mark or there could be a situation where first owner could extend no objection for registration of same trade mark---Purpose of refusal to register a mark already registered in, same class was to save buyers at large from confusion and deception and it was also for the protection of proprietary rights of the owners of a registered trade mark---When one registered owner of a trade mark had permitted another person to get said trade mark registered second time in favour of said person, no prohibition existed in scheme of Trade Marks Act, 1940 to decline registration of said mark.
(d) Administration of justice, principle of--
---- Justice should not only be done, but it should appear to have been done.
(e) Trade Marks Act (V of 1940)--
----Ss. 6, 8, 10, 14 & 15---Registration of trade mark---Procedure---All applications pertaining to similar and identical trade mark of same class were to be dealt with jointly.
Chaudhry Tanvir Amjad for Appellant
Syed Tariq Ali,, Standing Counsel alongwith Zafar Iqbal, Assistant Registrar for Respondent.
Sultan Ahmed Shaikh: Amicus curiae
Dates of hearing: 6th May; 11th August and 2nd September, 1999
P L D 2000 Karachi 310
Before Muhammad Roshan Essani and Abdul Ghani Shaikh, JJ
ABDUL MAJEED---Petitioner
versus
GOVERNMENT OF SINDH through Secretary, Food Department, Karachi and 2 others---Respondents
Constitutional Petition No.D-436 of 1997, decided on 26th February, 2000.
(a) Contempt of Court Act (LXIV of 1976)---
----Ss. 3 & 4---Contempt proceedings ---Contemner, a Government official--Appearance through State Counsel ---Contemner had not engaged any counsel but was represented by the State Counsel---Validity---Representation by the State Counsel in contempt proceedings was not permissible under law.
(b) Contempt of Court Act (LXIV of 1976)---
----Ss. 3 & 4---Sindh Food grains (Licensing Control) Order, 1957, cl.(10)--Contempt proceedings---Cancellation of food grains licence---Plea raised by the petitioner was that the licence was cancelled in derogation of the order passed by High Court in Constitutional petition---Validity---Petitioners were found guilty of contravention of Foodgrains (Licensing Control) Order, 1957 for non-submission of the paid-up electricity bills and also for misusing Government subsidized wheat---Notices in that regard were issued to the petitioners who did not furnish the required explanation within stipulated time and also failed to appear before the Authority, though opportunity of personal hearing was afforded to them---Where the petitioners were found guilty of contravention of cl.(10) of Sindh Foodgrains (Licensing Control) Order, 1957, licences of the petitioners were rightly cancelled and contempt application against the alleged contemner who was Rationing Controller and Licensing Authority was dismissed with costs.
(c) Contempt of Court--
---- Committal for contempt of Court is a weapon which is to be used sparingly and always with reference to administration of justice where ex facie some contempt of Court has been committed.
Re. Ramsay LR 3 PC 427; Amulya Ratan v. Amulya Chandra 32 CWN 1242; K.M. Bison v. A.H. Skone 88 IC 725 and Tarit Kanti Biswas AIR 1918 Cal. 988 ref.
(d) Contempt of Court Act (LXIV of 1976)---
----Ss. 3 & 4---Contempt proceedings---Scope---No bar exists in moving the Court in order to bring a case of contempt of Court to the notice of the Court for taking action against an alleged contemner or contemners, such rights, however, cannot be misused with malicious intention to cause harassment to others.
Tarfatullah v. S.N: Maitra AIR 1952 Cal. 919 ref.
Syed Ali Ahmed Taqvi for Petitioner.
Mian Khan Malik, Additional Advocate-General, Sindh.
Respondent No.3 in person.
P L D 2000 Karachi 322
Before Sabihuddin Ahmed and Zahid Kurban Alavi, JJ
ABDUL BASIT ZAHID --- Petitioner
versus
MODARABA AL-TIJARAH through Chief Executive and 2 others---Respondents
Constitutional Petition No.D-192 and Miscellaneous No.524 of 2000, decided on 2nd May, 2000.
(a) Banking Companies (Recovery of Loans, Advances, Credits and Finances) Act (XV of 1997)--
----Ss. 3 & 18(1)---Civil Procedure Code (V of 1908), S.51 & _O.XXI, RAO ---Constitution of Pakistan (1973), Arts.199, 4 & 10--Constitutional petition---Execution of decree through arrest and detention of judgment-debtor---Requirements---Expression "in such other manner as it deems fit in S.18(1), Banking Companies (Recovery of Loans, Advances, Credits and Finances) Act, 1997 only means that apart from the modes prescribed 1n, the C.P.C. and other laws the Banking Court may adopt any other method for execution of the decree provided the same is not repugnant to or in conflict with any existing law---Judgment-debtor, therefore, would not be detained in prison without fulfilling the requirement of S.51 & O.XXI, R.40, C.P.C.---Principles.
The provisions of Banking Companies (Recovery of Loans, Advances, Credits and Finances) Act, 1997 like any other statute, have to be harmoniously construed and one cannot lose sight of the provisions of section 3 thereof which stipulates that unless expressly provided the provisions of the Act shall be in addition to and not in derogation of any day for the time being in force.
Section 51, C.P.C. provides for execution of decree through arrest and detention of a judgment-debtor and the proviso thereof furnishes certain safeguards against the deprivation of liberty and contemplates that such power can only be exercised under certain given situations. In view of the above and keeping in view the principles that statutes affecting liberty of citizens are to be strictly construed the words "in such other manner as it deems fit" cannot be so broadly interpreted as to confer unbridled powers upon the Banking Courts to commit judgment-debtor to prison without fulfilling the condition laid down in C.P.C. Words "in such other manner as it deems fit" only mean that apart from the modes prescribed in the C.P.C. and other laws, the Banking Court may adopt any other method for execution of decrees provided the same is not repugnant to or in conflict with any existing law.
The judgment-debtor will not, therefore, be detained in prison without fulfilling the requirements of section 51, C.P.C. and Order XXI, Rule 40, C.P.C.
Precision Engineering Ltd. and others v. Grays Leasing Ltd. PLD 2000 Lah. 290 ref.
(b) Banking Companies (Recovery of Loans, Advances,, Credits and Finances) Act (XV of 1997)-
----Preamble---Interpretation---Act has to be interpreted harmoniously.
Aamer Raza Naqvi for Petitioner.
Mansoorul Arfin for Respondents.
P L D 2000 Karachi 326
Before Syed Deedar Hussain Shah and Anwar Zaheer Jamali, JJ
Messrs BENGAL CORPORATION and 8 others---Appellants
versus
MIDDLE EAST BANK LTD. ---Respondent
Civil Miscellaneous Applications Nos. 993 and 998 of 1999 in 1st Appeal No.30 of 1998, decided on 8th October, 1999
Civil Procedure Code (V of 1908)---
----0. XLI, R. 19---Banking Companies (Recovery of Loans, Advances, Credits and Finances) Act (XV of 1997), S.21---Limitation Act (IX of 1908), S.5 & Art.68--Appeal dismissed for non-prosecution ---Readmission--Delay, condonation of---Panel of counsel was engaged to pursue the appeal-None of the counsel appeared on the date fixed for hearing and the appeal was dismissed for non-prosecution---Application for re-admission of appeal was to be filed within 30 days, according to Art. 68 of Limitation Act, 1908, but the same was filed after more than 30 days, without any plausible .explanation for the delay---Effect---Absence of the counsel of the appellants as well as the appellants was wilful and deliberate---Even application for condonation of delay under S.5, Limitation Act, 1908 was filed after the application under O.XLI, R,19, C.P.C.---Party was to pursue the matter carefully and diligently---Delay was not condoned and consequently the appeal was not re-admitted.
Abdul Rehman v. Pakistan PLD 1955 Sindh 248; Shirvattan Mohatta v. Muhammadi Steamship PLD 1965 SC 669; Jan Muhammad v. Abdul Ghafoor PLD 1966 SC 466; Muhammad Haleem v. H.H. Muhammad Naim and others PLD 1969 SC 275; Sardar Muhammad v. Habib Khatoon 1982 CLC 281; Qamar Sultana v. Abdul Hussain PLD 1982 Kar. 355; Muhammad Saleh v. Muhammad Shafi 1982 SCMR 33; Municipal Committee, Rawalpindi v. Muhammad Sarwar Khan 1968 SCMR 817; Goswami Krishna Murlilal Sherma v. Dhan Parkash 1983 PSC 355; Rafiq v. Munshi Lal (1981) 2 $CC 788; Lithocraft Corporation v. A. Habib 1987 CLC 1730; Farman Ali v. Muhammad Yousuf Ali PLD 1992 SC 330; Syed Ashfaq Ali Shah v. Syed Akhtar Ali Shah 1993 MLD 889; Ghulan Mustafa Sha v. Haji 1993 SCMR 256; Mehmood and others v. Chie Administrator, Auqaf 1996 SCMR 1508 and Abdul Latif v. Muhammad Yousuf PLD 1996 Kar. 365 distinguished.
Haji Ghulam Sarwar v. Daya Ram 1975 SCMR 179; M.A. Latif Faruqui v. National Bank of Pakistan PLD 1981 Kar. 645; Hudaybia Textile Mills Ltd. a4d others v. Allied Bank of Pakistan Ltd. and others PLD 1987 SC 512; Shah Wali v. Allah Bakhsh 1999 CLC 45; Government of the Punjab through Secretary (Services), Services General Administration and Information Department, Lahore and another v. Muhammad Saleem PLD 1995 SC 396; Mian Muhammad Abdul Khaliq v. M'. Abdul Jabbar Khan and oters PLD 1953 Lah. 147 and 1974 SCMR 162 ref.
Kamal Azfar alongwith Salim Salam Ansari for Appellants.
Mansoorul Arfin.for the Intervenor
Riaz Kadir Brohi for Respondents
Shahab Sarki, Advocate.
Date of decision: 8th October, 1999
P L D 2000 Karachi 333
Before Ghulam Nabi Soomro and S.A. Rabbani, JJ.
AHMAD YOUSUF ALI RIZVI and others---Petitioners
versus
MUNAWAR ALI BUTT and others---Respondents
Constitutional Petition No. D-1176 of 1998, decided on 8th June, 2000.
(a) Constitution of Pakistan (1973)--
----Art.199---Constitutional petition---Locus standi to file---Being a party to a previous litigation, is not a pre-condition for approaching High Court for exercise of jurisdiction under Art. 199 of the Constitution---Any aggrieved person is entitled to move for exercise of such jurisdiction.
(b) Constitution of Pakistan (1973)--
Art. 93---Adviser---Appointment in Provinces ---Constitutionality--Insertion of an express provision for appointment of Advisers at the Federal level meant that such an express provision was necessary to authorise such appointment---As an essential corollary, therefore omission of such a provision in the case of Provinces would mean a prohibition and inability in respect of appointment of an Adviser----- Adviser like that provided for in Art.93 of the Constitution, could not be appointed in the Provinces----.
(c) Constitution of Pakistan (1973)-
---Arts. 93 & 260 ---adviser provided for in Arts. 93 & 260 of the constitution ---distinction---Adviser provided for in Art.93 of the constitution is not the same as Adviser to Prime Minister or Adviser to Chief Minister mentioned in Art.260 of the constitution and both are of two different categories
(d) Constitution of Pakistan (1973)-
----Art.93---Adviser. Power of ScopeGiving power of Minister to an unauthorised adviser would be against the concept of elected Government envisaged by the constitution.
(e) Constitution of Pakistan (1973)--
----Art. 139(3)---Government of Sindh Rules of Business, 1986, R.6---Vires of R.6 of Government of Sindh Rules of Business, 1986---Allocation and transaction of business---Powers of Governor---Appointment made by Governor in exercise of his powers under Art.139(3) of the Constitution--Validity---Governor had been empowered to make rules for the allocation and transaction of the business of the Provincial Government---Such rules did not include powers of making any appointment as the same was beyond the scope and purposes of Rules which conferred powers for allocation and transaction of the business of the Provincial Government---Provision of R.6 of Government of Sindh Rules of Business, 1986 being beyond the powers of the Governor conferred by Art. 139(3) of the Constitution, R.6 was ultra vires, void ab initio and of no legal effect.
(f) Constitution of Pakistan (1973)--
----Art. 199---Government of Sindh Rules of Business, 1986, R.6--Constitutional petition---Allotment of plot by Adviser to the Chief Minister---Validity---Where appointment of the Adviser was invalid and without lawful authority, any order passed by such Adviser was also without lawful authority and of no legal effect.
1990 MLD 389 ref.
Petitioner No. l in person.
Abdul Aziz Khan for Respondent No.6.
Arif Bilal Sherwani for Respondent No.7.
Moin Azhar for Respondent No.9.
Raja Qureshi, A.-G. and Ainuddin Khan, A.A.-G. for the State.
Dates of hearing: 1st and 2nd June, 1999.
P L D 2000 Karachi 338
Before Ghulam Nabi Soomro and S.A. Rabbani, JJ
ABDUL KHALIL ---Appellant
versus
THE STATE---Respondent
Criminal Appeal No. 172 of 1999, decided on 14th March, 2000.
Explosive Substances Act (XI of 1908)---
----Ss. 5 & 7---West Pakistan Arms Ordinance (XX of 1965), S.13-E--Appreciation of evidence---Accused was not charged with an offence falling within the purview of the Explosive Substances Act, 1908, nor the consent of the Provincial Government or an officer authorised in such behalf by the Provincial Government had been obtained for the trial of accused as required by S.7 of the said Act---Conviction and sentence of accused under S.5 of the Explosive Substances Act, 1968 by the Trial Court ' were consequently set aside---Accused, however, was liable to be convicted under S. 13-E of the West Pakistan Arms Ordinance, 1965 on the basis of evidence available on the record and he was convicted thereunder accordingly and sentenced to imprisonment already undergone by him.
Shaukat Hussain Durrani for Appellant.
S. Jalil A. Hashmi, Asstt. A.-G. for the State.
Date of hearing: 14th March, 2000.
P L D 2000 Karachi 339
Before Abdul Hamid Dogar and S.A. Rabbani, JJ
Mst. QAMER-UN-NISSA SOOMRO---Applicant
versus
THE STATE and 2 others---Respondents
Criminal Revision No.24 and Miscellaneous Application No.343 of 2000, decided on 11th April, 2000.
Suppression of Terrorist Activities (Special Courts) Act (XV of 1975)---
----Ss. 4, 5 & Sched., cl.(ii-a), (c)---Criminal Procedure Code (V of 1898), S:561-A---Special Court, jurisdiction of ---F.I.R. showed that the accused had used Kalashnikov in the occurrence---Case was initially challaned before the Sessions Judge, as Sessions case but subsequently the same was transferred to the Special Court---Case was once against transferred from the Special Court to the Court of Sessions during the pendency of the trial-- Validity---Where the weapon of offence mentioned in the F.I.R. was Kalashnikov and there remained more than six witnesses to be examined and the fate of the case was to be decided on the conclusion of the trial, case fell within the ambit of Suppression of, Terrorist Activities (Special Courts) Act, 1975 and was triable by. Special Court for Suppression of Terrorist Activities---Case was ordered to be withdrawn from the file of the Sessions Judge and transferred to the file of the Special Judge.
Allahdin and 18 others v. The State and another 1994 SCMR 717 and Azhar Hussain v. Government of Punjab and others 1992 PCr.LJ 2308 distinguished.
1999 PCr.LJ 476 rel.
M.A. Kazi for Applicant.
Syed Jalil A. Hashmi, Asstt. A.-G. for the -State, Shaikh Mir Muhammad for Respondent No-.2.
P L D 2000 Karachi 343
Before Zahid Kurban Alavi, J
ABDUL WAHAB---Plaintiff
versus
KARACHI ELECTRIC SUPPLY CORPORATION through Managing Director and 2 others---Defendants
Suit No.508 of 1989, decided on 10th December, 1999.
Fatal Accidents Act (XIII of 1855)---
----S. 1---Fatal accident---Suit for damages---Damages, determination of--Principles---Fatal Accidents Act, 1855 itself did not' lay down any principle for calculating measures of loss---Assessment of damages in such case must necessarily be to some extent of a rough and approximate nature based more or less on guesswork---No definite or hard and fast rule could be laid down as to the matter which should be taken into account, but that much could be said that only such damages could be given that could be shown to have been financially suffered by those who had brought the action---Measure and award of damages differed even from Court to Court---Determination of quantum must be liberal not niggardly since law valued life and limb in a generous scale---Fatal Accidents Act, 1855 was a beneficial enactment and its basic purpose was to provide compensation to specified . statutory beneficiaries who had lost their bread earners owing to wrongful act of wrongdoers---While construing beneficial enactment, Court could take into consideration object for which it was enacted and mischief which it intended to suppress---If two possible constructions of a provision of such a statute were possible, one favoured the class of persons for whose benefit statute had been enacted, would be preferred---When a girl of 19 years died leaving behind father and mother respectively at ages of 43 and 42 years, on basis of 70 years as average life span in Pakistan, a loss of pecuniary benefit for a period of 28 years would be assessed on basis of earning capacity of the deceased girl---Defendants having been held responsible .for causing fatal accident and liiable to pay compensation to father and mother of the deceased girl; amount of compensation was determined taking into consideration earning capacity and remaining expected age of deceased accordingly.
Sri Manmatha Nath Kuri v. Moulvi Muhammad Mukhlesur Rahman PLD 1969 SC 565; AIR 1980 SC 1354;1998 SCMR 440 and Viqar Ahmed and others v. Blue Lines Air-conditioned Coach Services 1989 CLC 229 ref.
Nasir Maqsood for Plaintiff.
Sohail H.K. Rana for Defendants.
P L D 2000 Karachi 348
Before S. Ahmed Sarwana, J
MUHAMMAD YOUNUS---Petitioner
versus
Mst. KANIZ FATIMA ---Respondent
Constitutional Petition No.S-253 of 2000, decided on 13th July, 2000
(a) Muhammadan Law---
---- Khula'---Right of wife to terminate marriage contract---Scope---Where the parties were unable to live in harmony, the Holy Qur'an has given wife the right to seek termination of the marriage contract, provided she returns the dower or part of the same to the husband.
Al-Qur'an: Surah Al-Baqarah 2, Ayat 229 rel.
(b) Muhammadan Law---
---- Khula'---Right of wife to .terminate marriage contract---Scope and procedure.
Sahih al-Bukhari, Vol.7, Haidth No. 197 rel.
(c) West Pakistan Family Courts Act (XXXV of 1964)---
----S. 5---Dissolution of Muslim Marriages Act (VIII of 1939), S.8---Constitution of Pakistan (1973), Art.199---Constitutional petition--Maintainability---Dissolution of marriage on the basis of. Khula' -Accusation of infidelity by husband against his wife---Husband failed to produce four witnesses in support of his allegation of adultery before the Family Court and repeated the same allegation in the High Court ---Effect--Where the husband did not produce the required witnesses before the Family Court, the same showed that the allegations were false---Such person was a Fasiq (liar, rebellious, disobedient to Allah) and according to Surah 24:17An-Nur of the Holy Qur'an, testimony of such person could not be accepted by the Court---Constitutional petition was patently mala fide and was liable to be rejected in circumstances.
Al-Qur'an: An-Nur, Surah 24 rel.
(d) West Pakistan Family Courts Act (XXXV of 1964)---
----Ss. 5 & 9---Qanun-e-Shahadat (10 of 1984, Arts. 117, 120 & 164--Constitution of Pakistan (1973), Art.199---Constitutional petition---Proving of fact---Burden---Producing audio cassette as proof of conversation--Husband intended to produce such cassette having, recorded intimate conversation with the wife in the privacy of their conjugal bed room--Validity---Where no evidence was recorded, it was not possible to fix an exact date of the conversation---Burden- to prove the conversation and its timing was upon the petitioner which he failed to discharge---Constitutional petition was dismissed.
(e) West Pakistan Family Courts Act (XXXV of 1964)---
----Ss. 5 & 9---Suit for dissolution of marriage---Written statement, filing of---Non-considering by Trial Court the contents of audio cassette produced by husband during the trial---Failure to file audio cassette alongwith gist of evidence that each witness was expected to give---No witness was produced by the husband to prove the contents of the audio cassette---Effect---Where the husband failed to provide such evidence as required by S.9 of West Pakistan Family Courts Act, 1964, Family Court did not commit any illegality in not considering the contents of the cassette in circumstances.
(f) West Pakistan Family Courts Act (XXXV of 1964)---
----S. 5---Dissolution of Muslim Marriages Act (VIII of 1939), S.8--Constitution of Pakistan (1973), Art.199---Constitutional petition--- Maintainability---Dissolution of marriage on. the basis of Khula'---Wife had no confidence in her husband who was a dishonest man she hated him and was not ready to join him at any cost---Wife was ready to forego her right of dower amount in consideration of Khula'---Evidence of the wife remained unrebutted and Family Court dissolved the marriage on the ground of Khula'---Validity---Family Court did not commit any illegality in deciding the suit in favour of the wife nor exercised its jurisdiction unlawfully or with material irregularity resulting in grave injustice which ought to be corrected by the High Court---Judgment of the Family Court was in accordance with the Injunctions of the Holy Qur'an---Constitutional petition of husband was dismissed in limine.
Al-Qur'an: Surah Al-Baqarah 2, Ayat 229; An-Nur, Surah 24; Sahih al-Bukhari, Vo1.7, Haidth No:197; Mst. Khurshid Bibi v. Baboo Muhammad Amin PLD 1967 SC 97; Sahibzada Shahryar Abbasi v. Samia Abbasi 1992 MLD 159; Muhammad Abbasi v. Mst. Samia Abbasi 1992 CLC 937 and Kaura v. Mst. Mansab Mai and another PLD 1981 Lah. 335 rel.
Ajmal Haider for Petitioner.
Date of hearing: 15th June, 2000.
P L D 2000 Karachi 357
Before Muhammad Roshan Essani and Ghulam Nabi Soomro, JJ
ISLAM---Appellant
versus
THE STATE---Respondent
Criminal Appeal No.D-23 of 1993(S), Criminal Appeals Nos. 142, 143 and 144 of 1995(K), decided on 15th May, 2000.
(a) Penal Code (XLV of 1860)---
----S. 365-A/ 149---Appreciation of evidence---Evidence of the. abductees was not reliable---Identification parade being defective identification of accused was inadmissible---Confession made by accused did not disclose the happenings and events relating to the crime---Neither any mention of demand or receipt of ransom was made in the said confession nor the places where the abductees were detained were disclosed therein---Judicial confession had even been retracted by the accused which was not corroborated by any other evidence and the same, therefore, could not form the basis of conviction---Accused were acquitted on benefit of doubt in circumstances.
(b) Penal Code (XLV of 1860)---
----S. 365-A/149---Appreciation of evidence---Sentence, reduction of---Abductees had fully implicated the accused in the commission of the offence---Identification of accused in the identification test did not suffer from any defect ---Abductees were not shown by the accused to have any enmity with him---Conviction of accused was upheld in circumstances---No evidence was, however, available on record to the effect that the accused had demanded or received any ransom from the abductees---Death sentence awarded to accused by Trial Court was reduced to imprisonment for life accordingly.
A.Q. Halepota, Nooruddin Sarki and Asif Ali -Soomro for Appellant.
S. Jalil Hashmi, Asstt. A.-G. for the State, Date of hearing: 14th March; 2000
P L D 2000 Karachi 364
Before Ata-ur-Rehman, J
MUHAMMAD USMAN--Plaintiff
versus
MUHAMMAD IQBAL and 2 others---Defendants
Suit No. 135 of 1991, decided on 3rd November, 1999.
(a) Fatal Accidents Act (XIII of 1855)--
----S. 1---Fatal accident---Suit for damages---Damages, determination of--Allegations of plaintiff/father of deceased with regard to rash and negligent driving of defendant which resulted into death of the deceased remained unrebutted---Eye-witnesses had also proved the allegations against defendant/driver of the bus and owner of the bus had not produced any witness to contradict version of the plaintiff--Rash and negligent driving of defendant and vicarious liability of owner of the bus having fully been proved, Court decreed the suit taking into consideration earning capacity and age of the deceased.
Mst. Noor Jehan through L.Rs. v. Syed Mujtaba Ali Naqvi 1991 SCMR 2300; Dr. Aziza and 5 others v. Muhammad Sarwar and others 19.97 MLD 2013; Mst. Maryam Mirza v. M.M. Qazi and 2 others. 1998 MLD 1656; Syed Akhtar Hussain, Zaidi v. Muhammad Yaqinuddin 1988 SCMR 753 and Punjab Road Transport Board v. Abdul Wahid Usmani and others PLD 1980 Lah. 584 ref.
(b) Fatal Accidents Act (XIII of 1855)--
----S. 1---Civil Procedure Code (V of 1908), O.Vl, R.1 & O.VIII, R.1--Suit for damages---Pleadings---Plea raised in written statement-7-Proof --Statement made by plaintiff on oath had not been contradicted on oath by the defendants though contradictory version was raised by them in their written statement---Defendants had not led any evidence in support of their version in written statement---Plea raised in written statement would have no effect in absence of evidence in support thereof ----Averments in pleadings had to be proved through evidence otherwise same could not be treated as evidence.
Muhammad Noor Alain v. Zair Hussain and 3 others 1998 MLD 1122; Messrs United Bank Ltd. v. Messrs Bombay Frontier Old Tyre Co. 1986 MLD 1613; Maryam Mirza v. M.M. Kazi 1988 MLD 1651; Messrs United Bank Ltd. v: Messrs Interior Decoration and Design Association 1983 CLC 244; Mst. Khairul Nisa and 6 others v. Malik Muhammad Ishaque and others PLD 1972 SC 25; Muhammad Khan v. Mst. Hajiran Khatoon 1984 CLC 3172; Punjab Road Transport Board v. M. Muhammad Sadiq 1987 CLC 933; Qadri Brothers Foundry and Workshop v.aMst. Safia 1988 CLC 2063 and Chaman Baig v. K.T.C. 1995 CLC 1714 ref.
(c) Pleadings--
---- Averments made in pleadings have to be proved through evidence to be treated as evidence.
Nasir Maqsood for Plaintiff.
Nemo for Defendants
Date of hearing: 3rd November, 1999.
P L D 2000 Lahore. 1
Before Mian Allah Nawaz and Nasim Sikandar, JJ
LEVER BROTHERS PAKISTAN LTD, and another ‑‑‑ Appellants
versus
GOVERNMENT OF PUNJAB through Secretary, Health Department. Civil Secretariat, Lahore and 3 others ‑‑‑ Respondents
Intra‑Court Appeal No.300 of 1999, decided on l6th September, 1999.
(a) West Pakistan Pure Food Ordinance (VII of 1960)‑‑‑
‑‑‑‑ Preamble ‑‑‑ Object of the Ordinance ‑‑‑ West Pakistan Pure Food Ordinance, 1960 was enacted with an object to consolidate and amend the law relating to preparation/sale of goods in the Province of West Pakistan.
(b) West Pakistan Pure Food Ordinance (VII of 1960)‑‑‑
S. 6 ‑‑‑ West Pakistan Pure Food Rules, 1965, Appendix 11, para. 19 ‑‑‑ Ice cream ‑‑‑ Composition of ‑‑‑ Deviation from formula stated in Appendix Il, para.19, West Pakistan Pure Food Rules, 1965 ‑‑‑ Effect ‑‑‑ Any deviation from the formula was punishable under S.6 of West Pakistan Pure Food Ordinance, 1960.
(c) General Clauses Act (X of 1897)‑‑‑
‑‑‑‑ S. 21 ‑‑‑ Making of Rules or Bye‑laws ‑‑‑ Governmental executive instructions ‑ ‑‑ ‑Scope ‑‑‑ Executive instructions/orders when issued by Authority/State functionary competent to frame/make Rules and if the same were precise, certain and general in nature, such instructions might be treated as having force of statutory rules.
Bashir Ahmad Khan v. Muhammad Ali Khan Chaudhry and others PLD 1960 SC 195, The United Netherlands Navigation Co. Ltd. v. The Commissioner of Income‑tax South Zone (W.P.),, Karachi PLD 1965 SC 412 Government of West Pakistan v. Nasir M. Khan and others PLD 1965 SC 106, Nazir Ahmad v. Pakistan and others PLD 1970 SC 451: Mukhtar Ahmad v. Government of West Pakistan PLD, 1971 SC 846; Crown Bus, Service v. Central Board of Revenue PLD 1976 Lah. 1487 and Fazal Elahi Ijaz v. Government of the Punjab PLD 1977 Lah. 549 ref.
(d) West Pakistan Pure Food Ordinance (VIII of 1960)‑‑‑
‑‑‑‑ Appendix II, para. 19 ‑‑‑ General Clauses Act (X of 1897), S.21 ‑‑‑ Preparation of ice‑cream ‑‑‑ Use of vegetable oil in such preparation ‑‑‑ Use of vegetable oil was a deviation from the formula prescribed for preparation of ice‑cream in Appendix 11, para. 19 of West Pakistan Pure Food Rules, 1965‑‑‑Such deviation was permitted by an executive order/letter which was not published ‑‑‑ Validity‑‑Such an executive order/letter could neither be treated as a mandatory proviso to para.19 of Appendix 11 of the Rules nor the same could be treated as consistent with the provisions, Of para.19 of Appendix TT of West Pakistan Pure Food Rules, 1965.
(e) Qanun‑e‑Shahadat (10 of 1984)‑‑‑
‑‑‑‑ Art. 114 ‑‑‑ Promissory estoppel ‑‑‑ Promissory estoppel, plea of ‑‑‑ Prerequisites and limitationS‑‑7Concept and principles of doctrine of promissory estoppel stated.
Concept of promissory estoppel is complex legal notion. In order to succeed under this plea, the person, who raises it, must show the presence of following circumstances:
(i) That the party, sought to be estoppel, or some person for whose representations such party is in law responsible, made a representation;
(ii) that the case which the party is sought to be estopped from making, setting up, or attempting to prove, contradicts in substance his original representation;
(iii) that such original representation was of a nature to induce, and was made with the intention of inducing the patty raising the estoppel, to alter his position to his detriment;
(iv) that the party raising estoppel actually altered his position to his detriment on the faith of such original representation;
(v) that the original representation was made to the party setting up the estoppel, or to, some person in right of whom he claims.
The doctrine of promissory estoppel. is ‑subject to the following limitations:
(1) The doctrine of promissory estoppel cannot be invoked against the Legislature or the laws framed by it because the Legislature cannot make a representation, (2) promissory estoppel cannot be invoked for directing the doing of the thing which was against law when the representation was made or the promise held out;
(3) no Agency or Authority can be held bound by the promise or representation not lawfully extended or given;
(4) the doctrine of promissory estoppel will not apply where no step has been taken consequent of the representation or inducement so as to irrevokably commit the property or the reputation of the party invoking it; and
(5) the party which has indulged in. fraud or collusion for obtaining some benefits under the representation cannot be rewarded by the enforcement of promise.
Pakistan v. Salahuddin and 3 others PLD' 1991 SC 546, Messrs Army Welfare Sugar Mills Ltd. and others v. Federation of Pakistan and others 19()' SCMR 1652; Gadoon Textile Mills v. WAPDA 1997 SCMR 641 and Crawford's Construction of Statute, Edn. Reprint, 1989 ref.
(f) Acquiescence‑‑‑
‑‑‑‑ Ratification by Legislature, rule of ‑‑‑ Application ‑‑‑ Conditions and principles ‑‑‑ Where Legislature had met ' for number of times after departmental practice/interpretation, contrary to rules, had been followed by departmental functionaries for number of years and with uniformity and consistency,, such acquiescing Legislature would be deemed to have ratified such practice ‑‑‑ Such principle was known as rule of ratification by Legislature on the premises of acquiescence.
(g) Qanun‑e‑Shahadat (10 of 1984)‑‑‑
‑‑‑ Art. 114‑‑Promissory estoppel ‑‑‑ Doctrine of promissory estoppel‑‑Applicability ‑‑‑ Where Governmental functionaries make promises/representation to any one who believes them and acts under them, then those functionaries are precluded from acting to the determent of, such persons/citizens ‑‑‑ Principle of promissory estoppel is applicable in such circumstances.
Director, Recruits Class 11 Engineering Officers' Association v. State of Maharashtra and others (1990) 2 SCC 715 ref.
(h) West Pakistan Pure Food Rules, 1965‑‑‑
‑‑‑‑ Appendix 11, para. 19 ‑‑‑ West Pakistan Pure Food Ordinance (VII of 1960), S.37 ‑‑‑ Intra Court Appeal ‑‑‑ Use of vegetable oil in ice‑cream ‑‑‑ Permission to use ve0jable oil in preparation of ice‑cream was granted by the Authority competent to make Rules And Regulations, but on the other hand the said Competent Authority had no power to amend, para. 19 in Appendix If of West Pakistan Pure Food Rules, 1965, as the same was related with preparation of ice‑cream‑'‑Issuance of such letter by the Competent Authority ‑‑‑ Validity‑‑‑Such letter could not be tainted as having been issued without lawful authority but the same suffered from irregular exercise of Authority ‑‑‑ Permission to use vegetable oil in preparation of ice‑cream, in circumstances, could be presumed to have been a relaxation by Subordinate Legislative Authority ‑‑‑ Such permission was neither offensive to any provision of authorising statute nor was in excess of power of delegatee ‑‑‑ Where such diviational arrangement had been in operation for more than a decade, the same could not be upset without cogent and highly strong reasons ‑‑‑ Provincial Government/Delegatee was directed to bring amendment in the Rules so as to remove anomalies in field in view of para. 19 of Appendix 11, West Pakistan Pure Food Rules, 1965.
Pakistan N. Sheikh Abdul Hamid PLD 1961 SC 21, Government of West Pakistan v. A‑A, Aziz PLD 1966 SC 188, Dr. Habib‑ur‑Rehman v. West Pakistan Public Service Commission PLD 1973 SC 144; Khan Faizullah Khan v. Government of Pakistan PLD 1974 SC 291. United Netherland Navigation v. the Commissioner of Income‑tax, South Zone, West Pakistan PLD 1965 SC 412 and Government of West Pakistan and another v. Nasir M.Khan and others PLD 1965 SC 106 ref.
(i) Constitution of Pakistan (1973)‑‑‑
‑‑‑‑ Art. 199 ‑‑‑ Courts are ordinarily reluctant to order Legislature or Subordinate Legislative Authority/Delegatee to perform its duties.
Messrs Narindar Chand Rem Raj and others v. Governor Administrator, Union Territory, H.P. and others AIR 1971 SC 2399 and Shaukat Ali Mian and another v. The Federation of Pakistan 1999 CLC 607 ref.
Hamid Khan for Appellants.
Zahid Hamid for Respondents.
P L D 2000 Lahore 20
Before Ch. Ijaz Ahmad, J
Messrs SYED BHAIS (PVT.) LTD. Through Company Secretary ‑‑‑ Petitioner
versus
GOVERNMENT OF THE PUNJAB, EXCISE AND TAXATION DEPARTMENT through Secretary and another ‑‑‑ Respondents
Writ Petition No.2036, of 1998, decided on 16th April, 1999
(a) Interpretation of statutes‑‑
‑‑‑‑ Determination of real field of legislation within which subject‑matter of the statute lay ‑‑‑ Principles ‑‑‑ Where Constitution distributes such powers between Federal and Provincial Law‑making bodies, an Act enacted by any such body should be examined to ascertain its "pith and substances or its true nature and character for the purposes of determining the real field of legislation within which subject‑matter of the Act lay.
Subrahmanyan's case 1940 FCR 188; Atiqa Begum's case AIR 1941 FC 16; Muhammad Yousaf's case PLD 1956 FC 395; Prafullah Kumar Mukher Jee's case AIR 1947 PC 60; Alberta's case AIR 1939 FC 53; Pir Rashid‑ud-Daula's case PLD 1971 SC 401; Province of East Pakistan and others v. Sirajul‑Haque Patwari and others PLD 1996 SC 854; AIR 1991 Pat. 40 and Understanding Statutes by S.M. Zafar rel.
1989 PTD 488; (1992) 65 Tax 315; Interpretation of Statutes by Bindra 8th Edn., 897; Interpretation of Taxation Statue by D.B. Mettan, p.95; AIR 1~5 PC 98; AIR 1930 SC 173; PLD 1966 Lah. 718; 1994 SCMR 712 and PLD 1992 Pesh. 191 ref.
(b) Interpretation of statutes‑
‑‑‑‑ Determination as to whether Act was enacted in accordance with the provisions of Constitution or not ‑‑‑ Principles stated.
For examining the Act or to see whether it was within the competence of the Legislature that had enacted it or whether it was ultra vires. It was necessary to examine its pith and substance.
In deciding whether particular Act was ultra vires the Legislature, the Court had to record true nature and character of the legislation to ascertain the class of subject to which it really belonged. The fact that an Act of provincial Legislature may, in some respect, trench upon a Federal subject was not the deciding factor.
PLD 1960 Lah. 407; AIR 1949 All. 513; AIR 1939 Mad. 361; PLD 1961 SC 176; PLD 1977 Kar. 524; PLD 1960 Lah..407, AIR 1949 All. 513; PLD 1953 PC 51; 1975 AJ&K 69; (AIR 1940 All. 272); PLD 1988 Lah. 725; PLD 1971 SC 811; PLD 1982 Kar. 470; PLD 1980 Dhaka LR 201; PLD 1980 Quetta 58; AIR 1946 Nag. 81; PLD‑ 1958 Pesh. 73; AIR 1942 Lah. 243; 1983 CLC 2923; PLD 1986 PCr.LJ 2994; PLD 1969 Lah. 209; PLD 1958 Lah. 985; PLD 1957 Kar. 320; 1999 SCMR 526 and PLD 1958 SC 499 ref.
(c) Constitution of Pakistan (1973)‑
‑‑‑‑ Art. 199‑‑‑Constitutional petition ‑‑‑ Power of High Court to take notice of events subsequent to the filing of Constitutional petition ‑‑‑ Scope‑‑‑High Court. can take notice of events subsequent to the filing of Constitutional petition.
PLD 1974 SC 228; PLD 1990 SC 1013,and 1990 CLC 1069 rel.
(d) Constitution of Pakistan (1973)‑
‑‑‑‑ Art. 4 ‑‑‑ Finance Act (XXII of 1997), Preamble ‑‑‑ Legislation of laws having retrospective effect ‑‑‑ Power of Legislature ‑‑‑ Provision of Art. 4 of the Constitution of Pakistan (1973), does not control the power of Legislature to frame laws having retrospective effect ‑‑‑ Only‑express limit imposed upon the power of such legislation is that the Legislature cannot make retrospective penal laws, meaning thereby that any other law including taxation law may, therefore, be made with retrospective effect under the Constitution.
1993 SCMR 1905; PLD 1991 SC 546; PLD 1969 SC 623; AIR 1990 SC 1637, AIR 1970 SC 169; AIR 1969 SC 59 and PLD 1969 SC 599 rel.
PLD 1992 Lah. 462; PLD 1993 SC 341; AIR 1961 SC 293; AIR 1989 SC 665; AIR 1968 SC 353 and AIR 1983 SC 130 ref.
| | | --- | | (e) Punjab Finance Act (IX of 1997)‑‑‑ ‑‑‑‑S. 7‑‑‑Impostion of tax on luxury vehicles‑‑‑Validity‑‑‑Constitution of Pakistan (1973), Art.199‑‑‑Constitutional petition‑‑‑Reasonable classification‑‑Applicability ‑‑‑Contention of petitioners was that mentioning of engine capacity in Punjab Finance Act, 1997 was unreasonable classification and same was not permissible under Art.18 of the Constitution of Pakistan (1973)‑‑‑Contention raised by petitioners was repelled holding that such reasonable classification was permissible. PLD 1976 SC 57; PLD 1976 SC 713 PLD 1975 SC 506 and AIR 1990 SC 1637 rel. PLD 1993 SC 341; PLD 1992 SC 563 and 1991 CLC 13 ref. (f) Interpretation of statutes‑‑‑ ‑‑Colourable legislation, doctrine of‑‑‑Bona fides or mala fides on the part of Legislature‑‑‑Determination‑‑‑Doctrine of colourable legislation does not involve any of mala fides or bona tides where the Legislature was competent to pass a particular law, motives which impelled the Legislature to frame the law was irrelevant AIR 1964 Madh. Pra. 118 and AIR 1953 SC 375 ref. (g) Constitution of Pakistan (1973)‑‑‑ ‑‑‑‑Arts. 141, 142 & 199‑‑‑Constitutional petition‑‑‑Federal and Provincial Laws‑‑‑Legislation‑‑‑Extent‑‑‑Overlapping of two legislative fields‑‑‑Judicial review by High Court‑‑‑Scope‑‑‑Where legislative powers were distributed between the two legislative bodies and such legislative fields overlapped, High Court could ascertain to what degree and to what extent, the authority to deal with matters falling within such classes of subjects existed in each Legislature, and to define the limits of respective powers‑‑‑To prevent any conflict between the two provisions, both the provisions be read together and the language of one interpreted and modified by that of the other. AIR 1990 SC 1367; AIR 1966 SC 1571; AIR 1954 SC 375; AIR 1966 SC 416; AIR 1957 SC 297; AIR 1977 SC 2279; AIR 1959 SC 308; AIR 1960 SC 796; AIR 1962 SC 458; PLD 1983 SC 453 and AIR 1992 SC 580 ref. (h) Interpretation of statutes‑‑ |
‑‑‑‑Legislation‑‑‑Limits of Legislature‑‑‑Duty of Court‑‑‑Court must presume that the Legislature knows its limits and legislates for those who are actually within its jurisdiction coupled with the principle that the enactment should be interpreted which will make such enactment operative and not inoperative.
AIR 1959 SC 1102 and AIR 1963 SC 853 rel.
(i) Interpretation of statutes‑‑‑
‑‑Debates of members of the Legislature ‑‑‑ Relevance ‑‑‑ Where debates made at the time when the law was being enacted were available, the Courts could refer to such debates while interpreting that statute ‑‑‑ Where, however, the language of the enactment was clear, such debates were hardly relevant.
PLD 1957 Dhaka 342 ref., (j) Constitution of Pakistan (1973)‑
‑‑‑‑ Preamble, Part 111, Chap. 2 (Arts. 50 to 100] & Part IV, Chap. 2 (Arts 106 to 128] ‑‑‑ Principle of morality‑‑‑Fundamental duty and obligation of the Legislatures to frame the laws for the welfare of the public ‑‑‑ Principle of morality is of the considerations to see the validity of any Act.
PLD 1993 SC 473 ref.
(k) Constitution of Pakistan (1973)‑‑
‑‑‑‑ Art. 142(c)‑‑‑Residuary power of Provincial Legislature ‑‑‑ Scope ‑‑‑ Where any Act was not covered specifically by either of the two lists, then it was the prerogative of the Provincial Legislature to frame the law by virtue of Art. 142(c) of the Constitution being residuary power of Provincial Legislature.
(l) Punjab Finance Act (IX of 1997)‑‑
‑‑‑‑ S. 7‑‑‑Constitution of Pakistan (1973), Art. 142(c) ‑‑‑ Imposing tax on luxury vehicles by Provincial Legislature ‑‑‑ Validity ‑‑‑ Imposing of such tax was covered under Item 33, of the Concurrent Legislative List and not in ‑Item No.50 of the, Federal Legislative List of the Constitution ‑‑‑ Imposition of such tax was the prerogative of the Provincial Legislature.
Interpretation of Statutes by Bindra 8th Edn., p.907, Monogram 15; AIR 1939 PC 53,; AIR 1962 SC 137; AIR 1953 SC 375; 1989 PTD 488; PLD 1983 SC 457; Fauji Foundation's case PLD 1995 SC 66; Sabir Shah's case PLD 1977 SC 11; Zulfiqar Ali's case 1998 SCMR 1156; PLD 1995 SC 432; PLD, 1997 SC 582 and PLD 1977 SC 426 ref.
(m) Punjab Finance Act (IX or 1997)‑‑
S. 7 ‑‑‑ Wealth Tax Act (XV of 1963), S.14‑D ‑‑‑ Conflicts between two statutes ‑‑‑ Effect ‑‑‑ Punjab Finance Act, 1997, did not fall in Item No.50 of the 4th Sched of Federal Legislative List of the Constitution ‑‑‑ No inconsistency between S. 14‑D of Wealth Tax Act, 1963 and S. 7 of Punjab Finance Act, 1997 existed and provisions of both the statutes could co‑exist.
PLD 1995 Lah. 56 rel.
(n) Punjab Finance Act (IX of 1997)‑
‑‑‑Ss. 5 & 7 ‑‑‑ Constitution of Pakistan (1973), Art.199 ‑‑‑ Constitutional petition ‑‑‑ Imposition of one time tax. on luxury vehicles ‑‑‑ Rules framed for imposition of such tax vide Notification dated 23‑4‑1998 ‑‑‑ Validity ‑‑‑ Rules framed‑by Government for recovery of such tax did not provide guidelines‑‑Rules having not been properly framed to achieve the purpose of Punjab Finance Act, 1997 were, thus, ultra vires ‑‑‑ Constitutional petition was disposed of in the light of the statement made by the Advocate‑General clarifying the taxation structure.
PLD 1964‑SC 718; PLD 1997 Lah 617; PLD 1988 SC 146; PLD 1966 SC 388; AIR 1981 SC 1824; AIR 1982 SC 149; 1998 CLC 187; PLD 1958 SC 4 1; PLD 1964 SC 673; PLD 1966. Dhaka 472; PLD 1967 SC 554; 1998 CLC 745; AIR 1969 SC 197; AIR 1968 SC 353; AIR 1983 SC 130; 1993 SCMR 1905; PLD 1997 SC 80; PLD 1992 Kar. 470; 1993 SCMR 1905; PLD 1964 Kar. 399; AIR 1980 SC 27 1; AIR 1980 SC 1042; AIR 1978 SC 264, Interpretation of Law, 7th Edn., p.387; PLD 1997 SC 582 and 1986 SCMR 1917 ref.
Syed Mansoor Ali Shah for Petitioner
Irfan Qadir for Respondents.
Muhammad Nawaz Bhatti, A.A.‑G., Ghulam Haider Al‑Ghazali, A.A.‑G. for Government of Punjab and Sher Zaman Bhatti, Dy. Attorney General.
Dates of hearing: 9th October; 3rd, 20th, 27th and 30th November, 2nd, 91h, 10th, l7th December, 1998; 26th January, 9th February and 10th Match, 1999.
P L D 2000 Lahore 50
Before Javed Buttar and Dr. Munir Ahmad Mughal, JJ
SAFDARIQBAL ‑‑‑ Petitioner
Versus
THE STATE ‑‑‑ Respondent
Criminal‑ Miscellaneous No.755‑B of 1999, decided on 17th August, 1999.
(a) Telegraph Act (XIII of 1885)‑
‑‑‑‑ Ss. 25 & 25‑D ‑‑‑ Suppression of Terrorist Activities (Special Courts) Act (XV of 1975), SA & Sched., Part (e) ‑‑‑ Jurisdiction of Special Court ‑‑‑ Obnoxious or threatening telephone calls ‑‑‑ Such telephone calls were covered under S.25‑B of 'telegraph Act, 1885, and the provisions of S.25 of Telegraph Act, 1885 was not applicable ‑‑‑ Offence under S.25‑D of Telegraph Act, 1885 having not been included in the Schedule of Suppression of Terrorist Activities (Special Courts) Act, 1975, Special Court had no jurisdiction over such act.
Tariq Altaf v. District Magistrate, Lahore and 3 others 1994 PCr.LJ 1557 and Muhammad Tahir Abid v. The State and another 1993 PCr.LJ 1211 rel.
(b) Criminal Procedure Code (V of 1898)‑‑‑
S. 497 ‑‑‑ Telegraph Act (XIII of 1885), S.25‑13 ‑‑‑ Bail, grant of ‑‑‑ Allegation against the accused was of making obnoxious and threatening telephone calls ‑‑Voice print of the accused was not available with the Telephone Department ‑‑Whether the call was made by the accused or by someone else was a matter of further inquiry ‑‑‑ Offence did not fall within the prohibitory clause of S.497, Cr.P.C.‑‑‑Grant of bail in such‑like case being a rule, bail was allowed.
Zafar Abbas Mashhadi for Petitioner.
Syed Zulfiqar Abbas Naqvi for the Complainant.
Mobin Ahmed for the State.
P L D 2000 Lahore 53
Before Zafar Pasha Chaudhry, J
MUHAMMAD and 2 others ‑‑‑ Petitioners
Versus
KHIZAR HAYAT and 4 others ‑‑‑ Respondents
Writ Petition No.21584 of 1997, decided on 6th May, 1999.
(a) Criminal Procedure Code (V of 1898)‑‑‑
‑‑‑‑ Ss. 133(2) & 139‑A(2) ‑‑‑ Jurisdiction of Civil Court not barred where civil, right of a party has to be determined‑Dispute arising with, regard‑ to the' determination of a right would be adjudicated upon by the Civil Court and the same would prevail over any tentative order passed by the Magistrate under S. 133, Cr. P.C. or any other succeeding section of 'the Chapter.
(b) Criminal Procedure Code (V of 1898)‑‑‑
--- S. 133 ‑‑‑ Constitution of Pakistan (1973), Art.199 ‑‑‑ Constitutional petition Nuisance, removal of ‑‑‑ Averments of the parties and the report of the Local Commission showed that the disputed construction on. the property existed for the last many years and the obstruction as alleged by the respondent in the application was not of the nature where proceedings under S.133, Cr.P.C. could readily be attracted ‑‑‑ Disputed question of fact being involved in the matter which could not be inquired into in the Constitutional petition, the proper forum was a Civil Court where the parties had already gone ‑‑‑ Fact in issue between the parties, in circumstances, Was directed to be adjudicated upon by the Civil Court after collecting relevant evidence which was also competent to regulate the interim user by way of interim injunction and its order would have prevalence‑‑Constitutional petition was disposed of with said observations.
Azam Khan and others v. The State 1989 PCr.LJ 2286 and Allah Dad v. Abdul Karim 1972 PCr.LJ 680 ref.
Rana Abdul Majeed for Petitioners.
Nazir Ahmed Qureshi for Respondent No. 1.
P L D 2000 Lahore 56
Before Syed Zahid Hussain, J
SULEMAN KHAN ‑Petitioner
Versus
Sh. ABDUL RAZZAQUE and others‑‑Respondents
Writ Petition No.623 of 1984, heard on 28th July, 1999
Constitution of Pakistan (1973)‑‑‑
‑‑‑Art. 19.9 ‑‑‑ Constitutional jurisdiction, exercise of ‑‑‑ Scope‑‑‑Conduct of petitioner'‑‑‑Relevancy ‑‑‑ Petitioner earlier had chosen to participate in proceedings before the respondent‑Authority without any objection and took a chance for a favourable order‑.‑‑Order having been passed by Authority against petitioner, he was estopped to raise any such question before High Court‑‑Conduct of a person invoking jurisdiction of High Court under Art. 199 of the Constitution was of vital significance and importance ‑‑‑ All orders, challenged before High Court in Constitutional jurisdiction need not be interfered with‑‑High Court could decline the relief, even though order impugned could be termed as one without jurisdiction.
Abdul Wahab and others V. Habib Ali and others PLD 1969 Lab. 365; Muhammad Sharif and another v. District Judge, Sahiwal and others PLD 1981 SC 571;. Haji Muhammad Asghar v. Malik Shah Muhammad Awan and another PLD 1986 SC 542 and Muhammad Hussain Jaffari v. Mst. Maryam Bibi and 2 others 1985‑CLC 451 ref.
Malik Yousuf Farooq for Petitioner, S.M. Rasheed for Respondent No.3
Date of hearing: 28th July, 1999.
P L D 2000 Lahore 59
Before Z4ar Pasha Chaudhry, J
ABDUL GHAFOOR ‑‑‑ Petitioner
Versus
THE STATE ‑‑‑ Respondent
Criminal Miscellaneous Nos.2108‑B and 1978‑B of 1999, decided on 31st May, 1999.
Criminal Procedure Code (V of 1898)‑
---S. 497(l), third and fourth provisos ‑‑‑ Penal Code (XLV of 1860), S.302/34/109‑'‑Bail on ground of statutory delay ‑‑‑ Accused had remained involved in a number of criminal cases at different times in different police stations and they could certainly be treated as hardened and desperate criminals ‑‑‑ Accused in view of his previous record and history was not entitled to the concession of bail on the ground of statutory delay ‑‑‑ Bail was declined to accused accordingly.
1993 SCMR 65; 1998 SCMR 190; 1990 SC 934; 1997 SCMR 412; PLD 1982, SC 424; 1993 SCMR 525; 1997 PCr.LJ 917 and 1994 PCr.LJ 1327 ref.
R A. Awan for Petitioner.
Burhan Moazzam Malik for the Complainant.
Muhammad Tufail Sindhu for the State.
P L D 2000 Lahore 62
Before Ihsan‑ul‑Haq Chaudhry and Raja Muhammad Khurshid, JJ
NOOR BAT KHAN‑‑‑Appellant
versus
CUSTOMS, EXCISE AND SALES TAX APPELLATE TRIBUNAL, LAHORE and 2 others‑‑‑Respondents
Civil Appeal No.24 of 1999, decided on 22nd April, 1999.
Customs Act (IV of 1969)‑‑‑
‑‑‑‑ S. 194‑B ‑‑‑ Confiscation of a bus used in transportation of contraband narcotics and ammunition‑‑‑Accused was the owner of the bus, though he was not found inside the vehicle at t ' he time of raid, but on the statements of the arrested driver and cleaner he was linked with the offence ‑‑‑ Recovered narcotics goods and the ammunition were artfully concealed in the specially designed cavities in the bus ‑‑‑ Nothing was available on record to show that those cavities were not prepared at a workshop under the supervision of the appellant and his co‑accused ‑‑‑ Effect ‑‑‑ Wher6 the appellant was clearly linked with the nefarious and illegal transportation of drugs and ammunition, the orders of the Customs Authorities and that of Appellate Tribunal called for no interference by High Court.
Muhammad Jan and another v., Deputy Collector of Customs and 2 others PLD 1988 Lah. 177 and Haji Abdul Razzak v. 'Pakistan through Secretary, Ministry of Finance, Islamabad and another PLD 1974 SC 5 ref.
Shahid Azeem, Advocate
P L D 2000 Lahore 65
Before Karamat Nazir Bhandari, J
Mst. ZARINA BEGUM ‑‑‑ Petitioner
versus
INSPECTOR‑GENERAL OF POLICE, PUNJAB, LAHORE and 15 others ‑‑‑ Respondents
Writ Petition No.7893 of 1999, decided on 2nd September, 1999, (a) Penal Code (XLV or 1860)‑‑‑
‑‑‑‑S. 342/344/347/363 ‑‑‑ Constitution of ' Pakistan (1973),Art. 199 ‑‑‑Constitutional petition ‑‑‑ Deletion of some offences from the F. I. R. ‑‑‑Validity ‑‑Investigating Officers were of the view that the accused Police Officer while conducting raid on the house of the petitioner for the arrest of her husband and not finding him, there lifted her minor son aged 12 years who remained in the custody of police for 68 days and could only be recovered through the intervention of High Court by filing a habeas corpus petition‑‑‑Forcible snatching of the ‑boy in the opinion of the Investigating Officers was for the purpose of forcing his father to surrender and not for ransom ‑‑‑ Prosecution could not explain as to why on the aforesaid reasonably concluded facts a case of kidnapping was not made out against the accused police officer and only a case of wrongful confinement was made out against him ‑‑‑ Addition of S.365‑A or S.363,. P.P.C. in the challan had assumed importance in the case for the determination of the forum of trial also ‑‑‑ Opinion of the Investigating Officers excluding the offence of kidnapping from the challan suffered from mala fides in law and High Court was competent to pass corrective orders in exercise of its Constitutional jurisdiction under Art. 199 of the Constitution ‑‑‑ Investigating Officer was consequently directed to‑ add S.363, P.P.C. in the challan‑‑Constitutional petition was disposed of accordingly.
Anwar Ahmad Khan v. The State and another 1996 SCMR 24; Emperor v. Khawaja Nazir Ahmed AIR 1945 PC 18; Ghulam Muhammad v. Muzammal Khan and others PLD 1967 SC 317; Shahnaz Begum v. The Hon'ble Judges of the High Court of Sindh and Balochistan PLD 1971 SC 677 and Brig. (Retd.) Imtiaz Ahmad v. Government of Pakistan through Secretary, Interior Division, Islamabad and 2 others, 1994 SCMR 2142 ref.
(b) Constitution of Pakistan (1973)
‑‑‑‑ Art. 199 ‑‑‑ Constitutional jurisdiction ‑‑‑ Interference with investigation ‑‑‑ High Court in exercise of its Constitutional jurisdiction can correct the proceedings of the Investigator in order to ensure justice and fair play, provided the investigation is found to be based on mala fides, which is of two types, i.e., mala fides in fact and mala fides in law.
Shahnaz Begum v. The Hon'ble Judges of the High Court of Sindh and Balochistan PLD 1971 SC 677 ref.
Khalid Mehmood Farooqi for Petitioner, Muhammad Amin Lone, Asstt. A.‑G. Punjab with Khadim Bhatti, S.S.P. Range Crimes, Lahore for Respondents Nos. I to 7 and 13 to 16.
Syed Zahid Hussain Bokhari and Ch. Shahid Tabassam for Respondent No. 8.
Nemo for Respondents Nos. 9.to 12
Dates of hearing: 19th and 20th August, 1999
P L D 2000 Lahore 70
Before Ali Nawaz Chowhan, J
Mehr ZULFIQR ALI BABAR‑‑‑ Petitioner
versus
THE PROVINCE OF THE PUNJAB through Collector/Deputy Commissioner, Gujranwala and 2 others ‑‑‑ Respondents
Civil Revision Nd.353 of 1999, decided on 7th July, 1999.
(a) Civil Procedure Code (V of 1908)‑‑‑
‑‑‑‑ 0. XXVII, Rr. I & 2 ‑‑‑ Suit by or against Government ‑‑‑ Signing of pleadings ‑‑‑ Neither Special Pleader was appointed by the Government nor. written statement was verified by Deputy Commissioner ‑‑‑ Effect ‑‑‑ Where no such pleader was appointed and case was contested through District Attorney/Deputy Attorney, such officers in their ex officio capacity could act, on behalf of the Government, and could perform all such acts which were required to be performed by the Government in a judicial proceedings ‑‑‑ Signing of pleadings by Deputy Commissioner was not required in circumstances.
Government of N.‑W.F.P. v. Shah Alam 1989 CLC 1542 rel.
(b) Civil Procedure Code (V of 1908)‑‑‑
‑‑‑‑ S. 115 ‑‑‑ Revision ‑‑‑ Jurisdiction of High Court ‑‑‑ Material irregularity committed by Subordinate Courts ‑‑‑ Effect ‑‑‑ High Court is a Court of error and through its visitatorial jurisdiction can take a curative action against a material irregularity committed by its subordinate Courts‑Where any such irregularity comes to the notice of High Court through revision petition, the same calls for correction accordingly.
(c) Civil Procedure Code (V of 1908)‑‑
----0. VIII, R. 10, O.XXVII, R.2 & S. 115 ‑‑‑ Suit against Government ‑‑‑ Striking off defence ‑‑‑ Written statement duly signed by Deputy District Attorney was filed by the Government ‑‑‑ Trial Court struck off defence of the Government on the ground that written statement was not signed by Deputy Commissioner‑‑Validity‑‑Trial Court acted with material. irregularity by striking off defence of the respondent Government as there was a. written statement available on file and as such the Trial Court had ignored the provisions of O.XXVII, R.2, C.P.C.‑‑Case was remanded to Trial Court in circumstances.
Mian Nisar Ahmad for Petitioner.
G.H. Alghazli, Add]. A.‑G. for Respondent No. 1.
Kh. Saeed‑uz‑Zafar, Dy.Ar‑G. for Respondents Nos. 2 and 3.
Date of hearing: 1st July, 1999.
P L D 2000 Lahore 74
Before Raja Muhammad Sabir, J
Syed ZIA NOOR SHAH ‑‑‑ Petitioner
versus
SHAUKAT HUSSAIN AWAN and 4 others ‑‑‑ Respondents
Criminal Miscellaneous No.675/B/C of 1999, heard on 14th.July, 1999
Criminal Procedure Code (V of 1898)‑‑‑
‑‑‑‑ S.497(5) ‑‑‑ Penal Code (XLV of 1860),, S.324/34 ‑‑‑ Cancellation of pre‑arrest bail ‑‑‑ Counter‑version set up by the accused on the basis of a fake medical certificate having been belied by detailed inquiry, case against accused was not of two versions ‑‑‑ Complainant's version was fully supported by medical evidence and the accused had been found guilty during investigation‑‑Submission of challan in Court was hardly a ground for not interfering with bail granting order ‑‑‑ Accused were specifically assigned the role of having caused injuries with their respective weapons on the vital parts of the body of the complainant ‑‑‑ Pre‑arrest bail granted to accused by Trial Court was cancelled in circumstances.
Muhammad Hussnain Ibrahim and Irshad Ahmad Cheema for Petitioner.
Tariq Mahmood Sipra for Respondents Nos. I to 4
Ms. Raeesa Sarwar for the State.
Date of hearing: 14th July, 1999.
P L D 2000 Lahore 79
Before Karamat Nazir Bhandari, J
THE STATE‑‑‑Petitioner
Versus
MUHAMMAD ZAFARULLAH and 2 others ‑‑‑ Respondents
Criminal Original No.78. of 1994, heard on 25th May, 1999.
(a) Contempt of Court Act (LXIV of 1976)‑‑‑
S. 3/4 ‑‑‑ Contempt of Court ‑‑‑ Unconditional apology ‑‑‑ Effect‑‑Considerations ‑‑‑ Question whether an unconditional apology will purge the contempt is dependent upon facts and circumstances of a given case and the discretion of the Court ‑‑‑ Relevant considerations are; the nature and gravity of contempt, whether unconditional apology is tendered at the earliest, whether the Court is satisfied regarding its genuineness and contrition and further that it is not meant to avoid punishment ‑‑‑ Contemners have to show genuine remorse about the conduct of which they are accused of.
(b) Contempt of Court Act (LXIV of 1976)‑‑‑
S. 4 ‑‑‑ Contempt of Court ‑‑‑ Three accused were members of police force which existed to implement and protect the law ‑‑‑ Fourth accused being the Deputy District Attorney was a law man and a part and parcel of the ‑Court‑‑Conduct of the accused (contemners) as detailed in the reference made by the Acting District and Sessions Judge was simply atrocious, who had ridiculed the Judge/Court and lowered its authority and prestige, right in the view of the public ‑‑‑ Unconditional apology tendered by the contemners did not suffice to purge the contempt nor entitled them to discharge ‑‑‑ Accused were consequently convicted under S.4 of the Contempt of Court Act, 1976 (law applicable at the time of commission of contempt) and punished to simple imprisonment till rising of the Court with a fine of Rs. 100 each or in default to suffer simple imprisonment for seven days ‑‑‑ Lenient view in the matter of sentence had been taken on account of accuseds aforesaid apology and their throwing themselves at the mercy of the Court.
Muhammad Amin Lone, Asstt. A. ‑G., Punjab for, the State.
Farooq Bedar for Respondents Nos. I to 3
Muhammad Kazim Khan for Respondent No.4.
Date of hearing: 25th May, 1999.
P L D 2000 Lahore 84
Before Mian Allah Nawaz, J
Alhajj SHAHZADI MUMTAZ JAHAN and 2 others ‑‑‑ Petitioners
versus
Rana AKHTAR SAEED and 13 others ‑‑‑ Respondents
Writ, Petition No. 812 of 1995/BWP. decided on 21st July, 1999.
(a) West Pakistan Land Revenue Act (XVII of 1967)‑
S. 164‑‑‑Revisional power of Member,' Board of Revenue ‑‑‑ Scope ‑‑‑ Such powers were structured upon principle of adversary hearing and the power of suprintendence of subordinate Revenue Officer by Board.
(b) West Pakistan Land Revenue Act (XVII of 1967)‑‑‑
S. 164 ‑‑‑ Initiating suo motu action in revision‑Limitation ‑‑‑ Provisions of S. 164, 'West Pakistan Land ‑Revenue Act, 1967 provide a period of ninety days for filing ‑revision petition by an aggrieved party ‑‑‑ No period has been prescribed for initiating suo motu action.
(c) West Pakistan Land Revenue Act (XVII of 1967) ‑‑‑
‑‑‑‑ S. 164 ‑‑‑ Constitution of Pakistan (1973), Art. 199 ‑‑‑ Constitutional petition‑‑Suo motu revision petition was decided by Board of Revenue ‑‑‑ Such revision petition was ' sent to the Collector for a decision on the mutations challenged by the petitioner ‑‑‑ Board of Revenue passed such order of remand without making the vendees of transaction of sale as party to the proceedings and the case was remanded to the Collector who himself was a party to such revisional proceedings ‑‑‑ Validity ‑‑‑ Where vendees of transactions of sale were not made party in the. suo motu revision, any order passed by Board of Revenue affecting the rights of such vendees was without jurisdiction and without lawful authority and the same was set aside.
Abdul Latif v., Syed Najaf Hussain Shah and others 1993 MLD 881; Muhammad Aslam v. Federal Land Commission PLD 1976 Pesh. 66; Caltex. Oil (Pakistan) Ltd. v. Province of Sindh PLD 1978 Kar. 958; Muhammad Aslam khan v. Settlement Commissioner (Lands) 1983 CLC 2991; Abdul Karim v. Province of Punjab PLD 1994'Lah. 334; Government of N.‑W.F.P. v. Abdul Malik 1994 SCMR 833; State v. Abdul Hamid Jatoi PLD 1973 Rev. 29 and Khair Din v. 1. U. Khan PLD 1968 Lah. 11 ref.
(d) Natural justice, principles of‑‑‑
‑‑‑‑ Authority has no jurisdiction to pass an order against a person who is not before it.
J.I. Jaffaree Slarpore for Petitioners.
Ch. Muhammad Ashraf Wahla for Respondents.
Date of hearing: 7th June, 1999.
P L D 2000 Lahore 90
Before Tanvir Ahmad Khan and Karamat Nazir Bhandari, JJ
THE STATE ‑‑‑ Appellant
Versus
MANSOOR‑UR‑REHMAN KHAN AFRIDI ‑‑‑ Respondent
Criminal Original No. 1332‑W of 1998, decided on 10th June, 1999.
(a) High Court (Lahore) Rules and Orders‑‑
‑‑‑VOI‑ V, Chap. 4‑J, R. 2 ‑‑‑ Civil Procedure Code (V of 1008), O.XXIII, R. 1Q) ‑‑‑ Constitution of Pakistan (1973), Art. 199 ‑‑‑ Constitutional petition‑‑Filing of second petition on same subject‑matter ‑‑‑ Where earlier Constitutional petition was withdrawn without seeking permission of the Court to file fresh petition, the second Constitutional petition could not be filed.
1979 CLC 829; PLD 1957 (W.P.) Kar. 848; PLD 1970!SC 1; 1969 SCMR 269; 1,985 CLC 2805; 1996 CLC 2425; PLD 1989 SC 246; PLD 1959 SC (Pak.) 287; 1970 SCMR 141; PLD 1990 SC 596; 1991 MLD 571 and, PLD 1992 Lah. 420, rel.
(b) Administration of justice‑‑‑
‑‑‑‑Certainty and finality of the causes enhance the dignity of the Court.
(c) Administration of justice‑
‑‑‑‑ Bar and Bench are two wheels of chariot involved in the dispensation of justice ‑‑‑ Both are supplementary and complimentary to each other ‑
(d) Contempt of Court Act (LXIV of 1976)‑‑
‑‑‑‑ S. 3 ‑‑‑ Constitution of Pakistan (1973), Art. 204 ‑‑‑ Contempt of Court‑‑Filing of second Constitutional petition without permission of the Court and mentioning of wrong number of the earlier petition ‑‑‑ Tender of apology by contemners‑‑7Contempt notices were issued to the counsel and the petitioner both contemners on the ground that earlier Constitutional petition was dismissed as withdrawn and without any permission of the Court to file the fresh petition ‑‑‑ Petitioner through same counsel filed the second petition on the same subject and correct number of the earlier petition was not mentioned ‑‑‑ Effect‑‑Counsel did not act within the framework of ethics of profession and committed such acts which clearly fell within the ambit of contempt of Court ‑‑‑ Furthermore, the petitioner was the beneficiary and active participator of such acts ‑‑‑ Both the counsel and the petitioner were found guilty of contempt of Court ‑‑‑ Taking into consideration the rule of healthy relationship between the Bench and the Bar as well as the standing of the counsel in profession, lesser penalty of reprimand was awarded ‑‑‑ Following the rule of consistency, the petitioner too was reprimanded ‑‑‑ Suo motu contempt proceeding was decided accordingly.
(e) Contempt of Court Act (LXIV of 1976)‑‑
S. 3 ‑‑‑ Constitution of Pakistan (1973), Art.204 ‑‑‑ Contempt of Court‑‑Tender of apology‑‑‑Effect ‑‑‑ Tender of apology though does not itself purge the wrong committed by the contemner, it certainly reduces the gravity.
Dr. Khalid Ranjha and Rana Ijaz Ahmed Khan for the State.
Ch. Hamid‑ud‑Din for Respondent
Ashtar Ausaf, A.‑G.
Date of hearing: 10th June, 1999.
P L D 2000 Lahore 95
Before Raja Muhammad Sabir, J
BUSHRA BIBI ‑‑‑ Petitioner
Versus
JUDGE FAMILY COURT, BAHAWALPUR and 2 others ‑‑‑ Respondents
Writ Petition No. 1009 of 1998/BWP, heard on 20th May, 1999
(a) Muslim Family Laws Ordinance (VIII of 1961)
---S. 8 ‑‑‑ Dissolution of marriage on ground of Khula'‑‑‑Decree on sole ground of Khula' was granted by Trial Court on the condition that wife would retain three Tolas of gold received by her from the husband ‑‑‑ Evidence on record had proved that wife had not taken any ornaments with her while leaving the house of her husband‑‑‑Direction given by Trial Court for return of the gold in lieu of decree for Khula' was unwarranted for return of ornaments could only be ordered if it was established on record that same were given to her by husband and were in her possession.
(b) Muslim Family Laws Ordinance (VIII of 1961)‑‑‑
‑‑‑‑S. 8‑‑‑Dissolution of marriage on ground of Khula‑‑‑Return of dowry‑‑Articles of dowry were not given by husband to wife, but were given by her parents ‑‑‑ No condition for relinquishment of articles of dowry could be attached for granting decree on basis of Khula' and wife could not be directed to give Up articles of dowry ‑‑‑ Even otherwise dowry not being Zar‑i‑Khula', could not be declined to wife for a decree based on Khula'.
Muhabbat Hussain v. Mst. Naseem Akhtar and 4 others 1992 MLD 1294; Muhammad Samiullah'v. Muhammad Ilyas and others PLD 1987 Lah. .420; Dr. Akhlaq Ahmed v. Mst. Kishwar Sultana and others PLD 1983 SC 169; Dr. Anees Ahmad v. Mst. Uzma PLD 1998 Lah. 52; Sughran Begum v. Additional District Judge and others 19 ' 92 CLC 1733; Bibi v. Ghularn Rasooll alias Sullah and another PLD 1997 Lah. 108; Muhammad Shabbir v. Mst. Zahida and others 1991 CLC 1541 and Dilshad v. Judge, Family Court, Kharian and another 1991 CLC 1564 ref.
(c) Muslim Family Laws Ordinance (VIII of 1961)‑‑‑
---S. 8 ‑‑‑ Dissolution of marriage on ground of Khula'‑‑‑Decree on sole ground of Khula' was granted by Trial 'Court on condition that wife would return three Tolas of gold or its price to husband, would not claim dower, dowry or any maintenance allowance ‑‑‑ Evidence on record had proved that wife had not taken any ornaments with. her while leaving the house of her husband and dowry being not Zar‑i‑Khula' could not be declined to wife for a decree based on Khula'‑‑Wife, in ' circumstances, could not be directed to give up dowry ‑‑‑ Judgment and decrees of Khula' to the extent of return of golden ornaments and dowry were declared to be without lawful authority, but were maintained regarding dower and maintenance.
Sughran Begum v. Additional District Judge and others. 1992 CLC 1733 ref.
Qazi Muhammad Mukhtar for Petitioner.
Ehsan‑ul‑Haq Tanveer for Respondents.
Date of hearing: 20th May, 1999.
P L D 2000 Lahore 101
Before Mian Allah Nawaz and Muhammad Zafar Yasin, JJ
ABDUL HAQ and 2 others ‑‑‑ Appellants
Versus
THE RESIDENT MAGISTRATE, UCH SHARIF, TEHSIL AHMEDPUR EAST, DISTRICT BAHAWALPUR and 6 others ‑‑‑ Respondents
Intra‑Court Appeal No.49 of 1998/BWP, decided on 6th April, 1999.
Specific Relief Act (I of 1877)‑‑
---S. 9‑‑West Pakistan Urban Rent Restriction Ordinance (VI of 1959), S. 13‑‑‑Constitution of Pakistan (1973), Art. 199‑‑‑LaW Reforms Ordinance (XII of 1972), S. 3 ‑‑‑ Constitutional petition ‑‑‑ Maintainability ‑‑‑ Adequate remedy‑‑ Efficiency ‑‑‑ Dispossession from shops ‑‑‑ Remedy ‑‑‑ Appellants were tenants of Authorities in respect of shops in dispute ‑‑‑ Shops having been sold by Authorities to other persons, tenants were dispossessed from the shops forcibly with the help of police ‑‑‑ Constitutional petition filed against said dispossession was dismissed by High Court‑‑‑Relationship between appellants and Authorities was that of tenant and landlord which was to be governed under West Pakistan Urban Rent Restriction Ordinance, 1959, but appellants were dispossessed from rented shops without any order from the Rent Controller who was forum of competent jurisdiction ‑‑‑ Appellants being tenants, could not be evicted from shops in question without due process of law‑‑‑Remedy against such illegal dispossession though was available to appellants under S.9, Specific Relief Act, 1877, but that remedy being not adequate appellants had rightly filed Constitutional petition before High Court against illegal action of the Authorities ‑‑‑ Order dismissing Constitutional petition of appellant/petitioner passed by High Court, was set aside in Intra‑Court Appeal ordering the Authorities to put back appellants in possession of their respective shops.
Muhammad Aslam v. Station House Officer and others 1993 MLD 152‑, Karam Dad and another v. Azad Government of the State of Jammu and Kashmir and others 1980 CLC 1119; Muhammad Mansur Ali Sarkar v. Dr. Kudrat Ali 1968 SCMR 244; Muhammad Mansha v. Mst. Irshad and others 1994 MLD 136; District Evacuee Trust Committee, Hyderabad v. Lakhano and 2 others PLD 1973 Note 19, p.30;, Raja Fida ur Rehman and 4 others v. Capital Development Authority, Islamabad 1996 MLD 1573; Sailesh Kumar and another v. Rama Devi AIR 1952‑ Pat. 339; Punjab‑ State Club, Simla v. Municipal Committee, Simla AIR 1959 Punj. 220; Sikandar and 2 others v. Muhammad Ayub and 5 others PLD 1991 SC 1041; Haji Muhammad Yousaf v. Commissioner, Faisalabad Division, Faisalabad and another 1997 MLD 2384; Kunhi Kornapen Kurupu v. Changarachan Kandil Chembata Arnbu 2 MHCR 313; Wali Ahmed Khan and others v. Ajudhia Kandu ILR 13 All. 537; Sofaeli Khan and another v. Woopean Khan and another 9 WR 123; Rudrappa Bin Snakppa v. Narsingrao Ramchandra Kablikar and another ILR 1905 Born. 213; Azim Khan v. State of Pakistan and another PLD 1957 (W.P.) Kar. 892; M. Ghani v. M.A. Mullick & Brothers and 3 others 1973 SCMR 90 and Syed Mehdi Hasnain v. Muhammad Ayub and another 1970 SCMR 434 ref.
Rana Sardar Ahmad for Appellants.
M. Jafar Hashmi for Respondents Nos.2 to 4.
Mian Muhammad Bashir for Respondents Nos.5 and 6.
Niaz Ahmad Khan, A.A.‑G.
Date of hearing: 16th February, 1999.
P L D 2000 Lahore 108
Before Ihsan‑ul‑Haq Chaudhry, J
MAJID BUKHARI ‑‑‑ Appellant
Versus
THE STATE ‑‑‑ Respondent
Criminal Appeal No. 100 of 1999, heard on 13th August, 1999.
(a) Precedent‑
‑‑‑ Decision becomes an authority in alike case and the Courts are bound to ‑follow the same so long as it stands unreversed ‑‑‑ Binding effect of such authority, however, would disappear if it was shown that the law was misunderstood or misapplied in that particular case.
Yazoo & M. V.R. Co. v. Adams (180 US 1) and Heisler v. Thomas Colliery Co. (260 US 245) ref.
(b) Interpretation of statutes‑‑‑
Mandatory and directory nature of a provision‑‑‑Use of words "shall" and it'‑m‑'ay %‑‑Effect ‑‑‑ Word "shall" will not always make a particular provision mandatory in nature ‑‑‑ Words "shall" and "may" used in a provision are interchangeable ‑‑‑ Golden rule for determining whether a particular provision is directory or mandatory in nature is to determine the same in the light of the scheme of a particular statute ‑‑‑ Nature and purpose of the provision can be ascertained from the intention of the Legislature.
Abdul Rahim and 2 others v. Messrs United Bank Ltd. of Pakistan PLD 1997 Kar. 62;. Messrs Maple Leaf Cement Factory Ltd. v. The Collector of Central Excise and Sales Tax (Appeal), Lahore and 2 others 1993 MLD 1645 and Muhammad Saleh v. The Chief Settlement Commissioner, Lahore and 2 others PLD 1972 SC 326 ref.
(c) Customs Act (IV of 1969)‑‑‑
‑‑‑‑ Ss. 156(l)(8) & 159(l) ‑‑‑ Appreciation of evidence Prosecution had proved its case against the accused beyond any reasonable doubt ‑‑‑ When Court was convinced of the offence having been committed, procedural lapses specifically made during investigation could be of no legal consequence ‑‑‑ Provisions of S.159 of the Customs Act, 1969 being directory in nature, contention of the counsel of accused that word "shall" having been used in the provision or S. 159(l) of the said Act the same was mandatory in nature violation of which had vitiated the trial, had no merit ‑‑‑ Intention of the Legislature was that the accused if really involved in the case should not escape punishment‑‑‑ Appeal of accused was dismissed accordingly.
S.M. Yousuf and others v. Collector of Customs and others PLD 1968 599; Shaukat Hussain v. Zulfiqar Ahmad, S.H.O., P.S. Mozang and 2 Others 1983 PCr.LJ 676; Muhammad Nadeem v. The State 1989 PCr.LJ 1234; Miss Beatrice Ben v. Government of Pakistan PLD 1989 Lah. 435; Farid Khan v. The State 1993 PCr.LJ 500; Syed Abdul Nabi v. The State PLD 1988 Lah.146; Abdur Rauf Khan v. Collector, Central Excise & Land Customs, Peshawar and 3 others 1980 SCMR 114; State through Deputy Attorney‑General, Peshawar v. Banda Gul and 2 others 1993 SCMR 311; Mehram Ali and others v. Federation of Pakistan and others PLD 1998 SC 1445; State v. Umar Hayat PLD 1992 SC 393; Mir Mazar v. Azim PLD 1993 SC 332; Allah Ditta v. Barkat Ali and 3 others 1992 SCMR 1974; Dr. Zia Suleman Farooqi v. Punjab Public Service Commission and others PLD 1994 Lah. 55; Nazir Ahmad and another v. Muhammad Tahir and another PLD 1992 Lah. 89; Amer Habib v. Senior Superintendent of Police and others 1995 CLC 29; Sultan Mir and 18 others v. Umar Khan and 10 others 1992 SCMR 1206; Noorul Amin and another v. Muhammad Hashim and 27 others 1992 SCMR 1774; Imtiaz Ahmad v. Ghulam Ali and 2 others‑PLD 1963 SC 382; The State v. Sh. Ghulam Nabi PLD 1988 Azad J&K 33; Abdul Rahim and 2 others v. Messrs United Bank Ltd. of Pakistan PLD 1997 Kar. 62; Government of Punjab v. Dr. Ijaz Hassan Qureshi PLD 1985 SC 28; Maj. Shujait Ali v. Mst. Surraya Begum PLD 1978 SC (AJ&K) 118; Muhammad Jamil v. The State PLD 1996 Lah. 190; Government of Sindh v. Abbas Ahmad, Advocate and 2 others 1994 SCMR 923; The Crown v. Nur Alam PLD 1955 Lah. 667; The Crown v. Subhan PLD 1956 BJ 9; Kuruma v. The Queen PLD 1957 PC 32; Radha Kishan v. The State of Uttar Pradesh AIR 1963 SC 822; Mst. Sadan v. The State PLD 1965 BJ 12; Prabhu v. Emperor AIR 1944 PC 73; The Crown v. Mehar Ali PLD 1956 FC 106; M.S.K. Ibrat v. Commander‑in‑Chief, Royal Pakistan Navy PLD 1956 SC 264; Sh. Abdul Majid v. The State PLD 1958 Kar. 86; Abdul Noor alias Nur Meah v. The State PLD 1958 Dacca 145; Din Dayal Sharma v. The State of U.P. AIR 1959 SC 831; H.N. Rishbud and another v. State of Delhi AIR 1955 SC 190; Khalid Mehmood v. The State PLD 1999 Lah. 279; 1998 PCr.LJ 828; 1981 SCMR 1101; PLD 1990 SC 1176; 1992 SCMR 1475; 1994 SCMR 1543; 1995 SCMR 510; Pir Bakhsh v. The Chairman, Allotment Committee and others PLD 1987 SC 145; Lloyd's Bank Ltd. v. Dawson and others (1966 3 All. ER 77); American Jurisprudence 2nd Vol. 20, p.521; Yazoo & M.V.R. Co. v. Adams (180 US 1) and Heisler v. Thomas Colliery Co. (260 US 245); Muhammad Saleh v. The Chief Settlement Commissioner, Lahore and 2 others PLD 1972 SC 326 and Messrs Maple Leaf Cement Factory Ltd. v. The Collector of Central Excise and Sales Tax (Appeal), Lahore and 2 others 1993 MLD 1645 ref.
(d) Words and phrases‑‑‑
‑‑‑‑ Words "may" and "shall "‑‑‑Connotation ‑‑‑ Interchangeability.
M6ssrs Maple Leaf Cement Factory Ltd. v. The Collector of Central Excise and Sales Tax (Appeal), Lahore and 2 others 1993 MLD 1645 Muhammad Saleh v. The Chief Settlement Commissioner, Lahore and 2 others PLD 1972 SC 326 ref.
Syed Iftikhar Hussain Gillani for Appellants.
Kh. Saeed‑uz‑Zafar, Dy. A.‑G. for the State.
Dates of hearing: 12th and 13th August, 1999.
P L D 2000 Lahore 121
Before Karamat Nazir Bhandari, J
Miss SHEHLA SHAH NAWAZ‑‑‑Petitioner
Versus
THE BOARD OF INTERMEDIATE AND SECONDARY
EDUCATION through Chairman, Faisalabad
and 4 others‑‑‑Respondents
Writ Petition No. 10504 of 1996, decided on 25th August, 1999.
(a) Educational institution‑‑‑
‑‑‑‑ Quashing of result of Intermediate Annual Examination and cancellation of certificate issued to the candidate‑‑‑During verification, result of the petitioner was found to be fictitious and forged‑‑‑Show‑cause notice was issued to the candidate‑‑‑Secretary Board being dissatisfied with the reply of the candidate directed her to appear in person before the Chairman of the Board, despite the fact two opportunities for personal appearance were given to the candidate, she had failed to appear without any reason‑‑‑Board proceeded against the candidate and quashed her result of Intermediate Examination and certificate issued was cancelled‑‑‑Validity‑‑‑Candidate did not adopt the minimum procedure of law, decency and respect and did not appear personally, instead she chose to communicate through letters in which no sufficient ground was disclosed for adjournment‑‑‑Requirement of principles of natural justice were fully met in the case‑‑‑Candidate even failed to advert to the incriminating documents muchless repel them‑‑‑Inference was thus clear that petitioner had nothing to say against such material‑‑‑Falsity of result and of the certificate was established‑‑‑Decision of Board being correct same was affirmed by the High Court.
Vice‑Chancellor, University of Punjab and 2 others v. Muhammad Zahur Nasir 1985 SCMR 802; Board of Intermediate and Secondary Education, Sargodha v. Shahid Latif 1990 SCMR 771 and Anisa Rehman's case 1994 SCMR 2232 distinguished.
(b) Educational institution‑‑‑
‑‑‑‑ Cancellation of admission in Medical College‑‑‑Such cancellation was based upon the quashing of the result of candidate of Intermediate Examination‑‑Whether High Court could interfere in favour of the candidate in view of the fact that she had been studying in the Medical College for the last 2/3 years with success‑‑‑Neither in law nor in equity, relief could be provided to the candidate whose hands were sullied with improper conduct and against whom a finding of privy to and being beneficiary of fraud had not only been recorded by the Board but the same was affirmed by High Court, after going through the documents and material placed on record ‑‑‑ High Court declined to interfere in favour of the candidate in circumstances.
Abdul Janan v. University of Peshawar through Vice‑Chancellor and others PLD 1996 SC 709 distinguished.
(c) Prospectus of Government Medical Colleges in Punjab‑‑‑
‑‑‑‑ Para. 19(a)(b)(c) & (d)‑‑‑Admission in Medical College, cancellation of‑‑Admission of candidate was based on the certificate of Board of Intermediate and Secondary Education ‑‑‑ Such admission was provisional and was liable to be recalled at any time, in case of such certificate being false ‑‑‑ Where the certificate of the candidate was found to be false and the same was cancelled the admission of the candidate‑in Medical College was rightly cancelled.
Munawar Ahmad Javed, Ijaz Feroze and Mian Maudood Akbar for Petitioners.
Mohy‑ud‑Din Qazi for Respondents Nos. I and 2.
Dates of hearing: 29th June; 16th and 18th August, 1999.
P L D 2000 Lahore 128
Before Tassaduq Hussain Jilani and Bashir A. Mujahid, JJ
SARDAR MUHAMMAD and 2 others ‑‑‑ Appellants
Versus
THE STATE ‑‑‑ Respondent
Criminal Appeals.Nos.99, 31‑J and Murder Reference No. 115 of‑ .1994, heard on 13th May, 1999.
(a) Penal Code (XLV of 1860)‑‑
‑‑‑‑ S. 302(b)/34 ‑‑‑ Criminal Procedure Code (V of 1898), S. 164 ‑‑‑ Appreciation of evidence ‑‑‑ Motive against the accused was not proved ‑‑‑ Prosecution evidence furnished by the close relatives of the deceased was not corroborated by any independent source ‑‑‑ Retracted' extra‑judicial confession allegedly made by accused before the relations of the deceased did not inspire confidence as no statement under S.164, Cr.P.C. to such effect was recorded before a Magistrate ‑‑‑ Recovery of weapons of offence effected after 5/6 days of the arrest of accused seemed to be fabricated and highly doubtful ‑Prosecution evidence was replete with glaring contradictions, material discrepancies and inconsistencies on all points and was not reliable ‑‑‑ Participation of accused in the occurrence was doubtful who had been involved in the offence due to their relationship with the principal accused ‑‑‑ Accused were acquitted in circumstances.
Muhammad Ashraf alias Kalia v. The State, 1997 MLD 1210 and Munawar Hussian alias Asghar Ali v. The State 1991 SCMR 1601 ref.
(b) Penal Code (XLV of 1860)‑
---S. 302(b)/34 ‑‑‑ Appreciation of evidence ‑‑‑ Acceptance of statement of accused ‑‑‑ Prosecution evidence having been rejected in totality, statement of accused has to be accepted In entirety.
(c) Penal Code (XLV of 1860)...
.... Ss. 302(b) & 302(c) ‑‑‑ Appreciation of evidence ‑‑‑ Inculpatory as well as exculpatory portion of the statement of accused had to be believed while 'convicting him on his admission ‑‑‑ Deceased was not Masoom‑ud‑Dam and he had himself invited the trouble by entering the house of accused at night time for some ulterior purposes and the accused on seeing4the deceased in the room of his sister under "Ghairat" loosing self‑control caused injuries to him‑‑‑"Qatl" committed on account of "Ghairat" being not equivalent to "Qatl‑i‑Amd", ,accused was entitled to concession ‑‑‑ Accused, even otherwise, did not appear to have intended to cause the death of the deceased, but wanted to teach him a lesson for his indecent act and let him go without chasing him ‑‑‑ No inference 'could be drawn either from the weapon of offence, seat or nature of injuries, that accused had any idea of committing culpable homicide amounting to murder‑‑?Accused had acted in exercise of right of defence of honour on account of "Ghairat" and could not be convicted under S.302(b), P. P.C. ‑‑‑Conviction of accused under S.302(b)., P.P.C. was consequently altered to S.302(c), P.P.C. and he was sentenced to undergo 14 years' R.I. with benefit of S.382‑B, Cr.P.C. in circumstances.
Rahim Bakhsh v. Crown PLD 1952 FC 1 and The State v. Muhammad Hanif and others 1992 SCMR 2047 ref.
Rana Maqbool Ahmad Khan for Appellants.
A.H. Masood for the State.
Tufuzul H. Razvi for the Complainant.
Date of hearing : 13th May, 1999.
P L D 2000 Lahore 136
Before Tassaduq Hussain Jilani, J
MAHFOOZ AHMAD ‑‑‑ Petitioner
Versus
ADDITIONAL SESSIONS JUDGE and another ‑‑‑ Respondents
Writ Petitions Nos.6035 and 7792 of 1998, decided on 18th October, 1999.
(a) Penal Code (XLV of 1860)‑‑‑
‑‑‑S. 436/34 ‑‑‑ Criminal Procedure Code (V of 1898), Ss. 173 & 203‑‑Constitution of Pakistan (1973), Art. 199 ‑‑‑ Constitutional petition ‑‑‑ Discharge of accused by Magistrate ‑‑‑ Validity ‑‑‑ Three different Investigating Officers had found the case against the accused to be false and had submitted report to that effect before the Magistrate who having agreed with the report had passed the well reasoned order of discharge ‑‑‑ Police in such circumstances was under no obligation to submit a report under S.173, Cr.P.C. and then pray for the discharge order from the Trial Court ‑‑‑ None of the accused named in the F.I.R. having been found involved in the alleged offence, there was no necessity for forwarding the case to the Trial Court, what to speak of a Special Court constituted under the Suppression of Terrorist Activities (Special Courts) Act, 1975 ‑‑‑ Constitutional petition was dismissed in circumstances.
Syed Azmat Ali Shah and another v, The State and another PLD 1999 Pesh. 39; Azhar Hussain and others v. Government of Punjab and others 1992 PCr.LX2308; Allah‑Diwaya v. The State 1997 PCr.U 571; Sardar Muhammad Tariq and another v. Special Judge of the Court for Suppression of Terrorist Activities,' Rawalpindi Division, Rawalpindi and 2 others 1996 PCr.LJ 58 and Nazir Ahmad v. The State PLD 1987 Lah. 236 ref.
(b) Suppression of Terrorist Activities (Special Courts) Act (XV of 1975)‑‑
‑‑‑‑ S. 5‑Taking of cognizance ‑‑‑ Mere alleged offence would not confer jurisdiction on a Special Court, it is only if during investigation police finds it a case triable by a Special Court and a report is submitted to that effect that the jurisdiction of the said Court would be attracted.
Aftab Gul for Petitioner.
N.A. Shami for Respondent.
Imtiaz Ahmed Kaifi, Asstt. A.‑G., Punjab.
Date of hearing: 13th October, 1999.
P L D 2000 Lahore 143
Before Malik Muhammad Qayyum, J
ALI ASGHAR MALIK and 3 others‑‑Petitioners
Versus
FEDERATION OF PAKISTAN through Secretary, Ministry of Commerce, Prime Minister Secretariat, Islamabad and 9 others ‑‑‑ Respondents
Writ Petitions Nos. 18055 and 18056 of 1999, decided ‑on 8th October, 1999.
(a) Trade Organisations Ordinance (XLV of 1961)‑‑‑
S. 9(2)(d)~‑‑Use of word "may" in S.9(2)(d), Trade Organisations "Ordinance, 1961 ‑‑‑ Connotation ‑‑‑ Use of word "may" I in S.9(2), Trade Organisations Ordinance, 1961, makes the provisions enabling in nature ‑‑‑ Role "of Director, Trade Organisation to supervise or control elections of chambers of commerce ‑‑‑ Scope ‑‑‑ Provisions of S.9, Trade Organisation's Ordinance, 1961, do not, make it obligatory or mandatory on the part of the Director, Trade Organisation to supervise or control the election or to appoint any other person to do so.
(b) Tirade Organisations Ordinance (XLV of 1961)‑‑‑
S. 9(2) ‑‑‑ Matters relating to election ‑‑‑ Jurisdiction of Director, Trade Organisations‑‑Scope ‑‑‑ Jurisdiction of Director, Trade Organisation in such matter starts only once the elections have been held and not earlier.
Mian Ijaz Iqbal and others v, Faisalabad Chamber of Commerce and another PLD 1983 Lah. 1 rel.
(c) Trade Organisations Ordinance (XLV of 1961)‑‑‑
‑‑‑‑ S. 9(2)(e) ‑‑‑ Election ‑‑‑ Jurisdiction of Director, Trade Organisation to annul election ‑‑‑ Scope ‑‑‑ Where the Director is satisfied on his own knowledge and from such investigation as he may think fit or upon report made by an authorised person, the Director may annul the elections, if there have been irregularities in the conduct of election justifying such annulment ‑‑‑ Director, Trade Organisation can order fresh election to be held within such period as may be specified.
(d) Trade Organisations Ordinance (XLV of 1961) ‑‑‑
S. 9‑Constitution of Pakistan (1973), Art.199 ‑‑‑ Constitutional petition‑‑Maintainability ‑‑‑ Elections of Chamber of Conunerce assailed in Constitutional petition ‑‑‑ Validity~ ‑‑‑ Till such time, an order was passed or action was taken by the statutory functionaries of the Federal Government under Trade Organisations Ordinance, 1961, Constitutional petition was not maintainable.
Siddique and another v. Chamber of Commerce and Industries, Karachi and another 1992 MLD 651 rel.
Muhammad Saleem v. Provincial Election Authority, Sindh at Karachi PLD 1985 Kar, 135 distinguished.
(e) Trade Organisations Ordinance (XLV of 1961)‑‑
---S. 9(2)(e) ‑‑‑ Constitution of Pakistan (1973), Art. 199 ‑‑‑ Constitutional petition ‑‑‑ Maintainability ‑‑‑ Adequate remedy, availability of ‑‑‑ Effect‑‑Petitioners challenged elections of Chamber of Commerce before Director, Trade Organisations and without waiting for any reply or action on the part of Director, Trade Organisations they filed Constitutional petition ‑‑‑ Validity‑‑Constitutional petition could not be filed in view of S‑9(2)(e), Trade Organisations Ordinance, 1961 ‑‑‑ Petition was dismissed in limine.
Sadruddin Ansari v. Yar Muhammad Memon and another PLD 1967 Kar. 196; Khadim Hussain and others v. Director, Trade Organisation, Ministry of Commerce, Islamabad and 4 others 1994 CLC 1860 and Messrs Mumtaz Steel Corporation (Pvt.) Ltd. v. Pakistan Steel Rerolling Mills Association PLD 1990 Kar. 335 ref.
A. K. Dogar for Petitioners.
Hamid Khan for Respondents Nos. 3 to 6.
Qamar‑uz‑Zaman for Respondents Nos. 7 to 10.
P L D 2000 Lahore 152
Before M. Javed Buttar, J
ZAHID HUSSAIN ‑‑‑ Petitioner
Versus
THE STATE ‑‑‑ Respondent
Criminal Miscellaneous No.853/13 of 1999, decided on 7th June,, 11999.
Criminal Procedure Code (V of 1898)‑‑‑
---S. 497 ‑‑‑ Prohibition (Enforcement of Hadd) Order (4 of 1979), Art.3/4‑‑Control of Narcotic Substances Act (XXV of 1997), S.9‑A ‑‑‑ Bail ‑‑‑ Control of Narcotic Substances Act, 1997 had already come into existence when the accused was involved in the case. and the same had overriding effect ‑‑‑ Case against the accused, therefore, could not be registered under the provisions of the Prohibition (Enforcement of Hadd) 'Order, 1979 Accused was alleged found in possession of 15 grams of heroin, for which he could be awarded maximum punishment of two years' R.I. under S.9‑A of the Control of Narcotic Substances Act, 1997 ‑‑‑ Case of accused did not fall within the prohibitory clause of S.497(l), Cr.P.C. and his trial was not likely to conclude in near future ‑‑‑ Accused was admitted to bail in circumstances.
Dost Muhammad v. The 5tate 1998 PCr.LJ 11‑1‑7 ref.
Syed Shehzad Jafferi for Petitioner.
Muhammad Ibrahim Farooq for the State.
P L D 2000 Lahore 154
Before Malik Muhammad Qayyum, J
ANSW ENTERPRISES, and 2others ‑‑‑ Petitioners
versus
ASKARI COMMERCIAL BANK LTD., LAHORE ‑‑‑ Respondent
Civil Original Suit No and Civil Miscellaneous No.B‑322 of 1999, decided on 27th October, 1999.
(a) Civil Procedure Code (V of 1908)
‑‑‑‑ S. 12(2) ‑‑‑ Decree, setting aside of ‑‑‑ Decree was passed on the statement of the counsel of the defendant‑ ‑‑Contention raised by defendant was that said counsel did not have any authority to make conceding statement before the Court ‑‑‑ Validity ‑‑‑ Decree could only be set aside under the provisions of S.12(2), C.P.C. . where the same had been procured through fraud or misrepresentation or it was without jurisdiction ‑‑‑ Where no averment was made in the application under S. 12(2), C.P.C. that any fraud had been played by the counsel of the defendant or the plaintiff, the petition was found to be without ‑any force and dismissed.
Mst. Noor Jahan v. Azmat Hussain Farooqi and another 1992 SCMR 876; Umar Bakhsh and 2 others v. Azim Khan and 12 others 1993 SCMR 374 .and Government of Sindh through the Chief Secretary and others v. Khalil Ahmad and others 1994 SCMR 782 distinguished.
Mobile, Eye Service of Pakistan, Karachi v. Director, Social Welfare/Registration Authority, Government of Sindh, Karachi PLD 1992 Kar. 183 and Muhammad Saeed v. Indico Paint Colour and Varnish Co. PLD 1995 Kar. 25 rel.
(b) Counsel and client‑‑
‑‑‑‑ Entering into any compromise by counsel or to concede the claim on behalf of client‑‑Implied authority ‑‑‑ Every lawyer engaged by a party has implied authority to enter into compromise even if no specific power has been conferred upon him ‑‑‑ Only exception in such a case is where a counsel has been specifically instructed not to make a statement on behalf of his client and yet that counsel has proceeded to do so.
Ansar Hassan Rizvi v. Syed Mazahir Hussain Zaidi 1971 SCMR 634; Messrs S.M. Qasim & Co. v. Messrs Sh. Azim‑ud‑Din PLD 1062 Lah. 95 and Kulsoombai and 5 others v. Mst. Shirinbai and 6 others 1989 CLC 234 rel.
S.A. Manan for Petitioners
Zahid Hamid for Respondent
P L D 2000 Lahore 157
Before Syed Zahid Hussain, J
PAKISTAN through Secretary to Government of Pakistan, Ministry of Railways, Islamabad and another ‑‑‑ Appellants
versus
Messrs RAJASTAN ALLOYS AND STEEL (PRIVATE) LIMITED through Aftab Enterprises, Lahore ‑‑‑ Respondent
First Appeal from Order No.5 of 1991, decided on 8th November, 1999., (a) Arbitration Act (X of 1940)‑‑‑
‑‑‑‑ Ss. 14, 15, 16, 17, 30 & 39‑ ‑‑Arbitration proceedings ‑‑‑ Objections to award ‑‑‑ Non‑framing of proper issues by Trial Court and failure to appreciate real controversy between the parties ‑‑‑ Effect ‑‑‑ Objection application was filed against the validity of the award given by arbitrator ‑‑‑ Trial Court rejected that application on the ground of delay ‑‑‑ Validity ‑‑‑ Trial Court failed to appreciate the real controversy and to frame a material issue essential for the just adjudication of the matter and also failed to perform the duty cast upon it under S. 17, Arbitration Act, 1940 ‑‑‑ Objection petition having been unlawfully rejected, order of Trial Court was set aside and case was remanded for decision afresh.
Mst. Sughran Bibi alias Miran Bibi v. Asghar Khan and another 1988 SCMR 4, Pakistan v. QMR Expert Consultant PLD 1990 SC 800; Union of India v. Partap Chandra Biswas AIR 1964 A&N 141; Chhaba Lai v. Kallu Lai and others AIR 1946 PC 72; Messrs Awan Industries Ltd. v. 'Me Executive Engineer, Lined Channel Division and another 1992 SCMR 65 and Muhammad Akbar v. The Province of Punjab 1985 SCMR, 116 ref.
(b) Civil Procedure Code (V of 1908)
--0. XIV, R. I & 0. XX, R.5 ‑‑‑ Framing of issues ‑‑‑ Object ‑‑‑ Decision of Court ‑‑‑ Each material proposition affirmed by one party and controverted by the other forms the subject of a distinct issue ‑‑‑ Where proper issues are framed by the Court, the controversy between the parties is crystallised who then produce evidence in support of their respective pleas ‑‑‑ Parties are required to prove the issues and not the pleadings.
Bakht Zamin v. Said Majeed 1989 SCMR 1719 rel.
Aurangzeb Mirza for Appellants
Malik Muhammad Nawaz for Respondent
Dates of hearing : 11th, 25th October and 8th November, 1999,
P L D 2000 Lahore 162
Before Malik Muhammad Qayyum, J
Messrs SHAH JEWANA TEXTILE MILLS LTD., LAHORE through Representative ‑‑‑ Defendant‑Applicant
versus
UNITED BANK LTD. through Attorneys ‑‑‑ Plaintiff‑Respondent
Review Applications Nos. 1‑B of 1999, 2‑B, 6‑B, 8‑B, 9‑B, 10‑B of 1998 and Civil Miscellaneous No.49‑B of 1995 in Civil Original Suit No.25 of 1990 in Civil Original Suit No.84 of 1998, decided on 25th October, 1999.
(a) Banking Companies (Recovery of Loans, Advances, Credits and Finances) Act (XV of 1997)‑
‑‑‑‑ Ss. 2(b)(i) & 5 ‑‑‑ High Court acting as a Banking Court ‑‑‑ Status ‑‑‑ While hearing cases under the Banking ‑Companies (Recovery of Loans, Advances, Credits and Finances) Act, 1997, High Court acts as a Banking Court and not as the High Court.
Valuegold Ltd. v. United Bank Limited PLD 1999 Kar. 1 and Pakistan Fisheries Limited v. U.B.L. PLD 1993 SC 109 rel.
(b) Review‑
‑‑‑‑ Review, like an appeal, is substantive right and must be specifically conferred by the statute under which the case has arisen and there is no implied power to review vesting in any Court or Authority.
Hussain Bakhsh v. Settlement 'Commissioner, Rawalpindi and others PLD 1970 SC 1; Muhammad Yousaf v. The Government of Pakistan 1992 SCMR 1748; S.A. Rizvi v. Pakistan Atomic Energy Commission and another 1986 SCMR 96.5 and Muhammad Ayub. Butt v. Allied Bank Ltd., Peshawar PLD 1981 SC 359 ref.
(c) Banking Companies (Recovery of Loans, Advances, Credits and Finances) Act (XV of 1997)‑
S. 27 ... Review ‑‑‑ Exercise of power of review. by Banking Court‑‑Validity ‑‑‑ Filing of review petition before Banking Court was specifically barred under S.27, Banking Companies (Recovery of Loam, Advances, Credits and Finances) Act, 1997 ‑‑‑ Banking Court had no jurisdiction to review. its judgments, decrees or orders.
Dr. M. Fazil Zabir v. Mst. Begum Jan PLD 1966 Lah. 53; Muzaffar Ali v. Muhammad Shafii PLD 1981 SC 94; Messrs Middle East Bank Ltd. v. Zubair Ahmad Khan Afghani 1990 MLD 909; Regina ‑v. Bartle and the Commissioner of Police for the Metropolis and others (House of Lords's case); Allied Bank of Pakistan Ltd. v. Shabbir Ahmad 1996 SCMR 1525; Manohar Lal Chopra v. Raj Bahadur Rao Raja Seth Hiralal AIR 1962 SC 527 and T. Krishnappa and another v. H. Lingappa AIR 1982 Kar. 58 ref.
Muhammad Akram Shaikh, Muhammad Aslam and Mrs. Sadia Malik for Applicant.
Syed Ali Zafar, Qaiser Javaid Mian and Haider Zaman Qureshi for Respondents.
Date of hearing; 24th September, 1999.
P L D 2000 Lahore 168
Before Malik Muhammad Qayyum and Jawwad S. Khawaja, JJ
Syed NIZAM ALI and 2 others ‑‑‑ Appellants
versus
GHULAM SHAH through Legal Heirs and another ‑‑‑ Respondents
Regular First Appeal No.95 of 1992 and Civil Miscellaneous No.10‑C of 1998 and No.2,C of 1999, decided on 31st May, 1999.
(a) Power of Attorney Act (VII of 1892)‑
‑‑‑‑ S. 2 ‑‑‑ Power of attorney ‑‑‑ Interpretation ‑‑‑ Contents of power of attorney shall be strictly construed and no power or authorisation should be mad into the same which is not expressly set out therein.
Muhammad Hussain v. Bashir Ahmed PLD 1987 Lah. 392; Haji Mitha Khan v. Mst. Nafees Eegum' and others 1995 CLC 896 and Muhammad Mehrban v. Sadruddin and another 1995 CLC 1541 ref.
(b) Power of Attorney Act (VU of 1892)‑
‑‑‑‑S. 2 ‑‑‑ Power of attorney ‑‑‑ Principal and attorney, relationship of ‑‑‑ Such relationship requires the attorney to act in the best interest of the principal and a power of attorney creates a fiduciary relationship between the two Party dealing with an attorney would, therefore, be imputed, notice of such fiduciary overlay on an attorney's authority.
(c) Civil Procedure Code (V of 1908)‑
‑‑‑S. 12(2) ‑‑‑ Setting aside of decree ‑‑‑ Misrepresentation before Court‑‑Applicant had a vested right in the suit property and during the pendency of lis, applicant was not made party to the same ‑‑‑ Consent decree was obtained by misrepresentation before the Court ‑‑‑ Effect ‑‑‑ Where the applicant had a vested interest in the suit property, application under S.12(2), C.P.C. was maintainable to prevent the applicant from being deprived of his rights in the suit property ‑‑‑ Application was allowed accordingly.
Mian Rafaqat Ali, Advocate.
Taqi Ahmed Khan, Advocate.
P L D 2000 Lahore 172
Before Ali Nawaz Chowhan, J
ARSHAD ALI and 2 others through his brother ‑‑‑ Petitioners
Versus
MUHAMMAD ASHRAF and 2 others ‑‑‑ Respondents
Civil Revision No. 1332 of 1985, heard 9th June, 1999.
(a) Civil Procedure Code (V of 1908)‑‑
---0. XXXII, R.7 ‑‑‑ Agreement or compromise on behalf of minor ‑‑‑ Leave of Court, requirement of ‑‑‑ Purpose ‑‑‑ Imposition of such restriction (requiring leave of the Court) on the powers of next friend or guardian of a minor was meant to protect the interest of the minor in the suit, being adversely affected by a wrongful act or negligence on the part of the next friend or guardian.
(b) Civil Procedure Code (V of 1908)‑‑‑
(c) Civil Procedure Code (V of 1908)‑
‑‑‑‑ 0. XXXII, R.7,'Ss. 115 & 147 ‑‑‑ Agreement on behalf of minors by next friend ‑‑‑ Mother of the minors entered into an agreement with leave of the Court ‑‑‑ No accusation was found against the mother of minors for having done anything adverse to the interests of minors ‑‑‑ Effect ‑‑‑ Where the compromise was allowed with the leave of the Court, in circumstances, the same had become binding on the minors‑until fraud was shown ‑‑‑ Where no adverse effect was found on the rights of the minors and the same were fully protected, there was no reason for the exercise of visitatorial jurisdiction by the High Court ‑‑‑ Revision was dismissed accordingly.
Jaffar Abbas and 2 others v. Ahmad and another PLD 1991 SC 1131; Sheo Nath Saran v. Sukh Lai Singh ILR 27 Cal. 229; Muhammad Mahinud Choudhry v. Behary Lal Saha and others AIR 1930 Cal. 463; Malik Sohrab v. Anokh Rai 18 PR 1891 and NihIa v. Bhagwana and. another AIR 1936 Lah. 234 ref.
Malik Allah Yar for Petitioner.
A.G. Tariq Ch. for Respondents.
Date of hearing: 9th June, 1999.
P L D 2000 Lahore 180
Before Karamat Nazir Bhandari, J
Miss REHANA KAUSAR ‑‑‑ Petitioner
Versus
SECRETARY HEALTH, GOVERNMENT OF PUNJAB and others‑‑‑Respondents
Writ Petition No.3331 of 1998, heard on 11th January, 1999.
Prospectus of Government Medical Colleges in Punjab‑‑‑
‑‑‑‑ P. 52‑‑‑Constitution of Pakistan (1973), Art. 199‑‑‑Constitutional petition‑‑‑Educational institution‑‑‑Candidates admitted in Medical College on special/reserved seat‑‑‑Migration of such candidate to another Medical College‑‑‑Validity‑‑‑Provisions at p. 52 of Prospectus of Government Medical Colleges in Punjab did not allow migration of students admitted against reserved seats on various categories, to other medical colleges‑‑Refusal of the Government to allow migration of the candidate from one medical college to the other was backed by the rule contained in the Prospectus‑‑‑High Court declined interference.
Shahid Hussian Kadri for Petitioner.
Muhammad Amin Lone, Asstt. A.‑G., Punjab for Respondents.
Date of hearing: 11th January, 1999.
P L D 2000 Lahore 181
Before Ihsan‑ul‑Haq Chaudhry, J
ZAMIR AHMAD SHEIKH, EX‑DEPUTY CHIEF CONTROLLER OF
PURCHASE/C.F. PAKISTAN RAILWAYS, LAHORE‑‑‑Petitioner
versus
PAKISTAN RAILWAYS through Central Manager, Pakistan Railways, Lahore and 2 others‑‑‑Respondents
Writ Petition No.9175 of 1999, decided on 22nd June, 1999.
(a) Transfer of Railways Order (P.O. 33 of 1962)‑‑‑
‑‑‑‑Art. 3 [as substituted by Transfer of Railways (Amendment) Ordinance (I of 1998)]‑‑‑Constitution of Pakistan (1973), Art.199‑‑‑Constitutional petition‑‑‑Assumption of office of Chairman Railways ‑‑‑Validity‑‑Management of Railways was to be governed by Board consisting of Chairman and five members to be appointed by Federal Government‑‑Secretary to Government of Pakistan (Railways Division) was to be the ex officio Chairman of the Board and out of members mentioned in cl.(I) of Art.a, respondent was never appointed Member. Board of Directors of Railways‑‑‑On account of lack of such qualification, his assumption of office as Chairman Railways was declared ultra vires of Art.3 of Transfer of Railways Order, 1962.
Muhammad Afzal and others v. Government of Balochistan through Secretary, S&GAD, Quetta and 4 others 1995 PLC (C.S.) 567; Ijaz Hussain v. Abdul Qayyum 1996 PLC (C.S.) 622; Ayyaz Nnjum v. Government of Punjab. Housing and Physical Planning Department through Secretary and others 1997 SCMR 169; Javed Hussain Shah v. Government of Punjab and others 1998 SCMR 220; Sardar Asseff Ahmad Ali v. Muhammad Khan Junejo and others PLD 1986 Lah. 310; Collector of Customs, Karachi and others v. Messrs New Electronics (Pvt.) Ltd. and 59 others PLD 1994 SC 363; Hakim Ali Zardari v. The State and another PLD 1998 SC 1; Riaz Ahmed v. The State 1998 SCMR 1729 and Muhammad Yar Buttar and 4 others v. Board of Governors, Overseas Pakistanis Foundation, Islamabad and others 1999 SCMR 819 ref.
(b) Constitution of Pakistan 1973)‑‑‑
‑‑‑‑Arts. 189 & 264‑‑‑Effect of repeal of Ordinance‑‑‑Orders made and action taken during period when Ordinance was in force would remain intact being saved by Art.264, Constitution of Pakistan (1973).
Hafiz Tariq Nasim for Petitioner.
Sh. Anwarul Haq, Dy. A.‑G. for Respondents.
Date of hearing: .21st June, 1999.
P L D 2000 Lahore 186
Before Ghulam Mahmood Qureshi, J
MUNAWWAR JAMIL‑‑‑Appellant
versus
Mst. NOSHI (NISHAT) GILLANI and 3 others‑‑‑Respondents
First Appeal from Order No. 188 of 1998, heard on 5th April, 1999.
(a) Copyright Ordinance (XXXIV of 1962)‑‑
‑‑‑‑S. 65‑‑‑West Pakistan Civil Courts Ordinance (Il of 1962), Ss. 6(2) & 17(1)‑‑‑Matters relating to copyright‑‑‑Jurisdiction‑‑‑Hearing of any such matter by Additional District Judge‑‑‑Competency‑‑‑District Judge under the provisions of Ss.6(2) & 17(1) of West Pakistan Civil Courts Ordinance, 1962, could assign his functions to an Additional District Judge and as a Principal Civil Court of original jurisdiction Additional District Judge had the same powers in exercise of functions so assigned to him‑‑‑Additional District Judge was competent to adjudicate upon the matter under provisions of Copyright Ordinance, 1962.
Abdul Samad v. Muhammad Ali and another PLD 1977 Lah. 687 ref.
(b) Copyright Ordinance (XXXIV of 1962)‑‑
‑‑‑‑Ss. 60 & 65‑‑‑Civil Procedure Code (V of 1908), O. XXXIX, Rr.l, 2 &' S.151‑‑‑Appeal‑‑‑Grant of interim injunction‑‑‑Suit under provisions of Copyright Ordinance, 1962, was filed by appellant/plaintiff‑‑‑Trial Court refused to grant interim injunction in favour of appellant/plaintiff‑‑Infringement of rights of the appellant/plaintiff was in his (plaintiff's) knowledge and rather the appellant/plaintiff acquiesced in that infringement‑‑‑Book of the respondent/defendant was published earlier in time than that of the appellant/plaintiff‑‑‑Effect‑‑‑Where three essential ingredients which were necessary for grant of interlocutory relief were missing, the order of the Trial Court refusing interim injunction did not suffer from any illegality or infirmity.
Begum Tiwana's case PLD 1967 Lah. 967 ref.
Rana Farman Ali Sabir for Appellant. Faisal Hanif Chaudhry for Respondents.
Date of hearing; 5th April, 1999.
P L D 2000 Lahore 190
Before Syed Zahid Hussain, J
ABDUL WAHID and 8 others‑‑‑Petitioners
Versus
SARDAR ALI and 2 others‑‑‑Respondents
Revision Petition No. 1173 of 1999, heard on 4th August, 1999.
(a) Punjab Pre‑emption Act (IX of 1991)‑‑‑
‑‑‑‑Ss. 24, 27 & 28‑‑‑Civil Procedure Code (V of 1908), 5.115‑‑‑Suit for pre‑emption ‑‑‑Deposit of Zar‑i‑Soem (1/3rd)‑‑‑Plaintiffs had disputed order 'of Trial Court whereby they were directed to deposit amount as Zar‑i‑Soem (1/3rd) of value of property mentioned in the mutation‑‑‑Contentions of the plaintiff were that value of the property as mentioned in column of mutation, was inflated and direction of Trial Court to make deposit of specified amount as Zar‑e‑Soem was unwarranted and illegal and that value as mentioned in respective columns of mutation being not real value of property, Trial Court was obliged to determine probable value of property in terms of second proviso to S.24, Punjab Pre‑emption Act, 1991‑‑‑Validity‑‑‑Fixation of probable value of property was only required when sale price thereof was not mentioned in sale‑deed or in mutation or when it appeared to the Court that same was inflated‑‑‑Order depositing amount as Zar‑i‑Soem was passed by Trial Court in presence of plaintiffs, but they did not raise, at any stage, objection to the effect that price of property was inflated‑‑‑No illegality, in circumstances, had been committed by Trial Court in ordering deposit of 1/3rd of value of property mentioned in mutation‑‑‑Order of Trial Court, therefore, could not be interfered.
Sher Bahadur Khan and another v. Haji Walibat Khan and 7 others 1992 MLD 46; Awal Noor v. District Judge, Karak and 8 others 1992 SCMR 746 and Habibullah Khan v. Amir Zaman and 9 others 1995 SCMR 135 ref.
(b) Punjab Pre‑emption Act (IX of 1991)‑‑‑
‑‑‑‑Ss. 24, 25, 27 & 28‑‑‑Suit for pre‑emption ‑‑‑Deposit of Zar‑i‑Soem (1/3rd)‑‑‑Determination‑‑‑Direction for deposit of 1/3rd of price of property, though was mandatory under S.24(1), Punjab Pre‑emption Act, 1991, but as to real value of property, it was not final and was of tentative nature‑‑Provisions of S.27, Punjab Pre‑emption Act, 1991, had empowered Court to determine market value of the property and criteria for determining market value was laid down in S.28 of the said Act‑‑‑Detailed inquiry as to determination of market value of property was part of trial of suit when parties concerned would get opportunity to prove their respective pleas‑‑Notwithstanding compliance of order under S.24, Punjab Pre‑emption Act, 1991, by plaintiff, it could be proved that market value was different than the one mentioned in the deed or mutation.
Mian Muhammad Qasim for Petitioners.
Kh. Ishtiaq Ahmad for Respondents.
Date of hearing: 4th August, 1999,
P L D 2000 Lahore 195
Before Amir Alam Khan, J
Mst. HALEEMA BIBI and another‑‑‑Petitioners
versus, SAQIB SHAMIM and 3 others‑‑‑Respondent
Civil Revision No.62 of 1999, heard on 5th April, 1999.
(a) Specific Relief Act (I of 1877)‑‑‑
‑‑‑‑S. 54‑‑‑Civil Procedure Code (V of 1908), O.XXXIX, Rr. I & 2‑‑Temporary injunction, grant of‑‑‑General principles‑‑‑Plaintiffs sought temporary injunction for restraining the defendants from selling such portion of land which parties had mutually agreed to give passage to each other‑‑Trial Court refused to grant temporary injunction on the ground that execution of compromise deed having been denied by the defendants/plaintiffs had produced photo copy of compromise which could not be relied upon unless the same was proved by producing original document in evidence and that plaintiffs had in their plaint mentioned about sale‑deed while no such sale‑deed was found on the record and as such plaintiffs had no prima facie case‑‑‑Validity‑‑‑Prior to compromise there were number of criminal and civil cases between the parties which were settled as per compromise, therefore, it could not be said that there was no compromise‑‑‑Defendants in their written statement admitted that some compromise was entered into between the parties but with rider that it was for any exchange of land‑‑‑Such grounds of refusal of temporary injunction could be determined at the trial‑‑‑Plaintiffs had made prima facie case and balance of inconvenience in their favour in circumstances and they were bound to suffer irreparable loss‑‑‑Temporary injunction was granted.
(b) Civil Procedure Code (V of 1908)‑‑‑
‑‑‑‑0. XXXIX, Rr. 1 & 2‑‑‑Temporary injunction, grant of‑‑‑Essentials.
To be entitled to temporary injunction during the pendency of the suit all that was required to disclose a prima facie case, irreparable loss and balance of convenience. At an initial stage, no findings of determinative nature was required to be made on the disputed question of law and fact raised in the suit and all that was required was to keep in the background the facts alleged and disputed in a case and to refer to broad principles of law likely to be applied in resolving them with a view to find out whether there existed a prima facie case. The party to be entitled to injunction should simply disclose that he had an arguable case in his favour.
Mrs. Parveen Begum v. Raja Muhammad Sarwar Khan PLD 1956 (W.P.) Kar. 521; Fry on Specific Performance, 6th Edn., p.538 and Hadley v. The London Bank of Scotland 12 LTR 747 ref.
(c) Specific Relief Act (I of 1877)‑‑‑
‑‑‑‑S. 54‑‑‑Civil Procedure Code (V of 1908), O.XLIII, R.1 read with O.XLI, R.5 & O.XXXIX, Rr. 1 & 2‑‑‑Temporary injunction‑‑‑Appellant sought temporary injunction for restraining defendants from selling such portion of land which parties had mutually agreed through agreement by which they had to give passage to each other‑‑‑Appellate Court refused to grant temporary injunction on the ground that the agreement itself was shorn of details as to the length and width of strip of such land‑‑‑Such question being germane to main controversy, application for issuance of temporary injunction could not be dismissed on that ground as appellants had yet to prove their case at the trial‑‑‑While issuing temporary injunction, difference between final proof and prima facie case should be kept in mind‑‑‑Appellants were, held, to be entitled to grant of temporary injunction in circumstances.
Ch. Ikram‑ul‑Haq Naseem for Petitioners. Mian Javed Ahmad for Respondent No. 1. Nemo for Respondents Nos. 2 to 4.
Date of hearing: 5th April, 1999.
P L D 2000 Lahore 202
Before Tanvir Ahmad Khan, J
PUNJAB PHARMACY EDUCATION FOUNDATION, LAHORE through Chairman‑‑‑Petitioner
versus
SECRETARY HEALTH, GOVERNMENT OF PAKISTAN, ISLAMABAD and 2 others‑‑‑Respondents
Writ Petition N.o.22602 of 1996, heard on 31st May, 1999.
Pharmacy Act (XI of 1967)‑
‑‑‑‑Ss. 18 & 19‑‑‑Constitution of Pakistan (1973), Art.199‑‑‑Constitutional petition‑‑‑Affiliation of educational institution‑‑‑Petitioner institution had taken exception to order of Authority whereby its application for affiliation with Central Pharmacy Council of Pakistan was rejected‑‑‑Inquiry Committee comprising of senior officers visited place of petitioner, but nothing was found there‑‑‑Neither there was arty laboratory nor other requirements envisaged under law‑‑‑Petitioner before satisfying requirements of affiliation conveyed impression to the general public that petitioner had already been affiliated with Central Pharmacy Council of Pakistan and by so doing the petitioner had succeeded in charging colossal amount by deceiving students and their parents‑‑‑Such act of petitioner had misled general public and a criminal case was also registered against the petitioner‑‑‑Petitioner who not only had failed to make out a case on merits, had also not approached the Court with clean hands‑‑‑High Court declined to exercise its discretion in favour of petitioner in circumstances.
Rahimyar Khan College of Education through Principal and another v. Islamia University of Bahawalpur through Vice‑Chancellor and 3 others 1996 SCMR 341; 1996 CLC 64; AIR 1993 SC 2178; St. Xaviers Co11egc v. State of Gujarat (1975) 1 SCR 173; AIR 1974 SC 1389; Federation of Pakistan v. Saeed Ahmad PLD 1974 SC 151; Nawab Syed Raunaq Ali and others v. Chief Settlement Commissioner and others PLD 1973 SC 236 and Messrs Airport Support Services v. The Airport Manager, Quaid‑e‑Azam International Airport, Karachi and others 1998 SCMR 2268 ref.
Mian Sarfrazul Hassan for Petitioner.
Sh. Anwar‑ul‑Haq, Dy.A.‑G. and Fauzi Zafar, Asstt. A.‑G. for Respondents.
Date of hearing: 31st May, 1999.
P L D 2000 Lahore 208
Before Riaz Kayani and Khawaja Muhammad Sharif, JJ
SAEED AHMAD and others‑‑‑Appellants
versus
NASEER AHMAD and others‑‑‑Respondents
Intra‑Court Appeal No.973 of 1999, decided on 23rd November, 1999.
(a) Criminal Procedure Code (V of 1898)‑‑
‑‑‑‑S. 154‑‑‑First information Report‑‑‑Reducing the information in writing by police at the instance of the informant regarding a cognizable offence is imperative in law‑‑‑Principles‑‑‑Police Officer need not first give a hearing to the accused named in the complaint before recording the F.I.R.‑‑‑Refusal of Station House Officer of Police Station or other Police Officer acting under his direction, can either be brought to the notice of the higher echelons in the police hierarchy or can be agitated through the instrument of writ.
If there is an information relating to the commission of a cognizable offence, it falls under section 154 of the Code of Criminal Procedure and a police officer is under a statutory obligation to enter it in the prescribed register. The condition precedent is simply two‑fold; first, it must be an information and secondly. it must relate to a cognizable offence on the face of it and not merely in the light of subsequent events. A police officer is hound to receive a complaint when it is preferred to him or where the commission of an offence is reported to him orally, he is bound to take down the complaint. If he does not incorporate in the register a complaint so made. he fails to perform a statutory duty as a public servant and. therefore, renders himself to be dealt with by his superior officers for neglect of duty. Thus, it does not depend on the sweet will of a police officer who may or may not record it.
Once an information regarding commission of a cognizable offence. is given to a police officer‑in‑charge of a police station he is bound to reduce the same to writing and substance thereof has to be entered in a book to be kept by such officer in such form as the Provincial Government may prescribe in this behalf. Reducing the information in writing at the instance of the informant regarding a cognizable offence is an imperative in law about which there is no cavil .
There is no requirement at the time of registration of the case to give a hearing to the accused named in the complaint. However, soon thereafter, once the case is registered the Investigating Officer, while gathering evidence confronts the accused with the same and records their version which ultimately goes for adjudication before a Court of law where, undoubtedly, those complained against are given full and absolute hearing.
Refusal of the S.H.O. or any other police officer acting under his direction, can either be brought to the notice of the higher echelons in the police hierarchy or can be agitated through the instrument of writ.
M. Anwar, Barrister‑at‑Law v. The Station House Officer, Civil Lines Police Station, Lahore and others PLD 1972 Lah. 493 fol.
(b) Criminal Procedure Code (V of 1898)‑‑‑
‑‑‑‑S. 154‑‑‑Constitution of Pakistan (1973), Art. 199‑‑‑First Information Report‑‑‑Constitutional petition seeking order from High Court for registration of case‑‑‑High Court was not required to hear the accused/respondent in the petition even if they were present at the time of hearing of the Constitutional petition to the limited extent of directing the Authorities to register a case‑‑‑Principles.
Writ petition filed for seeking of order from High Court for registration of case is to remind the Station House Officer of his obligation under the law, which he has failed to perform. It is not essential at such an interim stage to call the accused/respondents and also give then: hearing before issuing a direction to the Station House Officer for registration of the case. When the Station House Officer is prepared to do his duty under section 154, Cr.P.C. he is not bound by any provision of law to first provide an opportunity to the accused and thereafter, if he is satisfied that they have no explanation to offer, only then he is to register a case. The moment the Station House Officer receives an information about the commission of a cognizable offence he shall reduce it in writing and shall proceed in accordance with law. If providing of an opportunity to the accused to be heard is not necessary under the law at the time of registration of the case, position would not be changed if a recalcitrant police officer is complained against to the High Court for not doing his duty under the law. There is no such mandate because the position remains the same; in one case by doing his duty the police officer is bound to get a case registered in case an information of cognizable offence is laid before him and in the second case when he refuses, he is directed by the High Court in the exercise of Constitutional jurisdiction to perform his duty. Registration of a case involving cognizable offence is not the be‑all and end‑all of the matter. The Police Officer investigates the information given to him and if he finds grounds connecting the accused, against whom information is given, to be proceeded against, it is only then that he is called to explain the situation and upon failure to do so takes them in custody and proceeds further. The order directing the police officer to get the case registered which he has earlier refused to do so, is of an interim nature in which participation of the accused is not the mandate of law for the reason that once a case is registered, it culminates into a full?fledged inquiry in which undoubtedly the accused have full chance to present their version. No rights of the accused stand trampled at the time of registration of the case and mere registration does not cause stigma. It is only after conviction that stigmatization commences. If the information is found false, those who have been put to hassles inquiry i.e. the accused, can invoke provisions of section 182, P.P.C. or bring an action in law for damages.
Prior hearing if considered essential before the registration of the case would amount to placing the cart before the horse. High Court while considering the matter whether direction should be issued to the police for registration of case against the persons complained, if embarks on an inquiry whether the offence was, or was not committed by the accused, would be transgressing its jurisdiction and would be travelling in tote realm meant for others to probe.
It was not a requirement of law or natural justice to hear the respondents, even if they were present at the time of hearing of the writ petition, to the limited extent of directing the authorities to register a case.
M. Anwar, Barrister‑at‑Law v. The Station House Officer, Civil Lines Police Station, Lahore and others PLD 1972 Lah. 493; Syed Muhammad Ali Shah Bukhari v. Chief Administrator of Auqaf, Punjab, Lahore and others PLD 1972 Lah. 416; Khushi Muhammad v. Commissioner, Multan Division PLD 1965 Lah. 250; Abul A'la Maudoodi v. Government of West Pakistan PLD 1964 SC 673 and Judicial Review of Administrative Action by S.A. de Smith ref.
Sardar Muhammad Latif Khan Khosa, Advocate.
P L D 2000 Lahore 216
Before Iftikhar Hussain Chaudhry
and Zafar Pasha Chaudhry, JJ
ALTAF HUSSAIN and 4 others‑‑‑Appellants
versus
THE STATE‑‑‑Respondent
Criminal Appeal No. 198 of 1995, heard on 13th September, 1999.
(a) Words and phrases‑‑‑
‑‑‑‑"Opinion"‑‑‑Connotation.
Opinion means a view, judgment or appraisal formed in the mind about a particular matter, a brief stronger than impression and less strong than positive knowledge; a generally held view; a formal expression of judgment or advice by an expert, opinion is synonymous with view, belief, conviction, persuasion, sentiment.
Webster's Dictionary ref..
(b) Penal Code (XLV of 1860)‑‑‑
‑‑‑‑Ss. 302(b), 324, 440, 148 & 149‑‑‑Criminal Procedure Code (V of 1898), 5.173‑‑‑Appreciation of evidence‑‑‑Police report ‑‑‑Investigatory evidence‑Ipse dixit opinion‑‑‑Concept‑‑‑Credence‑‑‑Principles‑‑‑Opinion which is ipse dixit only, is not given any credence or weight in judicial proceedings, particularly in a criminal trial‑‑‑Opinion which qualifies to be almost a statement of fact enjoys a measure of respectability and is relevant to the decision of the controversy‑‑‑When, however, the opinion is given which is unbiased, non‑partisan and impartial, it would be right to reject same by terming that as a mere word of mouth of an individual.
Opinion means a view, judgment, or appraisal formed in the mind about a particular matter, a belief stronger than impression and less strong than positive knowledge; a generally held view; a formal expression of judgment or advice by an expert, opinion is synonymous with view, belief, conviction, persuasion, sentiment.
Ipse dixit means "he himself said it"; an assertion made but not proved. In Latin "ipse" means self, ipse dixit implies (of a master or teacher) "the master i.e. Pythagorus) has said it". lpse dixit is, thus, an opinion which is not based on any syllogism, analytical data or reasoning but is a banal, in animate personal opinion or, a mere word of mouth or a borrowed view based on the opinion of another. A word of mouth of a witness hardly finds favour in any judicial or quasi judicial proceedings. Opinion is not only a simple word of mouth but also is a term of wider connotation. In judicial proceedings evidence of various genre is led or brought on record keeping in view the nature of controversy. There is direct evidence of witnesses of fact and there is evidence proffered by witnesses who are professionals, experts and in criminal trials particularly, public functionaries, as well. This evidence is not only relevant but is admissible as well. The evidence of experts, professionals or academiciants is generally in the form of an opinion. This as a matter of fact, is a departure from the general rule that a witness cannot be. asked his opinion upon a particular question, for the witness is required to speak of facts alone which are in his knowledge. But where matters of skill, expertise or professional knowledge are involved the witness might be asked for his opinion and the opinion given would be evidence in the case. For example, a medical officer is often required in a criminal trial to give his opinion regarding the cause of death. the mode of death, the type of weapon employed or the distance from which it was fired and opinion given if supported by necessary data, would be accepted almost as a statement of fact though opinion in such a case was an inference made or a conclusion drawn by the witness from the facts known to him. The opinion of a public functionary such as an Investigating Officer who has had deep association with the matter occupies the same position. Thus, while opinion which is ipse dixit only, is never given any credence or weight in judicial proceedings, particularly a criminal trial, an opinion which qualifies to be almost a statement of fact enjoys a measure of respectability and is relevant to the decision of the controversy.
Investigatory evidence is an important constituent of a criminal case. The Station House Officer or Investigating Officer is generally the first public functionary who comes to know of commission of a crime. He reaches the scene of crime, starts investigation, collects physical, circumstantial and direct evidence about the crime and of the basis of material collected, he forms opinion about the guilt or innocence of the accused which is incorporated in final report under section 173, Cr.P.C. The Investigating Officer, because of pivotal role played by him in the investigation and the peculiar nature of duties discharged, becomes repository of many truths, half‑truths and falsehoods about the case. He has direct knowledge of several relevant facts such as the scene of crime, the environment of locus delicti, the persons who were present or could have been around the place of occurrence at the fateful moments etc. The Investigating Officer is not a provider of opinion alone. The final report prepared by him which provides a staging ground for launching criminal prosecution of the accused in a case, is essentially based on the opinion or judgment of the investigating officer. The opinion of the investigating officer which is backed by supportive data, and qualifies, as observed above, like expert opinion, to be almost a statement of fact, can be given and should be given deference in appropriate cases. Such an opinion may not provide a legal basis for conviction of an accused in a criminal case but it can create a small dent, a minor crack or a yawning gap in the prosecution case, depending on, and proportionate to weight of material behind it and due benefit of the same can also be extended to the accused. By tradition (and also by training), police officers are ruthless prosecutors and all their efforts are directed towards success of the prosecution case once the same is set up in certain terms. Giving of concession to accused is against the very nature of the traditional Investigating Officer and when one is forthcot6ing, and the giver of such opinion is also unbiased, non‑partisan and impartial it would not be right to reject it by terming it as a mere word of mouth of an individual.
(c) Criminal Procedure Code (V of 1898)‑
‑‑‑‑S. 173‑‑‑Police report ‑‑‑Investigatory evidence ‑‑‑Ipse dixit opinion‑‑Concept‑‑‑Credence‑‑‑Principles.
(d) Penal Code (XLV of 1860)‑‑
‑‑‑‑Ss. 392(b), 324; 440, 148 & 149‑‑‑Criminal Procedure Code (V of 1898), S.154‑‑‑Appreciation of evidence‑‑‑Delay in lodging of First ~ Information Report ‑‑‑F.I.R. had not been recorded till the post‑mortem examination of the body of deceased was carried out‑‑‑Trial Court had found that matter was reported to police officer after "due manipulations, consultations and deliberations"‑‑‑F.I.R., in such circumstances, could not be considered to be the "first" or prompt documentation of the incident and became suspect from the outset.
(e) Penal Code (XLV of 1860)‑
‑‑‑‑Ss. 302(b), 324, 440, 148 & 149‑‑‑Appreciation of evidence‑‑‑Credence of witness‑‑‑Factors to be kept in view‑‑‑Injury on the person of witness‑‑Effect‑‑‑Principles and guidelines for assessment of evidence stated.
Believability and acceptability of a witness depends on numerous factors, being injured is just one of them. The injury on the person of a witness does not transform his nature, or his attitude, or mentality. This would make him more vindictive. The injury primarily proves one fact only, and that is, that he was present at the scene of crime but it by no stretch of imagination, proves him to be right or truthful. Where a witness is biased, and inimical towards the opposite‑party his testimony has to be scrutinized with care and corroboration of prosecution case in all of its material aspects is required. The principles and guidelines for assessment of evidence were that different constituent factors of prosecution case must support each other and no single factor would suffice for recording conviction unless the same was corroborated in material respects by other constituent factors or elements. In serious cases entailing harsh sentences a single factor, in itself, would provide too narrow a foundation to base conviction of an accused. Evidence of witnesses of fact, who were injured in the incident, is just one factor or facet of prosecution case. Viewed in isolation, it might give impression of a plausible story to an untrained mind, but examined in a proper ambience, its seamy side would become palpable immediately.
Jahangir Hayat v. The State PLD 1999 Lah. 285 ref.
(f) Penal Code (XLV of 1860)‑‑
‑‑‑‑Ss. 302(b), 324, 440, 148 & 149‑‑‑Appreciation of evidence‑‑‑Benefit. of doubt‑‑‑Extension to accused persons‑‑‑Enmity between the parties was substantiated from record‑‑‑Testimony of witnesses was too mechanical and insipid to inspire confidence‑‑‑Complainant involved a large number of persons as accused in the case without the slightest qualm‑‑‑Except word of mouth of witnesses no other credible evidence existed which could put the noose around the necks of the accused persons‑‑No other circumstances or the attending circumstances corroborated the venomous testimony of inimical witnesses‑‑‑Witnesses tried to improve upon the prosecution case‑‑‑Nothing incriminating was recovered from the locus delicti or from the accused persons which connected them with the commission of offence and their case was not distinguishable on facts or the law from that of acquitted accused whose acquittal had not been assailed by the complainant‑‑‑Appraisal of evidence revealed that offence was committed by the accused persons as concluded by the Investigating Agency and remaining accused were sucked into the case by complainant on account of vendetta and enmity‑‑‑Trial Court had observed that it was undisputed tendency in the area where the occurrence had taken place that the net is thrown in a wider manner to involve the maximum number of the accused family so that none is left behind to feed the female and the minors and in that way agonize the adversaries‑‑‑Convicted accused, in circumstances, deserved the benefit of such observations of the Trial Court like the acquitted companions‑‑Prosecution case against the convicted accused having not been established and offence having been committed by persons other than the convicted accused, who were falsely involved in the case by the complainant due to enmity, their conviction and sentence was set aside by High Court in appeal.
1998 SCMR 32; 1997 SCMR 89; 1993 SCMR 544 and 1992 SCMR 2055 ref.
Raja Muhammad Anwar and Rana M. Arshad for Appellants.
Yasmin Sehgal, Asstt. A.‑G. with A.H. Masood for the State.
Sardar Muhammad Latif Khan Khosa for the Complainant.
Date of hearing: 13th September, 1999.
P L D 2000 Lahore 232
Before Ihsan‑ul‑Haq Chaudhry and Muhammad Zafar Yasin, JJ
Messrs COOPERATIVE HOUSE BUILDING SOCIETY LIMITED, LAHORE through Secretary‑‑‑Appellant
versus
Messrs TRUST LEASING CORPORATION LIMITED through Chief‑ Executive and 4 others‑‑‑Respondents
First Appeal from Order No.280 of 1999, heard on 23rd December, 1999.
(a) Civil Procedure Code (V of 1908)‑‑‑
‑‑‑‑0. XXI, Rr.57, 58, 62, O.XLIII, R.1 & S.151‑‑‑Objections to attachment of property‑‑‑Dismissal of objections by Executing Court‑‑Objections were filed by the appellant, a Cooperative Society‑‑‑Registrar of the Cooperative Societies in a detailed survey had found the appellant Society to be fake and bogus‑‑‑Executing Court dismissed objection petition on the ground that same were filed to defeat the decree passed in a s»it for recover of loan‑‑‑Validity‑‑‑Appellant had sufficient time at its disposal to rebut the findings of the Registrar, Cooperative Societies, if there was a grain of truth in the objection petition‑‑‑Failure of appellant prima facie proved that application was mala fide and its purpose was to defeat the decree‑‑Executing Court, had rightly, dismissed application and appellant failed to make out a case for interference in appeal by High Court‑‑‑Appeal was dismissed in circumstances.
(b) Civil Procedure Code (V of 1908)‑‑‑
‑‑‑‑0. XLIII, Rr. 1 & 3‑‑‑Appeal against order‑‑‑Failure to serve notice‑‑Effect‑‑‑Where notices as required under O.XLIII, R.3, C.P.C. were not served, appeal was not competent.
Kh. Mukhtar Ahmad Butt and Fawad Jamil Qureshi for Appellant.
Zahid Malik for Respondent No. 1.
Nemo for the Remaining Respondents (proceeded ex parte).
Date of hearing: 23rd December, 1999.
P L D 2000 Lahore 236
Before Maulvi Anwar‑ul‑Haq, J
ALTAF HUSSAIN SHAH‑‑‑Petitioner
versus
Mst. AZRA BIBI and 2 others‑‑‑Respondents
Writ Petitions Nos. 1618 and 1619 of 1999, heard on 18th October, 1999.
(a) West Pakistan Family Courts Act (XXXV of 1964)‑‑
‑‑‑‑S. 23‑‑‑Qanun‑e‑Shahadat (10 of 1984), Art.85‑‑‑Constitution of Pakistan (1973), Art. 199‑‑‑Constitutional petition ‑‑‑Nikahnama as evidence of transfer of property in lieu of dower‑‑‑Validity‑‑‑Transfer of property in lieu of dower made at the time of 'Nikah' took effect as a gift ‑‑‑Nikahnama being a public document was admissible in evidence per se as evidence of the transfer of property in lieu of dower‑‑‑No misreading or non‑reading of evidence by both the Courts below while recording their respective judgments was found‑‑‑Constitutional petition was , dismissed in circumstances.
Mst. Zubaida Bibi and others v. Mst. Majidan and another 1994 SCMR 1978 fol.
Umar Bakhsh v. Mst. Zamrut Jan and 9 others PLD 1973 Pesh. 63; Abdul Ghaffar and 6 others v. Ghulam Jan and another PLD 1975 Pesh. 12 and Haji Ghulam Hussain v. Mst. Amir Khatun PLD 1976 BJ 37 ref.
(b) Muhammadan Law‑‑‑
‑‑‑‑ Gift‑‑‑Transfer of property in lieu of dower made at the time of Nikah takes effect as a gift.
Zafar Iqbal Khan for Petitioner.
Nemo for Respondent.
Date of hearing: 18th October, 1999.
P L D 2000 Lahore 239
Before Tassaduq Hussain, Jilani, J
Messrs SHEIKH SPINNING MILLS LIMITED‑‑‑Petitioner
versus
WAPDA and others‑‑‑Respondents.
Writ Petition No.23077 of 1997, decided on 17th December, 1999.
Electricity Act (IX of 1910)‑‑
‑‑‑‑Ss. 26‑A, 39‑A & 48‑‑‑Penal Code (XLV of 1860), S.379‑‑‑Constitution of Pakistan (1973), Art.199‑‑‑Theft of electricity and tempering of electric meter‑‑‑Registration of criminal case and issuance of show‑cause notice‑‑ Constitutional petition‑‑‑Competency‑‑‑Team of Authority headed by Resident Magistrate raided petitioner's mill and found electric meter of petitioner tempered with‑‑‑On report of raiding party a criminal case‑was registered against petitioner, electric connection was disconnected and electric meter was removed‑‑‑Petitioner challenged said action of Authority before Electric Inspector, but without waiting decision of Electric Inspector, he filed Constitutional petition in which action of Authority was challenged‑‑‑Competency of Constitutional petition‑‑‑Petitioner having himself chosen a forum i.e. Electric Inspector for redressal of his grievance he should have pursued remedy available to him under law before Electric Inspector‑‑‑No case for interference in Constitutional jurisdiction of High Court had been made out in fact and circumstances of case‑‑‑Even if petitioner was acquitted by Criminal Court under 5.249‑A, Cr.P.C. said judgment of Criminal Court would not‑affect action taken by Authority on report of raiding party.
Chairman, WAPDA and 2 others v. Advisory Board, Punjab. Lahore and 2 others 1987 CLC 1503; Water and Power Development Authority and others v. Mian Muhammad Riaz and another PLD 1995 Lah. 56 and Khalid Pervaiz v. Water and Power Development Authority through Chairman, WAPDA and another 1999 CLC 1591 ref.
Syed Mansoor Ali Shah for Petitioner.
Muhammad Ilyas Khan for Respondent No. 1.
Date of hearing: 7th December, 1999.
P L D 2000 Lahore 244
Before Malik Muhammad Qayyum and Ghulam Mahmood Qureshi, JJ
Brig. SAHIBDAD KHAN‑‑‑Petitioner
Versus
SECRETARY, COLONIES, BOARD OF REVENUE, GOVERNMENT OF THE PUNJAB, LAHORE
and 5 others‑‑‑Respondents
Writ Petitions Nos.6354 of 1994 and 20045 of 1998, heard on 1st November, 1999.
(a) Practice and procedure‑‑
‑‑‑‑Failure to comply with direction given by High Court‑‑‑Reason for such failure was declaration of law by Supreme Court in a subsequent matter‑‑Validity‑‑‑Where the judgment of High Court was not challenged any further, both the parties were bound to act in accordance with the same‑‑Declaration of law by Supreme Court in a subsequent matter did not have the effect of wiping away the effect of the judgment of High Court which was not subject‑matter of the appeal before Supreme Court.
Pir Bakhsh v. The Chairman, Allotment Committee and others PLD 1987 SC 145 rel.
(b) Colonization of .Government Lands (Punjab) Act (V of 1912)‑
‑‑‑‑S. 10(2)‑‑‑Constitution of Pakistan (1973), Art.199‑‑‑Constitutional petition‑‑‑Termination of tenancy‑‑‑Predecessor of petitioners was granted lease of Government land for a period of ten years and the same was renewed thrice‑‑‑Lease of the disputed land was made in favour of lessee and the same was not renewed in favour of the petitioners or their predecessor who died after the expiry of the lease of the disputed land‑‑‑Validity‑‑‑Where the tenancy was not heritable the petitioners had neither any right to remain in possession of that land nor they could insist that the lease in favour of their predecessor be granted to them‑‑‑Petitioners filed a civil suit on the same subject‑matter without disclosing the fact of pendency of Constitutional petitions before High Court‑‑‑Effect‑‑‑Conduct of the petitioners disentitled them to the grant of any relief in the exercise of discretionary jurisdiction of High Court‑‑‑Petition was dismissed in circumstances.
Mst. Zainab Khatoon v. Member (Colonies), Board of Revenue, Punjab and others 1998 SCMR 118.8; Sub. Muhammad Asghar v. Mst. Safia Begum PLD 1976 SC 435; Nawab Syed Raunaq Ali and others v. Chief Settlement Commissioner and others PLD 1973 SC 236; Rana Muhammad Arshad v. Additional Commissioner (Revenue), Multan Division and others 1998 SCMR 1462 and S. Mumtaz Ahmad Khan v. Peshawar Development Authority and another 1998 SCMR 2745 ref.
Sahibzada Anwar Hamid for Petitioner.
Sher Zaman, Dy. A.‑G. for Respondents Nos. 1 and 5.
Naveed Rasool Ivfirza for Respondent No. 6.
Date of hearing: 1st November, 1999.
P L D 2000 Lahore 251
Before Malik Muhammad Qayyum and Ghulam Mahmood Qureshi, JJ.
M. D. TAHIR, ADVOCATE‑‑‑Petitioner
Versus
FEDERAL GOVERNMENT through Secretary, Cabinet Division, Pakistan Secretariat, Islamabad and 2 others‑‑‑Respondents
Writ Petition No.6899 of 1998, decided on 10th November, 1999.
(a) Constitution of Pakistan (1973)‑‑ .
‑‑‑‑Art. 4‑‑‑Right of citizens to be dealt with in accordance with law‑‑Executive orders‑‑‑Scope‑‑‑Every executive action must be backed by some law‑‑‑Provisions of Art.4 of the Constitution ordain that every person has a right to insist that he be dealt with in accordance with law and law alone.
Haji Ghulam Zamin and another v. A.B. Khokhar and others PLD 1965 Dacca 156 and Khalid Malik v. Federation of Pakistan PLD 1991 Kar. 1 ref.
(b) Constitution of Pakistan (1973)‑‑‑
‑‑‑‑Art. 199‑‑‑Constitutional petition‑‑‑Formation and constitution of "Khidmat Committees"‑‑‑Khidimat Committees were formed in exercise of executive powers through a Notification‑‑‑Validity‑‑‑No source of power was mentioned in the Notification setting up such committees‑‑‑Members of "Khidmat Committees" were given wide and sweeping powers and they could interfere in the functioning and affairs of the Government and its offices‑‑‑Parallel system of administration was not envisaged by the Constitution nor the same could be set up‑‑‑Where local councils comprising of elected representatives of people were already functioning, the rationale in setting up such committees was not understandable‑‑‑Establishment of "Khidmat Committees" therefore; was illegal.
Petitioner in person.
Sher Zaman Khan, Dy. A.‑G. with Ghulam Haider Al‑Ghazali, Addl. A.G., Punjab for Respondents.
Date of hearing: 2nd November, 1999.
P L D 2000 Lahore 253
Before Tassaduq Hussain Jilani, J
Messrs VULCAN CO. (PVT.) LTD. ‑‑‑Petitioner
Versus
COLLECTOR CUSTOMS‑‑‑Respondent
Writ Petition No. 1734 of 1973, decided on 6th December, 1999.
(a) Sea Customs Act (VIII of 1878)‑‑‑
‑‑‑‑Ss. 167(8)(b) & 39‑‑‑If the custom duty or charge payable is not paid or has been erroneously refunded, the same has to be paid by the person so charged, on demand being made within three years of the relevant date‑‑Such rule, however, does not relate to the imposition of fine under S.167(8)(b) of Sea Customs Act, 1878.
(b) Sea Customs Act (VIII of 1878)‑‑‑
‑‑‑‑S. 167(8)(b)‑‑‑Goods imported in excess of the authorization stipulated in the import licence, would be unauthorised and importer of such goods would be liable to be proceeded against under S.167(8)(b), Sea Customs Act, 1878.
(c) Sea Customs Act (VIII of 1878)‑‑‑
‑‑‑‑Ss. 39 & 167‑‑‑Provision of S.39, Sea Customs Act, 1878 is confined to the customs duty and other charges and not to the imposition of fine under 5.167 of the said Act.
(d) Sea Customs Act (VIII of 1878)‑‑‑
‑‑‑‑S. 39‑‑‑Expression "relevant date" means the date when it comes to the notice of the Authorities that duties and tax have been evaded through misrepresentation.
(e) Constitution of Pakistan (1973)‑‑‑
‑‑‑‑Art. 199‑‑‑Constitutional petition‑‑‑Petitioner being in the equitable jurisdiction of the Court must demonstrate equity before he seeks any relief‑‑‑Constitutional jurisdiction of High Court cannot be used to perpetuate an ill‑gotten gain to which petitioner was not entitled at the relevant time.
Nawab Syed Raunaq Ali and others v. Chief Settlement Commissioner and others PLD 1973. SC 236 and Muhammad Baran and others v. Member (Settlement and Rehabilitation), Board of Revenue, Punjab and others PLD 1991 SC 691 ref.
(f) Locus poenitentiae, principle of‑‑‑--
‑‑‑‑Order once passed, cannot be recalled if certain rights have been subsequently created in favour of a person‑‑‑Principle of locus poenitentiae cannot be stretched to protect orders and actions in derogation of law which have caused injustice on the face of the record.
(g) Sea Customs Act (VIII of 1878)‑‑‑
‑‑‑‑S. 167(8)(b)‑‑‑Locus poenitentiae, principle of‑‑‑Application‑‑‑Customs duty to which the importer was liable to pay, by inadvertence, was neither charged nor paid‑‑‑Importer could be burdened with fine not exceeding five times of the value of the goods as mandated under S.167(8)(b) of the Sea Customs Act, 1878‑‑‑Principle of locus poenitentiae was not applicable since the principle could not be stretched to protect orders and actions in derogation of law which had caused injustice on the face of record.
Engineer‑in‑Chief Branch through Ministry of Defence, Rawalpindi and another v. Jalaluddin PLD 1992 SC 207 ref.
Zia Ullah for Petitioner, Izhar‑ul‑Haq for Respondents
Dates of hearing: 29th November and 1st December, 1999
P L D 2000 Lahore 262
Before Muhammad Naseem Chaudhry, J.
MUHAMMAD SULEMAN‑‑‑Petitioner
Versus
ADDITIONAL DEPUTY COMMISSIONER (GENERAL), LAHORE CANTT.‑‑‑Respondent
Writ Petition No. 12959 of 1998, decided on 16th November, 1999.
(a) West Pakistan Land Revenue Act (XVH of 1967)‑‑‑
‑‑‑‑S. 42‑‑‑Mutation, sanctioning of‑‑‑Duties of Circle Revenue Officer‑‑Allocation of functions of Circle Revenue Officer to the Collector‑‑‑District Collector, powers of‑‑‑Scope‑‑‑Circle Revenue Officer, who has , been allocated the relevant Revenue Circle is competent to take up the matters of mutations who can pass the order in accordance with law by sanctioning or rejecting the mutation forthwith or by holding the inquiry and passing the appropriate order thereafter‑‑‑Where the mutation is not sanctioned in terms of the provisions of S.42(10)‑& (6), West Pakistan Land Revenue Act, 1967 within three months of making of report of acquisition of a right, the Revenue Officer shall report the cause of delay to the Collector in the prescribed manner‑‑‑District .Collector under the provision of S.42(10), West Pakistan Land Revenue Act, 1967, cannot allocate the functions of a Circle Revenue Officer to the Collector.
(b) West Pakistan Land Revenue Act (XVH of 1967)‑‑‑
‑‑‑‑Ss. 42 & 161‑‑‑Mutation, sanctioning or rejecting of‑‑‑Exercise of power by Collector‑‑‑Effect‑‑‑Appeal against the decision of mutation either way by the Revenue Officer, lies before the Collector‑‑‑Where the powers of Circle Revenue Officer are allowed to be exercised by the Additional Deputy Commissioner (General) the aggrieved party has to prefer the appeal before the Commissioner of the Division/Additional Commissioner (Revenue) keeping in view the allocation of powers‑‑‑Aggrieved party loses one right of appeal in circumstances.
(c) West Pakistan Land Revenue Act (XVII of 1967)‑‑‑
‑‑‑‑S. 42‑‑‑Constitution of Pakistan (1973), Art.25‑‑‑Sanctioning of mutations where acquisition of title was based upon Permanent Transfer . Deeds/Transfer Orders‑‑‑Deputy Commissioner of the District restrained the Revenue Officers in the Civil District from sanctioning such mutations‑‑Validity‑‑‑All citizens under the provisions of Art.25 of the Constitution were equal before law and were entitled to equal protection of law‑‑‑ Mutations of all types including the acquisition of title on the basis of Permanent Transfer Deeds/Transfer Orders were being sanctioned by the Revenue Officers of the concerned circles in other Districts of the Province‑‑‑Such order of the Deputy Commissioner was violative of Art.25 of the Constitution, as no discrimination could be allowed to take place in a Civil District on the basis of the order passed by the Deputy Commissioner of the District in circumstances.
(d) West Pakistan Land Revenue Act (XVl1 of 1967)‑‑‑
‑‑‑‑S. 42‑‑‑Mutation of title acquired on the basis of Permanent Transfer Deeds/Transfer Orders‑‑‑Value‑‑‑Acquisition of title in any form provides cause of action to the person acquiring the property‑‑‑No specification exists in S.42, West Pakistan Land Revenue Act, 1967 to the effect that the mutations regarding acquisition of property through Permanent Transfer Deeds/Transfer Orders issued by the Settlement and Rehabilitation Department shall be treated in a different manner.
(e) West Pakistan Land Revenue Act (XVIII of 1967)‑‑‑
‑‑‑‑Ss. 14, 15, 16, 17 & 42‑‑‑Mutation, sanctioning ‑of‑‑‑Exercise of such powers by Assistant Commissioner Revenue Officers‑‑‑Deputy Commissioner had empowered the Assistant Commissioner (Revenue) to sanction the mutations where acquisition of title was on the basis of Permanent Transfer Deeds/Transfer Orders‑‑‑Validity‑‑‑Assistant Commissioner (Revenue) finds no mention anywhere in S.42, West Pakistan Land Revenue Act, 1967 which empowers the Deputy Commissioner in the matter‑‑‑Effect‑‑‑Deputy Commissioner cannot interfere in the jurisdiction of any other officer, keeping in view Ss. 14, 15, 16 & 17, West Pakistan Land Revenue Act, 1967‑‑‑Jurdisdiction of one Subordinate Officer cannot be exercised by the officer of the same department posted at the higher pedestal unless provided by the statute‑‑‑Order of Deputy Commissioner appointing any other officer to exercise power of Revenue Officer in terms of S. 42(6), West Pakistan Land Revenue Act, 1967, for the attestation of such mutations with the help of Circle Revenue Officer was without jurisdiction, without authority, illegal and coram non judice.
(f) Maxim‑‑‑
‑‑‑‑'‑ A communi observantia non est ' recedendum"‑‑‑Meaning and applicability‑‑‑Where a thing was provided to be done in a particular manner it had to be done in that manner and if not so done same would not be lawful, other methods of performance were necessarily forbidden‑‑‑Where a power was given to do a certain thing in a certain way, that thing was to be done in that way or not at all.
(g) West Pakistan Land Revenue Act (XVII of 1967)‑‑‑
‑‑‑‑S. 7‑‑‑Revenue Officer, classes of‑‑‑Jurisdiction of such officers‑‑Scope‑‑‑Classes of Revenue Officers are mentioned in S.7, West Pakistan Land Revenue Act, 1967, and all of them have to work within their own parameters in view of the statutory laws/rules/notifications.
(h) West Pakistan Land Revenue Act (XVII of 1967)‑‑‑
‑‑‑‑S. 42‑‑‑Notification No.6399‑91/22185‑E(F)III, dated I‑7‑1991‑‑Mutation‑‑‑Powers of District Collector in the Province of Punjab ‑‑‑Scope‑‑Vires of a mutation sanctioned by the Assistant Collector Grade I/Grade II (Tehsildar/Naib‑Tehsildar) cannot be examined and analysed by the District Collector of any District in the Province of Punjab‑‑‑District Collector is not competent to entertain any appeal or even any miscellaneous application in the light of Notification No.6399‑91/22185‑E(F)III, dated 1; 7‑1991.
Nazar Muhammad v. Deputy Commissioner, Bhakkar 1999 Law Notes Lah. 209 ref.
(i) West Pakistan Land Revenue Act (XVU of 1967)‑‑‑
‑‑‑‑S. 42‑‑‑Constitution of Pakistan (1973), Art. 199‑‑‑Constitutional petition‑‑‑Maintainability‑‑‑Mutation, sanction of‑‑‑Petitioner applied for sanction of mutation on 9‑8‑1995 and the same remained pending before the Additional Deputy Commissioner (General)‑‑‑Title of the petitioner was verified vide letter dated 6‑12‑1997 and the matter was referred to Teshildar for inquiry who submitted a report in favour of the petitioner‑‑‑Papers of the petitioner were sent by the Additional Deputy Commissioner (General) to the Deputy Commissioner seeking permission for sanction of the mutation‑‑Validity‑‑‑Substantive and procedural law incorporated in the West Pakistan Land Revenue Act, 1967, did not provide to face such an ordeal by the petitioner or any other citizen having the rights thereof‑‑‑Denial of the right of the petitioner and refusal to sanction the mutation by keeping the matter pending for about three years had conferred the right on the petitioner to invoke the help of High Court in exercise of Constitutional jurisdiction‑‑Provisions of Art. 199 of the Constitution had conferred very wide powers on High Court for enforcement of Fundamental Rights of citizens‑‑‑Act of the respondents/Authorities was illegal, without jurisdiction and coram non judice.
(j) Constitution of Pakistan (1973)‑‑‑
‑‑‑‑Art. 199‑‑‑Constitutional petition‑‑‑Term "aggrieved"‑‑‑Scope‑‑‑Where a person is denied a legal right by some one who has legal duty to perform relating to such right, such person is said to be an aggrieved person.
Ahmad Awais Khurram for Petitioner. Syed Zulfiqar Ali Bokhari, Asstt. A.‑G‑for Respondent.
Date of hearing: 25th October, 1999.
P L D 2000 Lahore 286
Before Malik Muhammad Qayyum and Ghulam Mahmood Qureshi, JJ
Messrs TATA TEXTILE MILLS LTD. through Director‑‑‑Petitioner
versus
ASSISTANT COLLECTOR (RECOVERY OFFICER), CUSTOMS CENTRAL EXCISE AND CUSTOMS, MULTAN and another‑‑‑Respondents
Writ Petition No.5904 of 1999 and Reference Application No. I of 1996, decided on 7th December, 1999.
(a) Customs Act (IV of 1969)‑‑‑
‑‑‑‑S. 84‑‑‑Expressions "entered for warehousing" and "warehoused"‑‑Distinction‑‑‑Where an application for "warehousing" of the goods has been made, it is said to be "entered for warehousing "‑‑‑Once the goods are deposited in the warehouse, the actual "warehousing" takes place.
(b) Customs Act (IV of 1969)‑‑‑
‑‑‑‑Ss‑ 84 & 108‑‑‑Appraising of value of goods in damaged state ‑‑‑Scope‑‑Goods were entered for warehousing before the same were burnt and gutted‑ ‑Importer was entitled to relief provided by 5.108, Customs Act, 1969, in circumstances.
(c) Customs Act (IV of 1969)‑‑‑
‑‑‑‑Ss. 27(1), 27(2) & 108‑‑‑Constitution of Pakistan (1973), Art.199‑‑Constitutional petition‑‑‑Notice demanding outstanding amount of duty‑‑‑Out of whole consignment of machinery imported by the petitioner, 26 cases of machinery were destroyed by fire while lying at the port‑‑‑Rest of the consignment was got cleared by the petitioner after the payment of leviable duty and taxes‑‑‑Authorities issued a notice to the petitioner for recovery of duty on such destroyed cases‑‑‑Contention by petitioner was that Authorities had acted illegally in applying S.27(1), Customs Act, 1969‑‑‑Validity‑‑When the goods were destroyed the same were not in possession or control of the petitioner and had not even cleared the customs barrier‑‑‑Provisions of 5.108, Customs Act, 1969 referred to in S.27(2), Customs Act, 1969, which provided the method for valuation of the goods, and provision of S.27(1) of the Customs Act, 1969, was neither referred, nor the same had been made applicable by reference in S.108, Customs Act, 1969‑‑‑Contention by petitioner, therefore, was well‑founded and S.27(1), Customs Act, 1969, was not attracted‑‑‑Where the goods had yet to be cleared either for home consumption or for warehousing and were not in the possession of the petitioner, the demand of payment of customs duty by the Authorities was anomalous, without lawful authority and of no legal effect in circumstances.
Salman Akram Raja for Petitioner.
A. Karim Malik for Respondents. '.
Date of hearing: 17th November, 1999.
P L D 2000 Lahore 290
Before 4ed Najam‑ul‑Hassan Kazmi and Mian Saqib Nisar, JJ
PRECISION ENGINEERING LTD. and others‑‑‑Appellants
versus
THE GRAYS LEASING LIMITED‑‑‑Respondent
E. F. A. No. 622 of 1999, heard on 11th January, 2000.
(a) Civil Procedure Code (V of 1908)‑‑‑
‑‑‑‑0. XXI, R.10‑‑‑Execution proceedings‑‑‑Premature proceedings‑‑Jurisdiction of Court‑‑‑Scope‑‑‑Even if the proceedings are initiated premature, the Court is not denied of its jurisdiction to grant relief, if the cause matures during the pendency of such proceedings.
Abdur Razaq v. Abdul Hamid 1979 SCMR 534 ref.
(b) Civil Procedure Code (V of 1908)‑‑‑
‑‑‑‑Ss. 38 & 47‑‑‑Compromise decree‑‑‑Enforcing of such decree‑‑‑Executing Court‑‑‑Jurisdiction‑‑‑Scope‑‑‑Executing Court could not go beyond the compromise decree and had to enforce the same as it was.
(c) Civil Procedure Code (V of 1908)‑‑‑
‑‑‑‑0. XXI, R.37(1), proviso‑‑‑Execution proceedings ‑‑‑Notice‑‑Dispensation with‑‑Conditions‑‑‑Where the Executing Court was satisfied by affidavit or otherwise that with the object of delaying execution of decree, the judgment‑debtor was likely to abscond or leave the local limits of jurisdiction of that Court, such notice could be dispensed with.
(d) Civil Procedure Code (V of 1908)‑‑‑
‑‑‑‑0. XXI, R. 37(2)‑‑‑Execution proceedings‑‑‑Failure of the judgment debtor to appear in obedience of notice issued under OAXI, R.37(1), C.P.C.‑‑‑Effect‑‑‑Where appearance was not so made in pursuance of such notice and if the decree‑holder so required, the Executing Curt would issue a warrant for the arrest of the judgment‑debtor
(e) Civil Procedure Code (V of 1908)‑‑‑
‑‑‑‑S. 51 & O.XXI; Rr.37, 38, 40‑‑‑Execution proceedings‑‑‑Detention of judgment‑debtor‑‑‑Scope‑‑‑The Executing Court under provisions of O.XXI, Rr.37, 38 & 40, C.P.C. can order for detention of judgment‑debtor in prison, only after the conclusion of inquiry‑‑‑Such order of. detention is also subject to the satisfaction of preconditions of S.51, C.P.C.
(f) Civil Procedure Code (V of 1908)‑‑‑
‑‑‑‑S. 51‑‑‑Execution proceedings‑‑‑Detention of ' judgment‑debtor in prison‑‑‑Prerequisites for such detention highlighted.
Unless the prerequisites of section 51 of C.P.C. are proved to exist, detention in prison cannot be ordered. The preconditions are that judgment debtor should be proved to have made attempt to leave the limits of Court, to obstruct the decree or execution thereof or dishonestly transferred the. property after the institution of the suit to avoid the decree or had the means to pay the decree and neglected to do the same. Without satisfaction of these preconditions, no mechanical order for detention in prison can be passed.
(g) Civil Procedure Code (V of 1908)‑‑‑
‑‑‑‑S. 51 & O.XXI, Rr.37, 38‑‑‑Banking Companies (Recovery of Loans, Advances, Credits and Finances) Act (XV of 1997), Ss. 9 & 13‑‑‑Execution proceedings‑‑‑Suit for recovery of loan‑‑‑Issuance of warrant for arrest before inquiry‑‑‑Validity‑‑‑Banking Court without attending to the real spirit of provision of law relating to execution, issued warrant of arrest of the judgment‑debtors‑‑‑Such order of the Executing Court could not be affirmed and judgment‑debtors, were entitled to join the proceedings by furnishing simple security for appearance in the Banking Court‑‑‑Said Court was required to decide the application for detention in prison after necessary inquiry and satisfaction of the conditions stated in S.51 and OXXI, R.37, C.P.C.‑‑‑Warrant of arrest issued by the Banking Court was set aside by High Court in circumstances.
Zahid Malik for Appellants.
Haq Nawaz Chattha for Respondent.
Date of hearing: 11th January, 2000.
P L D 2000 Lahore 296
Before Malik Muhammad Qayyum, J
Messrs PAKISTAN INDUSTRIAL AND COMMERCIAL
LEASING LTD. through Chief Executive‑‑‑Plaintiff
Versus
Messrs REGENT DYEING AND FINISHING MILLS (PVT.)
LTD. through Chief Executive and 5 others‑‑‑Defendants
Civil Original Suit No. 13 of 1999, decided on 9th June, 1999.
(a) Banking Companies (Recovery of Loans, Advances, Credits and Finances) Act (XV of 1997)‑‑‑
‑‑‑‑S. 11‑‑‑Bankers' Books Evidence Act (XVIII of 1891)‑‑‑Suit for recovery of Bank loan‑‑‑Leave to defend the suit‑‑‑Statement of account‑‑‑Contention of the defendant was that the statement of account was not properly maintained‑‑‑Validity‑‑‑Defendant placed nothing on record in support of his assertion, whereas certified copy of statement of accounts signed by the plaintiff was filed by the plaintiff‑‑‑Presumption of truth was attached to such statement under the provisions of Bankers' Books Evidence Act, 1891‑‑Leave to defend the suit was declined in circumstances.
(b) Banking Companies (Recovery of Loans, Advances, Credits and Finances) Act (XV of 1997)‑‑‑
‑‑‑‑S. 11‑‑‑Suit for recovery of Bank loan‑‑‑Leave to defend the suit‑‑Guarantor was employee of the company and stood as guarantor but subsequently he was substituted by another guarantor who was Director of the Company‑ Such fact was, prima facie, supported by memorandum of amendment signed by the debtors as also by the new guarantor‑‑‑Guarantor (defendant No.2) in circumstances, had disclosed a triable issue‑‑‑Leave to appear and defend the suit was granted in circumstances.
Zahid Malik for Plaintiff.
Ali Ahmad Awan for Defendants Nos. 1, 3, 4 and 5.
Syed Haider Ali Shah for Defendant No 2.
P L D 2000 Lahore 297
Before Malik Muhammad Qayyum, J
Messrs DAWOOD LEASING COMPANY LTD. Through Syed Ahmad Tausif, Account Officer‑‑‑Plaintiff
Versus
Messrs REGENT DYEING AND FINISHING MILLS (PVT.) LTD. through Chairman and 5 others‑‑‑Defendants
Civil Original Suit No. 145 of 1998, decided on 3rd June, 1999.
(a) Banking Companies (Recovery of Loans, Advances, Credits and Finances) Act (XV of 1997)‑‑‑
‑‑‑‑Ss. 9, 10 & 11‑‑‑Suit for recovery of Bank loan‑‑‑Application for leave to defend‑‑‑Contention of borrower was that the project could not go through as such the agreement between the parties was frustrated and Bank could, at the most, recover the machinery rented out‑‑‑Validity‑‑‑Where under the agreement, the borrower had undertaken to pay rentals in addition to price of machinery, contention of borrower was repelled‑‑‑If borrower could not set up the project or there was some difficulty in doing so, Bank could not be made to suffer‑‑‑Leave to defend the suit was .refused and suit was decreed accordingly.
(b) Banking Companies (Recovery of Loans, Advances, Credits and Finances) Act (XV of 1997)‑‑‑
‑‑‑‑S. 10‑‑‑Suit for recovery of Bank loan‑‑‑Application for leave to defend the suit‑‑‑Two agreements were in existence between the parties‑‑‑Contention by guarantor was that,. he was the first Chairman of the Company and after his resignation new guarantees were given to the Bank regarding the loan‑‑Validity‑Where the guarantee of the guarantor was with regard to the first agreement, , he could not escape his liability to the extent of loan due under the first agreement‑‑‑Guarantor was not liable to pay any amount d»e under the second agreement‑‑‑Application for leave to defend the suit was dismissed in circumstances.
Zahid Malik for Plaintiff.
Sohail Raza for Defendants Nos. I and 3 to 6.
Syed Haider Ali Shah for Defendant No.2.
P L D 2000 Lahore 299
Before Syed Zahid Hussain, J
BAHADUR KHAN‑‑‑Appellant
versus
JUNAID KHAN‑‑‑Respondent
Regular Second Appeal No.605 of 1980, heard on 23rd November, 1999.
(a) Civil Procedure Code (V of 1908)‑‑‑
‑‑‑‑S. 100‑‑‑Second appeal‑‑‑Question of limitation‑‑‑Re‑appreciation of evidence‑‑‑Scope‑‑‑Where there was no view of the Lower Appellate Court on the question of limitation, High Court could not re‑appreciate the evidence nor could come to the different conclusion in second appeal.
Hakim Muhammad Buta and another v. Habib Ahmad and others PLD 1985 SC 153 distinguished.
(b) Punjab Pre‑emption Act (I of 1913)‑‑‑
‑‑‑‑Ss. 21 & 30‑‑‑Civil Procedure Code (V of 1908), S.100‑‑‑Second appeal‑‑‑Question of limitation‑‑‑Reappraisal of evidence in second appeal‑‑Suit filed by the pre‑emptor was decreed by Trial Court and decision was upheld by Lower Appellate Court‑‑‑Contention raised by vendee was that the suit was filed beyond the period of limitation and any concession given to plaintiff at the lower appellate stage on the issue of limitation, did not stop the vendee to challenge same before High Court in second appeal‑‑Validity‑‑‑Where question of limitation was not a pure question of law, no findings could be recorded on such question without adverting to the evidence on record‑‑‑Findings recorded by the Trial Court on the question of limitation were consciously conceded before the Lower Appellate Court and such issue of limitation could not be re‑opened in second appeal‑‑‑Where findings on other issues were not agitated the judgments of both the Courts below did not warrant interference.
Niaz Ahmad and others v. Mian Abdul Rehman and others PLD 1961 (W.P.) BJ 1 and Nazar Muhammad and another v. Mst. Shahzada Begum and another PLD 1974 SC 22 ref.
Ghulam Muhammad and others v. Malik Abdul Qadir Khan and others PLD 1983 SC 68 and Manzoor Khan v. Ch. Muhammad Malik and others 1991 CLC Note 370 at p.379 rel.
Syed Zamir Hussain for Appellant.
Qazi Mushab‑ul‑Hasan for Respondent.
Date of hearing: 23rd November, 1999.
P L D 2000 Lahore 302
Before Malik Muhammad Qayyum, J
NAZIM POLY SACK LIMITED, MUSLIM TOWN, LAHORE‑‑‑Petitioner
versus
THE FEDERATION OF PAKISTAN through Secretary Finance, Federal Secretariat, Islamabad
and 6 others‑‑‑Respondents
Writ Petitions Nos. 11264, 8039, 18452, 18453 of 1995, 3706, 2375, 2376, 2507, 2508, 4273, 4274, 6340, 4024, 4028, 4033, 6942, 13443, 14139, 22255 and 22274 of 1996, decided on 19th October, 1999.
(a) Central Excises Rules, 1944‑‑‑
‑‑‑‑R. 96‑ZZL ‑‑‑Central Excises Act (I of 1944), Ss.3, 3‑CC & 4‑‑Constitution of Pakistan (1973), Art.199‑‑‑Vires of Central Excises Rules, 1944 on the touchstone of Ss.3, 3‑CC & 4, Central Excises Act, 1944‑Levying of duty on same material not being end product during course of manufacture‑‑‑Validity‑‑‑Rule 96‑ZZL, Central Excises Rules,, 1944 was not ultra vires the provisions of Ss.3, 3‑CC & 4, Central Excises Act, 1944‑‑Polypropylene strips were capable of being sold and mere fact that such strips were not end product was not enough to save them from the excise duty‑‑‑No prohibition in law existed against levying duty on same material at more than one stage during the course of its manufacture.
Adil Polypropylene Products v. The Federation of Pakistan etc. 1997 MLD 2189 and Sh. Fazal Elahi v. Federation of Pakistan and 3 others 1988 MLD 524 fol.
(b) Customs Act (IV of 1969)‑‑‑
‑‑‑‑S. 35(4), Sched. I, Chap. 39, Hdg. 3902.1000 & Chap. 63, Hdg. 6503.3100‑‑‑S. R. O. No.710(I)/94, dated 13‑7‑1994‑‑‑S. R. O. No.546(I)/94, dated 9‑6‑1995‑‑‑Central Excises Act (I of 1944), Ss.3, 3‑CC & 4‑‑‑Constitution of Pakistan (1973), Art.199‑‑‑Constitutional petition‑‑Levy of Central Excise Duty on strips of polypropylene‑‑‑Failure to make such demand of duty without holding of factual inquiry as to whether such strips were marketable‑‑‑Effect‑‑‑Polypropylene strips were synthetic material and the contention regarding classification of the goods as textile rather than plastic was rejected‑‑‑Such demand without holding factual inquiry was valid as the strips were dutiable, irrespective of the actual weight‑‑‑In any case it was a question of fact which should have been raised by filing an appeal‑‑‑Constitutional petition was dismissed in circumstances.
Orient Straw Board and Paper Mills Ltd. Karachi v. The Assistant Collector of Central Excise and others PLD 1985 Kar. 126; Trust Ceramic Industries Landhi v. Deputy Collector‑II, Central Excise and Land Customs, Karachi 1991 CL!‑ 1923; Union of India and another v. Delhi Cloth and General Mills Co. Ltd. AIR 1998 SC 791; Civil and Military Press Ltd. and others v. Pakistan through Secretary and others 1985 CLC 1021 and Sohail Jute Mills Ltd. and others v. Federation of Pakistan and others PLD 1991 SC 329 ref.
Imtiaz Rashid Siddiqui for Petitioner.
S.M. Masud and Kh. Saeed‑uz‑Zafar, Deputy Attorney‑General for Pakistan for Respondents.
Date of hearing: 29th June, 1999.
P L D 2000 Lahore 306
Before Mrs. Fakhar‑un‑Nisa Khokhar, J
MUHAMMAD SHARIF and another‑‑‑Petitioners
versus
MUHAMMAD SIDDIQ ‑‑‑ Respondent
Civil Revision No.458‑D of 1985, heard on 15th November, 1999.
(a) Punjab Pre‑emption Act (I of 1913)‑‑‑
‑‑‑S. 3(5)‑‑‑Sale‑‑‑Mode of‑‑‑Nature of transaction‑‑‑Determination‑‑‑Mode of sale having not been contemplated in Punjab Pre‑emption Act, 1913, nature of transaction had to be taken into consideration to determine whether the sale was complete or not‑‑‑For the purpose of sale, the intention of parties was looked into and such intention was to be gathered from the statement of the parties and their acts at the time of transaction and thereafter‑‑‑Registration of sale‑deed had not been made a prerequisite for completion of sale for the purposes of right of pre‑emption.
(b) Punjab Pre‑emption Act (I of 1913)‑‑‑
‑‑‑‑S. 4‑‑‑Civil Procedure Code (V of 1908), O.XX, R.14‑‑‑"Right of pre‑emption"‑‑‑Nature‑‑‑Pre‑emption is a right of substitution in place of vendee.
(c) Punjab Pre‑emption Act (I of 1913)‑‑‑
‑‑‑‑Ss. 3(5), 4 & 15‑‑‑Pre‑emption suit‑‑‑Transfer of land through a decree for specific performance‑‑‑Such transaction being sale was pre‑emptible‑‑‑Both the Courts below found such transaction as sale and held the pre‑emptor to be having superior rights of pre‑emption ‑‑‑Suit was decreed and the appeal was dismissed by the Lower Appellate Court‑‑‑Validity‑‑‑Sale in such case was complete‑‑‑No intervention was needed in the concurrent findings arrived at by the Courts below.
Hakim Enayat Ullah v. Khali l Ullah Khan and another AIR 1938 All. 432; Muhammad Ishaq v. Muhammad Siddique PLD 1975 Lah. 909; Abdul Majid v. Nizam Din and another PLD 1959 Lah. 273; Nur Ahmad and others v. B. Muhammad Ibrahim and another PLD 1953 Lah. 470; Muhammad Wazir v. Ch. Jahangin. Mal and others PLD 1949 Lah. 1; Muhammad Nawaz v. Fida Hussain and another ~ 1994 CLC 1487; Syed Manzoor Hussain Shah v. Khurshid Ahmad and 4 others 1989 CLC 1372; The P&T Cooperative Housing Society Ltd., Karachi v. Ch. Manzoor Ahmed Sahi PLD 1961 (W.P) Kar. 53; Nasir and others v. Muhammad Ali and others PLD 1961 (W.P.) Rev. 41; Abdul Qadir and others v. Ghulam Qadir 1996 CLC 1216; Abdul Karim v. Fazal Muhammad Shah PLD 1967 SC 411; Muhammad Bakhsh v. Zia Ullah and others 1983 SCMR 988; Gullan v. Muhammad Ramzan and others PLD 1962 (W.P.) BJ 33; Malik Tahir Ahmad and another v. Tanseef ur Rehman and another 1988 SCMR 1861; Malik Hussain and others v. Lala Ram Chand and others PLD 1970 SC 299; Abdul Majid v. Tora Baz Khan PLD 1975 Lab. 628; Wali Muhammad v. Dost Muhammad 1986 CLC 1220 and Khair Din v. Haji Muhammad Din and others 1987 SCMR 1131 ref.
Muhammad Sharif Chohan and Malik Amjad Pervaiz for Petitioners.
Muhammad Zafar Ch. for Respondent.
Date of hearing; 15th November, 1999.
P L D 2000 Lahore 314
Before Syed Najam‑ul‑Hassan Kazmi, J
PUNJAB PROVINCE through Secretary to Government of the Punjab; Irrigation and Power Department, Lahore and another‑‑‑Appellants
Versus
Messrs CHAUHAN & COMPANY through Managing Partner‑‑‑Respondent
First Appeal from Order No. 122 of 1998, heard on 3rd November, 1999.
(a) Arbitration Act (X of 1940)‑‑‑
‑‑‑‑Ss. 13 & 29‑‑‑Arbitrator awarding interest‑‑‑Competency‑‑‑Enforcing of terms different than those contained in contract‑‑‑Validity‑‑‑In absence of any contract or statutory provisions of mercantile usage, the arbitrator was not competent to award interest‑‑‑Arbitrator was not entitled to act in breach of terms of the contract or to enforce terms different than the one contained in that contract.
Ghulam Abbas v. Trustees of the Port of Karachi PLD 1987 SC 393 rel.
(b) Arbitration Act (X of 1940)‑‑‑
‑‑‑‑Ss. 17, 30 & 31‑‑‑Award‑‑‑Examination of‑‑‑Question of misconduct and legal error‑‑‑Jurisdiction of Trial Court‑‑‑Scope‑‑‑Arbitrator was a Judge of law and facts but that would not mean that the Trial Court was denuded of its jurisdiction to examine the question of misconduct and legal error apparent on the face of award‑‑‑Court was not bound to provide blanket to any illegal, irrational or illegal award.
(c) Arbitration Act (X of 1940)‑‑‑
‑‑‑‑Ss. 31 & 39‑‑‑Examination of validity of award by the Court‑‑‑Scope‑‑Repelling of objections without framing of issues and recording of evidence‑‑‑Validity‑‑‑Court repelled the objections against the award without framing of issues and recording of evidence‑‑‑Court under the provisions of S.17 of Arbitration Act, 1940 was bound to examine the award if the same suffered from any invalidity, misconduct and error of law, though no objections had been filed‑‑‑Court was also bound to consider if the award was liable to be remitted‑‑‑Where the Court did not give serious consideration to the matter of extra importance and objections against the award, order of the Court making award as rule of the Court was set aside by High Court.
Shahid Mobeen, Asstt. A.‑G. for Appellants.
Riaz Karim Qureshi for Respondent.
Date of hearing: 3rd November, 1999.
P L D 2000 Lahore 323
Before Amir Alam Khan, J
INTERNATIONAL FINANCE CORPORATION, WASHINGTON D.C. 20433 U.S.A. ‑‑‑Petitioner
Versus
HALA SPINNING LTD., GULBERG II, LAHORE‑‑‑Respondent
Civil Original No.26 of 1996,. decided on 23rd December, 1999.
(a) Companies Ordinance (XLVII of 1984)‑‑
‑‑‑‑Ss. 305 & 306(1)(a)‑‑‑Company's inability to pay its debts‑‑‑Winding up petition by creditors‑‑‑Principle‑‑‑Where it is found that the company is unable to pay its debts for no plausible reason such as there being no bona fide dispute, the company shall ordinarily be wound up.
Ali Woollen Mills v. IDBP PLD 1990 SC 763; PICK v. National Silk and Rayon Mills PLD 1976 Lah. 1538; U.B.L. v. Pak Wheat Products Ltd. PLD 1970 Lah. 235; National Bank of Pakistan v. Punjab National Silk Mills PLD 1969 Lah. 194; Sindh Glass Industries v. NDFC and others PLD .1996 SC 601; Habib Bank Limited v. Hamza Board Mills PLD 1996 Lah. 633; Park Davis v. Bliss & Company PLD 1982 Kar: 94 and Messrs Bankers Equity Limited v. Balochistan Coasters Limited PLD 1997 Kar. 416 ref.
(b) Companies Ordinance (XLVII of 1984)‑‑‑
‑‑‑‑Ss. 305 & 306(1)(a)‑‑‑Company's inability to pay its debts‑‑‑Compulsory winding up of such company‑‑‑Aspects of commercial insolvency of a company=‑‑Aspects to be considered were‑failure or refusal to pay the loan amount to the creditors after statutory notice; whether debts were more than paid‑up capital; that there was no earning capacity t‑)' pay the debts in present or future and that the balance‑sheet of the company sought to be wound‑up disclosed that the company was running into losses without there being any hope of its revival‑‑‑Where such aspects were manifestly present, the company should in normal course be wound‑up.
Ali Woollen Mills v. IDBP PLD‑ 1990 SC 763; PICIC v. National Silk and Rayon Mills PLD 1976 Lah. 1538; U.B.L. v. Pak Wheat Products Ltd. PLD 1970 Lah. 235; National Bank of Pakistan v. Punjab National Silk Mills PLD 1969 Lah. 194; Sindh Glass Industries v. NDFC and others PLD 1996 SC 601; Habib Bank Limited v. Hamza Board Mills PLD 1996 Lah. 633; Park Davis v. Bliss & Company PLD 1982 Kar. 94 and Messrs Bankers Equity Limited v. Balochistan Coasters Limited PLD 1997 Kar. 416 ref.
(c) Companies Ordinance (XLVII of 1984)‑‑‑.
‑‑‑‑Ss. 305 & 306(1)(a)‑‑‑Company's inability to pay its debts‑‑‑Petition for winding‑up by creditors‑‑‑Plea of mala fide by company on the basis of delay‑‑‑Petitioner did not rely on the feasibility report prepared by the experts of the company and obtained such report from its own experts‑‑Contention by the company was that in obtaining such report, the facility of tax holiday available to the company came to an end‑‑‑Validity‑‑‑Company did not raise a single finger as to obtaining of report from such expert as also the event subsequent thereto‑‑‑Where the company accepted the position and went alongwith the petitioner, it was hard to believe that the delay was caused by the petitioner alone‑‑‑Plea of mala fide on the basis of delay was repelled in circumstances.
(d) Companies Ordinance (XLVII of 1984)‑‑‑
‑‑‑‑Ss. 305 & 306(1)(a)‑‑‑Company's inability to pay its debts‑‑‑Petition for winding up by creditors‑‑‑Plea of bona fide dispute on the basis of failure to. provide financial assistance in time‑‑‑Validity‑‑‑Petitioners did not promise to extend any other financial assistance except the one already rendered and asked the company to raise its own equity and such was a futile expectation‑‑‑Such plea of bona fide dispute was not accepted accordingly.
U.B.L. v. Pak Wheat Products PLD 1970 Lah. 235; Punjab National Silk Mills v. National Bank of Pakistan 1986 $CMR 1126 and Sindh Glass Industries v. N.D.F:C. and others PLD 1996 SC 601 ref.
(e) Companies Ordinance (XLVII of 1984)‑‑‑
‑‑‑‑Ss. 305 & 306(l)(a)‑‑‑Winding up of company‑‑‑Petition by creditors‑‑Plea of bona fide dispute on the basis of failure on the part of the petitioner to provide advice on the technical side of the project‑‑‑Validity‑‑‑Petitioner was a financing institution and such advice was not the part of petitioner's business, nor it was rendered in that respect, rather the petitioner itself asked for such advice from a third party‑‑‑Technical advice sought by the petitioner for itself was not imposed on the company‑‑‑Where it was not shown on the record that either contractually or even otherwise such a responsibility was taken by the petitioner or that the company relied on the same , petitioner was not held responsible for giving such advice in circumstances.
Henderson v. Merrett (1994) 3 All ER 506 ref.
(f) Banker and customer‑‑‑
‑‑‑Banks have fiduciary relationship with their customers.
Abdul Rahim and 2 others v. Messrs United Bank Ltd. of Pakistan PLD 1997 Kar. 62 ref.
(g) Companies Ordinance (XLVII of 1984)‑‑‑
‑‑‑‑Ss. 305 & 306(l)(a)‑‑‑Winding up of company‑‑‑Petition by creditors on the basis of inability to pay debts‑‑‑Failure on the part of the petitioner to provide technical advice to the company‑‑‑Plea of fiduciary relationship‑‑Contention raised by the company was that even if there was no contract providing that Bank would advise the customers, the liability in the tort would arise because of fiduciary relationship of the Bank with their customers‑‑‑Validity‑‑‑Company had obtained a feasibility report from a third party so was the case with the petitioner who also obtained such feasibility from another party‑‑‑Petitioner endorsed its disclaimer on the face of such report, making it so obvious that the petitioner was not prepared to take responsibility about the feasibility/technicality of the project right from its installation‑‑‑Where such departure was conscious and was clearly understood by both the parties, it could not be imputed that the petitioner was obliged to give any advice in installing the project‑‑‑Such plea raised by the company was misconceived in circumstances.
Woods v. Martins Bank (1958) 3 All ER 166; Hedley Byrne & Co. Ltd. v. Heller and Partners Ltd. (1963) 2 All ER 575; Henderson v. Merrett (1994) 3 All ER 506 and Abdul Rahim and 2 others v. Messrs United Bank Ltd. of Pakistan PLD‑1997 Kar. 62 ref.
(h) Companies Ordinance (XLVII of 1984)‑‑‑
‑‑‑‑Ss. 305 & 306(l)(a)‑‑‑Company's inability‑to pay its debts‑ ‑‑Petition for winding up by creditors‑‑‑Plea of bona fide dispute on refusal to re‑schedule loan‑‑‑Validity‑‑‑Request for re‑scheduling was a factor. to prove that the company was prepared to go alongwith the project rather than to dispute the debt on the ground of bona fide dispute‑‑‑Refusal to re‑schedule the loan could not be taken as suggestive of a bona fide dispute in circumstances.
U.B.L. v. Pak Wheat Prodcuts PLD 1970 Lah. 235; Sindh Glass Industries v. N.D.F.C. and others PLD 1996 SC 601; Messrs Platinum Insurance Company v. Daewoo Corporation Sheikhupura PLD 1999 SC 1 and State Bank of India v. Hagde & Golay Ltd. 62‑ICC 239 ref.
(i) Companies Ordinance (XLVII of 1984)‑‑‑
‑‑‑‑Ss. 305 & 306(I)(a)‑‑‑Company's inability to pay its debts‑‑‑Petition for winding up by creditors‑‑‑Plea of bona fide dispute‑‑‑Claim of equitable set off‑‑‑Where plea of bona fide dispute was decided, the ancillary question that equitable set off could be claimed, might not be gone into.
(j) Words and phrases‑‑
‑‑‑‑"Consortium"‑‑‑Meaning‑‑‑Consortium signifies‑‑‑Joining , of several persons as parties to one action.
Black's Law Dictionary ref.
(k) Companies Ordinance (XLVII of 1984)‑‑‑
‑‑‑‑Ss. 305 & 306(1)0)‑‑‑Company's inability to pay its debts‑‑‑Petition for winding up by creditors‑‑‑Contention by the company was that it was discretionary with the Court to order or not to order winding‑up of the company‑‑‑Validity‑‑‑Held, it was really not necessary for every company to be liquidated and that before liquidating any company, it was also to be considered as to what was in the best interest of the country for it is not intended that the economic activity be stopped or clogged.
(l) Companies Ordinance (XLVII of 1984)‑‑‑
‑‑‑‑Ss. 305 & 306(1)(a)‑‑‑Company's inability to pay its debts‑‑‑Petition for winding up by creditors‑‑‑Auditors expressed serious doubts about the running and functioning of project of the company‑‑‑Effect‑‑‑Where such report of the auditors was coupled with the fact that the total amount of debt had not been paid‑up by the company there was no use in carrying on with such project of the company‑‑‑Although the company was' a running concern and was producing quality yarn, yet with no profitability‑‑‑Adding up interest on the loan was of no use as the same was increasing day by day and the clock was further ticking‑‑‑Company was ordered to be wound‑up in circumstances.
Dr. Pervaiz Hassan and Faisal Islam for Petitioner. Aitzaz Ahsan for Respondent.
Dates of hearing: 17th, 22nd and 23rd December, 1999.
P L D 2000 Lahore 344
Before .Tassaduq Hussain Jilani, J
NADEEM MOHSAN QIZILBASH ‑‑‑ Petitioner
Versus
UNIVERSITY OF PUNJAB through Vice‑Chancellor, Punjab University, Old Campus, Lahore and 3 others‑‑‑Respondents
Writ Petitions Nos.26232 of 1997 and 12863 of1999, decided on 31st December, 1999.
Educational institution‑‑‑
‑‑‑‑Use of unfair means by candidate‑‑‑Disqualifying the candidate fox a period of three years‑‑‑Candidate who appeared in LL.B. (old course) First Annual Examination was charge‑sheeted for having used unfair means in Paper VII of LL.B. and as such was disqualified for a period of three years‑‑Contention raised by candidate was that he was condemned unheard‑‑University Authorities raised the plea that the candidate was beneficiary of the inflation in marks and discrepancy committed in the result‑‑‑Validity‑‑‑, Candidate was declared successful securing 316 marks in the initial Gazette notification‑‑‑Result of the candidate was shown as "later one" in charge‑sheet against the candidate alleging that in Paper VII of LL.B although the candidate had failed, but in the merit list his marks were inflated to 40 declaring him as having passed and had such marks not been added, the candidate could not have passed‑‑‑Candidate was issued a show‑cause notice by the University and he was fully heard and had availed his right of appeal‑‑‑When the candidate was the beneficiary of inflation and discrepancy in the marks, the same was a strong circumstance implicating the candidate with such forgery.
Samar Pervez v. Board of Intermediate and Secondary Education, Lahore and another PLD 1971 SC 838 and Faiza Malik v. Chairman, Board of Intermediate and Secondary Education, Lahore and 2 others PLD 1992 SC 324 distinguished.
Ahmad and 3 others v. Vice‑Chancellor, University of Engineering and Technology and others PLD 1981 SC 464; Ifran Jamil Khan v. University of Engineering and Technology, Lahore and others 1998 SCMR 2502; Rahat Siddiqui v. Board of Intermediate and Secondary‑ Education, Lahore and another 1977 SCMR 213 and Board of Intermediate and Secondary Education, Sargodha and another v. Muhammad Rafique PLD 1991 SC 231 ref.
Abid Hassan Minto for Petitioner.
Muhammad,Raza Farooq for Respondents.
Date of hearing: 21st December, 1999.
P L D 2000 Lahore 349
Before Malik Muhammad Qayyum and Ghulam Mahmood Qureshi, JJ
GHAZI FABRICS INTERNATIONAL LIMITED, GULBERG‑III, LAHORE through Chief
Executive‑‑‑Appellant
versus
WATER AND POWER DEVELOPMENT AUTHORITY, LAHORE and 3 others‑‑‑Respondents
Intra‑Court Appeals Nos. 848, 902, 908 to 923, 926 to 928 and 937 to 939 of 1999, decided on 7th December, 1999.
(a) Regulation of Generation, Transmission and Distribution of Electricity Power Act (XL of 1997)‑‑‑
‑‑‑‑S. 31‑‑‑Tariffs‑‑‑Jurisdiction of WAPDA to change tariffs ‑‑‑Scope‑‑WAPDA was licensee and the provisions of Regulation of Generation, Transmission and Distribution of Electricity Power Act, 1997, as a whole including its S.31 were equally applicable to WAPDA also ‑‑‑WAPDA, thus, had no jurisdiction either to reduce, modify or fix the rate of charges for the consumption of electricity by the consumers.
(b) Regulation of Generation, Transmission and Distribution of Electricity Power Act (XL of 1997)‑‑‑
‑‑‑‑Ss. 31 & 39‑‑‑Constitution of Pakistan (1973), Art.199‑‑‑Constitutional petition‑‑‑Maintainability‑‑‑Withdrawing of Tariff 'J' by WAPDA‑‑Constitutional petition was filed without filing complaint under S.39 of Regulation of Generation, Transmission and Distribution of Electricity Power Act, 1997‑‑‑Dispute related to withdrawing of Tariff 'J' by, WAPDA and the contention .by the petitioner was that such withdrawal was without jurisdiction‑‑‑Validity‑‑‑Where dispute raised was about the jurisdiction of the Authority to take any action, Constitutional petition could be maintained since alternate remedies provided by S‑. 39 of Regulation of Generation, Transmission and Distribution of Electricity Act, 1997 were neither adequate nor efficacious as the same did not provide a right of hearing‑‑‑Act of the Authority was declared to‑ be without lawful sanction and of no legal effect.
(c) Constitution of Pakistan (1973)‑‑‑
‑‑‑‑Art. 199‑‑‑Constitutional petition‑‑‑Maintainability‑‑‑Action of Authority was challenged as being without jurisdiction and void‑‑‑Constitutional petition was maintainable especially when fate of the case depended upon interpretation of the statutory provisions.
Attock Cement Pakistan Ltd. v. Collector of Customs and 4 others 1999 PTD 1892; Gatron (Industries) Ltd. v. Government of Pakistan and others 1999 SCMR 1072; Pakistan Tobacoo Company Ltd. and another v. Federation of Pakistan and 3 others 1999 SCMR 382; Murree Brewery Co. Ltd. v. Pakistan through the Secretary to Government of Pakistan and 2 others PLD 1972 SC 279 and Usmania Glass Sheet Factory Ltd., Chittagong v. Sales Tax Officer, Chittagong PLD 1971 SC 205 ref.
(d) Regulation of Generation, Transmission and Distribution of Electricity Power Act (XL of 1997)‑‑‑
‑‑‑‑S. 39‑‑Constitution of Pakistan (1973). Art. 199‑‑‑Constitutional petition‑‑‑Maintainability‑‑‑‑Filing of Constitutional petition without availing remedy available under law‑‑‑View that recourse open to the petitioner was filing of civil suit, instead of Constitutional petition‑‑‑Validity‑‑‑Remedy of civil suit was not provided in the statute itself but was available under the general law and the same was not equally efficacious remedy‑‑‑Where there was no factual dispute involved between the parties and fate of the case depended upon the interpretation of a statute, Constitutional petition was maintainable.
Salahuddin and 2 others v. Frontier Sugar Mills and Distillery Ltd., Tokht Bhai and 10 others PLD 1975 SC 244 ref.
(e) Constitution of Pakistan (1973)‑‑‑
‑‑‑Art. 199‑‑‑Constitutional petition‑‑‑Failure to have recourse to the revisional remedy does not necessarily operate as a bar for invocation of Constitutional jurisdiction.
Mst. Hussain Bibi v. Haji Muhammad Din and 3 others 19781 SCMR 395 ref.
(f) Administration of justice‑‑‑
‑‑‑‑ No action detrimental to the interest of any person can be taken without meeting the minimum requirements of natural justice which are part of every statute of law according to which an opportunity ,of being heard must be accorded to the aggrieved person.
Salman Akram Raja for Petitioner.
M. Ilyas Khan for WAPDA.
Date of hearing: 24th November, 1999.
P L D 2000 Lahore 355
Before Mrs. Fakhar‑un‑Nisa Khokhar, J
MUHAMMAD ASLAM‑‑‑Petitioner
versus
Mst. SURAYA ‑‑‑ Respondent
Writ Petition No. 3547 of 2000, decided on 2nd March, 2000.
(a) Muslim Family Laws Ordinance (VII of 1961)‑‑‑‑
‑‑‑‑S.5‑‑‑West Pakistan Family Courts Act (XXXV of 1964), S.23‑‑Registration of marriage‑‑‑Validity of registered marriage‑‑‑Jurisdiction of Family Court‑‑‑Validity of marriage registered under Muslim Family Laws Ordinance, 1961, would not be questioned by Family Court nor any evidence in regard thereto would be admissible before the said Court‑‑‑‑If marriage was questioned on ground of fraud or misrepresentation, remedy would not be available with the Family Court, but with the Court of general jurisdiction‑‑‑Legislature had provided that four copies of Nikahnama should be prepared, one was to be kept by Registrar of Nikah, second one to be sent to concerned Municipal Corporation, Municipal Committee or Union Council as the case may be, third copy was to be supplied to bride and fourth one to the bridegroom, to verify that entries in Nikahnama were according to the terms of marriage settled between the parties.
(b) Muslim Family Laws Ordinance (VIII of 1961)‑‑‑
‑‑‑‑S. 5‑‑‑Marriage under Muslim Law‑‑‑Nature and essentials of ‑‑‑Nikah Registrar‑‑‑Status‑‑‑Interpolation in entries of Nikah Register ‑‑‑Remedy‑‑ Marriage under Muslim Law, was a civil contract‑‑‑‑Essentials of marriage were that any person who was capable of contracting a marriage, was not suffering from any legal disability; was of sound mind and who understood nature of contract and would enjoy freedom to enter into the contract of marriage ‑‑‑Nikah Registrar under Muslim Family Laws Ordinance, 1961, being a public servant within meaning of S.21, P.P.C. discharged public duty‑‑‑If any party was of the view that Nikah Registrar had interpolated in the entries of Nikah Register, such. party could approach the Deputy Commissioner who was the Controlling. Authority and could get the same corrected.
Mst. Hanifan v. D.C. and others PLD 1967 Kar. 165 ref.
(c) Muslim Family Laws Ordinance (VIII of 1961)‑‑‑‑
‑‑‑‑Ss. 5 & 10‑‑‑West Pakistan Family Courts Act (XXXV of 1964), S.5 & Sched.‑‑‑Transaction of dower‑‑‑Completion of‑‑‑Suit for recovery of dower‑‑‑Transaction of dower would become complete on the day of marriage‑‑‑Endorsement of dower against column in Nikahnama was a verification of settlement and arrangement already reached between the parties‑‑‑If woman would make a demand through filing a suit for recovery of dower, person contending that entries in Nikahnama were not correct, was bound to rebut said entries through a strong evidence otherwise Court was bound to give a solemn affirmation to the entries in Nikahnama.
Naseer Ahmad Qureshi for Petitioner.
P L D 2000 Lahore 359
Before Mrs. Fakhar‑un‑Nisa Khokhar, J
MUHAMMAD WALAYAT‑‑‑Petitioner
versus
MAQSOODAN BIBI‑‑‑Respondent
Writ Petition No.3357 of 2000, decided on 29th February, 2000.
(a) Dissolution of Muslim Marriages Act (VIII of 1939)‑‑‑‑
‑‑‑‑S.2(viii)‑‑‑West Pakistan Family Courts Act (XXXV of 1964), S.5 & Sched.‑‑‑Dissolution of marriage on allegation of adultery against wife‑‑Husband had levelled allegation of adultery against wife alleging that she lived with a stranger and that she was abducted‑‑‑Husband had not produced any evidence to prove the allegations which was not permissible by law and also by Qur'anic Injunctions unless. strictest proof and strong evidence was brought forward by the party levelling such allegations‑‑‑Whenever such allegations were levelled against a lady, Courts must ask for the strictest proof of such allegations in view of common dignity and respect of women in Islam‑‑‑If such proof was not made available on record by person who had levelled accusation, Court would be bound to dissolve marriage on that score.
(b) Dissolution of Muslim Marriages Act (VIII of 1939)‑‑‑
‑‑‑‑S.2(viii)‑‑‑West Pakistan Family Courts Act (XXXV of 1964), S.5 & Sched.‑‑‑Dissolution of marriage on allegation of adultery‑‑‑If husband had charged his wife with adultery, wife would be entitled to claim judicial divorce without any prejudice to her right to bring defamatory suit for unjust infraction‑‑‑Husband was required to substantiate his accusation of adultery against wife by producing four witnesses, but if no evidence, except himself was available, he could take an oath or liar‑‑‑If wife declined and also took oath, Court must separate them as the sexual union had become unlawful and under such circumstances, decree of divorce could not be avoided by husband by his retraction of 'charge as no chance of retraction would be allowed to husband‑‑‑Retraction would amount to acknowledgment by husband and he could be punished for that.
Muhammad Sarwar v. Sughran Bibi and others 1996 MLD 1057; Rahiman v. Fazil AIR 1927 A11. 56 and Ahmad Suleman Vohra v. Bai Fatima AIR 1955 Bom. 160 ref.
(c) Dissolution of Muslim Marriages Act (VIII of 1939)‑‑‑
‑‑‑‑S.2(viii)‑‑‑West Pakistan Family Courts Act (XXXV of 1964), S:5 & Sched.‑‑‑Dissolution of marriage on allegation of adultery‑‑‑Powers of Family Court‑‑‑Family Court had inherent power not only to dissolve marriage where allegation of adultery was levelled and such allegation was not supported by strong evidence by person who alleged the same, but could also penalize the person who had levelled the allegation of adultery without proof or throwing mud upon character of his wife by way of flimsy accusation without bringing forth any solid proof in evidence, burdening him to heavy costs and granting compensation to injured lady in view of her sacred right of reputation protected by dictates of Holy Qur'an.
Ras Tariq Chaudhary for Petitioner.
Nemo for Respondent., Date of hearing: 29th February, 2000.
P L D 2000 Lahore 364
Before‑Mian Nazir Akhtar, J
ATA ULLAH‑‑‑Petitioner
Versus
THE STATE‑‑‑Respondent
Criminal Miscellaneous No.858‑B of 1999/BVJP, decided on 3rd November, 1999.
(a) Criminal Procedure Code (V of 1898)‑‑‑
‑‑‑‑S. 154‑‑‑Machinery of law can be set in motion by any person who need not necessarily be a resident of the locality where an offence takes place.
(b) Criminal Procedure Code (V of 1898)‑‑
‑‑‑‑S. 156‑‑‑Investigation‑‑‑Cognizable offence‑‑‑Receipt and recording of First Information Report was not a condition precedent to the setting in motion of a criminal investigation in cases involving cognizable offence and an illegality committed in this respect, did not per se, vitiate the arrest of the accused or his trial.
Riaz Ahmad v. The State PLI) 1994 Lah. 485 fol.
(c) Penal Code (XLV of 1860)‑‑
‑‑‑‑S. 298‑B‑‑‑Primary object of 5.298‑B, P.P.C.
The primary object of section 298‑B, P.P.C. is to protect and preserve the glory, honour and sanctity of the Ahle‑Bait, the Caliphs of the Holy Prophet (p.b.u.h.) his noble wives and companions and to prevent the Quadiani or Lahori Group from misusing the epithets, descriptions and titles reserved for the said Holy personages or referring to or naming or calling their place of worship as "Masjid".
(d) Penal Code (XLV of 1860)‑‑
‑‑‑‑Ss. 298‑B & 298‑C‑‑‑"Masj id"‑‑‑Deception‑‑‑Creation of a Sharaee mosque is not to be proved for constituting an offence under S.298‑B(1)(d), ‑P.P.C. it is enough if by the words spoken or written or mere visible representation it is conveyed to others that the Quadianis' place of worship is Masjid‑‑‑If a person belonging to Quadiani or Lahori Group constructs a building, though squarish in shape or like a Christian Church, or a Hindu temple and names or calls same as "Masjid", he would be guilty under S.298‑B(1)(d), P.P.C.‑‑‑Naming a place showing visible representation of Masjid as Baitul Ahmadia, would also, prima facie, fall within the mischief of S.298‑B(1)(d), P.P.C.
The creation of a Sharaee mosque is not to be proved for constituting an offence under section 298‑B(1)(d) of the Pakistan Penal Code. It is enough if by words spoken or written or mere visible representation it is conveyed to others that the Quadianis' place of worship is "Masjid": The words "as Masjid" would mean, in the context, as if it was a Masjid. Therefore, if a person belonging to Quadiani or Lahori Group constructs a building, though squarish in shape or like a Christian Church, or a Hindu Temple and names or calls it as "Masjid" he would be guilty under section 298‑B(1)(d), P.P.C. Conversely, if he constructs or gets the building constructed like a traditional Muslim mosque, prima facie, it would be a visible representation showing that it is a "Masjid".
Naming such a place as Baitul Ahmadia would, prima facie, fall within the mischief of section 298‑B(1)(d) of the P.P.C.
Notwithstanding the writing of the words "Bait-ul-Ahmadia" atop , the main entrance of the ‑building, the possibility of deception to Muslim community .will remain there because the illiterate persons/Muslims will not be able to read with said words and others, though literate may not advert to or understand the true import of the writing and mistakenly enter the place and offer prayers behind a non‑Muslim Ouadiani Imam. Moreover, the writing can be washed out or removed at any time or may fade away with‑the passage of time. Prima facie, the offence is also covered under section 298‑C of the P.P.C. because the act of construction of the building like a traditional Muslim mosque by non‑Muslims has injured the feelings of Muslims. Accused brings Quadiani preachers in the disputed building and throws challenge of debate or "Munazera" to Muslims: Hence, prima facie, reasonable grounds are made out for believing that the accused has .committed an offence under sections 298‑B and 298‑C of the P.P.C.
(e) Penal Code (XLV of 1860)‑‑
‑‑‑Ss. 298‑B &_ 298‑C‑‑‑Anti‑Terrorism Act (XXVII of 1997), S.6‑‑Applicability of S.6, Anti‑Terrorism Act, 1997‑‑‑Scope‑‑‑Effect contemplated under S.6(b) of the Anti‑Terrorism Act, 1,997 must be relatable to a scheduled offence‑‑‑Offence committed under Ss.298‑B & 298‑C, P.P.C. being not scheduled offences, provision of S.6, Anti‑Terrorism Act, 1997 was not applicable.
Section 6 of the Anti‑Terrorism Act, 1997 applies where no act is done to strike terror or creates a sense of fear and insecurity in the people or any section of the people or to alienate any section of people or to adversely affect harmony among different sections of the people by using bombs, dynamite or other explosive or inflammable substances or "notified" fire‑arms or other lethal weapons etc. in such a manner as to cause or be likely to cause the death or injury to any person or damage to property on a large scale or wide‑spread disruption of supplies of essential services of life or to threaten with the use of force public servants to prevent them from discharging their lawful duties or commits a scheduled offence the effect of which will be or likely to be, to strike terror or create a sense of fear and insecurity in the people or any section of the people or to adversely affect harmony among different sections of the people.
The effect contemplated under section 6(b) of the Act must be relatable to a scheduled offence and sections 298‑B and 298‑C are not included in the "Schedule" of the Act.
(f) Penal Code (XLV of 1860)‑‑
‑‑‑‑S. 29.8‑B‑‑‑Masjid‑‑‑Sacred institution of Muslims‑‑‑Deception‑‑‑If a building is constructed according to the common and familiar design of a Masjid, and persons, congregate and pray in the manner of Muslims then it can be thought that they are Muslims ‑‑‑Quadianis, in order to avoid deception to Muslim community, are prohibited under 5.298‑B, P.P.C. from misusing certain epithets reserved for the highly reverend personages, announcing call for prayers through Azans or calling their place of a worship a mosque or 'Masjid.
Masjid or mosque is a highly important and sacred. institution of Muslims. Every mosque is house of Allah where the name of Almighty Allah is glorified and where Muslims offer their prayers. The Holy Ka'aba located at the Holy City of Makkah is, referred to in the Holy Qur'an as house of Allah and all other mosques are considered as daughters of Holy Ka'aba and also called houses of Allah which have to be carefully maintained and respected like other, symbols of Islam. The non‑Muslims cannot be allowed to adopt symbol of Islam without amending their faith and converting to Islam. If a building is constructed according to the common and familiar design of a "Musjid" and persons. congregate and pray in the manner of Muslims then it can be thought that they are Muslims. In order to avoid deception to Muslim community Qadianis are prohibited under section 298‑B of the P.P1C. from misusing certain epithets reserved for the highly reverend personages, announcing call for prayers through Azan or calling their place of worship as "Masjid". Insistence on the part of the Qadianis and their community to use prohibited eipithers and leaves no manner of doubt that they want to do so intentionally and it may amount not only to defiling those pious presonages but also deceiving others; that if their religious community insists on deception as its fundamental right and wants assistance of Courts in doing the same then God help, it. Consequently they (the persons belonging to ‑Qadiani or Lahori Group) have no right to use the epithets etc. and the Shaa'ir‑e‑Islam, which are exclusive to Muslims and they have been rightly denied their use by law. Their use of the "Shaa'ir‑e‑Islam etc., thus amounts to either posing as Muslims or to deceive others or to ridicule.
Zaheer‑ud‑Din's case 1993 SCMR 1718 fol.
(g) Anti‑Islamic Activities of Qadiani Group, Lahori Group and Ahmadis (Prohibition and Punishment) Ordinance (XX of 1984)‑‑
‑‑‑‑Preamble‑‑‑Constitution of Pakistan (1973), Arts.260(3)(b), 4, 20 & 25‑‑Right of individuals to be dealt with in accordance with law‑‑‑Freedom to profess religions‑‑‑Equality of citizens‑‑‑Provisions of Anti‑Islamic Activities of Qadiani Group, Lahori Group and Ahmadis (Prohibition and Punishment) Ordinance, 1984 give the actual epithets, the descriptions and also, titles and other requirements sought to be protected or imposed which cannot be used for entities or situations other than those for whom they have been prescribed‑‑‑Legislation, in any way does not interfere with the religions freedom of the Ahmadis, for same only prohibits them from using said epithets etc. on which they have no claim of any nature and does not prohibit them from coining their own‑‑ ‑Ahmadis like other minorities‑ are free to profess their religion and no one can take away, that right of theirs either by legislation or by executive orders ‑‑‑Ahmadis, however, are obliged to honour the Constitution and the law and should neither desecrate or defile the pious personage of any other religion including Islam, nor should they use their exclusive epithets, descriptions and titles and also avoid using the exclusive names like mosque and practice like Azan so that the feelings of the Muslim community are not injured and the people are not misled or deceived as regards the faith.
Anti‑Islamic Activities of Qadiani Group, Lahori Group and Ahmadis (Prohibition and Punishment) Ordinance, 1984 gives the actual epithets, the descriptions and also titles and other requirements sought to be protected or imposed. It is also stated that they cannot be used for entities or situations other than those for which they have been prescribed. The Ahmadis have been desecrating them and using them for their own leaders and practices etc., to deceive the people that they are also of the same type, status and the calibre. This practice not only deceived innocent, simple and not‑wall‑informed people but also created law and order situation throughout the period. The .legislation was, therefore, necessary, which in any way does not interfere with the religious freedom of the Ahmadis; for it. only prohibits them from using those epithets etc., on which they have no claim of any nature. It does not prohibit them from coining their own.
The Ahmadis like other minorities are free to profess their religion in the country and no one can take away that right of theirs either by legislation or by executive orders. They must, however, honour the Constitution and the law and should neither desecrate or defile the pious personages of any other religion including Islam, nor should they use their exclusive epithets, descriptions and titles and also avoid using the exclusive name like mosque and practice like "Azan" so that the feelings of the Muslim community are not injured and the people are not misled or deceived as regards the faith.
Zaheer‑ud‑Din's case 1993 SCMR 1718 fol.
(h) Islamic Jurisprudence‑‑
‑‑‑‑Mosque‑‑‑Construction of Mehrab in a mosque is not "Bidaa" or prohibited under Islamic Law.
(ALAM ALARANIAB FI BIDAT UL ALHARAIB) by Allama Jalal‑ud‑Din Sayuti and Fatawa Darul Uloom Deoband,Vo1.2,.p.779 ref.
(i) Penal Code (XLV of 1860)‑‑‑
‑‑‑‑S. 298‑B‑‑‑Masjid‑‑‑Deception‑‑‑If the structure of the building used by Qadianis as their place of worship resembles with that of a Muslim mosque, Qur'anic verses are inscribed on its walls or atop the arches and additionally prayers are offered in the manner of Muslims then Muslims are likely to be misled‑‑‑Possibility of deception to Muslims, therefore, exists even if Qadianis do not conceal the identity of their place of worship‑‑‑Fact that, to avoid deception, words "BAITUL AHMADIA" had been written over the main entrance of the disputed building, would not altogether obviate possibility of deception to Muslims because illiterate persons could not read the said words and yet others may not either notice the same or understand the true import of words so written‑‑‑Very construction of the disputed building like a Muslim mosque, prima facie, makes out the offence in circumstances‑[Muhammad Aslam v. The State 1998 PCr.LJ 522 dissented from].
Muhammad Aslam v. The State 1998 PCr.LJ 522 dissented from.
Nasir Ahmad v. The State 1993 SCMR 153 distinguished.
(j) Penal Code (XLV of 1860)‑‑
‑‑‑‑Ss. 298‑B & 298‑C‑‑‑Criminal Procedure Code (V of 1898), S.497‑‑Ball ‑‑‑Construction of building by accused, a Qadiani, like a Muslim mosque as "Ibadat Gah" or place of worship for Qadianis‑‑‑Offence, being a continuing 'offence, accused refused to change or modify the apparently offending structure of the building in question‑‑‑Case of accused, in circumstances, did not involve commission of an ordinary offence against one or more individuals but was an exceptional case involving commission of an offence against the Society ‑as a whole which may have national as well as international repercussions‑‑‑Offences under Ss.298‑B & 298‑C, P.P.C., though did not fall within prohibitory clause of S.497, Cr.P.C., but such fact alone would not entitle the accused to claim bail as of right‑‑‑Act of constructing a building as place of worship like Muslim mosque by Qadiani had outraged the religious feelings of the Muslims and serious law and order situation might be created if the accused was released on bail‑‑‑Nature of offence being a continuing one, accused's own conduct, the peace and tranquillity of the society and accused's personal safety having been kept in view, High Court declined bail to accused with direction to the Trial Court to conclude the trial expeditiously preferably within a period of three months ‑‑‑[Muhammad Aslam v. The State 1998 PCr. LJ 522 dissented from].
Muhammad Aslam v. The State 1998 PCr.LJ 522 dissented from: ‑
Nasir Ahmad v. The State. 1993 SCMR 153 and Muhammad Afzal and another v. The State 1997 SCMR 278 distinguished.
Asghar Masih and another v. The State 1995 PCr.LJ 544; Sikandar A. Karim v. The State 1995 SCMR 387; Syed Ahmad Ali Rizvi and others v. The State PLD 1995 SC 500; Muhammad Azad Khan v. The State 1988 PCr.LJ 1245; The State v. Muhammad Nazir and, others PLD 1991 Lah. 433; Tariq Bashir and 5 others v. The State PLD 1995 SC 34; Muhammad Afzal and another v. The State 1997 SCMR 278; Imtiaz Ahmad and another v. The State PLD 1997 SC 545; Kanwar Khalid Younus and another v. The State PLD 1995 Kar. 347; Pir Bakhsh and 4 others v. The State 1999 PCr.LJ 111; Muhammad Saeed v. The State PLD 1999 Kar. 345; Muhammad Iqbal v. The State PLD 1963 (W.P.) Lah. 279; Tariq Bashir and 5 others v. The State PLD 1995 SC 34; Barkat Ali v. The State 1996 SCMR 1956 and Mahmood Ahmad and others v. The State 1995 SCMR 1242 ref. Rana Sardar Ahmad for Petitioner.
A.R. Tayyab, Muhammad Akhtar Qureshi, Shabbir Ahmad Bhutta and Ghulam Rasool for the Complainant.
Saleem Nawaz Abbasi, A.A.‑G. assisted by Aslam Rashdi for the State.
Bilal Ahmad Qazi and Haq Nawaz Qamar : Amicus curiae.
Maulana Aziz‑ur‑Rehman Amicus curiae.
P L D 2000 Lahore 385
Before Muhammad Akhtar Shabbir, J
SALEEM AKHTAR‑‑‑Petitioner
Versus
NISAR AHMAD‑‑‑Respondent
Civil Revision No. 869‑D of 1990, heard on 28th January, 2000.
(a) Limitation Act (IX of 1908)‑‑‑
‑‑‑‑Art. 120‑‑‑Specific Relief Act (I of 1877), S.42‑‑‑Suit for declaration‑‑Limitation‑‑‑Expression "right to sue"‑‑‑Applicability‑‑‑Limitation for filing a suit for declaration under Art. 120, Limitation Act, 1908 is six years from the date of right to sue‑‑‑Right to sue accrues to plaintiff when his right has been denied by the defendant‑‑‑Such right of plaintiff is a continuous right and there can be no right to sue until there is an accrual of right asserted in the suit and its infringement or its clear unequivocal threat to infringe that right by defendant against whom the suit is instituted.
(b) Specific Relief Act (I of 1877)‑‑‑
‑‑‑‑S.42‑‑‑West Pakistan Land Revenue Act (XVII of 1967), S.42‑‑‑Suit for declaration‑‑‑Entries in record of rights‑‑‑Validity‑‑‑Such entries did not necessarily extinguish rights of the party against whom such entry had been made‑‑‑Every entry in the record of rights was denial of right of plaintiff and the plaintiff had the option to file suit for declaration on every denial of his rights,‑‑Such denial of rights would furnish the plaintiff a fresh cause of action.
Wali and 10 others v. Akbar and 5 others 1995 SCMR 284; Atta Muhammad v. Nasiruddin PLD 1993 Pesh. 127 and Muhammad Yousaf v. Noor Din and others 1993 MLD .763 ref.
(c) Transfer of Property Act (IV of 1882)‑‑‑
‑‑‑‑S. 54‑‑‑Sale‑‑‑Proof‑‑‑Onus to prove‑‑‑Onus to prove validity of sale is on the person in whose favour the sale has been effected.
Ghulam Haider v. Mst. Sooban Bibi 1986 MLD 1952 and Ghulam Hussain and others v. Inam Bakhsh and others 1995 MLD 1165 ref.
(d) Qanun‑e‑Shahadat (10 of 1984)‑‑‑
‑‑‑‑Art. 103‑‑‑Evidence‑‑‑Oral evidence does not exclude documentary evidence‑‑‑Document can be rebutted by document only.
Arif Baig v. Mubarrak Ali P1.D 1992 Lah. 366 ref..
(e) Transfer of Property Act (IV of 1882)‑‑‑
‑‑‑‑S. 54‑‑‑Sale‑‑‑Essentials of "sale" are the parties; the subject‑matter, the transfer of conveyance and the price or consideration.
(f) Transfer of Property Act (IV of 1882)‑‑‑
‑‑‑S. 54‑‑‑Parties to sale‑‑‑Parties of sale are the seller and the buyer‑‑‑Seller must be a person competent to transfer and contract and must have title to property or authority to transfer the same, if it is not his own.
(g) Transfer of Property Act (IV of 1882)‑‑‑
‑‑‑‑S. 54‑‑‑Valid sale‑‑‑Any of the ingredients of sale missing‑‑‑Effect‑.‑‑Such sale would not be a valid sale in the eyes of law.
(h) Civil Procedure Code (V of 1908)‑‑
‑‑‑‑S. 115‑‑‑Revision‑‑‑Finding of fact by Court of Appeal‑‑‑Value‑‑‑Trial Court decreed the .suit of the petitioner while Lower Appellate Court reversed the findings and dismissed the suit‑‑‑Validity‑‑‑Each and every finding of fact by Court of Appeal was not' wholly sacrosanct‑‑‑Where record was missing or grossly wrong inference was .raised from same or scant evidence was on record to support a finding, the Court in revision could competently review such findings of fact recorded by the Lower Appellate Court‑‑‑Judgment and decree passed by the Lower Appellate Court was set aside in circumstances.
Wazir Muhammad v. Muhammad Hussain 1993 CLC 1585 rel.
Mian Muhammad Jamal for Petitioner.
Ch.Ayyaz Muhammad Khan for Respondent.
Date of hearing: 28th January, 2000.
P L D 2000 Lahore 391
Before Amir Alam Khan, J
HABIB CREDIT AND EXCHANGE BANK LTD.‑‑Petitioner
Versus
HAMALIYA TEXTILE MILLS (PVT.) LTD., SHEIKHUPURA ROAD through Chief Executive
and others‑‑‑Respondents
Civil Miscellaneous Nos.2367‑L and 2368‑L of 1999 in Civil Original. No. 14 of 1996, decided on 19th February, 2000.
(a) Companies Ordinance (XLVII of 1984)‑‑‑
‑‑‑‑S. 333‑‑‑Civil Procedure Code (V of 1908), O.XXI, R.94‑‑‑Sale of property by official liquidator pertaining to company under liquidation and execution of decree under O.XXI, R.94, C.P.C.‑‑‑Such sale and execution of decree under O.XXI, R.94, C.P.C. do not have nexus with each other as proceedings in winding up cannot be taken to be in the nature of proceedings in execution of decree‑‑‑No sale certificate is required to be issued in case of sale by Official Liquidator.
(b) Registration Act (XVI of 1908)‑‑‑
‑‑‑‑S. 2(6)‑‑‑Expression "attached to earth"‑‑‑Connotation‑‑‑Movable property may become immovable property by its being attached to earth while it may not become immovable property when it is dealt with apart from land‑‑‑Rule that the machinery attached to or embedded in earth should always be treated as immovable property, is not an absolute rule, therefore, intention of a person dealing with the machinery is to be gathered from case to case.
Muhammad Ibrahim v. Northern Circars Fibre Trading Co. Coconada AIR 1944 Mad. 492 ref.
(c) Registration Act (XVI of 1908)‑‑‑
‑‑‑‑S. 2(6)‑‑‑Machinery, whether an immovable property‑‑‑Such question in each case depends upon the proof as to whether the machinery has been dealt with apart from land and building and that what is attached with earth is for the permanent beneficial enjoyment of the building or the attachment is merely for the beneficial enjoyment of the chattel itself.
(d) Companies Ordinance (XLVII of 1984)‑‑‑
‑‑‑‑S. 333‑‑‑Registration Act (XVI ‑of 1908), Ss.2(6) & 18‑‑‑Affixing of stamp duty on sale receipt issued by Official Liquidator as a result of auction of property owned by company under winding up‑‑‑Contention of purchaser was that since machinery was separately assessed therefore, it was exempted from the stamp duty‑‑‑Validity‑‑‑When order of winding up of the company had been passed; land, building and machinery had been separately assessed and offered and offer had been approved by the Company Judge‑‑‑Intention of the Official Liquidator as also that of the purchaser of the machinery would matter to determine question as to exemption from stamp duty‑‑Machinery being movable, could be sold to the purchaser under a receipt duly executed under law‑‑‑Stamp duty was not required to be affixed on the price paid for machinery in circumstances.
(e) Companies Ordinance (XLVII of 1984)‑‑‑
‑‑‑‑Ss. 355 & 479‑‑‑Civil Procedure Code (V of 1908), O.XXI, R.94‑‑Registratibn Act (XVI of 1908), S.18‑‑‑Sale certificate, issuance of‑‑Company Judge, whether acting as Civil Court for purpose of issuance of sale certificate‑‑‑No sale certificate was required to be issued to a purchaser who had purchased assets of company under liquidation‑‑‑Orders passed under Ss.355 & 479 of Companies Ordinance, 1984, were not to be enforced in the manner as a decree made by the Court in a suit, therefore, provision of O.XXI, C.P.C. was not applicable in execution of such orders.
Ch. Muhammad Azam Cheema v. Province of Punjab and others 1997 CLC 970; Brother Steel Mills Ltd. and others v. Mian Ilyas Miraj and 14 others PLD 1996 SC 543; Mian Ejaz Siddiqui and others v. Mst. Kaneez Begum and 2 others 1.992 CLC 1658; Eastern Company (Pvt.) Ltd., Lahore and 2 others v. Mst. Gul Begum and 7 others PLD 1980 Lah. 69; Ahmad Khan v. The Chief Justice and the Judges of the‑High Court, West Pakistan through the Registrar, High Court of West Pakistan, Lahore and others PLD 1968 SC 171; Sarbaz Cement Ltd. through Manager v. Bankers Equity Ltd. and 6 others 1996 SCMR 88; Mian Saleem‑ud‑Din and others v. MAJ. Jameel Akhtar Pervaiz and others 1998 SCMR 1717; N. Babu Jarrardhanam v. Golden Filiris.(P) Ltd. and another (1993) 73 ICC 455; Syndicate Bank v. Field Star Lyde Industries P. Ltd. and another (1995) 83 ICC 687; Specialty Traders v. Firdous Textile Mills Ltd. 1987 CLC 2109; Abdul Qayyum Khan v. Government of Punjab and others PLD 1995 Lah. 205; Lokashan Jain Udyog Mandir Ltd. v. Kalooram and another AIR 1965 Raj. 15 and (Bakhshi) Ghazanfar Ali v. (Bakhshi) Muzaffar Ali AIR 1936 Lah. 511 ref.
Ali Zafar for Petitioner.
Iftikhar Ahmed Sipra, N.H. Taskeen, M.S. Baqir, Faisal Islam, M. Salman Sehgal, Tariq Shamim, M. Akram Raja, Sh. Shahid Waheed, Qaiser Javaid Mian for Respondents.
Date of hearing: 19th February, 2000.
P L D 2000 Lahore 405
Present: Sheikh Abdur Razzaq and Zafar Pasha Chaudhry, JJ
MUHAMMAD BANARAS and others‑‑‑Appellants
Versus
STATE‑‑‑Respondent
Criminal. Appeals Nos.70 and 195 and Criminal Revision No.74 of 1991, decided on 7th March, 2000.
(a) Penal Code (XLV of 1860)‑‑‑
‑‑‑‑S. 302/34‑‑‑Appreciation of evidence‑‑‑Eye‑witnesses did not appear to have seen the occurrence‑‑‑Ocular testimony was belied by medical evidence‑‑‑Witnesses were not only related to the deceased but admittedly were inimical towards the accused and their testimony which was neither reasonable nor convincing was not corroborated by any credible evidence‑‑Prosecution had tried to widen the net and come forward with an exaggerated version mixing innocent persons with the guilty‑‑‑Picking up of real culprits from amongst the number of accused was not ,possible‑‑‑Recoveries of weapons of offence being inconsequential‑, the eye‑witness account was not even supported by circumstantial evidence‑‑‑Motive as alleged by the prosecution also did not lend any support to its story‑‑‑Accused were acquitted in circumstances.
Tawab Khan v. The State PLD 1970 SC 13 ref.
(b) Penal Code (XLV of 1860)‑‑‑
‑‑‑‑S. 302/34‑‑‑Appreciation of evidence‑‑‑Sifting grain from the chaff‑‑Principle‑‑‑Benefit of doubt‑‑‑When Court arrives at a conclusion that some accused persons amongst the various accused named by the prosecution witnesses did commit the crime, they may be convicted irrespective of the fact that the prosecution witnesses have been disbelieved qua their coaccused‑‑‑Such rule stands enforced and is being followed so that justice may be administered and guilty .persons may not escape punishment as far as possible‑‑‑Where, however, it becomes difficult to pick up or to ascertain the real culprit amongst the number of accused, then there is no escape from the principle that benefit of doubt has to be extended to all the accused persons.
Tawab Khan v. The State PLD 1970 SC 13 ref.
Sardar Muhammad Ishaque for Appellants.
Raja Muhammad Ayub Kiani for the State.
Malik Muhammad Nawaz for the Complainant:
Dates of hearing: 6th and 7th March, 2000.
P L D 2000 Lahore 414
Before Malik Muhammad Qayyum, J
AYAZ DURRANI and others‑‑‑Petitioners
Versus
CHAIRMAN, WAPDA and others‑‑‑Respondents
Writ Petitions Nos. 10467, 1575 of 1999 and 1363 of 2000, decided on 5th April, 2000.
Companies Ordinance (XLVII of 1984)‑‑‑
‑‑‑‑Ss. 2(7) & 196‑‑‑Constitution of Pakistan ‑(1973), Art. 199‑‑Constitutional petition‑‑‑Company incorporated under Companies Ordinance, 1984‑‑‑Status‑‑‑Detention of Chief Executive of a company for recovery of any liability of the company‑‑‑Contention was that liability was on the company incorporated and the Chief Executive had no personal liability‑‑Validity‑‑‑Contention of petitioner was in accord with law‑‑‑Company incorporated under Companies Ordinance, 1984, was a separate and distinct juristic person quite apart from the Chief Executive, Director or shareholders‑‑‑Liability of such a company could not fall upon the Directors or the shareholders who had no personal liability for the same‑‑‑Action of recovering the disputed amount from the Chief Executive was without lawful authority and of no legal effect‑‑‑Petition was allowed accordingly.
Tariq Saeed Saigol v. The District and Taxation Officer 1982 CLC 2387; Muhammad Anwar Khan Tiwana v. Mst. Sadeeqa Begum and 4 others PLD 1984 Lah. 411 and Shamim‑ud‑Din v. Federal Government of Pakistan through Chairman, WAPDA, Lahore and 4 others 1995 CLC 299 ref.
Imtiaz R. Siddiqui for Petitioners.
Iqbal Mahmud Malik for Respondents
Date of hearing: 5th April, 2000.
P L D 2000 Lahore 415
Before Malik Muhammad Qayyum and Syed Zahid Hussain, JJ
GOVERNMENT OF PAKISTAN through Secretary, Establishment Division, Islamabad‑‑‑Appellant
Versus
ZAMIR AHMED SHEIKH‑‑‑Respondent
Intra‑Court Appeal No.657 in Writ Petition No.9175 of 1999, decided on 22nd March, 2000.
Transfer of Railways Order [P.O. 33 of 1962]‑‑
‑‑‑‑Art. 3 [as amended. by Transfer of Railways (Amendment) Ordinance (I of 1998)]‑‑‑Law Reforms Ordinance (XII of 1972), S.3‑‑‑Intra‑Court Appeal‑‑‑Interpretation of Art.3 of Transfer of Railways Order, 1962‑‑Constitution of Railways Board‑‑‑Single Judge of High Court while accepting Constitutional petition filed by respondent formed a view that Chairman of the Railways Board was to be appointed as member and only then he could be appointed as Chairman‑‑‑Validity‑‑‑Secretary to Government of Pakistan, Railways Division under Art.3 of Transfer of Railways Order, 1962 was ex officio Chairman of the Board and five members had to be appointed by the Federal Government‑‑‑Interpretation placed by the Single Judge being not the intent of law, Chairman of the Board was not necessarily to be a member of the Board‑‑‑Order of Single Judge of High Court was set aside.
Kh. Saeed‑uz‑Zafar, Dy. A.‑G. for Appellant.
Hafiz Tariq Nasim for Respondent.
Date of hearing: 22nd March, 2000.
P L D 2000 Lahore 418
Before Malik Muhammad Qayyum, J
ALI TEXTILE (JHANG) LIMITED‑‑‑Petitioner
Versus
GOVERNMENT OF PAKISTAN in the Ministry of Commerce, Department of Insurance, Pak Secretariat, Islamabad and 3 others‑‑‑Respondents
Writ Petition No. 17185 of 1999, decided on 9th March, 2000
(a) Insurance Act (IV of 1938)‑‑‑
‑‑‑‑S. 33‑‑‑Entertaining and adjudicating upon claim of insured‑‑‑Power of Controller of insurance‑‑‑Scope‑‑‑Only power which the Controller has under 5.33 of Insurance Act, 1938 is to investigate into the affairs of an insurance company and to take such action as may be required after giving an opportunity to the insured to make representation in writing or to be heard in person‑‑‑No power vests in the Controller whereby claim of insured against insurance company can be entertained or adjudicated upon.
(b) Insurance Act (IV of 1938)‑‑
‑‑‑‑S. 47‑L‑‑‑Constitution of Pakistan (1973), Art.199‑‑‑Constitutional petition‑‑‑Claim of insured‑‑‑Order of Controller of Insurance expressing lack of his jurisdiction to entertain and adjudicate upon the claim of the insured and observing that Claim Settlement Board was authorised to adjudicate in the matter‑‑‑Validity‑‑‑Federal Government vide Notification dated 27‑8‑1990 had authorised the Board to adjudicate upon the claims and disputes arising under an insurance policy‑‑‑Controller of Insurance, thus, was justified in observing that the insured should have resorted to Claim Settlement Board‑‑‑Board was directed by High Court to dispose of the petition of the insured.
Dr. A. Basit for petitioner.
M. Saleem Sehgal for Respondent No.3.
Ch. Maqsood Ahmad for Respondent No.4
P L D 2000 Lahore 421
Before Riaz Kayani, J
MUHAMMAD YAQOOB‑‑‑Petitioner
versus
SENIOR SUPERINTENDENT OF POLICE, GUJRANWALA and 2 others‑‑‑Respondents
Writ Petition No. 13004 of 1999, heard on 2nd March, 2000.
(a) Penal Code (XLV of 1860)‑‑‑
‑‑‑‑S. 408‑‑‑Constitution of Pakistan (1973), Art.199‑‑‑Constitutional petition‑‑‑Quashing of F. I. R. ‑‑‑Complainant, according to F.I.R., being a manufacturer of motors used in washing machines had appointed the accused as his salesmen with whom a legal contract was entered into that they would sell the motors in the market and after retaining their commission they would return the profit to the complainant‑‑‑Said motors was a trust property and by delivering the same to the accused a fiduciary relationship had come into existence between the complainant and the accused‑‑‑Violation of the contract by the accused, according to the allegations, had constituted the dishonest intention on the part of the accused and a prima facie case of criminal breach of trust was‑ made out‑‑‑Accused, therefore, were not entitled to the extraordinary Constitutional relief‑‑‑Constitutional petition was dismissed accordingly.
(b) Penal Code (XLV of 1860)‑‑‑
‑‑‑‑S. 408‑‑‑Constitution of Pakistan (1973), Art.199‑‑‑Constitutional petition‑‑‑Quashing of F. I. R.‑‑‑Principle‑‑‑Quashing of F.I.R. in its inception only requires the examination of its contents‑‑‑If a case is made out, the trial should ordinarily be allowed to proceed, but on the other hand even if contents of the F.I.R. are admitted and conviction is not likely to ensue then the proceedings are termed as abuse of process of law and Courts would step in to stem such abuse.
(c) Penal Code (XLV of 1860)‑‑‑
‑‑‑‑S. 405‑‑‑Criminal breach of trust‑‑‑Essential ingredients to constitute an offence enumerated.
From the bare reading of the definition of the' criminal breach of trust, following ingredients are essential to constitute an offence:‑‑
(a) There should be an entrustment by a person who reposes confidence in the other, to whom property is entrusted.
{b) The person in whom the confidence is placed, dishonestly misappropriates or converts to his own use, the property entrusted.
(c) Dishonestly uses or disposes of that property in violation of any direction of law prescribing the mode in which such trust is to be discharged.
(d) Dishonestly uses or disposes of that property in violation of any legal contract, express or implied which he has made touching the discharge of such trust.
Ali Ahmad Awan for Petitioner.
Nasim Sabir Ch., Addl. A.‑G. with. Khalid Mahmood Faruki for Respondents Nos. l and 2.
M. Ahsan Bhoon for Respondent No.3
Date of hearing: 2nd March, 2000
P L D 2000 Lahore 425
Before Asif Saeed Khan Khosa, J
MUNIR AHMAD‑‑‑Appellant
versus
THE STATE‑‑‑Respondent.
Criminal Appeal No. 1294 of 1999, heard on 20th March, 2000.
(a) Penal Code (XLV of 1860)‑‑‑
‑‑‑‑S. 318‑‑‑Qatl‑e‑Khata‑‑‑Scope‑‑‑Provision of S.318, P.P.C. would be attracted in case of a deliberate act on the part‑of accused person to do one thing but because of a mistake of act or of fact the end result of such an act was different from that intended by the accused person.
(b) Penal Code (XLV of 1860)‑‑‑
‑‑‑‑Ss. 318, 319 & 80‑‑‑Appreciation of evidence ‑‑‑Qatl‑e‑Khata‑‑‑Accused was charged and convicted under S.319, P.P.C. for causing death by accidental firing‑‑Accused had neither used his rifle nor had fired any shot therefrom by design or with intention to do so‑‑‑Where Trial Court admitted that the rifle had gone off accidentally, Court was not justified in invoking the provisions of S.319, P.P.C. against the accused as his case was fully covered by provisions of S.80, P.P.C.‑‑‑Nothing was available on record to show that accused had not used proper care and caution in that regard‑‑Sentence and conviction passed by Trial Court were set aside.
(c) Penal Code (XLV of 1860)‑‑‑
‑‑‑‑S. 80‑‑‑Act committed by accident or misfortune‑‑‑Effect‑‑‑Such an act does not constitute any offence at all.
Muhammad. Ahsan Bhoon for Appellant.
Muhammad Naseem Sabir, Addl. A.‑G. for the State.
Date of hearing: 20th March, 2000.
P L D 2000 Lahore 428
Mrs. Fakhar‑un‑Nisa Khokhar, J
ABDUL GHANI‑‑‑Petitioner
versus
MUHAMMAD LATIF‑‑‑Respondent
Civil Revision No. 1203‑D of 1998, decided on 3rd April, 2000..
(a) Punjab Pre‑emption Act (IX of 1991)‑‑
‑‑‑‑S. 13‑‑‑Pre‑emption right, exercise of ‑‑‑Talb‑e‑Muwathibat‑‑ Requirement‑‑‑Pre‑emption right cannot be exercised unless the pre‑emptor has performed ceremony of Talb‑e‑Muwathibat immediately on hearing of the sale‑‑‑Plaintiff in every way has to prove that he had made such demand before filing of pre‑emption suit‑‑‑If the plaintiff fails to do so the right of pre‑emption extinguishes.
Gul Hassan Shah v. Mulazim Hussain Shah 1995 SCMR 294; 1996 SCMR 294 and Muhammad Ramzan v. Lal Khan 1995 SCMR 1510 ref.
(b) Punjab Pre‑emption Act (IX of 1991)‑‑
‑‑‑‑S. 13‑‑‑"Talb‑e‑Muwathibat"‑‑‑Meaning‑‑‑Talb‑e‑Muwathibat is a demand of, jumping, by which a pre‑emptor has to make immediate assertion of his right on getting information of transfer of property‑‑‑Right of preemption must be asserted with utmost promptitude.
Muhammad Sarwar v. Ashiq Ali PLD 1995 Lah. 133 ref.
(c) Punjab Pre‑emption Act (IX of 1991)‑‑
‑‑‑‑S. 13‑‑‑Pre7emption right, exercise ‑of ‑‑‑Pre‑emptor should use some words to show that he intends to pre‑empt and is pre‑empting ‑‑‑Intention is always gathered from words and surrounding circumstances.
(d) Punjab Pre‑emption Act (IX of 1991)‑‑
‑‑‑‑S. 13‑‑‑Pre‑emption right, proof of‑‑‑Time within which three "Talbs" are made is great significance in pre‑emption matter in order to prove the claim.
(e) Punjab Pre‑emption Act (IX of 1991)‑‑
‑‑‑‑S. 13‑‑‑Pre‑emption suit‑‑‑Concurrent findings of fact by both the Courts below‑‑‑Failure to make "Talbs" in specified time‑‑‑Effect‑‑‑Where the preemptor failed to prove "Talbs" within time frame and manner under the provision of S.13(3) of Punjab Pre‑emption Act, 1991, and also failed to prove immediate assertion of his right on getting information of transfer of property through his evidence, judgments and decrees of both the Courts below were unexceptionable and‑were not interfered by High Court.
Amir Khan and 3 others v. Haji Ghulam Muhammad PLD 1997 SC 883; Haji Rana Muhammad Shabbir Ahmad Khan v. Government of Punjab Province, Lahore PLD 1994 SC 1; Abdul Malik v. Muhammad Latif 1999 SCMR 717; Muhammad Yunus Khan and another v. Muhammad Yusuf ILR (sic) All. 334; Jalal Din and another v. Nawab and others AIR 1941 Lah. 55; 1994 CLC 1774 and Manzoor Hussain Shah v. Fazal Dad and another 2000 SCMR 216 ref.
Taqi Ahmad Khan for Petitioner.
Ch. Siddique Ahmad for Respondent.
Dates of hearing: 14th and 22nd March, 2000.
P L D 2000 Lahore 433
Before Malik Muhammad Qayyum, J
Messrs LAHORE CABLES AND ENGINEERING (PVT.) LTD. ‑‑‑Petitioner
versus
GOVERNMENT OF PUNJAB and 5 others‑‑‑Respondents
Writ Petition No. 19491 of 1999, decided on 3rd April, 2000.
(a) Stamp Act (II of 1899)‑‑‑
‑‑‑‑S. 31‑‑Determination as to proper stamp duty‑‑‑Matter in dispute before the Collector was as to the validity or otherwise of the mutation sanctioned of which review was sought‑‑‑Question of deficiency or otherwise of the stamp duty on the sale‑deed was not the subject‑matter of the proceedings before the Collector‑‑‑If Collector wanted to take suo motu action on the question of deficiency in stamp duty he should have at least observed the minimum rule of. natural justice which was to serve a notice to show cause on the affected party before passing any order.
(b) Stamp Act (II of 1899)‑‑‑
‑‑‑‑S. 31‑‑‑Determination as to proper stamp duty‑‑‑Held, it was the document as it stood which was determinative of the duty payable and not the transaction‑‑‑Provisions of Stamp Act, 1899 did not deal with the bargain but the instrument which recorded the bargain.
Shamim Akhtar v. Najma Baqai PLD 1978 SC 7; The Corporation of Swadeshi Cotton Mills Company Limited AIR 1932 All. 291 and Nanak Chand v. Fattu AIR 1935 Lah. 567 ref.
(c) Stamp Act (II of 1899)‑‑‑
‑‑‑‑Ss. 31 & 42‑‑‑Determination as to proper stamp duty‑‑‑Predecessor of Collector, on application by the concerned party for determination of stamp duty on the deed, had found that there was deficiency in stamp duty which amount was deposited and as such determination of stamp duty on the deed attained finality under S.42, Stamp Act, 1899‑‑‑Successor in office of the Collector was .not competent to re‑open the matter or to review the order passed by his predecessor as the Stamp Act, 1899 did not vest any such power in the successor in office of Collector.
(d) Stamp Act (II of 1899)‑‑‑
‑‑‑‑Ss. 29 & 48‑‑‑Recovery of duties and penalties‑‑‑Agreement for sale provided that all costs and expenses on Government charges and duties in connection with execution and registration of the sale‑deed including the stamp duty shall be borne by the seller‑‑‑Liability to pay the evaded duty, if any, therefore, was that of the seller and could not be placed upon the buyer.
According to section 29, Stamp Act, 1899 in the absence of an agreement to the contrary the expense for providing the proper stamps in the case of conveyance has to be borne out by the grantee and granter in equal share. However, as the language itself indicates this provision is to apply in absence of any agreement to the contrary. In the present case agreement for sale provided that all costs and expenditure of Government charges and duties in connection with execution and registration of the sale‑deed including the stamp duty shall be borne by the seller. Therefore, the liability to pay the evaded duty was that of seller and could not be placed upon the buyer.
Section 48 of the Stamp Act, 1899 which provides for recovery of the dues has to be read alongwith section 29 of the Stamp Act and recovery can only be made from the person by whom the duty was payable and not by anyone else.
Hakim Muhammad Hussain v. Emperor AIR 1940 Lah. 315 ref.
(e) Stamp Act (II of 1899)‑‑‑
‑‑‑‑S. 48‑‑‑Penalty‑‑‑Law prohibits evasion of duty and not the avoidance of duty‑‑‑If a person by legitimate means can draft the document in such a manner‑so as to pay a lesser amount of duty the Court should not grudge the same‑‑‑While interpreting a fiscal law like Stamp Act, 1899 the doubt, if any, should be resolved in favour of the subject.
(f) Stamp Act (II of 1899)‑‑‑
‑‑‑‑Ss. 31, 48 & 56‑‑‑Constitution of Pakistan (1973), Art.199‑‑?Constitutional petition‑‑‑Maintainability‑‑‑No provision for appeal or revision having been provided in the Stamp Act, 1899 and remedy provided under S.56, Stamp Act, 1899 being not adequate and efficacious, Constitutional jurisdiction of High Court under Art. 199 of the Constitution could validly be invoked by aggrieved person.
There is no provision for appeal or revision in the Stamp Act and as such the Constitutional jurisdiction could validly be invoked.
Section 56 of the Stamp Act does not grant any right to any person to apply for revision but reference to the control of revenue authority. Furthermore, even if it be taken that section 56 confers the remedy of revision on the aggrieved person, that remedy is not adequate and efficacious.
Ghulam Farid v. The Board of Revenue PLD 1960 Lah. 211 and Mst. Hussain Bibi v. Haji Muhammad Din and others 1976 SCMR 395 ref.
Salman Khalid Cheema, Ihsan Ullah Jella and Ahmed Bilal Sheikh for Petitioner.
Ch. Muhammad Ashraf, A.A.‑G. for Respondents.
Date of hearing: 3rd‑March, 2000.
P L D 2000 Lahore 442
Before Iftikhar Hussain Chaudhry and Zafar Pasha Chaudhry, JJ
RASHID MAHMOOD‑‑‑Appellant
versus
THE STATE‑‑‑Respondent
Criminal Appeals Nos.705, 743 and‑Criminal Petition for Special Leave to Appeal No.32 of 1996, heard on 27th January, 2000.
(a) Penal Code (XLV of 1860)‑‑
‑‑‑‑S. 308‑‑‑Appreciation of evidence‑‑‑Trial Court had appraised evidence properly and rightly concluded the case having been proved by the prosecution against the accused‑‑‑Conviction of accused, therefore, was unexceptionable‑‑‑Accused was more than 14 years of age at the time of occurrence and the way in which he committed the murder by arming himself with a pistol showed that he had ‑attained sufficient maturity and fully realized the consequences of his act‑‑‑Vindication of family honour, however, being involved, the accused, a young boy, obsessed by disgrace and insult meted out to him and his family was prompted to commit murder‑‑‑Sentence of 14 years' R.I. awarded to accused was reduced to 10 years' R.I. in circumstances‑‑‑Sentence of accused to pay Diyat was upheld‑‑Order for payment of Rs.50,000 as compensation to the heirs of the deceased over and above the payment of Diyat was not called for and the same was set aside accordingly.
(b) Criminal Procedure Code (V of 1898)‑‑
‑‑‑‑S. 544‑A‑‑‑Penal Code (XLV of 1860), S.308‑‑‑Compensation for the heirs of the deceased not necessary if the accused was ordered to pay Diyat‑‑Where an offender has been ordered to pay Diyat the purpose of 5.544‑A, Cr.P.C. stands accomplished and no order for payment of compensation to the heirs of deceased is called for.
M. Anwar Bhinder for Appellant
A.H. Masood for the State.
M.A.Zafar for the Complainant
Date of hearing: 27th January, 2000.
P L D 2000 Lahore 449
Before Tassaduq Hussain Jilani and Nasim Sikandar, JJ
THE STATE‑‑‑Petitioner
versus
ABDUL MALIK alias MALKOO‑‑‑Respondent
Criminal Revision No. 16 of 2000, decided on 3rd February, 2000
(a) Offence of Zina (Enforcement of Hudood) Ordinance (VII of 1979)‑‑‑
‑‑‑‑S. 10(4)‑‑‑Anti‑Terrorism Act (XXVII of 1997), Preamble, Ss.6(c) & 7‑‑Object and purpose of enactment of Anti‑Terrorism Act, 1997‑‑‑"Heinous Offence"‑‑‑Nature‑‑‑Rape‑‑‑Victim, a child‑‑‑Jurisdiction of Special Court‑‑Anti‑Terrorism Act, 1997 was enacted for the prevention of terrorism, sectarian violation, for speedy trial of heinous offences and for matters connected therewith and incidental thereto‑‑‑Heinous offence was an offence which was wicked, atrocious, cruel and offensive‑‑‑Offence of raping a girl aged 6/7 years was an act which by all standards was cruel, wicked and offensive and could fall within ambit of expression "heinous offence" used in the preamble of Anti‑Terrorism Act, 1997 calling for extraordinary remedy in law‑‑‑Offence of raping girl of 6/7 years old was not only heinous but would also constitute a "terrorist act" as defined in S.6(c) of the said Act‑‑Rape of a minor girl of seven years would ordinarily lead to a sense of fear and insecurity as stipulated in S.6(c) of Anti‑Terrorism Act, 1997 and would fall within ambit of the Act.
(b) Anti‑Terrorism Act (XXVII of 1997)‑‑‑
‑‑‑‑Ss. 6 & 7‑‑‑Offence of Zina (Enforcement of Hudood) Ordinance (VII of 1979), S.10‑‑‑"Child molestation"‑‑‑Meaning‑‑‑Jurisdiction of Special Court to decide case of child molestation‑‑‑Scope‑‑‑Expression "child molestation" which had not been defined in any law in Pakistan, was some times used as synonymous to child abuse, but all acts of child abuse would not necessarily be "child molestation" ‑‑‑Sexual molestation of child could be of various types‑‑‑Such molestation could be fondling of genital organs of child or it could be showing him nude photographs‑to‑arouse his sexual emotions or it could be in form of physical nudity with the object of sexually provoking or exploiting a child‑‑‑Most of said acts had not been specially made offences in criminal law of Pakistan nor rape of a child had been separately catered for‑‑Rape of a child or "Zina‑bil‑Jabr" was, an aggravated form of child molestation and a person who was proved to have committed said offence, would be punished in terms of punishment provided in Offence of Zina (Enforcement of Hudood) Ordinance, 1979‑‑‑Offence of child rape, thus.
would be tried by a Special Court under the Anti‑Terrorism Act, 1997.
(c) Anti‑Terrorism Act (XXVII of 1997)‑‑‑ .
‑‑‑‑S. 6(c)‑‑‑Constitution of Pakistan (1973), Arts.19, 34 & 35‑‑‑Rights of child and responsibilities of the State and society with regard to child and family‑‑‑Islam had laid down special stress on welfare of family and child and also as a member of United Nations, it, was religious, moral and Constitutional duty of the State to bring required legislation and structural changes to honour the commitments to the rights of a child and the family‑‑Need was to suitably amend Penal Laws with a view to make certain acts/wrongs against children punishable and to give a new and a fair deal to the child‑‑‑Clause (c) of S.6 of Anti‑Terrorism Act, 1997 appears to have been drafted in haste and expression "child molestation" in its various connotations had not been defined and no punishment had been prescribed for other forms of child molestation‑‑‑High Court observed that Government should examine the desirability to take some affirmative action in the matter
(d) Words and phrases
‑‑‑‑‑‑ Child molestation "‑‑‑Meaning, Tahir Haider Wasti, A.A.‑G. for the State.
Nemo for Respondent.
Date of hearing: 3rd February, 2000.
P L D 2000 Lahore 458
Before Malik Muhammad Qayyum, J
MATCHLESS TOURS AND TRAVELS (PVT.) LTD. ‑‑‑Petitioner
versus
GOVERNMENT OF THE PUNJAB and another‑‑‑Respondents
Writ Petition No.4742 of 2000, decided on 28th April, 2000.
(a) Punjab Finance Act (IX of 1997)‑‑‑
‑‑‑‑S. 7‑‑‑Constitution of Pakistan (1973), Art. 199‑‑‑Constitutional petition‑‑‑Levy of tax on luxury vehicles registered not in the Province of Punjab but plying in Punjab Province‑‑‑Such levy is payable under S.7, Punjab Finance Act, 1997 only by a bona fide resident of the Province or by ;, those persons who are carrying on business or have an office within the territory of Punjab Province‑‑‑Vehicles which enter Province of Punjab temporarily or are in the transit, cannot be subjected to such levy.
(b) Punjab Finance Act (1X of 1997)‑‑‑
‑‑‑‑S. 7(1)‑‑‑Word "plying" as used in S.7(1), Punjab Finance Act. 1997‑‑Connotation‑‑‑ "Plying" implies the use of more or less on a regular basis and occasional use of vehicle is not covered by term "plying "‑‑‑Vehicle which is .:‑; registered outside Punjab Province and is brought into the Province for temporary use occasionally the same does not amount to "plying" the vehicle in the Province of Punjab‑‑‑Some sort of permanency attached to the use has to be there before it can be‑ said to "ply" in the Punjab Province.
(c) Words and phrases‑‑
‑‑‑‑"Plying"‑‑‑Meaning.
Webster's International Dictionary, 3rd Edn. and Collins Gem English Dictionary (Major New Edn.) ref.
Mahmood A. Sheikh for Petitioner. Ch. Muhammad Ashraf, A.A.‑G. for Respondents.
Date of hearing: 17th April, 2000.
P L D 2000 Lahore 461
Before Malik Muhammad Qayyum, J
PAKISTAN WAPDA and others‑‑‑Petitioners
versus
KOT ADDU POWER CO. LTD. ‑‑‑Respondent
Civil Original No. 1601‑L of 1998, heard on 12th April, 2000.
(a) Companies Ordinance (XLVII of 1984)‑‑
‑‑‑‑S. 290‑‑‑Indian Companies Act (I of 1956), Ss.397 & 398‑‑‑English Companies Act, 1989, S. 459‑‑‑Powers of Court to take corrective measures‑‑‑Scope‑‑‑Law applicable on the subject in India and England‑‑Comparison‑7‑Provision of S.290 of Companies Ordinance, 1984, vests the Court with wide and vast powers to take corrective measures by passing appropriate orders in the event that it is shown that the affairs of the company are being conducted or are likely to be conducted in unlawful or fraudulent manner or in a manner prejudicial to public interest or in a manner oppressive to the members or any of the members or creditors‑‑‑Such power is much wider than corresponding provisions in the repealed Companies Act, 1913, and Ss.397 & 398 of Indian Companies Act, 1956, in many respects‑‑Amplitude of powers conferred by S.290, Companies Ordinance, 1984 upon the Courts is unprecedented‑‑‑Neither under Indian Companies Act, 1950, nor English Companies Act, 1989, the Courts enjoy such wide jurisdiction‑‑Jurisdiction of the Courts in India and England is much narrower, the Courts have not shied away from extending their jurisdiction‑‑‑Where it is demonstrated that affairs of the company are being conducted in an unlawful or illegal manner or in a manner prejudicial to the public interest or oppressive to the members or creditors, the Court under S.290 of Companies Ordinance, 1984 can interfere.
Bennet Coleman & Co. v. Union of India (1977) 47 Com. Cas. 92 and Shahbazud Din v. Service Industries Textile Ltd. PLD 1988 Lah. 1 ref.
(b) Companies Ordinance (XLVII of 1984)‑‑
‑‑‑‑S. 290‑‑‑West Pakistan Water and Power Development Authority Act (XXX of 1958), S.8(2)(c)(vii)‑‑‑Privatization of power generation unit‑‑Power Purchase Agreement between the Authority and the companies‑‑‑ Interference with the agreement by High Court (Companies Judge) during proceedings under S.290, Companies Ordinance, 1984‑‑‑Contention by companies was that no interference could be made under the proceedings‑‑Validity‑‑‑Apart from being purchaser, the Authority was also a shareholder rather majority shareholder in the company‑‑‑Power Purchase Agreement was not to be read in isolation as the same was one of the series of agreements arrived at as a consequence of privatization‑‑‑Agreement itself referred to other agreements and also to various acts of management which were to be performed by the parties‑‑‑Contention of companies that the Power Purchase Agreement could not be interfered under S.290 of Companies Ordinance, 1984 was repelled having no merits.
(c) Companies Ordinance (XLVII of 1984)‑‑
‑‑‑‑S. 209‑‑‑Managing agents, institution of‑‑‑Institution of Managing Agents has been done away within Pakistan as far back as 1972 and is specifically prohibited by S.209 of Companies Ordinance, 1984.
(d) Companies Ordinance (XLVII of 1984)‑‑
‑‑‑‑S. 90‑‑‑Indian Companies Act (I of 1956)‑‑‑English Companies Act, 1989‑‑‑Voting power of each shareholder‑‑‑Corresponding provisions of English as well as Indian Company laws‑‑‑Comparison‑‑‑Voting power of each shareholder under S.90(2) of Companies Ordinance, 1984, must be equal to the paid value of his shares‑‑‑Provision of S.90 of Companies Ordinance, 1984, is departure from the previous law‑‑‑Law in England and India is different where different classes of shares are recognized‑‑‑Provision of Companies Ordinance, 1984 .provides only one class of share and every shareholder is given right to vote proportionately.
(e) Companies Ordinance (XLVII of 1984)‑‑
‑‑‑‑Ss. 90 & 290‑‑‑Right of vote‑‑‑Imposing of restriction on such right by an agreement‑‑‑Validity‑‑‑Petitioner Authority had majority shares in the company and no restriction could be placed on the right of the petitioner Authority to take any decision by voting in proportion to the shares held by it and petitioner Authority could not be prevented from exercising that right‑‑‑Agreement to the contrary was prima facie void.
(f) Companies Ordinance (XLVII of 1984)‑‑
‑‑‑‑Ss. 209 & 290‑‑‑Mismanagement of affairs of company‑‑‑Appointment of Managing Agents‑‑‑Power generation plant was privatized and handed over to the company for its operation‑‑‑Company hired one of its affiliated company for operation and maintenance of the plane‑‑‑Validity‑‑‑Such agreement was illegal as the same amounted to appointment of Managing Agent which had no place under the Companies Ordinance, 1984‑‑‑Hefty fee alongwith costs, expenditure and bonus was being paid to that affiliated company‑‑‑Where cost of maintenance which the contractor was charging was much more than the cost which other unit was incurring, the excessive payments constitute acts of mismanagement‑‑‑Management of the company was held to be mismanaging its affairs for its gains while oppressing the other shareholders in circumstances.
(g) Companies Ordinance (XLVII of 1984)‑‑
‑‑‑‑S. 290‑‑‑West Pakistan Water and Power Development Authority Act (XXXI of 1958), S.9(2)(c)(vii)‑‑‑Conducting affairs of company in a manner prejudicial to public interest‑‑‑Privatization of power generation unit‑‑Management and operation of the unit was handed over to the company‑‑Money received from the petitioner Authority by the company was a part of purchase price of electricity‑‑‑Company under operation and maintenance agreement was dishing out huge sums of money to one of its affiliates‑‑Money paid by the Authority belonged to the people and by siphoning away the funds, management of respondent company was conducting its affairs in a manner prejudicial to the public interest.
(h) Company‑‑
‑‑‑‑ Company should work not only for the benefit of its shareholders but also for general good of the community/public‑at‑large.
Shahbazud Din v. Service Industries Textile Ltd. PLD 1988 Lah. 1 and N.R. Murty v. I.D. Corpn. of Orissa Ltd. (1977) 47 Com. Cas. 389 ref.
(i) Companies Ordinance (XLVII of 1984)‑‑
‑‑‑‑S. 290‑‑‑Contract Act (IX of 1872), S.23‑‑‑Contracts opposed to public policy‑‑‑Misappropriation of public funds‑‑‑Petitioner (WAPDA) was a public sector organization utilizing the funds which belonged to the public‑‑Payments which the petitioner (WAPD:1) was forced to make under the agreements were in fact made from the money of public‑at‑large‑‑‑Effect‑‑Such agreements entered into between the parties, in addition to being against public interest were also opposed to public policy under the provisions of S.23 of Contract Act, 1872‑‑‑By making such agreements in the form of various agreements whereby the petitioner (WAPDA) was tied down to make undue payments, amounted to misappropriation of public funds in circumstances.
(j) Contract Act (IX of 1872)‑‑
‑‑‑‑S..23‑‑‑Expression "public policy" occurring in S.23, Contract Act, 1872‑‑‑Connotation‑‑‑Expression "public policy" means that no man can lawfully do that which has a tendency to be injurious to the public welfare‑‑"Public policy" comprehends protection and promotion of public welfare‑‑Such is the principle under which freedom to contract or private dealing "is restricted by law for the good of community"‑‑‑Meaning of public policy is the interest of persons other than the parties.
Central Inland Water Transport Corporation Limited and others v. Brojo Nath Ganguly and others AIR 1986 SC 1571; Rattan Chand Hira Chand v. Askar Nawaz Jung and others (1991) 3 SCC 67 and Messrs Abdul Razzak & Co. v. Assistant Collector of Customs and another PLD 1993 Kar. 227 ref.
(k) Contract Act (IX of 1872)‑‑
‑‑‑‑S. 23‑‑‑Contract against public interest‑‑‑Validity‑‑‑Contract which had a tendency to injure public interest or public interests or public welfare was one against public policy‑‑‑Contract opposed to public policy of the State was unlawful‑‑‑Neither the Government nor the subject could lawfully be allowed to do that which had tendency to be injurious to the public or against the public good.
Rattan Chand Hira Chand v. Askar Nawaz Jung and others (1991) 3 SCC 67 ref.
(l) Companies Ordinance (XLVII of 1984)
‑‑‑‑Ss. 290 & 292‑‑‑West Pakistan Water and Power Development Authority Act (XXXI of 1958), S.8(2)(vii)‑‑‑Provisional Manager, appointment of‑‑Privatization of power generation unit‑‑‑Authority privatised one of its units and formed a company for management and operation of the unit‑‑‑Company so formed had shares oaf the Authority as well as the Company‑‑‑Despite the fact that company had minority shares and Authority had majority shareholdings of 64 % the management was with the company‑‑‑Management was conducting the affairs of the company in a manner which was not only oppressive to its members and creditors, but also prejudicial to the public interest‑‑‑Company was siphoning away billions of rupees to its affiliates by raising price of energy exorbitantly‑‑‑Effect‑‑‑All the funds belonged to the public while in return, the‑ public was getting ~ expensive electricity‑‑Management by mismanagement was fleecing the company‑‑‑Prima facie the management was conducting .the affairs of the company in a manner prejudicial to public interest as also oppressive to the Authority‑‑‑High Court to ensure the smooth running of the company respondent No. I and to restrain the company respondent No.2 from acting in a manner prejudicial to the public interest and detriment to that of Authority appointed Provisional Manager to manage the affairs of the company pending decision of the main petition.
Killick Nixon Ltd. and others v. Bank of India and others (1985) 57 Coin. Cas. 831; Re: Cumana Ltd. 1986 CLC 430; Amal Kumar Mukharjee and another v. Clarian Advertising Service Ltd. and another (1982) 52 Com: Cas. 315 and Richardson and Crudes Ltd. v. Haridas Mundhra and others AIR 1959 Cal. 695 ref.
(m) Words and phrases‑
‑‑"Public policy" ‑‑‑Connotation.
Mirza Mahmood Ahmad for Petitioner. Abdul Hafeez Pirzada for Respondent No. 1.
Makhdoom Ali Khan for Respondent No.2.
Date of hearing: 12th April, 2000.
JUDGMENT
P L D 2000 Lahore 483
Before Malik Muhammad Qayyum, J
M.D.TAHIR, ADVOCATE‑‑‑Petitioner
versus
FEDERATION OF PAKISTAN through Secretary, Ministry of Foreign Affairs, Islamabad
and 5 others‑‑‑Respondents
Writ Petition No. 13013 of 2000, decided on 6th July, 2000, Constitution of Pakistan (1973)‑‑
‑‑‑‑Art. 199‑‑‑Constitutional petition‑‑‑Petitioner, an advocate, had alleged in his constitutional petition that Federation of Pakistan had filed a case against India before the International Court of Justice for damages on account of downing of a Pakistan Navy Plane, but due to the failure of respondents the said case was dismissed‑‑‑Petitioner had prayed that respondents (including the Attorney‑General for Pakistan who argued the case before International Court of Justice and a senior advocate, who was also Member of National Security Council of Pakistan and had acted as an ad hoc Judge of International Court of Justice), be ordered to‑repay to the State all that money they had received to pursue the matter abroad and State be directed to take legal proceedings against the persons responsible for giving wrong advice to defame the country in the eyes of the world‑‑‑Validity‑‑‑Held, constitutional petition had not been filed in good faith but to malign the respondents to the detriment of National interest‑‑‑Ad hoc Judge representing Pakistan at the International Court of Justice and Attorney‑General for Pakistan, who argued the case, had acquitted themselves honourably during the course of proceedings at the International Court of Justice by achievement of obtaining a direction from the Court to India and Pakistan to settle their disputes, including that of Jammu and Kashmir, through negotiations‑‑‑Constitutional petition was dismissed in limine in circumstances.
A perusal of the judgment of International Court of Justice was sufficient in itself to refute the allegations made against the respondents by the petitioner. The petitioner was under total misconception that the Aircraft case had been lost by Pakistan, although what had happened, in fact, was that the International Court of Justice, due to technical reasons, had not gone into the merits of the case but had directed both, India and Pakistan, to settle their disputes peacefully and in good faith in accordance with the obligations undertaken by them under the Charter of Untied Nations as well as Simla Agreement of 1972 and Lahore Declaration of 1999. The Attorney‑General for Pakistan had raised the question of Kashmir dispute before the International Court of Justice and, therefore, the said Court, in its unanimous decision of 16 Judges had called upon the two countries, which amounted to a direction, to settle their disputes meaning thereby, all disputes including the dispute of Jammu and Kashmir as well as of Aircraft. The use of the word "disputes", in the judgment of the Full Court, was more significant for Pakistan and this outcome was a clear legal and moral victory for Pakistan in the eyes of International Court of Justice. To say otherwise would be to shut eyes to realities.
The judgment delivered by the Judges of the International Court of Justice was sufficient to show the efforts put in by the Attorney‑General for Pakistan, in arguing the matter and by representing Pakistan, the ad hoc Judge, in formulating his dissenting judgment. The International Court of Justice thus unanimously directed that all disputes between India and Pakistan should be settled in good faith in accordance with the obligations undertaken by both India and Pakistan in accordance with the United Nations Charter and the agreements between the parties in the form of Simla Agreement of 1972 and Lahore Declaration, 1999. In the majority judgment the word "disputes" had been used in plural which showed that the Court had acknowledged that there were more disputes than one pending between the two countries which must be settled through peaceful means. Had the dispute of Jammu and Kashmir not been raised by the Attorney‑General for Pakistan in arguments, the word "disputes" in plur4l would not have been used by the International Court of Justice in the judgment.
The only inference which could be drawn was that Constitutional petition had not been filed in good faith but to malign the respondents to the detriment of national interest. The Ad Hoc Judge and the Attorney‑General for Pakistan had acquitted themselves honourably during the course of proceedings at the International Court of Justice. Obtaining 'a direction from International Court of Justice to India and Pakistan to settle their disputes through negotiation was no mean achievement.
M.D. Tahir, Advocate.
Kh. Saeed uz Zafar, Deputy Attorney‑General for Pakistan.
Date of hearing: 3rd July, 2000.
P L D 2000 Lahore 489
Before Mian Allah Nawaz, Amir Alam Khan
and Karamat Nazir Bhandari, JJ
MUHAMMAD ZUBAIR AKRAM‑‑Petitioner
versus
AITCHISON COLLEGE, LAHORE‑‑‑Respondent
Writ Petition No. 15063 of 1998, decided on 12th May, 2000.
(a) Constitution of Pakistan (1973)‑‑
‑‑‑‑Art. 199‑‑‑Martial Law Order (Zone B) No.86, dated 29‑5‑1961‑‑Societies Registration Act (XXI of 1860), S.13‑‑‑Constitutional jurisdiction of High Court‑‑‑Scope‑‑‑College was given under the management and control of Board of Governors constituted under the statutes framed under Martial Law Order (Zone B) No.86, which Order was protected by the Constitution‑‑‑Status of such statutes, therefore, partook the character of statutory instruments/statutory rules and were to be enforced in the like manner‑‑‑College, a society, was dissolved and the old statutes were replaced with that of the fresh ones under Martial Law Orders (Zone B) No.86‑‑‑Such change was brought about as a matter of fact with certain powers and control of the Government which were previously not vested in the Council running the college as a society, nor were available as such under the old statutes‑‑‑ Very promulgation of said statutory instruments whereby the Board of Governors was set up which had taken over the control and management of the College, was enough to conclude that the control of the college was taken over by the Government‑‑‑Held, society/college was being managed and governed under the statutes framed in pursuance of a Martial Law Order (Zone B) No.86, which were of legislative nature, guarantees as extended to the employees of every other corporation would also be applicable and ‑extended to the employees, the students as also the employer vis-à-vis the College and the Principal‑‑‑Cause, if any, would be justiciable by the High Court under Art. 199 of the Constitution of Pakistan (1973).
Mubjeeb‑ur‑kehman Shami v. Principal, Aitchison College, Lahore 1994 CLC 342 distinguished.
Muhammad Afzal v. The Commissioner, Lahore Division and the Estate Officer, Lahore Improvement Trust' PLD 1963 SC 401; Gulab Din v. Major A. T. Shaukat and others PLD 1961 (W.P) Lah. 952; Allah Bakhsh v. District Magistrate, Jhang, and 2 others PLD 1978 Lah, 765; Mujeeb‑ur Rehman Shami v. Principal, Aitchison College, Lahore and 2 others 1994 CLC 342; Black's Law Dictionary; The Deputy Managing Director, National Bank of Pakistan, Principal Office, Jinnah Avenue, Dacca and others v. Ataul Huq PLD 1965 SC 201; The University of Dacca v. Zakir Ahmed PLD 1965 SC 90; Salahuddin and 2 others v,. Frontier Sugar Mills & Distillery Ltd., Tokhat Bhai and 10 others PLD 1975 SC 244; Ajay Hasia v. Khalid Mujib AIR 1981 SC 487; Humayun\ ' Khan v, Messrs Ghee Corporation of Pakistan Ltd. and 2 others PLD 1'984 Lah. 35; Muhammad Nazir Khan v. Dr. Muba®har Hasan and others PLD 1974 Lah. 49; Aftab Ahmad Warsi v. Punjab Road Transport Corporation 1991 PLC (C.S.) 484; Huffaz Seamless Pipe Industries Ltd. v. SW Northern Gas Pipelines Limited and others 1988 CLC 1890; Miss Misbah Masood v. Principal, Government College for Women 1997 MLD 239.7; Riaz‑ul‑Haq v. Selection Committee Constituted for Admission to Bolan Medical College through Secretary, Principal, Bolan Medical College, Quetta and 6 others 1997 SCMR 1845; Abdul Sattar v. Government of Sindh through the Secretary, Karachi and another PLD 1978 Kar. 59; Muhammad Farrukh Fayyaz v. Aitchison College, Lahore and another 1997 MLD 928; Sabhajit Tewary v. Union of India and others AIR 1975 SC 1329;. Shamsher Khan & Co v. Karachi Water and Sewerage Board and another 1988 CLC 1891; Muhammad Rafique Tarar v. Justice Mukhtar Ahmad Junejo, The Chief Election Commissioner of Pakistan and 6 others PLD 1998 Lah. 461 ref.
(b) Constitution of Pakistan (1973)‑‑
‑‑‑‑Art. 199(5)‑‑Expression "person" occurring in Art. 199(5) of the Constitution‑‑‑Connotation‑‑‑College being governed by the Board of Governors and dominative control of said Board, being that of the Provincial Government, fell within the definition of word "person" used in Art.199(5) of the. Constitution and thus, amenable to the Constitutional jurisdiction of High Court‑‑[Muhammad Farrukh Fayyaz v. Aitchison College, Lahore and another 1997 MLD 298 overruled].
Muhammad Farrukh Fayyaz v. Aitchison College, Lahore and another 1997 MLD 298 overruled.
Sabhajit. Tweary v. Union of India and others AIR 1975 SC 1329 and Shamsher Khan & Co. v. Karachi Water and Sewerage Board and another 1'988 CLC 1891 distinguished.
Mubjeeb‑ur‑Rehman Shami v. Principal, Aitchison College, Lahore 1994 CLC 342; Black's Law Dictionary; Ajay Hasia v. Khalid Mujib AIR 1981 SC 487; Muhammad Farrukh Fayyaz v. Aitchison College, Lahore and another 1997 MLD 298; Muhammad Rafique Tarar v. Justice Mukhtar Ahmad Junejo, The Chief Election Commissioner of Pakistan and 6 others PLD 1998 Lah. 461; Salahuddin and 2 others v. Fronteir Sugar Mills and 10 others PLD 1975 SC 244 and Messrs Huffaz Seamless Piple Industries Ltd. v. Sui Northern Gas Piplelines Ltd. and others 1998 CLC 1890 ref.
A. K. Dogar for Petitioner.
Ijaz Hussain Batalvi and Maqbool Elahi, A.‑G., Punjab for Respondents.
Dates of hearing: 2Qth and 24th January, 2000.
P L D 2000 Lahore 508
Before Mian Allah Nawaz, C. J., Falak Sher, Tanvir Ahmad Khan, Mian Nazir Akhtar
and Malik Muhammad Qayyum, JJ
Mrs. SHAHIDAFAISAL ‑‑‑ Petitioner
versus
FEDERATION OF PAKISTAN and 3 others‑‑‑Respondents
Writ Petitions Nos.739 and 6184 of 2000, decided on 14th June, 2000.
Per Mian Allah Nawaz, C.J., Falak Sher, Tanvir Ahmad Khan and Malik Muhammad Qayyum, JJ. agreeing; Mian Nazir Akhtar, J. disagreeing partly‑‑
(a) National Accountability Bureau Ordinance (XVIII of 1999)‑‑
Preamble‑‑‑Constitution of Pakistan (1973), Art.199‑‑‑Constitutional petition‑‑‑Maintainability‑‑‑High Court has jurisdiction to issue writ against National Accountability Bureau and its functionaries and declare its acts/actions without lawful authority if such acts/actions/arrest are found to be without jurisdiction‑‑‑Principles.
Notwithstanding the Proclamation of 14th October, 1999 and Provisional Constitution Orders Nos. 1, 2, 4 to 9 of 1999 and 1 of 2000, the Constitution of 1973 still remains as the paramount law of the land subject to certain conditions namely that certain parts of it had been held in abeyance.
The power of judicial review vesting in superior Courts under Article 199 and other Articles of the Constitution continue to remain in field. The mere fact that the Judges of the superior Courts have taken new oath under P.C.O. No.l of 1999, does not disable them from their power to interpret laws and scrutinize the actions of National Accountability Bureau and its functionaries. The power under Article 199 had not been taken away by any ouster clause. The Courts have full authority to scrutinize/judge the validity of any act or action of functionaries including the functionaries of National Accountability Bureau. The superior Courts have power to declare any action, act or proceedings of National Accountability Bureau which are found to be without any lawful authority or suffer from excess of jurisdiction or mala fide, as coram non judice.
High Court, therefore, has jurisdiction to issue writ against National Accountability. Bureau and its functionaries and declare its acts/actions without lawful authority if such acts/actions/arrest are found to be without jurisdiction.
Per Mian Nazir Akhtar, J. agreeing with Mian Allah Nawaz, C.J.‑‑
(b) National Accountability Bureau Ordinance (XVIII of 1999)‑‑
‑‑‑‑S. 18‑‑‑Constitution of Pakistan (1973), Art. 199‑‑‑Constitutional petition‑‑‑Maintainability‑‑‑High Court had jurisdiction under Art. 199 of the Constitution to see as to whether the custody of the accused was with or without lawful authority or whether the accused was being treated in a lawful manner irrespective of the ‑ fact that References had been filed before Accountability Court.
Zafar Ali Shah v. Pervez Musharraf, Chief Executive of Pakistan PLD 2000 SC 869 and Government of Sindh v. Raeesa Farooq 1994 SCMR 1283 ref.
Per Mian Nazir Akhtar, J. agreeing with Mian Allah Nawaz, CJ. ‑‑
Per Mian Allah Nawaz, C.J., Falak Sher, Tanvir Ahmad Khan and Malik Muhammad Qayyum, JJ. agreeing‑‑
(c) National Accountability Bureau Ordinance (XVIII of 1999)‑‑
‑‑‑‑Preamble‑‑‑Underlying intent of the Ordinance, according to its preamble, was to eradicate corruption.
(d) National Accountability Bureau Ordinance (XVIII of 1999)‑‑
‑‑‑‑S 5(r)‑‑‑"Wilful default"‑‑‑Non‑payment/return/repayment of the amount due to any Bank, financial institution or statutory institution within thirty days was a "wilful default" and was a continuing offence liable to be proceeded under the National Accountability Bureau, Ordinance, 1999‑‑?"Continuing offence"‑‑‑Concept‑‑‑Question whether a particular' offence was continuing or not depended upon the language of the Statute which had created the offence, the nature of the offence and, above all, the purpose which was intended to be achieved by constituting a particular act as an offence‑‑‑Declaration of Chief Executive of Pakistan which was intended to provide opportunity to defaulters to clear their liabilities and save themselves from criminal proceedings, had no nexus with the nature of offence‑‑‑If the debtor had not paid the debt within the period committed by him and had not made any promise ‑to pay before the Court even, offence committed by such debtor was a continuing offence.
State of Bihar v. Deokaran Nenshi AIR 1973 SC 908 and AIR 1984 SC 1688 ref.
(e) Criminal trial‑
‑‑‑‑"Continuing offence"‑‑‑Concept.
State of Bihar v. Deokaran Nenshi AIR 1973 SC 908 and AIR 1984 SC 1688 ref.
(f) National Accountability Bureau Ordinance (XVIII of 1999)‑
‑‑‑‑Sched.‑‑‑Constitution of Pakistan (1973), Art.12‑‑‑Wilful default, a continuing offence‑‑‑Offence of wilful default incorporated in the Schedule to National Accountability Bureau Ordinance, 1999 being a continuing offence, debtor who had neither paid the principal amount nor its mark‑up, could not seek benefit under Art. 12 of the Constitution as rule of retrospectivity was not applicable to the offence which was continuing in nature.
Sajjan Singh v. State of Punjab AIR 1964 SC 464; Shiv Dutt Rai Fateh Chand and others v. Union of India and another AIR 1984 SC 1194 and Sint. Maya Rani Punj v. Commissioner of Income‑tax, Delhi AIR 1986 SC 293 ref.
Per Mian Nazir Akhtar, J.‑‑
Riffat Askari v. The State PLD 1997 Lah. 285; State of Bihar v. Deokaran Nenshi and another AIR 1973 SC 908; Bhagirath Kanoria and others v. State of M.P. AIR 1984 SC 1688; Best v. Butler and Fitzqibbon (1932) 2 KB 108; Sajjan Singh v. State of Punjab AIR 1964 SC 464; Shiv Dutt Rai Fateh Chand and others v.Union cf India and another AIR 1984 SC 1194 and Mir Ghous Bakhsh Bizenjo v. The Islamic Republic of Pakistan through Secretary, Ministry of Law, Islamabad and another PLD 1976 Lah. 1504 ref.
Per Mian Allah Nawaz, C.J., Falak Sher, Tanvir Ahmad Khan and Malik Muhammad Qayyum, JJ. agreeing; Mian Nazir Akhtar, J. disagreeing partly‑‑
(g) Constitution of Pakistan (1973)‑‑‑
‑‑‑‑Art. 12‑‑‑Protection against retrospective punishment‑‑‑Every legislation which makes an act done before passing of law and which was innocent at that time, such act/omission cannot be made penal and doer cannot be punished and prosecution for such an offence will be wholly void.
Sajjan Singh v. State of Punjab AIR 1964 SC 464; Shiv Dutt Rai Fateh Chand and others v. Union of India and another AIR 1984 SC 1194?ref.
(h) Constitution of Pakistan (1973)‑‑
‑‑‑‑Art. 25‑‑‑Equality of citizens‑‑‑Scope‑‑‑Equality before law was to be applied within the domain of lawful activity, meaning thereby that same did not apply to illegal activity‑‑‑If illegal favours had been shown to some persons then the other person could not claim such illegal actions/activities through agency of the Court.
Article 25 of the Constitution ensures equality before law and equal protection of law, meaning thereby that State must treat similarly situated persons equally and they be meted out even‑handed treatment. If the functionaries of State violate this rule, such persons are entitled to challenge such uneven and partisan treatment and seek its quashment under Article 199 of the Constitution. Similarly, if the Government treats a person illegally, and less favourably, then such other person can come to the Court. This is well‑known concept of equality and fairness. However, this principle is subject to a well‑defined principle that equality before law is to be applied within the domain of lawful activity, meaning thereby that it does not apply to illegal activity. For example if it shows illegal favours to some persons then other person cannot claim such illegal actions/activities through agency of Court.
Sint. Maya Rani Punj v. Commissioner of Income‑tax, Delhi AIR 1986 SC 293; Chief Commissioner v. Kitty Puri AIR 1973 Dehli 148 and Ram Prasad Joshi v. Union of India AIR 1978 Raj. 131 ref..
(i) National Accountability Bureau Ordinance (XVIII of 1999)‑‑
‑‑‑‑Sched.‑‑‑Constitution of Pakistan (1973), Arts. 25 & 199‑‑‑Constitutional petition‑‑‑Wilful default‑‑‑Equality of citizens‑‑‑Contention of the petitioner was that a number of similarly situated defaulters had not been arrested and no reference had been sent against them to the National Accountability Court,‑ action against the petitioner therefore was violative of equality protection clause and was arbitrary and vitiated by unfairness ‑‑‑Validity‑‑?Equality protection clause guaranteed equal treatment before law and equal protection of law and was not designed to cover the instance of illegal action/activity‑‑‑Treatment of National Accountability Bureau as far as other similarly situated people were concerned, though was not viewed with favour, however, petitioner, on the strength of the contention, was not entitled to any relief‑‑‑High Court hoped and directed that National Accountability Bureau would deal with the defaulters (similarly situated) equally and apply the law.
Per Mian Nazir Akhtar, J. holding different veiw‑
Per Mian Allah Nawaz, C.J., Falak Sher, Tanvir Ahmad Khan and Malik Muhammad Qayyum, JJ. agreeing; Mian Nazir Akhtar, J. disagreeing partly‑‑
(j) National Accountability Bureau Ordinance (XVIII of 1999)‑
‑‑‑‑S. 25‑A‑‑‑Constitution of Pakistan (1973), Arts. 4. 12 & 25‑‑‑Vires of S.25‑A, National Accountability Bureau Ordinance, 1999‑‑‑Provision of S.25‑A of the Ordinance which was a new legislative measure to effect the recovery of outstanding loans from the defaulters, who had, been designated as "wilful defaulters", and was enacted by the Competent Authority occupied the field validly and thus was not repugnant/ultra vires to Arts.4, 12 or 25 of the Constitution of Pakistan (1973)‑‑‑Provision of S.25‑A of the Ordinance analysed.
Statutory Construction by Crawford, p.429 ref. .
Per,Mian. Nazir Akhtar, J. holding different view‑
Fateh Khan v. Mst. Khanam Jan and others PLD 1961 (W.P.) Pesh. 20; Pakistan Herald Publications (Private) Ltd. and 23 others v. Federation of Pakistan and 21 others 1998 CLC 65; Al‑Qur'an Verses 22:4; 23:4; Nabi Ahmad and another v. The Home Secretary, Government of West Pakistan, Lahore and 4~others PLD 1969. SC 599; Philips v. Eyre (1870) 6 QB 1; Shafi Ahmad v. The State 1977 PCr.LJ 717; Golden Industries Ltd. v. Province of Sindh and 2 others PLD 1983 Kar. 76 and State Bank of Pakistan through the Banking Officer v. Messrs Raza Enterprises (Regd.) and 2 others 1990 PCr.LJ 317 ref.
Per Mian Allah Nawaz, C.J., Falak Sher, Tanvir Ahmad Khan and Malik Muhammad Qayyum, JJ. agreeing; Mian Nazir Akhtar J. disagreeing partly‑‑
(k) Interpretation of statutes‑‑
‑‑‑‑ Intention of Legislature‑‑‑Courts never impute motive to the Legislature:
Statutory Construction by Crawford, p.429 ref.
(l) Interpretation of statutes‑
‑‑‑‑ Implied repeal, doctrine of‑‑‑Applicability‑‑‑New law, to the extent of repugnancy, repeals the earlier one by the doctrine of implied repeal and if a special law is enacted, same overrides the general law.
Statutory Construction by Crawford, p.429 ref.
(m) National Accountability Bureau Ordinance (XVIII of 1999)‑‑
‑‑‑‑Sched.‑‑‑Constitution of Pakistan (1973), Art.199‑‑‑Constitutional petition‑‑‑Wilful default‑‑‑Facts of the case clearly demonstrated that the debtors (petitioners) had come to the Court with unbending resolution not to pay the loans on one pretext or the other which were admittedly due against them‑‑‑Debtors (petitioners) having come to the Court with unclean hands were not entitled to grant of relief under Art. 199 of the Constitution of Pakistan.
Md. Tahir v. State AIR 1956 Assam 12; New India Industries Ltd. v. Union of India AIR 1990 Bom. 239 and Airport Support Services v. Airport Manager 1998 SCMR 2268 ref.
Per Falak Sher, J. agreeing with Mian Allah Nawaz, C.J.‑‑
Per Mian Nazir Akhtar, J.‑‑
(n) National Accountability Bureau Ordinance (XVIII of 1999)‑?‑‑
‑‑Preamble‑‑‑Object and scope of the Ordinance.
(o) National Accountability Bureau Ordinance (XVIII of 1999)‑‑
‑‑‑‑Ss. 9 & 15(b)‑‑‑"Corruption and corrupt practices"‑‑‑Definition‑‑‑Scope.
The definition of "corruption and corrupt practices" given in section 9 of the National Accountability Bureau Ordinance, 1999 is, wide enough to cover the case of a person if he; by corrupt, dishonest or illegal, means obtained or seeks to obtain for himself, or for his spouse and/or dependants or any other person, any property, valuable thing, or pecuniary advantage or misuses his authority so as to gain any benefit or favour for himself/or any other person or to refer or attempt to do so. This is also implied in the disqualification of an offender provided under .section 15(b) of the Ordinance whereby a person on being convicted of an offence of corruption and/or corrupt practices is not to be allowed to apply for or be granted or allowed any financial facilities in the form of any loan or advances from any bank or financial institution in the public sector, for a period of 10 years ‑from the date of conviction.
Ch. Aitzaz Ahsan assisted by Faisal Hussain Naqvi for Petitioner.
Khawaja Saeed‑uz‑Zafar, Deputy Attorney‑General and Farooq Adam for Respondents.
Date of hearing: 25th April, 2000.
P L D 2000 Lahore 564
Before Mian Allah Nawaz, C.J., Falak Sher, Tanvir Ahmad Khan, Mian Nazir Akhtar
and Malik Muhammad Qayyum, JJ
ANWAR SAIFULLAH KHAN‑‑‑Petitioner
versus
THE STATE and 4 others‑‑‑Respondents
Writ Petitions Nos. 1187, 1188, 1189,1190, 1651, 1652, 1653 and 1654 of 1999, heard on 15th June, 2000.
Per Mian Allah Nawaz, C.J., Tanvir Ahmad Khan, Mian Nazir Akhtar and Malik Muhammad Qayyum, JJ. agreeing‑‑
(a) National Accountability Bureau Ordinance (XVIII of 1999)‑
‑‑‑‑S. 9(b)‑‑‑Constitution of Pakistan (1973), Art.199‑‑‑Constitutional petition‑‑‑Corruption and corrupt practices‑‑‑Post‑arrest bail, grant of‑‑National Accountability Bureau Ordinance, 1999 being a subordinate legislation, High Court had jurisdiction under Art. 199 of the Constitution to review, examine and strike down any act or omission of the Bureau as well as that of Accountability Court, if such act or omission was without jurisdiction, in excess of jurisdiction, was in defiance of patent provision of law or tainted with mala fides‑‑‑High Court, therefore, had jurisdiction under Art.199 of the Constitution (1973) to grant bail to the accused‑‑‑Bail was granted by High Court in specified references subject to the deposit of cash security of Rs.2 crore by the accused with the Accountability Court.
Conceptually, 'bail' means to procure release of one charged with an offence by ensuring his future appearance in Court and compelling him to remain within the hands of the Court through sureties. The person, who is released on bail is known 'principal' while the person who gives security is known as 'surety'. The security, to be furnished, may be in the form of bond or cash. The criminal administration of justice has inherited this concept from times immemorial. During the era of the Normans rule in England, the whole community gave security for the appearance of an accused before the Court of trial. The community was treated as a property and served as a surety. This concept vanished with the march of time and in its place the security of a third person was substituted. The concept of pre‑trial release of the accused was developed on three presumptions: firstly, the accused was presumed to be innocent till he was found guilty; secondly, the accused should have a right to prepare his defence and prove his innocence before the Court of trial; and thirdly, the accused should not be punished before the finding of his conviction was rendered by the Court. These rules were developed by the contribution of Jurists and Courts. There was/is a judicial consensus that a Court has no authority under sections 497 and 498 read with sections 513 and 514 of the Code of Criminal Procedure to ask the accused to furnish cash security. However, various approaches to this issue were adopted in different countries in consonance with the ground realities faced by them.
It is true that under section 9(b) all offences under the National Accountability Bureau Ordinance (XVIII of 1999) are non‑bailable and it has been stated that notwithstanding anything contained in sections 426, 491, 497, 498 and 561‑A or any other provision of the Cr.P.C. or any other law for the time being in force, no Court including the High Court shall have jurisdiction to grant bail to any person accused of such offences. It is also true that Chairman, National Accountability Bureau has been empowered under subsection (c) of section 9 to release any accused from its custody/detention after considering the gravity of the charge against such person and where the accusation specifies any amount in respect of which the offence is alleged to have been committed, after the payment of such amount. The underlying objectives of this Ordinance in the words of Preamble are "to provide for effective measures for the detection, investigation, prosecution and speedy disposal of cases involving corruption, corrupt practices, misuse/abuse of power, misappropriation of property, kickbacks, commissions and for matter connected and ancillary or incidental thereto". The supreme purpose of this legislation is to effect recovery of defaulted amounts of lending institutions, money or gains, obtained through corrupt practices, misuse or abuse of powers, kickbacks, commissions and other like amounts. The powers conferred upon the Chairman, National Accountability Bureau are Draconian in nature, nevertheless these are not incommensurate with the ground realities obtaining in Pakistan. The National Accountability Bureau Ordinance, 1999 is a subordinate legislation and High Court had jurisdiction to review, examine and strike down any act or omission of the National Accountability Bureau as well as that of the Accountability Court if such act or omission is without jurisdiction, in excess of jurisdiction, or is in defiance of patent provisions of law or tainted with mala fides. High Court has jurisdiction 'under Article 199 of the Constitution (1973) to grant bail to the accused.
High Court has power to grant/allow post‑arrest bail to any person accused of any offence under the Ordinance subject to furnishing of cash security. National Accountability Bureau Ordinance, 1999 deals with whitecollar crimes relating to massive embezzlement or misappropriation of public money. The Ordinance postulates that all offences thereunder shall be nonbailable and all the Courts including a High Court shall have no jurisdiction to grant bail to any person/accused. In the present case the Accountability Court had rejected the application for the grant of bail on the basis of lack of jurisdiction.
High Court has jurisdiction under Article 199 of the Constitution to release the accused on bail as the principle of ubi jus ibi remedium is attracted to the case. It means where there is a wrong, there is remedy. In the present case, law does not equip the Court of trial with the power to grant bail to a person accused of any offence under the Ordinance. This being the position, High Court declined to send the case back to the trial Court to examine the plea for the grant of post‑arrest bail.
The case against the accused is that of misuse of political power. The accusations against him flow from a massive documentary evidence. The accused naturally, needs an occasion to see these documents, prepare his defence and face the trial. This entitles him, prima facie, the concession of post‑arrest bail. He has a prima facie case calling for exercise of jurisdiction of High Court to order his pre‑trial release. This will enable him to prepare his defence. The counsel for the accused voluntarily stated that he was prepared to deposit Rs. one crore as cash security with the Accountability Court. The person was accused of having caused a total loss of Rs.8.05 crore to the National Exchequer. In the context of the above amount, the cash security in the sum of Rupees two crore would meet the ends of justice. The accused was directed to be released on bail in the specified references subject to his deposit of cash security in the sum of Rupees two crore with the Accountability Court.
Mir Abdul Baqi Baluch v. The Government of Pakistan and others PLD 1968 SC 313; Ch. Manzoor Elahi v. Federation of Pakistan and others PLD 1975 SC 66; Zahoor Ilahi, M.N.A. v. The State 1975 PCr.LJ 1413; Ch. Zahur Ilahi, M:N.A. v. The State PLD 1977 SC 273; Allied Bank of Pakistan Ltd. v. Khalid Farooq 1991 SCMR 599; The State v. Syed Qaim Ali Shah 1992 SCMR 2192; Ch.Abdul Malik v. The State PLD 1968 SC 349; Government of Sindh v. Raeesa Farooq 1994 SCMR 1283; Ch. Shujaat Hussain v. The State 1995 SCMR 1249; Tariq Bashir v. The State PLD 1995 SC 34; Adrian Afzal v. Capt. Sher Afzai PLD 1969 SC 187; Malik Gul Hassan & Company v. Allied Bank of Pakistan 1996 SCMR 237; Hakim Ali Zardari v. The State PLD 1998 SC 1; Mrs. Shahida Faisal v. Federation of Pakistan and others PLD 2000 Lah. 508 and The State v. Muhammad Hasham Babar PLD 1997 Lah. 605 ref.
Mrs. Shahida Faisal v. Federation of Paksitan and others PLD 2000 Lah. 508 fol.
(b) Bail‑
‑‑‑‑ Concept.
Conceptually 'bail' means to procure release of one charged with an offence by ensuring his future appearance in Court and compelling him to remain within the hands of the Court through sureties. The person, who is released on bail, is known 'principal' while the person who gives security is known. as 'surety'. The security to be furnished may be in the form of bond or casn. The criminal administration of justice has inherited this concept from times immemorial. During the era of the Normans rule in England, the whole community gave security for the appearance of an accused before the Court of trial. The community was treated as a property and served as a surety. This concept vanished with the march of time and in its place the security of a third person was substituted. The concept of pre‑trial release of the accused was developed on three presumptions: firstly, the accused was presumed to be innocent till he was found guilty; secondly, the accused should have a right to prepare his defence and prove his innocence before the Court of trial; and thirdly, the accused should not be punished before the finding of his conviction was rendered by the Court. These rules were developed by the contribution of Jurists and Courts. There was/is a judicial consensus that a Court has no authority under sections 497 and 498 read with sections 513 and 514 of the Code of Criminal Procedure to ask the accused to furnish cash security. However, various approaches to this issue were adopted in different countries in consonance with the ground realities faced by them.
The State v. Muhammad Hasham Babar PLD 1997 Lah. 605 and Hakim Ali Zardari v. The State PLD 1998 SC 1 ref.
(c) Maxim:
‑‑‑"Ubi jus ibi remedium"‑‑‑‑Applicability.
(d) National Accountability Bureau Ordinance (XVIII of 1999)‑‑
‑‑‑‑Preamble‑‑‑Object of the Ordinance.
Per Falak Sher, J. Contra‑‑
Kh. Haris Ahmad and Zahid Hamid for Petitioner.
Sher Zaman Khan, Dy. Attorney‑General for Respondents.
Dates of hearing: 5th, 6th, 8th, 14th and 15th June, 2000.
P L D 2000 Lahore 589
Bt fore Ch. Ijaz Ahmad, J
MUHAMMAD ASLAM‑‑‑Petitioner
versus
SECRETARY, EXCISE. and others‑‑‑Respondents
Writ Petitions Nos. 12273, 12257, 12596 of 1999, heard on 29th March, 2000.
(a) West Pakistan Urban Immovable Property Tax Act (V of 1958)‑‑‑
‑‑‑Ss.2(i)` & 3‑‑‑Punjab Government Notification dated 28‑9‑1998‑‑‑Punjab Local Government Ordinance (VI of 1979), S.2(ix)‑‑‑Constitution of Pakistan (1973), Art. 199‑‑‑Constitutional petition‑‑‑ "Urban area"‑‑Definition‑‑‑ "Urban ‑area" must be situated within the boundaries of Municipal Corporation or "other Authority" ‑‑‑Words "other Authority" must be read in conjunction with earlier words used by the legislature in S.2(i) of the West Pakistan Urban Immovable Property Tax Act, 1958‑‑‑Government has to specify urban areas and Municipal Corporation has to issue a notification to include the property in urban area for the purpose of levy of tax under the provisions of West Pakistan Urban Immovable Property Tax Act, 1958‑‑‑Where the Authority had failed to bring on record any notification that the properties iii question were notified to be included in the urban area by the Municipal Corporation or by the Development Authority, taxation of such property under S.3, West Pakistan Urban Immovable Property Tax Act, 1958, was not legal.
K.S.B. Pumps Company Ltd. v. Town Committee PLD 1973 Note 123 at.p.190 ref.
(b) Interpretation of statutes‑‑
‑‑‑‑ Fiscal 'statute‑‑‑Words used in taxing statute are to be understood in the sense in which such words are used in their popular sense and should be understood to have that meaning which everybody conversant with the trade business or transaction knows.
Messrs Usmania‑Glass Sheet Factory Ltd,, Chitagong v. Sales Tax Officer, Chitagong PLD 1971 SC 205; Collector of Customs Appraisement, Karachi and others v. Messrs Abdul Hameed khan 1977 SCMR 361 and H.M.Walayatullah v. Civil Station Sub‑Committee, Nagpur AIR 1950 Nag.223 ref.
(c) Interpretation of statutes‑‑
Fiscal statute‑‑‑Statute which imposes tax has to be ‑strictly construed and doubts, if any, must be resolved in favour of the subject.
Commissioner of Agricultural Income‑tax, East Bengal v. B.W.M. Abdul Rehman 1973 SCMR 445 and Income‑tax A.C. v. Mrs. EVH Millah PLD 1956 Lah. 45 ref.
Ch. Fazal Ahmad Buttar and Rana Zulqarnain for Petitioner.
Malik Akhtar Hussain Awan, Addl. A.‑G. for Respondents.
Date of hearing: 29th March, 2000.
P L D 2000 Lahore 594
Before Khawaja Muhammad Sharif, J
Mst. NAZIR YASIN‑‑‑Appellant
versus
YASIN FARHAT‑‑‑Respondent
Criminal Appeal No.21 of 1997, heard on 30th June, 2000.
Christian Marriage Act (XV of 1872)‑‑‑
‑‑‑‑Ss. 4, 60 & 68‑‑‑Divorce Act (IV of 1869), S.19(4)‑‑‑Special Marriage Act (III of 1872), S.15‑‑‑Penal Code (XLV of 1860), S.494‑‑‑Christian marriage was monogamous i.e. one man, one woman life long union to the exclusion of all others and polygamy is not lawful‑‑‑No divorce except on the ground of adultery or unchastity‑‑Marriage without divorce to the existing wife/husband was void and punishable under 5.494, P.P.C.‑‑Second marriage is not allowed without divorcing the first wife or the first wife had met her death‑‑‑Person who had entered a second marriage without divorcing the existing wife was convicted under S.494, P.P.C. and sentenced to four years' rigorous imprisonment with a fine of Rs.20,000 and in default of fine to undergo further rigorous imprisonment for six months‑‑‑Amount of fine, if recovered, was directed to be paid to the first wife.
Syed Ali Nawaz Gardezi v. Lt.=Col. Muhammad Yusuf PLD 1963 SC 51; Mrs. Marina Jatoi v. Nuruddin K. Jatoi PLD 1967 SC 580; PLD 2000 FSC 1; Genesis Chaps. 1 & 2; Genesis 2:24; Malaki, Bab 2:14‑16 Ayat; I‑Thessalonians 4:4‑5; 1‑Timothy 3:12; Titus 1:6; 1‑Cornthian 7:2; Prayer Book, pp.638‑639; Pakistan, Emmanuel Zafar, Eastern Law House, p.102; Matthew 19:8‑9; Mark 10:2‑9, 5:32; Mark 10:11‑12; Luke 16:18; 1‑Corinthians 7:10 ref.
T.S. Gill and Masood Akhtar Khan for Appellant.
Ezra Shujaat for Respondent No
Nemo for the State.
Date of hearing: 30th June, 2000.
P L D 2000 Lahore 602
Before Mian Allah Nawaz, C.J., Falak Sher, Tanvir Ahmad Khan, Mian Nazir Akhtar
and Malik Muhammad Qayyum, JJ
Mst. FEHMIDA BEGUM‑‑‑Petitioner
versus
FEDERATION OF PAKISTAN through Secretary, Federal Secretarial., Islamabad and 6 others‑‑‑Respondents
Writ Petition No. 914 of 2000, heard on 4th May, 2000
Per Mian Allah Nawaz, C.J., Mian Nazir Akhtar and Malik Muhammad Qayyum, JJ., agreeing‑
(a) National Accountability Bureau Ordinance (XVIII of 1999)‑‑‑
‑‑‑‑Ss.5(o)(r), 9, 10 & 11‑‑‑Constitution of Pakistan (1973), Art.199‑‑Constitutional petition‑‑‑Maintainability‑‑‑Wilful default ‑‑‑Reference‑‑Person who was neither sponsor nor owner of the defaulting corporate entity; nor exercised any dominative influence in the working of defaulting company and his wife's share in the company was nominal and Creditor Bank had not impleaded him as defaulting party when suit for recovery of loan in the Court of Special Judge Banking was filed, was not a "person" within the terms of S.5(o) of the National Accountability Bureau Ordinance, 1999 nor a "wilful defaulter" within the ambit of S.5(r) of the said Ordinance‑‑Proceedings against such person, therefore, were clearly without jurisdiction and of no lawful consequences‑‑‑Reference to the extent of such person was ordered to be quashed by the High Court tinder its jurisdiction under Art. 199 of the Constitution in circumstances.
From a bare reading of sub‑clause (o) of section 5 of the National Accountability Bureau Ordinance, 1999 it becomes clear that this sub‑clause applied to the corporate bodies, firm, partnership or sole proprietorship. The word "person" is followed by expression "includes" in this sub‑clause.
Ordinarily word "include" is used as an expression of enlargement and implies that something else also falls within that word which was beyond its general organic meaning. This is, however, not the rule of thumb. Some time it conveys a restrictive meaning depending upon the context in which it is used. This expression shows includable approach of law‑making authority. Resultantly it can be said that the expression 'include' is to be interpreted on the touchstone of both approaches given above after examining this expression in context ‑of statute in which it is employed/used. On these touchstones,. it is clear that the Sponsors, Chairman, Chief Executive, Managing Directors, elected Directors, by whatever name they are called, and guarantors of the Company or any one, who exercises dominative control in the affairs of such a corporate body, come within the ambit of this sub-clause. This part of sub‑clause is followed by another part which is exclusionary in approach. It says that it does not include the employees of the Company who were/are appointed and designated as Directors or Chief Executive or even as the sole proprietor. This part of the sub‑clause is in the form of exception to first part. The underlying purpose of this exception is to save the employees from the applicability of first part and from the penal consequences of felonious act committed by their employer. The purpose of this part is to save employees of the companies from unwarranted prosecution for acts and omissions committed by their employer. Philosophy of this clause is humane and highly noble and saves innocent helpless employees from the rigors of criminal action.
In the present case employee of the Company was neither sponsor, nor owner of the defaulting corporate entity; nor he exercised any dominative influence in the working of defaulting Company. His and his wife's shares were nominal. Even the Bank did not implead him as defaulting party when it filed a suit for recovery of loan in the Court of Special Judge Banking. Such person was neither a 'person' within the terms of sub‑clause (o) of section 5 of the Ordinance nor was a 'wilful defaulter' within the ambit of sub‑clause (r) of section 5 and proceedings against such person were clearly without jurisdiction and, therefore, of no lawful consequences. High Court quashed the reference to the extent of such person. The trial Court was directed to proceed with the remaining accused put up for trial in the reference.
Black's Law Dictionary, 6th Edn. and Dilworth v. Commissioner of Stamps 1899 AC 99 ref.
Per Falak Sher, J., Contra‑‑
Per Tanvir Ahmad Khan, J., Contra‑‑
Messrs Airport Support Services v. The Airport Manager; Quaid‑eAzatn International Airport, Karachi and others 1998 SCMR 2268 ref.
Per Mian Allah Nawaz, C.J., Mian Nazir Akhtar and Malik Muhammad Qayyum, JJ, agreeing‑‑
(b) National Accountability Bureau Ordinance (XVIII of 1999)‑‑‑
‑‑‑‑S.5(o) & (r)‑‑‑Word "includes" after the word "person" in S.5(o), National Accountability Bureau Ordinance, 1999‑‑‑Connotation.
Black's Law Dictionary, 6th Edn. and Dilworth v. Commissioner of Stamps 1899 AC 99 ref.
(c) Words and phrases‑‑
‑‑‑‑"Includes"‑‑‑Connotation.
Black's Law Dictionary, 6th Edn. and Dilworth v. Commissioner of Stamps 1899 AC 99 ref.
Per Falak Sher, J. disagreeing with Mian Allah Nawaz, C.J.‑
(d) National Accountability Bureau Ordinance (XVIII of 1999)‑
‑‑‑‑S.5(o) & (r)‑‑‑"Guarantors of the Company"‑‑‑Person having furnished personal guarantee for securing company's loan, for all intents and purposes, fell within the ambit of the expression "guarantors of the Company" enshrined in S.5(o) of the Ordinance itself.
(e) National Accountability Bureau Ordinance (XVIII of 1999)‑‑‑
‑‑‑‑S 5(o) & (r)‑‑‑Companies Ordinance (XLVII of 1984), Ss.2(8)(9) & 17(a)(iv)(v)‑‑‑Expression "Guarantors of the Company" occurring in S.5(o), National Accountability Bureau Ordinance, 1999 does not pertain to the company limited by shares perceived by Ss.2(8), 2(9) & 17(a)(iv)(v) of the Companies Ordinance, 1984.
(f) National Accountability Bureau Ordinance (XVIII of 1999)‑
‑‑‑‑S.5(o)‑‑‑Companies Ordinance (XLVII of 1984), Ss.2(8)(9) & 17(a)(iv)(v)‑‑‑Expression "Guarantors of the Company" occurring in S.5(o), National Accountability Bureau Ordinance, 1999‑‑‑Wilful default‑‑‑"Juristic person"‑‑‑Company limited by shares and Company limited by guarantee‑‑Distinction‑‑‑Winding up of such companies had no nexus with the expression "guarantor of the company" envisaged by S.5(o) of the National Accountability Bureau Ordinance, 1999.
A conjunctive reading of provisions of sections 2(8)(9) and 17(a)(iv)(v) of the Companies Ordinance, 1984 patently demonstrates the basic distinction as to juridical classification of the juristic persons i.e. a company limited by shares and a company limited by guarantee viz. in the case of the former, liability of the company's member is limited to the extent of unpaid face value of the shares one holds, while in the latter it is to the covenanted amount undertaken by a shareholder to contribute towards assets of the company in the event of its winding up, which bears no, nexus with the expression "guarantor of company" envisaged by section 5(o) of the National Accountability Bureau Ordinance, 1999.
Per Tanvir Ahmad Khan, J.
(g) National Accountability Bureau Ordinance (XVIII of 1999)‑‑‑
‑‑‑‑Preamble‑‑‑Constitution of Pakistan (1973), Art. 199‑‑‑Constitutional petition‑‑‑Maintainability‑‑‑Jurisdiction of High Court was all prevailing and High Court could declare any action of National Accountability Bureau to be illegal if the same was without jurisdiction, mala ‑fide or coram non judice.
Mrs. Shahida Faisal v. Federation of Pakistan and others PLD 2000 Lah. 508 fol.
(h) National Accountability Bureau Ordinance (XVIII of 1999)‑‑‑
‑‑‑‑Preamble‑‑‑Object and purpose of the Ordinance. .
The main purpose of the promulgation of National Accountability Bureau Ordinance, 1999 as reflected from the Preamble is not only to take effective steps against corruption and corrupt practices but also initiate measures to recover outstanding amount from the persons who have defaulted in the payment of loans of Banks, Financial Institutions, Government and other agencies.
A. K. Dogar, Senior Advocate, Syed Kazam Bukhari and Muhammad Siddiq Mughal for Petitioner.
Khawaja Saeed‑uz‑Zafar, Dy. A.‑G. for Respondents.
Date of hearing: 4th May, 2000
P L D 2000 Lahore 623
Before Tanvir Ahmad Khan, Malik Muhammad Qayyum and Khalil‑ur‑Rehman Ramday, JJ
THE STATE‑‑‑Petitioner
versus
MUHAMMAD AFAQ, ADVOCATE, LAHORE‑‑‑Respondent
Criminal Original No.23 of 2000, heard on 18th July, 2000.
Contempt of Court Act (LXIV of 1976)‑‑‑
‑‑‑‑S. 3‑‑‑Constitution of Pakistan (1973), Art.204‑‑‑Legal Practitioners and Bar Councils Act (XXXV of 1973), Ss.54 & 41‑‑‑Contempt of Court by art Advocate of High Court‑‑‑Tearing up the cause list and causing injuries to the Reader of the Court by Advocate being interference/obstruction in the dispensation of justice amounted to contempt of Court ‑‑‑Contemner, after admitting his guilt, had tendered his unqualified apology‑‑‑High Court, in circumstances, took a lenient. view and in exercise of its power under Art.204, Constitution of Pakistan (1973) read with Contempt of Court Act, 1976 convicted the contemner and sentenced him till the rising of the Court‑‑‑High Court, in exercise of its powers under S.54, Legal Practitioners and Bar Councils Act, 1973 also suspended the licence of the contemner Advocate from practice and referred his case to the Provincial Bar Council to be dealt with under S.41 of the said Act.
In contempt proceedings every form of interference/obstruction in the dispensation of justice amounts to contempt. Affixation of cause list outside the Court‑room is a step towards the dispensation of justice. The act of tearing up into pieces cause list of the Court before the public amounts to interference with the process of the Court and tends to lower the dignity of the Court itself.
The tearing up of the cause list is a disrespectful attitude towards the Court of law on account of damaging its property which if allowed to continue would certainly hamper the due course of justice. The moment this sort of conduct is demonstrated, the authority of the Court is lowered in the eye of the public. This sort of conduct is not expected of an Advocate of the High Court.
Accused had committed contempt of Court by interfering in the due course of justice/dispensation of justice by not only causing injuries to the Reader of the Court in the performance of his duties but has also torn into pieces the cause list affixed outside the Court‑room.
Since the contemner after admitting his guilt had tendered his unqualified apology, High Court took a lenient view and in exercise of power under Article 204 of the Constitution of Islamic Republic of Pakistan read with Contempt of Court Act, 1976, convicted him for contempt and sentenced him till the rising of the Court. High Court, in exercise of power under section 54 of the Legal Practitioners and Bar Councils Act, 1973, also suspended his licence from practice and referred his case to the Punjab Bar Council to be dealt with under section 41 of the aforesaid Act.
Dr. Aijaz Hassan Qureshi v. Judge of the High Court, Lahore PLD 1973 Lah. 778; Encyclopaedia of the Social Sciences Vols. III‑IV and Ashfaque Ahmad Sheikh v. The State PLD 1972 SC 39 ref.
Dr. Ijaz Ahmad Ch., Addl. A.‑G. for the State.
Dr. Hameed Ahmad Ayaz for Respondent.
Date of hearing: 18th July, 2000.
P L D 2000 Peshawar 1
Before Mian Muhammad Ajmal and Mrs. Khalida Rachid, JJ
MUQEEM KHAN‑‑‑Petitioner
versus
FEDERATION OF PAKISTAN and 4 others‑‑‑Respondents
Writ Petition No. 1003 with Civil Miscellaneous No. 1198 of 1999, decided on 1 st July, 1999.
(a) Constitution of Pakistan (1973)‑‑
‑‑‑‑Arts. 199 & 212‑‑‑Constitutional petition‑‑‑Maintainability‑‑‑Petitioner, a school teacher was transferred after about 17 days of his posting due‑to political pressure‑‑‑Posting and transfer fell within the terms and conditions of a civil servant; therefore, under Art.212 of the Constitution of Pakistan (1973), Constitutional jurisdiction of High Court under Art.199 of the Constitution could not be invoked and in such matter the Service Tribunal had the exclusive jurisdiction‑‑‑Filing of Constitutional petition in such matter deprecated by High Court with observation that giving wrong advice to litigants amounted to misconduct by the counsel.
1991 SCMR 477; PLD 1995 SC 530; 1997 SCMR 167, 1997 SCMR 169, 1997 SCMR 170 and 1997 SCMR 1476 rel.
(b) Client and counsel‑‑‑
‑‑‑‑ Misconduct of counsel‑‑‑Giving. wrong advice to litigant (client) amounted to misconduct.
M. Muazzam Butt for Petitioner.
P L D 2000 Peshawar 3
Before Abdur Rauf Khan Lughmani and Shazad Akbar Khan, JJ
ADAM KHAN‑‑‑Appellant
versus
THE STATE ‑‑‑ Respondent
Criminal Appeal No.72 of 1998, decided on 1st July, 1999.
West Pakistan Arms Ordinance (XX of 1965)‑‑‑
‑‑‑‑S. 13‑‑‑Appreciation of evidence‑‑‑No report of Fire‑arms Expert regarding the bore of the unlicensed pistol. allegedly recovered from accused had been obtained by the prosecution‑‑‑Even the report of Armourer of the Police Department in that, regard was not available‑‑‑Prosecution, thus, had failed to determine the nature of the fire‑arm recovered from the accused‑‑‑Accused was acquitted in circumstances.
PLJ 1995 Pesh. 176 and PLD 1994 Lah. 93 rel.
Dost Muhammad Khan for Appellant.
Muhammad Khan Khakwani for the State.
Date of hearing: 1st July, 1999.
P L D 2000 Peshawar 4
Before Qazi Muhammad Farooq, C J
Col. (Rtd.) Dr. SHARIFULLAH KHAN‑‑‑Petitioner
versus
SUPERINTENDING ENGINEER (PESCO). PESHAWAR ELECTRIC
SUPPLY CORPORATION, PESHAWAR and 3 others‑‑‑Respondents
Civil Revision No.288 of 1999, decided on 29th July, 1999.
(a) Specific Relief Act (I of 1877)‑‑
‑‑‑S. 53‑‑‑Civil Procedure Code (V of 1908), O.XXXIX, Rr. 1 & 2‑‑Irreparable loss‑‑‑Loss which could be measured in terms of money, could not be termed as "irreparable loss".
(b) Electricity Act (IX of 1910)‑‑‑
‑‑‑‑S. 54‑C‑‑‑Civil Procedure Code (V of 1908), O. XXXIX, Rr. 1 & 2‑‑‑Bar of jurisdiction‑‑‑Interim relief in shape of temporary injunction restraining the defendants/licenser from disconnecting supply of electricity, was granted to licensee subject to condition that he will deposit the disputed amount in the Court as required under S.54‑C, Electricity Act, 1910‑‑‑Contention of the licensee was that provisions of S.54‑C, Electricity Act, 1910 were not attracted as his suit based on the report of 'Executive Engineer and laboratory test was well‑founded‑‑‑Validity‑‑‑Licensee's suit was relevant only to the existence of a fair prima facie case which was one of the prerequisites for grant of temporary injunction‑‑‑High Court directed the licensee to deposit the disputed amount in the Court failing which order prohibiting the licenser from discontinuing the supply of energy shall cease to have effect.
Mst. Raisa Bibi v. The Sub‑Divisioinal Officer (E), WAPDA, Operation Sub‑Division, Mansehra and 2 others PLD 1990 Pesh. 105; WAPDA v. Muhammad Fayyaz Butt 1999 MLD 2731 and Water and Power Development Authority through Chairman, WAPDA, WAPDA House, Lahore and others v. Messrs Kashmiri Steel Furnace alias T.I. Steel Furnace, Bund Road, Baghbanpura, Lahore 1999 CLC 492 rel.
Iqbal Ahmad Durrani for Petitioner.
Saadat Hussain for Respondents.
Date of hearing: 29th July, 1999.
P L D 2000 Peshawar 7
Before Mian Muhammad Ajmal and Muhammad Azam Khan, JJ
Messrs PEL APPLIANCES (PVT.) LTD. through Manager (P&A)‑‑‑Petitioner
versus
ABDUL WAHEED KHAN and 4 others‑‑‑Respondents
Writ Petition No.982 of 1997, decided on 16th June, 1999.
Penal Code (XLV of 1860)‑‑‑
‑‑‑‑S. 408‑‑‑Constitution of Pakistan (1973), Art.199‑‑‑Constitutional petition‑‑Criminal breach of trust‑‑‑Adjournment of criminal case sine die by Trial Court till decision of civil suit‑‑‑Propriety‑‑Counter‑civil claim brought by the accused was with the intention to delay the criminal case filed by the complainant against him‑‑‑Trial Court, therefore, could not stay the criminal proceedings and adjourn the case sine die as two matters were pending before two different, forums and were independent of each other‑‑‑Findings of criminal Court were not binding or even relevant for adjudication in a civil suit pending in a Civil Court‑‑‑No progress had been made for early decision of the case by the Civil Court‑‑‑Impugned orders passed by Criminal Courts below were consequently set aside with the direction for the recovery of the car from the possession of accused on which he had no lien and giving the same to the Trial Court for handing same over to its lawful owner on Superdari till the decision of the criminal case‑‑‑Constitutional petition was accepted accordingly.
1972 SCMR 85 and PLD 1968 SC 281 ref:
Jahanzeb Rahim for Petitioner.
Nisar Ahmad Khan for Respondent No. 1.
Manzoor Hussain, A.A.‑G. II for Respondents Nos.2 to 5.
Date of hearing: 16th June, 1999.
P L D 2000 Peshawar 10
Before Abdur Rauf Khan Lughmani and Shahzad Akbar Khan, JJ
FARMAN ULLAH KHAN‑‑‑Petitioner
versus
AGRICULTURAL DEVELOPMENT BANK OF PAKISTAN
through Manager, Tank Branch, District Tank and 2 others‑‑‑Respondents.
Writ Petition No. 13 of 1999, heard on 1st July, 1999.
(a) Civil Procedure Code (V of 1908)--
‑‑‑‑S. 152‑‑‑Banking Tribunals Ordinance (LVIII of 1984), S.5‑‑‑Bering Companies (Recovery of Loans) Ordinance (XIX of 1979), S.6‑‑‑Suit for recovery of loan‑‑‑Amendment of judgment or order‑‑‑Scope and extent‑‑Principles ‑‑‑Suit was finally decreed, full decretal amount was paid by defendant borrower to plaintiff‑Bank and decree having been satisfied, a certificate was issued by plaintiff‑Bank in that respect‑‑‑Plaintiff‑Bank after lapse of two years sought amendment of judgment and decree on ground that there was a mistake in the plaint with regard to claimed amount‑‑‑Validity‑‑‑Provision of S.152. C.P.C. dealt with the situation where there was a clerical mistake in the judgment, decrees or orders‑‑‑Where there was no such mistake in the judgment and decree of the Court and claim of the Bank had been decreed in its totality, Bank could not avail the benefit of S.152. C.P.C.
(b) Civil Procedure Code (V of 1908)‑‑‑
‑‑‑‑0. VI, R.17‑‑‑Banking Tribunals Ordinance (LVIII of 1984),S.5‑‑‑Bankin Companies (Recovery of Loans) Ordinance (XIX of 1979), S.6‑‑‑Suit for recovery of loan‑‑‑Amendment of plaint‑‑‑Conditions and restraints‑‑‑Suit was finally decreed and decree passed was satisfactorily executed as defendant borrower, after making payment of full decretal amount to plaintiff‑Bank, had obtained certificate in that respect from plaintiff‑Bank‑‑‑Plaintiff‑Bank after lapse of two years of settlement of dispute sought amendment of plaint under" O.VI, ' R.17, C.P.C. for claim of some additional amount ‑‑‑Validity‑‑Amendment in pleading under O.VI, R.17, C.P.C. could be allowed at any stage where proceedings were pending in the Court‑‑‑Suit having finally been decreed and decree passed having been executed, it could not be said that any of proceedings were pending before Court‑‑‑Amendment in plaint could not be allowed, in circumstances.
(c) Civil Procedure Code (V of 1908)‑‑‑
‑‑‑‑0. II, R. 2‑‑‑Omission or relinquishment of any portion of claim‑‑‑Effect‑‑‑If any portion of claim was either omitted or intentionally relinquished, plaintiff could not, afterwards, sue in respect of omitted or relinquished portion.
(d) Constitution of Pakistan (1973)‑‑‑
‑‑‑‑Art. 199‑‑‑Constitutional jurisdiction, exercise of‑ ‑If an order was passed by any Court, Tribunal. Authority in violation of law and without lawful authority same could very conveniently be questioned in Constitutional jurisdiction of High Court under Art.199 of Constitution of Pakistan (1973) to remedy any mischief arising out of said illegal order.
Dost Muhammad Khan for Petitioner.
Haji Saadullah Khan Miankhel for Respondents., Date of hearing: 1st July, 1999.
P L D 2000 Peshawar 14
Before Mian Muhammad Ajmal and Sardar Muhammad Raza Khan, JJ
Haji ZAR ALI KHAN, PROPRIETOR‑‑‑Petitioner
versus
GOVERNMENT OF N.‑W.F.P. and 3 others‑‑‑Respondents
Writ Petitions 'Nos.1787, 1802, 1809 and 1810 of 1998, decided on 13th July, 1999.
(a) North‑West Frontier Province Bus Stands and Traffic Control (Peshawar) Ordinance (VII of 1978)‑‑‑
‑‑‑‑Ss. 3 & 10‑‑‑West Pakistan Motor Vehicles Rules, 1969, R.253‑‑‑Constitution of Pakistan (1973), Arts. 18 & 199‑‑‑Constitutional petition‑‑Freedom of trade business or profession‑‑‑Shifting of bus stand‑‑‑Order shifting of bus stands (Addas) to another specified place, passed by Authorities on account of tremendous rush and traffic problems‑‑‑Shifting of bus stand, if bona fide and to control the traffic, was not violative of ‑8.253 of West Pakistan Motor Vehicles Rules, 1969‑‑‑Contention was that such shifting would tantamount to denying a right of business and profession guaranteed under Art.18 ‑ of the Constitution of Pakistan (1973)‑‑‑Validity‑‑‑Article 18 of the Constitution was not attracted since by shifting bus stands, no financial loss was likely to accrue to the petitioners.
(b) North‑West Frontier Province Bus Stands and Traffic Control (Peshawar) Ordinance (VII of 1978)‑‑‑
‑‑‑‑Ss. 3 & 10‑‑‑West Pakistan Motor Vehicles Rules, 1969, R.253‑‑Constitution of Pakistan (1973), Arts.18 & 199‑‑‑Constitutional petition ‑‑Shifting of bus stands‑‑‑Exemption‑‑‑Petitioner had claimed that his bus stand could not be shifted to another specified place as bus stand used by him was his personal property and he could not have been deprived of use thereof‑‑Validity‑‑‑Provisions of S.3, North‑West Frontier Province Bus Stand and Traffic Control (Peshawar) Ordinance, 1978 had provided that no bus stand could be established or maintained within certain specified limits without permission of the Authority‑‑‑When said establishment or maintenance was subject to control exercised by the Authority, it would become altogether meaningless whether bus stand was established on one's personal property or on the rented property‑‑‑Personal property with reference to establishment of bus stand had no significance and could not be established beyond provisions of S.3, North‑West Frontier Province Bus Stand and Traffic Control (Peshawar) Ordinance, 1978.
Nazir Ahmed v. Town Committee Sahiwal PLD 1976 Lah. 1438; Niaz Muhammad v. Provincial Transport Authority 1989 SCMR 790; Mazhar v. The State 1996 CLC 143 and Pak Naulakha Goods Transport Company v. District Magistrate, Lahore 1988 MLD 261 rel.
(c) North‑West Frontier Province Bus Stands and Traffic Control (Peshawar) Ordinance (VII of 1978)‑‑‑
‑‑‑‑Ss. 3 & 10‑‑‑Constitution of Pakistan (1973), Art.199‑‑‑Constitutional petition‑‑‑Shifting of bus stand‑‑‑Claim for special exemption‑‑‑Petitioner whose bus stand was shifted to another specified place alongwith others, had claimed that he had been given special exemption for establishment of bus stand on his property by Commissioner, Peshawar Division‑‑‑Validity and effect‑‑‑Benefit of exemption as given to petitioner under S.10, North‑West Frontier Province Rug Stands and Traffic Control (Peshawar) Ordinance, 1978, could not be derived by petitioner because said exemption implied idea of restriction‑‑‑Unless there was some restriction of a general nature, no question of exemption would arise‑‑Restriction as well. as power to grant exemption, would bring the phenomenon of bus stand to the status of a licence which could or could not be granted by Authority‑‑‑Any exemption towards the grant of licence, could be withdrawn at any time‑‑‑Grant of exemption claimed by petitioner, could not be of any benefit to him in circumstances.
(d) Constitution of Pakistan (1973)‑‑‑
‑‑‑Arts. 118, 119 & 199‑‑‑Income of Welfare Trust‑‑‑Utilization or control‑‑Constitutional petition‑‑‑Government, despite asserting that property in dispute had never been transferred to Police Welfare Trust, had admitted that income of said property was received by Police Welfare Trust‑‑‑Such act of Government was utterly mala fide, unlawful and without jurisdiction being in total violation of Arts. 118 & 119 of Constitution of Pakistan (1973) which had provided that all revenues received by Provincial Government would go to Provincial Consolidated Fund, custody and disposal whereof would be regulated by act of. Provincial Assembly.
Dr. Abdul Basit Khan assisted by Samiullah Jan and Muhammad Jamil Khan for Petitioners.
M. Sardar Khan, A.‑G. for Respondents.
Dates of hearing: 24th and 25th March, 1999.
PLD 2000 Peshawar 20
Before Talat Qayum Qureshi, J
MUHAMMAD ZARIN ‑‑‑Petitioner
versus
AAMER MEHMOOD‑‑‑Respondent
Civil Revision No. 31 of 1997, decided on 15th November, 1999.
North‑West Frontier Province Pre‑emption Act (X of 1987)‑‑‑
‑‑‑‑S. 13‑‑‑Pre‑emption suit‑‑‑Non‑mentioning of time, place, date and names of witnesses in the plaint in whose presence "Talb‑i‑Muwathibat" was made‑‑‑Both the Courts below concurrently dismissed the suit of the preemptor on ground of non‑mentioning of all such facts‑‑‑Validity‑‑‑Not incumbent upon pre‑emptor to specify in the plaint the time, place, date and names of the witnesses in whose presence "Talb‑e‑Muwathibat" under S.13, North‑West Frontier Province Pre‑emption Act, 1987, was made by the preemptor ‑‑‑Order of the Lower Appellate Court was not sustainable and the same was set aside and the case was remanded to the Trial Court for decision on merits, Amir Jan and 3 others v. Haji Ghulam Muhammad PLD 1997 SC 883 fol.
Muhammad Younis Khan Tanoli for Petitioner.
Muhammad Ismail Khan Tanoli for Respondent.
Date of hearing: 15th November, 1999.
P L D 2000 Peshawar 23
Before Mian Shakirullah Jan and Talat Qayum Qureshi, JJ
Mst. GULNAZ BIBI‑‑‑Petitioner
versus
RAFAQAT ALI SHAH and another‑‑‑Respondents
Writ Petition No.218 of 1999, decided on 25th November, 1999.
(a) Guardians and Wards Act (VIII of 1890)‑‑‑
‑‑‑‑Ss. 17 & 25‑‑‑Constitution of Pakistan (1973), Art.199‑‑‑Constitutional petition‑‑‑Appointment of guardian of minor children‑‑‑Criteria‑‑‑Marriage of parents of the minors had ended in divorce and the minors were living with the mother‑‑‑Father was in habit of drinking alocohol and there was a long list of criminal cases in which he was facing trial‑‑‑Father neither had any source of income, nor he owned any property‑‑‑Mother was graduate and a teacher in a school of good standard and was leading a respectable life and there was nothing on record to indicate that she was woman of bad character‑‑‑Application for appointment of guardian filed by the father was dismissed by the Guardian Judge whereas the Lower Appellate Court accepted the same in appeal ‑‑‑Contention raised by the father was that the mother had contracted marriage with a person stranger to the minors‑‑Validity‑‑‑Basic criteria for the appointment of the guardian and the restoration of the custody was welfare of the minors‑‑‑While dealing with such an application. the Court had to pass its findings on the conditions laid down in Ss. 17 & 25 of Guardians and Wards Act, 1890‑‑‑Right of parents regarding the interest and control of the children was not to be exercised in the interest and the benefits of the parents but in the interest and welfare of children themselves‑‑‑Father was, though, a natural guardian yet his right was also subordinate to the welfare of the minors‑‑‑Lower Appellate Court had failed to consider the fundamental criteria of welfare of the minors while dealing with appeal filed by the father‑‑‑Re‑marriage of the mother did not disqualify her for the etlstody of her children in circumstances‑‑‑Factors of re‑marriage of a woman and custody of minors had not been made reciprocal to Guardians and Wards Act, 1890‑‑‑Order passed by Lower Appellate Court was set aside. and that of the Guardian Judge was restored.
Mst. Imtiaz Begum v. Tariq Mahmood 1995 CLC 800; Shaghufta Bano v' Musarrat Hanif and others 1982 CLC 1821; Mst. Janatan v. Abdul Hameed 1984 CLC 345; Mst. Nighat Firdous v. Khadim Hussain 1998 SCMR 1593; Maqsood Ahmad v. Mahmood Khalid 1995 SCMR 1225; Mst. Zar Bibi v. Haji Malik Abdul Ghaffar 1998 MLD 1697; Captain S.M. Aslam v. Mst. Rubi Akhtar 1996 CLC 1; Sh. Abdus Salam v. Additional District Judge 1988 SCMR 608; Ghulam Qadeer and others v. Mst. Rahat Yasmin and others PLJ 1996 Lah. 407 and Zohra Begum v. Sheikh Latif Muhammad Munawar PLD 1965 Lah. 695 rel.
(b) Guardians and Wards Act (VIII of 1890)‑‑‑
‑‑‑‑Ss. 17 & 25‑‑Appointment of guardian and custody of minor children‑‑‑Paternal aunt, a substitute of mother‑‑‑Validity‑‑‑Father of the minor children applied for their guardianship and only female in his house to look after the minors was his sister‑‑‑Effect‑‑‑Sister of father could not be a substitute of mother as she could not provide the love and affection to the children which the mother could ‑‑‑Custody of minors was not given to the father in circumstances.
(c) Guardians and Wards Act (VIII of 1890)‑‑‑
‑‑‑‑Ss. 17 & 25‑‑‑Appointment of guardian and custody of minor children‑‑Preference of minors‑‑‑Scope‑‑‑Where a minor was capable of making an intelligent preference then alongwith the welfare of minors that preference should also be considered by the Court under the provisions of S.17(3) of Guardians and Wards Act, 1890.
(d) Guardians and Wards Act (VIII of 1890)‑‑‑
‑‑‑‑Ss. 17 & 25‑‑‑Retaining the custody of minor children‑‑‑Mother contracting second marriage, has right to retain the custody of minors‑‑Scope‑‑‑Marriage of mother with a person not related to the minors and who was a stranger, would not disentitle and disqualify her to retain the custody of the minors on such ground provided welfare of minors lay in their remaining in the custody of their mother‑‑‑Mother was entitled to retain the custody in circumstances.
Shaghufta Bano v. Musarrat Haneef and others 1982 CLC 1821; Mst. Janatan v. Abdul Hameed and others 1984 CLC 345; Ghulam Qadeer and others v. Mst. Rahat Yasmin and others PLJ 1996 Lah. 407; Mst. Shahida Kausar v. Mst. Sardar Begum 1997 MLD 965 and Muhammadan Law by Ameer Ali, Vol. II, 1976 Edn., p.280 rel.
Alhaj Sardar Moazzam for Petitioner.
Muhammad Ayub for Respondents.
Date of hearing: 14th October, 1999.
P L D 2000 Peshawar 35
Before Mian Shakarullah Jan and Talat Qayum Qureshi, JJ. .
Hafiz ABDUS SALAM and 3 others‑‑‑Petitioners
versus
HUSSAN‑DIN and 11 others ‑‑‑ Respondents
Writ Petition No. 147 of 1996, decided on 25th November, 1999.
(a) Civil Procedure Code (V of 1908)‑‑‑
‑‑‑‑0. V, R.20‑‑‑Issuance of summons‑‑‑Publication in newspapers‑‑Substituted service‑‑‑Scope‑‑‑Defendant could not be served through ordinary means of service, and Trial Court ordered for the service through publication in newspapers‑‑‑Validity‑‑‑Such mode of service, held, was valid and proper under O. V, R.20, C. P. C.
Sheikh Abdul Haq v. Syed Muhammad Anwar PLD 1979 Lah. 332 and Abdul Haq v. Muhammad Azam 1988 MLD 1254 ref.
(b) Civil Procedure Code (V of 1908)‑‑‑
‑‑‑‑0. IX, R. 13‑‑‑Ex parte decree, setting aside of‑‑‑Irregularity in service of summons‑‑‑Effect‑‑‑Defendant having been properly served with summons, ex parte decree could not be set aside merely on ground of any irregularity in service of summons‑‑‑Ex parte decree was not set aside in circumstances.
Sheikh Abdul Haq v. Syed Muhammad Anwar PLD 1979 Lah. 332; Abdul Haq v. Muhammad Azam 1988 MLD 1254 and Zafrul Haq v. Waris Iqbal and another PLD 1979 Lah. 793 ref.
(c) Civil Procedure Code (V of 1908)‑‑
‑‑‑‑0. IX, R.13‑‑‑Constitution of Pakistan (1973), Art. 199‑‑‑Constitutional petition‑‑.Ex parte decree, setting aside of‑‑‑Decree was passed in year 1970 by the Trial Court and satisfied in year 1971, when the property was auctioned in the execution proceedings ‑‑‑Petitioners who purchased the suit property in year 1973 invested huge amount and brought material changes into the same‑‑‑Respondent had the knowledge of passing of ex parse decree against him in year 1975, but he did not bother to approach the Court to get information as to whether any decree had been passed against him‑‑‑Trial Court had set aside the decree on the basis of an application filed by the respondent in year 1978‑‑‑Lower Appellate Court upheld the decision of the Trial Court by dismissing the revision filed by the petitioner ‑‑‑Validity‑‑Although the Lower Appellate Court had admitted that the respondent had the knowledge of pendency of suit against him yet the Court dismissed the revision‑‑‑Application for setting aside decree filed by the respondent was time‑barred‑‑‑Both the Courts below had neither properly appreciated the material available on record as well as the evidence led by the parties, nor judicial mind was applied 'and the law governing the subject was conveniently ignored by the Court‑‑‑Findings of both the Courts below were based on misreading of evidence and the same were against the provisions of law‑‑‑Orders of both the Courts below were set aside‑‑‑Petition was allowed accordingly.
Sheikh Abdul Haq v. Syed Muhammad Anwar PLD 1979 Lah. 332; Abdul Haq v. Muhammad Azam 1988 MLD 1254 and Zafrul. Haq v. Waris Iqbal and another PLD 1979 Lah. 793 ref.
Muhammad Younas Khan Tanoli for Petitioners.
Alhaj Sardar Bahadur Khan for Respondents.
Date of hearing: 3rd November, 1999.
P L D 2000 Peshawar 47
Before Sardar Muhammad Raza Khan and Malik Hamid Saeed, JJ
GHULAM ZAKRIA QURESHI‑‑‑Petitioner
Versus
Khawaja GHULAM MURTAZA LONE and 2 others‑‑‑Respondents
Writ Petition No. 1854 and Civil Miscellaneous No. 2598 of 1999, decided on '16th February, 2000.
(a) West Pakistan Urban Rent Restriction Ordinance (VI of 1959)‑
‑‑‑‑S. 15‑‑‑Civil Procedure Code (V of 1908), S.115‑‑‑Interlocutory order‑‑Appeal/revision against interlocutory order‑‑‑Maintainability‑‑‑Interlocutory order of Rent Controller could not be challenged in appeal as same was specially barred under S.15, West Pakistan Urban Rent Restriction Ordinance, 1959‑‑‑Revisional jurisdiction under S.115, C.P.C. could also not be invoked because said provision was not applicable to proceedings before Rent Controller.
(b) West Pakistan Urban Rent Restriction Ordinance (VI of 1959)‑‑
‑‑‑‑S., 15‑‑‑Constitution of Pakistan (1973), Art. 109‑‑‑Constitutional petition‑‑‑Maintainability‑‑‑Remedy of appeal being available to petitioner under S.15, West Pakistan Urban Rent Restriction Ordinance, 1959, Constitutional jurisdiction could not be exercised by High Court in favour of petitioner.
Haji Muhammad Zahir Shah for Petitioners.
P L D 2000 Peshawar 48
Before Mian Muhammad Ajmal, C J
Khanzada IFTIKHAR AHMED KHAN‑‑‑Petitioner
versus
THE STATE and another‑‑‑Respondents
Criminal Miscellaneous Application No. 10 of 2000, decided on 15th February, 2000.
Criminal Procedure Code (V of 1898)‑‑‑
‑‑‑‑S. 561‑A‑‑‑Penal Code (XLV of' 1860), S.353/382/387/448/506‑‑Quashing of F.1.R.‑‑‑Inherent jurisdiction of High Court under S.561‑A, Cr.P.C. could be invoked for prevention of abuse of process of Court or to secure ends' of justice‑‑‑Process of Court had not yet commenced as challan of the case against accused had not been put in Court‑‑‑No proceedings being pending in Court, question of abuse of process of Court would not arise‑‑Petition for quashing of F.I.R. not being maintainable, was dismissed in circumstances.
1996 SCMR 186‑ref.
Javed Gohar Khan for Petitioner:
P L D 2000 Peshawar 49
Before Mian Muhammad Ajmal, C J
SHAH NAWAZ KHAN‑‑‑Petitioner
versus
AHMAD KHAN and others‑‑‑Respondents
Review Petition No. 14 of 1999 in Civil Revision No.524 of 1997 and Civil Miscellaneous No, 15 of 1999, decided on 14th January, 2000, Civil Procedure Code (V of 1908)‑‑‑
‑‑‑‑S. 35‑A & O. XLVII, R.1‑‑‑North‑West Frontier Province (Enforcement of Certain Provisions of Law) Act (II of 1989), S.2‑‑‑Compensatory costs‑‑Imposition of‑‑‑Review‑‑‑Imposition of compensatory costs was objected to contending firstly, that S.35-A, C.P.C. had not been extended to Province of North‑West Frontier Province and; secondly, that objection with regard to vexatisness and frivolity of suit was nor taken by defendant at initial stage in his written statement and that no finding of that effect was recorded by Trial Court arid Appellate Court‑‑‑Validity‑‑Both contentions had no force because S.35‑A, C.P.C. was enforced on 28‑5‑1989 vide North‑West Frontier Province (Enforcement of Certain Provisions of Law), Act, 1989 and objection with regard to vexatiousness and frivolity of suit was taken at initial stage in written statement alleging that plaintiff was a chronic litigant and that suit had been filed to harass defendant and issue to that effect was also framed‑‑‑Trial . Court and Appellate Court had discussed that point at length and Trial Court had imposed costs after recording reasons which on appeal was reduced‑‑‑Petition for review was dismissed.
Mian Muhammad Younis Shah for Petitioner.
Miss Nusrat Yasmin for Respondents.
P L D 2000 Peshawar 51
Before Talat Qayum Qureshi, J
Qari MUHAMMAD ASIF‑‑Petitioner
versus
THE STATE‑‑‑Respondent
Criminal Miscellaneous No.274 of 1999, decided on 17th December, 1999.
(a) Criminal Procedure Code (V of 1898)‑‑‑
‑‑‑‑S. 497‑‑‑Penal Code (XLV of 1860), S.377‑‑‑Offence of Zina (Enforcement of Hudood) Ordinance (VII of 1979), S.12‑‑‑Bail‑‑‑Case had been registered with the police without any delay‑‑‑No enmity existed between the parties and false implication of accused in the case was out of question‑‑‑Although no injuries or marks of violence were present on the body of the victim, yet the accused could be guilty under S.377, P.P.C. even in the absence of actual penetration per anus iii a legal sense‑‑Swabs obtained by the Doctor from the anterior were found by the Chemical Examiner to have been stained with semen‑‑‑Bail was declined to accused in circumstances.
Muhammad Ali and another v. The State PLD 1961 Dacca 447 ref.
(b) Penal Code (XLV of 1860)‑‑‑
‑‑‑‑S. 377‑‑‑Sodomy‑‑‑Penetration into anus not essential‑‑‑Penetration into anus would not be essential in every case for constituting an offence under S.377. P.P.C.‑‑‑Entry of the male organ of accused into the artificial cavity between the thighs of the victim amounts to penetration and to carnal intercourse.
Muhammad Ali and another v. The State PLD 1961 Dacca 447 ref.
Muhammad Shafique Awan for Petitioner.
Mazhar Akram Awan for the State.
Date of hearing: 17th December; 1999.
P L D 2000 Peshawar 54
Before Mian Shakirullah Jan and Talat Qayum Qureshi, JJ
MUHAMMAD DAUD‑‑‑Petitioner
versus
Mst: SURRIYA IQBAL and another‑‑‑Respondents
Writ Petition No.338 of 1999, decided on 23rd December, 1999.
(a) West Pakistan Urban Rent Restriction Ordinance (VI of 1959)‑‑‑
‑‑‑S. 13‑‑‑Ejectment of tenant‑‑‑Finding of fact‑‑‑Jurisdiction of Rent Controller‑‑‑Scope‑‑‑Finding of fact is to be reached after complete satisfaction and that too as a result of opportunity having been afforded to the parties concerned to lead evidence, place all the documents which they wish to produce before the Court and to satisfy the Rent Controller one way or the other.
(b) West Pakistan Urban Rent Restriction Ordinance (VI of 1959)‑‑‑
‑‑‑‑S. 13‑‑‑Ejectment proceedings‑‑‑Question of title‑‑‑Jurisdiction of Rent Controller‑‑‑Existence of relationship of landlord and tenant‑‑‑Question of title has no relevance in proceedings in the case before Rent Controller‑‑Point of existence of relationship of landlord and tenant is the determining factor and Rent Controller can hold whether such relationship exists between the parties, after recording pro and contra evidence.
(c) Practice and procedure‑‑
‑‑‑‑ Tribunal or statutory Authority, jurisdiction of‑‑‑Scope‑‑‑Any Tribunal or statutory Authority is required to determine any question which under the law, it has the authority to determine and should decide all the questions arising before it‑‑‑Findings recorded by such Tribunal on the question adjudicated' by it subject to correction or alteration by Appellate or Constitutional forum, are final.
(d) West Pakistan Urban Rent Restriction Ordinance (VI of 1959)‑‑‑
‑‑‑‑S. 13‑‑‑Civil Procedure Code (V of 1908), S.115‑‑‑Ejectment proceedings‑‑‑Question as to ownership of premises in question ‑‑‑Pendency of civil revision‑‑‑Jurisdiction of Rent Controller‑‑‑Pendency of civil revision in High Court would not take away jurisdiction of Rent Controller to proceed further in ejectment proceedings.
Rehmatullah v. Ali Muhammad 1983 SCMR 1064 distinguished.
(e) Civil Procedure Code (V of 1908)‑‑
‑‑‑‑S. 115‑‑‑Revision‑‑‑Scope‑‑‑Civil revision is not continuation of a suit.
(f) West Pakistan Urban Rent Restriction Ordinance (VI of 1959)‑‑‑
‑‑‑‑S. 13‑‑‑Ejectment proceedings‑‑‑Pendency of civil suit regarding ownership of premises in question ‑‑‑Effect‑‑‑Pendency of such suit would not automatically stay proceedings of eviction petition under the provisions of West Pakistan Urban Rent Restriction Ordinance, 1959.
PLD 1991 SC 242; 1994 MLD 601; Muhammad Ishaq v. Syed Muhammad Zubair 1996 MLD 797 and Sub‑Divisional Education Officer v. Vidya Parcharik Mandal 1997 MLD 933 ref.
(g) West Pakistan Urban Rent Restriction Ordinance (VI of 1959)‑‑‑
‑‑‑‑S. 15‑‑‑Constitution of Pakistan (1973), Art.199‑‑‑Constitutional petition against interim order‑‑‑Maintainability‑‑‑Appeal against interim order under S.15 of West Pakistan Urban Rent Restriction Ordinance, 1959 being barred, same clearly indicated that there was ouster clause specifically barring appeal against interim order of Rent Controller as only final order was amenable to appeal‑‑‑Constitutional petition, thus, was not maintainable.
Syed Sagheer Ahmad Naqvi v. Province of Sindh through Chief Secretary, S&GAD, Karachi and another 1996 SCMR 1165; Pakistan Burma Shell Ltd. v. Mrs. Nasreen Irshad and others 1989 SCMR 1892; Abdur Rehman v. Haji Mir Ahmad Khan and another PLD 1983 SC 21 and Zar Faroosh v. Sikandar Aziz and 5 others PLD 1997 Pesh. 64 ref.
(h) Administration of justice‑‑
‑‑‑‑Remedy which is not directly available cannot be sought indirectly through indirect means.
Syed Sagheer Ahmad Naqvi v. Province of Sindh through Chief Secretary, S&GAD, Karachi and another 1996 SCMR 1165; Pakistan Burma Shell Ltd. v. Mrs. Nasreen Irshad and others 1989 SCMR 1892; Abdur Rehman v. Haji Mir Ahmad Khan and another PLD 1983 SC 21 and Zar Faroosh v. Sikandar Aziz and 5 others PLD 1997 Pesh. 64 ref.
(i) West Pakistan Urban Rent Restriction Ordinance (VI of 1959)‑‑‑
‑‑‑‑S. 13‑‑‑Constitution of Pakistan (1973), Art.199‑‑‑Constitutional petition ‑‑‑Ejectment proceedings‑‑‑Delay in disposal of ejectment petition‑‑Equitable relief‑‑‑Entitlement‑‑‑More than a decade had elapsed and eviction' petition was still at very initial stage‑‑‑Conduct of the petitioner/tenant who was mainly responsible for delaying the proceedings before Rent Controller by filing various applications in the case had tried to prolong the proceedings and had also adopted delaying tactics through which he succeeded in prolonging the agonies of the landlady for more than a decade‑‑‑If Constitutional petition had been filed by tenant with mala fide intention to delay the eviction proceedings he had not come to the Court with clean hands and was not entitled to any equitable relief‑‑‑Petition was dismissed in circumstances.
PLD 1995 Pesh. 66; PLD 1998 Kar. 42; PLD 1971 Kar. 514; PLD 1973 SC 49 and 1995 MLD 960 ref.
Mushtaq Ali Tahir Kheli for Petitioner
Malik Fazal‑e‑Hussain and Naz Ellahi Moghal for Respondents
Date of hearing: 23rd December, 1999
P L D 2000 Peshawar 65
Before Mian Muhammad Ajmal, C J
FAQIR KHAN‑‑‑Appellant
versus
KHALID HUSSAIN and others‑‑‑Respondents
First Appeal from Order No.230 of 1998, decided on 4th February, 2000
(a) Cantonments Rent Restriction Act (XI of 1963)‑‑‑
‑‑‑‑S. 17‑‑‑Bona fide personal need of landlord‑‑‑Demand of increase in rent‑‑‑Effect‑‑‑Even if demand of increase in rent was presumed, the same would not cast any shadow on bona fide personal requirement of landlord.
1989 SCMR 1366 ref.
(b) Cantonments Rent Restriction Act (XI of 1963)‑‑‑
‑‑‑‑S. 17(4)(b)‑‑‑Bona fide personal need of landlord‑‑‑Tenant having a premises of his own where he could conveniently shift his business‑‑Landlord was not occupying any shop independently in his own right in the Cantonment area or in the vicinity thereof and had not vacated such a building in the area‑‑‑Rent Controller allowed the ejectment petition and ordered for ejectment of the tenant‑‑‑Validity‑‑‑Landlord having fulfilled requirements laid down by S.17(4)(b) of Cantonments Rent Restriction Act. 1963, tenant was liable to be ejected‑‑‑Rent Controller had properly assessed the evidence on record and came to right conclusion, which did not warrant any interference by High Court‑‑‑Appeal was dismissed accordingly.
(c) Cantonments Rent Restriction Act (XI of 1963)‑‑‑
‑‑‑‑S. 17(6)‑‑‑Bona fide personal need of landlord‑‑‑Penal provision‑‑‑Right of restoration of possession to tenant‑‑‑Scope‑‑‑Provision of S.17(6), Cantonments Rent Restriction Act, 1963, provides a check on, mala fide proceedings of landlord‑‑‑Where the premises is not occupied by landlord within one month from the date of obtaining its possession, the provision ensures a right of restoration of possession to the tenant who has been dispossessed from the premises.
Samiullah Jan for Appellant.
Nemo for Respondent.
Date of hearing: 4th February, 2000.
JUDGMENT
P L D 2000 Peshawar 68
Before Mian Muhammad AJmal, C. J. and Tariq Parvez, J
S. MISAL SHAH‑‑‑Petitioner
versus
IKRAM SHAH and others‑‑‑Respondents
Writ Petition No. 1766 of 1999, decided on 20th April, 2000.
(a) North‑West Frontier Province Tenancy Act (XXV of 1950)‑‑
‑‑‑‑S. 2‑‑‑Constitution of Pakistan (1973), Art. 199‑‑‑Constitutional petition‑‑‑Sale of jointly possessed land‑‑‑Status of tenant‑‑‑Land in dispute originally was under ownership of a lady who was in "Hissadari" possession therein and petitioner was claimed to be a co‑sharer in the land had been recorded as tenant under the said lady‑‑‑Land in dispute having been sold by said lady to respondent by transferring all her rights, petitioner could become a tenant in terms of S.2 of North‑West Frontier Province Tenancy Act, 1950‑‑‑Petitioner who had claimed that he was owner through purchase of certain portion of land in dispute, could seek his remedy against vendor thereof‑‑‑Where co‑sharers were holding possession of defined area i.e. an area acquired through purchase which stood specified in respective mutations, notwithstanding the fact that various owners were co‑sharers, but due to their definite respective titles, it would be within jurisdiction of Court to pass order of their ejectment.
(b) Constitution of Pakistan (1973)‑‑
‑‑‑‑Art. 199‑‑‑Constitutional jurisdiction‑‑‑Scope‑‑‑Finding of fact by as many as three forums, could not be interfered with in Constitutional jurisdiction of High Court.
S. Khurshid Ali assisted by Salim Dil Khan for Petitioner.
Muhammad Alam Khan for Respondent No. l against Pre‑admission Notice.
Date of hearing:.20th April, 2000.
P L D 2000 Peshawar 70
Before Mian Shakirullah Jan, J
NAZIR MUHAMMAD ‑‑‑Applicant
versus
Mst. SHAH ZARINA and 3 others‑‑‑Respondents
Transfer Application No. 12 of 1999, decided on 10th‑March, 2000.
West Pakistan Family Courts Act (XXXV of 1964)‑‑‑
‑‑‑‑S. 25‑A‑‑‑Transfer application‑‑‑Place of residence of wife, question of‑‑‑Suit for dissolution of marriage was filed by wife at place 'B' while that of restitution of conjugal rights filed by husband was pending at place 'M'‑‑Both the parties were residents of place 'M' but suit filed by wife at place 'B' was with the object to harass the husband‑‑‑Due to ill‑will of the husband with some other inhabitants of place 'B' and due to certain litigation which took place between his elders and people of the Ilaqa, husband was not able to prosecute the suit filed by the wife at place 'B' and she was likely to get ex parte decree‑‑‑Effect‑‑‑Apprehension of husband with regard to obtaining of ex parte decree by wife was genuine‑‑‑Where pretext excavated by wife for institution of the suit in a Court other than the one within whose jurisdiction she resided, was baseless, her suit was transferred from place 'B' to place 'M' where suit for restitution of conjugal rights was pending., Kaneez Bibi v. Sooba 1996 CLC 632 ref.
Muhammad Anwar Khan for Applicant.
S. Abdul Bar Sherazi for Respondents.
Date of hearing: 10th March, 2000.
P L D 2000 Peshawar 73
Before Mian Shakirullah Jan and Talat Qayum Qureshi, JJ
Haji MUSHTAQ AHMED KHAN and 2 others‑‑‑Petitioners
versus
GOVERNMENT OF N.‑W.F.P. and 2 others‑‑‑Respondents
Writ Petition No. 114 of 1999, decided on 8th March, 2000.
(a) West Pakistan Motor Vehicles Ordinance (XIX of 1965)‑‑‑
‑‑‑‑S. 119‑‑‑West Pakistan General Clauses Act (VI of 1956), S.22‑‑Framing of Rules‑‑‑Publication and commencement of Rules‑‑Precondition‑‑‑Framing of Rules under S.119, West Pakistan Motor Vehicles Ordinance, 1965‑‑‑Scope‑‑‑Such rule‑making power has been made subject to the condition that the rules are made after previous ,publication‑‑‑Rules so framed have to be published in the Official Gazette and the same came into force on the date of such publication.
(b) West Pakistan Motor Vehicles Ordinance (XIX of 1965)‑‑‑
‑‑‑‑S. 35‑‑‑North‑West Frontier Province (Seizure and Disposal of Motor Vehicles) Rules, 1999, R.8‑‑‑Constitution of Pakistan (1973), Art.199‑‑Constitutional petition‑‑‑Confiscation of vehicles and cancellation of registration certificates‑‑Vehicles owned by petitioners were confiscated by Authorities under the provisions of R.8, North‑West Frontier Province (Seizure and Disposal of Motor Vehicles) Rules, 1999‑‑‑Contention raised by petitioners was that Authorities had given retrospective effect to the rules, as the vehicles were confiscated on 3‑4‑1999 whereas the Rules were enforced on 5‑4‑1999‑‑‑Validity‑‑‑Notification did not have retrospective effect, hence the order of confiscation was void ab initio, illegal and without lawful authority and was unsustainable‑‑‑Such order of confiscation was set aside in circumstances.
Dr. Shahida Nasreen, Additional Medical Superintendent, Services Hospital, Lahore v. University of the Punjab through Vice‑Chancellor PLD 1999 Lah. 207 ref.
(c) North‑West Frontier Province (Seizure and Disposal' of Motor Vehicles) Rules, 1999‑‑
‑‑‑‑R. 9‑‑‑Constitution of Pakistan (1973), Art. 199‑‑‑Constitutional petition‑‑‑Maintainability‑‑‑Non‑availing of remedy of .appeal‑‑‑Right of appeal was provided against order of confiscation of vehicle under the provisions of R.9 of North‑West Frontier Province Rules, 1999‑‑‑Order of confiscation was passed prior to coming into force of the rules ‑‑‑Validity‑‑Where order was passed on. a day when the rules were not in existence, such order was void ab initio.
Sardar Nasir Aslam Khan for Petitioners
Qazi Muhammad Ghazanfer" A.A.‑G. for Respondents
Date of hearing: 24th February, 2000
P L D 2000 Peshawar 78
Before Mian Shakirullah Jan, J
PHOENIX SECURITY SERVICE (PVT.) LTD
through Director Commercial‑‑‑Petitioner
versus
Messrs EMERALD MINING COMPANY (PVT.) LTD
through Managing Director and 5 others‑‑‑Respondents
C. C. No. 8 of 1998,, decided on 20th March, 2000.
Companies Ordinance (XLVII of 1984)‑‑‑
‑‑‑‑Ss. 2(ii), 7, 8, 305 & 309‑‑‑Supreme Court and High Court (Extension of Jurisdiction to Certain Tribal Areas) Act (XXVII of 1973), Ss.2 & 3‑‑Constitution of Pakistan (1973), Arts. 1, 199 & 247‑‑‑Winding up of company‑‑‑Application for‑‑‑Competency‑‑‑Jurisdiction of High Court‑‑Competency of application for winding up of company had been objected to on the ground that the company had its registered office at a place which was in Provincially Administered Tribal Area to which Companies Ordinance, 1984 had not been extended‑‑‑Validity‑‑‑"Court" as defined in S.2(ii) of Companies Ordinance, 1984 would mean "Court" having jurisdiction under the Ordinance‑‑‑Court, according to S.7(1) of Companies Ordinance, 1984, having jurisdiction under the Ordinance was High Court having jurisdiction in place at‑ which registered office of the company was situated‑‑Company Judge, could exercise jurisdiction where jurisdiction of the High Court had been extended‑‑‑Jurisdiction of High Court and Supreme Court having been extended to Provincially Administered Tribal Areas under Ss.2 & 3 of Supreme Court and High Court (Extension of Jurisdiction to Certain Tribal Areas) Act, 1973, High Court had jurisdiction, in the case of the company in circumstances‑‑‑Application for winding up of company was competent and case was ordered to proceed on merits. .
.
Muhammad Ihsan v. Government of Pakistan and others 1999 MLD 1145; Sadbar Khan v. Amir Hussain and another PLD 1995 Pesh. 14; 1997 PTD (Trib.) 283; Ghilaf Gul v. Commissioner of Income Tax/Wealth Tax, Zone‑.B, Peshawar and 4 others 1997 PTD 849; Tilla Gul v. Deputy Collector of Central Excise and Land Customs, Peshawar and 2 others 1996 SCMR 886 and .1986 CLC 2933 ref.
Yahya Khan Afridi for Petitioner.
Jehanzeb Rahim for Respondents.
P L D 2000 Peshawar 83
Before Mian Shakirullah Jan, J
ABDUL RAUF and another‑‑‑Petitioners
versus
Messrs MIFATAH UDDIN FLOUR MILLS (PVT.) LTD. and others‑‑‑Respondents
Company Petition C.C. No.7 of 1999, heard on 13th March, 2000.
(a) Companies Ordinance (XLVII of 1984)‑‑‑
‑‑‑‑‑Ss. 290 & 291‑‑‑Constitution of Pakistan (1973), Arts.89, 247 & 270‑A‑‑‑Ordinances and Orders issued and promulgated by the President of Pakistan‑‑‑Extension to Tribal Areas‑‑‑Petition filed under Ss.290 & 291 of Companies Ordinance, 1984 was objected to on the ground that Companies Ordinance which had not been extended to Tribal Areas, was not applicable in the said Areas and petition filed thereunder was not maintainable‑‑Petitioner had contended that under Art.270‑A of Constitution of Pakistan (1973), all Orders and Ordinances issued and promulgated by the President of Pakistan between 5th day of July, 1977 and 30th December, 1985 had been saved and would remain enforced and Companies Ordinance, 1984 which was promulgated between the said period would not lapse and would be deemed to have been extended to the Tribal Areas‑‑‑Validity‑‑‑Contention of petitioner was repelled because orders passed by the President/Chief Martial Law Administrator and Ordinances promulgated by the President were quite different enactments and were of different efficacy‑‑‑Ordinance promulgated by the President according to Art.89 of Constitution of Pakistan, (1973) could be treated as an Act of Parliament‑‑‑Orders issued by President/Chief Martial Law Administrator, however, could not be treated as similar to the Acts of Parliament‑‑‑No notification was required under Art.247 of Constitution of Pakistan (1973) for extension of such orders to the Tribal Areas but Ordinance promulgated by President would not extend to Tribal Areas unless so extended by separate notification under Art. 247 of the Constitution‑‑‑Companies Ordinance, 1984 which required its extension to Tribal Areas by virtue of Art.247 of Constitution of Pakistan (1973) having not been extended by Notification, same was not applicable to the Tribal Areas where registered office of company was situated.
1993 SCMR 1523; PLD 1990 FSC 26; PLD 1986 Pesh. 166; 1998 MLD 1351; PLD 1986 Pesh. 66 and PLD 1982 FSC 168 ref.
(b) Companies Ordinance (XLVII of 1984)‑‑
‑‑‑‑Ss. 2(ii), 7, 8, 290 & 291‑‑‑Supreme Court and High Court (Extension of Jurisdiction to Certain Tribal Areas) Act (XXVII of 1973), Ss.2 & 3‑‑Constitution of Pakistan (1973), Arts.89, 199, 247 & 270‑A‑‑‑Application for control and management of a Mill‑‑‑Maintainability‑‑‑Jurisdiction of High Court to Tribal Areas‑‑‑‑Maintainability of said application was objected to on the grounds of lack of territorial jurisdiction by High Court since office of the Company was situated in Provincially Administered Tribal Areas where jurisdiction of High Court had not been extended and that Mill in question was not property of the company, but was a different entity‑‑Contention that High Court had no jurisdiction in the matter, was repelled in view of fact that jurisdiction of Peshawar High Court and Supreme Court had been extended to Provincially Administered Tribal Areas by Supreme Court and High Court (Extension of Jurisdiction to Certain Tribal Areas) Act, 1973‑‑‑Territorial jurisdiction of High Court, in circumstances, could not be disputed‑‑‑Petitioners in their application under Ss.290 & 291 had claimed the management and control of a Mill which was not property of the company, but was a separate unit‑‑‑Court could assume jurisdiction only when dispute related to the company and not the unit which was not property of the company‑‑‑High Court, in circumstance, could not exercise its jurisdiction over the Mill in circumstances.
1996 SCMR 886 and 1986 CLC 2933 ref:
Abdul Rauf Rohaila for Petitioner.
Samiullah Jan and Hamid Farooq Durrani for Respondents.
Date of hearing: 13th March, 2000.
P L D 2000 Quetta 1
Before Mir Muhammad Nawaz, Marri and Fazal‑ur‑Rehman, JJ
SHAH WALI‑‑‑Appellant
versus
THE STATE‑‑ Respondent
Criminal Appeal No. 154 of 1999, decided on 14th September, 1999.
West Pakistan Arms Ordinance (XX of 1965)‑‑‑
‑‑‑‑S. 13‑E‑‑‑Criminal Procedure Code (V of 1898), 5.103‑‑‑Non‑complrancc‑ of provisions of S.103, Cr.P.C.‑‑‑Recovery of Kalashnikov and two spare magazines, from the accused‑‑‑Prosecution failed to explain as to why two witnesses (Mashirs) from the public were not associated‑‑‑No other reliable piece of evidence which could corroborate the said recovery was produced by the Prosecution except the police officials‑‑‑Effect‑‑‑Due to non‑compliance of the mandatory provisions of S.103, Cr.P.C. and without any reliable corroborative evidence, the recovery was doubtful‑‑‑Conviction and sentence awarded by Trial Court was set aside and accused was acquitted.
PLD 1997 SC 408 ref.
Tahir Mahmood Khan for Appellant.
Shabnum Allah Din Paracha for the State.
Date of hearing: 8th September, 1999.
P L D 2000 Quetta 6
Before Fazal‑ur‑Rehman, J
ABDULLAH‑‑‑Appellant
versus
ALI JAN and 3 others‑‑‑Respondents
Civil Miscellaneous Appeal No. 16 of 1999, decided on 29th October, 1999.
(a) Civil Procedure Code (V of 1908)‑‑‑
‑‑‑‑0. XXXIX, Rr. 1 & 2‑‑‑Interim injunction, grant of‑‑‑Duty of Court granting injunction‑‑‑Scope‑‑‑Grant of injunction is a serious matter and Courts should always take good care while granting an injunction which should be granted in case only where such an injunction is essential.
(b) Civil Procedure Code (V of 1908)‑‑‑
‑‑‑‑0. XXXIX, Rr. 1 & 2‑‑‑Interim injunction, grant of‑‑‑Suit for declaration and possession‑‑‑Defendant was .in possession of suit property, the documents, electric connection and electric bills were also in the name of the defendant‑‑‑Trial Court dismissed the application for grant of interim injunction filed by plaintiff ‑‑‑Validity‑‑‑Observations in orders arising in proceedings of temporary injunction were only tentative in nature and did not prejudice the case on merits‑‑‑Where no irreparable loss was likely to be caused to the plaintiff in case of refusal of injunction, Trial Court had exercised its discretion properly and had not acted illegally or arbitrarily in rejecting application for temporary injunction and as such, the order did not call for interference.
Javed Iqbal and Ahmed Khan Lashari for Appellant.
Ghulam Mustafa Mengal for Respondents.
Date of hearing: 15th October, 1999.
JUDGMENT
Appellant Abdullah filed a suit for possession, declaration and injunction against the respondents restraining them from using, operating and interference with the disputed property and also praying for mesne profit before the learned District Judge, Usta Muhammad. Alongwith the suit he filed application under Order 39, Rules 1 and 2 read with section 151, C.P.C. for injunction for restraining the respondents from interference with the disputed Property. Initially ad interim injunction was granted and after obtaining written statements and rejoinder and hearing the learned counsel for the parties, the order dated 6‑4‑1999 was vacated and the application was accordingly dismissed by the learned Incharge District Judge, Usta Muhammad on 16‑4‑1999. Hence this appeal.
Learned counsel for the appellant submitted that the trial Court has failed to consider the application for injunction in accordance with law, that the trial Court has failed to appreciate the fact that the plot on which the Flour Mill has been installed has not been mutated/entered in the name of the respondents. He has stated that the claim of the defendants/respondents is based on a forged document and the Iqrarnama is also not legal one. He has submitted that the Registrar of District Jafferabad has been approached for the cancellation of registration.
On the other hand learned counsel for the respondents has contended that it is an admitted position that the respondents/defendants are in possession of the disputed property, the documents, electric connection, electricity bills are in the name of respondents and there is also a certificate of the Chief Officer Municipal Committee, Usta Muhammad. It has been contended that in order to decide an application for grant of injunction, three ingredients have to be taken into consideration i.e: whether the plaintiff has a prima facie case in his favour, whether the balance of convenience is in his favour and he is likely to suffer any irreparable loss. Learned counsel for respondents has contended that prima facie the plaintiff has no case as the documents, bills, receipts etc. show that the plot in suit, and construction of flour mill therein stand in the names of the defendants. He has, therefore, supported the order of~ the lower Court. In his order learned trial Court has observed as under:‑‑
"The flour mill and its place is in possession of defendant. Besides, this the flour mill is twining since long time. If the stay is confirmed the irreparable loss will be caused to the defendant. Therefore, the balance of convenience lies in favour of defendant. In view of the above discussion the application under Order 39, Rules 1 and 2, C.P.C. is hereby dismissed and order dated 6‑4‑1999 passed by this Court is vacated. "
?4. I have considered the submissions made by the learned counsel for the parties. I have not been able to pursuade myself to agree with the contentions of learned counsel for the appellant, 1 find that the trial Court has applied its mind to the facts of the case and to the relevant provisions of law and has come to the conclusion that irreparable loss would be caused to the defendants in case the stay is confirmed as according to the learned Judge the balance of convenience lies in favour of defendants. In the circumstances the plaintiff was not likely to suffer irreparable loss. The trial Court has given sound reasons in support of the conclusions arrived at by it On my independent assessment, 1 do not see any reason to disagree with the findings of the trial Court.
5.???????? Grant of injunction is a serious matter and. Courts should always take good care to grant an injunction in case only where such an injunction is A essential. There is nothing that the Court had failed to exercise jurisdiction on the question of well‑established principles of law. It may be pointed out that the observations in orders arising in proceedings of temporary injunction only tentative and do not prejudice case on merits. In the circumstances of present case no irreparable loss would be caused to the appellant/plaintiff in case of refusal of injunction.
H.B.T./788/Q?????????????????????????????????????????????????????????????????????????????????????????????????????????????? Appeal dismissed.
P L D 2000 Quetta 8
Before Fazal‑ur‑Rehman, J
SAWALI and another‑‑‑Petitioners
versus
GUL MUHAMAMD and another‑‑‑Respondents
Civil Revision No.346 of 1998, decided on 20th October, 1999.
Civil Procedure Code (V of 1908)‑‑‑
‑‑‑‑S. 115‑‑‑Dastoor‑ul‑Amal Diwani Riyasat Kalat, 1952‑‑‑Revision‑‑Concurrent findings of fact by both the Courts below‑‑‑Exercise of revisional jurisdiction by High Court‑‑‑Scope‑‑‑Court of Qazi under provisions of Dastoor‑ul‑Amal Diwani Riayasat Kalat, 1952, was bound to decide the matter in accordance with Shariat‑‑‑Both the Courts below had analysed the evidence on record and High Court could not substitute the conclusion which was concurrently and reasonably drawn by the Courts below by proper appreciation of the evidence‑‑‑Where no error of law or defect in procedure had been committed in coming to a finding of fact, High Court could not substitute such finding with its own merely because a different finding could be given‑‑‑Petitioners failed to point out any jurisdictional defect in the judgments and decrees of both the Courts below or any irregularity or illegality warranting interference in such matter in exercise of revisional jurisdiction‑‑‑Revision being without merit was dismissed accordingly.
1997 SCMR 1139 and 1993 MLD 643 ref, Salahuddin Mengal for Petitioners
Muhammad Noor for Respondents.
Date of hearing: 29th September, 1999
JUDGMENT
This civil revision petition under section 115, C.P.C. is directed against the judgment and decree of the learned Majlis‑e‑Shoora, Makran Division at Turbat dated 31‑8‑1998 whereby, the appeal filed against the judgment and decree dated 30‑4‑1998 passed by the learned Qazi, Pasni, was dismissed.
Briefly stated the facts of the case are that the respondent Gul Muhammad filed a suit in the Court of Qazi, Pasni, on 2‑6‑1997 against the petitioners in respect of the property, the description of which is given in the plaint. The suit was resisted by the petitioners by filing written statement on 17th June, 1997.
Out of the pleadings of the parties the learned Qazi on 23rd June, 1997 framed the following issues:‑‑
It is stated that an amended suit was filed on 13‑12‑1997 and written statement by the petitioners was filed on 28‑2‑1998.
In support of his case respondent/plaintiff produced six witnesses and also got recorded his statement on oath. The petitioners produced three witnesses and Shahdad also got recorded his statement. The learned Qazi Pasni on the assessment of evidence brought on record decreed the suit in favour of the plaintiff/respondent on 30‑4‑1998. Aggrieved by the above judgment and decree. the petitioners/appellants preferred an appeal before the learned Majlis‑e‑Shoora, Makran Division at Turbat.
The learned Majlis‑e‑Shoora after hearing the arguments of learned counsel for the parties and examining the record came to the conclusions that the judgment of the lower Court was in accordance with law and according to Shariat. The relevant portion of the conclusion drawn by the Majlis‑e‑Shoora is reproduced below for the sake of facility:‑‑
The judgment of dismissal of the appeal of the petitioners is subject‑matter of the present civil revision which has been filed under section 115, C.P.C.
I have heard Mr. Salah‑ud‑Din Mengal, Advocate, learned counsel for the petitioners and Mr. Muhammad Noor, Advocate for respondent. An application was, however, filed by respondent No.2 Gajian who was also defendant in the civil suit to the extent that he has got no concern with the disputed land.
The main contentions put forth on behalf of the petitioners are that the learned Qazi did not comply with the provisions of Order 20, Rule 5, C.P.C. The trial Court had given permission for amendment without adopting the proper procedure, the Courts below have not appreciated the evidence produced by the petitioners. The learned Majlis‑e‑Shoora did not comply with the provisions of Order 41, Rule 31, C.P.C. The learned counsel has also contended that in the garb of illegal claim the plaintiff/respondent wanted to illegally occupy the land belonging to the petitioners. Learned counsel has submitted that it was a fit case for remand.
On the other hand learned counsel for the respondent has supported both the judgments and submitted that no objection was raised in the written statement regarding amended plaint and moreover, the nature of the suit was not changed. According to learned counsel amendment cart be made at any stage. In the instant case the statements of the parties were yet to be recorded and had the opportunity of raising objection but no objection was raised. He has further stated that since the nature of suit ways not changed, therefore, there was no need for framing of fresh issues nor any application was moved to the trial Court for framing of issue. Learned counsel has also contended that neither in the memo. of appeal veracity of evidence has been objected nor in the petition it has been stated that there is misreading or non‑reading of material evidence. Learned counsel has also submitted that learned Qazi has discussed each issue and similarly Majlis‑e‑Shoora have also discussed the issue and upheld the judgment and decree of the lower Court, therefore, there is nothing which can indicate that the Majlis‑e‑Shoora did not comply with the Order 41, Rule 31. It has also been contended that the documents filed by the plaintiff/respondent No. l exhibited and considered by the trial Court were not annexed with the revision petition. It may be stated that according to Order 6, Rule 17, the‑Court at any stage of proceedings can allow either party to alter or amend his pleadings in such manner and on such terms as may be just and all such amendments shall be made as may be necessary for the purpose of determining the real question in controversy between the parties. .
Learned counsel for the petitioners has failed to point out any irregularity or illegality warranting, interference in this matter in the exercise of revisional jurisdiction. Learned counsel for respondent has also relied upon the authorities reported in 1997 SCMR 1139 and 1993 MLD 643.
The Courts below have analysed the evidence on record and this l Court cannot substitute the conclusions which were concurrently and reasonably drawn by the learned Courts below by proper appreciation of the evidence. If no error of law or defect in procedure had been committed in coming to a finding of fact, the High Court cannot substitute such a finding merely‑because a different finding could be given.
The observations made by the Hon'ble Supreme Court in the authority reported in 1997 SCMR 1139 are noteworthy and the relevant portion of which is reproduced below for the sake of facility:‑
"Before considering the contentions of the parties on merit, we would like to mention here that the scope of interference with concurrent findings of fact by the High Court in exercise of its revisional jurisdiction under section 115. C.P.C. is very limited. The High Court while examining the legality of the judgment and decree in exercise of its bower under section 115. C P C cannot upset a finding of fact, however, erroneous it may be on reappraisal of evidence and taking a different view of the evidence. Such findings of facts can only be interfered with by the High Court under section 115, C.P.C. if the Courts below have either misread the evidence on record or while assessing or evaluating the evidence have omitted from consideration some important piece of evidence which has direct bearing on the issues involved in the case. The findings of facts will also be open to interference by the High Court under section 115, C.P.C. if the approach of the Courts below to the evidence is perverse meaning thereby that no reasonable person would reach the conclusions arrived at by the Courts below on the basis of the evidence on record. "
According to the provisions of Dastoor‑ul‑Amal Dewam Riasat Kalat, 1952 the Court of Qazi is bound to decide the matter in accordance with Shariat. The learned counsel has not been able to point out any jurisdictional defect in the impugned judgment and decree of the Courts below or any irregularity or illegality warranting interference in this matter le in the exercise of revisional jurisdiction.
For what has been stated above, I do not find any merit in this revision petition and the same is accordingly dismissed but with no order as to costs.
Q.M.H./M.A.K./787/Q Revision dismissed.
P L D 2000 Quetta 12
Before Muhammad Javed Iqbal, J
Mst: MARIAM SULTANA‑‑‑Applicant
versus
THE STATE‑‑‑Respondent
Criminal Miscellaneous Application No.4 and Criminal Revision No.4 of 1998, decided on 26th March, 1999.
(a) Criminal Procedure Code (V of 1898)‑‑‑
‑‑‑‑Ss. 190(1)(3) & 202‑‑‑Penal Code (XLV of 1860), S.302‑‑‑Filing complaint directly before Sessions Court‑‑‑Effect‑‑‑Sessions Court could not take cognizance of a complaint filed directly which should first be filed before Magistrate having territorial jurisdiction ‑‑‑Magistrate had to take cognizance under S.190(3), Cr.P.C., not for commencing the trial, but in order to ascertain as to whether case was one which required to be sent for trial to court of Session or was one which he could proceed to try himself‑‑Where a private complaint under S.302, P.P.C., was filed directly before Sessions Judge, he should return same for prosecution to a Magistrate and Sessions Judge could take cognizance on report of Magistrate under 5.202, Cr.P.C.‑‑‑Sessions Judge before whom complaint was directly filed referred same to Additional Sessions Judge who sent same for further enquiry to Judicial Magistrate under 5.202, Cr.P.C.‑‑‑Validity‑‑‑Procedure adopted by Sessions Judge, was not strictly in accordance with law, but since no prejudice, whatever, had been caused to any one, irregularity could be ignored.
1984 PCr.LJ 1373 and PLD 1984 SC 29 ref.
(b) Criminal Procedure Code (V of 1898)‑‑‑
‑‑‑‑Ss. 173, 200 & 203‑‑‑Police report and private complaint ‑‑‑Distinction‑‑Police report required to be filed under S.173, Cr.P.C., was different to that of private complaint and it was not interchangeable‑‑‑Complaint could not be said to have been legally disposed of by taking no action thereon in view of Police report without any order thereon or by promptly passing orders without examining complainant and without following procedure laid down.
AIR 1929 Mad. 849; PLD 1983 FSC 497 and PLD 1983 FSC 497 ref.
(c) Criminal Procedure Code (V of 1898)‑‑‑
‑‑‑‑S. 193‑‑‑Cognizance of offence by Court of Session‑‑‑Provisions of S.193, Cr.P.C., had imposed an embargo upon a Court of Session to take cognizance of any offence unless accused had been sent to said Court of Session by a Magistrate duly empowered in that behalf‑‑‑Enquiry report conducted by Magistrate, was not binding on the Sessions Judge and Sessions Judge could take any view as could be deemed fit and proper in accordance with law‑‑‑Report should be considered either way to decide as to whether process to procure attendance of accused should be issued or not.
1984 PCr.LJ 2546; 1983 PCr.LJ 1051; PLD. 1959 Lah. 660; 1980 PCr. LJ 500; 1988 PCr. LJ 2169; 1983 PCr. LJ 2241 and 1982 PCr. LJ 498 ref.
Mrs. Iqbal Bano for Applicant.
Imran ul Haq for the State.
Date of hearing: 19th March, 1999.
JUDGMENT
This is a revision petition filed by Mst. Mariam Sultana widow of Javed Iqbal presently confined at District Jail, Quetta, against the order dated 14‑11‑1998 whereby private complaint filed by the petitioner has been dismissed.
Briefly stated the facts of the case are that a private complaint has been filed by the petitioner namely Mst. Mariam Sultana against accused/respondents Muhammad Saleem, Sharafat, Shahnaz wife of Muhammad Saleem, Mir Rasool Bakhsh Rind, S.H.O. Police Station Sariab, Quetta, alleging therein that she has falsely been involved in a concocted case of murder at the behest of Muhammad Saleem and Sharafat by Mr. Rasool Bakhsh Rind, 1.P./S.H.O. Police Station Sariab, Quetta, who has conducted the investigation in partial manner and in order to oblige the main culprits certain lacunas have been left deliberately in the investigation and to make the murder case weak, she has been involved by whom initially an attempt was made to lodge report regarding missing of her husband namely Javed Iqbal who was subsequently found dead and his dead body was recovered at the pointation of accused persons namely Muhammad Saleem and Sharafat. In this regard accused namely Muhatnmad Saleem has got .recorded his confessional statement soon after the occurrence implicating the petitioner in the commission of alleged offence by assigning her the role of abetment and according to him the murder was committed at her behest as accused Sharafat had developed illicit relations with her, and thus, Javed lqbal, the husband of complainant was done to death. A case was accordingly got registered under section 302/109/34, P.P.C. against Muhammad Saleem, Sharafat and Mst. Mariam Sultana (petitioner). As mentioned earlier the private complaint has been dismissed by learned Additional Sessions Judge Vth, Quetta. vide order dated 14‑11‑1998 and relevant portion whereof is reproduced hereinbelow for ready reference;‑‑
"F.I.R. No.175 of 1998 has been lodged against the accused Saleem, Sharafat and complainant. The counsel for the complainant contended that the challan under section 173, Cr.P.C. is ripe for submission before the competent Court for trial. Prima facie there are no grounds to summon the respondents. The Court is not empowered to order for re‑investigation of the case. Being a Sessions Court this Court is not competent to act under the provisions of section 193, Cr.P.C. Re‑investigation will prima facie destroy the challan case. The form of the complaint in its shape does not attract the provisions of Cr.P.C. The present complaint is mere an application for re‑investigation of the case.
The above observations do not prejudice the case F.1.R. No .175 of 1998 and case of the complainant accused. In the result. the complaint is accordingly dismissed.
File be consigned to record after completion. "
It is mainly contended by Mrs. lqbal Bano, Advocate on behalf of Mst. Mariam Sultana that the private complaint could not have been dismissed in view of evidence as led by the complainant before the learned Judicial Magistrate by whom enquiry was conducted at the direction of learned Additional Sessions Judge Vth, Quetta. It is next contended that the evidence has not been examined and the complaint has been dismissed in violation of the prescribed procedure as enumerated in sections 200 to 204, Cr.P.C. It is urged with vehemence that submission of Police Challan would have no bearing on the private complaint which should have been disposed of in accordance with law and on the basis of its own merits. It is pointed out that a poor woman has been involved falsely by Rasool Bakhsh Rind. S.H.O., Police Station Sariab, without any incriminating material. In order to substantiate the partial investigation got conducted by Mir Rasool Bakhsh Rind it is pointed out that in order to provide undue advantage to accused Muhammad Saleem, his confessional statement was got recorded in a hurry and subsequently he was sent to judicial custody and the crime weapon i.e. Chhuri could not be recovered from Sharafat while he remained under custody in police for more than 7 days.
Mr. Imran‑ul‑Haque, Advocate appeared on behalf of State and contended that the prescribed procedure as enumerated in sections 200 to 204, Cr.P.C. should have been followed which could not be done for the reasons best known to the learned Additional Sessions Judge, Vth, Quetta. It is further argued that the learned Additional Sessions Judge, Vth, Quetta, may be directed to act in accordance with law and the report of Judicial Magistrate should be considered. It is, however, pointed out that challan of the case has already been submitted and in case the complainant feels that she has been falsely involved the remedy as provided under section 265‑K, Cr.P.C. could be availed.
I have carefully examined the respective contentions as agitated on behalf of petitioner and for State in the light of relevant provisions of law and record of the case. 1t is worth mentioning that at first instance notice was served upon the accused/respondents to procure their attendance but subsequently it was felt that since the complaint has been dismissed at initial stage without issuance of process to the accused/respondents, as such it would be not necessary to afford them an opportunity of hearing which would be provided by the learned Additional Sessions Judge Vth, Quetta, at appropriate stage if circumstances so justify. A careful scrutiny of entire record would reveal that in fact this complaint should have been filed in the Court of learned Magistrate in view of the provisions as contained in section 190(1), Cr.P.C. and by whom it was to be referred to the learned Sessions Judge in view of the provisions as contained in section 190(3), Cr.P.C. as the alleged offence was exclusively triable by learned Sessions Judge. It is to be noted that "a Sessions Court cannot take cognizance of a complaint filed directly before it which should first be filed before a Magistrate having territorial jurisdiction in the matter so that he can take cognizance under section 190(3), Cr.P.C. not for commencing the trial but in order to ascertain as to whether the case is one which is required to be sent for trial to the Court of Session or is one which he can proceed to try himself. Where a private complaint under section 302, P.P.C. is filed directly before the Sessions Judge he should return it for presentation to a Magistrate" (1984 PCr.LJ 1373). He may take cognizance on the report of a Magistrate under section 202 (PLD.1984 SC 29. The complaint file by Mst. Mariam Sultana before learned Sessions Judge should have been referred to a Magistrate for the purpose of cognizance as enumerated under section 190(3), Cr.P.C. which could not be done but it was referred to learned Additional Sessions Judge Vth, Quetta, who sent it for further enquiry to Judicial Magistrate under section 202, Cr.P.C. and the procedure so adopted was not strictly in accordance with law but since no prejudice whatsoever has been caused to anyone, therefore, the said irregularity can be ignored. The report of Judicial Magistrate has been examined with care and caution which corroborates the version of complainant as per conclusion derived by the learned Magistrate. A thorough scrutiny of the impugned order dated 14‑11‑1998 would reveal that the learned Additional Sessions Judge Vth, Quetta, has referred the enquiry report got conducted by him and did not disagree with it but the complaint has been dismissed mainly for the reasons that since challan of the case wherein the petitioner has been shown as accused was filed as such it was beyond the competency of the learned Court to order for re‑investigation of the case. It also prevailed upon the learned Sessions Judge Vth, Quetta, that "being a Sessions Court this Court is not competent to act under the provisions of section 193, Cr.P.C. Reinvestigation prima facie destroys the challaned case". The abovementioned findings are neither in consonance with law nor appeal to logic. It is to be noted that Police report which is required to be filed under section 173, Cr.P..C. is different to that of private complaint and it is not interchangeable. There is no cavil to the proposition that a complaint cannot be said to have been legally disposed of by taking no action thereon in view of the Police report and making no order thereon or by promptly passing orders on it without examining the complainant and without following the procedure laid down (AIR 1929 Mad. 849, PLD 1983 SC 497, PLD 1983 FSC 497). It is worth mentioning that the provisions as contained in section 203, Cr.P.C. are free from any ambiguity and the learned trial Court had to only consider the statements got recorded in support of complaint or the enquiry report got conducted by him but on the contrary the learned Additional Sessions Judge Vth, Quetta, had dismissed the complaint merely on the ground that it would destroy the prosecution case since challan has been submitted which is not tenable under law. In this regard I am fortified by the dictum laid down in 1984 PCr.LJ (Kar.) 2546. I further find support from 1983 PCr.LJ 1051 and relevant portion whereof is reproduced hereinbelow for ready reference which would make the position crystal clear:‑‑
"The plea that while summoning an accused in a complaint, the opinion of the police recorded during investigation should not be ignored rather be given weight so that unscrupulous complainants may not feel free to involve innocent persons in criminal litigation thereby forcing them to undergo rigours of criminal trial, cannot be accepted as the same has neither the support of any authority nor the scheme of the Criminal Procedure Code allows the adoption of the course canvassed by the learned counsel. In Fateh Sher v. Khan Yasin Khan PLD 1959 Lah. 660 it was observed that 'The Magistrate dismissing a complaint under section 203, Cr.P.C. cannot possibly look into reports submitted under section 174 or section 176, Cr.P.C. nor can he dismiss the complaint on the basis of such a report. He could only dismiss the complaint by looking at the complaint and the statement of the complainant on oath and the report and nothing else'. It is the criminal Court itself which has to form an opinion on the basis of material produced before it, on the question whether the allegations made prima facie constitute an offence and as such furnish sufficient ground for proceedings against the accused. The other mode to ask the Court to take cognizance of an offence is by moving a complaint. This mode cannot be rendered ineffective because of the fact that Police during investigation was not able to collect evidence against an accused or otherwise was of the opinion that allegations made are not worthy of credence. As regards the plea that innocent persons should not be made to face the rigours of a criminal trial, it will be seen that the Legislature has made adequate provisions for curbing frivolous, vexatious or malicious complaints. In this connection section 211, Cr.P.C. may be referred. It is also open to the accused who is summoned, to show to the Court that he has been summoned without any reasonable cause or on the basis of insufficient material as he can seek dismissal of the complaint under section 203, Cr.P.C. Even at later stage of the trial he can make out a case of acquittal under section 265‑K, Cr.P.C. Moreover, in case he is able to establish that the proceedings initiated against him were frivolous, unwarranted or mala fide, he can claim compensation under section 250, Cr.P.C. Thus, sufficient provisions have been made to safeguard the interest of the person proceeded against without reasonable cause. I am, therefore, of the view that by taking cognizance of the offence on a complaint, neither the provisions contained in sections 154 to 176 of the Cr.P.C. are rendered nugatory nor the interest of justice, in any way, suffers. "
It also prevailed upon the learned Court that being Sessions Court in view of provisions as contained in section 193, Cr.P.C. the question of reinvestigation cannot be dealt with being out of the purview which seems to be a result of some confusion or misunderstanding. It is well‑settled by now that "section 193 imposes an embargo upon a Court of Session to take cognizance of any offence unless the accused has been sent to such Court of Session by a Magistrate duly empowered in this behalf, 1980 PCr.LJ 500. I am conscious of the fact that an enquiry report got conducted by Magistrate is not binding on the Sessions Judge and he may take any view as may be deemed fit and proper in accordance with law but such report should be considered either way to decide as to whether process to procure the attendance of accused/respondent should be issued or not? 1988 PCr.LJ 2169; 1983 PCr.LJ 2241 and 1982 PCr.LJ 498 but in the‑case in hand the learned Additional Sessions Judge Vth, Quetta, has discussed the entire report which supports and corroborates the version of petitioner but amazingly the complaint has been dismissed on hypertechnical basis. As mentioned earlier the submission of challan would have no bearing on this complaint which is required to be disposed of in accordance with law and the procedure as enumerated in sections 200 to 204, Cr.P.C.
In the light of what has been stated above the impugned order dated 14‑11‑1998 passed by learned Additional Sessions Judge Vth, Quetta is hereby set aside and case is remanded back to learned Additional Sessions Judge Vth, Quetta, for further enquiry in accordance with the procedure as enumerated in section 203, Cr.P.C. The learned trial Court may exercise its discretion without being influenced from the observation made hereinabove but the evidence as led by the petitioner and enquiry report should be reexamined in depth and appropriate order be passed regarding the private complaint filed by Mst. Mariam Sultana. It is pertinent to mention here that murder case got lodged vide F.I.R. No.175 of 1998 and challan submitted which is presently pending trial before learned Additional Sessions Judge‑I, Quetta, is hereby transferred to learned Additional Sessions Judge Vth, Quetta, in order to avoid the possibility of any conflicting view and it was also be in the interest of justice that both the matters should be dealt with by one forum. It is also to be noted that direction was issued vide this Court order dated 16‑12‑1998 that no further proceedings shall be commenced against Mst. Mariam Sultana (petitioner) in case got lodged against her by Mir Rasool Bakhsh Rind, I.P./S.H.O. of Sariab Police Station, vide F.I.R. No. 175 of 1998 under section 302/109/34, P.P.C. is vacated and the learned Additional Sessions Judge Vth, Quetta, is directed to commence with the trial and dispose of the direct complaint filed by Mst. Mariam Sultana (petitioner) in accordance with law.
The observations made hereinabove are tentative in nature and shall not affect the merits of the case.
H.B.T./2/Q Order accordingly.
P L D 2000 Quetta 19
Before Iftikhar Muhammad Chaudhry, C J
THE STATE through Director‑General, Anti‑Norcotics Force, Balochistan‑‑‑Appellant
versus
NASRULLAH and 8 others‑‑‑Respondents
Smuggling Appeal No. l of 1998, decided on 14th October, 1999
(a) Prevention of Smuggling Act (XII of 1977)‑‑‑
‑‑‑‑Ss. 31 & 33‑‑‑Notice to person holding property suspected to be acquired by income from smuggling‑‑‑Obligatory/incumbent upon persons to whom notice was issued to have satisfied Court by producing evidence that property details whereof were mentioned in the list attached to notice, had not been acquired by them by smuggling‑‑‑Burden was upon said persons under provisions of S.33 of Prevention of Smuggling Act, 1977 to clear that properties owned by them through their relatives etc. had not vested in them from income of smuggling.
(b) Interpretation of statutes‑‑‑
‑‑‑‑Principles‑‑‑Police Officer working under provisions of a statute, could not go into the vires of the same.
(c) Judicial review‑‑‑
‑‑‑‑Scope‑‑‑Superior Courts which were creature of Constitution and derived their power and jurisdiction under the Constitution could not claim to be above Constitution or to have right to strike down any provision of the Constitution.
(d) Prevention of Smuggling Act (XII of 1977)‑‑‑
‑‑‑‑Ss. 31, 32, 33 & 43‑‑‑Notice to person holding property suspected to be acquired by smuggling‑‑‑Appeal‑‑‑Competency‑‑‑Special Judge had rejected complaint and withdrawn the notice instead of conceding the request of prosecution to adjourn the matter or to dispose of same even without recording evidence on the basis of the notice so issued‑‑‑Order of Special Court was covered under S.32, Prevention of Smuggling Act, 1977 and appeal against said order was competently filed.
Liaquat Ali and 11 others v. The State 1992 SCMR 372; 1991 SCMR 2457; PLD 1974 Lah. 4476; PLD 1973 SC 49 and 1997 PCr.LJ 1900 ref.
Tariq Mahmood for the State.
M.S. Fakhruddin G. Ebrahim and Ehsanul Haq for Respondents
Date of hearing: 31st May, 1999, JUDGMENT
This appeal has been filed under section 43 of the Prevention of Smuggling Act, 1977 (Act, 1977) against the order dated 10‑3‑1998 passed by Sessions Judge/Special Judge under the Prevention of Smuggling Act, 1977 whereby complaint lodged by Anti‑Narcotics Force, Balochistan through its Director against the respondents with the prayer that properties owned by them or their relatives or associates are reasonably suspected to have been acquired by smuggling within the meaning of clause (f) of section 2 of the Act, 1977 be forfeited to the Federal Government.
Precisely stating facts are that on 27‑8‑1997 complaint referred to hereinabove was instituted alongwith details of documents indicating ownership/propriety rights of Haji Habibullah and others in respect of the property owned by the respondents as well as the copies of F.I.R. to prima facie establish that some of them have remained involved in smuggling therefore, they acquired these properties from its income. However, after the death of Haji Habibullah an advertisement was published for information of legal heirs who were not impleaded in complaint. After publication learned trial Court called upon the prosecution to prove its case against the respondents vide order dated 8‑11‑1997. This order, however, was challenged before this Court in Smuggling Appeal No.l of 1997 which was disposed of on 12‑1‑1998, Relevant para. therefrom is reproduced hereinbelow:‑‑
"In my opinion without entering into merits of the case or maintainability of the appeal it would be sufficient to observe that as far as observations made by the trial Court with regard to the fact that F.I.Rs. are act sufficient to establish that property has been acquired through smuggling are to be tentative in nature because the operative para. indicates that unless evidence is not led by appellant no final order can be passed.
Learned counsel for the respondent also agreed that these observations are of tentative nature and cannot form basis for final determination of the complaint.
For the foregoing reasons and observations made hereinabove appeal is dismissed. However, the trial Court is directed to proceed in accordance with law in terms of the concluding para of the impugned judgment." .
It seems that after remand of the case appellant produced P.W.1 Kamran Yousaf son of Muhammad Yousaf, A.S.‑I. Police Station Sariab who got recorded F.I.R. (Exh.D/1 ‑A) in pursuance whereof respondent No.2 Amanullah son of Habibullah and Qasim were arrested and after the trial they were convicted/sentenced for 2 years' R.1. and fine of Rs.10,000 each. It so happened that thereafter prosecution directed to appellant to produce all their witnesses. It may be noted that on the date of hearing i.e. 5‑3‑1998 respondents admitted ownership of the properties, therefore, there is no need to prove this fact. On this the matter was adjourned for 10‑3‑1998 with directions by the trial Court to appellant to produce witnesses according to the written statement, however, subject to the fact that documents pertaining to the property had been admitted. The record reveals that on this date no one appeared on behalf of appellant and an application was moved for adjournment on the ground that the Advocate was busy, as such vide impugned order learned trial Court dismissed the complaint, concluding para. therefrom is reproduced hereinbelow:
"Whatever the case may be, it is a fact that prosecution is very slow in producing the evidence before the Court. The witness produced has simply endorsed the F.I.R. He orally submitted that perhaps the case has been decided and accused has been convicted for two years' R.I. It is observed that list produced do not contain any word that this property has been acquired by means of smuggling. The word 'smuggling' has been defined under section 2 of the Customs Act. On the basis of allegations and interpretation of smuggling no case is made out that respondents have acquired the properties mentioned in the list of the allegations through smuggling. All the allegations are in respect of narcotics and arms, but there should have been some facts that respondents collected such amount whereby the mentioned properties were purchased. None of the witness listed by the prosecution has been specifically nominated to disclose such facts. The case was filed on 18‑9‑1995: Sufficient time and opportunities have been provided to the prosecution, therefore, in my view further opportunities cannot by provided."
Against the above order instant RPPC41 has been filed under section 43 of the Act, 1977. The learned counsel for parties Mr. Tariq Mehmood and Fakhar‑ud‑Din G. Ebrahim for appellant and respondents respectively filed their written arguments.
On behalf of respondents objection on maintainability of the appeal has been raised to the effect that under section 43 appeals are competent against the orders of a Special Judge passed under sections 31(3), 32 and 34. It was further mentioned that admittedly impugned order is not covered even under section 32, therefore, appeal is not competent.
On the other hand learned counsel for appellant attempting to meet with the objection of learned counsel mentioned in the written arguments that section 43 itself did not restrict the scope of filing of appeal, therefore, according to him the appeal is competent because order falls under section 32 of the Act, 1977 as it tantamount to withdrawing the notice, reliance was placed on 1992 SCMR 372, 1991 SCMR 2457 and PLD 1974 Lahore 4476.
I have gone through relevant provisions of law. It would be appropriate to reproduce section 43 of the Act, 1977:‑‑
"Section 43. Appeal.‑‑(1) Any person aggrieved by an order of the Special Judge passed under section 31, section 32 or section 34 may within thirty days from the date of such order, prefer an appeal before the Special Appellate Court whose decision thereon shall be final, (2) The provisions of the Limitation Act, 1908 (IX of 1908), shall apply to an appeal held under subsection (1). "
Plain reading of above provision suggests that appeal is competent if orders are passed under sections 31, 32 and 34. As far as section 31 is concerned it pertains to issuing of a notice to a person holding property suspected to be acquired by smuggling and the person to whom the notice is issued is required to indicate the sources of his income, and assets out of which or by means of which he has acquired such property, the evidence he relies upon and other relevant information and particulars.. It may be noted that in` terms of this section notice was issued to the respondents reference whereof has been made hereinabove and the perusal of notice also suggest that it was in consonance to the provisions of this section. On receipt of the notice no objection was raised by the respondents as they did not contend as to why notice has been issued to them or satisfaction expressed by the Court is not sufficient to call for action against them, therefore, it can safely be held that act of issuance of notice by the Special Judge was conceded to by respondents. Thus, after this stage section 32 of the Act, 1977 comes into play. According to which the Special Judge may after considering the explanation, if any, to notice issued under section 31 and the evidence recorded or produced before him and after giving the relative or associate of such person, in case a copy of the notice has also been served upon him, reasonable opportunity of being heard by an order record a finding whether the property to which the notice relates is property acquired by smuggling and on having satisfied the Special Judge that any of the properties mentioned in the notice issued under section 31 are not properties by smuggling, but he is not able to specifically identify such property then it shall be lawful for him to specify the properties which to the best of his judgment are .properties acquired by smuggling and to record a finding accordingly under subsection (1) and where a Special Judge records a finding under subsection (1) that any property is the property acquired by smuggling, he shall declare that such property shall subject to the provisions of this chapter stand forfeited to the Federal Government and vest in that Government free from all encumbrances. ‑
In the instant case undoubtedly on receipt of the complaint learned Special Judge found himself satisfied that a notice is required to be issued, therefore, once a notice has been issued it was obligatory incumbent upon the respondents to have satisfied the Court by producing evidence that the property details whereof were mentioned in the list has not been acquired by them by smuggling because under section 33 of the Act, 1977 the burden was upon the respondents to clear that the properties owned by them, through relatives etc. has not vested in them from the income of the smuggling. But in the instant case learned trial Court having adopted this procedure had called upon the appellant to establish/prove that respondents have acquired these properties through smuggling. Thus, the question would be that learned Presiding Officer by adopting a procedure to dispose of the complaint contrary to section 32 had dismissed the complaint, therefore, against such order appeal would be competent.
Mr.Fakharuddin G. Ebrahim learned counsel stated that section 43 of the Act, 1977 does not contemplate a negative finding that the property is not acquired by smuggling and if the Legislature had appended the word "or, not" after the word "whether" it would have been possible to argue with justification that the finding may be either positive or negative and the order made appealable in either case, but in the present case the finding to be given is that the property has been acquired by smuggling and if an order was to that effect it would be appealable but not otherwise.
On the other hand Mr. Tariq Mehmood learned counsel referred to dictionary meaning of the word "whether" according to which introducing the first of two alternatives word phrases or clauses, the second being introduced by or (in the case of clauses sometime by or whether), therefore, he was of the opinion that by use of word "whether" the law‑maker was conscious that order can be that the property is acquired by smuggling or otherwise.
In my opinion under subsection (1), section 32 word "whether" is of great importance. As per its ordinary dictionary meaning it is to be used both in negative and positive purpose. For instance the Special Judge may come to conclusion after considering the explanation of the person to whom the notice was issued or after recording evidence that the property in respect of which notice relates is not acquired by smuggling. Similarly positive finding can also be given, therefore, to meet any of both the circumstances appeal would be competent under section 43 of the Act, 1977.
At this juncture it would be beneficial to make reference to the case of Liaquat Ali and 11 others v. The State 1992 SCMR 372. In this case some of the accused persons were convicted for the criminal charge; whereas few of them were acquitted, therefore, State filed appeal against their acquittal on which the acquitted accused persons filed preliminary legal objections inter alia that appeal filed by Deputy Attorney‑General on behalf of Attorney?General as provided under subsection (5) of section 13 of the Ordinance (Special Courts for Speedy Trials Ordinance, 1991) is not competent. Honourable Supreme Court while attending this question held as follows:‑‑
?On the basis of above sub‑Article (5) of Article 212‑B of the Constitution, it was contended by him that under the Ordinance, an appeal could have been provided against a sentence or a final order of a Special Court and not against an acquittal judgment as it has not been provided in the above‑quoted sub‑Article (5) of Article 212‑B of the Constitution which empowers the making of a provision for an appeal in the law which was to be enacted. The above contention seems to be untenable as the words 'final order of a Special Court' will include an acquittal judgment as well. The use of the word 'sentence' preceding the words 'or final order of a Special Court' does not imply that the law‑makers intended not to provide an appeal against an acquittal judgment. The word 'conviction' is generally used in contrast to the word 'acquittal' and not the word 'sentence' and, therefore, the omission to employ the words 'conviction and acquittal' in above sub‑Article (5) of Article 212‑B of the Constitution is of no consequence. If we were to accept the above contention of Mr. Abdul Aziz Qureshi, it would lead to an illogical conclusion that a provision for providing of an appeal in the relevant law could have been made against a sentence and not against a conviction, which could not be the intention of the law makers. In any case, we are not competent to hold that subsection (5) of section 13 of the Ordinance is ultra vires the provision of sub‑Article (5) of Article 212‑B of the Constitution. In this connection, reference may be made to the judgment of the Supreme Court in the case of Mr. Fazlul Quader Chowdhry and others v. Mr. Muhammad Abdul Haque PLD 1963 SC 486, in which inter alia it has been held that neither the Chief Election Commissioner nor the Speaker could have jurisdiction to question the constitutionality of the impugned order issued by the then President in exercise of power under Article 224 of the erstwhile Constitution of Pakistan, 1962. Reference may also be made to the case of the State v. Zia‑ur‑Rehman and others PLD 1973 SC 49, in which Hamoodur Rahman, J., while dilating upon the question of jurisdiction of the Supreme Court, has made the following observations:
'So far, therefore, as this Court is concerned it has never claimed to be above the Constitution nor to have the right to strike down any provision of the Constitution. It has accepted the position that it is a creature of the Constitution; that it derives its powers and jurisdiction from the Constitution; and that it will even confine itself within the limits set by the Constitution which it has taken oath to protect and preserve but it does claim and has always claimed that it has the right to interpret the Constitution and to say as to what a particular provision of the Constitution means or does not mean even if that particular provision is a provision seeking to oust the jurisdiction of this Court.'
The ratio of the above authorities of the Supreme Court seems to be that an incumbent of a public office acting under certain provisions of a statute cannot go into the vires of the same nor the superior Courts which are the creature of the Constitution and derive their power and jurisdiction under it, claim to be above the Constitution or to have the right to strike down any provision of the original Constitution. "
Similarly in art identical proposition 1997 PCr.LJ 1900 concerning filing of appeal against acquittal order recorded by Sessions Judge in a case pertaining to Offences Against Property (Enforcement of Hudood) Ordinance, 1979 this Court has held:
"A bare perusal of the above reproduced dictum laid down in different cases would reveal that where a case is registered under the Offences Against Property (Enforcement of Hudood) Ordinance (VI of 1979) (hereinafter referred to as the Ordinance) irrespective of FD the fact whether conviction is awarded or acquittal is made the appeal shall lie to Federal Shariat Court except in those cases where conviction is less than 2 years. "
Thus, in view of above two judgments we are of the opinion that in the instant case learned Special Judge under the Act, 1977 rejected the complaint and had withdrawn the notice instead of conceding the request of the prosecution to adjourn the matter or to dispose of the same even without recording the evidence on the basis of the notice issued to respondent and its reply filed by them, therefore, this order shall be covered under section 32 of the Act, 1977 and appeal is held to have been filed competently. ‑
Now adverting to merits of the case suffice to observe that in view of the observations made hereinabove while discussing the provisions of section 32 of the Act, 1977 learned Specials Judge/Sessions Judge adopted a procedure which was not permissible under the law because instead of calling upon the prosecution to adduce evidence to establish that property details whereof was mentioned in the notice was acquired by respondents through smuggling may have satisfied itself on having seen explanation offered by respondents or provide them opportunity to indicate to the Court source of their income and assets out of which or by means of which he/they have acquired such property etc., therefore, in my opinion the order is bad in the eye of law and. deserves to be set aside.
Thus, in view of the above discussion appeal is allowed, impugned order dated 10‑3‑1998 passed by Sessions Judge/Special Judge under Prevention of Smuggling Act, 1977, Quetta is set aside and case is remanded to him far proceedings with the matter afresh keeping in view the observations made hereinabove and according to relevant law.
H.B.T./I/Q?????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? Case remanded.
P L D 2000 Quetta 26
Before Iftikhar Muhammad Chaudhary, C.J. and Aman Ullah Khan Yasinzai, J
SAKHI DOST JAN‑‑‑Petitioner
versus
THE STATE‑‑‑Respondent
Constitutional Petition No.984 of 1999, decided on 10th November, 1999.
(a) Prohibition (Enforcement of Hadd) Order (4 of 1979)‑‑‑
‑‑‑‑Art. 33‑‑‑Customs Act (IV of 1969), S.156‑‑‑Purpose and object of two legislations ‑‑‑Distinction‑‑‑Offences falling within the mischief of both the statutes i.e Customs Act, 1969 and Prohibition (Enforcement of Hadd) Order, 1979, clearly spell out different ingredients.
Jamshed Ali v. The State 1988 PCr.LJ 881 and State v. Anwar Khattak and others PLD 1990 FSC 62 ref. , (b) Constitution of Pakistan (1973)‑‑‑
‑‑‑‑Arts; 13 & 199‑‑‑Criminal Procedure Code (V of 1898), S. 403‑‑‑General Clauses Act (X of 1897), S.26‑‑‑Prohibition (Enforcement of Hadd) Order (4 of 1979), Arts. 3 & 4‑‑‑Dangerous Drugs Act (II of 1930), Ss.8 & 14‑‑Constitutional petition‑‑‑Double punishment for same offence‑‑‑Two separate trials of the petitioners were conducted one under Arts.3 & 4 of Prohibition (Enforcement of Hadd) Order, 1979 and the other under Ss.8 & 14 of Dangerous Drugs Act, 1930‑‑‑Validity‑‑‑Trial of the petitioners under both the statutes was not violative of the provisions of Art. 13 of the Constitution read with statutory laws under 5.403, Cr.P.C. and S.26, General Clauses Act 1.897‑‑‑Double punishment and not the trial was prohibited.
PLD 1998 Lah. 239; PLD 1998 Lah. 307; PLD 1998 Kar. 159; 1997 PCr.LJ 1771; PLD 1993 SC 247; PLD 1983 Lah. 71; PLD 1982 FSC 265; 1981 SCMR 1008; PLD 1961 Lah. 269; PLD 1977 Kar. 144; 1985 PCr.LJ 499; 1987 MLD 1948; 1988 PCr.LJ 881; PLD 1990 FSC 62; 1995 SCMR 626 and 1998 PCr.LJ 1352 ref.
1995 SCMR 626 fol.
(c) Constitution of Pakistan (1973)‑‑‑
‑‑‑‑Art. 247‑‑‑Prohibition (Enforcement of Hadd) Order (4 of 1979), Art. 1 (2)‑‑‑Applicability‑‑‑Prohibition (Enforcement of Hadd) Order, 1979 was applicable to Federally Administered Tribal Areas.
PLD 1986 Pesh. 166 ref.
1993 SCMR 1523 fol.
Khalid Ranjha and Amanullah Kanrani for Petitioner. Tariq Mahmood for Respondent.
Date of hearing: 10th November, 1999.
JUDGMENT
IFTIKHAR MUHAMMAD CHAUDHARY, C.J.‑‑‑This Constitutional petition has‑been filed on behalf of Sakhi Dost Jan son of Hail Qadir Bakhsh to claim following relief:‑‑
"It is, therefore, most humbly prayed that trial of petitioner before the learned Sessions Judges Noushki may kindly be declared as illegal, unlawful and of no consequence and same be quashed.
Any other relief deemed apt by this Honourable Court may also be granted to the petitioner."
Precisely stating facts giving rise to instant petition are that in the year of 1990 petitioner was involved alongwith others in following criminal cases:‑‑
S.No. F.I.R. No. with Offence charged against
brief description petitioner and others
___________________________________________________________________________________________
on the complaint of Colonel Prohibition Order, 1979
Commandant (Saleem Akhtar)
HQ Kharan Rifles.
2 F.I.R. No.Nil dated 10‑10‑1990 (i) Under section 16
on the complaint of seizing Customs Act, 1969 read
party Commander Colonel with section 2(s) read with
M. Shaukat Kharan Rifles, section 2(s) punishment
Noukundi 156(1)(8)(89) ibid.
(ii) Under section 3/4/26
of the Prohibition (Import
Control of Hadd), 1979.
(iii) Under sections 147, 148, 149, 353, 333, 307, 302 delivering public
service P.P.C. in the end
thereby committing with
attempted murder and
murder of F.C. Person.
Separate challans of both the cases were put up before the Sessions Judge and Special Judge under the Customs Act, 1969 at Quetta. Later on case pertaining to Article 3/4, Prohibition (Enforcement of Hadd) Order, 1979 read with section 8/14 of the Dangerous Drugs Act was transferred on the file of Special Court for Speedy Trial Balochistan, headed by one of us (Mr. Justice Iftikhar Muhammad Chaudhary). As petitioner and others did not plead guilty of the charge, therefore, evidence was recorded but judgment could not be announced, because of filing of Constitutional petition by the persons facing trial proceedings were restricted to the extent of not, to announce final judgment. However, in the meanwhile Constitutional provision in pursuance whereof the Speedy Courts were created lapsed, therefore. case of the petitioner was sent to Sessions Judge, Quetta.
As far as second case under the Customs Act is concerned it was finally disposed of by the Special Judge vide judgment dated 20‑11‑1994 whereby petitioner. alongwith others including absconders was acquitted of the charge.
It may be noted that learned Special Judge Customs in his judgment dilated upon the following points for decision of the case:
(1) Whether the prosecution has established a case against the accused persons under section 156(1)(8)(89) of the Customs Act beyond any reasonable doubt?
(2) Whether `the presumption can be drawn as per provisions of section 178 of the Customs Act?
(3) Whether presumption can be drawn that the accused had retained the seized goods knowing or having reasons to believe the same to be smuggled and of foreign origin?
It is to be observed that the judgment passed by the Customs Judge has not been challenged by the State in the appellate forum, Thus it has achieved finality so far it relates to his involvement in offences of the Customs Act, 1969 is concerned.
Whereas the case pertaining to offence of enforcement of Hadd Order, 1979 is concerned that has not been finally decided and reportedly is pending on the file of Session's Judge; Chaghi at Noushki, therefore, to declare the trial of the petitioner pending before said Court as illegal, unlawful etc. present petition has been filed.
M/s. Dr. Khalid Ranjha Advocate and Mr. Amanullah Kanrani, Advocate appeared on behalf of petitioner, whereas Mr. Tariq Mehmood, Advocate represented the State through Anti‑Narcotics. Force.
Learned counsel for petitioner argued that the trial of petitioner before Sessions Judge is in violation of Article 13(1) of the Constitution of Islamic Republic of Pakistan read with section 403, Cr.P.C. and Section 26 of General Clauses Act because he has been acquitted by the Special Judge under the Customs Act, 1969 on the basis of same set of evidence, therefore, he cannot be prosecuted and sentenced in presence of same evidence constituting same offence. Reliance was placed by him on PLR 1998 Lah. 239: PLD 199& Lah. 307: PLD 1998 Kar. 159: 1997 PCr.LJ 11771: PLD 1993 SC 247; PLD 1983 Lah. 71; PLD 1982 FSC 265; 1981 SCMR 1008.
Learned counsel for the State contended that Article 13(1) guarantees protection against double punishment and self‑incrimination to prohibit prosecution and punishment for the same offence snore than once, therefore. firstly as far as acquittal in a case involving distinct offence will not provide protection to the accused unless it is not shown that he has been prosecuted and punished for the same offence, To determine whether offence charged against petitioner and others falling within the definition of same offence it would be imperative to examine essential ingredients of both the laws in respect whereof he was challaned and out of which in one of the cases under section 156(1)(8)(891 of the Customs Act, 1969 he has been acquitted and is facing prosecution in the offence under Article 3/4 of the Prohibition (Enforcement of Hadd) Order, 1979. According to the learned counsel the ingredients of both the offences are distinct and different from each other. therefore, prosecution of the petitioner in the later case will not be barred and the Sessions Judge, Naushki is proceeding against him with lawful authority. Reliance was placed by him on PLD 1961 Lah. 269; PLD 1977 Kar. 144; 1985 PCr.LJ 499;1987 MLD 1948; 1988 PCr.LJ 881; PLD 1990 FSC 62; 1995 SCMR 626 and 1998 PCr.LJ 1352.
We have heard parties, counsel at length and have gone through relevant provisions of law carefully. In our opinion it would be appropriate to reproduce, hereinbelow Article 13 of the Constitution of Islamic Republic of Pakistan arid section 403, Cr.P.C.:
ARTICLE 13 OF THE CONSTITUTION:
Protection against double punishment and self‑incrimination.‑‑No person‑‑
(a) shall be prosecuted or punished for the same offence more than once; or
(b) shall, when accused ‑of an offence, be compelled to be a witness against himself.
SECTION 403. CR.P.C.:
Person once convicted or acquitted not to be tried for same offence.‑‑(1) A person who has once been tried by a Court of competent jurisdiction for an offence and convicted or acquitted of such offence and shall, while. such conviction or acquittal remains in force, not to be liable to be tried again for the same offence, nor on the same facts for any other offence for which a different charge from the one made against him might have been made under section 236, or for which he might have been convicted under section 237.
(2) A person acquitted or convicted for any offence may be afterwards tried for any distinct offence for which a separate charge might have been made against him on the former trial under section 235, subsection (1).
(3) A person convicted of any offence constituted by any act causing consequences which, together with such act, constituted a different offence from that of which he was convicted. may be afterwards tried for such last‑mentioned offence, if the consequences had not happened, or were not known to the Court to have happened, at the time when he was convicted.
(4) A person acquitted or convicted of any offence constituted by any acts may notwithstanding such acquittal or conviction, be p subsequently charged with and tried for any other offence constituted by the same acts which he may have committed if the Court by which he was first tried was not competent to try the offence with which he is subsequently charged.
(5) Nothing in this section shall affect the provisions of section 26 of the General Clauses Act, 1897 or section 188 of this Code."
A careful perusal of both the laws reproduced hereinabove make it abundantly clear that the accused cannot be tried for the same offence in respect whereof he has already been prosecuted and punished. In Article 13 word "and" is conjunctive, therefore, its plain interpretation would be that even if an accused has been acquitted he cannot claim protection of this Article on the strength of arguments that for the same circumstances and set of evidence he has been acquitted of the charge. At this juncture it is necessary to understand the meaning of the word "same offence". This expression has been defined in the case of PLD 1977 Karachi 144 Hoot Khan v. Industrial Relations Commission reproduced hereinbelow:‑‑
"The provisions of section 403, Cr.P.C. on the basis of which the above decision was given, however, are substantially different from the provisions contained in Article 13(a) of the Constitution. Subsection (1) of section 403, Cr.P.C. not only bars subsequent trial of a person who has once been tried by a Court of competent jurisdiction for an offence and convicted or acquitted for the same offence, but further bars, his trial on the same facts for any other offence for which a different charge from the one made against him might have been framed under section 236 or for which he might have been convicted under section 237. It will thus be seen that an extended meaning has been given to 'same offence' by including within its fold other offence for which, on the same facts, a charge under section 236 might have been framed or a conviction may have been recorded under section 237. The bar in the Constitution, however, is against prosecution or punishment for the same offence for which a person has been previously tried or convicted. No extended meaning of same offence, as in section 403, Cr.P.C. thus can be given to this expression as used in the Constitution. The test for the same offence is whether the former offence and the offence subsequently charged have the same ingredients in the sense that the facts constituting the one are sufficient to justify ‑the conviction of the other, not that the facts relied on by the prosecution are the same at the two trials. Furthermore, the previous prosecution must be before a Court which had jurisdiction to try both the first offence alleged as well as the offence for which the accused is being subsequently prosecuted There cannot be a valid prosecution before a Court if the Court had no jurisdiction to try the offence for which the accused is being subsequently tried."
In the above judgment honourable Judge of Karachi High Court as then he was, provided litmous test to determine where accused for the second time has been charged for the same offence or not according to which to adjudge whether cases pending against accused fall under the definition of same offence it is necessary to examine ingredients of both the offences charged against the accused. With reference to the facts constituting the crime whether facts of one of the cases are sufficient to justify conviction of the other or not. Applying this test on the instant case we feel no difficulty in concluding that the Special Judge Customs has taken into consideration three points which have been reproduced hereinabove and discussed the facts of the case with reference to the offence of smuggling which is punishable under section 156(1)(8)(89) read with section 178 of the Customs Act. As far as act of smuggling is. concerned it has been defined under section 2(s) of the Customs Act which means to bring into or take out of Pakistan in breach of any prohibition or restriction for the time being in force or evading payment of customs duties or taxes leviable thereon. Initially smuggling of the drugs was not .an offence punishable under the Customs Act, subsequently in exercise of powers under section 16 restriction on its import and export was imposed, as such by issuing an SRO drugs were included to be a banned item, therefore, if a person in contravention to these provisions imports or exports any drug into Pakistan his action shall be liable to be punishable under section 156(1)(8)(89) of the Customs Act. As far as section 178 of the Customs Act is concerned it deals with the punishment of persons accompanying a person possessing goods liable to confiscation. The ingredients of the provisions of law have to be considered in view of the evidence available on the file of the Special Judge Customs. It may be noted that learned Special Judge Customs had not. based its judgment on the evidence which was recorded by the Special Court for speedy trial and decided the case on recording of the evidence of the prosecution witnesses independently.
At this juncture it would also not be out of place to mention here that on account of non‑availability of the evidence recorded in both the cases it is not possible to know as to whether in proceedings of both the cases the same witnesses appeared and they furnished identical evidence or different evidence was given by them.
As far as Article 3 of Prohibition (Enforcement of Hadd) Order, 1979 is concerned it. places restriction on imports, exports, transports, manufacturing or process any intoxicant or bottles or sells or serves any intoxicant or allows any of the acts aforesaid upon premises owned by him or in immediate possession and on establishing the offence, accused shall be punishable with imprisonment of either description by a term which may extend to five years and with whipping not exceeding 30 stripes and shall also be liable to fine. So far Article 4 is concerned it provides punishment for owning, possessing or keeping in his custody any intoxicant with imprisonment of either description for a term which may extend to two years or with whipping not exceeding 30 stripes and shall also be liable to fine; whereas as per proviso appended therewith if the intoxicant in respect of which the offence is committed is heroin, cocane, opium or coca leaf the offender shall be punishable with imprisonment for life or with imprisonment which is not less than two years and with whipping not exceeding 30 stripes and shall also be liable to fine.
A cursory perusal/comparison of the offences falling within the mischief of Customs Act and Prohibition (Enforcement of Hadd) Order, A 1979 clearly spells out different ingredients in both of them.
In this behalf in the judgment of Jamshed Ali v. The State 1998 PCr.LJ 881, authored by honourable Mr. Justice Saiduzzaman Siddique as then he was Judge of Karachi High Court examined purpose and object of the offences falling under the Customs Act and Prohibition (Enforcement of Hadd) Order, 1979 and held that there is no conflict in both the offences. Relevant para. therefrom is reproduced hereinbelow:
"Smuggling as defined under Customs Act means, to bring in or take out of Pakistan any goods in breach of prohibition or restriction for the time being in force by any route other than that which is declared under section 9 of the Act, or evading payment of Customs duty or taxes leviable on any goods notified by the Federal Government in the official Gazette, clearance of which at a customs station is sought or affected through concealment, fraud or misdeclaration. The punishment for the above offences are prescribed under section 156 of the Act. It will thus be seen that mere possession of a narcotic substance or its transportation, sale, serving or dealing in any manner with it is not punishable under the provisions of the Customs Act. It is only when by virtue of the notification issued by the Federal Government the bringing in and taking out of Pakistan, of a narcotic or psychotropic substance is prohibited that such acts or any attempt or abatement thereof becomes punishable under the Customs Act. As compared to this, the provisions of P.O. No.4 of 1979 makes a general provision prohibiting import, export, transportation, manufacturing, processing, bottling, selling and or dealing in any manner with any kind of intoxicants and makes all such acts punishable under the law. Upon comparison of the provisions of the two statutes' there can be no doubt that the provisions contained in P.0.4 of 1979 are of general nature and are very wide in its scope and impact as compared to the provisions of Customs Act. In this respect the Customs Act, 1969 is to be treated as a special Act while P.0.4 of 1979 as a general Act. Under the provisions of Customs Act only under, special circumstances when bringing in and taking out of Pakistan of narcotics and psychotropic substance is prohibited under a notification issued by the Federal Government only then such bringing in and taking out or an attempt or abatement thereof is punishable under the Customs Act, while under P.0.4 of 1979 possession of every kind, of intoxicants, its transportation, manufacturing, processing bottling, selling and serving is made punishable. The purposes and objects of the two legislations are, therefore, quite different. The promulgation of P.0.4 of 1979 has neither altered the offence of smuggling nor its punishment. Mere fact that under the provisions of P.0.4 of 1979 the act of import and export of a narcotic could also be punished is not sufficient to hold that there is conflict between the provisions of the Customs Act and P.0.4 of 1979 and the two cannot stand together consistently. I am, therefore, of the view that there is no conflict between the provisions of the Customs Act and that of P.0.4 of 1979 and both the legislations can operate constantly in their respective fields. I accordingly hold that P.0.4 . of 1979 did not repeal any of the provisions of Customs Act. As a result of above discussion Special Criminal Revision 9 of 1986 is dismissed. In view of the decision of law point, the Special Criminal Bail No.95 of 1987 may be fixed for consideration on merits."
Similarly Full Bench of honourable Federal Shariat Court in the case of State v. Anwar Khattak and others PLD 1990 FSC 62 thoroughly examined the provisions of the Article 13 and section 26 of General Clauses Act as well as section 403, Cr.P.C. while comparing offence falling under the Customs Act and the Prohibition (Enforcement of Hadd) Order, 1979 and held that both the offences are separate and distinct. Relevant para. for the sake of guidance therefrom is also reproduced hereinbelow:‑‑
"In the light of the above discussion we are of the view that whereas the offence under section 2 read, with sections 16 and 156(8) arises on the violation of restriction or prohibition issued at the option of the Federal Government, the Articles 3 and 4 not only make 'import and export' an offence but even possession, transport, manufacture, processing and sale etc. also. Again the maximum sentence of imprisonment provided under section 156(8) is 10 years while it is imprisonment for life under Articles 3 and 4 of P.0.4 of 1979. Further appeal against a conviction under Articles 3 and 4 lies before the Federal Shariat Court whereas the High Court is the appellate authority in respect of offences under the Customs Act. Finally the Customs Court has the exclusive jurisdiction under the Customs Act whereas the Sessions Court and the Courts subordinate to it have the exclusive jurisdiction under Articles 3 and 4. There are thus two separate and distinct offences.
Thus, section 156(8) deals with all such things with regard to which there is a prohibition or restriction of bringing into‑ or taking out of Pakistan. The power to impose restriction or prohibition is given to the Federal Government in section 16 of the Customs Act. As said above the P.0.4 of 1979 makes every process or any dealing with the intoxicants an offence. Again it is one of the Hudood laws. The Customs Act on the other hand is an administrative law based on the residuary power of legislation entrusted to human beings. Admittedly, a man‑made law cannot supersede a law based on divine Hadd.
The result is that the two laws deal with different situations and create distinct offences and there is no conflict, repugnancy or resulting implied repeal. Again, the Customs Court has got exclusive jurisdiction under the Customs Act in respect of smuggling and it has not been given any power to try or decide the cases falling under other provisions of law or the P.P.C."
Although learned counsel for parties cited number of judgments on the point but in view of the above categorical declaration by a Full Bench of honourable Federal Shariat Court in our opinion no further room is left o discuss as to whether offences falling under the Customs Act or Prohibition (Enforcement of Hadd) Order, 1979 are same offences or distinct offences. However, with benefit latest judgment of honourable Supreme Court reported in 1995 SCMR 626 can be referred and for the sake of guidance its relevant paras are reproduced hereinbelow:‑‑
"It is obvious that Muhammad Ashraf appellant was arraigned twice before the Sessions Court. In the case commenced on the strength of F.I.R. lodged at the instance of Muhammad Saleem he was convicted and sentenced to death, but his other trial concluded in the pronouncement of judgment of acquittal. By reason of his dual trial, Mr. K.M.A. Samdani, Advocate has argued that the said appellant was vexed twice for one and the same offence which is violative of Constitutional guarantee provided by Article 13(a) of the Constitution and also in contravention of section 403(1) of the Criminal Procedure Code. He contended that Article 13(a) extends protection to an individual against the prosecution for the same offence and the possible conviction more than once. He submitted that double trial on the same accusation is against the Constitutional guarantee. Thus, it was urged that the trial of Muhammad Ashraf stood vitiated and his conviction and sentence were wholly illegal. and confined this submissions to the repetition of the argument that Muhammad Saleem P.W. was not present when the occurrence took place. The contention is that had he been present, he would not have survived at the hands of the assailants, who as reflected by their conduct, were bent upon doing away with all the male members of the complainant's family with whom they came across on the fateful night.
The rule that no one shall be vexed twice for the same offence has its roots in the ancient maxim "Nemo bis debet puniri pro uno delicto" which means that no one should be subjected to peril twice for the same offence. It is a fundamental rule of criminal law that no one should be exposed to hazards of punishment and convicted twice for one and the same offence. This doctrine is enshrined deeply in the legal system of the countries following Anglo‑American Jurisprudence, it is incorporated in one form or another in the statutory law, or as a Constitutional guarantee in the Constitutions of the some of the countries. The rule is ingrained in the Fifth Constitutional Amendment to the ‑American Constitution, which ordains that 'no person shall be subjected for the same offence to be twice put in jeopardy for life or limb'. In Halsbury's Laws of England (2nd Edn.), Vol. 9 pages 152, 153, para.212 it is stated as under:
'The plea of 'autrefois convict' or 'autre fois acquit' avers that the defendant has been previously convicted or acquitted on a charge for the same offence as that in respect of which he is arraigned. The question for the jury on the issue is whether the defendant has previously been in jeopardy in respect of the charge on which he is arraigned, for the rule of law is that a person must not be put in peril twice for the same offence. The test is whether the former offence and the offence, now charged have the same ingredients in the sense that the facts constituting the one are sufficient to justify a conviction of the other, not that the facts relied on by the Crown are, the same in the two trials. A plea of 'autrefois acquit' is not proved unless it is shown that the verdict of acquittal of the previous charge necessarily involves an acquittal of the latter.'
In our Constitution this rule is enacted in Article 13(a) which provides that:
'No person shall be prosecuted or punished for the same offence more than once.
It will be seen that the protection given by this Article is against prosecution and double punishment. By prosecution is meant a trial followed by judgment of acquittal of punishment. It includes the entire proceeds starting with taking cognizance of an offence by the Court, followed by examination of evidence, addressing of arguments and ending with the pronouncement of judgment. It seems to us that if as a result of prosecution for an offence the trial ends in acquittal. Article 13(a) is not attracted. Constitutional guarantee is available only if the accused is convicted and punished Thus, if the first prosecution results in acquittal, so far as this Article is concerned, the second prosecution is not prohibited. It is, however, open to the legislature to enlarge the scope of Constitutional guarantee and further extend the protection envisaged by Article 13(a). Such extension of rule of double jeopardy is to be found in section 403(1) of the Criminal Procedure Code, which is reproduced below:
'A person who has once been tried by Court of competent jurisdiction for an offence and convicted or acquitted of such offence shall, while conviction or acquittal remains in force not be liable to be tried again for the same offence, nor on the same facts for any other offence for which a different charge from the one made against him might have been made under section 236 or for which he might have been convicted under section 237.'
It is to be noticed that the Constitutional guarantee is confined only to duplicate punishment and is silent in so far as acquittal is concerned. Section 403(1) however, prohibits the second trial for an offence during the course of existence of conviction or acquittal of a person as the case may be, in consequence of final adjudication of such an offence by a Court of competent jurisdiction. Thus the rule against autrefois acquit finds place in section 403(1) and the counterpart of this rule "autrefois convict" has received recognition in the Constitutional guarantee embodied in Article 13(a).
In the light of these Constitutional and statutory provisions it needs to be examined as to whether the conviction of Muhammad Ashraf appellant and the death sentence awarded to him suffer from any illegality. As already observed that one trial ended in conviction and punishment and in the second case he was acquitted. When the two judgments arc placed in juxtaposition it becomes evident that the judgment of conviction in point of time was rendered first and shall hold the field, The appellant's subsequent acquittal cannot reflect upon his conviction and sentence awarded to him on the basis of the trial, founded on the F,I.R. lodged by Muhammad Saleem. Here a reference may also be made to section 26 of the General Clauses Act, which is reproduced below:
'Whether an act or mission constitutes an offence under two or more enactments, then the offender shall be liable to be prosecuted and punished under either or any of those enactments but shall not be liable to be punished twice for the same offence.
It will thus appear that under section 26 of the General Clauses Act there is no bar on the simultaneous prosecution; what is prohibited is duplicate punishment and not the trial. In view of the foregoing analysis of the Constitutional and statutory provisions the judgment impugned, before us is neither violative of the fundamental right nor in contravention of section 403(1), Cr.P.C.'."
It may be seen that honourable Supreme Court in the above judgment has held that a duplicate punishment is prohibited and not the trial. Thus following the guidelines provided by honourable Supreme Court we are inclined to hold that under the circumstances 'the trial of petitioner under Article 3/4 of the Prohibition (Enforcement of Hadd) Order read with section 8/14 of the Dangerous Drugs Act is not violative of the provisions of Article 13 of the Constitution of Islamic Republic of Pakistan read with statutory laws under section 403, Cr.P:C. and section 26 of the General Clauses Act.
We may point out here that learned counsel for the petitioner and for respondent has also referred number of judgments in support of their contentions, but in our humble opinion in presence of law laid down by honourable Supreme Court in the above judgments there is no scope to refer or discuss them in detail.
Mr. Amanullah Kanrani learned counsel appearing for petitioner stated that ' he has also been instructed by senior counsel to argue on his behalf that because Prohibition (Enforcement of Hadd) Order, 1979 has not been extended to tribal areas according to Article 247 of the Constitution of Islamic Republic of Pakistan, therefore, from this point of view as well the trial of petitioner under Article 3/4‑.of the Ordinance, 1979 is without lawful authority.
Mr. Tariq Mehmood learned counsel for the State argued that this question is not open to discussion because it has already been settled down in. terms of the judgment reported in PLD 1986 Peshawar 166, 1993 SCMR 1523. We have gone through both the judgments, therefore, we are inclined to agree with the learned counsel for the respondent. However, relevant para. from the judgment of State and another v. Sajjad Hussain and others 1993 SCMR 1523, is reproduced hereinbelow:
"As the P.O. No.4 of 1979 is not an Act of Majlis‑e‑Shoora but is a Constitutional Order made by the President and the Chief Martial Law Administrator and is expressly said to extend to whole of Pakistan within which is included the Federally Administered Tribal Areas, this Order No.4 of 1979 would extend to Federally Administered Tribal Areas. This is further borne out by the fact that it was taken to be so extended to the Federally Administered Tribal Areas by the Presidential Order No.5 of 1984. It was enforced on 8‑10‑1984 and was deemed to have taken effect on the 25th of June, 1980. By its Article 2 it provided as hereunder:‑‑
2: Jurisdiction of Federal Shariat Court not to extend to the Fedora lv Administered Tribal Areas.‑‑(I) The jurisdiction of the Federal Shariat Court shall not extend, and shall be deemed never to have extended to the Federally Administered Tribal Areas;
(2) Notwithstanding the judgment of any Court, including the Federal Shariat Court, all laws in force in the Federally Administered Tribal Area shall be deemed to be and always to have been, valid and shall not be called in question before any Court on any ground whatsoever. "
In view of the above conclusions by honourable Supreme Court we are not inclined to entertain the arguments put forth by learned counsel for petitioner. Thus the same is accordingly repelled.
It is next argued by learned counsel for petitioner Mr. Amanullah Kanrani that after repeal of the law under which Special Courts for speedy trial were constituted when the case was sent to Sessions Judge for trial it was incumbent upon the Presiding Officer to have held . de novo trial of petitioner in the interest of justice.
Mr. Tariq Mehmood learned counsel for the respondent stated that after remand of the case by the Special Court to the Sessions Judge, Quetta petitioner submitted an application before the learned Sessions Judge for de novo trial, but the request so made by him/them was rejected on second May, 1994 and against said order revision was filed before this Court which was dismissed on 3‑8‑1994 holding that application for de novo trial has been rightly rejected by the trial Court, thereafter petitioner filed a petition for special leave to appeal before honourable Supreme Court of Pakistan and these appeals were decided on 10‑6‑1998 whereby it was observed by honourable Supreme Court that the proper remedy for the applicant was to approach the Federal Shariat Court consequently petition was filed before Federal Shariat Court which has been dismissed on 2‑7‑1999. This very point is under consideration before the Supreme Appellate Court as the petitioner has filed a petition against the order of Federal Shariat Court. Thus he suggested that under the circumstances it would not be proper for this Court to attend this question which is the subject‑matter of petition before honourable Supreme Court. We are quite in agreement with the learned counsel, therefore, we are not inclined to dilate upon this aspect of the case because matter is sub judice before a superior Court.
No other point was argued
Thus for the foregoing reasons we see no force in the petition, as such the same is dismissed in limine..
Q.M.H./M.A.K./15/Q Petition dismissed
P L D 2000 Quetta 40
Before Fazal‑ur‑Rehman, J
MUHAMMAD USMAN‑‑‑Petitioner
versus
MUHAMMAD SHOAIB and another‑‑‑Respondents.
Civil Revision No.270 of 1998, decided on 29th September, 1999.
Civil Procedure Code (V of 1908)‑‑‑
‑‑‑‑S. 115‑‑‑Contempt of Court Act (LXIV of 1976), Ss.3 & 4‑‑‑Contempt of Court proceedings‑‑‑Concurrent findings of fact‑‑‑Both the Courts below concurrently dismissed the proceedings initiated against the respondents‑‑Interference in revision‑‑‑Petitioner agitated the same grounds which were argued before the Lower Appellate Court‑‑‑Concurrent findings of facts arrived at by Courts below could not be interfered with by High Court in exercise of revisional jurisdiction as in revision finding of fact could not be looked into except in case of glaring illegality‑‑‑Neither any legal flaw, nor any illegality was pointed out in the orders of both the Courts below‑‑Revision was dismissed in circumstances.
Anwar‑ul‑Haq for Petitioner.
Ayaz Sawati for Respondents.
Date of hearing: 9th September, 1999.
JUDGMENT
This Revision petition under section 115, C.P.C. is directed against the order, dated 12‑6‑1998 of the learned Additional District Judge V, Quetta by which he dismissed the appeal against the order, dated 8‑1‑1998 passed by the learned Senior Civil Judge, Quetta, whereby the application which was filed by the petitioner under section 3/4 of Contempt of Court Act, 1976 was dismissed.
Thereafter, an appeal under section 104 of C.P.C. was filed against the said order by the petitioner. The learned Additional District Judge‑IV; Quetta after hearing learned counsel for the parties and examination of the record dismissed the appeal and did not find any fault with the impugned order and upheld the same. This order is the subject‑matter of present revision' petition.
4. Admittedly in revision only the legal points are to be discussed and not the factual aspect. The factual side is already decided by the trial Court as well as by the Appellate Court and there are concurrent findings by both the Courts below and had not proposed to initiate contempt of Court proceedings against Tehsildar, Quetta under the provisions of Contempt of Court Act, 1976. The grounds agitated before this Court are almost the same which were argued before the Appellate Court. No legal flaw has been pointed out by the learned counsel for the petitioner. He has also failed to point out any illegality in the orders of the Courts below. The concurrent findings of facts arrived at by Courts below cannot be interfered with by this Court in exercise of revisional jurisdiction as in revision finding of the fact cannot be looked into except glaring illegality, if any, which has not been pointed out in the instant case. It has also been pointed out by the learned counsel for the respondent that the execution application was disposed of by the learned Senior Civil Judge on 15‑2‑1997. The order reads as under:‑‑
There is also mention of the said order in the order of dismissal of the application by the learned Senior Civil Judge, Quetta on 8‑1‑1998. The learned counsel for the petitioner has not been able to point out any infirmity or illegality for reversing the concurrent findings of Courts below.
Q.M.H./M.A.K./3/Q Revision dismissed.
P L D 2000 Quetta 42
Before Fazal‑ur‑Rehman, J
MUHAMMAD QASIM and 3 others‑‑‑Petitioners
versus
ABDUL QADIR‑‑‑Respondent
Civil Revision No.366 of 1999, decided on 15th November, 1999.
(a) Limitation Act (IX of 1908)‑‑‑
‑‑‑‑S. 28 & Art,.144‑‑‑Civil Procedure Code (V of 1908), S.115‑‑‑Adverse possession‑‑‑Concurrent findings of fact by both the Courts below‑‑Petitioner raised plea of adverse possession in the declaratory suit‑‑‑Both the Courts below concurrently dismissed the suit of the petitioners‑‑Validity‑‑‑Where both the Courts below analysed the evidence on record in its true perspective, no case, could be made out merely on the basis of surmises or conjectures‑‑‑Doctrine of adverse possession being repugnant to the Injunctions of Islam, provisions of S.28 & Art. 144 of Limitation Act, 1908, had been omitted ‑‑‑Petitioners failed to point out any irregularity or illegality warranting interference in the matter in exercise of revisional jurisdiction‑‑‑Conclusion arrived at by both the Courts below was not contrary to law‑‑‑Revision being without force was dismissed accordingly:
(b) Civil Procedure Code (V of 1908)‑‑‑
‑‑‑‑S. 115‑‑‑Revision‑‑‑Concurrent findings of facts by both the Courts below‑‑‑Exercise of jurisdiction by High court‑‑‑Scope‑‑‑High Court cannot substitute the conclusions drawn concurrently and reasonably by both the Courts below by proper appreciation of evidence‑‑‑Where no error of law has been committed in coming to a finding of fact, the High Court cannot substitute such a finding merely because a different finding could be given.
M. Riaz Ahmed for Petitioners
Muhammad Hashim Khan Kakar for Respondent
Date of hearing: 22nd October, 1999
P L D 2000 Quetta 46
Before Mir Muhammad Nawaz Marri and Fazal‑ur‑Rehman. JJ
FIDA HUSSAIN‑‑‑Petitioner
versus
Mst. NAJMA and another‑ Respondents
Constitutional Petitions Nos. 509 and 512 of 1998, decided on 21st October, 1999. .
(a) West Pakistan Family Courts Act (XXXV of 1964)‑‑‑
‑‑‑S. 5 & Sched.‑‑‑Constitution of Pakistan (1973), Art. 199‑‑‑Constitutional petition‑‑‑Suit for maintenance for period of 'Iddat' and suit for restitution of conjugal rights‑‑‑Former suit was filed by respondent while the latter was filed by the petitioner‑‑‑Judgments of both the Courts below were at variance‑‑‑Trial Court dismissed the suit filed by the respondent and decreed that of the petitioner, whereas the Lower Appellate Court reversed the decision arrived at by the Trial Court‑‑‑Validity‑‑‑View expressed by the Appellate Court should ordinarily be preferred in the event of conflict of judgment, unless the same was contrary .to the evidence on record or was in violation of the settled principles of administration of justice‑‑‑Findings of fact recorded by the Lower Appellate Court in the case were not perverse, arbitrary or capricious‑‑‑View taken by Lower Appellate Court was supported by evidence while the Trial Court had neither discussed the evidence nor the provisions of O. XX, R.5, C.P.C. had been complied with‑‑‑Where the conclusion arrived at by the Lower Appellate Court was not contrary to law the same was not interfered with by the High Court in exercise: of discretionary jurisdiction under Art.199 of the Constitution .
(b) Constitution of Pakistan (1973)‑‑‑
‑‑‑ Art. 2A‑‑‑Entorcement of Shariah Act (3t of 1991), S.4‑‑‑Injunctions of Islam‑‑‑General and common law of land‑‑‑Comparison‑‑‑Islamic Injunctions are not in any way subservient to the general and common law of the land‑‑Article 2A of the Constitution read with Objectives 'Resolution and S.4 of Enforcement of Shariah Act, 1991, have always kept the Islamic Laws at a higher level than other general laws of the country.
(c) Muslim Family Laws Ordinance (VIII of 1961)‑‑‑
‑‑‑‑S. 7‑‑‑Oral Talaq‑‑‑Validity‑‑‑In spite of non‑compliance of mandatory requirement of S.7, Muslim Family Laws Ordinance, 1961 even the oral Talaq is effective and binding on the parties.
1992 SCMR 1273; Mirza Qamar Raza v. Mst. Tahira Begum and others PLD 1988 Kar. 169 and PLD 1988 FSC 42 ref.
(d) West Pakistan Family Courts Act (XXXV of 1964)‑‑‑
‑‑‑‑S. 14‑‑‑Dastoor‑ul‑Amal Dewani, Riasat Kalat, S.4‑‑‑Constitution of Pakistan (1973), Art. 199‑‑‑Constitutional petition ‑‑‑Appeal‑‑‑Jurisdiction‑‑Contention by petitioner was that against the judgment and decree passed by Qazi, appeal was only competent before "Majlis‑e‑Shoora" and not before the District Judge‑‑‑Validity‑‑‑District Judge under S.14, West Pakistan Family Courts Act, 1964 was competent to hear an appeal against the judgment and decree of a Qazi appointed under S.4 of Dastoor‑ul‑Amal Dewani, Riasat Kalat.
Muhammad Riaz Ahmad for Petitioner.
Salahuddin Mengal for Respondents.
Date of hearing: 5th October, 1999.
P L D 2000 Quetta 52
Before Iftikhar Muhammad Chaudhary, CJ
Sheikh HASSAN KHAN and others‑‑‑Appellants
Versus
SHAHZADA and others‑‑‑Respondents
First Appeals from Orders Nos. 32, 37 to 42 and 33 to 36 of 1999, decided on 6th October, 1999.
(a) West Pakistan Urban Rent Restriction Ordinance (VI of 1959)‑‑‑
‑‑‑‑S. 13‑‑‑Bona fide personal need of landlord‑‑‑Landlord, who was jobless, intended to run business of timber on the plot of the rented premises after demolishing of building existing thereon‑‑‑Evidence led by landlord was confidence inspiring and in unequivocal terms stated that the premises in question was required for such business and he had made arrangement of Rs.20/25 lacs for that business‑‑‑Tenants could not rebut the particular stand of the landlord either during cross‑examination or by producing evidence‑‑Effect‑‑‑Conclusion of Rent Controller in ‑non‑suiting the landlord was devoid of force as the landlord had successfully proved his bona fides in occupying the building for such purpose‑‑‑Order of Rent Controller was set aside and tenants were liable to be ejected from the premises in circumstances.
(b) West Pakistan Urban Rent Restriction Ordinance (VI of 1959)‑‑‑
‑‑‑‑Ss. 13 & 15‑‑‑Appeal‑‑‑Ejectment proceedings‑‑‑Plea raised for the first time in appeal‑‑‑Contention raised by the tenant was that the premises was a building and the same could be used for the purpose of reconstruction and could not be used as open plot‑‑‑Validity‑‑‑Where any such plea was not incorporated in the written statement by the tenants then the landlord had not availed opportunity to rebut that plea before the Rent Controller‑‑‑Such plea was raised for the first time in defending the appeal, therefore‑, the same was not entertainable at appeal stage.
(c) West Pakistan Urban Rent Restriction Ordinance (VI of 1959)‑‑‑
‑‑‑‑S. 13(6)‑‑‑Ejectment of tenant‑.‑‑Striking off defence‑‑‑Failure to provide details in respect of default in payment of rent‑‑‑Effect‑‑‑Where landlord failed to provide such details, application for striking off defence of the tenant was dismissed.
Kamran Murtaza for Appellants
Tariq Mehmood for Respondents
Date of hearing: 17th September, 1999
P L D 2000 Quetta 61
Before Fatal‑ur‑Rehman, J
SAHIB SULTAN and 2 others‑‑‑Petitioners
versus
Moula MUHAMMAD RAMZAN‑‑‑Respondent
Civil Revision No. 380 of 1998, decided on 30th December, 1999.
(a) Civil Procedure Code (V of 1908)‑‑‑
‑‑‑‑0. VII, R.11‑‑‑Rejection of plaint‑‑‑Scope‑‑‑No cause of action‑‑Connotation‑‑‑Scope‑‑‑For the purpose of determination whether plaint discloses a cause of action or not, Court has to presume that every allegation made in the plaint is true, therefore, power to reject the plaint under O. VII, R.11, C.P.C. must be exercised only if the Court comes to the conclusion that even if all the allegations are proved the plaintiff would not be entitled to any relief whatsoever‑‑‑Rejection of plaint should be by a speaking order and not by a cryptic order.
(b) Limitation Act (IX of 1908)‑‑‑
‑‑‑‑Art. 142‑‑‑Dispossession from immovable property‑‑‑Period of limitation, computation of‑‑‑Period of 12 years is to be computed from the date of dispossession or discontinuance of possession.
1995 SCMR 522 and Maqbool Ahmed v. Government of Pakistan 1991 SCMR 2063 ref.
(c) Limitation Act (IX of 1908)‑‑‑
‑‑‑‑S. 28‑‑‑Adverse possession‑‑‑Validity‑‑‑Provision of S.28, Limitation Act, 1908 is repugnant to the Injunctions of Islam in so far as same has provided for extinguishments of right in property at determination of period prescribed for instituting a suit for possession' of property, on the basis of adverse possession.
Maqbool Ahmed v. Government of Pakistan 1991 SCMR 2063 rel.
(d) Specific Relief Act (I of 1877)‑‑‑
‑‑‑‑S. 8‑‑‑Civil Procedure Code (V of 1908), O. VII, R.1 f‑ ‑Limitation Act (IX of 1908), S.28 & Art‑144 [as amended by Limitation (Amendment) Act (11 of 1995)]‑‑‑Suit for possession of immovable property‑‑‑Plea of adverse possession raised by defendant‑‑‑Trial Court decreed the suit but Lower Appellate Court allowed the appeal and dismissed the suit ‑‑‑Validity‑‑Provision of S.28 and Art.144, Limitation Act, 1908, having since been omitted by Limitation (Amendment) Act, 1995, Lower Appellate Court was not justified by observing that the suit was barred by time‑‑‑Judgment and decree passed by Lower Appellate Court were set aside and case was remanded.
Ayaz Sawati for Petitioners.
Syed Ayaz Zahoor for Respondent.
Date of hearing: 15th November, 1999.
P L D 2000 Quetta 66
Before Fazal‑ur‑Rehman, J
Malik MUHAMMAD KHAN‑‑‑Petitioner
versus
I
NASIBULLAH and 2 others‑‑‑Respondents
Civil Revision No.29 of 1999, decided on 30th December, 1999.
(a) Civil Procedure Code (V of 1908)‑‑‑
‑‑‑‑S. 115‑‑‑Revision‑‑‑Scope‑‑‑Only legal points are to be discussed in revision and not the factual aspects.
(b) Civil Procedure Code (V of 1908)‑‑
‑‑‑‑S. 115‑‑‑Revisional jurisdiction‑‑‑Scope‑‑‑Erroneous conclusion of law or fact, correction of‑t‑Such conclusion can be corrected in appeal but the same cannot be granted in revision‑‑‑Interference by the higher Courts in revision is to correct error of jurisdiction or non‑compliance of any statutory provision of law ‑‑‑Revisional Court, therefore, is not bound to interfere with 'the merits of the case.
PLD 1999 Pesh. 57 ref.
(c) Specific Relief Act (I of 1877)‑‑
‑‑‑‑S. 56‑‑‑Injunction, when refused‑‑‑Scope‑‑‑No injunction can be issued against 'Government or to interfere with public duties of any department or to stay proceedings in any, criminal matter‑‑‑Where equally efficacious relief can be obtained by any other usual mode of proceedings, no injunction can be granted.
(d) Specific Relief Act (I of 1877)‑‑
‑‑‑‑S.42‑‑‑Civil Procedure Code (V of 1908), S.115‑‑‑Suit for declaration‑‑Concurrent finding of fact by both the Courts. below‑‑‑Dispute as to ownership of suit property‑‑‑Both the Courts below after evaluating evidence on record arrived at concurrent findings of fact and suit of the plaintiff was dismissed‑‑‑Validity‑‑‑Concurrent findings of facts arrived at by Courts below could not be interfered in exercise of revisional jurisdiction as in revision finding of fact could not be looked into except in case of glaring illegality if any‑‑‑Where neither any such illegality had been pointed out, nor , approach of the Courts below was perverse to evidence on record, judgments and decrees of both the Courts below were not interfered.
1997 CLC 875 and 1997 SCMR 1139 ref.
1994 CLC 2208 distinguished.
Naeem Akhtar for Petitioner.
Jehanzab Jadoon for Respondents.
Date of hearing: 16th November, 1999.
P L D 2000 Quetta 72
Before Javed Iqbal, C. J. and Fazal‑ur‑Rehman, J
NOORULLAH and 2 others‑‑‑Applicants
Versus
THE STATE‑‑‑Respondent
Criminal Bail Application No.51 of 2000, decided on 23rd February, 2000.
(a) Criminal Procedure Code (V of 1898)‑‑‑
‑‑‑‑S. 497(2)‑‑‑Penal Code (XLV of 1860), S.324/337ADF/449/452/504/427/506/489/511/147/148/109/34‑‑‑Bail‑‑‑Presentation of the complaint to the Political Agent and incorporating the same in the F.I.R., delayed statements of witnesses, submission of challan after about 1‑1/2 years and commencement of the trial after about one year and ten months needed further probe‑‑‑Ascertainment of the commission of any scheduled offence was yet to 'be made‑‑‑Mere accusation of non‑bailable offence was not sufficient to disentitle the accused to bail and suspicion, howsoever, strong, could not take the place of reasonable ground for believing the accused guilty or non‑guilty ‑‑‑Abscondence alone also did not come in the way of accused for grant of bail particularly when proceedings regarding their abscondence had not been taken as required under the law‑‑‑Case against accused, under the circumstances, had come within the ambit of further inquiry‑‑‑Accused were allowed bail accordingly.
(b) Criminal Procedure Code (V of 1898)‑‑‑
‑‑‑‑S. 497‑‑‑Bail‑‑‑Abscondence of accused‑‑‑Effect‑‑‑Bail cannot be refused to an accused due to his abscondence if he has no knowledge about the case pending against him in any Court‑‑‑Where the case of accused falls within the ambit of further inquiry or otherwise he is entitled to bail on merits, bail becomes his right despite his abscondence‑‑‑Abscondence also does not disentitle accused to bail if the Investigating Agency purposely does not arrest him‑‑‑Failure of Investigating Agency to perform its duty cannot be used against the accused.
Syed Ayaz Zahoor for Applicants.
Noor Muhammad Achakzai, Addl. A.‑G. for the State.
Date of hearing: 8th February, 2000.
P L D 2000 Quetta 76
Before Javed Iqbal and Fazal‑ur‑Rehman, JJ
ABDUL FATEH‑‑‑Appellant
versus
ALI AHMED and another‑‑‑Respondents
Criminal Acquittal Appeal No.265 of 1999, decided on 21st December, 1999.
Penal Code (XLV of 1860)‑‑
‑‑‑‑Ss. 324 & 337‑A(iii)(i)‑‑‑Criminal Procedure Code .(V of 1898), S.417(2‑A)‑‑‑Appeal against acquittal of accused under S.324, P.P.C.‑‑Appreciation of evidence‑‑‑Trial Court had acquitted the accused under S.324, P.P.C. and instead had convicted him under 5.337‑A(iii)(i), P.P.C. and sentenced him to imprisonment for the period he had remained in custody and to pay Arsh amounting to Rs.10,000 to the injured person‑‑Accused now was equipped with double presumption of innocence‑‑Impugned order acquitting accused under 5.324, P.P.C. had strengthened the initial presumption of his innocence‑‑‑No evidence which could bring the case within the ambit of S.324, P.P.C. was available on the record‑‑Judgment of Trial Court being not perverse, could not be interfered with by High Court regarding acquittal of accused of the charge under S.324, P.P.C. and the same was upheld accordingly.
Akhtar Zaman for Appellant.
Noor Muhammad Achakzai, Addl. A.‑G. for Respondents.
Date of hearing: 22nd November, 1999.
JUDGMENT
FAZAL‑UR‑REHMAN, J.‑‑This appeal under section 417(2)A, Cr.P.C. by Abdul Fateh is directed against the judgment of learned Sessions Judge (Ad hoc), Quetta ‑dated 31‑8‑1999 whereby, he acquitted the respondent Ali Ahmed from the charge of section 324, P.P.C. and convicted him under section 337‑A(iii), P.P.C.
Briefly stated the facts of the case are that on 11‑11‑1998 one Muhammad Arif lodged a report with Police‑Station Dalbandin alleging therein that at about 7‑30 p.m. when he was going to his house alongwith his friends he saw a person lying in injured condition who disclosed to him that he had been injured by some unknown person by means of fire‑arm. During the course, of investigation respondent was arrested. It is stated that the respondent was identified in identification prade. After usual investigation the accused was sent up to face his trial under section 324 of the Qisas and Diyat Ordinance read with section 34 while the names of acquitted accused Ghulam Sakhi and absconding accused Nazir Ahmed, were placed in column 2 of the challan.
On 28‑4‑1999 charge under section 324/34, P.P.C. was framed ,against the respondent and acquitted accused Ghulam Sakhi to which they pleaded not guilty and claimed trial.
In support of its case the prosecution examined 9 witnesses. During trial the case was transferred to learned Sessions Judge, ad hoc, Quetta. The accused/respondent denied the allegations against him and pleaded his innocence. He has also made his statement on oath. He has, however, produced no witness.
After examining the evidence on record the learned Trial Judge came to the conclusion that the prosecution has riot established a case under section 324, P.P.C. but a case under section 337‑A(iii)(i) Shajja Hashimah and sentenced him for a period he remained in custody and Arsh amounting to Rs.10,000 to be paid to the injured.
We have heard Mr. Akhtar Zaman, Advocate learned counsel for the appellant and Mr. Noor Muhammad Achakzai, learned Additional Advocate‑General for State and Ali Ahmed, Respondent in person. We have also perused the record.
The respondent Ali Ahmed after his conviction from the trial Court did not file any appeal challenging his conviction under section 337‑A(iii)(i) Shajja Hashimah, therefore, the conviction has attained finality:
As far section 324, P.P.C. is concerned which has not been established against the respondent, he is now equipped with double presumption of innocence. The order of acquittal strengthens the initial presumption of innocence of the accused persona therefore, it can only be interfered by the Court of appeal if it perverse to evidence. Learned Counsel for the appellant has not been able to indicate any evidence which can bring the case within the ambit of section 324, P.P.C. which position has even not been controverted by the learned counsel for the appellant. Keeping in view the circumstances of the case and the law as laid down while appraising evidence in appeal against acquittal, we decline to interfere with the judgment of the trial Court regarding acquittal of the accused of the charge under section 324, P.P.C.
According to section 337‑X the Arsh may be made payable in a lump sum or in instalments spread over a period of three years from the date of the final judgment. The respondent may be released on bail if he furnishes security equal to the amount of Arsh to the satisfaction of the trial Court and payment of the said amount in 20 monthly instalments. Consequently, this appeal is dismissed.
N.H.Q./18/Q Appeal dismissed.
P L D 2000 Quetta 79
Before Iftikhar Muhammad Chaudhary, C.J. and Aman Ullah Khan Yasinzai, J
GUL MIR and others‑‑‑Appellants
versus
THE STATE and others‑‑‑Respondents
Criminal Appeal No.71 and Constitutional Petition No.345 of 1999, decided on 9th December, 1999.
(a) Penal Code (XLV of 1860)‑‑‑
‑‑‑‑Ss. 302/ 149 & 148‑‑‑Appreciation of evidence‑‑‑Interested witnesses‑‑Corroboration‑‑‑Requirement‑‑‑Rule of prudence‑‑‑Requirement of independent corroboration of an interested witness is based only on the rule of prudence which is not to be applied strictly in each and every case‑‑Testimony of the interested witnesses can be relied upon without independent corroboration if the same inspires confidence.
(b) Penal Code (XLV of 1860)‑‑‑
‑‑‑‑Ss. 302/149 & 148‑‑‑Appreciation of evidence‑‑‑Presence of eyewitnesses at the scene of occurrence was established on record‑‑‑F. I: R. had been lodged promptly eliminating any chance of deliberations ‑‑‑Eyewitnesses had given a natural account of the incident corroborating each other in material aspects of the case and the intrinsic value of their testimony was not shaken in cross‑examination‑‑‑Confidence inspiring ocular evidence could not be discarded merely because the eye‑witnesses were related to the deceased and were interested witnesses‑‑‑Accused had failed to show that the said witnesses had a strong motive to falsely implicate them in the commission of. the offence‑‑‑Eye‑witness account of occurrence was also corroborated by the report of the‑ Ballistic Expert whereby the crime empties secured from the spot were found to have matched with the kalashnikovs recovered from the accused‑‑‑Statements of witnesses which otherwise appeared to be confidence inspiring could not be discarded merely for minor variations‑‑‑Motive for the occurrence having not been proved, Trial Court had rightly taken a lenient view in the matter of sentence‑‑‑Convictions and sentences of accused were upheld in circumstances‑‑‑Sentence of fine was, however, set aside and the benefit of S. 382‑B, Cr.P.C. withheld by Trial Court without ‑ giving any reason was extended to accused.
Niaz v. The State PLD 1960 SC 387; Nazir Ahmed and others v. The State PLD 1962 SC 269; Shaman v. The State PLD 1995 SC 46 and Roshan and 4 others v. The State PLD 1977 SC 557 ref.
(c) Penal Code (XLV of 1860)‑‑‑
‑‑‑‑Ss. 302/149 & 148‑‑‑Appreciation of evidence‑‑‑Minor contradictions in evidence‑‑‑Effect‑‑‑Minor contradictions in the statements of witnesses are natural with the passage of time which cannot materially affect the prosecution case, if the same do not destroy the intrinsic value of the evidence.
Shaman v. The State PLD 1995 SC 46 and Roshan and 4 others v. The State PLD 1977 SC 557 ref.
(d) Criminal trial‑‑‑
‑‑‑‑Motive‑‑‑Prosecution is not bound to prove the motive, but once a motive is set up then it is bound to prove the same.
Muhammad Aslam Chishti and Aman Ullah Kanrani for Appellants (in Criminal Appeal No.71 of 1999).
Nasarullah Khan Achakzai for the State (in Criminal Appeal No..71 of 1999).
Malik Mumtaz Hussain Mehfooz for the Complainant (in Criminal Appeal No.71 of 1999).
Malik Mumtaz Hussain Mehfooz for Petitioners (in C.P. No.345 of 1999).
Muhammad Aslam Chishti for Respondents ' (in C.P. No.345 of 1999).
Nasrullah Khan Achakzai (in C.P. No.345 of 1999).
Date of hearing: 2nd November, 1999.
JUDGMENT
AMAN ULLAH KHAN YASINZAI, J.‑‑Appellants Gul Mir son of Ghulam Muhammad Mehmood son of Gurooh, Haji Gaboo son of Zaroo, Rana son of Ramzan, Karman son of Tullan, Wali Dad son of Tullan, Khadim Hussain son of Gul Mir and Ghulam Rasool son of Muhammad Usman were tried under section 302/324/147/148/149, P.P.C. by Special Judge, S.T.A., Jaffarabad at Dera Allah Yar for the murders of Arbab Ali and Haji Muhammad Rahim and causing injury to Abdul Shakoor. All of them were convicted to suffer R.I. for 20 years under section 302, P.P.C. and under section 324, P.P.C. to suffer R.I. for 7 years and under section 148, P.P.C. to suffer R.I. for 3 years with a fine of Rs.50,000 each to be paid as compensation to the legal heirs of the deceased persons and Rs.5,000 each to be paid to injured Abdul Shakoor vide judgment dated 24‑3‑1999, all these sentences were ordered to run concurrently. The appellants have assailed the impugned judgment through Appeal No.71 of 1999 against their conviction. The complainant Ghulam Ali and widow of deceased Arbab Ali have filed Constitutional Petition No.345 of 1999, for the enhancement of the sentence of the appellants. Both the matters shall be disposed of by this judgment.
Briefly stating the facts of the case are that on 8‑11‑1997 on the basis of Fard‑e‑Bayan Exh.P/2‑A of P.W.2 Ghulam Ali, report was lodged with Sanhari Police Station under section 147/148/149/303/324, P.P.C. alleging therein that the complainant is resident of Goth Haji Muhammad Salah Gajani and is landlord of the said area. It is further averred that on the day of incident, he (Ghulam Ali) alongwith Arbab Ali, Haji Muhammad Rahim, Abdul Shakkoor and Rahim Dad were harvesting the Paddy Crop and were loading the same in bullock cart. At about 3‑00 p.m., the accused persons namely Abdul Karim alias Adok, Rehmatullah alias Khan, Nisarullah all sons of Muhammad Bakhsh, Amanullah, Abdul Hameed, both sons of Sabbir Ahmad, Shehbaz son of Abdul Majeed Garrah, Karamullah sons of Mushtaq Ahmad, Fazal Rehman son of Nazeer Ahmad, Nango son of Raz Muhammad, Dad Muhammad son of Yara, Khadim son of Gul Mir son of Ghulam Muhammad, Sachchal alias Sachcho and Ghulam Rasool sons of Muhammad Usman and five other unknown persons came and surrounded them. Thereafter, they started indiscriminate firing at them with kalashnikov due to which Arbab Ali and kaji Muhammad Rahim died on the spot and Abdul Shakoor received bullet injuries on his left leg. It is further stated that complainant alongwith Rahim Dad took shelter in the watercourse. The accused persons after firing at them, decamped from the place of incident. The motive for the said incident is stated to be old enmity.
On the basis of Fard‑e‑Bayan F.I.R. Exh.P/11‑A was lodged with Police Station Sanhari, District Jaffarabad. After receiving report, P.W.11 Ubaidullah, S.I., proceeded to the place of incident and prepared site sketch Exh.P/11 and .prepared site inspection report Exh.P/5‑A, took into possession 120 empties of kalashnikov vide memo. Exh.P/11‑C, secured blood‑stained earth of deceased Arbab Ali vide memo. Exh.P/5‑B and bloodstained earth of deceased Muhammad Rahim vide Exh.P/5‑C and also prepared parcel of the 120 empties secured from the place of incident. Inquest report of deceased Arbab and Muhammad Rahim was prepared vide Exh.P/11‑D and Exh.P/11‑E, respectively.
On the next day i.e. 9‑11‑1997, investigation of the case was handed over to P.W.10 Noor Hussain who arrested accused Gul Mir, Rana, Kirman, Wall Dad, Haji Gabboo and Mehmood. He recovered kalashnikov alongwith 17 live cartridges from Gul Mir end took the said kalashnikov into possession vide Exh.P/6‑A. A kalashnikov was also recovered from possession of accused Mehmood which was taken into possession vide memo .Exh.P/7‑A. The blood‑stained clothes of deceased Arbab and Mehmood were taken into possession vide memo. Exh.P/4‑A and Exh.P/4‑B respectively. Medical reports of deceased Muhammad Rahim and Arbab were collected from the hospital being Exh.P/1‑A, Exh.P/1‑B. He carried out identification parade of accused mentioned above vide Exh.P/8‑A and submitted incomplete challan against them vide Exh.P/10‑A. On 3‑12‑1997, accused Khadim Ali was also arrested and incomplete challan Exh.P/10‑B was also submitted by him. .On 20‑1‑1998, accused Ghulam Rasool was arrested. After investigation, incomplete challan Exh.P/10‑C was also submitted. He collected report of chemical expert being Exh.P/10‑D and submitted the same vide challan Exh.P/10‑E. Report of the ballistic expert Exh.P/10‑F was also obtained and medical report Exh.P/10‑G of injured Abdul Shakoor was also collected from the hospital and complete challan Exh.P/10‑A was, submitted.
4‑A. After completion of investigation, challan against those accused persons who were arrested, mentioned above, in para. l was submitted before Special Judge, S.T.A. However, the remaining accused persons were declared absconders. Charge against these accused persons was framed on 2‑4‑1998 which was denied. To substantiate its case, the prosecution produced the following witnesses:
P.W.1 Dr.Taj Muhammad, Medical Officer Dera Allah Yar examined the deceased persons. On the person of deceased Arbab Ali he observed the following injuries:‑‑
"(1) Entrance fire‑arm wound on the front of chest left side 1/2 inches x 1/2 inches.
(2) Exit fire arm wound on the back of the chest, left scapular region.
OPINION. Cause of death was due to excessive haemorrhage and shock."
He issued medical certificate Exh.P/1‑A in respect of deceased Arbab Ali. He also examined deceased Haji Muhammad Rahim and observed the following injuries:‑
"(1) Entrance of fire‑arm wound on the front of the chest, right side 1 /2 inches x 1/2 inches.
(2) Exit of fire‑arm on the back of the chest right side.
OPINION. Cause of death was due to excessive haemorrhage and shock."
He issued certificate Exh.P/1‑B, 5. P. W.2 Ghulam Ali is the complainant and eye‑witness of the incident. He stated that on 8‑11‑1997, he alongwith Arbab Ali, Haji Muhammad Raheem, ‑Abdul Shakoor and Rahim Dad were working in the Paddy field while accused persons namely Rehmatullah, Sanaullah, Amanullah, Abdul Karim, Abdul Hameed, Shehbaz Garrah Khan, Karamullah, Nago Dad Muhammad alias Dado, Gul Mir, Khadim Ali, Ghulam Rasool Machal and five other unknown persons came there and started indiscriminate firing upon them with kalashnikovs. Arbab Ali and Haji Muhammad Rahim died on the spot. Abdul Shakkoor received bullet injuries on his left leg. Thereafter, the accused persons ran away. Police came to the spot and recorded his Fard‑e‑Bayan Exh.P/2‑A. During this period, accused Haji Gabbu, Mehmood, Rana, Karman and Wali Dad were arrested and he identified them during identification parade.
P.W.3 Abdul Shakoor and P.W.5 Rahim Dad reiterated the same facts as narrated by P.W.2 Ghulam Ali. P.W.5 is also witness to the site inspection note Exh.P/5‑A and marginal witness to blood‑stained earth of the deceased persons vide memos. Exh.P/5‑B and Exh.P/5‑C.
P.W.4 Muhammad Fazil Head‑Constable is marginal witness to the recovery of blood‑stained clothes of the deceased persons vide Exh.P/4‑A and Exh.P/4‑B.
P.W.6 Khalid Mehmood Head‑Constable is marginal witness to the recovery of blood‑stained clothes of the deceased person vide Exh.P/4‑A and Exh.P/4‑B.
P.W.6 Khalid Mehmood Head‑Constable is Masheer to the recovery of kalashnikov recovered from the possession of appellant Gul Mir alongwith seven live cartridges which were taken into possession vide Exh.P/6‑A.
P.W.7 Binyamin is Masheer to the recovery of kalashnikov recovered from the possession of appellant Mehmood which was taken into possession vide Exh.P/7‑A alongwith 27 live cartridges from his possession and 30 live cartridges loaded in the magazine of the kalashnikov, at the time of the recovery.
P.W.8 Manzoor Ahmad is Naib‑Tehsildar. In his presence identification parade of accused Haji Gabbu, Mehmood, Wali Dad, Rana and 'Karman was held. He prepared identification parade memo. Exh.P/8‑A.
P.W.9 Abdul Jabbar is also marginal witness to the recovery of kalashnikov from Mehmood. P.W.10 Noor Hussain S.‑I. and P.W.11 Ubaidullah, S.I. conducted investigation of the cases as mentioned above.
The appellants were examined under section 342, Cr.P.C. However, they did not record their statements on oath under section 340(2), Cr.P.C. nor led any evidence in their defence. After assessing the evidence on record, the learned Sessions Judge/Special Judge S.T.A., Jaffarabad convicted the appellants in the terms mentioned hereinabove.
During pendency of the. appeal, appellants Mehmood, son of Gurroh, Haji Gabboo son of Zarroo, Rana son of Ramzan, Karman son of Tullan and Wali Dad son of Tullan entered into compromise with the legal heirs of the deceased Akbar Ali and Haji Muhammad Rahim. Legal heirs of the deceased persons appeared before the Court and confirmed the contents of the compromise entered into between them and the accused. Thus, in view of the compromise, the afore‑mentioned accused persons were acquitted of the charge under sections 302(c) and 342, P.P.C. vide Order dated 26‑8‑1999. However, it was ordered that case under section 148, P.P.C. shall be disposed of against them independently as the same was not compoundable. This judgment shall dispose of the case of the remaining accused namely Gul Mir S/o Ghulam Muhammad, Khadim Ali S/o Gul Mir and Ghulam Rasool S/o Muhammad Usman under section 302/324/147/148/149, P.P.C. and the case of the acquitted accused under section 148, P.P.C.
Mr. Muhammad Aslam Chishti, learned counsel appearing for the appellants contended as follows:‑‑
(1) Eye‑witnesses are not only related to the deceased, but are also interested witnesses, thus, their evidence without corroboration cannot be believed.
(2) Medical evidence regarding the deceased persons is inconsistent with the ocular evidence.
(3) Medical evidence regarding injury of Abdul Shakoor has not been placed.
(4) Recovery of kalashnikovs from appellants Gul Mir and‑Mehmood is not confidence inspiring.
(5) Motive is not alleged against the appellants, but it is alleged against the absconders.
(6) The prosecution case is not free from doubt, thus, the appellants are entitled to the benefit of doubt.
(7) Benefit of section 382‑B, Cr.P.C. has been withheld by the trial Court without giving any cogent reasons.
Mr.Mumtaz Hussain Mehfooz, Advocate appearing on behalf of the complainant contended that presence of the eye‑witnesses has been established and F.I.R. was lodged promptly, the accused persons were identified by the eye‑witnesses and have recognized the accused persons as the incident took place in broad daylight some of the empties recovered from the place of incident matched with the kalashnikovs recovered from appellants Gul Mir and Mehmood.
Mr. Nasrullah Khan Achakzai, learned counsel appearing for the State also adopted the arguments of Mr. Mumtaz Hussain Mehfooz, Advocate.
Mr. Muhammad Aslam Chishti, Advocate for the appellant strenuously alleged before us that the complainant P.W.2, Ghulam Ali and P.W.3, Abdul Shakoor and P.W.5, Rahim Dad are related to the deceased persons and are also interested witnesses, thus, their testimony without independent corroboration cannot be relied upon.
We are not inclined to agree with the contention of Mr. Muhammad Aslam Chishti,. Advocate, aforementioned eye‑witnesses were very much present at the place of occurrence and their presence has been established on record. During cross‑examination their presence at the place of incident has not been disputed. P.W.2, Ghulam Ali, who is complainant of the case stated that on the day of incident he alongwith deceased Arbab Ali, Haji Muhammad Rahim (deceased) P.W.3, Abdul Shakoor and P.W.5, Rahim Dad were present and harvesting the paddy crop, when the accused persons namely, Rehmatullah, Sanaullah, Amanullah, Abdul Karim, Abdul Hameed, Shahbaz, Garrah Khan, Karainullah, Najoodad, Muhammad alias Dado, Gul Mir Khadim Ali, Ghulam Rasool, Sachal and 5 other unknown persons came there and started indiscriminate firing upon them with kalashnikovs as 'a result of the firing Arbab Ali and Haji Muhammad Rahim died on the spot and P.W.3, Abdul Shakoor, received bullet injuries on his left leg.
It may be pointed out that the F.I.R. was, lodged promptly, the accused persons and the eye‑witnesses present at the place of occurrence were mentioned in the F.I.R. Besides, the incident took place in broad daylight and since the accused persons and the complainant party were also known to each other, thus, there was no chance of mistaken identity of the accused persons. Despite a lengthy cross‑examination complainant Ghulam Ali stood firm and could not be shaken and the presence of this witness was not denied. Nothing has been brought on record to show that he had any animus towards accused persons for false implication. The statement of complainant was further corroborated by the statement of P.W.3, Abdul Shakoor, who himself received bullet injuries which has not been denied by the prosecution during the cross‑examination and his presence has also been established beyond any shadow of doubt, he has also named all the accused persons including the appellants in the commission of offence. P.W.5, has also established his presence at the place of incident and he is also a witness of the site inspection report and in his presence blood‑stained earth of the deceased persons was also recovered, his presence has also not been disputed by the prosecution. Besides his presence has also been proved through documentary evidence site inspection Exh.P/5‑A and he is also a witness of the recovery of the blood‑stained earth Exh.P/5‑B and Exh.P/5‑C. The prosecution has not denied the presence of the aforementioned 3 eye‑witnesses it has only been alleged that the incident took place after dark and further the appellants were implicated in the case due to the enmity.
It maybe mentioned here that act of firing by the accused persons has been further corroborated from the recovery of 120 kalashnikov empties from the place of occurrence which further can support to the testimony of the eye‑witnesses that firing was made by many persons, as 120 empties were recovered soon after occurrence place of incident. All the eye‑witnesses unequivocally stated that the incident took place at about 3‑00 p.m. and the accused persons fired upon them from very close range i.e. from the distance of about 30 paces, thus, in such circumstances it can safely be held that accused persons were rightly identified by the eye‑witnesses as they were known to each other: The complainant Ghulam Ali and P.W.5, Rahim Dad have even explained that due to taking shelter in the watercourse they did not receive any bullet injury, which fact was also not disputed by the prosecution. Thus, the presence of the eye‑witnesses was established at the place, of incident.
As regards the arguments of Mr. Muhammad Aslam Chishti, Advocate that all the 3 eye‑witnesses being related to the deceased and were interested witnesses, therefore, without independent corroboration, no ‑reliance can be placed on their statements. It may be mentioned here that even the testimony of the interested witnesses without independent corroboration can be relied upon if the same is confidence inspiring. It may be pointed out that it is only the rule of prudence which requires of an interested witness to be corroborated independently and the said rule is not to be applied strictly in each and every case. It is no inflexible rule to be applied rigidly that in every case testimony of an interested witness cannot be relied upon without independent corroboration, there might be cases in which the witnesses are related to the deceased, but being natural witness furnishing direct and convincing evidence the same cannot be ruled out of consideration merely the witnesses are related to the deceased persons, their uncorroborated testimony can be implicitly relied upon if the same is otherwise confidence inspiring. In the present case as discussed above the presence of the eye‑witness has been established on record, F.I.R. being lodged promptly leaving no chance for deliberations and the witnesses standing the test of the cross‑examination giving a natural account of the incident, corroborating each other in material aspects of the case and their intrinsic value has not been shaken, thus, their testimony which otherwise is confidence inspiring cannot be discarded merely because they were related to the deceased and interested witnesses. Besides it was for the appellant to show that the witnesses had a strong motive to falsely implicate them in the commission of the offence, wherein they have failed to do so. In this regard reliance is placed on the following cases;‑‑
Niaz v. The State PLD 1960 Supreme Court 387.
Nazir Ahmed and others v. The State PLD 1962 Supreme Court 269.
27 In the former case the following observations were made:‑‑
"Whenever interested person claiming to be eye‑witnesses of an occurrence charge persons against whom they have some motive for false implication, with the commission of the offence, the first question to be considered is whether in fact they saw the occurrence and were in position to identify the culprits.
If there be no reason to doubt that they in fact witnessed the occurrence and were in a position to identify the offenders, the further question arises as to whether they can be relied upon for convicting the accused without corroboration. In cases where such interested witnesses charge one person. only with the commission of the offence, or where the number of persons whom they name does not exceed that which appears from independence evidence or from circumstances not open to doubt to be the true number of culprits their evidence may, in the absence of anything making it unsafe to do so, be accepted without corroboration, for, substitution is a thing of rare occurrence and cannot be assumed, and he who sets up the plea of substitution has to lay the foundation for it. But if the Court finds that the number mentioned by interested persons may have been exaggerated their word cannot be made the basis of conviction and the Court will have to look for some additional circumstances which corroborates their testimony."
"By what. we said in Niaz v. The State we were not laying down any rule of law though we were explaining for the guidance of Courts our own approach to the problem that generally confronts the Courts in cases of crime by violence ... . a. ... . .. ... ... ... ... ... ... ... ... ... ... ... ... ... _ . ... ... ... .. But we had no intention of laying down an inflexible rule that the statement of an interested witness (‑‑‑‑‑‑) can never be accepted without corroboration. There may be an interested witness whom the Court regards as incapable of falsely implicating an innocent persons. But he will be an exceptional witness and, so far as an ordinary interested witness is concerned, it cannot be said that it is safe to rely upon his testimony in respect of every person against whom he deposes. In order, therefore, to be satisfied that no innocent persons are being implicated alongwith the guilty the Court will in the case of an ordinary interested witness look for some circumstance that gives sufficient support to his statement so as to create that degree of probability which can be made the basis of conviction. This is what is meant by saying that the statement of an interested witness ordinarily needs corroboration."
The statement of the eye‑witnesses further gets support from the report of the balistic ‑expert i.e. Exh.P/10‑F. According to the report Exh.P/10‑F 4 empties of kalashnikovs out of 120 secured from, the place of incident matched with the kalashnikov recovered from the person of Gul C Mir, whereas 5 empties matched with the kalashnikovs recovered. from Mehmood, thus, in view of the above balstice expert report the statement of the eye‑witnesses is further strengthened.
Adverting to the next contention of Mr. Muhammad Aslam Chishti, Advocate that there are contradictions and variation in the prosecution case inasmuch as the ocular account is not consistent with the medical evidence. Mr. Muhammad Aslam Chishti, learned Advocate contended that all the eyewitnesses have stated. that the deceased person received many bullet injuries, whereas of the deceased received one bullet injury each. It may be mentioned `here that minor contradictions in the statement of the witnesses with the passage of time is but natural, which cannot materially brush aside the prosecution case, if such contradictions do not destroy the intrinsic value of the evidence of such witnesses; thus, the statement of the witnesses cannot be discarded, merely for minor variation, otherwise their testimony appears to be confidence inspiring and convincing. It may be mentioned here that. the presence of the eye‑witnesses has been believed and they were not shaken in cross‑examination, hence such minor contradictions in medical and ocular evidence would hardly matter. In this regard reliance is placed on Mushtaq alias Shaman v. The State PLD 1995 SC Page 46, wherein the following observations were made:‑‑
"These contradictory accounts given by the eye‑witnesses according to learned counsel raised the doubt about their presence on the scene of offence. The variation in the evidence of two prosecution eyewitnesses pointed out by the learned counsel for the petitioner does not relate to the material part of the prosecution case and as such it has no effect on the intrinsic value of the evidence of these witnesses. This Court in the case of Roshan and 4 others v. The State (PLD 1977 SC 557) while taking note of the fact that variation in the evidence of witness may occur due to various reasons which may be natural or artificial observed as follows:‑‑
As to the contradictions in the statements of the eye‑witnesses on which the defence has placed so much reliance, I may point out that some counsel devote all their energies to create such contradictions and to this end lengthy cross‑examination is conducted for hours and days which is intended to confuse, even an intelligent person, and is not calculated to elicit any .useful information. This exercise is undertaken because Courts give undue importance to the contradictions found in the statements of the prosecution witnesses. To my mind, the primary consideration in appraising the evidence given by a witness is to determine, firstly, why has he offered to testify? Has he seen the occurrence? If so, has the witness a motive to implicate a person who was not among the culprits or to exaggerate the part played by any of them? If a witness satisfies these two tests, then the Court should watch the general demeanour of the witness in order to judge the quality of his perception and his factually to recall the past incidents. A witness may make contradictory statements on some of the details of the incident in respect of Which he is deposing in Court. The variation may be due to mere lapse of memory or the confusion caused in his mind by a relentless cross‑examiner. Very often a witness gives an incorrect statement because he must answer every question regardless of the fact whether he knows the answer to it or not. It is not uncommon that the cross‑examiner puts words in the mouth of witnesses and the Presiding Officer is_ not vigilant enough to check it. It is also common experience that, without any particular intent, even educated people. exaggerate when, describing an event. Some witnesses may be prone to it more than others. Mere contradictions, therefore, do not lead to the 'result that whatever the witness has said on the salient features of the case and which conforms to the other evidence on the record, is to be thrown overboard. "
From the above‑quoted observations, it is quite clear that all variations in the evidence do not destroy the intrinsic value of the evidence of such witness. The variations which do not relate to material part of the prosecution story or the salient and important features of the case may be ignored for reasons given in the above‑quoted passage as immaterial. I am, therefore, of the view that the variations pointed out by the learned counsel for the petitioner in the evidence of two eye‑witnesses in this case, were not such which could affect the credibility of prosecution case.
Mr. Muhammad Aslam Chishti, learned counsel attempted to argue that the presence of injured Abdul Shakoor is doubted as the injury allegedly sustained by him was not, proved Suffice it to observe that the injury sustained by P.W.3, Abdul Shakoor was not denied by the prosecution, though the doctor who examined the said witness did not appear but the medical certificate issued by the Medical Officer Civil Hospital, Quetta regarding Abdul Shakoor was tendered in evidence by the Investigating Officer and the same was not objected to by the appellants. Besides it was not the case :of the appellants before the trial Court that P.W.3, Abdul Shakoor did not receive any injury before the trial Court, thus, the contention raised by the learned counsel is repelled.
Reverting to the contention of Mr. Muhammad Aslam Chisti, Advocate regarding motive. Record reveals that motive alleged for the commission of offence is old enmity, the prosecution though has alleged that there was old enmity between the parties but the particulars of the same have not been given. It is a settled principle of law, that prosecution is not bound to prove the motive but once, a motive is set up then its, is for the prosecution to prove the same. In the case in hand the motive alleged is old enmity but no details have been given of the same. Mr. Muhammad Aslam Chishti, Advocate pointed out that since the motived, therefore, the prosecution failed to prove the guilt of the appellant established beyond any shadow of doubt, we do riot agree with the learned counsel, though the prosecution has failed to prove the motive but case against the appellants has been proved beyond any shadow of doubt. It is for non‑proving the motive the trial Court has taken a lenient view. In our considered opinion the prosecution since failed to prove the motive the trial Court has rightly taken a lenient view by convicting the appellants to undergo R.I. for 20 years under section 302, P.P.C., thus, we are not inclined to interfere with the impugned judgment regarding quantum of sentence.
As the appellants Mehmood, Haji Gaboo, Rana, Karman and Wali Dad have already been acquitted under section 302/324, P.P.C. due to the compromise and their case is to be dealt with under section 148, P.P.C. As the parties have compromised through the intervention of their notables and their differences have been patched‑up, to honour the compromise and to leave a cordial atmosphere, we are inclined to reduce the sentence of 3 years under section 148 to that of already undergone the aforementioned appellants shall be released forthwith if not required in any other case.
Mr. Muhammad Aslam Chisti, Advocate lastly contended that the learned trial Judge while convicting the appellants have withheld the benefit of section 382‑B, Cr.P.C. without any cogent reasons. When confronted with the said aspect Mr. Mumtaz Hussain Mehfooz, Advocate and Mr. Nasrullah Khan Achakzai, learned counsel for the State could not answer the same satisfactorily, thus, in our considered opinion the trial Court could not with hold the benefit of section 382‑B, Cr.P.C. without giving any reasons. Thus, we are inclined to extend the benefit of section 382‑B, Cr.P.C. to the remaining appellants i.e. Gul Mir, Khadim Ali and, Ghulam Rasool. However, the fine imposed upon the appellants is set aside.
As a result of the above discussion with the remission of fine, the appeal of Khadim Ali, Gul Mir and Ghulam Rasool is dismissed.
N.H.Q./19/Q Order accordingly.
P L D 2000 Quetta 91
Before Aman Ullah Khan Yasinzai, J
ASHFAQ AHMED‑‑‑Appellant
Versus
Dr. ARBAB ALI AHMED ‑‑‑Respondent
First Appeal from Order No. 114 of 1999, decided on 27th March, 2000.
(a) West Pakistan Urban Rent Restriction Ordinance (VI of 1959)‑‑‑
‑‑‑‑S. 15‑‑Civil Procedure Code (V of 1908), O.XLI, R.27‑‑‑Appeal against ejectment order‑‑‑Additional evidence‑‑‑Production of‑‑‑Tenant/appellant alongwith appeal filed by him against ejectment order of Rent Controller had filed application for production of additional evidence‑‑‑Appellant/tenant wanted to summon representative of Excise and Taxation Department in respect of certain shops belonging to respondent/landlord which allegedly were lying vacant ‑‑‑Ejectment application filed by respondent/landlord against appellant/tenant remained pending for four years and tenant produced nine 'witnesses in support of his contention‑‑‑Nothing was on record to show that documents intended to be brought on record by tenant as additional evidence were not available to him at the time of his leading evidence‑‑‑In absence of cogent reason in support of application for additional evidence, said application was rightly rejected especially when documents intended to be produced as additional evidence had no relevancy with facts of the case.
(b) West Pakistan Urban Rent Restriction Ordinance (VI of 1959)‑‑‑
‑‑‑‑S. 13(3)(ii) & (4)‑‑‑Bona fide personal need of landlord‑‑‑Landlord in his ejectment application had claimed that he required shop in dispute for personal bona fide use and occupation of his son who was jobless‑‑Ejectment application was resisted by tenant contending that as son of landlord for whom shop was required was studying, personal requirement of landlord on that ground thus was based on mala fide‑‑‑Certificate produced by tenant to prove that son of landlord was a college student pertained to period prior to filing of ejectment application‑‑‑Nothing was on record to show that son of landlord had been employed or was on job at the time of filing ejectment application ‑‑‑Ejectment application having been decided after four years of its filing, son of landlord could not be expected to sit idle for such a long time‑‑‑Landlord had produced oral as well as documentary evidence to prove that his son was jobless and shop in dispute was quite suitable for business intended to be started therein‑‑‑Landlord, in his statement, had categorically stated that as soon as shop in disptue was vacated by tenant, same would be occupied by his son‑‑‑Protection had been given to tenant under S.13(4) of West Pakistan Urban Rent Restriction Ordinance; 1959 that if after .getting vacant possession of shop in dispute, same was not occupied by landlord within sitpulated period, tenant could make application to Rent Controller for possession of shop in dispute‑‑Landlord having proved his personal and bona fide need for shop in dispute for use and occupation of his son, Rent Controller had rightly ordered ejectment of tenant from the shop.
Juma Sher v. Sabz Ali 1997 SCMR 1062; Messrs F.K. Irani & Co:, v. Begum Feroz 1996 SCMR 1178 and Sheikh Muhammad Jameel v. Government of Pakistan through Secretary, Ministry of Finance, Islamabad and 2 others 1998 MLD 1049 ref.
Khushnood Ahmed for Appellant.
Mohsin Javed for Respondent.
Date of hearing: 3rd March, 2000.
JUDGMENT
This appeal under section 15 of the Balochistan Urban Rent Restriction Ordinance VI of 1959 is directed against the order dated 31‑8‑1999 passed by Civil Judge II‑cum‑Rent Controller, Quetta whereby eviction of the appellant has been ordered from the shop bearing Municipal No.l‑3/I‑A situated as Sooraj Ganj Bazar, Quetta (hereinafter referred to as the shop in dispute).
Briefly stated that facts of the case are that respondent filed an eviction application regarding the shop in dispute against the appellant on 3‑5‑1995 on the ground of personal requirement of his son namely Muhammad Jahangir, and default. Written Statement was filed on 13‑9‑1995 by the appellant. The Eviction Application was contested on legal and factual grounds. Out of the pleadings following issues were framed:‑‑
(i) Whether the respondent has failed to tender rent from September, 1994?
(ii) Whether the shop in question is required by the applicant in good faith for personal use and occupation of his son Muhammad Jahangir who is presently jobless? .
(iii) Relief?
The following additional issues were framed later on:‑‑
(i) Whether the applicant is not the son of Arbab Muhammad Azim Khan? and respondent got the shop from Arbab Azim who was owning the shop?
(ii) Whether the applicant has mentioned in his application the period from which the respondent made default?
The aforementioned, issues were struck off by the learned Rent Controller vide Order dated 15‑2‑1997. In support of the application, the applicant produced A.W.1 Maqbool Ahmad, A.W.2 Amir Hamza, A.W.3 Sollbat Khan, A.W.4 Muhammad Naeem, A.W.5 Javed Hasan, A.W.6 Ali Ahmad, A.W.7 Sham Kumar and statement of the respondent was recorded.
In rebuttal, the appellant produced R.W.1 Javed Iqbal, R.W.2 Abdul Wahid, R.W.3 Abdul Sattar, R.W.4 Hurnayun, R.W.5 Ishtiaq Ahmad, R.W.6 Syed Masoom Shah, R.W:7 Abdul Saboor, R.W.8 Muhammad Rahim, R.W.9 Muhammad Hussain and statement. of the appellant was also recorded.
After hearing the parties, the learned Rent Controller accepting the plea of personal requirement, ordered eviction of the appellant vide impugned judgment mentioned hereinabove; hence this appeal. Along with the appeal, the appellant has filed an application for additional evidence wherein it is prayed that he be allowed to bring on record certain documentary evidence as during the pendency of the Eviction Application, the said documents were not available. , Mr. Khushnood Ahmad, Advocate appearing for the appellant contended that the application for additional evidence may be allowed as during the pendency of the Eviction Application, certain documents which were not in the knowledge of the appellant could not be filed, as he is now in possession of the same which shows that the respondent is in possession of their shops which are lying vacant which negates his personal bona fides.
The learned counsel further contended that initially the shop in dispute was let out to Datha Radio which was leased by the,predecessor in interest of the appellant but the Eviction Application has been wrongly filed in the name of the appellant excluding their legal‑ heirs i.e. his brothers and sisters. He further stated that the property belonged to Arbab Muhammad Azim but the respondent not being son of Arbab Muhammad Azim cannot claim ownership of the same. The learned counsel opposing the Eviction Application on merits contended that personal bona fide use as averred in the application could not be proved but the learned Rent Controller has misread the evidence and has erroneously held that the shop in dispute is required by the respondent for the personal use and occupation of his son.
Mr Muhammad Mohsin Javed, Advocate for the respondent contended that the Eviction Application was filed in 1995 and the same. was pending till disposal i.e. up to 1999 and ample opportunities were given to the respondents to lead evidence; thus at this stage there is no justification for allowing additional evidence. The learned counsel further contended that even otherwise, the documents which the appellant wants to bring on record have no relevancy with the case in hand. Ire further stated that the respondent is tenant of the applicant and is exclusively doing business; thus there was no need to join his brothers and sisters. As far as merits of the case are concerned, the learned counsel contended that the same was proved. and eviction has been rightly ordered by the learned Rent Controller.
I have heard the arguments of the learned counsel for the parties and have perused the record minutely.
Coming to the application for additional evidence, it is mentioned in the same that the appellant wants to summon the representative of Excise and Taxation Department in respect of certain shops belonging, to the respondent and which are lying vacant. It is noted that the Eviction Application was filed in the year, 1995 and was ultimately decided on 31‑8‑1999 i.e. after more than four years. The appellant produced nine witnesses in support of his contention. There is nothing on record to show that the documents intended to be brought on record were not available. The same have been issued by the Excise and Taxation Department, thus no cogent reason has been given in support of .the application for additional evidence. Besides, from the perusal of the said documents it reveals that the shops belong to Mst. Bibi Fatima, widow of Arbab Muhammad Azim. Thus, the said documents have no relevancy with the facts of the case in hand; therefore, the application for additional evidence is rejected.
Mr. Khushnood Ahmad, Advocate contended that initially the shop in dispute was rented out by the father of the appellant who was the owner of Datha Radio and further stated that the rent receipts issued have also been in the name of Datha Radio, thus the Eviction Application in the name of respondent is not maintainable.
Mr. Muhammad Mohsin Javed, Advocate for the respondent argued that only the respondent is doing business in the name of Datha Radio but as far as Datha Radio is concerned, it is not a legal entity. It is neither a registered firm nor a company. When confronted with the said position, Mr. Khushnood Ahmad, Advocate conceded that the appellant is doing business in the name of Datha Radio which is neither registered nor a company having any legal entity. Mr. Muhammad Mohsin Javed, Advocate further stated that previously an Eviction Application was filed by the appellant regarding the shop in dispute which was disposed of on 2‑10‑1994 and where the appellant accepted to be tenant of respondent. Previously an Eviction Application was filed by the respondent against the appellant which was disposed of on 2‑10‑1994. The order dated 2‑10‑1994 is reproduced below:‑‑
From the aforesaid order it appears that in the previous round of litigation, the respondent never raised the plea that the shop in dispute was rented out to M/s. Datha Radio, thus his plea that the shop in dispute was rented out to his father is repelled.
Reverting to the next contention regarding title of the appellant, Mr.Khushnood Ahmad, Advocate attempted to argue that since the shop in dispute belonged to Arbab Muhammad Azim and the appellant was not his legal heir; thus he could not be termed as owner/landlord of the premises in dispute; suffice it to observe that in the previous round of litigation, the appellant has accepted the respondent as his landlord and thereafter‑he cannot be allowed to dispute the title of the respondent. It may further be observed that the respondent has proved that the shop in dispute was gifted to him by late Arbab Muhammad Azim and in this regard a gift deed was also executed which was brought on record as Exh.A/4 and on the basis of the same the shop in dispute was entered in the Revenue Record' in the name of the respondent. Copy, of the mutation entry has been brought on record as Exh.A/5. Thus in view of the above, the contention that title of the respondent is defective, is repelled.
Coming to the merits of the case regarding personal bona fide use, it is the case of the respondent that he requires the shop in dispute for personal bona fide use and occupation of his son Muhammad Jahangir who is jobless: In this regard, respondent produced A.W.1 and A.W.2 and got recorded his own statement. Both the witnesses have categorically stated that the son of the applicant wants to do business of electronic goods in the shop in dispute and have .also brought on record that Sooraj Ganj Bazar is suitable for electronics goods. 'The statement of the respondent regarding personal bona fide use and occupation of his son is consistent with the averments made in the plaint.
Mr. Khushnood Ahmad, Advocate for the appellant contended that the respondents had filed Eviction Applications against their other tenants who are occupying their shops situated at Jinnah Road and Shahrah‑e‑Iqbal, Quetta. The applicant in his cross‑examination stated that the Eviction Application filed in respect of the shop situated at Jinnah Road was for his own personal use and occupation as he is a doctor whereas the other eviction application filed in respect of the shop situated at Shahrah‑e‑Iqbal was for the occupation of his son. Besides, the learned counsel has failed to show that the eviction application filed in respect of these shops were vacated or not but. there is nothing on record to suggest that the Eviction Applications in respect of the other shops were filed for the personal bona fide use and occupation of his son namely Jahangir. It may be observed that the eviction application regarding the other tenants were very much in the notice of the appellant but the same were not brought on record. Thus no adverse inference can be drawn against the respondent regarding personal bona fide use and occupation of his son Jahangir in respect of the shop in dispute. Regarding personal bona fide use and occupation of the applicant reliance is placed on the following cases:
"We have gone through the statement of the appellant recorded before the Rent Controller in the case. The appellant in his evidence clearly stated that he required the premises for his personal and bona fide need and that he is presently not occupying any other shop or premises where he could do the business in the cantonment area. He was subjected to a very lengthy cross-examination by the counsel for the respondent but his evidence could not be shaken. Nothing was brought on record to show that the appellant was in possession of arty other property in the cantonment area suitable for his needs and requirements. It has been held by this Court in the case F.K. Irani & Co. v. Begum Feroz 1996 SCMR 1178, that even the sole testimony of the landlord is sufficient to establish the personal and, bona fide requirement of landlord. In the case before us, the statement by the appellant on oath was quite consistent with his averments made in the ejectment application and neither this statement was shaken nor anything was brought in evidence to contradict his statement: In fact, the respondent did not even step in the witness‑box to controvert the testimony of the appellant in the case. In these circumstances, the Rent Controller was fully justified in accepting the evidence of the appellant and ordering eviction of respondent from the premises."
"There is nothing on record to doubt the bona fides of the appellant. Merely the ownership of other shops in the same premises would not disentitle a landlord for getting specific shops vacated for running his business or for the benefit of his son for running a business. The appellant's son is admittedly unemployed and it has been brought on record through evidence that the appellant requires the premises in dispute for the benefit of his son for running a business. The appellant's son is admittedly unemployed and it has been brought on record through evidence that the appellant requires the premises in dispute for the benefit of his son for running a medical and general store. The law in this regard is quite established that the choice in these matters lies with the landlord and not with the tenant or the Rent Controller."
Mr. Khushnood Ahmad, Advocate contended that since the son of the respondent is studying, therefore, his personal requirement is based on mala fides. The learned counsel referred to document Mark R/1 which is the certificate from Principal, Government Degree College, Mastung that in the year 1993‑95, Jahangir Ahmad was a regular student of the college. It may be mentioned here that the certificate issued pertains to 1993‑95. There is nothing else to show that the son of the respondent had been employed or was on job at the time of filing of‑the Eviction Application. Besides, the Eviction Application was filed in 1995 and decided in 1999 and the son of the applicant could not be expected to sit idle for such a long period. The respondent in his statement 'has categorically stated that as soon as the premises in dispute is vacated by the appellant, the same will be occupied by his son. It may be mentioned that protection has been given to the tenant under section 13(4) of the Ordinance that if after getting vacant possession of the shop in dispute, the same is not occupied within the stipulated period, the appellant can make an application to the Rent Controller for possession of the shop in dispute.
Thus the contention that the respondent failed to prove personal and bona fide use and occupation of his son Muhammad Jahangir is without substance. As a result of the above discussion. I see no merits in the appeal which is dismissed. Appellant is granted four months' time to vacate the premises in dispute.
H.B.T./31/Q Appeal dismissed.
P L D 2000 Supreme Court 1
Present: Saiduzzaman Siddiqui, Sh. Ijaz Nisar and Sh. Riaz Ahmed, JJ
Criminal Appeal No.249 of 1996
KHAWAND BAKHSH and others‑‑‑Appellants
versus
THE STATE and others‑‑‑Respondents
Criminal Appeal No.250 of 1996
THE STATE through Advocate‑General, Balochistan, Quetta ‑‑‑Appellant
versus
BANGUL KHAN‑‑‑Respondent
Criminal Appeal No.302 of 1997
Mrs. SALLAL AKBAR BUGTI‑‑‑Appellant
versus
BANGUL KHAN and another‑‑‑Respondents
Criminal Appeals Nos. 249, 250 of 1996 and 302 of 1997, decided on 6th October, 1999.
(On appeal from the judgment/order dated 24‑6‑1996, passed by the High Court of Balochistan, Quetta, in Criminal Appeal No. 158 of 1994).
(a) Penal Code (XLV of 1860)‑‑‑
‑‑‑‑Ss. 302/120‑B/34 & 324‑‑‑Constitution of Pakistan (1973), Art. 185(3)‑‑Leave to appeal was‑ granted by Supreme Court to accused to consider whether sufficient corroboration was available warranting their conviction after disbelieving the ocular testimony qua acquitted co‑accused.
(b) Penal Code (XLV of 1860)‑‑‑
‑‑‑Ss. 302/120‑B/34 & 324‑‑‑Constitution of Pakistan (1973), Art.185(3)‑‑Leave to appeal was granted by Supreme Court to the prosecution and widow of the deceased to see whether the acquittal of accused was justified.
(c) Penal Code (XLV of 1860)‑‑‑
‑‑‑‑Ss. 302/120‑B/34 & 324‑‑‑Constitution of Pakistan (1973), Art. 185‑‑‑Appeal against acquittal‑‑‑Accused did not appear to be present at the scene of occurrence at the relevant time‑‑‑Nothing was recovered from the accused at the time of his arrest‑‑‑Accused was not identified in the identification parade‑‑High Court had not accepted the judicial confession of accused for valid reasons‑‑‑Participation of accused in the occurrence was, therefore, doubtful and no miscarriage of justice had taken place by his acquittal‑‑‑Appeals against acquittal of accused by the State. and widow of the deceased were dismissed accordingly.
(d) Penal Code (XLV of 1860)‑‑‑
‑‑‑‑Ss. 302/120‑B/34 & 324‑‑‑Appraisal of evidence‑‑‑Accused had been identified in the identification parade‑‑‑Fire‑arms recovered from the accused had matched with the crime empties recovered from the spot‑‑‑Injured eyewitnesses accompanying the deceased at the relevant time had named the accused as perpetrators of the crime‑‑‑Accused had a motive against the deceased‑‑Convictions and sentences of accused were upheld in circumstances.
Tawaib Khan and another v. The State PLD 1970 SC 13; The State v. Mushtaq Ahmad PLD 1973 SC 418; Muhammad Shafi and 4 others v. The State 1974 SCMR 289; Aminullah v. The State PLD 1982 SC 429; Muhammad Nawaz v. The State 1984 SCMR 190 and Sikandar and 2 others v. The State PLD 1981 SC 477 ref.
(e) Penal Code (XLV of 1860)‑‑‑
‑‑‑‑Ss. 302/120‑B/34 & 324‑‑‑Appreciation of evidence‑‑‑Maxim: "Falsus in uno falsus in omnibus "‑‑‑Principles stated.
The rule about the indivisibility of the testimony of a witness is that ordinarily if he is found to have falsely implicated an accused person, he should not be relied upon with regard to the other accused in the same occurrence, but if his testimony stands corroborated by strong and independent circumstances regarding the other, the reliance might then be placed on him for convicting the other accused. The Courts are required to separate grain from the chaff by considering whether the same tainted evidence stands corroborated from some independent and strong circumstance or evidence. [p. 11) E '
Tawaib Khan and another v. The State PLD 1970 SC 13; The State v. Mushtaq Ahmad PLD 1973 SC 418; Muhammad Shafi and 4 others v. The State 1974 SCMR 289; Aminullah v. The State PLD 1982 SC 429 and Muhammad Nawaz v. The State 1984 SCMR 190 ref.
(f) Penal Code (XLV of 1860)‑‑‑
‑‑‑‑S. 302/34‑‑‑Sentence‑‑‑Mitigating circumstance‑‑‑Rifle recovered from accused was not found to have matched with any of the crime empties recovered from the spot but was only found to have been fired without specifying the Period of its use, which was an extenuating circumstance‑‑‑Sentence of death, of accused was altered to imprisonment for life in circumstances.
(g) Maxim‑
‑‑‑‑‑‑ Falsus in uno falsus in omnibus"‑‑‑Principles stated.
Sh. Muhammad Zamir, Advocate Supreme Court, Muhammad Munir Piracha, Advocate Supreme Court with Ch. Akhtar Ali, Advocate‑on‑Record for Appellant (in Criminal Appeal No.249 of 1996).
Raja Abdul Ghafoor, Advocate Supreme Court/Advocate‑on‑Record for Respondent (in Criminal Appeal No.249 of, 1996).
Raja Abdul Ghafoor, Advocate Supreme Court/Advocate‑on‑Record for A.‑G., Balochistan, Quetta for Appellant (in Criminal Appeal No.250 of 1996).
Muhammad Munir Piracha, . Advocate Supreme Court for Respondent (in Criminal Appeal No.250 of 1996).
Dr. Khalid Ranjha, Advocate Supreme Court and Raja Muhammad Afsar, Advocate‑on‑Record for Appellant (in Criminal Appeal No.302 of 1997).
Muhammad Munir Piracha, Advocate Supreme Court for Respondent No. l (in Criminal Appeal No.302 of 1997).
Raja Abdul Ghafoor, Advocate Supreme Court/Advocate‑on‑Record for Respondent No.2 (in Criminal Appeal No.302 of 1997).
Date of hearing: 24th June, 1999.
JUDGMENT
SH. IJAZ NISAR, J.‑‑‑These criminal appeals with the leave of the Court are directed against the judgment dated 24‑6‑1996, passed by the High Court of Balochistan, Quetta, in Criminal Appeal No. 158 of 1994.
Khair Jan son of Ellahi Bux, Khawand Bux son of Gella, Sabz Ali son of Kella and Bangul Khan son of Jam Khan were tried for the murder of Sallal Akbar Bugti. By judgment, dated 17‑11‑1994, Special Judge for Suppression of Terrorist Activities Court, convicted them under section 302 read with section 120‑B/34, P.P.C. and sentenced them to death. They were also convicted under section 324, P.P.C. and sentenced to 7 years' R.I. plus a fine of Rs.50,000 each to be paid to the legal heirs of the deceased, or in default thereof they were ordered to undergo further S.I. for one year each.
On appeal, a learned Division Bench of the High Court of Balochistan, Quetta, by means of judgment dated 24‑6‑1996 set aside the conviction and sentence of Bangul Khan, but maintained the conviction and sentences of the other accused.
The judgment of the High Court was challenged by the convicts as also by the State and Mrs. Sallal Akbar Bugti, widow of the deceased.
Leave was granted by this Court on 4‑10‑1996 to consider whether sufficient corroboration was available warranting conviction of the convicts named above after disbelieving the ocular testimony qua Bangul Khan accused respondent. Leave was also granted to the State and widow of the deceased to see whether the acquittal of Bangal Khan was justified. Since the above matters arise out of the common judgment, the same are being disposed of by this consolidated judgment.
The prosecution case, in brief, is that on 2‑6‑1992, at about Mughrib prayer time Sallal Akbar Bugti deceased accompanied by Piyara Bugti P.W.15, Irsala Khan P.W.16 and Mussa Farman P.W.17, was proceeding on Jinnah Road, Quetta, in the car bearing Registration No. DB‑7, driven by him. When he reached near Farah Chawk, eight armed persons riding a black Datsun started firing at him and other inmates of the car, as a result of which, Sallal Akbar Bugti died on the spot while. Piyara Bugti P.W.. 15 and Mussa Farman P.W.17 received injuries. The injured persons also fired at the accused but they succeeded to flee. Khurshid Alam, A.S.I. of Traffic Police, P.W.8, who was performing duty at Farah Chowk at that time, witnessed the occurrence. He immediately informed the higher police officials about the occurrence and got his statement Exh.P/8‑A, recorded before Malik Rasham Khan, S.H.O., Police Station City Quetta, P.W.24 who had immediately reached the place of occurrence. According to him, some of the accused were wearing lavies uniform and growing beards.
After recording the Fard‑e‑Biyan Exh.P/8‑A of Khurshid Alam, A.S.I., Malik Rasham Khan, S.H.O. conducted the preliminary investigation and despatched the dead body of the deceased for post‑mortem examination. Piyara Bugti injured was also sent to the hospital for medical examination. The S.H.O. inspected the spot and secured 42 empties of Kalashnikov and made them into a sealed parcel. He also secured blood‑stained earth from there. A pistol and rifle alongwith magazines of cartridges were also recovered from the car. Vehicle No.D.$.‑7 was also seized vide recovery memo. Exh.P/9‑A. He got prepared the site plan of the place of occurrence from Sardar Khalid Mahmood P.W.18.
The S.H.O. also examined Mr. Muhammad Nawaz Marri, the then Advocate and took into possession documents Exh.P/24‑A produced by him. He also got the confessional statement Exh.P/21‑B of Bangul Khan accused (since acquitted) recorded by P.W.21 Mr. Mazhar Mehmood, M.I.C. on 7‑6‑1992. He also arranged identification parade of the accused under the supervision of Shabbir Ahmed Shah, E.A.C. P.WA on 16‑6‑1992.
Amanullah Khan, S.I. P.W.14 and Sheryab Ali, D.S.P., P.W.26, arrested the accused on 2‑6‑1992 i.e. on the day of occurrence, from the office of Mir Muhammad Nawaz Marri, Advocate, situated at Jinnah Road, Quetta, and recovered Rifle No.310658 '223 bore alongwith 86 cartridges and 3 magazines from the possession of Khair Jan, appellant vide memo. Exh.P/14‑B. A China‑made 7.62 m.m. Rifle No.1509827 and 199 live cartridges were recovered from the possession of Khawand Bukhsh vide recovery memo. Exh.P/14‑B. A China made Rifle No.10031446, 7.62 m.m. alongwith 104 live cartridges was recovered from the possession of Sabz Ali appellant vide recovery memo. Exh.P/14‑C. No recovery was effected from Bangul Khan, accused (since acquitted). The fire‑arms recovered from the possession of the appellants were made into separate sealed parcels and sent to the Ballistics Expert for comparison with the crime empties recovered from the spot. The Expert reported vide Exh.P/26‑1 that the fire‑arms alleged to be recovered from the possession of Khawand Bukhsh and Sabz Ali appellants matched with the crime empties, while rifle 223 bore said to be recovered from Khair Jan was found to have been fired.
Rasool Bakhsh, S.H.O. P.W.22 also seized a double door black pick‑up from the house of late Amir Hamza Bugti, situated in Railway Housing Society, Quetta on the same day, vide recovery memo. Exh.P/2‑C. the pick‑up in question was said to have been used by the accused in the commission of the crime. Rafiullah Shah, P.W.23 recorded the statements under section 161, Cr.P.C. of Musa Farman, Arsalla Khan and Shahnawaz Khan, P.Ws. at Dera Bugti on 6‑6‑1992.
The motive for the commission of the offence was that Amir Hamza Bugti son of Haji Wadera Khan a relative of the accused had been murdered on 7th May, 1992. Haji Wadera Khan held Saleem Akbar Bugti son of Sardar Akbar Khan and his father responsible for the murder of his son. The accused are alleged to have avenged the murder of Hamza Bugti by killing Sallal Bugti deceased son of Sardar Akbar Bugti.
Dr. Amin Mangal, P.W.7 conducted the post‑mortem examination of the deceased and found the following injuries on his body:‑‑
"(i) One ovo‑circular wound directing front left to right on the right cheek prominence, two centimetres from the right eye conthus. (Enterance). The edges were inverted 1‑1/2" in diametre.
(ii) Wound of exit on the same side of skull posteriorly brusting the whole perioto‑accipital part, with brain matter, out alongwith fragments of skull bone, measuring 10 centimetre in length edges everted and irregular.
(iii) One guttur wound 5 centimetres Muscle deep in mid right clevicular region.
(iv) One ovo‑circular wound 1‑1/2 centimetres in the forth intercostal space just above the right nipple with inverted edges (Entrance wound).
(v) Exit wound was below . the inferior angle of right scapular. 5 centimetres in diameter with everted and torned edges, adjacent to the dorsal spine on the same side.
(vi) One guttur wound 1‑1/2 centimetres; skin deep on the base of right thumb dorsum.
(vii) One incised wound 2 centimetres 1/2 centimetre lateral to the wound No. 1."
According to him, the cause of death was injuries on the vital organs of the body by fire‑arm, haemorrhage and shock.
(i) Lacerated wound on the left side on neck, lateral aspect 4" x 2" in size.
(ii) Gunshot wound 1‑1/2" x 1" on left hand dorsel.
The patient was operated upon by Neurosurgeon, General Surgeon and Orthopaedic Surgeon.
Note of Neuro Surgeon.‑‑(1) Bullet injury in the head of left side of neck, bullet penetrated epicoonium.. on examination patient was conscious and pupils reacting to light. "
According to him, the patient was admitted on 2‑6‑1992 and discharged on 15‑6‑1992. The nature of injuries was grievous and were fresh in type.
To prove its case the prosecution produced 26 witnesses. Of them. Khurshid Alain, A.S.I. P.W.8, Piyara Bugti P.W.15, Arsalla P.W.1b. and Mussa Farman P.W.17 furnished the ocular account. Muhammad Tariq, S.I., P.W.3, Sultan Ali, S.I., P.W.9, Amanullah, S.I. P.W.14. Rasool Bakhsh, S.H.O., P.W.22, Rafiullah Shah, S.I. P.W.23, Malik Rasham Khan, S.H.O. P.W.24, Ghualm Farid, S.I., P.W.25 and Sheryab Ali, D.S.P., P.W.26, had investigated the case. Shabbir Ahmad Shah, E.A.C. P.W.4, had supervised the identification parade of the accused, in which Khurshid Alain, S.I. P.W.8, is reported to have identified Khawand Bakhsh, Sabz Ali and Khair Jan appellants. Mazhar Mahmood, M.I.C. r.W.21 had recorded the confessional statement of Bangul Khan accused‑respondent on 7‑6‑1992. Syed Abdullah Shah P.W.20, Chemical Examiner had detected human blood on the carpet of the vehicle of the o deceased' and the clothes worn by him. Malik Muhammad Ismail, Advocate, P.W.5 and Muhammad Ijaz P.W.11 deposed about the visit of armed men to the office pf Mir Muhammad Nawaz Marri, Advocate after the firing. The said armed persons were later found to be involved in the murder of Sallal Akbar Bugti deceased.
The appellants and Bangul Khan accused‑respondent denied the prosecution allegations. Khawand Bakhsh appellant made the following statement under section 342(2), Cr.P.C.:‑‑
"My relative Humza was murdered at Sui by Saleem Bugti. We, remained present at Sui for about few days in order to take Fatiha from the people. Thereafter, we came to Quetta and visited the then Chief Minister Mir Taj Muhammad Jamah and then visited the then Governor Gul Muhammad Khan Jogazai in connection with the murder case of late Amir Humza Bugti. Absconding accused Azizullah on phone took appointment from Mir Muhammad Nawaz Marri, Advocate in order to consult him about the murder case of late Amir Humza Bugti. In consequent upon the said appointment we reached the office of Mir Muhammad Nawaz Marri before Maghrib Prayer for consultation and handed over him some papers including an application addressed to the Chief Justice High Court of‑Balochistan by the late Amir Humza Bugti wherein it was mentioned that whenever he is murdered, Nawab Akbar Khan Bugti and his son Saleem' Bugti will be responsible for his murder. Meanwhile there was a call of Maghrib prayer and I asked one of the colleagues of Mir Muhammad Nawaz Marri for providing me Jae‑e‑Namaz and then I stood for offering my Maghrib Prayer and as soon as I stood for prayer we heard gunshots outside the office on Jinnah Road, Quetta. After the said firing Mir Muhammad Nawaz Marri, Advocate directed us to leave this office but we refused that there is firing outside the office. Thus, he himself left his office we remained present in his office for about 15 minutes and bolted his office from inside. After 15 minutes Mir Muhammad Nawaz Marri knocked the door of his office from outside and asked me in Balochi for opening the door, so I opened the door. Mir Muhammad Nawaz Marri alongwith Police entered into his office and Police arrested me and the other accused persons present in the Court. We are not the murderer of late Sallal Akbar Bugti and the murderer of Sallal Akbar Buti was someone else from whom the revenge has already been taken by the heirs of late Sallal Akbar Bugti as in this regard Saleem Akbar Bugti stated in his interveiw given to B.B.C. and the news of same was published in daily Mashriq. Quetta, dated 3‑3‑1994. I produce the same news item as Exh.D/1‑A (subject to. objection of A.D.A.). The rifle recovered from me was legally possessed by me under Rahdari permit No;841 dated 9‑6‑1991. I produce the original Rahdari of the same .as Exh.D/1‑B. I am innocent and falsely been implicated in this case."
The other accused also adopted the above statement. Khawand Bakhsh and Sabz Ali appellants admitted the recovery of the fire‑arms from their possession and stated that the same were legally kept by them under Rahdari permits. No defence evidence was led by any of the accused.
Relying on the evidence adduced by the prosecution the learned trial Court convicted and sentenced all the accused under section 302 read with sections 120‑B/34, P.P.C. and 324, P.P.C. However, on appeal a Division Bench of the High Court of Balochistan set aside the conviction of Bangul Khan, but maintained the conviction and sentence of the other accused.
Challenging the conviction and sentence of the appellants, the learned counsel representing them have made the following contentions:‑‑
(a) That none of the accused is named in the F.I.R. and further that it looses its evidentiary value because it was recorded at the spot after preliminary investigation;
(b) that the eye‑witnesses produced by the prosecution were interested against the accused and were examined by the police after a considerable delay without any sufficient cause. Their evidence is, thus, unworthy of credence;
(c) that the incriminating articles were sent to the laboratories after a considerable delay without any justification;
(d) that the prosecution did not examine the police officials, who had kept the sealed parcels in their custody or had taken the same to the laboratories;
(e) that the identification parade was delayed one and except the accused no other person was made to participate in it;
(f) that no independent witness from the locality was examined to prove the occurrence;
(g) that the confessional statement of Bangul Khan accused‑respondent was recorded very late and was the result of duress and coercion;
(h) that Bangul Khan respondent was proved to be present in the office of Mir Muhammad Nawaz Marri, Advocate at the relevant time and not at the spot as alleged by the prosecution;
(i) that the appellants have been falsely .involved on account of enmity; and
(j) that the eye‑witnesses examined by the prosecution having been disbelieved in respect of Bangul Khan accused could not be relied upon against the other accused.
There is no dispute about the date, time and place of occurrence, nor about the murder of a relative of the accused named Hamza Bugti, about a month before the murder of Sallal Bugti deceased and the suspicion entertained by Idamza Bugti deceased against Nawab Muhammad Akbar Khan Bugti and his son of his murder, whenever .committed. The arrest of the accused alongwith the fire‑arms from the office of Mir Muhammad Nawaz Marri, the then Advocate, situate close to the scene of occurrence by the police is also not disputed. Being injured, the presence of Piyara Bugti P.W.15, Mussa Farman, P.W.17 in the vehicle' of the deceased can also not be doubted. Arsalla Bugti P.W.16, bodyguard of the deceased, is another eye‑witness, who was accompanying them at the relevant time. The statements made by them are consistent and coherent with regard to the manner of the occurrence. The mere fact that they were examined by the police a few days after the occurrence will not materially detract anything. from their evidence particularly in the wake of the admission of the accused that they had no personal animus against them. They cannot, thus, be dubbed as interested witnesses.
The delay in the examination of the eye‑witnesses stands reasonably explained. Piyara Bugti P.W. could not be examined earlier because he remained admitted in the hospital for 10/12 days, likewise the other P.Ws. had left for Derra Bugti, probably, to participate in the funeral rites of the deceased and were examined by the police on 6‑6‑1992 i.e. 4 days after the occurrence. Since they were not the residents of Quetta they left for Sui/Dera, their place of abode and were examined when the police contacted them.
No doubt, the names of the accused do not find mention in the Fard‑e-Biyan Exh.P/8‑A of Khurshid Alam, A.S.I., but the other details of the occurrence given by him fully correspond to the ones given by the other eyewitnesses. He had mentioned in his Fard‑e‑Biyan that some of the assailants were wearing lavies uniform which fact stands corroborated by the arrest of the accused immediately after the occurrence clad in lavies uniform. Furthermore, he had. stated in the Fard‑e‑Biyan that he was in a position to identify the accused if he had a chance to see them. He was subjected to identification test supervised by Shabbir Ahmed' Shah, E.A.C. P.W.4 on 16‑6‑1992 and he correctly picked up Khawand Bakhsh, Khair Jan and Sabz Ali appellants. No weight can be attached to the contention of the learned counsel for the defence that in the identification parade no dummy persons were joined and there was none else except the accused at the time of the said parade. In this context, a reference may be made to the statement of Shabbir Ahmed Shah, E.A.C., who had conducted the identification parade. He categorically stated that he had joined 8 or 9 dummy persons in the identification parade. The delay in conducting the identification parade appears to be insignificant because of the claim of Khurshid Ali, A.S.I., P.W.8 immediately after the occurrence that he could identify the accused. Lack of any objection by the accused to have been shown to the witness prior to the identification parade also lends corroboration to the said piece of evidence. Since all the necessary formalities were observed by Shabbir Ahmed Shah, E.A.C., before conducting the parade, no defect can be found in the same.
The arrest of the accused from the office of Mir Muhammad Nawaz Marri, Advocate, by Shehryab Ali, D.S.P., P.W.26 with fire‑arms is another strong circumstance going against them. According to Sheryab Ali, D.S.P., on the information supplied by Mir Muhammad Nawaz Marri, Advocate, about the presence of some persons belonging to Bugti Tribe in his office, he visited his office and found the door bolted from inside which was opened at the asking of Mir Muhammad 'Nawaz Marri, Advocate and from there the accused were arrested alongwith fire‑arms. The fire‑arms recovered at the instance of Khawand Bakhsh and Sabz Ali had matched with the crime empties recovered from the spot. They have admitted their recovery in the statements made by them at the trial. The mere fact that they were in possession of Rahdari permits would not justify their use in the occurrence. The rifle recovered from the possession of Khair Jan though not found to match with the crime empties was found to have been used by the Ballistics Expert. The statements of Malik Muhammad Ismail, Advocate, P.W.5 and Muhammad Ejaz Hussain P.W.11 who were present in the office of Mr. Marri, at the relevant time corroborate Shehryab Ali, D.S.P. about the arrest of the accused from there.
The evidence examined, by the prosecution shows that when immediately after the firing some persons in malitia uniform entered into the office of Mr.Mir Muhammad Nawaz Marri, Advocate, carrying fire‑arms. Mr. Marry asked them to leave but they declined, on which he went downstairs and informed the police. The police immediately reached there and arrested them. According to the said D.S.P., they were the present accused. They have also not denied in their statements under section 342(2), Cr.P.C., their visit to the office of Mr. Marri, Advocate on the said date and time or having been arrested from that place. According to the accused, they had visited the office of Mir Muhammad Nawaz Marri, Advocate, to consult him about the murder case of late Mir Humza Bugti and had handed over some papers to him in that connection. This fact is not supported by any convincing material. If that was so. they should have examined Mr.Marri or any other person in this behalf but they did not do so. No such suggestion was put to Malik Muhammad Ismail, Advocate P.W.5 when he appeared in the witness‑box. If it had been so, why Mr.Marri should have asked them to leave his office and his informing the police about the presence of the some persons belonging to Bugti Tribe in his office and facilitating the police in their arrest. The accused should not have hesitated in going out if they were not involved in the occurrence in any manner. On the other hand, they bolted the door from inside of Mr. Marri's office after his departure and had unwillingly opened the same at the instance of Mr. Marri when he brought the police there.
It appears from the evidence that Bangul Khan accused respondent was already present‑ in the office of Mr. Marri when the firing had taken place at Jinnah Road. No recovery was effected from him at the time of his arrest. He was also not identified in the identification parade by Khurshid Alam, A.S.I. The judicial confession made by him was not accepted by the learned High Court for valid reasons. In this view of the matter, his participation in the occurrence appears to be doubtful. He was, therefore, rightly acquitted by the learned High Court. We see no reason to differ with the conclusion arrived at by the learned High Court about his participation in the occurrence, nor find that any miscarriage of justice has been taken place by his acquittal. In consequence the State Appeal (Criminal Appeal No.250 of 1996) and Criminal Appeal No.302 of 1997, filed by Mrs. Sallal Akbar Bugti, are dismissed.
So far as Khawand Bakhsh and Sabz Ali (appellants in Criminal Appeal No.249 of 1996) are concerned, they were identified in the identification parade, the fire‑arms recovered from them were found to have matched with the crime empties recovered from the spot. They are named by the injured eye‑witnesses accompanying the deceased at the relevant time. They had a motive against the deceased. They were, therefore, rightly convicted and properly punished. Their appeal is dismissed. The principle of falsus in uno falsus in omnibus would not be applicable to their case because of availability of sufficient corroboratory material against them. The rule about the indivisibility of the testimony of a witness is that ordinarily if he is found to have falsely implicated an accused person, he should hot be relied upon with regard to the other accused in the same occurrence, but if his testimony stands corroborated by strong and independent circumstances regarding the other, the reliance might then be placed on him for convicting the other accused. The Courts are required to separate grain from the chaff by considering whether the same tainted evidence stands corroborated from some independent and strong circumstance or evidence. The following cases may be cited where the circumstances in which the principle of falsus in uno falsus in omnibus and its applicability in Pakistan in different situations was elaborately discussed:‑‑
(i) Tawaib Khan and another v. The State PLD 1970 SC 13, (ii) The State v. Mushtaq Ahmad PLD 1973 SC 418, (iii) Muhammad Shafi and 4 others v. The State 1974 SCMR 289, (iv) Aminullah v. The State PLD 1982 SC 429, and
(v) Muhammad Nawaz v. The State 1984 SCMR 190.
The delay in dispatching the crime weapons and empties also does not appear to be of any significance because according to the report of the Ballistics Expert seals on the parcels were intact when the same were received by him, and further that no suggestion was made to the concerned prosecution witnesses that the crime empties or fire‑arms were tampered with at any stage, nor were they cross‑examined as to the reason for the delay in dispatching the sealed parcels to the Ballistics Expert. In this behalf, a reference may be made to Sikandar and 2 others v. The State PLD 1981 SC 477, at p.483 where the above principle was enunciated. The relevant portion is reproduced below:‑‑
"As in the case of Noor Alam, the evidence in the present case is that the articles found stained with blood were secured under a proper Mushirnamas and properly sealed and there was not even a suggestion of any tampering. The Investigating Officer was also not cross‑examined as to the delay in sending the parcels to the Chemical Examiner. The High court was, therefore, not in error in relying on the recoveries as corroboration of the ocular evidence."
However, the case of Khair Jan (appellant No.3 in Criminal Appeal No.249 of 1996) appears to he distinguishable from Khawand Bakhsh and Sabz Ali appellants because the rifle recovered from him was not found to have matched with any of the crime empties recovered from the spot but was only found to have been fired without specifying the period of its use, therefore. considering it to be an extenuating circumstance, we think that the ends of justice will be met if he is awarded the lesser sentence provided for the offence of murder. We order accordingly, and alter his death penalty to imprisonment for life plus a fine of Rs.50.000, or in default to undergo further R.I. for one year with benefit of section 382‑B, Cr.P.C. However, his conviction and sentence under section 324/34, P.P.C. for causing injuries to the injured P.Ws. is maintained. Both the sentences shall run concurrently. With this modification in the sentence his appeal is otherwise dismissed.
N.H.Q./K‑48/S Order accordingly.
P L D 2000 Supreme Court 12
Present: Munawar Ahmed Mirza, Mamoon Kazi and Sh.Riaz Ahmed, JJ
MUHAMMAD AFZAL‑‑‑Appellant
versus
GHULAM ASGHAR and others‑‑‑Respondents
Criminal Appeals Nos.356 and 357 of 1994, decided on 20th October, 1999.
(On appeal from the judgment of the Lahore High Court, dated 29‑3‑1994 passed in Criminal Appeal No.79 of 1991 and Criminal Revision No.145 of 1991).
(a) Penal Code (XLV of 1860)‑‑‑
‑‑‑‑S. 302/34‑‑‑Constitution of Pakistan (1973), Art.1185(3)‑‑‑Leave to appeal was granted by Supreme Court firstly to consider whether High Court was justified in awarding lesser punishment to accused on the ground referred to in the judgment, and secondly to examine whether in view of the observations made in the impugned judgment, conviction of other accused under S.302/34, P.P.C. was justified.
(b) Penal Code (XLV of 1860)‑‑‑
‑‑‑‑S. 302/34‑‑‑Appraisal of evidence‑‑‑Line of reasoning adopted by High Court while allowing lesser sentence of imprisonment for life to the accused did not appear to be based on correct appreciation of evidence‑‑‑Observation of High Court that the motive for the occurrence was shrouded in mystery was not supported by evidence on the record‑‑‑Prosecution had not only established motive in the case, but it had also established that the offence committed by the accused was premeditated and although the shot fired by the main accused from his pistol had caused the fatal injury to the deceased, but the other accused had also shared the same intention with him‑‑‑Act of ‑main accused was too brutal an4 merciless who had killed a young man of about 18 years depriving him of his life in prime of his youth‑‑‑Sentence of imprisonment for life awarded to accused by High Court was converted into sentence of death in circumstances‑‑‑Conviction and sentence of other accused were also upheld accordingly.
Sher Zaman v. The State 1973 SCMR 503; Niaz Ahmad v. Naim Akhtar 1977 SCMR 159; Muhammad Mukhdoom v. The State 1984 SCMR 837; Muhammad Yaseen v. Muhammad Shafique 1997 SCMR 1527; Akram Beg v. The State 1998 SCMR 317; Muhammad Ishaque Khan v. The State PLD 1994 SC 259; Muhammad Ashraf v. The State 1981 SCMR 856; Ghulam Muhammad v. The State 1972 SCMR 393; Muhammad Sharif v. Muhammad Javed alias Jeda Tedi PLD 1976 SC 452 and Bismillah v. Muhammad Jabbar 1998 SCMR 860 ref.
(c) Penal Code (XLV of 1860)‑‑‑
‑‑‑‑S. 302/34‑‑‑Sentence‑‑‑Interference by Supreme Court‑‑‑Supreme Court is reluctant to interfere with the sentence awarded by High Court unless the sentence is against law or it is not in consonance with sound judicial principles.
Niaz Ahmad v. Naim Akhtar 1977 SCMR 159; Muhammad Mukhdoom v. The State 1984 SCMR 837; Muhammad Yaseen v. Muhammad Shafique 1997 SCMR 1527; Akram Beg v. The State 1998 SCMR 317; Muhammad Ishaque Khan v. The State PLD 1994 SC 259; Muhammad Ashraf v. The State 1981 SCMR 856 and Ghulam Muhammad v. The State 1972 SCMR 393 ref.
(d) Penal Code (XLV of 1860)‑‑‑
‑‑‑‑S. 302/34‑‑‑Sentence‑‑‑Where circumstances of the case do not justify awarding of lesser penalty of imprisonment for life, sentence of death is to be awarded by the Court.
Muhammad Sharif v. Muhammad Javed alias Jeda Tedi PLD 1976 SC 452 and Bismillah v. Muhammad Jabbar 1998 SCMR 860 ref.
Zamir Hussain, Advocate Supreme Court and Malik Ainul Haq, Advocate Supreme Court for Appellant (in Criminal Appeal No.256 of 1994).
Respondent No.3 in person (in Criminal Appeal No.256 of 1994).
Sardar Muhammad Ishaq, Advocate Supreme Court for Appellant (in Criminal Appeal No.357 of 1994).
Malik Ainul Haq, Advocate Supreme Court for the State (in Criminal Appeal No.357 of 1994).
Date of hearing: 19th May, 1999.
JUDGMENT
MAMOON KAZI, J.‑‑These two appeals arise out of the judgment passed by the Lahore High Court, Rawalpindi Bench, Rawalpindi, dismissing Criminal Appeal No.79 of 1991 filed by appellants Ghulam Asghar and Mumtaz Hussain, and Criminal Revision No. 145 of 1991 filed by appellant Muhammad Afzal.
3.? Case of, the prosecution against the said appellants is that, on 5‑2‑1990, at about 3‑00 p.m. when deceased Nazir Iqbal was sitting in front of Baithak of one Sher Jang alongwith his father, Muhammad Afzal, and one Nadeem Iqbal, the two appellants and their acquitted co‑accused went there and attacked Nazir Iqbal. Appellant Ghulam Asghar fired a shot at him with his pistol, which hit him on his abdomen, while Mumtaz Hussain gave a hatchet blow on his left arm. , The third accused was, however, empty‑handed the witnesses then intervened and got the deceased free.
Motive for the occurrence, as stated in the dying declaration made by the deceased to the Investigating Officer shortly after the occurrence was revenge, as appellant Ghulam Asghar and the deceased had an altercation about two or three months prior to the said occurrence where the deceased had allegedly made. assault on the said appellant.
The said dying declaration was recorded at Police Station Khorr at 4‑45 p.m. by A.S.I. Muhammad Adam Khan (P.W.14) on the basis of which a formal F.I.R. (Exh.PG) was drawn the same day at Police Station Pindigheb at about 5‑30 p.m. by P.W.4 H.C. Afzal Khan. In the meanwhile, Nazir Iqbal was shifted to T.H.Q. Hospital, Pindigheb where he expired at about 6‑15 p.m.
After recording of F.I.R. investigation was started by the police. Appellant Mumtaz Hussain and co‑accused Muhammad Iqbal were arrested on 13‑12‑1990 and on 20‑2‑1990, the former led the police to the recovery of a blood‑stained hatchet from his residence which was secured by the police under a Mashirnama. On the same day, appellant Ghulam Asghar was also arrested and a revolver was recovered by the police from his Dera.
The accused at their trial denied the said allegations. Appellant Ghulam Asghar also denied that he had been insulted by Nazir lqbal about two or three months prior to the said occurrence. The appellants also got their statements recorded under section 340(2), Cr.P.C., and examined Muhammad Raiz, Ghulam Ahmad and Muhammad Munsha Khan in their defence.
The case of the prosecution. rested on the evidence of twelve witnesses. P.W.11 Muhammad Afzal and P.W.12 Nadeem lqbal were the eye‑witnesses of the said incident. The former was the father of the deceased. Although the learned Judges in the High Court placed reliance on the evidence of the said eye?witnesses as they found their evidence to be straightforward and confidence inspiring, however, in regard to motive, the learned Judges were not impressed by the prosecution evidence as they. found that the alleged insult had been caused to accused Ghulam Asghar two or three months prior to the said occurrence during which the parties stayed in the village, yet no other unpleasant incident occurred. Consequently, the learned Judges concluded that something must have suddenly transpired between the deceased and the accused at the time of the attack. Therefore; according to .the learned Judges, real motive for commission of the said crime was shrouded in mystery and therefore, although, the conviction of the accused was maintained, but the sentence of death awarded to appellant Ghulam Asghar was altered to that of imprisonment for life. Revision filed by the complainant to challenge acquittal of the third accused and awarding of lesser punishment to Mumtaz Hussain by the trial Court was also dismissed.
Both the appellants as well as the complainant were dissatisfied with the said findings and they consequently filed their respective petitions for leave to appeal before this Court.
Leave was granted firstly on the question, whether the learned Judges were justified in awarding lesser punishment to appellant Ghulam Asghar on the ground referred to by them in the said judgment and secondly, to examine whether in view of the said observations made in the impugned judgment, conviction awarded to appellant Mumtaz Hussain under section 34, P.P.C. could be justified.
Taking a clue from the said observations made by the learned Judges in the High Court, Sardar Muhammad Ishaq Khan has firstly argued that, in case motive for commission of the said crime was shrouded in mystery and the prosecution had no clue as to what had suddenly transpired between the accused and the deceased just before the attack, accused Mumtaz Hussain cannot be said to have shared the same intention with co‑accused Ghulam Asghar. Therefore, conviction of accused Mumtaz Hussain under section 302/34, P.P.C. was liable to be set aside.
It is pertinent to point out in this regard that the line of reasoning adopted by the learned Judges in the High Court while allowing benefit of imprisonment for life to appellant Ghulam Asghar does not appear to be based on correct appreciation of evidence as the learned Judges in the High Court clearly appear to have overlooked the evidence of P.W.11, Muhammad Afzal and P.W.12, Nadeem Iqbal. the evidence of the said witnesses indicates that after the first incident, the deceased had left the village and had taken a job in Faisalabad. It was after his return from Faisalabad that the said occurrence took place. Therefore, the observations that the deceased and appellant Ghulam Asghar had stayed in the same village after occurrence of the said unpleasant incident were clearly against the evidence recorded by the trial Court. The learned Judges also appear to have overlooked‑the fact that the deceased had made a dying declaration where motive for the said crime was clearly stated to be the said unpleasant incident which had occurred a few months prior to the said occurrence. Therefore, in our opinion the observations made by the learned Judges that the motive for the said occurrence was shrouded in mystery, do not appear to be supported by evidence on the record.
Sardar Muhammad Ishaq Khan has, however, argued that, reliance cannot be placed on the dying declaration as allegedly the death of deceased. Nazir Iqbal had occurred shortly after the incident. Consequently, the deceased could not have been in a stable condition to make a dying declaration before the Investigating Officer. However, this contention is not supported by any medical evidence. Dr. Shahid Iqbal, the Medical Officer, who attended the deceased before his death, does not appear to have been cross‑examined by the defence counsel on this point. On the other hand, evidence of the Investigating Officer and P.W.11 Muhammad Afzal, the father of, the deceased, lends further corroboration to the fact that the deceased had made such dying declaration. Consequently, we are unable to agree with the said contention of the learned counsel.
Both the dying declaration as well as the evidence of P.W.11 Muhammad Afzal clearly indicate that the unpleasant incident, which is said to have occurred between the deceased and appellant Ghulam Asghar a few months prior to the said occurrence, was the motive for commission of the said crime. There appears to be no other evidence on record which can render this evidence doubtful. It would, therefore, be erroneous to assume that there was no clear evidence led, by the prosecution in regard to motive. In our view, the prosecution had not only succeeded to establishing motive to this case, but it was also established that it was a premeditated crime committed by the accused. So far as the question in regard to sharing of the common intention by accused Ghulam Asghar and Mumtaz Hussain is concerned, no doubt, it was allegedly D the shot fired by accused Ghulam Asghar from his pistol which is said to have caused the fatal injury to the deceased, but the circumstances further indicate that appellant Mumtaz Hussain had also shared the same intention with him. As was held by this Court in Sher Zaman v. The State 1973 SCMR 503, common intention can even be formed at the spur of the moment. Therefore, in our view there appears to be no doubt that both the accused had shared the same common intention at the time of commission of the said crime‑
Adverting now to the question of sentence, Mr. Zamir Hussain, learned counsel for the complainant has argued that in case motive has been successfully established by the prosecution and there are no mitigating circumstances available in the case to justify awarding of lesser punishment of life imprisonment to accused Ghulam Asghar, maximum penalty of death should have been awarded to the said accused. The contention of Sardar Muhammad Ishaq, on the other hand, was that as benefit has already been allowed to accused Ghulam Asghar by the High Court for which reasons have also been assigned, further interference by this Court on the question of sentence would be unwarranted.
Several judgments of this Court can be referred to in support of the contention of Sardar Muhammad Ishaq (See Niaz Ahmad v. Naim Akhtar 1977 SCMR 159; Muhammad Mukhdoom v. The State 1984 SCMR 837; Muhammad Yaseen v. Muhammad Shafique 1997 SCMR 1527; Akram Beg v. The State 1998 SCMR 317; Muhammad Ishaque Khan v. The State PLD 1994 SC 259; Muhammad Ashraf v. The State 1981 SCMR 856 and Ghulam Muhammad v. The State 1972 SCMR 393. The said judgments clearly indicate that reluctance has been shown by this Court to interfere with the sentence awarded by the High' Court unless the sentence is against law or it is not in consonance with sound judicial principles. However, as pointed out earlier, the findings of the learned Judges in the High Court that motive for commission of the crime was shrouded in mystery are not warranted by the circumstances of the case. Even otherwise, it is erroneous to assume that in every case, if motive for commission of the crime is pot established by the prosecution, benefit of lesser punishment of imprisonment for life should go to the accused. We would like to point out that this principle cannot be applied in every case as a general rule. There may be cases where, though, motive is not established, but owing to heinous nature of the crime the accused may not be entitled to any leniency while awarding punishment to him. Therefore, the question would depend upon the circumstances of each case. However, circumstances of the present case clearly indicate that there are no mitigating factors, benefit of which may go to appellant Ghulam Asghar. The circumstances of the case indicate that the act of? the accused was too brutal and merciless. The deceased was a young man of about 18 years and he was deprived of his life when he was in the prime of his youth. It is no gainsaying that it circumstances of the case do not justify awarding of lesser penalty of imprisonment for life, sentence of death is to be awarded by the Court. In Muhammad Sharif v. Muhammad Javed alias Jeda G Tedi PLD 1976 SC 452 tendency of the Courts to find pretext to alter a sentence of death to imprisonment for life was disapproved by this Court in strong words. This judgment has been followed by this Court in other cases as well. In Bismillah v. Muhammad Jabbar 1998 SCMR 860, recently decided by this Court, benefit of lesser punishment allowed to the accused by the High Court by conversion of death penalty to sentence of imprisonment for life was declined in view of the heinous nature of the crime.?
In the result, Appeal No.356 of 1994 filed by Muhammad Afzal is allowed and the sentence of imprisonment for life awarded by the High Court to appellant Ghulam Asghar is converted into sentence of death. The sentence of accused Mumtaz Hussain shall however, remain intact. The other appeal filed by Ghulam Asghar and Mumtaz Hussain is dismissed.
N.H.Q./M‑396/S???????????????????????????????????????????????????????????????????? Order accordingly.
P L D 2000 Supreme Court 18
Present: Sh. Ijaz Nisar and Kamal Mansur Alam, JJ
FARHAT AZEEM ‑‑‑ Petitioner
versus
WAHEED RASUL and others‑‑‑Respondents
Criminal Petition for Leave to Appeal No. 163 of 1998, decided on 5th October, 1999.
(On appeal from the judgment/order, dated 28‑9‑1998, of the Lahore High Court, Lahore, passed in Criminal Appeal No.447 of 1998).
(a) Precedent‑‑
‑‑‑‑ Interpretation of varying precedents‑‑‑Criminal case‑‑‑Principle‑‑‑When two varying precedents laying down a law by the Supreme Court or the High Courts in criminal cases are available on a particular point, the one most relevant and applicable to the facts and circumstances of the case and delivered by a larger Bench should be followed.
Sikandar A. Karim v. The State 1995 SCMR 387 ref.
(b) Constitution of Pakistan (1973)‑‑‑‑
‑‑‑‑Art. 189‑‑‑Binding effect of decisions of Supreme Court‑‑‑Essentials for good judicial administration‑‑‑Principles emphasized.
Supreme Court is the highest judicial forum in the country, it has to interpret the law while hearing appeals from the judgments of the High Court and the subordinate judiciary. Invariably such matters are considered by more than one Judges having long experience and thrash out the proposition brought before them in the light of the chain of judgments rendered on the controversy in Issue and ensure that continuity of law is maintained as it is essential for good judicial administration.
The subordinate judiciary, should always give its utmost respect, regard and consideration to the judgments, decrees, directions and orders of the Supreme Court, for, it is necessary apart from the binding nature of the same for maintaining discipline in all ranks of the judiciary. When the Supreme Court itself gives due consideration to the earlier decisions rendered by it, it is not understood as to why the subordinate judiciary in Pakistan should turn a deaf ear to the judgments, awards, findings or observations of the Supreme Court. The Courts and authorities subordinate to the Supreme Court are under legal obligation to follow the law laid down by it, and if they consider that the case law cited before them is not relevant or applicable to the facts and circumstances of the case they are dealing with, then they should distinguish it with reasons showing application of mind by them. This exercise would enable the party citing the case‑law to understand as to why the precedents relied upon by it were not followed.
Syed Sajjad Hussain v. Secretary, Establishment Division, Cabinet Secretary, Islamabad and 2 others 1996 SCMR 284; Ataur Rehman v. The State PLD 1967 SC 23: Province of the Punjab through Secretary, Health Department v. Dr. S. Muhammad Zafar Bukhari PLD 1997 SC 351; Ashiq Hussain alias Muhammad Ashraf v. The State PLD 1994 SC 879: Sakhi Muhammad and another v. Capital Development Authority, Islamabad PLD 1991 SC 777 ref.
(c) Criminal Procedure Code (V of 1898)‑‑‑
‑‑‑‑Ss. 426, 497 & 498‑‑‑Suspension of sentence and grant of bail‑‑‑Principles.
The powers conferred on an Appellate Court under section 426, Cr.P.C. to suspend sentence pending the hearing of an appeal are not wider than the powers to release on bail under sections 497 and 498 of the Code. A person accused of a non‑bailable offence may not be released on bail if there appears reasonable grounds for believing that he has been guilty of an offence punishable with death or imprisonment for life unless strong grounds are made to appear that conviction is not liable to be sustained, bail under section 426, Cr.P.C. will not be granted.
The discretion has to be exercised judicially by considering the relevant facts without commenting on the merit of the case. If the contention raised requires consideration of the merits, the Appellate Court would refrain from entertaining such contentions. The Court cannot enter into a re‑appraisal of the evidence which should be considered at the time of hearing of the appeal. But, where on perusal of the facts and judgment impugned, the Court comes to the conclusion that the judgment suffers from any legal error, it would be justified to suspend the sentence and grant the bail. In this regard the reasonable and legal views expressed by the trial Court should be given due consideration and weight, but every effort should be made to ensure that neither the evidence is reappraised nor the merits of the case are discussed.
While deciding the bail matter the Court has to refrain from making such observations, which may prejudice the case of either party.
Sentence awarded by the trial Court should not ordinarily be suspended by the Appellate Court unless strong grounds are made out to appear that conviction under the offence in question or any other allied offence is not liable to be sustained, but it should not be taken as a total prohibition on the power of the Appellate Court to suspend the sentence and in suitable cases it may exercise the power on the basis of the principles laid down in proviso to subsection (1) to section 497, Cr.P.C.
Bahar Khan v. The Slate 1969 SCMR 81; Abdullah Khan v. Karamdad 1968 SCMR 1064; Maqsood v. Ali Muhammad and another 1971 SCMR 657; Abdul Ghafoor v. Anwaral Hassan and others 1978 SCMR 149; Faqir Muhammad v. Akbar 1979 SCMR 276; Haji Mir Aftab v. The State 1979 SCMR 320; Muhammad Ashraf v. The State 1971 SCMR 183; Noor Abdullah and another v. The State 1981 SCMR 859; Jamshed Azam v. The State 1990 SCMR 1393 and Muhammad Nawaz v. Muhammad Nawaz alias Naji and 4 others 1997 SCMR 1521 ref, (d) Criminal Procedure Code (V of 1898)‑‑‑
‑‑‑‑Ss. 426, 497 & 498‑‑‑Bail‑‑‑Court while deciding the bail matter has to refrain from making such observations which may prejudice the case of either party.
(e) Interpretation of statutes‑‑‑
‑‑‑‑ Where a statute itself lays down certain principles for doing some acts they may be taken as a guideline for doing something of the same nature which is in the discretion of the Court.
(f) Criminal Procedure Code (V of 1898)‑‑‑
‑‑‑‑S. 426‑‑‑Penal Code (XLV of 1860), Ss. 302(b)/34 & 302(b)/109‑‑Constitution of Pakistan (1973), Art. 185(3)‑‑‑Suspension of sentence ‑‑‑Validity‑‑‑No good grounds were available for suspension of the sentence of accused who had been convicted by the competent Court and they were not entitled to the grant of bail‑‑‑Petition for leave to appeal was converted into appeal and the bail allowed to accused by High Court was cancelled accordingly.
Syed Sajjad Hussain v. Secretary, Establishment Division, Cabinet Secretary, Islamabad and 2 others 1996 SCMR 284; Ataur Rehman v. The State PLD 1967 SC 23; Province of the Punjab through Secretary, Health Department v. Dr. S. Muhammad Zafar Bukhari pLD 1997 SC 351; Ashiq Hussain alias Muhammad Ashraf v. The State PLD 1994 SC 879; Sakhi Muhammad and another v. Capital Development Authority, Islamabad PLD 1991 SC 777; Sikandar A. Karim v. The State 1995 SCMR 387; Bahar Khan v. The State 1969 SCMR 81; Abdullah Khan v. Karamdad 1968 SCMR 1064; Maqsood v. Ali Muhammad and another 1971 SCMR 657; Abdul Ghafoor v. Anwaral Hassan and others 1978 SCMR 149; Faqir Muhammad v. Akbar 1979 SCMR 276; Haji Mir Aftab v. The State 1979 SCMR 320; Muhammad Ashraf v. The State 1971 SCMR 183; Noor Abdullah and another v. The State 1981 SCMR 859 Jamshed Azam v. The State 1990 SCMR 1393 and Muhammad Nawaz v. Muhammad Nawaz alias Naji and 4 others 1997 SCMR 1521 ref.
Mian Fazl‑e‑Mahmood Fazli, Senior Advocate Supreme Court and S. Abul Aasim Jafri, Advocate‑on‑Record (absent) for Petitioner.
Muhammad Nawaz Kharral, Advocate Supreme Court and M.A. Zaidi, Advocate‑on‑Record for Respondents Nos. 1 to 3.
Afzaal Chohan, Addl. A.‑G., Punjab for the State.
Date of hearing: 5th October, 1999.
JUDGMENT
SH. IJAZ NISAR, J.‑‑This petition for leave to appeal is directed against the order, dated 28‑9‑1998, passed by the Lahore High Court, Lahore, in Criminal Appeal No.447 of 1998.
The facts, in brief, are that on 7‑8‑1996, at 2‑30 a.m. a case under section 302/449/109/34, P.P.C. was registered with Police Station Chak Jhumra, District Faisalabad, against unknown persons, at the instance of Farhat Azeem complainant (P.W.9) for the murder of his father Asmatullah deceased. According to him, on the day of occurrence, at 12‑30 a.m. (midnight) he heard fire reports from the side of their Dera. He rushed to the spot and saw his father Asmatullah deceased lying injured with fire‑arms. He died on the spot on account of those injuries. He saw four persons armed with fire‑arms running towards the West of Dera. Subsequently, Sarfraz P.W.12 and his father Abdur Rehman P.W.13 claimed to have seen Ghulam Rasool, Jehangir, Nawaz and Shahbaz Masih, entering the courtyard of the house of the deceased and firing at him. Azmat Ullah, Asmat Ullah and Waheed Rasool, respondents herein, alongwith others were challaned in this case.
The motive for the offence, as furnished by Nisar Ahmad P.W.14, was that he alongwith Waryam Khan P.W. (given up) went to Police Station Chak Jhumra in connection with personal business. At about 6‑00 p.m. two parties of Chak No. 153/RB were sitting separately in two plots of the said police station in connection with the investigation of a case. In the western plot, Waheed Rasul, Asmatullah and Azmatullah respondents were present alongwith Nisar Ahmad P.W. and Waryam Khan. Asmatullah son of Allah Rakha, Asmatullah son of Muhammad Khan and Waheed Rasul respondents, in their presence, instigated Ghulam Rasul, Jehangir, Nawaz and Shahbaz Masih their co‑accused that Asmatullah deceased, being brother of an M.P.A., opposed them in all matters and was taking personal interest against them and that he should be eliminated.
After. completing the investigation, the police challaned the respondents alongwith their co‑accused.
At the trial, the learned Additional Sessions Judge, Faisalabad, vide judgment dated 4‑5‑1998, convicted Jehangir and Shahbaz Masih co‑accused under section 302(b)/34, P.P.C. and sentenced them to death. Ghulam Rasul and Nawaz accused were convicted under section 302(b)/34, P.P.C. and sentenced to rigorous imprisonment for life. Asmatullah s/o Allah Rakha, Asmatullah s/o Muhammad Khan and Waheed Rasul respondents were convicted under section 302(b)/109, P.P.C. and sentenced to rigorous imprisonment for life.
The convicted accused filed appeal in the High Court. By order dated 28‑9‑1998, the learned High Court suspended their sentence and released them on bail pending disposal of their appeal. Hence, this petition by Farhat Azeem complainant, son of Asmatullah deceased.
It is contended on behalf of the petitioner‑complainant that the facts and circumstances of the case did not justify grant of bail to the respondents, in that, they had remained absconding after the occurrence for a considerable period; the evidence led against them at the trial about the conspiracy had been believed by the learned trial Court and that the learned High Court erred in touching the merits of the case in suspending their sentence. Though precedents of this Court were cited before the learned High Court disapproving the grant of bail to the accused convicted on the capital charge but the same were neither, considered not followed.
The binding effect of the decisions of the Supreme Court was considered in the case of Syed Sajjad Hussain v. Secretary, Establishment Division,. Cabinet Secretary, Islamabad and 2 others (1996 SCMR 284) and it was held that the law declared by the Supreme Court would bind all the Courts, Tribunals and also the bureaucratic set‑up in Pakistan. Ataur Rehman v. The State (PLD 1967 SC 23) is also to the same effect.
In, the Province of the Punjab through Secretary, Health Department v. Dr. S. Muhammad Zafar Bukhari PLD 1997 SC 351 this Court had observed that the law declared by Supreme Court by virtue of Article 189 of the Constitution of Islamic Republic of Pakistan, 1973, is binding on all the Courts and authorities in Pakistan, and the judgment passed by the High Court, contrary to the dictum laid down by the Supreme .Court would be a judgment per incuriam, and that one cannot be found guilty of disobedience of such an order and cannot be got implemented by invoking power of contempt of the Court.
Ashiq Hussain alias Muhammad Ashrat v. The State PLD 1994 SC 879 also emphasises the binding. nature of the decision of the Supreme Court and strongly deprecates the tendency on the part of the Courts to ignore judgments of the superior Courts when cited before them. The relevant observations are to .the following effect:‑‑
"Before parting with the judgment we propose to remind all other Courts in Pakistan that under Article 189 of the Constitution of the Islamic Republic of Pakistan, decision of the Supreme Court enunciating principles of law is binding on them. By our experience we have noted tendency .on the part of Magistrates/Assistant Commissioners/ Additional District Judges/District Judges to ignore the judgments of the superior Courts when cited before them. They would not even read the citation and would give the impression as if the law laid down by the Supreme Court/High Courts is not meant for them. They often tell the Advocates to produce the law books before the superior Court as and when the matter reaches there. This treatment of the judgments of the superior Courts and attitude of the Presiding Officers is contemptuous, contumacious and also amounts to misconduct. By this judgment we intend to strike a note of warning to the subordinate Courts in the country that they are legally bound to follow the principles of law enunciated by the Supreme Court and if they do not follow it then serious view of the matter can be taken against the delinquent as and when the misconduct comes or is brought to the notice of this Court."
Sakhi Muhammad and another v, Capital Development Authority Islamabad PLD 1991 SC 777 also enunciates the above proposition wherein it was observed that all Courts subordinate to the Supreme Court and all executive and quasi judicial authorities are obliged by virtue of the Constitution to apple the rule laid down by the Supreme Court in the cases coming up before them for decision:
"The decision of Supreme Court, in so far it decides a question of law or is based upon or enunciates a principle of law is binding on all Courts in Pakistan. The decisions on questions of laws or enunciation of principles of law are the generalization of such questions and principles. There can be no generalization of the facts and circumstances of any case. The facts and circumstances of each case are peculiar to that case and, therefore, provide no guidance in the other cases. On the other hand, the generalized principles of law or generalized enunciation of principles of law govern all those which fall within such generalization."
We do not think that there is hardly a need for reiteration that the Supreme Court is the highest judicial forum in the country, it has to interpret the law while hearing appeals from the judgments of the High Court and the subordinate judiciary. Invariably such matters are considered by more than one Judges having long experience and thrash out the proposition brought before them in the light of the chain of judgments rendered on the controversy in issue and ensure that continuity of law is maintained as it is essential for good judicial administration.
The subordinate judiciary should always give its utmost respect, regard and consideration to the judgments, decrees, directions and orders of the Supreme Court, for, it is necessary apart from the binding nature of the same for maintaining discipline in all ranks of the judiciary. When the Supreme Court itself gives due consideration to the earlier decisions rendered by it we wonder why the subordinate judiciary in Pakistan should turn a deaf ear to the judgments, awards, findings or observations of the Supreme Court. The Courts and authorities subordinate to the Supreme Court are under legal obligation to follow the law laid down by it, and if they consider that the case‑law cited before them is not relevant or applicable to the facts and circumstances of the case they are dealing with, then they should distinguish it with reasons showing application of mind by them. This exercise would. enable the party citing the case‑law to understand as to why the precedents relied upon by it were not followed.
The discretion has to be exercised judicially by considering the relevant facts Without commenting on the merit of the case. If the contention raised requires consideration of the merits, the Appellate Court would refrain from entertaining such contentions. The Court cannot enter into a re‑appraisal of the evidence which should be considered at the time of hearing of the appeal. But, where on perusal of the facts and judgment impugned, the Court comes to the conclusion that the judgment suffers from any legal error, it would be Justified to suspend the sentence and grant the bail. In this regard the reasonable and legal views expressed by the trial Court should be given due consideration and weight, but every effort should be made to ensure that neither the evidence is reappraised nor the merits of the case are discussed. Muhammad Ashraf v. The State 1971 SCMR 183, Noor Abdullah and another v. The State 1981 SCMR 859 and Jamshed Azam v. The State 1990 SCMR 1393 also enunciate the above legal principle.
Muhammad Nawaz v. Muhammad Nawaz alias Naji and 4 others 1997 SCMR 1521 is another judgment on the point of suspension of sentence, and it was observed in this case that the accused‑respondents having been convicted and sentenced on the charge of murder, High Court had no justification in law to suspend their sentences in the peculiar circumstances of the said case.
It is a settled proposition of law that while deciding the bail matter the Court has to refrain from making such observations, which may prejudice the case of either party.'
Sentence awarded by the trial Court should not ordinarily be suspended by the Appellate Court unless strong grounds are made out to appear that conviction under the offence in question or any other allied offence is not liable to be sustained, but it should not be taken as a total prohibition on the power of the Appellate Court to suspend the sentence and in suitable cases it may exercise the power on the basis of the principles laid down in proviso to subsection (1) to section 497, Cr.P.C. as held by this Court in Maqsood v. Ali Muhammad and another 1971 SCMR 657. It was further observed in the said case that "it is now well‑settled that where a statute itself lays down certain principles for doing some acts they may be taken as a guideline for doing something of the same nature which is in the discretion of the Court".
N.H.Q./F‑63/S Bail cancelled.
P L D 2000 Supreme Court 26
Present: Saiduzzaman Siddiqui, C.J., Irshad Hasan Khan, Raja Afrasiab Khan, Muhammad Bashir Jehangiri, Nasir Aslam Zahid, Munawar Ahmed Mirza and Ch. Muhammad Arif, JJ
FEDERATION OF PAKISTAN and others‑‑‑Appellants
versus
M. NAWAZ KHOKHAR and others‑‑‑Respondents
Civil Appeals No.200 to 210, 781 to 788 of 1999, decided on 8th November 1999.
(On appeal from the judgment of Lahore High Court dated 26‑3‑1998 passed in Writ Petitions Nos. 112, 12908; 1291.0, 14037, 14134 of 1997, 24182 of 1996, Cr.M. No.41‑H of 1997, Writ Petition No.4544, 4590, 4593, 4594 of 1998 in C.As Nos. 200 to 210 of 1999, respectively and Writ Petitions Nos.6663 of 1998, 4590, 4593, 4594, 4471 of 1998, 14518, 14509 and 14519 of 1997 in C.As. Nos. 781 to 788 of 1999 respectively).
(a) Ehtesab‑‑‑
‑‑‑‑Holder of public offices‑‑‑Transparent, even‑handed and above board accountability of holders of all public offices, is the essence of Islamic polity and a democratic set‑up‑‑‑Presence of accountability process in a system of governance‑ not only deter those who hold sway over the populace, from misusing and abusing the power and authority entrusted to them but also ensures principles of governance.
(b) Ehtesab‑‑
‑‑‑‑Legislative history of accountability laws in Pakistan stated.
(c) Ehtesab Ordinance (CXI of 1996)‑‑‑
‑‑‑‑Preamble‑‑‑Constitution of Pakistan (1973), Art.89(2)‑‑‑Ehtesab Ordinance. 1996, promulgated on 18‑11‑1996, was a temporary piece of legislation which would have expired in terms .of Art‑89(2) of the Constitution‑ on 17‑3‑1997.
Sabir Shah v. Shad Muhammad Khan PLD 1995 SC 66; Secretary. Home Department v. Zia Ullah Khan and others 1992 SCMR 602 and Muhammad Arif v. State 1993 SCMR 1589 fol.
(d) Ehtesab Ordinance (XX of 1997)‑‑‑
‑‑‑‑Preamble‑‑‑Constitution of Pakistan (,1973), Art.89‑‑‑Vires of Ehtesab Ordinance (XX of 1997)‑‑‑Power of the President to promulgate Ordinance‑‑Essential conditions mentioned in Art.89 of the Constitution being present at the time of promulgation of Ehtesab Ordinance (XX of 1997), no exception could be taken to the promulgation of said Ordinance ‑‑‑Ehtesab Ordinance (XX of 1997), therefore, was a valid piece of legislation and having been promulgated on 1‑2‑1997 remained operative until 31‑5‑1997.
Ehtesab Ordinance CXI of 1996 promulgated on 18‑11‑1996 was no doubt enforced on 1‑2‑1997, when Estesab Ordinance (XX of 1997) was promulgated. However, Ordinance (CXI of 1996) was thrice amended between the period from 31‑12‑1996 to 27‑1‑1997 before it was repealed and replaced by Ordinance XX of 1997. On 1‑2‑1997, when Ordinance XX of 1997 was promulgated the National Assembly stood dissolved and general elections in the country were called on 3‑2‑1997 and therefore, it would have taken some time for the National Assembly to come into existence. In these circumstances, the promulgation of Ordinance XX of 1997 to repeal and replace Ordinance CXI of 1996 as amended by Ordinance CXXIII of 1996, Ordinance VII of 1997 and Ordinance XI of 1997, could not be described as arbitrary or improper exercise of power vested in the President under Article 89 of the Constitution. The essential conditions mentioned in Article 89 of the Constitution for exercise of Ordinance Making Power by the President being present at the time of promulgation of Ordinance XX of 1997, no exception could be taken to the promulgation of Ordinance XX of 1997. Ordinance XX of 1997 was a valid piece of legislation. The said Ordinance having been promulgated on 1‑2‑1997, remained operative until 31‑5‑1997.
(e) Ehtesab Ordinance (CXI of 1996)‑‑‑
‑‑‑‑Preamble‑‑‑Ehtesab Ordinance (XX of 1997), Preamble & S.28‑‑‑Ehtesab Act (IX of 1997), Preamble‑‑‑Constitution of Pakistan (1973), Arts. 89 & 264‑‑General Clauses Act (X of 1897), Ss. 6 & 24‑‑‑Repeal of an Ordinance/Act‑‑Consequences flowing from repeal‑‑‑Principles‑‑‑"Simple repeal" and "simultaneous repeal and re‑enactment" of a legislation‑‑‑Impact‑‑‑Continuity of the Ordinance ‑‑‑Principles‑‑‑Ordinance (CXI of 1996) was still in force when same was repealed by Ordinance (XX of 1997) which was a verbatim reproduction of Ordinance (CXI of 1996) and Ordinance (XX of 1997), was finally converted into a permanent legislation when the Legislature passed Ehtesab Act, 1997‑‑‑Effect‑‑‑Although Ordinance (CXI of 1996) was a temporary legislation but the Legislature intended to provide continuity to its provisions by first repealing same by Ordinance (XX of 1997) and then converting the latter into an Act of Legislature by passing same as Act (IX of 1997)‑‑‑Clear intention, therefore, was present on the part of the Legislature while promulgating Ordinance (XX of 1997) to provide continuity to the provisions of Ordinance (CXI of 1996)‑‑‑Provision of S.28 (Repealed clause) of Ordinance (XX of 1997) though had not specifically saved the proceedings instituted under Ordinance (CXl of 1996), there was clear intention on the part of the Legislature to keep the proceedings instituted under Ordinance (CXI of 1996) alive under Ordinance (XX of 1997)‑‑‑Proceedings initiated under Ordinance (CXI of 1996), therefore, could be continued under Ordinance (XX of 1997) after repeal of Ordinance (CXI of 1996).
If an Ordinance stands repealed under the Constitution, the consequences of repeal are provided under Article 264 of the Constitution. However, if a law is repealed by a subsequent Act, the consequences flowing from such repeal are to be determined with reference to the provisions of section 6 of General Clauses Act. In the present case the contention was that Ordinance XX of 1997 while repealing Ordinance CXI of 1996, though contained a saving clause, did not provide for continuation of the proceedings pending under Ordinance CXI of 1996, which showed that the legislature did not intend to keep the pending proceedings alive under Ordinance XX of 1997. Repeal of Ordinance CXI of 1996, by Ordinance XX of 1997 was not a case of simple repeal .but it was a case of simultaneous repeal and re‑enactment of a legislation, and therefore, besides consequences mentioned in section 6 of the General Clauses Act, section 24 of the General Clauses Act were also attracted. Ordinance XX of 1997 was a verbatim reproduction of Ordinance CXI of 1996. Ordinance CXI of 1996 was still enforced when it was repealed by Ordinance XX of 1997 Ordinance XX of 1997 was finally converted into a permanent legislation when the Legislature passed it as Act IX of 1997. It is, therefore, quite clear that though Ordinance CXI of 1996 was a temporary legislation but the Legislature intended to provide continuity to its provisions by first repealing it by Ordinance XX and then converting the later into an Act of Legislature by passing it as Act IX of 1997.
There was a clear intention on the part of the Legislature while promulgating Ordinance XX of 1997 to provide continuity to the provisions of Ordinance CX1 of 1996. Therefore, in spite of the fact that section 28 of the Ordinance XX of 1997 did not specifically save the proceedings instituted under Ordinance CXI of 1996 there was clear intention on the part of the Legislature to keep the proceedings instituted under Ordinance CXI of 1996 alive under Ordinance XX of 1997. The proceedings initiated under Ordinance CXI of 1996 could be continued under Ordinance XX of 1997 after repeal of Ordinance CXl of 1996.
Craies on Statute Law, 7th Edn‑, pp.408‑409 quoted.
(f) Ehtesab Act (IX of 1997)‑‑‑
‑‑‑‑Ss. 1 & 31‑‑‑Ehtesab Ordinance (XX of 1997), Preamble‑‑‑Constitution of Pakistan (1973), Art.89‑‑‑Provisions of Ehtesab Act, 1997 applied to the holders of public offices since 6th of November, 1990‑‑‑Proceedings pending under Ehtesab Ordinance, 1997 (repealed by the said Act) in respect of holders of public offices for the period prior to 6th November, 1990 could not be continued under Ehtesab Act, 1997.
Provisions of Ehtesab Act, 1997 make it clear that the provisions of the Act applied to the holders of public offices since 6th day of November, 1990. As section 31 of the said Act provides that proceedings pending under Ordinance XX of 1997 shall continue under the Ehtesab Act; 1997 it necessarily implies that such proceedings could be continued only in accordance with the provisions of the Ehtesab Act, 1997. Since the provisions of the Act applied to the holders of public offices since 6th November, 1990 the proceedings pending under Ordinance XX of 1997 in respect of holders of public offices for the period prior to 6th of November, 1990 could not be continued under the Act. Therefore. only those proceedings which were pending under Ordinance XX of 1997 on the date of promulgation of the Act, were saved and continued which related to offences as defined under the Ehtesab Act, 1997 by the holders of public offices since 6th day of November, 1990.
Ehtesab Act was amended by Ordinance II of 1998, which was never passed by the Parliament and as such on expiry of four months period it stood repealed in terms of Article 89(2)(a) of the Constitution. Accordingly amendments made in the Act through Ordinance II of 1998 consequently became ineffective and the old provisions stood revised.
Ordinance II of 1998 was promulgated on 4‑2‑1998. Ordinance II of 1998 was not passed by Majlis‑e‑Shoora. Under Article 89 of the Constitution, this Ordinance stood repealed on 3‑6‑1998. An Ordinance promulgated under Article 89 of the Constitution is a temporary legislation, therefore, the amendments made in the Act by Ordinance II of 1998 stood obliterated and original provisions in the Act stood revised on repeal of Ordinance II of 1998.
After the promulgation of the Ehtesab Act, 1997 only holders of public offices, since 6th day of November, 1990 could be prosecuted and proceedings which related to offences committed prior to 6th day of November, 1990 could not be continued under the Ehtesab Act, 1997 after repeal of Ordinance XX of 1997.
(g) Ehtesab Act (IX of 1997)‑‑‑
‑‑‑S. 1(2)‑‑‑Constitution of Pakistan (1973), Art.25‑‑‑Equality of citizens‑‑Reasonable classification‑‑‑Classification of holders of public offices since 6th day of November, 1990 into one class was neither unreasonable nor could be said that same had no nexus with the object of the Ehtesab Act, 1997‑‑Provisions of Ehtesab Act, 1997 therefore, were not discriminatory.
Per Muhammad Bashir Jehangiri, .J., Contra‑‑
State of West Bengal v. Anwar Ali Sarkar and another AIR 1952 SC 75; East and West Steamship Co. v. Pakistan PLD 1958 SC (Pak.) 41 and The Pakistan Barbers' Association (Regd.), Lahore v. Province of Punjab through Directorate of Labour Welfare, Punjab, Lahore and another PLD 1976 Lah. 769 ref, (h) Ehtesab Act (IX of 1997)‑‑
‑‑‑‑Preamble‑‑‑Provisions of Ehtesab Act are not opposed to the Injunction of Islam‑‑‑Accountability of holders of public offices is an essence of Islamic Polity.
The provisions of the Ehtesab Act, 1997 are not opposed to the Injunctions of Islam. Accountability of the holders of public offices is an essence of the Islamic Polity. Under Islamic System of Governance, the holders of public offices are the trustees of the confidence reposed in them by the people and they, are fully accountable for acts performed by them in discharge of their functions as holders of such public offices. There is no Verse in the Holy Qur'an or Sunnah of Holy Prophet (peace be upon him) which was opposed to the concept of accountability of holders of public offices. On the contrary, the holders of public offices under Islamic System of Governance, are fully accountable for their acts being trustees of the people who elect them as their representatives.
Tanvir Bashir Ansari, Deputy Attorney‑General with Ch. Akhtar Ali, Advocate‑on‑Record for Appellants (in C.As. Nos.200 to 210 of 1999).
Raja Muhammad Akram, Senior Advocate Supreme Court and Mehr Khan Malik, Advocate‑on‑Record for Respondent (in C.A. No.200 of 1999).
Nemo for Respondents (in C.As. Nos. 201, 203, 204, 206 and 207 of 1999).
Respondent in person (in C.A. No.205 of 1999).
Khawaja Haris Ahmed, Advocate Supreme Court and Mehr Khan Malik, Advocate‑on‑Record for Respondent (in C.A. No.202 of 1999).
Ch. Mushtaq Ahmad Khan, Senior Advocate Supreme Court and Mehr Khan Malik, Advocate‑on‑Record for Respondents (in C.As. Nos. 208 to 210 of 1999).
Ch. Mushtaq Ahmad Khan, Senior Advocate Supreme Court for Appellants in C.As. Nos. 781 to 788 of 1999).
Tanvir Bashir Ansari, Deputy Attorney‑General and Ch. Akhtar Ali, Advocate‑on‑Record for Respondents Nos.l to 3 (in C.As. Nos.781 to 784 of 1999) for 1, 2 and 4 (in C.As. Nos.785 and 1 and 2 in C.As. Nos. 786 to 788 of 1999).
Ch. M. Bashir, Assistant Advocate‑General, Punjab and M. Yousaf Rao, Advocate‑on‑Record for Respondents Nos.4 to 6 (in C.As. Nos.782 and 783 of 1999).
Date of hearing: 15th October, 1999.
JUDGMENT
SAIDUZZAMAN SIDDIQUI, C.J.‑‑This judgment will govern the disposal of Civil Appeals Nos.200 to 210 of 1999 and 781 to 788 of 1999, besides deciding the legal questions arising in Criminal Appeals Nos. 109, 111, 194, 203, 205, 217, 218, 247 and 260 of 1997; 255, 276, 279, 280, 282, 299 and 306 of 1998 and 79 of 1999.
Civil Appeals Nos. 22 to 210 and 782 to 784 of 1999 arise from the judgment of a Full Bench of Lahore High Court consisting of five learned Judges of that Court, dated 26‑3‑1998, disposing of number of writ petitions filed under Article 199 of the Constitution of Islamic Republic of Pakistan, 1973 (hereinafter to be referred as 'the Constitution') to challenge the constitutionality and vires of Ehtesab Act (IX of 1997) (hereinafter to be referred as 'the Act'), and the preceding Ehtesab Ordinances promulgated during the years 1996 and 1997. Civil Appeals .Nos. 781 and 785 to 788 of 1999 arise from judgments delivered by different Benches of Lahore High Court on different dates disposing of several writ petitions, filed under Article 199 of the Constitution to question the validity of the Act and the preceding Ehtesab Ordinances, in terms of the judgment of Full Bench of the Lahore High Court, dated 26‑3‑1998.
We have heard Ch. Mushtaq Ahmed Khan, Senior Advocate Supreme Court for appellants in Civil Appeals Nos.781 to 788 of 1999 and for respondents in Civil Appeals Nos. 208 and 210 of 1999; Ch. Aitizaz Ahsan, Advocate Supreme Court, for appellants in Criminal Appeals Nos. 109, 203, 247 of 1997 and 255 of 1998; Mr. Fakharuddin G. Ebrahim, Senior Advocate Supreme Court for appellants in Criminal Appeals Nos. 194, 217 of 1997 and 276 of 1998; Mr. Abdur Rahim Kazi, Advocate Supreme Court for appellants in Criminal Appeals Nos. 218 of 1997, 205 of 1997, 260 of 1997, 306 of 1998 and 79 of 1999; Mr. Azizullah K. Shaikh, Advocate Supreme Court for appellants in Criminal Appeals Nos. 279 and 280 of 1998; Mr.Salim Dil Khan, Advocate Supreme Court for appellants in Criminal Appeal No.282 of 1998; Mr. Raja Abdul Ghafoor, Advocate‑on‑Record in Criminal Appeal No. 111 of 1997; Mr. K.M.A. Samdani, Senior Advocate .Supreme Court for appellant in Criminal Appeal No.299 of 1998; Mr. Raja M. Akram, Senior Advocate Supreme Court for respondents in Civil Appeal No.200 of 1999; Mr. Tanvir Bashir Ansari, Deputy Attorney‑General for appellants in Civil Appeals Nos.200 to 210 of 1999 and respondents in Civil Appeals Nos.781 to 788 of 1999, Ch. Bashir Ahmed, Assistant Advocate‑General, Punjab for respondents in Civil Appeals Nos. 782 and 783 of 1999.
The following common contentions have been raised by the learned counsel for the private appellants in support of their respective appeals and while opposing the appeals filed by the Federation:
(i) That Ehtesab Ordinance CX1 of 1996 (hereinafter to be referred as 'the Ordinance CX1') as amended, by Ehtesab (Amendment) Ordinance CXXIII of 1996 (hereinafter to be referred as 'Ordinance CXXIII') Ehtesab (Amendment) Ordinance VII of 1997 (hereinafter to be referred as 'Ordinance VII') and Ehtesab (Second Amendment) Ordinance XI of 1997 (hereinafter to be referred as 'Ordinance XI') was repealed by Ehtesab Ordinance XX of 1997 (hereinafter to be referred as 'Ordinance XX') but the repealing Ordinance XX did not save the proceedings pending under the Ordinance CXI. Therefore, the pending proceedings could not be continued. after repeal of Ordinance CXI. .
(ii) That Ordinance XX of 1997 was an invalid piece of legislation as on the date the President promulgated this Ordinance, the conditions precedent for exercise of power under Article 89 of the Constitution were nonexistent, Ordinance XX being a verbatim of Ordinance CXI and later mentioned Ordinance being still enforced, there was no legal necessity for promulgation of Ordinance XX.
(iii) That Ordinance XX being an invalid law, the proceedings pending under it on the date of promulgation of the Act, could not be saved in spite of a saving clause in the Act. The pending proceedings under Ordinance XX even otherwise, could not be saved under the Act as the provisions in the Act regarding cut off date of offences triable under the Act was different from the one stated in Ordinance XX.
(iv) That provisions of section 31(c) of the Act are. invalid being discriminatory in nature inasmuch as under the Act only those offences could be tried which were committed after 6‑11‑1990 whereas under section 31(c) the purported effect was to keep the proceedings alive which related to the offences committed prior to 6‑11‑1990.
(v) That provisions of the Act have been applied in a discriminatory manner as only persons belonging to one political party were targeted under it.
(vi) That the provisions of the Act were proposed to the Injunctions of Islam, and therefore, are liable to be struck down.
(vii) That Ordinance II of 1998 which amended the Act lapsed after 4 months of its promulgation as it was not passed by the Parliament and on its repeal under the Constitution the amendments made in the Act also ceased to be operative.
(viii)That Ordinance CXI being a temporary legislation, the proceedings pending under it on the date of repeal could not be saved in the absence of a specific saving clause in the repealing Ordinance.
(ix) That savings contemplated under Article 264 of the Constitution on the repeal of law did not extend to the proceedings pending under a temporary legislation.
In reply to the above submissions of the learned counsel for private appellants and in support of the appeals filed by the Federation, Mr. Tanvir Bashir Ansari, the learned Dy.A.‑G., raised the following contentions:‑‑
(i) That the Ordinance promulgated by the President under Article 89 of the Constitution, cannot be treated as a temporary legislation only .for the reason that the Ordinance is likely to lapse on expiry of 4 months period if it is not presented before the Parliament. It is contended that whether a legislation is temporary in nature is to be decided with reference to the subject covered by it and the nature of the legislation.
(ii) That in case the Ordinance is repealed under the Constitution, the consequences of repeal follow as provided in Article 264 of the Constitution while in case of repeal by a subsequent Act or legislation, the consequences of repeal are governed by the provision of General Clauses Act of 1897.
(iii) That Ordinance CXI was repealed by Ordinance XX of 1997 and therefore, the effect of its repeal was governed by section 6(c) of General Clauses ‑Act, which provided that proceedings pending on the date of repeal were to continue under the repealed legislation; and
(iv) That Ordinance XX remained in the field until it was repealed by the Act, section 31 of the Act clearly provided for saving of proceedings under Ordinance‑ XX, therefore, the proceedings initiated under Ordinance CXI which were saved under Ordinance XX continued under the act by virtue of the saving clause in the Act.
Number of reported decisions from Pakistani and Indian Courts, were cited at the bar by the learned counsel in support of their respective contentions. We will refer to only those cited cases which are relevant for the decision of controversies raised before us.
Before we proceed to consider the above contentions of the learned counsel for the patties, it may be stated here that transparent, even‑handed and across the board accountability of holders of all public offices, is the essence of Islamic polity and a democratic set‑up. Presence of accountability process in a system of governance not only deter those who hold sway over the populace from misusing and abusing the power and authority entrusted to them but it also ensures principles of good governance. It would be pertinent at this stage to briefly refer to the legislative history of accountability laws in Pakistan.
Soon after the establishment of State of' Pakistan, Public and Representative Offices (Disqualification) Act, 1949 (PRODA) was passed by the Legislature which became effective from 15th August, 1947. This Act provided for debarring from public life for a suitable period of persons judicially found guilty of misconduct in any public office. It remained enforced until 21st September, 1954 when it was repealed by Public and Representative Offices (Disqualification) (Repeal) Act, 1954. After the repeal of PRODA, there was no special law on the statute book dealing with the accountability of holders of public offices between the period from 21st September, 1954 to 6th August, 1959. On 7th August, 1958 while the country was under the Martial Law, Elective Bodies (Disqualification) Order, 1959 (President's Order No.13 of 1959) (EBDO) was promulgated which remained enforced only until 31st December, 1960 (EBDO provided for disqualifications of certain categories of persons from being a member or a candidate for the membership of any elective body until 31st December, 1966. EBDO was amended by P.O. No.7 of 1960 dated 10‑2‑1960; P. O. 9 of 1960 dated 5‑3‑1960; P.O. 27 of 1960 dated 28‑11‑1960 and P.O. 29 of 1960 dated 27‑11‑1960. On 7th January, 1963, Elective Bodies Disqualification (Removal and Remission) Ordinance, 1963 was promulgated which authorised the President to reduce the period of disqualification of a person disqualified under EBDO. Once again, after expiry of EBDO on 31st December, 1960, no special law existed on the subject of accountability of holders of public offices until 8th of January, 1977. On 9th January, 1977, Holders of Representative Offices (Prevention of Misconduct) Act IV of 1976 and Parliament and Provincial Assemblies (Disqualification from Membership) Act V of 1976 were passed which provided for trial of offences of misconduct of holders of public offices before a Bench of the High Court consisting of not less than two Judges. On 13th November, 1977 Holders of Representative Offices (Punishment for Misconduct) Order (President's Post Proclamation) Order No.16 of 1977 (P.P.P.0.16) and Parliament and Provincial Assemblies (Disqualification for Membership) Order (President's Post Proclamation Order 17 of 1977 (P.P.P.O. 17) were promulgated. P.P.P.Os. 16 and 17 of 1977, however, did not repeal Holders of Representative Offices (Prevention of Misconduct) Act, 1976 and Parliament and Provincial Assemblies (Disqualification for Membership) Act, 1976 with the result from 13‑11‑1977 onwards we had on the Statute Books Act IV of 1976, Act V of 1976, P.P.P.0.16 of 1977 and P.P.P.O. 17 of 1977, all dealing with punishment for misconduct and disqualification of the holders of public offices. Holders o Representative Offices (Prevention of Misconduct) Act, 1976 and Parliament and Provincial Assemblies (Disqualification for Membership) Act, 1976 were finally repealed by Parliament and Provincial Assemblies (Disqualification for Membership) (Amendment) Act, 1991 which was assented to by the President on 28‑4‑1991. P,P,P.O. 16 of 1977 was amended through P.P.P.O. 5 of 1978 dated 17‑1‑1978 and President's Order I of 1981. Similarly, P,P.P.O. 17 was also amended by Ordinance IX of 1990 dated 15‑10‑199() and Act V11 of 1991 dated 28‑4‑1991.
On 18th November, 1996, Ehtesab Ordinance CXI of 1996 was promulgated which repealed P.P.P.O. 16 and P.P.P.O. 17 of 1977. Ordinance CXI was amended by Ordinance CXXIII of 1996, Ordinance V11 of 1997 and Ordinance XI of 1997. Ordinance CXI amended as aforesaid was repealed and replaced by Ordinance XX of 1997. Ordinance XX was repealed by Act IX of 1997. Act IX of 1997 was amended through Ordinance II of 1998 on 4th February, 1998 but this Ordinance stood repealed on 3rd June, 1998 as it was not passed by the Parliament.
From the legislative history mentioned above, two conclusions clearly emerge. Firstly, the necessary for special legislation relating to accountability of holders of public offices has been recognised both by the Civilian as well as Military Governments. Secondly, except for two brief interludes, the special laws relating to accountability of holders of public offices remained in the field from 15th August, 1947 till today.
At this stage, we may also mention that at least on two previous occasions, the justification for imposition of Martial Law and deviation from the Constitutional Rule in the country was sought to be justified on the plane of rampant corruption of the politicians. It is also not without significance that four previous elected Civilian Governments were also dismissed before completion of their tenure under the Constitution on allegations of corruption besides other allegations. In this backdrop, when the second Benazir Bhutto's elected Government was dismissed under Article 58(2)(b) of the Constitution in November, 1996, there was a public outcry for a severe accountability of the holders of public offices. The caretaker set‑up which carne into existence as a result of dismissal of elected Government of Benazir Bhutto, therefore. promulgated Elttesab Ordinance CXI of 1996, which was later amended through Ordinance CXXIII, Ordinance VII and Ordinance XI, before it was repealed and replaced by Ordinance XX of 1997. Nawaz Sharif's Government which came into power as a result of general elections in the country held in February, 1997. promulgated the Act which repealed Ordinance XX of 1997. In the light of the preceding discussion, we now. proceed to consider the above contentions of the parties.
The first contention of the learned counsel for the private appellants in the above cases is, that Ordinance CXI being a temporary legislation, the proceedings initiated thereunder could not survive on its repeal. In support of the contention that Ordinance CXI was a temporary Legislation, reliance is placed on Article 89 of the Constitution which provides that an Ordinance promulgated by the President shall be laid before the National Assembly if it contains provisions dealing with all or any of the matters specified in clause (2) of Article 73 and shall stand repealed at the expiration of four months from its promulgation or on passing of a resolution disapproving it if passed before expiry of four months.
The learned Deputy Attorney‑General, on the other hand, contended that merely because Article 89 of the Constitution provided that an Ordinance promulgated by the President shall stand repealed on expiration of the period of four months from the date of its promulgation, would not make the legislation temporary. A legislation is temporary in nature or not, according to learned Deputy Attorney‑General, is determined with reference to the subject‑matter of Legislation, the nature of provision contained therein and intention of the Legislature. The scope of Article 89 of the Constitution was considered by one of us (Saiduzzaman Siddiqui, 1., as he then was) in the case of Sabir Shah v. Shad Muhammad Khan PLD 1995 SC 66 as follows:‑‑
"From a careful examination of Article 89 (ibid), it is quite clear that the legislative power conferred by this Article on the President to promulgate Ordinance is circumscribed by these conditions. Firstly, at the time the Ordinance is promulgated by the President, the National Assembly must not be m session and circumstances exist which render it necessary to take immediate action for promulgation of the Ordinance. The Ordinance so promulgated by the President is only a stop‑gap arrangement and a temporary measure, as this Ordinance has to be placed before the National Assembly if it pertains to matters specified in Article 73(2) of the Constitution and in all other cases before the Parliament, within 4 months of the date of its promulgation, unless it is earlier withdrawn by the President , or disapproved by the National Assembly or Parliament as the case may be. It is, therefore, quite clear that the power to promulgate an Ordinance by the President under Article 89 of the Constitution of 1973 is designed to meet a situation when the legislation is required urgently and the Assembly is either not in session or is unable to function for reasons of having been dissolved in accordance with the provisions of the Constitution of 1973. But the Ordinance so promulgated by the President does not acquire the status of a permanent Act of Parliament as it loses its validly on expiry of 4 months period from the date of its promulgation if the National Assembly or Parliament as the case may be, does not approve the legislative measure within that period. In the case of Sargodha, Bhera Bus Service Limited and others v. Province of West Pakistan etc. PLD 1959 SC 127, this Court examined the effect of repeal of Ordinance XXXV of 1956 promulgated by the Governor of West Pakistan in exercise of his power conferred under Article 102 of the Constitution of 1956. In that case, the Government of West Pakistan used to realise taxes from the transport companies up to 17‑12‑1956 in the Province of Punjab in accordance with the provisions of the Punjab Motor Vehicles Taxation Act, 1924 (IV of 1924). After creation of One Unit, the Government of West Pakistan promulgated Ordinance XXXV of 1956 in exercise of its power conferred under Article 102 (ibid) which came into effect on 1‑10‑1956. This Ordinance repealed the Punjab Motor Vehicles Taxation Act, 1924 and the Government started collection of taxes on the basis of the flat rate prescribed under the Ordinance. Ordinance XXXV of 1956 was laid before the Assembly on 8‑3‑1957 but before the Assembly could convert the Ordinance into an Act of Legislature it was suspended by the President under Article 193 of the Constitution of 1956. The Ordinance promulgated by the Governor was valid only for a period of 6 weeks under the provisions of Article 102 (ibid) and therefore, it ceased to be operative on 11‑3‑1957. The Legislative Assembly of West Pakistan passed Act XXXII of 1958 on 24‑4‑1958 incorporating the provision of Ordinance XXXV of 1956. It was contended before this Court on behalf of the petitioners in the above‑cited case. that as a result of repeal of Ordinance XXXV of 1956 which in turn had repealed Punjab Motor Vehicle Act, 1924 there was no law in the field between the dates the Ordinance XXXV of 1956 was repealed and Act XXXII of 1958 was passed, and as such the demand of recovery of taxes during the interregnum on the basis of the provision of repealed Punjab Motor Vehicles Act, 1924 was illegal. The contention was repelled by this Court as follows:‑‑
'We are unable to accept Mr, Brohi's argument, which carries with it the implication that during the interval of more than 13 months between the expiry of the Ordinance on the 11th of March. 1957 and the coming into force of Act XXXII of 1958 on the 24th of April, 1958, there was a blank in the statute book on the subject of imposition of tax on motor vehicles in West Pakistan, as according to Mr. Brohi, on the expiry of the Ordinance the old Taxation Act of 1924 was not revived. The general principle is that the duration of a statute passed by an authority empowered to pass permanent laws is prima facie perpetual unless it is intended to be temporary, and the Act of L924 was a permanent. Act. Now the question is whether it could be permanently repealed by an Ordinance made by the Governor? The Governor derived this power from Article 102 of the late Constitution, the relevant portions of which run thus:
(1) If at any time, except when the Provincial Assembly is in session, the Governor is satisfied that circumstances exist which render immediate action necessary, he may make and promulgate such Ordinance as the circumstances appear to him to require, and any. Ordinance so made shall have the like force of law as an Act of the Provincial Legislature; but the power of making Ordinances under this clause shall be subject to the like restrictions as the power of the Provincial Legislature to make laws, and any Ordinance made under this clause may be controlled or superseded by any such Act.
(2) An Ordinance promulgated under clause (i) shall be laid before the Provincial Assembly and shall cease to operate at the expiration of six weeks from the next meeting of the Assembly, or if a resolution disapproving it is passed by the Assembly, upon the passing of that resolution."
It follows from the language of this Article that the legislative power of the Governor was limited by the following conditions:
(1) that the Provincial Assembly was not in session, (2) that immediate action was necessary, (3) that the Ordinance was liable to be laid before the Provincial Assembly when it met next, and .
(4) that it was to cease to operate‑‑
(a) if a resolution disapproving it was passed and
(b) in any event at the expiration of the six weeks from the meeting of the Assembly.
The powers of Legislature of the Governor, therefore, were of a transitory, temporary and contingent nature. They are, no doubt, coextensive with those of the Provincial Assembly, as argued by Mr. Brohi, but this can be said only with regard to field of legislation as regards the Provincial list and the concurrent list of subjects as given in the Fifth Schedule to the late Constitution. But it is evident that the powers of the Assembly are more extensive. inasmuch as it was empowered to enact permanent Acts at all; times not subject to any limitation as the Governor's powers are meant to be by Article 102. which are to be exercised in emergency and with temporary effect only, and carry with them the implication that when a permanent Act is repealed by an Ordinance, the Act will revive on the expiry of the Ordinance. In these cases we are only concerned with the question of the entire repeal of permanent Act by an Ordinance and we are not called upon to decide the effect of mere amendment of any text of an Act. In the view that we have held, subsection (2) of section 4 of the West Pakistan General Clauses Act, 1956, as amended by West Pakistan General Clauses (Amendment) Act (III of 1957), which puts the effects of repeal of a permanent statute by an Act of the Provincial Legislature and by Ordinance on the same footing by extending the application of clause (a) of subsection (1) of section 4, is to that extent ultra vires. The Governor having no power of permanent legislation, the permanent repeal of a perpetual status by Ordinance is ultra vires, and the repealed Act revives as soon as an Ordinance 'ceases to operate', irrespective of the fact whether in the Ordinance the repeal was intended to he permanent or temporary."
Similarly, in the case of Government of Punjab through Secretary, Home Department v. Zia Ullah Khan etc. 1992 SCMR 602, this Court while considering the effect of repeal of Ordinance XIV of 1988 which amended subsection (2) of section I of the Special Court for Speedy Trials .Act and which stood repealed in terms of clause (2) of Article 89 of the Constitution of 1973, made the following observations:‑
"12. It may be stated that an Ordinance is a temporary legislation. It cannot be given permanency in the absence of any sound legal principle or backing of law. In this regard it may be advantageous to quote the following passage from the judgment of this Court in the case of Mahreen Zaibun Nisa v. Land Commissioner, Multan and others PLD 1975 SC 397:
It will be seen that this Article intended to make provision for emergency or temporary legislation at any time when the Provincial Assembly stands dissolved or is not in session, and it is for this reason that clause (2) of this Article, while conferring on an Ordinance promulgated by the Governor the same force and effect as an Act of the Provincial Legislature, contemplates that every such Ordinance shall be laid before the Provincial Assembly and shall cease to operate at the expiration of six weeks from re‑assembly thereof, or if before the expiration of that period a resolution disapproving it is passed by the Provincial Assembly, upon the passing of that resolution. The same clause also provides that the Ordinance may be withdrawn at any time by the Governor. An Ordinance is., therefore, essentially in the nature of a temporary legislation, and its future operation is made conditional on the approval of the Provincial Assembly. The provisions contained in the proviso to clause (4) could not, therefore, be intended to confer permanency on an Ordinance, in violation of the clear stipulation in clause (2) of the Article.
Apart from this basic objection, resting on the very 'nature of an Ordinance as a piece of temporary legislation, the proviso itself, as relied upon by the learned Attorney‑General, makes it clear that it has a narrow and limited purpose, namely, of meeting the requirement specified in the proviso to clause (2) of Article 143 of the Interim Constitution in relation to the enactment of Provincial laws on subjects included in the Concurrent Legislative List: As that proviso does not make a separate or special mention of the manner in which an Ordinance shall be promulgated in the Concurrent field, the proviso to clause (4) of Article 135 contains a special direction in this behalf to the effect that an Ordinance containing provisions inconsistent with an Act of the Federal Legislature or an existing law with regard to a matter enumerated in the Concurrent Legislative List shall be deemed to be an Act of the Provincial Legislature which has been reserved for the consideration of the President and assented to by him, provided the Ordinance is made by the Governor in pursuance of instructions from the President. Thus, the proviso in question merely seeks to apply to an Ordinance the special stipulation contained in a subsequent Article on the subject of legislation in a Concurrent, field, but does not have the effect of rendering the Ordinance promulgated by the Governor as a permanent Act of the Provincial Legislature, for all purposes. "
We may also refer to the following observations of the Privy Council in the case of Gooderham and Worts Ltd. v. Canadian 13roadcasting Corporation AIR 1949 PC 90, on the question of effect of expiry of a temporary amendment in an enactment:
In view of the above discussed legal position there is no doubt in my mind that on the repeal of Ordinance XXX of 1993, which was never placed before the Assembly for approval and which stood repealed on the expiry of 4 months period from the date of its promulgation in accordance with the provisions of Article 89 (ibid), the amendment introduced in section 8‑B by Ordinance XXX of 1993 stood removed from the statute book with the consequence the original provisions of section 8‑B of the Act stood revived on such repeal. Therefore, the original section 8‑B was enforced both at the time the two references were filed before the Election Commission and the present appeals were filed before this Court."
In view of the preceding discussion, we are of the view that Ordinance CXI promulgated on 18‑11‑1996, was a temporary piece of legislation which would have expired in' terms of Article 89 (2) of the Constitution on 17‑3‑1997.
The second contention of the learned counsel for the private appellants is that Ordinance XX which repealed and replaced Ordinance CXI was an invalid piece of legislation as on the date Ordinance XX was promulgated by the President, Ordinance CXI as amended, was enforced which was almost a verbatim of Ordinance XX, and therefore, conditions necessary for exercise of power by the President under Article 89 of the Constitution to promulgate the Ordinance, were non‑existent.
The contention of the learned counsel for the private applicants does not appear to be correct. Ordinance CXI of 1996 promulgated on 18‑11‑1996 was no doubt enforced on 1‑2‑1997, when Ordinance XX was promulgated. However, from the facts stated above, it is quite clear that Ordinance CXI was thrice amended between the period from 31‑12‑1996 to 27‑1‑1997 before it was repealed and replaced by the Ordinance XX. It‑is an admitted position that on 1‑12-1997, when Ordinance XX was promulgated the National Assembly stood dissolved and general elections in the country were called on 3‑2‑1997 and therefore, it would have taken some time for the National Assembly to come into existence. In these circumstances, the promulgation of Ordinance XX to repeal and replace Ordinance CXI as amended by Ordinance CXXII, Ordinance VII and Ordinance XI, could not be described as arbitrary or improper exercise of power vested in the President under Article 89 of the Constitution. The essential condition mentioned in Article 89 of the Constitution for exercise of Ordinance Making Power by the President being present at the time of promulgation of Ordinance XX, no exception could be taken to the promulgation of Ordinance XX. We are, accordingly of the view that Ordinance XX was a valid piece of legislation. The said Ordinance having been promulgated on 1‑2‑1997, remained operative until 31‑5‑1997.
The next contention of the learned counsel for the private appellants in the above cases is, that Ordinance XX having repealed and replaced Ordinance CXI, the proceedings pending on the date of repeal of Ordinance CXI, could not be saved and continued under Ordinance XX in the absence of a specific clause in the repealing Ordinances saving the proceedings pending under Ordinance, CXI. It is contended by the, learned counsel for the private appellants that section 28 of Ordinance XX which repealed Ordinance CXI, Ordinance VII and Ordinance XI, did not specifically save the proceedings which were pending under Ordinance CXI and therefore, all proceedings pending under Ordinance CXI came to an end with the repeal of Ordinance, CXI, and the same could not be continued or saved under Ordinance XX. In support of this contention, reliance is placed by the learned counsel on Government of Punjab v. Zia Ullah Khan 1992 SCMR 602 and Muhammad Arif v. State 1993 SCMR 1589.
Before considering the above contention, it may be stated here that if an Ordinance stands repealed under the Constitution, the consequences of repeal are provided under Article 264 of the Constitution. However, if a law is repealed by a subsequent Act, the consequences flowing from such repeal are to be determined with reference to the provisions of section 6 of General Clauses Act. The contention of the learned counsel for the private, appellant is, that Ordinance 'XX while repealing Ordinance CXI, though contained a saving clause, did not provide for continuation of the proceedings pending under Ordinance CXI, which shows that the Legislature did not intend to keep the pending proceedings alive under Ordinance XX. Repeal of Ordinance CXI, by Ordinance XX was not a case of simple repeal but it was a case of simultaneous repeal and re‑enactment of a legislation, and therefore, besides consequences mentioned in section 6 of the General Clauses Act, section 24 of the General Clauses Act were also attracted. Ordinance XX was a verbatim reproduction of Ordinance CXI. Ordinance CXI, was still enforced when it was repealed by Ordinance XX. It may also be mentioned here that Ordinance XX was finally converted into a permanent legislation when the Legislature passed it as Act IX of 1997. It is, therefore, quite clear to us that although Ordinance CXI, was a temporary .legislation but the Legislature intended to provide continuity to its provisions by first repealing it by Ordinance XX and then converting the later into an Act of Legislature by passing it as Act IX of 1997. Our above conclusions are supported by the, following passage in "Craies on Statute Law (Seventh Edition)" appearing at pages 408 and 409:‑‑
"If an Act' is in the first instance temporary, and is continued from time to time by subsequent Acts, it is considered as a statute passed in the 'session when it was first passed, and not as a statute passed in the session in which the Act which continues its operation was passed. This was‑so held in Shipman v. Hensbest, where (inter alia) it had been contended that 21 Jac. 1, 4, S.4 (common informers) which enabled a defendant, sued on any penal statute passed before 21 Jac. 1, to plead the general issue and to give special matter in evidence under it, did not apply to an action brought upon .l Jac., c.22, because that statute, although originally passed before 21 Jac. 1, was only a temporary Act to continue to the next session of the next Parliament, and that in the next Parliament ‑‑‑viz,, 6 Jac. 1‑‑it was not continued. nor was it continued again till after the passing of 21 Jac, 1, c.4. But as to this contention, Lord Kenyon said: ' It has been argued that the 21 Jac. 1, does not extend to Acts passed subsequent to it,' and that this may he considered as an action brought on a subsequent statute: the I . Jac. I . c.22, having expired before the 21 Jac. 1, and has been only re‑enacted since that time; but on this point I have not entertained a doubt from the beginning. We are almost clearly of opinion that this must be considered as an action on the 1 Jac. 1, c.22; and that the subsequent laws, which have continued it from time to time, all give effect to it as an Act made in the first year of James L' This doctrine seems not to have been accepted in R. v. Phipoe, where it was contended that an indictment founded on the temporary Act of 2 Geo. 2, c.25, S.3 (which Act was revived by 9 Geo. 2, c.18) ought to have concluded in the plural number, "against the form of the statutes in such case made and provided"; but it was held otherwise, because it was considered that the re‑enacting statute was the only statute in force against the offence. This ruling is, however, contrary to the opinion expressed by the Judges in Dingley v. Moor, where, on a similar point having been raised, it was said that, 'there ought to be a difference observed when a statute is made to endure for a certain time and is afterwards made perpetual by a new Act or made perpetual in part and where it is continued with a new addition; for where a statute is made perpetual in part or in whole without any new addition, the offence may well be supposed against the form of the first statute, for that Act is made to continue'."
In these circumstances, in our view, there was a clear intention on the part of the Legislature while promulgating Ordinance XX to provide continuity to the provisions of Ordinance CXI. Therefore, in spite of the fact that section 28 of the Ordinance XX did, not specifically save the proceedings instituted under Ordinance CXI there was clear intention on the part of the legislature to keep the proceedings instituted under Ordinance CXI alive under Ordinance XX. We are, accordingly, of the view that the proceedings initiated under Ordinance CXI could be continued under Ordinance XX after repeal of Ordinance CXI.
The next contention of the learned counsel for the private appellants is. that in spite of a saving clause in the Act, which provided that proceedings, pending under Ordinance XX were saved, the same could not be continued under the Act, as the provisions of the Act were inconsistent with the provisions of the Ordinance XX. The Act repealed Ordinance besides repealing P.P.P.O. 16 and P.P.P.O. 17 of 1997. Section 31 of Act IX of 1997 reads as follows:‑‑
"31. Repeal.‑‑‑(1) The Holders of Representative Offices (Punishment for Misconduct) Order, 1977 (P.P.P.O. 16 of 1977) the Parliament and Provincial Assemblies (Disqualification for Membership) Order, 1977 (P. P. P.O. 17 of 1977), and the Ehtesab Ordinance, 1997 (XX of 1997), are hereby repealed.
(2) Notwithstanding the repeal of the Holders of Representative Office` (Punishment for Misconduct) Order, 1977 (P.P.P.O. 16 of 1977), the Parliament and Provincial Assemblies (Disqualification for Membership) Order, 1977 (P.P.P.O. 17 of 1977) and the Ehtesah Ordinance, 1997 (XX of 1997), ‑‑
(a) any proceedings pending before the Special Court under the said Orders shall continue as if the said Orders had not been repealed;
(b) any appointments made under the Ehtesab Ordinance. 1997 (XX of 1997), including specifically that of the Chief Ehtesab Commissioner by the President shall continue for the appointed terms; and
(c) any proceedings pending before a Court under the Ehtesab Ordinance. 1997 (XX of 1997), shall continue under this Act and it shall not be necessary to recall any witness or once again record any evidence that may have been taken down. "
Section 31(2)(c) of the Act specifically saved the proceedings pending before a Court under Ordinance XX on the date of promulgation of the Act and it also provided that in such proceedings it was neither necessary to recall any witness nor to record once again the evidence already recorded. We are, therefore, in no doubt, that the proceedings pending under Ordinance XX on the date of promulgation of the Act, could be continued under the Act. However, the contention of the learned counsel for the private appellants is, that the provisions of the Act being inconsistent with that of Ordinance XX, the proceedings pending under Ordinance XX could not be continued under the Act The above contention of the learned counsel , for private appellants does not appear to be without force. Ordinance CXI which was originally promulgated during the period of Caretaker Government, in its section 1(2), provided as follows:‑
"(1) Short title application aand commencement.‑‑‑(1) This Ordinance may be called the Ehtesab Ordinance, 1996.
(2) It shall apply to the holders of public offices since the 31st day of December, 1985.
(3) It shall come into force at once."
The same provisions were continued in Ordinance XX which was promulgated on 1‑2‑1997. It is, therefore, quite clear that the provisions of Ordinance CXI and Ordinance XX applied only to the holders of public offices since 31st day of December, 1985. Section 1 of the Act, however, reads as follows:‑‑
"I. Short title, application and commencement.‑‑(1) This Act may be called the Ehtesab Act, 1997.
(2) It shall apply to the holders of public offices since the 6th day of November, 1990.
(3) It shall come into force at once."
The above provisions in the Act make it clear that the provisions of the Act applied to the holders of public offices since 6th day of November, 1990. As section 31 of the Act provides that proceedings pending under Ordinance XX shall continue under the Act, it necessarily implies that such proceedings could be continued only in accordance with the provisions of the Act. Since the provisions of the Act applied to the holders of public offices since 6th of November, 1990 the proceedings pending under Ordinance XX in respect of holders of public offices for the period prior to 6th of November, 1990 could not be continued under the Act. We are, therefore, of the view that only those proceedings which were pending under Ordinance XX on the date of promulgation of the Act, were saved and continued which related to offences as defined under the Act by the holders of public offices since 6th day of November, 1990.
It is next contended by the learned counsel for private appellants that the Act was amended by Ordinance II of 1998, which was never passed by the Parliament and as such on expiry of four months' period it stood repealed in terms of Article 89(2)(a) of the Constitution. It is, accordingly, contended that amendments made in the Act through Ordinance II of 1998 consequently became ineffective and the old provisions stood revised.
The contention appears to be correct. Ordinance II of 1998 was promulgated on 4‑2‑1998. It is not disputed that Ordinance II of 1998 was not passed by Majlis‑e‑Shoora. Under Article 89 of the Constitution, this Ordinance stood repealed on 3‑6‑1998. We have already held that an. Ordinance promulgated under Article 89 of the Constitution is a temporary legislation, therefore, the amendments made in the Act by Ordinance II of 1998 stood obliterated and original provisions in the Act stood revised on repeal of Ordinance II of 1998.
It is next contended by the learned counsel for private appellants that the provisions of the Act are ex facie discriminatory. In the alternative, it is contended that the provisions of the Act have been applied in a discriminatory manner as members of only one political party have been targeted under the provisions of the Act. To support their contention that the provisions of the Act are ex facie discriminatory, it is contended that under the Act only those holders of public offices could be prosecuted for offences as defined under the Act, who held public offices since 6th November, 1990 but proceedings were kept alive under the Act even against those who held public offices prior to 6th of November, 1990.
While examining the effect of saving clause in the Act, we have already held that after the promulgation of the Act only holders of public offices, since 6th day of November, 1990 could be prosecuted and proceedings which related to offences committed prior to 6th day of November, 1990 could not be continued under the Act IX after repeal of Ordinance XX. In view of the above findings, the contention of the learned counsel for the private appellants that the provisions of the Act are discriminatory, has no relevance now. Apart from it, the classification of holders of public offices since 6th day of November, 1990 into one class is neither unreasonable nor it can be said that it had no nexus with the object of the Act. We are, therefore, not impressed by the contention of the learned counsel for private, appellants that the provisions of the Act are discriminatory. 1n so far the contention of private appellants that the provisions of Act IX have been applied in a discriminatory manner, no material has been placed before us in support of the contention. Even otherwise, such an exercise cannot be undertaken in the present proceedings which are confined only to the consideration of legal proposition.
It is lastly contended by the learned counsel for private appellants that the provisions of the Act are opposed to the Injunctions of Islam, and therefore, they are liable to be struck down. Accountability of the holders of public offices is an essence of the Islamic Polity. Under Islamic System of Governance, the holders of public offices are the trustees of the confidence reposed in them by the people and they are fully accountable for acts performed by them in discharge of their functions as holders of such public offices. The learned counsel for the private appellants have not been able to draw our attention to any Verse in the Holy Qur'an or Sunnah of Holy Prophet (peace be upon him) which' was opposed to the concept of accountability of holders of public offices. On the contrary, as pointed out above, the holders of public offices under Islamic System of Governance, are fully accountable for their acts being trustees of the people who elect them as their representatives.
The appeals stand disposed of in the terms stated above, with no orders as to costs.
(Sd.)
Saiduzzaman Siddiqui, C.,J
(Sd.)
Irshad Hasan Khan, J
(Sd.).
Raja Afrasiab Khan, J
I have recorded my separate short note.
(Sd.)
Muhammad Bashir Jehangiri, J
(Sd.)
Nasir Aslam Zahid, J
(Sd.)
Munawar Ahmed Mirza, J
(Sd.)
Ch. Muhammad Arif, J.
MUHAMMAD BASHIR JEHANGIRI, J.‑‑I have had the privilege and the benefit of going through the well‑considered judgment of the Honourable Chief Justice.
While respectfully concurring with the reasoning and the conclusions arrived at by the Honourable Chief Justice on the propositions canvassed at the bar by the learned counsel for the parties except that of the date of its application of Act IX of 1997 to the holders of public offices since the 6th day of November, 1990, 1 deem it necessary to briefly record my own views on the point.
The history of the legislation on 'transparent, even‑handed and across the board accountability of holders of all public offices' and factual background of present controversy have been succinctly narrated in detail, therefore, I need not reiterate them in my brief note of dissent on the one and the only proposition indicated above.
It was, 'inter alia' contended by the learned counsel for the appellants that the provisions of section 1(2) of the Act IX of 1997 were liable to be struck down being discriminatory in nature inasmuch as under the Act IX of 1997 the target date for commission of offences involving corruption and corrupt practices has been restricted to only 6‑11‑1990 and not from an earlier date and that too without any reasonable differentia. It was also submitted that provisions of. the Act have been applied in a discriminatory manner as substantially only persons belonging to one political party were targeted thereunder. In support of their arguments, the learned counsel for the appellants have also relied upon Article 25 of the Constitution of Islamic Republic of Pakistan, 1973,‑which lays down that "all citizens are equal before law and are entitled to equal protection of law".
The Honourable Chief Justice repelled these Constitutional objections to the fixation of target date under the Act IX of 1997 and observed as under:‑‑
"While examining the effect of saving clause in the Act, we have already held that after the promulgation of the Act only holders of public offices, since 6th day of November, 1990 could be prosecutes and proceedings which related to offences committed prior to 6th day of November, 1990 could not be continued under the Act IX after repeal of Ordinance XX. In view of the above findings, the contention of the learned counsel for the private appellants that the provisions of the Act are discriminatory, has no relevance now. Apart from it, the classification of holders of public offices since 6th day of November. 1990 into one class is neither unreasonable nor it can be said that it had no nexus with the object of the Act‑ We are, therefore not impressed by the contention of the learned counsel for private appellants that the provisions of the Act are discriminatory. In so far the contention of private appellants that the provisions of Act IX have been applied in a discriminatory manner. no material has been placed before us in support of the contention. Even otherwise, such an exercise cannot be undertaken in the present proceedings which are confined only to the consideration of legal proposition. "
"Thus, the general language of Article 14, as of its American counterpart, has been greatly qualified by the recognition of the State's regulative power to make laws operating differently on different classes of persons in the governance of its subjects, with the result that the principle of equality of civil rights and of equal protection of the laws is only given effect to as a safeguard against arbitrary State action‑ It follows that in adjudging a given law as discriminatory and unconstitutional two aspects have to be considered. First, it has to he seen whether it observes equality between all the persons on whom it is to operate. An affirmative finding on the point may not, however, be decisive of the issue. If the impugned legislation is a special lave applicable only to a certain class of persons, the Court must further enquire whether the classification is founded on a reasonable basis having regard to the object to be attained, or is arbitrary. Thus, the reasonableness of classification comes into question only in those cases where special legislation affecting a class of persons is challenged as discriminatory. But there are other types of legislation, such .as, for instance, the Land Acquisition Act, which do not rest on classification and no question of reasonable classification could fairly arise in respect of such enactments. Nor, obviously, could it arise when executive orders or notifications directed against individual citizens are assailed as discriminatory."
8 The date of taking cognizance of corruption and corrupt practices under Act IX of 1997, I say so with respect, is not only devoid of reasonableness but it has got no nexus with the objects of the Act. The fixation of this date is highly discriminatory, unjust, oppressive, and one‑sided on the ground that the two 'bigger parties' had the opportunity of getting mandate to rule the country twice since, 1988 in contradiction to that fixed in Ehtesab Ordinance (No.CXI of 1996) as 31‑12‑1985 which was promulgated by the then Caretaker Government with effect from 18‑11‑1996. Besides, the political party during whose stint Act IX of 1997 had been passed had also the good fortune of having the Chief Ministership of Punjab earlier, after the target date of 31‑12‑1985. Similarly, the regime of late Mr. Muhammad Khan Junejo was also covered by target date of 31‑12‑1985. This date of commencement seems to have been adopted by the Caretaker Government of the time in order to include only the democratically elected Governments after the Martial Law regime of Late General Muhammad Zia‑ul‑Haq. (Underlining is mine in order to highlight that earlier accountability laws indicated at pp.34 to 35 of the judgment of the Hon'ble Chief Justice covered holders of Public and Representative Offices etc. and not those which were not democratically elected regimes.) I may not, however, be misunderstood to have exempted the Martial Law regimes from the process of accountability. What I intend to highlight is the apparent reason that might have weighed with the Caretakers to adopt the date of commencement of Ordinance No.CXI as 31‑12‑1985. But the Caretakers had the ostensible reason to adopt the date that they had done. Again it is common perception that in the instant case the adopted dated as 6‑11‑1990 is not shown to have been founded on any reasonable hypothesis. Likewise persons of only one political party have been targeted and those belonging to the ruling party have .not at all been touched.
is, Act IX of 1997 which provided the date of commencement as 6‑11‑1990 does not at all hint even in the objects of Act as to why it had departed from the provisions of Ordinance CXI of 1996 wherein the date of commencement as 31st December, 1985 was indicated as the date of application of the Ordinance to the holders of public offices.
The law is well‑established that if the provisions of an enactment are administered in an arbitrary, oppressive, partial or in an unjust manner, the action taken under the said provisions can be declared as unlawful. (See: (i) East and West Sreamship Co. v. Pakistan PLD 1958 SC (Pak.) 41 and followed in (ii) The Pakistan Barbers' Association (Regd.), Lahore v. Province of Punjab through Directorate of Labour Welfare, Punjab, Lahore and another PLD 1976 Lahore 769.
I am, therefore, inclined to declare the date of application of the Act to the holders of Public Offices since 6th day of November, 1990, as unlawful but at the same time, the Act as a whole can neither be struck down nor the convictions recorded against and the sentences awarded to the appellants herein can be interfered with merely because the date of Act has been made applicable to the holders of public offices since the 6th day of November, 1990. Subsection (2) of section 1 of the Act IX of 1997 to the extent of target date is not valid, therefore, it requires to be suitably amended as to provide for an earlier date preferably as 31st December, 1985. Nonetheless this declaration will not effect the trial already concluded and convictions recorded under the Act in so far as this declaration is concerned and so would be the case of the pending trials. The parties are left to bear their own costs.
M.B.A./F‑65/S Order accordingly.
P L D 2000 Supreme Court 50
Present: Raja Afrasiab Khan and Abdur Rehman Khan, JJ
DISTRICT EDUCATION OFFICER (M), ELEMENTARY, BAHAWALNAGAR and others‑‑‑Petitioners
versus
Hafiz MUHAMMAD ALAM‑‑‑Respondent
Civil Petition for Leave to Appeal No.473‑L of 1999, decided on 26th July, 1999.
(On appeal from the judgment of the Punjab Service Tribunal dated 27‑1‑1999 passed in Appeal No.459 of 1998).
Constitution of Pakistan (1973)‑‑‑
‑‑‑‑Art. 212(3)‑‑‑Termination of service‑‑‑Civil servant, before his appointment, had qualified the written test and interview conducted by the Recruitment Committee constituted by the Government and was given the charge of his assignment but after about seven weeks of his appointment he was verbally told that his appointment was not made in accordance with Rules. as such he could not be allowed to work in pursuance of the direction of Competent Authority‑‑Validity‑‑‑Civil servant was neither associated with any inquiry nor was a party to the Constitutional petition in the High Court wherein direction for scrutiny of appointments made by a particular official of the department was made nor there was any allegation of his credentials being forged or bogus‑‑‑Nothing was available on record which could justify the restraint order passed against the civil servant‑‑‑Such verbal order being no order in the eye of law, decision of Service Tribunal to the effect that civil servant was to be deemed to be in service right from the date of his appointment and he was entitled to all back benefits, was just, fair and proper‑‑‑No question of law of public importance warranting interference by Supreme Court having been raised in support of the petition for leave to appeal against the judgment of Service Tribunal, petition was dismissed in circumstances.
PLD 1979 Lah. 699 and PLD 1998 Kar. 180 ref.
Ch. Muhammad Bashir; Assistant Advocate‑General with Rao Muhammad Yousuf, Advocate‑on‑Record for Petitioners.
Hafiz Tariq Nasim, Advocate Supreme Court with Ch.M Aslam, Advocate‑on‑Record for Respondent.
Date of hearing: 26th July, 1999.
ORDER
RAJA AFRASIAB KHAN, J.‑‑‑On 4‑2‑1997, the respondent, Hafiz Muhammad Alam was appointed by the competent Authority as Arabic Teacher in response to an advertisement having been issued by the Secretary, Government of Punjab, Education Department. The respondent before his appointment, admittedly, qualified the requisite written test and interveiw conducted by the Recruitment Committee duly constituted by Government. He was given the charge of his assignment on 6‑2‑1997. This being so, he continued to perform his official duties. It was on 26‑3‑1997 when an information was conveyed to him that his appointment was not made in accordance with the rules and as such he could not be allowed to work in pursuance of the direction of. the competent Authority vide letter dated 17‑2‑1997. The respondent filed departmental appeal which was rejected on 13‑10‑1997. ,His appeal was, however, accepted by the Punjab Service Tribunal vide impugned decision dated 27‑1‑1999. In the result, he was reinstated in service with back benefits. This is a petition for leave to appeal against the impugned order.
Learned counsel has argued that the appointment of the respondent was bad in law, inasmuch as, it was not made by the competent Authority.
There is no substance in the argument, inasmuch as, the respondent succeeded in the written test and the interview for the requisite job. He was, accordingly, appointed as Arabic Teacher. He had been performing his official duties. The Tribunal in its well‑reasoned decision observed:‑‑
"From the above discussion it appears that neither the appellant was associated with any such inquiry, nor he was a party to the writ petition in the High Court wherein a direction for scrutiny of the appointments made by Mr. Goraya was made nor there was any allegation of his credentials being forged or bogus. As such, there is nothing on record justifying the restraint order passed against the appellant. Even otherwise, the verbal order is no order in the eyes of law. Reference in this connection may be made to PLD 1970 Lahore 699 and PLD 1998 Kar. 180.
In this view of the matter, the appeal is hereby accepted. The appellant shall be deemed to be‑in service right from the date of his appointment and he shall be entitled to all back benefits."
The impugned decision of the Tribunal is just, fair and proper. No question of law of public importance warranting interference by this Court has been raised or argued by the learned counsel in support of this petition for leave to appeal. There is, therefore, no substance in this petition which is dismissed and leave to appeal is declined.
M.B.A./D‑24/S Petition dismissed.
P L D 2000 Supreme Court 52.
Present: Saiduzzaman Siddiqui, Sh. Ijaz Nisar and Sh. Riaz Ahmed, JJ
MUHAMMAD ANWAR ‑‑‑ Petitioner
versus
MUHAMMAD AKBAR and others‑‑‑Respondents
Civil Petitions Nos. 722 ‑and 802 of 1999, decided on 28th June, 1999.
(On appeal from the judgment/order, dated 25‑2‑1999, of the Lahore High Court, Rawalpindi Bench, Rawalpindi passed in C. Revisions Nos.34 and 35 of 1993).
Civil Procedure Code (V of 1998)‑‑‑
‑‑‑‑0. XLI, R.5‑‑‑Stay order‑‑‑When to start operating‑‑‑Stay order operates from the time when such order is made and not from the time same is communicated‑‑‑Ignorance of such order would not permit lower Court to render order of superior Court ineffective or nullity, and such action would not be clothed with legality when legal order to proceed had been stopped or stayed‑‑Where Trial Court had been restrained from passing the final judgment till further orders by the District Judge, reasoning given by the Appellate Court that since from the record it was not borne out as to whether the order of the District Judge staying the proceedings had been conveyed to the Trial Court and Trial court legally proceeded with the suit was devoid of any legal force.
Din Muhammad and 2 others v. Abdul Rehman Khan 1992 SCMR 127 quoted.
Gul Zarin Kiani, Advocate Supreme Court with Ejaz Muhammad Khan, Advocate‑on‑Record for Petitioner.
Mian Inamul Haq, Advocate Supreme Court with M.A. Zaidi, Advocate‑on‑Record for Respondents.
Date of hearing: 28th June, 1999.
JUDGMENT
SH. IJAZ NISAR, J.‑‑‑Leave is sought in the aforementioned petitions against the judgment, dated 25‑2‑1999, of the Lahore High Court, Rawalpindi Bench, Rawalpindi, remanding the matter to the Appellate Court (District Judge) for a fresh decision.
The facts necessary for 'the disposal of these petitions are that Muhammad Anwar petitioner filed two suits against Muhammad Akbar respondent. During the pendency of the suits Muhammad Akbar filed an application for transfer of the suits from the Court of learned Civil Judge, Gujar Khan. .According to the petitioner, although the learned Additional District Judge had stayed the proceedings on 4‑2‑1990, but the Civil Court proceeded to hear the arguments and passed the judgment/decree on 6‑2‑1990. The appeals filed by Muhammad Akbar respondent were dismissed by the learned Additional District Judge on the ground that the record did not show that proceedings had been stayed by the Additional District Judge, or that any stay order was conveyed to the trial Court. Another factor, which weighed against the respondent was that his counsel had addressed arguments before the trial Court on 6‑2‑1990, and if the proceedings had been actually stayed, he should not have done so.
Feeling aggrieved, Muhammad Akbar respondent filed revision petitions in the High Court, which were accepted by the impugned judgment. Hence, these petitions.
It is contended that High Court could not interfere in its revisional jurisdiction under section 115, C.P.C. with the concurrent findings of facts by the Courts below and further that there was no legal justification whatsoever in setting aside the judgments and decrees of the Courts below passed in favour of the petitioner.
To appreciate the circumstances leading to remand of the cases to the Appellate Court, it would be advantageous to reproduce below the operative paragraph of the impugned judgment:‑‑
`After having heard the learned lower Appellate Court must have attended to the serious allegations levelled by the petitioner against the Civil Judge. If an injunctive order was passed by the learned District Judge on the transfer applications submitted by the petitioner, the trial Court was bound to have stayed the proceedings forthwith, which, of course, was not done by it. Adjudication of a lis while an injunctive order stood passed by a superior Court was unlawful and if the First Court had passed the impugned judgment/decree during the susbsistence of an injunctive order, the decree passed by it would be nullity in the eves of law. Learned Additional District Judge could have examined the record of the transfer applications which of course was not done. Therefore, instead of rendering any decision after considering the merits of the cases of either of the parties, I would remit the matter to learned lower Appellate Court where the appeals submitted by Muhammad Akbar would be deemed to be pending. The Appellate Court shall examine the record of lower Court as well as that of transfer applications submitted by Muhammad Akbar and thereafter, ascertain any injunctive order passed by the learned District Judge was in subsistence when the judgment/decrees were passed by the First Court on 6‑2‑1990, and thereafter, decide the Appeals afresh in accordance with law. "
The learned Judge in Chambers did not go into the factual controversy but confined himself to the continuation of the proceedings by the trial Court despite the passage of injunctive order by the District Court. There is no denying the fact that the trial Court had been restrained from passing the final judgment till further orders by the District Court on 4‑2‑1990. The reasoning given by the learned Appellate Court that since from the record it was not borne out as to whether the order of the District Court staying the proceedings had been conveyed to the learned trial Court, it could legally proceed with the suit, is devoid of any legal force. It is a settled proposition of law that stay order operates from the time when such order is made and not from the time it is communicated. Din Muhammad and 2 others v. Abdul Rehman Khan 1992 SCMR 127 may be cited, wherein it was observed that ignorance would not permit lower Court to render order of superior Court ineffective or nullity, and such action would not be clothed with legality when legal order to proceed had been stopped or stayed.
In the circumstances discussed above, the learned High Court was justified to set aside the judgment and decree passed by the trial Court and to remand the case to the District Judge to decide the appeals afresh in accordance with law. These petitions are, therefore, devoid of any force, which are hereby dismissed.
M.B.A./M‑395/S Petitions dismissed.
P L D 2000 Supreme Court 55
Present: Irshad Hasan Khan, Munawar Ahmed Mirza and Ch. Muhammad Arif, JJ
THE DIVISIONAL SUPERINTENDENT, PAKISTAN RAILWAYS, LAHORE‑‑‑Appellant
versus
MUHAMMAD HALIM through Legal Representatives and others‑‑‑Respondents
Civil Appeal No. 1236 of 1996, decided on 22nd October, 1999.
(On appeal from the judgment dated 13‑11‑1995 of the Lahore High Court, passed in W.P. No.3793 of 1981).
(a) Fundamental Rules‑‑‑
‑‑‑‑F.R. 53‑=‑Constitution of Pakistan (1973), Art.185(3)‑‑‑Payment of subsistence allowance to civil servant during the period he remained suspended‑‑‑Effect‑‑‑Leave to appeal was granted by Supreme Court to consider the effect of payment of subsistence allowance to civil servant during the period he remained suspended as well as the impact of Judgment of Supreme Court in case of Government of N.‑W.F.P. v. I.A. Sherwani and another PLD 1994 SC 72 wherein, while dealing with F.R.53, Fundamental Rights, it was ruled by the Shariat Appellate Bench of the Supreme Court that according to Injunctions of Islam "‑a suspended Government servant should be allowed full amount of his salary and all other benefits and facilities provided to him under the contract of service.
Government of N.‑W.F.P. v. I.A. Sherwani and another PLD 1994 SC 72 ref.
(b) Fundamental Rules‑‑‑
‑‑‑‑ F.R. 53‑‑‑Suspension of civil servant‑‑‑Payment of salary etc. to such civil servant‑‑‑Principles‑‑‑Order of suspension of civil servant being not a penalty, would not violate any legal right vesting in the suspended officer‑‑‑If the suspension of a civil servant was not in order, at the most, he could make a claim for the balance of his unpaid salary for the period of suspension‑‑"Balance" connotes that civil servant who had remained under suspension shall be entitled to salary for the period of suspension minus the susbsistence allowance paid to him during that period.
Mian Muhammad Hayat v. The Province of West Pakistan PLD 1964 SC 321 and Abdul Khaliq Bangash v. The Secretary, Government of West Pakistan, Cooperative Department, Lahore and 2 others 1970 SCMR 103 quoted.
(c) Pakistan Railways Establishment Code‑‑‑
‑‑‑‑ Vol. II, Rr. 2043, 2044 & 2003‑‑‑Suspension of Railway employee‑‑Payment of salary etc. to such employee‑‑‑Principles‑‑‑Railway employee, who ‑had remained under suspension, when re‑instated was entitled to full salary for the period of suspension minus the amount of subsistence allowance received by him during the period of suspension‑‑‑Payment of full salary including subsistence allowance paid during the period of suspension, would tantamount to making the double payment of the same claim to the extent of the subsistence allowance which he had already received during the relevant period.
Pakistan Railways v. Aftab Ahmed and others 1988 PLC 960 approved.
Mirza Masood‑ur‑Rehman, Advocate Supreme Court and M.A. Qureshi, Advocate‑on‑Record (absent) for Appellant.
Nemo for Respondents.
Date of hearing: 22nd October, 1999.
JUDGMENT.
IRSHAD HASAN KHAN, J.‑‑‑This appeal with the leave of this Court is directed against the judgment dated 13‑11‑1995 of the Lahore High Court, passed in Writ Petition No.3793 of 1981.
The facts of the case are that Muhammad Halim respondent No. 1, now deceased, was employed in the Railway Workshops, Moghalpura, Lahore. He was suspended from service with effect from 31‑12‑1978. He approached the Labour Court No.2, Lahore for redress of his grievance under section 25‑A of the Industrial Relations Ordinance, 1969, which accepted his petition. In consequence, respondent No. I filed an application under section 15(2) of the Payment of Wages Act, 1936 (hereinafter referred to as the Act) claiming refund of a sum of Rs.3,164 in respect of his wages for the period from 31‑10‑1978 to 2‑7‑1979. The Authority under the Act allowed the application vide order dated 31,8‑1980 by directing the appellant to deposit a sum of Rs.3.,164 with it for onward payment to respondent No. 1. Being aggrieved, the appellant herein preferred an appeal against the aforesaid direction before the Punjab Labour Court No.2, Lahore which was, however, rejected by order` dated 20‑4‑1981. Dissatisfied with the above order the appellant filed Writ Petition No.5849 of 1981, which was dismissed on 13‑11‑1995.
Leave to appeal was granted to consider the effect of payment of subsistence allowance to a civil servant during the period he remained suspended, as well as the impact of the judgment of the Shariat Appellant Bench of the Supreme Court in the case of Government of N.‑W.F.P, v. I.A. Sherwani and another PLD 1994 SC 72 'in which while dealing with rule 53 of Fundamental Rules, it was ruled by the Shariat Appellate Bench of the Supreme Court that according to the Injunctions of Islam. "a suspended Government servant should be allowed full amount of his salary and all other benefits and facilities provided to him under the contract of service.
The question involved herein is whether a railway employee who has remained under suspension, when reinstated, is entitled to full salary for the period of suspension or to the salary for the said period minus the amount of subsistence allowance received by him during the period of suspension.
In the case of Mian Muhammad Hayat v. The Province of West Pakistan PLD 1964 SC 321 it was held that the order of suspension is not a penalty and it does not violate any legal right vesting in the suspended officer. The same view was reiterated in Abdul Khaliq Bang ash v. The Secretary, Government of West Pakistan, Cooperative Department, Lahore and 2 others 1970 SCMR 103; wherein Hamoodur Rahman, C.J. and Sajjad Ahmed, J. observed that "if the suspension of a civil servant is 'not in order, at the most, he can make a claim for, the balance of his unpaid salary' for the period of suspension". We are inclined to hold that the word "balance" used in the said observation connotes that a civil servant who has remained under suspension shall be entitled to salary for the period of suspension minus the subsistence allowance paid to him during the period.
The scope of Rules 2043, 2044 and 2003 of the Pakistan Railways Establishment Code, Volume II has been correctly interpreted in the case of Pakistan Railways v. Aftab Ahmed and others 1988 PLC 960, wherein it was held:
"On the above analysis there seems to be no ambiguity and there is, thus, no justification to compel the petitioner to pay to the respondent full salary now although he has already received half of it during the period of his suspension. To hold otherwise would mean decreeing the same claim twice and compelling the petitioner to make a double payment of the same claim to the extent of half of the salary which they have already admittedly paid."
The Lahore High Court was right in taking a similar view in the unreported judgment in Writ Petition No.4506 of 1982 decided on 4‑12‑1995.
Thus, visualised, in the light of case‑law discussed above, clearly the payment of full salary including subsistence allowance paid to respondent No.l during the period of his suspension would tantamount to making the double payment of the same claim to the extent of the subsistence allowance which he has already received during the relevant period.
In view of the above, we hold that respondent No. l continued to be in service in spite of his suspension and since he was ultimately reinstated, he was entitled to all the arrears of his salary which may be due to him for the period he remained under suspension minus the amount of subsistence allowance paid to him during the period of suspension in terms of Rule 2003 of the Pakistan Railways Establishment Code.
Resultantly, the impugned judgment to the above extent is set aside and the appeal is partly allowed with no order as to costs.
M.B.A./D‑21/S Order accordingly.
P L D 2000 Supreme Court 58
Present: Saiduzzaman Siddiqui, Sh. Ijaz Nisar and Sh. Riaz Ahmed, JJ
ABDUL BAQI SIDDIQUI‑‑‑Petitioner
versus
PROVINCE OF SINDH through Chief Secretary, Sindh, Karachi and 2 others‑‑‑Respondents
Civil Petition for Leave to Appeal No. 1026 of 1999, decided on 28th June, 1999.
(On appeal against the judgment dated 11‑5‑1999 of the Sindh Service Tribunal at Karachi in Appeal No.98 of 1998).
Civil service‑‑‑
‑‑‑Re‑employment‑‑‑Notification of re‑employment of civil servant was issued before his attaining the age of superannuation and regular retirement‑‑‑Such notification of re‑employment could be rescinded by the Competent Authority before 'its implementation and principle of locus poenitentiae would not be attracted in the case.
Shah Abdur Rashid, Advocate Supreme Court and Malik Mehar Khan, Advocate‑on‑Record for Petitioner.
Nemo of Respondents.
Date of hearing: 28th June, 1999.
ORDER
SH. RIAZ AHMED, J.‑‑‑Leave to appeal is sought against the judgment dated 11‑5‑1999 delivered by the Sindh Service Tribunal whereby an appeal preferred by the petitioner against the refusal of the Government of Sindh to re‑employ the petitioner on contract was dismissed. Before proceeding further it would be necessary to make a reference in brief to the facts of this case.
| | | --- | | |
3, The petitioner, thus, continued to work as Managing Director, K.W.S,B. beyond 10‑1‑1994, i.e. the date of his superannuation and on 23‑1‑1994 the respondents issued notification to the effect that the petitioner's contract for service beyond the age of superannuation would terminate after six months. The terms and conditions of the re‑employment were notified on 9‑4‑1994 and it was prescribed that the contract was liable to terminate after six months. On 24‑5‑1994 the petitioner was transferred from the K.W.S.B. with immediate effect and was directed to report in the Local Government Department till further orders. The petitioner complied with the said order, but no posting orders were issued. According to the petitioner, he was then involved in a criminal case for embezzlement, which resulted in his acquittal because no evidence could be produced to prove his guilt. On 5‑3‑1997 the petitioner submitted departmental appeal/review to the Chief Minister through the Chief Secretary, Sindh, which was not decided and, thus, the petitioner was constrained to file another Constitution Petition in the Sindh High Court. The Sindh High Court then directed that‑ the appeal/review of the petitioner should be decided within a period of one month, but the same was decided after four months and on 6‑1‑1998 the Additional Advocate‑General, Sindh informed the Court that the appeal/review of the petitioner had been rejected. The petitioner then applied for a copy of the order rejecting his appeal, but the same was not supplied to him and, thus, he invoked the jurisdiction of the Sindh Service Tribunal by way of filing an appeal, which was dismissed vide order impugned.
While seeking leave to appeal against the aforesaid order the learned counsel for the petitioner vehemently contended that the order rejecting his appeal was passed with ulterior motive and the order was mala fide and, thus, was not sustainable. It was also argued that the notification dated 25‑7‑1993 reemploying the petitioner with effect from 9‑1‑1994 could not have been rescinded and hence a vested right had accrued in favour of the petitioner to continue to serve for a period of three years beyond the age of superannuation. It was further argued that the notification dated 23‑1‑1994 re‑employing the petitioner on contract for a period of six months was arbitrary and the petitioner deserved to be re‑employed for a period of three years instead of six months. It was also argued that in the initial notification for re‑employment of the petitioner the period for re‑employment was deliberately omitted although at one point of time the Chief Minister had agreed to re‑employ the petitioner for a period of three years.
After anxious consideration, and having heard the learned counsel at length, we do not find merit in any of the contentions raised on behalf of the petitioner. In the first instance, we fail to understand as to how and in what circumstances before his retirement a notification had been issued on 25‑7‑1993 to re‑employ the petitioner for a period of three years beyond the age of superannuation. It seems that the petitioner used offer of the firm as a tool to manoeuvre his re‑employment. In our view the Tribunal rightly observed that this development was dubious in nature and furthermore the petitioner was not an exceptionally qualified person so as to find his replacement was difficult. The petitioner was an ordinary graduate in engineering and, thus, the Tribunal rightly observed that before the implementation of the notification the same could have been rescinded. The principle of locus poenitentiae would not be attracted because the notification dated 25‑7‑1993 re‑employing the petitioner for a period of three years beyond the age of superannuation had not been acted upon. The notification was rescinded before the petitioner attained the age of superannuation and in our view the Government of Sindh was competent to rescind the notification because no Government servant has a vested right to continue in service beyond the age of superannuation except in cases of exceptional nature and for that too under the policy laid down, by the Government the extension could have only been ordered by an authority next higher to the appointing authority. Admittedly the appointing authority of the petitioner, who was working in BPS‑20 was the Chief Minister and the extension in service could have only been ordered by the next higher authority, i.e. the Governor Sindh. Under the Sindh Government policy letter referred to by the Tribunal the extension in service not having been granted by the Governor Sindh had no relevance. Assuming otherwise, even then as already discussed, the petitioner cannot rely upon the notification dated 25‑7‑1993 reemploying him beyond the age of superannuation because the same was issued before his retirement and was rescinded before the same could be acted upon. No cogent material was brought on the record to substantiate the plea of mala fide. In this view of the matter, we do not find any merit in this petition. The same is‑ hereby dismissed.
M.B.A./A‑204/S Petition dismissed.
P L D 2000 Supreme Court 61
Present: Irshad Hasan Khan and Sh. Ijaz Msar, JJ
THE SECRETARY, RAILWAYS BOARD, MINISTRY OF RAILWAYS, ISLAMABAD and others‑‑‑Petitioners
versus
MUHAMMAD ZUBAIR RANA ‑‑‑Respondent
Civil Petition for Leave to Appeal No.845‑L of 1999, decided on 14th September, 1999.
(On appeal from the judgment/order, dated 17‑4‑1999, of the Federal Service Tribunal, passed in Appeal No.780(L) of 1997).
(a) Civil service‑‑‑
‑‑‑‑ Basic pay scale‑‑‑Grant of‑‑‑Basic pay scale allowed to the civil servant by the Competent Authority could not be modified or changed to his disadvantage, merely on the basis of an advice from the Finance Division.
(b) Constitution of Pakistan (1973)‑‑‑
‑‑‑‑Art. 212(3)‑‑‑Leave to appeal‑‑‑Individual grievance not involving substantial legal question of public importance‑‑‑Judgment of Service Tribunal based on sound reasoning does not call for any interference particularly when same is a case of individual grievance not involving any substantial legal question of public importance.
Ch. Shahid Saeed, Advocate Supreme Court for Petitioners.
S. Abul Aasim Jafari, Advocate‑on‑Record for Respondent/Caveator.
Date of hearing: 14th September, 1999.
JUDGMENT
SH. IJAZ NISAR, J.‑‑‑Leave is sought against the judgment, dated 17‑4‑1999, passed by the Federal Service Tribunal, in Appeal No.780‑L of 1997.
"It is further to observe that the Railway Department was never instrumental in hindering payment of the pay with effect from the date of sanction by the President of Pakistan i.e. 1st July, 1983. It when consulted the Finance Division, the latter made the trouble by demonstrating negatively and disregard of the mandatory order of the President of Pakistan and, thus, the Finance Division discriminated the appellant by rendering a negative opinion. Every civil servant is supposed to work fairly and diligently. but in the instant case the incumbent rendering the opinion cannot be treated to have rendered the opinion bonafidely and as such he be made to explain his position and not to create problems for others including the Government Departments. Due to his wrong advice a lot of inconvenience has been caused to many, waste of time and incurrence of unnecessary expenditure in litigation at many stages."
Hence, this petition by the Railway Board.
It is contended that the judgment of the Federal Service Tribunal runs counter to the policy of the Pakistan Railways and that undue benefit has been extended to the respondent in violation of the revised rules as framed by the competent Authority.
It is mentioned in the impugned judgment that since the basic pay scale was allowed to the respondent with effect from 1‑7‑1983, by the competent Authority, it could not be modified or changed to his disadvantage, merely on the basis of an advice from the Finance Division. The respondent was rightly found entitled to pay of the higher post in view of the law quoted in the impugned judgment. The judgment of the Tribunal is based on sound reasoning and does not call for any interference particularly when it is a case of individual e grievance not involving any substantial legal question of public importance. Hence, the petition is dismissed and the interim stay granted by this Court on 12‑8‑1999 is vacated.
M.B.A./S‑156/S Petition dismissed.
P L D 2000 Supreme Court 63
Present: Abdur Rehman Khan and Sh. Riaz Ahmed, JJ
GHULAM NABI and 5 others‑‑‑Appellants
versus
RASHID ‑‑‑Respondent
Civil Appeal No.932 bf 1993, decided on 7th October, 1999.
(On appeal from the judgment dated 23‑9‑1992 passed in Civil Revision No.38 of 1992 and Order dated 5‑4‑1993 passed in Civil Review Application No. I of 1993, by the Lahore High Court, Rawalpindi Bench, Rawalpindi).
Limitation Act (IX of 1908)‑‑‑
‑‑‑‑S. 14‑--Civil Procedure Code (V of 1908), S.114 & O.XLVII‑‑‑Review‑‑Maintainability‑‑‑Non‑availing the remedy available under the law against the basic order and instead prosecuting the review application in the same Court, would not entitle the petitioner to the benefit under S.14, Limitation Act, 1908‑‑‑Time so spent cannot be excluded from computing period of limitation in case the review petition is dismissed on' the grounds other than lack of jurisdiction.
Ghulam Hussain and another v. Kanwar Ashiq Ali Khan and another PLD 1980 SC 198 and Pir Muhammad v. Education Town Cooperative Society Ltd., Lahore 1982 SCMR 995 fol.
Indrajit Pratap Bahadur Sahi v. Antar Singh and others AIR 1923 PC 128 and Berhari Lal and another v. M.M. Gobardhan Lal and others AIR 1948 All. 353 distinguished.
Sh. Zamir Hussain, Advocate Supreme Court and Ejaz Muhammad, Advocate‑on‑Record for Appellants.
Abdul Karim Khan Kundi, Advocate Supreme Court and Samad Mahmood, Advocate Supreme Court for. Respondent.
Date of hearing: 7th October, 1999.
JUDGMENT
ABDUR REHMAN KHAN, J.‑‑‑This appeal with leave of the Court impugns legality of the judgment delivered in revision by a learned Judge of the High Court on 23‑9‑1992 and also the judgment dated 5‑4‑1993 passed in review petition. '
Respondent instituted suit for declaration with a prayer of permanent injunction in respect of the disputed land and also for further relief of cancellation of the deeds allegedly executed in favour of the defendant which affected his proprietary rights in the disputed land. The suit was contested by the appellant/defendant who denied ownership over the suit property.
The learned trial Court decreed the suit and that judgment was confirmed in appeal by the Appellate Court and in revision by the High Court on 23‑9‑1992. The appellant then challenged the correctness of the High Court judgment passed in revision through review petition which was dismissed on 5‑4‑1993.
The learned counsel representing the respondent raised preliminary' objection that the Civil Petition has been filed after 9 months of the order dismissing the revision petition and is, thus, time‑barred. It was clarified that the revision petition was dismissed on 23‑9‑1992, but instead of challenging it through Civil Petition in this Court the appellant preferred to file review petition against it on 11‑12‑1992, which was dismissed on 5‑4‑1993, and then this petition was moved to challenge the orders that were passed in revision and review. It was argued that the order passed in revision has obtained finality as it was not challenged in time and by the time the Civil Petition was filed, the requisite time had already expired but no application for condonation of delay was ever submitted. He submitted that time spent in. proceedings in review petition cannot be excluded in computing the period of limitation. The learned counsel placed reliance in support of his points on the following judgments:‑‑
(i) Ghulam Hussain and another v. Kanwar Ashiq Ali Khan and another PLD 1980 SC 198.
(ii) Pir Muhammad v. Education Town Cooperative Society Ltd., Lahore 1982 SCMR 995.
The learned counsel for the appellant while replying the preliminary objection referred to page 175 of the paper‑book containing leave granting order and pointed out that there was mention of misreading and non‑reading of evidence while deciding the revision petition which according to him justified filing of the review petition. We find that this reference is irrelevant as it has no relevance with the point of limitation agitated from the respondent's side. Learned counsel for the appellant then argued that the judgment reported as PLD 1980 SC 198, has not laid down correct law as it has overlooked the fact that review is substantive right having been conferred by section 114 and Order XLVII,' C.P.C., therefore, he was of the view that the time consumed in prosecuting the reveiw petition was to be excluded from reckoning the period of limitation. He relied on (Raja) Indrajit Pratap Bahadur Sahi v. Amar Singh and others AIR 1923 Privy Council 128 and Behari Lai and another v. M.M. Gobardhan Lai and others AIR (35) 1948 Allahabad 353 to support his stand. The learned counsel in the end submitted that the judgment passed in revision was wrongly challenged in this petition and that he would not press this appeal against the said judgment.
There is no denying the fact that the right of filing review petition is substantive right as it has been allowed by section 114 and Order XLVII, C.P.C. But the crucial point that arises for determination in this case is 'whether nonavailing the remedy available under the law against the basic order and instead prosecuting the review in the same Court would entitle the petitioner to the benefit' under section 14 of the Limitation Act or in other words the time so spent can be excluded, from computing period of limitation. The answer would be in the negative in case the review petition is dismissed on the grounds other than lack of jurisdiction. It has been so 'held in PLD 1980 SC 198, as the following portion of the judgment indicates:‑‑
"The present petition against the basic order of the High Court dated 14‑12‑1977 is barred by 395 days and there is no application nor prayer either for condonation of delay or to set aside that order as such. When confronted with this situation the .learned counsel argued that the present is a petition against the order dated 12‑2‑1978 refusing to review the previous order dated 14‑12‑1977 and in its own turn is within limitation qua that order. This may be so but while seeking leave to appeal against order refusing to review the main previous order, in fact the object of the petitioner is to seek vacation of the said previous order which by efflux of time has become final. The fact that in review the Court further affirmed the aforesaid order is immaterial inasmuch as a refusal to review the same will not give a fresh period of limitation to challenge it. In this peculiar situation they cannot be allowed to bypass it by simply pleading that the present petition is against order refusing to review the same because while stating so their intention is to point out errors and mistakes in the basic order which were sought to be removed through a review application but which failed. There may be cases where for instance petition of review may be refused merely ‑for want of jurisdiction in which of course a petition may lie but will be on ground of refusing to exercise jurisdiction vested in a Court by law on the ground that it has no jurisdiction whereas in fact and in law it had such jurisdiction. In those cases a petition against refusal to review will not be a petition directly or indirectly against the main previous order on merits but only against the order in review itself. The position in the instant case is, however, different. Here the question is not of lack of jurisdiction of the High Court to entertain review, but after entertaining it refusing the same on the ground that no case for review on merits exists, such decision will essentially compel a suitor to challenge the previous order itself to point out the mistakes allegedly existing therein, which exercise obviously cannot be resorted to if the period of limitation for challenging the main previous order has run out and because you cannot do that indirectly which you cannot do directly. "
It has been laid down in 1982 SCMR 995:
"There is no ground to condone the delay in filing the petition against the judgment delivered in the Regular Second Appeal. Learned counsel for the petitioner has submitted that he should be allowed the benefit of section 14 of the Limitation Act. Section 14 of the Limitation Act is not attracted to the facts of this case because the review petition was not dismissed on account of a defect of jurisdiction, or other cause of alike nature.'"
We. therefore, hold that the Civil Appeal is time‑barred and dismiss it as such without discussing the merits of the appeal. Parties would, however, bear their own costs.
M.B.A./G‑56/S Order accordingly
P L D 2000 Supreme Court 67
Present; Abdur Rehman Khan and Sh. Riaz Ahmed, JJ
ALTAF HUSSAIN ‑‑‑Appellant
versus
Mst. NUZHAT‑UN‑NISA‑‑‑Respondent
Civil Appeal No.376 of 1995, decided on 14th October, 1999.
(On appeal from the judgment dated 2‑8‑1994 of the High Court of Balochistan, Quetta, passed in F.A.O. No.42 of 1994).
West Pakistan Urban Rent Restriction Ordinance (VI of 1959)‑‑‑
‑‑‑‑S. 13(3)‑‑‑Bona fide personal need of landlord‑‑‑Proof and effect‑‑‑Mere demand for enhancement of rent and previous ejectment application would not detract from the veracity of an eviction petition based on personal need of landlord if the same is instituted in changed circumstances on a different cause of action and is substantiated by reliable evidence to prove bona fide personal need.
Syed Hamid Mahmood Gilani v. Abdul Rehman 1996 SCMR 1097 distinguished.
National Development Finance Corporation, Shahrah‑e‑Quaid‑e‑Azam, Lahore v. Shaikh Naseem‑ud‑Din and 4 others PLD 1997 .SC 564; Fazal Azim and another v. Tariq Mahmood and another PLD 1982 SC 218 and Shamsul Islam Khan v. Pakistan Tourism Development Corporation Ltd. 1985 SCMR 1996 ref.
Basharatullah, Advocate Supreme Court for Appellant.
M. Aslam Chishti, Advocate Supreme Court for Respondent.
Date of hearing: 14th October, 1999.
JUDGMENT
ABDUR REHMAN KHAN, J.‑‑This appeal with leave of the Court calls in question the correctness of the judgment delivered on 2‑8‑1994, by the learned Chief Justice of Balochistan High Court whereby, the appeal, preferred by the respondent was accepted, the judgment of the learned Rent Controller was set aside and consequently, application filed by the respondent under the Rent Laws for ejectment of the appellant from the disputed shop, was accepted.
"It has been pointed out that this is the third eviction application of its kind; the first was instituted on 23‑5‑1979, one of the grounds being that the premises were required for the use of the landlady's son named Mohyuddin Ahmed Farooqi; that application was withdrawn on 11‑8‑1981. The second eviction application was filed on 19‑8‑1981, the ground then being that the premises were required for the use of the landlady's son Muhammad Ahmad Farooqi. The learned Rent Controller dismissed that application holding that the premises were not required in good faith by the landlady. In the High Court, the eviction application was withdrawn and the rent was raised to Rs.550. The present petition was on the ground that the premises were required for the use of the landlady's son Hassan Ahmad Farooqi."
"(1) That the applicant's real son namely Hassan Ahmed Farooqi is presently studying in Government Degree College, Quetta in B.Com. However, in future instead of joining service he intends to start his own business of spare parts etc.
(2) That the applicant required the shop in question for personal bona fide use and occupation of her son namely Hassan Ahmed Farooqi in order to enable him to start business of motor spare parts etc. in the shop in question which is occupied by the respondent as tenant and which is very suitable to start such business."
(3) That the contents of para. No.3 of the application are not admitted to be correct. The requirement of the shop in question by the applicant for his said son is not bona fide and reasonable and td the contrary is mala fide.
(i) Briefly the background of the case is that the shop in question was originally rented out to one Sadiq by the applicant against the monthly rent of Rs.20 only, against whom eviction application was filed on the ground of personal requirement, who consequently was evicted therefrom and thereafter instead of utilizing the shop by the applicant for which the tenant was evicted, leased out to this respondent in the year, 1977 and an amount of Rs.60,000 was received by the applicant by way of goodwill of the shop in question from the respondent. Rent v deed was also executed between the parties and the rent was fixed to be Rs.200 per month.
(ii) In May, 1979 the applicant filed eviction application against the respondent on the ground that the shop in question was required by her for the needs and requirement of her son namely Mohyuddin Ahmed for the purposes of business and during the pendency of the eviction proceedings enhanced the rent of the shop to Rs.300 per month and on 8‑11‑1981 withdrew the eviction application.
(iii) For the 2nd time eviction application against the respondent was filed by the applicant on the ground that the shop in question was required for the needs of business of her another son namely Muhammad Ahmed Farooqi, who too at the relevant time was studying. In August, 1987 the eviction application was dismissed by the Court of Civil Judge‑II/Rent Controller, Quetta and against dismissal, Appeal was preferred in the Honourable High Court of Balochistan, Quetta and the same was disposed of as per compromise between the parties on 20‑3‑1988 by enhancement of the rent of the shop to Rs.550 per month.
(iv) After some time the rent of the shop on demand of the applicant was raised to Rs.600 per month and a few months thereafter the applicant's attorney and husband insisted for the increase of rent to Rs.700 per month or to face eviction proceedings. The respondent, thus, under the compelling circumstances, accepted the demand and agreed to pay Rs.700 per month.
(v) A month prior to the institution of the present eviction application demand was made persistently on behalf of the applicant by her husband to pay the rent at the rate of Rs.1,000 per month and to pay additionally an amount of Rs.22,000 to the applicant by way of enhanced rent with retrospective effect on the ground that the rent was not to her satisfaction increased previously; also to face eviction proceedings.
(vi) The alleged requirement of the shop in question by the applicant for her son is mala fide. The applicant in fact intends to raise the rent of the shop to Rs.1,000 per month in addition to it, wants to. extract money from the respondent on one or the other pretext. She had been successfully doing the same even previously by filing eviction application on the same ground."
The learned Rent Controller by order dated 19‑3‑1994, held that the applicant/landlady failed to prove her bona fide that she needed the shop for her son and as such dismissed the application, but by the impugned judgment the learned Chief Justice came to a contrary conclusion and held that no mala fide was involved and that the applicant in good faith requires the disputed shop for the business of her son.
The learned counsel appearing for the appellant argued that the conduct of the landlady/respondent has not been kept in view by the High Court while declaring her entitled to get the shop vacated for the use of her son. It was explained that the landlady had before the present application brought three other ejectment applications, out of which one was against the previous tenant Siddique and two against his client on the same ground of personal need of her son. This point has been clarified in detail in the written statement which has been reproduced above and, therefore, there is no need to repeat the same factual aspect again. Article 24 of Qanun‑e‑Shahadat and Syed Hamid Mahmood Gilani v. Abdul Rehman 1996 SCMR 1097 was referred in support of his submission. In reply, .the learned counsel pleading for the respondent first pointed out that the Order‑sheet of this Court dated 20‑5‑1998, and 19‑5‑1998; would show that offer of three times increase in rent was refused by the respondent. He stressed that there was 'no denial of the fact that Hassan Ahmed Farooqi, for whom the shop is required, is jobless and the landlady has no other shop for the business of her son. He supported his submission by National Development Finance Corporation, Shahrah‑e‑Quaid‑e‑Azam, Lahore v. Shaikh Naseem‑ud‑Din and 4 others PLD 1997 SC 564; Fazal Azim and another v. Tariq Mahmood and another PLD 1982 SC 218 and Shamsul Islam Khan v. Pakistan Tourism Development Corporation Ltd. 1985 SCMR 1996.
The crucial and decisive point in the present litigation is as to whether the landlady has succeeded by leading reliable and sufficient evidence to prove that the disputed shop is required by her for the use of her son Hassan Ahmed Farooqi. If this fact stands substantiated on record, then the other matter like previous conduct of the landlady and her filing earlier ejectment applications to get the tenant ejected from the disputed shop for the use of her other sons would become a matter of secondary importance. It is not denied that previous conduct is relevant fact and for that reason the evidence bearing on personal need of the present son, must be closely examined as in such a case it requires to be determined 'whether the conduct militates against her bona fide claim of her personal need in respect of the son for whom it is required in the present litigation. It is important to note that the learned counsel for the appellant did not refer to the evidence on record to argue that it was lacking in proving bona fide need and he all along stressed and relied only on the previous conduct of the respondent by referring to the earlier ejectment applications which had been filed for her two sons other than the one for whom it is now required. So, it can safely be presumed that the learned counsel could not point out any defect in the evidence led by the landlady to prove her requirement or in other words the evidence on record was sufficient to substantiate that the shop was needed for Hassan Ahmed Farooqi. The learned Chief Justice was correct in holding that the need for Hassan Ahmed Farooqi is independent cause of action from the need of her other sons for whom the earlier applications had been filed and the present application was, therefore, required to be adjudged on its own merits, irrespective of the previous litigation.‑It is important to note that more than 20 years ago, on 23‑5‑1979, the landlady brought the first application for ejectment of the then tenant for the occupation of the shop by her son Mohyuddin Ahmed Farooqi and it could not be refuted that her son during the course of time joined service in Radio Pakistan and as the efforts to get the tenant ejected in time having frustrated, naturally the matter was compromised. It could also not be controverted that the ‑ landlady filed second application for ejectment on 19‑8‑1981, and it is deplorable to note that in full 7 years it could not be decided even by the trial Court, so her son left for America to earn his livelihood and the litigation, thus, ended through compromise: It is by now well‑settled that mere demand for enhancement of rent and previous ejectment applications would not, detract from the veracity of an eviction petition based on personal need if it is instituted in changed circumstances on a different cause of action and is substantiated by reliable evidence to prove bona fide personal need. The judgment reported as 1996 SCMR 1097, relied on by appellant's Advocate proceeds on entirely different facts as in that case bona fide need could not be established. On the other hand the precedent cases relied on from respondent's side support the contention raised by the learned Advocate. It is to be emphasized that the respondent could not get the premises vacated for the last 20 years and her previous efforts in this respect had become infructuous by efflux of time, therefore, the appellant is directed to deliver the vacant possession of the disputed shop before 30th November, 1999, and if he failed to do so then after the expiry of this period the appellant shall be evicted by force with the aid of Polite even without prior notice. The appeal is dismissed but with no order as to costs.
M.B.A./A‑205/S Appeal dismissed.
P L D 2000 Supreme Court 71
Present: Irshad Hasan Khan and Sh. Ijaz Nisar, JJ
MUHAMMAD IBRAHIM and others‑‑‑Petitioners
versus
Syed AHMAD and others‑‑‑Respondents
Civil Petition for Leave to Appeal No.793‑L of 1999, decided on 22nd September, 1999.
(On appeal from the order dated 17‑12‑1998 passed by Lahore High Court, Lahore in C.M. No. 1 of 1998 in Criminal Original No.71/W/94 in W.P. No.23‑R of 1987).
(a) Constitution of Pakistan (1973)‑‑‑
‑‑‑‑Art. 199‑‑‑Constitutional jurisdiction of High Court under Art.199 of the Constitution‑‑‑Nature of proceedings.
Whether the proceedings were civil or not depends upon the nature of the subject‑matter of the proceedings and its object and not on the mode adopted or the forum provided for the enforcement of the right. Proceedings, which deal with a right of civil nature do not cease to be so merely because the writ is said to be enforced by having recourse to the writ jurisdiction.
Hussain Bakhsh v. Settlement Commissioner, Rawalpindi PLD 1970 SC 1 rel.
(b) Contempt of Court Act (LXIV of 1976)‑‑‑
‑‑‑‑Ss. 3, 4 & 7‑‑‑Constitution of Pakistan (1973), Art.204‑‑‑Contempt of Court‑‑‑Superior Courts are not bound by the provisions of Civil Procedure Code, 1908 or Criminal Procedure Code, 1898 or by the technicalities of ordinary criminal proceedings or civil proceedings in dealing with a contempt matter‑‑‑Basic requirement in such cases is the ascertainment of truth by providing the contemner a fair hearing to defend himself‑‑‑Principles.
Admittedly, the Code of Civil Procedure regulates civil proceedings but the contempt proceedings are neither civil nor criminal and it partakes both. The power exercised by the Court in contempt proceedings is in the nature of special jurisdiction. Section 7 of the Contempt of Court Act, 1976 lays down a procedure for Supreme Court and High Court. Where it is necessary in the interest of effective administration of justice to proceed against a contemner, he may be proceeded against by getting forth the substance of the charge against him and the ground on which he is charged with contempt of Court and calling upon him to show cause why he should not be punished, after holding such enquiry and taking such evidence as the Court deems necessary. A bare perusal of section 7 of the Act indicates that section 12(2), C.P.C. is not applicable to proceedings initiated under the Act. Clause (3) of Article 204 of the Constitution provides that the exercise of the power conferred on a Court may be regulated by law and subject to law by rules made by the Court. The superior Courts are not bound by the provisions of the Civil Procedure Code or the Code of Criminal Procedure or by the technicalities of ordinary criminal proceedings or civil proceedings in dealing with a contempt matter. The basic requirement in such cases is the ascertainment of truth by providing the contemner a fair hearing to defend himself.
The jurisdiction of Courts of Record or superior Courts to punish for contempt by the summary process of attachment or committal is a special jurisdiction, which is inherent in all such Courts as an essential concomitant of their power to preserve order in judicial proceedings and to maintain the authority of law. There is no fixed formula for contempt proceedings and technical accuracies are not required nor are the superior Courts bound by the provisions of the Code of Criminal Procedure or by the technicalities of ordinary criminal proceedings. All that is necessary is that the fundamental rules for the ascertainment of truth should be followed and the contemner should be given the fullest opportunity defending himself.
G.S. Gideon v. The State PLD 1963 SC 1 quoted.
Mian Husrat Ullah, Senior‑ Advocate Supreme Court and Muhammad Bashir Malik, Advocate Supreme Court for Petitioners.
Rana Muhammad Anwar, Advocate Supreme Court with S. Abul Aasim Jafri, Advocate‑on‑Record for Respondent No. 1.
Date of hearing: 22nd September, 1999.
JUDGMENT
IRSHAD HASAN KHAN, J. ‑‑‑This petition under Article 185(3) of the Constitution of the Islamic Republic of Pakistan, 1973, is directed against the order dated 17‑12‑1998, passed by a learned Division Bench of the Lahore High Court, Lahore in Criminal Miscellaneous No.1 of 1998 in Criminal Original No. 71/W of 1994 in Writ Petition No. 23‑R. of 1987.
On 21‑12‑1993, Syed Ahmed filed a petition (Criminal Original No. 71/W of 1994) under sections 3 and 4 of the Contempt of Court Act, 1976 (hereinafter referred to as the Act), read with Article 204 of the Constitution, against Muhammad Ikram, Muhammad Ibrahim and Manzoor Hussain sons of Muhammad Hussain,' writ petitioner, in Writ Petition No.23‑R of 1987, inter alia, stating therein. that there was dispute between Syed Ahmed applicant and the father of the above contemners regarding land measuring 80 Kanals and 8 Marlas situate in Chak No.30/UCC, Tehsil Ferozewala, District. Sheikhupura and that in spite of the order of status quo dated 8‑10‑1987; passed by the High Court, Mutation No. 129 in respect of the same land was entered in the names of the petitioners herein and, in this way, they had committed contempt of the High Court. It was also stated in the application that Muhammad Hussain, father of the petitioners herein obtained the status quo order about the land, in dispute, but thereafter, the petitioners herein filed a civil suit in the Court of Senior Civil Judge, Shejkhupura and obtained ex parte decree about the land, in question, getting the change about the ownership of the land thus committing contempt of the High Court and were liable to be punished for the same. Criminal Original No.71 /W of 1994, was dismissed by a learned Division Bench vide order dated 3‑4‑1994,in the following terms:‑‑
"The grievance of the petitioner is that during the pendency of W.P. No:23‑12 of 1987, the respondent petitioner in the said writ petition had obtained an order of status quo in C.M. No.409 of 1987. Thereafter lie filed a civil suit for declaration that he was the owner of the property iii dispute and obtained ex parte decree in the said suit and in pursuance of the same got a mutation sanctioned in the Revenue Record, which is violative of the said order passed by this Court,, therefore, he should be punished for contempt of Court. The prayer in C.M. No.409 of 1987 was that during the pendency of W.P. No..23‑R of 1987, the petitioner's possession over the property in dispute should be preserved and the present petitioner/respondent in the writ petition should be restrained from alienating the property in dispute."
After hearing learned counsel for the petitioner, we are of the view that the status quo order shall be deemed to have been passed in terms of these two prayers, therefore, the act of the respondent of filing of the said suit prima facie does not amount to violation of the said order. We have also gone through the copy of the decree passed in the said suit, which has been placed on record, It shows that the present petitioner was not made a party in the same, therefore, the said decree prima facie is not binding on the petitioner. The respondent was not restrained from seeking any remedy available to him against any other person by filing a suit We notice that after the said decree was passed, the respondent's W.P. No‑23‑R of 1987 was dismissed by this Court upholding the transfer of the property in dispute in favour of the present petitioner. The petitioner is at liberty to get the entries made in the Revenue Record according to the judgment passed by this Court to the said writ petition. No case for contempt of Court has been made out, therefore, this application is dismissed."
Syed Ahmed also moved Civil Miscellaneous Application No. l of 1998 in Criminal Original No.71 /W of 1994 in Writ Petition No.23‑R of 1987 under section 12(2) read with 114/151, C.P.C. for setting aside the order dated 3‑4‑1994 passed by a learned Division Bench of the Lahore High Court, Lahore in Criminal Original No.71/W of 1994 in W.P. No.23‑R of 1987. The prayer clause reads thus:‑‑ ‑ .
"It is, therefore, respectfully prayed that the impugned order dated 7‑4‑1994 to the extent of the observation:
?We notice that after the said decree was passed, the respondent's W.P.23‑R of 1987 was dismissed by this Court upholding the transfer of the property in dispute in favour of the present petitioner. The petitioner is at liberty to get the entries made in the Revenue Record according to the judgment passed by this ,Court in the said Writ Petition.'
'Be set aside/modified in the interest of Justice and petition of the respondent No.1 be dismissed to that extent. The delay if any in filing of this application may also kindly be condoned and this application be heard on merits.'
'It is further prayed that the operation of the impugned order be suspended and the respondent No.4 be restrained not to eject the petitioners from the disputed land till the final decision of this petition.'
'Any other relief which this Hon'ble Court deems fit and appropriate may also be granted'."
"This application on the face of it is misconceived. The main petition was a criminal original for taking action against the respondents who allegedly committed contempt of Court which was a criminal or at least quasi‑criminal in nature to which C.P.C. does not apply. An application under section 12(2), C.P.C. cannot be filed in a criminal case.
5.???????? Mian Nusrat Ullah. learned Senior Advocate Supreme Court for the petitioners contends that whether the proceedings were civil or not depends upon the nature of the subject‑matter of the proceedings and its object and not on the mode adopted or the forum provided for the enforcement of the right. He contends that proceedings, which deal with a right of civil nature do not cease to lie so merely because the writ is said to be enforced by having recourse to the writ jurisdiction.
"The writ jurisdiction under Article 98 of the Constitution, as already stated, is an original jurisdiction. Obviously, the jurisdiction under that Article pertains to civil as well as other matters. At the moment, I shall consider the nature of the proceeding arising out of a writ petition relating to a civil matter, as in the instant case. A proceeding taken for the enforcement of a civil right is a civil proceeding, whatever may be the source of the Court's jurisdiction invoked for enforcement of such a right. According to Stround's Judicial Dictionary, Civil proceedings is a process for recovery of individual right or redress of individual wrong, inclusive, in its proper legal sense, of suits by the Crown see Bradlough v. Clarks (2). Whether a proceeding is civil or not depends on the nature of the subject‑matter of the proceeding and its object, and not on the mode adopted or the forum provided for the enforcement of the right. A proceeding which deals with a right of a civil nature does not cease to be so merely because the right is sought to be enforced by having recourse to the writ jurisdiction. Judged from these aspects, a proceeding under Article 98 of the Constitution relating to a civil matter is a civil proceeding, although the High Court's jurisdiction in such a proceeding is Constitutional jurisdiction of an original kind. A civil proceeding in a Court of civil jurisdiction is governed by the Code of Civil Procedure (see its preamble). By virtue of section 117 of the Code, a civil proceeding in a High Court is also governed by the provisions of the Code other than the provisions which are specially excepted. A proceeding under Article 98.of the Constitution concerning a civil matter being a civil proceeding relating to the High Court's original civil jurisdiction and section 114 of the Code conferring power of review not having been made inapplicable to the High Court in the exercise of its original civil jurisdiction, the power of review an order made by the High Court in its writ jurisdiction will be available to it under the said section 114 if that section is otherwise applicable."
"The jurisdiction of Courts of Record or superior Courts to punish for contempt by the summary process of attachment or committal is a special jurisdiction, which is inherent in all such Courts as an essential concomitant of their power to preserve order in judicial proceedings and to maintain the authority of law. There is no fixed formula for contempt C proceedings and technical accuracies are not required nor are the superior‑Courts bound by the provisions of the Code of Criminal Procedure or by the technicalities of ordinary criminal proceedings. All that is necessary is that the fundamental rules for the ascertainment of truth should be followed and the contemner should be given the fullest opportunity of defending himself. "
M.B.A./M‑398/S??????? ???????????????????????????????????????????????????????????????????????????????????????????????? petition dismissed.
P L D 2000 Supreme Court 77
Present: Saiduzzaman Siddiqui, CJ, Irshad Hasan Khan, Raja Afrasiab Khan, Muhammad Bashir Jehangiri, Nasir Aslam Zahid, Munawar Ahmed Mirza and Ch. Muhammad Arif, JJ
Mohtarma BENAZIR BHUTTO ‑‑‑Petitioner
versus
PRESIDENT OF PAKISTAN and 2 others ‑‑‑Respondents
Review Petition No.6 of 1998 in Constitutional Petition No.59 of 1996, decided on 11th October, 1999.
(On review of the order dated 29‑1‑1997 and judgment dated 13‑9‑1997 passed by this Court in Constitutional Petition No.59 of 1996).
(a) Constitution of Pakistan (1973)‑‑‑
‑‑‑‑Art. 188‑‑‑Supreme Court Rules, 1980, O.XXVI, R.1‑‑‑Review‑‑‑Review of judgment or order of the Supreme Court conditions‑‑‑Principle‑‑‑Remedy to seek review under Art. 1.88 of the Constitution read with O.XXVI, R.1, Supreme Court Rules, 1980 is sought only under exceptional circumstances falling within the purview of review and in aid of justice‑‑‑Judgment under review in the present case was passed after hearing the counsel for the parties at length and examining their pleadings and the material available on record; Bench seized of the case had clearly granted the petitioner sufficient indulgence in the conduct of the proceedings to ensure that the petitioner obtained a fair hearing and no miscarriage of justice had occurred and Judges constituting the Bench rendered the decision by majority of 6 to 1, holding that the material produced on behalf of the respondent was relevant and came to the conclusion that all the grounds mentioned in the. order had nexus with the proceedings mentioned in relevant provision of the Constitution‑‑‑Effect‑‑‑Grounds urged for rehearing the matter in the garb of review petition, held, could not be allowed as Supreme Court would not sit as a Court of appeal against the order/judgment under review‑‑‑No mistake having crept in the judgment under review, there was, therefore, no justification for reviewing the same, in so far as the same related to the merits of the case.
Malik Asad"Ali v. Federation of Pakistan PLD 1998 SC 161 and AI Jehad Trust v. Federation of Pakistan PLD 1996 SC 324 ref.
(b) Constitution of Pakistan (1973)‑‑‑
‑‑‑‑Art. 188‑‑‑Supreme Court Rules, 1980, O.XXVI, R.1‑‑‑Review of judgment or order of the Supreme Court‑‑‑Scope.
Mian Rafiq Saigol and another v. Bank of Credit and Commerce International (Overseas) Ltd. and others PLD 1997 SC 865 and Mohtarma Benazir Bhutto v. The State PLD 1999 SC 937 ref.
(c) Constitution of Pakistan (1973)‑‑‑
‑‑‑‑Arts. 184 & 58(2)(b)‑‑‑Constitutional petition before Supreme Court under An. 184(3), Constitution of Pakistan challenging the validity of the order of the President of Pakistan under Art.58(2)(b) of the Constitution‑‑‑Observations 'of Supreme Court made in the order/judgment were restricted, in their application, to the proceedings under Art. 184 of the Constitution for the purposes of Art.58(2)(b) of the Constitution alone' and were not to be treated as proof of the charges 'for any other purpose.
Khalid Malik and others v. Federation of Pakistan and others PLD 1991 Kar. 1 ref.
Aitzaz Ahsan, Advocate Supreme Court instructed by Mehr Khan Malik, Advocate‑on‑Record for Petitioner.
° Ch. Muhammad Farooq, Attorney‑General for Pakistan and Sher Zaman, Deputy Attorney‑General with Ch` Akhtar Ali, Advocate‑on‑Record for Respondents.
Date of hearing: 11th October, 1999.
JUDGMENT
IRSHAD HASAN KHAN, J.‑‑‑This review petition under Article 188 of the Constitution of the Islamic Republic of Pakistan, 1973 (hereinafter referred to as the Constitution) read with Order XXVI, Rule I of the Supreme Court Rules, 1980 (hereinafter called the Rules), is directed against the short order dated 29‑1‑1997 and judgment dated 13‑9‑1997 of this Court, whereby the Constitutional Petition No.59 of 1996, filed by the petitioner, seeking to challenge the validity of the order passed by the then President of Pakistan Mr. Farooq Ahmed Khan Leghari, dissolving the National Assembly and all four Provincial Assemblies, under Article 58('2)(b) of the Constitution, was dismissed.
First, that the seven‑member Bench of this Court which delivered the judgment was improperly presided over and constituted by the then Hon'ble Chief Justice, Mr. Justice Sajjad Ali Shah, in that, it was held by this Court in Malik Asad Ali v. Federation of Pakistan PLD 1998 SC 161, vide Short Order dated 23‑12‑1997 that in the light of the decision in the case of Al‑Jehad Trust v. Federation of Pakistan PLD 1996 SC 324, the appointment of Mr. Justice Sajjad Ali Shah`, as Chief Justice of this Court, was improper and violative of the principle of seniority. The precise submission is that he was 'not de jure Chief Justice of Pakistan, therefore, all decisions rendered by him, were incompetent.
The contention is not sustainable because this Court in the case of Malik Asad. Ali (supra), held:‑‑
" .. . . We further hold that all actions taken and orders passed by respondent No.2 in his capacity of Chief Justice of Pakistan, up to 25‑11‑1997 will be deemed to have been validly taken and passed and will not be open to any challenge on the ground of defect in the appointment of respondent'No.2 as Chief Justice of Pakistan. However, all actions taken or orders passed by respondent No.2 as Chief Justice of Pakistan on and after 26‑11‑1997 are declared of no legal effect."
Secondly, this Court misinterpreted the scope of Article 58(2)(b) as mandated by the binding decision in the Nawaz Sharif Case and other binding precedents; thirdly this Court erroneously and by misinterpreting binding precedent decided that the President could permissibly rely upon newspaper clippings and other material not meeting the standards provided by the laws of evidence; fourthly, this Court erroneously allowed the‑ President to justify his charges on the basis of material gathered after the dissolution order was passed and has erroneously placed the onus of proof upon the petitioner; fifthly, this Court erroneously concluded that there was sufficient material having nexus with the charges stated by the President misappreciating and misreading the material produced by the respondents, and misapplying and misinterpreting the law relevant to the allegations; sixthly, this Court misappreciated and misread the material related to charge of extra judicial killings; seventhly, this Court misread and misappreciated the material and misapplied and misinterpreted the law relating to separation of the Executive from the Judiciary; eighthly, this Court misread and misappreciated the material and the law relating to the alleged wiretapping; ninthly, this Court misread and misappreciated the material and misinterpreted and misapplied the law relating to the allegations of corruption; and lastly, this Court misread the pleadings of the parties and misappreciated the arguments advanced by the petitioner as also giving unfair and unequal treatment to the pleadings of the parties.
"Supreme Court derives the power to review its decisions under Article 188 of the Constitution of Islamic Republic of Pakistan.
To regulate the practice and procedure of Supreme Court and to govern the proceedings initiated before it, Supreme Court has framed the Rules known as Supreme Court Rules, 1980 in exercise of the power conferred by Article 191 of the Constitution, Rule 1 of Order XXVI regulates the review proceedings before Supreme Court.
The power of review, available to Supreme Court under the above provisions in respect of matter arising on the civil side is analogous to the power of the Civil Courts under Order XLVII, Rule 1 of the Code of Civil Procedure, 1908.
Where a conscious and deliberate decision has been made with regard to the nature of orders which it is empowered to pass under a provision of law only, because another view with regard thereto is canvassed cannot and does not constitute a ground for review.
A review can lie on the ground of an error only if it is, material to the conclusion reached in the judgment sought to be reviewed.
The exercise of review jurisdiction does not mean a rehearing of the matter and as finality attaches to the orders, a decision, even though it is erroneous per se, would not be a ground to justify its review. Accordingly, in keeping with the limits of the review jurisdiction, it is futile to reconsider the submissions which converge on the merits of the decision.
Before an error can be a ground for review it is necessary that it must be one which is apparent on the face of the record, that is, it must be so manifest so clear that no Court could permit such an error to remain on the record. It may be an error of fact or of law, but it must be an error which is self‑evident and floating on he surface and does not require any elaborate discussion or process of ratiocination.
Review of the order of Supreme Court on the ground that after the passing of the orders by Supreme Court there has been improvement in `the status of the petitioner is not a valid ground for review.
A review petition would not lie on the grounds which were already advanced at the hearing of appeal or petition and were attended to by the Court.
Review petition cannot be allowed to be pressed on the basis of material available and not produced earlier but produced for the first time in review.
Contention not raised at the hearing of petition for leave to appeal or appeal cannot be allowed to be raised in review proceedings.
The ground of non‑hearing of appellant in respect of order passed in suo Motu jurisdiction by a lower forum can be a ground of error apparent on the face of the order.
Assumption of Court that the petitioner was successor‑in‑interest of the transferee while in fact it was not so, can be considered as an error apparent on the face of the order.
Review proceedings cannot partake re‑hearing of a decided case. Therefore, if the Court has taken a conscious and deliberate decision on a point of law or fact while disposing of a petition or an appeal, review of such judgment or order cannot be obtained on the grounds that the Court took an erroneous view or that another view on reconsideration is possible. Review also cannot be allowed on the ground of discovery of some new material, if such material was available at the time of hearing of appeal or petition but not produced. A ground not urged or raised at the hearing of petition or appeal cannot be allowed to be raised in review, proceedings. Only such terrors in the judgment/order would justify review, which are self‑evident, found floating on the surface, are discoverable without much deliberations, and have a material bearing on the final result of the case.
"5. The precise submission of the learned counsel for Mohtarma Benazir Bhutto and Senator Asif Ali Zardari, is that the question raised in the petitions for review are in the nature of rehearing of the petitions for leave to appeal, which could not be granted on grounds urged by the learned Attorney‑General.
The fact of above review petitions depends on the scope and applicability of Order XXVI, Rule 1, the Supreme Court Rules, 1980 (hereinafter referred to as the Rules). Under Rule 1 above, the power of review is to be exercised in a criminal proceedings on the ground of an. error apparent on the face of the record' and in a civil proceedings on ground similar to those. mentioned in Order XLVII, Rule I of the C.P.C. Under the latter provision, the power of review can also be exercised if there is a mistake or 'error apparent on the face of the record', apart from other grounds mentioned in Order XLVII, Rule 1 of the C.P.C.
The question which needs examination is as to what is the scope of the phrase 'a mistake/error on the face of the record'; and what is the scope and nature of the proceedings intended for the discovery and correction of such an error.
The phrase 'error apparent on the face of the record' and the scope au ' nature of the review proceedings are well‑settled. Clearly, the error contemplated under Order XXVI of the Rules, is an error so manifest, so clear, that no Court can permit such an error to remain on record. Such an error is not forthcoming on the record in the instant case. The State cannot, therefore, be permitted to re‑argue the petitions for leave
to appeal in the garb of review petition in the absence of any errors apparent on the face of the record, which is lacking here. To permit a review on the ground of incorrectness would amount to granting the C Apex Court the jurisdiction to hear appeal against its own judgment. Such a course is neither contemplated under the Constitution nor the Rules."
.... ...that I am unable to share the observations of my loathed brother that the averments made in various newspapers/press reports could be considered as proof of extra judicial killing as well as other grounds in the dissolution order, I am recording my opinion separately in support of the short order, dated 29th January, 1997 dismissing the petition against the dissolution of National Assembly, The material including newspaper clippings etc., relied upon by the President in dissolving the Assembly is, of course, relevant and can be taken into consideration as admissible material on the basis of which a person of ordinary prudence would conclude that the matters and events narrated therein did occur but not a strict proof of the matters stated therein as if adjudicated in a regular trial."
"I agree with the conclusions and observe that material on record in conjunction with each ground enumerated above accumulatively constituted adequate justification for the President to dissolve National Assembly; by virtue of Power contained in Article 58(2)(b) of the Constitution."
When faced with this, Mr. Aitzaz Ahsan argued that there are certain paragraphs in the judgment of Mr. Justice Sajjad Ali Shah. the then Hon'ble Chief Justice at pages 465, 477, 492, 495, 501, 502, 508. 509, 511, 512, 532, 533 and 539, wherein findings had been recorded against the petitioner in a summary manner, as if the petitioner was on trial; and m the judgment of the Mr. Justice Saleem Akhtar, J. (as he then was), at pages 613, 635 and 636, findings have been recorded that have tendency to have effect beyond mere issue of the dissolution order under Article 58(2)(b) of the Constitution. He prayed that the above findings should not be considered as proof of the allegations in any other judicial forum.
When confronted with this, Ch. Muhammad Farooq, the learned Attorney‑General frankly stated that the observations made by the then Hon'ble Chief Justice Mr.Justce Sajjad Ali Shah and Mr. Justice Saleem Akhtar (as he then was), were based on tentative appraisal of the material produced before the Court with reference to upholding the order of dissolution as well as the grounds specified under Article 58(2)(b) of the Constitution and not beyond that.
Mr. Aitzaz Ahsan is satisfied with the above statement. Also refer Khalid Malik and others v. Federation of Pakistan and others PLD 1991 Kar. 1, wherein Saiduzzaman Siddiqui (Acting C.J. as he then was) observed:‑‑
"It is not permissible in these proceedings to investigate the correctness or otherwise of the assertion made on the basis of the above material as it is outside the scope of the power of judicial review but this much can be safely said that the grounds of horse‑trading and corrupt practices of the House referred by the President in the dissolution order finds full support from the above material and bear reasonable nexus to the conditions prescribed under Article 58(2)(b) of the Constitution. "
In order to remove any doubt, we hereby clarify that the observations made in the impugned short order/judgment referred to above, are restricted, in their application, to the proceedings under Article 184 of the Constitution for the purposes of Article 58(2)(b) alone and are not to be treated as proof of the charges for any other purpose.
With the above observation, the review petition is dismissed.
M.B.A./B‑41/S Order accordingly.
P L D 2000 Supreme Court 84
Present: Saiduzzaman Siddiqui, C.J., Irshad Hasan Khan, Muhammad Bashir Jehangiri, Nasir Aslam Zahid and Munawar Ahmed Mirza, JJ
AL‑JEHAD TRUST‑through Raeesul Mujahidin Habib‑ul‑Wah‑ab‑ul‑Khairi‑‑‑Petitioner
versus
THE PRESIDENT OF PAKISTAN and others‑‑‑Respondents
Constitutional Petition No.6 of 1996, decided on 26th October, 1999.
(Petition under Article 184(3) of the Constitution of the Islamic Republic of Pakistan)
(a) Constitution of Pakistan (1973)‑‑‑
‑‑‑‑Art. 184(3)‑‑‑Constitutional petition before Supreme Court under Art. 184(3) of Constitution ‑‑‑Maintainability‑‑‑Direct petition under Art.184(3) of the Constitution is maintainable if the Supreme Court considers. that a question ok public importance with reference to the enforcement of any of the Fundamental Rights conferred by Chap. 1 of Part II of the Constitution is involved‑‑‑If the petitioner succeeds in establishing breach of any of the Fundamental Rights involving a question of "public importance", he is entitled to the appropriate relief.
(b) Constitution of Pakistan (1973)‑‑‑
‑‑‑‑Art. 184(3)‑‑‑Constitutional petition before Supreme Court under Art. 1840) of the Constitution‑‑‑Maintainability‑‑‑Allegations levelled in the petition that religious elements in the army. were being victimized, were too vague and had been expressed in general terms not supported by any cogent material on record and even during the course of arguments, petitioner had failed to state with particularity the relief sought by him with reference to violation of any fraction of the Fundamental Rights‑‑‑Pleas raised in the petition being of academic nature based on vague, bald and general allegations, no writ could be issued on the basis thereof.
In the present case the allegations levelled in the petition that religious elements in the Army were being victimized were too vague and had been expressed in general terms not supported by any cogent material on record. It is true, that while considering the question of cause of action, the Court should apply its 'Mind to the facts given in the petition, and even if there is any vagueness about the pleadings, the party can take appropriate steps with permission of the Court to remove the vagueness. This fact simpliciter was not enough to reject a plaint or a petition: In .the present case, however, even during the course of arguments, the petitioner had failed to state with particularity the relief sought by him with reference to violation of any fraction of the Fundamental Rights.
Pleas raised is the petition were of academic nature based on vague, bald and general allegations, on the basis whereof no writ can be issued.
(c) Constitution of Pakistan (1973)‑‑‑
‑‑‑‑Arts. 2 & 31‑‑‑Islam to be State religion‑‑‑Islamic way of life‑‑‑Officers and men in the Armed Forces are afforded full opportunity to lead their lives in accordance with the teachings and requirements of Islam as set out in the Holy Qur'an and Sunnah‑‑‑No order has been passed by the Government/armed forces and/or policy decisions taken by either of them, not to follow the teachings of Islam.
The officers and men in the Armed Forces are afforded full opportunity to lead their lives in accordance with the teachings and requirements of Islam as set‑out in the Holy Qur'an and Sunnah. Islam is the State religion of Pakistan as envisaged by Article 2 of the Constitution. Islam is the basis of a complete code of life not for the individuals alone but for the entire humanity. It makes adequate provisions for every human being to order his life in accordance with the fundamental principles and basic concepts of Islam. It does explain the methodology as well as the means which the individual or the Government should adopt. It is also one of the principles of policy enshrined in the Constitution vide Article 31 of the Constitution which enjoins that steps shall be taken to enable the Muslims of Pakistan, individually and collectively, to order their lives to accordance with the fundamental principles and basic concepts of Islam and to provide facilities whereby they may be enabled to understand the meaning of life according to the Holy Qur'an and Sunnah. No order has been passed by the Government/Armed Force and/or policy decisions taken by either of them not to follow the teachings of Islam.
(d) Constitution of Pakistan (1973)‑
‑‑‑‑Art. 184(3)‑‑‑Pakistan Army Act (XXXIX of 1952), S.84(a)‑‑‑Constitutional petition before Supreme Court under Art.184(3) of the Constitution‑‑?Maintainability‑‑‑Petition when read as a whole showed that real grievance of the petitioner related to the holding of trial and the procedure adopted by the Field General Court Martial under S.84(a), Pakistan Army Act, 1952‑‑?Procedure adopted in the trial was challenged before Supreme Court in a petition under Art. 184(3) of the Constitution which was dismissed on the ground that no question of public importance conferred by Arts. 9, 10 & 14 of the Constitution was involved‑‑‑Petitioner, in circumstances, could not be allowed to re‑argue the same matter by adding a few additional grounds.
Mrs. Shahida Zahir Abbasi end 4 others v. President of Pakistan and others PLD 1996 SC 632 ref. '
(e) Constitution of Pakistan (1973)‑
‑‑‑‑Art, 184(3)‑‑‑Constitutional petition before Supreme Court under Art.184(3), of the Constitution‑‑‑Cause of action‑‑‑Vagueness in pleadings ‑‑‑Remedy‑‑?While considering the question of cause of action, Court has to apply its mind to the facts given in the petition and even if there is any vagueness about the pleadings. the party can take appropriate steps with permission of the Court to remove the vagueness‑‑‑Such tact simpliciter is not enough to reject a plaint or a petition.
Petitioner in person.
Raja A. Ghafoor, Advocate‑on‑Record (absent) for Respondents.
Date of hearing: 26th October, 1999.
JUDGMENT
IRSHAD HASAN KHAN, J.‑ This petition under Article 184(3) of the Constitution of the Islamic Republic of Pakistan, 1973 (hereinafter referred to as the Constitution), inter alia, calls in question the legality of proceedings of the Field‑General Court Martial of the then Major‑General Zahir‑ul‑Islam Abbasi. The reliefs prayed for read as under:
3.???????? It is true, that a direct petition under Article 184(3) of the Constitution is maintainable, if this Court considers that a question of public importance with reference to the enforcement of any of the Fundamental Rights conferred by A Chapter 1 of Part‑I1 of the Constitution is involved. If a petitioner succeeds in establishing breach of any of the Fundamental Rights involving a question of "public importance", he is certainly entitled to the appropriate relief. .
4.???????? The allegations levelled in the petition that religious elements in the Army are being victimized are too vague and have been expressed in general terms not supported by any cogent material on record. It is true, that while considering the question of cause of action, the Court should apply its mind to the facts given in the petition, and even if there is any vagueness about the s pleadings, the party can take appropriate steps with permission of the Court to remove the vagueness. This fact simpliciter is not enough to reject a plaint or a petition. In the instant case, however, even during the course of arguments, the petitioner has failed to state with particularity the relief sought by him with reference to violation of any fraction of the Fundamental Rights.
There is no force in the plea of the petitioner that the officers and men in the , Armed Forces are not afforded full opportunity to lead their lives in accordance with the teachings and requirements of Islam as set‑out in the Holy Qur'an and Sunnah. Islam is the State religion of Pakistan as envisaged by Article 2 of the Constitution: Islam is the basis of a complete code of life not for the individuals alone but for the entire humanity. It makes adequate provisions for every human being to order his life in accordance with the fundamental principles and basic concepts of Islam. It does explain the methodology as well as the means which the individual or the Government should adopt. It is also one of the principles of policy enshrined in the Constitution vide Article 31 of the Constitution which enjoins that steps shall be taken to enable the Muslims of Pakistan, individually and collectively, to order their lives in accordance with I the fundamental principles and basic concepts of Islam and to provide facilities whereby they may be enabled to understand the meaning of lire according to the Holy Qur'an and Sunnah. There is nothing on record to show that any order has been passed by the Government/Armed Force and/or policy decisions taken by IC either of them not to follow the teachings of Islam.
The petition when read as a whole shows that real grievance of the petitioner relates to the holding of trial and the procedure adopted by the Field General Court Martial at Attock under section 84(a) of the Pakistan Army Act; by the Commander Rawalpindi Logistics Area in respect of the trial of then Major‑General Zahirul Islam Abbasi and others inter alia on the allegation that they conspired to wage war against Pakistan so as to overthrow the Federal Government of Pakistan by means of criminal force. The holding of the aforesaid trial and the procedure adopted therein was challenged before this Court under Article 184(3) of the Constitution, but the same was dismissed by majority of two to one on the ground that no question of public importance conferred by Articles 9, 10 and 14 of the Constitution was involved. Refer Mrs. Shahida Zahir Abbasi and 4 others v. President of Pakistan and others (PLD ..?1996 SC 632). In the above judgment the scope of Article 184(3) of the Constitution was also examined with reference to exhaustive case‑law on the subject. Review Petitions bearing Nos.50, 51 and 52 of 1996, filed against the said judgment were also dismissed by this Court. The petitioner, therefore, cannot be allowed to re‑argue the same matter by adding few additional grounds. Even otherwise, the pleas raised in the petition are of academic nature based on vague, bald and general allegations, on the basis whereof no writ can be issued.
Resultantly, this is not a fit case for entertaining a direct petition under Article 184(3) of the Constitution, which is hereby dismissed.
M.B.A./A‑203/S ???????????????????????????????????????????????????????????????????????????????????????????????????????? Petition dismissed.
P L D 2000 Supreme Court 89
Present: Khalil‑ur‑Rehman Khan, Munir A. Sheikh and Wajihuddin Ahmed, JJ
MUHAMMAD SAFDAR and 4 others‑‑‑Appellants
versus
ASHIQ HUSSAIN and 20 others‑‑‑Respondents . .
Civil Appeal No.9 of 1995, decided on 5th October, 1999.
(On appeal from the judgment of Lahore High Court, Rawalpindi Bench, Rawalpindi dated 1‑6‑1994 passed in R.S.A. No.215 of 1973).
Civil Procedure Code (V of 1908)‑‑‑
‑‑‑‑0. I, R. 9 & O. XXII, R.,1‑‑‑Abatement.of suit‑‑‑Suit against decree passed in terms of compromise between the parties‑‑‑Plaintiffs failed to make application to bring legal representatives of deceased defendant/appellant on record‑‑‑Deceased defendant/appellant had acknowledged in his written statement in the suit the abandonment by him of his rights in favour of the other ,6o‑appellants in the appeal in which compromise was effected which was under challenge in the suit and had raised no objection against the said compromise qua the said abandonment on his part‑‑‑Transfer of land in dispute by deceased/defendant through the said compromise was not made in favour of deceased/appellant or any of his co‑appellants‑‑‑Death of appellant and non impleadment of his remaining legal representatives in the suit, therefore, could not be said to have resulted in creating any legal defect in the constitution of the suit‑‑‑Courts, in circumstances, while holding that the suit had abated as a whole had not applied the law correctly to the facts established on record in the case which resulted in refusal to exercise jurisdiction to decide the suit on merits and on this short ground, impugned judgments were liable to set aside‑‑‑Case being a fit one for remand, Supreme Court, while condoning the delay, in making the said application remanded the case with direction that suit should be decided on merits in accordance with law within six months from the receipt of certified copy of the judgment of the Supreme Court.
Gul Zarin Kiani, Advocate Supreme Court and Ch. Akhtar Ali, Advocate‑on‑Record for Appellants.
Khawaja Muhammad Farooq, Advocate Supreme Court for Respondents Nos. 1, 3, 4, 6, 8, 9, 11, 12, 15, 17 and 26
Date of hearing: 5th October, 1999.
JUDGMENT
MUNIR A. SHEIKH, J.‑‑‑This appeal by leave of the Court is directed against' the judgment dated 1‑6‑1994 of the Lahore High Court, Rawalpindi Bench through which the appeal filed by the appellants against the judgment dated 8‑2‑1973 of the learned Additional District Judge dismissing their appeal against the judgment dated 24‑7‑1972 of the trial Court by which their suit was held to have abated in toto and dismissed as such, has been dismissed.
It may be mentioned here that according to the learned counsel for both the parties, the heirs of Lai Khan were his widow Bholi, Sakina daughter and Haq Nawaz son.
The view taken by the learned Single Judge of the High Court in the impugned judgment was that since legal representatives of Lal Khan had not been brought on record within the prescribed period of limitation, therefore, for want of necessary parties in the suit, the suit had abated as a whole. It appears that the said view was taken on the assumption that interest of La. Khan as to land could not be separated from the rights claimed by Muhammad Khan in relation to the compromise decree challenged in the suit.
We have gone through the terms of the compromise and find that Bholi widow of Lal Khan who is one of his legal representatives had already been impleaded as one of the defendants in her own rights.
The question which arises for determination was whether in view of the terms of the compromise on the basis of which decree challenged in the suit had been passed and the failure of the plaintiffs to make application to bring legal A representatives on record of Lal Khan, defendant had resulted in abatement of the suit partially or as a whole or the same did not abate at all. This question should have been decided with reference to the terms of the compromise, the rights which plaintiff claimed in the suit in relation thereto considering the pleas raised in the suit and not in isolation thereof.
We have gone through the terms of compromise which have been reproduced in extenso in the judgment/decree dated 15‑11‑1967 of the learned District Judge which if read as a whole, the same can safely be construed to be a composite document effecting compromise between Lal Khan on the one bane and his co‑appellants on the other hand as regards abandonment of their rights in the land as collateral of Kala Khan according to which Lal Khan had abandoned his rights in favour of the other appellants. The other part relates to settlement between Muhammad Khan deceased plaintiff and the donees according to which he surrendered some of his land in their favour. In the suit, the plaintiff had challenged the compromise between himself and the donees as regards transfer and surrender of his land in their favour. Learned counsel for the respondents appearing before us when questioned frankly conceded after going through the said compromise deed that Muhammad Khan through it did not surrender any land and his rights therein in favour of either Lal, Khan or his other co-appellants. As has already been observed, even Lal Khan etc., did not transfer their rights in favour of his other co‑appellants rather they abandoned their rights in their favour. Lal Khan as has already been seen filed written statement in the present suit wherein he and the other appellants did not challenge the terms of compromise so far as. it related to settlement and adjustment of their shares in the land inter se. In the suit, the plaintiff challenged the said compromise decree so far it related to transfer of his share in the land in favour of the donees, therefore, looked from this angle, the suit did not at all abate on the death of Lal Khan qua the rights of the plaintiff and relief claimed in the suit. If the suit had proceeded and decided on merits, the same would not have effected the settlement between Lal Khan and his co‑appellants about their shares in the land inter se about which they had admitted in this suit that they had abandoned their rights in favour of other appellants.
Learned counsel for the appellants maintained that' since Lal Khan had transferred his rights in the land in favour of other co‑appellants according to the said compromise decree and the transferees from him being already parties in the suit, therefore, his death could not be said to have resulted in the abatement of the suit as the said transferees could very well be considered as the legal representatives within the meaning of section 2(11), C.P.C., therefore, his estate was duly represented by them. In support of this contention, he relied upon a number of reported judgments. we need not dilate upon this aspect of the case for the appeal is otherwise liable to be accepted on other grounds, therefore, we are not examining the rule laid down in the said reported judgments.
As has been. observed above, Lal Khan deceased having acknowledged in the present suit in his written statement the abandonment by him of his rights in favour of the other co‑appellants in the appeal in which compromise was effected which was under challenge in the present suit and he also did not raise any objection against the said compromise qua the said abandonment on his part and that so far as transfer of land by deceased Muhammad Khan through the said compromise was not made in favour of Lal Khan or any of his co‑appellants, therefore, the death of Lal Khan and non‑impleadment of his remaining legal representatives in the suit could not be held to have resulted in creating any legal defect in the Constitution of the suit as regards rights claimed by Muhammad Khan deceased and the persons i.e., the donees to whom he allegedly transferred the land who were already parties in the suit, therefore, the question of legality of compromise which was challenged to the extent of Muhammad Khan deceased's share in the land in favour of the said donees could have been adjudicated upon without affecting the settlement between Lai Khan. deceased and the co‑appellants as regards adjustment and settlement of their shares inter se. In this view of the matter, while holding that the suit had abated as a whole, the Courts below did not apply the law correctly to the facts established on the record in this case which resulted in refusal to exercise jurisdiction to decide the suit on merits and on this short ground, the impugned judgments are liable to be set aside.
Learned counsel for the respondents submitted that in this appeal, Mst. Ghori daughter of Makhu, respondent No. 14, Mst. Bani daughter of Abdul Ghani/respondent No. 18 who was son of Muhammad Wali and Inayat Bibi daughter of Muhammad Wali, respondent No. 19 died but application for bringing their legal representatives on the record was made after the expiry of period of limitation prescribed under the Supreme Court Rules, as such, the appeal should be dismissed.
Learned counsel for the appellants submitted that Civil Procedure Code and its technicalities are not applicable to proceedings before this Court. He submitted that this Court is vested with ample discretion in order to do complete justice to condone the delay in 'making applications prescribed under the rules.
10‑A. As we have observed, the suit was dismissed by the trial Court as having abated without trial on merits on an erroneous view of law as regards abatement of the suits and that the law favours adjudication of the rights of the parties on merits as raised in the suit, therefore, we are not inclined to exercise discretion in favour of the respondents by dismissing this appeal merely on this ground, for some of the legal representatives of these deceased respondents were already on the record and order dated 16‑6‑1999 of this Court shows that the information as regards death of these respondents was laid before this Court on that date when the appeal came up for hearing on which date the appellants came to know and the learned counsel for the respondents was directed to furnish full particulars of their legal representatives which according to the appellants were furnished on 9‑8‑1999 and application for bringing their legal representatives was made on 21‑8‑1999. Learned counsel for the respondents, however, disputed the correctness of the plea raised by the learned counsel for the appellants that information as regards full particulars of the legal representatives of deceased respondents was made as late as 9‑8‑1999. This plea has been raised in the application made by the learned counsel for the appellants to bring their legal representatives on the record and uptil today there is no counter‑affidavit to deny the plea. Apart from this fact, we are not inclined to enter into any controversy on this, question as we consider it is a fit case for remand as we feel the suit should be decided on merits, we condone the delay in making the said applications in exercise of discretion vested in this Court under the rules.
M.B.A./M‑397/S Appeal accepted.
P L D 2000 Supreme Court 94
Present: Saiduzzaman Siddiqui, CJ., Nasir Aslam Zahid and Mamoon Kazi, JJ
KARACHI ELECTRIC SUPPLY CORPORATION LTD. ‑‑‑Appellant
versus
LAWARI and 4 others‑‑‑Respondents
Civil Appeal No.720 of 1994, decided on 22nd October, 1999.
(On appeal from the judgment dated 12‑1‑1994 of the Balochistan High Court, passed in R.F.A. No.36 of 1992).
(a) Limitation Act (IX of 1908)‑‑‑
‑‑‑‑Ss. 14 & 15‑‑‑Delay in filing appeal ‑‑‑Condonation of delay‑‑‑Filing of appeal in a wrong Court on account of mistaken advice tendered by the counsel‑‑.When constitutes a "sufficient cause"‑‑‑Principles‑‑‑Duo diligence‑‑Criteria.
Notwithstanding the fact that section 14 of the Limitation Act, 1908 in terms does not apply to proceedings of an appeal, if the appellant is able to establish that he followed the remedy before a wrong forum in good faith the Court may condone such delay in filing of the appeal treating it as sufficient cause under section 5 of the Limitation Act. What constitutes "sufficient cause" in such cases would depend on the facts of each case.
Diligence is a state of human conduct. What should be the standard for assessing the behaviour of an appellant to style him as diligent. Because of fluidity of the notion of diligence, it is difficult to set up a precise yardstick. Whether or not litigant has acted diligently and with care, would differ from case to case. Speaking broadly, a person may be said to have acted diligently, when he has informed. himself of all relevant factors taken all obvious steps and precautions, characterized by ‑a degree of effort, as in a given situation, a reasonable person would do. But the epithet of reasonable opens wide the measure of application of this yardstick, on the factual plane, for the word "reasonable.", is not susceptible of any precise definition. Etymologically, it signifies. according to reason, which expression itself is open to difference of opinion. Whether or not a person has acted diligently in ultimate analysis, would depend on the circumstances of each case and cannot be determined on the foundation of any judicial syllogism. The criterion of "due diligence" for' enlargement of time is prescribed by section 14 of the Limitation Act, which upon its terms is applied only to the suits and applications and not to the appeals. On the other hand section 5 is applicable to the appeals but it does not apply to suits. The question of condonation of delay, therefore, has to be examined on the basis of section 5 and not section 14 of the Limitation Act. Not unoften while examining the question of condonation of delay, in filing the appeal, the Courts have been invoking the principles underlying section 14 of the Act. It is, however, to be remembered that expressions "due diligence" and "good faith" appearing in section 14 do not figure in section 5. The condition prescribed in the latter section for its applicability is sufficient cause but what is sufficient cause is not capable of connotation, with exactitude and would differ from case to case. Filing of appeal in a wrong Court on account of mistaken advice tendered by the counsel, by itself, would not attract section 5, but when the litigant and the counsel have acted with due care and caution and their conduct does not smack of negligence, the institution of the appeal in the wrong forum may constitute a 'sufficient case' within the meaning of section 5 for condonation of the delay.
Filing, of an appeal in a wrong Court on account of mistaken advice tendered by the counsel canvassed on behalf of the appellant for condonation of delay by itself would not attract section 5 of the Limitation Act, but when the litigant and the counsel have acted with due care and caution and their conduct does not smack of negligence, the institution of the appeal in the wrong forum may constitute sufficient cause within the meaning of section 5 for condonation of delay.
Despite section 14 of the Limitation Act, 1908 if appellant is able to establish that he followed the remedy before a wrong forum in good faith with due care and caution, the Court may condone such delay in filing of the appeal treating it as sufficient cause under section 5 of the Limitation Act, but filing of an appeal in a wrong Court on account of mistaken advice tendered by the counsel for condonation of delay by itself would not attract section 5.
Abdul Wahid v. Sirajuddin 1998 SCMR 2296; Sherin v. Fazal Muhammad 1995 SCMR 584 and Abdul Ghani v. Ghulam Sarwar PLD 1997 SC 102 quoted.
(b) Limitation Act (IX of 1908)‑‑‑
‑‑‑‑Ss. 14 & 5‑‑‑Delay in filing appeal ‑‑‑Condonation of delay‑‑‑District Judge and its office in entertaining the appeals, on both occasions i.e. in the earlier round when the appeal was filed by the respondents and then when the appeal was filed by the appellant and District Judge deciding the appeals on both occasions on merits and not noting or raising the 'question of maintainability, and respondents' conduct on both occasions, were also factors which led the appellant in filing the appeal before the District Judge and pursuing the same there‑‑‑Case of "sufficient, cause" as required in S.5, Limitation Act, 1908, held, had been made out, in circumstances, and the appeal filed by the appellant before the High Court was not liable to be rejected on the ground of limitation.
A.S. K. Ghori, Advocate‑on‑Record for Appellant.
Sh. Riazul Haq, Advocate Supreme Court and Ejaz Muhammad Khan, Advocate‑on‑Record (absent) for Respondents Nos. 1 to 4 (Private Respondents).
Raja Abdul Ghafoor, Advocate‑on‑Record for Respondent No‑5 (Official Respondent).
Date of hearing: 22nd October, 1999.
JUDGMENT
NASIR ASLAM ZAHID, J.‑‑‑The above appeal filed by Karachi Electric Supply Corporation Limited is directed against the judgment dated 12‑1‑1994 of the Balochistan High Court dismissing Regular First Appeal of the appellant on the ground of limitation. Merits of the appeal were not considered by the High Court. The leave granting order dated 3‑8‑1994 reads as under:‑‑ '
"In compliance with the order of this Court the petitioner has deposited a sum of Rs.11,75,739.50 (decretal amount) in the trial Court, as stated by his learned counsel.
Leave to appeal is granted to examine inter alia, as to whether or not there was/is sufficient cause to condone the delay in filing the appeal before the High Court . "
We have heard the arguments of Mr. A.S.K. Ghori, learned Advocate‑on‑Record for the appellant and Raja Abdul Ghafoor, learned Advocate‑on‑Record for Government of Balochistan, respondent No.5. For private respondents Nos. l to 4 Sh. Riazul Haq, Advocate Supreme Court, has appeared but has stated no instructions. Mr. Ejaz Muhammad Khan, Advocate‑on‑Record for the private respondents is absent. We have gone through the record. The facts are stated in the impugned judgment of the High Court as follows:
"In brief facts giving rise to instant appeal are that respondents I to 4 being owners of the land bearing Khasra Nos.36, 37 and 38 measuring 5‑0‑2 acres situated in Mouza Baroot, Tehsil Hub, District Lasbella claimed compensation against the appellant and respondent No.5 to the tune of Rs.11,75,739.50. It was the case of respondents that in the year 1976 Government of Balochistan illegally allotted the property owned by them to appellant for the construction of Grid Station at Hub at the cost of Rs.24,260.50 Later on the land was illegally treated to be owned by the State. As such its price was also received by the Provincial Government. However, they approached the competent forums and ultimately succeeded in getting reversed entries on their name. As such the amount of price so fixed by the Government was paid to them which they received under protest. It was further alleged that the amount received by them was not in accordance to the prevalent market price, thus, they are entitled for the balance amount i.e. Rs.11,75,739.50. Therefore, to recover the said amount suit was filed in the Court of Civil Judge at Hub in the month of November, 1982. Appellant contested the suit and repudiating the claim of respondents on merits also objected its maintainability being barred by time. Government of Balochistan filed a separate written statement. The learned trial Court framed issue and called upon the parties to adduce evidence in support of their respective contentions. During the pendency of the suit appellant filed an application for rejection of the plaint under Order 7, Rule 11, C.P.C. read with section 3 of the Limitation Act. Application so filed was allowed by the Civil Judge vide order/decree, dated 24th August, 1985. The respondents challenged order of Civil Judge before the District Judge, Khuzdar in Civil Appeal No.29 of 1986 which was allowed on 7th February, 1987. The case was sent back to the lower Court with observation for framing a preliminary issue and providing an opportunity to the parties to adduce their respective evidence.
On remand the learned trial Court recorded evidence of the parties and by means of order, dated 9th September, 1991 passed decree in terms of the prayer clause of the plaint. Although in the plaint the pecuniary valuation of the suit has been fixed more than Rs.50,000 but appellant instead of approaching the High Court filed appeal before the District Judge, Khuzdar which was registered on 29th October, 1991. Accordingly vide final order dated 15th July, 1992 appeal was turned down by the District Judge, Khuzdar. Later on a Civil Revision No.201 of 1992 was preferred before this Court which was partially ‑allowed vide order, dated 24th September, 1992. Relevant para. wherefrom is reproduced hereinbelow:‑‑
'The provisions of law clearly envisage that first appeal regarding case where subject‑matter is beyond Rs.50,000 shall lie before High Court. Thus in the instant case learned District Judge had absolutely no jurisdiction to entertain the appeal. It is quite obvious that all the proceedings drawn before the learned District Judge, Khuzdar commencing from institution of appeal and culminating in judgment dated 15‑7‑1992 are coram non judice.
Resultantly petition is partly accepted judgment and decree dated 15‑7‑1992 passed by learned District Judge, Khuzdar is set aside and memo. of appeal filed by petitioners be returned subject to all just exceptions, for presentation before Court of competent jurisdiction. Petition disposed of in the above terms.' .
It is stated on behalf of the appellant that on having obtained copy of the above order appellant approached the District Judge, Khuzdar for the return of the memo. of appeal, who declined to do the needful Therefore, duplicate copy .available with the appellant's counsel alongwith requisite court‑fee was submitted before this Court with the request that it be treated memo of the appeal filed by the appellant before District Judge."
In the circumstances it was submitted by Mr. Ghori, learned counsel for the appellant that sufficient grounds were available on record to condone the delay in the filing/presentation of the appeal before the High Court.
Raja Abdul Ghafoor learned counsel appearing on behalf of the official respondent, Government of Balochistan; supported the contentions advanced on behalf of the appellant.
Sh. Riazul Haq, learned Advocate Supreme Court appearing for the private respondents stated no instructions and submitted that the private respondents have not been in contact for the last over 4 years. None of the private respondents is present.
Contention also raised in the High Court on behalf of the appellant was that the judgment of the trial Court dated 9‑9‑1991 was void having been passed without jurisdiction and, therefore, the appeal was not liable to be dismissed on the ground of limitation. This contention was not accepted by the High Court on the ground that such objection had not been taken at the relevant time either before the District Judge or on remand before the trial Court from which it was
apparent that the remand judgment dated 7‑2‑1987 of the District Judge in the earlier round had been accepted by the trial Court.
"5. Any appeal or application for a revision or a review of judgment or for leave to appeal or any other application to which this section may be made applicable by or under any enactment for the time being in force may be admitted after the period of limitation prescribed, therefore. When the appellant or applicant satisfies the Court that he had sufficient cause for not preferring the appeal or making the application within such period:
Explanation.‑‑The fact that the appellant or applicant was misled by any order, practice or judgment of the High Court in ascertaining or computing the prescribed period of limitation may be sufficient cause within the meaning of this section.
..
..
..
(2) In computing the period of limitation prescribed for any application, the time during which the applicant has been prosecuting with due diligence another civil proceeding, whether in a Court of first instance or in a Court of appeal, against the same party for the same relief shall be excluded, where such proceeding is prosecuted in good faith in a Court which, from defect of jurisdiction, or other cause of alike nature, is unable to entertain it.
Explanation I.‑‑In excluding the time during which a former suit or application was pending, the day on which that suit or application was instituted or made. and‑ the day on which the proceedings therein ended shall both be counted.
Explanation II.‑‑For the purposes of this section, a plaintiff or an applicant resisting an appeal shall be deemed to be prosecuting a proceeding.
Explanation III.‑‑‑For the purposes of this section misjoinder of parties or of causes of action shall be deemed to be a cause of a like nature with defect of jurisdiction."
On the question of applicability of sections 5 and 14 of the Limitation Act, in a recent decision of this Court in the case of Abdul Wahid v. Sirajuddin 1998 SCMR 2296 after considering the earlier judgments, this Court took the view that, notwithstanding the fact that section 14 of the Limitation Act in terms does not apply to proceedings of an appeal, if the appellant is able to establish that he followed the remedy before a wrong forum in good faith the Court may condone such delay in filing of the appeal treating it as sufficient cause under section 5 of the Limitation Act. It was further observed in the cited judgment that what constitutes "sufficient cause" in such cases would depend on the facts of each case. Reference was made to the case of Sherin v. Fazal Muhammad (1995 SCMR 584) where this Court came to the following conclusions:‑‑
"4. The appellants' case is that they entrusted the case to their learned counsel, who after completion of the file, instituted the same in the Court of the learned District Judge; that the appellants themselves were not posted with the knowledge of the provisions of law as to the pecuniary jurisdiction of the District Judge to entertain the appeal; and they wholly depended on their counsel. The, delay has been, thus, sought to be excused on the plea that the appeal was instituted in the District Court on the mistaken advice of the counsel. In order to plead that the later was not negligent, it has been asserted that the value of the suit for the purposes of the court‑fee and jurisdiction was neither incorporated in the decree sheet nor explicitly shown in the judgment of the trial Court. Conversely, the learned counsel for the respondents has dubbed it a case of gross negligence on the part of the appellants and their counsel and added that the mistaken advice of the counsel cannot furnish good ground for condonation of delay.
Diligence is a state of human conduct. What should be the standard for assessing the behaviour of an appellant to style him as diligent. Because of fluidity of the notion of diligence, it is difficult to set up a precise yardstick. Whether or not litigant has acted diligently and with care, would differ from case to case. Speaking broadly, a person may be said to have acted diligently, when he has informed, himself of all relevant factors taken all obvious steps and precautions, characterized by a degree of effort, as in a given situation, a reasonable person would do. But, the epithet of reasonable, opens wide the measure of application of this yardstick, on the factual plane, for the word 'reasonable' is not susceptible of any precise definition. Etymologically, it signifies according to reason, which expression itself is open to difference of opinion. Whether or not a person has acted diligently in ultimate analysis, would depend on the circumstances of each case and cannot be determined on the foundation of any judicial syllogism.
The criterion of due diligence for enlargement of time is prescribed by section 14 of the Limitation Act, which upon its terms applied only to the suits and applications and not to the appeals. On the other hand section 5 is applicable to the appeals but it does not apply to suits. The question of condonation of delay, therefore, has been examined on the basis of section 5 and not section 14 of the Limitation Act. Not unoften while examining the question of condonation of delay, in filing the appeal, the Courts have been invoking the principles underlying' section 14 of the Act. The High Court has declined to condone the delay entirely on the touchstone of section 14. It is, however, to be remembered that expressions 'due diligence' and 'good faith' appearing in section 14 do not figure in section 5. The condition prescribed in the latter section for its applicability is 'sufficient cause' but what is sufficient cause is. not capable of connotation, with exactitude and would differ from case to case. We may observe that filing of appeal in a wrong Court on account of mistaken advice tendered by the counsel canvassed on behalf of the appellants for condonation of delay by itself would not attract section 5 but when the litigant and the counsel have acted with due care and caution and their conduct does not smack of negligence, the institution of the appeal in the wrong forum may constitute a 'sufficient case' within the meaning of section 5 for condonation of the delay. "
This Court made it clear in the case of Sherin v. Fazal Muhammad (supra) that filing of an appeal in a wrong Court on account of mistaken advice tendered by the counsel canvassed on behalf of the appellant for condonation of delay by itself would not attract section 5 of the Limitation Act, but when the litigant and the counsel have acted with due care and caution and their conduct does not smack of negligence, the institution of the appeal in the wrong forum may constitute sufficient cause within the meaning of section 5 for condonation of delay.
In Abdul Wahid v. Sirajuddin (supra) for the contention that delay in filing the appeal could not be condoned for the reason that the appellant had been pursuing remedy in a wrong Court, relience had been placed on earlier judgments of this Court specially on Abdul Ghani v. Ghulam Sarwar (PLD 1997 SC 102) and an argument had been raised that the view taken in the cited case was in conflict with the view taken later in Sherin v. Fazal Muhammad (supra), but this Court in Abdul Wahid v. Sirajuddin (supra) did not agree observing as follows:‑‑
"However, after examining the ratio of decidendi of both cases, which we have reproduced, we are of the view that there is no conflict in the opinion expressed in the above two cases. "
The view taken by this Court that, despite section 14 of the Limitation Act, if appellant is able to establish' that he followed the remedy before a wrong forum in good faith with due care and caution, the Court may condone such delay in filing of the appeal treating it as sufficient cause under section 5 of the Limitation Act is confirmed, but we may also reiterate that filing of an appeal in a wrong Court on account of mistaken advice tendered by the counsel for condonation of delay by itself would not attract section 5 as held in Sherin v. Fazal Muhammad (supra).
It has to be considered in the present case whether the appellant filed the appeal before the District Judge only on the mistaken advice of the counsel or whether the appellant filed the appeal with due care and caution and their conduct does not smack of negligence. The facts and the entire background which led to the filing of the appeal before the District Judge by the appellant have been given earlier in this judgment. It may, however, be repeated that, in the first round, on their plaint being rejected under Order VII, Rule 11, C.P.C. read with section 3 of the Limitation Act, private respondents themselves filed an appeal before the District Judge which was entertained and decided on merits and the matter was remanded to the trial Court. Neither the Appellate Court nor its officers noted that the appeal had been filed before the wrong forum. The District Judge should have returned the appeal of the respondents for being presented before the competent appellate forum i.e. the High Court. This was not done. As observed, the appeal of the respondents was decided on merits and remanded to the trial Court. After remand, the trial Court proceeded with the suit of the respondents and decreed the same. This time appellant also filed the appeal before the District Judge. On this occasion also neither the office of the District Judge nor the District Judge raised any objection about the jurisdiction of the District judge to entertain the appeal; the District Judge proceeded to decide the appeal on merits. Even respondents did not raise any objection to the competency of the appeal before the District Judge. As noted, the appeal having been dismissed by the District Judge on merits, appellant filed a revision before the Balochistan High Court when, while disposing of the revision, for the first time it was held by the High Court that the appeal before the District Judge was not competent and it was directed that the memo. of revision be returned to the appellant for being filed before the competent forum'.
In the aforesaid admitted facts and circumstances, we are of the view that it is not a case where the appeal had been filed by the appellant before the District Judge only on account of mistaken advice of the counsel. Here the act and conduct of the District Judge and its office in entertaining the appeals on both occasions i.e. in the earlier round when the appeal was filed by the respondents and then when the appeal was filed by the appellant and District Judge deciding the appeals on both occasions on merits and not noting or raising the question of maintainability, and respondents' conduct on both occasions, are also factors which led the appellant in filing the appeal before the District Judge and pursuing the same there. In our view taking all the above facts and circumstances together, a case of sufficient cause as required in section 5 of the Limitation Act. had been made out and the appeal filed by the appellant before E the High Court was not liable to be rejected on the ground of limitation.
H.B.T./K‑49/S Order accordingly.
P L D 2000 Supreme Court 104
Present: Abdur Rehman Khan and Sh.Raiz Ahmed, JJ
FEDERATION OF PAKISTAN through
Secretary, Establishment Division, Government
of Pakistan, Islamabad and another‑‑‑Petitioners
versus
SALEEMULLAH KHAN‑‑‑Respondent
Civil Petition for Leave to Appeal Nos. 1393 and 1394 and Criminal Original Petitions Nos.68 and 69 of 1999, decided on 7th October, 1999.
(On appeal against the judgment dated 24‑7‑1999 of the Federal Service Tribunal, Islamabad in Appeals Nos.913‑R of 1998 and 173‑R of 1999).
(a) Civil service‑‑‑
‑‑‑‑Misconduct‑‑‑Removal from service‑‑‑Issuance of corrigendum converting removal from service into compulsory retirement without bringing the matter to the notice of Competent Authority‑‑‑Validity‑‑‑Held, after issuance of the notification removing the civil servant from service, Department had become functus officio‑‑‑No explanation having been offered for the issuance of the corrigendum, same was to be deemed to be null and void.
(b) Civil service‑‑‑
‑‑‑‑Misconduct‑‑‑Competent Authority had directed that civil servant was to be compulsorily retired but he was removed from service by a notification‑‑Validity‑Notification of civil servant's removal from service being violative of the directions of the Competent Authority would be deemed to be null and void.
(c) Government Servants (Efficiency and Discipline) Rules, 1973‑‑
‑‑‑‑Rr. 3 & 4(1)(b)(iii)‑‑‑Misconduct‑‑‑Removal from service‑‑‑Where nature of charges could not have been made basis for proceeding against the civil servant under the Government Servants (Efficiency and Discipline) Rules, 1973, proceedings taken against the civil servant were totally illegal and contrary to rules.
Mansoor Ahmed, Deputy Attorney‑General and Alamdar Raza, Advocate Supreme Court with Ch. Akhtar Ali, Advocate‑on‑Record for Petitioners.
Respondent in person.
Date of hearing: 7th October, 1999.
ORDER
SH. RIAZ AHMED, J.‑‑‑The Federation of Pakistan through Secretary, Establishment Division and the Secretary, Ministry of Interior, hereinafter called the petitioners, have filed above two petitions seeking leave to appeal against the judgment dated 24‑7‑1999 delivered by the Federal Service Tribunal whereby the appeals filed by the respondent Salimullah Khan were allowed and he was ordered .to be reinstated in service with effect from 15‑7‑1998 with all back benefits.
"That while posted as Inspector‑General (Prisons), N.‑W.F.P., Peshawar, you committed the following acts of misconduct and corruption:‑‑
(i) Illegally and without authorization collected Rs.96,400 from various Superintendents Jails and misappropriated this amount.
(ii) Imposed fee of Rs.2 for interview, with prisoners without authority and misappropriated the amount so collected.
(iii) Furnished a false certificate to the Home Department regarding no claim of medical charges by other staff.
(iv) Submitted and drew bogus T.A. bills amounting to Rs.20,800
(v) Attempted to misappropriate Government's funds worth Rs. one million released for the improvement of jail conditions.
(vi) As I.‑G. Prisons, indulged in extravagance in the use of official telephones and vehicles.
(vii) Asked Superintending Engineer, WAPDA to reverse the electricity meter at your residence.
(viii) stopped payment of a cheque for Rs.6,905 on account of electricity dues.
(ix) Made illegal appointments without observing codal formalities.
The respondent submitted reply to the charge‑sheet denying all the charges and, thus, a regular inquiry was conducted by Mr. Muhammad Javed Ashraf Hussain, Additional ‑ Secretary, Interior Division: On 9‑7‑1997 the Inquiry Officer submitted his report holding that the charge No. l had been partly proved to the extent of having collected Rs.96,400 from various Superintendents of Jails on the pretext of holding a conference on the Reforms and Rehabilitation of Prisoners, but the charge as to the misappropriation of any amount was not proved. In respect of charge No.2, the Inquiry Officer reported that the recovery of Rs.2 from each person desiring to meet a prisoner was within the knowledge of the Home Department, but its misappropriation by the respondent stood disproved. As regards charge No.3, it was observed that an attempt by the respondent to suppress truth regarding the medical bills of the staff and his own medical bills having been sanctioned within the available budget was made. but such attempt was aborted by the Home Department and in this regard a warning was issued to the respondent, but on a representation made by the respondent the said warning was set aside by the Chief Secretary to the Government of the N.W.F.P. Charge No.4 was reported not having been proved. Charge No.5 was considered by the Inquiry Officer as hypothetical as no expenditure had been incurred and the amount, thus, had lapsed. However, the respondent desired to include certain items towards the welfare of the prisoners and improvement of jail, but those proposals were not agreeable, hence question of misappropriation did riot at all arise. Charges Nos.6 and 7 were reported not having been proved and it was further opined by the Inquiry Officer that the charges were misplaced and the same should be dropped. In respect of charge No.8, the Inquiry Officer submitted that the matter was sub judice before the Ombudsman. Similarly, charge No.9 was also not proved. .
On the receipt of the inquiry report, the Secretary Interior (Authorised Officer) issued final show‑cause notice dated 15‑9‑1997 to the effect that on the basis of the inquiry report, it was proposed to impose upon the respondent major penalty of removal from service in terms of provisions of rules 3 and 4(1)(b)(iii) of the Government Servants (Efficiency ‑and Discipline) Rules, 1973. The respondent submitted his reply, but the competent Authority by means of the impugned notification dated 15‑7‑1998 imposed the penalty of removal from service with immediate effect. The said show‑cause notice also contained a provision that the inquiry had been conducted on nine charges and the respondent was found guilty by the Inquiry Officer on charges 1, 2 and 3 and the Authorised Officer had further found the respondent guilty of charges 2, 7 and 8. Aggrieved by the penalty imposed, on 12‑8‑1998 the respondent preferred departmental appeal, but the same having remained unresponded, the respondent filed Appeal No.913‑R of 1998 on 11‑11‑1998 before the Federal Service Tribunal. It so happened that on 29‑10‑1998 a corrigendum was issued and the penalty of removal from service was converted into compulsory retirement from service. Aggrieved by this order, the respondent preferred a separate Departmental Appeal on 26‑11‑1998, but no heed was paid to the same and thus the respondent filed another Appeal No. 173‑R of 1999 on 25‑2‑1999. Both these appeals were heard together and were allowed by the Tribunal as stated above.
Both the appeals were heard and vehemently contested by the petitioners. We have noticed that before the Tribunal after, it had reserved the judgment, a miscellaneous application was filed to hold an inquiry as to whether in fact the respondent had filed a Departmental Appeal so as to become eligible for invoking the jurisdiction of the Tribunal. In fact before the Tribunal the respondent had contended that before filing Appeal bearing No. 173‑R of 1999 assailing the corrigendum issued by the petitioners retiring the respondent from service, it had been contended by the respondent that he had filed Departmental Appeal and copy of the same had been delivered and a receipt from an official of the R & I Branch of the Interior Division had been obtained. On behalf of the petitioners it was contended that no such Departmental Appeal had been filed and therefore the appeal was incompetent. This objection was repelled by .the Tribunal and rightly so because in para. 11 of the memo. of Appeal No. 173‑R of 1.999 the respondent clearly stated that he filed a Departmental Appeal on 26‑11‑1998 against the aforesaid corrigendum through proper channel and a copy of the same was annexed with the memo. of appeal as Annexure 'C'. The Tribunal came to the conclusion that the said copy of the appeal had been received in the R & 1 Branch and an official had put signature on the same on 26‑11‑1998. As against this documentary, evidence. the petitioners, had no material to rebut it.. The Tribunal also rightly concluded that from the date of filing of the appeal on 25‑2‑1999 till hearing of the arguments on 20‑7‑1999, no effect was made by the petitioners to make any such application for holding of inquiry and no reason was forthcoming for such unexplained delay. Similarly while filing Appeal No.913‑R of 1998 assailing the removal from service the respondent had asserted that lie had filed the Departmental Appeal on 12‑8‑1998. The Tribunal was amazed to notice that in the parawise comments the petitioners took a preliminary objection to the effect that no appeal had been filed, but in para. 12 of the comments the petitioners stated that the respondent had preferred an appeal on 11‑8‑1998 impugning the Establishment Division's notification dated 15‑7‑199.8. In our view, it was highly unjust on the part of the petitioners to approbate and reprobate.
After anxious consideration, we are of the view that there was force in the arguments of the respondent that while issuing corrigendum converting his removal from service into compulsory retirement, the matter had not been brought into the notice of the competent Authority. The first notification removing the respondent from service was made in compliance of the approval of the competent Authority, i.e., the Prime Minister, but the corrigendum seems to have been issued at a lower level probably by a Deputy Secretary or a Joint Secretary in the Establishment Division without the matter being brought into the notice of the competent Authority. especially when the departmental appeal against the impugned notification dated 15‑7‑1998 removing the respondent from service had already been preferred by way of Appeal No.913‑R of 1998, which was pending adjudication when this corrigendum was issued. We are in agreement with the Tribunal that after the issuance of the notification dated 15‑7‑1998 removing the respondent from service, the Establishment Division had become functus officio. Strangely enough the petitioners tried to explain that it was a typographical mistake, which had crept into the notification data) 15‑7‑1998 and due to inadvertence in the notification, the removal from service was incorporated and the same could be rectified at any time by the officials of the Establishment Division. The Tribunal repelled this contention and rightly so because it perused the record and the note on the file. The note is reproduced as under:‑‑
"61. The competent Authority has approved imposition of major penalty of compulsorily retirement from service upon Mr. Saleemullah Khan, PSP (BS‑20) (page 33/N). The officer belongs to APUG (PSP). Notification of his compulsorily retirement is required to be issued by E.Wing. A draft U.O. from Joint Secretary (D/L) to J.S.(E) is plated below for approval. , (Sd.) (SIKANDAR HAYAT MAKEN), D.S.(D‑11) 15‑7‑1998.
J.S.(D/L) 62. Pl, put up draft notification on the approved pattern.
(Sd.) J.S. 15‑7‑1998
DS(D‑II)
(Sd.) DS (D‑I1)
15‑7‑1998
JS(D)
(Sd.) JS
15‑7‑1998
Addl. Secy.
(Sd.) Addl. Secy.
15‑7‑1998
Secretary.
(Sd.)
Secretary.
15‑7‑1998."
The explanation can hardly be believed. Assuming otherwise, it was a blunder and if at all it had been noticed by the officers in the Establishment Division that a mistake had been committed, then it was their bounden duty to place the matter before the competent Authority for clarification and for obtaining necessary orders. In our view, the explanation rendered by the petitioners for the issuance e of the corrigendum is an afterthought. The order could have only been reviewed or revised by the President of Pakistan. It was not a clerical or typographical mistake, rather it was alteration in the major penalty. The respondent, in our view. seems to have been victimised for the reason best known to the Establishment Division.
It is, thus, manifest that the notification dated 15‑7‑1998 was not in accordance with the directions of the competent Authority as it runs contrary to the noting reproduced above. The competent Authority directed that the respondent was to be compulsorily retired, but he was removed from service, therefore, the notification being violative of the direction of the competent Authority would be deemed to be null and void. Similar is the position of the corrigendum. As already stated above, the same was issued not at the instance of the competent Authority or the revising Authority, but by some officials in the Establishment Division. No explanation was offered before us for the issuance of the corrigendum.
Adverting to the nature of charges, a reference to them would also he necessary. The first charge against the respondent was that he had collected donations from Jail Superintendents, but according to the report of the Inquiry Officer. one Haji Habib Gul, the Office Superintendent had been dealing with the disbursement of the said amount and the respondent was not found to have misappropriated a single penny. Scrutiny of the findings also leads to the irresistible conclusion that the respondent was not at all involved even in collection of such donations. The respondent had produced documentary evidence in the form of certificates issued by the Jail Superintendents of Kohat, Haripur. Mardan and many others to prove that no efforts were made by them for the collection of such funds nor had they remitted any amount to him in his capacity as I.‑G. Prisons, N.‑W.F.P. Strangely enough, Qayyum Nawaz, Superintendent Jail, Haripur and Abdul ,Latif Arshad, Superintendent Jail, Mardan appeared as witnesses against the respondent and deposed that they had paid Rs.5,000 to Haji Habib Gul to meet the expenses of conference held for the welfare of the prisoners and for no other purpose. Their statements run contrary to the certificates already issued in which they stated that they did not remit any amount. In our view as well, such evidence could not have been relied upon to prove the charge. The Inquiry Officer also came to the conclusion that the entire expenditure for such conference was borne by Gandhara Lions Club whereas Haji Habib Gul stated that he had paid Rs.86,000 through his three jail officers against the bills submitted by them. It is obvious that contradictory stand was taken. The expenses had been borne by Gandhara Lions Club and Printographic Printers and this expenditure was for a conference held to consider the various proposals for the welfare of the prisoners. We fail to understand as to how this could be considered as misconduct. No iota of evidence was produced to show that the respondent was in any manner involved in collection of funds. Even according to the Inquiry Officer the respondent had not at all misappropriated any amount. The Tribunal rightly took judicial notice of the fact that numerous philanthropic societies/organizations collect funds for donating the same for the welfare of the prisoners to provide them fans, medicines., clothes and cash is also collected to meet other expenditure. In any event, without further probe charge No. l could not be proved. As regards charge No.2, the imposition of fee of Rs.2 for holding a meeting with the prisoners was within the knowledge of the Home Department, but no action was taken to forbid the raising of fund by this device. The Tribunal came to the conclusion that in fact the Minister of Jails, who held a meeting, initiated this proposal and the collection of funds was meant to meet the expenditure towards the welfare of the prisoners because it is wellknown that Government is short of funds. The Tribunal had also seen the minutes of the meeting in which at the instance of the Jail Minister this proposal was accepted and the practice remained in vogue only for about two months and thereafter, it was the respondent who in his capacity as I.‑G. Prisons, suo motu ordered to discontinue collection of such fee. The Inquiry Officer also came to the conclusion that no misappropriation of money had taken place, hence this charge also could not be proved against the respondent. As far as charge No.3 is concerned, the same also could not be proved. The respondent had not at all suppressed medical bills of the subordinate officials with a view to receiving his own bill. The warning allegedly issued by the Home Department was set aside by the Chief Secretary to the Government of N.‑W.F.P., therefore, this was a frivolous charge. Similar is the fate of charges 4, 5, 6 and 7. In fact, charges 7 and 8 related to private and personal matters of the respondent and he could not have been proceeded against on the basis thereof.
as far as final show‑cause notice dated 15‑9‑1997 is concerned, it transpires that the Authorized Officer concurred with the findings arrived at by the Inquiry Officer for imposing major penalty of removal from service, besides holding the respondent guilty on three more charges while the competent Authority held the respondent guilty on charges 1 to. 3 and strangely enough no reason was advanced to differ with the findings of the Inquiry Officer. The competent Authority also did not notice nor gave any reasons to differ with the findings of the Inquiry Officer.
From the perusal of all these facts and nature of the charges referred to above, and discussed at length by the Tribunal, it is obvious that these charges could not have been made basis for proceeding against the respondent under the Efficiency and Discipline Rules and the proceedings taken against the respondent thus were totally illegal and contrary to rules.
For the foregoing reasons, we do not find any merit in these petitions. The same are hereby dismissed and leave to appeal is refused. The criminal original petitions are also dismissed.
M.B.A./F‑64/S Petitions dismissed.
P L D 2000 Supreme Court 111
Present: Saiduzzarnan Siddiqui, C.J., Irshad Hasan Khan, Raja Afrasiab Khan, Muhammad Bashir Jehangiri and
Nasir Aslam Zahid, JJ'
Constitutional Petition No.22 of 1999
JAMAT‑I‑ISLAMI PAKISTAN through Syed Munawar Hassan, Secretary‑General‑‑‑Petitioner
versus
FEDERATION OF PAKISTAN through Secretary, Law, Justice and Parliamentary Affairs‑‑‑Respondent
Constitutional Petition No.25 of 1999
MUTTAHIDA QAUMI MOVEMENT (MQM)
through Deputy Convener, Senator? .
Aftab Ahmed Sheikh‑‑‑Petitioner
versus
FEDERATION OF PAKISTAN
through Secretary, Ministry of Interior, Islamabad‑‑‑Respondent
Constitutional Petitions Nos.22 and 25 of 1999, decided on 13th December, 1999.
(Petition under Article 184(3) of the Constitution of the Islamic Republic of Pakistan, 1973).
Per Irshad Hassan Khan, J.‑‑
(a) Anti‑Terrorism Act (XXVII of 1997)‑‑‑
‑‑‑‑Preamble‑‑‑Anti‑Terrorism (Second Amendment) Ordinance (XIII of 1999), Preamble‑‑‑Anti‑Terrorism (Amendment) Ordinance (IV of 1999), Preamble‑‑‑Comparative analysis of the three enactments and situations pre and post‑Mehram Ali's case PLD 1998 SC 1445.
Mehram Ali v. Federation of Pakistan PLD 1998 SC 1445 ref.
(b) Anti‑Terrorism Act (XXVII of 1997)‑‑‑
‑‑‑‑S. 5(2)(i) Jas introduced by Anti‑Terrorism (Second Amendment) Ordinance (XIII of 1999)1‑‑‑Constitution of Pakistan (1973), Art.9‑‑?Security of persons‑‑‑Provision of S.5(2)(i), Anti‑Terrorism Act, 1997 being violative of Art.9 of the Constitution as well as the guidelines provided in the case of Mehram Ali PLD 1998 SC 1445, was invalid to the extent same authorised the Officer of Police, Armed Forces and Civil Armed Forces charged with the duty of preventing terrorism, to open fire or order for opening of tire against person who in his opinion in all probability was likely to commit a terrorist act or any scheduled offence without being tired upon‑‑?Supreme Court, however, observed that judgment rendered in the present petition shall not affect the trials already concluded and convictions recorded under the Act as amended through Ordinances (IV) and (X111) of 1999 and pending trial may continue subject to the view expressed in the present case.
The provisions of section 5(2)(i) of the Anti‑Terrorism Act, 1997 were not suitably amended as expressly mandated by Supreme Court. if the provisions of section 5 of the Act in their present form are given effect to, it will create horrible and far‑reaching consequences, inasmuch as, the law enforcing agencies cannot be given a licence to kill indiscriminately any persons who are allegedly involved in committing terrorist acts as defined under the Act or any of the scheduled offences. Clearly, such a right is to be exercised as a preventive measure and not made basis for launching an attack for retaliation, lest it would tantamount to legalising alleged police encounters/extra‑judicial killings in the garb of exercise of power by a Police Officer vesting in him under section 5(2)(i) of the Act.
Such a course can never be countenanced in a civilised society, particularly, in Pakistan, where Islam is the State religion. It would also militate against the Objectives Resolution forming substantive part of the Constitution under Article 2A thereof, wherein it is, inter alia, provided that the Muslims shall be enabled to order their lives in the individual and collective spheres in accordance with the teachings and requirements of Islam as set out in the Holy Qur'an and Sunnah.
Furthermore, all the offences mentioned in the Act are not punishable with death, but are also punishable with imprisonment for life, or with rigorous imprisonment for various terms.
It is incumbent upon the police force to act so as to enforce Article 9 of the Constitution, given in Chapter 1 thereof, which provides that no person shall be deprived of life or liberty save in accordance with law rather than to violate the same and expose himself to criminal prosecution. In this regard the principles enshrined in sections 99 to 106 of the Pakistan Penal Code are also instructive, which contemplate that police personnel cannot exercise the right of private self‑defence more than what has been directed in the above sections.
The Government should have kept in view the law declared by this Court in the case of Ch. Yaqoob (1992 SCMR 1983) and Mehram Ali (PLD 1998 SC 1445), therefore, section 5(2)(i) of Anti‑Terrorism Act, 1997 as introduced by Ordinance XIII of 1999 to the extent, the same authorised the officer of Police, Armed Forces and Civil Armed Forces charged with the duty of preventing terrorism, to open fire or order for opening of fire against person who in his opinion in all probability was likely to commit a terrorist act or any scheduled offence without being fired upon, was violative of Article 9 of the Constitution as well as the guidelines provided in the case of Mehram Ali and the same is held to be invalid to the above extent and required to be suitably amended.
Section 5(2)(i) of the Act as introduced by Ordinance (XIII of 1999) to the extent indicated above is violative of Article 9 of the Constitution as well as the guidelines provided in the case of Mehram Ali PLD 1998 SC 1445 and the same was held to be invalid to the above extent and required to be suitably amended.
Supreme Court observed that the judgment rendered in present petition shall not affect the trials already concluded and convictions recorded in the Act as amended through Ordinances IV and XIII of 1999 and pending trial may continue subject to the above.
(c) Words and phrases?
---Internal ?disturbance" ‑‑‑Connotation.
(d) Constitution of Pakistan (1973)‑‑‑
‑‑‑‑Art. 232‑‑‑"Internal disturbance" ‑‑‑While construing the term "internal disturbance" the same is to be understood in terms of general parlance.
While construing the term "internal disturbance" the term is to be understood in terms of general parlance. "Internal disturbance" in the context of civil commotion may include an outbreak of large scale violence due to disturbance in any part of the country.
(e) Words and phrases‑‑‑
‑‑‑‑"Strike"‑‑‑Connotation.
(f) Industrial dispute‑‑‑
‑‑‑‑Strike‑‑‑Concept.
The term "strike" is popularly used in labour laws of the country and is generally understood as a simultaneous cessation of work on the pan of the workmen, and its legality or illegality depends on the means by which it is enforced and upon its object having reference to specific provision in the relevant laws. The "strike" is the combined effort of workmen to obtain higher wages or other concessions and privileges from their employers by stopping work at a pre‑concerted time until their demands are met. The question as to whether a call of strike given by workmen or members of labour union or members of the union of workers/employees is lawful or otherwise depends upon the facts and circumstances of each case having regard to the specific provisions laid down in the relevant statutes and the object sought to be achieved.
(g) Words and phrases‑‑‑
‑‑‑‑"Lock‑out" and "strike" ‑‑‑Distinction.
Words and Phrases, Permanent Edn., Vol. 40, p.471 and City of Wilmington v. General Teamsters Local Union 326 Del., 321 A.2d 123, 126 ref.
(h) Industrial dispute‑‑‑
‑‑‑‑"Lock‑out" and "strike"‑‑‑Distinction.
A 'strike' where men quit because the employer refuses conditions demanded of him, and a 'lock‑out' where employees refuse to return to work unless the employer meets their demands.
In order for there to be a 'strike', there must be some concerted action or combined effort by group which is designed to exert pressure on an individual or entity to accede to certain demands.
"Work stoppage" is a lock‑out and not a strike. However, in certain conditions a "work stoppage" may be synonymous with the word "strike", for instance, where stoppage of work may arise because of strike, but picketing by employees during work stoppage as a result of lock‑out generally does not mean that the employees were on "strike". Strikes and lock‑outs in labour or industrial disputes may be permissible as well as impermissible, legal as well as illegal, depending upon the facts of each case with reference to the relevant provisions in the relevant statute. Strike is also understood to mean cessation of economic activity including 'Paiyya Jam' (wheel jam) and closure of shops and establishments at the call of a political party to press for their political demands in furtherance of their manifesto, policies or programmes. Strike may also be in the nature of sympathy strike which is a common manifestation of traditional solidarity with a cause. Sympathy strikes are a common manifestation of national solidarity on any national or international cause in endeavouring to preserve and strengthen a noble cause. Sit down strike is generally observed at the call of a political party by resorting to "Dherna" (sit down).
(i) Words and phrases‑‑‑
‑‑‑‑"Civil commotion"‑‑‑Definition.
A 'civil commotion' is an uprising among a mass of people which occasions a serious and prolonged disturbance and infraction of civil order not attaining the status of war or an armed insurrection, and is a wild irregular action of many persons assembled together.
A 'commotion' is defined to be a tumult and tumult to be a promiscuous commotion of a multitude; an irregular violence, a wild commotion. A 'civil commotion', therefore, requires the wild or irregular action of many persons assembled together.
A 'civil commotion' is an insurrection of the people for general purposes, though it may not amount to a rebellion while there is a usurped power.
Words and Phrases, Vol. 7 ref., (j) Words and phrases‑‑
‑‑‑‑"Disturbance"‑‑‑Meaning.
Any conduct contrary to the usages of a particular sort of meeting and class of persons assembled, and which interferes with its due progress or is annoying to the assembly in whole or in part is a 'disturbance'.
'Disturbance' is defined as any conduct which, being contrary to the usages of the particular sort of meeting and class of persons assembled, interferes with its due progress and services, or is annoying to the congregation in whole or in part, (k) Words and phrases‑‑‑
-----? Vague?----Meaning.
Legal Theasurus, Regular Edn. by William C. Burton and Black's Law Dictionary, 6th Edn. by Henry Campbell Black ref.
(l) Interpretation of statutes‑‑‑
‑‑‑‑ Statute must be intelligibly expressed and reasonably definite and certain‑‑‑Principles.
Statutes must be intelligibly expressed and reasonably definite and certain. An act of the Legislature to have the force and effect of law must be intelligibly express and statutes which are too vague.. to be intelligible are a nullity. Certainty being one of the prime requirements of a statute, a statute in order to be valid must be definite and certain. Anticipated difficulty in application .of its provisions affords no reason for declaring a statute invalid where it is not uncertain. Reasonable definiteness and certainty is required in statutes and reasonable certainty is sufficient. Reasonable precision, and not absolute precision or meticulous or mathematical exactitude, is required in the drafting of statutes, particularly as regards those dealing with social and economic problems.
(m) Interpretation of, statutes‑‑‑
‑‑‑ ‑Penal statute‑‑‑Statute creating an offence must be precise, definite and sufficiently objective so as to guard against an arbitrary and capricious action on the part of the State functionaries who are called upon to enforce the statute‑‑‑Penal statutes contemplate notice to ordinary person of what is prohibited and what is not.
(n) Anti‑Terrorism Act (XXVII of 1997)‑‑‑
‑‑‑‑S. 7‑A [as amended by Anti‑Terrorism (Second Amendment) Ordinance (XIII of 1999)]‑‑‑Constitution of Pakistan (1973), Art. 4‑‑‑Creation of civil commotion‑‑‑Rights of individual to be dealt with in accordance with law‑‑‑Principles‑‑‑Incumbent upon the State to express in clear terms susceptible of being understood by an ordinary citizen of what was prohibited and to provide definite standards to guide discretionary action of police officers so as to prevent arbitrary and discriminatory operation of S.7‑A, Anti Terrorism Act, 1997‑‑‑Provision of S.7‑A, Anti‑Terrorism Act, 1997, therefore, has to spell out from a bare reading as to what constitutes "internal disturbance", "illegal strike", "go slow" and "lock‑out" in terms of said S.7-A.
Article 4 of the Constitution relating to the rights of individual to be dealt with in accordance with law, is in the nature of "due process" clause. To enjoy protection of law and to be treated in accordance with law is the inalienable right of every citizen and no action detrimental to the life, liberty, body, reputation or property of any person shall be taken except in accordance with law. No person shall be prevented from or be hindered in doing that which is not prohibited by law and no person shall be compelled to do that which the law does not require him to do. Every citizen has the inalienable right under the Constitution to know what is prohibited by law and what the law does not require him to do. It is, therefore, incumbent upon the State to express in clear terms susceptible of being understood by an ordinary citizen of what is prohibited and. to provide definite standards to guide discretionary actions of police officers so as to prevent arbitrary and discriminatory operation of section 7‑A of the Anti‑Terrorism Act, 1997. In other words, it must be spelt out from a bare reading of section 7‑A as to what constitutes "internal disturbances", "illegal strikes", "go‑slows" and "lock‑outs" in terms of section 7‑A of the said Act.
(o) Interpretation of statutes‑‑‑
‑‑‑‑ True meaning of statute‑‑‑Duty of Court‑‑‑Principles.
It is the duty of the Court to find out the true meaning of a statute while interpreting the same. The general rule is that the Courts adopt as uniform an approach as possible to the reading of ambiguous Acts of Parliament which are some times imperfect, obscure and vague. The primary rule of interpretation of statutes is that the meaning of the Legislature is to be sought in the actual words used by him which are to be interpreted in their ordinary and natural meanings. The cardinal rule for the construction of Acts of Parliament is that they should be construed according to the intention expressed in the Acts themselves. Where the language of the statute is plain and unambiguous, and conveys a clear and definite meaning, there is no occasion for resorting to the rules of statutory interpretation, and the Court has no right to impose another meaning or to read into its limitations which are not there, based on a prior reasoning as to the probable intention of the Legislature. Court can resort to the proceedings of the Legislature when the language employed is ambiguous.
Nairn v. University of St. Andrews (1909) AC 147, Interpretation of Statutes by Bhawani Lal, p.2; Statute Law by Craies, 7th Edn., pp.64‑65; Interpretation of Statutes by Bindra, 7th Edn., p.478; Ms. Benazir Bhutto v. Federation of Pakistan PLD 1988 SC 416; Al‑Jehad Trust v. Federation of Pakistan PLD 1996 SC 324 and Fisher v. Bell (1961) 1 QB 394 ref.
(p) Anti‑Terrorism Act (XXVII of 1997)‑‑‑
‑‑‑‑S. 7‑A Jas amended by Anti‑Terrorism (Second Amendment) Ordinance (XIII of 1999)]‑‑‑Constitution of Pakistan (1973), Arts. 4, 9, 14, 16, 19, 27 & 184(3)‑‑‑Creation of civil commotion‑‑‑'Internal disturbance', 'illegal strike', 'lock‑out' and 'go‑slow' having not been expressed in definite terms for the purposes of S.7‑A, Anti‑Terrorism Act, 1997, in that, it would be in the interest of parties to leave it to a police office` to apply the law which is vague and unintelligible ‑‑‑Ejusdem generis, doctrine of‑‑‑Application‑‑‑Rule of Noscitur a sociis‑‑‑Applicability‑‑‑State is duty bound to disclose in the law as to what constitutes an offence‑‑‑Every citizen has a Constitutional right to lead his life in accordance with law and what is not prohibited by law‑‑‑Vague definition of the words 'internal disturbances', 'illegal strike' 'lock‑out' and 'go slow', if allowed to continue in the Act in the present form, could lead to imbalance in individual and community rights‑‑?Provisions of S.7‑A, Anti‑Terrorism Act, 1997 to such an extent is unconstitutional in that, same infringes the presumption of innocence and does not meet the condition to reasonableness due to vagueness‑‑? Principles‑‑‑Provision of S.7‑A, Anti‑Terrorism Act to the extent described is, therefore, invalid being repugnant to the Constitution and requires to be suitably amended‑‑‑Supreme Court, however, observed that judgment rendered in the present petition shall not affect the trials already concluded and convictions recorded under the Act as amended through Ordinances (IV) and (XIII) of 1999 and pending trials may continue subject to the view expressed in the present case.
In the present case the offences of "illegal strike", "lock‑out" and ?go‑slow" have not been used with reference to dispute between workmen and employers, but were intended to provide for the prevention of terrorism, sectarian violence and for speedy trial of heinous offences and for matters connected with them and incidental thereto, as is apparent from a bare reading of the Preamble to the Anti‑Terrorism Act, 1997. It is, therefore, difficult to hold that the words "illegal strike", "lock‑out" and "go‑slow" have been used in the sense as defined in the Industrial Relations Ordinance 1969. or in other labour or industrial laws. The words "illegal strike", "lock? out" and "go‑slow" are wide open terms which include, apart from employer and employees engaged in commerce, trade and industry, other person irrespective of their trade and calling. . These terms, therefore, cannot be restricted merely to Labour Laws. Clearly`, it would not be a fair or desirable interpretation to restrict the meaning of the above terms in the context of Labour Laws alone.
The meaning of "illegal strikes" are since doubtful the same may be ascertained by a reference to the words associated with it by applying the rule of Noscitur a. sociis. The rule that a word is known by the company it keeps. is not an ineluctable rule. It is applied wisely only where a word is capable of many meanings so that giving an unintended breadth to a statute may be avoided.
It is a well‑settled rule of construction of statutes that if the words used are ambiguous and. admit of two constructions and one of them leads to a manifest absurdity or to a clear risk of injustice arid the other leads to no such consequence, the second interpretation must be adopted. Thus, for the smooth operation of the law and the purposes for which it has been. enacted i.e. to provide for the prevention of terrorism, sectarian violence and for speedy trial of heinous offences, the above terms have not been used in the restrictive sense but in a broader sense.
It was contended that the terms "illegal strike", "go‑slows" and "lock‑outs" are to be read was ejusdem generis with the term "internal disturbances" in the context of "civil commotion" as envisaged by section 7‑A of the Act.
The doctrine of ejusdem generis is well‑settled. It means that where general words follow an enumeration of persons or things, by words of a particular and specific meaning such general words are not to he construed in their widest extent, but are to be held as applying only to persons or things of' the same general kind or class as those specifically mentioned.
However, the doctrine will apply when there is nothing in the provision or Act to show a wider sense was not intended or the intention to give to the general term a broader meaning than the doctrine requires was not manifested.
General terms following particular ones apply only to such persons or things as are ejusdem generis with those comprehended in the language of the Legislature. In other words, the general expression is to be read as comprehending only things of the same kind as that designated by the preceding particular expressions, unless there is something to show that a wider sense was intended
?The rule of doctrine of 'ejusdem generis' will apply unless intention to the contrary is clearly shown.
Where general words follow the enumeration of particular classes of persons or things, the general words, under the rule or maxim of construction known as 'ejusdem generis', will be construed as applicable only to persons or things of the same general nature or class as those enumerated unless an intention to the contrary is clearly shown.
The doctrine applies when the following five conditions exist:
(1) The statute contains an enumeration by specific words;
(2) the members of the enumeration constitute a class;
(3) the class is not exhausted by the enumeration; , (4) a general term follows the enumeration; and
(5) there is not clearly manifested an intent that the general term be given a broader meaning than the doctrine requires.
The question still remains to be solved that in the absence of clear, certain and definite expression, of the phrase "internal disturbances" not susceptible of being understood in terms of the language employed therein, an ordinary citizen will have no notice of what disturbances. are prohibited which tantamounted to "internal disturbances" in the context of "civil commotion" as defined in section 7‑A of the Act. It is difficult to give an exhaustive definition of the term "internal disturbances". It may be understood in the context of run down of the law and order situation in the country. Disturbances resulting in loss of life and property, disturbances resulting from large scale clashes between various factions of the people, or where a Government finds it difficult to maintain law and order, to run the ordinary, administration of the country, to keep open educational institutions and to ensure normal economic activity and functioning of the various State institutions could be termed as internal disturbance, depending upon the language in a statute. It is essential to define in clear and definite terms as to what constitutes an act of civil commotion in unambiguous words without derogation to the rights of the citizens to the enjoyment of rights guaranteed under Article 4 (rights of individuals to be dealt with in accordance with law). Article 9 (security of person), Article 14 (inviolability of dignity of man), Article 16 (freedom of' assembly) and Article 27 (equality of citizens) and Article 19 (freedom of speech and expression) and there shall be freedom of the press, subject to any reasonable restrictions imposed by law in the interest of the glory of Islam or the integrity. security or defence of Pakistan or any part thereof, friendly relations with foreign States, public order, decency or morality, or in relation to contempt of Court, commission of or incitement to an offence.
The terms "illegal strike", "lock‑out" and "go‑slow" are not to be read in the context of Labour Laws, the above words are to be read ejusdem generis with the word "internal disturbances". However, the difficulty is that the words "internal disturbances" used in section 7‑A are vague. The term "internal disturbance" may have various meaning depending upon the context in which it is used. The words "internal disturbance" and "civil commotion" connote temporary outbreak of unlawful violence, whereby the ordinary business of the community is, more or less, interrupted and it has the effect of uprising among the masses which occasions serious and prolonged disturbances and insurrection. Civil disorder not attaining the situation of war or an 'armed insurrection, is ‑ a wild and irregular .action with many persons assembled together. "'Internal disturbance" is a disturbance occurring in arty part of the country which wrongfully interferes with the general tranquillity in social and ordinary life of the people tinder the Constitution and the law. The meaning of the term "internal disturbances", "illegal strike", lock‑out" and "go‑slow" must be expressed in definite terries for the purposes of section 7-A of the Act, in that, it would not be in. the interest of justice to leave it to a police officer to apply the law which is vague and unintelligible. Constitutional guarantee of the Fundamental Right to have a fair trial is spelt out from Article 9 of the Constitution. An accused is not only entitled to pre‑trial disclosure by the prosecution to the defence of relevant material specially the statements of witnesses under section 161, Gr.P.C. but also pre‑commission disclosure of the offence before being tried. It is the duty of the State to disclose in the law as to what constitutes an offence. Viewed from that angle section 7‑A of the impugned Act to the extent indicated above is unconstitutional, in that, it infringes the presumption of innocence and does not meet the condition of reasonableness due to vagueness. Every citizen has a Constitutional right to lead his life in accordance with law and what is not prohibited by law. The vague definition of the words "internal disturbances", "illegal strike", "lock‑out" and "go?-slow", if allowed to continue in the statute in their present form, could lead to imbalance in individual and community rights.
Therefore, section 7‑A of the Anti‑Terrorism Act, 1997 to the extent indicated above is invalid being repugnant to the Constitution and requires to be suitably amended.
Section 7‑A of the Anti‑Terrorism Act, 1997 to the extent indicated above is invalid being repugnant to the Constitution and requires to be suitably amended. Commencement or continuation of illegal strikes; go? slows and lock‑outs mentioned in section 7‑A should have nexus with the objects mentioned in sections 6, 7 and 8 of the Act.
Supreme Court observed that the judgment rendered in the present petitions shall not ‑ affect the trials already concluded and convictions recorded in the Anti‑Terrorism Act, 1997 as amended through. Ordinances IV and XIII of 1999 and pending trials may continue subject to the above.
Don Basco High School v. Assistant Director, E.O.B.I. and others PLD 1989 SC 128 ref.
(q) Anti‑Terrorism Act (XXVIII of 1997)‑‑‑
‑‑‑‑S. 7‑A [as amended by Anti‑Terrorism (Second Amendment) Ordinance (XIII of 1999)]‑‑‑Industrial Relations Ordinance (XXIII of 1969), S.2(xxv)‑‑?Creation of civil commotion‑‑‑Interpretation of 'illegal strike', 'lock‑out' and 'go‑slow' as used in S.7‑A, Anti‑Terrorism Act, 1997 could not be restricted to the meaning in the context of labour laws alone.
(r) Noscitur a sociis, rule of‑‑‑
‑‑‑‑Applicability.
(s) Interpretation of statutes‑‑
‑‑‑‑ Words used in the statute being ambiguous and admitting two constructions, one of them leading to manifest absurdity or to a clear risk of injustice and other leading to no such consequence, the second interpretation was to be adopted.
(t) Ejusdem generis, doctrine of‑‑‑
‑‑‑‑Application‑‑‑Principles.
The doctrine of ejusdem generis is well‑settled. It means that where general words follow an enumeration of persons or things, by words of a particular and specific meaning such general words are tot to be construed in their widest extent, but are to be held as applying only to persons or things of the same general kind or class as those specifically mentioned.
However, the doctrine will apply when there is nothing in the provision or Act to show a wider sense was not intended or the intention to give to the general term a broader meaning than the doctrine requires was not manifested.
General terms following particular ones apply only to such persons or things as are ejusdem generis with those comprehended in the language of .the Legislature. In other words, the general expression is to be read as comprehending only things of the same kind as that designated by the preceding particular expressions, unless there is something to show that a wider sense was intended.
The rule or doctrine of 'ejusdem generis' will apply unless intention to the contrary is clearly shown.
Where general words follow the enumeration of particular classes of persons or things, the general words, under the rule or maxim of construction known as 'ejusdem generis', will be construed as applicable only to persons or things of the same general nature or class as those enumerated unless an intention to the contrary is. clearly shown.
The doctrine applies when the following five conditions exist:
(1) The statute contains an enumeration by specific words;
(2) the members of the enumeration constitute a class;
(3) the class is not exhausted by the enumeration
(4) a general term follows the enumeration; and
(5} there is not clearly manifested an intent that the general term be given a broader meaning than the doctrine requires.
Don Basco High School v. Assistant Director, E.O.B.I. and others PLD,1989 SC 128 ref.
(u) Anti‑Terrorism Act (XXVII of 1997)‑‑‑
‑‑‑‑S. 14‑‑‑Composition and appointment of Presiding Officers of Special Courts‑‑‑Guidelines for procedure.
Supreme Court, however, observed that judgment rendered in the present petition shall not affect the trial already concluded and convictions recorded under the Act as amended through Ordinance (IV) and (XIII) of 1999 and pending trials may continue subject to the view expressed in the present case.
Provision of section 14, Anti‑Terrorism Act, 1997 has suitably been amended in consonance with Supreme Court ,judgments in Mehram Ali v. Federation of Pakistan PLD 1998 SC 1445 and Sh. Liaquat Hussain v. Federation of Pakistan PLD 1999 SC 504. The appointment of the Judges of the Anti‑Terrorism. Courts have to be made by the Federal Government or the Provincial Government, as the case may be, in consultation with the Chief Justice of the High Court concerned. Statutory tenure of 2‑1/2 years has also been guaranteed and 'a Judge once appointed cannot be removed prior to the completion of the period for which he has been appointed, except./after consultation with the Chief Justice of the High Court concerned. It is inconceivable that. the Chief Justice of a High Court would recommend arbitrary removal of any Judge of the Anti‑Terrorism Court ‑in contravention of his statutory tenure except on ground of misconduct.
Section 14 has been suitably amended in consonance with the principles laid down in Mehram Ali v. Federation of Pakistan PLD 1998 SC 1445 and Al‑Jehad Trust v. Federation of Pakistan PLD 1996 SC 324 cases.
Supreme Court observed that the judgment rendered in the present petitions shall not affect the trials already concluded and convictions recorded in the Act as amended through Ordinances IV and XIII of 1999 and pending trials may continue subject to the above.
Mehram Ali v. Federation of Pakistan PLD 1998 SC 1445 and Sh, Liaquat Hussain v. Federation of Pakistan PLD 1999 SC 504 ref.
(v) Anti‑Terrorism Act (XXVII of 1997)‑‑‑
‑‑‑‑S. 35‑‑‑Provision of S.35, Anti‑Terrorism Act, 1997 in its present form is not valid as the same militates against the concept of the independence of judiciary and is also violative of Arts. 175 & 203 of the Constitution, and therefore, S.35 needs to be suitably amended inasmuch as the power to frame rules is to be vested in the High Court to be notified by the Government‑‑?Supreme Court, however, observed that judgment rendered in the present petition shall not affect the trials already concluded and convictions recorded under the Act as amended through Ordinances (IV) and (XIII) of 1999, and pending trials may continue subject to the view expressed in the present case.
(w) Anti‑Terrorism (Second Amendment) Ordinance (XIII of 1999)‑‑‑
‑‑‑‑Preamble‑‑‑Except for provision of Ss. 4 & 7 of Anti‑Terrorism Ordinance (Second Amendment) Ordinance, 1999 rest of the provisions of the Ordinance were intra vires and not in conflict either with the provisions of the Constitution or the guidelines provided in the case of Mehram Ali v. Federation of Pakistan PLD 1998 SC 1445.
Per Saiduzzaman Siddiqui, C.J.‑‑
(x) Anti‑Terrorism Act (XXVII of 1997)‑‑‑
-------Preamble‑‑‑Legislative history of Anti‑Terrorism Act, 1997 summarised.
(y) Anti‑Terrorism Act (XXVII of 1997)‑‑‑
‑‑‑‑S. 5(2)(i) [as amended by Anti‑Terrorism (Second Amendment) Ordinance (XIII of 1999)]‑‑‑Constitution of Pakistan (1973), Art.9‑ Provision of S.5(2)(i), Anti‑Terrorism Act, 1997 [as amended] being clearly violative of the term of Art.9 of the Constitution and not amended in accordance with the direction of Supreme Court in Mehram Ali v. Federation of Pakistan PLD 1998 SC 1445 required to be suitably amended‑‑‑Principles.
Section 5 (2)(i) as amended authorises the police officer or the member of the armed forces or the civil armed forces, deployed in connection with the prevention of terrorism to fire or order firing upon any person who is committing a terrorist act or a scheduled offence. The list of offences triable under the Act is 'given in the Schedule to the Act. There are many offences listed in the Schedule for which punishment prescribed under the relevant law is ten years or less. Therefore, if a person is tried for such scheduled offences before an A.T.A. Court and convicted, he would be liable to punishment which may extend to ten years or less. However, under section 5(2)(i), the police officer or the armed forces or civil armed forces may open fire on such offender, without being fired upon, if he is found committing the offence, thus, causing his death. Such a provision is clearly violative of the terms of Article 9 of the Constitution. Amendment made in section 5(2)(i) being not in accordance with the direction of Supreme Court in Mehram Ali's case (PLD 1998 SC 1445) required to be suitably amended in the light of the above observations.
(z) Anti‑Terrorism Act (XXVII of 1997)‑‑‑
‑‑‑‑S. 35 [as amended by Anti‑Terrorism (Second Amendment) Ordinance (XIII of 1999)]‑‑‑Amendment of S.35, Anti‑Terrorism Act, 1997 being not in accordance with guidelines provided by Supreme Court in Mehram Ali's case (PLD 1998 SC 1445) S. 35 was directed to be amended suitably in line with the observation of Supreme Court.
(aa) Anti‑Terrorism Act (XXVII of 1997)‑‑‑
‑‑‑‑S. 7‑A [as amended by Anti‑Terrorism (Second Amendment) Ordinance (XIII of 1999)]‑‑‑Constitution of Pakistan (1973), Arts. 2A, 4, 9, 16, 17, 19 & 25‑‑‑Provision of S.7‑A, Anti‑Terrorism Act, 1997 to the extent the section makes "internal disturbances", "illegal strikes", "go‑slows" and "lock‑outs" punishable as an act of terrorism, the same cannot be upheld.
(bb) Anti‑Terrorism Act (XXVII of 1997)‑‑‑
‑‑‑‑S. 7‑A‑‑‑Terrorism act‑‑‑"Internal disturbance in violation of law"‑‑‑To make an act punishable under the Anti‑Terrorism Act, 1997, it must be shown that the act bears nexus with Ss. 6, 7 & 8 of the Anti‑Terrorism Act, 1997‑‑‑Magnitude of "internal disturbance" being a determining factor for the proposed action, internal disturbance in violation of law simpliciter would not bear nexus to the object of the Anti‑Terrorism Act, 1997 and as, such its punishment in present form under the Act was not sustainable under the Act‑‑‑Principles.
To make an act punishable under the Anti‑Terrorism Act, 1997 it must be shown that the act bears nexus to sections 6, 7 and 8 of the said Act.
A careful reading of the definition of "creation of civil commotion" in section 7‑A, Anti‑Terrorism Act, 1997 would show that besides making 'creation of internal disturbance .in violation of law, commencement or continuation of illegal strikes, go‑slows and lock‑outs, vehicle snatching or lifting, damage to or destruction of State or private property, random firing to create panic, charging Bhatha, and acts of criminal trespass (illegal Qabza) have also been made punishable under section 7‑B of the Act as terrorist acts.
The expression 'internal disturbance' used in section 7‑A, Anti? Terrorism Act, 1997, has not been defined. It is not known what acts would fall within the meaning of internal disturbance to make it punishable under the Act. The expression 'internal disturbance' simpliciter is vague and bears no nexus to the terrorist act unless it is elucidated further. The 'internal disturbance' may produce variety of consequences. Article ‑ 232(1) of the Constitution is referred which authorises the President to proclaim emergency if he is satisfied amongst others that the security of Pakistan or any part thereof is threatened by internal disturbance beyond the power of a Provincial Government to control it. Therefore, the magnitude of the internal disturbance would be a determining factor for the proposed action. Internal disturbance in violation of law simpliciter does not bear nexus to the object of the Act and as such its punishment in its present form under the Act, is not sustainable under the Act.
(cc) Anti‑Terrorism Act (XXVII of 1997)‑‑‑
‑‑‑‑S. 7‑A‑‑‑"Illegal strikes", "go‑slows", "lock‑outs" having not been defined in Anti‑Terrorism Act. 1997‑‑‑Constinuation of illegal strikes, lock?outs and go‑slows as defined under Industrial Relations Ordinance, 1969, bear no nexus with terrorism or terrorist act as defined in the Anti‑Terrorism Act, 1997 as such the same could not be made punishable tinder Anti ?Terrorism Act, 1997‑‑‑Principles.
The meaning of the words 'strike'. 'illegal strike', 'lock‑outs', 'illegal lock‑outs' and 'illegal go‑slows' were already known to the Legislature when it‑enacted the Act as these expressions were in connection with labour laws.
Strike, lock‑out, illegal strike and illegal lock‑out, are defined respectively in clauses (xxv), (xvi), (xii), and (xi) of section 2 of the Industrial Relations Ordinance, 1969.
Right to serve notice of strike by workers sand lock‑out by the employer is given in section 26 of the said Ordinance.
The period of notice of strike or lock‑out is prescribed as fourteen days in section 28 of Industrial Relations Ordinance, 1969.
Section 32 of the said Ordinance deals with the right of workers to go on strike and that of employer to declare lock‑out.
Section 46 of the Ordinance sets out the circumstances which would render a strike or a lock‑out illegal.
Section 46‑A of the Ordinance described the procedure for dealing with illegal strikes or lock‑outs.
Section 59 of the Industrial Relations Ordinance, 1969 which provides for punishing for taking part in or instigating go‑slow, was omitted by Act No.XVI of 1975 dated 10‑12‑1995.
From the above‑referred provisions of Industrial Relations Ordinance, 1969, it is quite clear that right to go on strikes or to declare lock‑outs are the normal rights of the workers and employers respectively which are regulated under the said Ordinance. Similarly, the procedure to deal. with illegal strikes by workers and declaration of illegal lock‑outs by employers are dealt with under section 46‑A of the Ordinance and disobedience of the order passed under section 46‑A are made punishable under section 56 of the same Ordinance. In the same manner, go‑slow which was punishable under section 59 of the Ordinance is no more an offence after omission of section 59. In these circumstances, it is difficult to agree with the contention that continuation of illegal strikes, lock‑outs and go‑slows amounts to terrorism or a terrorist act, which could be punished under the Act. Illegal strikes, lock‑outs and go‑slows as defined under Industrial Relation Ordinance, 1969, bear no nexus with terrorism or terrorist act and as such, the same could not be made punishable under the Anti‑Terrorism Act. In the absence of the definition of illegal strike, illegal lock‑outs, or illegal go‑slows which establish nexus of these acts with terrorism or a terrorist act, as defined in the Anti‑Terrorism Act, the same could not be made punishable under the Act.
M. Akram Sheikh, Senior Advocate Supreme Court and M.A. Zaidi, Advocate‑on‑Record for Petitioner (in both Petitions).
Aziz A. Munshi, Attorney‑General for Pakistan and Tanvir Bashir Ansari, Dy. A.‑G. for Respondents (on Court's Notice).
Dates of hearing: 4th, 15th and 16th November, 1999.
JUDGMENT
IRSHAD HASAN KHAN, J.‑‑‑This judgment shall dispose of Constitutional Petitions No.22 and 25 of 1999, filed by Jamat‑i‑Islami Pakistan and Muttahida Qaumi Movement (MQM), respectively, under Article 184(3) of the Constitution of the Islamic Republic of Pakistan, 1973 (hereinafter referred as the Constitution), challenging the vires of Ordinance (IV of 1999), dated 27‑4‑1999, whereby certain amendments were introduced in Anti‑Terrorism Act, 1997 (XXVII of 1997) on the ground of being repugnant to the Constitution and contrary to the guidelines provided by this Court in the case of Mehram Ali v. Federation of Pakistan (PLD 1998 SC 1445). It may be observed that the above Ordinance stood repealed on the expiration of four months, in terms of Article 89 of the Constitution. However, the Anti‑Terrorism (Second Amendment) Ordinance (Ordinance MIT of 1999), dated 27‑8‑1999, was promulgated by re‑enacting the provisions of Ordinance IV of 1999 with some modifications. In order to avoid multiplicity of proceedings and in the interest of justice, we have allowed the parties to make submissions on the vires of Ordinance XIII of 1999 as well.
(i)???????? Section 5(2)(i) is held to be invalid to the extent it authorises the officer of Police, armed forces and civil armed forces charged with the duty of preventing terrorism, to open fire or order for opening of fire against person who in his opinion in all probability is likely to commit a terrorist act or any scheduled offence, without being fired upon;
(ii)??????? section 10 of the Anti‑Terrorism Act, 1997, hereinafter referred to as the Act, in its present form is not valid; the same requires to be suitably amended as to provide that before entering upon premises which is suspected to have material or a recording in contravention of section 8 of the Act, the concerned officer of Police, armed forces or civil armed forces shall record in writing his reason for such belief and serve on the person or premises concerned a copy of such reasons before conducting such search; '
(iii)?????? section 19(10)(b) of the Act, which provides for trial of an accused in absentia on account of his misbehaviour in the Court, is violative of Article 10 of the Constitution and, therefore, is declared as invalid;
(iv)?????? sections 24, 25, 27, 28, 30 and 37 of the Act are also not valid in their present form as they militate against the concept of independence of judiciary and Articles 175 and 203 of the Constitution. They need to be amended as to vest the appellate power in a High Court instead of Appellate Tribunal and to use the words "High Court" in place of "Appellate Tribunal'", (v)??????? section 26 of the Act is not valid in its present form as it makes admissible the confession recorded by a police officer not below the rank of a Deputy Superintendent of Police as it is violative of Articles 13(b) and 25 of the Constitution and that the same requires to be suitably amended by substituting the words 'by a police officer not below the rank of a Deputy Superintendent of Police' by the words 'Judicial Magistrate'.
(vi)?????? that the offences mentioned in the Schedules should have nexus with the objects mentioned in sections 6, 7 and 8 of the Act;
(vii) section 35 of the Act in its present form is not valid as it militates against the concept of the independence of judiciary and is also violative of Articles 175 and 203 of the Constitution and, therefore, it needs to be suitably amended inasmuch as the power to frame rules is t4 be vested in the High Court to be notified by the Government;
(viii) section 14 of the Act requires to be amended as to provide security of the tenure of the Judges of the Special Courts in consonance with the concept of independence of judiciary.
That the above declaration will not affect the trials already conducted and convictions recorded under the Act and the pending trials may continue subject to as above."
Before dilating upon. the submissions made by Mr. M.. Akram Sheikh, learned Senior Advocate Supreme Court appearing for the petitioners, it would be convenient to refer to the comparative analysis of Anti‑Terrorism Act XXVII of 1997, Ordinance IV of 1999 and Ordinance XIII of 1999 and the situation pre‑and post‑Mehram Ali's case:
COMPARATIVE ANALYSIS OF ANTI‑TERRORISM ACT, XXVII OF 1997 .
SITUATION PRE AND POST MEHRAM ALI?S CASE
| | | | | | | --- | --- | --- | --- | --- | | S:No. 1 | Act XXVII of 1997 2 | Mehram Ali PLD 1998 SC 1445 3 | Ordinance IV of 1999 4 | Ordinance XIII of 1999 5 | | | | | | Section 7-A of? the Ordinance IV? of 1999 has been?? amended and? mainly, its portion related??????????? to handbill, graffiti and wall-chalking been? omitted (the omitted portion is shown below as highlighted) |
7-A. Creation of civil commotion.--"Civil commotion" means creation of internal disturbances in violation of law or intended to violate law, commencement or continuation of illegal strikes, go-slows, lock-outs, vehicles snatching or lifting, damage to or destruction of State or private property, random firing to create panic, charging Bhatta, acts of criminal trespass (illegal Qabza) distributing, publishing or pasting of a handbill or making graffiti or wall-chalking intended to create unrest or fear or create a threat to the security of law and order or to incite the commission of an offence punishable under Chapter VI of the Pakistan Penal Code (Act XLV of 1860).
| | | | | | | --- | --- | --- | --- | --- | | 1 | 5. Use of armed forces and civil armed forces to prevent terrorism.--(1)Any police officer, ?or member of the armed forces, or civil armed forces, who is present or deployed in any ?area may, after giving sufficient warning, use the necessary force to prevent the commission of terrorist acts or scheduled offences, and, in so doing shall, in the case of any officer of the armed forces or civil armed forces, exercise upon; all the powers of a police officer under the Code. (2) In particular and without prejudice to the generality of the provisions of subsection (1). an officer of the police, armed forces and civil armed??????? forces may--(i) after giving prior warning use such force as may be deemed necessary or appropriate, bearing in mind all the facts and circumstances of the situation, against any person who is committing, or in all probability is likely to commit a terrorist act or a scheduled offence, and it ?shall be lawful for any such officer, or any superior officer, to fire, or order the firing upon any person or persons against whom he is authorised to use force in terms hereof; | (i) Section 5(2)(i) ?is held to be invalid to the extent it authorises the officer of Police, armed forces and civil armed forces charged with the duty of preventing terrorism, to open fire or order for opening of fire against person who in his opinion in ?all probability ?is likely to commit a terrorist act or any scheduled offence, without being fined upon; | 4. Amendment of section 5. Act XXVII of 1997.-In the said Act, in section 5, in subsection (2), in clause (1), the comma and words or in all probability is likely to commit" shall be omitted. | No Amendment | | 2 | 10. Power to enter or search If any officer of the police, armed forces or civil armed forces is satisfied that there???? are reasonable grounds for suspecting that a person has possession ?of written material or ?a recording in contravention ?of section 8 he ?may enter ?and search ?the premises where it is suspected the material or recording is situated and ?take possession of the same. | (ii) section 10 of the Anti- Terrorism Act, 1997, hereinafter referred to as the Act in its present form is not valid; the same requires to be suitably amended as to provide that before entering upon premises which is suspected to have material or a recording in contravention of section 8 of the Act, the concerned officer of Police, armed forces or civil armed forces shall record in writing his reasons for such belief and serve on the person or premises concerned a copy of such reasons before conducting such???? search; | 8. Amendment of section' 10, Act XXVII of 1997.-In the said Act, in section 10, the full- stop????? at ??????? the end shall????? be replaced by a colon and thereafter, the following proviso shall be added, namely:-- Provided that the concerned officer shall first record in writing his reasons for such belief and serve a copy thereof either on the person or on the premises. | No Amendment |
| | | | | | | --- | --- | --- | --- | --- | | 3 4 5 6 7 8 9 10 11 12 13 | 14. Commission and appointment of Presiding Officers of Special Courts.-(1) A Special Court shall consist of a Judge, being a person who--- (i) is or has been a Sessions Judge or an Additional Sessions Judge; or (ii) has exercised the powers of a ?District Magistrate or an Additional Distt. Magistrate and has successfully completed an advance course in Shariah, (Islamic Law) conducted by the International Islamic University, Islamabad; or (iii) has for a period of not less than ten years been???? an advocate. (2) The Federal Government Shall make appointments to the post of Judge of Special Court after consultation with the Chief Justice of the High Court. Explanation.-- The qualification of being an advocate ?for a period of not ?less than ten years may he relaxed in the case of a suitable person who is a graduate from an Islamic University and has studied Islamic Shariah and Fiqh as a major subject. 19. Procedure and Dowers of Special Court.-- (10)????? Any accused??????????? person may be tried in his absence if the Special Court, after???? such inquiry as it deems fit, is satisfied that--- (b) the behaviour of the accused in Court has been such as to impede the course of justice and the Special Court has on the account ordered his removal from the Court: Provided that, in a case referred to in clause (a), the accused person shall not be tried unless?? a proclamation has been???? published in respect of him in at least three national daily newspapers out of which one shall be in Urdu language requiring him? to appear? at a specified place within seven days failing which?? action may also be taken against him? under section 88 of the Code: Provided further that the Special Court will proceed with the trial after taking the necessary steps to appoint an Advocate to defend the accused person who is not before the Court. Explanation.--An accused who is tried in his absence under subsection (1) shall be deemed not to have admitted the commission of any offence for which he has been charged. ??????????? 24. Appellate Tribunal.‑ There shall be one or more Appellate Tribunals for each Province consisting of one or two Judges of the High Court to be nominated by the Chief Justice of the said Court and notified by the Government. Explanation.‑‑In this section "High Court" means the High Court of the Province for which Special Court has been constituted. 25. Anneal.‑‑(1 ) An??????? appeal against the final judgment of Special Court shall lie to an Appellate Tribunal. (2) Copies of the judgment of a Special Court shall be supplied to the accused and the Public Prosecutor free of cost on the day the judgment is pronounced and the record of the trial Court shall????? be transmitted to the Appellate Tribu?nal within three days of the decision. (3) An appeal under subsection (1) may be preferred by a person sentenced by a Special Court to an Appellate Tribunal within seven days of the passing of the sentence. (4) The Attorney‑General or an Advocate? General may, on being directed by the Federal or a Provincial Government, file an appeal against an order of acquittal or a sentence passed by a Special Court within fifteen days of such order. (5) An appeal under this section shall be heard and decided by an Appellate Tribunal within seven working days. (6) An Appellate Tribunal shall sit at such places, and have jurisdiction within?? such territorial limits, as may be fixed by the Government. (7) Subject to subsection (8), an Appellate Tribunal shall, ?in exercise of its appellate jurisdiction, subject to the? provisions of this Act, have all the powers conferred on an Appellate Court?? under Chapter XXXI of the Code. (8) Pending the appeal the Appellate Tribunal shall not release the accused on bail. 26. Admissibility of confession made before office.‑ Not? withstanding anything contained in the Qanun‑e‑ Shahadat, 1984 (P.O.10? of 1984), a confession made by a, person accused of an offence punishable under section 7' or section 8 of this Act or an offence covered by subparagraph (3) of the Schedule to this Act, or robbery or dacoity with murder or rape before a police officer not below the rank of a Deputy Superintendent of Police may ?be proved against? such person: Provided????????? that Special Court may,???? for admission of the confession in evidence, require the police-officer to produce a video tape together with the devices used for recording the confession. 27. Punishment for??????? defective investigation.--If a Special Court or an Appellate Tribunal comes to the conclusion during the course of or at the conclusion of the trial that the Investigating Officer, or other Concerned ?Officers have failed to carry out the investigation properly or diligently or have failed to pursue the case properly and in breach of their duties, it shall be lawful for such Court or, as the case may be, Appellate Tribunal to punish?? the delinquent officers with imprisonment which?? may extend to two years,?? or with fine, or? with both by resort to summary proceedings. 28. Transfer of cases.- (1) Notwithstanding anything contained in this Act,????? an Appellate Tribunal may, if it considers it expedient so to do in the interest of justice, or where the convenience or safety of the witnesses or the safety of the accused so requires, transfer any case from one Special Court to another Special Court within or outside the area. (2) A??? Special Court to which a case???? is transferred under subsection (1) shall proceed with the case from the stage at which it was pending immediately before? such transfer and it shall not be bound to recall and re-hear any witness who has given ?? evidence and may act on the evidence already recorded. 30. Modified application of certain provisions of the Code.-(1) Notwithstanding Anything? contained in the Code or in any other law, every scheduled offence shall be deemed to be a cognizable offence within the meaning of clause (1) of section 4 of the Code and the words cognizable case" as defined in that?? clause shall be construed accordingly. (2) Sections 374 to 379 of the Code shall apply in relation to a case involving a scheduled offence subject to the modification that the references to a "Court? of Session" and "High??? Court", wherever occurring therein, shall be construed as reference to a "Special Court" and an Appellate Tribunal. (3)Notwith?standing the provisions?? of sections 439, 491, 496, 498A and 561 A of the Code, no Court other than a Special Court shall have the power? or jurisdiction??????? to grant bail to, or otherwise release, an accused person in a case triable by a Special Court. (4) A Special Court shall not release an accused person on bail if there are reasonable grounds for believing that he has been guilty of the offence with which he has???? been charged, and nor shall an accused person? be released unless the prosecution has been given notice to show cause why he should not be so released and the accused has furnished sound sureties. 34. Power to amend? the Schedule.‑‑ The Government may,???? by notification, amend? the Schedule so as to add any entry thereto or modify or omit any entry therein. 35. Power to make rules.‑‑The Government may,???? by notification, make such rules, if any, as it may deem??? necessary for carrying out the purposes of this Act. 37. Contempt ?of Court.-A special Court and an Appellate Tribunal shall have the power to punish with rigorous imprisonment for a term which may extend to six months with fine any person who-- (a) abuses, interferes with or obstructs the process of the Court or the Tribunal in any way or disobeys any order or direction of the Court; (b) scandalizes the Court Or Tribunal otherwise does anything??? which rids to bring the Court?? or Tribunal or a Person constituting the court into hatred, ridicule or contempt; (c) does anything which tends to prejudice the determination of a matter pending or most likely to come up before the court or Tribunal: or (d) does anything which, by any other??? law. Constitutes contempt????????? of Court or Tribunal. Explanation.--In this?????? section. "Court" means a special? Court and "Tribunal" means?? an Appellate Tribunal. | (viii) section 14 of the Act requires to be amended as to provide security of the tenure of the Judges of the Special Courts in consonance with the concept of independence of judiciary. (iii) Section 19 19 (1)(10)(b) of the Act, which provides for trial of an accused in absentia on account of his misbehaviour in' the Court, is violative of Article 10 of the Constitution and, therefore, is declared as invalid. (iii) sections 24, 25, 27, 28, 30 and 37 of the Act are also not valid in their present form as they militate against the concept of independence of judiciary and Articles 175 and 203 of the Consti?tution. They need to be amended as to vest????? the appellate power in a High Court instead? of Appellate Tribunal and to use the words "High Court" in place of "Appellate Tribunal". (iv) sections 24, 25, 27, 28, 30 and 37 of the Act are also not valid in their present form as they militate against the concept of independence of judiciary and Articles 175 and 203 of the Consti?tution. They need to be amended as to vest????? the appellate power in a High Court instead? of Appellate Tribunal and to use the? words ?High Court ? in place of Appellate Tribunal: (v) Section 26 of the Act is not valid in its present form as it makes admissible the confession recorded by a????????? police officer not below the rank of a Deputy Superintendent of Police as it is violative of Articles 13(b) and 25 of the Constitution and that the same requires to be suitably amended by substituting the words 'by a police officer not below the rank of a Deputy Superintendent of Police' by the words 'Judicial Magistrate'; (iv) sections 24, 25, 27, 28, 30 and 37 of the Act are also not valid in their present form as they militate against the concept of independence of judiciary and Articles 175 and 203 of the Constitution. They need to be amended as to vest????? the appellate power in a High Court instead? of Appellate Tribunal and to use the words "High Court" in place of "Appellate Tribunal"; (iv) sections 24.25, 27, 28, 30 and 37 of the Act are also not valid in their present form as they militate against the concept of independence of judiciary and Articles 175 and 203 of the Constitution. They need to be amended as to vest????? the appellate power in a High Court instead? of Appellate Tribunal and to use the words "High Court" in place of "Appellate Tribunal"; (iv) sections 24, 25, 27, 28, 30 and 37 of the Act are also not valid in their present form as they militate against the concept of independence of judiciary and Articles 175 and 203 of the Constitution. They need to be amended as to vest the appellate power in a High Court instead? of Appellate Tribunal and to use the words "High Court" in place of "Appellate Tribunal"; (vi) That the offences mentioned in the Schedule should have nexus with the objects mentioned in sections 6, 7 and 8 of the Act; (vii) section 35 of the Act in its present form is not valid as it militates against the concept of the independence. of judiciary and is also violative of Articles 175 and 203 of the Constitution and, therefore, it needs to be suitably amended inasmuch as the power to frame??? rules is to be vested in the High court To be Notified by The Government; (iv) sections 24, 25, 27, 28, 30 and 37 of the Act are also not valid in their present form as they militate against the concept of independence of judiciary and Articles 175 and 203 of the Constitution. They need to be amended as to vest????? the appellate power in a High Court instead? of Appellate Tribunal and to use the words "High Court" in place??? of "Appellate Tribunal": officer not below the rank of a Deputy Superintendent of Police as it is violative of Articles 13(b) and 25 of the Constitution and that the same requires to be suitably amended by substituting the words 'by a police officer not below the rank of a Deputy Superintendent of Police' by the words 'Judicial Magistrate'; | 10. Amendment of section 14, Act XXYII of 1997.--In the said Act, in section14,-- (a) in subsection (1), in clause (iii) after the word "Advocate" at the end the words?? "of a High???? Court" shall be added; and (b) For subsection (2), the??????? following shall????? be substituted, namely:-- "(2) A Judge shall be appointed for a period of two and a half years ?after consultation with the Chief Justice of the High Court." 12. Amendment of section 19, Act XXVII of 1997.-In the said Act, in section 19;-- (i) for subsection (10), the following shall????? be substituted, namely:-- "(10) any accused person may?????? be tried in his absence if the???? Anti Terrorism???????? Court ? after such inquiry as it deems fit, is satisfied that such absence??????????? is deliberate????? and brought about with a view to impeding the course of justice: Provided that the Accused persons shall trot be tried under this subsection unless a proclamation has been published in respect of him in at least three national daily???? newspapers , out of which one shall be in Urdu language requiring him to appear at a specified place within seven days failing??? which action may also be taken against him under section 88 of the Code: Provided further that the Court shall proceed with the trial after taking?? the necessary steps to appoint an Advocate at????? the expense of??????? the State to defend the Accused person who is not before the Court. Explanation.--An accused who is tried in his absence under this sub?section shall be deemed not to have admitted the commission of any offence for which he has been charged.": and (ii) after sub?section (11), the following new subsection shall be inserted, namely:‑‑ (11‑A)Nothing contained in subsection (11) shall be construed to deny the accused the right to consult or be defended by a legal practitioner of his own choice. 13. Amendment of section 24, Act XXVII of 1997.‑?In the said Act, section 24 shall be omitted. 2.General Amendments. Act XXVII of 1997. ?In the Anti- ?Terrorism Act, 1997 (XXVII of 1997),? hereinafter referred to as the said Act,‑‑ Court", . "a High Court" or "the High Court" shall be substituted respectively. (b) for the words "Appellate Tribunal", or "the Appellate Tribunal" wherever occurring the words "High Court", "a High Court" or "the????? High Court" shall be substituted respectively. 15.Amendment of section 26, ?Act XXVII of 1997. In the said Act, section 26 shall be omitted. 2. General Amendments, Act XXVII of 1997.-In the Anti-Terrorism Act,????? 1997 (XXVII??????????? of 1997), hereinafter referred to as the said Act,-- (b) for the words "Appellate Tribunal" or "the Appellate Tribunal" wherever occurring the words "High Court", "a High Court" or "the????? High Court" shall he substituted respectively. 16. Amendment of section 28, In the Anti- Terrorism Act XXVII of 1997.-In the said Act, in section 28, in subsection (2) ?the full-stop at the end shall be replaced by a colon and thereafter the following proviso shall be added, namely:-- "Provided that nothing herein contained shall affect the powers of ?the presiding officer of the Special Court to call any witness as is available under the law." 2. General Amendments. Act XXVII of _1997.-In the Anti-Terrorism Act, 1997 (XXVII of 1997), hereinafter referred to as the said Act,-- (b) for the words "Appellate Tribunal"?????????? or "the Appellate Tribunal" wherever occurring????????? the words "High Court", "a High Court" or "the????? High Court" shall be substituted respectively. No?????? Amend?ment. No?????? Amend?ment. Substitution of section 37. Act XVVII of 1997.-In die said Act, for section 37, the following shall be substituted, namely:-- "37. Contempt of Court.--An Anti-Terrorism Court?? shall have the power to punish with imprisonment for a term which tray extend to six months and with fine any person who-- (a) abuses, interferes with or obstructs the process of the Court in any way or disobeys ?any order or direction of the Court; (h) scandalize the Court otherwise does anything which rends to bring the Court or a person constituting the Court into hatred, ridicule or contempt. (c) does anything, which tends to prejudice the determination of a matter pending or most likely to come??? up before? the Court: of (d) does anything which, by any other??? law, constitute contempt of Court. Explanation. In this section, "Court" means "Anti‑Terrorism Court. ". | No Amendment No Amendment No Amendment No Amendment No Amendment No Amendment No Amendment No Amend?ment No Amendment No Amendment No Amend?ment No Amend?ment No Amend?ment |
Mr. M. Akram Sheikh, learned Senior Advocate Supreme Court for the petitioners argues that the provisions of Ordinance IV of 1999 and Ordinance XIII of 1999 are inconsistent and repugnant to the Fundamental Rights and also are in derogation of the guidelines laid down by this Court in Mehram Ali's case (supra). However, after arguing the case at some length from various angles on the touchstone of Fundamental Rights and the ruling by this Court in the case of Mehram Ali (supra), his first objection is that the amendment through the impugned Ordinance is section 5 of the act by providing just omission of the expression "or in all probability is likely to commit" which has already been declared as void would be of no effect, in that, the Supreme Court in the case of Mehram Ali (supra) specifically held section 5(2)(i) to be invalid to the extent it authorises the officer of Police, Armed Forces and Civil Armed Forces charged with the duty of preventing terrorism, "to open fire or order for opening of fire against person who in his opinion in all probability is likely to commit a terrorist act or any scheduled offence, without being fired upon" and therefore, by not doing so that provision is contrary to the judgment in Mehram Ali's case (supra).
Mr. Aziz A. Munshi, learned Attorney‑General submits that section 5(2)(i) of the Act has not been suitably amended due to inadvertence and/or error on the part of the draftsman. He emphasised that this Court may reasonably interpret the above provision in consonance with the mandate enshrined in paragraph (1) of the short order rendered in the case of Mehram Ali (supra).
We are inclined to agree that the provisions of section 5(2)(i) of the Act were not suitably amended as expressly mandated by this Court. If the provisions of section 5 of the Act in their present form are given effect to, it will create horrible and far‑reaching consequences, inasmuch as, the law enforcing agencies cannot be given a licence to kill indiscriminately any persons who are allegedly involved in committing terrorist acts as defined under the Act or any of the scheduled offences. Clearly, such a right is to be exercised as a preventive measure and not made basis for launching an attack for retaliation, lest it would tantamount to legalising alleged police encounters/extra judicial killings in the garb of exercise of power by a Police Officer vesting in him under section 5(2)(i) of the Act.
Such a course can never be countenanced in a civilised society, particularly, in Pakistan, where Islam is the State religion. It would also militate against the Objectives Resolution forming substantive part of the Constitution under Article 2A thereof, wherein it is, inter alia, provided that the Muslims shall be enabled to order their lives in the individual and collective spheres in accordance with the teachings and requirements of Islam as set out in the Holy Qur'an and Sunnah. Reference may be made to a book entitled? ?BUNIADI HAKOOK? by Muhammad Salahuddin, in Chapter (ISLAM KAY ATTA KARDA BUNIADI HAKOOK ) whereof at page No.241 under the caption (TUHAFZAY JAAN) he maintains:
Furthermore, all the offences mentioned in the Act are not punishable with death, but are also punishable with imprisonment for life, or with rigorous imprisonment for various terms. For instance:
_______________________________________________________________________________________
Section ??????????? Offence??????????????????????????????????? Punishment under the Pakistan
??????????????????????? Penal Code
_____________________________________________________________________________________
302 ???????????????? Qatl‑i‑Amd????????????????????????????? Qisas, or death, imprisonment for life or
??????????? imprisonment up to twenty‑five years.
295‑A????????????? Maliciously insulting the ??????????? Imprisonment of either description for
??????????? religion or the religious ten years or fine or both.
??????????? beliefs of any class
298‑A????????????? Use of derogatory???????????????????? Imprisonment of either description
??????????? remarks etc. in respect????????????? for three years and fine or both.
??????????????????????? of holy personages.
364????????????????? Kidnapping or abducting???????? Imprisonment for life or rigorous
? ??????????????????????in order to murder, ?????? ?????????????imprisonment for ten years and fine.
364‑A????????? Kidnapping or abducting??????????? Death or imprisonment for life
??????????????????? a person under the age????????????????? or rigorous imprisonment
??????????? ???????of fourteen.??????????? ??????????????????????? for a term which may extend
??????????????????????????????????????????????? ??????????????????????? to fourteen years and shall not
??????????????????????????????????????????????? ??????????????????????? be less than seven years.
365????? ???? Kidnapping or abducting????? ??????????? Imprisonment of either description for
???????????????? with intent to secretly and??????????? seven years and a fine.
???????????????? wrongfully confine a
??????????? ???? person.
It is incumbent upon the police force to act so as to enforce Article 9 of the Constitution, given in Chapter 1 thereof, which provides that no person shall be deprived of life or liberty save in accordance with law rather than to violate the same and expose itself to criminal prosecution. In this regard the principles enshrined in sections 99 to 106 of the Pakistan Penal Code are also instructive, which contemplate that police personnel cannot exercise the right of private self‑defence more than what has been directed in the above sections. It would be advantageous to reproduce the above provisions of the Pakistan Penal Code, 1860, which read thus:
"99. Acts against which there is no right of private defence.‑‑There is no right of private defence against an act which does not reasonably cause the apprehension of death or of grievous hurt, if done, or attempted to be done by a public servant acting in good faith under colour of his office, though that act may not be strictly justifiable by law.
There is no right of private defence against an act which does not reasonably cause the apprehension of death or of grievous hurt, if done, or attempted to be done, by the direction of a public servant acting in good faith under colour of his office though that direction may not be strictly justifiable by law.
There is no right of private defence in cases in which there is time to have recourse to the protection of the public authorities.
Extent to which the right may be exercised.‑‑The right of private defence in no case extends to the inflicting of more harm than it is necessary to inflict for the purpose of defence.
Explanation 1.‑‑A person is not deprived of the right of private defence against an act done, or attempted to be done, by a public servant, as such, unless he knows, or has reason to believe that the person doing the act is such public servant.
Explanation 2.‑‑A person is not deprived of the right of private defence against an act done, or attempted to lie done by the direction of public servant, unless he knows, or has reason to believe, that the person doing the act is acting by such direction, or unless such person states the authority under which he acts, or if he has authority in writing, unless he produces such authority, if demanded.
First. Such an assault as may reasonably cause the apprehension that death will otherwise be the consequence of such assault.
Secondly. Such an assault as may reasonably cause the apprehension that grievous hurt will otherwise be the consequence of such assault.
Thirdly. An assault with the intention of committing rape.
Fourthly. An assault with the intention of gratifying unnatural lust.
Fifthly. An assault with the intention of kidnapping or abducting.
Sixthly. An assault with the intention of wrongfully confining a person, under circumstances which may reasonably cause him to apprehend that he be unable to have recourse to the public authorities for his release.
When such right extends to causing any harm other than death.‑‑If the offence be not of any of the descriptions enumerated in the last preceding section, the right of private defence of the body does not extend to the voluntary causing of death to the assailant, but does extend, under the restrictions mentioned in section 99, to the voluntary causing to the assailant of any harm other than death.
Commencement and continuance of the right of private defence of the body.‑‑The right of private defence of the body commences as soon as a reasonable apprehension of danger to the body arises from an attempt or threat to commit the offence though the offence may not have been committed; and it continues as long as such apprehension of danger to the body continues.
When the right or private defence of Property extends to causing death.‑‑The right of private defence of property extends, tinder the restriction mentioned in section 99, to the voluntary causing of death or of any other harm to the wrongdoer, if the offence, the committing of which, or the attempting to commit which, occasions the exercise of the right, be an offence of any of the descriptions hereinafter enumerated, namely‑.
First. Robbery;
Secondly. House‑breaking by night.
Thirdly. Mischief by fire committed on any building, tent or vessel, which building, tent or vessel is used as a human dwelling or as a place for the custody of property;
Fourthly. Theft, mischief or house‑trespass, under such circumstances as may reasonably cause apprehension that death or grievous hurt will be the consequence, if such right of private defence is not exercised.
When such right extends to causing any harm other than death..‑‑if the offence, the committing of which, or the attempting to commit which, occasions the exercise of the right of private defence, be theft, mischief, or criminal trespass, not of any of the descriptions enumerated in the last preceding section, that right does not extend to the voluntary causing of death, but does extend, subject to the restrictions mentioned in section 99, to the voluntary causing to the wrongdoer of any harm other than death.
Commencement and continuance of the right of private defence of property.‑‑The right of private defence of property commences when a reasonable apprehension of danger to the property commences.
The right of private defence of property against theft continues till the offender has affected his retreat with the property or either the assistance of the public authorities is obtained or the property has been recovered.
The right of private defence of property against robbery continues as long as the offender causes or attempts to cause to any person death or hurt or wrongful restraint or as long as the fear of instant death or of instant hurt or of instant personal restraint continues.
The right of private defence of property against criminal trespass or mischief continues as long as the offender continues in the commission of criminal trespass or mischief.
The right of private defence of property against house‑breaking by night continues as long as the house‑trespass which has been begun by such house‑breaking continues.
Right of private defence against deadly assault when there is a risk of harm to innocent person.‑‑If in the exercise of the right of private defence against an assault which reasonably causes the apprehension of death, the defender be so situated that he cannot effectually exercise that right without risk of harm to an innocent person, his right of private defence extends to the running of that risk. "
In Ch. Muhammad Yaqoob and others v. The State and others 1992 SCMR 1983, this Couft white examining the defence plea of encounter in terms of section 99 of the P.P.C. and after examining the cases of Ali Mea v. King‑Emperor AIR 1926 Cal. 1012, Ahmad Nawaz v. The State 1970 SCMR 597 and Mashal Khan v. The State PLD 1988 SC 25 observed as under:‑‑
"On the basis of the above authorities, one can urge that once the right to exercise private self‑defence is established, the same cannot be defeated lightly, but at the same time, the force used must be in proportion to the injury to be averted and must not be employed for the gratification of vindictiveness or malicious feeling. The right of private self‑defence is to be used as a shield to ward off an unwarranted attack to person or property but it cannot be used as a vehicle for provoking an attack. In other words, it is to be exercised as a preventive measure and not for launching an attack for retaliatory purpose. The Court will have to examine the above question with reference to the facts of each case and keeping in view the state of mind of the person placed in the position of the person attacked, who exercises the right of private defence. The Court, while examining the above question, will not measure his action in golden scales but would extend due concession on account of human error of judgment in such a situation. Since, in the present case, we have held that there was no police encounter, the question of exercising right of private self‑defence by the convicts did not arise. We may observe that Mr. Minto, learned counsel for the appellants, has not been able to point out any provision of law whereby the police personnel can exercise right of private self‑defence more than what has been provided for in sections 96 to 106, P.P'C. In this view of the matter, simpliciter, an encounter will not entitle a police party to kill indiscriminately the persons who are allegedly involved in the encounter as the basic requirement provided inter alia in section 99, P.P.C. namely, 'the right of private defence in no case extends to the inflicting of more harm than it is necessary to inflict for the purpose of defence', will be very much applicable. Secondly, the police personnel themselves cannot be the sole arbiter on the question, whether the killing of certain persons in an alleged encounter was warranted by the facts of the case but it is for the competent Court of law to decide the above question. We may further observe that Article 9 given in Chapter 1 of the Constitution of the Islamic Republic of Pakistan containing the Fundamental Rights guarantees that 'no person shall be deprived of life or liberty save in accordance with law' and, therefore, the public functionaries like police force, are to act in aid of the enforcement of the above Constitutional provision rather than to violate the same and expose themselves to criminal prosecution."
The Government should have kept in view the law declared by this I Court in the case of Ch. Yaqoob (supra) and Mehram Ali (supra). We, therefore, hold that section 5(2)(i) of the Act as introduced by Ordinance XIII of 1999 to the extent indicated above is violative of Article 9 of the Constitution as well as the guidelines provided in the case of Mehram Ali (supra) and the same is held to be invalid to the above extent and requires to be suitably amended.
The second objection is that the provision of the impugned Ordinance XIII of 1999 in so far as inserting section 7‑A into the Anti?-Terrorism Act, 1997, by including illegal strikes, go‑slows, lock‑outs as "civil commotion" and providing punishment for the same militates against the Fundamental Right of freedom of expression provided in Article 19 of the Constitution and is also inconsistent with the labour laws of the country which ensure observance of various Fundamental Rights. It is argued that the phrases "internal disturbance", "illegal strikes", are vague and unreasonable. The learned Attorney‑General also states that the above provision should be reasonably interpreted, in that, the citizens are entitled, to know as to what constitutes the offence of "civil commotion" in the context of "internal disturbances" and "illegal strikes".
The learned counsel for the petitioners and the learned Attorney-?General have not drawn our attention to any other statute wherein definition of the term "internal disturbances" has been given. The above term has not been defined in the Constitution. Under Article 232 thereof, it is merely stated thereunder that "internal disturbances" refer to. those disturbances which are beyond the power of the Provincial Government to control. ~Therefore, while construing the term "internal disturbances" the term is to be understood in terms of general parlance. "Internal disturbances" in the context of civil commotion may include an outbreak of large scale violence due to disturbances in any part of the country. The term "strike" is popularly used in labour laws of the country and is generally understood as a simultaneous cessation of work on the part of the workmen, and its legality or illegality depend on the means by which it is enforced and upon its object having reference to specific provision in the relevant laws. The "strike" is the combined effort of workmen to obtain higher wages or other concessions and privileges from their employers by stopping work at a pre‑concerted time until their demands are met. The question as to whether a call of strike given by workmen or members of Labour Union or members of the Union of workers/employees is lawful or otherwise depends upon the facts and circumstances of each case having regard to the specific provisions laid down in the relevant statutes and the object sought to be achieved. Distinction between lock‑out and strike is depicted in a case from American jurisdiction Dail‑Overland Co. v. Willys‑Overland, D.C. Ohio, 263 F.171, 186, wherein it was observed that "A 'strike' where men quit because the employer refuses conditions demanded of him, and a 'lock‑out' where employees refuse to return to work unless the employer meet their demands". (Refer Words and Phrases, Permanent Edition, Volume 40, p.471). In City of Wilmington v. General Teamsters Local Union 326 Del., 321 A.2d 123, 126, it was held that "In order for there to be a 'strike,' there must be some concerted action or combined effort by group which is designed to exert pressure on an individual or entity to accede to certain demands."
Lock‑out distinguished from strike
Work stoppage is a lock‑out and not a strike. However, in certain conditions a "work stoppage" may be synonymous with the word "strike", for instance, where stoppage of work may arise because of strike, but picketing by employees during work stoppage as a result of lock‑out generally does not mean that the employees were on "strike". Strikes and lock‑outs in labour or industrial disputes may be permissible as well as impermissible, legal as well as illegal, depending upon the facts of each case with reference to the relevant provisions in the relevant statute. Strike is also understood to mean cessation of economic activity including ' Paiyya Jam (Wheel Jam) and closure of shops and establishments at the call of a political party to press for their political demands in furtherance of their manifesto, policies or programmes. Strike may also be in the nature of sympathy strike which is a common manifestation of traditional solidarity with a cause. Sympathy strikes are a common manifestation of national solidarity on any national or international cause in endeavouring to preserve and strengthen a noble cause. Sit down strike is generally observed at the call of a political party by resorting to "Dherna" (sit down).
CIVIL COMMOTION:
"A 'civil commotion' is an uprising among a mass of people which occasions a serious and prolonged disturbance and infraction of civil order not attaining the status of war or an armed insurrection, and is a wild irregular action of many persons assembled together.
A 'commotion' is defined to be a tumult and tumult to be a. promiscuous commotion of a multitude; an irregular violence, a wild commotion. A 'civil commotion', therefore, requires the wild or irregular action of many persons assembled together.
A 'civil commotion' is an insurrection of the people for general purposes, though it may not amount to a rebellion while there is a usurped power."
DISTURBANCE
Any conduct contrary to the usages of a particular sort of meeting and class of persons assembled, and which interferes with its due progress or is annoying to the assembly in whole or in part is a 'disturbance'. ??????????
'Disturbance' is defined as any conduct which, being contrary to the usages of the particular sort of meeting and class of persons assembled, interferes with its due progress and services, or is annoying to the congregation in whole or in part.
It would be advantageous to refer here the meaning of the word "vague":
"Vague" means allusive, ambiguous, broad, debatable, disputable, dubious, equivocal, evasive, impalpable, imponderable, inapprehensible, inarticulate, incomprehensible, inconspicuous, indefinite, indeterminate, indistinct, inexact, inexpressive, inscrutable, insubstantial, intangible, nebulous, non‑committal, oblique (evasive), obscure (faint), opaque, open‑ended, problematic, uncertain (ambiguous), unclear, undecided, undefinable (Legal. Thesaurus, Regular Edition, by William C. Burton).
"Vague": Indefinite. Uncertain; not susceptible of being understood. For purposes of determining whether statute is constitutionally infirm by reason of being vague, statute is "vague" if its prohibitions arc not clearly defined (Black's Law Dictionary (Sixth Edition) by Henry Compbell Black).
Clearly, the language of the statute and, in particular, statute creating an offence must be‑precise, definite and sufficiently objective so as to guard against an arbitrary and capricious action on the part of the State functionaries who are called upon to enforce the statute. It is well.‑settled that penal statutes contemplate notice to ordinary person of what is prohibited and what is not. Mr. M. Akram Sheikh, learned A.S.C. for the petitioners, was right in contending that Article 4 of the Constitution relating to the rights of individual to be dealt with in accordance with law, is in the nature of "due process" clause. To enjoy protection of law and to be treated in accordance' with law is the inalienable right of every citizen and no action detrimental to the life, liberty, body, reputation or property of any person shall be taken except in accordance with law. No person shall be prevented from or be hindered in doing that which is not prohibited by law and no person shall be compelled to do that which the law does not require him to do. Every citizen has the inalienable right under the Constitution to know what is prohibited by law and what the law does not require him to do. It is, therefore, incumbent upon the State to express in clear terms susceptible of being , understood by an ordinary citizen of what is prohibited and to provide definite standards to guide discretionary actions of Police Officers so as to prevent arbitrary and discriminatory operation of section 7‑A of the Act. In other words, it must be spelt out from a bare reading of section 7‑A as to what constitutes "internal disturbances", "illegal strikes", "go‑slows" and "lock‑outs" in terms of section 7‑A of the Act.
It is the duty of the Court to find out the true meaning of a statute while interpreting the same. The general rule is that the Courts adopt as uniform an approach as possible to the reading of ambiguous Acts of Parliament which are some times imperfect, obscure and vague. Refer Nairn v. University of St. Andrews (1909) AC 147, at p.161. The primary rule of interpretation of statutes is that the meaning of the Legislature is to be sought in the actual words used by him which arc to be interpreted in their ordinary and natural meaning. (Refer Bhawani Lal's Interpretation of Statutes, p.2). The cardinal rule for the construction of Acts of Parliament is that they should be construed according to the intention expressed in the Acts themselves (Craies on Statute Law, 7th Edn. pp.64‑65). Where the language of the statute is plain and unambiguous, and conveys a clear and definite meaning, there is no occasion for resorting to the rules of statutory interpretation, and the Court has no right to impose another meaning or to read into its limitations which are not there, based on a prior reasoning as to the probable intention of, the Legislature (see Bindra on Interpretation of Statutes, 7th Edn., p.478). This Court in the case of Ms Benazir Bhutto v. Federation of Pakistan PLD 1988 SC 416 and AI‑Jehad Trust v. Federation of Pakistan PLD 1996 SC 324 resorted to the proceedings of the Legislature when the language employed was ambiguous. In Fisher v. Bell (1961) 1 QB 394, a shopkeeper was accused of offering a flick‑knife for sale by putting it in his shop‑window. The question arose whether 'offer' was used in its popular sense or technical. Held, it was used in its technical sense in the law of contract, under which placing goods in a shop‑window does not constitute an offence. The controversy in the above case arose out of section 1(1) of the Restriction of Offensive Weapons Act, 1959 which provided that any person 'who manufactures, sells or offers for sale or hire, or lends or hires to any other person' any flick‑knife is guilty of an offence. It was observed that the Act being to a large extent addressed to shopkeepers it was passed with reference to a particular trade.
Under section 2(xxv) of the Industrial Relations Ordinance, 1969 the terms "strike", "lock‑out", illegal strike", "illegal lock‑out" have been defined as under:‑‑
"Strike" means cessation of work by a body of persons employed in any establishment acting in combination or a concerted refusal or refusal under a common understanding of any number of persons who have been so employed to continue to work or to accept employment.
"Lock‑out" means the closing of a place of employment of part of such place or the suspension, wholly or partly, of work by an employer, or refusal, absolute or conditional, by an employer to continue to employ any number of workmen employed by him where such closing, suspension or refusal occurs in connection with an industrial dispute or is intended for the purpose of compelling workmen employed to accept certain terms and conditions of or affecting employment;
"Illegal strike" means a strike declared, commenced or continued otherwise than in accordance with the provisions of this Ordinance.
"Illegal lock‑out" means a lock‑out declared, commenced or continued otherwise than in accordance with the provisions of this Ordinance.
The meaning of "illegal strikes" are since doubtful the same may be ascertained by a reference to the words associated with it by applying the rule of Noscitur a. sociis. The rule that a word is known by the company it keeps, is not an ineluctable rule. It is applied wisely only where a word is capable of many meanings so that giving an unintended breadth to a statute may be avoided. Refer "Interpretation of Statutes" by Vepa P. Sarathi.
It is well‑settled rule of construction of statutes that if the words used are ambiguous and admit of two constructions and one of them leads to a manifest absurdity or to a clear risk of injustice and the other leads to no such consequence, the second interpretation must be adopted. Thus, for the smooth operation of the law and the purposes for which it has been enacted i.e. to provide for the prevention of terrorism, sectarian violation and for speedy trial of heinous offences, we are inclined to hold that the above terms have not been used in the restrictive sense but in a broader sense.
When faced with this Mr. Aziz A. Munshi, learned Attorney?-General did not dispute the above proposition of law but submitted that the terms "illegal strike", "go‑slows" and lock‑outs" are to be read as ejusdem generis with the' term "internal disturbances" in the context of "civil commotion" as envisaged by section 7‑A of the Act.
"However, the doctrine will apply when there is nothing in the provision or Act to show a wider sense was not intended or the intention to give to the general term a broader meaning than the doctrine requires was not manifested.
According to 'Maxwell on the Interpretation of Statutes, 12th Edition, page 297, it is a well‑established rule in the construction of statutes that general terms following particular ones apply only to such persons or things as are ejusdem generis with those comprehended in the language of the Legislature, R. v. Cleworth (1864) 4 B. & 5.927 per Cockburn C.J. at 932. In other words, the general expression is to be read as comprehending only things of the same kind as that designated by the preceding particular, expressions, unless there is something to show that a wider sense was intended (emphasis supplied). Reference is made by the author to R. v. Edwardson (1859) 28 L.J.M.C. 213).
According to Corpus Juris Secundum, Volume 82, page 658, the rule of doctrine of 'ejusdem generis' will apply unless intention to the contrary is clearly shown. The relevant passage may be quoted here. It reads:
'Where general words follow the enumeration of particular classes of persons or things, the general words, under the rule or maxim of construction known as 'ejusdem generis', will be construed as applicable only to persons or things of the same general nature or class as those enumerated, unless an intention to the contrary is clearly shown.'
J.G. Sutherland, in his book "Statutes and Statutory Construction (Third Edition) in section 4910, at page 400 has stated that the doctrine applies when the following five conditions exist‑‑
(1) the statute contains an enumeration by specific words;
(2) the members of the enumeration constitute a class;
(3) the class is not exhausted by the enumeration;
(4) a general term follows the enumeration; and
(5) there is not clearly manifested an intent that the general term be given a broader meaning than the doctrine requires. "
The question still remains to be solved that in the absence of clear, certain and definite expression of the phrase "internal disturbances" not susceptible of being understood in terms of the language employed therein, an ordinary citizen will have no notice of what disturbances are prohibited which tantamount to "internal disturbances" in the context of "civil commotion" as defined in section 7‑A of the Act. It is difficult to give an exhaustive definition of the term "internal disturbances". It may be understood in the context of run down of the law and order situation in the country. Disturbances resulting in loss of life and property, disturbances resulting from large scale clashes between various factions of the people, or where a Government finds it difficult to maintain law and order, to run the ordinary administration of the country, to keep open educational institutions and to ensure normal economic activity and functioning of the various State institutions could be termed as internal disturbance, lepending upon the language in a statute. It is essential to define in clear an definite terms as to what constitutes an act of civil commotion in unambiguous words without derogation to the rights of the citizens to the enjoyment of rights guaranteed under Article 4 (rights of individuals to be dealt with in accordance with law). Article 9 (security of person), Article 14 (inviolability of dignity of man), Article 16 (freedom of assembly) and Article 27 (equality of citizens) and Article 19 (freedom of speech and expression) and there shall be freedom of the press, subject to any reasonable restriction imposed by law in the 4 interest of the glory of Islam or the integrity, security or defence of Pakistan w or any part thereof, friendly relations with foreign States, public order, decency or morality, or in relation to contempt of Court, commission of or incitement to an offence.
We are not persuaded to accept that the terms "illegal strike", "lock?out" and "go‑slow" are to be read in the context of Labour Laws, as argued by the learned Deputy Attorney‑General. The learned Attorney‑General was right in arguing that the above words are to be read ejusdem generis with the word "internal disturbances". However, the difficulty is that the words "internal disturbances" used in section 7‑A are vague. The term "internal disturbance" may have various meaning depending upon the context in which it is used. The words "internal disturbance" and "civil commotion" connote temporary outbreak of unlawful violence, whereby the ordinary business of. the community is, more or less, interrupted and it has the effect of uprising among the masses which occasion a serious and prolonged disturbance and, insurrection. Civil disorder not attaining the situation of war or an armed insurrection, is a wild and irregular action with many persons assembled together. "Internal disturbance" is a disturbance occurring in any part of the country which wrongfully interferes with the general tranquillity in social and ordinary life of the people under the Constitution and the law. The meaning of the term "internal disturbances", "illegal strike", lock‑out" and "go‑slow" must be expressed in definite terms for the purposes of section 7‑A of the Act, in that, it would not be in the interest of justice to leave it to a Police Officer to apply the law which is vague and unintelligible. Constitutional guarantee of the Fundamental Right to have a fair trial is spelt out from Article 9 of the Constitution. An accused is not only entitled to pre‑trial disclosure by the prosecution to the defence of relevant material specially the statement of witnesses under section 161, Cr.P.C. but also pre‑commission disclosure of the offence before being tried. It is the duty of the State to disclose in the law as to what constitutes an offence. Viewed from that angle section 7‑A of the impugned Act to the extent indicated above is unconstitutional, in that, it infringes the presumption of innocence and does not meet the condition of reasonableness due to vagueness. Every citizen has a constitutional right to lead his life in accordance with law and what is not prohibited by law, The vague definition of the words "internal disturbances", "illegal strike" "lock‑out" and "go ?slow", if allowed to continue in the statute in their present form, could lead R to imbalance in individual and community rights.
We, therefore, hold that section 7‑A of the impugned Act to the extent indicated above is invalid being repugnant to the Constitution and requires to be suitably amended.
The third objection is that in the absence of security of tenure for the incumbent in the office of Judge of the Courts set up under the Anti?terrorism Act section 14 of the Act is violative of the concept of independence of Judiciary, guidelines whereof have been enunciated to the case of Mehram Ali (supra) as well as the case of Sh. Liaquat Hussain v Federation of Pakistan (PLD 1999 SC 504) relating to establishment of Military Courts in Karachi under Ordinance XII of 1998 as amended subsequently. The precise submission of the learned counsel for the petitioners is that in the Short Order it was specifically, mandated that section 14 of the Act should be suitably amended so as to provide security of tenure of the Judges of the Special Courts in consonance with the concept of independence of Judiciary. This direction has not been complied with, Through Ordinance XIII of 1990 amendment has been introduced in section 14 of Act XXVIII of 1997 wherein subsection (2) of the old Act has been amended as follows:
"(a)?????? in subsection (1), in clause (iii) after the word "advocate" at the end the words "of a High Court" shall be added: and
(b)??????? for subsection (2), the following shall be substituted, namely:
(2)??????? Subject to the provisions of subsection (4), the Federal Government or the Provincial Government, if directed by the Federal Government to establish a Court under this Act, shall after consultation with the Chief Justice of the High Court, appoint a Judge of each Court.
(3)??????? A Judge shall hold office for a period of two and a half years but may be appointed for such further term or part of term as the Government appointing the Judge may determine.
(4)??????? A Judge may be removed from his office prior to the completion of the period for which he has been appointed after consultation with the Chief Justice of the High Court."
20.?????? We find that section 14 has been suitably amended in consonance with the principles laid down in Mehram Ali and Al‑Jehad Trust cases. The appointment of the Judges of the Anti‑Terrorism Courts have to be made by the Federal Government or the Provincial Government, as the case may be, in consultation with the Chief Justice of the High Court concerned. Statutory tenure of 2‑1/2 years has also been guaranteed and a Judge once appointed cannot be removed prior to the completion of the period for which he has been appointed, except/after consultation with the Chief Justice of the High S Court concerned. It is inconceivable that the Chief Justice of a High Court would recommend arbitrary removal of any Judge of the Anti‑Terrorism Court in contravention of his statutory tenure except on ground .of misconduct.
It would be advantageous to reproduce the controversial section 35 of the Act which reads thus:
"35. Power to make rules.‑‑(1) A High Court may make such rules, T if any, as it may deem necessary for carrying out the purposes of this Act.
(2)??????? The rules made under subsection (1) shall be notified by the Government in the official Gazette."
When faced with this, the learned Attorney‑General again submitted that this appears to be a case of inadvertence on the part of the draftsman in the Ministry of Law, Justice and Parliamentary Affairs, in that, it is unimaginable that any direction/order passed by the Supreme Court is not complied with. If that is so, we expect that in future the draftsman in the Law Ministry would be more careful and vigilant in following the decisions of this Court. Suffice it to say, that under Article 190 of the Constitution all Executive and Judicial Authorities throughout Pakistan are bound to act in aid of the Supreme Court. Therefore, this section be suitably amended as directed in the case of Mehram Ali (supra).
We have .not dilated upon other provisions of the impugned Ordinance, in that, the same have not been seriously objected to. We have also found them to be intra vires and not in conflict either with the provisions of the Constitution or the guidelines provided in the case of Mehram Ali (supra).
In the result, we hold that:
(i)Section 5 (2)(i) of the Act as introduced by Ordinance XIII of 1999 to the extent indicated above is violative of Article 9 of the Constitution as well as the guidelines provided in the case of? Mehram Ali (supra) and the same is held to be invalid to the above extent and requires to be suitably amended;
(ii) section 7‑A of the impugned Ordinance to the extent indicated above is invalid being repugnant to the Constitution and requires to be suitably amended. Commencement or continuation of illegal strikes, go‑slows and lock‑outs mentioned in section 7‑A should have nexus with the objects mentioned in sections 6, 7 and 8 of the Act.
(iii)?????? section 14 has been suitably amended in consonance with the principles laid down in Mehram Ali and Al‑Jehad Trust cases; and
(iv)?????? section 35 of the Act in its present form is not valid as it militates against the concept of the independence of judiciary and is also violative of Articles 175 and 203 of the Constitution and, therefore, it needs to be suitably amended inasmuch as the power to frame rules is to be vested in the High Court to be notified by the Government.
The judgment rendered in these petitions shall not affect the trials already concluded and convictions recorded in the Act as amended through Ordinances IV and XIII of 1999 and pending trials may continue subject to the above.
We would also like to record our appreciation of Mr. M. Akram Sheikh, learned Senior Advocate Supreme Court who skilfully argued the case, as well as for the precise, clear and candid submissions made by Mr. Aziz A. Munshi, learned Attorney‑General for Pakistan assisted by Mr. Tanvir Bashir Ansari, learned Deputy Attorney‑General.
(Sd.)
IRSHAD HASAN KHAN, J.
I agree with the judgment subject to my note separately recorded.
(Sd.)
SAIDUZZAMAN SIDDIQUI, C.J.
??????????? (Sd.)
IRSHAD HASAN KHAN, J.
I agree with the main judgment and also with the note of Hon'ble Chief Justice.
(Sd.)
NASIR ASLAM ZAHID, J.
(Sd.)
MUHAMMAD BASHIR JEHANGIRI, J.
I respectfully agree with the main judgment and also with the note added by the Honourable Chief Justice.
(Sd.)
RAJA AFRASIAB KHAN, J.
SAIDUZZAMAN SIDDIQUI, C.J.‑‑‑I have gone through the judgment proposed to be delivered by my learned brother, Irshad Hasan Khan, J. in the above cases. I agree with the judgment subject to the following note.
This Court in Mehram Ali v. Federation of Pakistan (PLD 1998 SC 1445) while declaring various sections of Anti‑Terrorism Act, 1997 (No.XXVII of 1997), hereinafter to be referred as 'the Act', as ultra vires suggested measures for appropriate amendments therein as follows:‑‑
(i)???????? Section 5 (2) (i) is held to be invalid to the extent it authorises the officer of Police, armed forces and civil armed forces charged with the duty of preventing terrorism, to open fire or order for opening of fire against person who in his opinion in all probability is likely to commit a terrorist act or any scheduled offence,, without being fired upon;???????????
(ii)??????? section 10 of the Anti‑Terrorism Act, 1997, hereinafter referred to as the Act, in its present form is not valid; the same requires to be suitably amended as to provide that before entering upon premises which is suspected to have material or a recording in contravention of section 8 of the Act, the concerned officer of Police, armed forces or civil armed forces shall record in writing his reasons for such belief and serve on the person or premises concerned a copy of such reasons before conducting such search;
(iii)?????? section 19 (10) (b) of the Act, which provides for trial of an accused in absentia on account of his misbehaviour in the Court, is violative of Article 10 of the Constitution and, therefore, is declared as invalid;
(iv)?????? sections 24, 25, 27, 28, 30 and 37 of the Act are also not valid in their present form as they militate against the concept of independence of judiciary and Articles 175 and 203 of the Constitution. They need to be amended as to vest the appellate power in a High Court instead of Appellate Tribunal and to use the words "High Court" in place of "Appellate Tribunal";
(v)??????? section 26 of the Act is not valid in its present form as it makes admissible the confession recorded by a police officer not below the rank of a Deputy Superintendent of Police as it is violative of Articles 13(b) and 25 of the Constitution and that the same requires to be suitably amended by substituting the words by a police officer not below the rank of a Deputy Superintendent of Police' by the words 'Judicial Magistrate';
(vi)?????? that the offences mentioned in the Schedule should have nexus with the objects mentioned in sections 6,7 and 8 of the Act;
(vii) section 35 of the Act in its present form is not valid as it militates against the concept of the independence of judiciary and is also violative of Articles 175 and 203 of the Constitution and, therefore, it needs to be suitably amended inasmuch as the power to frame rules is to be vested in the High Court to be notified by the Government;
(viii) section 14 of the Act requires to be amended as to provide security of the tenure of the Judges of the Special Courts in consonance with the concept of independence of judiciary. "
To give effect to the judgment of this Court in Mehram Ali's case, the President on 24th October. 1998 promulgated Anti‑Terrorism (Amendment) Ordinance (IX of 1998) which amended sections 2, 5, 6, 7, 10, 14, 16, 19, 25, 27, 28, 30 and 35, omitted sections 24 and 26 and substituted new section 37 m place of the old one, in the Act. On the expiry of Ordinance IX of 1998, the President re‑promulgated Anti‑Terrorism (Amendment) Ordinance, 1999 (1V of 1999), hereinafter to be called as Ordinance IV of 1999, on 27‑4‑1999 which besides repeating all the amendments introduced by Ordinance IX of 1998 (except the amendment A made in section 35) in the Act, inserted new sections 7‑A, 7‑B, 39‑A in the A Act and also added a new Entry No. 5 after Entry No. 4 in the Schedule to the Act. The petitioners challenged the above amendments introduced in the Act through Ordinance IV of 1999 in the above petitions on the grounds that the amendments made in the Act were not in accordance with the directions given by this Court in Mehram Ali's case. During pendency of the above petitions, Ordinance IV of 1999 was repealed by Anti‑Terrorism (Second Amendment) Ordinance, 1999 (Ordinance No.XIII of 1999) (hereinafter to be called as 'Ordinance XIII of 1999). Ordinance XIII of 1999 besides, repeating the amendments made in the Act introduced by Ordinance IV of 1999, further amended sections 7‑A, 7‑B, 13, 14 and 39‑A of the Act. The petitioners, therefore, also challenged the amendments made in the Act through Ordinance XIII of 1999.
I have examined the amendments made in various sections of the Act through Ordinance XIII of 1999 in the light of the observations in Mehram Ali's case and am of the view that except the amendment made in section 5(2)(i), omission to amend Section 35 and the validity of section‑7‑A, which will be dealt with separately, the rest of the amendments made in the Act, appear to be iii accord with the observations of this Court in Mehram Ali's case. In so fir the amendments made in Section 5 (2) (i), validity of the newly‑added section 7‑A and the effect of omission to amend section 35 of the Act, the same is examined as follows:‑‑
Section‑5, as it originally stood in the Act, reads as under:‑‑
"5. Use of armed forces and civil armed forces to prevent terrorism.‑‑‑
(1) Any police officer, or member of the armed forces, or civil armed forces, who is present or deployed in any area may, after giving sufficient warning, use the necessary force to prevent the commission of terrorist acts or scheduled offences, and, in so doing shall, in the case of an officer of the armed forces or civil armed forces, exercise all the powers of a police officer under the Code.
(2)??????? In particular and without prejudice to the generality of the provision of subsection (1), an officer of the police, armed forces and civil armed forces may‑‑
(i)???????? after giving prior warning use such force as may be deemed necessary or appropriate, bearing in mind all the facts and circumstances of the situation, against any person who is committing, or in all probability is likely to commit a terrorist act of a scheduled offence, and it shall be lawful for any such officer, or any superior officer, to fire, or order the firing upon any person or persons against whom he is authorised to use force in terms hereof;
(ii)??????? arrest, without warrant, any person who has committed an act of terrorism or a scheduled offence or against whom a reasonable suspicion exists that he has committed, or is about to commit, any such act or offence; and
(iii)?????? enter and search, without warrant, any premises to make‑any arrest or to take possession of any property, fire‑arm, weapon or article used, or likely to be used, in the commission of any terrorist act or scheduled offence.
(3)??????? Nothing contained in subsection (1) or (2) shall affect the provisions of Chapter IX of the Code and the provisions of section 132‑of the Code shall apply to any person acting under this section. "
This Court in Mehram Ali's case examined the validity of this ? section and struck it down for the following reason:‑‑
"(i)??????? It may be stated that subsection (1) of section 5 of the Act provides that any police officer, or member of the armed forces, or civil armed forces, who is present or deployed in any area may, after giving sufficient warning, use the necessary force to prevent the commission of terrorist acts or scheduled offences, and, in so doing shall, in the case of an officer of the armed forces or civil armed forces, exercise all the powers of a police officer under the Code. There is nothing wrong with the above provision. However, clause (i) of subsection (2) thereof empowers a police officer or member of the above forces after giving prior warning to use such force as may be deemed necessary or appropriate, bearing in mind all the facts and circumstances of the situation, against any person, who is committing, or in all probability is likely to commit a terrorist act or a scheduled offence. It also provides that it shall be lawful for any such officer, or any superior officer to use force, or to order the firing upon any person or persons against whom he is authorised to use force in terms thereof. The above provision is violative of Article 9 of the Constitution which guarantees that no person shall be deprived of life or liberty save in accordance with law. The conferment of power on the officers referred to in clause (i) of subsection (2) of section 5 without being fired upon by the accused is not justifiable. An officer of any of the above forces under the present provision can kill any person, if he considers that in all probability the former is likely to commit a terrorist act or scheduled offence The formation of opinion as to the probability or likelihood of commission of offence will vary from person to person as it depends on subjective satisfaction. There is no check or guideline provided for the exercise of the above power conferred by the above provision. We are, therefore, of the view that the aforesaid provision in its present form is not sustainable. The same may be amended and it may be provided that the officer can fire upon an accused person if he has been himself fired upon by him. "
The Government while amending section 5 ibid, only omitted the words "or in all probability is likely to commit" in clause (i) of subsection (2) of section 5 ibid. The contention of Mr. Akram Shaikh, the learned counsel for the petitioners in the above petitions is that the above amendment made in section 5(2)(i) of the Act is not in line with the direction of this Court in Mehram Ali's case.
Mr. Tanvir Bashir Ansari, the learned Deputy Attorney‑General, on the other hand, contended that omission of words "or in all probability is likely to commit" from section 5(2)(i) of the Act sufficiently complied the direction of this Court in Mehram Ali's case with regard to section 5 of the Act. The learned Deputy Attorney‑General, in support of his contention, specifically referred to the observations of this Court at placitum 'Q' in the judgment in this regard, which I have already reproduced above. The contention of the learned Deputy Attorney‑General does not appear to be correct. Section 5 (2)(i) as amended authorises the police officer or the member of the armed forces or the civil armed forces, deployed in connection with the prevention of terrorism to fire or order firing upon any person who is committing a terrorist act or a scheduled offence. The list of offences triable under the Act is given in the Schedule to the Act. There are many offences listed in the Schedule for which punishment prescribed under the relevant law is ten years or less. Therefore, if a person is tried for such scheduled offences before an A.T.A. Court and convicted, he would be liable to punishment which may extend to ten years or less. However, under section 5(2)(i), the police officer or the armed forces or civil armed forces may open fire on such offender, without being fired upon, if he is found committing the offence, thus, causing his death. Such a provision is clearly violative of the terms of Article 9 of the Constitution. The learned Attorney?-General, who subsequently appeared in the above cases also, candidly conceded that section 5(2)(i) is to be amended keeping in view the underlined observations of this Court reproduced above. I, therefore, hold that amendment made in section 5(2)(i) is not in accordance with the direction of this Court in Mehram Ali's case. This section, therefore, requires to be suitably amended in the light of the above observations:‑‑
Section 35 of the Act in its original form was as follows:‑‑
"35. Power to make rules The Government may, by notification, make such rules, if any, as it may deem necessary for carrying out the purposes of this Act."
The above section was held invalid for the following reasons:‑‑
"(vii) It may be mentioned that section 35 of the Act empowers the Government to frame rules through a notification, which it may deem necessary for carrying out the purposes of the Act. Since we have already held that under sections 24, 25, 27, 28, 30 and 37 of the Act High Court should be substituted in place of 'Appellate Tribunal' and as the Special Courts are to operate/function under the control and, supervision of the High Court concerned in terms of Article 20 of the Constitution, the power to frame rules should vest in the High Court and not in the Government. We therefore, hold that section 35 of the Act in its present form is not valid as it militates against the concept of independence of judiciary and is also violative of Articles 175 and 203 of the Constitution and, therefore, it needs to be suitably amended in the right of the above findings. "
Through Ordinance IX of 1998, section 35 of the Act was amended as follows:‑‑
"Power to make rules.‑‑‑‑(1) A High Court may make such rules, if any, as it may deem necessary for carrying out the purposes of this Act.
(2)??????? The rules made under subsection (1) shall be notified by the Government in the official Gazette."
The above amendment made in section 35 ibid, was in line with the observation of this Court in Mehram Ali's case. However, the above amendment was omitted while promulgating Ordinances IV and XII of 1999. C The learned .Deputy Attorney‑General conceded that the amendment made in G section 35 ibid, through Ordinance IX of 1998 should have been repeated in Ordinance IV of 1999 and Ordinance XIII of 1999. I, therefore, direct that section 35 ibid, be amended suitably in line with the observations reproduced above.
The learned counsel for the petitioners besides contending that the above amendments made in the Act through Ordinance IV of 1999, Ordinance XIII of 1999 are not in accordance with the judgment of this Court in Mehram Ali's case very vehemently argued that section 7‑A inserted in the Act is violative of Articles 2A, 4, 9, 16, 17, 19 and 25 of the Constitution. It is contended by the learned counsel for the petitioners that the Legislature while defining "civil commotion" have used expressions like "internal disturbance, illegal strikes, go-slows, lock‑outs which are vague and ambiguous and are capable of being misinterpreted and misused by the authorities to deprive the people of their fundamental rights guaranteed under the Constitution. It is contended that while creating new offences, the definition should be precise and intelligible so that the person could understand clearly what acts if committed will fall within the definition of the offence. The determination of such' offence could not be left on the interpretation of the words used in the definition by the person charged with the enforcement of the Act.
The learned Deputy Attorney‑General, on the other hand, contended that illegal strike, go‑slow and lock‑outs are to be read ejusdem generis with the earlier expression used in the section "internal disturbance". According to learned Deputy Attorney‑General if the illegal strike, go‑slows and lock‑outs result in the internal disturbances then alone it would be treated as "civil commotion" as defined in section 7‑A.
After considering the arguments of the learned counsel for the parties, I am of the view that to the extent section 7‑A makes internal disturbance, illegal strikes, go‑slows and lock‑outs punishable as an act of terrorism, the same cannot be upheld.
The Act was promulgated with the object of prevention of terrorism, sectarian violence and for speedy trial of heinous offences and for matters connected therewith and incidental thereto as is evident from its preamble. "Terrorist act" was defined in section 6 as follows:‑‑
"6. Terrorist Act, ‑‑‑‑Whoever, to strike terror in the people, or any section of the people, or to alienate any section of the people or to adversely affect harmony among different sections of the people, does not act or thing by using bombs, dynamite or other explosive or inflammable substances, or fire‑arms, or other lethal weapons or poisons or noxious gases or chemicals or other substances of a hazardous nature in such a manner as to cause, or to be likely to cause the death of, or injury to, any person or persons, or damage to, or destruction of, property or disruption of any supplies or services essential to the life of the community or displays fire‑arms. or threatens with the use of force public servants in order to prevent them from discharging their lawful duties commits a terrorist act.?
The above definition of 'terrorist act'' was amended from time to time and the latest amended definition of a 'terrorist act' is given in Ordinance XIII of 1999 as under:‑‑
"6.??????? Terrorist Act.‑‑‑A person is said to commit a terrorist act if he‑‑
(a)??????? in order to, or if the effect of his actions will be to, strike terror or create a sense of fear and insecurity in the people, or any section of the people, does any act or thing by using bombs, dynamite or other explosive or inflammable substances, or such fire‑arms or other lethal weapons as may he notified, or poisons or noxious gases or chemicals, in such a manner as to cause, or be likely to cause, the death of, or injury to, any person or persons, or damage to, or destruction of, property on a large scale, or a widespread disruption of supplies of services essential to the life of the community, or threatens with the use of force public servants in order to prevent them from discharging their lawful duties; or
(b)??????? commits a scheduled offence, the effect of which will be, or be likely to be, to strike terror, or create a sense of fear and insecurity in the people, or any section of the people or to adversely affect harmony among different sections of the people; or
(c)??????? commits an act of gang rape, child molestation, or robbery coupled with rape as specified in the Schedule to this Act; or
(d)??????? commits an act of civil commotion as specified in section 7‑A. "
I am, therefore, of the view that to make an act punishable under the Act, it must be shown that the act bears nexus to sections 6, 7 and 8 of the? Act.
In Mehram Ali's case this Court while examining the scope of the power of the Government under section 34 of the Act to amend the Schedule to the Act by adding or deleting the entries therein observed as follows:‑‑
"(vi) It may be observed that the learned counsel for the petitioners urged with vehemence that the power given under section 34 of the Act to the Government to amend the Schedule to the Act so as to add any entry thereto or modify or omit any entry therein by a notification is ultra vires the Constitution. It has been further urged by them that the above power has been abused inasmuch as many offences have been included which have no nexus with the object of the Act or with the offences covered by sections 6, 7 and 8 thereof. In this regard, it may be pertinent to mention that delegation of such power to the Government by the Legislature is not an unusual phenomenon. In order to implement the object of a statute or to work out certain detail, such power is normally delegated. In this regard, reference may be made to the case of Zaibtun Textile Mills Ltd. v. Central Board of Revenue and others (PLD 1983 SC 358). In the above case, the Legislature had conferred power on the Central Board of Revenue to formulate guidelines to determine rate of production, capacity tax and even to levy tax under section 3, 4, 5, 6 and 7 of the Central Excises and Salt Act, 1944, as amended by the Finance Act, 1966. The above provision was assailed but this Court held that the Legislature was competent to employ proper agency to accomplish its legislative purpose. Reference may also be made to the case of Muhammad Hussain Ghulam Muhammad and another v. The State of Bombay and another Ishwarbhai Becharibhai and others Interveners (AIR 1962 SC 97), in which also such delegation was upheld by the Indian Supreme Court.
However, it may be observed that the offences mentioned in the Schedule should have nexus with the object of the Act and the offences covered by sections 6, 7 and 8 thereof. It may be stated that section 6 defines terrorist acts, section 7 provides punishment for such acts, and section 8 prohibits acts intended or likely to stir up sectarian hatred mentioned in clauses (a) to (d) thereof. If an offence included in the Schedule has no nexus with the above sections, in that event notification including such an offence to that extent will be ultra vires."
The Legislature while making 'civil commotion' punishable under section 7‑B of the Act defined it in section 7‑A as follows:‑‑
7‑A. Creation of civil commotion.‑‑‑‑'Civil commotion' means creation of internal disturbances in violation of law, commencement or continuation of illegal strikes, go‑slows, lock‑outs, vehicles snatching or lifting, damage to or destruction of State or private property, random firing to create panic, charging Bhatha, acts of criminal trespass (illegal Qabza). "
A careful reading of the above definition would show that besides I making 'creation of internal disturbances in violation of law, commencement or continuation of illegal strikes, go‑slows, and lock‑outs, vehicle snatching F or lifting, damage to or destruction of State or private property, random firing to create panic, charging Bhatha, and acts of criminal trespass (illegal Qabza) have also been made punishable under section 7‑B of the Act as terrorist acts. The learned counsel for the petitioners has, however, only objected to the inclusion of internal disturbance in violation of law, commencement or continuation of illegal strikes, go‑slows and lock‑outs, as terrorist acts punishable under the Act.
The expression 'internal disturbance' used in section 7‑A ibid, has not been defined. It is not known what acts would fall within the meaning of internal disturbances to make it punishable under the Act. In my view, the expression 'internal disturbances' simpliciter is vague and bears no nexus to the terrorist act unless it is elucidated further. The 'internal disturbance' may produce variety of consequences. For illustration, I may refer to G Article 232(1) of the Constitution which authorises the President to proclaim emergency if he is satisfied amongst other that the security of Pakistan or any part thereof is threatened by internal disturbance beyond the Power of a Provincial Government to control it. Therefore, the magnitude of the internal disturbances would be a determining factor for the proposed action. I am, therefore, of the view that internal disturbance in violation of law' simpliciter does not bear nexus to the object of the Act and as such its punishment in its present form under the Act, is not sustainable under the Act.
I now turn to the other part of the arguments of the petitioners that commencement or continuation of the illegal strikes, lock‑outs and go‑slows could not be punished under the Act as terrorist acts. The meaning of the words strike, illegal strike, lock‑outs, illegal lock‑outs and illegal go‑slow were already known to the Legislature when it enacted the Act as these expressions were in vogue in connection with labour laws.
Strike, lock‑out, illegal strikes and illegal lock‑out are defined IH respectively in clauses (xxv), (xvi), (xii) and (xi) of section 2 of the Industrial Relations Ordinance, 1969 (I.R.O.), as follows:‑‑
"(xxv) 'Strike' means cessation of work by a body of persons employed in any establishment acting in combination or a concerted refusal or refusal under a common understanding of any number of persons who are or have been so employed to continue to work or to accept employment;
"(xvi) 'Lock‑out' means the closing of a place of employment or part of such place or the suspension, wholly or partly, of work by an employer, or refusal, absolute or conditional, by an employer to continue to employ any number of workmen employed by him where such closing, suspension or refusal occurs in connection with an industrial dispute or is intended for the purpose of compelling workmen employed to accept certain terms and 'conditions of or affecting employment;
"(xii) 'Illegal strike' means a strike declared, commenced or continued otherwise than in accordance with the provisions of this Ordinance;"
"(xi) 'Illegal lock‑out' means a lock‑out declared, commenced or continued otherwise than in accordance with the provisions of this Ordinance;"
Right to serve notice of strike by workers and lock‑out by the employer is given in section.26 of the I.R.O. as follows:‑‑
"26. Negotiations relating to differences and disputes ‑‑‑‑(1) If at any time an employer or a collective bargaining agent finds that an industrial dispute has arisen or is likely to arise, the employer or, as the case may be, the collective bargaining agent, may communicate his or its views in writing either to the Works Council or to the other party so, however, that, where the views are so communicated to the Works Council, a copy of the communication shall also be sent to the other party.
(2)??????? On receipt of the communication under subsection (1), the Works Council or the party receiving it shall try to settle the dispute by bilateral negotiations within ten days of the receipt of the communication or within such further period as may be agreed upon by the parties and, if the parties reach a settlement, a memorandum of settlement shall be recorded in writing and signed by both the parties and a copy thereof shall be forwarded to the Conciliator and the authorities mentioned in clause (xxiv) of section 2.
(3)??????? Where a settlement is not reached between the employer and the collective bargaining agent or, if the views of the employer or collective bargaining agent have been communicated under subsection (1) to the Works Council, there is a failure of bilateral negotiations in the Work Council, the employer or the collective bargaining agent may, within seven days from the end of the period referred to in subsection (2), serve on the other party to the dispute a notice of lock‑out or strike, as the case may be, in accordance with the provisions of this Ordinance. "
The period of notice of strike or lock‑out is prescribed as fourteen days in section 28 of I.R.O.
Section 32 of I.R.O. deals with the right of workers to go on strike and that of employer to declare lock‑out as follows:‑‑
"32.????? 'Strike and lock‑out'.‑‑‑‑(1) If no settlement is arrived at during the course of conciliation proceedings and the parties to the dispute do not agree to refer it to an arbitrator under section 31, the workmen may go on strike or, as the case may be, the employer may declare a lock‑out on the expiry of the period of the notice under section 28 or upon a declaration by the Conciliator that conciliation proceedings have failed, whichever is the latter.
(1‑a) The party raising a dispute may at any time, either before or after the commencement of a strike or lock‑out, make an application to the Labour Court for adjudication of the dispute.
(2)??????? Where a strike or lock‑out lasts for more than thirty days the Federal Government, if it relates to a dispute which the Commission is competent to adjudicate and determine, and the Provincial Government, if it relates to any other dispute, may, by order in writing prohibit the strike or lock‑out:
Provided that the Federal Government may, with respect of a strike or lock‑out relating to a dispute which the Commission is competent to adjudicate and determine and the Provincial Government, with the previous approval of the Federal Government may, with respect to any other strike or lock‑out, by order in writing, prohibit a strike or lock‑out at any time before the expiry of thirty days, if it is satisfied that the continuance of such a strike or lock‑out is causing serious hardship to community or is prejudicial to the national interest.
(3)??????? In any case in which the Federal Government or the Provincial Government prohibits a strike or lock‑out, it shall forthwith refer the dispute to the Commission or, as the case may be, the Labour Court.
(4)??????? The Commission, or as the case may be, the Labour Court shall, after giving both the parties to the dispute an opportunity of being heard, make such award as it deems fit as expeditiously as possible but not exceeding thirty days from the date on which the dispute was referred to it:
Provided that the Commission, or as the case may be, the Labour Court may also make an interim award on any matter of dispute:
Provided also that any delay by the Commission, or as the case may be, the Labour Court in making an award shall not affect validity of any award made by it.
(5)??????? An award of the Commission or, as the case may be, the Labour Court shall be for such period, as may be specified in the award, which shall not be more than two years.
Section 46 of I.R.O. sets out the circumstances which would render a strike or a lock‑out illegal as under:‑‑ ?????
"46. Illegal strikes and lock‑outs.‑‑‑‑(1) A strike or lock‑out shall be illegal if‑‑
(a)??????? it is declared, commenced or continued without giving to the other party to the dispute, in the prescribed manner, a notice of strike or lock‑out or before the date of strike or lock‑out specified in such notice, or in contravention of section 44; or
(b)??????? it is declared, commenced or continued in consequence of an industrial dispute raised in a manner other than that provided in section 43; or
(c)??????? it is continued in contravention of an order made under section 32, section 33, section 45 or subsection (3) of section 46‑A;
(d)??????? it is declared, commenced or continued during the period in which a settlement or award in operation in respect of any of the matters covered by a settlement or award.
(2)??????? A lock‑out declared in consequence of an illegal strike and a strike declared in consequence of an illegal lock‑out shall not be deemed to be illegal."
Section 46‑A of the I.R.O. described the procedure for dealing with illegal strikes or lock‑outs as follows:‑‑ ????
"46‑A. Procedure in case of illegal strikes or lock‑outs.‑‑=‑(1) Notwithstanding anything contained in any other provision of this Ordinance or in any other law for the time being in force, an Officer of the Labour Department not below the rank of Assistant Director, Labour Welfare, hereinafter in this section referred to as the Officer, may make enquiries in such manner as he may deem fit into an illegal strike or illegal lock‑out in a factory and make a report to the Labour Court.
(2)??????? After completing the enquiry the officer shall serve a notice on the employer and the collective bargaining agent or the registered trade union with the dispute to appear before the Labour Court on a date to be fixed by that Court.
(3)??????? The Labour Court may, within ten days following the day on which it receives a report under subsection (1), after considering the report and hearing such of the parties as appear before it order the strike to be called off or the lock‑out to be lifted.
(4)??????? if the employer contravenes the order of the Labour Court under subsection (3) and the Court is satisfied that the continuance of the lock‑out is causing serious hardship to the community or is prejudicial to the national interest, it may issue an order for the attachment of the factory and for the appointment of an official receiver for such period as . it deems fit, and such period may be varied from time to time.
(5)??????? The official receiver shall exercise the powers of management and may transact business, enter into contracts, give valid discharge of all money received and do or omit to do all such acts as are necessary for conducting the business of the factory.
(6)??????? The Labour Court may, in appointing and regulating the work of an official receiver exercise the power of a Civil Court under the Code of Civil Procedure (Act V of 1908).
(7)??????? If the workers contravene the order of the Labour Court under subsection (3), the Court may pass orders of dismissal against all or any of the striking workers and, notwithstanding anything contained in this Ordinance, if the Court, after holding such inquiry as it deems fit, records its finding that any registered trade union has committed or abetted the commission of such contravention, the finding shall have the effect of cancellation of the registration of such trade union and debarring all officers of such trade union from holding office in that or in any other trade union for the unexpired terms of their offices and for the terms immediately following:
Provided that the Court may review its order if good and sufficient cause is shown by an affected worker within seven days of such orders of dismissal.
(8)??????? Subject to any rule made by the Provincial Government in this behalf, the Officer may, for the purpose of enquiry under subsection (1), within the local limits for which he is appointed, enter with such assistants, if any, being persons in the service of Pakistan, as he thinks fit, in a factory where he has reason to believe an illegal strike or lock‑out to be in progress, and make such examination of the premises and plant and of any register maintained therein and take on the spot or otherwise such evidence of persons and exercise such other powers as he may deem necessary for carrying out the purposes of this section.
(9)??????? The Officer shall have authority to call any party to such dispute to his office or secure his presence in the factory and shall also have the power to bind any party to the dispute to appear before the Labour Court.
(10) Where a party to an illegal .strike or lock‑out, on being required or bound under this section to appear before the officer or the Labour Court does not so appear, the Officer or Labour Court, as the case may be, besides taking such other action as may be admissible under this Ordinance, proceed ex parte."
Section 59 of the I.R.O. which provided for punishment for taking part in or instigating go‑slow, was omitted by Act No.XVI of 1975, dated M 10‑12‑1975, reads as follows:‑‑
"59. Whoever takes part in, or instigates or incites others to take part in, or otherwise acts in furtherance of, a go‑slow shall be punishable with imprisonment for' a term which may extend to six months, or with fine which may extend to five hundred rupees, or with both:
Explanation.‑‑‑‑In this section, 'go‑slow' means an organised, deliberate and purposeful slowing down of normal output of work by a body of workmen acting in a concerted manner, but does not include the slowing down of normal output of work which is due to mechanical defect, breakdown of machinery, failure or defect in power in supply or. in the supply of normal materials and spare parts of machinery."
From the above‑referred provisions of I.R.O., it is quite clear that right to go on strikes or to declare lock‑outs are the normal rights of the I workers and employers respectively which are regulated under I.R.O. Similarly, the procedure to deal with illegal strikes by workers and declaration of illegal lock‑outs by employers arc dealt with under section 46‑A of I.R.O. and disobedience of the order passed under section 46‑A are made punishable under section 56 of I.R.O. In the same manner, go‑slow which was punishable under section 59 of the I.R.O. is no more an offence after omission of section 59 of the I.R.O. In these circumstances, it is difficult to agree with the contention of the learned Deputy Attorney‑General that continuation of illegal strikes, lock‑outs and go‑slows amounts to terrorism or a terrorist act, which could be punished under the Act. Illegal strikes, lock‑outs and go‑slows as defined under I.R.O. in my view, bear no nexus with terrorism or terrorist act and as such, the same could not be made punishable under the Act. In the absence of the definition if illegal strike, illegal lock‑outs or illegal go‑slows which establish nexus of these acts with terrorism or a terrorist act, as defined in the Act, the same could not be made punishable under the Act.
(Sd.)
SAIDUZZAMAN SIDDIQUI, C.J.
M.B.A./J‑34/S???????????????????????????????????????????????????????????????????????????????????????????????????????????? Order accordingly.
P L D 2000 Supreme Court 179
Present: Saiduzzaman Siddiqui, C.J., Irshad Hasan Khan, Raja Afrasiab Khan, Muhammad Bashir Jehangiri and Nasir Aslam Zahid, JJ
Mr. Justice GHULAM HYDER LAKHO, HIGH COURT
OF SINDH, KARACHI and odors‑‑‑Petitioners
versus
FEDERATION OF PAKISTAN through Secretary Law, Justice and Parliamentary Affairs, Islamabad and others‑‑‑Respondents
Constitutional Petitions Nos. 43, 44, 47, 49, 50 of 1996, 59 of 1997 and 7, 24, 25, 39 and 44 of 1998, decided on 1st December, 1999.
(Under Article 184(3) of the Constitution of Islamic Republic of Pakistan, 1973).
(a) Judgment‑‑
‑‑‑‑Short order‑‑‑Nature‑‑‑Short order in a case is the summary of the findings of the Court while detailed reasons are elaboration of that summary‑‑‑Unless there is any conflict between the short order and the detailed reasons, both are to be read together to understand the real import and scope of the judgment.
(b) Constitution of Pakistan (1973)‑
‑‑‑‑Art. 193‑‑‑Appointment of High Court Judges‑‑Effect of Supreme Court Judgment in Al‑Jehad Trust v. Federation of Pakistan PLD 1996 SC 324‑‑Appointment/confirmation of the Judge of the High Court made by the Government in consultation with the Acting Chief Justice has been declared to be invalid in AI‑Jehad Trust case PLD 1996 SC 324 by Supreme Court on the ground that same was violative of the mandatory provision of the Constitution, it was held that such invalidity in the process of consultation in making the appointment/confirmation of the Judges, was to be removed by a fresh processing of the case by the permanent Chief Justice keeping in view the provisions of Art.193 of the Constitution‑‑the Chief Justice of the High Court and the Chief Justice of Pakistan in that process were of the opinion that any of the incumbents was not fit for appointment _ or confirmation or lacked the qualification prescribed in Art.193 of the Constitution for appointment as a Judge of the High Court, they were entitled to express their opinion accordingly within the scope of Supreme Court judgment in AI‑Jehad Trust case PLD 1996 SC 324.
(c) Constitution of Pakistan (1973)‑‑‑
‑‑‑‑Art. 193‑‑‑Appointment of High Court Judge‑‑‑Procedure‑‑‑Additional Judge ceases to hold the office if the period specified in the notification appointing him as an Additional Judge is not extended and in such an eventuality, he cannot claim hearing before expiry of the period mentioned in the notification ‑‑‑Additional Judge appointed in the High Court against permanent vacancy or if permanent vacancy occurs while such Judge is performing function as Additional Judge, he acquires a legitimate expectancy and he is entitled to be considered for permanent appointment on expiry of his period as Additional Judge if he is recommended by the. Chief Justice of the High Court concerned and the Chief Justice of Pakistan‑‑‑Where the Chief Justice of the High Court concerned and the Chief Justice of Pakistan do not recommend a particular incumbent for confirmation or appointment as a Judge of the High Court and these recommendations are accepted by the President/Executive, the same cannot be brought under challenge in the Court on the ground that the incumbent was not heard before making such recommendation‑‑‑Recommendations of the Chief Justice of the High Court concerned and Chief Justice of Pakistan, therefore, are not justiciable.
The appointment of an additional judge of the High Court is for a specified period. Such appointment, therefore, comes to an end on expiry of the period mentioned in the notification appointing the additional judge of the High Court, unless the period is further extended or the appointment is converted into a Judge of the High Court. Therefore an Additional Judge ceases to hold the office if the period specified in the notification appointing him as an Additional Judge is not extended. In such an eventuality, he cannot claim hearing before expiry of the period mentioned in the notification. However, additional judges appointed in the High Court against permanent vacancies or if permanent vacancies occur while such judges are performing functions as additional judges, they acquire a legitimate expectancy and they are entitled to be considered for permanent appointment on expiry of their period as additional judges if they are recommended by the Chief Justice of the High Court concerned and the Chief Justice of Pakistan.
In any case, it is a matter for consideration by the Chief Justice of the High Court concerned and the Chief Justice of Pakistan. They have to decide, whether a particular candidate has requisite experience and once they form the view that the candidate has the requisite experience as envisaged by sub‑clause (a) of clause (2) of Article 193, this issue will not be justiciable before the Court of law. The Court cannot sit and decide, whether a particular person has the requisite experience or not? It is a matter of subjective satisfaction of the Chief Justice of the High Court concerned and the Chief Justice of Pakistan.
Where the Chief Justice of the High Court concerned and the Chief Justice of Pakistan do not recommend a particular incumbent for confirmation or appointment as a Judge of the High Court and these recommendations arc accepted by the President/Executive, the same cannot be brought under challenge in the Court on the ground that the incumbent was not heard before making such recommendations.
The recommendations of the Chief Justice of the High Court and that of Chief Justice of Pakistan are not justiciable.
Al‑Jehad Trust v. Federation of Pakistan PLD 1996 SC 324 ref.
(d) Constitution of Pakistan (1973)‑‑‑
‑‑‑‑Arts. 193 & 209‑‑‑Appointment of High Court Judge‑‑‑Recommendations of the Chief Justice of the High Court concerned and that of Chief Justice of Pakistan in respect of fitness or otherwise of a person to be appointed/confirmed as a Judge of the High Court, would not fall within the scope of Art.209 of the Constitution ‑‑‑Contention that a Judge once appointed in the High Court could not be removed, except in accordance with provisions of Art.209 of the Constitution was repelled.
Asad Ali v. Federation of Pakistan PLD 1998 SC 161 ref.
(e) Constitution of Pakistan (1973)‑‑‑
‑‑‑‑Art. 209‑‑‑Scope of Art.209 of tile Constitution.
Asad Ali v. Federation of Pakistan PLD 1998 SC 161 quoted.'
(f) Constitution of Pakistan (1973)‑‑‑
‑‑‑‑Art. 193‑‑‑Appointment of High Court Judge‑‑‑Effect of Supreme Court judgment in Al‑Jehad Trust v. Federation of Pakistan PLD 1996 SC 324‑‑Appointment/confirmation of the Judge of the High Court made by the Government in consultation with the Acting Chief Justice having been declared to be invalid in Al‑Jehad Trust case PLD 1996 SC 324 by Supreme Court on the ground that same was violative of the mandatory provisions of the Constitution in the process of consultation in making the appointment/confirmation of the Judge, was to be removed by a fresh processing of the case by the permanent Chief Justice keeping in view the provisions of Art. 193 of the Constitution‑‑‑If the Chief Justice of the High Court and the Chief Justice of Pakistan in that process were of the opinion that any of the incumbents was not fit for appointment nor confirmation or lacked the qualification prescribed in Art.193 of the Constitution for appointment as a Judge of the High Court, they were entitled to express their opinion accordingly within the scope of Supreme Court judgment in Al‑Jehad Trust case PLD 1996 SC 324‑‑‑Additional Judge of the High Court was appointed on the recommendation of a permanent Chief Justice of High Court; his tenure as Additional Judge was extended for one year and on the recommendation of Acting Chief Justice of the High Court and the then Chief Justice of Pakistan and similarly confirmation of the Judge was also recommended by Acting Chief Justice of High Court‑‑‑Effect‑‑‑Confirmation of the Additional Judge having taken place on the recommendation of Acting Chief Justice, it was not a valid confirmation within the scope of Supreme Court judgment in Al‑Jehad Trust case‑‑‑Initial appointment of the Judge as Additional Judge, though did not suffer from any Constitutional infirmity, his confirmation fell within the mischief of judgment of Supreme Court in case of Al‑Jehad Trust v. Federation of Pakistan PLD 1996 SC 324 and accordingly, his case needed fresh processing and regularisation within the scope of direction in the said Supreme Court judgment‑‑‑Confirmation of Additional Judge having been rendered invalid by force of the Supreme Court judgment in Al‑Jehad Trust case, he shall be deemed to have not been confirmed as a Judge of High Court and shall be entitled to practice before that High Court.
(g) Constitution of Pakistan (1973)‑‑‑
‑‑‑‑Art. 193‑‑‑Appointment of High Court Judge‑‑‑Effect of Supreme Court judgment in Al‑Jehad Trust v. Federation of Pakistan PLD 1996 SC 324‑‑Appointment/confirmation of the Judge of the High Court made by the Government in consultation with the Acting Chief Justice having been declared to be invalid in Al‑Jehad Trust case PLD 1996 SC 324 by Supreme Court on the ground that same was violative of the mandatory provisions of the Constitution, it was held that such invalidity in the process of consultation in making the appointment/confirmation of the Judge, was to be removed by a fresh processing of the case by the permanent Chief Justice keeping in view the provisions of Art.193 of the Constitution‑‑‑If the Chief Justice of the High Court and the Chief Justice of Pakistan, in that process, were of the opinion that any of the incumbents was not fit for appointment or confirmation or lacked the qualification prescribed in Art. 193 of the Constitution for appointment as a Judge of the High Court, they were entitled to express their opinion accordingly within the scope of Supreme Court judgment in Al‑Jehad case PLD 1996 SC 324‑‑‑Judge of High Court having resigned from his office could not challenge his de‑notification as a Judge of the High Court but he could not be declined the rights of practice before the High Court concerned as his confirmation as Judge of the High Court was rendered invalid under the law declared by Supreme Court in Al Jehad Trust case.
(h) Constitution of Pakistan (1973)‑‑‑
‑‑‑‑Art. 193‑‑‑Appointment of High Court Judge‑‑‑Effect of Supreme Court judgment in Al‑Jehad Trust v. Federation of Pakistan PLD 1996 SC 324‑‑Appointment/confirmation of the Judge of the High Court made by the Government in consultation with the Acting Chief Justice having been declared to be invalid in Al‑Jehad Trust case PLD 1996 SC 324 by Supreme Court on the ground that same was violative of the mandatory provisions of the Constitution, it was held that such invalidity in the process of consultation in making the appointment/confirmation of the Judge, was to be removed by a fresh processing of the case by the permanent Chief Justice keeping in view the provisions of Art.193 of the Constitution‑‑‑If the Chief Justice of the High Court and the Chief Justice of Pakistan, in that process, were of the opinion that any of the incumbents was not fit for appointment or confirmation or lacked the qualification prescribed in Art. 193 of the Constitution for appointment as a Judge of the High Court, they were entitled to express their opinion accordingly within the scope of Supreme Court judgment in Al‑Jehad case PLD 1996 SC 324‑‑‑When the Judge was not recommended for retention/confirmation as a Judge of the High Court by the Chief Justice of concerned High Court or the Chief Justice of Pakistan during the process of regularisation and recommendation or non-recommendation being not justiciable, de‑notification of such a Judge was not open to any exception.
(i) Constitution of Pakistan (1973)‑‑‑
‑‑‑‑Art. 193‑‑‑Appointment of High Court Judge‑‑‑Effect of Supreme Court judgment in Al‑Jehad Trust v. Federation of Pakistan PLD 1996 SC 324‑‑Appointment/confirmation of the Judge of the High Court made by the Government in consultation with the .Acting Chief Justice having been declared to be invalid in Al‑Jehad Trust case PLD 1996 SC 324 by Supreme Court on the ground that same was violative of the mandatory provisions of the Constitution, it was held that such invalidity in the process of consultation in making the appointment/confirmation of the Judge, was to be removed by a fresh processing of the case by the permanent Chief Justice keeping in view the provisions of Art. 193 of the Constitution‑‑‑If the Chief Justice of the High Court and the Chief Justice of Pakistan, in that process, were of the opinion that any of the incumbents was not fit for appointment or confirmation or lacked the qualification prescribed in Art. 193 of the Constitution for appointment as a Judge of the High Court, they were entitled to express their opinion accordingly within the scope of Supreme Court judgment in Al‑Jehad case PLD 1996 SC 324‑‑‑Judge was not recommended for retention as a Judge of the High Court either by Chief Justice of the concerned High Court or by the Chief Justice of Pakistan during the process of regularisation and was informed that he did not possess 10 years' active practice and, therefore, he could not be confirmed and he was also given the option to resign from the office of the Judge of High Court which he declined‑‑‑Contention of the Judge was that ground of his removal from the office of the Judge of High Court that he did not possess the requisite 10 years' active practice, was the result of misreading of the date of his enrolment as 6‑2‑1989 which was actually 8‑2‑1979 which contention was found to be correct‑‑‑Judge, after de‑notification as a Judge of the High Court was once again recommended for appointment as an Additional Judge which he consented‑‑‑Held, Judge, in circumstances, could not challenge the de‑notification as Judge of the High Court and it' he was again recommended for that office in accordance with law de‑notification should not come in the way of his fresh appointment.
Per Raja Afrasiab Khan, J., Contra‑‑
Per Muhammad Bashir Jehangiri, J.; generally agreeing with Saiduzzaman Siddiqui, CJ.‑‑‑
Raja Abdul Ghafoor, Advocate‑on‑Record for Petitioner (in C.P. No.43 of 1996).
Shahzad Jehangir, Senior Advocate Supreme Court and Mahmood A. Qureshi, Advocate‑on‑Record (absent) for Petitioner (in C.P. No. 44 of 1996).
Malik Saeed Hassan, Senior Advocate Supreme Court and Raja M. Anwar, Senior Advocate Supreme Court and S.A. Aasim Jafri, Advocate‑on-Record (absent) (in C.P. No.47 of 1996).
Shehzad Jehangir, Senior Advocate Supreme Court and Mehr Khan Malik, Advocate‑on‑Record for Petitioner (in C.P. No.49 of 1996).
Ch. Mushtaq Ahmad Khan, Senior Advocate Supreme Court and Mehr Khan Malik, Advocate‑on‑Record for Petitioner (in C.P. No.50 of 1996).
Malik Saeed Hassan, Senior Advocate Supreme Court, Raja M. Anwar, Senior Advocate Supreme Court and S.A. Aasim Jafri, Advocate‑onRecord (abseno (in C.P. No.59 of 1997).
Qazi M. Jamil, Senior Advocate Supreme Court for Petitioner (in C.P. No.7 of 1998).
Ch. Mushtaq Ahmad Khan, Senior Advocate Supreme Court and Mehr Khan Malik, Advocate‑on‑Record for Petitioner (in C.P.‑ No.24 of 1998).
Munir Peracha, Advocate Supreme Court and Ejaz M. Khan, Advocate‑on‑Record for Petitioner (in C.P. No.25 of 1998).
Aitezaz Ahsan, Advocate Supreme Court and M. S. Khattak, Advocate‑on‑Record for Petitioner (in C.P. No.39 of 1998).
Ch. Mushtaq Ahmad Khan, Senior Advocate Supreme Court and Mehr Khan Malik, Advocate‑on‑Record for Petitioner (in C.P. No.44 of 1998).
Tanvir Bashir Ansari, Deputy Attorney‑General for Pakistan for Respondents (in all Cases).
Dates of hearing: 8th, 10th, 11th and 12th, November, 1999.
JUDGMENT
SAIDUZZAMAN SIDDIQUI, C. J.‑‑‑The abovementioned Constitutional petitions under Article 184(3) of the Constitution of Islamic Republic of Pakistan (hereinafter to be referred as "the Constitution") have been filed by eleven former Judges of High Courts of Lahore, Peshawar and Karachi, to challenge their removal from their respective offices as Judges of the High Courts in implementation of judgment of this Court in Al‑Jehad Trust v. Federation of Pakistan PLD 1996 SC 324 (hereinafter to be referred as 'the Judges' case).
"For reasons to be recorded later, we pass the following short order.
In these two cases some appointments of Judges in the Superior Judiciary are challenged and called. in question on the ground that they have been made in contravention of the procedure and guidelines laid down in the Constitution, and in this context we are called upon to examine in detail the relevant articles pertaining to the Judiciary specified in Part VII of the Constitution to render an authoritative decision on the question of interpretation of such Articles in the light of other co‑related Articles.
Pakistan is governed by the Constitution of Islamic Republic Pakistan, 1973, preamble of which says that the principles of democracy, freedom, equality, tolerance and social justice, as enunciated by Islam, shall be fully observed and independence of Judiciary fully secured. It also provided that the Muslims shall be enabled to ordain their lives in the individual and collective spheres in accordance with the teachings and requirements of Islam as set out in the Holy Qur'an and Sunnah. The Preamble is reflection of the Objectives Resolution which is inserted in the Constitution as Article 2A as substantive part of the Constitution by P.O. No. 14 of 1985. Article 2 of the Constitution states in unequivocal terms that Islam shall be the State religion of Pakistan. Part IX of the Constitution contains Islamic provisions in which Article 227 envisages that all existing laws shall be brought in conformity with the ,Injunctions of Islam as laid down in the Holy Qur'an and Sunnah. The Institution of Judiciary in Islam enjoys the highest respect and this proposition is beyond any dispute. The appointments of Judges and the manner in which they are made have close nexus with independence of Judiciary.
In the provisions relating to the Judicature in the Constitution, Article 175 provides that there shall be a Supreme Court of Pakistan, a High Court of each Province and such other Courts as may be established by law. Sub‑Article (2) thereof provides that no Court shall have any jurisdiction save as is or may be conferred on it by the Constitution or by or under any law. Sub‑Article (3) provides that the Judiciary shall he separated progressively from the Executive within fourteen years from the commencing day. After expiry of the stipulated period, this Court has given judgment in the case of Government of Sindh v. Sharaf Faridi and others PLD 1994 SC 105, and held on the subject of independence of Judiciary as under:‑‑
"That every Judge is free to decide matters before him in accordance with his assessment of the facts and his understanding of the law without improper influences,. inducements or pressures, direct or indirect, from any quarter for any reason; and
that the Judiciary is independent of the Executive and Legislature, and has jurisdiction, directly or by way of review, over all issues of a judicial nature'.
In this judgment this Court has further provided guidelines for financial independence of the Judiciary. The cut‑off date of 23rd March, 1996 has been given by this Court to enable the Provincial Governments for final separation of Judiciary from the Executive as envisaged in the judgment mentioned above.
We have examined in detail the special characteristics of our present Constitution in conjunction with its historical background and Islamic provisions while being fully cognizant of the powers of this Court to interpret the Constitution keeping in view the 'Doctrine of Trichotomy of Power', and have heard in detail with utmost patience not only the learned counsel appearing for the parties, but also the most senior counsel as amicus curiae, representatives of the Bar Associations of the Supreme Court and High Courts and the individuals who requested for hearing them on the subject of interpretation of provisions of the Constitution relating to the Judiciary. The valuable assistance rendered by all of them is very much appreciated.
Article 177 of the Constitution envisages that the Chief Justice of Pakistan shall be appointed by the President, and each of the other Judges of the Supreme Court shall be appointed by the President after consultation with the Chief Justice. As against, this, for appointment of Acting Chief Justice of Pakistan, Article 180 provides that when the office of the Chief Justice of Pakistan is vacant or he is absent or unable to perform the functions of his office, the President shall appoint the most senior of the other Judges of the Supreme Court to act as the Chief Justice of Pakistan. We are not going into the question of interpretation of these two provisions in the light of contention that criterion of the most senior Judge in the appointment of acting Chief Justice be impliedly read in the appointment of the Chief Justice of Pakistan for the reasons firstly that in Constitutional Petition No.29 of 1994, which is directly filed in this Court, appointment of the Acting Chief Justice was challenged on the ground that when there was clear vacancy after retirement, instead of Acting Chief Justice, the incumbent should have been appointed on permanent basis being the most senior. During pendency of the petition, permanent Chief Justice of Pakistan was appointed and, therefore, the petitioner did not press the prayer to that extent vide C.M.A. No.541‑K of 1996, dated 10th March, 1996. Secondly, proper assistance by the learned counsel on this point was also not rendered. Thirdly, the cases are pending in which the same subject‑matter is involved. For such reasons, we do not consider it proper to go into the question of interpretation of these two provisions.
Our conclusions and directions in nutshell are as under:‑‑
(i) The words "after consultation" employed inter alia in Articles 177 and 193 of the Constitution connote that the consultation should be effective, meaningful, purposive, consensusoriented, leaving no room for complaint of arbitrariness or‑unfair play. The opinion of the Chief Justice of Pakistan and the Chief Justice of a High Court as to the fitness and suitability of a candidate for judgeship is entitled to be accepted in the absence of very sound reasons to be recorded by the President/Executive.
(ii) That if the President/Executive appoints a candidate found to be unfit and unsuitable for judgeship by the Chief Justice of Pakistan and the Chief Justice of the High Court concerned, it will not be a proper exercise of power under the relevant Article of the Constitution.
(iii) That the permanent vacancies occurring in the offices of Chief Justice and Judges normally should be filled in immediately not later than 30 days but a vacancy occurring before the due date on account of death or for any other reasons, should be filled in within 90 days on permanent basis.
(iv) That no ad hoc Judge can be appointed in the Supreme Court while permanent vacancies exist.
(v) That in view of the relevant provisions of the Constitution and established conventions/practice, the most senior Judge of a High Court has a legitimate expectancy to be considered for appointment as the Chief Justice and in the absence of any concrete and valid reasons to be recorded by the President/Executive, he is entitled to be appointed as such in the Court concerned.
(vi) An Acting Chief Justice is not a consultee as envisaged by the relevant Articles of Constitution and, therefore, mandatory Constitutional requirement of consultation is not fulfilled by consulting an Acting Chief Justice except in case the permanent Chief Justice concerned is unable to resume his functions within 90 days from the date of commencement of his sick leave because of his continuous sickness.
(vii) That Additional Judges appointed in the High Court against permanent vacancies or if permanent vacancies occur while they are acting as Additional Judges, acquire legitimate expectancy and they are entitled to be considered for permanent appointment upon the expiry of their period of appointment as Additional Judges and they are entitled to be appointed as such if they are recommended by the Chief Justice of the High Court concerned and the Chief Justice of Pakistan in the absence of strong valid reasons/reasons to be recorded by the President/Executive.
(viii) That an appointment of a sitting Chief Justice of a High Court or a Judge thereof in the Federal Shariat Court under Article 203‑C of the Constitution without his consent is violative of Article 209, which guarantees the tenure of office, Since the former article was incorporated by the Chief Martial Law Administrator and the later article was enacted by the framers of the Constitution, the same shall prevail and, hence, such an appointment will be void.
(ix) That transfer of a Judge of one High Court to another High Court can only be made in the public interest and not as a punishment.
(x) That the requirement of 10 years' practice under Article 193(2)(a) of the Constitution relates to the experience/practice at the Bar and not simpliciter the period of enrolment.
(xi) That the simpliciter political affiliation of a candidate for judgeship of the superior Courts may not be a disqualification provided the candidate is of an unimpeachable integrity, having sound knowledge in law and is recommended by the Chief Justice of the High Court concerned and the Chief Justice of Pakistan.
(xii) That it is not desirable to send a Supreme Court Judge as an Acting Chief Justice to a High Court in view of clear adverse observation of this Court in the case of Abrar Hassan v. Government of Pakistan and others PLD 1976 SC 315 at 342.
(xiii) That since consultation for the appointment/confirmation of a Judge of a superior Court by the President/Executive 'with consultees mentioned in the relevant Articles of the Constitution is mandatory, any appointment/confirmation made without consulting any of the consultees as interpreted above would be violative of the Constitution and, therefore, would be invalid.
In view of what is stated above, we direct:
(a) That permanent Chief Justices should be appointed in terms of the above conclusion No.(iii), in the High Courts where there is no permanent incumbent of the office of the Chief Justice.
(b) That the cases of appellants Nos.3 to 7 in Civil Appeal No.805 of 1995 (i.e. additional Judges who were dropped) shall be processed and considered for their permanent appointment by the permanent Chief Justice within one month from the date of assumption of office by him as such.
(c) That appropriate action be initiated for filling in permanent vacancies of Judges in terms of above conclusion No.(iii).
(d) That ad hoc Judges working at present in the Supreme. Court either be confirmed against permanent vacancies in terms of Article 177 of the Constitution within the sanctioned strength or they should be sent back to their respective High Courts in view of above conclusion No. (iv).
(e) That the cases of the appointees of the Federal Shariat Court be processed and the same be brought in line with the above conclusion No.(viii); and
(f) That upon the appointment of the permanent Chief Justices in the High Courts where there is no permanent incumbent or where there are permanent incumbents already, they shall process the cases of the High Courts' Judges in terms of the above declaration No.13 within one month from the date of this order or ,within one month from the date of assumption of office by a permanent incumbent whichever is later in time and to take action for regularising the appointments/confirmation of the Judges recently appointment/confirmed inter alia of respondents Nos.7 to 28 in Civil Appeal No.805 of 1995 in the light of this short order. In like manner, the Chief Justice of Pakistan will take appropriate action for recalling permanent Judges of the Supreme Court from the High Courts where they are performing functions as Acting Chief Justices and also shall consider desirability of continuation or not of appointment in the Supreme Court of Ad Hoc/Acting Judges.
Resultantly, the direct petition and the appeal captioned above are allowed in the terms and to the extent indicated above. "
"I have recorded my separate reasons copy of which sent to H.C.J., HJ(5) and then HJ(6). The latter two agreed with me and signed the same with me on 24‑3‑1996. I adhere to my above reasons.
(Sd.)
AJMAL MIAN, J.
I also agree with the above reasoning.
(Sd.)
FAZAL ILAHI KHAN, J.
I also agree with above reasoning and have also recorded additional reasons.
(Sd.)
MANZOOR HUSSAIN SIAL, J.
Similarly, on the opinion recorded by Ajmal Mian, J. (as he 'then was) which was also signed by Fazal Ilahi Khan and Manzoor Hussain Sial, JJ. Manzoor Hussain Sial, J. added the following note:‑‑
"I agree with the judgment of my learned brother H.J.(2) but would like to add my reasons thereto.
(Sd. )
MANZOOR HUSSAIN SIAL, J."
It is, therefore, quite clear that the opinion recorded by both Sajjad Ali Shah, C.J. and Ajmal Mian, J., in the Judges' case are to be treated as the judgment of this Court. In the above‑stated background, we now proceed to examine the contentions of the learned counsel for the petitioners and the learned Deputy Attorney‑General in the above petitions. The learned counsel for the petitioners have raised the following contentions in support of the above petitions: ‑‑
"(i) That the short order pronounced by the Court in Judges' case on 20th March, 1996, is the only order which was subscribed by four out of five learned Judges of the Bench and therefore this order alone could be considered as the judgment of the Court in the case.
(ii) That the separate reasons recorded by the three learned judges of the Bench subsequently, cannot be treated as the judgment of the Court and anything said in those reasons which is not to be found in the short order is to be ignored.
(iii) That in terms of the short order of the Court, the respective Chief Justices of High Courts were required to process the cases of only the recently appointed/confirmed Judges for regularisation and therefore, this process could not be extended to de‑confirm or nullify the appointments of the Judges.
(iv) That the petitioners were de‑confirmed or the appointments were nullified by the Government without hearing them and as such the action of Government nullifying their appointments as Judges of the High Court offended against the principles of natural justice.
(v) That some of Judges were coerced by the authorities to tender their resignations and as such these resignations be declared invalid and inoperative.
(vi) That the petitioners could only be removed from their offices by following the procedure prescribed under Article 209 of the Constitution.
(vii) That the removal 'of the petitioners from the office of Judges of the High Court in the above manner amounted to a stigma and as such the petitioners were entitled to be heard.
(viii)That one of the petitioners (Ch. Mushtaq Ahmed Khan) was treated in a discriminatory manner inasmuch as that his batch‑mates were transposed as appellants/petitioners in the‑judges' case and were given relief of reinstatement but his case was differently, treated though circumstances in all these cases were identical; and
(ix) That in some cases the reason given for removal of the petitioners was the result of misreading of the record which vitiated the order of removal of petitioners from service.
The learned Deputy Attorney‑General in reply to the above contentions of the petitioners submitted as follows:‑‑
(a) That the short order and the reasons recorded in support of the short order subsequently by the learned Judges of the Bench are to he react together while giving effect. to it.
(b) That the conclusions recorded in the: short order of the case are in the nature of a judgment in rem. the directions given therein are ,judgment in personam while the reasoning,, are the roads to the destination. Therefore, all three are to be read together to achieve the purpose anti .object of the decision.
(c) That the reasons recorded by Chief Justices of the, High Courts arid the Hon'ble Chief justice of Pakistan regarding competency or otherwise of a candidate for judgeship if accepted by the executive/President, were not Justiciable and, therefore, the same cannot be challenged on the principle of audi alteram partem.
(d) That. some of the petitioners approached this Court after considerable delay and having acquiesced in the action and therefore, they could not be allowed to challenge the action of the Government now.
(e) That the direction given by this Court in the Judges' case for processing and regularisation of the cases of recently appointed/confirmed judges did not mean that the Hon'ble Chief Justices while processing such cases had to take only such steps as were necessary to regularise the appointment and they could not recommend their removal or non‑confirmation as Judges of the High Courts.
(f) That some of the petitioners having resigned from their offices as judges of the High Court were not entitled to file the present petitions and re‑agitate the matter, and
(g) That reference to recently appointed/confirmed judges in the short order did not mean only those judges who were appointed within the close proximity of the date of the short order.
Before considering the above contentions, it would be appropriate to first decide the plea of the petitioners that only short order dated 20th March, 1996 in Judges' case is to be treated as the order of the Court and that the reasons recorded subsequently by the learned Judges‑ separately are to be ignored while implementing the direction of the Court. We are unable to subscribe to this view. The short order in a case is the summary of the findings of the Court while detailed reasons are elaboration of that summary. Unless there is any conflict between the short order and the detailed reasons, both are to be read together to understand the real import, and scope of the judgment. We have carefully gone through the short order and the detailed reasons recorded in support of the short order by Sajjad Ali A Shah, C.J. and Ajmal Mian, J. and are of the view that there is no conflict between the short order and the detailed reasons recorded subsequently by the learned Judges of the Bench in support of the short order. We are, therefore, of the view that the short order dated 20th March, 1996 send the reasons recorded in support thereof by the learned Judges 1Sajjad Ali Shah, C.J. and Ajmal Mian. J. subsequently are to be react together to give effect to the judgment in Judges' case.
The contentions raised by the learned counsel for the petitioners in support of the above petitions may be divided in two broad categories for the sake of convenience.. The first category includes the contentions which are common to‑ all the above petitions. In the second category, fall the pleas which are peculiar to individual cases. We will, therefore, first deal with the contentions which are common in all the above petitions. Broadly speaking, these are three main. contentions. The first contention is, that the direction given by this Court in the Judges' case to, the respective Hon'ble Chief Justices of the High Courts for processing and regularisation of the cases of the recently appointed/confirmed judges, did not mean that the Hon'ble Chief Justices of the High Courts while processing these cases could also recommend their removal on non‑confirmation as Judges of the High Courts It is contended vehemently that the word 'regularisation' did not cover within its meaning, the recommendations for de‑confirmation or removal from the. office of judgeship. The second contention common in all the above petitions is, that the removal/de‑notification of the, judges by the Government in pursuance of the recommendations of the Chief Justices of the High Courts and the Chief Justice of Pakistan, was opposed to the principles of natural justice and as such the action taken by the Government in this behalf is liable to be struck down as without jurisdiction and void. The third contention common in all these cases, is that a judge once appointed could only be removed in accordance with the provisions of Article 209 of the Constitution, whereas the petitioners were removed/de‑notified without following the procedure prescribed under Article 209 of the Constitution. It is, accordingly, contended that the removal of the petitioners from their respective offices as Judges of the High Court was unconstitutional and void. We will take up the above three contentions in. the same order in which they are raised.
The first common contention is that the word 'regularisation' used in paragraph (f) of the short order did not mean or permit the Hon'ble Chief Justices of the High Courts to recommend removal or non‑confirmation of the judges. It is contended that the word 'regularisation' means to make regular which could not be interpreted to. mean refusal to make regular. It is argued on behalf of the petitioners that the only defect discoverable in the appointment/confirmation of the petitioners as judges of the High Court was that they were recommended for appointment/confirmation by the Acting, Chief Justices instead of permanent Chief Justices and therefore, this defect in their appointments could be regularised in terms of the short order dated 20th March, 1996 by making the same recommendations by the permanent Chief Justices of the respective High Courts. The argument on its face may appear to be attractive but it cannot stand scrutiny in terms of the judgment of this Court in Judges' case. We have already reproduced earlier the short order in Judges' case. Conclusion No.xiii recorded in° the short order declared the appointments/confirmation of the Judges of the High Court made by the Government in consultation with the Acting Chief Justices violative of the mandatory provision of the Constitution and therefore, invalid. This conclusion when read with direction No. (f) of the short order made it clear that this invalidity in the process of consultation in making the appointment/confirmation of the judges, was to be removed by a fresh processing of the cases by the permanent Chief Justices keeping in view the provisions of Article 193 of the Constitution. Therefore, if the Hon'ble Chief Justices of the High Courts and the Chief Justice of Pakistan in that process were of the opinion that any of the incumbents was not fit for appointment or confirmation or lacked the qualification prescribed in Article 193 of the Constitution for appointment as a Judge of the High Court, they were entitled to express their opinion, accordingly, within the scope of direction No.(f) of the short order.
The second contention of the petitioners common in the above cases is, that petitioners' removal/non‑confirmation as Judges of the High Court was violative of the principles of natural justice as they were not heard or given any hearing by the Chief Justices before recommending their removal/de‑notification. The appointment of an additional judge of the High Court is for a specified period. Such appointment, therefore, comes to an end on expiry of the period mentioned in the notification appointing the additional judge of the High Court, unless the period is further extended or the appointment is converted into a Judge of the High Court. Therefore an Additional Judge ceases to hold the office if the period specified in the notification appointing him as an Additional Judge is not extended. In such an eventuality. he cannot claim hearing before expiry of the period mentioned in the notification. However, this Court in, its judgment in Judges' case observed that additional judges appointed in the High Court against permanent vacancies or if permanent vacancies occur while such judges are performing functions as additional judges, they acquire a legitimate expectancy and they are entitled to be considered for permanent appointment on expiry of their period as additional judges if they are recommended by the Chief Justice of the High Court concerned and the Chief Justice of Pakistan. The above conclusion recorded in the short order were explained in the opinion rendered in the Judges' case by Ajmal Mian, J. (as he then was) as follows:‑‑
"If we were to read carefully sub‑clause (a) of clause (2) of Article 193 of the Constitution, it becomes evident that 10 years period referred to in sub‑clause (a) thereof relates to experience and not the period of enrolment. Under clause (b) thereof not less than 10 years' period is provided for civil servants for being eligible for consideration for appointment as a Judge of the High Court and out of the above 10 years, it has been provided that for a period of not less than three years. he must have served as or exercised the functions, of a District Judge in Pakistan. The above sub‑clause (b) speaks of actual experience in service and, therefore, if it is to be read with sub‑clause (it), it becomes evident that sub‑clause (a) 'NO refers to the experience. In any case, it is a matter for consideration by the Chief Justice of the High Court concerned and the Chief Justice of Pakistan. They have to decide, whether a particular candidate has requisite experience and once they form the view that the candidate has the requisite experience as envisaged by sub‑.D clause (a) of clause (2) of Article 193, this issue will not be justiciable before the Court of lacy. The Court cannot sit and decide whether a particular person has the requisite experience or not'? It is a matter of subjective satisfaction of the Chief Justice of the ±!ighl Court concerned and the Chief Justice of Pakistan."
('The underlining is by its to supply emphasis).
In view of the above‑quoted observations of Ajmal Mian, J. it is quite clear that the recommendations of the Chief Justice of the High Court and that of Chief Justice of Pakistan are not, justiciable.
In these circumstances, we are inclined to hold that where the Chief Justice of the High Court‑concerned and the Chief Justice of Pakistan do not recommend a particular incumbent for confirmation or appointment as a Judge of the High Court and these recommendations are accepted by the President Executive, the same cannot be brought under challenge in the Court on the ground that the incumbent was not heard before making such recommendations. We, therefore, find no force in the 2nd.contpntion raised on behalf of the petitioners in the above cases.
The last common contention of the petitioners in these cases is that a judge once appointed in the High Court could not be removed, except in accordance with the provisions contained in Article 209 of the Constitution. The scope of Article 209 of the Constitution was examined in the case Asad Ali v. Federation of Pakistan PLD 1998 SC 161 at length and the following unanimous conclusions were recorded:‑‑
"80. At this stage, we may also deal with another argument advanced by Mr. Abdul Hafeez Pirzada, the learned counsel for respondent No.2, in this behalf. Mr. Abdul Hafeez Pirzada, very vehemently argued that the only method provided under the Constitution to remove a Judge of the superior Court from his office is, to initiate proceedings against him before the Supreme I Judicial Council as provided under Article 209 of the Constitution, Article 209 of the Constitution referred by the learned counsel reads as under:‑‑
"209.‑‑(I) There shall be a Supreme Judicial Council of Pakistan, in this Chapter referred to as the Council.
(2) The Council shall consist of‑‑
(al the Chief Justice of Pakistan;
(b) the two next most senior Judges of the Supreme Court; and
(c) the two most senior Chief Justices of High Courts.
Explanation.‑‑ For the purpose of this clause. the inter se seniority of the Chief Justices of the High Courts shall be determined with reference to their dates of appointment as Chief Justice. and in case the dates of such appointment are the same, with reference to their dates of appointment as Judges of any of the High Courts.
(3) If at any time the Council is inquiring into the capacity or conduct of a Judge who is it member of the Council, or a member of the Council is absent or is unable to act due to illness or any other cause, then‑‑
(a) if such member is a Judge of the Supreme Court, the Judge of the Supreme Court who is next in seniority below the Judges referred to in paragraph (b) of clause (2), and
(b) If such member is the Chief Justice of a High Court, the Chief Justice of another High Court. who is next in seniority amongst the Chief Justices of the remaining High Courts, shall act as a member of the Council in his place.
(4) If, upon any matter inquired into by the Council, there is a difference of opinion amongst its members the opinion of the majority shall prevail, and the report of the Council to the President shall be expressed in terms of the view of the majority.
(5) If, on information received from the Council or from any other source, the President is of the opinion that a Judge of the Supreme Court or of a High Court‑‑
(a) may be incapable of properly performing the duties of his office by reason of physical or mental incapacity; or
(b) may have been guilty of misconduct, the President shall direct the Council to inquire into the matter.
(6) If, after inquiring into the matter, the Council reports to the President that it is of the opinion‑‑
(a) that the Judge is incapable of performing the duties‑of his office or has been guilty of misconduct, and
(b) that he should be removed from office, the President may remove the Judge from office.
(7) A Judge of the Supreme Court or of a High Court shall not be removed from office except as provided by this Article.
(8) The Council shall issue a Code of Conduct to be observed by Judges of the Supreme Court, and of the High Courts."
In view of the above‑stated legal position, we are of the view that the recommendations of the Chief Justices of the High Court concerned and that of Chief Justice of Pakistan in respect of fitness or otherwise of a person to be appointed/confirmed as a Judge of the High Court would not fall within the scope of Article 209 of the Constitution. We, accordingly, repel the 3rd common contention of the petitioners in the above cases.
Having dealt with the above three contentions which are common in the above petitions, we now take up the individual petitions to examine the remaining relevant contentions in each case separately. At this stage, we may mention that in some of the above petitions, the petitioners contended that although they were not aware of the exact recommendations of the Chief Justices of the High Courts and that of Chief Justice of Pakistan but they understand that the Chief Justices of the High Courts and the Chief Justice of Pakistan, had recommended their confirmation as Judges of the High Courts but contrary to these recommendations they were not confirmed or allowed to continue as Judges of the High Courts. The petitioners further jointly contended that at no stage, they were informed about the grounds on which they were found unfit to hold the office of the Judge of the High Court and as such their non‑confirmation as Judges of the High Court was against the principle of natural justice.
In view of the preceding discussion, the petitioners were neither entitled to be informed about the recommendations made by the respective Hon'ble Chief Justice of the High Courts and the Hon'ble Chief Justice of Pakistan, in their cases regarding their suitability or otherwise for continuation/confirmation‑as Judges of the High Courts, nor they were
entitled to be heard in respect of such recommendation. However, in order to satisfy ourselves that the petitioners were de‑notified by the Government as Judges of the High Court in accordance with the recommendations of the respective Chief Justices of the High Courts and the Chief Justice of Pakistan, we have consulted the official record and are satisfied that President/Executive had acted in accordance with recommendations of the respective Chief Justices of the High Courts and the Chief Justice of Pakistan, in de‑notifying the appointments of the petitioners as Judges of the High Courts anti in no case the de‑notification of the petitioner was contrary to the recommendations of the Chief Justice of High Court and the Chief Justice of Pakistan. We now proceed .to take up each petition separately to examine it on merits and to decide the remaining contentions in these cases in so far they are applicable to each of these cases.
Constitutional Petition No: 49 of 1996
The petitioner, Ch. Mushtaq Ahmed Khan, was appointed as Additional Judge of Lahore High Court, for a period of. two years along with 8 others vide notification dated 26th August, 1992. On expiry of the period of two years, the tenure of Ch. Mushtaq Ahmed Khan was extended for a further period of one year vide notification dated 28th August, 1994. Before expiry of the extended period of his tenure, Ch. Mushtaq Ahmed Khan was appointed as the Judge of the Lahore High Court vide notification dated is( June, 1995. His appointment as Judge of the .Lahore High Court was denotified by the Government on 30-9‑1996.
The additional contention of the petitioner in this case is, that he was recommended for appointment as an Additional Judge of Lahore High Court by the permanent Chief Justice of Lahore High Court and as such his case did not fall within the mischief of condition number xiii and direction number (f) of the short order in the Judges' case. It is further contended that under direction number (f) of the short order in Judges' case, only the cases of the recently appointed Judges of the High Courts were to be processed and regularised and as the petitioner was appointed in 1992 and was confirmed in June. 1995 long before the date of judgment in the Judges' case, his case could not be re‑opened under direction number (f) of the Judges' case. It is . also contended that other Judges of Lahore Court who were appointed along with the petitioner in 1992 and were not confirmed were transposed as appellants in the Judges' case and were granted relief by way of confirmation as Judges of the Lahore High Court under the orders of this Court while the petitioner was denied that relief though he was a confirmed Judge.
The petitioner is a senior advocate of this Court and has a lucrative practice. We, therefore, enquired from him during the course of the arguments if he was really interested, in seeking his restoration as Judge of Lahore High Court. He very candidly stated that the real purpose of this petition is to vindicate his honour and he will be satisfied and will not seek restoration to the office of the Judge, if his de‑notification is declared invalid. .
The case of the petitioner is distinguishable from the cases of the other Judges of Lahore High Court who were not confirmed/de‑notified as the Judges of the High Court of Lahore. The petitioner was appointed as the Additional Judge of Lahore High Court vide notification dated 26‑8‑1992 on the recommendations of Mian Mahbub Ahmed, Chief Justice, who was the permanent Chief Justice of Lahore High Court. Therefore, to the extent that the initial appointment of the petitioner did not suffer from any constitutional infirmity the argument appears to be correct. However, his tenure as Additional Judge of High Court was extended for one year on 28‑6‑1994 oft the recommendation of the Acting Chief Justice of Lahore High Court (Mr. Justice Muhammad llyas) and the then Chief Justice of Pakistan (Mr. Justice J Sajjad Ali Shah). Similarly, the confirmation of the petitioner as a Judge of Lahore High Court was also made on the recommendations of the Acting Chief Justice of Lahore High Court (Mr. Justice Muhammad llyas). Therefore, though the initial appointment of the petitioner its the Additional Judge of Lahore High Court did not suffer from any constitutional infirmity, his confirmation as the Judge of Lahore High Court fell within the mischief of conclusion number xiii of the short order in the judges' case, and accordingly, his case needed fresh processing and regularisation within the scope of direction number (t1 of the short order in Judges' case.
The petitioner has contended that his case was not covered within the meanings of the expression "recently appointed judges" used in direction number (f) of the short order in Judges' case. We have already reproduced the short order in Judges' case earlier in this judgment. The expression used in direction number (f) of the short order is ",judges recently appointed/confirmed". The effect of direction number (t) of the short order was explained in para number 87 of the judgment of Sajjad Ali Shah, C.J. (as he then was) as follows:‑‑
"The meaning and scope of "consultation" now laid down by us and the powers of Acting Chief Justices in connection therewith would affect only such appointments which have been made by the present Government and this exercise would not go beyond that. We are leaving it open that the appointments made with the 'recommendations' of the Acting Chief Justices in the High Courts can be re‑viewed and steps can be taken by the permanent Chief Justices to regularise them this call be done on the basis of merit within thirty days from the date when the permanent Chief Justices are appointed in the High Courts and take oath. Regularisation shall take place as contemplated under Article 193 of the Constitution."
The petitioner's confirmation as the Judge of Lahore High Court K having taken place on the recommendation of Acting Chief Justice, it was not a valid confirmation within the meaning of conclusion number xiii of the short order and as such the petitioner case required processing and regularisation in terms of direction number (f) of the short order in Judges case. .
We have gone through the official record and noticed that the Chief Justice of Lahore High Court (Mr. Justice Khalil-ur-Rehman Khan) and the then Chief Justice of Pakistan (Mr. Justice Sajjad Ali Shah) did not recommend the name of petitioner for confirmation as a Judge of the Lahore High Court. As observed earlier by us, the recommendations of the Chief Justice of High Courts and the Chief Justice of Pakistan are not justiciable, therefore, no relief can be granted to the petitioner in the circumstances. However, as the petitioner's confirmation as a Judge of Lahore High Court I on 1‑6‑1995 was rendered invalid by force of the judgment of this Court in the Judges case, he shall be deemed to have not been confirmed as a Judge:" of the Lahore High Court and shall be entitled to practice before that Court
Constitutional Petition No.59 of 1997
The petitioner in this case was appointed as the Additional Judge of Lahore High Court alongwith 19 others on 4‑8‑1994 for a period of one year. On 1st of June, 1996, he was appointed as the Judge of Lahore High Court. Since the appointments of the petitioner as the Additional Judge and the Judge of the Lahore High Court were made after consultation with the Acting Chief Justice of Lahore High Court, these appointments were invalid in terms of conclusion number xiii of the short order in Judges' case. The appointment of petitioner, therefore, required processing and regularisation in accordance with the direction number (f) of the short order. The petitioner, however, resigned from his office as the Judge of Lahore High Court on 18‑6‑1996. The petitioner having resigned from his office as a Judge of Lahore High Court, cannot now challenge his de‑notification as a Judge of the Lahore High Court. The petitioner, however, is right in contending that he cannot be declined the right of practice before the Lahore High Court as his confirmation as Judge of the Lahore High Court was rendered invalid under conclusion number xiii of the short order in the Judges' case. We, are accordingly, of the view that though the petitioner is not entitled to the relief of reinstatement, he is entitled to practice as an advocate before the Lahore High Court.
Constitutional Petitions Nos. 47/96 50/96, 24/98 and 44/98
The petitioners in petitions No.47/96, 50/96 and 44/98 were appointed alongwith 17 others as Additional Judges of Lahore High Court vide notification dated 4th of August, 1994 for a period 'of one year. Similarly, the petitioner in Constitutional Petition No.24/98 was also appointed alongwith 4 others as an Additional Judge of Lahore High Court for a period of one year vide notification dated 9th October, 1995. The petitioners in Petition No.47/96, 50/96 and 44/98 were later appointed as Judges of Lahore High Court on 19th March, 1996, a day before the announcement of the judgment in the Judges' case. It is an admitted position that the petitioners were appointed as Additional Judges or as Judges of Lahore High Court after consultation with the Acting Chief Justice of Lahore High Court. In view of the conclusion No.xiii of the short order in the Judges' case, the appointments of the petitioners were rendered invalid and their cases were required to be processed for regularisation .in terms of direction No.(f) of the short order. We have consulted the record maintained in respect of the appointment of the petitioners and find that none of the petitioners was recommended for retention/confirmation as a Judge of the High Court by the Chief Justice of the Lahore High Court or the Chief Justice of Pakistan. We have already held that the recommendations of the Chief Justices of the High Courts and that of the Chief Justice of Pakistan are not justiciable in Court and therefore, in view of our above findings, the denotification of the petitioners is not open to any exception. The petitioners are, accordingly, not entitled to any relief in the present proceedings.
Constitutional Petitions No.7 and 25 of 1998
The. petitioners in the above petitions were appointed as Additional' Judges of Peshawar High Court vide notification dated 9th October, 1995 for a period of one year. By virtue of the decision of this Court in the Judges' case, their appointment was rendered invalid as they were appointed as Additional Judges after consultation with Acting Chief Justice of Peshawar High Court. The cases of the petitioners were, accordingly, required to be processed and regularised in terms of direction number (i) of the short order in the Judges' case. The petitioners were not recommended for retention/confirmation as Judges of the High Court by the permanent Chief Justice of Peshawar High Court and the Hon'ble Chief Justice of Pakistan. The petitioners were, accordingly, informed by the Governor, N.‑W.F.P., vide his letter dated 7th August, 1996 that they were not recommended for appointment as Judges of the High Court as they did not possess the required experience. They were asked by the Governor, N .‑W . F. P. , to supply the necessary details if they so desired. The petitioners in the above petitions, however, resigned from their offices as Judges of the High Court in response td the letter received by them from the Governor, N.‑W.F.P. The petitioner in Constitutional Petition No.7 of 1998 has contended before us that he was forced to resign by the Governor and therefore, his resignation should not be taken info consideration. The contention cannot be accepted as there is no material on record before us to hold that the petitioner was forced by the Governor, N.W.F:P., to resign from the office of Judge of the High Court. The Governor N.‑W.F.P. had issued identical letter to the other Additional Judges of the Peshawar. High Court who were affected by the judgment of this Court in the Judges' case but none of them complained that the Governor N.‑W. F. P. prevailed upon them, to resign from the office of Judge of the High Court. Apart from it, the petitioner was allegedly forced to resign from the office of Judge of High Court in August 1996 but he kept quite until 25th of April, 1998 when he filed the present petition and for the first time, raised‑this contention. The petitioner in Constitutional Petition No.25 of 1998. also resigned from the office of Judge of Peshawar High., Court like petitioner in Constitutional Petition No.7 of 1998. He has not alleged that he was forced by the Governor N,‑W.F.P. to resign from his office, We otherwise find it difficult to believe that the Governor, N.‑W.F.P. who had issued identical letters to all the judges who were not to be confirmed in pursuance of the order of this Court in Judges' case, would have forced the petitioner in Constitutional Petition No.7 of 1998 to tender his resignation. The petitioners in the above two petitions having already tendered resignation from their offices as Judges of the High Court, cannot he allowed to turn round and challenge the same after a period of about two years. Apart from it, as earlier pointed out by us, the recommendations of the Chief Justice of the High Court and that of the Chief Justice of Pakistan are not justiciable in any Court and therefore, if the petitioners were not confirmed or allowed to continue as Judges of the High Court in pursuance of the recommendations of the Chief Justice of Peshawar High Court and the Chief Justice of Pakistan, they cannot question such recommendations in the present proceedings. The petitioners are, therefore, not entitled to any relief in the present proceedings.
Constitutional Petition No.39 of 1998
The petitioner in the above petition was appointed as Additional Judge of Peshawar High Court vide notification dated 13‑12‑1993 alongwith 3 others. He was later appointed as Judge of Peshawar High Court after consultation with the Acting Chief Justice of Peshawar High Court. His appointment as an Additional Judge and as a Judge of Peshawar High Court having been made after consultation with the Acting Chief Justice of Peshawar High Court, was rendered invalid as a result of conclusion No.xiii of the short order in the Judges' case. The case of the petitioner was, accordingly, required to be processed and regularised in terms, of the direction number (f) of short order in the Judges' case. The petitioner was not recommended for retention as a Judge of Peshawar High Court either by the Chief Justice of Peshawar High Court or by the Chief Justice of Pakistan during the process of regularisation. He was, however, informed by the Governor. N.‑W.F.P., that as he did not possess 10 years active practice, therefore, he could not be confirmed as a Judge of Peshawar High Court. He was also given the option to resign from the office of the Judge of the High Court if he so desired but he did not accept this suggestion. The petitioner contends that the ground for his removal from the office of the Judge of Peshawar High Court that he did not possess the requisite 10 years active practice; was the result of misreading of the date of his enrolment as 6‑2‑1989 which was actually 8‑2‑1979. To this extent, this contention of the petitioner appears to be correct. However, from the record, it appears that the petitioner was otherwise not recommended either by the Chief Justice of Peshawar High Court or by the Chief Justice of Pakistan for retention as a Judge of Peshawar High Court. Apart from it, the petitioner admitted before its that after he was de‑notified as Judge of Peshawar High Court, he was recommended for appointment as the Additional Judge of Peshawar High Court in April, 1997 by the Chief Justice of Peshawar High Court to which he consented. He was once again considered and recommended by the Chief Justice of Peshawar High Court in 1998 for appointment as an Additional Judge of the High Court to which also he consented. In these circumstances, P the petitioner cannot be permitted now to challenge his de‑notification as the judge of Peshawar High Court. We are, however, of the opinion that denotification of the petitioner in September, 1996 as a Judge of the Peshawar High Court should not come in the way of his fresh appointment as a Judge of that Court if he is again recommended for that office in accordance with the law specially for the reasons that after his de‑notification two successive Chief Justice of the Peshawar High Court at different times, recommended him for appointment as the Additional Judge of the Peshawar High Court. With these observations, we decline to grant any relief in the present proceedings.
Constitutional Petitions Nos.43 and 44 of 1996
The petitioners in the above two petitions were appointed as Additional Judges of High Court of Sindh by notification dated 6th of June, 1994 for a period of one year after consultation with the Acting Chief Justice of Sindh High Court. They were later confirmed as Judges of High Court of Sindh by notification dated 31st May, 1995 after consultation with Acting Chief Justice of that Court. Their cases were reprocessed for regularisation in view of the judgment of this Court in Judges' case and they were not recommended for being retained as Judges of the High Court of Sindh with the result their appointments as Judges of the High Court were de‑notified on 30th of September, 1996. They have challenged their de‑notification in the present proceedings.
We have consulted the record maintained in respect of the appointment of Judges of High Court of Sindh and find that both the petitioners were not recommended by the permanent Chief Justice of High Court of Sindh as well as learned Chief Justice of Pakistan and as a result of these recommendations their appointments were de‑notified. As we have already held in these cases that the recommendations of the Chief Justice of a High Court and that of the Chief Justice of Pakistan are not justiciable, no relief can be granted to the petitioner in the present proceedings as they were not recommended for retention/confirmation as Judges of the High Court. It may also be added here that in so far petitioner in petition No.44 of 1996 is i concerned, he has already attained the age of superannuation i.e. 62 years and therefore, for this reason too, he cannot be granted any relief now.
dismissed.
(Sd.)
SAIDUZZAMAN SIDDIQUI, C.J.
(Sd.)
IRSHAD HASAN KHAN, J.
I have given a short note of my own whereby I have expressed my inability to agree with the proposed judgment.
(Sd.)
RAJA'AFRASIAB KHAN, J.
Separate note attached.
(Sd.)
MUHAMMAD BASHIR JEHANGIRI, J.
(Sd.)
NASIR ASLAM ZAHID, J.
RAJA AFRASIAB KHAN, J.‑‑‑I have the privilege to peruse the proposed judgment rendered by the Hon'ble Chief Justice of Pakistan. After hearing the learned counsel for the parties and perusing the record, I have come to the conclusion that there is no other option for me but to uphold the S view already expressed by me on the controversy Reference in this behalf may be made to Habib‑ul‑Wahab‑Al‑Khairi and others v. Federation of Pakistan and others PLD 1995 Lahore 27. I, therefore, with utmost respect, cannot agree with the proposed judgment of the Hon'ble Chief Justice.
(Sd.)
RAJA AFRASIAB KHAN, J.
MUHAMMAD BASHIR JEHANGIRI, J.‑‑‑While generally) agreeing with the conclusions arrived at by the Honourable Chief Justice in a well‑considered judgment, I am constrained to add a few lines as I look at the cases of two de‑notified Judges, namely, Ch. Mushtaq Ahmad and Mr. Salim Dil Khan which are distinguishable at least on factual plane and should have been looked at differently if not sympathetically. The judgment in Judges case no doubt was a landmark in the annals of judicial history. But it was the implementation of the judgment which left much to be desired.
In the case of Ch. Mushtaq Ahmad, if ultimate recommendations for his confirmation by Justice (Retd.) Ch. Muhammad Ilyas, the then Acting Chief Justice, were not in accord with the guidelines prescribed in. the judgment in 'Judges case', the earlier recommendation of the same Acting Chief Justice for extension of this period as Ad hoc Judge ought to have also been ignored. He unfortunately, like some others, had been a victim of perhaps personal reasons weighing with those who were at the helm of affairs at that crucial juncture. Additionally those Judges were victims of a sustained venomous whispering campaign and, therefore, their career was sacrificed at the altar of technical grounds.
In my considered view another case in point is that of Mr. Salim Dil Khan, a former Judge of Peshawar High Court. He has been the victim of sheer venomous personal vendetta. So much so his particulars of active practice at the bar were forged to render his case to fall under disqualification.
Such cases were obviously the outcome of violation of the principle of natural justice, namely, 'audi alteram partem' which superior Court quote in their judgments day in and day out.
I am, therefore, reluctantly constrained to add that the case of Ch. Mushtaq Ahmad could have been dealt with a more equitable setting in order to vindicate his honour and repute even by allowing pension if it was due to him on the basis of length of service on the Bench and addition of some more pacifying remarks in his favour.
I have decided to refrain from making further observations in the case of Mr. Salim Dil Khan as some relief has been impliedly granted to him, namely, qua his eligibility for his re‑elevation to the Bench.
(Sd.)
MUHAMMAD BASHIR JEHANGIRI, J.
M. B. A./G‑57/S Orders accordingly.
P L D 2000 Supreme Court 207
Present: Saiduzzaman Siddiqui, CJ, Nasir Asdam Zahid and Abdur Rehman Khan, JJ
LAHORE DEVELOPOMENT AUTHORITY
through D.G., Lahore and another‑‑‑Appellants
versus
ABDUL SHAFIQUE and others‑‑‑Respondents
Civil Appeals Nos.402 to 413 of 1993, 90 and 91 of 1994, decided on 1st December, 1999.
(On appeal from the judgment of Lahore High Court, Lahore, dated 14‑7‑1992, passed in W.Ps. Nos.2924/86, 6034/87, 4235/91, 7655/91, 9817/91, 9819/91, 9820/91, 3361 /91, 3362/91, 1540/92, 9106/91, 91 10/91, 2671 /91 and 2672/91 respectively).
(a) West Pakistan Industrial and Commercial Employment (Standing Orders) Ordinance (VI of 1968)‑‑‑
‑‑‑S. 4(a)‑‑‑Industrial Relations Ordinance (XXIII of 1969), S.2(xiv)‑‑Lahore Development Authority Act (XXX of 1975), S.6‑‑‑Constitution of Pakistan (1973), Art. 185(3)‑‑‑Industrial or commercial establishment‑‑‑Leave to appeal was granted by Supreme Court to examine the contention that Lahore Development Authority, a statutory body, being neither industrial nor commercial establishment, provisions of West Pakistan Industrial and Commercial Employment (Standing Orders) Ordinance, 1968 were not applicable.
(b) West Pakistan Industrial and Commercial Employment (Standing Orders) Ordinance (VI of 1968)‑‑‑
‑‑‑‑S. 4(a)‑‑‑Industrial Relations Ordinance (XXIII of 1969), S.2(xiv)‑‑Lahore Development Authority Act (XXX of 1975), S.6‑‑‑industrial or commercial establishment‑‑‑Functions performed 'by Lahore Development Authority were such that Authority could be said to be "industry" within the meaning of Industrial Relations Ordinance, 1969.
Lahore Development Authority was not only 'empowered to prepare, implement and enforce the Metropolitan Development Plan and Annual Development Programme but also prepare, implement and enforce schemes for environmental improvements. Housing, water supply, sewerage, drainage, solid waste disposal, transportation and traffic health facilities as also sell, lease, exchange and dispose of any property, undertake any work, incur any expenditure. In addition to rendering various services, like sewerage, water supply, drainage, solid waste disposal, the Authority was also engaged in construction of roads, flats and houses. For the purposes of implementing its schemes, land acquired by the Authority was developed by it and a part thereof was sold in form of plots to the general public through auction on or negotiations as the case may be. It was, thus, difficult to accept the contention that the Authority was not rendering any service and was, therefore, not an industry within the meaning of the Industrial Relations Ordinance, 1969.
The Authority therefore fell within the meaning of an "Industry".
Agriculture Workers' Union v. Registrar of Trade Unions 1997 SCMR 66 fol.
K.G. Old, Principal, Christian Technical Training Centre, Gujranwala v. Presiding Officer, Punjab Labour Court PLD 1976 Lah. 1097; A.F. Ferguson & Co. v. Sindh Labour Court PLD 1985 SC 429; Employees' Union, Jamia Karachi v. Registrar of Trade Unions, Sindh and others 1981 PLC 403; Lahore Development Authority (WASAI Salah‑ud-Din 1983 PLC 281; Government of Balochistan v. Livestock Employees' Union 1993 PLC 13 and Livestock Employees' Union, Agricultural Baildar Employees' Union and Forest Employees and Workers Union v. Government of Balochistan and others C.P.L.As. Nos.66‑Q, 67‑Q 74‑Q of 1992) ref.
(c) Interpretation of statutes‑‑‑
‑‑‑‑Beneficial legislation has to be construed liberally and beneficially.
(d) industrial Relations Ordinance (XXIII of 1969)‑‑‑
‑‑‑‑Preamble‑‑‑Nature of the Ordinance and its construction‑‑‑Industrial Relations Ordinance, 1969 being basically a beneficial legislation, has to be a construed liberally and beneficially.
Javed Altaf, Advocate Supreme Court and A. Aasim Jafri, Advocate‑on‑Record (absent) for Appellants.
Ch. Muhammad Akram, Advocate Supreme Court sand Mehr Khan Malik. Advocate‑on‑Record for Respondents (in C.As. Nos. 406. 410 of 1993 and C. As. Nos. 90 and 91 of 1994).
Date of hearing: 1st December, 1999. .
JUDGMENT
SAIDUZZAMAN SIDDIQUI, C.J.‑‑‑The leave granting order in the abovementioned 14 Appeals reads as follows:‑‑
"This order will deal with C.Ps. Nos.994 to 1005/L of 1992.
' (1) Petitioner Lahore Development Authority seeks leave to .appeal against orders of a learned Judge of the Lahore High Court in Writ Petition No.2924 of 1886 dated 26‑5‑1992 and in connected matters.
(2) Relevant facts are that the petitioner terminated the services of its employees, the respondents Whereupon they successfully challenged the orders before the Labour Courts. The petitioner's Constitution petitions failed in the Lahore High Court.
(3) Contention of the learned counsel for the petitioner is that West Pakistan Industrial and Commercial Employment (Standing Orders) Ordinance, 1968 applies vide section 4(a) to "industrial or commercial establishment". Lahore Development Authority is not an industrial not a commercial establishment. In this view of the matter the learned counsel submits that there is no need to go on to consider or apply the proviso which reads as follows:
'Provided that nothing in this Ordinance shall apply to industrial and commercial establishments carried on by or under the authority of the Federal or any Provincial Government, where statutory rules of service, conduct or discipline are applicable to the workmen employed therein'.
Contention is that the petitioner being neither industrial nor commercial establishment, its being carried on under the authority of the Provincial Government would not arise, though if it were it were such an establishment it was under the Provincial Government. In that event statutory rules of service framed under section 45 of the Lahore Development Authority Act, though called regulation were promulgated in 1978 and approved by the competent authority. Their publication in the Gazette subsequently would not affect their applicability as those were not required to be gazetted by the Statute. Interpretation of several statutes is involved. Therefore, leave to appeal is granted."
We have heard Mr. Javed Altaf, Advocate Supreme Court, for appellants while Ch. Muhammad Akram, Advocate Supreme Court has appeared for respondents only in four appeals. Rest of the respondents have not defended the appeals.
The above appeals arise out of proceedings initiated by the respondents under section 25‑A of Industrial Relations Ordinance, 1969 (I.R.O.) The appellants who were respondents in the proceedings commenced under section 25‑A of the I.R.O. resisted the same on merits as well as on the ground that provisions of I.R.O. or West Pakistan Industrial and Commercial Employment (Standing Orders) Ordinance, 1968 (hereafter to be referred as 'the Ordinance') did not apply to the dispute raised by the respondents. The Labour Court rejected the legal objection and having found on merit that dismissal of respondents was not justified, directed reinstatement of respondents in service with all the back benefits. The appellants challenged the order of Labour Court in appeals before the Lahore Appellate `tribunal, only on the ground of lack of jurisdiction of Labour Court which failed. The appellants then challenged the decisions of the Labour Court and the Labour Appellate Tribunal in several writ petitions which too were dismissed and against the order of High Court leave to appeal was granted by this Court as aforesaid.
"6. Powers and functions of the Authority.‑‑(1) Subject to the provisions of this Act and any rule framed thereunder, the Authority may exercise such power and take such measures as may be necessary for carrying out the purposes of this Act.
(2) Without prejudice to the generality of the foregoing subjection, the authority may‑‑
(i) prepare, implement and enforce the Lahore Metropolitan Development Plan;
(ii) prepare, implement and enforce the Annual Development Programme for the area;
(iii) prepare, implement and enforce schemes for environmental improvements, housing, urban renewal including slums, clearance and redevelopment, water supply, sewerage, drainage, solid waste disposal, transportation and traffic health and education facilities and preservation of objects or places of historical, archaeological, scientific, cultural and recreational importance;
(iv) take any step or adopt any measures for the face lifting and beautification of the area;
(v) acquire property, both movable and immovable;
(vi) sell, lease, exchange or otherwise dispose of any property vested in it;
(vii) undertake any works and incur any expenditure;
(viii) procure machinery, instruments or any other material required by it; .
(ix) enter into contracts;
(x) cause study, surveys, experiments, technical researches or to contribute towards the cost of any such studies, surveys. experiment technical researches, made by any other Agency;
(xi) issue interim development orders for areas for which a scheme is under preparation and restrict or regulate by general or special order, any change in the use of land and alteration in building structures and installations:
(xii) cause removal of any works obstructing the execution of its schemes; .
(xiii) seek and obtain advice and assistance for the preparation of any scheme or for the execution of any schemes form any Government Agency or person, and such agency or person shall give the advice and assistance sought by the Authority to the best of its ability, knowledge and judgment and the additional expenditure, if any, involved in giving such advice or Assistance shall be borne by the authority. "
Learned Judge in Chambers after considering the above functions performed by‑the L.D.A. came to the following conclusions:
"From the above, it would appear that the Authority is not only empowered to prepare, implement and enforce the Metropolitan Development Plan and Annual Development Programme but also prepare, implement and 'enforce schemes for environmental Improvements. Housing, water supply, sewerage, drainage, solid waste disposal, transportation and traffic health facilities as also sell, lease, exchange and dispose of any property, undertake any work, incur any expenditure. There is no denial that in addition to rendering various services, like sewerage, water supply, drainage, solid waste disposal, the petitioner is also engaged in construction of roads, flats and houses. For the purposes of implementing its schemes, land acquired by the authority is developed by it and a part hereof is sold in form of plots to the general public through auction or negotiations as the case may be. It is thus difficult to accept the contention of the learned counsel for the petitioner that the petitioner is not rendering any service and , is, therefore, not an industry within the meaning of the Industrial Relations Ordinance, IB 1969.
So far as the cases relied upon by the learned counsel for the petitioner are concerned, it may, at the very outset, be noticed that the cases relate to educational institutes which do render any material services and have been held not to be an industry. In the case of Employees' Union, Jamia Karachi and another v. Registrar of Trade Unions, Sindh and 2 others (1981 PLC 403). the Sindh High Court observed that the words 'Industry' and ' service' are capable of various interpretations which may differ according to one's approach, notions, socio‑economic consideration and ideology and that only that services which are material in nature and are outcome of an organized economic activity in continuity with cooperation of workers and management will he treated as industry. After noticing the provisions of the University of Karachi Act. 1972, it was held that as the services, being provided by the University are not material services, therefore, cannot be said to be falling within the definition of industry. Apart from being clearly distinguishable, it may be observed that the ratio laid down therein supports the case of respondent No. l instead of the petitioner as the services being rendered by the Lahore Development Authority are material in nature. "
The learned counsel for the appellants has relied on the following cases in support of his contention that L.D.A. could not be treated as an industry:‑‑‑
(1) K.G. Old, Principal, Christian Technical Training Centre, Gujranwala v. Presiding Officer, Punjab Labour Court PLD 1976 Lahore 1097;
(2) A. F. Ferguson & Co. v. Sindh Labour Court PLD 1985 SC 429;
(3) Employees' Union, Jamia Karachi v. Registrar of Trade Unions, Sindh and 2 others 1981 PLC 403;
(4) Lahore Development Authority (WASA) v. Salah‑ud‑Din 1983 PLC 281;
(5) Government of Balochistan v. Livestock Employees' Union 1993 PLC 13; and
(6) 'An unreported decision dated 7‑10‑1992 (Livestock Employees Union, Agricultural Baildar Employees' Union and Forest Employees and Workers' Union v. Government of Balochistan and others C.P.L.As. Nos. 66‑Q, 67‑Q and 74‑Q of 1992).
" 15. The learned Judges of the High Court declared the registration of appellants as a Trade Union of Workers under the provisions of I.R.O. without lawful authority and of no legal effect mainly on the consideration that Quetta Municipal Corporation was not an industry as defined in the I.R.O. and therefore, its employees (members of appellants) were not covered by the definition of 'worker' or 'workman' given in the I.R.O. The learned Judges in support of their conclusion relied on the case of K.G. Old v. Presiding Officer, Punjab Labour Court, decided by a learned Single Judge of Lahore High Court which was quoted with approval by a learned Division Bench of Sindh High Court in the case of Employees' Union of Jamia Karachi.. According to learned Judges of High Court of Balochistan, both the abovenoted cases were approved by this Court in the case of A.F. Ferguson v. The Sindh Labour Court.
'We observe that after the above judgment was delivered, the Lahore High Court as well as a Bench of the Sindh High Court has dissented from the view taken by the learned Judges that the dictionary meaning was to be given to the words mentioned in clause (xiv) of section 2 of the Ordinance and that its amplitude could not be curtailed by reference to the old definition of the word 'industry'. In K.G. Old v. Presiding Officer, Punjab Labour Court and others PLD 1976 Lah. 1097 Mr. Justice Shafiur Rahman (now a Judge of this Court) in an exhaustive and detailed judgment, after noticing all the relevant case‑law including the judgment in the. `' present case, took the view that the use .of the expressions 'Business, Trade, Manufacture, Calling. Service, Employment or Occupation' in the definition of industry in Industrial Relations Ordinance is not in its ordinary dictionary meaning but in its popular and conventional meaning'. He went on to add that in the context of industrial and labour laws, these expressions apply to any enterprise which is organised and is systematic depending substantially, if not entirely, on the cooperation between labour and capital, and having. as its object production, distribution, acid consumption of wealth, or the production or provision of material service. In this view the words 'calling, service, employment or occupation' were not to be undrestood or interpreted in their plain dictionary meaning but took their colour from the opening words, namely, Business, Trade and Manufacture and the meaning of these words had to be controlled with' reference to the preceding words in the definition and the objects of the statute. This view was followed by one of us (Nasim Hassan Shah, J.) while sitting in Lahore High Court in Pakistan Central Cotton Committee, Karachi v. Presiding Officer, Punjab Labour Court No.3, Lyallpur etc. (Writ Petition No.74 of 1976). And before us, it was further submitted that the distinction between learned professions on the one hand and business/trade/manufacture, on the other was so fundamental and the concept of the two so utterly inconsistent that the same could not be abolished merely by the use of general words like 'calling, service, employment or occupation'.
Again, a Bench of Sindh High Court consisting of Mr. Justice Zaffar Hussain Mirza (now a Judge of. this Court) and Mr. Justice . Salim Akthar in the case of Employees' Union, Jamia Karachi v. Registrar of Trade Unions, Sindh and others 1981 PLC 403, also appears to have followed the view taken by the Lahore High Court in K. G. Old's case rather than that expressed in the present case so far as the definition of 'industry' is concerned.
We also observe that of the three points raised in this case before the learned Judges of the High Court, namely:
(i) that the appellant firm was not an industry within the meaning of the Ordinance;
(ii) that the respondent No.2 had no locus standi to raise and maintain an industrial dispute as required under the Ordinance; and
(iii) that respondent No.2 was not qualified as a Collective Bargaining Agent. "
The High Court only decided the first point definitively holding that the appellant‑firm did not constitute an industry within the meaning of the Ordinance. However, as regards the second point, though it was held that respondent No.2 had a locus standi to raise the dispute because the appellant‑firm had failed to establish before the High Court that the second respondent's registration as a profession was illegal in view of section 7(2) of the Ordinance but' the appellant firm was allowed to raise this objection before the Labour Court in the light of further evidence, if so advised. However, it entirely refused to entertain and decide the third question, namely, that respondent No.2 was not qualified as Collective Bargaining Agent on the 'ground that this question could not be decided in the Constitutional jurisdiction of the High Court.
"It seems to us that all the points raised above by the parties did require adjudication and as some of them were disputed questions of fact they could only be decided by the Labour Court. Hence, this was a fit case in which all questions falling for determination should have been tried and determined in the first instance by the Labour Court itself. Respondent No.2, indeed, did raise an objection to the effect that, in these circumstances, the Constitutional petition was not competent, but it was overruled and the Constitutional petition was held to be maintainable on the view that the question involved was whether the Labour Court had not usurped jurisdiction in the case and that the said question was of wide public importance. It was, however, overlooked that in so holding its effect would be that while some questions stood determined by the High Court, others would still remain for decision by the Labour Court. In our view, the Constitutional jurisdiction of the High Court should not normally be exercised in cases where the entire case will not be completely disposed of. This Court and even the privy Council, has not favoured piecemeal and fragmentary decisions of causes; see Abdur Rehman v. Haji Mir Ahmed Khan and another PLD1983 SC ~,y 21, Ibrahim v. Muhammad Hussain PLD 1975 SC 457 and Nanhela' and another v. Umrao Singh AIR 1931 PC 33. In the circumstances of the present case the prayer for exercising Constitutional jurisdiction of the High Court should, therefore, have been declined. We are, accordingly, of the opinion that the objection raised by respondent No.2 that the Constitutional petition was premature should have prevailed and the Constitutional petition dismissed on the said ground. The ultimate order passed by the High Court dismissing the Constitutional petition does not, therefore, require any alternation. But this does not imply that we are in agreement with the view taken by it that the appellant‑company constituted an 'industry'. "
We may incidentally mention here that the decision in A.F. Ferguson & Co. was rendered by a Division Bench of High Court of Sindh which consisted of Dorab Patel and Muhammad Haleem, JJ. (as their Lordships then were). Employees' Union, Jamia Karachi's case was also decided by another Bench of Sindh High Court consisting of Zaffar Hussain Mirza (as he then was) and Saleem Akhtar, JJ. While the case of K.G. Old was decided by Shafiur Rehman, j . (as he then. was) sitting single in the Lahore High Court All the learned Judges who decided the abovementioned three cases were subsequently elevated to this Court and one of them (Saleem Akhtar, J.) is still a Judge of this Court. As this Court neither approved nor disapproved specifically the views expressed in A.F. Ferguson & Co., Employees' Union of Jamia Karachi and K:G. Old they are entitled to the highest considerations. and respect as and when these cases come up for consideration before this Court.
In K.G. Old's case, the learned Single Judge was considering the case of a dismissed employee of an industrial unit (workshop) maintained on commercial basis, by a technical educational institution, which offered courses in woodwork, sheet metal, welding, electrician, job machinist fitter/turner, draughtsman and auto mechanics. It was argued before the learned Single Judge that the persons employed in such an industrial unit shall be deemed to be employed in an 'industry' as defined in the I. R.O. This contention was repelled by the learned Judge in Chambers on the ground that the workshops organised by the institution, though carried on commercial basis, would not fall within the definition of industry as the purpose for which it was established was ancillary to the main purpose of the establishment, namely imparting of technical education to the students. It was further observed by the learned Single Judge, that the enterprise as a whole has to be looked at to find out its raison d'etre, and any yart of it which is incidental ancillary or an adjunct cannot determine the character of the whole'. No such question arises in the appeal before us.
20 In Jamia Karachi's case the question before the High Court of Sindh was whether University of Karachi or the Board of intermediate Education, Karachi was an 'industry' as defined in I.R.O. The learned Judges interpreted the expressions 'industry' and 'service' used in I.R.O. as follows:‑‑
The importance of education can neither be ignored nor denied. Education is designed to guide a man in learning and culture, and mould him towards his eventual role in society. Education through the institutions like schools, colleges and universities is agent of cultural transmission. Culture depends upon continuity, and these institutions help to provide it by transmitting accumulated knowledge and skills and values aid beliefs. Schools, colleges and universities help in building up character and such qualities as honesty, piety, thrift and industriousness. Besides this they impart knowledge of art, philosophy, science, literature and last but not the least the professional expertise to meet the challenge of time and growing expansion in all fields. From the very inception of our society prime emphasis has been on learning and education. The learned people and institutions have ‑ always commanded high esteem, respect and reverence. It is a source of all knowledge and learning where people come to learn and go forth to serve. Education is the fountain head of all inventions, sciences, technology, research, learning and knowledge. The benefit a student gets or the community at large receives from the University is completely different and distinguishable from the benefit of service which provide the community with the use of something such .as hotel, electric power, transportation, mail delivery, etc. The University serves the students intellectually, morally and mentally. The service rendered by the University .entirely depends upon the contribution of the learning research study, knowledge of the men of letter. It is this distinctive character of the University which absolutely distinguish it from institutions providing material service.
.This absence of material nature of service keeps the University gad the Board out of the pale of the word ' Industry' Education is not a service it is a duty. Its acquirement is no longer voluntary but undisputedly it is being made compulsory. The universality and cosmopolitan nature of education keeps it completely, distinct and distinguished from material service. Education is of such universal importance that in all countries, the Government have owned it as their obligation and duty towards the people. These considerations in our view are sufficient to draw a line and save it from the sweep of generality".
21 From the above‑quoted passage it is quite clear that the learned Judges in that case reached the conclusion that the 'service' rendered by the University depended solely upon the contribution of learning, research, study, knowledge of the men of letters' which distinguished it from establishments rendering material service, and therefore, a University would not fall within the definition of Industry as defined in the I.R.O. According to learned Judges the rendering of a service by an establishment which is material in nature is a determinate factor to cover such an establishment within the definition of 'Industry' under the I.R.O. The expression 'material service' came up for consideration before the Indian Supreme Court in the case of Bangalore Water Supply v. A. Rajappa AIR 1978 SC 548, in a case arising under Indian Industrial Disputes Act (1947), which defined the word 'industry' in section 2(j) as follows:‑‑
" 'Industry' means any business, trade, undertaking, manufacture or calling of employers and includes any calling, service, employment, handicraft, or industrial occupation or avocation of workmen."
And after an exhaustive survey of case‑law the learned Judges of Indian Supreme Court made these observations while disagreeing with the earlier view of that Court expressed in the case of Safdar Jung Hospital v. Kuldip Singh Sethi AIR 1970 SC 1407):
"156. With the greatest respect to the learned Chief Justice, the arguments strung together in this paragraph are too numerous and subtle for us to imbibe. It is transcendental to define material services as excluding professional services. We have explained this position at some length elsewhere in this judgment and do not feel the need to repeat. Nor are we convinced that Gymkhana AIR 1968 SC 554 and Cricket Club of India AIR 1969 SC 276 are correctly decided. The learned Judge placed accent on the non‑profit‑making members club as being outside the pale of trade or industry. We demur to this proposition.
'If a hospital, nursing home or a dispensary is run as a business in a commercial way, there may be found elements of an industry there'. This facet suggests either profit motive, which has been expressly negatived in the very case, or commercial‑type of activity, regardless of profit, which affirms the test which we have accepted, namely, that there must be employer‑employee relations more or less on the pattern of trade or business. All that we can say is that there are different strands of reasoning in the judgment which are somewhat difficult to reconcile. Of course, when the learned Judge states that the use of the First Schedule to the Act depends on the condition precedent of the existence of an industry, we agree. But, that by itself does not mean that a hospital cannot be regarded as an industry, profit or no profit, research or no research. We have adduced enough reasoning in the various portions of this judgment to regard hospitals, research institutions and training centres as valuable material services to the community, qualifying for coming within section 2Q). We must plainly state that vis‑a‑vis hospitals, Safdarjung AIR 1970 SC 1407 was wrong and Hospital Mazdoor Sabha 'was right. "
22 Bengalore Water Supply case (supra) specifically overruled Safdarjung case AIR 1970 SC 1407, Solicitors' case AIR 1962 SC 1080, Gymkhana case AIR 1968 SC 554, Delhi University case AIR 1963 SC 1873, Dhanrajgirji Hospital case AIR 1975 SC 2032. Some of these cases were specifically referred quid relied in the judgments rendered in the cases of K.G. Old and Jamia Karachi. In the final analysis the learned Judges of Indian Supreme Court interpreted the word 'Industry' in Bangalore Water Supply case (supra) as follows:‑‑
"161. 'Industry', as defined in section 2(j) and explained in Banerji AIR 1953 SC 58 has a wide import:
(a) Where (i) systematic activity, (ii) organised. by cooperation between employer and employee (the direct and substantial element is chimerical), (iii) for the production and/or distribution of goods and services calculated to satisfy human wants and wishes (not spiritual or religious but inclusive of material things or services geared to celestial bliss i.e. making, on large scale prasad or food) prima facie, there is an industry in that enterprise.
(b) Absence of profit motive or gainful objective is irrelevant, be the venture in the public, joint, private or other sector.
(c) The true focus is functional and the decisive test in the nature of the activity with special emphasis on the employer‑employee relations.
(d) If the organisation is a trade or business it does not cease to be one because of philanthropy animating the undertaking.
II. Although section 2(j) uses words of the widest amplitude in its two limbs, their meaning cannot be magnified to overreach itself:
(a) 'Undertaking' must suffer a contextual and associational shrinkage $s explained in Banerji and in this judgment; so also, service, calling and the like. This yield the inference that all organized activity possessing the triple elements in I (supra), although not trade or business, may still be 'industry' provided the n.‑tore of the activity, viz. the employer‑employee basis, bears resemblance to what we find in trade or business. This takes into the fold 'industry' undertakings, calling and services, adventures analogous to the carrying on of trade or business'. All features, other than the methodology of carrying on the activity viz. in organizing the cooperation between employer and employee, may be dissimilar. It does not matter, if on the employment terms there is analogy.
III. Application of these guidelines should not stop short of their logical reach by invocation of creeds, cults or inner sense of incongruity or outer sense of motivation for or resultant of the economic operations. The ideology of the Act being industrial peace, regulation and resolution of industrial disputes between employer and workmen, the range of this statutory ideology must inform the reach of the statutory definition. Nothing less, nothing more:
(a) The consequences are (i) professions, (ii), clubs, (iii) educational institutions, (iv) cooperatives, (v) research institutes, (vi) charitable projects, and (vii) other kindred adventures, if they fulfil the triple tests listed in I (supra), cannot be exempted from the scope of section 2(j).
(b) A restricted category of professions, clubs, cooperatives and even gurukulas and little research labs, may qualify for exemption if, in simple ventures, substantially and, going by the dominant nature criterion, substantively, no employees are entertained but in minimal matters, marginal employees are hired without destroying the non‑employee character of the unit.
(c) If, in a pious or altruistic mission many employ themselves, free or for small honoraria or like return, mainly drawn by sharing in the purpose or cause, such as lawyers volunteering to run a free legal services clinic or doctors serving in their spare hours in a free medical centre or ashramites working at the bidding of the holiness, divinity or like central personality, and the services are supplied free or at nominal cost and those who serve are not engaged for remuneration or on the basis of master and servant relationship, then, the institution is not an industry even if stray servants, manual or technical, are hired. Such eleemosynary or like undertakings alone are exempt not other generosity, compassion, developmental passion or project.
(IV). The dominant nature test:
(a) Where a complex of activities, some of which qualify for exemption, others not, involves employees on the total undertaking, some of whom are not 'workmen' as in the University of Delhi case AIR 1963 SC 1873 or some departments are not productive of goods and services if isolated, even then, the predominant nature of the services and the integrated nature of the departments as explained in the Corporation of Nagpur AIR 1960 SC 675 will be the true test.
The whole undertaking will be 'industry' although those who are not 'workmen' by definition may not benefit by the status.
(b) Notwithstanding the previous clauses, sovereign functions, strictly understood (alone) qualify for exemption, not the welfare activities or economic adventures undertaken by Government or statutory bodies.
(c) Even in departments discharging sovereign functions, if there are units which are industries and they are substantially severable, then they can be considered to come within section 2(j).
(d) Constitutional and competently enacted legislative provisions may well remove from the scope of the Act categories which otherwise may be covered thereby.
V. We ovrrule Safdarjung AIR 1970 SC 1407, Solicitors' case AIR 1962 SC 1080, Gymkhana AIR 1968 SC 554, Delhi University case AIR 1963 SC 1373, Dhanrajgirji Hospital case AIR 1975 SC 2032 and other rulings whose ratio runs counter to the principles enunciated above, and Hospital Mazdoor Sabha AIR 1960 SC 610 is hereby rehabilitated. " , 23. It may be‑mentioned here that view expressed in the case of Banerji AIR 1953 SC 58 by the Indian Supreme Court which was carried forward in Hospital Mazdoor Sabha AIR 1960 SC 610 and Nagpur Corporation AIR 1960 SC 675 did not meet with approval in the Safdarjung (supra). However, with the decision in Bangalore Water Supply case (supra) the Indian Supreme Court once again reaffirmed the view expressed in Banerji, Hospital Mazdoor Sabha and Nagpur Corporation (supra) as correct. In Nagpur Corporation' case, the Supreme Court of India addressed the question whether functions of Nagpur Corporation fall within the ambit of definition of Industry. as defined in the Indian Industrial Disputes Act (1947) and concluded as follows:‑‑
"(17). The. result of the discussion may be summarized thus: (1) The definition of 'industry' in the Act is very comprehensive. It is in two parts: one part defines it from the standpoint of the employer and the other from the standpoint of the employee. If an activity falls under either part of the definition, it will be an industry within the meaning of the Act. (2) The history of industrial disputes and the legislation recognizes the basic concept that the activity shall be an organised one and not that which, pertains to private or personal employment. (3) The regal functions described as primary and inalienable functions of State though ‑ statutorily delegated to a corporation are necessarily excluded from the purview of the definition. Such regal functions shall be confined to legislative power. (4) If a service rendered by an individual or a private person would be an industry, it would equally be an industry in the hands of a corporation. (5) If a service rendered by a corporation is an industry, the employees in the departments connected with the service, whether financial, administrative or executive, would be entitled to the benefits of the Act. (6) If a department of a municipality discharges many functions, some pertaining to industry as defined in the Act and other non‑industrial activities, the predominant functions of the department shall be the criterion for the purposes of the Act."
The I.R.O. is basically beneficial legislation which provide for protection of the rights of labour classes. Its object amongst other is to ameliorate the conditions of workers. Such a legislation has to be construed liberally and beneficially. A restricted constructure of the provisions of the I.R.O: would defect the manifest objective of the legislation. Keeping in view the beneficial nature of the statute I am inclined to hold that except for those functions of Quetta Municipal Corporation which may fall within the ambit of its regal functions its other functions, such as rendering civic services etc. would be covered by the expression 'services' used in the definition of word 'Industry' under the I.R.O. I am unable to subscribe to the view taken by the learned Judges of High Court that on account of omission of the word 'undertaking' from the definition of 'Industry' in the I.R.O., the Municipal Corporation would not he covered by the definition of 'Industry' as it stands now in the I.R.O. In my humble view the omission of word 'undertaking' from the definition of 'Industry' in the I.R.O. made no difference as the ‑'service' continue to remain a part of the definition of 'Industry' I, therefore, respectfully feel inclined to agree, Nth the interpretation of word 'Industry' by the Indian Supreme Court in the case of Nagpur Corporation and Bangalore Water Supply "
In view of ,the above‑stated legal position, we are of the view that the conclusion reached by the learned Single Judge in the above cases that the C appellants fall within the meaning of an 'industry' is not open to any exception. No other point was raised. No case for interference with the judgment of High Court is made out. The appeals are, accordingly, dismissed. However, as majority of respondents has not appeared and defended the case; there will be: no order as to costs:
M.B.A./L‑18/S , Appeals dismissed.
?L D 2000 S C 225
[Shariat Appellate Jurisdiction]
Present: Justice Khalil‑ur‑Rehman Khan, Chairman, Justice Munir A. Sheikh, Justice Wajihuddin Ahmed and Justice Maulana Muhammad Taqi Usmani, Members
Civil Shariat Appeal No. l of 1992
Dr. M. ASLAM KHAKI‑‑‑Appellant
versus
Syed MUHAMMAD HASHIM and 2 others‑‑‑Respondents
Civil Shariat Appeal No.2 of 1992
THE AGRICULTURAL DEVELOPMENT BANK OF PAKISTAN, ISLAMABAD‑‑‑Appellant
versus
FEDERAL GOVERNMENT OF PAKISTAN
through Secretary, Ministry of Finance, Islamabad and 53 others‑‑‑Respondents
Civil Shariat Anneal No.3 of 1992
THE MANAGER, ALLIED.BANK LIMITED, B/O BAGHBANPURA, LAHORE and 2 others‑‑‑Appellants
versus
Malik MUNIR AHMED and 2 others‑‑‑Respondents
Civil Shariat Appeal No.4 of 1992
ALLIED BANK OF PAKISTAN LIMITED‑‑‑Appellant
versus
NAVEED ASIF and another‑‑‑Respondents
Civil Shariat Appeal No.5 of 1992
ALLIED BANK OF PAKISTAN LIMITED‑‑‑Appellant
versus
NAVEED ASIF and another‑‑‑Respondents
Civil Shariat Appeal No.6 of 1992 '
ALLIED BANK OF PAKISTAN LIMITED‑‑‑Appellant
versus
NAVEED ASIF and another‑‑‑Respondent
Civil Shariat Appeal No.7 of 1992
ALLIED BANK OF PAKISTAN LIMITED‑‑‑Appellant
versus
NAVEED ASIF and another‑‑‑Respondents
Civil Shariat Appeal No.8 of 1992
ALLIED BANK OF PAKISTAN LIMITED
through President, Head Office, Jubilee Insurance House, Karachi‑‑‑Appellant
versus
NOOR AHMED and another‑‑‑Respondents
Civil Shariat Appeal No.9 of 1992
ALLIED BANK OF PAKISTAN LIMITED
through President, Head Office, Jubilee Insurance House, Karachi ‑‑‑ Appellant
versus
FEDERATION OF PAKISTAN through Secretary, Ministry of Finance, Government of Pakistan, Islamabad‑‑‑Respondent
Civil Shariat Appeal No. 10 of 1992
ALLIED BANK OF PAKISTAN LIMITED‑‑‑Appellant
versus
GOVERNMENT OF PUNJAB
through Secretary, Finance Department, Government of Punjab, Lahore and 4 others‑‑‑Respondents
Civil Shariat Appeal No. l l of 1992
UNITED BANK LIMITED‑‑‑Appellant
versus
Messrs FAROOQ BROTHERS
through Sole Proprietor Zafar Alam Chaudhry and 5 others‑‑‑Respondents
Civil Shariat Appeal No. 12 of 1992
UNITED BANK LIMITED‑‑‑Appellant
versus
Chaudhry SHARIF AHMED and another‑‑‑Respondents
Civil Shariat Appeal No. 13 of 1992
UNITED BANK LIMITED‑‑‑Appellant
versus
MUHAMMAD AMIN and another‑‑‑Respondents
Civil Shariat Appeal No. 14 of 1992
UNITED BANK LIMITED‑‑‑Appellant
versus
Messrs KAMRAN ICE FACTORY and 5 others‑‑‑‑Respondents
Civil Shariat Appeal No. 15 of 1992
UNITED BANK LIMITED‑‑‑Appellant
versus
MUHAMMAD IQBAL ZAHID and 3 others‑‑‑Respondents
Civil Shariat Appeal No. 16 of 1992
UNITED BANK LIMITED‑‑‑Appellant
versus
Messrs HAJISONS ANGOLO CINEMA
through Ch.Talib Hussain, Managing Partner and 8 others‑ ‑‑Respondents
Civil Shariat Appeal No. 17 of 1992
UNITED BANK LIMITED‑‑‑Appellant
versus
ABDUL QAYYUM QURESHI and another‑‑‑Respondents
Civil Shariat Appeal No. 18 of 1992
UNITED BANK LIMITED‑‑‑Appellant
versus
ABDUL RASHID and 2 others‑‑‑Respondents
Civil Shariat Appeal No. 19 of 1992
UNITED BANK LIMITED‑‑‑Appellant
versus
Shaikh MASOOD ELLAHI and another‑‑‑Respondents
Civil Shariat Appeal No.20 of 1992
MUSLIM COMMERCIAL BANK‑‑‑Appellant
versus
ALLIED PAPER INDUSTRIES LTD. and 8 others‑‑‑Respondents
Civil Shariat Appeal No.21 of 1992
NATIONAL BANK OF PAKISTAN‑‑‑Appellant
versus
ALLIED PAPER INDUSTRIES LTD. and 13 others‑‑‑Respondents
Civil Shariat Anneal No.22 of 1992
NATIONAL BANK OF PAKISTAN‑‑‑Appellant
versus
ALLIED PAPER INDUSTRIES LTD. and 8 others‑‑‑Respondents
Civil Shariat Appeal No.23 of 1992
NATIONAL BANK OF PAKISTAN‑‑‑Appellant
versus
ALLIED PAPER INDUSTRIES LTD and 8 others‑‑‑Respondents
Civil Shariat Appeal No.36 of 1992
Messrs HABIB BANK LIMITED‑‑‑Appellant
versus
Syed MUSHARAF ALAM and 4 others‑‑‑Respondents
Civil Shariat Appeal No.37 of 1992
Messrs HABIB BANK LIMITIED‑‑‑Appellant
versus
FAIZ AHMAD and 11 others‑‑‑Respondents
Civil Shariat Appeal No.38 of 1992
Messrs HABIB BANK LIMITED‑‑‑Appellant
versus
Messrs KASHMIR FABRICS
through Haji Sh.Karamat Ali, Managing Partner and 2 others‑‑‑Respondents
Civil Shariat Appeal No.39 of 1992
Messrs HABIB BANK LIMITED‑‑‑Appellant
versus
FAIZ AHMAD and 11 others‑‑‑Respondents .
Civil Shariat Appeal No.40 of 1992
Messrs HABIB BANK LIMITED‑‑‑Appellant
versus
FAIZ AHMAD and 11 others‑‑‑Respondents
Civil Shariat Appeal No. 41 of 1992
Messrs HABIB BANK LIMITED‑‑‑Appellant
versus
FAIZ AHMAD and 11 others‑‑‑Respondents
Civil Shariat Appeal No.42 of 1992
NATIONAL BANK OF PAKISTAN‑‑‑Appellant
versus
Messrs ALCOS (PAK), LAHORE and 2 others‑ ‑‑Respondents
Civil Shariat Appeal No.43 of 1992
NATIONAL BANK OF PAKISTAN‑‑‑Appellant
versus
Messrs ALCOS (PAK), LAHORE and 2 others‑‑‑Respondents
Civil Shariat Appeal No.44 of 1992
NATIONAL BANK OF PAKISTAN‑‑‑Appellant
versus
Messrs ALCOS (PAK), LAHORE and 2 others‑‑‑Respondents
Civil Shariat Appeal No.45 of 1992 .
NATIONAL BANK OF PAKISTAN‑‑‑Appellant
versus
Messrs ALCOS (PAK), LAHORE and 2 others‑‑‑Respondents
Civil Shariat Appeal No.46 of 1992
NATIONAL BANK OF PAKISTAN‑‑‑Appellant
versus
Messrs M.A.QURESHI & SONS
through Proprietor Muhammad Ashraf and 2 others‑‑‑Respondents
Civil Shariat Appeal No.47.of 1992
NATIONAL BANK OF PAKISTAN‑‑‑Appellant
versus
Messrs M.A.QURESHI & SONS
through Proprietor Muhammad Ashraf and 2 others‑‑‑Respondents
Civil Shariat Appeal No.48 of 1992
NATIONAL BANK OF PAKISTAN‑‑‑Appellant
versus
Messrs M.A.QURESHI & SONS through Proprietor
Muhammad Ashraf and 2 others‑‑‑Respondents
Civil Shariat Appeal No.49 of 1992
NATIONAL BANK OF PAKISTAN‑‑‑Appellant
versus
Messrs M.A.QURESHI & SONS
through Proprietor Muhammad Ashraf and 2 others‑‑‑Respondents
Civil Shariat Appeal No.50 of 1992
NATIONAL BANK OF PAKISTAN‑‑‑Appellant
versus
ALLIED PAPER INDUSTRIES LTD. and 11 others‑‑‑Respondents
Civil Shariat Appeal No.51 of 1992
NATIONAL BANK OF PAKISTAN‑‑‑Appellant.
Versus
MUHAMMAD HASHIM ‑‑‑ Respondent
Civil Shariat Appeal No.52 of 1992 .
NATIONAL BANK OF PAKISTAN‑‑‑Appellant , versus
MUHAMMAD HASH IM ‑Respondent
Civil Shariat Appeal No.53 of 1992
NATIONAL BANK OF PAKISTAN‑‑‑Appellant
versus
Mian SALEEMUDDIN and 4 others‑‑‑Respondents
Civil Shariat Appeal No.54 of 1992
Messrs ABN AMRO BANK through Authorised Officer and 19 others‑‑‑Appellants
versus
The FEDERATION OF PAKISTAN through the Secretary, Ministry of Finance, Islamabad and 4 others‑‑‑Respondents
Civil Shariat Appeal No.55 of 1992
NATIONAL BANK OF PAKISTAN‑‑‑Appellant
versus
ALLIED PAPER INDUSTRIES LTD. and 7 others‑‑‑Respondents
Civil Shariat Appeal No.56 of 1992
NATIONAL BANK OF PAKISTAN‑‑‑Appellant
versus
ALLIED PAPER INDUSTRIES LTD. and 8 others‑‑‑Respondents
Civil Shariat Appeal No.57 of 1992
NATIONAL BANK OF PAKISTAN‑‑‑Appellant
versus
ALLIED PAPER INDUSTRIES LTD. and 11 others‑‑‑Respondents
Civil Shariat Appeal No.58 of 1992
NATIONAL BANK OF PAKISTAN‑‑‑Appellant
versus
ALLIED PAPER INDUSTRIES LTD. and 11 others‑‑‑Respondents
Civil Shariat Appeal No.73 of 1992
FEDERATION OF PAKISTAN‑‑‑Appellant
versus
Dr. MAHMOOD‑UR‑REHMAN FAISAL ‑‑‑Respondent
Civil Shariat Appeal No.96 of 1992
PROVINCE OF PUNJAB
through Secretary Cooperative, Government of Punjab, Lahore and another‑‑‑Appellants
versus
Ch. SARWAR HAYAT and another‑‑‑Respondents .
Civil Shariat Appeal No.97 of 1992
PROVINCE OF PUNJAB
through Secretary Cooperative Government of Punjab, Lahore and 2 others‑‑‑Appellants
versus
Mst. MUMTAZ BEGUM and another‑‑‑Respondents
Civil Shariat Appeal No.98 of 1992
PROVINCE OF PUNJAB
through Secretary Cooperative, Government of Punjab, Lahore and another‑‑‑Appellants
versus
GULZAR AHMAD KHAN, SENATOR and another‑‑‑Respondents
Civil Shariat Appeal No.99 of 1992
PROVINCE OF PUNJAB
through Secretary Cooperative, Government of Punjab, Lahore and another‑‑‑Appellants
versus
GULZAR AHMAD KHAN, SENATOR and another‑‑‑Respondents
Civil Shariat Appeal No. 100 of 1992
PROVINCE OF PUNJAB
through Secretary Cooperative, Government of Punjab, Lahore and another‑‑‑Appellants
versus
GULZAR AHMAD KHAN, SENATOR and another‑‑‑Respondents
Civil Shariat Appeal No. 101 of 1992
PROVINCE OF PUNJAB
through Secretary Cooperative, Government of Punjab, Lahore and another‑‑‑Appellants
versus
Ch. SARWAR HAYAT and another‑‑‑Respondents
Civil Shariat Appeal No. 102 of 1992, , PROVINCE OF PUNJAB
through Secretary Cooperative, Government of Punjab, Lahore and another‑‑‑Appellants
versus
Ch. SARWAR HAYAT and another‑‑‑Respondents
Civil Shariat Appeals Nos. l to 23. 36 to 58,73 and 91 of 1992
(On appeal from the judgment of Federal Shariat Court dated 14‑11‑1991 passed in Shariat Petitions Nos. 42‑1 + 45‑I/91, 14‑I/90, 42‑L/91, 67‑L/91, 74‑L/91, 69‑L/91, 68‑L/91, 28‑L/91, Suo Motu Case No.3‑I/91, Shariat Petitions Nos.4‑I/91, 30‑L/91, 31‑L/91, 32‑L/91, 17?L/91, 18‑L/91, 49‑L/91, 73‑I/91, 76‑L/91, 89‑L/91, 30‑1/90, 17‑A/I/91, 16?C/I/91, 16‑A/I/91, 21‑L/90, 29‑L/91, 26‑L/91, 31‑1/91, 32‑t/91, 33‑I/91, 70‑L/91, 71‑L/91, 72‑L/91, 73‑L/91, 27‑L/90 (in four cases), 16‑1/91, 42?1/91, 45‑1/91, 73‑1/90, 72‑L/91, 17‑1/91, 16‑B/I/91, 17‑B/I/91, 17‑C/I/91, 30‑1/90 and 16‑I/90 respectively).
Shariat Appeals Nos. 96 of 1992. 99 of 1992.
100 of 1992 and 101 of 1992
(On appeal from the judgment of Federal Shariat Court dated 22‑6?1992 passed in Shariat Petitions Nos.84‑1/91, 78‑1/91, 79‑1/91 and 83‑I/91 respectively).
Civil Shariat Appeals Nos. 97 of 1992, 98 of 1992 and 102 of 1992
(On appeal from the judgment of Federal Shariat Court dated 30‑6?1992 passed in Shariat Petitions Nos.l‑I/92, 80‑I/91 and 82‑I/91 respectively).
(a) Islamic Jurisprudence‑
‑‑‑‑ Riba‑‑‑Kinds‑‑‑Any amount, big or small, over the principal, in a contract of loan or debt is Riba prohibited by Holy Qur'an, regardless of whether the loan is taken for the purpose of consumption or for some production activity‑ "Riba‑al‑Sunnah" and "Riba‑al‑Qur'an" are types of transactions termed as "Ribs" in Islamic Fiqh based on the Holy Qur'an and Sunnah.
Any amount, big or small, over the principal, in a contract of loan or debt is "Riba" prohibited by the Holy Qur'an, regardless of whether the loan is taken for the purpose of consumption or for some production activity. The 'Holy Prophet (p.b.u.h.) has also termed the following transactions as Riba:
(i) A transaction of money for money of the same denomination where the quality on both sides is not equal, either in a spot transaction or in a transaction based on deferred payment.
(ii) A barter transaction between two weighable or measurable commodities of the same kind, where the quantity on both sides is not equal, or where the delivery from any one side is deferred.
(iii) A barter transaction between two different weighable or measurable commodities where delivery from one side is deferred.
These three categories are termed in the Islamic Jurisprudence as Riba‑al‑Sunnah because their prohibition is established by the Sunnah of the Holy Prophet (p.b.u.h.). Alongwith the Riba‑al‑Qur'an, these are four types of transactions termed as `Riba' in the literature of Islamic Fiqha based on the Holy Qur'an and Sunnah.
Out of these four transactions, the last two ones, mentioned above as (ii) and (iii) have not much relevance to the context of modern business, the barter business being a rare phenomenon in the modern trade. However, the Riba‑al‑Qur'an and transaction of money mentioned above as (i) are more relevant to modern business.
(b) Islamic Jurisprudence‑‑‑
‑‑‑‑Riba‑‑‑Loan‑‑‑No difference between types of loan, so far as the prohibition of Riba is concerned‑‑‑All the prevailing forms of interest, either in the banking transactions or in private transactions do fall within the definition of Riba‑‑‑Any interest stipulated in the Government borrowings, acquired from domestic or foreign sources, is Riba and prohibited by the Holy Qur'an‑‑‑Present financial system, based on interest, being against the Injunctions of Islam as laid down by the Holy Qur'an and Sunnah, and in order to bring the system in conformity with Shariah, Shariat Appellate Bench of Supreme Court directed that the system had to be subjected to radical changes‑‑‑Alternatives to the present system being available, the transactions of interest could not be allowed to continue for ever on the basis of necessity.
There is no difference between types of loan, so far as the prohibition of Riba is concerned. It also does not make any difference whether the additional amount stipulated over the principal loan or debt is small or large. Therefore, all the prevailing forms of interest, either in the banking transactions or in private transactions do fall within the definition of Riba. Similarly, any interest stipulated in the Government borrowings, acquired from domestic or foreign sources, is Riba and clearly prohibited by the Holy Qur'ar.
The present financial system, based on interest, is against the Injunctions of Islam as laid down by the Holy Qur'an and Sunnah, and in order to bring it in conformity with Shariah, it has to be subjected to radical changes.
A variety of Islamic modes of financing has been developed by Islamic scholars, economists and bankers that may' serve as a better alternative to interest. These modes are being practised by about 200 Islamic financial institutions in different parts of the world.
These alternatives being available, the transactions of interest cannot be allowed to continue for ever on the basis of necessity.
There is ample evidence to prove that quite a substantial ground work has been done to suggest strategy for the transformation of the existing financial system to the Islamic one, and the present interest based system need not be retained for an indefinite period on the basis of necessity. However, the transformation may take some time which can be allowed on that basis.
(c) Interest Act (XXXII of 1839)‑‑‑
‑‑‑‑Preamble‑‑‑Constitution of Pakistan (1973), Art.203‑F‑‑‑Repugnancy to Injunctions of Islam‑‑‑Undefined, naked and generalised power to allow interest on a debt, as provided in Interest Act, 1839, being repugnant Injunctions of Islam, Shariat Bench of Supreme Court directed the repeal of Interest Act, 1839 and declared that the Act shall cease to have effect from 31st March, 2000.
The Interest Act, 1839, confers power on the Court to allow interest to the creditor upon all debts or ascertained sum payable which the Court gets recovered. The Council of Islamic Ideology had recommended its repeal in its Session held on 11th November. 1981.
The question of allowing interest by the Court while granting decree has been exhaustively dealt with by the Negotiable Instruments Act, 1881 and the Civil Procedure Code, 1908 as amended from time to time and as such there is no need to retain the Interest Act. 1839 on the Statute Book, so the same, for this reason alone, needs to be repealed. Even otherwise an undefined, naked and generalized power to allow interest on a debt is repugnant to Injunctions of Islam, therefore. Interest Act, 1839 being repugnant to Injunctions of Islam was directed to he repealed.
(d) Government Savings Banks Act (V of 1873)‑‑‑
‑‑‑‑S. 10‑‑‑Constitution of Pakistan (1973), Art.203‑F‑‑‑Repugnancy to Injunctions of Islam‑‑‑Provision of S.10, Government Savings Banks Act, 1873 on account ‑of the use of the word "interest" which was payable along with the amount of deposit was repugnant to Injunctions of Islam‑‑‑If the accrual was caused through permissible mode of investment, no objection could be taken, for the emphasis had to be on adoption of Islamic modes of finance and conduct of business following Islamic principles‑‑?Word "interest" appearing in S.10 of the Government Savings Banks Act, 1873 being repugnant to the Injunctions of Islam, Shariat Bench of Supreme Court directed that word "interest" be substituted with the words "Shariah compliant return" and declared that the provision shall cease to have effect from 30th June, 2001.
The Government Savings Banks Act, 1873 provides for nomination and payment of deposit on death of the depositor and such payment to be a full discharge. However, it provides for the savings of rights of executor and creditor etc.
Section 10, as challenged, reads as under:‑‑‑
"Any deposit made by, or on behalf of, any minor may be paid to him personally if he made the deposit, or to his guardian for his use if the deposit was made by any person other than the minor, together with the interest accrued thereon."
The provision, on account of the use of the word "interest" which is payable alongwith the amount of deposit was repugnant to Injunctions of Islam. If the accrual is caused through permissible mode of investment, obviously no objection can be taken. The emphasis should be on adoption of Islamic modes of Finance and conduct of business following Islamic principles. The word `interest' appearing in section 10 of the Act being repugnant to the Injunctions of Islam was directed to be substituted with the words 'Shariah compliant return'.
(e) Negotiable Instruments Act (XXVI of 1881)‑‑
‑‑‑‑Ss. 79 & 80‑‑‑Constitution of Pakistan (1973), Art,203‑F‑‑‑Repugnancy to Injunctions of Islam‑‑‑Whole of Ss.79 & 80, Negotiable Instruments Act, 1881 are repugnant to the Injunctions of Islam‑‑‑"Mark‑up" system as in vogue in Banks in Pakistan was though repugnant to the Injunctions of Islam, yet transaction of Murabaha or Bai Mu'ajjal in itself was not prohibited‑‑‑If the transaction fulfilled the specified conditions, same could not be held to be repugnant to Injunctions of Islam ‑‑‑Shariat Appellate Bench of Supreme Court declared that the provision will cease to have effect from 30th June, 2001‑‑‑Reasons and principles elucidated with illustrations.
Even though the transactions of mark‑up, leasing, hire‑purchase, service charges and Musharakah are permissible subject to certain conditions, yet the way a further `return' on the pronote or a bill of exchange is provided in section 79, which contemplates a return over a debt is nothing but interest. Section 79 of the Negotiable Instruments Act, 1881, therefore, is repugnant to the Injunctions of Islam in its entirety. Although clause (ii) of the proviso of section 79 speaks of a Musharakah and a profit and loss sharing; this type of transaction does not normally require a promissory note or a bill of exchange, because the rate bf return in a Musharakah is unknown, and the pronote and a bill of exchange are basically designed for a specific amount payable by the debtor. Therefore, retention of this truncated clause will make it applicable to a' situation about which it has been held that no further return is permissible in that situation. So far the amount of profit deserved by the financier remains in the business of the client, a further return on the basis of actual profits accrued to the business will be deserved by the financier, but the provisions of the agreement of Musharaka can take care of it, its mention in the present context is not called for. The whole of section 79 is, therefore, repugnant to the Injunctions of Islam.
Like section 79 the whole of section 80 is repugnant to the Injunctions of Islam.
Following conditions are prescribed for the validity of Murabaha/Bai' Mu'ajjal:‑‑
(i) The time of payment of consideration must be known; and
(ii) the seller has to possess the commodity involved before it is delivered to the purchaser.
The system of mark‑up adopted in Pakistan in January, 1981 did not conform to the standard stipulations of Bai' Mu'ajjal. Bai' Mu'ajjal/Murabaha is one of the most popularly used modes of financing used by the Islamic Banks in the world.
Murabaha mode of Finance or the "mark‑up" system with the conditions attached thereto is permissible mode of Islamic finance and this mode cannot, therefore, be held to be repugnant to the Injunctions of Islam if the conditions prescribed are not being practised by some of the parties. Such violations occurred as there was no monitoring system in existence to check such errors, omissions arid commissions and violations. In the system proposed to be adopted with Shariah Board in existence in the State Bank of Pakistan as well as in the financial institutions themselves, such violations as and when noticed shall be pointed out and eradicated. Moreover, such errors will he eliminated where the system as a whole will be geared up to enforce Islamic Laws with commitment and dedication.
The adoption of the mark‑up system within the limits prescribed appears to be the need of the economic system in the transitional period and till the time more and adequate number of Shariah‑compliant financing modes are developed.
Any return on a promissory note or a bill of exchange as contemplated in subsections (a) and (b) of section 79 of the Negotiable instruments Act of 1881 is Riba and unlawful according to Shariah. Both these subsections are, therefore, held to be repugnant to the Injunctions of Islam as laid down in the Holy Qur'an and Sunnah.
Clause (i) to the proviso to section 79, Negotiable Instruments Act, 1881 specifies different ways to calculate a return on a promissory note or a bill of exchange where they are based on mark‑up, leasing, hire‑purchase or service charges.
A careful reading of section 79 of the Negotiable Instruments Act, 1881 with all its provisions, analysed in the correct context, would show that purpose of section 79 is not to validate or invalidate a certain return in the transactions of mark‑up, leasing etc. The basic purpose of clause (i) is that once a promissory note or a bill' of exchange is drawn on the basis of these transactions, and the issuer of the note or of the bill could not pay their amount on the date of their maturity, the Court may order a certain return in favour of the holder of the note or the bill for the period in which the amount remained unpaid after its maturity. Looked at from this perspective, this provision, in its present form is totally against the Injunctions of Islam, regardless of whether or not the transactions underlying the instrument (mark‑up, leasing etc.) are in accordance with Shariah. The reasons are as follows:
Section 79 in the, Act of 1881 was originally designed for the instruments of interest‑bearing loans or debts. The nature of interest is such that it is calculated on daily basis and keeps on increasing for the whole period of non‑payment. On the basis of this principle, section 79 has visualized different situations where the amount of a note or a bill was not paid by the debtor on the stipulated date. Taking for granted that every day from the period of non‑payment must give the creditor an additional amount as interest or return, subsection (a) has provided that if the instrument has specified a certain rate of interest for the original period of loan, the same rate will be applied to the whole period of further non‑payment. Subsection (b) visualizes a situation where no rate of interest was specified in the instrument, either because the original transaction was free from interest, or because the amount of interest was built in the lump sum mentioned in the instrument. In this situation the rate of interest applied after maturity, has been fixed by law as six per cent. per annum.
When, in 1980, the Government announced the elimination of interest and the State Bank of Pakistan allowed some alternative modes of financing including mark‑up, leasing, hire‑purchase and service charge, some amendments were brought in certain laws. It is in this background that the proviso in section 79 was inserted, and the provisions relating to the notes and bills of exchange drawn on the basis of interest were applied to the transactions of mark‑up, leasing etc. in the manner specified in sub‑clauses of the proviso, without having regard to the fact that all these transactions are essentially different from an interest?-based debt and they cannot be subjected to the same rules as govern the interest‑based instruments. Each one of these four transactions has its own peculiarities.
The first transaction mentioned in sub‑clause (i) of the proviso to section 79 of the Act of 1881 is that of mark‑up in price. What is meant by this term is the transaction of Murabaha or `Bai' Mu'ajjal'.
Although the mark‑up system as in vogue in banks in Pakistan is repugnant to the Injunctions of Islam, yet it is not correct to assert that the transaction of Murabaha or Bai' Mu'ajjal in itself is prohibited. If the transaction fulfils the necessary conditions spelled out above, it cannot be held repugnant to the Injunctions of Islam. But the reference of this transaction in this clause, in the context of a return on a promissory note or a bill of exchange is not according to the basic principles of a Murabaha transaction. The reason is that Murabaha or Bai' Mu'ajjal is a transaction of sale effected on the basis of deferred payment. One of the basic conditions of this transaction, like any other sale, is that the price is fixed at the time of the original contract of sale. This price may include a margin of mark‑up (profit) added on the cost incurred by the seller. To determine the amount of mark‑up, the seller they take different factors into consideration, including the deferred payment, but as already explained once the price is fixed, it will be attributable to the commodity and cannot be increased or decreased unilaterally, because as soon as the sale is accomplished, the price of the commodity became a debt payable by the purchaser. If this debt is evidenced by a promissory note or a bill of exchange, it is not different from a note or a bill evidencing a loan, and no return, whatsoever, can be charged over that note or bill, because it will amount to charging interest on the debt.
Sub‑clause (i) of the proviso to section 79 provides that if the purchaser in a Murabaha or Bai' Mu'ajjal transaction did not pay the price, evidenced by a promissory note or a bill of exchange, a further return at the original rate of mark‑up shall be payable by the purchaser for the whole period within which the price remained unpaid after its maturity. For example A purchased a commodity for Rs. 100. B agreed to purchase it from him on a mark‑up of 10%. The commodity is, thus, sold to B for a price of Rs. 110 to be paid after one year, say, on 31st January. A promissory note in the amount of Rs. 110 is signed by B in favour of A. Now, this promissory note is nothing but an instrument evidencing a debt payable by B to A, which includes the original mark‑up allowed by the Shariah. If B doesn't pay Rs. 110 to A on 31st January, sub‑clause (i) of the proviso to section 79 of the Act, 1881 provides that a further return on the same rate of mark‑up i.e. 10% in the above example, shall be payable by B to A for the whole period of non‑payment after 31st January. This provision is repugnant to the Injunctions of Islam, because after the sale price becomes a debt, no return on it can be claimed by the seller from the purchaser. If the purchaser could not pay at the due date because of his poverty, the Qur'anic command is very clear that he should be given more time till he is able to pay. The Holy Qur'an says:
And if he (the debtor) is poor, he must be given respite till he is well‑off. (2:280).
However, if the purchaser has delayed; the payment despite his ability to pay, he may be subjected to different punishments, but it cannot be taken to be a source of further 'return' to the seller on per cent. per annum basis as contemplated in section 79.
'` The words "mark‑up in price" occurring in sub‑clause (i) of the proviso of section 79 are repugnant to the Injunctions of Islam, but not because the transaction of mark‑up in itself is impermissible, but because after a sale is effected on the basis of mark‑up, and the price is evidenced by a promissory note or a bill of exchange, including the original mark‑up, no further return on the note or the bill is permissible in Sharjah on the basis of the original mark‑up.
The second transaction mentioned in sub‑clause (i) of the proviso to section 79 of the Act is lease. Let us take a concrete example: A has leased an equipment to B on 1st February, 1999 for a period of five years. The aggregate amount of rent agreed between the parties is Rs. 1,00,000 to be paid in monthly instalments. B has signed a promissory note in the sum of Rs. 1,00.000 to be paid on 31st January, 2004. While fixing the rental, the lessor had amortized the cost of the equipment alongwith a margin of his profit at the rate of 5 % per annum. If B does not pay the full amount of Rs.1,00,000 up to 31st January, 2004, the sub‑clause (i) provides that A will be entitled to claim further return on the promissory note at the same rate of 5 % per annum that was taken into account while fixing the original rental, and thus, the debt will keep on increasing, on daily basis until he pays off the full amount.
The correct position according to Shariah is that once the lessee has enjoyed the usufruct of the leased asset for the period of lease, the amount of rent has become a debt due on him and it will be subject to all the rules relevant to a loan or debt, and as mentioned in the case of mark‑up, if the lessee is unable to pay on account of his poverty, he will have to be given further time according to the clear Qur'anic command, and if he is purposely delaying the payment, he will be subjected to punitive steps. But his delay will not be taken as an automatic source of return to the lessor, as contemplated in sub‑clause (i).
If the lessee neither pays rent nor delivers the asset back to the lessor and keeps it in his possession even after the lease period, he will be subjected to the same rent as was fixed during the lease period for the days he kept on possessing the asset, but it is on the basis of his further enjoying the asset after maturity and not for delaying the previous payable rent.
The third transaction mentioned in the said sub‑clause is hire purchase.
A hire‑purchase agreement may be defined as an agreement under which an owner lets chattels of any description out on hire and further agrees that the hirer may either return the goods and terminate the hiring or elect to purchase the goods when the payments for hire have reached a sum equal to the amount of the purchase price stated in the agreement or upon payment of a stated sum. The essence of the transaction is, therefore, (i) bailment of goods by the owner to the hirer, and (ii) an agreement by which the hirer has the option to return or purchase the goods at some time or another.
This transaction, as practised in the market, has different forms, some of which may have elements not conforming to Shariah, but it is not the right place to go into these details. Even if the hire‑purchase is adopted as mentioned above in its purest form, with no violation of a principles of Shariah, the question in the clause under discussion is not of the validity of the transaction in itself. The question here is one of payment of a 'return' on the promissory note or a bill evidencing the obligation to pay rent in a hire?purchase agreement. Therefore, it is subject to the same finding as recorded in the case of lease.
Next mentioned in clause (i) is the service charges. A service charge based on the actual (secretarial) expenses incurred by the financier in advancing a loan can be claimed by him from the borrower. This principle is ?derived from the following Qur'anic verse:
And the indebted person shall dictate (the document evidencing the debt). (2:82)
Here the preparation of the document of loan has been held to be the responsibility of the borrower which naturally means that if the documentation involves some expenses, they will be borne by the borrower.
The expenses of secretarial nature in a transaction of loan can be claimed by the financier, on condition that they are really based on actual expenses and are not a mere ruse for charging interest.
But again, the question in the clause in discussion is not whether service charge is or is not permissible. The clause contemplates that if the obligation of a service charge is evidenced by a promissory note or a bill, and its amount is not paid on the due date, the note or the bill will automatically obligate the debtor to pay a `return' on the note or the bill at the same rate as at which the original service charge was calculated.
The service charge is allowed only on the basis of actual expenses and not on the‑basis of a `return' at a specific rate. The secretarial expenses in advancing a loan are normally incurred only at the beginning when the loans are advanced. They are included in the original service charge evidenced by the promissory note. These are not normally recurring expenses, and if suttee additional expenses are incurred after the default through sending reminders etc. they are nut necessarily a? he same rate at which the original service chance was calculated. They can be less, and they can be more ii the financier has to take a legal action against the borrower.
Clause (ii) of the proviso to section 79 of the Act, 1881, however, needs some clarification.
Firstly, the words "when the loan was contracted" at the end of the clause are misleading. Financing on the basis of profit and toss sharing is ‑trot a loan. This word, therefore, is misconceived.
Secondly, the proportions of profit agreed to he distributed between the partners may be applicable as long as the Musharakah is not finally settled or liquidated, and so far this provision is correct. But the language used in the clause may cover a situation where a certain amount of profit is deserved by the financier after the liquidation and remained unpaid for a certain period. The words used in the clause may allow the financier to claim a further
return' on the unpaid amount at the same rate at which the profit was declared for the financier. This is again objectionable, because it the business is totally liquidated and what remains with the client is only the amount which the financier is entitled to receive as a debt, anyreturn' charged thereupon is not permissible, being interest charged on a debt.
Contracts by Chitty, Sweet and Maxwell, London, 24th Edn., 1977, Vo1.2, p.461, para.3212 and Ahkam‑al‑Qur'an by Al‑Jassas, Lahore, 1980, Vol.l., p.485 ref.
(f) Negotiable Instruments Act (XXVI of 1881)‑‑---
‑‑‑‑Ss.. 114 & 117(c)‑‑‑Constitution of Pakistan (1973), Art.203‑F‑‑?Repugnancy to Injunctions of Islam‑‑‑Provisions of Ss.114 & 117(c) of the Negotiable Instruments Act, 1881 which provide for charging of interest, are repugnant to the Injunctions of Islam‑‑‑If a party, however, has paid the amount due, inclusive of the interest payable on instrument prior to the date .of coming into force of the judgment of Supreme Court, the amount so paid by the payer for honour will, in all fairness, have to be allowed to be received by the party paying for honour‑‑‑.Shariat Appellate Bench of Supreme Court declared that the provision will cease to have effect from 30th June, 2001.
Section 114, Negotiable Instruments Act, 1881 confers a right on the payer for honour of a bill of exchange to recover his paid amount alongwith interest from the original debtor. Similarly, section 117 (c) entitles an indorser who has paid the amount of the bill to recover it alongwith an interest at the rate of' six per cent. per annum. Both provisions provide for charging of interest and, therefore, repugnant to the Injunction of Islam. However, if a party has paid the amount due, inclusive of the interest payable on instrument prior to the date of coining into force of this judgment, the amount so paid by the payer for honour will, in all fairness, have to be allowed to be received by the party paying for honour.
(g) Negotiable Instruments Act (XXVI of 1881)‑‑‑
‑‑‑‑S. 13‑‑‑Constitution of Pakistan (1973), Art. 203‑F‑‑‑Repugnancy to Injunctions of Islam‑‑‑Definition of "negotiable instrument" as given in S.13, Negotiable Instruments Act, 1881 does not, in itself, provide that it will. be traded in, or that it will be transferred or indorsed at a discount‑‑?Practice prevalent in the financial market that such instrument is discounted on the basis of interest is against the Injunctions of Islam as the same involves Riba‑‑‑Principles‑‑‑Shariat Appellate Bench declared that the provision will cease to have effect from 30th June, 2001.
The definition of a "negotiable instrument" as given in section 13 of the Negotiable Instruments Act, 1881 does not, in itself, provide that it will be traded in, or that it will be transferred or indorsed at a discount. But the practice prevalent in the financial market is that it is discounted on the basis of interest. This practice is against the Injunctions of Islam and involves Riba. A promissory note or a. bill of exchange represents a debt payable by the debtor to the holder. This debt cannot be transferred to anybody except at its face value. Discounting of a bill or a note or a cheque, therefore, involves interest. In an Islamic financial market, the papers representing money or debt cannot be traded. However, the papers representing holder's ownership in tangible assets, like shares, lease certificates, Musharakah certificates etc. can be traded in, And a viable secondary market can be developed on that basis.
(h) Land Acquisition Act (I of 1894)‑‑
‑‑‑‑Ss. 28, 32, 33 & 34‑‑‑Constitution of Pakistan (1973), Art.203‑F‑‑?Repugnancy to Injunctions of Islam‑‑‑Sections 28, 32, 33 & 34 of Land Acquisition Act, 1894 to the extent these contain the provisions relating to "interest" are repugnant to Injunctions of Islam‑‑‑Reasons and principles detailed ‑‑‑Shariat Appellate Bench declared that the provision will cease to have effect from 30th June 200:
Section 28 of the Land Acquisition Act, 1894 manifests the intention of the provision i.e. to compensate the landowner who was deprived of the land without payment of the true price payable. The deprivation so made is sought to be calculated through the prescribed mechanism i.e. compensation is being assessed at the rate of 6 per cent. per annum, difference of the amount payable for the period that the landowner was deprived of the usufruct of the land. The principle sought to be given effect is that an owner cannot be deprived of his property except by paying adequate and proper price/compensation thereof and that the rights in the property are not to be treated as transferred unless proper compensation is paid.
Section 32, Land Acquisition Act, 1894 regulates the amount of compensation which, for the reasons given in the previous section i.e. section 31 of the Land Acquisition Act, could not be paid to the rightful owner. Such amount lying with the Court is to be invested in the purchase of other land to be held under the like title and conditions of ownership as the land in respect of which such money has been deposited was held, or if such purchase cannot be effected forthwith, then in such Government or other approved securities. This section further provides that the interest or other proceeds arising from such investment shall be paid under the direction of the Court to the person/persons who are found entitled to the possession of the land acquired.
Section 33 of the Act provides for regulation of the money deposited in the Court for any cause other than the one mentioned in section 32 of the Land Acquisition Act and provides that such money deposited with the Court is to be invested in Government or other approved securities and the interest or the proceeds of any such investment are to be paid to the person/persons found entitled on the basis of their interest in the land and their entitlement to receive benefit from the land in respect of which the money had been deposited.
The true tests for adjudicating the real nature of an amount in the domain of Riba can come from the Holy Qur'an, Sunnah of the Holy Prophet (p.b.u.h.) and time tested opinions of the jurists and scholars well versed in Islamic Law and Shari'ah. Consequently, the process of reasoning employed for dubbing the interest payable under sections 28 and 34 to be something else than Riba is difficult to justify in Shari'ah. The increase or addition in the form of interest under sections 28 and 34 over the debt payable in the form of compensation by acquiring authority to the land?owners obviously falls in the category of Riba.
The first principle applicable is that in case of compulsory acquisition the compensation or the value of the land and the property acquired is to be paid either before taking over the possession of property or simultaneously with the taking over the possession or within such period of time after taking over the possession that the time involved may not be considered as real (mentionable) delay in making payment. If there is any delay, then it will be considered and treated that interest in the ownership of the land to that extent has not been passed. This is so treated so as to impress upon the necessity of making the payment of the due price/counter? value and it is for this reason that section 28 of the Land Acquisition Act provides for awarding an amount with reference to the amount of compensation which was less paid or assessed or fixed by the Collector.
From the viewpoint of Shariah, the acquisition is a compulsory purchase of a property from the owner and the compensation awarded to him is the price of such purchase. One of the necessary conditions of a permissible acquisition, is that the owner is given a fair market price of the property before or at the time of taking possession. If the Collector has paid less than the fair market price, it means that he has compelled the owner, not only to surrender his property without a fair price, but also to face the hardships of litigation. The function of the Court in this case is to fix a fair price of the property. While discharging this function the Court can take into consideration the injustice done to and the hardships suffered by the owner bf the property and may, thus, increase the price so as to make it more than the normal market price. Instead of adopting this simple mode, section 28 of the Act; 1894 has first fixed the price by specifying the "excess", then it has allowed an additional amount in the name of interest at the rate of 6% per annum. That is why it is repugnant to the Islamic Injunctions, because once the price is fixed and it became a debt, any increase over it calculated at per cent. per annum basis makes it interest, hence prohibited. On the contrary, if the price itself is increased for the considerations mentioned above, it will not entail interest, because the price of a property may be fixed on the basis of many considerations, including the hardship suffered by the seller at the hands of the purchaser in the same transaction.
Hence, awarding of compensation and the mechanism adopted in original section 28 as well as provided in Provinces of Punjab, Sindh and N.‑W.F.P. is objectionable from Shariah point of view. This section as is enacted in Balochistan vide section 9‑A, Balochistan Act XIII of 1985 also does not provide permissible mechanism to allow proper and adequate compensation. These sections shall be substituted by a provision to the following effect:‑‑
"In addition to the compensation fixed on the basis of market value as prevailing on the date of notification under section 4, an additional sum at the rate of fifteen per centum per annum (or the rate fixed from time to time) of the compensation so fixed shall be added to the compensation due and payable from the date of notification under section 4 till the date of payment of compensation finally."
As regards section 34, the amount awarded is not compensation paid to the owner for depriving him of his right to possess the land acquired but is given to him for deprivation of the use of money representing the compensation for the land acquired and as such is "interest" paid for the delayed payment of the compensation amount.
While correctly analyzing the nature of additional amount specified under section 28 one should not overlook the fact that the landowner has been deprived of the possession of his rightfully owned property without any compensation. Acquisition from the point of view of Shariah is a compulsory purchase by the Government. One of the basic conditions for the validity of such a compulsory purchase is that the fair market price is given to the landowner before or at the time of taking, possession or immediately after it. It means that a valid sale, in the case of acquisition, takes place only when the price is actually paid by the Government to the' landowner. Taking possession without the ‑payment of the price, in the case of acquisition, does not in itself amount to effecting a valid sale. The landowner, therefore, is entitled to claim a rent for the period commencing from the date of possession to the date of the payment of the price (the awarded amount) whereby the actual valid sale shall have taken place. This rent should not be less than the fair market rent in the relevant period.
What is wrong in section 34 is, firstly, the use of the word `interest' and secondly, determining the rate of eight per cent. per annum, with no regard to the rental value of the acquisitioned property. However, it may be provided that the landowner shall be paid the fair rental value or an amount equal to 8% per annum of the awarded amount, whichever is higher, from the time of taking possession to the time when the amount of compensation is actually paid to him.
Government of N.‑W.F.P. through Collector, Land Acquisition, Nowshera v. Muhammad Sharif Khan PLD 1975 Pesh. 161; Islamia University Bahawalpur through its Vice‑Chancellor v. Khadim Hussain and 5 others 1990 MLD 2158: Qazilhash Waqf and others v. Chief Land Commissioner. Punjab, Lahore add others PLD 1990 SC 99: Behari Lal Bhargava v. Commissioner of Income‑tax. C P and U.P. AIR 1941 All. 135: Commissioner of Income‑tax, Biltar and Orissa v. Rani Prayag Kumari Debi AIR 1939 Pat. 662; Revenue Divisional Officer, Trichinopoly v. Venkatararna Avvar and another AIR 1936 Mad. 199; Dr. Sham Lai Narula . The Commissioner of Income‑tax, Punjab Jammu and Kashmir, Himachal Pradesh and Patiala AIR 1964 SC 1878; .SIR 1970 SC 1702 and AIR 1972 SC 260 ref.
(i) Civil Procedure Code (V of 1908)‑‑
‑‑‑‑Ss.34, 34‑A & 34‑B(b)(c)‑‑‑Constitution of Pakistan (1973), Art.203‑F‑‑?Repugnancy to Injunctions of Islam‑‑‑Provisions of Ss.34, 34‑A & 34‑B, C.P.C. having been declared to be repugnant to Injunctions of Islam, Shariat Appellate Bench of Supreme Court directed that said provisions be suitably amended keeping in view the observations recorded in the judgment by the Court‑‑‑Shariat Appellate Bench declared that the provisions will cease to have effect from .30th June, 2001.
Section 34, C.P.C. provides that where a decree is for the payment of money, the Court may, in the decree, order "interest" at such rate as the Court deems reasonable to be paid on the principal amount adjudged, from the date of the suit to the date of the decree, in addition to any interest adjudged on such principal sum for any period prior to the institution of the suit, with further "interest? at such rate as the Court deems reasonable on the aggregate amount so adjudged, front the date of the decree to the date of payment, or to such earlier date as the Court thinks fit.
Section 34‑A, C.P.C. has been dealing with interest on public dues It provides that where the Court is of opinion that a suit was instituted with intent to avoid the payment of any public dues payable by the plaintiff or on his behalf, the Court may, while dismissing such suit, make an order for payment of 'interest' on such public dues at the rate of two per cent., above the bank rate.
Subsection (2) of section 34‑A, C.P.C. deals with a different situation. It provides that if the Court is of opinion that the recovery of any public dues from the plaintiff was unjustified, the Court may, while disposing of the suit, make an order for payment of interest on the amount recovered at the rate of two per cent., above the bank rate.
Section 34‑B, C.P.C. deals with interest on dues of a banking company. It provides that where .a decree is for payment of money due to a banking company in repayment of a loan advanced by it, the Court shall, in the decree, provide for interest or return, as the case may be, on the judgment debt from the date of decree till payment. It further provides that in case of interest‑bearing loans, the Court shall award a decree for interest at the contracted rate or at the rate of two per cent. above the bank rate, whichever is the higher.
Clause (b) of section 34‑B provides that in the case of loans given on the basis of mark‑up in price, lease, hire‑purchase or service charges for the contracted rate of mark‑up, rental, hire or service charges, as the case may be, the Government shall provide for interest or return at the contracted rate or at the latest rate of the banking company for similar loans, whichever is higher.
Clause (c) of section 34‑B, C.P.C. provides that in the case of loans given on the basis of participation in profit and loss, for return at such rate, not being less than the annual rate of profit for the preceding six months paid by the banking company on term deposits of six months accepted by it on the basis of participation in profit and loss, the Court shall, in the decree, provide for such return and at such rate, not less than the annual rate of profit for the preceding six months as stated above, which the Court may consider just and reasonable in the circumstances of the case.
Section 34‑B (b) and (c) relates to the recovery of money owed to a banking company by a client who entered into a transaction of mark‑up, leasing, hire‑purchase, service charge or profit and loss sharing.
These provisions of the Code are meant in more express terms for the recovery of the previous obligations.
Consequently, subsections (b) and (c) of section 34‑B of the C.P.C. are repugnant to the Injunctions of Islam.
The provisions of sections 34 and 34‑A, C.P.C. conferred a power on the Court to grant additional sum over and above the decreed amount and the sums to be allowed have been named as interest. Any amount over and above the principal amount of debt is Riba, hence prohibited. Therefore, any additional amount contemplated in these provisions does fall within the definition of 'Riba'.
In legal system of Pakistan the difficulties of the decree‑holders compound when the decree is sought to be executed. The obtaining of decree itself is not an easy task as all sorts of frivolous objections and delaying tactics are adopted/used for delaying completion of the trial. In addition to the delaying tactics adopted by the litigants the heavy work load of the Courts also contributes in delaying early and timely decision of cases. The number of cases daily fixed for hearing is so numerous that Presiding Officers cannot afford to give more than a few minutes to each case. The cases keep on lingering for years together due to all these factors.
The provisions of the Code of Civil Procedure are, therefore, to be viewed in the aforenoted perspective in addition to the legal question whether the power conferred by these provisions on a Court to grant additional amount over and above the amount decreed, though the said additional amount is called interest, falls within the definition of Riba.
The power conferred on the Court by law to grant additional sum is not premised on any act of the party to the transaction yet this grant of additional sum is without a counter‑value and is a payment receipt of which law permits over and above the principal amount. Thus, indirectly Riba al?-Nasiah has been allowed to be practised as it is Riba that is paid and received in a loan transaction and this is the Riba that has been prohibited by the Holy Qur'an. If the said provision is taken to be conferring a power on the Court to allow compensation to the lender/decree‑holder for the loss caused to him by not returning the amount of liability through vexatious pleas and dilatory tactics after the filing of the suit or even after passing of the decree then granting of such power to allow compensation cannot be objected to but the compensation at a fixed rate to be awarded in each and every case based on opportunity cost of money is not permissible as in each case such a power will have to be exercised in consideration of the circumstances prevailing in that particular case. The Legislature can also confer a power on the Court to impose penalty on a party who makes a default in meeting out his liability or who is found guilty of putting up vexatious pleas and adopting dilatory tactics with a view to cause delay in decision of the case and in discharge of liabilities and from the amount of such penalty a smaller or bigger part depending upon the circumstances can he awarded as solarium to the party who is put to loss and inconvenience by such tactics. The amount of penalty can be received by the State and used for charitable purposes and in the projects of public interest including the projects intended to ameliorate economic conditions of the sections of the society possessing little or nothing i.e. needy people/peoples without means. The provisions of the Code of Civil Procedure, quoted above, are therefore, repugnant to the Injunctions of Islam as laid down in the Holy Qur'an and Sunnah of the Holy Prophet for the reasons given above and these sections may, therefore, be suitably amended keeping in view the observations given above.
(j) Civil Procedure Code (V of 1908)‑‑‑
‑‑‑‑Ss. 2(12), 35(3), 144(1), O.XXI, R.11(2)(g), O.XXI, R.38, O.XXI, R.79(3), O.XXI, R.80(3), O.XXI, R.93, O.XXXIV, Rr.2(1)(a)(i) & (iii), (c)(i) & (ii), 2(2), 4, 7(1)(a)(i) & (iii), (c)(i) & (ii), 7(2), 11, 13(1), O.XXXVII, R.2 & O:XXXIX, R.9‑‑‑Constitution of Pakistan (1973), An.203‑F‑‑‑Repugnancy to Injunctions of Islam‑‑‑Word "interest" wherever appearing in Ss.2(12), 35(3), 144(1), O.XXI, R.11(2)(g), O.XXI, R.38, O.XXI, R.79(3), O.XXI, R.80(3), O.XXI, R.93, O.XXXIV, Rr.2(1)(a)(i) & (iii), (c)(i) & (ii), 2(2), 4, 7(I)(a)(i) & (iii), (c)(i) & (ii), 7(2), 11, 13(1), O.XXXVII, R.2 & O.XXXIX, R.9, C.P.C. being repugnant to Injunctions of Islam, was directed by Shariat Appellate Bench of Supreme Court to be appropriately . substituted ‑‑‑Shariat Appellate Bench declared that said provisions will cease to have effect from 30th June, 2001.
The word "interest" wherever appearing in section 2(12), section 35(3) section 144(1), Order XXI, Rule 11 (2)(g), Order XXI, Rule 38, Order XXI, Rule 79(3), Order XXI, Rule 80(3), Order XXI, Rule 9.5, Order XXXIV, Rule 2(1) (a)(i), (iii), (c) (i), and (ii), Order XXXIV, Rule 2(2), Order XXXIV, Rule 4, Order XXXIV, Rule 7(1)(a)(i) & (iii) and (c)(i) & (ii), Order XXXIV, Rule 7(2), Order XXXIV, Rule 11, Order XXXIV, Rule 13(1), Order XXXVII, Rule 2 and Order XXXIX, Rule 9 of C.P.C: shall be deleted and substituted appropriately.
Order XXXVII, Rule 2 (2)(a) and (b), C.P.C. are similar to the provisions of sections 79 and 80 of the Negotiable Instruments Act, 1881.
Both these provisions (i.e. sub‑rules (a) and (b) of Rule 2, Order XXXVII) of the Code are repugnant to the injunctions of Islam.
Rule 79 (3) of Order XXI of C.P.C. provides that if, in pursuance of a decree of recovery, a debt receivable by the defendant is sold, the Court shall prohibit the original creditor of that debt from receiving the debt or any interest thereon, and the debtor from making payment thereof to any person except the purchaser.
Similarly, Rule 80(3) of the Order XXI of the Code contemplates the transfer of a negotiable instrument, required for the purpose of recovery, and provides as under:
"Until the transfer of such negotiable instrument or share, the Court
may, by order, appoint some persons to receive any interest or dividend due thereupon and to sign a receipt for the same..."
Appointed person having been allowed to receive interest, the provisions were objectionable.
(k) Cooperative Societies Act (VII of 1925)‑‑‑
‑‑‑‑Ss. 59(2)(e) & 71(2)‑‑‑Cooperative Societies Rules, 1927, Rr. 14(1)(h), R.22, R.41 & Appendices I to IV‑‑‑National Industrial Cooperative Finance Corporation Limited Bye‑Laws, Bye‑Law 3(6)‑‑‑Constitution of Pakistan (1973), Art.203‑F‑‑‑Repugnancy to Injunctions of Islam‑‑‑Provisions of Ss.59(2)(e) & 71(2), Cooperative Societies Act, 1925; Rr.14(1)(h), R.22, R.41 and Appendices I to IV of Cooperative Societies Rules, 1927 and Bye?Law 3(6) of National Industrial Cooperative Finance Corporation Limited Bye‑Laws to the extent same provide for "interest", are repugnant to Injunctions of Islam‑‑‑Appellate Shariat Bench of Supreme Court directed that the word "interest" appearing in these provisions be deleted as the charging, levying and recovery of interest was not permissible under the Injunctions of Islam and provisions will cease to have effect from 30th June, 2001.
The word "interest" appearing in section 59 (2) (e) of the Cooperative Societies Act, 1925 and Rule 14(1)(h), Rule 22 and Rule 41 alongwith Appendices I to IV of the Cooperative Societies Rules, 1927 be deleted on the ground that charging, levying and recovery of interest is not permissible under the Injunctions of Shariah.
PLD 1992 FSC 1; PLD 1992 FSC 537 and PLD 1992 FSC 535 mentioned.
(l) Insurance Act (IV of 1938)‑‑‑
‑‑‑‑Ss. 3‑BB(1)(b), 27(3), 29(8)(b)(c)(iii), 47‑B(1)(2) & 81(2)(d)‑‑‑Constitution of Pakistan (1973), Art.203‑F‑‑‑Repugnancy to Injunctions of Islam‑‑‑Provisions of Ss.29(8)(b)(c)(iii), 47‑B(1)(2) & 81(2)(d) to the extent same provide .for range of rate of interest, guarantees as to the interest amount, payment of interest on instalments and other conditions as to interest, are repugnant to Injunctions of Islam‑‑‑Word "interest" appearing in Ss.29(8)(b)(c)(iii), 47‑B(1)(2) & 81(2)(d) may be deleted but to the extent of 5.27(3), Insurance Act, 1938 the words "rate of interest" has to be deleted in consonance with objectives of prohibition of interest under Shariah‑‑?Word "interest" in S.27(3) need not be omitted as same pertains to securities of, and guarantees as to principal and interest, by the Government of the country in whose currency such policies are expressed‑‑‑Word "interest" in S.27(3), therefore, be substituted with suitable amendments, keeping in view the purposes and the policy of the law On the lines indicated by the Court‑‑?Purpose behind the substitution of word "interest" should be to effectively implement the objectives of eliminating Riba from the economy of society without hampering the economic activities and also ensuring at the same time the growth and progress of the economy together with fairness to meet the obligations and liabilities‑‑‑Question whether insurance business as in vogue in the country was in accord with Injunctions of Islam being a different question, was not taken into consideration by the Shariat Appellate Bench of Supreme Court ‑‑‑Shariat Appellate Bench declared that the provision will cease to have effect from 30th June, 2001.
In section 27(3), Insurance Act, 1938 the words "rates of interest" may be deleted in consonance with the objectives of prohibition of interest under Shariah. The word "interest" appearing in subsection (3) of section 27 need not be omitted as this pertains to securities of, and guarantees as to principal and interest, by the Government of the country in whose currency such policies are expressed. This as such pertains to the assured of foreign origin and securities of foreign Government This amount, however, is to be taken notice in computing the investment required to be invested by an insured. The word "interest" appearing in the other provisions may, however, be deleted but it should be substituted with suitable amendments keeping in view the purposes and the policy of the law on the lines indicated in this judgment. The purpose should be to effectively implement the objectives of eliminating Riba from the economy of the society without hampering the economic activities and also ensuring at the same time the growth and progress of the economy together with fairness to meet the obligations and liabilities. However, the question whether Insurance business as in vogue is in accord with Injunctions of Islam is a different question, which is not under consideration.
(m) State Bank of Pakistan Act (XXXII of 1956)‑‑‑
‑‑‑‑S. 22(1)‑‑‑Constitution of Pakistan (1973), Art.203‑F‑‑‑Repugnancy to Injunctions of Islam‑‑‑Provision of S.22(1), State Bank of Pakistan Act, 1956 to the extent of purchase of Bills and other commercial instruments like Debentures, Bonds etc. on the basis of interest is repugnant to the Injunctions of Islam‑‑‑Mode of transacting such financial products/instruments has to be changed to a mode compatible with the Islamic modes of finance; Shariat Appellate Bench of Supreme Court, however, left said matter to the economists and bankers to adapt the new situation, keeping in view the Qura'nic prohibition of Riba‑‑‑Shariat Appellate Bench declared that the provision will cease to have effect from 30th June, 2001.
(n) West Pakistan Money‑Lenders' Ordinance (XXIV of 1960)‑‑‑
‑‑‑‑Preamble‑‑‑West Pakistan Money‑Lenders' Rules, 1965‑‑‑Punjab Money Lenders' Ordinance (XXIV of 1960), Preamble ‑‑‑Sindh Money Lenders' Ordinance (XXIV of 1960), Preamble ‑‑‑Balochistan Money Lenders' Ordinance (XXIV of 1960), Preamble‑‑‑Constitution of Pakistan (1973), Art.203‑F‑‑‑Repugnancy to Injunctions of Islam‑‑‑West Pakistan Mone3 Lenders' Ordinance. 1960; West Pakistan Money. Lenders' Rules, 1965; Punjab Money Lenders' Ordinance, 1960; Sindh Money Lenders' Ordinance, 1960; Balochistan Money Lenders' Ordinance, 1960; being the laws pertaining to money‑lending and money‑lenders and alien to Islamic Injunctions and the concept of Islamic Social Justice, could have no place on the statute book of the land and these laws and the Rules framed thereunder were repugnant to Injunctions of Islam ‑‑‑Shariat Appellate Bench of Supreme Court directed that the above laws shall cease to have effect from 31‑3‑2000.
(o) Agricultural Development Bank Rules, 1961‑‑‑
‑‑‑‑R. 17(1)(2)(3)‑‑‑Constitution of Pakistan (1973), Art.203‑F‑‑?Repugnancy to Injunctions of Islam‑‑‑Rule 17(1)(2)(3) of the Agricultural Development Bank Rules, 1961 on the question of interest is repugnant to Injunctions of Islam‑‑‑Levy, charging and recovery of interest being not permissible, Shariat Appellate Bench of Supreme Court directed that Rule in question be suitably amended on the lines indicated in the Judgment‑‑‑Shariat Appellate Bench of Supreme Court directed that the law shall cease to have effect from 30‑6‑2001.
(p) Banking Companies Ordinance (LVII of 1962)‑‑‑
‑‑‑‑Ss 25(2) & 9‑‑‑Constitution of Pakistan (1973), Art.203‑F‑‑‑Repugnancy to Injunctions of Islam‑‑‑Mark‑up‑‑‑Prohibition‑‑‑Extent‑‑‑Concept of a real tale, based on mark‑up, is not impermissible in its origin, subject to certain conditions, major condition being that it should not be charged on lending or advancing money and it must be based on the genuine sale of a commodity with all its substantive consequences‑‑‑When the word "mark‑up" used in S 25 of Banking Companies Ordinance, 1962 is read in juxtaposition with S.9 of the said Ordinance, it is certainly repugnant to Injunctions of Islam, because a valid mark‑tip transaction cannot be imagined without a genuine gale effected by the Bank, provision of mark‑up and provision of S.9 of the Ordinance, thus, cannot stand together and either of the two must be struck down‑‑‑Striking down of S:9, Banking Companies Ordinance, 1962 is necessary because provisions of S.9 are an obstacle in the way of a true Islamic Banking and the correct, just and practicable decision about the concept of mark‑up as provided in S.25 of the said Ordinance is not possible unless the bar imposed by S.9 is relaxed, word "mark‑up" in S.25 of the Banking Companies Ordinance, 1962 may therefore be retained‑‑‑Section 9 of the said Ordinance being repugnant to the Injunctions of Islam, in so far as the same prohibits Banks from purchase and sale of goods and other trading activities necessary for adopting the Islamic modes of financing like Bai Mu'ajjal and Murabaha based on mark‑up, leasing, hire‑purchase and Musharaka in their true and genuine forms ‑‑‑Shariat Appellate Bench of Supreme Court directed that S.9, Banking Companies Ordinance, 1962 be substituted to accommodate all the Islamic Modes of Financing with their necessary requirements and the provision of S.9 shall cease to have effect from 31st March, 2000.
Section 25(2), Banking Companies Ordinance, 1962 empowers the State Bank of Pakistan to give certain directions to banking companies, including a direction about the rates of interest, charges or mark‑up to be applied on advances, or prohibiting the giving of loans to any borrower on the basis of interest.
So far as the provision of interest in section 25 is concerned, it is against the Injunctions of Islam in the light of the Injunctions about Riba. The way 'mark‑up' is applied at present is nothing but Riba, hence prohibited. But at the same time the concept of a real sale, based on mark? up, is not impermissible in its origin, subject to certain conditions. The major condition for the permissibility of a mark‑up transaction is that it should not be charged on lending 'or advancing money. It must be based on the genuine sale of a commodity with all its substantive consequences. But section 9 of the Banking Ordinance prohibits a bank from trading. It is provided in section 9 that:
"Except as authorized under section 7, no banking company shall directly or indirectly deal in the buying or, selling or bartering of goods or engage in any trade or buy, sell or barter goods for others, otherwise than in connection with bills of exchange received for collection or negotiation."
When the word 'mark‑up' used in section 25 is read in juxtaposition with section 9, it is certainly repugnant to the Injunctions of Islam, because a valid mark‑up transaction cannot be imagined without a genuine sale effected by the bank. Therefore, the provision of mark‑up and the provision of section 9 cannot stand together. Either of the two must be struck down.
The transaction of a sale of Murabaha based on mark‑up, even after fulfilling its necessary conditions is not an ideal mode for the extensive use of Islamic Banks. Still, the banks will have to resort to this transaction in certain cases, especially in the initial phase of transformation. It is therefore, more necessary to strike down section 9 as it stands at present, instead of striking down the transaction of `mark‑up' totally, because provisions of section 9 are an obstacle in the way of a true Islamic Banking. These not only invalidate the transaction of Murabaha or Bai' Mu'ajjal according to Shariah, but also hamper the natural function of leasing hire-?purchase Musharaka or Mudaraba transactions. Section 9 was, in fact, designed in the context of interest‑based banking in which the banks deal in money and papers only, while a true Islamic financing is always backed by real assets, and this is the basic distinctive feature of Islamic Banking which can rid the economy from many evils of the interest‑based banking. The concept of Islamic Banking cannot be translated into reality unless it is realized that the banks are not meant only to deal in money and papers, but their financing is based on and firmly related with real business activities. The elimination of interest can neither be effective nor feasible without lifting the bar imposed on the banks by section 9 of the Banking Ordinance. The correct, just and practicable decision about the concept of mark‑up provided in section 25 is not possible unless the bar imposed by section 9 is relaxed.
Where a proper and just settlement of the issues involved in a law under challenge is not possible without striking another provision of the same law, the Court has the jurisdiction to hit that provision also.
A just decision about the mark‑up' envisaged in section 25 of the Banking Ordinance is not possible without striking down section 9. Therefore, the wordmark‑up' in section 25 may be retained, however, section 9 of the same Ordinance is repugnant to the
Injunctions of Islam in so far as it prohibits banks from purchase and sale of goods and other trading activities necessary for adopting the Islamic modes of financing like Bai' Mu'ajjaI and Murabaha based on mark‑up, leasing, hire‑purchase and Musharaka in their true and genuine forms. Section 9 shall be substituted to accommodate all the Islamic modes of financing with their necessary requirements.
Province of the Punjab v. Amin Jan Naeem and 4 others PLD 1994 SC 141 and Qazilbash Waqf v. The Land Commissioner, Punjab PLD 1990 SC 99 ref.
(q) Banking Companies Rules, 1963‑‑‑
‑‑‑‑R. 9(2)(3)‑‑‑Constitution of Pakistan (1973), Art.203‑F‑‑‑Repugnancy to Injunctions of Islam‑‑‑Provisions of R.9(2)(3), Banking Companies Rules, 1963 in so far these pertain to interest, are repugnant to the Injunctions of Islam ‑‑‑Shairat Appellate Bench of Supreme Court directed that the law shall cease to have effect from 30‑6‑2001.
Sub‑rule (2) of Rule 9, Banking Companies Rules, 1963 provides for crediting of interest on foreign approved securities on realization while sub‑rule (3) relates to crediting of interest realized on rupee securities. Sub‑rules (2) and (3) of Rule 9, in so far as they pertain to interest, are repugnant to the Injunctions of Islam as laid down in the Holy Qur'an and Sunnah of the Holy Prophet (p.b.u.h.). The retention of interest on foreign approved securities already realized need not be refused. The amount so received is to be credited to Baitul Mal and can be used for discharging the foreign debt and meeting out the other liabilities. Such a transitory and provisional course of action is allowed by Shariah. Same way, the interest received on rupee securities already issued and held can be similarly dealt with. However, in future such transactions which involve interest shall not be permitted.
(r) Banks (Nationalization) Payment of Compensation Rules, 1974‑‑
‑‑‑‑R. 9‑‑‑Constitution of Pakistan (1973), Art.203‑F‑‑‑Repugnancy to Injunctions of Islam‑‑‑Rule 9, Banks (Nationalization) Payment of Compensation Rules, 1974, which provides for reckoning of interest from the date of acquisition of the shares and its annual payment and the procedure of payment of interest and provisions referring to interest, are repugnant to Injunctions of Islam ‑‑‑Shariat Appellate Bench of the Supreme Court directed that instead of merely deleting the word "interest" from the various clauses of R.9, a new Rule should be framed on the lines indicated by the Court ensuring effective enforcement of prohibition of interest in future‑‑‑Return of the profit relatable to the shares to be managed through Shariah compliant modes ‑‑‑Shairat Appellate Bench of Supreme Court directed that the law shall cease to have effect from 30‑6‑2001.
Rule 9, Banks (Nationalisation) Payment of Compensation Rules, 1974 which provides for reckoning of interest from the date of acquisition of the shares and its annual payment and the procedure of payment of interest and these provisions referring to interest are repugnant to the Injunctions of Islam. Instead of merely deleting the word "interest" from the various clauses of Rule 9, a new rule should be framed on the lines indicated in the judgment ensuring effective enforcement of prohibition of interest in future. However, the return or the profit relatable to the shares shall be managed through Shariah compliant modes.
(s) Banking Companies (Recovery of Loans) Ordinance (XIX of 1979)‑‑‑
‑‑‑‑S.8(2)(a)(b)‑‑‑Constitution of Pakistan (1973), Art. 203‑F‑‑‑Repugnancy to Injunctions of Islam‑‑‑Provision of whole of S.8(2)(a) relating to interest and S.8(2)(b) of Banking Companies (Recovery of Loans) Ordinance, 1979 relating to mark‑up are repugnant to Injunctions of Islam‑‑‑shariat Appellate Bench 'of Supreme Court directed that said provisions be suitably amended keeping in view the observations recorded in the judgment ‑‑‑Shariat Appellate Bench declared that the provision will cease to have effect from 30th June, 2001.
(t) Islamic Jurisprudence‑‑‑
‑‑‑‑ Banking and economic system in Islam‑‑‑Infrastructure and legal framework to successfully practise Islamic Banking and economic system‑‑?Elimination of Gharar, deceit and fraud is necessary by providing effective and necessary legal framework in order to ensure success of any economic system ‑‑‑Gharar can be eliminated by bringing as much transparency, fairplay as possible in all public dealings‑‑‑Effort to eliminate only Riba. in isolation from banking system, would be more harmful than helpful due to intricate interdependence of different vital economic sectors, and efficient v: course will be to first identify and strengthen the existing critical economic sectors falling under Shariah, thus, isolating Riba‑based system for its proper treatment ‑‑‑Shariat Appellate Bench of Supreme Court gave? guidelines and laid down measures needed to be taken to provide? infrastructure and legal framework to successfully practise Islamic economic system.
The framing of the laws and economic and monetary policies is the function of concerned organs and institutions of the State and not of Supreme Court but as the Government in the present case has insisted in its application that guidelines be provided in respect of the issues raised and as the economists, religious scholars etc. have expressed their. opinion with respect to these issues and with respect to the infrastructure needed to successfully practise Islamic economic system, Supreme Court has recorded guidelines for the consideration of the concerned quarters
The scholars, economists 'and auditors are unanimous that elimination of Gharar, deceit and fraud is necessary by providing effective and necessary legal framework in order to ensure success of any economic system. The small investors who invested either in the stock markets or in bank deposits have been losers for the reasons that their savings have been eroded partially or fully because of presence of Gharar and speculative characteristics of stock markets. A reduction of nearly Rs. 300 billion in the market capitalization has gone unheeded. Similarly, defaults on bank loans amounting to approximately Rs.300 billion restricted these institutions to offer a reasonable return on deposits of small investors. Loopholes in the economic system allow defaulters to get away without any resistance and as such stringent measures/regulations are required to check speculative activities in the stock markets as also by formulating and administering monetary policy by an independent body which is competent and powerful enough to seek compliance of the monetary policy including borrowing activity prescribed under the laws/regulations to be framed and enacted in terms of the Constitutional mandate of Article 79 of the Constitution.
The laws in Pakistan on the subjects of good governance, fair dealings and transparency do exist but these need to be made comprehensive and also to the implemented in true spirit. Effort to eliminate only Riba. in isolation, from banking system would be more harmful than helpful due to intricate interdependence of different vital economic sectors, and that the efficient course will be to first identify and strengthen the existing critical economic sectors falling under Shariah, thus. isolating Riba‑based system for its proper treatment.
Four major engines of economy identified by the economists which fueled the West's economic growth are following:‑‑
(i) Banking/Financial Sector;
(ii) Share market;
(iii) Debt/Bond Market; and
(iv) Government Borrowing/Lending.
Creation of large middle class is also a touchstone of Islamic Financial model to fight for concentration of wealth in few hands.
The other pertinent thing to be noted is that the total value of capital market is much bigger than the GDP. So, even if we, in Pakistan, are successful in creating an Islamic based judicious regulations, at least for capital markets, we can hope for a quick change for the better as these reforms would be effective to check corruption in all the sectors. The disintermediation will also trigger competition within our banking sector towards promoting Islamic products. The regulatory framework to control unlawful conduct including Gharar is designed to maximize justice and fairplay at all levels of investors' interaction. Gharar can be eliminated by bringing as much transparency/ fairplay as possible in all public dealings. The disclosure requirements are so elaborate that speculative activities are minimized. This is achieved, inter alia. through the following measures:‑‑‑
(1) Individual's Credit History
No individual is allowed to get utilities connections, open any bank account, or obtain a loan unless his credit report received from a credit bureau is clean. These bureaus are non‑Government entities and by paying a nominal fee any organization can access the databases for requisite information.
(2) Industries' Rating
Four rating agencies namely, (i) Standard and Poor's, (ii) Moody's, (iii) DCR, and (iv) Fitch. IBCA are referred to by the financial institutions and lending institutions for reporting about credit ratings of the borrowers before extending loans, whether the borrower is a corporate body or other institution. The Security Exchange Commission, USA grants them licence and monitors their quality of work. In Pakistan, to regulate the business of credit rating companies, the Credit Rating Companies Rules, 1995 were framed by the Federal Government under section 33 of the Securities and Exchange Ordinance, 1969, but these Rules have not been usefully applied whereas in USA, individuals, corporations, banks and financial institutions and even the municipalities are all rated by the credit companies and their credit rating is relied upon by the investors before investing into the bonds or other instruments floated or offered for investment to the public. These ratings are instituted on the philosophy of right to know.
Even in England various statutes provide for prudential regulations and disclosure of necessary information. The Financial Services Act, 1986 and the regulations framed thereunder provide protection for the investors, with the "securitisation" of the investment industry in order to provide a system intended to make effective and to enhance London's position as a financial centre. The Serious Fraud Office (S.F.O.) was established as an integral part of the criminal justice system. The S.F.O. is responsible for investigation and prosecution of some of the biggest cases of fraud in British .history. The S.F.O. is an independent Government Agency headed by Director who exercises his powers under the superintendence of the Attorney‑General, maintains liaison with Government departments and regulatory bodies such as the Department of Trade and Industries, Bank of England. International Stuck Exchange, Securities and Investment Board, etc, These and other organizations report to the S.F.O. allegations of serious and complex abuses and misuse of powers and white‑collar crimes.
The distinctive feature of the S.F.O.'s approach to investigations is the use of multidisciplinary teams, a team of Lawyers, Accountants, Police Officers, etc. appointed in each case, headed by a lawyer, who acts as a case controller being responsible for ensuring expeditious investigation and effective prosecution. It is through such measures that the West has effectively adopted Islamic teachings of justice, fairplay and proper disclosure to minimize Gharar. These measures are to be adopted by providing proper legal framework so as to bring about fundamental changes in the fabric of our society as transparency will put the economy on the right track quickly. It is due to absence of this regulatory legal framework and transparency and prudential measures that the investors in Pakistan were deprived of billions in the shape of Taj Company and Cooperatives scams. There has been a quick growth of companies at Stock Exchange as the corporate managers are least bothered to take investors into confidence by sharing company information and do not feel any moral obligation to share profits with investors. All this is due to absence of strict regulations, third party ratings and risk assessment. A comparison between the size of the economy and number of listed companies can be a guide to the loose regulatory framework that encourages rogues to fleece investors and creditors in the disguise of "Limited Liability" Laws. The number of companies at Karachi Stock Exchange Market arc 750 while the number of listed companies at New York Stock Exchange is five times larger whereas economy of USA is more than 100 times bigger than Pakistan's economy. Unlike western countries there are no laws in Pakistan against insider trading (trading in Shares by owners) by major shareholders, which is conflict of interest, a crime in West.
The market indexes in the west like DOW JONES (USA), FTSE (UK), and Nikkei (Japan) were developed by third parties. In Pakistan tile KSE (Karachi Stock Exchange) 100 index is maintained by the stock market itself and has come under adverse comments from Ministry of Finance due to its speculative characteristics. It is said that this index serves the purpose of few players in the market by luring innocent investors into investment, thus, cyclically depriving them of their hard‑earned money. This also requires transmission by introducing independent transparency.
(3) Debt Markets in Pakistan
We have an inactive debt market and its savings have been repeatedly wiped out as unlike western markets during melting clown of stocks. debt markets are not in a position to provide the necessary "hedge" to the investors. The result of this under‑developed debt market is the promotion of Riba through savings being channeled into banking system as industries want long‑term finance. they have to resort to the banking system which in turn results in promoting Riba transactions. It' the concept of Islamic debt through Musharaka certificates is adopted on urgent basis. lot of equity/funds can be made available through developed debt markets and in that way reliance on banks can be reduced. Infrastructure can he provided by advising provinces/municipalities/corporate bodies to connote Qirad certificates/diminishing Musharaka certificates. thus, reducing reliance on foreign exchange borrowings and this is how local funds can he generated.
(4) Establishment of Data Collection Firms
??????????? The financial institutions should encourage experts, lawyers and others to establish firms for keeping track of the clients, individuals. corporations who commit default so that they could be brought before the competent Courts by facilitating service of the process of the Courts on them and also trace their properties and assets whether standing in their names or benami to facilitate recovery through execution of decrees. ???????
(5) Recovery System
The laws pertaining to recovery of the defaulted loans are to be streamlined alongwith establishment of requisite number of Courts presided over by competent judges of unquestioned integrity. These judges should not be over burdened and only such number of cases should he assigned to them which can be disposed of within a period of three months. The tendency to institute recovery proceedings only when the borrowing company or the individual have almost squandered away their assets requires to be curbed and defaulters must be brought to book by instituting proper proceedings within reasonable time of default when the borrower as well as his assets are still traceable and realizable.
(6) Training of Officers and Staff
The education of the officers and staff of the financial institutions so as to make them aware of the rudimentary or essential principles of Islamic economy is imperative. They should have necessary knowledge of the modes and the products to be used by them. These training institutions should include courses in accounting and audit procedures suited and conforming to the principles of Shariah. Such an education will be objective oriented and should inculcate commitment with the objectives of Shariah.
(7) Audit and Accounts
The development of audit and accounts system and procedures conforming to the principles/ Injunctions of Islam and capable of achieving objectives of Shariah is also essential. Such standards and procedures have been laid down in detail in the book titled "Accounting and Auditing Standards for Islamic Financial Institutions" published by Accounting and Auditing Organization for Islamic Financial Institutions P.O.Box 1176, Manama, Bahrain Institute of Chartered Accountants and Auditors with the assistance of the representatives of the State Bank of Pakistan and Finance Division should study these standards, procedures for introducing any modification, change, alteration, if any required to suit the requirements and the needs of Financial Institutions and Banks in Pakistan.
Measures needed to be taken, the infrastructure and legal framework to be provided may be summarized as under:‑‑‑
(1) Strict austerity measures to drastically curtail the Government expenditure should be adopted and implemented and deficit financing should he controlled as therein lies the solution to economic revival.
(2) An Act to regulate the Federal Consolidated Fund and Public Account, Provincial Consolidated Fund and Public Account requires to be enacted by the Parliament and the Provincial Assemblies respectively. This law will have to take care of borrowing powers, purpose and the scope of borrowing, its utilization, regulation and monitoring process including all ancillary matters.
(3) Law providing for necessary prudential measures ensuring transparency be enacted. These laws may include laws like Freedom of Information Act, the Privacy Act and Ethics Regulations of United States, Financial Services Act of Britain.
(4) Establishment of institution like Serious Fraud Office to control white collar and economic crimes.
(5) Establishment of credit rating agencies in the public sector.
(6) Establishment of evaluators for scrutiny of feasibility, reports.
(7) Establishment of special departments within the State Bank ‑
(a) Shariah Board for scrutiny and evaluation of Board's procedures and products and for providing guidance for successfully managing the Islamic economics.
(b) A Board for arranging exchange of information, financial institutions about feasibility of projects, evaluation thereof and credit rating of institutions, corporations and other entities., (c) A Board for providing technical assistance to the financial institutions/banks with regard to the anomalies emerging in the practical operation of the financial institutions or difficulties arising during operation of financial products, transactions or arrangements between the financial institutions and the consumers/clients. This may also take the shape of Islamic Financial Service Institution. Such institutions will also work in the field of shares and investment certificates underwriting promotion and market making to help in activation of primary and secondary markets. The rise of such institutions, whose functions include the promotion of financial instruments and to work as their catalysts in the financial market, would be of great help and support to Islamic Banking. Among the factors which would help the creation and spreading of such institutions is the extension of tax incentives to their operation as well as to Islamic Banks to benefit from their services.
The establishment of aforenoted infrastructure is considered necessary by the economists for operation of the Islamic banking system with success.
Keeping all these aspects in view, Shariat Appellate Bench of Supreme Court appointed different dates for different phases of the transformation and directed that:
(1) The Federal Government shall, within one month from the announcement of this judgment, constitute in the State Bank of Pakistan a high‑level Commission fully empowered to carry out, control and supervise the process of transformation of the existing financial system to the one conforming to Shariah. It shall comprise Shariah Scholars, committed economists, bankers and chartered accountants.
(2) Within two months from the date‑ of its constitution, the Commission shall chalk out the strategy to evaluate, scrutinize and implement the reports of the Commission for Islamization of the economy as well as the report of Raja Zafarul Haq Commission after circulating it among the leading banks, religious scholars, economists and the State Bank and Finance Division, inviting their comments and further suggestions. The strategic plan so finalized shall be sent to the Ministries of Law, Finance and Commerce, all the banks and financial institutions to take steps to implement it.
(3) Within one month from the announcement of this judgment, the Ministry of Law and Parliamentary Affairs shall form a task‑force, comprising its officials and two Sharjah Scholars from the Council of Islamic Ideology or from the Commission of the Islamization of Economy, to:
(a) Draft a new law for the prohibition of Riba and other laws as proposed in the guidelines above.
(b) To review the existing financial and other laws to bring them into conformity with the requirements of the new financial system, (c) To draft new laws to give legal cover to the new, financial instruments.
The recommendations of the task‑force shall be vetted and finalized by the "Commission for Transformation" proposed to be set up in the SBP. after which the Federal Government shall promulgate the recommended laws.
(4) Within six months from the announcement of this judgment, all the banks and financial institutions shall prepare their model agreements and documents for all their major operations and shall present them to the Commission for Transformation in the SBP for its approval after examining them.
(5) All the joint stock companies, mutual funds and the firms asking in aggregate finance above Rs.5 million a year shall be required by lam to subject themselves to independent rating by neutral rating agencies.
(6) All the banks and financial institutions shall, thereafter, arrange for training programmes and seminars to educate the staff and the clients about the new arrangements of financing, their necessary requirements and their effects.
(7) The Ministry of Finance shall, within gone month from the announcement of this judgment, form a task‑force of its experts to find out means to convert the domestic borrowings into project‑related financing and to establish a mutual fund that may finance the Government on that basis. The units of the mutual fund may be purchased by the public and they will he tradable in the secondary market on the basis of net asset value. The certificates of the existing bonds of the existing Government savings schemes based on interest shall be converted, into the units of the proposed mutual fund.
(8) The domestic inter‑Government borrowings as well as the borrowings of the Federal Government from State Bank of Pakistan shall be designed on interest‑free basis.
(9) Serious efforts shall be started by the Federal Government to relieve the nation from the burden of foreign debts as soon as possible, and to renegotiate the existing loans. Serious efforts shall also be made to structure the future borrowings, if necessary, on the basis of Islamic modes of financing.
(10) The following laws being repugnant to the Injunctions of Islam shall cease to have effect from 31st March, 2000:‑‑
(1) The Interest Act, 1839.
(2) The West Pakistan Money‑Lenders' Ordinance, 1960.
(3) The West Pakistan Money‑Lenders' Rules, 1965
(4) The Punjab Money Lenders' Ordinance. 1960.
(5) The Sindh Money Lenders' Ordinance, 1960.
(6) The N.‑W.F.P. Money Lenders' Ordinance. 1960‑
(7) The Balochistan Money Lenders' Ordinance, 1960.
(8) Section 9 of Banking Companies Ordinance, 1962.
(11) The other laws or the provisions of the laws to the extent that those have been declared repugnant to the Injunctions of Islam shall cease to have effect from 30th June, 2001.
Per Justice Khalil‑ur‑Rehman Khan, Chairman‑‑‑
(u) Constitution of Pakistan (1973)‑‑‑
Arts.203‑F, 203‑E & 203‑DD‑‑‑Jurisdiction of Shariat Appellate Bench of Supreme Court and Federal Shariat Court‑‑‑Scope‑‑‑Provisions of the Constitution, Muslim Personal Law and any law relating to the procedure of any Court or Tribunal is outside the purview or jurisdiction of the Federal Shariat Court and the Shariat Appellate Bench of the Supreme Court Jurisdiction of said Courts is, thus, limited to the examination of the r1m,stion whether any la", or provision of law is or is not repugnant to the Injunctions of Islam as laid down in the Holy. Qur'an and Sunnah.
(v) Constitution of Pakistan (1973)‑‑‑
‑‑‑‑Art.203‑B(c)‑‑‑Term "law" defined in Art.203‑13(c) also includes any custom or usage having the force of law or any law relating to banking or insurance practice and procedure‑‑‑Principles.
The term "law" also includes any custom or usage having the force of law or any law relating to banking or insurance practice and procedure. The Legislature consciously included within the definition of term "law" for the purposes of Chapter 3‑A of the Constitution of Pakistan "any custom or usage having the force of law". The term "lam," as used in Article 4 of the Constitution has also been used in Article 8 of the Constitution, in contradistinction with any "custom or usage having the force of law" and must, therefore, be given the same limited connotation in Article 4 as well.
Article 203‑B(c), Constitution of Pakistan, 1973 provides an inclusive definition of law. On the force of that definition itself any usage having the force of law shall qualify as law. Such a usage may relate to the nation or group as a whole or may relate to practice and procedure of the Court. The former has been included in the definition of law but the latter has been expressly excluded by providing that law includes any custom or usage having the force of law but does not include "any law relating to the procedure of any Court or tribunal". Law‑ here does not mean only the enacted law but includes usage having the force of law. Such usage or law may relate to procedure of Court or to matters not expressly excluded from the jurisdiction of the Court.
Federation of Pakistan through the Secretary, Ministry of Finance, Government of Pakistan; Islamabad and others v. United Sugar Mills Limited, Karachi PLD 1977 SC 397 and Wasi Ahmed Rizvi v. Federation of Pakistan PLD 1982 SC 20 ref.
(w) Constitution of Pakistan (1973)‑‑‑
‑‑‑‑Art.2A‑‑‑Mandate of the Constitution as enshrined in Art.2A of the Constitution .
The mandate of the Constitution as is apparent from the Objectives Resolution under Article 2A is that the Muslims shall be enabled to order their lives in the individual and collective spheres in accordance with the teachings and requirements of Islam as set out in the Holy Qur'an and Sunnah; and that adequate provision shall be made for the minorities to profess and practise their religions and develop their cultures; and also that fundamental rights including equality of status, of opportunity and before law, social economic and political justice, and freedom of thought, expression, belief, faith, worship and association, subject to law and public morality,. shall be guaranteed.
(x) Constitution of Pakistan (1973)‑‑‑
‑‑‑‑Arts.203‑D & 227‑‑‑Provisions relating to the Holy Qur'an and Sunnah‑‑‑Powers, jurisdiction and function of Federal Shariat Court‑‑?Scope‑‑‑If any enacted law is considered by anyone to be repugnant to the Injunctions of Islam, the course to be adopted, as provided by the Constitution, is to challenge the said law before the Federal Shariat Court under Art.203‑D of the Constitution, which power can also be exercised suo motu by the Federal Shariat Court.
(y) Constitution of Pakistan (1973)‑‑‑
‑‑‑‑Arts,73, 74, 78, 79, 80, 81, 82, 166 & Federal Legislative List, Entries 9 & 1()‑‑‑Rules of Business [Federal Government], Sched. II, R,3(3), Entries, No.13(6)(7) & 16‑‑‑Custody of Federal Consolidated Fund and Public Account‑‑‑Act of Parliament to regulate the custody of Federal Consolidated Fund as mandated by Art.79 of the Constitution‑‑‑Said mandate of the Constitution having' not been complied with, Shariat Appellate Bench of Supreme Court directed that such a law should be enacted without further loss of time so that prudential measures could be adopted so as to regulate management of Federal Consolidated Fund as well as Provincial Consolidated Fund and Public Account and the borrowing power of the Federation particularly‑‑‑Reasons.
The Federal Government has the power to frame the. financial, economic and fiscal policies of the State and also to provide necessary legal framework to execute such policies. It is the Federal Government which has the authority under the Constitution to operate and issue guarantees on the security of the Federal Consolidated Fund under such limits as may be fixed by an Act of the Parliament. However, no such law framed by the Parliament was referred. In the absence of such a law, the Government exercises unrestricted powers to borrow against the security of the Federal Consolidated Fund as no law has yet been framed to regulate the custody of Federal Consolidated Fund or the Public Account of the Federation. Though variety of rules such as Treasury Rules exist but in the absence of specific laws and rules pertaining to borrowing, it is, practically and ultimately the Rules of Business which are resorted to regulate the business of the Federal Government. Rules of Business [Schedule II, specified in Rule 3(3)] indicate at Entry No.13 `Finance Division' and the functions assigned to the said Division. In sub‑Entries 6 and 7 thereof, following items have been mentioned:
Public debt of the Federation both internal and external; borrowing money on the security of the Federal Consolidated Fund;
Loans and advances by the Federal Government.
It follows from these provisions of the Rules of Business that the lending and borrowing operations of the Federation are performed by the Ministry of Finance within the framework provided in the Rules of Business. No specific guidelines appear to have been provided to regulate and streamline such functions. It may, therefore, be inferred that the Secretary Finance or at best the Minister for Finance are free to make decisions on these subjects, though they may consult the Prime Minister if the matter is considered, in the discretion of the Secretary Finance or the Minister for Finance, to be an important policy matter. Rule 16 which specifies the cases required to be brought before the Cabinet does not contain borrowing proposals and as such even the Cabinet is not required to be taken into confidence. It will, therefore, be seen that neither the borrowings are restricted for specific uses nor the expediency of the situation necessitating borrowings has been spelled out. This situation of wide flexibility confers on the Finance Division unique and unlimited powers to borrow without at all being bothered about the productivity of the uses to which borrowed resources are applied or even without there being any limitation to the extent to which the nation is to be burdened with, borrowings.
As regards the revenues and loans credited to Federal Consolidated Fund and to Public Account, expenditures are incurred without regard to the sources of finds. It appears that no accounting is done for identifying the liabilities created by certain expenditures as revenues are mixed up with proceeds of loans and both are treated at par. This situation prevails as regards the borrowings both from foreign lenders as well as domestic lenders, as no distinction is made whether the borrowing is in rupee or to foreign exchange or from local and foreign markets. It is only the Government in power which is to decide freely the mix between the foreign and local borrowings or in rupee or in foreign exchange. Under the Federal Legislative List, Entries Nos. 9 and 10, make the subjects of foreign loans and foreign aid, Federal subjects.
As regards implications emerging from the legal provisions on the subject, the Federal Government enjoys borrowing powers under Article 78 of the Constitution. The mandate of Article 79 of the Constitution, however, is that an Act of the Parliament has to regulate‑
(a)??????? the custody of the Federal Consolidated Fund;
(b)??????? the payment of moneys into that Fund;
(c)??????? the withdrawal of moneys therefrom;
(d)??????? the custody of other moneys received by or on behalf of the Federal Government;
(e)??????? their payment into, and withdrawal from, the Public Account of the Federation; and
(f) ??????? all matters connected with or ancillary to the matters aforesaid.
This mandate has not yet been obeyed and complied with as no enactment has been, till date, framed and enacted by the Parliament. All the above matters are being dealt with under the Rules made by the President which Rules; as commented in one of the paragraphs above, are deficient in many respects and, in any case, cannot be a valid substitute of law framed by the Parliament itself. The Rules existing on the subject were probably made pursuant to section 151 of the Government of India Act, 1935, which section provided that the Rules may be made by the Governor‑General and by the Governor of Province for the purpose of securing all moneys received on account of revenues of the Federation or of the Province and also with regard to the moneys to be paid into the Public Account of the Federation or the Province. After the establishment of Pakistan, the Constitutions of 1956 in Article 62, the Constitution of 1962 in Article 38 and the Constitution of 1973 in Article 79 mandated for the enactment of an Act by the Parliament to regulate the custody of the Federal Consolidated Fund, the payment of and withdrawal of moneys into or therefrom as well as custody of other moneys received by or on behalf of the Federal Government, their payment or withdrawal from the Public Account of the Federation and all matters connected with or ancillary thereto. Reference may also be made to Article 81 of the Constitution of which clause (c) provides that the expenditure charged upon the Federal Consolidated Fund includes all debt charges for which the Federal Government is liable, including interest, sinking fund charges, the repayment or amortisation of capital, and other expenditure in connection with the raising of loans, and the service and redemption of debt on the security of the Federal Consolidated Fund. Reference may also be made to Article 166 of the Constitution which provides that the executive authority of the Federation extends to borrowing upon the security of the Federal Consolidated Fund within such limits, if any, as may from time to time be fixed by Act of Majlis‑e‑Shoora (Parliament), and to the giving of guarantees within such limits, if any, as may be so fixed. Similar provisions were contained in the Constitutions of 1962 and 1956 in Articles 139 and 115 respectively. In the absence of any such enactment providing guidelines and fixing the limits up to which the borrowing power can be exercised by the Federation, it was argued that the charged expenditure enjoys the protection of complete insulation from parliamentary oversight as, on the one hand, no guidelines exist and, on the other, such expenditure can be debated but is not to be put to vote. Moreover, the Federal Government has complete freedom to manage the finances of the Federation and this unrestricted power has plunged the nation into huge indebtedness and has ruined the economy. It would be seen that for almost fifty years we have not been able to obey the mandate of the Constitution by not enacting appropriate law defining the borrowing powers, the purposes, the use and limit of the exercise of such power. The contracts of billions of dollars burdening the nation through execution of sovereign guarantees are being entered into without information of even the members of the cabinet, what to say of obtaining approval of the National Assembly by a member of bureaucracy or advisor appointed by Prime Minister in his sole discretion injudiciously. The contract executed with I.P.Ps. provides sufficient basis for providing prudential laws and making approval of such contracts by the National Assembly mandatory. Such a law should be enacted without further loss of time so that prudential measures could be adopted so as to regulate management of Federal Consolidated Fund as well as. Provincial Consolidated Funds and Public Account and the borrowing powers of the Federation particularly.
(z) Constitution of Pakistan (1973)‑‑‑
‑‑‑‑Arts.2A, 227, 203‑D, 203‑F, 203‑B & 79‑‑‑Powers, jurisdiction and functions of the Federal Shariat Curt and Shariat Appellate Bench of Supreme Court‑‑‑Scope‑‑‑Enactment regulating the Federal Consolidated Fund or the Public Account ‑‑‑Repugnancy to Injunctions of Islam‑‑‑Question of repugnancy or otherwise of the Constitutional provisions on the touchstone of Injunctions of Islam cannot be examined by the Federal Shariat Court and also by the Shariat Appellate Bench of the Supreme Court‑‑‑Enactment which as and when framed regulating the Federal Consolidated Fund or the Public Account, as well as defining, prescribing and limiting the borrowing powers are enacted, the said Statute, enactment or even the rules shall have to conform to the Injunctions of Islam as contained in the Holy Qur'an and Sunnah of the Holy Prophet (p.b.u.h.) not in view of the provisions of Art.203‑B of the Constitution but also of the provisions of Art.2A and Art.227 of the Constitution‑‑Every law to be framed by the Parliament has to conform to the Injunctions of !slam and if any such law is found to be repugnant to the Injunctions of Islam. the Federal Shariat Court as well as the Shariat Appellate Bench of the Supreme Court has the power to scrutinize the said law on the touchstone of Islamic Injunctions and make the necessary declaration as is contemplated in Art.203‑D of the Constitution and the Federal Government or the Provincial Government, as the case may be, shall have to amend the law suitably as required in the judgment‑‑‑Principles.
It was contended that the process of prohibition cannot be extended to Government Finances under the existing scheme of judicial review of laws with regard to their consistency with the Injunctions of Islam on account of the fact that the Constitutional provisions cannot be scrutinized on the touchstone of Injunctions of Islam under Article 203‑D of the Constitution. It is on account of exclusion of the Constitution from the definition of the term "law" given in clause (c) of Article 203‑B that this view has been expressed. No doubt, the question of repugnancy or otherwise of the Constitutional provisions on the touchstone of Injunctions of Islam cannot be examined by the Federal Shariat Court and also by the Shari at Appellate Bench of the Supreme Court but the enactment which as 'and when framed regulating the Federal Consolidated Fund or the Public Accounts as well as defining, prescribing and limiting the borrowing powers are enacted, the said statute, enactment or even the rules shall have to conform to the Injunctions of Islam as contained in the Holy Qur'an and Sunnah of the Holy Prophet not in view of the provisions contained in Article 203‑B (c) but also of the provision of Article 2A and Article 227 of the Constitution.
The Court has no power to apply the test of repugnancy by invoking Article 2A of the Constitution for striking down any Article of the Constitution of the Islamic Republic of Pakistan for the reason that if any Article of the Constitution is in conflict with Article 2A, the appropriate procedure is to have it amended in accordance with the prescribed provision for the purpose. However, it does not absolve the Courts of their duty to give effect to the provisions of Article 2A as it has been made substantive part of the Constitution. A Constitution, is an organic whole. All its Articles have to be interpreted in a manner that its soul or spirit is given effect to by harmonising‑ various provisions. The Courts while construing the provisions of statute should make efforts that the interpretation of the relevant provision of the statute should be in consonance with Article 2A of the Constitution and the grund norms of human rights.
Effect of adoption of Objectives Resolution as Article 2A in the Constitution by the chosen representatives of the people as the operative part of the Constitution, is the acceptance of sovereignty of Allah to be binding on them who vowed that they will exercise only the delegated powers within the limits fixed by Allah. Such adoption also enhanced the power of judicial review of the superior Courts. The Constitution has adopted the Injunctions of Islam as contained in Qur'an and Sunnah of the Holy Prophet (p.b.u.h.) as the real and the effective law. In that view of the matter, the Injunctions of Islam as contained in Qur'an and Sunnah of the Holy Prophet (p.b.u.h) are now the positive law. Article 2A, made effective and operative the sovereignty of Almighty Allah and it is because of that Article that the legal provisions and principles of law, as embodied in the Objectives Resolution, have become effective and operative. Therefore, every man‑made law must now conform to the Injunctions of Islam as contained in Qur'an and Sunnah of the Holy Prophet (p.b.u.h.). Therefore, even the Fundamental Rights as given in the Constitution must not violate the norms of Islam.
Not' only the actions but also the laws to be framed as such are to conform to the grund norm established by the incorporation of the Objectives Resolution as substantive part of the Constitution with the addition of Article 2A in the Constitution Of the Islamic Republic of Pakistan, 1973.
The provisions of the Constitution conferring jurisdiction on the Federal Shariat Court to examine whether or not any law or provision of the law is opposed to the Injunctions of Islam, are to be interpreted in a manner which would give full effect to the process of Islamization, of laws and such interpretation will be more harmonious, with the spirit and letter of the Constitution.
Every law to be framed by the Parliament has to conform to the Injunctions of Islam as contained in Holy Qur'an and Sunnah of the Holy Prophet (peace be upon him) and if any such law is found to be repugnant to the Injunctions of Islam, the Federal Shariat Court as well as the Shariat Appellate Bench of the Supreme Court has the power to scrutinize the said law on the touchstone of Islamic Injunctions and make the necessary declaration as is contemplated in Article 203‑0 of the Constitution and the Federal Government or the Provincial Governments, as the case may be, shall have to amend the law suitably as required in the judgment.
Hakim Khan and 3 others v. Government of Pakistan through Secretary Interior and others PLD 1992 SC 595; The State v. Syed Qaim Ali Shah 1992 SCMR 2192; Zaheeruddin and others v. The State and others 1993 SCMR 1718; Mushtaq Ahmad Mohal and others v. The Honourable Lahore .High Court, Lahore and others 1997 SCMR 1043 and Dr. Mahmood‑ur‑Rehman Faisal v. Government of Pakistan through Secretary, Ministry of Justice, Law and Parliamentary Affairs, Islamabad PLD 1994 SC 607 ref.
(aa) Interpretation of Constitution?
Constitution being an organic whole, all its Articles have to be interpreted in a manner that its soul or spirit is given effect to by harmonizing various provisions:
(bb) Constitution of Pakistan (1973)‑‑‑
‑‑‑‑Arts.203‑F & 203‑D‑‑Repugnancy to Injunctions of Islam ‑‑‑Riba‑‑?Definition of Riba as finally determined by Shariat Appellate Bench of Supreme Court will provide touchstone for evaluating as to whether a provision of law conforms to the Injunctions of Islam or not and any such provision of law finally declared to be not conforming. to the Injunctions of Islam; shall have to be amended suitably‑‑‑Position of the past and closed transactions and the liabilities already incurred under the existing provisions of law is, however, different.
(cc) Islamic Jurisprudence‑‑‑
‑‑‑‑ Riba‑‑‑Concept‑‑‑Nature, classifications of Riba and impact of its prohibition on trade and business‑‑‑Literal meaning of word Riba classifies that it means the increased amount paid or claimed in excess of the principal by the borrower or the lender and it has been called Riba which is exactly what interest means ‑‑‑Qur'an declares each and every increase over the principal sum as Riba irrespective of the object or purpose for which the principal sum was borrowed ‑‑‑Riba, .therefore, means increase, addition, expansion or growth, technically refers to the "premium" that must be paid by the borrower to the lender alongwith the principal amount as condition for the loan or for an extension in its maturity ‑‑‑Riba is that excess amount which a creditor settles to ‑ receive/or recover from his debtor in consideration of giving time to the debtor for payment of his loan‑‑‑Purpose of loan is totally irrelevant in the context of the definition of Riba as the prohibition of the Qur'an extends to both the categories of Riba namely interest charged on commercial loans and the interest charged on personal or consumption loans ‑‑‑Qur'anic prohibition, therefore, includes every kind of increase or interest charged on loans advanced for commercial or consumption loans‑‑‑Milder interest is at par with harder interest ‑‑‑Riba includes both usuary and interest as known in English terminology, therefore, Bank interest is also Riba‑‑‑Riba, thus, is essentially in conflict with the clear and unequivocal Islamic emphasis on socio‑economic justice.
Al‑Qur'an Majid: Verses
(4:160‑161); Surah al‑Baqarah, Verses 278‑279; Qur'an 6:57; 7:54; Surh Al‑i‑hnran 111:130; Al‑Baqarah: Verses 275‑276; 2:188; 4:29; 4:161; 9:34: 30:39; 4:161; Tafsir and Hadith by Qatadah ibn Di'amah
(d.120 A.H.), Tabi'l: Islam Ke Ma'ashi Nazaviyye by Dr. Yusufuddin Vo1.lI, Karachi, 1984; Unlawful Gain and Legitimate Profii in Islamic Law by Dr. Nabil
A. Saleh; I'lam‑al‑Mawaqqrin, Vol.II, p.154ff, ?COMMERCIAL INTEREST
KI FIKHI HAISIAT? by Maulana Muhammad Jaafar Shah Phulwarwi and Syed Yaqoob
Shah; Stiengass English Arabic Dictionary, Lahore 1979, the word interest';A
Dictionary of Islam by Thomas Patrick Hughes, Lahore, 1964, p.544; Exold, xxii, 25,,Lev. XXV. 36 (Usuri); Tafsir Tabari by Imam Tabari (VOl.III, p.64); Kitab al‑Nihayah fi‑Gharib al‑Hadith wa ?Athor by Ibn al‑Athir, Cairo 1322 AH Vol.II, p.66; Ahkam al‑Qur'an by Ibn 'Arabi, Cairo, 1957, Vol.I, p.242; AI‑Haidayah by Allama Burhanuddin al‑Maghinani; Book
XIV on sale, Chap. VIII on Riba; Hidayah English Translation by Hamilton, Lahore, p.289; Tafsir al‑Kabir by Imam Fakhar Al‑Din Al‑Razi;
Ahkam al‑Qur'an by Allama Jassas, Istanbul, 1335 AH Vol.l, p.469; AIR 1944 Mad.243; Halsbury's Law of England, para.106 Vol.32, 4th Edn.; Futuha al‑Buldan by al‑Baladhuri, Cairo 1932 p.67; ai?Bahr al‑Muhit by Abu al‑Abdulasi
Vo1.II, p.335; Tabari, commentary of the Qur'an, Vol.IV, p.55; Futuh al‑Buldan by al‑Baladhuri, Leiden, p.56, Tayef; Verses 130 of Al‑Imran by
Tabari; Kitab al‑Amwal by Abu Ubaid al?Qasim ibn Sallam paras.506‑507;
Kitab al‑Amwal by Abu Ubaid, para.502; Book Islam Ke Muashi Nazariyyea, Karachi 1984, pp.44‑‑50; Tijarati Sud. Tarikhi Awr Fiqhi Nuqtah‑I‑Nazar
Se Aligarh 1967, pp.l‑5 and Shorter Encyclopedia of Islam 1953, p.471 ref.
(dd) Interpretation of Holy Qur'an‑‑‑
‑‑‑‑Principles.
(ee) Islamic Jurisprudence‑‑‑
‑‑‑‑ Riba‑‑‑Kinds‑‑‑Riba al‑Fadl‑‑‑Riba al‑Nasi'ah‑‑‑Concept and nature‑‑?Prohibition‑‑‑Extent.
(ff) Islamic Jurisprudence‑‑‑
‑‑‑‑ Riba‑‑‑Prohibition‑‑‑Extent‑‑‑Loans taken by tribes from each other, each tribe acting like a large partnership company‑‑‑Islam abolished the interest ?based nature of such relationship but re‑organised same on the basis of profit‑and‑loss‑sharing whereby the financier got a just share and the entrepreneur did not get crushed under adverse conditions, one of which was the caravan being waylaid during the journey.
AI‑Qur'an Majid: 3:130‑2 ref.
(gg) Islamic Jurisprudence‑‑‑
‑‑‑‑ Riba‑‑‑Prohibition‑‑‑Islamic economic order‑‑‑Any attempt to treat the prohibition of Riba as an isolated religious injunction and not as an integral part of the Islamic economic order with its overall ethos, goals. and values, is bound to create confusion.
(hh) Islamic Jurisprudence‑‑‑
‑‑‑‑ Riba‑‑‑Concept‑‑‑Rib a has a broader concept and stems from a violation of the Qur'anic decree that loans and debts must be settled on an equal basis and object for which loans are taken is also unimportant for purposes of Riba‑‑‑Correct approach to understand Riba would be to treat same as a technical term in the Qur'an and Hadith like Salah, Saum, Zakah and Hajj and to determine its meaning with reference to these two primary sources of Islamic knowledge‑‑‑All loans and debts must be settled on an equal basis (in terms of the units of the object of the loan/debt) and same principle is to be followed in retiring debts created in lieu of, for example, sales or purchases on deferred payment or delivery basis‑‑‑If a loan or debt is not handled in such a manner, that would constitute a violation of the law of Islam about Riba and, hence, give rise to Riba.
Riba is the predetermined, fixed and time‑related, increase over and above the principal of a loan or debt A distinction is also 'maintained between Riba al‑Nasi'ah (Riba in loans) and Riba al‑Fadl (Riba in trading). Several explanations are offered to rationalize the law of Riba. The most important of these explanations is that through the prohibition of Riba, Islam puts an end to Zulm (exploitation or injustice). Occurrence of Zulm is often traced to lenders seeking a return while borrowers might be in dire need of funds. Another conclusion drawn‑with reference to the permissibility of trade is that guaranteed return claimed by owners of capital is despicable because other economic agents have to exert effort and/or expose themselves to risk .for seeking any gains. While these explanations may have some element of truth in them, they leave much to be desired. For example, they become less convincing when one finds that Shariah does not, in normal conditions, prescribe any ceiling on prices and, thereby, the rate of profit even when trading activities may carry little or .no risk but it is to be remembered that charging of exhorbitant or excessive profit is not conceived.
A correct approach to understand Riba would be to treat it as a technical term in the Qur'an and Hadith, like Salah, Saum, Zakat and Hajj, and to determine its meaning with reference to these two primary sources of Islamic knowledge. Briefly, the argument can be understood with reference to the basic verdict on Riba in the Qur'an. In the light of al‑Baqarah 2:279 which restricts creditors to their principals, this decree can be stated as follows: All loans and debts must be settled on an equal basis (in terms of the units of the object of the loan/debt). The same principle is to be followed in retiring debts created in lieu of, for example, sales or purchases on deferred payment or delivery basis. If a loan or debt is not handled in this manner, it would constitute a violation of the law of Islam about Riba and, hence, give rise to Riba.
Interest is a predetermined, fixed and time‑related excess on loans and debts. But as explained above, Riba is a broader concept. It stems from ;t violation of the Qur'anic decree that loans and debts must be settled on an equal basis. Likewise, the purpose for which loans are taken is also unimportant for purposes of Riba.
(ii) Islamic Jurisprudence‑‑‑
‑‑‑‑ Riba‑‑‑Prohibition‑‑‑Bank interest is Riba‑‑‑Rationale.
At present, bank transactions involving interest come under the purview of loan transactions. Thus bank interest is Riba. That modern banks have no precedent in Islamic history is no ground for treating bank interest differently from Riba for two reasons. First, notwithstanding their complex nature, banks still personify groups of individuals‑their shareholders. Hence, the prohibition of Riba applicable to individuals automatically carries over to banks. Second, again notwithstanding the complexities of modern transactions, they are still combinations of primary transactions‑such as lending, trading, leasing, partnership, etc.‑for which the basic principles have been laid down. Any change in the nomenclature of interest to `mark?up' or 'profit' is inconsequential from the point of view of Riba as long as the basic transaction between banks and their customers remains a loan transaction.
Riba arises in loans, and profits in trading. A loan transaction represents the case of temporary exchange‑give and take back‑ of property rights of the thing at hand for the pendency of the transaction. Trading, oil the other hand, is a case of irrevocable exchange of property rights between two parties: ownership of the object of sale goes from the seller to the buyer and that of the thing paid toward price from the buyer to the seller. Alternatively, one may view the loan transaction as a homogeneous exchange and trading as a heterogeneous exchange. Thus, Riba and profits relate to two different situations with their own legal implications. Accordingly any comparison between the two is unwarranted. This point also applies to profits versus interest comparisons. Economists have viewed profits as reward for risk‑taking. This interpretation is only partly true. Primarily, profits arise in trading in which two parties are involved in the process of reciprocal and irrevocable exchange of then property rights. On the other hand, lending involves transfer of some of the rights related to that property only for the pendency of loan‑a limited period. The claim to a reward from another party through loan transactions, albeit Riba, is not recognized in Shariah.
Bank interest does fall under the definition of Riba. Banks have normally two tier transactions. On the one hand, they accept money from the savers and pay them return on their savings. On the other hand, they lend money to the entrepreneurs who pay return to the banks at a rate higher than the one paid by the banks to the savers. Let us take the second tier first. The money provided by the banks to the entrepreneur is undoubtedly a loan. Any increase on the principal amount paid by entrepreneur to the bank must and does fall under the category of Riba al‑Nasi'ah about the prohibition of which none has any reservation. It is besides the point whether the entrepreneur employs and invests that money in a business, commerce, trade or industrial enterprise. As long as the repayment of the principal amount is guaranteed whether because of the collateral or otherwise it will remain a loan (Qarz) and shall be subject to the principles of Shariah regulating loan (Qarz). Moreover, the concern of the banks is never to ensure the success of the enterprise or to participate in the risk at any stage in any way. There is no moral or legal justification to demand any increase over this amount. As to the money of the savers with the bank it is normally claimed to be an Amanat (Trust). Had it been really a trust it should have been regulated and managed under the law of Trust. For all practical, legal and theoretical purposes it has never been considered to be an Arnanat or Trust. It is always and has always been treated to be a loan and meets all the required ingredients of a loan (Qarz) under the Shariah; its repayment is guaranteed and the bank has full freedom to use, spend and invest it in any manner which the bank decides; the saver cannot even take it back at will without meeting certain conditions. In some cases a saver can take it back only in instalments and in other cases he has to give prior notice to the bank of his intention to withdraw his 'Arnanat' from the bank. Now, if it is a loan, no increase can be admissible thereon under the definition of Riba.
(jj) Islamic Jurisprudence‑‑‑
‑‑‑‑Riba‑‑‑Prohibition‑‑‑Hasan‑i‑Ada‑‑‑Concept‑‑‑Scope‑‑‑Deposit in Govern?ment‑sponsored saving schemes, Defence Savings Certificates, Treasury Bills, Federal Investment Bonds, Foreign Exchange Bearer Certificates, Prize Bonds and their likes, all being debt insialments and direct money‑for ?money exchanges, interest, mark‑up or "profit" offered on them is nothing but Riba irrespective of the name given to it‑‑‑Principles.
Deposits in Government‑sponsored saving schemes, Defence Savings Certificates, Treasury Bills, Federal Investment Bonds, Foreign Exchange Bearer Certificates, Prize Bonds and their likes, are all debt instalments'. The fact that it is the Government which is on the other side of the contract, does not change the character of the transaction. A loan is a loan whether it is taken from an individual, a group or an institution. From the Shariah point of view, all these instruments represent "loan" contracts between the Government and the parties subscribing to these instruments. The holder, in each case, gives money and wants his money back, and there is no other contract governing the legal relation with the issuer of these instruments. In a technical sense, therefore, these are all direct money‑for ?money exchanges. Accordingly, interest, mark‑up or "profit" offered on them is nothing but Riba irrespective of the name given to it. The same argument also applies to zero‑coupon bonds in which case buyers pay a lesser price initially but receive a greater sum equal to the face value of the bonds. Some people mix up the question of Government loans with the concept of Hasn‑i‑Ada or better repayment found in the Ahadith. 1t is contended that the Prophet of Islam (peace be upon him) used to please his creditors at the time of repayment of loan by paying him more than what was his due. It is pleaded that if the Government on its own pays or gives more than the amount received, it should not be considered Riba because it is not pre‑fixed or predetermined. This pleat may appear to be plausible on the face of it but this increased payment cannot he called Hasn‑i‑Ada. A Hasn‑i‑Ada was never declared beforehand, was never expected by the creditor and was never allowed to him as a matter of right, Moreover, it was a personal favour by the Holy Prophet (peace be upon him) to his creditor.
(kk) Islamic Jurisprudence ...
....Riba...Prohibition‑‑‑Extent‑‑‑Rent in a lease contract involves the transfer of usufruct of an asset while ownership remains with the lessor, therefore rent in such a case was not Riba‑‑‑Principles.
Rent arises in a lease contract that involves the transfer of usufruct of an asset while ownership remains with the lessor This is essentially a different arrangement as compared to a loan contract Therefore, there is no point in equating rent with Riba, Alternatively, one can say that, for example, house rent is not Riba because the tenant and the landlord enter into a transaction of money for housing services‑a heterogeneous exchange‑whereas Riba arises in give and take back of items of the same kind.
(ll) Islamic Jurisprudence ‑‑‑
‑‑‑‑Riba‑‑‑Prohibition extent ‑‑‑Mudarabah and Musharakah transactions are outside the purview of Riba‑‑‑Similarly Muzar?ah and Musaqaat being two special kinds of partnership is not Riba‑‑‑Principles.
In Mudarabah and Musharakah‑ two forms of business partnership‑the financier is also a legal party to the use of funds. Thus, these transactions are fundamentally different from a loan transaction. Accordingly, both these transactions are outside the purview of Riba. Similarly, Muzara'ah and Musaqaat‑two special kinds of partnership‑as such have nothing to do with Riba.
(mm) Islamic Jurisprudence‑‑‑
‑‑‑‑ Riba‑‑‑Prohibition‑‑‑Zulm‑‑‑Riba may lead to Zulm, and thus, the prohibition of Riba would result in putting an end to exploitative practices‑‑?End of Zulm, however, is not the genesis of prohibition of Riba‑‑‑Principles.
Riba may lead to Zulm, and thus, the prohibition of Riba would result in putting an end to exploitative practices. But it does not necessarily follow that an end of Zulm is the genesis of the prohibition of Riba. Restricting the rationale of the prohibition of Riba to the elimination of Zulm as referred to in al‑Baqarah 2:279 is mistaken for two reasons. First, the verse points to the existence of some dispute between two parties that was settled through this verse, while the end‑of‑exploitation explanation is given independent of the nature of the dispute. Second, the factual position was that according to this verse, both creditors and debtors were directed to give each other their respective rights in the light of the Shariah. It is pertinent to note that in the earlier revelations about the prohibition of Riba, the directive was that loan transactions be contracted and debts retired on equal basis, and there is no mention of Zulm or its equivalent.
(nn) Islamic Jurisprudence‑‑‑
‑‑‑‑Riba‑‑‑Prohibition‑‑‑Indexation‑‑‑Inflation‑‑‑Paper currency‑‑‑Debts de?nominated in paper currency are not exempted from law of Riba‑‑‑No Shariat law, however, exists on taking remedial steps to neutralize the effect of inflation for loan or other debts created through credit transactions‑‑?General principle in that regard would be that not only the means but also the ends should be Shariat compatible‑‑‑Recommended strategy would be to eliminate unanticipated inflation from the economy through prudent Government policies and to make anticipated inflation a part of decision ?making by all concerned, keeping in view their, needs and other interests‑‑?Principles illustrated.
According to the law of Riba, all loans and debts are to be settled on an equal basis in terms of the units of the object of loan or debt. In the case of paper currency, the exchange takes place by counting. Accordingly, the following conclusion would be drawn for loans for debts denominated in, for example, rupees: if the sum lent (or debt contracted) amounted to Rs. 1,000 the lender (creditor) may claim only one thousand rupees by counting ‑ no more, no less. This argument may also be restated, again, in the context of Riba, as follows:
(i) The nature of a loan transaction does not change with inflation. So, there are no grounds for changing the scope of the application of the law in inflationary regimes.
(ii) Lenders already incur transaction costs associated with loan transactions. Inflation just escalates those costs. So, there are again no grounds for changing the applicability of the law.
(iii) A lender may get nothing if the borrower expires without leaving! behind anything because debt is not transferable from one generation to the next through inheritance. Thus, reduction in value of loans and debts to zero does not represent a new situation, vis‑a‑vis the original rules dealing with Riba, that merits special treatment.
The factual position about the other ground for indexation‑putting an end to injustice to lenders and creditors ‑ has been clarified above. It can also be substantiated by noting that when Allah the Almighty directed the creditors to give grace period to debtors in a tight situation (al‑Baqarah 2:280), the extension was clearly with reference to the then existing debt obligations, not the inflation‑adjusted principal in future. In view of this there are no grounds for exempting loans and debts denominated in paper currency from the law on Riba. But despite the above analysis and conclusions drawn against indexation, there is no Shariah bar on taking remedial steps to neutralize the effect of inflation for loan and other debts created through credit transactions. A general principle in this regard would be that not only the means but also the ends should be Shariah‑compatible Keeping this in view, a recommended strategy would be to eliminate unanticipated inflation from the economy through prudent Government policies. and to make anticipated inflation a part of decision‑making by all concerned‑keeping in view their needs and other interests Thus, for example, instead of there being a loan to a needy person to fulfil his consumption or business need, there may be either a Bai' Mu'ajjal or a partnership arrangement between the resource‑owner and the needy party. While the need of the latter may be fulfilled, concerns of the former may be accommodated through the margin added in the deferred price or automatically adjusted through the realized profits.
(oo) Islamic Jurisprudence‑‑‑
‑‑‑‑Riba‑‑‑Prohibition‑‑‑Application‑‑‑Principles‑‑‑Relevant laws of Shariat which prohibit Riba are binding on individual believers as well as :on any collective entity that represents them and their Governments‑‑‑Said laws also apply to non‑Muslims subjects of a Muslim State‑‑‑Prohibition of Riba applies to both taking and giving Riba which implies that regardless of whom one may be transacting with and where, that person or anyone representing him ought to observe and abide by the prohibition of Riba‑‑?Prohibition of Riba essentially requires that, generally speaking, all like‑for‑like exchanges be, executed on an equal basis in terms of the relevant units of exchange and to pursue an alternative permissible course of action if this does not suit any one.
(pp) Islamic Jurisprudence‑‑‑
‑‑‑‑ Islamic Banking‑‑‑Basic principles in which the edifice of Islamic Banking and finance rests, enumerated.
The half a century long experience in the field of Islamic banking has brought to the fore a number of basic principles on which the edifice of Islamic banking and finance rests. Without having a clear perception of these fundamental axioms, no meaningful or worthwhile progress can be made in the direction of establishing Islamic banking. Before discussing the alternative modes of financing and investment suggested or put to operation so far, the suggested restructuring of banks and financial institutions and other necessary steps to be taken, it is appropriate that these axioms are enumerated in clear and specific terms:
(i) The banks under the Islamic system shall continue to perform their primary functions of receiving money from the savers and making it available lo various enterprises, entrepreneurs, business and businessmen. This exercise will be totally free from any involvement of Ribs, Qimar, Gharar and such other practices which have been prohibited by the Shariah.
(ii) Riba is prohibited in all its forms. There is no difference between usury and interest, simple and compound interest, interest on nominal rate and interest on exorbitant rates, All these forms of interest fall under the category of Riba and are prohibited, (iii) All transactions should be in exchange of commodities, goods, services or labour, No purely monetary transaction should be made because such transactions eventually lead to opening the door of Riba.
(iv) Loans should be avoided as far as possible in all commercial and business transactions. Financing on the basis of loaning and lending has no place in Islamic Shariah because the enterprise undertaken on the basis of lending and borrowing creates loopholes for usurious practices, (v) Lending and borrowing may be resorted to in exceptional cases to meet any emergency or contingency; but it should always be by a way of Qard‑i‑Hasan.
(vi) Banks under the Islamic system shall be primarily financial intermediaries to finance through equity, participation or partnership. Banks may also work as holding companies and may, where feasible, also directly engage themselves in commercial, industrial agricultural and other enterprises and businesses.
(vii) Any transaction or enterprise which is free from the fundamental prohibitions enumerated in the Shariah is Islamically allowed subject to other requirements laid down by the Shariah or the law, (viii)????? Banks may render their services and undertake their operations in accordance with any of the forms or alternatives hereinafter enumerated; subject to the fundamental consideration of equity and risk participation:
(a)??????? Mudarabah.
(b)??????? Musharakah.
(c)??????? Leasing.
(d)??????? Murabahah.
(e)??????? Bai Salam.
(f) Bai‑Muajjal.
(g) Istisna (Pre‑production sale).
(h) ?????? Muzaraah.
(i) Musaqah.
(j) Agency.
(k) Service charges.
(l) Qard‑i‑Hasan.
(m)?????? Buy ‑ Back Agreement (subject to certain conditions).''
(n)??????? Hire‑purchase.
(o)??????? Sale on instalments.
(p)??????? Developmental charges.
(q)??????? Equity participation.
(r)??????? Refit sharing.
(s) ?????? Sale and purchase of shares in such companies which have tangible assets.
(t) Purchase of trade bills.
(u) Financing through Auqaf.
There might be some duplication and over‑lapping in some of these modes mentioned above but these are some of the examples which only show how different scholars and experts tried to develop modes of financing and investment keeping in view the framework of the Shariah. These modes, even if the list is expanded, will not in any way be exhaustive because new modes and techniques will keep on coming into existence. It is always the need of the entrepreneurs and the requirements of the market which give rise to new and novel modes and techniques. The approach of Shariah is not to lay down a set of exhaustive modes or techniques and prohibit the rest. The approach of the Shariah is just the other way round. It prohibits certain practices and permits the rest. These and any other Shariah modes are to be understood and applied in the light of this observation. Alternatives do exist which are being practised in Islamic banks and can easily be developed into viable alternatives. .
(ix) In all transactions and dealings which involve any debt obligation the rights and privileges as well as the obligations and liabilities of both the. parties should be specified beforehand and shall not be subjected to any change or modification later without mutual consent. This will apply to the specifications of commodities and manufactured goods in the contract of Salam and Istisna and delivery in the payment of price in Bai‑Muajjal.
(x) No debt or financial liability can be sold at a discount. The discounting of bills have, therefore, been prohibited.
(xi) Transfer of obligation is permissible and shall be regulated under the laws of Kafalah and Hawalah.
(xii) Delay in payment of debt or in the delivery of goods should be dealt with under the law of civil obligations, or if need be, under the penal law for which appropriate provisions may be made in the statute book. Any delinquency or neglect of duty or obligation shall be dealt with under the normal law and shall not, in any way, lead to the increase in the financial liability of the concerned party.
(xiii) No debt shall be compounded or increased because of any delay or delinquency, however long it might be.
(xiv) Only tangible things or legitimate entitlements shall be the subject of contracts of exchange, such as sales, rent, leasing, salam etc.
(xv) No one shall be authorized to sell a commodity or title thereto without taking it into his actual or constructive possession. As such forward sales not covered under the rules of Bai Salam shall be prohibited.
(xvi) In a Salam sale both, the delivery of the commodity and the payment of the price cannot be deferred. It amounts to the sale of debt for debt which is not allowed.
(xvii) Exchanges of gold for gold, silver for silver, money for money e.g. local against foreign, shall be void if it is not hand‑to‑hand, i.e. on the spot.
(xviii) All such agreements and transactions 'in which two or more exchange contracts are interdependently combined, are void. For example, loan dependent on sale or sale dependant on a loan shall be void.
(xix) Benefits or usufruct accruing from the collateral is the right of the owner. Financier has no right to use or enjoy it.
(xx) Any uncertainty about the rights and obligations of the parties or the specification of the commodity or its value which may lead to a dispute or litigation invalidates the contract.
Under the Shariah no distinction can be made between interest and usury. It has been pointed out by different scholars that the distinction between usury and interest has no academic or scientific basis. It has been established that this so‑called distinction is made to justify interest on weak and emotional grounds.
One way of winning acceptability for interest was to emphasize the common elements, if any, between profit and interest, rent and interest or hire and interest. This was done to attract legitimacy to interest by confusing it with other categories.. At the same time, the difference in the high and low elites of interest was played up to establish that it is only the high or exorbitant rate which was bad while the fair rate was something fully justified on economic grounds. Once the economic grounds were accepted at the popular level, there was no difficulty in giving them a moral .justification too. Through this device, the evil of interest, Riba or Biyaj was attributed to usury and interest was artistically extricated from the consequences of this blame. This sophistry, as it was, is devoid even of superficial sanction. Even this superficial distinction made centuries ago to tolerate sonic forms of interest, has been rendered meaningless by the emergence of bank interest and credit in a powerful and institutionalized way.
Man and Money by Prof. Shaikh Mahmud Ahmad quoted.
(qq) Islamic Jurisprudence‑‑‑
‑‑‑‑Riba‑‑‑"Usury" and ‑interest"‑‑‑Concept‑‑‑No distinction between usury and interest‑‑‑Interest is an exploitative category completely indistinguishable from what was called usury a few centuries back‑‑‑Matter discussed in detail with its historical background.
Man and Money by Prof. Shaikh Mahmud Ahmad quoted.
(rr) Islamic Jurisprudence‑‑‑
‑‑‑‑ Riba‑‑‑Prohibition‑‑‑Monetary exchange and barter exchange‑‑‑Law of Riba takes care of both the economies‑‑‑Principles‑‑‑Islam acknowledges not only the real money, namely gold and silver or anything which may represent them, but also takes into consideration the barter practices and quasi money if it meets the requirements of measurement and storage of value and usability for making deferred payments.
(ss) Islamic Jurisprudence‑‑‑
‑‑‑‑ Economy in Islam‑‑‑Paper money‑‑‑Nature‑‑‑Fiat money is money for all practical purposes and will have to be taken as a substitute for gold and silver, the real and natural money‑‑‑Bonds, securities, debentures, treasury bills which have a ready market and are negotiable and easily convertible into real money within a short time, these should be treated like a substitute of the fiat money and should be subject to those very limitations and restrictions which control the fiat and real money‑‑‑Such other type of the money‑of‑account which have no ready market and not easily negotiable and convertible into real money, shall continue to be treated like personal instruments 'and Sukuk‑‑‑Principles developed to regulate the exchange of copper lulus will not be applicable to the paper currency and fiat money of today‑‑‑Today's paper money has practically become almost like natural money equal in terms pf its facility of exchange and credibility to the old silver and golden coins‑‑‑Such money will, therefore, be subject to all these .injunctions laid down in the Qur'an and the Sunnah which regulated the exchange or transactions of gold and silver‑‑‑Principles.
(tt) Islamic Jurisprudence‑‑‑
‑‑‑‑Economic in Islam‑‑‑Inflation‑‑Devaluation or demonetization‑‑‑Ghabn Fahish‑‑‑Meaning‑‑‑Inflation which reaches the stage of hyper inflation or galloping inflation is to be treated under the principle of Ghabn Fahish and would call 1br steps to be taken for the protection of the rights of the creditor and in such a situation principle in respect of fulus would be applicable‑‑‑Principle of fidus explained‑‑‑If demonetization or devaluation takes place by an order or decision of the Government which substantially reduces the value of money that particular date of such change will be taken to determine the value to be paid to the creditor‑‑‑Where, however, a formal devaluation or demonetization has not taken place it may not be possible to determine with certainty and exactitude as to the date on which the hyper?inflation took place and in view of absence of certainty and exactitude the safest way is to fall back on the date on which the transaction had taken place.
(uu) Islamic Jurisprudence‑‑‑
‑‑‑‑ Riba‑‑‑Forms of‑‑‑Common element in all the forms was the stipulated increase demanded by the creditor over and above the principal amount payable in a contract of loan or sale‑‑Various transactions prevalent as Riba during the pre‑Islamic days enumerated and discussed.
(vv) Islamic Jurisprudence‑‑‑
‑‑‑‑ Riba‑‑‑Punishment‑‑‑Riba is an offence of. unimaginable proportions and God simply does not recognize any person as a believer unless he gives up Riba.
(ww) Islamic Jurisprudence‑‑‑
‑‑‑‑ Riba‑‑‑Prohibition‑‑‑Exchange should take place only when both the commodities are fully similar and exactly equal to each other in terms of weight and measure and are delivered and received then and there, hand by hand‑‑‑Any increase or decrease on either side or any deferred payment or delivery will render the transaction as Riba‑based and will be disallowed.
(xx) Islamic Jurisprudence‑‑‑
‑‑‑‑ Riba‑‑‑Riba al Fadl‑‑‑Concept and historical' background stated with examples and illustrations.
(yy) Islamic Jurisprudence‑‑‑
‑‑‑‑ Riba‑‑‑Rationale and wisdom in the prohibition of Riba exhaustively explained.
(zz) Islamic Jurisprudence‑‑‑
‑‑‑‑ Riba‑‑‑Prohibition‑‑‑Prohibition of Riba extends to all increases on all forms of loans i.e. those meant for personal and consumption purposes as well as those for commercial and production purposes.
(aaa) Islamic Jurisprudence‑‑‑
‑‑‑‑ Riba‑‑‑Prohibition‑‑‑Element of Zulm to be seen in the wide application of concept of justice in the field of distribution and resources and socio?economic life in the society‑‑‑Principles.
(bbb) Islamic Jurisprudence‑‑‑
---Riba--and "interest"‑‑‑Major difference.
(ccc) Islamic Jurisprudence‑‑?‑‑‑‑
Riba‑‑‑Prohibition‑‑‑Economic rationale and moral wisdom of the prohibition of Riba.
(ddd) Islamic Jurisprudence‑‑‑
‑‑‑‑ Riba‑‑‑Prohibition‑‑‑Evils of "interest" that bring into focus the contradiction and conflict between the practice of "interest" and the overall teachings of Islam categorised and exhaustively discussed.
(eee) Islamic Jurisprudence‑‑‑
‑‑‑‑ Riba‑‑‑Prohibition‑‑‑Riba comes into direct conflict with a number of Qur'anic dictates and precepts and as soon as interest is allowed, a number of Qur'anic Injunctions cease to operate‑‑‑Illustrations.
(fff) Islamic ,Jurisprudence‑‑‑
‑‑‑‑Riba‑‑‑Prohibition‑‑‑Principle of mutual relation between profit and loss, discussed.
(ggg) Islamic Jurisprudence‑‑‑
‑‑‑‑Riba‑‑‑Prohibition‑‑‑Modern Banking System based on credit and loan‑‑?Life, dignity, property, honour and even freedom of people, not only on the national level but also at the international level is mortgaged to the creditors whose power and influence is constantly on the rise‑‑‑Such situation is inconsistent with the teachings of Islam where loan and credit have been considered to be an evil which may be resorted to only in very rare and exceptional cases of extreme necessity‑‑‑Principles.
(hhh) Islamic Jurisprudence‑‑‑
‑‑‑‑Riba‑‑‑Prohibition‑‑‑Justice‑‑‑Implications‑‑‑Humanitarian goals ‑‑‑Reali?zation‑‑‑Utilization of resources provided by God to mankind in such a manner that the universally‑cherished humanitarian goals of general need fulfilment, full employment, equitable distribution of income and wealth and economic stability are realized which can only be achieved by providing a humanitarian strategy and an important, though not the only, element of such a strategy is the abolition of interest‑‑‑Measures.
(iii) Islamic Jurisprudence ‑‑‑
‑‑‑‑Riba‑‑‑Prohibition‑‑‑Zulm‑‑‑Meaning, scope and contours of Zulm in the context of Riba stated.
(jjj) Islamic Jurisprudence‑‑‑
‑‑‑‑ Riba‑‑‑Prohibition‑‑‑Muqasid al‑Shariah.
(kkk) Islamic Jurisprudence‑‑‑
‑‑‑‑ Administration of justice in Islam ‑‑‑Implications‑‑‑Economy‑‑‑Riba‑‑?Elimination‑‑‑Justice is a comprehensive term in Islam and covers all aspects of human interaction, irrespective of whether it relates to the family, the society, the economy or the polity and irrespective of whether the object is human being, animal, insect or the enviornment‑‑‑Term "justice" has wide implications, one of the most important of these is that the resources provided by God to mankind should be treated like a trust and must be utilized in such a manner that the well being of all is ensured, irrespective of whether they are rich or poor, high or low, male or female, and Muslim or non‑Muslim‑‑‑Justice also demands that in the field of economics, the use of resources has to be in such an equitable manner . that the universally cherished humanitarian goals of general need fulfilment, optimum growth and full employment, equitable distribution of income and wealth, and economic stability are realized‑‑‑Strategy to achieve the goals requires, among other things, the injection of a moral dimension into economics in place of the materialist and hedonist orientation of capitalism, abolition of interest is a part of this moral dimension.
(lll) Islamic Jurisprudence‑‑‑
‑‑‑‑ Riba‑‑‑Prohibition‑‑‑Inflation‑‑‑Inflation set by as a formidable problem in the context of the elimination of Riba, analysed.
(mmm) Islamic Jurisprudence‑‑‑
‑‑‑‑ Riba‑‑‑Prohibition‑‑‑Indexation of loans, advances and various forms of credit‑‑‑History and techniques of indexation as prevalent in different countries, outlined‑‑‑Entire thinking and philosophy working behind the concept of indexation is Riba‑based economic thought ‑‑‑Indexation of loans, advances and various forums of credit, therefore, is not permissible in Shariah‑‑‑Grounds stated.
(nnn) Islamic Jurisprudence‑‑‑
‑‑‑‑Riba‑‑‑Prohibition‑‑‑Indexation‑‑‑Elimination of Riha‑‑‑Formulation of new policy or adopting a new method or technique‑‑‑Principle of Sadd al Dhariah or Foreclosure of the Door to be kept in view‑‑‑Measures.
(ooo) Islamic Jurisprudence‑‑‑
‑‑‑‑ Riba‑‑‑Indexation‑‑‑Prohibition‑‑‑Purview of prohibition on indexation covers not only loans and debts but also credit, barter, deferred exchange of currency. demonetization, delayed ,payment ‑ of remuneration after devaluation or revaluation, indemnity and change in the unit of currency at the time of redemption of loan‑‑‑Guiding illustrations provided.
(ppp) Bank‑‑‑
‑‑‑Functions of a Bank enumerated.
(qqq) Islamic .Jurisprudence‑‑‑
‑‑‑‑Riba‑‑‑Prohibition‑‑‑Modern Banking‑‑‑Current accounts, fixed deposits, saving accounts, special accounts ‑and term deposits etc. cannot be considered as Amanat nor Wadiah‑‑‑Principles‑‑‑Such accounts cannot be considered to be 'a Qard (loan) either because while a borrower is allowed to use, to invest or to spend the borrowed money, neither he is under obligation to pay any increase over and above the borrowed money nor a creditor (account holder) is allowed to receive any increase which is disallowed by Qur'an and Sunnah‑‑‑Bank accounts, therefore, have to be investments within the meaning of Ra's al‑Mal of a Mudarabah or Musharkah, and banking operation will have to be in accordance with the principles that regulate the Mudarabah, Musharkah and other Islamic modes of financing.
(rrr) Islamic Jurisprudence‑‑?
‑‑‑‑ Riba‑‑‑Prohibition‑‑‑Government bonds and securities in many cases represent a debt, loan or a deferred payment‑ ‑‑Shariah has expressly prohibited the sale or purchase of a debt for another debt‑‑‑Sale or purchase of a debt in lieu of a deferred payment is not allowable under Shariah being hit by Sunnah‑‑‑Open market operations involving the sale of debt for debt is? also not allowed under Shariah‑‑‑Such deferred payments should be sold or purchased on the basis of cash payment or, if cash payment is not possible, same may be processed through other Shariah compatible modes in the light of the law of Hawalah.
(sss) Islamic Jurisprudence‑‑‑
‑‑‑‑ Riba‑‑‑Prohibition‑‑‑Bank loans‑‑‑Provision of loans extended by Banks to possible entrepreneurs and businessmen‑‑‑Such loans are offered in the form of cash, opening of letters of credit, discounting of instruments etc.‑‑?Such loans are, to a very large extent, if not totally exclusive, advanced on the basis of interest whose payment alongwith the repayment of the principal is secured and guaranteed against a collateral; and the interest is charged in accordance with the prevalent rate‑‑‑Interest charged on all these kinds of loan is to be paid by the borrower irrespective of the fate or the outcome or the duration of the loan and irrespective of the success or failure of enterprise for which the loan was advanced‑‑‑Interest or increase charged on such loans fall under the category of Riba and is prohibited‑‑‑Bank interest cannot be equated with profit accruing to a Musharakah‑‑‑Principles.
(ttt) Islamic Jurisprudence‑‑‑
‑‑Riba‑‑‑Prohibition‑‑‑Bank loans‑‑‑Contract of loans (Qard)‑‑‑Lending transactions undertaken by Bank, are not in the nature of trust, deposit, Musharakah or sale but are in the nature of loan (Qard) pure and simple and have to be subjected to the restrictions placed by the Shariah on lending and borrowing of money and other fungible item‑‑‑Any increase over and above the amount borrowed is Riba irrespective of the pretext on which the increase is claimed‑‑‑Principles.
The true and legal position of bank loans under Islamic Shariah is that they are contracts of loans (Qard) because all the basic elements of Qard are found in these contracts. It has been held to be a Qard (loan) not only by almost all the contemporary Islamic scholars but also by the up‑holders and experts of this system ‑ even in the Western world. The repayment is guaranteed like a Qard, it is supported by a mortgage or a collateral like a Qard, the authority of the taker to use, spend, Invest or dispose it of is unlimited like a Qard; the lender has no concern with the purpose or the objectives for which it is taken. Finally, the success or failure of the enterprise of the purpose for which the loan was taken is absolutely irrelevant in both the cases. In view of all these obvious and significant facts it is not correct to claim that the lending transactions, undertaken by the banks are in the nature of trust, deposit, Musharakah or sale. It is in the nature of loan (Qard) pure and simple and has to be subjected to the restrictions placed by the Shariah on lending and borrowing of money and other fungible items. The most important of these principles is that the loan is to be returned exactly in the same quantity in which it was taken. Any increase over and above the amount borrowed is Riba irrespective of the pretext on which the increase is claimed. This principle is clearly embodied in the Qur'anic verses of Surah al‑Baqarah (verse 279). It was understood by the Companions, the Followers and the later jurists to be the cardinal principle governing a loan. There is unanimity of views among all the jurists of Islam that any benefit accruing out of loan is Riba.
Surah Al‑Baqarah (V: 279) ref.
(uuu) Islamic Jurisprudence‑‑‑
‑‑Riba‑‑‑Prohibition‑‑‑Banking‑‑‑Letters of credit of banks‑‑‑Purpose or the objective of the opening of letters of credit is not objectionable‑‑‑Such Letter of Credit, if relates to the time and duration of payment and is collected to terms or percentage of the amount paid, it becomes Riba‑‑‑Measures to bring the system according to Shariah, outlined.
The purpose or the objective of the opening of letters of credit is not something objectionable. On the other hand, it is a facility extended by the banks to the traders and the businessmen. The purpose of opening letters of credit is to facilitate quick and easy payment and the transfer of money from one place to another. This facility, being a lawful service, has to be properly compensated in terms of Shariah. If the payment of compensation or remuneration is linked with the volume of service, the Shariah has no objection.. In this case it will be a kind of service charge which has' been already considered and approved by almost all the contemporary scholars and learned bodies. In this case it will be necessary that the rate of service charge is determined keeping in view the magnitude of the service, quickness of the payment and the level of credibility and performance of the bank concerned. Since it is related with the time or duration of payment and is collected in terms of percentage of the amount paid, it becomes Riba. There is no objection if the banks require collateral or hypothication of certain assets or securities to ensure timely repayment. provided the guarantor does not charge any interest and the mortgage is controlled by the law of Riba. The payment made by the bank 2o an importer or a purchaser under a letter of credit is again in the nature of Qard because it does not fall in any other legitimate category of transaction As such it is to be regulated under the law of Riba. It seems worthwhile if the State Bank of Pakistan determines certain fixed rates of service charge to he paid by the importer/purchaser to the bank as a compensation to the service rendered by the Bank. There ma) he different rates for different kinds of transactions provided these rates do not change with any delay in the payment and are not calculated on the basis of the amount of money involved. There may be flat rates for various kinds of transactions whenever letters of credit are needed to be opened.
(vvv) Islamic Jurisprudence‑‑‑
‑‑‑‑Riba‑‑‑Prohibition‑‑‑Banking‑‑‑Discounting of negotiable instrument by State Bank of Pakistan has to be tackled in the light of Shariah ‑‑‑ Discounting of negotiable instrument is not tale but is the sale of debt for higher price and deferred payment is also involved in the sale of money for money and, therefore, is to be construed as a loan and has to be regulated as a loan‑Increase ultimately earned by the Bank through the operation of discounting the instrument, thus, would fall under the category of Riba.
(www) Islamic Jurisprudence‑‑‑
‑‑‑‑Riba‑‑‑Prohibition‑‑‑Banking‑activities undertaken by the Banks on payment of such fee, remuneration or service charges as may be fixed by the State Bank or determined by the concerned Bank under the general guidelines issued by the State Bank of Pakistan, not related to the time frame of any payment or repayment and calculated exclusively on the basis of volume of labour involved and the nature of service rendered, are allowed‑‑?Principles.
(xxx) Islamic Jurisprudence‑‑‑
‑‑‑‑Riba‑‑ Prohibition‑ Analysis of interest‑based banking operations in the perspective of Injunctions of Islam‑‑‑ Development of Riba‑free alternative modes conforming with the requirements of Shariah, suggested.
(yyy) Islamic Jurisprudence‑‑‑
‑‑‑‑Riba‑‑‑Prohibition‑‑‑Borrowing by the Government‑‑‑Steps to be taken for interest‑free economy‑‑‑Summary of position taken by representative of the State Bank, the apprehension expressed, the difficulties counted, the explanation offered and the proposals mooted by the scholars, economists and bankers‑‑‑Measure to be adopted outlined.
Federation of Pakistan through the Secretary, Ministry of Finance Government of Pakistan, Islamabad and others v. United Sugar Mill Limited, Karachi PLD 1977 SC 397; Wasi Ahmed Rizvi v. Federation of Pakistan PLD 1982 SC 20; Hakim Khan and 3 others v. Government of Pakistan through Secretary Interior and others PLD 1992 SC 595: The State v. Syed Qaim Ali Shah 1992 SCMR 2192; Zaheeruddin and others v. The Stag: and others 1993 SCMR 1718; Mushtaq Ahmad Mohal and others v. The Honourable Lahore High Court, Lahore and others 1997 SCMR 1043; Dr. Mahmood‑ur‑Rehman Faisal v. Government of Pakistan through Secretary, Ministry of Justice, Law and Parliamentary Affairs, Islamabad PLD 1994 SC 607; Al‑Qur'an Majid: Verses 4:160‑161; Surah al‑Baqarah, Verses 6:57; 7:54; 278‑279; Surh Al‑i‑Imran 111:130; 2:188; 4:29; 4:161; 9:34; 30:39; 4:161; Tafsir and Hadith by Qatadah ibn Di'amah; Islam Ke Ma'ashi Nazariyyea by Dr. Yusufuddin, VoI.II, Karachi, 1984; Unlawful Gain and Legitimate Profit in Islamic Law by Dr. Nabil A. Saleh; Flam‑al?Mawaqqrin, VoI.II, p.154ff;"COMMERCIAL INTEREST KI FIKHI HAISIAT? by Maulana Muhammad Jaafar Shah and Syed Yaqoob Shah; English Arabic Dictionary by Stiengass, Lahore, 1'979; A Dictionary of Islam by Thomas Patrick Hughes, Lahore, 1964, p.544; Exold, xxii, 25, .Lev. XXV. 36 (Usuri); Tafsir Tabari by Imam Tabari, Vo1.III, p.64; Kitab al‑Nihayah fi‑Gharib al?Hadith wa'‑Athor by Ibn al‑Athir, Cairo 1322 AH, VOIAI, p.66; Ahkam al?Qur,'an by Ibn 'Arabi, Cairo, 1957, Vol.I, p.242; AI‑Haidayah by Allama Burhanuddin al‑Maghinani; Book XIV on Sale, Chap. VIII on Riba; Hidayah (English Translation by Hamilton), Lahore, p.289; Tafsir al‑Kabir by Imam Fakhar Al‑Din Al‑Razi; Ahkam al‑Qur'an by Allama Jassas,. Istanbul, 1335, AH, Vo1.I, p.469; AIR 1944 Mad.243; Halsbury's Laws of Fngland. 4th Edn., vol.32, para.l0o: Futuha al‑Buldan by al‑Baladhuri, Cairo, 1932, p.67; al‑Bahr al‑Muhit by Abu al‑Abdulasi Vol.Ii, p.335; Commentary of the Qur'an by Tabari, Vol.IV, p.55; Futuh al‑Buldan by al. Baladhuri, Leiden, p.56, Tayef; Kitab al‑Amwal by Abu Ubaid al‑Qasim ibn Sallam, paras.5.06‑507; Kitab al‑Amwal by Abu Ubaid, para.502; Book Islam Ke Muashi Nazariyyea, Karachi, 1984, pp.44‑‑50; Tijarati Sud: Tarikhi Awr Fiqhi Nuqtah‑i‑Nazar Se, Aligarh, 1967, pp. 1‑5 and Shorter Encyclopaedia of Islam, 1953, p:471 ref.
Per Justice Wajihuddin Ahmed, Member‑‑‑‑
(zzz) Islamic Jurisprudence‑‑‑
‑‑‑‑ Riba‑‑‑Concept‑‑‑Brief historical survey of the position; analysis of concept of Riba at the etymological and epistemological levels; identification of foundations of the institution of Riba in Islam demonstrated through the relevant texts and Ahadith; connotations. and implications of Riba and to what extent and in what manner or form Riba interacts with modern day economies; what. foreseeable consequences would follow if the command as to Riba is duly enforced and what should be the mode and method of necessary translation of the command into actual practice‑‑‑Islam does not permit Riba in any shape or form, whether amongst Muslims or between Muslims and non‑Muslims (other than harbis) irrespective of the question where any of such contracting parties is domiciled or otherwise located‑‑?Prohibition applies equally to non‑Muslims located within the bounds of a Muslim State‑‑‑.Commandments as to Riba, inclusive of the present day practices of interest and usury, being all pervasive, transcend individuals and envelope not only groups of men or their institutions but even geographical entities such as State edifices‑‑‑Concept of Riba itself has no nexus whatever either with productive or non‑productive loans or the soft or hard terms upon which Riba is generated incidental to such loans‑‑‑All interest‑bearing loans or advances, whether between depositors and Banks, financial or other institutions or between any other category of borrowers and lenders, including Governments or their agencies, whether sovereign or otherwise, would be hit by the Islamic Injunctions concerning Riba and, as from the efflux of the time frame(s) prescribed no lender would be entitled to claim anything more than that loaned nor any borrower be liable to pay anything in excess of that borrowed‑‑‑ Interest which has already accrued, accounted/paid for or otherwise standing appropriated in the context of Ribawi transactions such as postulated in the Holy Qur'an and Sunnah, would remain a matter between the offenders and their Greater‑‑‑No disruption or' irreversible chaos would follow upon a switch‑over from a Ribawi economy to an Islamic economic order ‑‑‑Riba‑free economy may be a non‑starter if the same is introduced in a continually selfish, dishonest and corrupt socio‑economic milieu, such as that which prevails‑‑‑Possible pre‑emptive measures detailed.
His Lordship, after expressing general agreement with the findings and conclusions of Mr. Justice Khalil‑ur‑Rehrnan Khan and .qtr. Justice Maulana .Muhammad Taqi Usmani together with some explicit or implicit reservations, made the following express mention of some matters:‑‑
?(i) With respect, the finding, that Riba al‑Fadl was not envisioned in the Qur'an and introduced, for the first time, by the Prophet of Islam appears, both factually and historically, to be ill‑founded. As dilated upon above, the concept had, broadly, found a place in the Old Testament and besides, Arabs of the time physically indulged in Riba al‑Fadl, as the quoted Ahadith of Bilal (r.a.a.),. and the Prophet's (s.a.a.w.s.) representative at Khyber would tend to demonstrate. Thus, the Qur'an cannot be assumed to have ignored either the previous revelations in the Scripture or the facts on the ground. Prophet (s.a.a.w.s.), nonetheless, has been fully credited with articulating and perfecting the institution of Riba al‑Fadl. Even so. the view‑, of my‑learned brothers may not make any particular difference because, after the Qur'an, Sunnah is the most important source of Muslim Law and the Prophet (s.a_a.w.s.) never disc rinunated in the import or effect of either ?form of Riba. Thus, whatever be the rationale, Riba al‑Fadl would remain as much prohibited for Muslims as Riba al‑Nasiah.
(ii) In my humble opinion, Government, and particularly an Islamic Government, cannot be differentiated in the way of so‑called "voluntary" additions and all such increases, upon the touchstone of Qur'an and Sunnah constitute nothing but Ribu. Furthermore, in so far as law‑making touching the relevant Consolidated Funds and Public Accounts are concerned, two aspects need be under‑scored:‑‑‑
(a) In the absence of due fulfilinent of the Constitutional requirement w provide necessary framework on the point, all debt raising loses legal sanctity.
(b) After our declarations qua Riba, no law can now be framed, regulating Riba‑infested borrowing by Government: Borrowing has now to be Riba‑free and only if absolutely necessary, for Islam does not sanction any other form of borrowing.
(iii) Evidently, the objective behind some of the affirmative observations, regarding the "mark‑up" system, is merely to sanction trading, upon duly and fully complying with the concepts of Bai .Muajjal and Marabaha sale, each observing the caution, administered by the Holy Prophet (s.a.a.w.s.) of physical delivery of the goods sold.
(iv) As regards the Shariah compliant modes and instruments of finance let it be noted that such already stand, very largely, developed. No unnecessary time should, therefore, be lost in that direction nor banks and other financial institutions should, in any manner, delay the due implementation of a Riba‑free and profit and loss‑oriented Islamic system.
(v) I have reservations about the time schedule, adopted in the Order of the Court. Besides, there are some lacunas in it. In my humble opinion comparatively smaller periods would have been sufficient. Any way, consensus, in essentials, is a prerequisite in such delicate matters and such is reflected in .the Order of the Court. Having said that, there should be no misgivings in any quarters that this or the Federal Shariat Court would brook any unnecessary delay during the implementation phase of the judgment of this Court. Thus, time schedule or not, no one, be it the Government itself, would any longer be countenanced to conduct any further avoidable Ribawi dealings, here or with the outside world. Transgressions, if any, can be appropriately brought to the notice of the Court.
(vi) Lastly, ' there are some aspects of the matter e.g., inflation/indexation and the argument of Mr. M. Aslam Khaki regarding the lawfulness or otherwise of a fixed (percentage) payment to the contributor of capital, subject to accrual of profits from a venture, on which 1 would like to reserve my opinion for a more appropriate time and occasion. For one thing, a true Islamic economy should. necessarily be inflation‑free and, as to Mr. Khaki's contention there are plenty of Islamic modes of finance to justify indulging, at this stage, in merely academic discussions."
Arabic‑English Lexicon by Lanes; 'Mufiadat ul‑Qur'an' by Imam Raghib al‑Isfehani;‑Taj‑ul‑Aroos Min'Jawahar‑ul‑Qamoos by Md. Murtaza al‑Zubaydi; Arabic English Dictionary by Stiengass; A dictionary of Islam from Thomas Patrick Hughes; Tafseer‑e‑Tabri by Imam Tabri; 'Kitab al?Nihayah fi‑Gharib al‑Hadith wa'1‑Athar' by Ibn al‑Athir; 'Ahkam al Qur'an' by Ibn 'Arabi's Tafsir of Kabir by Imam Fakhrud‑Din Al‑Razi; 'Ahkam al?Qur'an by AlJassas; al‑Fiqh ala al‑Madhahib al‑Arba'ah; II:265; XXIII:50: II: 276; XXX:39; XIII:17; XXVI:18; XVII:24; XII:5; XVI:92; LXIX:10; al‑Room XXX:39; Al‑Qur'an Majid: al‑Nisaa IV:160‑‑162; Aal‑e‑Imran III: 48‑‑50; Aal‑e‑Imran 111: 130‑‑136; al‑Baqarah II: 219, 261, 275‑‑277; 279‑?281; Luke 6: 32‑36; Abu Daud; XXXIX:53; Muslim, 2966; 2969, 2971; Tirrttizee, 1161; Bukhari, 2145; AI‑Musanif Abdur Razzaq, Vo1.8, p.26, Hadees. 14161; Kitab al Buyun; Exodus 22: 25‑27; Leviticus 25: 35‑38; Deuteronomy 23: 19‑20; Shorter Oxford Dictionary, VOl.II, p.2326, ''3rd Edn.; Messiah New Testament, Luke 6:35; A1 Burhan by Bahrani; Shorter Oxford Dictionary, Vol.l, 3rd Edn., p.1026; Encyclopaedia Americana, 1970; 39:53; Man and Money, published by the Institute of Islamic Culture, Lahore; S.IX:34‑35;,S.XXX:39; S.XXXIV: 39; S.LVIL 18; S.LXXVI: 8‑9; S.XC:, 13‑‑17; S.XCIII: 6‑‑11; II: 262‑‑265; S.II: 274; S.11: 277; S.XXIII: 1‑‑4; S. CVIL 1‑7; S.Il: 245; S. LXIV: 17; S. lI: 177; S.III: 14; S.LIX: 7; S:XVI: 95‑96; Bidayat al‑Mujtahid, Vo1.2, p.163; Al‑Tafseerul Kabir Razi, Vo1.7, p.91; Matba Bahria, 1938 and Ahkamul Qur'an by Imam Abu Bakar Al Jassas ref.
Per Justice Maulana Muhammad Taqi Usmani. Member‑‑‑
(aaaa) Islamic Jurisprudence‑‑‑
‑‑‑‑Riba‑‑‑Objective study of the Qur'anic verses dealing with Riba and their historical analysis tracing the time of prohibition of Riba.
AI‑Qur'an Majid: Surah Al‑Ruin (30 : 39); Surah Al‑Nisa (4:161); Surah Al‑Imran (3:13.0) and Surah AI‑Baqarah, Verses 275‑‑281 quoted.
Tafsir Jami'‑al‑Bayan, by Ibn Jarir, Dar‑ul‑Fikt, Beirut, 1984, V.21, pp.46‑‑48; Zad‑ul‑Masir by Iban‑al‑Jauzi, Al‑Maktab‑al‑Islami, Beirut, 1964,, V.6, p.304; Fath‑ul‑Bari by Ibn Hajar, Makkah, 1981, V. 8, p.205; Al‑Tafsir AI‑Kabir by AI‑Razi., IIIrd Edn.. Iran, V.9, p.2; AI‑Sunan by Abu Dawood, Hadith No.2537, V.3, p.20; Al‑Muharrar‑al‑Wajiz by Ibn Atiyyah, Doha, 1977, V.2, p.489; Jami‑al‑Bayan by Ibn Jarir, Op Cit., V.3, p.107, Alwasit by AI‑Wahidi, V.1, p.397; Ibn Atiyyah, Op. Cit., V.2, p. 489; Asbab‑al‑Nuzool by AI~Wahidi, Riyadh, 1984, p.87; Sahih Al‑Bukhari Kitab‑al‑Tafseer, Chap. 53, Hadith No.4544 and Fathul Bari by Ibn Hajar, V.8, p.205 ref.
(bbbb) Islamic Jurisprudence‑‑‑
‑‑‑‑ Riba‑‑‑Meaning‑‑‑Detailed account of Riba of Jahiliya‑‑‑Riba of Jahiliya is a loan given for a stipulated period against increase on the principal payable by. the loanee.
Al‑Qur'an Majid: Surah Al‑Nisa; Surah Al‑Imran; Surah AI?Baqarah; Tafseer Al‑Lubaab by Ibn Aadil AI‑Dimashaqi, Vo1.4, p.448; Al?Tafseer AI‑Kabeer by al‑Raazi, Vol. 7, p.91, published in Tehran; Tafseer Ibn Jarir, Vol. 3, p.101; fiafseer by Ibn Jarir, Op Cit, Vol. 3, p.101; Al? Suyuti, Lubab‑al‑Nuqool p.20; Tafseer ibn Abi Hatim, Vol. 2, p.454, Makkah, 1997 and Albahr‑al=Muheet by Abu Hayan, Vo1.2, p.335 ref.
Al‑Qur'an Majid: Deuteronomy 23:19; Psalms 15:1,2, 5; Proverbs 28:8; Nehemiah 5:7; Ezekiel 18:8,9 and Ezekiel 22:12 quoted.
(cccc) Islamic Jurisprudence‑‑‑
‑‑‑‑ Riba‑‑‑Description of Riba al‑Fadl with reference to the statements of Hadrat Umar, Imams and eminent Muslim Scholars on the subject.
Ahkamul Qur'an by Aljassas V. I, p.469; Holy Qur'an : Hand of Allah, 3:73, 5:63, 48:10; 2:223; Sahih Muslim, Karachi, V. p.25, Al‑ Dar?ul‑Kutub‑al‑Ilmiyyah by Ibn Qudamah Mughni, Beirut, V.4. pp.124‑‑127; Albukhari, Hadith No.5266; Almusnnaf by Abdurrazzaq, Beirut, V.8, p.26; Ibn Majah, Book 12, Chap.58, Hadith No.2276, Riyadh 1999 and Tahdhib?al‑Tahdhib by Ibn Hajar, V.4, pp.64‑65 ref.
(dddd) Islamic Jurisprudence‑‑‑
‑‑‑‑ Riba‑‑‑Riba Al‑Qur'an and Riba‑AI‑Nasiah‑‑‑Nature and their prohibition.
(eeee) Islamic Jurisprudence‑‑‑
‑‑‑‑Riba‑‑‑Productive and consumption loan‑‑‑Nature of Qur'anic prohibi?tions ‑‑‑Validity of such transaction of loan could not be based on the financial status of a party‑‑‑Permissibility of interest can neither be based on the financial position of the debtor, nor on the purpose for which money is borrowed‑‑‑Distinction between consumption loans and productive loans in this respect is contrary to the well‑established principles‑‑‑Banking and productive loans in the age of antiquity discussed.
Credit in Medieval Trade by Prof. M.M. Postan Combridge, 1944; Essays in Economic History, edited by E.M. Carus Wilson Edward Arnold, London, 1966, Vol.l, pp.61‑‑87; Encyclopaedia Britannica, Banks, History of, V.3, p.67,'1950 Edn.; Simon and Schuster, New York, 1966, Vo1.2, p.274, Chap. XII by Will Durant; Fall of Roman Empire, Chap.44, The Institutes IV, Vo1.2, p.90 by Gibbon; Al‑Balazuri, Fatooh‑al‑Buldan, pp.453‑354, Beirut, 1983 and Murooj‑al‑Zahab by Al‑Masoodi, Vol.2, p.333; Al‑Aghani by Abdulfaraj, VOl.II, p.52; The Dinars Polished in the Land of Ceazer; ; Luwais Shikhu, Christianity .and its Culture among the Jahili Arabs, V.ol, 2, p. 387; Surah Al‑Ikhlas Alnajoom Alzahirah 1:176; Sahih‑al‑Bukhari, Iitab‑al‑Manaqib, Book' 63, Chap.19, Hadith No.3814 and Al‑Baihaqi, Al‑Sunan‑al‑Kubra, Vo1.5, p.349 ref.
(ffff) Islamic Jurisprudence ‑‑‑
‑‑‑‑Riba‑‑‑Commercial loan‑‑‑Prohibition of Riba is not only restricted to the consumption loans but extends to the commercial loans also.
AI‑Qur'an, Surah Yousuf, 12:19,20; Suran Al‑Imran (3:130); The Bible: Genesis, 37:25; Almufassal fi Tarikh‑al‑Arab Qabal‑al‑Islam by Dr. Jawad Ali; Alzubaidi, Taj‑al‑Arus 6:44; Nihayah‑al‑Arab 17:81, Imta'‑al‑ asma', V.1, p.75, Cairo, 1981; Iittta‑al‑A5ma, Op. Cit.; Al‑Zurqani, Sharh?al‑Mawahib, V.1, :p.366; Al‑Mufassal fi Tarikh‑al‑Arab, V.7, p.290; Al?Tabari, Jami‑al‑Bayan, V.3, p.107; Al‑Abari, Jami‑al‑Bayan, V.21, p.47; Op. Cit.; Al‑Haithami; Majma'‑al‑Zawaid V.4, p.133; Al‑Bukhati, Book 39, Hadith No.2291; Fath‑al‑Bari, V.4, p.471; Trade through Sea, Book 34, Chap. 10, Hadith No.2063 by Imam Bukhari; AI‑Suhaili, Al‑Raud‑al‑Unuf, V.2, p.62, Multan, 1977, cf. Ibn Kathir: Al‑Seerah al‑Nabawiyyah, V.2, p.383, Tarikh‑ul‑Umam by Al‑Tabari, V.2, p.137; Kitab‑al‑Jihad by Sahib?al‑Bukhari, Book 7, Chap. 13, Hadith No.3129 and its Commentrary Fath‑al?Bari by Haifz Ibn Hahjar‑al‑Asqualani, V.6, p.162; AI‑Tabqat al‑Kubra by Ibn Saad, Beirut, V.3, p.278; Tarikh‑al‑Umam by AI‑Tabari, V.3, p.87, Events of the year 23 A.H.; Al‑Baihaqi, AI‑Sunan al‑Kubra, V.10, p.184; Al‑Tabaqaat by Ibn Saad? V.3, p.163; Kitab‑al‑Manaqib by Sahib‑al?Bukhari, Book 63, Chap.19. Hadith No.3814 and AI‑Tabaqaat al‑Kubra by Ibn Saad, V.3, p.358 ref.
(gggg) Islamic Jurisprudence‑‑‑
‑‑‑‑ Riba‑‑‑Prohibition‑‑‑Prohibition of Riba is not confined to an excessive rate of interest‑‑‑‑Any amount, however little, stipulated in addition to the principal in a transaction of loan, is Riba, hence prohibited‑‑‑‑Principles.
Al‑Qur'an Majid: Surah AI‑Imran (3:130); Al‑Muwatta, Bab‑al?Qirad by Imam Malik; Surah Al‑Baraqah 2:41; Al‑Noor 24:33; Tafseer Ibn Abi Hatim, V.2, p.551, Hadith No.2925; Tafseer Ibn Kathir, V.1, p.331; Al‑Shaukani, Nail‑al‑Awtar V.5, p.198; Muwatta Imam Maalik, p.613 by Noor Muhammad, Karachi; Op. Cit.; Albaihaqi, Al‑Sunan Al‑Kubra, V.5, p.350; Al‑Baihaqi, Al‑Sunan al-Kubra, V.5, p.350; Al‑Bahaiqi A1‑Sunan al?Kubra, V.5, p.350; AI‑Syuti, Al‑Jame'al Saghir, V.2, p.94; AI‑Munawi, Faizulqadir, V.5, p.28; Al‑Azizi, AI‑Siraj al‑Munir, V.4, p.20, Madinah; Ibn Hajar, Al‑Talkhis‑al‑Habir V.3, p.996, Haidth No.1227, Makkah 1997; Al‑Sunan al‑Kubra V.5, p.350 and AI‑Baihaqi, Ma'rifah‑al‑Sunan wa al? Athar, V.8, p.169 ref.
(hhhh) Islamic Jurisprudence‑‑‑
‑‑‑‑ Interpretation of Holy Qur'an‑‑‑Principles.
(iiii) Islamic Jurisprudence‑‑‑
‑‑‑‑ Riba‑‑‑Prohibition‑‑‑Gift by debtor to creditor ‑‑‑Permissibility‑‑?Conditions‑‑‑If the debtor and creditor 'Were on friendly terms with each other and it was their habit that one of them used to give a gift to the other, then this type of gift can be acceptable even after the recipient has advanced loan to the giver‑‑‑If, however, there were. no such terms between, the creditor and the debtor before the loan transaction, then the creditor should not accept same, because that will have a smell of Riba.
(jjjj) Islamic Jurisprudence‑‑‑
‑‑‑‑ Riba‑‑‑Ribd‑al‑Fadl and Bank loans ‑‑‑Ahadith on Riba Al fadl are meant to cover the transactions of sale only and have nothing to do with the transactions of loan which are covered by the rules of Riba Al‑Qur'an or Riba Aljahiliya where it clearly mentioned that creditor in a transaction of loan is entitled to claim only his principial amount, and if he does so, it has never been prohibited ‑‑‑Transaction of interest‑bearing loan fixing an amount as interest, right from the beginning of the transaction, is not covered by the prohibition of Riba Alfadl but by the Riba Al‑Qur'an‑‑?Banking interest being not a transaction‑of Riba Alfadl but that of a Riba Al? Qur'an, was, therefore, Haram‑‑‑Principles.
Sahih‑al‑Bukhari, Book No.34, Chap.78, Hadith No.2177; Aljassas: Akham‑ul‑Quran, Lahore 1980 V.1, pp.482, 483 and Al‑Sunan by Ibn Majah, V.3, p.154, Hadith No.2431, Beirut, 1996 ref.
(kkkk) Constitution of Pakistan (1973)‑‑‑
‑‑‑‑Art. 203‑B‑‑‑"Muslim Personal Law"‑‑‑Law‑‑‑Definition‑‑=Statute laws, even though applicable only to Muslims 111 general, do not fall under the term "Muslim Personal Law" for the purpose of Art. 203‑B of the Constitution.
Dr. Mahmoodurrahman Faisal v. The Government of Pakistan PLD 1994 SC 607 fol.
(llll) Islamic Jurisprudence‑‑‑
‑‑‑‑Riba‑‑‑Prohibition‑‑‑Basic cause of prohibitions ‑‑‑lllat‑‑‑Basic difference between Mat and Hikmat‑‑‑Zulm (injustice)‑‑‑Basic Mat of the prohibition is Zulm‑‑‑Holy Qur'an has not left it to the assessment of the parties to decide what is injustice (Zulm) and what is not ‑‑‑Qur'an has precisely decided. what is injustice (Zulm) for each one of the two parties in a transaction of loan‑‑?Notion that the permissibility of different transactions of interest should be judged on the basis of human assessment, would tantamount to defeating the very purpose of the revelation and is not, therefore, acceptable.
Al‑Qur'an Majid: 5:91 ref.
(mmmm) Islamic Jurisprudence‑‑‑
‑‑‑‑ Riba‑‑‑Prohibitions‑‑‑Rationale‑‑Logic of prohibition on theoratical ground; evil effects of interest on production and evil effects of interest on distribution examined with focus on nature of money and nature of loan transactions‑‑‑Interest‑based loans have a persistent tendency in favour of rich and against the interests of common people‑‑‑Such loan carries adverse effects on production and allocation of resources as well as on distribution of wealth‑‑‑Appalling situation faced by the whole world is the logical out?come of giving the interest‑based financial system an unbridled 'power to reign the economy‑‑‑Commercial interest is not an innocent transaction, in fact the universal horrors brought about by the commercial interest are far greater than the individual usurious loans that used to affect only some individuals.
Ihya‑al‑Uloom, V.4, pp.88‑89, Cairo, 1939; Ludwig Von Mises The Theory of Money and Credit Liberty Classics Indicanapolis, 1980, p.95; Op. Cit, P.95; Op Cit, p.102; The Report of Economic Crisis Committee, Southampton Chamber of Commerce, 1933, Part 3, (iii) para.2; John Gray, False Dawn; The Delusions of Capitalism, Grunte Books, London 1998, p.62; Bank of International Settlements, Annual Report, 1995; Michael Albert, Capitalism ‑ Original Capitalism, London Whurr Publisher, 1993, p.188; Richard Thomson: Apocalypse Roulette: The Lethal World of Derivatives, Macmillon, London 1998, p.4; James Robertson, Transforming Economic Life: A Millenial Challenge by Green Books Devon, 1998; Iha‑a‑ul‑Uloom by Alghazzali; Sahih‑al‑Bukhari, Book No.39, Chap,3, Hadith No.2295; OECD Structural Indicators, 1996, Bank of Enudand and Council for Mortgage Lenders Statistics, as quoted by Michael Rowbotham in The Grip of Death, Jon Carpenter Publishing, England, 1998, p.65; Peter Warburton Debt and Delusion by Allen Lane, London 1999, p.261; Thurow, Lester, Zero‑Sum Society by New York: Basic Books, 1980, p.175; Poverty, Inequality and Development by Bigsten, Arne, in Norman Gemmel Surveys in Development Economics Oxford by Blackwell, 1987, p.156; Morgan Guarantee Trust Company of New York, World Financial Markets, January, 1987, p.7 as quoted by Dr. llmar Chapra; Statistical Bulletin of State Bank of Pakistan, September. 1999, p.47, Annexure 'B'; Future Wealth: A New Economics for the 21st Century by James Robertson, Cassell Publications, London, 1990, pp. 130, 131; Transformation of Economic Life: A Millenial Challenge by James Robertson, Green Books, Devon, 1998, pp.51‑54; The Grip of Death, A Study of Modern Money by Michael Rowbotham, Jon Carpenter, England, 1998, Chaps. 13 to 15; The Money Masters by Patric S.J. Carmack and Bill Still, Royalty , Production Company, USA, 1998; Pawns in the Game by William Guy Carr, Fla USA Chap. 6; The New World Order by Robert O'Priscoll and Margarita Ivanoff‑Dubrowsky, Canada, 1993; Bank of England Releases, 1995,, 1997 as quoted by Michael Rowbotham in 'The Grip of Death ‑ A Study of Modern Money', Jolt Carpenter, England, 1998, p.131; The Money Masters, How International Bankers Gained Control of America by . Patriot S.J. Carmack and Bill Still, Royalty Production Company, 1998, pp:78‑79; The Grip of Death: A Study of Modern Money by Michael Rowbotham, Op Cit, pp.27, 2,8; The Challenge of the 21st Century by Prof. Khrushid Ahmad, Islamic Finance and Banking; Time, November, 3, 1997, Newsweek ‑ January 26, 1998 and September 14, 1998 and Transforming Economic Life: A Millenial Challenge by James Robertson, Grean Books Devon, 1998, pp.51‑‑54 ref.
(nnnn) Islamic Jurisprudence‑
‑‑‑‑ Riba ‑‑‑Prohibitions‑‑‑Interest and indexation ‑‑‑Interest and indexation though neither Justify interest nor provides a substitute for the same in the Banking transactions, however, question of interest and indexation was left open for further study and research by the Court.
(oooo) Islamic Jurisprudence‑‑‑
Riba‑‑‑Prohibitions‑‑‑Mark‑up system‑.‑Permissibility‑‑‑All the objections against interest are very much applicable to the mark‑up system as in vogue in Pakistan and said system is not immune from being declared as
repugnant to the Holy Qur'an and Sunnah.
(pppp) Islamic Jurisprudence‑
Riba‑‑‑Qarz and Qiraz‑‑‑Term "Qiraz" is used in Islamic Fiqh as a synonym to Mudarabah and in an agreement of Mudarabah no rate of profit attributable to the investment can be allocated for the financier‑‑‑Any such arrangement is impermissible.
(qqqq) Islamic Jurisprudence‑‑‑
‑‑‑Riba-Prohibitions‑‑‑Islamic Financial System‑‑‑Application of doctrine of necessity‑‑‑Scope‑‑‑Domestic transactions and foreign transactions‑‑?Before deciding an issue on the basis of necessity one has to be sure that the necessity is real and not exaggerated by imaginery apprehensions and that necessity cannot be met with by any other means than committing an impermissible act‑‑‑Held, there was a great deal of exaggeration in the apprehension that the elimination of interest will lead the economy to collapse‑‑‑Doctrine of necessity, therefore, cannot be applied to protect the present interest‑based system for ever or for an indefinite period‑‑‑Said doctrines, however, can be availed of for allowing a reasonable time to the Government necessarily required for the switch‑over to an interest‑free Islamic financial system.
(rrrr) Islamic Jurisprudence‑‑‑
-‑Financing in Islam‑‑‑Profit and loss sharing‑‑‑Basic and foremost characteristic of Islamic financing is, that instead of a fixed rate of interest, it is based oil profit and loss sharing.
Transforming Economic Life A Millenial Challenge by James Robertson, Green Book, Devon, 1998; Honest Motley: A Challenge to Banking by John Tomlinson, Helix 1993. pp. l l5‑I 18: The Grip of Death: A Study of Modern Money by Jon Carpenter, 1998 by Michael Rowbotham. p.330: Islamic Finance: A Partnership for Growth by Philip Moore, Euromoney Publishers, 1997, p.73: Theoretical Studio, in Islamic Banking and finance by Mohsin H. Khan and Abbas Mirakhor. Houston 1987, p. 168 and Debt and Delusion: Central Bank Follies That Threaten Economic Disaster by Peter Warburton, Allen Lane, 1999, pp.224‑225 ref.
(ssss) Islamic Jurisprudence‑‑‑
‑‑‑‑ Financing in Islam ‑‑‑Musharakah financing‑‑‑Some objections‑‑‑Measures to be adopted.
(tttt) Islamic Jurisprudence‑‑‑
‑‑‑Financing in Islam ‑‑‑Murabahah transaction‑‑‑Islamic Banking System is not restricted to profit and loss sharing ‑‑‑Musharakah is though the ideal mode of financing that fully conforms, not only to the principles of Islamic jurisprudence. but also to the basic philosophy of an Islamic economy, yet there is a variety of instruments that may be used on the assets side of the Bank, like Murabahah, leasing, Salam, Istisna etc.‑‑‑Some of these models :ire less risky and may be adopted where Musharakah has abnormal risks or is not applicable to a particular transaction‑‑‑Principles illustrated.
(uuuu) Islamic Jurisprudence ‑‑‑
‑‑‑‑Riba‑‑‑Financing in Islam‑‑‑Domestic loan obtained by Government‑‑?Suggestions for elimination of interest‑‑‑All the borrowings of the Government from domestic sources should be designed on the basis of project‑related financing, which will, in addition to being compatible with Shariah, help curbing the corruption arid misappropriation of borrowed Funds‑‑‑Interest cannot be taken as a necessity to continue for an indefinite period, however, area of domestic loan may justify some more time for transformation than the private banking transactions will require.
(vvvv) Islamic Jurisprudence‑
‑‑‑‑ Financing in Islam‑‑‑Foreign loans obtained by Government‑‑?Elimination of interest‑‑‑Doctrine of necessity, application of‑‑‑Scope‑‑?Admitted difficulties in resolving the problem of foreign liabilities cannot be taken as an excuse for exempting‑them from the prohibition for good or for an indefinite period on the basis of necessity‑‑‑Doctrine of necessity, therefore, will be applicable to a limited extent as it cannot be denied that it will take more time than the domestic transactions‑‑‑Principles.
The Debt Boomerang, How the Third World Harms us All by Susan George, Pluto Press, London, 1992; Faith and Credit, The World Bank's Secular Empire by Susan George, Fabrizio Sabelli, Penguin, 1998, p.141: When Corporations Rule the Earth by David Korten, 1993 as quoted by Michael Rowbtham: The Grip of Death by Michael Rowbotham, pp. 135, 137: The Debt Trap by Cheryl Payer, Monthly Review Press (1974) quoted by Rowbotham, Op Cit, p.137; No. IFC/P‑887, dated December 22, 1987, as quoted by the Report of the Prime Minister's Committee on Self?-Reliance, headed by Prof. Khurshid Ahmad, Islamabad, 1991 ref.
(wwww) Islamic Jurisprudence‑‑‑
‑‑‑‑ Riba‑‑‑Concept‑‑‑Any additional amount over the principal in a contract of loan or debt is the Riba prohibited by the Holy Qur'an termed as Riba‑al. Qur'an.
(xxxx) Islamic Jurisprudence‑‑‑
‑‑‑‑ Riba‑‑‑Riba‑al‑Sunnah‑‑‑Categories enumerated.
The Holy Prophet (p.b.u.h.) has also termed the following transactions as Riba:
(i) A transaction of money for money of the same denomination where the quantity on both sides is not equal, either in a spot transaction based on deferred payment. , (ii) A barter transaction between two weighable or measurable commodities of the same kind, where the quantity on both sides is not equal, or where the delivery from any one side is deferred.
(iii) A barter transaction between two different weighable or measurable commodities where delivery from one side? deferred.
These three categories are termed t~ the Islamic Jurisprudence as Riba‑al‑Sunnah because their prohibition is established by the Sunnah of the Holy Prophet (p.b.u.h.). Alongwith the Riba‑al‑Qur'an, these are four types of transactions termed as 'Riba' in the literature of Islamic Fiqh based on the Holy Qur'an and Sunnah.
Out of these four transactions, the last two ones. mentioned above ‑is (ii) and (iii) have not much relevance to the context of modern business, the barter business being a rare phenomenon in the modern trade. However, the Riba‑al‑Qur'an, and transaction of money mentioned above as (1) are more relevant to modern business.
(yyyy) Islamic Jurisprudence‑‑‑
‑‑‑‑ Riba‑‑‑Scope‑‑‑No difference exists between different types of loans so far as the prohibition of Riba is concerned‑‑‑Fact that additional amount stipulated over the principal loan or debt is small or large does not make any difference for the purpose of prohibition of Riba‑‑‑All the prevailing forms of interest, either in the banking transactions or in private transactions fall within the definition of "Riba"‑‑‑Any interest stipulated in the Government borrowings, acquired from domestic or foreign sources, is Riba and clearly prohibited by the Holy Qur'an‑‑‑Financial system, based on interest being against the Injunctions of Islam as laid down by the Holy Qur'an and Sunnah, has to be subjected to radical changes to bring the same in
conformity with Shariat‑‑‑Modes of financing as developed by Islamic Scholars. Economists and Bankers can serve as a better alternative to interest.
There is no difference between different types of loans so far as the prohibition of Riba is concerned. It also does not make any difference whether the additional amount stipulated over the principal loan or debt is small or large, Therefore all the prevailing forms of interest either in the banking transactions or in private transactions do fall within the definition of 'Riba'. Similarly, any interest stipulated in the Government borrowings, acquired from domestic or foreign sources is Riba and clearly prohibited by the Holy Qur'an.
The present financial system based on interest, is against the Injunctions of Islam as laid down by the Holy Qur'an and Sunnah, and in order to bring it in conformity with Shari'ah, it has to be subjected to radical changes.
A variety of Islamic modes of financing has been developed by Islamic Scholars, economists and bankers that may serve as a better alternative to interest. These modes are being practised by about 200 Islamic ?financial institutions in different parts of the world.
These alternatives being available, the transactions of interest cannot be allowed to continue for ever on the basis of necessity Many experienced bankers are unanimous on the point that Islamic modes of financing are not only feasible, but are also more beneficial to bring about a balanced and stable economy, for which they have produced detailed proof based on facts and figures. Some outstanding economists have supported this view in their detailed discourses.
There is ample evidence to prove that quite a substantial ground work has been done to suggest the strategy for the transformation of the existing financial system to the Islamic one and the present interest‑based system cannot be retained for an indefinite period on the basis of necessity. However, the transformation may take some time which can be allowed on that basis.
Dr. M. Aslam Khaki in person (in C.Sh. Appeal No. 1 of 1992).
Hafiz S.A.Rehman. Senior Advocate Supreme Court and Ejaz Muhammad Khan. Advocate‑on‑Record for ADBP.
Syed Riazul Hasan Gilani, Advocate Supreme Court and Kh. Mushtaq Ahmad Advocate‑on‑Record for ABL.
Noorul Arfin. Advocate Supreme Court, Mansoorul Arfin, Advocate Supreme Court and Abdul Saeed Khan Ghauri. Advocate‑on-?Record for UBL.
Khalid M. Ishaque, Senior Advocate Supreme Court for MCB, National Bank of Pakistan and State Life Insurance Corporation of Pakistan.
Abu Bakar Chundrigar. Advocate Supreme Court and M.S. Ghauri, Advocate‑on‑Record for HRL..
Ch. Muhammad Farooq, Attorney‑General for Pakistan (on notice, but slid not argue); Maulvi Anwarul Haq. Deputy Attorney‑General (at initial stage). Syed Riazul Hassan Gilani, Advocate Supreme Court (appeared froth 213‑6‑1999 to 2‑7‑1999 and thereafter did not appear despite notice to him); Ch: Zafar Iqbal, Advocate Supreme Court (appeared on behalf of the Federal Government but not argued), Ch. Akhtar Ali, Advocate‑on‑Record and Mehr Khan Malik ; Advocate‑on‑Record for Federation of Pakistan.
Ejaz Muhammad Khan, Additional Advocate‑General and M.A. Qayyum Mazhar, Advocate‑on‑Record for the State/N.‑W.F.P. Government.
Altaf Elahi Sheikh, Additional Advocate‑General, Punjab and Rao Muhammad Yousaf Khan, Advocate‑on‑Record for the State/Punjab Government.
Muhammad Iqbal Vehniwal, Advocate Supreme Court and Ch. Mehdi Khan Mehtab, Advocate‑on‑Record for Nawab Industries etc.
Respondent No. 1 in person (in S.A, No. 1 of 1992).
Muhammad Ismail Qureshy in person with Syed Abul Aasim Jaferi, Advocate‑on‑Record.
Syed Afzal Haider, Advocate Supreme Court (in S. As. Nos.96 to 102 of 1992,).
Dr. Waqar Masood Khan. Director‑General (Planning). International Islamic University' Islamabad. Dr. Syed Muhammad Tapir. International Islamic University, Abdul Jallbar Khan. firmer President, National Bank of Pakistan. Dr. Umar Chapra. Ibrahim Sidat, Dr. S. Muhammad Hussain, Dr. Irshad zaman, ('bartered Accountants/Economists, Maqbool Soomroo, Dr. Shahid Hussain, Abdul Wadood Khan, 'Hafiz Abdur Rehman Madni, Chairman Islamic Research Council, Dr. Aslam Khaki, Prof. Khurshid Ahmad. H.U Beg (Retired Finance Secretary, Government of Pakistan), Prof. Syed Nawaz Haider Naqvi. Muhammad Yahya (Deputy Secretary‑General. Mutahida Ulema Council of Pakistan Maulana Gauhar Rehman, Iqbal Khan (Foreign Expert Managing Director Global Islam Finance: HSBC Investment Bank Plc. United Kingdom). Dr. Ahmad Muhammad Ali (President, Islamic ?Development Bank, Jeddah) alongwith his delegation namely, Muad Ali Umar. (Vice‑Presedent. I.D.B.). Dr. M. Alfatah (Legal Adviser I.D.B.). D.M. Qureshi (Adviser Treasury. I.D.B.), Muhaad Al‑Jehri (Director, I.D.B.), Dr. Hussain Hassan (Head of Shariah Board, Dubai Islamic Bank) and Adrian A1 Bahr, Managing Director and Chairman, International Investment Company, Kuwait), Ismail Qureshi, Advocate Supreme Court. Faheem Ahmad (Marketing Coordinator, Financial Research and Analysis, Credit Rating Company Ltd., Pakistan, Karachi) and Maulana Abdul Sattar Niazi: Experts on Court's Notice.
Dates of hearing: 22nd to 26th February; 1st to 5th, 8th, 9th (Islamabad), 17th to 19th, 22nd to 26th (Karachi) March: 3rd to 7th, 17th to 21st, 24th to 28th, May; 14th to 18th, 28th, 29th, June; 1st, 2nd: 5th and 6th, July, 1999.
ORDER OF THE COURT
For the detailed reasons recorded in the three separate, judgments authored by Khalil‑ur‑Rehman Khan, J., Wajihuddin Ahmed, J. and Muhammad Taqi Usmani, J., it is hereby held that any amount, big or small, over the principal, in a contract of loan or debt is "Riba" prohibited by the Holy Qur'an, regardless of whether the loan is taken for the purpose of consumption or for some production activity. The Holy Prophet (p.b.u.h.) has also termed the following transactions as Riba:
(i) A transaction of money for money of the same denomination where the quality on both sides is not equal, either in a spot transaction or in a transaction based on deferred payment.
(ii) A barter transaction between two weighable or measurable commodities of the same kind, where the quantity on both sides is not equal, or where the delivery from any one side is deferred.
(iii) A barter transaction between two different weighable or measurable commodities where delivery from one side is deferred.
These three categories are termed in the Islamic jurisprudence as Riba‑al‑Sunnah because their prohibition is established by the Sunnah of the Holy Prophet (p.b.u.h.). Alongwith the Riba‑al‑Qur'an, these are four types of transactions termed ac 'Riba' in the literature of Islamic Fiqh based on the Holy Qur'an and Sunnah.
Out of these four transactions, the last two ones, mentioned above as (ii) and (iii) have not much relevance to the context of modern business, the barter business being a rare phenomenon in the modern trade. However, the Riba‑al‑Qur'an and transaction of money mentioned above as (i) are more relevant to modern business.
In the light of the detailed discussion above, there is no difference between types of loan, solar as the prohibition of Riba is concerned. It also does not make any difference whether the additional amount stipulated over the principal loan or debt is small or large. It is, therefore, held that all the prevailing forms of interest, either in the banking? transactions or in private transactions do fall within the definition of Riba. Similarly, any interest stipulated in the Government borrowings, acquired from domestic or foreign sources, is Riba and clearly prohibited by the Holy Qur'an. ?
The present financial system, based on interest, is against the Injunctions of Islam as laid down by the Holy Qur'an and Sunnah, and in order to bring it in conformity with Shariah, it has to be subjected to radical changes.
A variety of Islamic modes of financing has been developed by Islamic scholars, economists and bankers that may serve as a better alternative to interest. These modes are being practised by about 200 Islamic financial institutions in different parts of the world.
These alternatives being available, the transactions of interest cannot be allowed to continue for ever on the basis of necessity. Many experienced bankers, to name a few, such as Dr.Ahmad Muhammad Ali, President, Islamic Development Bank, Jeddah, Mr.Adnan al‑Bahr, Chief Executive International Investor, Kuwait, Mr.Iqbal Ahmad Khan, Chief Executive Islamic emit of the Hong Kong Shanghai Banking Corporation (HSBC) based in London from outside Pakistan and Mr.Abdul Jabbar Khan, the former President of the National Bank of Pakistan, Mr.Shahid Hasan Siddiqi and Mr.Maqbool Ahmad Khan from Pakistan are the bankers who have long experience of banking in different parts of the world, appeared before us. All of them were unanimous on the point that Islamic modes of financing are not only feasible, but are also more beneficial to bring about a balanced and stable economy and in support of this view material containing facts and figures was produced Some outstanding economists like Dr.Umar Chapra, the economic advisor Saudi Monetary Agency, Dr.Arshad Zaman, the former Chief Economist of the Ministry of Finance, Government of Pakistan, Prof‑ Khurshid Ahmad, Dr. Nawab Naqvi, and Dr. Waqar Masood Khan also supported this view in their discourses.
We have also gone through the detailed reports of the Council of Islamic Ideology submitted in 1980, the Report of the Commission for Islamization of Economy constituted in 1991, and the Final Report of the same. Commission, reconstituted in 1997 which was submitted in August, 1997. We have also perused the, report of the Prime Minister's Committee on self‑reliance submitted to the Government in April, 1991.
There is, thus, ample evidence to prove that quite a substantial ground work has been done to suggest strategy for the transformation of the existing financial system to the Islamic one, and the present interest based system need not be retained for an indefinite period on the basis of necessity. However, the transformation may take some time which can be allowed on that basis.
We now proceed to examine the provisions of the statutes in the context of the reasoning given in the impugned judgment.
This enactment confers power on the Court to allow interest to the creditor, upon all debts or ascertained sum payable which the Court gets recovered. The Federal Shariat Court has declared the Act repugnant to Injunctions of Islam as even the Council of Islamic Ideology had recommended its repeal in its Session held on 11th November, 1981.
The question of allowing interest by the Court while granting decree has been exhaustively dealt with by the Negotiable Instruments Act, 1881 and the Civil Procedure Code, 1908 as amended from time to time and as such there is no need to retain the Interest Act, 1839 on the Statute Book, so the same for this reason alone needs to be repealed. Even otherwise an undefined, naked and generalized power to allow interest on a debt is repugnant to Injunctions of Islam for the reasons already discussed above. We would, therefore, hold that Interest Act, 1839 being repugnant to Injunctions of Islam was rightly directed to be repealed.
II. The Government Savings Bank Act, 1873
This Act provides for nomination and payment of deposit on death of the depositor and such payment to be a full discharge‑ However, it provides for the savings of rights of executor and creditor etc.
Section 10, as challenged, reads as under:‑‑‑
"Any deposit made by, or on behalf of, any minor may be paid to him personally if he made the deposit, or to his guardian for his use if the deposit was made by any person other than the minor, together with the interest accrued thereon."
The provision, on account of the use of the word "interest" which is payable alongwith the amount of deposit was held as repugnant to Injunctions of Islam. Learned Judges of the Federal Shariat Court did not examine the nature of the amount, which is to accrue to the deposit made. If the accrual is caused through permissible mode of investment, obviously no objection can be taken. The emphasis should be on adoption of Islamic modes of finance and conduct of business following Islamic principles. We would, therefore, recommend that the word `interest' appearing in section 10 of the Act is repugnant to the Injunctions of Islam and shall be substituted with the words 'Shariah compliant return'.
III. Negotiable Instruments Act, 1881
The discussion on various provisions of the Negotiable Instruments Act, 1881 is contained in paragraphs 242 to 278 of the impugned judgment. Sections 79 and 80 of this Act, as amended, adopted the concept of "mark?up" system, which system as in vogue has been held to be repugnant to the Injunctions of Islam and the direction made is that the words "mark‑up" be deleted from the provisions of sections 79 and 80 of the Act. The opinion of one of us (Mr. Justice Maulana Muhammad Taqi Usmani) expressed in a booklet on the "mark‑up" system as is in vogue and is being practised in the banks and the effect of it is that it obviously amounts to Riba (interest prohibited in Islam, has been referred to. This opinion as quoted reads as under:‑----
So, what has been pointed out is that the practice adopted in the garb of "mark‑up" is violative of the conditionalities attaching to Bai‑Muajal as the permissibility of such a transaction is dependent on fulfilment of the above conditions. The other thing pointed. out is that change of heart and commitment to follow the Qur'anic Injunctions in letter and spirit is not only needed but is necessary for enforcement and implementation of the Islamic economic system. Neither lip service nor mere use of nomenclature will bring the desired change.
It is apparent that errors of omission and commission which crept into the PLS operation have been the cause for suggesting removal of "Bai' Mu'ajjal" from the list of permissible methods following the principle that anything leading to that which is prohibited stands itself prohibited. It is therefore, argued that anything which leads to "Ribs" must be foreclosed and disallowed. Jurists, it will be noted, have prescribed following conditions for the validity of Murabaha/Bai' Mn'ajjal:‑‑‑
(i) The time of payment of consideration must be known; and
| | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | Institution | Total Finance (US$MN) | | MURABAHA | MUSHARAKA | | | MUDHARABA | LEASING | | | OTHER MODES | | | Al Baraka Islamic Bank for investment | 119 | | 82 | 7 | | | 6 | 2 | | | 3 | | | Bahram Islamic Bank | 320 | | 93 | 5 | | | 2 | 0 | | | 1 | | | Faisal Islamic Bank Ltd | 945 | | 69 | 9 | | | 6 | 11 | | | 5 | | | Bangladesh Islamic Bank Ltd | 309 | | 52 | 4 | | | 17 | 14 | | | 14 | | | Dubai Islamic Bank | 1300 | | 88 | 1 | | | 6 | 0 | | | 6 | | | Fasial Islamic Bank Egypr | 1364 | | 73 | 13 | | | 11 | 3 | | | 0 | | | Jordan Islamic Bank | 574 | | 62 | 4 | | | 0 | 5 | | | 30 | | | Kuwait Finance House | 2454 | | 45 | 20 | | | 11 | 1 | | | 23 | | | Berrhard Islam? Malaysia Bank | 580 | | 66 | 1 | | | 1 | 7 | | | 24 | | | Qatar Islamic Bank | 598 | | 73 | 1 | | | 13 | 5 | | | 8 | | | Total (Ten Banks) | 8563 | | | | | | | | | | | | | Weighted Average????????????????????????????? | | 66 | | | 10 | 8 | | | 4 | 13 | | | | | | | | | | | | | | | | |
(ii) the seller has to possess the commodity involved before it is delivered to the purchaser.
The Council of Islamic Ideology in its report on the Elimination of Interest had approved the use of the mark‑up system, Bai' Mu'ajjal, to a limited extent in unavoidable cases in the process of switching over to an interest‑free system and warned against its wide or indiscriminate use in view of the danger attached to it viz. of opening a backdoor for dealings on the basis of interest. It is unfortunate that this warning was not properly Heeded and the system of mark‑up adopted in January, 1981 did not conform to the standard stipulations of Bai' Mur'ajjal. It is, however, pertinent to note that Bai'. Mu'ajjal/Murabaha is one of the most popularly used modes of financing used by the Islamic Banks in the world. The following table demonstrates that Murabaha is the most widely used mode of financing by the Islamic Banks. The weighted average of the share of that mode in total financing provided by Islamic Banks, as per data provided to the Bench by the Islamic Development Bank amounts to 66 per centum. A Table showing Distribution of Financing provided by Islamic Banks among the Various Modes Average during 1994‑1996, reads as under:‑‑‑
Table Missed 308
Murabaha mode of Finance or the "mark‑up" system with the conditions attached thereto is permissible mode of Islamic finance and this mode cannot, therefore, be held to he repugnant to the Injunctions of Islam if the conditions prescribed are not being practised by some of the parties. It is to be noted that such violations occurred as there was no monitoring system in existence to check such errors of omission and commission and H violations. In the system proposed to be adopted with Shariah Board in existence in the State Bank of Pakistan as well as in the financial institutions themselves, such violations as and when noticed shall be pointed out and eradicated. Moreover, such errors will be eliminated where the system as a whole will be geared up to enforce Islamic Laws with commitment and dedication. The adoption of the mark-up system within the limits prescribed appears m he the need of the economic system in the transitional period and till the time more and adequate number of Shariah‑compliant financing modes are developed In the light of the foregoing, let us examine the provisions of Negotiable Instruments Act, 1881 (hereinafter referred to as Act, 1881). , The first section hit by the aforesaid judgment is section 79 of the Act, 1881. which reads as follows:
"Subject to the provisions of any law for the time, being in force relating to the relief of debtors and without- prejudice to the provisions of section 34 of the Code of Civil. Procedure. 1908,‑‑‑
(a) when interest (or return in any other form) at a specified rate is expressly made payable on a promissory note or bill of exchange and no date is fixed from which interest (or return in any other form) is to be paid, interest (or return in any other form) shall be calculated at the rate specified, on the amount of the principal money due thereon. from the date of the note or? in the case of a bill, from the date on which the amount becomes payable, until tender or realization of such amount, or until the date of the institution of a suit to recover such amount;
(b) when a promissory note or bill of exchange is silent as regards interest or does not specify the rate of interest, interest on the amount of the principal money due thereon shall, notwithstanding any collateral agreement relating to interest between any parties to the instrument, be allowed and calculated at the rate of six per centum per annum from the date of the note, or; in the case of a bill, from the date on which the amount becomes payable, until tender or realization of the amount due thereon, or until the date of the institution of a suit to recover such amount:
Provided that in the case of alt amount due on an instrument where the return is on basis other than interest, the return on the amount due, when no rate of return is specified in the instrument, shall be calculated at the following rate:‑‑‑
(i) In the case of return on the basis of mark‑up in price, lease, hire?purchase or service charges, at the contracted rate of mark‑up, rental, hire or service charges, as the case may be; and
(ii) In the case of return on the basis of participation in profits and loss, at such rate as the Court may consider just and reasonable in the circumstances of the case, keeping in view the profit‑sharing agreement entered into between the banking company and the judgment‑debtor when the loan was contracted:
(c) notwithstanding the provisions of clauses (a) and (b), return on an amount due on an instrument where the return is on basis other than interest shall be allowed from the date it becomes due till the date it is actually paid.
The learned Federal Shariat Court has ordered that the provision of "Interest or return in any other form" in subsections (a) and (b) be deleted from these provisions. We agree with the learned Federal Shariat Court. Any return on a promissory note or a bill of exchange as contemplated in subsections (a) and (b) of section 79 is Riba and unlawful according to Shariah. Both these subsections are, therefore, held to be repugnant to the Injunctions of Islam as laid down in the Holy Qur'an and Sunnah.
However, Federal Shariat Court has not properly analysed the provision contained in clause (i) to the proviso of section 79 and as such the view recorded therein needs correction. Clause
(i) to the said proviso specifies different ways to calculate a return on a promissory note or a bill of exchange where they are based on mark‑up, leasing, hire‑purchase or service charge. The learned Federal Shariat
Court has based its judgment about this clause on the permissibility or otherwise of the transactions of mark‑up, leasing, hire‑purchase and service charge. Mark‑up' as in vogue, was held by the learned
Federal Shariat Court as invalid transaction, and, therefore, the wordmark‑up' was ordered to be deleted, while the same provision about leasing, hire‑purchase and service charge has been retained and not declared against Islamic
Injunctions.
A careful reading of section 79 with all its provisions, analyzed in the correct context would show that purpose of section 79 is not to validate or invalidate a certain return in the transactions of mark‑up, leasing etc. The basic purpose of clause (i) is that once a promissory note or a bill of exchange is drawn on the basis of these transactions, and the issuer of the note or of the bill could not pay their amount on the date of their maturity, the Court may order a certain return in favor of the holder of the note or the bill for the period in which the amount remained unpaid after its maturity.
Looked at from this perspective, this provision, in its present form is totally against the Injunctions of Islam, regardless of whether or not, the transactions underlying the instrument (mark‑up, leasing etc.) are in accordance with Shariah. The reasons are as follows:
Section 79 in the Act of 1881 was originally designed for the instruments of interest‑bearing loans or debts. The nature of interest is such that it is calculated on daily basis and keeps on increasing for the whole period of non‑payment. On the basis of this principle, Section 79 has visualized different situations where the amount of a note or a bill was not paid by the debtor on the stipulated date. Taking for granted that every day from the period of non‑payment must give the creditor an additional amount as interest or return, subsection (a) has provided that if the instrument has specified a certain rate of interest for the original period of loan, the same rate will be applied to the whole period of further non‑payment. Subsection (b) visualizes a situation where no rate of interest was specified in the instrument, either because the original transaction was free from interest, or because the amount of interest was built in the lump sum mentioned in the instrument. In this situation the rate of interest applied after maturity, has been fixed by law as six per cent. per annum.
When, in 1980, the Government announced the elimination of interest and the State Bank of Pakistan allowed some alternative modes of financing including mark‑up, leasing, hire‑purchase and service charge, some amendments were brought in certain laws. It is in this background that this proviso in section 79 was inserted, and the provisions relating to the notes and bills of exchange drawn on the basis of interest were applied to the transactions of mark‑up, leasing etc. in the manner specified in sub‑clauses of the proviso, without having regard to the fact that all these' transactions are essentially different from an interest‑based debt and they cannot be subjected to the same rules as govern the interest‑based instruments. Each one of these four transactions has its own peculiarities, and should have been dealt with differently.
Let us now analyse each one of these transactions separately. The first transaction mentioned in sub‑clause (i) is that of mark‑up in price. What is meant by this term is the transaction of Murabaha or `Bai' Mu'ajjal', the details of which have been explained in paras. above as well as in paras. 189 and 218 of judgment of Mr. Justice Muhammad Taqi Usmani. It has been mentioned there that this technique was suggested by the Council of Islamic Ideology but was distorted to the worst extent by the banks when they applied it in practical terms. The learned Federal Shariat Court, therefore, observed that "mark‑up system, as in vogue, is held to be repugnant to the Injunctions of Islam" (para. 262 of the judgment of the FSC) and consequently, it ordered that the words "mark‑up" be deleted from this sub- ?clause.
We have already held that although the mark‑up system as in vogue in our banks is repugnant to the Injunctions of Islam, yet it is not correct to assert that the transaction of Murabaha or Bai' Mu'ajjal in itself is prohibited:. If the transaction fulfils the necessary conditions spelled out above, it cannot be held repugnant to the Injunctions of Islam. But the reference of this transaction in this clause, in the context of a return on a promissory note or a bill of exchange is not according to the basic principle of a Murabaha transaction. The reason is that Murabaha or Bai' Mu'ajjal is a transaction of sale effected on the basis of deferred payment. One of the basic conditions of this transaction, like any other sale, is that the price is fixed at the time of the original contract of sale. This price may include a margin of mark‑up (profit) added on the cost incurred by the seller. To determine the amount of mark‑up, the seller may take different factors into consideration, including the deferred payment, but as already explained once the price is fixed, it will be attributable to the commodity and cannot be increased or decreased unilaterally, because as soon as the sale is accomplished, the price of the commodity became a debt payable by the purchaser. If this debt is evidenced by a promissory note or a bill of exchange, it is not different from a note or a bill evidencing a loan, and no return, whatsoever, can be charged over that note or bill, because it will amount to charging interest on the debt.
?Sub‑clause (i) of the proviso to section 79 provides that if the purchaser in a Murabaha or Bai' Mu'ajjal transaction did not pay the price, evidenced by a promissory note or a bill of exchange, a further return at the original rate of mark‑up shall be payable by the purchaser for the whole period within which the price remained unpaid after its maturity. For example A purchased a commodity for Rs. 100, B agreed to purchase it from him on a mark‑up of 10%. The commodity is, thus, sold to B for a price of Rs.110 to be paid after one year, say, on 31st January. A promissory note in the amount of Rs. 105 is signed by B in favour of A. Now, this promissory note is nothing but an instrument evidencing a debt payable by B to A, which includes the original mark‑up allowed by the Shariah. If B doesn't pay Rs. 110 to A on 31st January, sub‑clause (i) of the proviso to section 79 of the Act, 1881 provides that a further return on the same rate of mark‑up i.e. 10% in the above example, shall be payable by B to A for the whole period of non‑payment after 31st January. This provision is repugnant to the Injunction of Islam, because after the sale price becomes a debt, no return on it can be claimed by the seller from the purchaser. If the purchaser could not pay at the due date because of his poverty, the Qur'anic command is very clear that he should be given more time till he is able to pay. The Holy Qur'an says: ?? ?
And if lie (the debtor) is poor, he must be given respite till he is well‑off. (2:280)
However, if the purchaser has delayed the payment despite his ability to pay, he may be subjected to different punishments, but it cannot he taken to be a source of further `return' to the seller on per cent. per annum basis as contemplated in section 79. It is discussed in para. 51 of the judgment of Mr. Justice Muhammad Taqi Usmani that the following Qur'anic verse was revealed in the background of a similar transaction:‑---
We, therefore, agree with the finding of the Federal Shariat Court that the words "mark‑up price" occurring in sub‑clause (i) of the proviso of section 79 are repugnant to the Injunctions of Islam, but not because the transaction of mark‑up in itself is impermissible, but because after a sale is effected on the basis of mark‑up, and the price is evidenced by a promissory note or a bill of exchange, including the original mark‑up, no further return on the note or the bill is permissible in Shariah on the basis of the original mark‑up.
The second transaction mentioned in sub‑clause (i) is lease. The I learned Federal Shariat Court has held that lease being a permissible transaction, no change is necessary in this sub‑clause with regard to lease But, as observed earlier, the learned Federal Shariat Court did not attend to the fact that this clause is not meant merely to legalize? the transaction of lease. It goes further. It says that if the obligation to pay rental in a leas transaction is evidenced by a promissory note or a bill of exchange and, the amount of rent is not paid by the lessee at its due date, the note or the bill will automatically subject the lessee to the payment of a further return to the lessor at the same rate at which the original rent was contracted. Let its take a concrete example: A has leased an equipment to B on 1st February, 1999 for a period of five years. The aggregate amount of rent agreed between the parties is Rs. 1,00,000 to be paid in monthly instalments. B has signed a promissory note in the sum of Rs. 1,00,000 to be paid on 31st January. 2004. While fixing the rental, the lessor had amortized the cost of the equipment alongwith a margin of his profit at the rate of 5% per annum. If B does not pay the full amount of Rs. 1,00,000 up to 31st January. ?004, the sub‑clause (i) provides that A will be entitled to claim further return on the promissory note at the same rate of 5 % per annum that was taken into account while fixing the original rental, and thus, the debt will keep on increasing on daily basis until he pays off the full amount.
The correct position according to Shariah is that once the lessee has enjoyed the usufruct of the leased asset for the period of lease the amount of rent has become a debt due on him and it will be subjective to all the rules relevant to a loan or debt, and as mentioned in the case of mark‑up, if the lessee is unable to pay on account of his poverty, he will, have to be given further time according to the clear Qur'anic command and if he is purposely delaying the payment, he will be subjected to punitive steps. But his delay will not be taken as an automatic source of return to the lessor, as contemplated in clause (i).
It should be remembered, however, that if the lessee neither pays rent nor delivers the asset back to the lessor and keeps it in his possession even after the lease period, he will he subjected to the same rent as was fixed during the lease period for the days he kept possessing the asset, but it is on the basis of his further enjoying the asset after maturity and not for delaying the previous payable rent.
Hire‑Purchase
The third transaction mentioned in the said sub‑clause is hire‑' purchase. The learned Federal Shariat Court has commented on it as follows:--
"Another term used in this provision is hire‑purchase. Under this system banks may finance the purchase of these items under a Joint?-ownership arrangement with or without security. The would receive, in addition to repayment of the principal a share in the net rental value..."
We are afraid, the learned Federal Shariat Court did not define the agreement of hire‑purchase correctly and has confused it with the concept of 'diminishing partnership'. The correct nature of hire‑purchase is explained by Chitty in the following words:----
"A hire‑purchase agreement may be defined as an agreement under which an owner lets chattels of any description out on hire and further agrees that the hirer may either return the goods and terminate the hiring or elect to purchase the goods when the payments for hire have reached a sum equal to the amount of the purchase price stated in the agreement or upon payment of a stated sum. The essence of the transaction is, therefore, (i) bailment of goods by the owner to the hirer, and (ii) an agreement by which the hirer has the option to return or purchase the goods at some time or another. "
Chitty: On Contracts, Sweet and Maxwell, London, 24th Edition, 1977, v.2, p.461, para.3212.
This transaction, as practised in the market, has different forms, some of which may have elements not conforming to Shariah, but it is not the right place to go into these details. Even if the hire‑purchase is adopted as mentioned by Chitty in its purest form with no violation of a principle of Shariah, the question in the clause under discussion a not of the validity of the transaction in itself. The question here is one of payment of a `return' on the promissory note or a bill evidencing the obligation to pay rent in a hire?-purchase agreement. Therefore, it is subject to the same finding as recorded in the case of lease.
Service Charges
Next mentioned in clause (i) is the service charge. It is rightly held by the learned Federal Shariat Court that a service charge based on the actual (secretarial) expenses incurred by the financier in advancing a loan can be claimed by him from the borrower. This principle is derived from the following Qur'anic verse:
And the indebted person shall dictate (the document evidencing the' debt). (2:82)
Here the preparation of the document of loan has been held to be the responsibility of the borrower which naturally means that if this documentation involves some expenses, they will be borne by the borrower.
See Al‑Jassas: Ahkam al‑Qur'an. Lahore, 1980, v.1, p.485.
It lays down the principle that the expenses of secretarial nature in a transaction of loan can be claimed by the financier on condition that they are really based on actual expenses and are not a mere ruse for charging interest.
But again, the question in the clause in discussion is not whether service charge is or is not permissible. The clause contemplates that if the obligation of a service charge is evidenced by a promissory note or a bill, and its amount is not paid on the due date, the note or the bill will automatically obligate the debtor to pay a `return' on the note or the bill at the same rate as at which the original service charge was calculated.
It is now obvious that the service charge is allowed only on the basis of actual expenses and not on the basis of a `return' at a specific rate. The secretarial expenses in advancing a loan are normally incurred only at the beginning when the loans are advanced. They are included in the original service charge evidenced by the promissory 'note. These arc not normally recurring expenses, and if some additional expenses are incurred after the default through sending reminders etc. they are not necessarily at the same rate at which the original service charge was calculated. They can be less, and they can be more if the financier has to take a legal action against the borrower.
Sub‑clause (ii)
Now, we come to sub‑clause (ii) of the proviso of section 79 of the Act, 1881 which reads as follows:--
"'In the case of return on the basis of participation in profit and loss, at such rate as the Court may consider just and reasonable in the circumstances of the case, keeping in view the profit sharing agreement entered into between the banking company and the judgment‑debtor when the loan was contracted."
Proceeding on the assumption that this clause is speaking of profit and loss sharing, which is in conformity with Shariah, the Federal Shariat Court did not touch upon it here, but has expressly declared‑ about a paralleled provision in section 80 that it does not appear to be repugnant to the Injunctions of Islam. The clause, however, needs some clarification.
Firstly the words "when the loan was contracted" at the end of the clause are misleading. Financing on the basis of profit and loss sharing is not a loan. This word therefore, is misconceived.
Secondly the proportions of profit agreed to be distributed between the partners may be applicable as long as the Musharakah is not finally settled or liquidated, and so far this provision is correct. But the language used in the clause may cover a situation where a certain amount of profit is deserves by the financier after the liquidation and remained unpaid for a certain period. The words used in the clause may allow the financier to claim a further 'return' on the unpaid amount at the same rate at which the profit was declared for the financier. This is again objectionable, because if the business is totally liquidated and what remains with the client is only the amount which the financier is entitled to receive as a debt, any `return charged thereupon is not permissible, being interest charged on a debt.
The upshot of the above discussion is that even though the transactions of mark‑up, leasing, hire‑purchase, service charge and Musharakah are permissible subject to certain conditions, yet the way a, further 'return' on the pronote or a bill of exchange is provided in section 79, which contemplates a return over a debt is nothing but interest. It, i5, therefore, held that section 79 is repugnant to the Injunctions of Islam in its entirety. Although clause (ii) of the proviso of section 79 speaks of a Musharakah and a profit and loss sharing, this type of transaction does not? normally require a promissory note or a bill of exchange, because the rate of return in a Musharakah is unknown, and the pronote and a bill of exchange arc basically designed for a specific amount payable by the debtor. Therefore; retention of this truncated clause will make it applicable to a situation about which we have held that no further return is permissible in that situation. So far the amount of profit deserved by the financier remains in the business of the client a further return on the basis of actual profits accrued to the business will be deserved by the financier, but the provisions of the agreement of Musharakah can take care of it, its mention in the present context is not called for. The whole of section 79 is, therefore, held to be repugnant to the Injunctions of Islam.
Section 80
Section 80 of the Act of 1881 is almost analogous to section 79. The learned Federal Shariat Court has, therefore, subjected it to the same findings as recorded by it about section 79. We have the same comments on the findings of the learned Federal Shariat Court as detailed by us with regard to section 79. Like section 79, it is held that the whole of section 80 is repugnant to the Injunctions of Islam.
Sections 114 and 117 (c)
The learned Federal Shariat Court has also declared sections 114 and 117 (c) of the Act of 1881 as repugnant to the Injunctions of Islam, because both these provisions provide for interest.
Section 114 confers a right on the payer for honour of a bill of exchange to recover his paid amount alongwith interest from the original debtor. Similarly, section 117 (c) entitles an indorser who has paid the amount of the bill to recover it alongwith an interest at the rate of six per cent. per annum. Both provisions provide for charging of interest. The learned Federal Shariat Court has rightly declared them as repugnant to the Injunctions of Islam. The finding of the FSC about these provisions is upheld. However, it is to be noted that if a party has paid the amount due, inclusive of the interest payable on instrument prior to the date of coming into force of this judgment, the amount so paid by the payer for honour will in all fairness have to be allowed to be received by the party paying for honour.
Before parting with our discussion on the Act of 1881, we would like to observe that the definition of a "negotiable instrument" as given in section 13 does not, in itself, provide that it will be traded in, or that it will be transferred or indorsed at a discount. But the practice prevalent in the financial market is that it is discounted on the basis of interest. This practice is against the Injunctions of Islam and involves Riba. A promissory note or a bill of' exchange represents a debt payable by the debtor to the holder. This debt cannot be transferred to anybody except at its face value. Discounting of a bill or a note or a cheque, therefore, involves interest In an Islamic financial market, the papers representing money or debt cannot be traded. However, the papers representing holder's ownership in tangible assets, like shares, lease certificates, Musharakah certificates etc. cant be traded in, and a viable secondary market can be developed on that basis.
IV. The Land Acquisition Act, 1894
Sections 28, 32, 33 and 34 of the Land Acquisition Act, 1894 to the extent these contain the provisions relating to "interest" have been held, as per discussion contained in paragraphs 279 to 296 of the impugned judgment, to be repugnant to the Injunctions of Islam as laid down in the Holy Qur'an and Sunnah of the Holy Prophet (p.b.u.h.). Section 28 of the Land Acquisition Act reads as under:‑‑
"28. Collector may be directed to nay interest on excess compensation‑‑‑‑If the sum which; in the opinion of the Court, the Collector ought to have awarded as compensation is in excess of the sum which the Collector did award as compensation, the award of the Court may direct that the Collector shall pay interest on such excess at the rate of six per centum per annum from the date on which he took possession of the land to the date of payment of such excess into Court."
A bare perusal of section 28 manifests the intention of the provision i.e. to compensate the landowner who was deprived of the land without payment of the true price payable. The deprivation so made is sought to be calculated through the prescribed mechanism i.e. compensation is being assessed at the rate of 6 per cent. per annum difference of the amount payable for the period that the landowner was deprived of the usufruct of the land. The principle sought to be given effect is that an owner cannot be deprived of his property except by paying adequate and proper price/compensation thereof and that the rights' in the property are not to be treated as transferred unless proper compensation is not paid. Section 28 as amended/substituted for Balochistan by Baluchistan Act 13 of 1985 reads as under:‑‑
"In addition to the compensation fixed on the basis of market value as prevailing on the date of notification under section 4, an additional amount of fifteen per cent per annum of the compensation so fixed shall be paid from the date of the notification under section 4 to the date of payment of compensation. "
Similar provision for additional compensation was made in Sindh by adding/inserting section 28‑A after section 28 in the Land Acquisition Act by Sindh Ordinance No.23 of 1984.
Section 32 of the Land Acquisition Act reads as under:‑‑---
"32. Investment of money deposited in respect of land belonging to persons .incompetent to alienate‑‑(I) If any money shall be deposited in Court under subsection (2) of the last preceding section and it appears that the land in respect whereof the same was awarded belonged to any person who had no power to alienate the same, the Court shall‑‑‑
(a) order the money to be invested in the purchase of other lands to be held under the like title and conditions of ownership as the land in respect of which such money shall have been deposited was held, or
(b) if such purchase cannot be effected forthwith, then in such Government or other approved securities as the Court shall think fit;
and shall direct the payment of the interest or other proceeds arising from such investment to the person or persons who would for the time being have been entitled to the possession of the said land, and such moneys shall remain so deposited and invested until the same be applied‑
(i) in the purchase of such other lands as aforesaid; or
(ii) in payment to any person or persons becoming absolutely entitled thereto.
(2) In all the cases of moneys deposited to which this section applied the Court shall order the costs of the following matters, including therein all reasonable charges‑and expenses incidental thereto, to b.: paid by the Collector, namely:‑‑
(a) the costs of such investments as aforesaid;
(b) the costs of orders for the payment of' interest or other proceeds, of the securities upon which such moneys are for the time being invested, and for the payment out of Court of the principal of such moneys, and of all proceedings relating thereto, except such as may be occasioned by litigation between adverse claimants."
This section regulates the amount of compensation which for the reasons given in the previous section i.e. section 31 of the Land Acquisition Act could not be paid to the rightful owner. Such amount lying with the Court is to be invested in the purchase of other land to be held under the like title and conditions of ownership as the land in respect of which such money has been deposited was held, or if such purchase cannot be effected forthwith, then in such Government or other approved securities. This section further provides that the interest or other proceeds arising from such investment shall be paid under the direction of the Court to the person/persons who are found entitled to the possession of the land acquired.
Then comes section 33, which reads as under:‑‑‑
"33. Investment of money deposited in other cases.‑‑‑When any money shall have been deposited in Court under this Act for any cause other than that mentioned in the last preceding section, the Court may, on the application of any party interested or claiming an interest in such money, order the same to be invested in such Government or other approved securities as it may think proper, and may direct the interest or other proceeds of any such investment to be accumulated and paid in such manner as it may consider will give the parties interested therein the same benefit therefrom as they might have had from the land in respect whereof such money shall have been deposited or as near thereto as may be."
This section provides for regulation of the money deposited in the Court for any cause other than the one mentioned in section 32 of the Land Acquisition Act and provides that such money deposited with the Court is to be invested in Government or other approved securities and the interest or the proceeds of any such investment are to be paid to the person/persons found entitled on the basis of their interest in the land and their entitlement to receive benefit from the land in respect of which the money had been deposited.
Section 34 may now be taken up. This section, as originally enacted was as under:‑‑‑--
"34.Payment of interest. ‑‑‑When the amount of such compensation is not paid or deposited on or before taking possession of the land, the Collector shall pay the amount awarded with interest thereon at the rate of six per centum per annum from the time of so taking possession until it shall have been so paid or deposited."
This section as amended by West Pakistan Act III of 1969 substituting the words "interest thereon at the rate of six per centum" with the words "Compound interest at the rate of eight per centum" and adding a proviso thereto was reproduced in the impugned judgment, in the following words:‑‑--
"34. Payment of interest. ‑‑‑When the amount of such compensation is not paid or deposited on or before taking possession of the land, the Collector shall pay the amount awarded with compound interest thereon at the rate of eight per centum per annum from the time of so taking possession until it shall have been so paid or deposited:
Provided that any waiver of the above right by the landowner shall be void and he shall be entitled to the said interest notwithstanding any agreement to the contrary."
Section 34 was omitted altogether from the Land Acquisition Act as regards its application in Province of Balochistan vide Balochistan Act XIII of 1985 (section 11). It is further to be noted that both these amendments in section 34 were. made not applicable to the Province of Sindh vide Land Acquisition (West Pakistan Amendment) (Repeal) Ordinance, 1971 (Ordinance VI of 1971). As for N.‑W.F.P., vide N.‑W.F.P. Ordinance (V of 1983) in the Land Acquisition Act, 1894, for section 34, the following section was substituted:‑‑
"When the amount of such compensation is not paid or deposited on or before taking possession of the land, the Collector shall pay the amount awarded with simple interest thereon at the rate of' six per centum per annum from the time of so taking possession until it shall have been so paid or deposited."
It appears that learned Judges of the Federal Shariat Court were not assisted properly by presenting before them the provisions of section 34 as amended and in force in the four Provinces. This section as amended came under consideration before the Peshawar High Court and the Lahore High Court. In the case of Government of N.‑W.F.P. through Collector, Land Acquisition, Nowshera v. Muhammad Sharif Khan (PLD 1975 Peshawar 161), learned Judges of the Peshawar High Court observed that the amount of compensation includes the amount payable in consideration for compulsory acquisition by way of interest. In Islamia University, Bahawalpur through its Vice‑Chancellor v. Khadim Hussain and 5 others (1990 MLD 2158 ‑ Lahore), learned Judges of the Lahore High Court observed, "that the right to receive the interest under sections 28 and 34 is a right to receive the compensation on account of deprivation of one's land under compulsory acquisition proceedings under the Act. The award of interest is neither a repayment of additional amount on loan nor it is an accretion on compensation in favour of landowner on account of loss of land under coercive statutory proceedings. It is in fact giving an equivalent or a substitute of equal value. It is in fact "that compensation" by which an injured party is restored to its formal position". This second case was noticed in the impugned judgment.
This Act, as noted in the impugned judgment, came up for consideration before the Council of Islamic Ideology for the first time in its meeting held on 19‑10‑1976 and the Council observed as under:‑‑
It again came up for consideration before the Council of Islamic Ideology on 14‑3‑1982 under the Chairmanship of Dr. Tanzil‑ur‑Rahman, J., as he then was, wherein the following opinion as regards these sections was expressed:‑‑
"The acquisition of land is against awarding compensation to the landowner or persons holding interest therein. The various steps taken in this direction, being procedural, do not seem to offend any provision of Islamic Law. The provisions regarding `interest' as contained in sections 28, 32 and 34 are in conflict with Shari'ah."
It is further noted in the impugned judgment that the Council of Islamic Ideology agreeing with the above opinion resolved that the Land Acquisition Act should be amended accordingly.
This Act (Land Acquisition Act) was also considered by the Federal Shariat Court in S.S.M. No. 14/P of 1983 and judgment was delivered by it on 27‑3‑1984. The said judgment was set aside by the Shariat Appellate Bench of the Supreme Court in Shariat Appeal No.22 of 1984 and the matter was remanded to the Federal Shariat Court vide judgment of this Court dated 13‑I‑1988 for fresh decision. The remand matter came up before the Full Bench of the Federal Shariat Court on different dates and the same was adjourned from day to day and was still pending when the impugned judgment was delivered by the three learned Judges of the Federal Shariat Court.
It is pertinent to note that the contention of the learned counsel for the Federation was that the amount of compensation awardable under sections 28 and 34 of the Land Acquisition Act represents the compensation on account of deprivation of the land under compulsory acquisition proceedings and so does not qualify to be treated as 'Riba' as laid down by the Holy Qur'an and Sunnah of the Holy Prophet (p.b.u.h.) and in support of this contention reliance was placed on the judgment of the Lahore High Court (1990 MLD 2158) wherein notice was also taken of the three judgments of the High Courts of Allahabad, Patna and Madras rendered before partition. Learned Judges of the Federal Shariat Court surveyed these judgments and commenting on Behari Lal's case observed that the considerations which weighed with the Courts to determine whether interest or damages could be classified as taxable income within the purview of Income Tax Act were different from the criteria to be employed for ascertaining whether interest payable under sections 28 and 34 is Riba. Therefore, it would appear inappropriate to apply the tests of finding out a sum to be income under the income Tax Act for judging it ‑to be Riba or otherwise. The true tests for adjudicating the real nature of an amount in the domain of Riba can come from the Holy Qur'an. Sunnah of the Holy Prophet (p.b.u.h.) and time tested opinions of the jurists and scholars well versed in Islamic Law and Shari'ah. Consequently, the process of reasoning employed in the judgments for dubbing the interest payable under sections 28 and 34 to be something else than Riba is difficult to justify in Shari'ah. The increase or addition in the form of interest under sections 28 and 34 over the debt payable in the form of compensation by acquiring authority to the land‑owners obviously falls in the category of Riba".
As regards section 32 of the Land Acquisition Act which provides for investment of the amount of compensation deposited with the Collector either in purchase of the land or other approved securities, it was observed that the said securities should be those which are non‑interest bearing. To this view obviously no objection can be raised as the financial institutions have schemes and securities which are non‑interest bearing and the Courts while making directions should regulate the investments in Shariah Compliant Modes of Finance.
Learned Judges of the Federal Shariat Court also noticed the judgment of this Court in Qazilbash Waqf and others v. Chief Land Commissioner, Punjab, Lahore and others (PLD 1990 SC 99) to the effect that the third condition of compulsory acquisition/purchase is that compensation is to be paid either before taking over the possession or within such period that cannot be considered to be delayed payment but under section 13 this payment has been ordered to be made bearing bonds. The principle, thus, deducible from this observation is that the payment of the price of the land has not only to be adequate and properly counter‑valued but also to be made before or simultaneously with taking over of the possession of the land purchased or otherwise if the payment is not so made, the same is required to be made within reasonable time which cannot be termed as delayed payment.
The question requiring determination is whether sections 28 and 34 of the Land Acquisition Act are based on such a concept. The judgments of Peshawar High‑Court and the Lahore High Court noted above have taken the view that the compensation which the Court has been empowered to award under these two sections is compensation on account of deprivation of the use of the land and does not fall within the definition of 'Riba' as contemplated by Holy Qur'an and Sunnah of the Holy Prophet. The three Indian cases noticed in the impugned judgment under the Income‑tax Law also held the amount received on account of interest as compensation and damages for loss of right to retain possession of the property. It was further observed in Allahabad High Court's case [Behari Lal Bhargava v. Commissioner of Income‑tax, C.P. and U.P. (AIR 1941 Allahabad 135)[ that section 28 of the Land Acquisition Act was designed as convenient method of measuring such damages in terms of interest. In the Patna High Court's case [Commissioner of Income‑tax, Bihar and Orissa v. Rani Prayag Kumari Debi (AIR 1939 Patna 662)[ it was held that the amount received by the assessee by way of damages is not income amenable to assessment under the Income‑tax Act, 1922. Though it came to the conclusion, in the peculiar circumstances of the case, that the amount was not income but merely an amount received on account of damages for the detention of the properties was also not accepted. In the Madras High Court's case [Revenue Divisional Officer, Trichinopoly v. Venkatarama Ayyar and another (AIR 1936 Madras 199, wrongly noted as AIR 1932 Madras 199, in the judgment of the Federal Shariat Court)] it was observed that right to receive interest under section 34 of the Land Acquisition Act took the place of the right to retain possession and that the foundation of the Land Acquisition At was that when compensation was payable and had not been paid, interest for non‑payment must be given from the date of taking possession.
Learned Judges of the Federal Shariat Court in the impugned judgment have not accepted the aforesaid pleas for the reason that it is inappropriate to apply test of finding out a sum to be income under the Income‑tax Act for judging it to be Riba or otherwise as the real test is one which is provided by Holy Qur'an and Sunnah of the Holy Prophet (p.b.u.h.). It was held in the impugned judgment that increase or addition in the form of interest under sections 28 and 34 over the debt payable in the form of compensation by acquiring authority to the landowners falls in the category of Riba.
The nature and purpose of the payment of additional amount under both the sections merits in our view further consideration. The reasoning given in the Allahabad case (AIR 1941 Allahabad 135) which is also the basis of the judgment delivered in Madras case (AIR 1936 Madras 199) came to be considered by the Indian Supreme Court in the case of Dr.Sham Lai Narula v. The Commissioner of Income‑tax, Punjab Jammu and Kashmir, Himachal Pradesh and Patiala (AIR 1964 SC 1878) and was specifically overruled. The reasoning recorded by the Supreme Court of India is as follows:‑‑‑-
"S.34. Land Acquisition Act itself makes a distinction between the amount awarded as compensation and the interest payable on the amount so awarded. The interest has to be paid on the amount awarded from the time the Collector takes possession until the amount is paid or deposited. A perusal of the provisions of section . 23 shows that interest is not an item included in the compensation for any of the matters mentioned therein; nor it is mentioned as a consideration for the acquisition of the land. Under clause (2) of section 23, the Legislature in express terms states that in addition to the market value of the land the Court shall in every case award a sum of 15 per cent. of such market value in consideration of the compulsory nature of the acquisition. If interest on the amount of compensation determined under section 23 is considered to be a part of the compensation or given in consideration of the compulsory nature of the acquisition, the Legislature would have provided for it in section 23 itself. But instead, payment of interest is provided for separately under section 34 in Part V of the Act under the heading `Payment'. It is so done, because interest pertains to the domain of payment after the compensation has been ascertained. It is a consideration paid either for the use of the money or for forbearance from demanding it after. It has fallen due. Therefore, the Act itself makes a clear distinction between the compensation payable for the land acquired and the interest payable on the compensation awarded. "
This judgment was followed by the Supreme Court of India in AIR 1970 SC 1702 and AIR 1972 SC 260.
Learned Judges of the Federal Shariat Court were right in observing that the test of finding out whether a sum is income under the Income‑tax Act cannot be applied for determining the nature of the said amount to be Riba or otherwise. This question, as pointed out in the impugned judgment itself is to be answered according to the touchstone of the principles deduced by the jurists and scholars in Islamic Law and Shariah. The first principle applicable is that in case of compulsory: acquisition the compensation or the value of the land and the property acquired is to be paid either before taking over of the possession of property or simultaneously with the taking over of the possession or within such period of time after taking over of possession that the time involved may not be considered as real (mentionable) delay in making payment. If there is any delay, then it will be considered and treated that interest in the ownership of the land to that extent has not been passed. This is so treated so as to impress upon the necessity of making of the payment of the due price/counter‑value and it is for this reason that section 28 of the Land Acquisition Act provides for awarding an amount with reference to the amount of compensation which was less paid or assessed or fixed by the Collector.
From the viewpoint of Shariah, the acquisition is a compulsory purchase of a property from the owner and the compensation awarded to him is the price of such purchase. One of the necessary conditions of a permissible acquisition, as laid down by this Court in the case of Qazalbash Waqf v. Chief Land Commissioner (PLD 1990 SC 283) is that the owner is given a fair market price of the property before or at the time of taking possession. If the Collector has paid less than the fair market price, it means that he has compelled the owner, not only to surrender his property without a fair price, but also to face the hardships of litigation. The function of the Court in this case is to fix a fair price of the property. While discharging this function the Court can take into consideration the injustice done to and the hardships suffered by the owner of the property and may, thus, increase the price so as to make it more than the normal market price. Instead of adopting this simple mode, section 28 of the Act, 1894 has first fixed the price by specifying the `excess", then it has allowed an additional amount in the name of interest at the rate of 6% per annum. That is why the Federal Shariat Court has declared it repugnant to the Islamic Injunctions; because once the price is fixed and it became a debt, any increase over it calculated at per cent. per annum basis makes it interest, hence prohibited. On the contrary, if the price itself is increased for the considerations mentioned above, it will not entail interest, because the price of a property may be fixed on the basis of many considerations, including the hardship suffered by the seller at the hands of the purchaser in the same transaction.
Hence, awarding of compensation and the mechanism adopted in original section 28 as well as provided in Provinces of Punjab, Sindh and N.‑W.F.P. is objectionable from Sharjah point of view. This section as is enacted in Baluchistan vide section 9‑A, Baluchistan Act 13 of 1985 also does not provide permissible mechanism to allow proper and adequate compensation. These sections shall be substituted by a provision to the following effect:‑‑‑
"In addition to the compensation fixed on the basis of market value as prevailing on the date of notification under section 4, an additional, sum at the rate of fifteen per centum per annum (or the rate fixed from time to time) of the compensation so fixed shall be added to the compensation due and payable from the date of notification under section 4 till the date of payment of compensation finally. "
As regards section 34, the amount awarded, as rightly observed in the Indian Supreme Court judgments, is not compensation paid to the owner for depriving him of his right to possess the land acquired but is given to him for‑ deprivation of the use of money representing the compensation for the land acquired and as such is "interest" paid for the delayed payment of the compensation amount.
As in the case of section 28, the finding of the learned Federal , Shariat Court about this section is justified with regard to the language used and the manner ,specified for imposing an additional amount over the original awarded amount. But, while correctly analysing the nature of this additional amount we should not overlook the fact that the landowner has been deprived of the possession of his rightfully owned property without any compensation. As we have already mentioned in our discussion on section 28, acquisition from the point of view of Sharjah is a compulsory purchase by the Government. One of the basic conditions for the validity of such a compulsory purchase, as held by this Court in the case of Qazalbash Waqf v. Land Commissioner (PLD 1990 SC 283) is that the fair market price is given to the landowner before or at the time of taking possession or immediately after it. It means that a valid sale, in the case of acquisition, takes place only when the price is actually paid by the Government to the landowner. Taking possession without the payment of the price, in the case of acquisition, does not in itself amount to effecting a valid sale. The land?owner, therefore, is entitled to claim a rent for the period commencing from the date of possession to the date of the payment of the price (the awarded amount) whereby the actual valid sale shall have taken place. This rent should not be less than the fair market rent in the relevant period.
What is wrong in section 34 is, firstly, the use of the word `interest' and secondly, determining the rate of eight per cent. per annum, with no fegard to the rental value of the acquisitioned property. However, it may be provided that the landowner shall be paid the fair rental value, or an amount equal to 8 % per annum of the awarded amount, whichever is higher, from the time of taking possession to the time when the amount of l compensation is actually paid to him.
With these observations and the direction noted above the judgment of the Federal Shariat Court with regard to Land Acquisition Act, 1894 is upheld.
V. Code of Civil Procedure, 1908
The provisions of Code of Civil Procedure wherein the word "interest" appears have been discussed in paragraph 297 to paragraph 311 of the impugned judgment. In paragraph 304 it is mentioned that the Sharjah position in relation to interest, mark‑up, lease, hire‑purchase and service charges has been dealt with while examining the provisions of Negotiable Instruments Act, 1881 and the same observations do equally apply to the provisions of the Code of Civil Procedure. Sections 34(1) & (2), 34‑A (1) & (2) and 34‑B(1)(a) of the Code of Civil Procedure were declared repugnant to the Injunctions of Islam following the discussion on the question of prohibition of the interest.
Section 34, provides that where a decree is for the payment of money, the Court may, in the decree, order "interest" at such rate as the Court deems reasonable to be paid on the principal amount adjudged, from the date of the suit to the date of the decree, in addition to any interest adjudged on such principal sum for any period prior to the institution of the suit, with further "interest" at such rate as the Court deems reasonable on the aggregate amount so adjudged, from the date of the decree to the date of payment, or to such earlier date as the Court thinks fit.?
Section 34‑A has been newly added by Ordinance X of 1980. It deals with interest on public dues. It provides that where the Court is of opinion that a suit was instituted with intent to avoid the payment of any public dues payable by the plaintiff or on his behalf, the Court may, while dismissing such suit, make an order for payment of `interest' on such public dues at the rate of two per cent., above the bank rate.
Subsection (2) of section 34‑A deals with a different situation. It provides that if the Court is of opinion that the recovery of any public dues from the plaintiff was unjustified, the Court may, while disposing of the suit, make an order for payment of interest on the amount recovered at the rate of two per cent., above the bank rate.
Section 34‑B has been newly added by Ordinance LXIII of 1980: It deals with interest on dues of a Banking Company. It provides that where a decree is for payment of money due to a Banking Company in repayment of a loan advanced by it, the Court shall, in the decree, provide for interest or return, as the case may be, on the judgment debt from the date of decree till payment. It further provides that in case of interest‑bearing loans, the Court shall award a decree for interest at the contracted rate or at the rate of two per cent. above the bank rate, whichever is the higher. ??????????? ?
Clause (b) of the said section provides that in the case of loans given on the basis of mark‑up in price, lease, hire‑purchase or service charges for the contracted rate of mark‑up, rental hire or service charges, as the case may be, the Government shall provide for interest or return at the contracted rate or at the latest rate of the Banking Company for similar loans, whichever is higher.
Clause (c) of section 34‑B provides that in the case of loans given on the basis of participation in profit and loss, for return at such rate, not being less than the annual rate of profit for the preceding six months paid by the Banking Company on term deposits of six months accepted by it on the basis of participation in profit and loss, the Court shall in the decree provide for such return and at such rate, not less than the annual rate of profit for the preceding six months as stated above, which the Court ma consider just and reasonable in the circumstances of the case.
Section 34‑B (b) and (c) relates to the recovery of money owed to a Banking Company by a client who entered into a transaction of mark‑up, leasing, hire‑purchase, service charge or profit and loss sharing. The learned Federal Shariat Court has subjected these provisions to the same comment as it has made in relation to sections 79 and 80 of the Negotiable Instruments Act. We have already explained the shortcoming in the finding of the Federal Shariat Court in this respect while discussing sections 79 and 80 of the Negotiable Instruments Act. The same comments are applicable here with greater force, because these provisions of the Code are meant in more express terms for the recovery of the previous obligations.
Consequently, subsections (b) and (c) of section 34‑B of the Code are hereby held to be repugnant to the Injunctions of Islam.
?The provisions of sections 34 and 34‑A conferred a power on the Court to grant additional sum over and above the decreed amount and the sums to be allowed have been named as interest. We have already held that any amount over and above the principal amount of debt is Riba, hence prohibited. Therefore, any additional amount contemplated in these provisions does fall within the definition of `Riba'. However, it is appropriate at this stage to take due notice of some of the submissions emphatically canvassed by the economists and bankers, particularly of Mr. Muhammad Umar Chhapra and Mr. Shahid Siddiqui to the effect that no banking system can successfully operate and particularly the Islamic Finance if the lending institutions, corporate bodies, firms and individuals do not on their own abide by their commitments in time in making repayments and are not otherwise made to repay financial assistance/loan received by them according to the agreed upon time limit. They emphasized that recovery system through legal means and Courts should necessarily be so designed as to make possible recovery within weeks. Mr. Chhapra was of the view that if the repayment schedule is not adhered to by the borrowers themselves or they are not made to abide by the repayment schedule by the legal system and the Courts, Islamic Finance cannot flourish and that is why the moral hazard involved in the Islamic economic system has to be taken care of by the law Courts. Mr.Shahid Siddiqui in his address submitted that firstly the borrowing is to be resorted to by a Muslim as a last resort as otherwise Islamic economic system contemplates for other arrangements like Masharaka, Mudarabah and profit and loss sharing systems for growth of business and industry. He added that veil of incorporation should not be allowed to be used as a shield to commit fraud and avoid the liabilities incurred. The concept of a company being a separate and independent entity has to be curtailed in its scope and the persons forming that legal entity have to be held responsible for the failure of the business concern, company or the venture, and the representation made in the feasibility reports and other allied documents, on consideration of which the financial assistance was received should be taken on the failure of the business of the venture to be fraudulent and false representations entailing penal consequence under the penal law of the land. He argued that the burden should be on the persons forming the ostensibly failed venture to prove that the representations made by them in feasibility reports and other documents were true and that the failure was on account of factors beyond their control as otherwise such defaulters after devouring national wealth would continue to flourish inside and outside the country as is the case of the present defaulters of banks and financial institutions. The religious scholars as well as the economists can provide such legal measures which will make the recovery of the dues from the defaulters effective as well as timely.. They pointed out that the Holy Prophet (p.b.u.h.) did not join Sala‑tul‑Janazah of a person who died leaving his debt unpaid. It is for such a reason that at the Janazah prayer, legal representatives of a deceased person make a declaration that if any one has any monetary demand against the deceased he may come forth with his claim so that it may be paid and discharged by heirs or they should remit/give up the loan in the name of Allah Almighty. Such an offer/declaration is made in the Janazah prayers of knowledgeable Muslims and people do make claims and receive satisfaction of their claim/debt or they give‑up their claim or loan in the name of Allah Almighty so that the deceased soul may rest in peace, but such a declaration is never seen to have been made in case of persons of wealthy class most probably for the reason that they make distinction between personal liability and liability of the venture of the company being separate legal entities though in most of such cases they have executed the documents guaranteeing personally return of the amount involved.
It is also pertinent to note that in our legal system the difficulties of the decree‑holders compound when the decree is sought to be executed. The obtaining of decree itself is not an easy task as all sorts of frivolous objections and delaying tactics are adopted/used for delaying completion of the trial. In addition to the delaying tactics adopted by the litigants the heavy work load of the Courts also contributes in delaying early and timely decision of causes. The number of cases daily fixed for hearing is so numerous that Presiding Officers cannot afford to give more than a few minutes to each case. The cases keep on lingering for years together due to all these factors.
The provisions of the Code of Civil Procedure are, therefore, to be viewed in the aforenoted perspective in addition to the legal question whether the power conferred by these provisions on a Court to grant additional amount over and above the amount decreed, though the said additional amount is called interest, falls within the definition of Riba.
It may be noted that the power conferred on the Court by law to grant additional sum is not premised on any act of the party to the transaction yet this grant of additional sum is without a counter‑value and is a payment receipt of which law permits over and above the principal amount. Thus, indirectly Riba al‑Nasiah has been allowed to be practised as it is Riba that is paid and received in a loan transaction and this is the Riba that has been prohibited by the Holy Qur'an. If the said provision is taken to be conferring a power on the Court to allow compensation to the lender/decree‑holder for the loss caused to him by not returning the amount of liability through vexatious pleas and dilatory tactics after the filing of the suit or even after passing of the decree then granting of such power to allow compensation cannot be objected to but the compensation at a fixed rate to be awarded in each and every case based on opportunity cost of money is not permissible as in each case such a power will have to be exercised in consideration of the circumstances prevailing in that particular case. The Legislature can also confer a power on the Court to impose penalty on a party who makes a default in meeting out his liability or who is found guilty of putting up vexatious pleas and adopting dilatory tactics with a view to cause delay in decision of the case and in discharging his liabilities and from, the amount of such penalty a smaller or bigger part depending upon the circumstances can be awarded as solatium to the party who is put to loss and inconvenience by such tactics. The amount of penalty can be received by the State and used for charitable purposes and in the projects of public interest including the projects intended to ameliorate economic conditions of the sections of the society possessing little or nothing i.e. needy people/peoples without means. The provisions of the Code of Civil Procedure, quoted above, are therefore, held to be repugnant to they Injunctions of Islam as laid down in the Holy Qur'an and Sunnah of the Holy Prophet (p.b.u.h.) for the reasons given above and these sections may, therefore, be suitably amended keeping in view the observations given above.
Following are the other provisions of the Code of Civil Procedure commented upon in the impugned judgment:‑‑‑
(i) Section 2(12);
(ii) Section 35(3);
(iii) Section 144(1);
(iv) Order XXI, Rule 11 (2)(g)
(v) Order XXI, Rule 38;
(vi) Order XXI. Rule 79(3);
(vii) Order XXI, Rule 80(3);
(viii) Order XXI, Rule 93;
(ix) Order XXXIV, Rule 2(1) (a)(i), (iii), (c) (i). and (ii):
(x) Order XXXIV, Rule 2(2);
(xi) Order XXXIV, Rule 4;
(xii) Order XXXIV, Rule 7(1)(a) (i)&(iii) and (c)(i)&(ii);
(xiii) Order XXXIV, Rule 7(2);
(xiv) Order XXXIV, Rule 11;
(xv) Order XXXIV, Rule 13(1);
(xvi) Order XXXVII, Rule 2;
(xvii) Order XXXIX, Rule 9;
The word "interest" wherever appearing in these provisions shall also be deleted and substituted appropriately.
Order XXXVII, Rule 2 (2) (a) and (b) are similar to the provisions of sections 79 and 80 of the Negotiable Instruments Act, 1881 and are subject to the same findings as recorded by us with regard to that Act. Both these provisions (i.e. sub‑rules (a) and (b) of Rule 2, Order XXXVII), of the Code are hereby declared repugnant to the Injunctions of Islam.
Rule 79 (3) of Order XXI of the Code provides that if, in pursuance of a decree of recovery, a debt receivable by the defendant is sold, the Court shall prohibit the original creditor of that debt from receiving the debt or any interest thereon, and the debtor from making payment thereof to any person except the purchaser.
Similarly, Rule 80(3) of the Order XXI of the Code contemplates the transfer of a negotiable instrument, required for the purpose of recovery, and provides as under:
"Until the transfer of such negotiable instrument or share, the Court may, by order, appoint some persons to receive any interest or dividend due thereupon and to sign a receipt for the same..."
Here again the appointed person has been allowed to receive interest. That is why the Federal Shariat Court has included it in the objectionable provisions.
The judgment of the Federal Shariat Court about these two provisions is upheld to the extent noted above.
VI. Cooperative Societies Act, 1925
Section 59(2)(e) of the Cooperative Societies Act, 1925 and Rule 14(1)(h), Rule 22 and Rule 41 alongwith Appendices I to IV have been discussed in paragraphs 312 to 321 of the impugned judgment and declared repugnant to Injunctions of Islam (PLD 1992 FSC 1). Section 71 (2), clause (ee) of the Cooperative Societies Act, 1925 as well as sub‑bye‑law (6) of Bye‑law (3) of the National Industrial Cooperative Finance Corporation Limited to the extent that such provide for "interest" have also been declared repugnant to the Injunctions of Islam vide PLD 1992 FSC 537 and PLD 1992 FSC 535 respectively.
The word "interest" appearing in these provisions has been ordered to be deleted on the ground that charging, levying and recovery of interest is not permissible under the Injunctions of Shariah. The impugned judgments of the Federal Shariat Court to that extent are upheld.
(VIII) The Insurance Act, 1938
The following provisions of the Insurance Act, 1938, were challenged before the Federal Shariat Court and the same to the extent that these provide for range of rate of interest, guarantee as to the interest amount, payment of interest on instalments and other conditions as to interest, were held to be repugnant to the Injunctions of Islam in paragraphs 322 to 324 of the impugned judgment:‑‑‑
S.3‑BB(1)(b).‑‑‑Prepare statement of yield indicating the range of rates of interest or yield on the investment of the insurers' funds.
Subsection (3) of section 27.‑‑‑In computing the assets required by the section to be kept invested by an insurer, a sum equal to the amount of his liabilities to persons who are not citizens of Pakistan m respect of life insurance policies issued in Pakistan in favour of such persons but expressed in a currency other than the Pakistan rupee may, if such sum is invested in securities of, and guaranteed as to principal and interest by, the Government of the country in whose currency such policies are expressed, be taken into account.
S.29(8)(b).‑‑‑ :he loan is of such amount that the instalment of capital and interest does not exceed one‑fourth of the basic salary of the employee or one‑fourth of the renewal commission or over?riding commission of an agent or an employer of agents, as the case may be, during a year;
(c) (iii) .‑‑‑the loan does not exceed such amount as may be prescribed and is subject to such conditions, including conditions as to interest and the time allowed for its payment, as may be prescribed.
S.47‑B.‑‑‑(1) Where payment on a policy issued by an insurer becomes due and the person entitled thereto has complied with all the requirements, including the filing of complete papers, for claiming the payment, the insurer shall, if he fails to make the payment within a period of ninety days from the date on which the payment becomes due or the claimant complies with the requirements, whichever is later, pay interest as specified in sub?section (2) on the amount so payable unless he proves that such failure was due to circumstances beyond his control.
(2) The interest under subsection (1) shall be payable for the period during which the failure continues and shall be calculated at monthly rests at the rate five per cent. higher than the prevailing bank rate.
S.81(2)(d).‑‑‑The report of the actuary shall contain an abstract in which shall be stated:‑‑‑
(d) the rate of interest assumed.
In the first provision the words "rates of interest" may be deleted in consonance with the objectives of prohibition of interest under Shariah. The word "interest" appearing in subsection (3) of section 27 need not be omitted as this pertains to securities of, and guarantees as to principal and interest, by the Government of the country in whose currency such policies are expressed. This as such pertains to the assured of foreign origin and securities of foreign Government. This amount, however, is to be taken notice in computing the investment required to be invested by an insurer. This aspect was not taken note of and merely as the word "interest" appeared, its deletion was directed. The word "interest" appearing in the other provisions may however, be deleted but it should be substituted with suitable amendments keeping in view the purposes and the policy of the law on the lines indicated in this judgment. The purpose should be to effectively implement the objectives of eliminating Riba from the economy of the society without hampering the economic activities and also ensuring at the same time the growth and progress of the economy together with fairness to meet the obligations and liabilities. However, the question whether Insurance business as in vogue is in accord with Injunctions of Islam is a different question, which is not under‑consideration in these appeals.
(IX) State Bank of Pakistan Act, 1956
Section 22(1) of the State Bank of Pakistan Act, 1956 has been scrutinized in paragraphs 325 to 328 of the impugned judgment and purchase of bills and other commercial instruments like Debentures, Bonds etc. on the basis of interest has been declared to be repugnant to the Injunctions of Islam by the Federal Shariat Court. This view is maintained and upheld. Obviously, the mode of transacting these financial products/instruments has to be changed to a mode compatible with the Islamic modes of finance. We would, therefore, leave it to the economists and bankers to adapt to the new situation keeping in view the Qur'anic prohibition of Riba:‑‑‑
(X) The West Pakistan Money‑Lenders' Ordinance, 1960
(XI) The West Pakistan Money‑Lenders' Rules, 1965.
(XII) The Punjab Money‑Lenders' Ordinance, 1960.
(XIII) The Sindh Money‑Lenders' Ordinance, 1960.
(XIV) The N.‑W.F.P. Money‑Lenders' Ordinance, 1960.
(XV)??? The Balochistan Money‑Lenders' Ordinance, 1960.
These laws pertaining to money‑lending and money‑lenders have been dealt with in paragraphs 329 to 331 of the impugned judgment. These laws, it was rightly observed, being alien to Islamic Injunctions and the concept of Islamic social justice, can have no place on the statute book of the land and these laws or the rules framed thereunder were rightly declared to be repugnant to the Injunctions of Islam.
(XVI) Agricultural Development Bank Rules, 1961
Paragraphs 332 to 336 of the impugned judgment deal with the vires of Rule 17 of the Agricultural Development Bank Rules, 1961 and the provisions of sub‑rules (1), (2) and (3) on the question of interest have been declared .to be repugnant to the Injunctions of Islam and have been directed to be deleted. Sub‑rules (1) (2) and 3 of Rule 17 read as? under:‑‑‑
"Rule 17. Interest, fees, commission_and incidentals. ‑‑‑(1) Loans shall be granted by the Bank at such rate or rates of interest as the Board may from time‑to‑time specify.
(2) In specifying the rate or rates of interest under sub‑rule (1), the Board may also specify a higher rate of interest which the Bank shall charge in the event of default of repayment of loan or any instalment thereof, not being a default due to any natural calamity.
(3) In addition to interest, the Bank may also charge such commission and incidental charges as the Board may from time to time specify."
Obviously the levy, charging and recovery of interest cannot be allowed to continue in view of the Shariah prohibition. These rules should, therefore, be suitably amended on lines indicated in this judgment.
(XVII) Banking Companies Ordinance, 1962
The learned Federal Shariat Court has declared section 25(2) of the Banking Companies Ordinance, 1962 (hereinafter referred to as 'Banking Ordinance') repugnant to the Injunctions of Islam to the extent of interest and mark‑up. The section empowers the State Bank of Pakistan to give certain directions to Banking Companies, including a direction about the rates of interest, charges or mark‑up to be applied on advances, or prohibiting the giving of loans to any borrower on the basis of interest.
So far as the provision of interest in this section is concerned, it is against the Injunctions of Islam in the light of the detailed discussion already undertaken about Riba. However, the learned Federal Shariat Court has also directed to delete the word "mark‑up" from this section, keeping in view the distorted method in which the concept is applied in the banks today. We have already held in the preceding paragraphs that the way 'mark‑up' is applied at present is nothing but Riba, hence prohibited. But at the same time we have held that the concept of a real sale, based on mark‑up, is not impermissible in its origin, subject to the conditions mentioned in judgments specially in paras. 191 and 219 of the judgment of Mr, Justice Muhammad Taqi Usmani. The major condition for the permissibility of a mark‑up transaction is that it should not be charged on lending or advancing money. It must be based on the genuine sale of a commodity with all its substantive consequences. But section 9 of the Banking Ordinance prohibits a bank from trading. It is provided in section 9 that:
"Except as authorized under section 7, no Banking Company shall directly or indirectly deal in the buying or selling or battering of goods or engage in any trade or buy, sell or barter goods for others, otherwise than in connection with bills of exchange received for collection or negotiation."
When the word 'mark‑up' used in section 25 is read in juxtaposition with section 9, it is certainly repugnant to the Injunctions of Islam, because a valid mark‑up transaction cannot be imagined without a genuine sale effected by the bank. Therefore, the provision of mark‑up and the provision of section 9 cannot stand together. Either of the two must be struck down.
We are conscious of the fact that the transaction of a sale of Murabaha based on mark‑up, even after fulfilling its necessary conditions is not an ideal mode for the extensive use of Islamic banks. Still, the banks will have to resort to this transaction in certain cases, especially in the initial phase of transformation. It is, therefore, more necessary to strike down section 9 as it stands at present, instead of striking down the transaction of `mark‑up' totally, because provisions of section 9 are an obstacle in the way of a true Islamic banking. These not only invalidate the transaction of Murabaha or Bai' Mu'ajjal according to Shariah, but also hamper the natural function of. leasing, hire‑purchase, Musharaka or Mudaraba transactions. Section 9 was, in fact designed in the context of interest‑based banking in which the banks deal in money and papers only, while a true Islamic financing is always backed by real assets, and this is the basic distinctive feature of Islamic banking which can rid the economy from many evils of the interest‑based banking already detailed before. The concept of Islamic banking cannot be translated into reality unless it is realized that the hanks are not meant only to deal in money and papers, but their financing is based on and firmly related with real business activities. The elimination of interest can neither be effective nor feasible without lifting the bar imposed on the banks by section 9 of the Banking Ordinance. We are of the firm view that the correct, just and practicable decision about the concept of mark‑up provided in section 25 is not possible unless the bar imposed by section 9 is relaxed.
Although the learned Federal Shariat Court has not touched upon section 9, yet the principle laid down by this Court in the case of Province of the Punjab v. Amin Jan Naeem and 4 others (PLD 1994 SC 141 at 156) is as follows:-
"We have held in a number of cases that where a proper and just settlement of the issues involved in a law under challenge is not possible without striking another provision of the same law, the Court has the jurisdiction to hit that provision also. Reference may be made to the case of Qazalbash Waqf v. The Land Commissioner, Punjab (PLD 1990 SC 99, para. 187, p. 280) where sections 60‑A of the Punjab Tenancy Act, 1887 has been struck down without an appeal from the public". (Para. 30)
In the light of the principle laid down in the above case, we are satisfied that a just decision about the `mark‑up' envisaged in section 25 of the Banking Ordinance is not possible without striking down section 9. It is therefore, held that the word 'mark‑up' in section 25 may be retained, however, section 9 of the same Ordinance is repugnant to the Injunctions of Islam in so far as it prohibits banks from purchase and sale of goods and other trading activities necessary for adopting the Islamic modes of financing like Bai' Mu'ajja1 and Murabaha based on mark‑tip, leasing, hire‑purchase and Musharaka in their true and genuine forms. Section 9 shall be substituted to accommodate all the Islamic modes of financing with their necessary requirements.
(XVIII) Banking Companies Rules, 1963
Relevant part of Rule 9 reads as under:‑--
"R.9.Intrest on deposits.----(1)
(2) Interest on foreign approved securities shall on realization be credited, if so desired by the Banking Company concerned, as soon as possible, to an account at the place where the office of the National Bank of Pakistan holding the securities under sub‑rule (1) of rule 5 is located, subject to the usual charges; and, in other cases, such interest shall be remitted by the office of the National Bank of Pakistan to the principal office of the State Bank at the prevailing rate of exchange after deducting the usual charges:
(3) The principal office of the State Bank shall credit, as soon as possible, the current account of the company maintained with it with the interest realized on rupee securities, subject to the usual charges, and with the amounts, if any, remitted from abroad by the office of the National Bank of Pakistan under sub‑rule (2)."
Sub‑rule (2) provides for crediting of interest on foreign approved securities on realization while sub‑rule (3) relates to crediting of interest realized on rupee securities. In paragraph 342 of the impugned judgment it is stated that in the face of the detailed discussion held, sub‑rules (2) and (3) of rule 9 in‑ so far as they pertain to interest are held to be repugnant to the Injunctions of Islam as laid down in the Holy Qur'an and Sunnah of the Holy Prophet (p.b.u.h.). The retention of interest on foreign approved securities already realized need not be refused. The amount so received is to be credited to Baitul Mal and can be used for discharging the foreign debt and meeting out the other liabilities. Such a transitory and provisional course of action is allowed by Shariah. Same way, the interest received on Rupee securities already issued and held can be similarly dealt with. However, in future such transactions which involve interest shall not be permitted.
(XIX) The Banks (Nationalization) Payment of Compensation Rules, 1974
Rule 9 which provides for reckoning of interest froth the date of acquisition of the shares and' its annual payment and the procedure of payment of interest have been dealt with in paragraph 343 to paragraph 350 and these provisions referring to interest have been held to be repugnant to the Injunctions of Islam. We are of the view that instead of merely deleting the word "interest" from the various clauses of Rule 9, a new rule should be framed on the lines indicated to this judgment ensuring effective enforcement of prohibition of interest in future. However, the return or the profit relatable to the shares shall be managed through Shariah Compliant modes.
(XX)??? The Banking Companies (Recovery of Loans) Ordinance, 1979
Section 8 of the Ordinance had come under scrutiny in paragraphs 351 to 354 of the impugned judgment and whole of section 8(2)(a) relating to interest and section 8(2)(b) relating to mark‑up have been held repugnant to the Shariah injunctions. These provisions should be dealt with on the lines indicated in this judgment while discussing the relevant provisions of Code of Civil Procedure.
We have held in paras. above that the framing of the laws and economic and monetary policies is the function of concerned organs and institutions of the State and not of this Court but as the Government has insisted in its application that guidelines be provided in respect of the issues raised and as the economists, religious scholars etc. have expressed their opinion with respect to these issues and with 'respect to the infrastructure needed to successfully practice Islamic economic system, we hereby proceed to record guidelines for the consideration of the concerned quarters.
The scholars, economists, and auditors to name a. few of them Dr. Muhammad Umer Chhapra, Dr. Shahid Husan Siddiqui, Mr. Ibrahim Sidat, Syed Muhammad Hussain, Mr.Iqbal Khan and Mr.Faheem Ahmad of Vital Information Services (Pvt.) Limited, were unanimous in the submission that elimination of Gharar, deceit and fraud is necessary by providing effective and necessary legal framework in order to ensure success of any economic system. It was added that the small investors who invested either in the stock markets or in bank deposits have been losers for the reasons that their savings have been eroded partially or fully because of presence of Gharar and speculative characteristics of our stock markets. A reduction of nearly Rs. 300 billion in the market capitalization has gone unheeded. Similarly, defaults on bank loans amounting to approximately Rs.300 billion restricted these institutions to offer a reasonable return on deposits of small investors. It was added that loopholes in the economic system allow defaulters to get away without any resistance and as such stringent measures/regulations are required to check speculative activities in the stock markets as also by formulating and administering monetary policy by an independent body which is competent and powerful enough to seek compliance of the monetary policy including borrowing activity prescribed under the laws/regulations to be framed and enacted in terms of the Constitutional mandate of Article 79 of the Constitution. Dr. Muhammad Umar Chhapra, a renowned Muslim economist, laid stress on the recovery of the defaulted loans within a reasonable time, which according to him, should not be more than one month, by enacting proper laws and creating adjudicatory process, efficient and competent to secure recovery from the defaulters within the prescribed time frame, if the success of the Islamic economic system is to be ensured. He was of the view that if the cases of default of the financial institutions are allowed to linger on for months and years, the availability of funds for the economic activity cannot be ensured and the whole system would collapse. He, therefore, suggested that measures will have to be adopted to ensure elimination of deceit so as to meet the moral hazards likely to arise in the actual working of the Islamic banking system as well as to ensure transparency and regulation of the economic system on sound and practicable norms. Mr. Faheem Ahmad particularly referred to the laws, prudent regulations and other measures being adopted by the United States for the purposes of elimination of Gharar, deceit and fraud. It was pointed out that the monetary policy is administered in America by the Federal Reserve (FED of the USA similar to the central bank of a country which is an autonomous body outside the influence of President, Congress and Courts in USA, to regulate supply of money and credit in the economy. The Freedom of Information Act, 1966 (FOIA ‑ 1966) enjoins all US Government Agencies to disclose records upon request. The right so conferred has also been made enforceable through Court. All agencies of the Government are required to disclose their records upon receiving written request for the same except for such records as are protected from disclosure by the nine exemptions and three exclusions provided for in the Act itself. The Privacy Act of 1974 prescribes safeguards for the protection of records the Government collects and maintains on United States citizens and lawfully admitted permanent residents.' Security Exchange Commission of the United States maintains public and non‑public records such as registration statements and reports filed by regulated companies and individuals. The laws provide for regulating trading and commerce to eliminate fraud, manipulation and dissemination of false information to ensure just and equitable trading. It is also provided that short sales must be made on an 'uptick' to regulate the use of credit for trading, including insider trading. The beneficial owners of 10 per cent. or more are considered `insiders' and to prevent unfair use of information by insiders, profits realized from security transactions within a period of 6 months are forfeited to the corporation.
In United States even for members of bureaucracy i.e. employees of the Executive Branch, standards of ethical conduct have been provided by the Ethics in Government Act, 1978 and the Regulations issued by the U.S. Office of Government Ethics. These Regulations provide that Public?--Service is public trust, requiring employees to place loyalty to the Constitution, the laws and ethical principles above personal gain; and that employees shall not hold financial interests that conflict with conscientious performance of duty; employees shall not knowingly make unauthorised commitments or promises of any kind purporting to bind the Government and shall not use public office for private gain; they shall not engage in outside employment or activities that conflict with official duties and responsibilities. A gift even of the value of 20 Dollars in a given situation is not to be accepted. The senior employees after leaving service are prohibited for a period of one year in certain situations, even if they were not paid for their work from contacting their former department or Agency to seek official action on any matter or assisting a foreign Government or foreign political party. In this manner for a period of one year after leaving Government job, employment with the foreign or local employer is sought to be prohibited. The ethical standards, thus, are designed to protect national interests and to ensure transparency and fair dealing. Such‑like prudential measures of good governance, fair dealings and transparency arc conspicuously absent in our laws as in our land, senior employees exchange places frequently i.e. from the employment of Federal Government to foreign Agencies e.g. World Bank and International Monetary Fund and vice versa and the people keep on watching the change of places silently but ask questions to themselves as to whom these experts are supposed to serve, Pakistan or foreign Agencies.
The laws in Pakistan on these subjects do exist but these need to be made comprehensive and also to be implemented in true spirit. It may further be pointed out that effort to eliminate only Riba. in isolation from Banking system would be more harmful than helpful due to intricate inter dependence of different vital economic sectors, and that the efficient course will be to first identify and strengthen the existing critical economic sectors falling under Shariah, thus, isolating Riba based system for its proper treatment. It was argued that the economy in this way will be strengthened and a strong foundation will be laid to promote Riba‑free economy. An important fall out of this approach will cause the major savings of citizens to be channeled into Shariah Compliant sectors. This situation, it was emphasized, will automatically put pressure on our Riba‑based Banking system to innovate itself into Islamic system to attract depositors investing in parallel Shariah‑based sectors. It was explained that the reason for the under‑development of Shariah‑based instruments in our Banking system is due to inefficient and unregulated parallel major Shariah compliant (stock markets) economic sectors in existence.
Four major engines of economy identified by the economists which fueled the West's economic growth are following:‑‑‑
(i) Banking/Financial Sector;
(ii) Share market;
(iii) Debt/Bond Market; and, (iv) Government Borrowing/Lending.
The following statistics were cited to illustrate the most important sectors among the abovementioned areas:‑‑‑
"USA?????????????? Malaysia?????????????????????? Pakistan
GDP??????????????????????????????????????????????????? 8 trI????????????????? 72 bn ????????????????????????? 60 bn
Share Market?????????????????????????????????????? 10 trl??????????????? 100 bn ??????????????????????? 6 bn
Debt Market??????????????????????????? ??????????? 10 trl??????????????? 22 bn ????????????????????????? 40 m
All figures are approx. and in US$; Debt Market figures are for corporate borrowings only. "
The above figures demonstrate the importance of regulated public participation in most important sectors which have given a solid foundation to these economies and created better distribution of wealth among the masses. It is to be noted that creation of large middle class is also a touchstone of Islamic Financial model to fight concentration of wealth in few hands.
The other pertinent thing to be noted is that the total value of capital market is much bigger than the GDP. So, even if we, in Pakistan, are successful in creating an Islamic‑based judicious regulations, at least for Capital Markets, we can hope for a quick change for the better as these reforms would be effective to check corruption in all the sectors. The disinter mediation will also trigger competition within our banking sector towards promoting Islamic products. The regulatory framework to control unlawful conduct including Gharar is designed to maximize Justice and fair?play at all levels of investors' interaction. The regulatory agencies eliminated Gharar by bringing as much transparency/fairplay as possible in all public dealings. The disclosure requirements are so elaborate that speculative activities are minimized. This is achieved, inter alia, through the following measures:‑‑‑
(1) Individual's Credit History
No individual is allowed to get utilities connections, open any bank account, or obtain a loan unless his credit report received from a credit bureau is clean. These bureaus are non‑government entities and by paying a nominal fee any organization can access the databases for requisite information.
(2) Industries' Rating
Four rating agencies namely, (i) Standard and Poor's (ii) Moody's (iii) DCR, and (iv) Fitch‑IBCA are referred to by the Financial Institutions and Lending Institutions for reporting about credit ratings of the borrowers before extending loans, whether the borrower is a corporate body or other institution. The Security Exchange Commission, USA grants them licence and monitors their quality of work. In Pakistan to regulate the business of credit rating companies, the Credit Rating Companies Rules, 1995 were framed by the Federal Government under section 33 of the Securities and Exchange Ordinance, 1969, but these rules have not been usefully applied whereas in USA individuals, Corporations, Banks and Financial Institutions and even the municipalities are all rated by the Credit Companies and their credit rating is relied upon by the investors before investing into the bonds or other instruments floated or offered for investment to the public. These ratings are instituted on the philosophy of right to know.
Even in England various statutes provide for prudential regulations and disclosure of necessary information. The Financial Services Act, 1986 and the regulations framed thereunder provide protection for the investors with the "securitisation" of the investment industry in order to provide a system intended to make effective and to enhance London's position as a financial centre. The Serious Fraud Office (S.F.O.) was established as an integral part of the criminal justice system. The S.F.O. is responsible for investigation and prosecution of some of the biggest cases of fraud in British history. The S.F.O. is an independent Government Agency headed by a Z Director who exercises his powers under the superintendence of the Attorney‑General, maintains liaison with Government departments and regulatory bodies such as the Department of Trade and Industries, Bank of England, International Stock Exchange, Securities and Investment Board, etc. These and other organizations report to the S.F.O. allegations of serious and complex abuse and misuse of powers and white‑collar crimes.
The distinctive feature of the S.F.O.'s approach to investigations is the use of multidisciplinary teams; a team of Lawyers, Accountants, Police Officers, etc. appointed in each case, headed by a lawyer, who acts as a case controller being responsible for ensuring expeditious investigation and effective prosecution. It is through such measures that the West has effectively adopted Islamic teachings of justice, fair‑play and proper disclosure to minimize Gharar. These measures are to be adopted by providing proper legal framework so as to bring about fundamental changes in the fabric of our society as transparency will put the economy on the right track quickly. It is due to absence of this regulatory legal framework and transparency and prudential measures, that the investors in Pakistan were deprived of billions in the shape of Taj Company and Cooperatives Scams. There has been a quick growth of companies at Stock Exchange as the corporate managers are least bothered to take investors into confidence by sharing company information and do not feel any moral obligation to share profits with investors. All this is due to absence of strict regulations, third party ratings and risk assessment. A comparison between the 'size of the economy, and number of listed companies can be a guide to the loose regulatory framework that encourages rogues to fleece investors and creditors in the disguise of "Limited Liability" Laws. The number of companies at Karachi Stock Exchange Market are 750 while the number of listed companies at New York Stock Exchange is five times larger whereas .economy of USA is more than 100 times bigger than Pakistan's economy. Unlike western countries there are no laws in Pakistan against insider, trading (trading in shares by owners) by major shareholders, which is conflict of interest, a crime in West.
The market indexes in the West like DOW JONES (USA), FTSE (UK), and Nikkei (Japan) were developed by third parties. In Pakistan the KSE (Karachi Stock Exchange) 100 index is maintained by the stock market itself and has come under adverse comment from Minister of Finance due to its speculative characteristics. It is said that this index serves the purpose of few players in the market by luring innocent investors into investment, thus, cyclically depriving them of their hard‑earned money, This also requires transmission by introducing independent transparency.
(3) Debt markets in Pakistan
We' have an inactive debt market and its savings have been repeatedly wiped out as unlike western markets during melting down of stocks, debt markets are not in a position to provide the necessary "hedge" to the investors. The result of this under‑developed debt market is the promotion of Riba through savings being channeled into Banking system as industries want long‑term finance, they have to resort to the Banking system which in turn results in promoting Riba transactions. If the concept of Islamic debt through Musharakah certificates is adopted on urgent basis lot of equity/funds can be made available through developed debt markets and in that way‑ reliance on banks can be reduced. Infrastructure can be provided by advising provinces/municipalities/corporate bodies to connote Qirad certificates/diminishing Musharakah certificates, thus, reducing reliance on foreign exchange borrowings and this is how local funds can be generated.
(4)? Establishment of data collection firms
The financial institutions should encourage, experts, lawyers and others to establish firms for keeping track of the clients, individuals, corporations who commit default so that they could be brought before the competent Courts by facilitating service of the process of the Courts on them and also trace their properties and assets whether standing in their names or benami to facilitate recovery through execution of decrees."
(5) Recovery system
The laws pertaining to recovery of the defaulted loans are to be streamlined alongwith establishment of requisite number of Courts presided over by competent Judges of unquestioned integrity. These Judges should not be over burdened and only such number of cases should be assigned to them which can be disposed of within a period of three months. The tendency to institute recovery proceedings only when the borrowing company or the individual have almost squandered away their assets requires to be curbed and defaulters must be brought to book by instituting proper proceedings within reasonable time of default when the borrower as well as his assets are still traceable and realizable.
(6) Training of Officers and Staff
The education of the officers and staff of the financial institutions so its to make them aware of the rudimentary or essential principles of Islamic economy is imperative. They should have necessary knowledge of the modes and the products to be used by them. These training institutions should include courses in accounting and audit procedures suited and conforming to the principles of Shariah. Such an education will be objective oriented and should inculcate commitment with the objectives of Shariah.
(7) Audit and Accounts
The development of audit and accounts system and procedures conforming to the principles of Injunctions of Islam and capable of achieving objectives of Shariah is also essential. Such standards and procedures have been laid down in detail in the book titled "Accounting and Auditing Standards for Islamic Financial Institutions" published by Accounting and Auditing Organization for Islamic Financial Institutions P.O.Box 1176, Manama, Bahrain. Institute of Chartered Accountants and Auditors with the assistance of the representatives of the State Bank of Pakistan and Finance Division should study these standards, procedures for introducing any modification, changes, alterations if any required to suit the requirements and the needs of Financial Institutions and Banks in Pakistan.
In a nutshell measures needed to be taken, the infrastructure and legal framework to be provided may be summarized as under:‑‑‑
(1) Strict austerity measures to drastically curtail the Government expenditure should be adopted and implemented and deficit financing should be controlled as therein lies the solution to economic revival.
(2) An Act to regulate the Federal Consolidated Fund and Public Account, Provincial Consolidated Fund and Public Account requires to be enacted by the Parliament and the Provincial Assemblies respectively. This law will have to take care of borrowing powers, purpose and the scope of borrowing, its utilization, regulation and monitoring process including all ancillary matters.
(3) Law providing for necessary prudential measures ensuring transparency be enacted. These laws may include laws like Freedom of Information Act, the Privacy Act and Ethics Regulations of United States, Financial Services Act of Britain.
(4) Establishment of Institution like Serious Fraud Office to control white collar and economic crimes.
(5) Establishment of credit rating agencies in the public sector.
(6) Establishment of evaluators for scrutiny of feasibility reports.
(7) Establishment of special departments within the State Bank ‑
(a) Shariah Board for scrutiny and evaluation of Board's procedures and products and for providing guidance for successfully managing; the Islamic economics.?????????
(b) A Board for arranging exchange of information, financial institutions about feasibility of projects, evaluation thereof and credit rating of institutions, corporations and other entities.
(c) A board for providing , technical assistance to the financial institutions/banks with regard to the anomalies emerging in the? practical operation of the financial institutions or difficulties arising? during operation of financial products, transactions or arrangement between the financial institutions and the consumers/clients. This may also take the shape of Islamic Financial Service Institution. Such Institutions will also work in the field of shares and investment certificates underwriting promotion and market making to help in activation of primary and secondary markets 'the rise of such institutions, whose functions include the promotion of financial instruments and to work as their catalysts in the financial market, would be of great help and support to Islamic Banking. Among the factors which would help the creation and spreading of such institutions is the extension of tax incentives to their operation as well as to Islamic banks to benefit from their services.
The establishment of aforenoted Infrastructure is considered necessary by the economists for operation of the Islamic Banking system with success.
Keeping all these aspects in view, we have decided to appoint different dates for different phases of the transformation. We; therefore, direct that:‑‑‑ ??????????
(1) The Federal Government shall, within one month from the announcement of this judgment; constitute in the State Bank of B Pakistan a high‑level Commission fully empowered to carry out, control and supervise the process of transformation of the existing financial system to the one conforming to Shariah. It shall comprise Shariah scholars, committed economists, bankers and chartered accountants.
(2) Within two months from the date of its constitution, the Commission shall chalk out the strategy to evaluate, scrutinize and implement the reports of the Commission for Islamization of the Economy as well as the report of Raja Zafarul Haq Commission after circulating it among the leading banks, religious scholars, economists and the State Bank and Finance Division, inviting their comments and further suggestions. The strategic plan so finalized shall be sent to the Ministries of Law, Finance and Commerce, all the banks and financial institutions to take steps to implement it.
(3) Within one month from the announcement of this judgment, the Ministry of Law and Parliamentary Affairs shall form a task‑force, comprising its officials and two Shariah scholars from the Council of Islamic Ideology or from the Commission of the Islamization of Economy, to:
(a) Draft a new law for the prohibition of Riba and other laws as proposed in the guidelines above.
(b) To review the existing financial and other laws to bring them into conformity with the requirements of the new financial system.
(c) To draft new laws to give legal cover to the new financial instruments.
The recommendations of the task force shall be vetted and finalized by the "Commission for Transformation" proposed to be set up in the SBP, after which the Federal Government shall, promulgate the recommended laws.
(4) Within six months from the announcement of this judgment, all the banks and financial institutions shall prepare their model agreements and documents for all their major operations and shall present them to the Commission for transformation in the SBP for its approval‑after examining them.
(5) All the joint stock companies, mutual funds and the firms asking in aggregate finance above Rs.5 million a year shall be required by law to subject themselves to independent rating by neutral rating agencies.
(6) All the Banks and financial Institutions shall, thereafter, arrange for training programmes and seminars to educate the staff and the clients about the new arrangements of financing, their necessary requirements and their effects.
(7) The Ministry of Finance shall, within one month from the announcement of this judgment, form a task force of its experts to find out means to convert the domestic borrowings into project-?related financing and to establish a mutual fund that may finance the Government on that basis. The units of the mutual fund may be purchased by the public and they will be tradable in the secondary market on the basis of net asset value. The certificates of the existing bonds of the existing Government savings schemes based on interest shall be converted into the units of the proposed mutual fund.
(8) The domestic inter‑Government borrowings as well as the borrowings of the Federal Government from State Bank of Pakistan shall be designed on interest‑free basis.
(9) Serious efforts shall be started by the Federal Government to relieve the nation from the burden of foreign debts as soon as possible, and to renegotiate the existing loans. Serious efforts shall also be made to structure the future borrowings, if necessary, on? the basis of Islamic modes of financing.??
(10) The following laws being repugnant to the Injunctions of Islam shall cease to have effect from 31st March, 2000:‑‑‑ .
1.The Interest Act, 1839;
The West Pakistan Money‑Lenders' Ordinance, 1960;
The West Pakistan Money‑Lenders' Rules, 1965;
The Punjab Money‑Lenders' Ordinance, 1960;
The Sindh Money‑Lenders' Ordinance, 1960;
The N.W.F.P. Money‑Lenders' Ordinance, 1960;
The Balochistan Money‑Lenders' Ordinance, 1960;
Section 9 of Banking Companies Ordinance, 1962;
(11) The other laws or the provisions of the laws to the extent that those have been declared to be repugnant to the Injunctions of Islam shall cease to have effect from 30th June, 2001.
The appeals stand disposed of accordingly.
(Sd.)
Justice Khalil‑ur‑Rehman Khan, Chairman.
(Sd.)
Justice Munir A. Sheikh, Member.
Agreeing with the bulk of the above findings and conclusions, I have, respectfully, subscribed a note of my own, where, explicitly or implicitly, my reservations, as to some of the findings and conclusions of the majority, stand incorporated.
(Sd.)
Justice Wajihuddin Ahmed, Member.
(Sd.)
Justice Maulana Taqi Usmani, Member.
JUDGMENT
JUSTICE KHALIL‑UR‑REHMAN KHAN (CHAIRMAN). ‑‑‑This .Judgment will dispose of 55 appeals filed as of right under Article 203‑F of the Constitution of the Islamic Republic 6f Pakistan, 1973 against a number of judgments of the Federal Shariat Court, detail of which is given in the title of this judgment, whereby certain provisions relating to "interest" as contained in various laws, have been declared to be repugnant to the Injunctions of Islam as contained in the Holy Qur'an and Sunnah of the Holy Prophet (peace be upon him), with direction to delete the said provisions by amending the said laws. The first of these judgments rendered on 14‑11‑1991, reported as PLD 1992 FSC is has been assailed in Shariat Appeals Nos. l/92 to 231.92, 36/92 to 58/92 and 91/92 whereby findings with regard to some of the impugned Acts/Rules have been particularly challenged while in Shariat Appeal No.73/92, the appeal filed by Federation of Pakistan, all the findings on all the laws recorded by the learned Judges of the Federal Shariat Court have been brought under challenge. The laws containing provisions as to "interest", "return" or "mark‑up" subject‑matter of the impugned judgment are as under:
(1) The Interest Act, 1839.
(2) The Government Savings Banks Act, 1873.
(3) The Negotiable Instruments Act, 1881.
(4) The Land Acquisition Act, 1894.
(5) The Code of Civil Procedure, 1908.
(6) The Cooperative Societies Act, 1925.
(7) The Cooperative Societies Rules, 1927.
(8) The Insurance Act, 1938.
(9) The State Bank of Pakistan Act, 1956.
(10) The West Pakistan Money‑Lenders' Ordinance, 1960.
(11) The West Pakistan Money‑Lenders' Rules, 1965.
(12) The Punjab Money‑Lenders' Ordinance, 1960.
(1:3) The Sindh Money‑Lenders' Ordinance, 1960.
(14) The N.‑W.F.P. .Money‑Lenders' Ordinance, 1960.
(15) The Balochistan Money‑Lenders' Ordinance, 1960.
(16) The Agricultural Development Bank of Pakistan Rules, 1961.
(17) The Banking Companies Ordinance, 1962.
(18) The Banking Companies Rules, 1963.
(19) The Banks (Nationalization) (Payment of Compensation) Rules, 1974.
(20) The Banking Companies (Recovery of Loans) Ordinance, 1979.
Shariat Appeals Nos.96/92 and 100/92
In these Shariat Appeals, judgments dated 22‑6‑1992 of the Federal Shariat Court (PLD 1992 FSC 538), whereby two circulars bearing Nos.603‑22‑RCS dated 31‑2‑1969 and RCS/B&C/4869‑5018 dated 5‑12‑1979 issued by the Registrar, Cooperative Societies, Punjab, Lahore, to the extent they provide for charging interest have been declared repugnant to the Injunctions of Islam, have been challenged.
Shariat Anneals Nos. 99/92 and 101/92
In these Shariat Appeals judgments dated 22‑6‑1992 of the Federal Shariat Court (PLD 1992 FSC 537), whereby clause (ee) of subsection (2) of section 71 of the Cooperative Societies Act, 1925 in so far as it relates to the provision of "interest" was declared repugnant to the Injunctions of Islam, has been challenged.
Shariat? Appeals Nos.97/92, 98/92 and 102/92
In these Shariat Appeals judgment of Federal Shariat Court dated 30‑6‑1992 (PLD 1992 FSC 535), whereby? sub‑bye‑law (6) of Bye‑Law 3 of the National Industrial Cooperative Finance Corporation Limited, to the extent that it provides for? "interest" was declared repugnant to the Injunctions of Islam, has been challenged.
It is pertinent to note that the Federal Shariat Court with a view to elicit views/opinions of the distinguished Ulema, Scholars and Economists issued a Questionnaire relating to the impugned fiscal laws and the issues arising for consideration. The Questionnaire reads as under:‑‑
"(1) What is the definition of Riba according to the Holy Qur'an and Sunnah of the Holy Prophet (p.b.u.h.)? Does it cover the simple and compound interest existing in the present day financial transactions?
(2) If banking is based on interest‑free transactions, what would be its basic practical shape in conformity with the Injunctions of Islam?
(3) (i) Does the interest on loans floated by the Government to meet national requirements come under Riba?
(ii) What alternatives can be suggested for the banks in case they grant loans without interest for various requirements"
(4) Can, in the light of the In junctions of Islam, any differentiation be made between private and public banking in respect‑ of charging of interest on banking facilities or services rendered"
(5) (i) Can the capital, according to the Injunctions of Islam, be regarded as an agent of production thus requiring remuneration for its use?
(ii) Does devaluation of the currency affect the payment of loans taken before such devaluation?
(iii) Can inflation causing rise in the cost/value of gold and consumer goods in terms of currency have any effect on the sum borrowed?
(6) What would be the alternatives in the context of present day economic conditions to carry on domestic and foreign trade efficiently without availing of banking facilities based on interest?
(7) Is interest permissible or otherwise on the transactions between two Muslim States or a Muslim and non‑Muslim State?
(8) Is it possible to carry on insurance business otherwise that on the basis of interest?
(9) Does interest accruing on Provident Fund come under Riba ?
(10) Can the payment of prize money on Prize Bond or Saving Bank Account or other similar Schemes be regarded as Riba?
(11) Would it be lawful under Islamic Law to differentiate between business loans on which interest may be charged and consumption loans which should be free of interest?
(12) If interest is fully abolished, what would be the inducements in an Islamic Economic System to provide incentives for saving and for economising the use of capital?
(13) Can an Islamic State impose any tax on its subjects other than Zakat and Ushr?"
A consolidated statement of the question‑wise opinion prepared and compiled by Research Section of the Federal Shariat Court has been appended as Appendix `A' to the main impugned judgment delivered by the Federal Shariat Court. The Scholars, Ulema, Economists and Bankers, who had submitted replies to the Questionnaire have been listed in paragraph 19 of the impugned judgment.
This Court also prepared a Questionnaire highlighting the issues requiring determination and sent it to distinguished Ulema, Scholars, Bankers, and Economists of the country and abroad for their opinions. The Questionnaire reads as under:‑‑
"Q.1. The Holy Qur'an has prohibited `Riba'. What is meant by this term? What is its true definition and connotation in the light of the Holy Qur'an and Sunnah of the Holy Prophet (p.b.u.h.)?
Q.2. What is the true scope of the transactions to which the bar of Riba is applicable? Can the term Riba be also applied to the commercial or productive loans advanced by the banking and financial institutions and to the interest charged thereon"?
Q.3. The Pakistani banks and some financial institutions finance their clients on the basis of buy back on mark‑up agreements According to this method the client of the Bank purports to sell a particular commodity to the bank, and simultaneously buys it back on a high price on deferred payment basis. A certain rate of mark‑up (per cent. per annum) is applied to the second sale. Does this arrangement fall within the ambit of Riba?
Q.4. Is there any difference between a M_ uslim and a non‑Muslim in the matter of prohibition of Riba? Can the prohibition of Riba be extended to the loans obtained from non‑Muslim, or for that matter, from Muslim foreign countries whose laws and national policies, together with international monetary laws and policies, are not within the control of the State of Pakistan?
Q.5. The Government of Pakistan and some institutions under its control acquire loans by issuing bonds and certificates etc. and pay a fixed period‑wise `profit' to the holders of such securities. Does this profit fall within the definition of Riba?
Q.6. It is evident that the value of the paper currency has a trend of decrease in the inflationary situation. If a debtor who has borrowed a particular amount of paper currency repays the same amount to his creditor after a substantial time, the creditor can suffer the effects of inflation. If he demands his debtor to pay more in order to compensate him for loss of value he has suffered, can this demand be treated as a demand of Riba?
Q.7. If all the forms of interest or mark‑up are held to be repugnant to the Islamic Injunctions, what modes of financing do you suggest for: (a) financing trade and industry; (b) financing the budget deficit; (c) acquiring the foreign loans; and (d) similar other needs and purposes?
Q.8. If you are of the view that all the forms of interest are prohibited by Shariah, then what procedure will you suggest for eliminating it from the economy? If you prefer a gradual process, what strategy do you suggest for the purpose which may fulfil the requirements of the Holy Qur'an and Sunnah?
Q.9. If all the transactions based on interest are held to be violative of the Islamic Injunctions, what will be the treatment of the past transactions and agreements? Especially what procedure should the Government adopt with regard to the previous foreign loans?
Q.10.?? Whether a creditor can fix time and rate of profit while the debtor saying Insha Allah, he will be liable to earn and pay the same in time; failing which the guarantor may give profit asked? for plus also a bonus or compensation for delayed payment, if any, also according to other arrangements regarding the loan What will be the position if the system of insurance for the said profit is introduced??
Following Ulema, Scholars and Economists, amongst others, submitted written answers to the Questionnaire issued by this Court:‑‑
(1) Mr.Sartaj Aziz, the then (at the time of submission of replies) Minister for Finance and Economic Affairs, Government of Pakistan, answering the Questionnaire in his capacity as an expert and not in his official capacity as Finance Minister, as it was stated that the response of the Government of Pakistan on the Questionnaire involved is to be submitted to the Court by the Attorney General.
(2) Islamic Development Bank, Jeddah.
(3) Prof. Khurshid Ahmad, Institute of Policy Studies.
(4) Dr.Ziauddin Ahmed, Karachi.
(5) Mr.Zafar Ishaque Ansari, Director‑General, Islamic Research Institute; International Islamic University, Islamabad.
(6) Dr.Nawazish Ali Zaidi, Rawalpindi.
(7) Dr.Arshad Zaman, Karachi. .
(8) Mr.Abdur Rauf Sheikh, Lahore.
(9) Prof. Dr. Muhammad Najatullah Siddiqui, International Islamic Economics Centre, Malik Abdul Aziz University, Jeddah.
(10) Mr. Alsiddique Muhammad al‑Amin, Teacher, Al‑Shariah Al? Islamia Law Department, Khartoom University, Sudan.
(11) Report containing answers prepared under supervision of Prof. Dr. Jamila Shaukat, Dean, Faculty of Islamic and Oriental Learning, University of the Punjab, Lahore.
In addition to the above answers/opinions, different individuals and organizations addressed letters and sent material containing their views on the question of Riba' which shows keen interest of the people in the matter. It is neither possible nor appropriate to mention the views so expressed by everyone of them. However, material sent and the views expressed by the prominent scholars and writers have been thoroughly examined. They have, in the material sent by them, dealt with the issues relevant to the question of elimination ofRiba'. The following scholars have sent the material, books or copies of their published articles:‑‑
(1) Syed Maroof Shah Shirazi, Shariah Academy, International Islamic University, Islamabad.
(2) Mr.Anwar Ahmad Minai, Karachi.
(3) Syed Naseeb Ali Shah, Nazim Majlis‑e‑Fiqhi, Jamiat Ulami Pakistan.
(4) Mr.G.M. Saleem, Advocate, Karachi.
(5) Mr. Mehmood Ashraf, Chartered Management Accountant, Karachi.
(6) Mr.Abdul Moin Ansari, Latifabad, Hyderabad.
(7) Prof. Dr. Muhammad Tahir ul Qadri, Lahore.
(8) Dr. Attaullah Khan Niazi, Economic Expert.
(9) Mr.Abdul Hafeez Khokhar, Advocate.
(10) Mr. Aqdas Ali Kazmi, Chief/Director Tax Policy, Central Board of Revenue.
(11) Mr.Aurangzeb Haque.
(12) Prof. Ziauddin Ahmad.
Besides learned counsel for the parties, the following Scholars. Economists and Bankers appeared and made their submissions:‑‑
(1)? Dr. Syed Muhammad Tahir, International Islamic University;
(2) Dr.Waqar Masood Khan, Director‑General, (Planning), International Islamic University, Islamabad;
(3) Mr.Abdul Jabbar Khan, former President, National Bank of Pakistan;
(4) Dr.Umar Chapra;
(5) Mr.Ibrahim Sidat;
(6) Dr.S. Muhammad Hussain;
(7) Dr.Irshad Zaman, Chartered Accountants/Economists;
(8) Mr. Maqbool Soomroo;
(9) Dr.Shahid Hasan Siddiqui, Eeconomist;
(10) Mr.Abdul Wadood Khan;
(11) Hafiz Abdul Rehman Madni, Chairman, Islamic Research Council, Lahore;
(12) Dr.Aslam Khaki, Advocate, Islamabad;
(13) Prof. Khurshid Ahmad;
(14) Mr.H.U.Beg (Retired Finance Secretary, Government of Pakistan);
(15) Prof. Syed Nawaz Haider Naqvi;
(16) Mr. Muhammad Yahya (Deputy Secretary‑General, Mutahida Ulema Council of Pakistan);
(17) Maulana Gauhar Rehman;
(18) Mr. Iqbal Khan (Foreign Expert--Managing Director, Global Islamic Finance; HSBC Investment Bank Plc, United Kingdom);
(19) Dr. Ahmad Muhammad Ali (President, Islamic Development Bank,? Jeddah) alongwith his delegation namely, Mr.Muad Ali Umar (Vice‑President, I.D.B.) Dr.M.Alfatah (Legal Adviser I.D.B.) Mr.D.M.Qureshi (Adviser Treasury, I.D.B.) Mr.Muhaad Al‑ Jehri (Director, I.D.B.), Dr.Hussain Hassan (Head of Shariah Board, Dubai Islamic Bank) and Mr.Adnan A1 Bahr, Managing Director and Chairman, International Investment Company, Kawet);
(20) Mr.Ismail Qureshi, ASC;
(21) Mr. Faheem Ahmad (Marketing Coordinator, Financial Research and Analysis Credit Rating Company Ltd., Pakistan, Karachi);
(22) Maulana Abdul Sattar Niazi;
(23) Mr. Khalid M. Ishaque, Senior Advocate, Karachi.
The impugned judgments were examined with the assistance of the then learned Deputy Attorney‑General Maulvi Anwarul Haque. A scrutiny of the main impugned judgment would show that opinions of experts, bankers and Ulema as expressed before the learned Federal Shariat Court are contained in paras. 22 to 32 thereof. In their view, time related fixed monetary return on a loan, however, conceived or planned, is to be considered as Riba prohibited in Islam; that there is no difference between? the consumption loans and productive loans so far as the prohibition of interest in Islam is concerned; that the bank interest comes within the definition of 'Riba'; and that Musharakah and Mudarabah arc workable systems for interest‑free banking. Two former Vice‑Presidents of UnitecE Bank Limited and Habib Bank Limited appearing before the learned Federal Shariat Court expressed the opinion that there is no distinction whether the addition on the capital sum of loan is based on simple interest or on compound interest, as any increment in money capital in respect of nothing but time is 'Riba'. They and the other experts were further of the view that Mudarabah and Musharakah are viable alternatives to the banking system. They suggested restructuring of the banking system according to the Report submitted by the Council of Islamic Ideology on the Elimination of Interest from the National Economy to 1980 as well as the Reports of the Permanent Commission for the Islamization of Economy submitted in 1988 and in the later years. They are further of the view that the interest on loans floated by the Government to meet the national requirements also falls under 'Riba' and is prohibited, These experts expressed the opinion that the devaluation or inflation of currency would not affect the payment of loans taken before such devaluation or inflation as long as the loan was repaid in that very currency particularly when the parties to the loan transactions operate in the same currency area. Devaluation of a currency is generally directed at its value in relation to foreign currency, though this may and often does affect its purchasing power at home, especially with reference to imported goods Experts were clear that in domestic borrowing the borrower, whether an individual or the Government shall pay back the same amount which was borrowed with no increase on any pretext because the inflation causing rise in cost and value of gold and consumer goods in terms of currency is the result of circumstances beyond the control of the borrower and he cannot be held to be personally responsible for the loss of purchasing power to the lender. These experts were also of the view that interest‑based transactions between two Muslim countries or between a Muslim and a non‑Muslim country is not permissible because the Qur'anic prohibition of Riba is absolute and does not permit any such exception. Some of the experts, however, conceded that in cases of extreme necessity recourse to interest based borrowing or dealings may be ,permissible as far as international transactions with non‑Muslim countries are concerned. Most of the experts were of the view that insurance business can be easily Islamized as according to Dr. Hasanuzzaman, Islamizing insurance business is much easier to Islamize than the banking system. In this context reference was made by several experts to the Takaful system developed in Malaysia and Islamization of insurance experience in Sudan. The experts, however, differed in their opinion whether the interest accruing on the Provident Fund comes under Riba or not. Some Ulema and scholars, relying on the views of late Mulana Mufti Kitayataullah and late Maulana Ashraf Ali Thanvi and Maulana Ahmad Raza Khan Barelvi, held that the interest on Provident Fund was not Riba. On the other hand, according to most of the bankers and economists such interest absolutely falls under the category of Riba. There was no dispute among the scholars, experts and Ulema that the payment of prizes on Prize Bonds and saving bank accounts and other schemes falls under the category of Riba. There appears also a unanimity of the view that in Shariah there is no difference between interest charged on personal loans and the interest charged on consumption loans. Some scholars provided historical evidence in their respective answers to show that commercial and productive loans were not only known in pre‑Islamic Arabia but the Riba prohibited by the Qur'an was charged mostly on commercial and productive loans. There was also unanimity of views that interest is no incentive for saving as people save for many reasons other than the desire to make more money. They save for their children; they save for their own old age; they save to meet possible contingencies; they save for many other reasons. Savings were made when the banks did not exist. Savings are made by those who do not take interest on their savings and do not accept any return on their holdings. However, the Shariah modes of financing will replace the interest and will continue to serve as an inducement for saving.
The contentions of the learned Advocates for the parties have been summarized in paragraphs 34 to 54 of the main impugned judgment. The contentions of Mr.Khalid M. Ishaque, noted in paragraph 38, inter alia, are that there is considerable juristic opinion available to the fact that an increase to offset the inflation has legal justification and cannot be counted as Riba; and that there is juristic opinion available to meet the fact that Bank interest does not fall in the category of prohibited Riba as the Banks participate in the productive process, make productive labour possible, increase social wealth and take only a fraction of the profit that accrues to them which is not Riba.
The contentions urged and the issues raised by Mr. S.M.Zafar, appearing for the Banking Council and the Federation were noticed in paragraphs 48 to 53 and 130 to 133 of the main impugned judgment. As regards contention that 'Riba' falls within the area of 'Mutshabehat', learned Judges of the Federal Shariat Court discussed the meaning of 'Mutshabehat' in the Qur'an and concluded that 'Riba' did not fall under the area of 'Mutshabehat' and its prohibition was clear and expressed. The literal and technical meaning of 'Riba' in paragraphs 65 to 129 was discussed and elaborated. A number of definitions of 'Riba' given by the earlier writers on Islamic Law as well as the relevant Qur'anic verses (Ayats) and Ahadis of the Holy Prophet (p.b.u.h.) have been noticed in the impugned judgment to answer the question whether the interest on commercial loans falls under the category of Riba and the view recorded is that the purpose for which a loan is advanced does not create any distinction as far as the prohibition of 'Riba' is concerned. The misgivings expressed by certain quarters have been dealt with in paragraphs 134 to 139 of the main impugned judgment. The concept of public policy (Maslaha) and its impact on the legality or otherwise of the bank interest has been discussed in paragraphs 140 to 152 of the main impugned judgment and it was concluded, after quoting the well-?known authorities on Islamic Law and Jurisprudence such as Imam Ghazah that the rule of public policy (Maslaha) cannot be invoked in support of the plea that bank interest should be permissible. The questions of inflation and indexation have been examined in detail in paragraphs 153 to 168, 174 to 177, 198 to 205, 212 to 221, 226 to 234 of the main impugned judgment. It is pertinent to note that while discussing the question of indexation the question of coins or fulus and their legal status and allied questions have been dealt with in paragraphs 169 to 173, 189 to 196, 206 to 211, 225 and 226 of the main impugned judgment. Important rules governing loans and credit and the fact of coins becoming stagnant or the value of the currency getting depreciated or devalued have been discussed in paragraphs 178 to 197 of the main impugned judgment. The examination of the laws impugned before the Federal Shariat Court is to be found in paragraphs 234 to 354. The subject of previous and existing contracts and obligations has been dealt with in paragraphs 355 to 365 and the discussion on the excuses/reasons advanced on the basis of international situation is contained in paragraphs 366 to 378. This completes the survey of the main impugned judgment in these appeals.
At this stage it would be appropriate to give a comparative statement quoting question‑wise opinion/answers submitted by Mr.Sartaj Aziz who was, at the time of filing of replies, Finance Minister, though the said opinion was given in his personal capacity, but as it is representative of the view‑point of the opinions expressed by one shade of Economists/ Scholars, as well as the answers/opinions submitted by Islamic Development Bank, Jeddah, which represents the views/opinions of the opposite group of scholars/economists, are being reproduced hereunder:‑--
Question No. l
The Holy Qur'an has prohibited 'Riba'. What is meant by this term? What is its true definition and connotation in the light of the Holy Qur'an and Sunnah of the Holy Prophet (p.b.u.h.)?
Reply of Mr. Sartaj Aziz
RIBA: There is no doubt that the Holy Qur'an has prohibited Riba. The term Riba has been variously defined by different schools of thoughts. There is need for an authoritative definition of the term 'Riba'.
In Arabic language 'Riba' means an increase but every increase, on money lent does not automatically become Riba. In order to come within the term Riba, such return would have to reflect exploitation of the borrower by the lender.
Any form of exploitation is repugnant to teachings of Islam and that includes exploitation of the lender by the borrower. The lender has been permitted in Qur'an to receive back the principal sum (pas‑al‑Mal). The introduction of paper currency has made it difficult to protect the real value or purchasing power of money. Inflation systematically and continuously erodes the purchasing power of paper currency and, therefore, it would be unfair to the lender if the borrower were to return the same amount of money, with reduced purchasing power to the lender after a period of time. This would amount to exploitation of the lender by the borrower. If the principle of protecting the value or purchasing power of money is accepted, then any payment which is made in addition to the principal amount, in order to compensate for the fall in value, cannot be termed excess or `Riba'.
Reply of Islamic Development Bank
In its decision No.3 for 1406H, the OIC Fiqh Academy defined the Sharia'h prohibited Riba.
Question No.2
What is the true scope of the transactions to which the bar of Riba is applicable? Can the term Riba be also applied to the commercial or productive loans advanced by the banking and financial institutions and to the interest charged thereon?
Reply of Mr.Sartaj Aziz
Interest charged by banks and financial institutions has three main elements;
(a) Compensation for the loss of purchasing power in the value of money. In most countries, the rates of interest prevalent for banking transactions closely follow the rates of inflation;
(b) Charges for services rendered. In addition to providing loans, the Banks generally render a wide range of services to their clients; and
(c) Some return or profit on the amount lent. A portion of this, in turn, is passed on to depositors who keep their money in Banks.
Each of these components can be estimated and charged separately but in practice these are averaged in the light of prevailing trend and revised periodically in response to the demand and supply of money in the market.
If the principle of protecting over time, the real value of money advanced by a bank as loan, is accepted, then interest charged by banking and financial institutions in Pakistan to that extent should not come within the definition of Riba.
Interest charged by Banks is also controlled directly or indirectly by the Central Bank. In Pakistan, this function is performed through State Bank of Pakistan which takes into account several factors of national importance i.e. need to control inflation, sustained economic growth and orderly monetary expansion. If the principles are judiciously observed, there will be no element of exploitation of the borrower by banks and financial institutions.
Reply of Islamic Development Bank
For an answer to this question, Decision No.3 for 1406H of the OIC Fiqh Academy should be consulted.
Question No. 3
The Pakistani banks and some financial institutions finance their clients on the basis of buy .back on mark‑up agreements. According to this method the client of the Bank purports to sell a particular commodity to the bank, and simultaneously buys it back on a higher price on deferred payment basis. A certain rate of mark‑up (per cent. per annum) is applied to the second sale. Does this arrangement fall within the. ambit of Riba?
Reply of Mr.Sartaj Aziz
As regards buy‑back and mark‑up, the Federal Shariat Court has ruled that the system of mark‑up, as in vogue in Pakistan, is repugnant to the Injunctions of Islam (Para. 262 of the judgment).
The mark‑up system is based on the well known Islamic concept of Bai Maujjal which is accepted by all Fiqahs as permissible. After the Federal Shariat Court Judgment, and, taking into account the observations of the Shariat Court, the Commission for Islamization of Economy appointed a Working Group to review the existing practices. They have now come up with recommendations for modifying the system. Under the revised system, banks will not buy the goods from the customer and sell them back to him. The bank will finance transactions where the customer intends to buy goods from the market (including import from foreign countries. He will provide a list of the required goods to the bank and the bank will purchase and supply them to the customer on deferred payment (Bai ffuajjal) basis. The price at which the bank sells the goods to the customer on deferred payment will be worked out on cost‑plus or marked up basis. Under the proposed system the objections raised by the Shariat Court will be rectified as there will be no sale of goods by the customer to the bank and its buy‑back from the bank by the customer as in the present practice.
Reply of Islamic Development Bank
In a similar transaction, the OIC Fiqh Academy put as a condition on . the legitimacy of the second sale transaction that it should be concluded with a party other than the party in the first sale transaction. As an example, if a person sold a specific commodity in cash, then he happened to have found the same commodity with another person and brought it from him on credit, both contracts are legitimate and correct.
Question No.4
Is there any difference between a Muslim and a non‑Muslim in the matter of prohibition of Riba? Can the prohibition of Riba be extended to the loans obtained from non‑Muslim, or for that matter, from Muslim foreign countries whose laws and national policies, together with international monetary laws and policies, are not within the control of the State Bank of Pakistan?
Reply of Mr Sartaj Aziz
This is a matter which needs discussion with religious Scholars. However, Injunctions of Islam cannot be imposed on non‑Muslims. If a Muslim has to borrow from a non‑Muslim, he must accept the lender's terms and in the present.‑day‑world, all money‑lending transactions are interest‑based. Even in the times of Holy Prophet (peace be upon him), there we‑re instances of interest having been paid to non‑Muslim lenders. This supports the view that in case a Muslim (or an organization in an Islamic country) has to borrow, out of necessity, from a non‑Muslim person or organization, the terms of the transactions should be governed by the agreement entered into by the parties.
Reply of Islamic Development Bank
Regarding interest‑based borrowing from other foreign countries, we mentioned earlier the cases in respect of which the prohibition is waived under the general juristic rule of "Necessity".
Question No.5
The Government of Pakistan and some institutions under its control acquire loans by issuing bonds and certificates etc. and pay a fixed period‑wise `profit' to the holders of such securities. Does this profit fall within the definition of Riba?
Reply of Mr.Sartaj Aziz
A "fixed period‑wise profit" does not automatically fall within the definition of `Riba' if it does not share other characteristics of 'Riba', the most important of which is its exploitative nature. Government, as the borrower, cannot be exploited by the lender (public) as Government is more powerful. All the Government borrowings are at a rate fixed by the Government i.e. the borrower. Lender i.e. the public is in no position to dictate or impose its terms on the Government. It would be difficult for the Government to borrow on Musharika or other Islamic modes because most citizens who want to invest their savings in Government Savings Schemes or bonds want a predetermined and fixed return.
Reply of Islamic Development Bank
The answer to this questions has been given in the decision of the OIC Fiqh Academy No. 60 (5/11) for 14 1 OH.
Question No.6
It is evident that the value of the paper currency has a trend of decrease in the inflationary situation. If a debtor who has borrowed a particular amount of paper currency repays the same amount to his credit after a substantial time, the creditor can suffer the effect of inflation if he demands his debtor to pay more in order to compensate him for loss of value he has suffered, can this demand be treated as a demand of Riba?.
Reply of Mr.Sartaj Aziz
As explained in answer to Question 1, the introduction of paper currency has led to persistent inflation in the modern world, thereby continuously eroding the real value or purchasing form of money. There are other causes of inflation also. In an inflationary situation, compensation for depreciation of money over time in a period of inflation would be justified. If compensation is not given in such a situation it would tantamount to penalizing creditors or savers, including those with small means. A clear consensus on the subject of indexation is, therefore, necessary to clarify that any compensation paid for the loss of value is not 'Riba'. The concept of compensatory cost as provided in section 35 of C.P.C. has not been held by the Federal Shariat Court to be contrary to Injunctions of Islam.
Reply of Islamic Development Bank
For an answer to this question, please refer to the answer of the Fifth Question addressed to the Islamic Development Bank.
Question No.7
If all the forms of interest or mark‑up are held to be repugnant to the Islamic Injunctions, what modes of financing do you suggest for: (a) financing trade and industry; (b) financing the budget deficit; (c) acquiring the foreign loans; and (d) similar other need and purposes?
Reply of Mr.Sartaj Aziz
(a) As far as trade and industry are concerned, Pakistani banks have already introduced non‑interest‑based modes of financing which arc being constantly modified and improved to meet the objections of Shariah experts. The latest modifications being introduced at the instance of the Commission for Islamization of Economy will bring about further improvements.
(b) Budget deficit is financed by Government borrowings in the shape of various instruments floated by the State Bank of Pakistan and under the Savings Schemes. As discussed in reply to Question No.5 above borrowings by the Government on interest or fixed pre? determined rate of return should not come within the definition of Riba.
(c) As far as foreign loans are concerned, we are in no position to dictate terms to the foreign lender and have to accept loans on their terms or go without them. These foreign loans are always interest? based and it is not possible for Pakistan to insist that they give us loans without interest. Pakistan has total outstanding foreign loans of about $17 billion on which the annual debt servicing liability is about $1.6 billion. This is expected to increase to over $2.0 billion in the next 3 years. Pakistan has to borrow at least $2 billion a year in the next few years to service these loans since it is not in a position to become a capital exporting country.
(d) Pakistan has already made good progress in introducing various Islamic modes of financing for different financing transactions. Further improvements will be introduced on the basis of the Report of the Commission for Islamization of the Economy referred to above. However, a clearer and more flexible definition of `Riba', on the lines suggested in answers to. Questions Nos. 1, 2, 4, and 5 is necessary to maintain a viable financial system which can co‑exist with and do business with the rest of the world.
Reply of Islamic Development Bank
Distinction should be made between interest‑based transactions on the one hand, for which decision of the OIC Fiqh Academy No.3 for the year 1410H should be consulted, and those based on mark‑up added to the actual cost of the commodity sold, on the other. This second category of transaction is one of the Shari?ah‑complaint modes of financing; it is embodies in a legitimate Murabaha contract, in addition to Istisna', Salam, leasing, Musharaka and Mudharaba contracts, as we explained in our previous answers.
Essentially, all Islamic modes of financing are, by definition, interest‑free. Thus the door is open for utilizing legitimate modes of financing, whether to finance trade, industry, budget deficit or to obtain? foreign financing. These modes are based on one of three principles partnerships, leasing contracts and instalment sale contracts. In the following paragraphs, we intend to recommend particular modes for financing particular transactions, although the door is wide open to select, without any restrictions, any of these modes. For more details, please refer to our response to the second question of the questions addressed to the Islamic Development Bank.
A. MODES FOR FINANCING COMMERCE AND INDUSTRY
Under this mode, the financier buys, at a specific cash price, a certain commodity, which is then purchased by the bank's client at a higher price (i.e. at a profit mark‑up), but on credit.
A sale contract between two parties, in which the payment in respect of a fully described commodity is advanced against a specific future delivery date of such commodity.
3.? Instalment Sale
A sale contract between two parties, the subject‑matter of which is a fully described commodity, in which the commodity is delivered immediately at the time of contracting and the price is deferred until a specific future date.
4.? Istisna'
This is a contract of manufacture between two parties, where one requests the other to deliver him a manufactured commodity according to agreed‑on description/specifications, delivery date, price and date of payment. In this contract, the price may be deferred.
B.???????? MODES FOR FINANCING BUDGET DEFICIT
A contract in which the capital extended is given a pre‑agreed and specific share in the profits; such share is expressed in proportional terms, such as one‑third, half or one‑quarter. This modes could also be realized through the issue of Mudharaba (investment) certificates.
This is the same as a Mudharaba contract, with the difference that in Musharaka both parties participate in management and the provision of capital.
In this mode of financing the financier purchases equipment or fixed assets that generate services in order to lease them to his client.
4.? Murabaha, Salam, Instalment Sale and Istisna'
As it is the case in private companies, Government‑owned enterprises can be financed by way of Mudharaba or Musharaka certificates.
In addition to the above, certificates could be issued to purchase equipment or service‑generating assets in order to lease them to clients.
Certificates could also be issued to finance instalment sale, either on the basis of Murabaha, Salam or Istisna'.
As joint stock companies obtain financing, the Government could do the same, utilizing the same modes. Government could also finance its purchases on the basis of instalment sale.
C. ALTERNATIVE TO FOREIGN LOANS
To provide an alternative to foreign loans, arrangements could be made to issue Musharaka and Ijara certificates to finance projects, especially development projects.
D. MODES OF FINANCING FOR OTHER PURPOSES
Any of the above modes of financing could be utilized to suit the purpose.
Question No‑ 8
If you are of the view that all the forms of interest are prohibited by Shariah, then what procedure will you suggest to eliminate it from the economy? If you prefer a gradual process, what strategy do you suggest for the purpose which may fulfil the requirements of the Holy Qur'an and Sunnah?
Reply of Mr.Sartaj‑Aziz
It is my considered opinion that all forms of interest is not 'Riba' and only interest with an element of exploitation of the borrower by the lender is Riba'. However, even if the
Court were to accept a broader definition ofRiba', its elimination would have to be gradual process. The financial system of country in the modern world is one a large and complex scale and would not be able to withstand drastic changes that violate the basic laws of economics. Also the financial system cannot be evolved in isolation from the world and also in deviation from prevailing political, economic and moral values and norms in a society. For example, a bank will find it difficult to expand its lending on the basis of
Musharaka, in the absence of proper Islamic business ethics and correct accounting procedures. The switch over from conventional to Islamic Banking would have to be pursued gradually keeping in view the positive response of the society to Islamic modes of financing and the costs of transactions and of monitoring. Simultaneously greater flexibility in the definition of Riba on the lines indicated above would make the task more manageable.
Reply of Islamic Development Bank
For the various types of interest and the Sharia'h rules regarding them, please refer to the decision of the OIC Fiqh Academy No.3 for the year 1406H.
Graduation in implementing Sharia'h Injunctions is well recognized in Sharia'h for the general juristic rule on the matter states that "What cannot be entirely attained should not be entirely left". Such graduation, however, requires the existence of a well‑conceived plan and successive or parallel steps, without disturbing the country's economic system. Also, it requires exerting special efforts to protect the integrity of this economic system, its institutions and structure in accordance with the conditions of each country.???????
Any proposed strategic plan for gradual and safe transformation should consist of the following phases:
(1) The first phase would involve examination and modification of those laws related to the future of building an interest‑free economy. It also involves establishing the institutions necessary for developing Islamic banking in an integrated manner, assimilating its modes of financing and building an Islamic capital market. During this phase, dealings would be based on the old and the new interest?-free system. Shari?ah‑based transactions should be given incentives. Orientation seminars should be held, at all levels, to familiarize people with the Islamic modes of financing.
(2) The second phase involves a gradual and balanced cessation of interest‑based transactions at the national levels (i.e within the State's territory). Islamic banks and financial institutions would start to find alternatives for investing their surplus liquidity, and for companies and other organizations in need of financing to find alternatives in the market for exchanging their debts with interest‑ free modes. This would be undertaken while honouring past obligations embodied in repayment of the principal amounts and the interest charged thereon, for Muslims must honour their contractual obligations, ' as pointed out in our answers to sixth question addressed to the Islamic Development Bank.
(3) The third phase involves encouragement of the utilization of Islamic modes of financing in all foreign transactions, cessation of new interest‑based financing (unless in cases of absolute necessity, as said earlier), honouring past obligations and commencing application of an interest‑free financing system to replace the old interest‑based one.
More details on this issue could be found in IDB's response to the fourth question addressed to it.
Question No.9
If all the transactions based on interest are held to be violative of the: Islamic Injunctions, what will be the treatment of the past transactions and agreements? Especially what procedure should the Government adopt with regard to the previous foreign loans?
Reply of Mr.Sartaj Aziz
All the past transactions were based on agreements voluntarily entered into between the banks and their customers which provided for payment of interest. The customer had the choice of taking the money or not and, having chosen to do so and agreed to pay interest, cannot now go back on his agreement and refuse to pay interest having already availed the facility and taken full advantage of the resources provided by the bank. It is also an Injunction of Islam that people who made commitments and entered into agreements must honour them.
Accordingly, if people who try to avoid their obligation to pay interest are themselves committing breach of Islamic Injunctions.
Accordingly, with due respect it is suggested that all the past transactions must be honoured as enjoined by the Holy Qur'an. Banks have been working on the basis of earned income and not recovered income. Thus, all the interest earned by the bank on advances, whether recovered or not, is accounted for in the books of the bank and on that basis returns have been paid to depositors whose money was involved in advances. Thus banks having already paid to their depositors interest on their deposits need to recover interest on advances and if they are prevented from doing so, no bank in Pakistan will be able to survive and the entire economy of the country will risk a total collapse.
As regards foreign loans, this involves not only the sanctity of the agreements made but also the credibility of the country. If Pakistan defaults in payment of interest to its foreign lenders, no further assistance or investment will be forthcoming. Almost every development programme undertaken by Pakistan in public or private depends on foreign loans and assistance which will not be forthcoming if we do not honour our past commitments.
Reply of Islamic Development Bank
Negotiating with creditors may be considered regarding previous interest‑based debts; it would be fine if they accept exchanging such debts with new project Musharaka or Ijara certificates. If such swaps are not acceptable to those creditors, then the principals and interest charged thereon should be paid as this is dictated by the interests of the debtor countries; this would enable them to avoid economic shocks or losing their credibility. The necessity of honouring all previous outstanding financial obligations has been made earlier in our response to the fourth question addressed to the Islamic Development Bank.
Question No. 10
Whether a creditor can fix time and rate of profit while the debtor saying Insha Allah, he will be liable to earn and pay the same in time; failing which the guarantor may give profit asked for plus also a bonus or compensation for delayed payment, if any, and also according to other arrangements regarding the loan. What will be the position if the system of insurance for the said profit is introduced?
Reply of Mr.Sartaj Aziz
Reply of this question was given by Mr.Sartaj Aziz in two parts describing the portion Whether a creditor can fix time and rate of profit while the debtor saying Insha Allah, he will be liable to earn and pay the same in time; failing which the guarantor may give profit asked for plus also a bonus or compensation for delayed payment, if any, and also according to other arrangements regarding the loan to be Question No.10 and portion What will be the position if the system of insurance for the said profit is introduced to be Question No. 10‑A. His Reply to Question No. 10 reads as under:‑‑
"In Musharika transactions the sleeping‑investing partner can fix a share from the income of the joint‑venture and a period at the end whereof accounts would be made and mutual rights and liabilities settled. Third party guarantees, depending on circumstances, are permissible provided elements of ghemar and Ghararare not present in such agreements."
Reply to Question No. 10‑A reads as under:‑‑
The question pertains to the possibility of insuring the losses. If the banks were to work as Baitul‑Ma'1 in partnership with the borrowers after examination of the business that the borrower had decided to set‑up, then it is quite likely that in ordinary times 70% of the businesses would prosper, 20% might suffer losses and 10% might break‑even. The banks would receive their share from each. But to secure themselves against losses the idea of insurance of business losses could be initiated. However, the procedures could be dif; cult. There has been some thinking about insuring the banks against bad loans but no system has yet been developed. However, insurance against losses would appear lawful according to Shariat.
Reply of Islamic Development Bank
Although this question is not quite clear, two issues might be deduced from it, if our interpretation of it is correct:
(1) If the debtor of a legally contracted debt resulting from Murabaha, for example, delayed repayment of his debt and requested its rescheduling, is it legal in this case to recalculate the amount of profit based on a longer repayment period?
(2) In case there is a guarantor for the debt contracted, when the debtor fails to repay on maturity day, leading the creditor to claim his dues from the guarantor, who requests rescheduling the debt amount, is it possible to extend the repayment period in return for increasing the debt amount?
Answer to these two questions was stated in the decision of the OIC Fiqh Academy No. 10 (2/10), which was mentioned earlier.
Regarding the practice of the Islamic Development Bank, in case of Murabaha and instalment sale operations, no additional amount is charged for delay in repayment by the debt or according to the repayment schedule agreed upon. The Bank is currently studying the means through which it could face the losses incurred as a result of such delays in repayment. Regarding leasing operations, the lessee is obliged to pay rent in respect of the entire period during which he benefited from the lease property.
At this stage, it is pertinent to mention that after completion of the 'reading of the judgment of the Federal Shariat Court, Maulvi Anwarul Haq, learned Deputy Attorney‑General, requested that arguments on behalf of the Federation may be allowed to be addressed after hearing the contentions and views of the Economists, Jurisconsults and Religious Scholars as well as the learned counsel for the respondents so that all such pleas and contentions could altogether be replied. This request was not opposed and as such we proceeded to hear the scholars, jurisconsults and economists who chose to attend the hearing.
The contentions urged by the scholars may now be noticed.
Dr. Sayyid Tahir of Institute of Islamic Economy, International Islamic University, Islamabad contended that interest in every form is `Riba' and a lender is entitled to the exact amount he has advanced as loan, under the Shariah, no matter whatever expenses was made in advancing a loan or its recovery. Regarding the loan contracts which had already been executed on the basis of interest, he contended that those should be treated as past and closed chapter. He contended that under the Islamic Injunctions, the contract already executed had to be honoured minus Riba; that contract for debt between two individuals must be based on equality.
Dr.Waqar Masood, Director‑General (Planning), International Islamic University an Economic Expert of the Government contended that the new system has to conform with the change through tremendous re-documentation of the present arrangements in the private sector, but in the public sector it would require many changes in the fiscal system; referring to the banking sector, it was contended that the profit and loss savings were closest to the Islamic banking system and there was a consensus that the bankers need not inform the depositors where their funds were being invested that Mudarbas and Musharkas (finance and partnership) fell into the Islamic concept of investment. Talking about three kinds of coins at the time of revelation of Islam, he said the existing system of coinage was accepted by the Holy Prophet (peace be upon him) and besides gold and silver coins, copper coins were also in use at that time which was later named as "fulus", and the ultimate survivor was the "fulus". He narrated the brief history of different coins and its origins and usages between different people. He said that there were four aspects which affected the currency and this includes inadequacy in backing up commodity (gold. silver); Trust (credibility of the issuing institution); Social, political and economic circumstances; and risk of forgery. He referred to the situation during British‑French War, to state that the people had started withdrawing the gold they had deposited against the currency issued to them and that was the first time when conversion was denied by the Government. According to him indexation is basically motivated to combat the adverse effects of inflation and it (indexation) is no answer to inflation, rather it amplifies inflation. He pointed out that besides the laws noticed in the impugned judgment there are other laws containing provisions as to charging of "interest" and examination of the same is necessary for eliminating Riba and for seeking compliance of Shariah in all facets of economy. Dr. Waqar Masood also referred to the provisions of Constitution e.g. Article 78, 79 and 166, to point out the necessity to enact law with a view to regulate the borrowing by the Government. The written submissions later filed elaborating various aspects of the issues involved will be dealt with while discussing these matters.
Mr.Abu Bakar Chundrigar, Advocate, learned counsel for the Habib Bank Limited; while assisting the' Court on the question of Riba argued that the research carried out by the Muslim Scholars showed that interest does not fall within the connotation of `Riba'. According to him, there is prohibition of Riba in Qur'an but the detailed view on the issue has not been expressed there. He requested the Court to keep in mind all the complexities of the system which affected the economic system and the banks should be compensated against rise in inflation.
Mr.Abdul Jabbar Khan, a Banking Expert (former President of the National Bank of Pakistan), addressing the Court contended that interest was illegal and forbidden in all forms and the Holy Prophet (peace be upon him) had waged a Jihad against interest or Riba and proposed a 16‑Point Action Plan for dealing with the issue of Riba. He informed the Bench that Commission of Islamization of Economy in its report on banks and financial institutions had even drafted circular instructions to be issued by the State Bank to the banks and financial institutions, alongwith formats of legal documents to be executed by the clients financed under non‑interest Banking system. He added that the report of the Commission had also identified how financial steeds could be better met within Sharia parameters. Mr.Khalid M Ishaque, Senior Advocate, contended that all the forms of interest were riot prohibited in Islam and only "Ribs al Nasie" or form of interest which was made compulsory/mandatory or taken by force was prohibited. He contended that the present banking system as a whole could not be termed un‑Islamic and learned Federal Shariat Court has erred in declaring all forms of interest un‑Islamic and it would be in the interest of justice if the case is remanded to the Federal Shariat Court so that the Court can review its decision in view of Injunctions of Qur'an and Sunnah and current banking system. It was contended that 'current Banking System is not above Constitution and its adoption is a compulsion; that a mid way will have to be found as Qur'an's teachings can control the economy of the world; that if a compromise way is not found then our economy would be destroyed like those of Korea, Indonesia, Malaysia and Thailand.
Dr. Muhammad Omer Chhapra, an Economist and Expert on Islamic Banking System, and Senior Economic Advisor at Saudi Arabian Monitoring Agency, dealt at length with the Islamic modes of financing and whether or not the existing Banking System fulfilled the requirements of Shariah. He further submitted that Qur'an has used the word "Ribs" for "interest" whereas there are about 70 different shapes of Riba; that the laws given by the Allah Almighty in Qur'an are final and explicit and there is no other way for Muslims but to subscribe to such injunctions without any hesitation; that it is possible that human mind does not comprehend the benefits hidden in following Islamic system of finance which totally prohibit "Riba" (interest in its all forms) but as the humanity develops these benefits will be felt and surface as bounties of Allah Almighty; that the biggest handicap of the Banking System in vogue is that only the people having valued assets or lands which can be mortgaged avail facility of loan and these individuals in general do not pay interest and mostly usurp the principal amount and in such a scenario the ‑possibility of national development diminishes; that Pakistan should try to attain self‑sufficiency to end crucial dependence on loans from World Bank or IMF as these loans are giving rise to financial instability; that declaring interest as un‑Islamic is not? he real issue instead question of doing away with the interest system is a big ,question which warrants solution; that transactions and profit where risk is not involved come under the definition of interest; that a country can get loans on interest from non‑Muslims in acute emergency, but such loans are devastating for economy of that country; that Islam allows use of Haram for existence. He pointed out that Turkey got loans of about 6.5 billion dollars on interest to improve its economy but the economy did not improve; Pakistan has taken credit of over 30 billion dollars, which would be harmful for economy; that instead of investing reasonable amount in social sector and development projects, the Pakistan Government is allocating only 15 per cent. of its total annual budget; that for elimination of interest‑based system, the Government should implement a judicious economic system, in which the people should be provided equal opportunities in employment, education and health; that charging of interest was prohibited mainly because of the injustice it inflicted upon the poor. Emphasising that in a Muslim society all measures were needed to reduce luxury expenditure both by the people as well as the Government, he dealt with various connotations of investment which, according to him, could be productive, unproductive and speculative. Turning to the interest‑based banking system, he contended that the element of speculation in international market caused diversion of resources from essential investment which was against the principles of Islam, and when consumption rose the rate of savings decreased which in turn limited the Government's ability to provide full employment. He, referring to the United States, where according to him, were negative savings, contended that this was because the dollar was an international currency and a sizable amount was brought back into the United States and in Pakistan's case it was not possible so the rate of savings has to be increased. Giving comparative statistics of the rate of savings, he stated that Pakistan's savings at 13 per cent. were very low as compared to 35 per cent. in Malaysia and Taiwan, and 42 per cent. in China. He added that for the past 100 years the rate of return on equity in the United States was 7 per cent. whereas on treasury it was 1 per cent. and in case of Germany and Japan it was 5.9 and 4 per cent. respectively on equity whereas in the case of T‑Bills the return was wiped out during the world war. According to him it was possible to get a hither rate of return on equities. He dealt with the equitable distribution of resources and contended that despite progressive taxation in the Western countries it was no longer possible to continue with welfare spending such as health, education etc,, and maintained that the modern banking system has failed to finance smaller companies because they could not furnish collaterals; that 56 per cent, of the resources provided by over 28 million depositors went to borrowers who did not pay back. In respect of problems being faced by Japan and the Asian Tigers, he contended that too much money was doled out by the banks to the stock market and when the banks stopped lending, it had a domino effect. The Asian Tigers collapsed because over 50 per cent. of the money had been got from the outside on short term and the banks were lending it on medium ,or long terms, which created problems especially in view of hedge financing and, therefore, $30.3 billion out of a total of $1,490 billion in April, 1998 were transacted for speculate trading.
Dealing with prohibition of interest, Mr. Chhapra referred to the alternatives suggested by Shariah i.e. the primary and more risky modes of Modaraba (passive partnership between the financier and the entrepreneur), Musharakah (active partnership) and shares of joint stock companies, wherein the rate of return is based on the ultimate outcome of a business and not determined in advance and the depositor participates in the risk; and the secondary and less risky modes of Murabaha (cost plus service charge). Ijarah (Leasing), Ijra wa Iqtina (hire‑purchase), Salam (forward delivery contract), and Istisna (contractual production) wherein rate of return is stipulated in advance and the depositor is free from the risks of the business. According to Mr.Chhapra, the bank is a Modaraba and it could lend to a sub‑Modaraba and there is no permission required from the depositor for further lending, and the bank has the right to lend because it is providing the service of keeping the depositors' money in safe custody. Narrating the major problems to be faced by an Islamic Bank he stated that Islamic Bank has to compete with other agencies as it would be very difficult to operate if harsh measures are taken. According to him a person might be imprisoned but no financial burden should be imposed, and the liberal view supported imprisonment and financial penalties as a deterrent by a Court of law to recover the actual damages which include compensatory cost. It was suggested that the law should be changed enabling the publication/circulation of names of defaulters by the bank. On rescheduling of loans Mr.Chhapra urged that it was possible in an interest based economy but in Islamic banking it could be done only for genuine reasons. He asserted that lease contracts must be different from the contracts for the purchase of residual assets.
As regards establishment of banks, Mr.Chhapra urged that 1400 years ago banks did not exist and people knew each other personally and performed trade and transactions among themselves during the period of Holy Prophet; that banks were formed in 15th and 16th centuries and first Islamic Bank was established in 1975 in Dubai and in 1996 there were 166 Islamic Banks in 34 Muslim and non‑Muslim countries of the world.
Summing up arguments, he contended that a Central Shariat Board should be established; that the current Constitutional system of transactions is against teachings of Qur'an and Sunnah of the Holy Prophet (peace be upon him) and it is the Court's responsibility to fix date for gradual Islamisation of system. He contended that new banking system should be started along with old system and later the non‑Islamic Banking System should be eliminated.
Mr. Ebrahim Sidat, a Chartered Accountant by profession, appeared to make his submissions against the continuation of interest‑based banking system and urged that the banking system of the country could be switched over to the Islamic mode within three to six months. According to him, there are no technical difficulties in introducing Islamic modes, it is just the lack of will and determination on the part of the Government. He contended that in order to bring the banking system strictly in accordance with the Islamic framework, Riba‑based investments should be a cognizable offence as unless the Riba‑based investments are made cognizable offences, many people will continue to circumvent it. He, however, added that the existing contracts must be honoured and after a cut off date option must be given for switching over to either of the Islamic modes. It was further contended that certain provisions of the Partnership Act should be amended to get rid of interest, in accordance with the judgment of the Federal Shariat Court; that revaluation of assets should not be done on the basis of book value but on the basis of its real value; that there could be no doubt about the need of doing away with Riba after what had been clearly spelt out in the Qur'an; that Riba is a matter which does not need to be dilated and fears and apprehensions that it cannot be replaced are misplaced; that Riba in all its manifestations was deplorable and the Federal Shariat Court's judgment in this regard was a valid document and it is a matter of regret that after the initial steps in the early 80's the process was reversed and ultimately put on the back‑burner. He referred to State Bank of Pakistan's report in which there is no mention of interest‑free economy. He contended that one of the difficulties being faced in the Islamization of the banking system is that instead of treating Murabaha as a trading device people consider it as a financing instrument; that Modarabas and Musharikas are compatible with venture certificates and the venture certificates are influenced by the Islamic modes and its propriety under Shariah has to be looked into; that private Musharikas are operating successfully and no one is talking about its credibility. According to him Modarabas have become popular because some tax evaders use it as a shelter; and whole export funds are not subjected to tax on profits which provide strong motivation for playing with the figures e.g. presumptive tax. In reply to a question about the format of the accounting procedure under Islamic mode of financing he stated that it would not be different but requires expanding the scope of corporate law for carrying out Shariah audit and since every audit firm would not be having the Shariah experts, it could fall back upon others who possessed the expertise.
Mr.Ebrahim Sidat, like Mr. Chhapra, also recommended that the State Bank of Pakistan should have Central Shariat Supervisory Board to monitor the Islamic modes. He also suggested that not only corporate but private Modarabas should also be allowed to harness the funds available with individuals who lack the expertise but could make profit with the help of some experts citing the case of funds available with the employees relieved of the jobs through golden handshake.
Syed Muhammad Hussain, Chartered Accountant, contended that an authoritative pronouncement in respect of all types of interest, and with whatever name it is called, is required which could legally be implemented without scope for loopholes or misinterpretation; that interest be made a cognizable offence and investment companies should not accept interest ?based funding; that the economic order based on the Holy Qur'an and Sunnah of the Holy Prophet (peace be upon him) is for all times to come and the elimination of interest occupied a key position in the establishment of that order and centuries of colonisation have created doubts among the Muslims about the matter; that all loans taken by the Government from the public by issuing domestic debt instruments with a fixed rate of return/profit as well as the loans taken by the public from the Government‑controlled banks should either be retired or be converted into an interest‑free liability, such as equity; that the Government could request the foreign lenders to change the forms of contracts by replacing the existing interest‑based contracts with those equivalent to Riba‑free contracts as foreign loans contracted with foreign Governments or international financial institutions could not be terminated unilaterally, and if the foreign lenders refuse to do so, the contracts should.be honoured but without creating any further delay in meeting the payment obligations giving the quantum of uncertainty involved in settling the matter with foreign lenders; that the Federal Government should be directed to form a working group with a specific time‑frame to chalk out an action plan for settling the matter with foreign creditors; that mark‑up and interest in the present form levied by the financial institutions on accommodation, bill discounting charges, profit and interest payable on majority of leasing contracts, profit and interest payable on majority of PLS and interest‑bearing deposits and profit and interest payable on majority of Term Finance Certificates (TFC) and National Savings, fell within the ambit of Riba prohibited by Islam; that interest payable on all present treasury bills and bonds, the interest levied on money due to Government on various accounts and the interest and penalties levied by the utilities and other business concerns on amount overdue also fell under the same category. He suggested structural and legal reforms and in this context mentioned Shariat audit, auditing and accounting standards, risk mitigation, trade finance and mark‑up and Murabaha transactions.
Mr.Maqbool Hussain, Chairman Small Group of Companies, in his submissions stated that only paper work was done in Pakistan with regard to Islamization whereas the situation warrants a non‑political autonomous body which not only makes laws in conformity with basic principles of Islam but also supervise the implementation of legislation regarding Islamization. He proposed creation of an Islamic Banking (Planning and Implementation) Board with a mandate to reform the whole, system‑ and suggested that this Board or Commission should comprise jurists, Ulerna, bankers and chartered accountants with a time span of two to five years. He contended Modarba is the only. system through which the economy of Pakistan could be transformed into a viable and credible economic order.
Dr.Shahid Hasan Siddiqui, an Economic Expert and Chairman of the Karachi‑based Research Institute of Islamic Banking and Finance, appeared to state that present banking system is at the verge of collapse while the nationalized banks arc facing bankruptcy. Relying on various circulars and reports issued by, the State Bank of Pakistan which is regulatory body for all banking institutions including Development Finance Institutions, he urged that the successive Presidents of nationalized Banks had issued false and fictitious balance sheets showing increase in profits while in fact the banks have sustained record loss during the last ten years which even exceed the losses sustained during 41 years after independence, and these losses also exceed total profits by the banks in our whole life as a new nation; that interest‑based banking system has failed due to corruption by the bankers and the interest‑free banking system may also face the same fate at their (bankers') hand and in the circumstances the Islamic Banking System may not prove successful; that the auditors who had been certifying false balance sheets of banks/DFIs including those who had certified higher value of assets for rescheduling of advances to sick units should be blacklisted and revaluation of assets should not be used for allowing new finances against the revalued assets. According to him in view of the documentation and declaration of correct profits by entrepreneurs the tax collection would be enhanced while the cost of production would go down as profits would be shared with the banks after the profits were declared. Referring to the Banking Companies Amendment Act, 1997 it was stated? that incentives given under this amendment are "un‑Islamic, unjust and harsh for investors". A high powered commission was also recommended by him to be established for looking into the cases of written off loans involving billions of rupees. He proposed that all modes of deposits, mobilization and utilization thereof must be based, as far as possible on profit and loss sharing system and the Government must restore its credibility by resolving the issue of imposing curbs on withdrawals from foreign currency accounts; that Kissan Bank and a Model Islamic Bank which should operate on 100 per cent. profit and loss sharing basis have to be established which would be able to offer much higher rates of return to the depositors even in the first year of their operation; that all major banks and DFIs should have an Islamic banking division and the same should be upgraded in the State Bank. Dealing with bank advances with up to date mark‑up the economic expert said that no new loan on mark‑up or interest should be allowed with immediate effect and at least 75 per cent. of new financing should be on Musharika, while for old advances he proposed that by January 1, 2000 all mark up or interest‑based advances should be converted preferably into Masharika, if feasible; that in case of old debts there should be gradual reduction, optional conversion to second line techniques of financing and debt‑equity swap, no renewal of existing products and optional transfer to new products on PLS basis as and when these products are developed, while in the context of external debts there should be no interest‑based loans for new financing; and for old debts negotiations for conversion to second line technique of financing and for debt equity swap should be followed; that no interest‑deposits should be accepted, including where, on the instrument, expected rate of profit was mentioned or announced in advance whether formally or informally; that existing deposits should be brought under the new system irrespective of the maturity and for foreign currency deposits the depositor should be given the option to convert it at the average of prevailing open market rates on the date of encashment and the maximum rate in the open market after 1998. He called for establishment of a high powered commission headed by a Judge of the superior Court to examine all cases of rescheduling/restructuring/written off/remissions etc. in the advances portfolio after January 1, 1985 and losses under these heads, according to him, could be as high as over Rs.100 billion; that the commission should be empowered to examine the State Bank's Incentive Scheme to loan defaulters and decide whether it was un‑Islamic, unjust and detrimental to the depositors' interest; the commission should also fix the responsibility of bankers/directors and of the State Bank in respect of 869 cases of loan defaulters, where a sum of Rs.111 billion was involved and examine higher assignments given during the last five years in the Government departments and autonomous corporations to those who had been or were still a defaulter or had committed a fraud. '
Abdul Wadood Khan, Economic Expert reappeared to contend that inflation would reduce by 42 per cent. if interest system is abolished and TMCL based interest‑free banking system is introduced, and there will be more amount available in money market which might be used to repay the loans. He claimed that level of bank deposit would rise with the elimination of interest and referred to Keynes's philosophy of lowering the rate of interest, the higher the level of investment. According to him the elimination of interest would also increase Government's earnings. He also dealt with encashment of premature commercial and treasury bills, liquidity agreement and profit earning by banks. He argued that both Islamic and non‑Islamic Banking Systems should be run parallel so that people can choose the system of their liking. According to him counter‑loan scheme is not against Shariah and it is according to the Hanafi school of thought, and under the Counter Loan Scheme replacement of interest with Time Multiple Counter Loan (TMCL) would convert existing banking system into interest free banking system without any disruption, and upon banning of interest, the existing banks would stop giving loans on interest or mark‑up and would commence providing loans on TMCL basis and would start negotiations for converting existing interest‑based or mark‑up based loans into TMCL‑based interest‑free loans. In the context of conversion of depositors accounts he argued that the depositors would be given the option to keep their money in demand‑deposit or investment deposit. Demand deposit, according to him, would not get any profit or incur any loss but in investment deposit the bank would share the profit and loss with the account holders.
Maulana Hafiz Abdur Rahman Madani, a religious scholar argued on prohibition of Riba in Islam by the Holy Prophet (peace be upon him) narrating the background and time of prohibition of Riba. According to him Riba was evolutioned in four stages as four different verses of' the Holy Qur'an were revealed at different times and one of the last verses of Qur'an revealed oil Holy Prophet (p.b.u.h.) includes the prohibition of Riba strictly. It was contended that all the verses related to prohibition of interest (Riba) are incumbent upon Muslims; that it would be wrong to say that the Holy Prophet (p.b.u.h.) had left anything unexplained while teaching the people about prohibition of all kinds of Riba. Talking about the definition of Riba, Maulana Hafiz Abdul Rahman Madani referred to Imam Sarakhsi's definition of Riba to the effect that Riba is a conditional increase in sale agreement which has no counter value and proposed certain amendments in the same. According to him Riba is the agreement where conditional increase is without matter of right. He argued that time and currency have wrongly been defined as means of productivity as currency will become asset when it will be changed into, commodity and that it only represents value. He insisted on promoting ?Ijtehad" in Islam which is an essential part of Shariah but it needs a big effort and brain storming. According tar him there are few aspects which were not properly addressed by the Federal Shariat Court and it is now the duty of the Supreme Court to take care of them while resolving the issue. Hr was of the view that existence of Western laws besides Islamic laws is creating problems.
Prof. Khurshid Ahmed of Jamate Islami who is heading Institute of Policy Studies and Islamic Foundation in UK appeared to state that Europe was considering the interest‑free banking system, given by Islam as an alternative for a number of credit‑related problems. He referred to a Drench Nobel Laureate who had given a new concept of banking system specializing only in three sectors, including banks accepting deposits, investment banks and banks for business purpose, whereby the credit problem created throughout the world could be overcome. He argued that it is the foremost duty of the Parliament to Islamize the existing financial system of the country; that the Governments in Pakistan lacked political will and neglected the work already done for the transformation of the existing banking transactions into interest‑free system; that the plea of the Government against the Federal Shariat Court judgment to suggest alternative banking and financial system without usury was unconstitutional and by filing an application in the Federal Shariat Court for suggesting measures to implement its judgment, the Government did try to unload its burden: that the Council of Islamic Ideology and different institutions had done; a lot of work in this regard and the efforts by these institutions were appreciated abroad and many awards were given by the Islamic Banks to them but the Government was paying no heed to it; that Islam approved profit or kiss sharing on any investment for the purpose of production as it ensured growth, distribution of justice and stability, but the present interest‑based economic system had only encouraged exploitation; that the IPS Chief insisted that the authority to create credits should be with the central bank and the Government only, and not with other banks and interest system had created a havoc in the world specially in the third world. He cited the example of Brazil and Pakistan. In 1985, according to him, Brazil's total debt was $80 billion out of which it had already payed back $21 billion but still indebted to $221 billion and Pakistan, which owed a total foreign debt of $6 billion in 1978 and had paid $22 billion but still indebted to $35 billion. According to him 40 per cent. of the total loans in the world was non‑performing and in Europe 97 per cent. money in circulation was the bank created money because of which rich had become richer while poor dipped to new lows. He also cited the example of 200 banks practising interest‑free banking to 40 countries having assets of $600 billion with $80 billion of deposits and asset transaction of $200 billion. It was urged that 15 per cent. of Kuwait and 5 per cent. of Malaysia's economy was based on interest‑free banking; and that it was wrong to suggest that our economy would collapse if we adopt the interest‑free system instead it would collapse if we fail to adopt the transition phase. As Pakistan is normally bound to honour the international commitments, he was, therefore, not in favour of cancelling the same. He was of the view that it would take a year to completely transform the domestic debt into the new system while two to three years in respect of international agreements. He suggested that we should endeavour for debt restructuring with the World Bank with open minds as the World Bank has already been dealing with 31 countries on debt restructuring because the loan giving agencies benefited 70 per cent. by the loans they advanced, while the countries which received loans benefited only to 30 per cent. Besides, these loans were also used for corruption purpose.
Prof, Nawab Haider Naqvi, an Economist, argued that we do need an Islamic economic system if only to end the current schizophrenic confusion between what we believe in and what we practise; that it is possible to construct an Islamic system, complete with its own ethical values, policy objectives and policy instruments, which alone can satisfactorily explain the economic and social behaviour of Muslims but it has to be kept in view that the Islamic system to be constructed will be as man‑made as any other system and as such the task of translating the timeless, institution‑free Divine ethical and economic principles into a workable economic system will have reference to specific time and applicable within the matrix of specific institutions and will have infirmities as it will be made by men/women themselves and naturally the end‑product of these efforts will bear the mark of human imperfection. This necessitates the gradual approach ac Islamic economic system will emerge gradually out of a prolonged interaction between the Islamic ideal and the reality in the Muslim countries. Professor Naqvi argued that the two issues which arise before this Court are (i) equivalence of Riba and the bank interest in modern times and (ii) the optimal replacement of interest‑based banking by profit based banking i.e. by a banking system raised on the principle of universal Profit and Loss Sharing (PLS), unsupported by any guaranteed return on bank deposits or bank advances. He added that both these questions are very difficult to answer as interest‑free banking is a property of a full?fledged Islamic economic system but not of capitalism, where interest and profits are inter‑linked like the Siamese twins and economic studies show that changes in the profit rates have been caused by changes in the interest rates, speculative trading, and in productivity. Separating the two would require nothing less than an intricate surgical operation upon the economic structure, of which the consequences are not known with certainty. He explained that once fixed rate of return instruments are altogether abolished in a capitalist economy, we do not know the outcome of such a step; so that the new profit‑based system may as well take us nearer to, or farther from the Islamic ideal of Adl‑o‑Ihsan. He posed himself the question: "Does the PLS system offer a ready‑made workable Islamic alternative to the modern?-day banking interest?" His answer was that contrary to the widely held opinion which is also reflected in the impugned judgment, the PLS alternative alone does not necessarily guarantee an Islamically acceptable outcome in terms of its efficiency and equity. The theoretical reason in support of the answer that a negative outcome is more likely when profits are substituted for interest is the empirical evidence on the working of the Islamic Banks in the last 15 years or so. According to him a shift from the present interest‑and‑profit financial system to an all‑profit financial system will, in general, lead to a worse equity outcome. It may increase, rather than decrease, the size of the perverse flow from the poor to the rich, even more than the present capitalist system does. He maintained that in the new system the risk averse savers/investors will be crowded out of the market unless, of course, they can anticipate with complete confidence that they will always get a higher reward in such a system which has a contradiction. So the reform of the banking system in the name of Islam may take us from one capitalist hell to an even hotter hell, and that too without interest. Professor Naqvi was also of the view that a system based on profits i.e. variable rate of return is not likely to be more efficient than the one based on interest?cum‑profits in view of the following prevailing circumstances:‑‑
(i) In monopolistic/oligopolistic market structures, which also characterise Pakistan, profits impose an "excess burden" on the society in the form of lower production and higher product prices than would be the case in the textbook capitalist world of free and perfect competition.
(ii) The Islamic Banks will tend to under‑invest in a large number of projects where social profitability is higher than private profitability i.e. public infrastructure. education and public health etc? for the reason that investment in them does not yield immediate and large profits. So, more investment will be made in high profit‑yielding projects whose social profitability is very low or negative e.g. investment in wasteful luxuries. Such high‑profit investments may not be sanctioned by Islam because they come in the category of Tabzeer.
(iii) The moral hazard problem i.e. when due to information asymmetry, the Mudharib cheats the Raul‑mal is large in a banking system based on the PLS principle.
Professor Naqvi' pointed out that without finding a reasonable solution of the fore‑noted problems, the PLS‑based system will neither be efficient nor equitable. Moreover. PLS system will not be preferred by the public unless perfect honesty prevails a condition which is observed more in the breach than in the observance in the real world and the situation where the investors almost never share true information about their profits with the banks, as is the case of Pakistan, a universal PLS banking would almost certainly face a complete break‑down. Mr. Naqvi further stated that in the Survey conducted by Islamic Research and Training Institute of Islamic Development Bank, 29 major problems which are being faced by the Islamic Banks have been listed. The essence of these findings/problems are:‑‑--
(a) The rate of return offered by the Islamic Banks has been generally lower than the interest‑based banks where they coexist with the interest‑based banks; as well as in Pakistan, Iran and Sudan, where they have completely replaced the interest‑based Banks.
(b) The loan defaults have increased dramatically since the introduction of the Islamic Banks which appears to be powerless in dealing with such cases as effectively as the interest‑based Banks used to do and the size of the involuntary resource transfer from the poor to the rich is much bigger in a PL.S system than in an interest‑based system.
(c) The incidence of the moral‑hazard problem is pervasive. Indeed, it threatens the very fabric of Islamic Banking? especially in Pakistan. In Iran, the banks have not been able to invest more than 3Rr% of their total assets after the introduction of Islamic Banking.
(d) Due to moral hazard phenomenon, the Islamic Banks have generally lavoured fixed rate of return type financial instruments like Murabaha and leasing. According to the i996 issue of "the Directory of Islamic Banks (Jeddah)". the sale of lease based financing account for more than 80% of total financing of the Islamic Banks, and the PLS type financing represents only 20% . His conclusion was that notwithstanding the optimality of these modes from Shariah point of view, the PLS financing has not been preferred by the public and the banks so far.
(e) Heavy concentration of the Islamic Banks' portfolios has made their asset structure highly unstable, as they cannot minimize their risks.
(f) The investment portfolios held by the Islamic Banks are typically loaded by trade‑related activities. As of 1996, agriculture and manufacturing together accounted for only 26% of their lending activities. while 74 % was accounted for by Trading (31 % ). Services (13.12 % ), Real Estate (11.67 % ), and others (17.62 % ). Also, the investments made by the Islamic: Banks are of even shorter duration than is the case with the interest‑based banks. The longer‑term investments have generally suffered.
Professor Naqvi submitted that despite the fore‑noted empirical evidence about the working of the Islamic Banks he is not claiming that the Islamic Banking should be scuttled as his point of view is that we should do everything feasible to improve its efficiency and equity, but it is important that undue haste is avoided in making it perfectly acceptable from an Islamic point of view. So, no precipitate steps should be taken to further Islamize the Islamic Banks until the relevant information on their actual working has been fully analysed and that it should be accepted that the PLS‑based financial instruments, like Mudhariba and Musharika are totally inadequate to meet all the financial needs of a modern society and minimum element of fixity is essential for modern financial institutions, including the Islamic ones; and that the present mark‑up and other sale‑related instruments should be treated as essential aspects of Islamic Banks, at least for now. According to him these are presumably second‑best options for the Islamic Banks to safeguard the depositor's money in view of the widespread moral hazard problem, and to meet the borrower's preferences. He argued that if as decreed in the impugned judgment, the mark‑up system is abolished forthwith and replaced by the PLS principle, then it will seriously destabilise the banking system. Mr. Naqvi was of the opinion that the guiding principles of Islamic Banking should be‑‑‑
(a) to safeguard the interests of the depositors as opposed to those of the borrowers of the loan able funds;
(b) to minimize the information cost of its operations by not relying excessively on the borrower's honesty, which is a scarce resource in any society, but especially so in Pakistan;
(c) to do risk minimization and perform such essential functions as financial intermediation, increasing private saving etc.
On the question of indexation of public borrowing Professor Naqvi criticized the observation made in paragraph 42 of the impugned judgment that inflation did exist in the early Islamic period as prices rose by 15% during the period of Khulafa‑e‑Rashideen and Imam Yusuf. He pointed out that such an observation could not have been recorded had any Economist pointed out that 15% increase in the price level over a period of more than 100 years comes to less than 0.145 per cent. per annum, which is really a zero inflation rate. He referred to page 136 of his book titled "Islam, Economics, and Society" wherein the Scheme proposed to meet the problem is that the rate of indexation should be equal to the current or expected rate of inflation plus an amount equal to the increase in the Gross Domestic Product due to the contribution of capital. The results of the calculation on the basis of this formula are given in the following Table:‑‑----
"Table I
Calculation of Rate of Indexation (Return)
Year???????????????? Inflation??????????? GDP Growth??????????????? K Share in??????????????????? Rate of
??????????????????????? Rate???????????????? Rate???????????????????????????? GDP\??????????????????????? Indexation
1990‑91?????????? 12.66?????????????? 5.57???????????????????????????? 0.69???????????????????????????? 16.50
1991‑92?????????? 10.58?????????????? 7.71.??????????????????????????? 0.69???????????????????????????? 15.90
1992‑93?????????? 9.83???????????????? 2.27???????????????????????????? 0.69???????????????????????????? 11.40
1993‑94?????????? 11.27?????????????? 4.54???????????????????????????? 0.69???????????????????????????? 14.40
1994‑95?????????? 13.02?????????????? 5.24???????????????????????????? 0.69???????????????????????????? 16.63
1995‑96?????????? 10.79?????????????? 5.19???????????????????????????? 0.69???????????????????????????? 14.37
1996‑97?????????? 11.8???????????????? 1.30???????????????????????????? 0.69???????????????????????????? 12.7
1997‑98?????????? 7.81???????????????? 5.44???????????????????????????? 0.69???????????????????????????? 11.57
Averages????????? 10.97?????????????? 4.66???????????????????????????? 0.69???????????????? `?????????? 14.18
@Estimated by the World Bank
\ Rate of Indexation = Inflation Rate + (GDP \ K share in GDP)"
This Table shows:
(i) The rate of indexation does not necessarily increase with time alone so it is not true that the longer the period the higher the rate of indexation. It was pointed out that the rate of indexation would have been 16.50% in 1990/91 when the GDP and the inflation rate were higher, but only 11.57% in 1997‑98 when both were lower.
(ii) The rate of return due to indexation is not pre‑determined in any way nor can it be predicted with complete certainty.
(iii) The rate of indexation is related to the increase in the flow of goods and services in the economy.
So, the proposed indexation formula does not satisfy any of the features of Riba identified by the Fuqaha.
On the question of equivalence of interest and Riba, Mr. Naqvi maintained that in view of the clear Qur'anic injunction there is not much room left for intellection or debate if we accept that interest, including bank interest, is Riba but it can still be asserted, as it is his case, that Riba is not just interest, muchless only bank interest; but that it signifies all exploitative relationships which have the effect of transferring resources from the poor to the rich. He added that there may be an identification problem here because bank interest does not satisfy at least some of the basic criteria of Riba. Professor Naqvi though seemed reluctant to enter this controversy as to the meaning and scope of the term Riba but after dealing with the characteristics of Riba noted in paragraphs 94 and 113 of the impugned judgment which are‑----
(i) the amount to be repaid in excess of the principal amount at the end of the contract period is fixed in advance in relation to time by the lender as an essential condition of the loan;
(ii) the amount so stipulated is risk‑free;
(iii) it involves no uncertainty; and
(iv) it causes a net transfer of resources from the poor to the rich, which is considered as the raison de etre for the prohibition of Riba in Islam, made the following comments:‑‑‑‑
(i) Contrary to popular conception, the interest rate need not always be fixed in advance and be risk‑free. Such is the case only if the investor makes decisions under conditions of perfect certainty, which is seldom the case; but will not be so if uncertainty prevails, which is almost always the case. In the latter case, the interest rate will consist of a risk‑free rate plus a risk premium, which will be variable depending on the degree of uncertainty at a given time and on the changes in it over a period of time. Indeed, Euro‑dollar syndicated borrowing, which includes a tisk premium over the London Inter‑Bank Offer Rate (LIBOR), is both variable and risky; which makes it worse than the borrowing done at a fixed rate, on a Government‑to‑Government basis.
(ii) Risk and uncertainty do not necessarily constitute an Islamically legitimate characteristic of interest in the meaning of Riba. Indeed, if these were desirable characteristics of an Islamic instrument then these would have to be maximized. But this is not the case, because Islam has declared gambling, betting, speculation as Haram (Just think of the State of Monaco and the city of Las Vegas shining examples of an Islamic economy).
(iii) While fixing of the rate of return in advance may attract Shariah's prohibition, it is not generally true that bank interest causes a perverse transfer of resources from the poor to the rich. This is difficult to establish one way or the other; but whatever evidence exists shows that, because of an initial unequal distribution of income and wealth, both the profit and interest incomes accrue, more to the rich than to the middle and lower middle‑income groups. More shall be given to those who have more! However, Table 2 makes clear that, relatively speaking, interest income is more important for the low income group than profit income; the reverse is the case for the high income group.
Table 2
Distribution of Income from Interest and Profit
among Households in Pakistan (1996‑97)
%o of Total @???????????????????????? Income Group????????????????????????? Interest Income Profit
Income???? Household???????????????????????????????????????
26.57?? 54.65?????????????????????????? Lowest???????????????????????????????????????????????? 7.53???????????????? 6.91
24.33?? 24.26?????????????????????????? Low???????????????????????????????????????????????????? 18.55?????????????? 16.85
49.10?? 21.09?????????????????????????? Middle + High????????????????????????????????????? 73.91?????????????? 76.28
Source: Computed from the Income and Household Survey 1996?97.
@ Column based on the 1990‑91 Survey
It was contended that the point is that Islamic reform does not aim at abolishing interest income but to convert it into profit income; which reform, if implemented, would then leave the distribution of income between income classes unchanged. To reverse the perverse flow of income the remedy is a more equitable distribution of wealth holdings`, 'through an effective tax‑cum‑subsidy scheme in which the interest and profit incomes are taxed, the former at a higher rate than the latter; and the tax proceeds used to compensate the losers in the market place.
Mr. Naqvi concluded that Musharika and Mudharaba instruments should be sparingly used on rational grounds, both by the consumers and the banks and that it would do incalculable harm, if modern banking were made to fit in the Procrustean bed of anachronistic ideas and practices. He pleaded that nothing should be done to do away with the present mark‑up system, which is Islamically legitimate. The small saving schemes must be left as they are till a more satisfactory solution is found, and Government borrowing from the banking system on a fixed return basis may be declared as not interest, as in Iran, alternatively, the indexation system as is proposed by him may be tried. He added that this Court may focus attention on building fences around the present Islamic banking system by punishing dishonesty, by making loan default a social crime, by making honouring of voluntarily agreed contracts mandatory, by promoting respect for private property rights where their exercise does not conflict with similar rights of others only, then Islamic values are effectively internalized that Islamic Banking, based on the PLS principle, will have any chance of becoming operational, even on a restricted basis.
.
Mr. Iqbal Ahmed Khan, Managing
Director, Global Islamic Finance HSBC Investment Bank Plc, London, a foreign expert, appeared to express his views. He provided a global perspective on the ethical, indigenous and equitable form of finance, which stands around US $90 billion and is growing at the rate of 15 per cent. per annum. According to him
Islamic Finance Industry is spread across 65 countries with the total population with around 1.3 billion; that it is a trend, which is broadening the ownership base, creating more stakeholders and therefore bringing the hope of stability in the Muslim countries; that in a broad sense Islamic finance today provides a moral version of modern capitalism. In orderto create a macro economic context he provided the Bench with World Bank statistic which measured the world economy in terms of the goods and services for the year 1997 to be around $7 trillion while the financial flows were well in excess of $500 trillion.
He clarified that the Islamic finance industry was embedded in the commercial value producing real economy; that the rise of financial, capitalism is pinning
Wall Street against main street; that today 80 % of the wealth is concentrated in the hands of 20 % of the world' people. Commenting on this disparity of wealth distribution, he said that the invisible had has not worked very well and quoting a reverend Bishop he urged that the rich seem to be getting richer, the poor poorer and we are not getting any holier. Looking at the world with a detached, view from another world one can find majority of economic and social activity to be creating pockets of affluence in the sea of ever‑increasing poverty: On the increasing polarization in the world economy he quoted Larry
Summers the US Assistant Treasury Secretary who said that the world economy is linked with the US economy; that the health of the US economy is dependent on the consumer spending in the USA; that consumer spending is reliant upon the performance of the US stock market; the stock market;?
fate is linked to the performance of around 50 blue chip companies listed in New York Stock Exchange, which according to him is an evidence of the polarization in the world economy. On philosophical foundation and core concept of Islamic finance he pointed out that the foundation of the Islamic finance is firmly rooted in the principles derived from the Holy Qur'an and the Sunnah of the Holy Prophet (p.b.u.h.), the two original sources, which have been kept intact for more than 14 centuries; and when taken together the Qur'an and
Sunnah of the Holy Prophet (p.b.u.h.) or the basis of Shariah law, which govern the Islamic finance, the Shariah law wants to ensure that Muslims invest their funds in a socially responsible manner; and at the centre of Shariah law are concepts of man's vicegerency and trusteeship, concept of Amanah (fiduciary trust) and Adl (fairness). Addressing the Bench he said that this indigenous and equitable form of finance has gained increasing relevance in the last two decades in its home market ‑ the OIC world; that Islamic finance is an emerging product in emerging market, which is gradually evolving along with the market in which it operates. He deliberated on the value creation potential of
Islamic finance, the value paradigm of Islamic finance was outlined in the
Shariah code which talks about the moral transparency, individual responsibility corporate governance, reliance on market mechanism, a commitment to economic and social justice, a partnership of capital and enterprise, a care for environment as some of the core values. He gave the Bench a brief historical overview of the evolution of Islamic finance, stating that the first modern experiment with Islamic banking was undertaken in Egypt in early 1960s, the pioneering in Egypt took the form of savings banks based on the principle of profit sharing in the town of Mit Ghamar; and it was not until the mid 1970s that the industry gained its initial momentum which fact was evidenced by the launching/establishment of Islamic Development Bank in 1975 by the Organization of the Islamic Countries and Pakistan has played an important role in the creation thereof as a founder member. In fact, according to him, Pakistan's finance Minister chairs the Board of Governors of the Islamic Development Bank and the Bank is primarily inter‑Governmental bank which primarily provides fund and infrastructure and developmental project., in member countries. The launching of Islamic Development Bank led to the creation of
Islamic financial institutions in the Gulf cooperation council countries which include Dubai Islamic Bank, 1976, Kuwait Finance House. 1977, Faysal Islamic
Bank in Egypt and Bahrain Islamic Bank in 1979. h was pointed out that in Far
East. Malaysia, the Muslims Pilgrims Saving Cooperation was set up m 1963 which later became the well known Tabong Haji 1969 which in turn led to the creation of Bank Islam Malaysia Bhd in 1982. Since then a number of Islamic financial institutions have emerged in Muslim countries such as Saudi Arabia, UAE, Qatar, Turkey, Pakistan, Indonesia, and Brunei which institutions have taken the form of commercial banks, investment banks, investment companies, Takaful companies
(Insurance). Amongst the major Islamic financial institutions there are Al-?Rajehi, Kuwait Finance House, DMI Group, AI Barakah, Abu Dhabi Islamic Bank, Dubai
Islamic Bank etc. Summing up the history and evolution of Islamic Finance, he informed the Bench that the industry today stands at 90 billion dollars and is growing at 15 per cent. per annum; that the biggest growths are taking place in countries where there are large vibrant middle classes. Taking Kuwait and Saudi
Arabia as a case in point, he stated that Kuwait today has an estimated share of around 40 to 45 per cent. while in Saudi Arabia, admittedly a larger market, the share of Islamic finance was around 20 per cent. According to him most of new institutions being created today are predominantly focused on investment banking; that during the 1990s Islamic financial institutions have become increasingly innovative as more complex instruments and structures have been developed to meet the demand of modern day business; that the use of instruments such as Istesnaa', Ijarah, Bai Salam, are becoming more widespread and we are witnessing tenure, starching as Islamic financial institutions moved towards cash flow based project finance with average life extending seven years and Islamic trenches being created in big ticket deal such as the Equate project in Kuwait and a number of infrastructure project in Turkey. These activities have already landed the Islamic financial institutions in the league tables of
Euro money as arrangers and providers of finance. He added that, there has been a tremendous improvement in the documentation capabilities of Islamic project finance issues being addressed much more clearly; that equity has also opened up as an asset class and they are 'fortifying the portfolios of Islamic financial institutions while we are seeing the promise of private equity being fulfilled through international Musharakas. He emphasized that the trend of
Islamic finance is broadening owner base, creating more stake holders and therefore bringing the hope of stability to Muslim countries He went on to talk about the manner in which the Islamic finance as an industry was evolving alongwith the framework in the countries in which it operate He also emphasized the importance of the supporting Macro economic and legal framework. In order to take Islamic finance forward it was important that comprehensive reforms are brought about in the monetary, fiscal?
and judicial framework of Muslim countries and that the importance of establishing ofmissing links' such Islamic common market and Islamic Dinar.
He referred to the Islamic Drnar to state that today it exists only as a translation currency linked to the SDRs.
Mr. Siddiqul Farooq, Chairman House Building Finance Corporation (HBFC) appeared to state that the society is not well settled to adopt the Islamic Banking system at this juncture, the implementation of which would only create negative impression about Islam than bringing positive results; that all segments of the society and institutions, including the Courts, politicians, religious scholars and bureaucracy have to play their role to establish a true Islamic society in Pakistan; that till now we could not even create a proper ,lunar calendar due to which we celebrate three Eids every year. According to him loan under the Modaraba could trot be effective at this stage where society has lost most of the Islamic moral values and every person who would get loan under Modaraba would never admit about the profit and would always come with a loss. He suggested to adopt the Islamic values in letter and spirit but for the time being also keep in view the exceptions which Islam had allowed in certain circumstances. He referred to the famine during Hazrat Umar Farooq (r.a.)'s time where the punishment for theft had been suspended. He argued that Pakistan was facing an exceptional situation in the shape of inflation and the HBFC has reduced the interest rate almost by two per cent. on the loans it extended as the inflation rate fell and would keep doing the same gradually if inflation rate further declines. He submitted the documents before the Court relating to amendments effected in the laws of the corporation in the light of the HBFC cases in Courts and profits earned by it before 1979 and from 1979 to 1987, 1988‑89 and thereafter. The documents produced also included details of the credit liras payable to State Bank, profit paid to State Bank and balance sheet of the Corporation besides relevant record from 1979 to December 31, 1997. He implored that harvesting was not possible without proper cultivation of land as seeds sown in water cannot yield, legislation without a solid base would bear no fruit rather it would be counter?productive. He pleaded that Holy Prophet (p.b.u.h.) first raised a team of his companions and enforced Islamic laws after spade work for acceptability of Islamic system in the society. The other submissions made by him with, respect to the specific provisions of the House Building Finance Act, 1952, will be dealt with while dealing with Shariat Appeals No.24 of 1992 to 35 of 1992 under the aforesaid Act of 1952.
Syed Riazul Hassan Gilani, representing the Government argued that Riba‑al‑Fazal was covered by the Muslim Personal Law and therefore, Article 203 of the Constitution has excluded the jurisdiction of the Shariat Court. He stated that the term "Islamic Banking" was misnomer as bank had no religion; that in spite of all sympathies with the sentiment behind Islamic Banking, the term Islamic Banking was a misnomer; that Bank is an instrument which can neither be Muslim nor non‑Muslim. Neither all the transactions or modern banking are un‑Islamic nor all the transactions of Islamic banks were purely Islamic. He categorised the Riba into categories as: Riba al Jahilia (pre‑Islamic system of usury) which he said was extremely oppressive; Riba al Qur'an, the compound interest‑based system which was prohibited by the Holy Qur'an; Riba Al Nasiya (profit motivated lending) and Riba al‑Fadl (soft‑interest loans). He argued that the system of Riba al Jahilia and Riba al Nasiya are not relevant in the present case and he would confine himself to Riba al Qur'an and Riba al‑Fadl in his arguments. It was asserted that definition of Riba al Qur'an was definite and undisputed among the Muslim jurists and Muslim sects and it should not remain part of our banking and legal system even for a moment as the. prohibition of Riba al Qur'an is applicable to the Muslims and non‑Muslims of an Islamic State. He stated that Riba al‑Fadl was Makrooh (reprehensible) but not Haram (prohibited) and that some other kinds of Riba like "Najsh" are also Makrooh. It was introduced by Shariah so that the doors of Riba al Qur'an be closed. It is applicable to Muslim citizens of an Islamic State and not to non‑Muslim citizens. He was of the view that if Riba al‑Fadl was prohibited at the State level, it would allow the non‑Muslims to monopolise the banking system of the country. Riba al‑Fadl, according to him, did not strike down the established practice of the society and required the Government to regulate it in public interest. It was argued that Islamic jurisprudence provided for punishment of defaulters and if he could be jailed for breaking his promises why he could not be fined; that a defaulter with bona fide reasons could expect a lenient treatment under Injunctions of Riba al Qur'an; that Indekation in public interest did not fall under the mischief of Riba and he had precedents to show that it was not repugnant to Islamic Injunctions; that overall rationale and objective of prohibition of Riba was to eliminate practice of loans and money‑lending from the Islamic society as far as possible; that money lending with or without pre‑determined profits fell under the category of Riba al‑Fadl. It was contended that Riba was not only applicable on loans but also purchases; that there was similarity in the prohibition of alcohol and Riba as use of alcohol in the society was prohibited gradually and same was the case of Riba. He produced a chart of Qur'anic verses showing a comparison of prohibition of Riba and ban on alcohol. It was stated that it was wrongly attributed to Hazrat Umer Farooq (r.a.) that he had said that verses banning Riba were the last and the Holy Prophet (p.b.u.h.) could not explain it due to early death. It was urged that at least two years before the death of Holy Prophet (p.b.u.h.) the verses banning Riba had been revealed and Riba had been enforced in 8 Hijra and the Holy Prophet (p.b.u.h.) died in 10 Hijra. It was further urged that Holy Prophet (p.b.u.h.) had declared "Muzarbat" as one kind of Riba, and recommending some body for some post with the intent to get something for the recommendation was another kind of Riba. Syed Riazul Hassan Gilani further contended that Holy Prophet (p.b.u.h.) had established loan free society with the idea that debt leads to servitude; that the fate of those countries which took loans for development is before us; that Riba al Qur'an (compound interest‑based system) was Haram and should not be kept for a moment in Islamic State; that the definition of both forms of Riba al Qur'an and Riba al‑Fadl have separate mechanism of enforcement; that any transaction which had an element of "Zulm" was contrary to the injunctions of Islam; that saying of the Holy Prophet (p.b.u.h.) was no less than Qur'an as the matters of Shariat were equally binding on us as of Qur'an; that Riba al Jahilia (pre‑Islamic system of usury) was started at the time of default of the loan and if lender and the lendee agreed on a time frame for the payment of loan and if the deadline for the repayment was not met, the lender would fix Riba. According to him when the Riba al Qur'an was enforced, the Riba al Jahilia would automatically be eliminated and the same remained enforced in all the Muslim States. Riba al Qur'an remains abolished by the State decree of the Holy Prophet (p.b.u.h.) and it remained abolished throughout the Muslim history till the time of Aurangzeb Alamgir, the last powerful Mughal Emperor and when the sub‑continent was subjugated by the Britain, it allowed advancement of loans on the basis of interest. The permission led to perpetuation of Zulm and people were under virtual slavery of the Hindu Banyias. According to him loan of Banyia fell both in the category of Riba al Qur'an and Riba al‑Fadl. He asserted that the propositions of law derived from the text relating to Riba al‑Fadl are from the cry beginning disputed amongst the Muslim jurists and the Muslim sects because the Hole Prophet (p.b.u.h.), to save the Ummah from hardship, did not enforce Riba al‑Fadl in the form of a definite ruling and only the mode of exchange of six commodities was illustrated; that the enforcement of prohibition of Riba al‑Fadl is not the obligation of the State as its implementation is responsibility of individual Muslim and this was not enforced in the form of a State decree/a proposition of law by the Holy Prophet, Khulfai Rashedeen and the Muslim Rulers in the Muslim History; that Riba al‑Fadl does not strike down "Mash‑al‑Tarajeeh" i.e. the established practice of the society; that only Hajat (facility/need) rather than Zaroorat (necessity) is entitled to exception in the domain of Riba al‑Fadl; that the State may in the public interest regulate Riba al‑Fadl; that the saying "Qule Qarze jer manfaatu fahowa Riba? is not a Hadith but a principle derived from the provision of Riba al‑Fadl; that the predetermined profit on loan was considered Makrooh by Imam Abu Hanifah and other great jurists as it falls under Riba al‑Fadl; that the penalty or fine imposed on wilful defaulter is not Riba and a defaulter can also be put behind the bar till he pays the debt while only a bona fide defaulter is/should be entitled to lenient treatment contemplated in Riba al Qur'an; that the over all rationale and objective of prohibition of Riba is to eliminate loan in the Muslim society as far as possible and a loan with or without predetermined profit falls under Riba al?-Fadl while bona fide need (Hajat) is exception to the Rule; that Riba al‑Fadl is covered by the term Muslim Personal Law used in Article 203 of the Constitution ‑ thus subject of Riba al‑Fadl is not within the jurisdiction of Federal Shariat Court; that in spite of all the sympathies with the sentiments behind Islamic Banking, the term. Islamic Banking is a misnomer, Bank is an instrument which can neither be Muslim nor non‑Muslim, neither all transactions of modern Banking are un‑Islamic nor all the transactions of Islamic Banking are Islamic and all the attention of Islamic Banking is diverted towards Riba al‑Fadl, whereas due attention is not paid to Riba al Qur'an. Arguing his case, it was asserted by Syed Riazul Hassan Gilani that in Islam the real meaning of "Qarz" was lending money to someone without any interest. He also quoted a Hadith of the Holy Prophet (p.h.u.h.) in which the Holy Prophet (p.b.u.h.) had stated that he saw in the heavens written that who lends Qarz receives 18 times more "Sawab" as compared to the Sawab blessed on one who pay "Sadqa" and gets 10 times of it only. He also told the Court the views of Ulema of the sub‑continent about the banking institutions established by the British. One requirement for getting correct "Fatwa" from the Ulema should be to ask questions by the persons seeking Fatwa, in clear terms since Ulema were not experts of sciences. He added that there were three kinds of Ijtehad including Tehrir‑e‑Munaja, Tanqia‑e‑Munaqa and Tehrik‑e‑Munaja. He referred to the Fatwa of Hazrat Ahmad Raza Barelvi about the banking system which he had given to a specific question by a man about the profit being offered to him by the bank on his deposits. The Maulana in response said though interest was Haram but he could receive the enhanced money believing that he was not getting interest. This Fatwa was given in the background, Gillani explained, when banks were not national institutions rather British institutions and the Maulana had no sympathy with the banks. He said except Sir‑ Syed Ahmed Khan, no scholar of the sub‑continent gave any importance to the British institutions. Sir Syed was of the view that if the Muslims distanced themselves from the banking system, it would only benefit the Hindus.
At this stage Syed Riaz ul Hassan Gilani, learned counsel for the federal Government sought adjournment of the case after summer vacation since he could not close his arguments and he had only covered one‑fourth of it, besides he had to go to Lahore to look after his ailing father and was also planning to proceed on Umra. The Court rejected his plea reminding the assurance he gave to the Court to conclude the arguments as well as the professional duty that he owes to the Court to appear and assist the Court irrespective of amount of fee that he claims from the Government. The hearing was, however, adjourned to the following week. Syed Riazul Hassan Gillani did not appear to conclude his arguments despite specific order of the Court. The Court after waiting for an hour adjourned the matter to the ensuing day in order to give him another chance to appear and complete his submissions. The Federation's counsel, however, did not turn up on such day as well. Attorney‑General, Chaudhry Muhammad Farooq who was also asked to appear on the next day did not appear. Chaudhry Akhtar Ali, Federation's Advocate‑on‑Record, however, made a statement before the Court that the Attorney‑General had nothing to say in the case. The Advocate‑on‑Record for the Federation said that Mr.Gillani was not available and the Attorney‑General had no submission to make in the case. The Court, in the circumstances, was constrained to conclude the hearing. It was observed that the Federation's counsel is at liberty to file his submissions in writing within fifteen days. Learned Additional Advocate?-General Punjab, Rana Muhammad Arif, who was present in the. Court room stated that he intended to argue the matter after the completion of arguments by the counsel of the Federation and when the Court asked him to start his arguments, he showed his inability to start his arguments immediately stating that he was of the view that the counsel for the Federation would get some time for the completion of his arguments. In the circumstances, the learned Additional Advocates‑General of the N.‑W.F.P. and Punjab were directed to submit their arguments, if they wanted to, in writing. The representative of the Government of N.‑W.F.P. later submitted a brief note reiterating the pleas noted above.
Before proceeding to examine the aforenoted submission on crucial issues of definition of Riba, the concepts, connotation and scope thereof, it is appropriate to deal with the question of scope of jurisdiction of the Federal Shariat Court and the Shariat Appellate Bench.
The question of scope of jurisdiction of the Federal Shariat Court and the Shariat Appellate Bench of this Court, was raised by some jurisconsults and the scholars who appeared before us. This question was raised mainly in view of the representation of the Government made in the application for withdrawal of the appeal from this Court and to seek parameters and guidelines from the Federal Shariat Court as to the modalities of enforcing and implementing its judgment on Riba. The Government needed such guidelines within which the Government wanted to move the necessary legislation for the compliance of ifs constitutional duty and obligation to enforce a truly Islamic economic system. The Federal Government in. the said application had also contended that some serious issues of utmost importance have come up which have a close and intimate bearing on Pakistan's obligations both to foreign lenders as well as in relation to the functioning of the banking system within the country including lending for the payment of foreign debts, inflation, indexation etc. are involved and that the Government seeks guidelines of the Court (Federal Shariat Court) in the shape of laying down guidelines on the basis of which the Government can comply with its solemn commitments within the framework of Islamic Injunctions. These specific parameters and guidelines,, it was urged, were to be sought so as to enable banking and other related laws to be recast in such a manner that they conform strictly to the stipulations of Islam.
Prof. Khurshid Ahmad, Maulana Abdul Sattar Niazi and Maulana Gauhar Rehman, the religious scholars as well as Mr. Muhammad Ismail Qureshi, Advocate, argued that neither the Federal Shariat Court nor the Shariat Appellate Bench of the Supreme Court has jurisdiction or power to provide guidelines or the parameters in compliance of which the Government is to provide the legal framework of Islamic Injunctions by enacting appropriate laws, nor economic financial or banking policies or the system is to be charted out by the Court. According to them the Federal Shariat Court and the Shariat Appellate Bench of the Supreme Court, in view of the provisions contained in Chapter 3‑A of the Constitution and more particularly under Article 203‑D of the Constitution are empowered only to examine and decide one question i.e. whether or not any law or provision of law is repugnant to the Injunctions of Islam as laid down in the Holy Qur'an and Sunnah of the Holy Prophet (peace be upon him). According to them it is only vires of any law or the provisions of law on the touchstone of Injunctions of Islam as to their repugnancy or otherwise which is to be examined and decided by the Court i.e. the Federal Shariat Court and the Shariat Appellate Bench of the Supreme Court. Neither the framing of any law nor the economic or financial policies or the banking system itself can be examined by the Federal Shariat Court as these are concerns of the other organs of the State under the relevant provisions of the Constitution and the law. It is unfortunate that these contentions so emphatically urged by the religious scholars were not at all adverted to by the learned counsel for the Federation. Learned Attorney‑General also, despite being conscious of the questions raised in the application moved by the Federation and the view‑point of the religious scholars on this question, did not enter appearance to render assistance to the Bench on the important Constitutional and legal questions in his capacity of highest law, officer of the country, what to say of presenting and elaborating the point of view of the Federal Government. We have, therefore, surveyed the provisions of the Constitution and the relevant legal provisions on our own. Article 203?D of the Constitution which provides for the powers, jurisdiction and functions of the Federal Shariat Court constituted in pursuance of Article 203‑C of the Constitution reads as under:‑‑‑--
"203D. Powers, jurisdiction and functions of the Court‑‑ (1) The Court may, [either of its own motion or] on the petition of a citizen of Pakistan or the Federal Government or a Provincial Government, examine and decide the question whether or not any law or provision of law is repugnant to the Injunctions of Islam, as laid down in the Holy Qur'an and the Sunnah of the Holy Prophet, hereinafter referred to as the Injunctions of Islam.
(IA) Where the Court takes up the examination of any law or provision of law under clause (1) and such law or provision of law appears to it to he repugnant to the Injunctions of Islam, the Court shall cause to be given to the Federal Government in the case of a law, with respect to a matter in the Federal Legislative List or the Concurrent Legislative List, or to the Provincial Government in the case of a law with respect to a matter not enumerated in the either of those Lists, a notice specifying the particular provisions that appear to it to be so repugnant, and afford to such Government adequate opportunity to have it point of view placed before the Court.
(2) If the Court decides that any law or provision of law is repugnant to the Injunctions of Islam, it shall set out in its decision‑‑
(a) the reasons for its holding that opinion; and
(b) the extent to which such law or provision .is so repugnant: and specify the day on which the decision shall take effect:
Provided that no such decision shall be deemed to take effect before the expiration of the period within which an appeal therefrom may be preferred to the Supreme Court or, where an appeal has been so preferred, before the disposal of such appeal.
(3) If any law or provision of law is held by the Court to be repugnant to the Injunctions of Islam,‑‑
(a) the President in the case of a law with respect to a matter in the Federal Legislative List or the Concurrent Legislative List, or the' Governor in the case of a law with respect to a matter not enumerated in either of those Lists, shall take steps to amend the law so as to bring such law or provision into conformity with the Injunctions of Islam; and '
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(b) such law or provision shall, to the extent to which it is held to he so repugnant, cease to have effect on the day on which the decision of the Court takes effect."
The revisional and other jurisdiction of the Federal Shariat Court is contained in Article 203‑DD while Article 203‑E details the powers and the procedure of the Court. The next Article i.e. Article 203‑F provides for appeal to the Shariat Appellate Bench of the Supreme Court against the final decision of the Court rendered in the proceedings under Article 203‑D of the Constitution. At this juncture it will be appropriate to reproduce the definition of the term "law" given in clause (c) of Article 203‑B in Chapter 3 of the Constitution which reads:‑‑
"law" includes any custom or usage having the force of law but does not include the Constitution, Muslim Personal Law, any law relating to the procedure of any Court or Tribunal or, until the expiration of ten years from the commencement of this Chapter, any fiscal law or any law relating to the levy and collection of taxes and fees or banking or insurance practice and procedure.
It is pertinent to note that the period of ten years of moratorium has expired and as such the vires of any fiscal law or any law relating to the levy and collection of taxes or fees and banking or insurance practice and procedure can now be tested on the touchstone of Islamic Injunctions. It is also pertinent to note that the provisions of the Constitution, Muslim Personal Law and any law relating to the procedure of any Court or Tribunal are still outside the purview or jurisdiction of the Court i.e. the Federal Shariat Court and the Shariat Appellate Bench of the Supreme Court. The jurisdiction is thus limited to the examination of the question whether any law or provision of law is or is not repugnant to the Injunctions of Islam as laid down in the Holy Qur'an and Sunnah of the Holy Prophet and the term "law" also includes any custom or usage having the force of law or any law relating to banking or insurance practice and procedure. The authors of Chapter 3‑A consciously included within the definition of term? "law" for the purposes of Chapter 3‑A, "any custom or usage having the force of law" as the Supreme Court in its judgment in Federation of Pakistan through the Secretary, Ministry of Finance, Government of Pakistan. Islamabad etc. v. United Sugar Mills Limited, Karachi (PLD 1977 SC 397) had held that "the term "law" as used in Article 4 has also been used in Article 8 of the Constitution, in contradistinction with any "custom or usage having the force of law" and must therefore, be given the same limited connotation in Article 4 as well." The Shariat Appellate Bench of the Supreme Court in the case of Wasi Ahmed Rizvi v. Federation of Pakistan (PLD 1982 SC 20) commenting on the term "law" appearing in Article 203‑B observed:‑‑
"13. Coming back to Article 203‑B which confers jurisdiction, which defines the limits thereof and which prescribed exclusions thereto, we find that it provides an inclusive definition of law. On the force of that definition itself any usage having the force of law shall qualify as law. Such a usage may relate to the nation or group as a whole or may relate to practise and procedure of the Court. The former has been included in the definition of law but the latter has been expressly excluded by providing that law includes any custom or usage having the force of law but does not include 'any law relating to the procedure of any Court or tribunal'. Law here does not mean only the enacted law but includes usage having the force of law. Such usage or law may relate to procedure of Court or to matters not expressly excluded from the jurisdiction of the Court. If usage or law does not relate to matters excluded from jurisdiction, a petition attacking it would be competent. On the other hand, if it concerns any of the matters excluded then it would be incompetent."
But the question is whether the Federal Shariat Court or the Shariat Appellate Bench of the Supreme Court can be called upon to lay down parameters and guidelines of financial policies or the banking system‑and the legal framework needed for complying with the requirements of Shariah. The mandate of the Constitution as is apparent from the Objectives Resolution under Article 2‑A it that the Muslims shall be enabled to order their lives in the individual and collective spheres in accordance with the teachings and requirements of Islam as set out in the Holy Qur'an and Sunnah; and that adequate provision shall be made for the minorities to profess and practise their religions and develop their cultures; and also that fundamental rights including equality of status of opportunity and before law, social economic and political justice, and freedom of thought, expression, belief, faith, worship and association, subject to law and public ' morality, shall be guaranteed.
The framing of laws is the prerogative of the Parliament or the Provincial Assemblies according to their respective spheres allotted to them under the Constitution. A reference to Article 227 of the Constitution is relevant as it prop‑ides that all existing laws shall be brought in conformity with the injunctions of Islam as laid down in the Holy Qur'an and Sunnah, and that no law shall be enacted which is repugnant to such Injunctions. Clause (2) of this very Article provides that effect shall be given to the provisions of clause (1) only in the manner provided in Part IX of the Constitution. This has a reference to the next Article 228 which provides for composition of Council of Islamic Ideology to which a reference may be made by the Parliament, the President or the Governor of a Province on a question whether a proposed law is or is not repugnant to the injunctions of Islam. On receipt of such a question so referred under Article 229 the Council has to inform within 15 days of the receipt of reference, the period within which the Council expects to be able to furnish the reply/advice. Article 230 further provides that if the Council advises that the law is repugnant to the Injunctions of Islam, the Parliament, the Provincial Assembly, the President or the Governor, as the case may be, shall reconsider the law so made. This is how the law which is to be framed or enacted can he made to conform to the In junctions of Islam and the mandate of Article 227 that no law shall be enacted which is repugnant to such injunctions is to be complied with. If any enacted law is considered by anyone to be repugnant to the Injunctions of Islam, the course to be adopted, as provided by the Constitution, is to challenge the said law before the Federal Shariat Court under Article 203‑D of the Constitution. This power can also be exercised suo moat by the Federal Shariat Court.
The manner of framing of laws by the Parliament or the Provincial Assembly as to who is to introduce a law in the shape of the bill in the Parliament or the Provincial Assembly is contained in the Constitution and need not be dilated upon here. The framing of the economic and financial policies including banking is prerogative of the Government which is composed of the majority party in the Parliament or in the Provincial Assemblies. The parameters, the limits and the scope of these policies have been provided in the Constitution itself and the laws framed under the Constitution. Some of the Constitutional provisions having important bearing on the fiscal policies may now be noticed.
Article 73 of the Constitution provides that a Bill or amendment shall be deemed to he a Money Bill if it contains provisions dealing with all or any of the following matters:‑‑---
(a) the imposition, abolition, remission; alteration or regulation of any tax;
(b) the borrowing of money, or the giving of any guarantee, by the federal Government, or the amendment of the law relating to the financial obligations of that Government;
(c) the custody of the Federal Consolidated Fund, the payment of moneys into, or the issue of moneys from, that Fund;
(d) the imposition of a charge upon the Federal Consolidated Fund, or the abolition or alteration of any such charge;
(e) the receipt of moneys on account of the Public Account of the Federation, the custody or issue of such moneys;
(f) the audit of the accounts of the Federal Government for a Provincial Government; and
(g) any matter incidental to any of the matters specified in the preceding paragraphs.
A Money Bill is to originate in the National Assembly and if passed is to be presented, without being transmitted to the Senate, to the President for assent. Article 74 then provides as under:‑‑---
"A Money Bill, or a Bill or amendment which if enacted and brought into operation would involve expenditure from the Federal Consolidated Fund or withdrawal from the Public Account of the Federation or affect the coinage or currency of Pakistan or the constitution or functions of the State Bank of Pakistan shall not be introduced or moved in Majlis‑e‑Shobra (Parliament) except by or with the consent of the Federal Government. ‑‑
The other provisions which provide for financial procedure and also borrowing powers of the Government may now he noticed. These are reproduced hereunder:‑‑‑
"78. Federal Consolidated Fund and Public Account.‑‑‑(1) All revenues received by‑ the Federal Government. all loans raised by that Government, and all moneys received by it in repayment of any loan, shall form part of a consolidated fund. to be known as the Federal Consolidated Fund.
(2) All other moneys‑‑
(a) received by or on behalf of the Federal Government; or
(b) received by or deposited with the Supreme Court or any other Court established under the authority of the Federation, shall be credited to the Public Account of the Federation.
Custody etc. of Federal Consolidated Fund and Public Account.---The custody of the Federal Consolidated Fund, the payment of moneys into that Fund, the withdrawal of moneys therefrom, the custody of other moneys received by or on behalf of the Federal Government their payment into, and withdrawal from, the Public Account of the Federation, and all matters connected with or ancillary to the matters aforesaid shall be regulated by Act of Majlis‑e‑Shoora (Parliament) or, until provision in that behalf is so made, by rules made by the President.
Annual Budget‑‑‑‑(1) The Federal Government shall, in respect of every, financial year, cause to be laid before the National Assembly a statement of the estimated receipts and expenditure of the Federal Government for that year, in this Part referred to as the Annual Budget Statement.
(2) The Annual Budget Statement shall show separately ‑‑
(a) the sums required to meet expenditure described by the Constitution as expenditure charged upon the Federal Consolidated Fund; and
(b) the sums required to meet other expenditure proposed to be made from the Federal Consolidated Fund; and shall distinguish expenditure on revenue account from other expenditures.
(a) the remuneration payable to the President and other expenditure relating to his office and the remuneration payable to‑‑
(i) the Judges of the Supreme Court;
(ii) the Chief Election Commissioner;
(iii) the Chairman and the Deputy Chairman;
(iv) the Speaker and the Deputy Speaker of the National Assembly;
(v) the Auditor‑General;
(b) the administrative expenses, including the remuneration payable to officers and servants, of the Supreme Court, the department of the Auditor‑General and the Office of the Chief Election Commissioner and the Secretariats of the Senate and the National Assembly;
(c) all debt charges for which the Federal Government is liable, including interest, sinking fund charges, the repayment or amortisation of capital, and other expenditure in connection with the raising of loans, and the service and‑ redemption of debt on the security of the Federal Consolidated Fund;
(d) any sums required to satisfy any judgment, decree or award against Pakistan by any Court or Tribunal; and
(e) any other sums declared by the Constitution or by Act of Majlis‑e?-Shoora (Parliament) to be so charged.
(2) So much of the Annual Budget Statement as relates to other expenditure shall be submitted to the National Assembly in the form of demand for grants, and the Assembly shall have power to assent to, or to refuse to assent to, any demand, or to assent to any demand subject to a reduction of the amount specified therein:
Provided that, for a period of ten years from the commencing day or the holding of the second general election to the National Assembly, whichever occurs later, a demand shall be deemed to have been assented to without any reduction of the amount specified therein, unless, by the votes of a majority of the total membership of the Assembly, it is refused or assented to subject to a reduction of the amount specified therein.
(3) No demand for a grant shall be made except on the recommendation of the Federal Government."
A study of these Articles shows that the Federal Government has the power to frame the financial, economic and fiscal policies of the State and also to provide necessary legal framework to execute such policies. It is the Federal Government which has the authority under the Constitution to operate and issue guarantees on the security of the Federal Consolidated Fund under such limits as may be fixed by an Act of the Parliament. However, no such law framed by the Parliament was referred to us. In the absence of such a law, the Government exercises unrestricted powers to borrow against the security of the Federal Consolidated Fund as no law has yet been framed to regulate the custody of Federal Consolidated Fund or the Public Account of the Federation. Though variety of rules such as Treasury Rules exist but in the absence of specific laws and rules pertaining to borrowing, it is practically and ultimately the Rules of Business which are resorted to regulate the business of the Federal Government. Rules of Business [Schedule II, specified in Rule 3(3)] indicate at Entry No.13 `Finance Division' and the functions assigned to the said Division. In sub?entries 6 and 7 thereof, following items have been mentioned:‑‑---
Public debt of the Federation both internal and external; borrowing money on the security of the Federal Consolidated Fund;
Loans and advances by the Federal Government.
It follows from these provisions of the Rules of Business that the lending and borrowing operations of the Federation are performed by the Ministry of Finance within the framework provided in the Rules of Business.
No specific guidelines appear to have been provided to regulate and streamline such functions. It may, therefore, be inferred that the Secretary Finance or at best the Minister for Finance are free to make decisions on these subjects though they may consult the Prime Minister if the matter is considered, in the discretion of the Secretary Finance or the Minister for Finance, to be an important policy matter. Rule 16 which specifies the cases required to be brought before the Cabinet does not contain borrowing proposals and as such even the Cabinet is not required to be taken into confidence. It will, therefore, be seen that neither the borrowings are restricted for specific uses nor the expediency of the situation necessitating borrowings has been spelled out. This situation of wide flexibility confers on the Finance Division unique and unlimited powers to borrow without at all being bothered about the productivity of the uses to which borrowed resources are applied or even without there being any limitation to the extent to which the nation is to be burdened with borrowings.
As regards the revenues and loans credited to Federal Consolidated Fund and to Public Account, expenditures are incurred without regard to the sources of funds. It appears that no accounting is done for identifying the liabilities created by certain expenditures as revenues are mixed up with proceeds of loans and both are treated at par. This situation prevails as regards the borrowings both from foreign lenders as well as domestic lenders, as no distinction is made whether the borrowing in rupee or in foreign exchange or from local and foreign markets. It is only the Government in power which is to decide freely the mix between the foreign and local borrowings or in rupee or in foreign exchange. Under the Federal Legislative List, Entries No. 9 and 10, make the subjects of foreign loans and foreign aid Federal subjects.
At this stage the views of Dr. Waqar Masood Khan, Vice-?President, International Islamic. University with regard to the implications emerging from the legal provisions on the subject may be dealt with. He contended that:‑‑--
"(1) The Federal Government enjoys borrowing powers which are Constitutionally sanctioned and no limits have been placed by any Act of the Parliament on these powers.
(2) The borrowing transactions, are protected by their inclusion within the list of expenditure charged to the Federal Consolidated Fund; according to the interpretation of Dr. Waqar Masood Khan, these transactions include both the principal money as well as the interest.
(3) Charged expenditure enjoys the protection of complete insulation from Parliamentary control or scrutiny. Although such expenditure can be debated but cannot be put to vote, and hence no cut motions can be moved in respect of such expenditure. More importantly, since these are charged expenditure, they take precedence over all other expenditures. Apparently, such obligations will have to be discharged prior to incurring any other expenditure.
(4) Together with the absence of any Act to regulate the custody of the FCF and PA, the Federal Government has complete freedom to manage the finances of the Federation." .
The other important aspects to be noticed, considering overall effect of the judgments rendered by the Federal Shariat Court, it was contended, are:‑‑
(a) That the Federal Shariat Court has examined only the laws enlisted above and not the other laws having bearing on the common finances or containing provisions pertaining to levy or charging of interest. An illustrative list of these laws provided by Dr.Waqar Masood details the enactments as follows:‑‑
(1) Contract Act, 1872 (Act IX of 1872), section 73, illustration (n).
(2) Trusts Act, 1882 (Act II of 1882), sections 20 and 20A.
(3)? Transfer of Property Act, 1882 (Act IV of 1882), sections 58 to 104.
(4) The Land Improvement Loans Act, 1883 (Act XIX of 1883), sections 6, 7 and 10.
(5) The Agricultural Loan Act, 1884 (Act XII of 1884), section 5.
(6) The Local Authorities Loan Act, 1914 (Act IX of 1914), sections 3 and 4.
(7) The Usurious Loans Act, 1918 (Act X of 1918), sections 2 and 3.
(8) The Securities Act, 1920 (Act X of 1920), section 13(2) [many other parts implying that securities bear interest].
(9) The Provident Funds Act, 1925 (Act XIX of 1925), section 2 [many other parts implying that interest is payable].
(10) The Public Debt Act, 1944 (Act XVIII of 1944), section 18 [many other parts implying that interest is payable].
(11) The Foreign Exchange Regulation Act, 1947 (Act VII of 1947), section 13 [many other parts implying that interest is payable].
(12) The National Bank of Pakistan Ordinance, 1949 (Ordinance XIX of 1949), section 25 [many other parts which imply interest‑based business]. , (13) The House Building Finance Corporation Act, 1952 (Act XVIII of 1952), sections 21 and 24 [many other parts implying dealings in interest].
(14) The. Industrial Development Bank of Pakistan Ordinance, 1961 (Ordinance XXXI of 1961), sections 5 and 27 [many other parts implying dealings in interest].
(15) The Investment Corporation of Pakistan Act, 1966 (Ordinance IV of 1966), section 23 [many other parts implying dealings in interest].
(16) The People's Finance Corporation Act, 1972 (Act XXIX of 1972), section 20 [and many other parts implying dealings in interest].
(17) The National Development Finance Corporation Act, 1973 (Act VIII of 1973), section 18 [and many other? parts implying dealings in interest].
(18) The Establishment of the Federal Bank for Cooperatives and Regulation of Cooperative Banking Act, 1977 (Act IX of 1977), section 17 [many other parts implying dealings in interest].
(19) The Income Tax Ordinance, 1979 (Ordinance XXXI of 1979), section 17 and numerous other provisions dealing with interest income.
(20) The Companies Ordinance, 1984 (Ordinance XLVII of 1984). Numerous provisions dealing with debentures and other fixed income securities.
(b) That the treasury rules and other rules regulating Government finances have also not been examined by the Federal Shariat Court. Thus at present Government finances may not be directly and fully hit by the decision of the Federal Shariat Court. These finances may be hit only partially.
(c) That the borrowing powers of the Government emanate directly from the Constitution and the provisions of the Constitution are beyond the scrutiny or examination of the Federal Shariat Court and hence it is to be seen and decided whether the laws authorizing the Government to borrow can be struck down disabling the Government from borrowing on the basis of interest.
It was for these reasons that it was contended that, in view of the above Constitutional provisions, the Government finances seem to be outside the purview of the Federal Shariat Court because it is not competent to examine the provisions of the Constitution, and since borrowing powers are protected under the Constitution together with the transactions carried out in pursuance of such powers the process of prohibition apparently cannot be extended to the Government finances under the existing scheme of judicial review of laws with regard to their consistency with the Injunctions of Islam. Following the above noted line of argument, Dr.Waqar Masood expressed the view that within the existing Constitutional framework the prohibition can effectively be applied to private transactions and not to the Government finances unless of course the Constitution is amended.
We have given serious considerations to the abovenoted aspects and are of the view that as regards the laws which have not yet been scrutinized by the Federal Shariat Court, it will be appropriate to have the said laws/enactments/provisions scrutinized by moving appropriate petitions by the Government itself or by taking suo motu notice by the Federal Shariat Court. As regards implications emerging from the legal provisions on the subject, the Federal Government enjoys borrowing powers under Article 78 of the Constitution. The mandate of Article 79 of the Constitution, however, is that an Act of the Parliament has to regulate‑‑
(a) the custody of the Federal Consolidated Fund;
(b) the payment of moneys into that Fund;
(c) the withdrawal of moneys therefrom;
(d) the custody of other moneys received by or on behalf of the Federal Government;
(e) their payment into, and withdrawal from, the Public Account of the Federation; and
(f) all matters connected with or ancillary to the matters aforesaid.
This mandate has not yet been obeyed and complied with as no enactment has been till date framed and enacted by the Parliament. All the above matters are being dealt with under the Rules made by the President which Rules, as commented in one of the paragraphs above are deficient in many respects and, in any case, cannot be a valid substitute of law framed by the Parliament itself. The Rules existing on the subject were probably made pursuant to section 151 of the Government of India Act, 1935, which section provided that the Rules may be made by the Governor‑General and by the Governor of Province for the purpose of securing all moneys received on account of revenues of the Federation or of the Province and also with regard to the moneys to be paid into the Public Account of the Federation or the Province. After the establishment of Pakistan, the Constitutions of 1956 in Article 62, the Constitution of 1962 in Article 38 and the Constitution of 1973 in Article 79 mandated for the enactment of an Act by the Parliament to regulate the custody of the Federal Consolidated Fund, the payment of and withdrawal of moneys into or therefrom as well as custody of other moneys received by or on behalf of the Federal Government, their payment or withdrawal from the Public Account of the Federation and all matters connected with or ancillary thereto. Reference may also be made to Article 81 of the Constitution of which clause (c) provides that the expenditure charged upon the Federal Consolidated Fund includes all debt charges for which the Federal Government is liable, including interest sinking fund charges, the repayment or amortisation of capital, and other expenditure in connection with the raising of loans, and the service and redemption of debt on the security of the Federal Consolidated Fund. Reference may also be made to Article 166 of the Constitution which provides that the executive authority of the Federation extends to borrowing upon the security of the Federal Consolidated Fund within such limits, if any, as may from time to time be fixed by Act of Majlis‑e‑Shoora (Parliament), and to the giving of guarantees within such limits, if any, as may be so fixed. Similar provisions were contained in the Constitutions of 1962 and 1956 in Articles 139 and 115 respectively. The economists appearing before us showed ignorance as to the existence of any such law as contemplated by these Articles on the statute book. In the absence of any such enactment providing guidelines and fixing the limits up to which the borrowing power can be exercised by the Federation, Dr.Waqar Masood, argued that the charged expenditure enjoys the protection of complete insulation from parliamentary oversight as, on the one hand, no guidelines exist and, on the other, such expenditure can be debated but is not to be put to vote. Moreover, the Federal Government has complete freedom to manage the finances of the Federation and this unrestricted power has plunged the Nation into huge indebtedness and has ruined the economy. It would be seen that for almost fifty years we have not been able to obey the mandate of the Constitution by not enacting appropriate law defining the borrowing powers, the purposes, the use and limit of the exercise of such power. The contracts of billions of dollars burdening the nation through execution of sovereign guarantees are being entered into without information of even the members of the cabinet what to say of obtaining approval of the National Assembly by a member of bureaucracy or advisor appointed by Prime Minister in his sole discretion injudiciously. The contract executed with IPPs provide sufficient basis for providing prudential laws and making approval of such contracts by the National Assembly mandatory. Such a law should be enacted without further loss of time so that prudential measures could be adopted so as to regulate management of Federal Consolidated Fund as well as Provincial Consolidated Funds and Public Accounts and the borrowing powers of the Federation particularly.
The contention that the process of prohibition cannot be extended to Government Finances under the existing scheme of Judicial Review of laws with regard to their consistency with the Injunctions of Islam on account of the fact that the Constitutional provisions cannot be scrutinized on the touchstone of Injunctions of Islam under Article 203‑D of the Constitution merits some consideration. It is on account of exclusion of the Constitution from the definition of the term "law" given in clause (c) of Article 203‑B that this view has been expressed. No doubt, the question of repugnancy or otherwise of the Constitutional provisions on the touchstone of Injunctions of Islam cannot be examined by the Federal Shariat Court and also by the Shariat Appellate Bench of the Supreme Court but the enactment which as and when framed regulating the Federal Consolidated Fund or the Public Accounts as well as defining, prescribing and limiting the borrowing powers are enacted, the said statute, enactment or even the rules shall have to conform to the Injunctions of Islam as contained in the Holy Qur'an and G Sunnah of the Holy Prophet not in view of the provisions contained in Article 203‑B(c) but also of the provision of Article 2‑A and Article 227 of the Constitution. This Constitutional position is well established and in support reference may be made to Hakim Khan and 3 others v. Government of Pakistan through Secretary Interior and others PLD 1992 SC 595) wherein five learned Judges of this Court, inter alia, held that the Court has no power to apply the test of repugnancy by invoking Article 2‑A of the Constitution for striking down Article 45 of the Constitution of the Islamic Republic of Pakistan for the reason that if any Article of the Constitution is in conflict with Article 2A, the appropriate procedure is to have it amended in accordance with the prescribed provision for the purpose. However, it does not absolve the Courts of their duty to give effect to the provisions of Article 2A as it has been made substantive part of the Constitution. A Constitution is an organic whole. All its Articles have to be interpreted in a manner that its soul or spirit is given effect to by harmonising various provisions. Again in The State v. Syed Qaim Ali Shah (1992 SCMR 2192) it was observed that the Courts while construing the provisions of statute should make efforts that the interpretation of the relevant provision of the statute should be in consonance with Article 2A of the Constitution and the grund norms of human rights.
This Court in the case of Zaheeruddin and others v. The State and others (1993 SCMR 1718) declared that effect of adoption of Objectives Resolution as Article 2A in the Constitution by the chosen representatives of the people as the operative part of the Constitution, is the acceptance of sovereignty of Allah to be binding on them who vowed. that they will exercise only the delegated powers within the limits fixed by Allah. Such adoption also enhanced the power of judicial review of the superior Courts. It was further observed that "the Constitution has adopted the Injunctions of Islam as contained in Qur'an and Sunnah of the Holy Prophet (p.b.u.h.) as the real and the effective law. In that view of the matter, the Injunctions of Islam as contained in Qur'an and Sunnah of the Holy Prophet (p.b.u.h.) are now the positive law. Article 2A, made effective and operative the sovereignty of Almighty Allah and it is because of that Article that the legal provisions and principles of law, as embodied in the Objectives Resolution: have become effective and operative. Therefore, every man‑made law must now conform to the Injunctions of Islam as contained in Qur'an and Sunnah of the Holy Prophet (p.b.u.h.). Therefore, even the Fundamental Rights as given in the Constitution must not violate the norms of Islam". Again this Court in the case of Mushtaq Ahmad Mohal and others v. The Honourable Lahore High Court, Lahore and others (1997 SCMR 1043) held the appointments to various posts by the Federal Government, Provincial Governments, statutory bodies and other Authorities, either initial, ad hoc or regular, without inviting applications from the public through the press to be violative of Article 18 read with Article 2A of the Constitution of Pakistan. Not only the actions but also the laws to be framed as such are to conform to the grund norm established by the incorporation of the I Objectives Resolution as substantive part of the Constitution with the addition of Article 2A in the Constitution of the Islamic Republic of Pakistan, 1973.
Reference may be made to the case of Dr.Mahmood‑ur‑Rahman Faisal v. Government of Pakistan through Secretary, Ministry of Justice, Law and Parliamentary Affairs, Islamabad .(PLD 1994 SC 607) wherein Shariat Appellate Bench of the Supreme Court observed that the provisions of the Constitution conferring jurisdiction on the Federal Shariat Court to examine whether or not any law or provision of the law is opposed to the Injunctions of Islam, are to be interpreted in a manner which would give full effect to the process of Islamization of laws and such interpretation will be more harmonious with the spirit and letter of the Constitution.
The net result of the above discussion is that every law to be framed by the Parliament has to conform to the Injunctions of Islam as contained in Holy Qur'an and Sunnah of the Holy Prophet (peace be upon him) and if any such law is found to be repugnant to the Injunctions of Islam, the Federal Shariat Court as well as the Shariat Appellate Bench of the Supreme Court has the power to scrutinize the said law on the touchstone of Islamic injunctions and make the necessary declaration as is contemplated in Article 203‑D of the Constitution and the Federal Government or the Provincial Governments, as the case may be, shall have to amend the law suitably as required in the judgment.
The definition of 'Riba' as finally determined by this Court will provide touchstone for evaluating as to whether a provision of law conforms to the Injunctions of Islam or not and any such provision of law as finally declared to be not conforming to the injunctions of Islam shall have to be amended suitably. The position of the past and closed transactions and the liabilities already incurred under the existing provisions of law is, however, different and shall be dealt with at appropriate stage while dealing with the said question in this judgment.
The stage is now set to examine the question of definition of Riba, the concept of Riba, as found in Qur'an and expounded by the Prophet of Islam, practised by the Righteous Caliphs and understood and explained by the Fuqaha. The criticism of the opponents of Islam, the pleas urged and the apprehension expressed by certain quarters will also be examined here?under.
The question of redefining Riba in the context of modern international economic and monetary system has been raised time and again, during the past few decades. It was raised before the learned Federal Shariat Court and has also been raised before us not only in the appeal submitted on behalf of the Federation but also on behalf of some other appellants. It has been asserted that since the present monetary system has become much more advanced, complex and developed as compared to what is termed by some as the rudimentary system prevalent during the early centuries of Islam, a fresh definition of Riba is needed and the earlier, or traditional definition, if any, developed by the early doctors of Islamic Fiqh suited only their time when the economy was based mostly on barter rather than complex paper currency system. According to this opinion, Riba has to be redefined afresh in every age keeping in view the existing economic realities, monetary system and financial institutions of the time. The new definition, it is contended, should be liberal, accommodative and contributive to economic progress and well‑being of the people; it should be free from the limited approach of the medieval jurists who, according to this view, were not exposed to such complex and difficult problems as are faced by the modern jurists and the contemporary economists. The upholders of this view differentiate between interest and usury and take pains to show that Riba is synonymous with usury and is basically different from the present day interest. Basing their argument on the Qur'anic verse (4: 160‑161) which refers to the prohibition of Riba in the Jewish law, they argue that the Jews were known for charging interest at exorbitant rates employing all sorts of harsh, coercive and treacherous methods. In their society, Riba was extracted from the poor along with a pound of flesh. However, those who propound this view do not themselves come out with any definite, clear and viable definition of Riba which should exclude bank interest and cover only usury charged at exorbitant rates. Any worthwhile logically phrased and technically defensible definition is bound to be such that either it would exclude everything, even what is conceded to be usury at exorbitant rates or it would include everything traditionally considered Riba by Muslim jurists including the bank interest regardless of its rate.
Despite this difficulty, some scholars have tried to develop a theory of Riba in such terms as may be helpful to exclude bank interest from the ambit of Riba. We wish to thoroughly examine their views and weigh the arguments marshalled in support of this interpretation of Riba. But we have noted that either the upholders of this view do not give any definition of Riba, or, if they do, it is either all‑inclusive or all‑exclusive. Therefore, one is left with no other option but to accept the definition of Riba agreed upon by almost all the commentators of the Qur'an, the Hadith, the jurists the classical and traditional writers on Riba. This definition has been phrased differently by different scholars but, in fact and in effect, there is no material or substantial difference among them. However, we shall come back to the definition of Riba later. Before discussing the definition of Riba as agreed upon by the overwhelming majority of the Ummah, it is advisable that the minority view of those who do not consider bank interest as Riba is discussed in detail. Among those who advocate this view, the names of Sayyid Rashid Rida, Maulana Jaafar Shah Phulwarwi, Syed Yaqub Shah, Dr. Fazlur Rahman, Mr. Justice Qadeeruddin Ahmed and Shaikh Muhammad Sayyid Tantawi are prominent and deserve mention. The views of earlier four scholars were summarized and condensed in a scholarly article by late Mr. Justice Qadeeruddin Ahmed. Out of these, the views of Sayyid Rashid Rida, Shaikh Muhammad Sayyid Tantawi,. Dr. Fazlur Rahman and late Justice Qadeeruddin Ahmed deserve deeper examination because their views and findings were placed before us by the counsel of some of the parties as well as by Mr. Khalid M. Ishaque and Mr. H. U. Beg a former Secretary Finance to the Government of Pakistan who appeared before us on his own initiative. Although the views of other scholars, namely Maulana Jafar Shah Phulwarwi and Syed Yaqub Shah were not formally quoted before us, yet we have taken notice of their views because of the prominent stature these scholars possess. These views have a tendency to influence such people who may not have profound or systematic knowledge of Islam‑ and may be carried away by the apparent force of their arguments. This is evident by some letters written to us by some people as well as some newspaper articles.
We have gone through all this material. It is evident from perusing this bulky literature that a lot of time, resources and energy has been exhausted by these scholars in exploring and determining the meaning and interpretation of Riba as used in the Holy Qur'an to determine whether interest and profit in vogue in our present day economic and financial system fall under the purview of Riba. It is contended that Islam being a progressive religion and a way of life for the `Muslims', the question of Riba should be resolved with a progressive approach so that the progress brought about by the modern economic system does not halt and the journey to progress is not disturbed. In such‑like arguments reference is always made to the Jews. It is said that since ages Jews have been particularly reputed to be experts in usurious business i.e. charging exorbitant rates of interest by employing all sorts of harsh, coercive and treacherous methods for extracting interest with a pound of flesh. After narrating the details of the harsh attitude of Jewish money‑lenders, it is claimed that the position about interest (as used in our day‑to‑day transactions) is entirely different from usury or Riba. In the case of interest it is claimed that there is no compulsion or coercion but it is a simple agreement for levy of a small sum to be paid by the borrower for the use of money. It is contended that the payment of interest is justified because the principal money is used for financing public welfare projects and enterprises in public and private sectors. On the basis of this difference between usury and interest, it is asserted that the bank interest is not Riba and that the misconception has been created by those who do not differentiate between usury and interest.
?
Following are main grounds on which bank interest is claimed to be different from Riba:‑‑---
(i) The prohibition of Riba as laid down in the Holy Qur'an should not be interpreted in isolation without considering the context or background in which these verses were revealed as well as the situation in which this prohibition was applied. This neglect or disregard of the context is bound to result in misconception. ?
(ii) That Riba has a relationship with economic and financial? system of Islam and unless there is an ideal Islamic society,?? free from want, corruption and avarice in the true sense of the? terms it is not proper to enforce any of the Qur'anic Injunction in isolation.??????????
(iii) Some people also contend that the traditional sources of Government income in an Islamic system are restricted to only four sources, i.e. Zakat, Ushr, Jizyah and Ghanimah. In view of the pitiable condition of Zakat and Ushr collection, the Government cannot rely on these sources alone and has to resort to borrowings which, according to this view, cannot be ensured without the payment of interest. Reference is made to the deplorable situation of the distribution of Zakat in which mismanagement and embezzlement is known to all and sundry, There being no question of the levy of Jizvah and Ghanimah in the present days, no alternative is left except borrowing on interest. It is asserted that under the Islamic system no taxes, duties, cesses can be levied as they are all un‑Islamic. But the Government has to undertake development work for the welfare of people for which resources are needed which can only be obtained through taxation and borrowings from local as well as foreign lenders.
(iv) Government also borrows and inculcates the habit of savings among people. The money thus collected is used for welfare projects whereas some profit or interest is given to the persons who contribute to these savings schemes.
(v) In the absence of any dependable system of welfare for the old and the needy, people want to keep something for the rainy day. If investment is made in a savings scheme both the Government and the people enjoy its benefit. Such people can neither work or toil nor can they incur the risk and face the ordeals caused to them by the so‑called finance companies in the early eighties. For such people, it is argued, there is no other viable option except to deposit their savings in banks and receive the interest accruing from such investment. The interest accruing on such savings, therefore, should not be equated with Riba.
(vi) There are various methods of deceiving oneself through change of nomenclature. One may call it PLS account or mark‑up, yet, this is that very old system which is prevalent since last century. This experience shows that the present system based on interest cannot be changed.
(vii) The spirit of Islam is the welfare of the people and should remain a predominant factor.' The present interest has provided welfare to the people. There is no exploitation in this system; exploitation has been committed by the vested interest and not by the present day banking system.
These are some of the grounds or arguments advanced by the advocates of bank interest at the popular level in support of their plea. During the hearing of this case quite a good number of newspaper articles have appeared in some of which the views summarized above were expressed. A number of letters, notes and memoranda were sent to us reflecting the wishes and sentiments of the writers concerned. Of these, some supported the view that batik interest was not Riba. They based their opinion by and large on these very grounds summarised above. These arguments will be dealt with in the course of this judgment at a proper place. Let us first examine the views of the scholars whose writings have been referred to by some experts as well as learned counsel of some of the parties:
First of all we take up the views of Sayyid Rashid Rida, being the oldest and the most widely respected among the advocates of this view, and also for the fact that Mr. Khalid M. Ishaque who had relied mostly on these views, complained that the learned Federal Sharait Court neither allowed him to elaborate these views nor dealt with those aspects, nor considered them in the impugned judgment.
The views of Rashid Rida are found in a booklet presented to us along with an English translation by Mr. Khalid M. Ishaque. The English translation being extremely poor, if not altogether faulty, we have discarded it and confined our examination to the original Arabic text entitled "Riba and Commercial Dealings in Islam" (published in Cairo, 1960 along with a Foreword by Shaikh Muhammad Bahjah‑al‑Baitar). This booklet is, in fact, the writer's response to a set of questions put to him by some people from Hyderabad Deccan, India, in early thirties or late twenties of this century. The booklet includes a lengthy Istifta (a request seeking legal ruling by a Mufti) covering 39 pages (pages 10‑‑48) of the booklet followed by the detailed answers given by Rashid Rida and reproduced at pages 49‑‑103. The long Introduction to the Istifta gives the four questions sent to him from Hyderabad Deccan. It also summarizes the discussion prevailing on the question of Riba in the sub‑continent. The Introduction is well‑researched and contains a fund of references to the wide range of books of Tafsir, Iladith and Fiqh. References to Fiqh books are overwhelmingly from Hanafi books with the exception of very few. This Introduction is followed by the following four questions‑‑
(1) Whether the term Riba as used in the Qur'anic verse: "Allah has permitted trading and prohibited Riba" requires any explanation or not, particularly according to the Hanafi Jurists? What is briefly the explanation of this term given by the Law‑Giver in the Qur'an and the sound (or Sahih) Ahadith?
(2) Kindly explain the meaning of Riba as used in the Qur'an and the sound Ahadith.
(3) Whether the stipulated and definite amount of profit to be paid on the loan is Riba according to the Nass or not?
(4) If it is held that the stipulated profit on the loan is Riba then what is the argument in support of this view from the sources recognized among the Jurists.
These questions were answered by some Indian scholar(s) whose name(s) have not been mentioned in the booklet. However, the answers given may be summarized as follows:‑‑
(1) The Riba as mentioned ‑in the Qur'anic verse (2:275) needs explanation and elaboration according to the Hanafis as well as according to other Jurists. It may well be said that the Ummah has unanimously held this view and the Ahadith reported by Ubadah ibn Samit furnish the required explanation and elaboration to this term according to the majority of the Jurists. (Elaborate discussion on the Ahadith reported by Ubadah and other companions will come later in this judgment.)
(2) Riba is the increase which has no corresponding consideration in an exchange of property for property. Thus, there is no discrepancy or difference between the meaning of term Riba as used in the Qur'an and the meaning of the term as used in the Hadith because the Riba mentioned in the Hadith is only an elaboration and explanation of the Riba mentioned in the Qur'an.
(3) The stipulated profit on a loan is not Riba according to the Nass because it has no proof from the Qur'an or from a sound Hadith.
(4) The view that the stipulated profit on a loan is Riba is not supported by the Qur'an or the Hadith. Sometimes it is substantiated by Qiyas (analogical reasoning) and sometime by the Hadith which says: "every loan which entails any benefit or profit is Riba". Both these arguments require reconsideration. The argument based on analogical reasoning is not sound because there is no common ground or illah between the original case and the present case. As to the second argument it is also inadmissible because it is based on a weak Hadith which cannot be accepted as a basis of argument. Even if we accept the argument that analogical reasoning is sound it is subject to change with the passage of time; because rulings and views based on analogical reasoning are subject to change with the change of environment and circumstances.
The istifta containing the long introductory Note along with the above brief answers to the four questions was referred to Sayyid Rashid Rida for an authoritative ruling and/or confirmation of the above answers. Rashid Rida praised the Note along with the answers and spoke highly about the author of the Note. He pointed out at the very outset that the Indian author, despite of the depth of his knowledge and the mastery over the subject, had confined himself to the views of the Hanafi jurists while the subject required that it should have been studied in the larger perspective of Fiqh in general without adopting a certain ruling or abiding by the rules of Ijtihad followed in any particular legal school. However, Rashid Rida did not confine himself to subscribing to the views of the Indian scholar but also gave his own opinion. However, he did not agree with the definition of Riba as given by the Indian author in his response to the second question and insisted that Riba was always in a debt and was not confined to a loan or to a deferred price. According to him, the original Qur'anic Riba was different from the Riba of the Hadith. The latter, namely the Riba of the Hadith had been prohibited because it might have led to the perpetration of the Qur'anic Riba. Otherwise, he maintains, the Riba of the Hadith does not directly fall under the Qur'anic prohibition and condemnation of Riba since it does not involve that enormous evil which is represented by the Qur'anic Riba. Rashid Rida had spoken at length on the answer to the fourth question as, according to him, this constituted the basis of the whole discussion.
The nutshell of the views of Rashid Rida is that it is only the Riba al‑Nasi'ah (also called Riba al‑Qur'an and Riba al‑Jahiliyyah) which is prohibited in the Qur'an. All other kinds of Riba prohibited by the Prophet (p.b.u.h.) are only by way of preventive measures. He expresses his disagreement with those who consider both kinds of Riba to fall under one and the same category, He contends that most of the opinions and rulings given by the jurists in respect of Riba have no support from the Shariah directly or indirectly. According to him, this extended meaning of Riba is neither in consonance with the fundamentals of Islam nor any principle of legislation nor is based on any ratio decidandi drawn from the divine revelation dealing with the prohibition of Riba. He disagrees with the views of Imam Abu Hanifah who says that the exchange of two fungibfe (i.e. countable, measurable or weighable) commodities with an excess is Riba.
The large body of legal rulings developed by the jurists on the basis of this understanding of Riba, according to Rashid Rida, is irrational and unsubstantiated by the scriptural authorities. In this context, Rashid Rida comes out with vehement criticism against the Jurists and considers it to be an intervention in the divine prerogative to determine what is lawful and what is unlawful. He goes on citing examples where a Hanafi jurist considered something to be unlawful and which should not have been held unlawful in the opinion of Rashid Rida or any other jurist.
Although Rashid Rida claims to take up the question of defining the contours of Riba al‑Jahiliyyah prohibited by the Qur'an, yet his treatment of this subject is self‑contradictory. On the one hand, he establishes that the term Riba as used in the Qur'an was clear and express and was fully understood by the addressees of the Qur'an, namely, the Companions. On the other hand, he tries to develop a definition on the basis of some illustrative reports found in the Hadith literature about the nature of Riba and Riba‑based transactions prevalent in pre‑Islamic Arabia. He picks up one such report recorded by several authorities and concludes that Riba is only that increase which is agreed upon by the parties at the stage of maturity of the initial loan if the borrower is not in a position to pay. Any increase, irrespective of its weight, measure or quantity agreed upon between the two parties at the time of the initial taking of the loan is not Riba according to the Egyptian scholar. To put it in more clearly and elaborately, following illustrations will explain the position taken by Rashid Rida: "'A' takes Rs.1,00,000 as loan from 'B' to be paid after one year with an increase of 20% . This initial increase of twenty per cent., according to Rashid Rida is not Riba. However, if 'A' is not in position to pay Rs.1,20,000 to 'B' at the stipulated time and 'B' demands that in order to get more time 'B' should extend the period of maturity and, in turn, 'A' increases the payable amount from Rs.1,20,000 to Rs.1,50,000, only this additional amount of Rs.30,000 will be Riba". In order to get support for this strange and queer interpretation, Rashid Rida has collected a host of references from different texts of Tafisr, Hadith and Fiqh. However, even a cursory look over this large number of passages and quotations shows that no single quotation or passage supports the position taken by Rashid Rida. Moreover, the general discussion made by him about the nature of Riba and the rationale of its prohibition not only does not support his contention but also ultimately goes against him. The literal meaning of the word Nasa and Nasi'ah, the illustrative example quoted by the early authorities as well as the rationale of the prohibition of Riba al‑Fadl as discussed by Rashid Rida himself, all go against the interpretation advanced by him. It is strange that while he expressly and unequivocally considers Riba al‑Nasi'ah to be the prohibited Qur'anic Riba, he tries to apply all the relevant passages where Riba al‑Nasi'ah has been discussed to his own understanding of Riba and insists in a sheer arbitrary manner that all earlier scholars also meant by Riba al‑Nasi'ah what he. himself means. He has simply ignored the very pertinent question why the increase on the first Nasi'ah (deferred payment) should not be considered Riba and why only the increase or increases on the second or subsequent Nasi'ah(s) (deferred payments) should be considered Riba. Even if this strange interpretation is taken to be correct for a moment for the sake of argument even then many forms of bank interest will fall under the category of Riba prohibited even by Rashid Rida. Under no logic or argument can the interest accruing as a result of the first delay be excluded from tile Riba as defined by Rashid Rida. Nor the subsequent increases in case of further delays and defaults be considered to be the only increase included in the Riba. All such subsequent increases will have to be counted as second or third increase over and above the principal amount plus the first increase. Neither Rashid Rida nor Mr. Khalid M. Ishaque addressed this question. In short, the views of Rashid Rida are Islamically untenable, logically inconsistent and practically inconsequential in so far as these latter forms of increase or increases are concerned. In spite of academic value of the material contained in the booklet it fails to serve any useful purpose in offering a viable and practical solution to the question of Riba. .
Following this argument, Mr. Khalid M. Ishaque has also highlighted the report found in the celebrated commentary of the Qur'an by Imam Abu Bakr Jassas Razi, entitled Ahkam al‑Qur'an in an effort to develop a working definition of Riba. According to him, only that kind and brand of Riba is prohibited by the Qur'an which was prevalent in pre-?Islamic Arabia. Any definition of Riba, therefore, should confine itself only to that brand and must of necessity be exclusive of any other increase. According to this report when a person (a debtor) failed to pay his debt by the stipulated time, he was given the option by the creditor either to pay then and there or to increase the payable amount (in consideration for further time). Mr. Khalid M. Ishaque considered only this kind of increase as Riba to the exclusion of all other forms of increase over and above the principal amount. To him, this is the Riba of pre‑Islamic days which was prohibited by the Qur'an. On a closer and deeper examination, however, .it transpires that even this solitary example of one of the prevalent forms of Riba has all the elements of Riba as defined by Muslim jurists. The nutshell of this deal is the increase over and above the principal amount payable in a contractual obligation against nothing but time. Moreover, if the debtor failed to pay even after the extension of period and increase on the principal amount, he was again to seek further time and to agree to further increase both on the principal and the first increase put together, making the Riba doubled and redoubled. Today, when a person borrows from a bank, a financial institution or a credit company and fails to pay the debt at .the stipulated time, he has to accept the increase according to the prevalent rate; and if he fails to pay the amount (principal plus the first increase) at the second stipulated time he has to pay further increase or increases calculated exclusively in terms of time. Therefore, even if we accept the contention that this was the only form of Riba prohibited by the Qur'an, it would fail to exclude bank interest from its ambit.
Counsel for several appellants and some experts, including Mr. Khalid M. Ishaque and Mr. Abu Bakr Chundrigar, also referred to the view of late Mr. Justice Qadeeruddin Ahmed on the permissibility of bank interest. It was again and again complained that the learned Federal Shariat Court did neither properly examine the views of the late jurist nor assessed his arguments. It was contended that if the learned Court below had thoroughly and impartially examined his views on the subject, it would possibly have reached a different conclusion. Mr. Abu Bakr Chundrigar presented before us the views of late Mr. Justice Qadeeruddin Ahmed and submitted that he fully endorses his views and adopted his arguments. Copies of the articles written by Mr. Justice Qadeeruddin Ahmed were also supplied to us by Mr. Chundrigar. We intend to examine here the views of the late savant in detail. Following are the main points discussed by Mr. Qadeetuddin Ahmed: ‑‑
(i) Only one kind of Riba out of several kinds, Riba al‑Nasi'ah has been prohibited by the Qur'an. The learned jurist here refers to the book of Mr. Nabil A. Saleh, entitled, Unlawful Gain and Legitimate Profit in Islamic Law where various kinds of Riba have been discussed. According to Justice Qadeeruddin Ahmed, the expression (Riba) refers for the form of loan which was in vogue in Arab Society before the advent of Islam. Only this kind of Riba (Riba of the Jahiliyyah) is directly forbidden by the Qur'an.to the exclusion of any other form of Riba.
(ii) The Qur'an has condemned Riba al‑Jahiliyyah but has neither described it nor explained its modus operandi. The Holy Prophet (peace be upon him) too has provided no guidance in this respect. The Qur'an does not tell us what was the mechanism of Riba al? Jahiliyyah and how that mechanism functioned. The learned jurist says that the detail of the manner in which a debt increased has not been explained. He does not know whether it was simply an amount added to the payable due or the capital amount itself was inflated, The language of the verses, nevertheless, indicates that the increase was enormous. It also tells us that there was wickedness, serious injustice and iniquity in these transactions. But we are not told clearly as to what amount was doubled and redoubled. Was it the amount that was increased by reason of a default, namely interest or was it the capital amount itself was doubled and redoubled?
(iii)?????? The same language (i.e. threat of war with Allah and His Prophet) was used by the Prophet (peace be upon him) for those who would lease out their land to tillers on the condition that they would share the income with the tillers. The Prophet (peace be upon him) pronounced: "One who does not give up lease of land (Mukhabarah) for a share of its produce must be prepared for war with Allah and His Messenger (peace be upon him)." This ban on leasing has been treated very differently and lightly by the Muslims as compared to the ban of Riba on loans.
(iv)?????? The alternative methods suggested for the enforcement of interest? free banking system in Pakistan do not adequately, meet the requirements of the existing system and do not respond to the needs of international commerce because of the involvement of foreign countries and non‑Muslims in this complex exercise.
(v)??????? The Islamic juristic science has by virtue of interpretation played a controlling role by telling the mankind what Allah and His Prophet (peace be upon him), have conveyed to humanity.
(vi)?????? The second caliph, Umar said: "The verse of Riba (i.e. the verse which forbids Riba) is among those which were revealed during the last days of the Prophet (peace be upon him). He passed away before explaining its implications to us". Justice Qadeeruddin Ahmed says that the observation of Umar refers to the verse of the Qur'an which prohibits Riba and not to an act or observation of the Prophet (peace be upon him). The Prophet (peace be upon him) was not able to explain the implication of the Divine command since he did not live long enough to do so. The Prophetic prohibition of Riba as contained in his Farewell Address anticipated the prohibition of Riba al‑Jahiliyyah which came a few months later in the form of the Qur'anic revelations. The Second Caliph Umar ,appears to have noted that our knowledge of the subject was inadequate but he did not attempt to augment it because obviously the issue was of too serious and delicate a nature for any Muslim to assume the responsibility of playing that vital role. The actual situation therefore remains that neither the Qur'an nor the Prophet (peace be upon him) has explicitly told us as to what precisely the prohibited transactions were which are referred to as Riba in the Qur'an and are referred to as Riba al‑Jahiliyyah by the jurists. Caliph Umar was ratable to solve the problem of discovering what exactly Riba or Riba al‑Jahiliyyah was. Umar's simple and practical advice was, "therefore you should shun all those transactions which clearly involve Riba as well as those regarding which there may be doubt that Riba is involved in them". This was a stern decision which neither explained Riba nor removed doubts. Secondly, the lament of Umar over the absence of Prophetic guidance has been amply justified by a voluminous growth of literature on this subject which is the creation of juristic predilections.
(vii) In spite of all this wealth of thought and wisdom the Muslim world of today presents no true image of the transaction of Riba. It only "~'''' offers by way of substitute the misleading concepts of interest, usury and slid.
(viii)Riba is essentially a concept which deals with economic problems and is meant to save the Ummah from cruel exploitation of the needy by the rich and of the weak by the powerful.
(ix)?????? The learned jurist quoted from Encyclopaedia Brirmrnica: "In ancient and medieval times, the main focus of inquiry into the theory of interest was ethical and the principal question was the moral justification of interest. On the whole, the taking of interest was regarded unfavourably by both classical and medieval writers. Aristotle regarded money as "barren" and the medieval school‑men were hostile to usury. Nevertheless, where interest fulfils a useful social function, elaborate rationalizations were developed for it".
(x)??????? The Prophet (peace be upon him) encourages debtors to voluntarily return more money or a better animal than was borrowed. He himself acted on this principle.
(xi)?????? The need of clarifying the concept of Riba has been so persistent that to this day it has not been differentiated from the concept of sud or interest, although, they are clearly different in nature and far apart. Muhammad Asad has pointed out that the word "usury" too is not synonymous with Riba. Riba is more often translated into English as "usury" than "interest", because the word "usury" means in the modern usage charging unconscionable interest rather than the ordinary interest.
(xii) Impartial observers who have a worldwide reputation for their knowledge of Islamic thought like Joseph Schacht and Mixim Rodinsen have noted in the Shorter Encyclopaedia of !slam and in Islam mid Capitalism respectively, that the concept of Riba which has been banned by the Qur'an has not been precisely delineated by the Muslims.
(xiii) The concept of interest also has features which are wholly absent from the concept of Riba. For example, there can be simple interest and compound interest (i.e. the maximum permissible rate of interest) as well as gross interest (i.e., interest inclusive of administrative cost and expenses).
(xiv) Riba was never completely and practically forbidden to Islamic history. Prof. Dr. Hamidullah has said: "As far as my study is concerned during the life of the Prophet (peace be upon him), and in the regimes of the four righteous Caliphs there were Muslims who borrowed [money on interest] from non‑Muslims". Justice (Retd.) Sheikh Aftab Hussain, a former Chief Justice of the Federal Shariat Court, has, in an interview given to the daily Muslim stated as follows: "For the last 1400 years except for the period of the first four Caliphs, interest was not forsaken. None of our Ulema ever felt disgusted by the payment of interest of a Muslim to (non ?Muslim) money‑lenders. Not only ordinary Muslims but Governments and Abbasi Caliphs used to take loans and hypothecate to the Jews the income of some territory which always far exceeded the principal amount. The Turkish Caliphs who presided over the destinies of the Ottoman Empire borrowed money in millions in the nineteenth and twentieth centuries at exorbitant interest rates from England and other European countries.
(xv) The transactions that are prohibited by the Qur'an are those in which there was injustice, wickedness, inequity and demand for doubled and redoubled amounts of money. Lending money is not always an act of injustice or wickedness. It can be a blessing to a poor person in whose dark day nobody is prepared to pay any heed to his needs.
(xvi)???? The conclusion is that Riba is not the interest of modern times, if we carefully read together the two verses of the Qur'an, provided that the word usury, or interest or sud (which is a Persian word meaning profit) is not arbitrarily introduced into them in the place of the Qur'anic word, Riba. There seems to be no doubt that according to the Qur'an the word Riba does not mean the additional amount of interest or usury or sud. The context shows that it means the capital sum which was doubled or redoubled.
(xvii)???? For us the choice is clear because we have in support of our view the acts of the Prophet (peace be upon him). It is well known that he sometimes paid more money to his creditors than that was borrowed by him and termed the excess to be a gift. The practice of charging Riba which obtained in pre‑Islamic Arabian society, is found to be peculiar to those times and to that territory. It no longer exists in any Muslim country, nor in any other country of the world. The upshot of his discussion is that Riba was not a system of charging interest, in the sense in which the term "interest" is understood and used today.
These were the main points raised by late Mr. Justice Qadeeruddin Ahmed in his oft‑quoted essay. ‑ Now we take up these points for a careful examination. In this examination we have benefited from the writings of Mr. Anwar Ahmad Meenai, Dr. Tanzilur Rehman and Maulana Mufti Muhammad Shafi.
The contention of the late jurist that the alternatives so far suggested to replace interest do not adequately meet the requirements is superfluous as according to him neither the bank interest is Riba nor it requires to be substituted by any alternative. Moreover, the mere claim that the alternatives are not adequate cannot be accepted without any supporting argument. Today, when more than one hundred and fifty banking and non? banking financial institutions are working around the globe on the basis of these alternatives it is strange to assert that these are inadequate. Furthermore, these alternatives have been suggested not by traditional Ulema but by professional bankers and trained economists. But the most significant assertion of late Mr. Justice (Retd.) Qadeeruddin Ahmed is that the term Riba as used in the Qur'an is very peculiar and is undefinable and untranslatable. Let us see whether the Qur'an has left the term, Riba, undetermined and unspecified, because no formal definition occurs in spite of the stern warning issued to its perpetrators. When we read verses 278‑279 in Surah al‑Baqarah, we get the following message: "O believers, fear Allah and give up whatever is left of Riba if you are believers. But, if you do not desist, then take notice, of war from Allah and His Messenger; and if you repent you can have your. capitals or Ra's al‑Mal". In this verse, the plural of Ra's al‑Mal, namely, Ru'us‑u‑Amwalikum has been used. Ra's al‑Mal (singular) literally means the capital or the amount originally invested in a business by the financer or the investor. In the case of loan, it simply means the principal amount, i.e., the amount originally lent. It is more than obvious in this verse that Qur'an prevents the Muslims from claiming anything over and above the principal amount. Even the literal meaning of M the word Riba clarifies that it means the increased amount paid or claimed in excess of the principal by the borrower or the lender. It has been called Riba which is exactly what interest means.
It may be emphasized here that the style of the Qur'an is neither that of a dictionary nor of a law book in the technical sense. It is a guidance revealed for the benefit of the entire mankind and is couched in a language which is easily understandable even by the common reader. It has been revealed in clear and express Arabic, or Arabiyy Mubin. It always uses Arabic terms which were well known to the people to whom it was first addressed. These terms conveyed the popularly understood meaning unless the context suggested otherwise or the Prophet (peace be upon him) guided his followers to the real meaning or the actual intent if it was different from the obvious or apparent meaning. Qur'an has used many other terms like Shirk, Kufr, Zina, Khamr, Maisir and Sariqah' to cite only a few examples; but nowhere these terms have been defined in the Qur'an in the technical style of a law‑book or a lexicon. Yet, with the help of Arabic dictionaries, the practical demonstration by the Holy Prophet (peace be upon him), the explanations given by the Companions and the Followers (or Tabi'un), the interpretations given and the details worked out by the Muslim jurists and scholars, each of these terms stand fully defined, candidly explained and clearly understood. The Prophet (peace be upon him) and his Companions around him and the Followers and the disciples of the Companions did not need any lexicons to understand and interpret these terms, since Arabic was their native language and they had the taste of the language. As soon as a verse was revealed they, both friend and foe alike, understood its meaning and received the message. They knew that the style of the Qur'an was to provide only the fundamental axioms while the Sunnah enunciated the detailed principles. On the basis of these two foundations the Companions and their disciples developed the elaborate law. The Qur'an and Sunnah, thus, do not provide such details of the matters relating to each principle as may be developed by the jurists. The function of divine revelation is not to suspend human mind and to take over the province of independent human reasoning too. Its function is to provide the basic guidelines and to leave the matters of detail to be decided by human reasoning.
The learned jurist here has totally ignored the meaning of the term Ra's al‑Mal (the plural of which is Ru'us al‑Amwal used in verse 279). If the Qur'an is to set limit to fundamental axioms then it categorically requires that the lender is entitled only to claim his Ra's al‑Mal. Abdullah Yusuf Ali. whose translation has been relied upon by late Mr. Justice (Retd.) Qadeeruddin Ahmed, has translated the term Ra's al‑Mal as "capital sums". Here, a question may be raised in line with the thinking of the late jurist as to how can one define the capital sum; more importantly, how can one prove that capital sum includes "reasonable" amount of interest which, according to him, is not Riba. But this very verse has provided a clear answer to this question. By restricting the claim of the lender to claiming his Ra's at‑Mal only, the Qur'an has categorically and explicitly declared that even a single penny paid or claimed in excess of Ra's at‑Mal is Riba. This is precisely what present day interest means irrespective of the name given to it. Immediately after restricting the lender's claim to the Ra's al‑Mal to the exclusion of any other sum, the Qur'an has added La Tazlimuna wa la Tuziamun (neither you deal unjustly nor you should be dealt with unjustly). This phrase lays further stress on the principle that claiming anything in excess of Ra's al‑Mal is unjust. Similarly, borrower's refusal to pay back the Ra's al‑Mal is equally unjust. In the verse that immediately follows the above verse, the Qur'an says: "but if he (the borrower) is in financial difficulties give him time to repay until his circumstances improve and if you remit by way of charity (i.e., write off the Ra's al‑Mal) it is better for you, if you understand" (2:280). This verse further clarifies that Riba includes anything paid in excess of Ra's al‑Mal (irrespective of the name given to it). The Qur'an has urged upon the lender to even remit the Ra's at? Mal if the borrower is facing financial difficulties. It is again a categorical indication of the philosophy that Qur'an wishes to foster and inculcate in the minds of the Muslims.
This concern of the Qur'an can hardly be compatible with the mentality the interest‑based system creates. It is difficult to agree to the contention that on the one hand, the lender is asked to remit even the Ra's al‑Mal and at the same time, he is allowed on the other hand to charge a "reasonable or conscionable" interest as advocated by the learned jurist. Another question may also arise: What is the definition of "conscionable" and "reasonable" interest? Who and under what authority will lay down this definition'.' The commercial rates of interest range between 10% to 22''% per annum in Pakistan. In the past, lease financing was available at the annual rate of 28‑‑32 per centum. Will this rate be accepted as a reasonable rate? If so. then what would be the unreasonable and unacceptable rate?
The claim that the Prophet of Islam, peace be upon him, provided no explanation or guidance to solve the important problem of how to define Riba is an extremely serious statement which borders on irresponsibility if not anything more serious. Towards the close of the worldly mission of His Messenger, Allah categorically declared, "Today I have completed for you your Diet and have perfected My blessings and chosen Islam as , a Din for you". (Qur'an, al‑Ma'idah: 3). During the Farewell Pilgrimage in the year l0A.H., the Prophet (peace be upon him) delivered the celebrated Farewell Address and asked everyone present: "Have I conveyed to you the message of Allah in its entirety?" The unanimous reply from more than 1,00,000 Companions was "Yes" to which the Prophet (peace be upon him) is reported to have raised his finger to the sky and said "O Allah! Be a Witness to this (affirmation)". It was on the same occasion that the Prophet (peace be upon him) declared that all outstanding claims of interest, including those due to his own uncle Abbas ibn Abdul Muttalib were null and void, and were given up. Even more queer is the claim that the Prophet (peace be upon him) tacitly and by implication approved the payments of increase over and above the principal amount loaned. This claim has been based on a report found in the Hadith books that the Messenger of Allah returned voluntarily something better or more than he had actually borrowed. One cannot and should not be oblivious to the obvious difference between a voluntary payment and a compulsory demand as a matter of right. Today a lender has the right to get this increase paid to him through the Courts'. There is a world of difference between this and the action of the Prophet. What the Prophet (peace be upon him) did was in keeping with the Islamic principal of Ihsan which is an important cornerstone of the social teachings of Islam and which seeks to promote better dealings among members of the society. Present day interest, on the other hand, is stipulated as a contractual obligation. Nowhere the Prophet (peace be upon him) or any of his Companions ever borrowed with even the slightest hint of a promise, not to speak of a contractual obligation, to repay with something better or more than the quantity borrowed.
The assertion that Hazrat Umar did not know what Riba was, is again a very strange claim. To say the least it amounts to impose an opinion on the Shariah rather than submitting to the clear and emphatic Injunctions of Qur'an and Sunnah. Hazrat Umar accepted Islam at the grown up age of thirty‑one years. Prig to it and even after having embraced Islam, he earned his livelihood through trading and business for which his family was known throughout Arabia. At this time the practice of charging
Riba was common and was well known among the merchants in Makkah as well as other parts of Arabia. Riba to them clearly meant stipulated increase on the amount payable in a loan or credit transaction, in consideration of time. The meaning of Riba as understood by the Arab traders before Islam is evident from the following definitions and explanations given by leading Muslim authorities of the early centuries of Islam. To quote only a few of these authorities only by way of illustration: According to Qatadah ibn Diamah Q (d. 120 A. H), a
Tabii and a known authority on Tafsir and Hadith, Riba of the period of
Jahiliyyah was as follows: a person would sell something to another and allow a moratorium for payment of the price. If the buyer did not pay on the agreed date, the period was extended and the amount was. increased. This was Riba.
According to Mujahid ibn Jabr (d. 86 A.H), a disciple of the Companion, Abdullah ibn Abbas, Riba of Jahiliyyah was that a person would borrow from another and promise to repay more if he was given a certain period of time to repay. Imam
Abu Bakr Jassas (d. 390 A.H.), a Hanafi jurist of note and fame, has established that during the period of Jahiliyyah when people used to borrow from each other, it was usually agreed that a specific amount more than the sum borrowed would be repaid. Imam Fakhruddin Razi (d. 606 A.H.) an authority on rational interpretation of the Qur'an, has also established that during the period of Jahiliyyah, people used to lend for a specific period. Interest was charged from the borrower on a monthly basis. Upon maturity of the term, the repayment of the principal amount was required. If the borrower was unable to pay, the loan was rescheduled and the amount of interest was increased.
These were the forms of business on interest which were in vogue in Arabia. Arabs used the term Riba for such transactions. This is exactly what was prohibited by Qur'an. These definitions referring to different kinds of transactions involving Riba have one thing in common: the element of increase over and above the amount borrowed, demanded in consideration of a specific time period allowed for repayment. With all the wealth of thought and wisdom about the modality of Riba and the rationale of its prohibition preserved for us by the early doctors of Islam, it is difficult to agree with the contention of late Mr. Justice Qadeeruddin Ahmed that the Muslim world presented no true image of the transactions of Riba and that it only offered by way of substitute the misleading concepts of interest, usury and sud.
It seems that the learned writer erred in quoting late Maulana Mufti Muhammad Shafi. In his article he quotes Mufti Sahib as admitting that there was some confusion or ambiguity about the true meaning of Riba. Mufti Sahib's approach is poles apart. In his masterly treatise entitled Maslah‑e‑Sud, he has categorically stated: "Upon hearing verses of the Qur'an everybody immediately realized that Qur'an referred to the obvious well known meaning of the term Riba, i.e. charging of anything in excess (of the principal) in credit or loan transactions. Everybody took it as prohibited and gave it up immediately". Same is true about the claim that verses of al‑Baqarah 279‑‑281 clearly prohibiting Riba were revealed only 9 or 30 days before the death of the Prophet (peace be upon him). This statement was never made by late Mufti Sahib. In this book Masalah‑e‑Sud, he has categorically stated that it was around 8th year of Hijrah that the last verses in respect of Riba were revealed and through which Riba was categorically and finally prohibited in its all forms.
As to the claim that Hazrat Umar lamented the lack of sufficient and adequate guidance by the Holy Prophet about Riba and that his statement "Shun all those transactions which clearly involve Riba as well as those reeardina which there may be doubt that Riba is involved in them" was a precautionary measure to put the anxiety at rest. It is also not only misleading but amounts to a thoughtless assertion about one of the closest companions and most trusted disciples of the Holy Prophet. A careful and deeper look into the statement of Hazrat Umar, is correctly attributed to him, shows the weakness of the conclusions drawn by late Mr. Justice Qadeeruddin Ahmed. If really Hazrat Umar did not know what Riba or Riba al‑Jahiliyyah was, how could he advise, "shun all those transactions which clearly involve Riba"? The people around him could have asked him as to how they could shun those transactions which involved Riba when the very meaning of Riba was not clear. If really Hazrat Umar and no one else present at that time knew what Riba or Riba al‑Jahlliyyah was, either he would himself said that he could not define Riba or someone else would have definitely asked him to first define Riba in order to enable people to avoid that which he was asking people to shun. If this were the case, Hazrat Umar's advice should have been considered something ridiculous and more confusing. On the one hand, he was not aware of what was to be avoided, and on the other, he directed the people to shun all those transactions which involved Riba or had a doubt or possibility of Riba.
The fact is that the concern of Hazrat Umar as reflected in this statement does not relate to Riba al‑Jahiliyyah or Riba al‑Nasi'ah i.e. the Riba par excellence. It relates only to Riba al‑Fadl. The Prophet (peace be upon him), had fully explained to his Companions that in addition to the excess amount charged on loan or credit sale, the term Riba would also apply to certain barter exchanges. This new kind of Riba came to be known as Riba al‑Fadl. Any difference in quantity or any deferment of delivery by one party in a barter dealing on the same commodity is termed as Riba al? Fadl and tantamounts to Riba. It was this Riba al‑Fadl about which Hazrat Umar felt the difficulty in outlining the details because the saying of the Prophet (peace be upon him) apparently specified only six commodities. It was not clear to many whether the prohibition applied only to these six specific commodities or similar things could also be included in the list to which the principle of prohibition could be applied. The fact is that the Companions of the Prophet (peace be upon him) did not ask for further details about this kind of Riba. Later on, Hazrat Umar expressed the wish that it would have been better if he or other Companions had found out further details from the Prophet (peace be upon him). The gist of the matter is that in addition to the well known and commonly accepted meaning of Riba (i.e., charging excess on amount loaned or offered as credit), the Prophet (peace be upon him) also explained that there is always a possibility that an element of Riba may be found in various forms of sale and purchase transactions. As such, the two kinds of Riba namely, (i) Riba al‑Nasl'ah or Riba al‑Qur'an and (ii) Riba al‑Fadl or Riba al‑Bai or Riba al‑Naqd or Riba al Hadith should be clearly understood and differentiated. According to R some scholars, Riba al‑Jahiliyyah included both these kinds because during, the period of Jahiliyyah, it was common for people to exchange a certain quantity of good quality dates with a larger quantity of inferior quality dates. This was mostly done by the Jews of Madinah who through such tricks controlled the economy and the agriculture of Madinah. This kind of Riba was prohibited to close the door of their exploitation and injustice. (See for details Islam ke Ma'ashi Nazaviyye by Dr. Yusufuddin, Vol. II, Karachi, 1984).
Late Mr. Justice Qadeeruddin Ahmed also emphasizes the point that during the days of the four Righteous Caliphs, some Companions of the Prophet (peace be upon him) borrowed money on interest from non‑Muslim lenders and that the Abbasi Caliphs and Rulers of the Ottoman Empire also borrowed on interest. As regards the Companions of the Prophet (peace be upon him) the learned Judge has made contradictory claims. On the authority of Dr. Muhammad Hamidullah, it is claimed that during the life of the Prophet (peace be upon him) and of the four Righteous Caliphs there were Muslims who borrowed (money on interest) from non‑Muslims. The words "money on interest" appears in parentheses. It is not clear whether these have been added by Justice (Retd.) Qadeeruddin Ahmed or these are found in the original writing of Dr. Hamidullah. In the same paragraph, it has been claimed on the authority of late Mr. Justice Shaikh Aftab Hussain, a former Chief Justice of the Federal Sharait Court, that for the last 1400 years, except for the period of the first four Caliphs, interest was trot forsaken. Notwithstanding the obvious and glaring contradiction between the two statements, one wonders as to why should Dr. Hamidullah's claim be accepted on face value without examining his arguments. Moreover, it is not clear whether Dr. Hamidullah has really said it or not. As far as mere borrowing from non‑Muslims is concerned it continued till the last moment of the Holy Prophet (peace be upon him). Even when he passed away he was to pay back a certain amount of money to a Jew with whom his coat‑of-?arm was mortgaged. As regards the Companions, some of them, such as? Hazrat Abbas and Hazrat Khalid ibn al‑Walid, had wide‑scale interest‑based business before Islam. We find several reports about their business in the Hadith literature. But one should not forget that it was in pursuance of the policy of gradualism or Tadrij adopted in respect of all major Islamic reforms, that the prohibition of Riba was also brought about in stages. An obvious indication of this gradualism is that the verse 130 of AI‑Imran was revealed in 3A.H. which prohibited charging of Riba doubled and redoubled. It may be observed here that the term Ad'aafan Muda'afah qualifies the term Riba and not defines it. As pointed out elsewhere in this judgment, the final prohibition as contained in verses 278‑279 of Al‑Baqarah was revealed in 6 or 7A.H. before the conquest of Makkah. No historical record supports the contention, even indirectly, that the Prophet (peace be upon him) condoned the usurious dealings and borrowing by Muslims after this prohibition. As to the remaining part of the statement attributed to late Mr. Justice (Retd.) Shaikh Aftab Hussain that the practice of Riba was prevalent after the period of the first four Righteous Caliphs, it may be said that the statement is not substantiated by historical record; and, even if it does have the support of history, the practice of later rulers, hundreds of years after has no legal or normative value. The authority to legislate and lay down the law or the norms belongs only to Allah. (Qur'an 6:57; 7:54; etc.). In the presence of clear and emphatic Injunctions of the Qur'an and unequivocal pronouncements of the Holy Prophet (peace be upon him) one cannot rely on the precept practice of non‑practising Muslim Rulers what to speak of non‑Muslim writers, particularly of those whose unfriendly attitude to Islam is well‑known. The statement of "impartial" observers like Joseph Schacht and such‑like scholars about the meaning and application of Qur'anic terms like Riba cannot be relied upon. The claim that the verses relating to the prohibition of Riba were revealed just few days before the death of the Prophet (peace be upon him) seems to be based on some misunderstanding or on inadequate study of the chronology of the Qur'anic verses on Riba. We have dealt with this question elsewhere in this judgment and discussed the order and the timing of the revelation of these verses. The assertion that till the Farewell Pilgrimage, Riba was practised and it was prohibited during the Farewell journey has already been refuted. In the light of our discussion, it is well established that Verses 278‑279 of al‑Baqarah were revealed in 6 or 7A.H. before the conquest of Makkah (8A.H.) and even before the expedition of Khyber (Muharram 7 A.H.). It has been reported by Imam Sarakhsi and several others, that during the expedition of Khyber, the Prophet (peace be upon him) instructed two of his Companions to refund any interest that they had charged.
Justice Qadeeruddin Ahmed also raised the issue of Mukhabarah, Muzara'ah or crop‑sharing and contended that Muslims underplayed its prohibition and overplayed the prohibition of Riba. This contention is not only highly confusing but also misleading and needs a further examination.
Since the learned judge has raised an important and difficult question which may lead to confusion it is necessary that the problem may be discussed in some detail. He has picked out a Hadith on the subject of crop‑sharing perhaps to show that the prohibition of crop‑sharing as understood by him has been neglected by the Muslims in general and by the jurists in particular He has also contended that the jurists have not given due importance to the condemnation of Mukhabarah by the Prophet of Islam (peace be upon him implying thereby that the prohibition of Riba which was also in similar terms has unduly and unnecessarily been played up. It appears that the author has not gone into other Ahadith on the subject and has not had opportunity to study the Ahadith on the subject as a whole and to arrive at a definite and sound conclusion. It may be mentioned that the Ahadith reported by Rafi ibn Khadij have been profusely misquoted and misinterpreted during the recent decades by the upholders of socialism for various motives. Efforts were made to give the impression that Muslim jurists collectively and wilfully violated the injunction of the Holy Prophet in respect of the prohibition of crop‑sharing and insisted to legalize something forbidden by the Prophet (peace be upon him?. This impression is far from truth.
In fact, there were several ways of land management and agricultural administration prevalent in Madinah, the details of which are found in the Hadith books under the chapters on Muzaraah. A cursory glance over these Ahadith shows that there were four major methods of crop‑sharing and land tenure in Madinah. Out of these four the Prophet. (peace be upon him) prohibited three and permitted one. The methods prohibited by him were the following:
(a) As reported by Bukhari, a landowner would give a tract of land to the tenant on lease on the condition that the tenant would cultivate not only the land leased to him but will also cultivate the land not leased to him by the landowner. the produce of the two pieces of lands would be respectively divided between the landowner and the tenant. According to Rafi ibn Khadij, this was prohibited by the Holy Prophet (peace be upon him) because sometimes the produce of two pieces of land was different both in terms of quality and quantity. It was injustice either to the tenant or to the landowner.? (See the Sahih of Bukhari, Chapter on Muzara'ah and Harth). It was always possible that only one piece of land would produce which the other piece of land would fail to produce anything at all. In this case the party to whom the latter piece was to be allocated was to be at an obvious disadvantage.
(b) In some cases the more fertile part of the land or the one nearer to the course of water was allocated to the landowner while comparatively barren part of the land or the one farther than the course of water was left for the tenant with the result that the land?owner received higher quality and larger quantity of the produce and the tenant was left with lower quality and lesser quantity of the produce. In some cases the part allocation to the tenant did not give any produce at all and the landowner took the entire produce. Such arrangements were also prohibited by the Holy Prophet (peace be upon him) as reported by Muslim (chapter on Sales). However, if the. landowner did not fix any particular piece of land for himself and the produce of the whole of the land was divided on the basis of same proportion it was allowed.
(c) In some cases the tenant was required to pay to the land‑owner a certain amount of some other produce such as dates etc. other than the one grown on the land. This was also prohibited by the Holy Prophet (peace be upon him) because it also involved injustice to the tenant as nobody could foresee whether his share in the produce would be equal, less or more than the value of the commodity demanded.
(d) As reported by Bukhari on the authority of Jabir ibn Abdullah, some people leased out their land to the tenant on the condition that a certain percentage of the produce would go to the tenant. This arrangement was allowed by the Holy Prophet (peace be upon him). Not only a large number of Companions but also the Holy Prophet himself entered into this kind of arrangement with their respective tenants. This is a kind of agricultural Mudarabah which was in practice in pre‑Islamic Arabia and continued to be in practice after Islam. A similar arrangement was made by the Holy Prophet (peace be upon him) himself with the tenants working on his land situated in Khyber. Many lady companions, particularly the wives of the Holy Prophet (peace be upon him) who were allotted agricultural lands in Khyber and other conquered areas had made similar arrangements with the tenants working in their respective lands. This view has been held by the overwhelming majority of the Companions and other jurists including Imam Malik, Sufyan Thawri, Layth ibn Saad, Imam Sahfi'i and Imam Abu Yusaf and Imam Muhammad from amongst the Hanafis.
In the Hadith literature, a large number of Ahadith have been quoted dealing with different kinds of land tenure mentioned above. The Ahadith in which prohibition has been quoted apply to the earlier three categories mentioned under (a), (b) and (c) above. On the other hand, the kind of arrangement mentioned under (d) has been allowed and was practised by the Companions themselves. It may be mentioned that there were some big landowners in Madinah whose land was either neglected or under utilized. The owners, because of their affluence or otherwise, did not bother either to cultivate it themselves or to put it to proper use. To such people the Holy Prophet (peace be upon him) advised that they should give away their land to those who could use it for the benefit of the society and to generate economic and productive activity out of it. A number of such Ahadith in which such advice was given by the Holy Prophet (peace be upon him) have been reported by Imam Muslim and other compilers of the Ahadith. Such Ahadiths were always considered by the Companions as motivations and moral recommendations because nowhere the Prophet (peace be upon him) forcefully took away from anyone any unutilized land owned by him. During the recent decades mostly under the spell of communism, these Ahadith were interpreted by some writers to mean the abolition of private ownership of land or to prohibit the system of crop? sharing. Dr. Muhammad Yusufuddin has discussed this question in detail in his masterly work titled 'Islam ke Muashi Nazariyyea' (Karachi 1984, pp.328‑‑350). He has discussed the economic implications of the modes prohibited by the Holy Prophet (peace be upon him) and has given also the details of crop‑sharing system during the days of the Prophet (peace be upon him) and during the period of his immediate successors. In the light of this brief discussion on crop‑sharing it becomes clear that it is only a kind of agricultural Mudarabah and is allowed in Islam. The conclusions drawn by late Mr. Justice Qadeeruddin Ahmed are unfounded and without any valid argument.
Another scholar whose views were quoted before us is late Dr. Fazlur Rahman. It was said that Dr. Fazlur Rahman was known for his opinion of considering bank interest to be different from Riba and considered it to be allowed under Shariah. Dr. Fazlur Rahman was a profound scholar of Muslim philosophy and had served as Director of the Central Institute of Islamic Research, then situated in Karachi. He had written an article on Riba and Interest in 1963 which had created a stir in the academic circles of the country. His was considered to be the first strong voice in favour of holding that bank interest was not the Riba prohibited by the Qur'an. His views endorsed the views earlier expressed by Maulana Muhammad Ja'far Shah Phulwarwi and Syed Yaqub Shah. The arguments advanced by the latter two are, by and large, a paraphrasing of the arguments found in the said article of Dr. Fazlur Rahman. Dr. Fazfur Rahman has developed his thesis on the assertion that the Riba of the Qur'an is totally different from the Riba of the Hadith. Thus, he adopts a wrong line of argument from the very beginning by considering different terms used for the convenience of discussion and facility of understanding by some jurists to be the basis of a distinction in the nature and substance of Riba. After making a survey of the relevant Qur'anic verses and the order in which these were revealed, the author tries to explain the meaning of the Riba in the light of the established maxim that or one part of the Qur'an explains another. On the basis of .the relevant Qur'anic verses, interpreted in the light of each other, the author concludes that:‑‑
(i) The Riba of the pre‑Islamic days was a system whereby the principal sum was doubled and redoubled through a usurious process;
(ii)??????? because of this process of doubling and redoubling the principal, the Qur'an refused to admit that Riba was a kind of fair business transaction; and
(iii)?????? while permitting the commercial profit, the Qur'an encouraged the spirit of cooperation as opposed to that of profiteering.
Dr. Fazlur Rahman contends that the historical evidence possessed by him corroborates his conclusions. In support of his contention he selects the tradition recorded in the Muwatta of Imam Malik on the authority of Zaid ibn Aslam which is as follows: "In the pre‑Islamic days Riba operated in this manner: if a man owed another a debt at the time of its maturity the creditor would ask the debtor: will you pay up or will you increase? If the latter paid up, the creditor received back the sum; otherwise the principal was increased on the stipulation of a further term". It is significant to note here that Dr. Fazlur Rahman does not agree with Maulana Abul A'la Maududi who, according to Dr. Fazlur Rahman, assumed that for the first term the credit was granted free of interest. Disagreeing with this view he says "one fails to understand how this is intelligible in a social set‑up such as the commercial Makkahn society or the Jewish Medinise society, where the Riba system was quite normal. How could the usurers, who were keen in doubling and redoubling their capital forego the initial interest by way of charity, so to say". This comment shows that Dr. Fazlur Rahman agreed that the initial increase was also interest and that the usurers would not forego it.
However, Dr. Fazlur Rahman, following the line of Rashid Rida, contends that since the initial increase or interest in itself was not usurious it was not disallowed and cannot, therefore, be considered Riba. In reaching this conclusion he relies on the report of Zaid ibn Aslam quoted above. As pointed out earlier, the report of Zaid ibn Aslam does not make even the slightest hint that the first and the initial increase was not to be treated as Riba and only the second, third or other subsequent increases were meant to be prohibited. Apart from being logically unsustainable, this contention is contrary to the express Qur'anic Injunction which allows only the repayment of Ra's al Mal, i.e. the capital or the principal sum. Under no logic or linguistic interpretation or through any stretch, of imagination the first increase can be legitimately included in the principal sum and the subsequent increase excluded. Either each and every increase is to be treated as part of the principal sum allowing thereby all increases even what is considered to be usury at exorbitant rates doubling and redoubling the principal amount as something pure and permissible, or each and every increase irrespective of the rate, amount or order in which it was demanded is to be included in the definition of Riba and to be prohibited. This contention of Dr. Fazlur Rahman also contradicts his own views about the chronological order in which the verses relating to Riba were revealed. According to him, verse 39 of Chapter 30 of the Qur'an was the first statement of the Qur'an about Riba. This verse which passes a moral stricture on Riba was revealed in Makkah in the 4th year of Prophetic mission. The learned scholar rightly points out that it is not at all surprising that Riba is condemned in so early a revelation; rather, the absence of such early condemnation could have not only been surprising but also contrary to the wisdom of the Qur'an. The Makkahn verses of the Qur'an arc replete with the denunciation of the economic injustices of contemporary Makkahn society, the profiteering and stinginess of the rich and their unethical commercial practices such as cheating in the weight and measurements etc., how is it possible then that the Qur'an would have failed to condemn an economic evil such as Riba, However, here it passes only a moral stricture on Riba. it does not yet declare it legally prohibited, for Islam had not yet attained political power by which it could eradicate this evil. Dr. Fazlur Rahman goes on to say that when Islam became politically dominant after the Prophet's (p.b.u.h.) migration to Madinah, Riba was categorically prohibited in the following words of the Madinise Surah Al‑i‑Imran: "O ye who believe, do not consume Riba with continued redoubling and protect yourselves from Allah, per chance you may be blissful" [Qur'an III: 130].
This shows that, even according to Dr. Fazlur Rahman, the prohibition of compound interest was revealed soon after the migration of the Prophet (p.b.u.h.) to Madina where Islam had become politically dominant. This prohibition was later reasserted in very emphatic terms in a series of revelations which were revealed in three or four instalments. As has been discussed elsewhere, the Qur'anic verses 275‑276 of Al‑Baqarah reasserted the prohibition of every kind of Riba. In these verses Ribs has been mentioned in juxtaposition to trading which was declared to be lawful. It is significant to note that the mention of the permissibility of trading in this verse precedes the prohibition of Riba. which fact signifies that the alternative of Riba is trading and Allah's hook has already identified the alternative to Riba even before totally and fully prohibiting it. This juxtaposition of Riba and Trading excludes all discussion about the compound or simple rate of interest because both kinds of interest fall outside the purview of trade. However, the learned scholar's contention missed this clear and significant message of this verse and he concluded that Riba of the pre‑Islamic days was a system whereby the principal sum was doubled and 1'edoubled through a usurious process and because of this process of doubling and redoubling the principal amount, the Qur'an refused to admit that Riba was a kind of fair business transaction. Without prejudice to our discussion on the real meaning, of the term 'doubling and redoubling' to the context of Qur'anic diction and style, the very simple statement that Allah has prohibited Riba takes away the force of the arguments, if any. It is strange that, on the one hand, the learned scholar admits that the revelations regarding the prohibition of Riba came gradually and through a series of Qur'anic verses whose chronology has been determined by himself; on the other hand, he overlooks the fact that the qualified statement of verse 130 of Al‑i‑Imran has been followed by an unqualified and generalized prohibition in verses 275 ‑276 of Al‑Baqarah. If the chronology determined by the late scholar is correct, as it undoubtedly is, then the earlier revelation will have to be interpreted in the light of the later revelation under the principal acknowledged by the late scholar as well that one part of the Qur'an explains another. In support of his contention, Dr. Fazlur Rahman has concluded that the Riba prohibited by the Qur'an was only that which has been explained in the well‑known tradition recorded in Muwatta of Imam Malik, reported on the authority of Zaid ibn Aslam according to which the Riba during the pre? Islamic days operated in this manner: if a man owed another person a debt, at the time of its maturity the creditor would ask the debtor will you pay up will you increase'? If the latter paid up, the creditor received back the sum; otherwise the principal was increased on the stipulation of a further term". As mentioned above, the author insists that even the first term of the credit was not granted free of interest and considers it unintelligible in a social set‑up such as the commercial Makkahn society or the Jewish society of Madinah where Riba was quite normal to presume that for the first term the credit was granted free of interest. This being the situation there arises no question of restricting the prohibition of Riba to what Dr. Rahman considers the doubling and redoubling rate. The Qur'anic injunction that you can receive back only your principal sum clarifies that even the simplest form of Riba and the lowest rate of interest was prohibited as it involved $ increase on Ra's al‑Mal or the principal sum. There is strong evidence in the early Islamic literature, some of which has been quoted by Dr. Fazlur Rahman himself which negates his contention. For example, he has quoted another statement of Zaid ibn Aslam showing that the Riba of pre‑Islamic days consisted in its doubling and redoubling in terms of cash in the case of barter of money and age in the case of barter of cattle. This simply shows that in the repayment of a cattle bigger in age than what had been initially taken there was no question of any doubling or redoubling. This is a case of simple Riba or increase over and above the principal amount payable. The force of the historical evidence has indeed been testified by Dr. Fazlur Rahman himself who concedes that in fact all interest has been abolished by the Riba Ordinance of the Qur'an. Contrary to his earlier contentions Dr. Fazlur Rahman admits at the end of his article that the capital was not doubled or redoubled in each and every given case of loan and that it remained within a great deal of variation in individual cases depending on the circumstances such as the nature. of investment, the amount of risk etc. The author of the article concedes that since all these individual cases were part of one Riba system in whose nature it was to be so exorbitantly usurious that it had to be banned. It was the system as a whole which was abolished by the Qur'an and hence no exception could be made in individual cases.
When the entire system was banned, the milder cases were also naturally abolished since the system itself was tyrannical. On the basis of this last hypothesis the author tries to conclude that the bank interest of today should not be condemned. It is not possible to agree to this view which is based only on mere conjecture. The Qur'an has never differentiated between the milder or harder forms of Riba. It has prohibited Riba or Al‑Riba which includes all forms whether harder or milder. The Prophet (p.b.u.h.) has equated one Dirham by way of Riba to be as bad and heinous as the commission of adultery. There can be no two opinions that one Dirham increase can neither be considered exorbitant or exploitative by any stretch of imagination. Therefore, the express prohibition of one Dirham indicates that the Holy Prophet (peace be upon him) places the so‑called milder interest at par‑with the so‑called harder one.
Dr. Fazlur Rahman has also discussed the well‑known tradition attributed to Caliph Umar in which he has been alleged to have said that the last verse of the Qur'an to be sent down was the one prohibiting Riba but the Messenger of Allah (p.b.u.h.) passed away without having expounded it to us: so leave aside Riba and Reebah i.e. whatever is doubtful. After having relevant reports on the subject of the last revelation examined, the author has refuted the report attributed to Caliph Umar, because this as well as the other such reports prevent the correct appreciation of the nature of Riha prohibited by the Qur?an. It means that Dr. Fazlur Rahman does not agree with.the opinion that there are gray areas in the prohibition of Riba where a confusion or difference of opinion may arise. The paper also deals with the question of Riba al‑Nasiah and Riba al‑Fadl, the two well‑known categories of Riba discussed elsewhere in this judgment. In this context reference has also been made to the question of crop‑sharing which is not directly relevant to the subject of bank interest. The author has quoted a host of early Islamic authorities on the definition of Riba. But, strangely enough, he disagrees with almost all of them by claiming that Riba is only that exorbitant increment whereby the capital sum is doubled several‑fold against the fixed extension of term of payment of the debt. It seems that the underlying purpose of confining Riba only to exorbitant rate is 'to legitimize bank interest and interest rate prevalent in the present day economy. He seems to be in agreement with the upholders of the legitimacy of interest who claim that if the rate of interest i‑e. the price of loaning money is reduced to zero one would be faced with a limited supply of money against infinite demand and that, in such a situation, it would become impossible to control the rationing of the credit available, The author also agrees with the western economists in their claim that the rate of interest occupies the same place as price and performs the all important function that any price mechanism performs, namely, regulating the supply and demand of credit and rationing it among the consumers. To him, the rate of interest functions as an objective standard for allocating the credit and determining the real need for a loan. He dismisses the belief that the interest rate is arbitrary as absolutely groundless. However, it is again strange that after going through a long discussion on the justification of bank interest, it seems that the author considers bank interest and the banking system as a whole to be something alien to the spirit of Qur'an. He admits that the system of economy which the Qur'an requires us to establish is based on the spirit of cooperation for which a total reconstruction of the society is needed in accordance with the teachings of the Qur'an. Once this objective is achieved it "would make bank interest and the present banking system quite superfluous which is just what is the spirit of the Qur'an and the Sunnah requires of us. As long as our society has not been reconstructed on the Islamic pattern outlined above, it would be suicidal for the economic welfare of the society and the financial system of the country and would also be contrary to the spirit and intention, of the Qur'an and Sunnah to abolish bank interest. In accordance with the principle of Tadrij or "graduation" and "the easing of the way", it would be necessary to enact legislation against such grave social inequities as feudalism and hoarding, etc. before proceeding to abolish bank interest. It would be necessary for every citizen of Pakistan to work arduously and with an untiring zeal to reach the desirable goal of reducing bank interest to the zero point, in other words, to eliminate it completely. For this end, it would be necessary to increase the volume of real wealth and credit capital in the country to such a point that an equality or near equality comes to exist between the supply and demand of money in credit, and credit becomes very easy. In such ideal circumstances the motive for bank interest, and indeed, the profiteering motive may become extinct".
These last remarks of the late scholar show quite clearly that he himself was not convinced that his conclusions about the permissibility of bank interest were in conformity with the spirit of the Qur'an. Otherwise, there was no question of bank interest being rendered superfluous in the wake of the establishment of the economic system of Islam.
We may now examine the views of Dr. Muhammad Sayyid Tantawi, the Grand Shaikh of al‑Azhar as contained in his Arabic book on Interest and Banking Practices. Apart from going through the book of the Grand Shaikh, we have also benefited from a summary containing his views made available to us through the good offices of the Embassy of Egypt in Islamabad. Here is the summary of his views:‑‑
"Dr. Tantawi has made it clear at the very outset that his views on current bank interest and prevalent banking practices are his personal views based on his own understanding of the Injunctions of Shariah though in some respects these views were held by some earlier scholars of al‑Azhar as well. Secondly, as Dr. Tantawi himself admits, his views are based on the situation prevailing in Egyptian society and the practice of the Egyptian banks. In the process of formulating his views, Dr. Tantawi benefited from the advice and expert opinion made available to him by a group of 'Egyptian economists and bankers. A number of factors led him to study and keep in touch with the problems pertaining to the bank interest and other banking practices. The most important one is that irrespective of their size‑ the banks are working as financial institutions which circulate wealth and distribute profit. In addition, people have to enter into financial dealings in various forms, on which the Shariah does not place any restrictions. Shaikh Tantawi tries to develop some rules which, in his opinion, should not be transgressed and violated in the course of trade and business. According to him, all such commercial dealings are permitted in Shariah which are free from cheating, deception, greed and such other vices as these are prohibited by Allah. Likewise, any trade, business dealing or banking operation which involves any of these evils is prohibited. With these two basic principles in view, the study of the banking operations was undertaken with reference to Egyptian banks and opinion was expressed concerning each one separately. Before discussing the details of the banking practices he clarifies his views concerning "interest". He admits that Riba has been expressly prohibited by the Holy Qur'an and Sunnah as is unanimously held by the jurists of Islam. He says: "No two people differ that `interest' (sic) is one of the gravest vices prohibited by all revealed religions. All people hold this view. In fact, if a Muslim objects to this prohibition of Islam, he thereby defies a matter which is of necessity known to be a tenet of Islam and by this he will be crossing the boundaries of Islam. This shows that the difference of opinion between Dr. Tantawi and other jurists is not about any Injunction of Islam with regard to interest, This difference of opinion is, about the bank interest and the extent to which it is actually Riba. Such difference about the details one also finds in the writings of jurists of Islam of earlier period.
According to Dr. Tantawi, interest has been defined by the jurists in a number of ways but he has chosen the following definition: "It is the increase over and above the capital not in exchange for a lawful compensation". The interest which is prohibited is the one which was known as Riba al‑Nasiah referred to in the Holy Qur'an. This is the interest which increases with the passage of time. The Sunnah has also stated that interest is one in which the increase or ,surplus is reserved for a particular party to a contract without anything in exchange. For example, a man gives a loan of a 100 pounds to another but expect‑, 120 pounds in return Two kinds of dealings fit the above example in the present age :
Firstly, what some construction firms do when they sell a building for 10000 pounds ‑ for instance ‑ and the buyer has to pay 1000 pounds in advance and the rest he pays in instalments with a certain profit or increase annually. This profit or increase is interest.
Secondly, What the richer states do when they give a loan to a poverty‑stricken country which needs that money to fulfil its basic needs: a heavy interest is incurred on the actual sum making repayment an uphill task. This interest is also Riba.
Before proceeding to discuss bank dealings, Shaikh Tantawi defines four terms which he finds relevant to the discussion on bank dealings. These terms are:
(1)??????? Qurud (loans), plural of Qard or loan.
(2)??????? Duyun (debts), plural of Dayn or debt.
(3)??????? Deposits.
(4)??????? Investment.
Qurud is more particular than Duyun as it is that loan which a person gives to another as a help, charity or advance for a certain time. Duyun are those amounts or payments that one has in his liability but it does not belong to him. A Dayn is incurred either by way of rent or sale or purchase or in any other way which leaves it as a debt to another. Duyun (debts) ought to be returned without any profit since they are advanced to help the needy and meet their demands and, therefore, the lender should not impose on the borrower more than what he had lent. But if borrower volunteers to give something extra out of his own free choice to the lender then he is free to do so. Deposit is that amount of money or goods which one leaves with another person to preserve it for him as a trust and whenever he demands it back, it ought to be returned. All the jurists agree that the man who keeps the deposit has the right to ask for something in return as it might have engaged his efforts and money. Investment means making up wealth just as a farmer makes up his cultivation to get more production. It also means an endeavour to enhance wealth through various means and methods which conform to Allah's Injunctions. Each of these terms refers to an activity which has its own principles and rules in Shariah to regulate it. The main consideration taken into account is the meaning and objective and not merely the words. Whenever words are misused mistake has to occur about the legal position of the transaction. In view of this discussion, Shaikh Tantawi classifies the practices, operations and functions of a bank into two main kinds:
(1) ?????? Services.
(2)??????? Investment.
The most essential services include: salaries of workers and the funds they earn after retirement, arrangement for the transfer of money from one place to another, issuance and circulation of . currency. preserving valuable deposits and guaranteeing its safe hand over when demanded according to the system agreed upon by the hank and the depositors. In addition to these, there are other services offered by some social banks like granting easy‑term loans to students, the needy and workers. For instance, Nasir Social Bank (of Egypt) offers these services. All these services are quite laudable and there is nothing wrong if the bank charges something in exchange for these services as service charges. In fact, all revealed religions encouraged these services as they cater for the welfare of a person. The second function of the bank is that of investment which means taking measures leading to the growth of wealth through profit permitted by Allah. It is for this very reason that trading companies and investment banks are established. Investment of surplus money, which is the main source of financiers and funds available to a bank, may be done in various ways:
(1)??????? Sharing which means that the bank shares with someone in enhancing its wealth according to agreed terms. The Islamic Shariah permits all this so long as it is free from cheating, embezzlement and untrustworthiness. A number of banks have invested their wealth and are sharing profit with others. The National Bank of Egypt has its shares with 64 firms which deal with agricultural, industrial and social enterprises.
(2)??????? Murabahah, which literally means mutual profit is defined as the resale of a commodity with an agreed ratio of profit. An example of this is that the seller (in this case the bank or any finance company) says that I bought a certain item for this much and will sell it with this much profit and the buyer buys it after fully satisfying himself about the original value of the commodity. Nasir Social Bank invests a part of its wealth by Murabahah.
(3)??????? Mudarabah.‑‑‑It means that a man who has wealth but lacks expertise and skill offers his money to one who lacks the wealth but is an entrepreneur or an expert. The money is invested with the condition that the profit will be distributed according to the agreed ratio which should be in terms of a known percentage. This dealing was practised before Islam and was endorsed by Islam under a set of rules and conditions to systemize and regularize it.
The most important condition for this kind of a dealing to become lawful, according to Islamic law, is that the percentage of the profit should be known, beforehand to both the parties, such as half, a third or a fourth. But if a certain amount of money is fixed and predetermined beforehand, this dealing loses its validity. But Shaikh Tantawi here prefers the view of some modern jurists like Abdul Wahhab Khallaf who say that there is no argument in the Qur'an and Sunnah for this last‑mentioned condition. Mudarabah is validated according to the terms agreed upon by both the parties especially these days when there is no mutual trust. If this kind of dealing is nullified owing to the absence of a certain condition, the entrepreneur should be treated like a hired worker or an employee who works and receives his remuneration in return of his labour and in this wav both parties receive the benefit. Allah has not prohibited anything which reaps benefit for the people. The opinion of Shaikh Tantawi of permitting the fixation of a predetermined amount beforehand is based on nine arguments presented by him in the book. Moreover, he agrees with Khallafs view on Mudarabah and considers it applicable to those who keep their wealth in banks and get a fixed profit out of its proceeds. The amount of profit may be fixed keeping in view the amount of the capital. The arguments given by Shaikh Tantawi may be summarized as follows:
(1)??????? Fixing the profit beforehand is not a matter of creed or worship so that it cannot be altered. Rather, it is a financial dealing which is based upon the agreement of the parties to the contract. His argument is the Qur'anic verse: "O ye who believe, devour not your property among yourselves vainly, unless it be a merchandise by mutual consent????.." (al‑Nisa: 29). This means that it does not befit a believer to devour the wealth of another through unlawful means.
(2)??????? Islamic Shariah is based on the principle of Maslahah or caring for the peoples' welfare for all times and places. This gives the authority to Government to take steps to ensure the welfare of the people. This may apparently go against the express text of some Ahadith where the Prophet (peace be upon him) disallowed price fixing but a great many jurists allow it especially if the traders raise prices of commodities to exorbitant rates. So if the jurists considered the peoples' welfare and did not abide by the express injunction even in its presence, then it is all the more befitting that fixing the profit, especially when it is in the interest of the people. should be allowed particularly when there is no express injunction on the matter. The maximum that can be said is that those who disallow this dealing do it on the basis of their own Ijtihad and analogical reasoning. They compare the contract of Mudarabah with the contract of Muzara'ah or crop‑sharing.
(3)??????? There is no Islamic Injunction which prohibits any party to a contract of Mudarabah from fixing the profit in advance so long as it is agreed amicably by both the sides. Accordingly, there is nothing wrong if the bank where money is deposited for investment fixes the profit and uses the money for lawful investment.
(4)??????? The banks always fix the profit in advance after carefully studying the international and national markets and the economic conditions of the society. Moreover, the Central Bank regulates the fixation of these profits.
(5)??????? Fixing the profit brings benefit for both the investor/saver and the entrepreneur.
(6)??????? Fixing the profit in advance does not contradict the possibility of a loss on the part of the investor, whether a bank or individual. This is because if there is loss on one ground in a trade, one may gain on another ground. If the loss occurred due to external factors, the investor ought to shoulder the burden as a necessary consequence. This is decided by those responsible in this regard. This condition can also be mentioned in the contract. As for losses due to mishandling or bad administration they do not fall under this category and may not be discussed here.
(7)??????? Non‑fixation of a particular amount as profit in these days when dishonesty and mistrust are the order of the day may put the owner of wealth at the mercy of the entrepreneur who might not be honest.
(8)??????? Another reason is that there is a rule in some factories that if there is any loss at the hands of a worker, he should be made responsible for it. The same losses can be shouldered by bank deposits for which the saver has the right to ask for steps to save and protect his capital. The Shariah does not mention any particular requirement in this regard but since they are for the welfare of the people they can be categorized under al‑Masalih al‑Mursalah.
(9)??????? Even if fixing the profit impairs the contract of Mudarabah, none of the jurists said that this condition turns it into an interest‑based contract. Rather, they all agree that the entrepreneur becomes like a hired worker who will get his remuneration according to the market rate (or Ajr Mithl). The investor may take whatever remains of the profit. The position of the bank here, according to Dr. Tantawi, is like a hired worker for those who deposit their money in it and are satisfied with the profit they receive. In this way, this dealing will not be that of interest. Although it is true only through a Qiyas, because according to the jurists in a Mudarabah which is impaired the worker's share is fixed and not the share of the investor."
Dr. Tantawi, thus, holds that bank dealings are allowed not only because they fall under Musharakah, Murabahah and Mudarabah, but also because, there are other forms of dealings as well which Allah has permitted. According to him, all bank dealings of investment are permissible. The bank exercises the power of attorney or legal representative. This is seen by him to be exactly in accordance with the Islamic framework. His view is manifest and clear: the saver assigns the bank and delegates to it total power of representation to invest his wealth in things permitted by Allah. The saver should be satisfied with the profit that the bank offers. .
The Shaikh's views can be summarized as follows: Fixation or non? fixation of the profit in bank dealings does not have any impact on the lawfulness or unlawfulness off the dealing as long as both the parties agree upon and as long as all dealings are done without any cheating, lie, deception, oppression or interest or anything which Allah has prohibited. One is, therefore, free to deal with banks whether they fix the profit or not. But it should be kept in mind that the standard requirement is that all dealings should be made free from the evils mentioned above. The Shaikh finally gives preference to the dealings which fix the profit saying that it is closer to the spirit of Islam as it clearly defines the rights of the parties and what they deserve. Added to this is the Saikh's opinion concerning "Certificate of Investment" about which he says that it is permissible and so are the profits coming therefrom as long as the saver agrees to give full authority to the bank to invest his wealth where it wishes and be satisfied with the profit he receives whether monthly or otherwise.
The gist of this discussion is that Dr. Tantawi does not consider the present bank interest to be Riba. He treats it to be like the profit of a Mudaraba or Murabahah. However, on a closer examination the argument advanced by the Egyption Shaikh loses ground. Even if this logic is accepted for the sake of argument that the bank interest is like profit and it can apply only to the profit paid by the bank to the depositors. But it does not apply to the interest charged by the banks from the borrowers. Dr. Tantawi has not discussed this aspect of the operation in his book which deals only with one side of the coin. What the banks do with the savers money, how they lend it out and under what conditions and arrangements they charge interest? These questions have been ignored by the learned scholar. Unless these important questions are properly answered his arguments will remain incomplete. The learned Shaikh has missed the important fact that it is the lendings of the Bank which is the major factor and not the deposits it receives. It may be pointed out here that Shaikh Tantawi does not claim any direct knowledge, not to speak of any expertise about modern banking system. He has clearly and repeatedly said that his opinion is based on the understanding of the banking operations given to him by a group of bankers. However, it may also be noted that there was great uproar in the academic circles of Egypt when the book was published. Even the concerned bodies of Al‑Azhar are said to have disowned the views expressed in the book. This is in addition to a number of rejoinders coming front many Egyptian scholars in refutation of the views of Shaikh Tantawi.
The most powerful and academically most sound rejoinder came from Dr. Yusuf al‑Qaradawi, a renowned jurist from Egypt itself.
The most important question raised by some scholars which also finds its echo in the writings of Dr. Fazlur Rahman, Justice Qadeeruddin Ahmed and Dr. Shaikh Muhammad Sayyid Tantawi is that of any possible difference between consumption loans and production loans. It is vehemently argued by these writers that while determining whether any increase on a loan is Riba or not, the question of the purpose of the loan has to be kept into consideration. According to this opinion, a loan taken for commercial purposes should be considered different from the one taken for the purpose of personal use. While a demand to pay more over and above the principal amount of a loan taken for personal consumption is Riba, it is asserted that no justification is found to include the increase on loans taken for commercial acid investment purposes in the category of Riba. The upholders of this view mainly rely on the arguments contained in the writings of Maulana Jaafar Shah Phulwarwi and Mr. Yaqoob Shah, both published by the Institute of Islamic Culture, Lahore. We shall shortly examine this contention. During his submissions before this Court as well as before the learned Federal Shariat Court, Mr. Khalid M. Ishaque also advocated this point of view. He relied on the writings of a contemporary Lebanese author, Dr. Nabil A. Saleh and American Jewish author Dr. Abraham L. Udovitch. Mr. Khalid M. Ishaque also provided to us photo copies of the scholarly books of these authors.
Dr. Nabil A. Saleh in his book Unlawful Gain and Legitimate Profit in Islamic Law: Riba, Gharar and Islamic Banking has examined the concept of Riba and its application to the financial system developed by the Muslims both in the past and in the contemporary Muslim World. As a balanced and judicious author, he has tried to discuss all possible aspects of the question of Riba as discussed in Muslim history and has referred to different views on the subject. The difference between Riba al‑Nasi'ah and Riba at‑Fadl has also been discussed by the author. While he faithfully records that there is no doubt that the majority of Muslim scholars and modern men have interpreted and continue to place a wide‑range interpretation on the prohibition of Riba. A few of them have endeavoured to confine such prohibition within more restricted limits. The learned author has noted that since these few scholars and men of learning include some most eminent scholars, their views carry some weight and deserve to be reported. It is clear from his treatment of the views of this minority group that he is reporting them because they deserve to be taken notice of in view of the eminence of their upholders. The author's own findings on the basis of which his entire book has been developed are exactly the same as held by the overwhelming majority. The author also records? that each of these minority views has been the subject of incessant discussion and, of course, harsh criticism. The personalities to whom this minority 'view is attributed are the well known companion of the Prophet (peace be upon him) and his cousin Abdullah ibn Abbas, the renowned jurists and thinkers of the 14th Century C.E. and a Hanbali theologian Ibn Qayyim al?Jawziyyah, the renowned Egyptian scholar and leader of modern renaissance Mufti Muhammad Abduhu, his celebrated disciple Sayyid Rashid Rida, the renowned modern Egyptian jurist Abd al‑Razzaq Sanhuri, the contemporary Syrian scholar and statesman Dr. Maroof Daoualibi, the well known Egyptian jurist Shaikh Abdullah Draz and one Mr. Zaydan Abu al‑Karim Hassan.
Let us discuss the views attributed to these luminaries. It has been reported in some earlier writings of the subject that Hazrat Abdullah ibn Abbas was initially of the view that the only Riba which was declared unlawful by the Prophet of Islam was the Riba al‑Jahiliyyah as was practised by the Arabs before Islam. It has been attributed to Hazrat Abdullah ibn Abbas that he did not consider Riba al‑Fadl to be the Riba prohibited by the Prophet (peace be upon'him). It is contended by the author and also endorsed by Mr. Khalid M. Ishaque that Abdullah ibn Abbas held a liberal view of Riba and relied on a Hadith reported by himself which, in his opinion, as understood by Dr. Nabil Saleh and Mr. Khalid M. Ishaque, superseded the Ahadith about Riba al‑Fadl. These Ahadith being the last ruling of the Prophet (peace be upon him) on the subject of Riba say: "No Riba except in the Nasi'ah". The author also records the interpretation given to this Hadith by the upholders of the majority view who see it as putting more emphasis on Ribd al‑Nasi'ah and not .as superseding the earlier Ahadith. The author also acknowledges that there are reports that Abdullah ibn Abbas had later reviewed his earlier interpretation.
The question of the views of Abdullah ibn Abbas about Riba al-?Fadl had been the subject of long discussions in the academic and juristic circles throughout Islamic history. Almost all the major writers on the subject have dealt with this question. There is almost a consensus that Abdullah ibn Abbas had retracted on his earlier views and had adopted the majority view that both kinds of Riba (Riba al‑Nasi'ah and Riba al‑Fadl) were prohibited in Islam. We shall refer to these findings of the renowned writers on the subject separately. However, even if it is conceded that Ibn Abbas continued to stick to his original interpretation and continued to exclude Riba al‑Fadl from the Qur'anic prohibition of Riba, it will serve no purpose as far as the question of bank interest is concerned. The transactions of the banks can in no way be considered to be in the nature of barter sales and hence, subject to Riba al‑Fadl. As we have already pointed out, Riba al ?Nasi 'ah means increase on the principal amount in a deferred payment, as the word Nasi'ah (deferred payment or deferment) clearly and unequivocally shows.
Ibn Qayyim al‑Jawziyyah had dealt with the subject of Riba in his juristic chef d'ouvre, I'lam al‑Muwaqqi'in, basically with a purpose to highlight the rationale of the prohibition of Riba and the juristic principles which regulate this prohibition and demarcate its limits. In this context, Ibn Qayyim has tried to differentiate two kinds of Riba from each other. The Riba par excellence was to be distinguished for facility of understanding and argument from the Riba by way of extended meaning. For the first category he uses the term manifest Riba showing thereby that this is the Riba which is expressly and manifestly prohibited by the Qur'an. On the other hand, he calls Riba al‑Fadl as Hidden Riba prohibited by the Prophet (peace be upon him) under the principle of Sadd al‑Dhariah or preventive measures. Dr. Nabil Saleh has given a faithful summary of the views of Ibn Qayyim which may profitably be quoted here:‑‑‑
"In one of his treatises, Ibn Qayyim differentiates between "hidden Riba" (Riba khafi) and "manifest Riba" (Riba jah). Manifest Riba is Riba by way of deferment (Riba al‑Nasi'ah) and hidden Riba is Riba by way of increase (Riba al‑Fade. Hidden Riba is not forbidden in itself but only when it is a way to gain manifest Riba, which is forbidden in itself. Because of such a distinction, Ibn Qayyim saw that the degree of prohibition was not the same in both categories: it was much stronger in manifest Riba or Riba al?Nasi'ah than in hidden Riba or. Riba al‑Fadl. As a consequence, manifest Riba (Riba al‑Nasi'ah) cannot become lawful except in the case of pressing necessity (darura mulji'a), like that which allows the eating of carrion. On the contrary, hidden Riba (Riba al‑Fadl) can become lawful in case of need (haja) only, which is obviously governed by less stringent conditions than "pressing necessity". In other words, Riba al‑Fadl or hidden Riba is a "gray area". it is prohibited when there is a fear that it may be allowed in case of need". [Page 27: Unlawful Gain and Legitimate Profit in Islamic Law, Cambridge University Press, 1986 (Quoting Flam‑al?Mawaqqrin, Vol‑II, p.154ff)].
These views of Ibn Qayyim leave no doubt that Ri ba al‑Nasi'ah is manifestly and emphatically prohibited by Islam. As such, there W is no difference between the views of Ibn Qayyim and the views of the overwhelming majority of Muslim jurists. The plea that Ibn Qayyim's views support the contention that bank interest is not Riba is not substantiated by the writing of Ibn Qayyim himself or even by the summary of his views given by the Labanese author. To this extent, the contentions of Mr. Khalid M. Ishaque are unfounded.
Mufti Muhammad Abduhu and.Sayyid Muhammad Rashid Rida have been referred to by Mr. Khalid M. Ishaque in support of his submissions to the effect that bank interest was not prohibited under the principles of Islam. We have already discussed the views of Sayyid Rashid Rida as contained in his own booklet on the subject of usury and bank dealings in Islam. Let us now take up the view of Mufti Muhammad Abduhu as reported by Dr. Nabil Saleh. According to his summary of the views of Mufti Muhammad Abduhu, the Riba disallowed is only the Riba al? Jahiliyyah (pre‑Islamic Riba) which is manifest (Jali) Riba and consequently is prohibited not as a way of leading to an usurious transaction but as an usurious transaction in itself. As for the two other sorts of Riba, namely (Riba al‑Fadl and Riba al‑Nasi `ah) both provided for in the Hadith and not in the Qur'an, their prohibition tends to close the loophole which otherwise might permit manifest Riba (Riba Jali). Thus, Riba al‑Fadl and Riba al? Nasi'ah are under a presumption of prohibition and this presumption is not conclusive but rebuttable. Thus, again the sale of any of the six articles mentioned in the Hadith, with an increase and whether in a hand‑to‑hand transaction or in a deferred one, is disallowed only if it is intended to lead to manifest Riba (Riba Jali), which takes place when interest accrues on interest already accounted by the time the transaction was concluded. The? net result of the views of Mufti Muhammad Abduhu as quoted by the author is that the first increase on the termed loan is lawful even though agreed in consideration of the delayed term of payment but if, at maturity date, it is decided to postpone that maturity date against a further increase, that is the unlawful Riba al‑Nasi'ah.
It is difficult to critically examine and assess the views of Mufti Muhammad Abduhu as to the basis of differentiation between the Riba al? Jahiliyyah and Riba al‑Nasi'ah. No original writings of Mufti Muhammad Abduhu have been quoted by Dr. Nabil Saleh nor identified by Mr. Khalid M. Ishaque. These views have been recorded by his disciple Sayyid Muhammad Rashid Rida in one of his Fatawas. Moreover, in the presence of such an overwhelming evidence and scholarly authorities which establish beyond any shadow of doubt that Riba al‑Jahiliyyah and Riba al‑Nasi'ah were identical and were always considered to be one and the same thing, it is not possible for any responsible student of Islamic Law to agree to the views of Mufti Muhammad Abduhu. If Riba al‑Nasi'ah? is not the Riba prohibited by the Qur'an then what is the Riba against which a declaration of war has been made by Allah and His Messenger? It is strange that Mr. Khalid M. Ishaque seems to uphold the views of Mufti Muhammad Abduhu and Sayyid Rashid Rida at the same time, while the former does not consider the Riba al‑Nasiah to be the Qur'anic Riba, the latter is clear on this point and concedes to the views of the majority. Again, the statement attributed to Abdullah??????????? ibn Abbas and heavily relied upon by all the defenders of the Bank interest also goes against the view attributed to Mufti Muhammad Abduhu.
An? attempt to find out whether the Riba in the Pre‑Islamic Arabia was paid on personal and consumption loans or on commercial and productive loans as well, was undertaken by the Institute of Islamic Culture, Lahore in late fifties and early sixties of this century. The Institute had published a book under the title "COMMERCIAL INTEREST KI FIKHI HAISIAT" which consisted of articles written mostly by Maulana Muhammad Jaafar. Shah Phulwarwi and Syed Yaqoob Shah, a former Auditor‑General of Pakistan. The latter had further elaborated his 'article and got it published as an independent book by the Institute of Islamic Culture itself. The arguments advanced by the learned contributors to this.book seek to prove that commercial interest was unknown to pre‑Islamic Arabia and that the Qur'anic prohibition of Riba is applicable only to the interest charged on personal and consumption loans. By claiming that pre‑Islamic Arabs were not aware of commercial and productive loans, the learned writers tried to establish that neither Bank interest nor the interest paid by the Government on loans received by it or the securities and certificates issued by it falls within the ambit of Riba prohibited by the Qur'an. Without going into the merits of this argument at this stage it has to be observed that the foundation on which the argument has been raised is very shaky and uncertain. The approach of the learned writers is not supported by valid arguments accepted for a historical inquiry. A historian may establish the existence of a practice or an institution at a certain stage of past history in the light of the available data and recorded evidence. But it is extremely difficult, if not at all impossible, to establish the absence or negate the existence of a practice or institution in the ancient history. Secondly, either the available data establishing not only the existence but general prevalence of commercial loans in pre‑Islamic Arabia was not known or available to the learned writers or they purposely chose to ignore it which seems to be the case in view of the internal evidence of their own writings. They have taken for granted as a basic postulate that commercial and productive loan is the invention of the western capitalism and that the institution of financiers and financial intermediaries was unknown to other civilization particularly the Arab‑Islamic civilization.
Before we take up the examination of the material relevant to the existence or otherwise of commercial loan in pre‑Islamic Arabia, we should be clear in our minds about the extension of the Qur'anic prohibition of Riba to such forms and practices of Riba which were not known to pre‑Islamic Arabs. Nowhere the Qur'an restricts the prohibition of Riba to the form or forms prevailing at that point of time in Arabia. It prohibits Riba with the definite article `al' which is used to denote all‑inclusiveness (Istighraq) which means that all forms and categories of Riba are prohibited as long as they fall within the description of Riba given by the Qur'an. Nowhere the Qur'an or the Sunnah of the Holy Prophet (peace be upon him) refer to the purpose or the object of loan as something relevant to the prohibition of Riba. The Qur'an declares each and every increase over the principal sum as Riba irrespective of the object or purpose for which the principal sum was borrowed. The exercise to find out whether the Arabs of pre‑Islamic Arabia were aware of productive and commercial loans is, therefore, merely an academic exercise. However, when examined carefully there is found an abundant fund of evidence to establish beyond any shadow of doubt that the Arabs were not only aware of the concept of commercial loans but also practised it at such a wide scale that almost the entire trade of the pre‑Islamic Arabs was mainly run on the basis of commercial loans taken on the payment of interest or Riba which was later prohibited by the Qur'an. Not only the express wording of the Qur'an in Verse No. 279 of Chapter II but also the commentators of the Qur'an, compilers and scholars of the Ahadith, the jurists and the lexicographers are unanimous and clear that Riba means any increase over and above the principal sum required to be paid in consideration of time. Some examples of how Riba was defined by earlier authorities have been quoted in the judgment of the learned Federal Shariat Court as well. Some of these may be reproduced here:
The word "interest", by and large, has now been accepted and is understood as Riba (See Stiengass
English ‑ Arabic Dictionary, Lahore 1979, the word 'interest'). Riba
Usury, as defined in A Dictionary of /slam' by Thomas Patrick Hughes, (Lahore, 1964, page 544) "Means "an excess according to a legal standard of measurement or weight, in one or two homogenous articles opposed to each other in a contract of exchange, and in which such, excess is stipulated as an obligatory condition on one of the parties without any return". The word Riba appears to have the same meaning as the Hebrew neshec, which included gain, whether from the loan of money or goods or property of any kind. In the Mosaic law, conditions of gain for the loan of money or goods were rigorously prohibitert
See Exold, xxii. 25; Lev. XXV. 36 (Usuri). Therefore, Riba includes both
'usury' and 'interest' as known in English terminology. In legal sense, it is that excess amount which a "Creditor" settles to receive/or recover from his "Debtor" in consideration of giving time to the said debtor for re‑payment of his loan. Imam Tabari (d. 310 AH) in Tafsir Tabari
(Vol. III, p.64) commenting on the Qur'anic verse (Baqarah: 275) writes that:
"Riba is that increase which the owner of money or the financier receives from his debtor for giving him time to repay his debt". Ibn al‑Athir, in his famous work Kitab al‑Nihayah fi‑Gharib al‑Hadith wa'l‑Athar, Cairo, 1322 AH. Vol. lI, p. 66 says: "The original meaning of Riba is excess and in the terminology or the Shariah, it means increase over and above the principal without any contact of sale having taken place". Ibn 'Arabi in his noted work, Ahkam al‑Qur'an, (Cairo, 1957, Vol. I, p. 242) has defined Riba to be the name of every increase in lieu of which there is no consideration. Allama Burhanuddin al? Marghinani (d. 593 AH) has defined Riba in his book, Al‑Hidayah as : "Riba, in law, signifies an increase in a (loan) contract in which such increase is stipulated as an obligatory condition on one of the parties, without any return, i.e. without any corresponding property (Mal), in exchange. (See also Book XIV on Sale, Chapter VIII on Riba or usury. Hidayah, English Translation by Hamilton, Lahore, p. 289). Imam Fakhr?
al‑Din Al‑Razi (d. 606 AH) in his well‑known Tafsir al‑Kabir writes that the meaning of the word Riba is increase but it does not mean that to recover every kind of increase is Riba and is unlawful. The forbiddance of
Riba relates to a special kind of contract which was known amongst the Arabs as
Riba al‑Nasiah i.e., increase on debt. (The other kind of Riba called
Riba al‑Fadl is, outside the scope of the present discussion). Allamah
Jassas in his Ahkam al‑Qur'an (Istanbul, 1335 AH. Vol. I, p. 469) defines the term Riba as the loan given for a specified period on the condition that on the expiry of the period, the borrower will repay it with some excess. Even in common law parlance "interest" has been held as the excess over and above the original advance paid to the creditor in consideration of the time allowed for repayment. The fact that it is not described in so many words as interest will not alter its‑character". (AIR 1944. Mad. 243).
Halsbury's Laws of England, (Para 106, Vol. 32, 4th Edition) defines interest as follows:
"Interest is the return or compensation for the use or retention by one person of a sum of money belonging to or owed to another .... "
These examples, taken from the impugned judgment of the learned Federal Shariat Court, .provide sufficient and ample evidence to establish that the purpose of loan is totally irrelevant in the context of the definition of Riba as the prohibition of the Qur'an extends to both the categories of Riba, namely interest charged on commercial loans and the interest charged on personal or consumption loans. Precedents of the pre‑Islamic and early Islamic Arabia also establish that the Arabian Riba did include excess paid in commercial and productive loans. The economic history of the city of Tayef, the habitat of the tribe of Thaqif, provides examples of different kinds of loans prevailing in pre‑Islamic Arabia as well as the kinds and modes of interest charged on such loans. As against the city of Makkah, the city of Tayef was known for its agricultural produce as well as industry and handicrafts in addition to trade and commerce. As reported by the historian al‑Baladhuri (Futuha al‑Buldan, Cairo 1932, page 67), there was a sizeable Jewish population in the city which also participated in the trade and business of the city. They, alongwith the members of the tribe of Thaqif, had organized their trade and commerce on the basis of interest. There were sections of the population which had specialized in Riba as recorded by the well‑known commentator of the Qur'an; Abu Hayyan al‑Andulasi in his well known commentary of the Qur'an known as al‑Bahr al‑Muhit (VoI.II, p.335). He also records that the tribe of Thaqif was in the forefront of all the Arab tribes in their involvement in interest. The traders and businessmen of Tayef not only provided money on interest to the people of their own city but also provided interest‑bearing loans to the traders and businessmen of Makkah. This interest was received both in cash as well as in kind. According to the earliest authorities (such as al‑Tabari, commentary of the Qur'an, Vol. IV, p.55), the tribe of Banu Mughirah, a branch of the tribe of Quresh of Makkah were regular and permanent clients of the traders of Thaqif and regularly received interest‑bearing loans from them. 1n fact, the interest‑bearing business of the people of Tayef prosperred mostly because of the Makkahn traders who received loans from Tayef. Makkah was neither an agricultural town nor there were goods and minerals nor any major industry. The main source of their affluence was trade and commerce for which they borrowed money on interest from others particularly from Tayef. It was because of this exceeding involvement of the people of Tavef in Rib, and interest that on their submission to the political authority of the Holy Prophet (peace be upon him) immediately after the conquest of Makkah in the 8th year of Hijrah the Holy Prophet (peace be upon him) expressly provided in the agreement of peace that they would stop all interest‑bearing transactions, would also give up their claims of Riba against others and would not pay others' claims involving Riba. This express provision of the Treaty of Peace with Thaqif as well as other non‑Muslims groups such as the Christians of Najran clearly and unequivocally lays down the principle that no Muslim or non‑Muslim citizens of the Islamic State is allowed to indulge in any Riba‑based 'transaction. It may be pointed out here that the meaning of the application of the term Riba had already been extended by the Holy Prophet (peace be upon him) to include what is known as Riba al?Fadl, Riba al‑Sunnah or Riba Khafi. This kind of Riba was prohibited much earlier than the conquest of Makkah and had become well‑known among the Muslims. The fact that the Prophet of Islam prohibited the non‑Muslims of Tayef from all Riba without restricting it to the pre‑Islamic mode or brand negates the argument of the learned counsel for the Federation that the non? Muslims in an Islamic State are allowed to practise Riba al‑Fadl.
When the Prophet (peace be upon him) left for Madinah after completing the conquest of Makkah and signing the Treaty of Peace with Tayef, there was a dispute between some traders from Makkah and Tayef about the payment of certain pre‑Islamic outstanding claims. It seems that the newly converted Muslims of Makkah were not clear about the extension and application of the prohibition of Riba to the outstanding claims of pre?Islamic days. Some of them thought that the prohibition of Riba was not retrospective and that they could still claim the outstanding amounts due on others. The dispute was referred to the Qadi of Makkah, Attab Ibn Usaid who was appointed by the Holy Prophet (peace be upon him) after the conquest of the city. The young Qadi dismissed the claim but on the insistence of the claimants he was forced to refer the matter to the Holy Prophet (peace be upon him) himself. Among the tribe of Thaqif four brothers were known for their interest‑based trade. They used to give loans on interest to Banu Mughirah. When the Holy Prophet conquered the city of Tayef, all the four brothers accepted Islam. They had some outstanding claims of interest payable by Banu Mughirah who now refused to pay interest and said that Islam had prohibited interest and, thus, they are no more liable to pay it. It was this dispute which was taken up to Attab ibn Usaid' the new Qadi of Makkah appointed by the Holy Prophet. Upon this the verses 278‑280 were revealed in which all the outstanding claims of Riba were abolished in very strong and emphatic terms and the creditors were allowed only to receive back their capital or the principal sum.
As pointed out earlier, the city of tayef was particularly famous for its commerce and trade on the basis of Riba. Most of the data available about Riba in pre‑Islamic Arabia relates to Tayef. According to historian al?Baladhuri (Futuh al‑Buldan, Leiden, p 56, Tayef), the people of Tayef were known for their usurious practices. The tribe of Thaqif, out of Tayfian tribes, was notorious in this practice which had become a profession for them. This usurious trade was not confined to Tayef; it was, rather, extended to Makkah. The Makkahn traders used to get loans from the Tayefians on interest which was paid both in cash and in kind. The tribe of Banu Mughirah? a rich sub‑tribe of Quresh tRibal group, used to get loans on interest from the Thaqifite traders. The main component of the deal was the extension of period .of repayment of the principal sum (see further details in the commentary of the Qur'an by Tabari under verse 130 of Al‑Imran). In the context of this discussion, Tabari reports that the mode of charging interest in pre‑Islamic Arabia by the tribe of Thaoif was that whenever they advanced loan to a debtor to be repaid after a fixed period they would tell the debtor at the time of the repayment: "Either pay the loan or increase the amount" If the debtor had money to pay he would pay. Otherwise, he would accept increase and get the period extended for one more year. Thus, if one year old camel was to be originally paid, it was converted into a two?year‑old camel. After the extended period the creditor required the debtor to pay the two‑year‑old camel instead a one‑year old camel. In the event of a third extension for the third year a three‑year old camel would become payable while for a forth extension a four‑year old camel became payable; thus the chain of increases and the extensions continued. Similar was the practice in respect of cash. Thus, if the debtor failed to make repayment in time, the period was extended by the creditor on the condition that the amount payable would be increased or even doubled, and in case one hundred dirhams or dinars were payable, the debtor was required to pay two hundred dirhams or dinars. At the end of the second year, if the period was extended further the amount was also doubled. These details have been recorded by Tabari on the authority of Ibn Juraij, a disciple of Hazrat Abdullah ibn Abbas. There are other reports found in the early sources with variations about the amount of increase or the rate of interest. These details have been collected by the companions and their followers with the purpose of preserving necessary information and data about the prevalent modes of usury and interest. These reports show that there existed a variety of modes and rates of interest, the common feature being the increase in lieu of time over and above the principal amount payable by way of loan or debt.
It may be mentioned here that the Holy Prophet took special measures to curb the practice of Riba and interest from Tayef because this practice had deeply ingrained in the body social and body economic of the Taifians and needed special measures to be eradicate. One such measure was a clear and express provision included in the agreement signed between them and the Holy Prophet at the time of their conversion to Islam. It has been reported by Abu Ubaid, who has quoted full text of the agreement, that the agreement also included the following provisions: "Whatever debt is payable to them by the people they will not be liable to pay except the principal sum. (Kitab al Amwal by Abu Ubaid al‑Qasim ibn Sallam, paragraphs 506‑507). A similar provision was made in the covenant issued by the Prophet to the Christian population of Najran in Southern Arabia. It provided that the citizenship of those who indulge in eating Riba would be cancelled (Kitab al?Amwal by Abu Ubaid, paragraph 502). The same practice was by and large prevalent in Madinah prior to the conversion of the city to Islam. Imam Malik has reported same details about the usurious practices prevalent in pre‑Islamic Arabia in his Muwatta. After Makkah and Tayef, Madinah was also known for its Riba‑based practices. Here, the creditors were mostly the Jews while debtors were mostly the peasants of Madinah. The Jews had invented some new modes of charging interest which were not found in other cities and towns of Arabia. In his masterpiece on the history of pre? Islamic Arabia, the Iraqi historian Dr. Jawad Ali tells us that the Jews would sell the commodities of common use by the Madinian population such as wheat, barley, dates and salt at a time when their supply was scarce or the season was off on a deferred payment and would charge a larger quantity of the same commodity at the time of repayment to create further scarcity and to resell that very commodity to its own producer again on the deferred payment of a higher amount: Thus the producers, traders and the agriculturists of Madinan continued to be indebted to the Jews. This practice not only increased the power and influence of the Jews but also contributed to the concentration and control of the Madinian wealth and resources in the hands of the Jewish businessmen. Not only this but the Jews also demanded that the properties and goods of the debtors be mortgaged with them or pledged to them. Imam Bukhari reports several incidents which show that the Jews demanded the mortgage of even the children, wives and weapons of the debtors.
These details clearly establish that the Arabs in pre‑Islamic Arabia were fully aware of the concept of commercial and productive loans. Their entire trade was financed through loans advanced on payment of interest. The affluent tribes of Thaqif and Banu Mughirah never needed loans for consumption purposes. The landed aristocracy of Madinah hardly needed consumption loans from the Jews. Most of their loans were either to finance their trade or to improve their agriculture. The claim that the Qur'an has condemned only the interest charged on personal or consumption loans is totally unfounded particularly in view of the unprecedented generosity of the Arabs in general and the Quraish in particular. Hashim ibn Abd Manaf, the
great grandfather of the Holy Prophet who had instituted the two celebrated trade journeys mentioned in the Qur'an as well was known for his unique generosity. The very name, Hashim, is indicative of that generosity. At the time of famine he would get the food prepared at his own expense and get it distributed among the poor of Makkah. Because of this he came to be known as Hashim or as "bread‑grinder". This habit of Hashim had percolated deep in all the members of the tribe of Quraish. Tabari has quoted a poet praising the Quraish for their generosity as saying:
These are the people who have mixed their poor with their wealthy so much so that their poor have become like the self‑sufficient.
This being the habit of the Arab traders, no one can say that they would charge interest on consumption loans given to a poor and needy person. Dr. Muhammad Yusufuddin has recorded details of the corporate trade conducted by the Quraish in pre‑Islamic Arabia. (See his book Islam ke Muashi Nazariyyea, (Karachi 1984, pp. 44--‑50).
Some other scholars have also studied trade and business prevalent in pre‑Islamic Arabia and have concluded that every tribe or sub‑tribe was like a business firm or investment company in which not only the members of that very tribe participated but also members of other tribes contributed with their funds and loans advanced either on the basis of profit‑sharing or on the basis of interest. Even the ladies conducted their business and financed the business of the others both as creditors as well as in capacity of inactive partners. The Mudarabah‑based business of Hazrat Khadijah in which the Holy Prophet participated sometime as an entrepreneur and sometimes as a managing agent is well‑known. There were other ladies in Makkah whose funds were invested in international trade. The well‑known trade caravan led by Abu Sufyan immediately before the Battle of Badr was funded among others by many ladies from Makkah. In his history, Tabari has recorded the details of these caravans under the third year of Hijra.
Another `argument' advanced in support of this point of view is that the Qur'4n has not prohibited interest. It has prohibited only usury. It is in view of this consideration that some people translate the term Riba as usury. Let us examine the difference between the two. It may be pointed out that the distinction between interest and usury was made on a wide scab for the first time in the 17th Century when banking emerged as an organized institution. This distinction was made on the basis of the purpose of borrowing. Increase on the loans advanced for personal and consumption purposes was called usury while the increase on commercial and productive loans was known as interest. It is believed that the purpose of this distinction was to grant moral and legal legitimacy to usury and to satisfy the conscience of the common man who hated usury and interest as part of his religious belief. Since it had become the backbone of the modern capitalist economy it was felt that the economic system could not successfully work without interest. The rapid expansion of the West in the field of colonization and its advancement in scientific discoveries coincided with its dazzling economic progress. In fact, the advancement of the West in commerce and industry was the mainstay of its military power which, in turn, sustained the political domination of different colonial powers in the Muslim world. This created a slavish and ‑defeatist mentality in the mind of many Muslims particularly those elitists classes which had lost their power and prestigious positions to the new masters. They sharply reacted to the political defeat. economic downfall and social disintegration of their co‑religionists Their sensitivity led them to believe that the power and prestigious of the West was drawn from its social, economic and political institutions. Despite partial truth in this belief, this added to the defeatist mentality of the former elitists classes. It also caused to weaken their confidence in their own values, history, civilization and religious foundations. Many of them did not wait long in subscribing to the idea that bank interest and capitalist economy was the penacea needed to cure their maladies and that Riba was different from interest, that Allah has prohibited only usury and that interest was not different from trade and profit. 1t was in this background that some Muslim leaders sincerely, though mistakenly, felt that if interest was declared to be prohibited it may cause insurmountable difficulties in the development of trade and industry in the Muslim World. Their concern with the welfare and future of the Muslims made them believe that bank interest was the only solution to the economic progress and welfare of the Muslims. They tried to satisfy their conscience by claiming that the Qur'anic Riba is not interest which was now allowed as lawful trade and business and what is prohibited is usury charged on personal loans, particularly usury charged at exorbitant rates. It is significant to note that those who fully subscribed to this way of thinking among the Muslims were those who had the first exposure with the West. A bulky literature came into existence as a result of their efforts in which the main concern was to portray the declining economy of the Muslim World and to play up the role of the banks in the development of the Western economies. Dr. Fazlur Rahman, a former Professor in the Faculty of Theology, Aligarh Muslim University has surveyed some such writings in his valuable book, Tijarati Sud: Tarikhi Awr Fiqhi Nuqtah‑i‑Nazar Se (Aligarh 1967, pp. 1‑‑5). The crux of their arguments was their claim that the Arabs were not aware of commercial interest either during the days of the Holy Prophet (peace be upon him) or before him, and the Riba, according to them, was only that which was charged on personal and consumption loans. We will deal with the question of distinction between usury and interest.
The writings and the literature produced in defence of bank interest also influenced a section of the Ulema who tried to legitimize Riba in the context of British India. They believed that since India was Dar al‑Harb and since, according to the opinion attributed to Imam Abu Hanifah, there was no Riba between a Muslim and a citizen of the Dar al‑Harb, therefore, bank interest should not be treated as Riba. Some of the Ulema issued Fatawa in support of this view. One such Fatwa was issued from Hyderabad Deccan which was published on a wide scale both within and outside the Indian Sub?-Continent. It was this Fatwa which was sent to Sayyid Rashid Rida to; confirmation. The answer given by Rashid Rida was relied upon by Mr. Khalid M. Ishaque in his submissions before us. Several leading ulema of the Sub‑Continent including Maulana Ashraf Ali Thanvi, Maulana Mufti Mahmood Hasan Tonki, Maulana Zafar Ahmad Usmani and Maulana Abul A'la Maududi came out with strong rejoinders and established that Riba?based transactions in India or elsewhere could not be justified or legalized on the plea that India was Dar al‑Harb.
As pointed out earlier, before the industrial revolution in Europe, there was no distinction between usury and interest. This was made in the wake of industrial revolution and commercial expansion when money and capital acquired supreme importance in human societies. In this context interest was justified as rent of capital and was substantiated by a well? developed philosophy. Before this revolution there was no such distinction between usury and interest either in the Islamic literature or in any other religious tradition of the East or the West. The definition given by almost every writer, of the term Riba included both usury and interest. Even the non‑Muslim writers defined the term Riba as usury and interest. The Shorter Encyclopedia of Islam (1953, p. 471) has included both interest and usury within the ambit of Riba.
The historical evidence available to us establishes beyond any shadow of doubt that corporate financing in its rudimentary form was known to the Arabs even before Islam. The Qur'an refers to two annual trade caravans undertaken by the Makkahn traders. This was an international trade covering the vast areas stretching over large territories and long distances. These caravans needed several months of travel which was carried on extensively. This trade involved the production or import' of goods, on the one hand, and their sale or export, on the other. This was done with the pooling of financial resources and trading and manufacturing skills. During the pre‑Islamic period all financial resources were mobilized on the basis of either interest or Mudarabah and Musharakah. Islam abolished the interest basis and organized the entire production and trade on the basis of Mudarabah and Musharakah. With the abolition of interest, economic activity in the Muslim World not only did not suffer any decline but there was an unprecedented increase in prosperity:
A combination of several economic and political factors, including the ability to mobilize adequate financial resources, was responsible for this prosperity. All these factors together provided a great boost to trade which flourished from Morocco and Spain in the West, to India and China in the East, Central Asia in the North and Africa in the South. The extension of Islamic trade influence is indicated not only by the available historical documents but also by the Muslim coins of the seventh to the eleventh centuries which have been found in several outlying parts of the then Islamic world. Dr. Muhammad Umar Chapra has referred in one of his articles submitted to this Court that man) Muslim coins have been found in different parts of Russia. Finland, Sweden, Norway, the British Isles and Ireland. The great wealth of material goods which the enterprising Islamic world procured from far‑distant lands were also exported to purpose. These consisted not only of Chinese, Indian and African products but also of the goods which the Muslim countries themselves produced or manufactured. The economic prosperity in the Muslim world had made possible a development of industrial skill which brought the artistic value of the products to an unrivalled height.
Mudarabah and Musharakah were the basic methods by which financial resources? were mobilized and combined with entrepreneurial and managerial skills for purposes of expanding long distance trade and supporting crafts and manufacture. They fulfilled the needs for commerce and industry and enabled them to thrive to the optimum level given by the prevailing technological environment. They brought to the disposal of commerce and industry the "entire reservoir of monetary resources of the medieval Islamic world" and served as a means of financing, and to some extent, insuring commercial ventures, as well as providing the combination of necessary skills and services for their satisfactory execution.
The legal instruments necessary for the extensive use of financing through Mudarabah and Sharikah were already available in the earliest Islamic period. These instruments, which constituted an important feature of both trade and industry and provided a framework for investment, are found in a developed form in some of the earliest Islamic legal works. Accordingly, Udovitch has been led to conclude that "some of the institutions, practices and concepts already fully developed in the Islamic legal sources of the late eighth century did not emerge in Europe until several centuries later. The efficacy and vitality of these legal commercial institutions endured for most of the Islamic Middle Agars".
With moral decay and political and economic degeneration, the Muslim World lost its vitality in all those walks of life which had once contributed to its rise and glory. Foreign domination, played its own devastating role. Although Riba is still despised by Muslims, centuries of Western political, economic and financial domination has unwittingly caused the Muslim World to drift away from the pooling of financial and Entrepreneurial resources through the humane institutions of Mudarabah and Musharakah. These institutions need to be revived, activated, institutionalized and modernized in order to get rid of Riba. They can no doubt once again play the same invigorating role of stimulating investments, rewarding skills and entrepreneurship and accelerating growth for the benefit of the Muslim masses.
The discussion made in preceding paragraphs has established beyond any shadow of doubt that commercial and productive loans were known to the Arabs and that the Qur'anic prohibition of Riba does include every kind of increase or interest charged on loans advanced for commercial and productive purposes. This discussion also disposes of the contentions of Maulana Jafar Shah Phulwarwi and Syed Yaqub Shah.
Counsel for the Federation, Dr. Sayyid Riazul Hasan Gillani has stressed as his main argument that Bank interest is a form of Riba al‑Fadl prohibition of which is not as strong as that of Riba al‑Nasi `ah. Mr. Khalid M. Ishaque also indirectly but clearly suggested that bank interest was a form of Riba al‑Fadl about which the Shariah is not so strict. In order to examine these submissions and also to understand the Shariah position about Riba al‑Fadl in its true perspective, it is necessary that the question of Riba al‑Fadl is studied in depth and examined in detail.
Riba al‑Fadl is also termed as Riba al‑Hadith and Riba al‑Bu vu. This category of Riba is different from the Riba par excellence in the sense that there is no direct increase on any deferred payment and, therefore, it does not fall directly under the category of Riba prohibited by the Qur'an. The prohibition of Riba al‑Fadl is based on the principle of Sada al‑Dhariah by the Holy Prophet (peace be upon him). There are many Ahadith reported by more than a dozen companions to the effect that the Prophet of Islam prohibited the sale of gold for gold, silver for silver, wheat for wheat, barley for barley, salt for salt and dates for dates if the two commodities are not exactly equal in terms of quantity and are not paid and delivered hand to hand. Apparently, it seems to be something very innocuous because even in a barter transaction no one would be tempted to sell a given quantity of wheat for a similar quantity of wheat paid and delivered then and there. But on a deeper examination it becomes clear that this prohibition was primarily to close the slightest possibility of increase on the principal amount which was possible if' this backdoor was left open. The Hadith is, in fact, a discouragement to enter into this kind of transaction. If it were allowed to sell these commodities with a difference in the quantity or with a permission to make deferred payment there was a strong possibility of using this mode of transaction to legalise increase on the principal amount: For example, a person could sell wheat of certain quantity for a bigger quantity to be paid/delivered to him at a later date. Now, wheat being a medium of exchange in some societies even today, would have become a source of Riba when used as medium of exchange in this transaction. There are several other examples which establish the policy of the Shariah to prohibit all such transactions which may in any eventuality lead to Riba‑generating dealing through such dealings. One such example of eating Riba through an indirect mechanism instead of charging interest on the money lent or loaned one could easily sell a commodity to the prospective borrower on a deferred payment and then immediately buy it back from him on the cash payment of lesser price. In actual terms it would mean that the commodity has been used merely to circumvent the Shariah about the prohibition of Riba. Otherwise, the net result was the receipt of a lesser amount by the borrower appearing in garb of a purchaser and buyer's liability to pay a higher amount with a certain increase over and above the original or principal amount. This was also declared to be Riba pure and simple by Hazrat Aisha when it was' reported to her that a person had contracted such a transaction with a companion. She immediately sent a message to the companion asking him to annul the transaction forthwith if he wanted to retain his reward as a companion of the Prophet.
In the Ahadith related to Riba al‑Fadl, the `Prophet of Islam has mentioned only six commodities. It is historically established that these six commodities among others, were used as medium of exchange in different parts of Arabia. Some of them are still used in rural societies in many parts of the world particularly in sub‑continent. However, there has been a slight difference of opinion among the jurists whether the prohibition be confined to these six commodities or be extended to other commodities as well. The overwhelming view of almost all the jurists barring very few exceptions is that the prohibition is not confined to these six. It is, rather, extended to other commodities as well. But the jurists disagree among themselves as to the grounds on the basis of which the prohibition is to be extended to other commodities. It is significant to note that the grounds suggested by different jurists to determine the common denominator for the application of prohibition include one or another ingredient of money as identified and explained by modern economists and experts of monetary and fiscal policies. For example, according to Imam Abu Hanifah, the common denominator is that the commodities should be fungible items, indicating thereby that the items may be used for counting of the units of the property or commodity purchased in consideration thereof. According to Imam Malik the common denominator is the storability of the items indicating thereby that it should be the store or repository of value.
This difference of opinion had started during the days of the companions themselves. Different companions tried to identify the common denominator and reached different conclusions. A great disciplinarian and superb systematiser as he was, Hazrat Umar felt uncomfortable with this difference of opinion on this important issue involving the trade and business in the fast expanding Muslim trade and finance. He regretted not to have been able to seek specific guidance from the Holy Prophet (peace be upon him) about the common denominator of these six commodities in the absence of which there was a possibility of a continuing difference of opinion on an issue of such a great importance. It was in this context that he said he did not have an opportunity to ask the Holy Prophet (peace be upon him) and that he recommended to avoid all doubtful transactions in order to avoid real Riba. This clearly shows that Hazrat Umar had no doubt or confusion about the Riba par excellence, its real nature, its prohibition or even about Riba al‑Fadl in so far as it related to the six commodities. What he considered to be doubtful was the gray area beyond the six commodities where the identification of common denominator was subject of discussion among the companions. Now, it will be wrong to assume that the question of bank interest has any ambiguity or confusion and that this ambiguity and confusion should be taken to be a ground for concluding that it is not Riba.
It is clear from a general look on the Ahadith dealing with Riba al?-Fadl that these specifically refer to trading transactions of a barter type. Loan too is, in a way, like‑for‑like exchange. It is, therefore, desirable to begin the argument with a review of the Qur'anic Injunctions about loan. A loan transaction always carries with itself some costs for the lender. Depending on the matter of the case, there may be various kinds of costs. Yes in a like‑for‑like exchange of commodities the lender must concede his costs and the lender must ignore the qualitative differences between the thing given and the thing taken back, and treat the two as the same in terms of the relevant units of exchange‑rupees in the case of rupee‑denominated loans, tons of wheat lent by tons and so on.
With these two points before us, it should now be easy to see the message in Ahadith on Riba, which are about trading of gold, silver, wheat, barley, dates and salt. We select the cases of gold and dates to explain the main point. The prophet (peace be upon him) ordered that gold be traded for gold on the basis of equality in terms of weight and on spot. In spot trading, gold‑for‑gold transaction meant exchanging gold in one form for that in another. A voluntary gold‑for‑gold exchange is unthinkable otherwise. It may also be recalled that once Hazrat Bilal traded two weights, of poor quality dates for one weight of good dates. The most likely reason on Bilal's part was that qualitative differences between the dates sold and those purchased justified their treatment as two different things and, hence, the exchange on unequal terms. But the Prophet (peace be upon him) declared the excess to be Riba. The point was: as long as Hazrat Bilal was transacting in a dates‑for‑dates framework, he ought to have ignored the qualitative differences between the two types of dates and traded them on a one‑to‑one and equal basis. Otherwise, the discrepancy in the give‑and‑take-?back process came under Riba.
The foregoing illustrations establish that the fundamental position of the Ahkam in the Ahadith is that of rationalizing trading practices with the Qur'anic Injunction on Riba. In this perspective, we may now discuss the meanings of various restrictions on trading specifically mentioned in the Ahadith. Basically, three conditions are prescribed to govern like‑for‑like exchanges of gold, silver, wheat, barley, dates and salt: mithlan‑bi‑mithlin, sawa'an‑bi‑sawa'in and yadan‑bi‑yadin. Of the three conditions, yadan‑bi‑yadin and sawa'an‑bi‑saiva'in are clear‑cut. Yadan‑bi‑yadin means "hand to hand" or "on spot". Sawa'an‑bi‑sawa'in implies that there must be equality in the exchange. The Ahadith further state that the equality was to be observed in terms of weight for gold and silver and by measure for the other four commodities. The condition mithlan‑hi‑mithlin calls for extreme care in interpretation.
It is noteworthy that the Ahadith explicitly refer to "gold for gold",? "silver for silver" and similar other exchanges. And, the condition mithlan‑bi‑mithlin comes in the Ahadith texts after the said mention. "Gold for gold" signifies that one is already talking in the framework of alike‑for‑like exchange. Thus, mithlan‑bi‑mithlin ought to mean something more than "like for like"‑ It cannot be translated as "same for same" either due to the following reason. If, for example, the gold to be given and that the gold to be taken back were identical in every respect, spot trading of gold for gold would become meaningless, and the decree in the Ahadith redundant. Thus, mithlan‑bi‑mithlin would mean that the unit of exchange must be one and the same for both buying and selling in like‑for‑like exchanges. That is, it should not be the case that one sells, say, wheat by some measure but buys it by a weight like kilograms; moreover, the chosen measure or weight must be the same for both buying and selling. This interpretation is supported by the fact that there were no uniform standards for weights and measures in Arabia during the early Islamic days. According to Abdullah ibn‑i‑Umar, the Prophet (peace be upon him) appreciated measures of the people o: Madinah as well as weights of the people of Makkah. Thus, for example, the mithlan‑bi‑rnithlin condition required the use of the same measures either that of Madinah or that of Makkah for both selling a product and buying its like. In other words, it was not to be the case that two Makkahn and Madinan traders exchanged their dates (of different qualities) with each one of them using a different measure to make his offer. This principle governed, among other things, trading transactions between Makkahn and Madinan businessmen in trade fairs at the time. The differences in the US and the UK measures of bushels, gallons and pints affirm the relevance of mithlan‑bi‑mithlin restriction even today. Together, the three conditions mithlan‑bi‑mithlin, satva'an‑bi‑sawa'in and vadan‑bi‑yadin firmly closed the doors of Riba in like‑for‑like trading exchanges.
Let us now review the dilemma in the literature about the significance of the spot restriction in the Ahadith. The Prophet (peace be upon him) ordered to strictly observe this condition irrespective of whether it was, for example, gold‑for‑gold or gold‑for‑silver trade. As noted above Fuqaha have taken an extreme position on this point. Dr. Muhammad Umar Chapra has raised an important question which is relevant to understand the wisdom of the prohibition of Riba al‑Fadl. He say, that before one concedes, that time lag alone means Riba in the said trading exchanges, the following points merit consideration.
Is it possible that if trading of gold for gold was on a one‑to‑one and equal basis by weight, as directed by the Prophet (peace be upon him), but either the payment or the delivery of gold was deferred, there was Riba? The answer of Dr. Chapra's this question is "no" because the said transaction would not involve any discrepancy in the give‑and‑take‑back process. That deferment in payment or delivery does not automatically amount to Riba, is also confirmed by the following fact; the Prophet (peace be upon him) imposed the same spot restriction on the heterogtrneous exchanges in gold, silver, wheat, barley, dates and salt as well, although he left the rates of exchange at the discretion of the trading parties, But, then, where did the significance of the spot restriction on trading lie? This point may be clarified with reference to the following narration. It so happened that the companions were on a military campaign under the command of Hazrat Mu'awiyah during the days of Hazrat Umar. The booty of war included a silver pot. Mu'awiyah ordered its auction with the price to be adjusted against the future salary of soldiers. Hazrat Ubadah ibn al‑Samit strongly objected to this, transaction, and it did not fall through. In giving his reasons, Hazrat Ubadah ibn al‑Samit repeated the message of his other well-?known Ahadith. In this Hadith the message between the lines was the following is (sic) that the salary of soldiers was in dirhams (silver coins), Thus the transaction became a silver‑for‑silver trade with deferment of payment at the buyer's end. It may now be seen that if the transaction lost its cash or spost character, it automatically became impossible to satisfy the saw'an‑bi‑sawa'in condition because the weight of the future dirhams at the buyer's end could be different from that of the silver pot. Thus a discrepancy of Riba became likely in the transaction. Indeed, these possibilities of Riba could be avoided with a directive by the Prophet (peace be upon him) obliging the companions to take suitable remedial measures and close the doors on accidentally landing into Riba by requiring them to observe the spot restriction in the said trading exchanges.
To close this discussion on the categories of Riba, particularly Riba al‑Fadl and Riba al‑N,asi'ah, we may sum‑up this discourse with the views of Dr. Muhammad Umar Chapra who has very lucidly thrown light on the philosophy of Riba al‑Fadl's prohibition. Among the most important teachings of Islam for establishing justice and eliminating exploitation in business transactions is the prohibition of all sources of unjustified enrichment. The Qur'an emphatically instructs Muslims not to devour each other's property wrongfully (2:188 and 4:29; see also 4:161 and 9:34). The Qur'an and the Sunnah have given principles whereby a Muslim Society can distinguish as to what constitutes a 'wrongful' or 'rightful' or 'unjustified' source of earning or acquisition of property from others. One of the important sources of unjustified earnings is receiving any monetary advantage in a business transaction without giving a just counter‑value. The prohibition of Riba appears in the Qur'an in four different revelations which came down in a gradual manner. The first of these (30:39), in Makkah, emphasises that while interest deprived the wealth of God's blessings, charity raised it manifold. The second (4:161), in the early Madina period, severely condemned it, in line with its prohibition in the previous scriptures. It placed those who took Riba in juxtaposition with those who wrongfully appropriated other people's property and threatened both with severe punishment from God. The third revelation (3:130‑2), around the second year after Hijrah, enjoined Muslims to keep away from Riba if they desired their own welfare. The fourth revelation came later and severely censured those who take Riba, established a clear distinction between trade and Riba, and required Muslims to annul all outstanding Riba, instructing them to take only the principal amount, and forego even the principal in case of the borrowers' hardship. The Prophet (peace be upon him) also condemned, in the most unambiguous words not only those who take Riba, but also those who give Riba and those who record the transaction or act as witnesses to it. He even equated the taking of Riba to committing adultery thirty‑six times or being guilty of incest with one's own mother.
Riba, literally means increase, addition, expansion or growth, technically refers to the 'premium' that must be paid by the borrower to the lender along with the principal amount as a condition for the loan or for an extension in its maturity. In this sense, Riba has the same meaning and import as interest in accordance with the consensus of the jurists without any exception. The term Riba is, however, used in the Shariah in two senses as we have already pointed out. The first is Riba al‑Nasi'ah and the second is Riba al‑Fadl. The term nasi'ah comes from the root nasa'a which means to postpone, defer, or wait, and refers to the time that is allowed for the borrower to repay the loan in return for the, 'addition' or the 'premium'. Hence Riba al‑Nasi'ah refers to the interest on loans. It is in this sense that the term Riba has been used in the Qur'an in the verse "God has forbidden interest". This is also the Riba which the Prophet (peace be upon him) referred to when he said: "There is no Riba except in Nasi'ah". The prohibition of Riba al‑Nasi'ah essentially implies that the fixing in advance of a positive return on a loan as a reward for waiting is not permitted by the Shariah. It makes no difference whether the return is a fixed or a variable per cent. of the principal, or an absolute amount to be paid in advance or on maturity, or a gift or service to be received as a condition for loan. The point in question is the predetermined positive ness of the return. It is important to note that, according to the Shariah, the waiting involved in the repayment of a loan does not itself justify a positive reward. There is absolutely no difference of opinion among all schools of Muslim jurisprudence that Riba al‑Nasi'ah is haram or prohibited. The nature of the prohibition is strict, absolute and unambiguous. There is no room for arguing that Riba refers to usury and not interest, because the Prophet (peace be upon him) prohibited the taking of even a small gift, service or favour as a condition for the loan, in addition to the principal. However, if the return on principal can be either positive or negative depending on the final outcome of the business, which is not known in advance, it is allowed provided that it is shared in accordance with the principles of justice laid down in the Shariah.
Islam, however, wishes to eliminate not merely the exploitation that intrinsic in the institution of interest, but also that which is inherent in all forms of dishonest and unjust exchanges in business transactions. These are extensively identified in the teachings of the Qur'an and the Sunnah. However they are also encompassed by the generic term of Riba al‑Fadl, which is the second sense in which Riba has been used and which is encountered in hand to hand purchase and sale of commodities. It covers all spot transactions involving cash payment on the one hand and immediate delivery of the commodity on the other. The discussion of Riba al‑Fadl has arisen from the Ahadith requiring that if gold, silver, wheat, barley, dates and salt, are exchanged against themselves they should be exchanged on the spot and he equal and alike. There are two questions which arise from these Ahadith. The first is why have only six commodities been specified? And the second is why is exactly the same reciprocal payment required?
Of the six commodities specified in the Ahadith dealing with Riba al‑Fadl, two unmistakably represent commodity money. Whereas the other c four represent staple food items. Hence, the jurists have over the centuries debated tile question of whether Riba al‑Fadl is confined only to these six items or it can be generalised to include other commodities; and it' so, what should be the reasoning (`illat) used for this purpose. On the basis of the characteristic of gold and silver as commodity money, it has been almost unanimously concluded that all commodities used as money enter the sweep of Riha al‑Fadl. With respect to the other four items, there is a difference of opinion. One opinion argues that since all four commodities are sold by weight or measure (Hanafi. Hanbali, Imami and Zaydi) therefore, all items which are so saleable would be subject of Riba al‑Fadl. A second opinion is that since all four items are edible, Riha al‑Fadl would be involved in all commodities which have the characteristic of edibility (Shafi'i and Hanbali). A third opinion is that since these items are necessary for subsistence and are storable (without being spoiled), therefore, all items that sustain life and are storable arc subject to Riba al‑Fadl (Maliki). The Zahiri school, however confines Riba al‑Fadl to only the six commodities specifically mentioned by the Prophet (peace be upon him). It is, however, the only school and a minority, to be so restrictive. A fourth, but perhaps a snore plausible, explanation is that all the six commodities were used as money in and around Madinah, particularly among the Bedouins, and therefore, Riba al‑Fadl would he involved in the exchange of any goods against cash or any commodity which is used as money.
The whole discussion, however, does not bring into focus the real significance of Riba al‑Fadl, which may be understood only by answering the question. On the surface it appears hard to understand why anyone would want to exchange a given quantity of gold or silver or any other commodity against its own counterpart, and that too
spot'. What is essentially being required is justice and fairplay in spot transactions: the price and the counter‑value should be just in all transactions where cash payment (irrespective of what constitutes money) is made by one party and the commodity or service is delivered reciprocally by the other. Anything that is received asextra' by one of the two parties to the transaction is Riba al‑Fadi. which could be defined in the words of Ibn al‑Arabs as "all excess Over?
what is justified by tile counter‑value". justice can be rendered only i: the two scales of the balance carry the same value of goods.
This point was explained in a most befitting manner by the Prophet (peace be upon him), when he referred to six important commodities and emphasised that if one scale has one of these commodities, the other scale also must have the same commodity, "like for like and equal for equal". To ensure justice, the Prophet (peace be upon him) even discouraged barter transactions and asked that a commodity for sale be exchanged against cash and the cash proceeds be used to buy the needed commodity. This is because it is not possible in a barter transaction, except for an expert, to visualise the fair equivalent of one commodity in terms of all other goods. Hence, the equivalents may be established only approximately thus leading to some injustice to one or the other party. The use of money could therefore help reduce the possibility of an unfair exchange. '
In this sense all commodities exchanged in the market would be subject to Riba al‑Fadi. One would then tend to agree with the majority of Muslim jurists who have not confined Riha al‑Fadl only to the six commodities mentioned but have tried to extend the coverage on tile basis of certain inherent characteristics of these six commodities. The more staple the food item or the greater its need for sustaining life, the greater tile injustice inflicted in all unfair exchange. Similarly, the greater the capability of a goods or service to be weighed or measured the greater would be the buyer's or the seller's exposure to Riba al‑Fadl if the just weight or measure is not given in exchange for tile money or the counter‑value received. The prohibition of Riba al Fall is thus, intended to ensure Justice and remove all forms of exploitation through `unfair' exchanges and to close all backdoors to Riba because, in the Islamic Shariah, anything that serves as a means to the lawful is also unlawful. The Holy Prophet peace be upon him) equated with Riba even the cheating of all unsophisticated entrant into the market and tile rigging of prices in an auction with the help of agents implying thereby that the extra money earned through such exploitation and deception is nothing else but Riba-al‑Fadl. Since people may he exploited or be cheated in several different ways, the Prophet (peace he upon him) warned that a Muslim could indulge in Riba in a number of ways. This is the reason why the Prophet (peace be upon him) said: "Abstain not only from Riba but also from Reebab". Reebah is from Rayb which literally means 'doubt' or 'suspicion' and refers to income which has the semblance of Riba or which raises doubt in the mind about its rightfulness. It covers all income derived from injustice to, or exploitation of, others.
The Riba al‑Nasi'ah and Riba al‑Fadl are both essential counterparts of the verse "God has allowed trade and prohibited Riba (2:275). While Riba al‑Nasi'ah relates to loans and is prohibited in the second part of the verse, Riba al‑Fadl relates to trade and is implied in the first part. Trade is allowed in principle, but it does not mean that everything is allowed in trade. Since the injustice inflicted through Riba may also be perpetuated through business transactions, Riba al‑Fadl refers to all such injustices or exploitations. It requires absence of rigging, uncertainty, speculation, monopoly or monopsony. It demands a fair knowledge of the prevailing prices on the part of both the buyer and the seller. It necessitates C the elimination of cheating in prices or quality, and in measurements or C weights. All business practices which lead to the exploitation of the buyer or the seller or to a restriction of fair competition must be effectively prohibited.
While Riba al‑Nasi'ah can be defined in a few words, Riba al-?Fadl, deals with a wide rang of business transactions and practices and is not so easy to be defined in precise terms. This is what prompted `Umar, the Second Caliph to advise the Muslims by way of precaution to give up Riba as well as Reebah. It is true that the Prophet (peace be upon him) did not elaborate Riba al‑Fadl inasmuch detail as one may have desired. However, this was not necessary. The whole Qur'an and the Sunnah are there to help the Ummah. This is the ongoing challenge to all Muslims ‑ to examine their economic practices continually in the light, of Islamic teachings and to eliminate all shades of injustice. This is a more difficult task than eliminating Riba al‑Nasi'ah. It requires a total commitment, an overall restructuring of the entire economy within the Islamic framework to ensure justice. This was, and is, the unique contribution of Islam. While Riba al‑Nasi'ah was well‑known in the Jahiliyyah (pre‑Islam period) the concept of Riba al‑Fadl was introduced by Islam and reflects the stamp of its own unflinching emphasis on socio‑economic justice.
The argument that interest was prohibited because during the Prophet's days there were only consumption loans and interest charged on such loans caused hardship is also unfounded and invalid both on historical and factual counts, as we have already discussed, as well as on technical and economic grounds. During the Prophetic period, the Muslim Society had become sufficiently inspired to adopt simple living and to shun conspicuous and unnecessary consumption. There was no question of borrowing for either self‑display or for unnecessary consumption needs. It had also become adequately organized to fulfil the basic needs of the poor and those in hardship due to any natural calamity. However, even if it is assumed that, in spite of simple living and the socio‑political commitment of a Muslim Society to fulfil the basic needs of those hard‑pressed, consumption loans were resorted to, these must have been limited and for small amounts, and fulfilled primarily through qurud hasanah. As rightly pointed out by the eminent Muslim scholar and jurist, late Shaykh Muhammad Abu Zahara, there is absolutely no evidence to support the contention that the Riba of Jahtltyyah was on consumption loans and not on development loan, In fact, the loans for which a research scholar finds support in history are production loans. The circumstances of the Arabs, the position of Makkah and the trade of Quraysh, all lend support to the assertion that the loans were for production and not consumption purposes. Hence, the Qur'anic verse about remitting the principal in the event of the borrower?s hardship does not refer to consumption loans. It refers essentially to interest‑based business loans where the borrower had encountered losses and was unable to repay even the principal, let alone the interest.
The whole argument that interest causes hardship only for the one who borrows for consumption needs is unfounded. It is the obligation of the Muslim society to meet the dire consumption needs of the poor. Borrowing for other consumption purposes needs to be controlled and organized by the society as well as by the State. Borrowing in a Muslim Society should be largely for business purposes. It is only in this context that one may be able to understand the argument of the Jahiliyyah that trade is like interest. While in trade an entrepreneur has the prospect of making a profit, he also faces the risk of incurring a loss. In contrast to this, interest is predetermined to be positive irrespective of the ultimate outcome of business, which may be positive or negative depending to a great extent on factors beyond the control of the entrepreneur. Imam Fakhruddin Razi posed the question of what was wrong in charging interest when the borrower was going to employ the funds so borrowed in his business and thereby earn a profit. His well‑considered reply to the question was that the earning of profit is uncertain while the payment of interest is predetermined and certain. The profit may or may not be realised. Hence there can be no doubt that the payment of something definite in return for something uncertain inflicts a harm.
Accordingly, Riba is essentially in conflict with the clear and unequivocal Islamic emphasis on socio‑economic justice. Financiers who do not wish to take the risk are entitled to only the principal and no more. Those who insist on charging Riba in spite of its prohibition are declared by the Qur'an to be at war with God and His Prophet (peace be upon him). While declaring the total and final abolition of interest on the occasion of his Farewell Pilgrimage, the Prophet (peace be upon him) announced the remission of interest accumulated in favour of his own uncle 'Abbas ibn 'Abd al‑Muttalib. This was interest on business loans given to the Banu Thaqif tribe of Tayef. This tribe had not taken the loan from 'Abbas and others for fulfilling consumption needs but for expanding their business. This was not an isolated case but a prevalent form of business financing in those days. Several tribe members having skill in trade and business acted essentially like large partnerships, borrowing finances from members of their own tribe or from other friendly tribes, to carry on large‑scale businesses, which their own resources would not permit. This is because they could not finance on their own too many business trips abroad from east to west. The slow means of communication, the difficult terrain and the harsh climate confined them to mainly two caravan trips during the year, one in summer and one in winter (al‑Qur'an, 106:2). Accordingly, they collected all the finance they could muster through loans and borrowings in order to be able to purchase the local produce, sell it abroad and bring back what was necessary to satisfy the needs of their society for imports during a specific period. Most of the interest‑based transactions mentioned in the classical commentaries in relation to the prohibition of Riba are loans taken by tribes from each other, each tribe acting like a large partnership company. Islam abolished the interest‑based nature of these relationships but reorganized them on the basis of profit‑and‑loss‑sharing. The financier got a just share and the entrepreneur did not get crushed under adverse conditions, one of which was the caravan being waylaid during the journey.
The principal reason why the Qur'an has delivered such a harsh verdict against interest is that Islam wishes to establish an economic system where all forms of exploitation are eliminated, and particularly, the injustice perpetuated in the form of the financier being assured of a positive return without doing any work or sharing the risk, while the entrepreneur, in spite of his management and hard work, is not assured of such a positive return is brought to an end. Islam wishes to establish justice between the financier and the entrepreneur and order to achieve socio‑economic objectives of Shariah interest had to be prohibited in Islamic society. According to Umar Chapra, the difficulty to understand the Islamic prohibition of interest comes from lack of appreciation of Islamic values and particularly its uncompromising emphasis on socio‑economic justice and equitable distribution of income and wealth. Any attempt to treat the prohibition of Riba as an isolated religious injunction and not as an integral part of the Islamic economic order with its overall ethos, goals and values is bound to create confusion.
After having examined different views about Riba, its categories and kinds, it is proper if the general rules regulating the matter are also discussed in the light of the Shariah. As is abundantly clear from the preceding discussion, Riba is the predetermined, fixed and time‑related increase over and above the principal of a loan or debt. A distinction is also maintained between Riba al‑Nasi'ah (Riba in loans) and Riba al‑Fadl (Riba in trading). Several explanations are offered to rationalize the law of Riba. The most important of these explanations is that through the prohibition of Riba, Islam puts an end to zulm (exploitation or injustice). Occurrence of zulm is often traced to lenders seeking a return while borrowers might be in dire need of funds. Another conclusion drawn‑with reference to the permissibility of trade is that guaranteed return claimed by owners of capital is despicable because other economic agents have to exert effort and/or expose themselves to risk for seeking any gains. While thses explanations may have some element of truth in them, they leave much to example, they become less convincing when one finds that Shariah does not, in normal conditions, prescribe any ceiling on prices and, thereby, the rate of profit even when trading activities may carry little or no risk but it is to be remembered that charging of exhorbitant or excessive profit is not conceived.
Riba, Islam puts an end to zulm (exploitation or injustice). Occurrence of zulm is often traced to lenders seeking a return while borrowers might be in dire need of funds. Another conclusion drawn‑with reference to the permissibility of trade is that guaranteed return claimed by owners of capital is' despicable because other economic agents have to exert effort and/or expose themselves to risk for seeking any gains. While these explanations may have some element of truth in them, they leave much to be desired. For example, they become less convincing when one finds that Shariah does not, in normal conditions, prescribe any ceiling on prices and, thereby, the rate of profit even when trading activities may carry little or no risk but it is to be remebered that charging of exhorbitant or excessive profit is not conceived.
A correct approach to understand Riba would be to treat it as a technical term in the Qur'an and Hadith, like salah, saum, zakah and hajj, and to determine its meaning with reference to these two primary sources of Islamic knowledge. Briefly, the argument can be understood with reference to the basic verdict on Riba in the Qur'an. In the light of al‑Baqarah 2:279 which restricts creditors to their principals, this decree can be stated as follows: All loans and debts must be settled on an equal basis (in terms of the units of the object of the loan/debt). The same principle is to be followed in retiring debts created in lieu of, for example, sales or purchases on deferred payment or delivery basis. If a loan or debt is not handled in this manner, it would constitute a violation of the law of Islam about Riba and, hence, give rise to Riba.
Interest is a pre‑determined, fixed and time‑related excess on loans and debts. But as explained above, Riba is a broader concept. It stems from a violation of the Qur'anic decree that loans and debts must be settled on an equal basis. Likewise, the purpose for which loans are taken is also unimportant for purposes of Riba. At present, bank transactions involving interest come under the purview of loan transactions. Thus bank interest is
Riba. That modern banks have no precedent in Islamic history is no ground for treating bank interest differently from Riba for two reasons. First, notwithstanding their complex nature, banks still personify groups of individuals‑their shareholders. Hence, the prohibition of Riba applicable to individuals automatically carries over to banks. Second, again notwithstanding the complexities of modern transactions, they are still combinations of primary transactions‑such as lending, trading, leasing, partnership, etc. for which the basic principles have been laid down. Any change in the nomenclature of interest to mark‑up' orprofit' is inconsequential from the point of view of Riba as long as the basic transaction between banks and their customers remains a loan transaction.
Riba arises in loans, and profits in trading. A loan transaction represents the case of temporary exchange‑give and take back of property rights of the thing at hand for the pendency of the transaction. Trading, on the other hand, is a case of irrevocable exchange of property rights between two parties: ownership of the object of sale goes from the seller to the buyer and that of the thing paid toward price from the buyer to the seller. Alternatively, one may view the loan transaction as a homogeneous exchange and trading as a heterogeneous exchange. Thus, Riba and profits relate to two different situations with their own legal H implications. Accordingly, any comparison between the two is unwarranted. This point also applies to profits versus interest comparisons. Economists have viewed profits as reward for risk‑taking. This interpretation is only partly true. Primarily, profits arise in trading in which two parties are involved in the process of reciprocal and irrevocable exchange of their property rights. On the other hand, lending involves transfer of some of the rights related to that property only for the pendency of loan‑a limited period. The claim to a reward from another party through loan transactions, albeit Riba, is not recognized in Shariah.
Deposits in Government‑sponsored saving schemes, Defence Savings Certificates, Treasury Bills, Federal Investment Bonds, Foreign Exchange Bearer Certificates, Prize Bonds and their likes, are all debt instalments. The fact that it is the Government which is on the other side of the contract does not change the character of the transaction. A loan is a loan whether it is taken from an individual, a group or an institution. From the Shariah point of view, all these instruments represent "loan" contracts between the Government and the parties subscribing to these instruments. The holder in each case gives money and wants his money back, and there is no other contract governing the legal relation with the issuer of these instruments. In a technical sense, therefore, these are all direct money‑for‑money exchanges. Accordingly, interest, mark‑up or "profit" offered on them is nothing but Riba irrespective of the name given to it. The same argument also applies to zero‑coupon bonds in which case buyers pay a lesser price initially but receive a greater sum equal to the face value of the bonds. Some people mix up the question of Government loans with the concept of Hasn‑i‑Ada or better repayment found in the Ahadith. It is contended that the Prophet of Islam (peace be upon him) used to please his creditors at the time of repayment of loan by paying him more than what was his due. It is pleaded that if the Government on its own pays or gives more than the amount received it should not be considered Riba because it is not pre‑fixed or predetermined. This plea may appear to be plausible on the face of it but this increased payment cannot be called Hasn‑i‑Ada. A Hasn?i‑Ada was never declared beforehand, was never expected by the creditor and was never allowed to him as a matter of right. Moreover, it was a personal favour by the Holy Prophet (peace be upon him) to his creditor.
Rent arises in a lease contract that involves the transfer of usufruct of an asset while ownership remains with the lessor. This is essentially a different arrangement as compared to a loan contract. Therefore, there is no point in equating rent with Riba. Alternatively, one can say that, for example, house rent is not Riba because the tenant and the landlord enter into a transaction of money for housing services a heterogeneous exchange‑whereas Riba arises in give and take back of items of the same kind. Likewise, in Mudarabah and Musharakah two forms of business partnership‑the financier is also a legal party to the use of funds. Thus these transactions are fundamentally different from a loan transaction. Accordingly, both these transactions are outside the purview of Riba. Similarly, Muzara'ah and Musaqaat‑two special kinds of partnership' as such have nothing to do with Riba. Riba may lead to zulm, and thus the prohibition of Riba‑ would result in putting an end to exploitative practices. But it does not necessarily follow that an end of zulm is the genesis of the prohibition of Riba.
Restricting the rationale of the prohibition of Riba to the elimination of zulm as referred to in al‑Baqarah 2:279 is mistaken for two reasons. First, the verse points to the existence of some dispute between two parties that was L settled through this verse, while the end‑of‑exploitation explanation is given independent of the nature of the dispute. Second, the factual position was that according to this verse, both creditors and debtors were directed to give each other their respective rights in the light of the Shariah. It is pertinent to note that in the earlier revelations about the prohibition of Riba, the directive was that loan transactions be contracted and debts retired on equal basis, and there is no mention of zulm or its equivalent
Some people try to rationalize or institutionalize Riba on the basis? of indexation, mostly due to their concern about changes in the value and the purchasing power of money in inflationary situations. Their usual plea is ac follows. Even though Riba (interest) is prohibited and a lender cannot claim at a priori fixed return on his loan, he must be compensated for the loss he incurs in the purchasing power of his money due to inflation This may be done through indexation of loans with a view to compensate the loss caused by inflation. We shall, however, come to the question of inflation at a subsequent stage in this judgment. We will also discuss the pros and cons of indexation as a suggested solution to this problem.
However, suffices here to say that according to the law of Riba, all loans and debts are to be settled on an equal basis in terms of the units of the object of loan or debt. In the case of paper currency, the exchange takes place by counting. Accordingly, the following conclusion would be drawn for loans for debts denominated in, for example, rupees: if the sum lent (or debt contracted) amounted to Rs.1,000 the lender (creditor) may claim only one thousand rupees by counting no more, no less. This argument may also be restated, again, in the context of Riba, as follows:--
(i) The nature of a loan transaction does not change with inflation. So there are no grounds for changing the scope of the application of the law in inflationary regimes.
(ii) Lenders already incur transaction costs associated with loan transactions. Inflation just escalates those costs. So there are again no grounds for changing the applicability of the law.
(iii) A lender may get nothing if the borrower expires without leaving behind anything because debt is not transferable from one generation to the next through inheritance. Thus, reduction in value of loans and debts to zero does not represent a new situation, vis‑a‑ vis the original rules dealing with Riba, that merits special treatment.
The factual position about the other ground for indexation‑putting an end to injustice to lenders and creditors ‑ has been clarified above. It can also be substantiated by noting that when Allah the Almighty directed the creditors to give grace period to debtors in a tight situation (al‑Baqarah 2:280), the extension was clearly with reference to the then existing debt obligations, not the inflation‑adjusted principal in future. In view of this there are no grounds for exempting loans and debts denominated in paper currency from the law on Riba. But despite the above analysis and conclusions drawn against indexation, there is no Shariah bar banking remedial steps to neutralize the effect of inflation for loan and other debts created through credit transactions. A general principle in this regard would be that not only the means but also the ends should be Shariah‑compatible. Keeping this in view, a recommended strategy would be to eliminate unanticipated inflation from the economy through prudent Government policies, and to make anticipated inflation a part of decision‑making by all concerned‑keeping in view their needs and other interests. Thus, for example, instead of there being a loan to a needy person to fulfil his consumption or business need, there may be either a bai' mu'ajjal or a partnership arrangement between the resource‑owner and the needy party. While the need of the latter may be fulfilled, concerns of the former may be accommodated through the margin added in the deferred price or automatically adjusted through the realized profits.
The upshot of this discussion is that the relevant laws of the Sharjah which prohibit Riba are binding for individual believers as well as for any collective entity that represents them and their Governments. They also apply to non‑Muslim subjects of a Muslim State. The prohibition of Riba applies to both taking and giving of Riba. This, in turn, implies that regardless of whom one may be transacting with and where, that person or anyone representing him ought to observe and abide by the prohibition of Riba. The prohibition of Riba essentially requires that, generally speaking, all like‑for‑like exchanges be executed on an equal basis‑in terms of the relevant units of exchange. If this does not suit someone, he is free to avoid such an exchange and to pursue an alternative permissible course of action.
Leaving the evils and maladies of
Riba aside for the time being, it is clear that bank interest does fall under the definition of Riba referred to and discussed above. Banks have normally two tier transactions. On the one hand, they accept money from the savers and pay them return on their savings. On the other hand, they lend money to the entrepreneurs who pay return to the banks at a rate higher than the one paid by the banks to the savers. Let us take the second tier first. The money provided by the banks to the entrepreneur is undoubtedly a loan. Any increase on the principal amount paid by entrepreneur to the bank must and does fall under the category of Riba al‑Nasi ah about the prohibition of which none of the appellants has any reservation. It is besides the point whether the entrepreneur employs and invests that money in a business, commerce, trade or industrial enterprise. As long as the repayment of the principal amount is guaranteed whether because of the collateral or otherwise it will remain a loan
(Qarz) and shall be subject to the principles of Shariah regulating loan
(Qarz). Moreover, the concern of the banks is never to ensure the success of the enterprise or to participate in the risk at any stage m any way. There is no moral or legal justification to demand any increase over this amount. As to the money of the savers with the bank it is normally claimed to be an Amanat
(Trust). Had it been really a trust it should have been regulated and managed under the law of Trust. For all practical, legal and theoretical purposes it has never been considered to be an Antanal or Trust. It is always and has always been treated to be a loan and meets all the required ingredients of a loan (Qarz) under the Shariah; its repayment is guaranteed and the bank has full freedom to use, spend and invest it in any manner which the bank decides; the saver cannot even take it back at will without meeting certain conditions.
In some cases a saver can take it back only in instalments and in other cases he has to give prior notice to the bank of his intention to withdraw hisAmanal' from the bank. Now, if it is a loan, no increase can be admissible thereon under the definition of Riba.
The half a century long experience in the field of Islamic Banking has brought to the fore a number of basic principles on which the edifice of Islamic Banking and finance rests. Without having a clear perception of these fundamental axioms, no meaningful or worthwhile progress can be made in the direction of establishing Islamic banking. It seems appropriate that before discussing the alternative modes of financing and investment suggested or put to operation so far, the suggested restructuring of banks? and financial institutions and other necessary steps to be taken, it is appropriate that these axioms are enumerated in clear and specific terms:
(i) The banks under the Islamic system shall continue to perform their primary functions of receiving money from the savers and making it available to various enterprises, entrepreneurs, business and businessmen. This exercise will be totally free from any involvement of Riba, Qimar, Gharar and such other practices which have been prohibited by the Shariah.
(ii) Riba is prohibited in all its forms. There is no difference between usury and interest, simple and compound interest, interest on nominal rate and interest on exorbitant rates. All these forms of interest fall under the category of Riba and are prohibited.
(iii) All transactions should be in exchange of commodities, goods, services or labour. No purely monetary transaction should be made because such transactions eventually lead to opening the door of Riba.
(iv) Loans should be avoided as far as possible in all commercial and business transactions. Financing on the basis of loaning and lending has no place in Islamic Shariah because the enterprise undertaken on the basis of lending and borrowing create loopholes for usurious practices.
(v) Lending and borrowing may be resorted to in exceptional cases to meet any emergency or contingency; but it should always be by a way of Qard‑i‑Hasan.
(vi) Banks under the Islamic system shall be primarily financial intermediaries to finance through equity, participation or partnership. Banks may also work as holding companies and may, where feasible, also directly engage themselves in commercial,? industrial, agricultural and other enterprises and businesses.
(vii) Any transaction or enterprise which is free from the fundamental prohibitions enumerated in the Shariah is Islamically allowed subject to other requirements laid down by the Shariah or the law.
(viii) Banks may render their services and undertake their operations in accordance with any of the forms or alternatives hereinafter enumerated; subject to the fundamental consideration of equity and risk participation:
(a) Mudarabah.
(b) Musharakah.
(c) Leasing.?????????????????????????????
(d) Murabahah.
(e) Bai Salam.??
(f) Bai‑Muajjal.
(g) Istisna (Pre‑production sale).
(h) Muzaraah.
(i) Musaqah.????
(j) Agency.
(k) Service charges
(l) Qard‑i‑Hasan.
(m) Buy ‑ Back Agreement (subject to certain conditions).
(n) Hire‑purchase.
(o) Sale on instalments.
(p) Developmental charges.??????
(q) Equity participation.
(r) Rent sharing.
(s)Sale and purchase of shares in such companies which have tangible assets.
(t) Purchase of trade bills.
(u) Financing through Auqaf. . . ???????????????????????
There might be some duplication and over‑lapping in some of these modes mentioned above but these are some of the examples which only show how different scholars and experts tried to develop modes of financing and investment keeping in view the framework of the Shariah. These modes, even if the list is expanded, will not in any way be exhaustive because new modes and techniques will keep on coming into existence. It is always the need of the entrepreneurs and the requirements of the market which give rise to new and novel modes and techniques. The approach of Shariah is not to lay down a set of exhaustive modes or techniques and prohibit the rest. The approach of the Shariah is just the other way round. It prohibits certain practices and permits the rest. These and any other Shariah modes are to be understood and applied in the light of this observation. We shall shortly discuss some of these alternatives in detail only to show that alternatives do exist which are being practised in Islamic banks and can easily be developed into viable alternatives.
(ix) In all transactions and dealings which involve any debt obligation the rights and privileges as well as the obligations and liabilities of both the parties should be specified beforehand and shall not be subjected to any change or modification later without mutual consent. This will apply to the specifications of commodities and manufactured goods in the contract of salam and istisna and delivery in the payment t of price in Bai‑Muajjal.
(x) No debt or financial liability can be sold at a discount. The discounting of bills have therefore been prohibited.
(xi) Transfer of obligation is permissible and shall be regulated under the laws of Kafalah and Hawalah.
(xii) Delay in payment of debt or in the delivery of goods should be dealt with under the law of civil obligations, or if need be, under the penal law for which appropriate provisions may be made in the statute book. Any delinquency or neglect of duty or obligation shall be dealt with under the normal law and shall not, in any way, lead to the increase in the financial liability if the concerned party.
(xiii) No debt shall be compounded or increased because of any delay or delinquency however long it might be.
(xiv) Only tangible things or legitimate entitlements shall be the subject of contracts of exchange, such as sales, rent, leasing, salam etc.
(xv) No one shall be authorized to sell a commodity or title thereto without taking it into his actual or constructive possession. As such forward sales not covered under the rules of Bai Salam? shall be prohibited.
(xvi) In a Salam sale both, the delivery of the commodity and the payment of the price cannot be deferred. It amounts to the sale of debt for debt which is not allowed.
(xvii) Exchanges of gold for gold, silver for silver, money for money e.g. local against foreign shall be void if it is not hand to hand, i.e. on the spot.
(xviii) All such agreements and transactions in which two or more exchange contracts are interdependently combined, are void. For example, loan dependent on sale or sale dependant on a loan shall be void.
(xix) Benefits or usufruct accruing from the collateral is the right of the owner. Financier has no right to use or enjoy it.
(xx) Any uncertainty about the rights and obligations of the parties or the specification of the commodity or its value which may lead to a dispute or litigation invalidates the contract.
The above discussion will show that under the Shariah no distinction can be made between interest and usury. It has been pointed out by different scholars that the distinction between usury and interest has no academic or scientific basis. It has been established that this so‑called distinction made to justify interest on weak and emotional grounds. Professor Shaikh Mahmud Ahmad has dealt with this question in his masterpiece, Man and Money. We may profitably give a list of his extremely valuable discussion on the history of the separation of usury from interest. It may be noted that Professor Mahmud's book, Man and Money is one of the best books written on Riba and interest and their economic and moral evils by the pen of a Muslim. Prof. Shaikh Mahmud Ahmad writes that one way of winning acceptability for interest was to emphasize the common elements, if any, between profit and interest, rent and interest or hire and interest. This was done to attract legitimacy to interest by confusing it with other categories. At the same time, the difference in the high and low rates of interest was played up to establish that it is only the high or exorbitant rate which was bad while the fair rate was something fully justified on economic grounds. Once the economic grounds were accepted at the popular level, there was no difficulty in giving them a moral? justification too. Through this device, the evil of interest, Riba or biyaj was attributed to usury and interest was artistically extricated from the consequences of this blame. According to Shaikh Mahmud Ahmad, this sophistry, as it was, is devoid even of superficial sanction. Even this superficial distinction made centuries ago to tolerate some forms of interest, has been rendered meaningless by the emergence of bank interest and credit in a powerful and institutionalized way.
It will be both significant and interesting to note that early Christian and Jewish usury was in no way different from al‑Riba or the Riba of the Qur'an. Under the influence of the Old Testament, the Christianity was uncompromisingly opposed to the institution of interest, even though the word used for it was usury, which conveyed the same meaning in the Middle Ages as interest does today. Charlemagne, under whom State forbade usury for the first time, defines it in his collection of ordinances as "where more is asked than is given". This definition (which is strikingly in conformity with the views of the Fuqaha) was rigorously applied in the decisions of the Church. Pope Eugene III, for instance, decreed that "mortgages, in which the lender enjoyed the fruits of a pledge without counting them towards the principal, were usurious". This verdict also fully conforms with the position of the jurists. Similarly Pope Alexander III declared that "credit sales at a price above the cash price were usurious. Even the troublesome permission in Deuteronomy to take usury from strangers had been superseded by the concept of universal brotherhood: there were no strangers.
As trade and industry developed after the 11th Century, the more rigorous application of the doctrine of prohibition of usury started being replaced by this differentiation between usury and interest. The Latin noun Usura means the use of any thing, in this case the use of borrowed capital, hence usury was the price paid for the use of money. On the other hand the Latin verb Intereo means "to be lost"; a substantive form Interesse developed into the modern term interest. Interest was not profit but loss. To claim usury was to demand a return for the use of money, which remained illicit, to claim interest was to demand compensation for loss which the lender suffered by depriving himself in various ways which became licit. This compensation for loss is now called opportunity cost of capital, which became a compulsive reason for the acceptance of interest. It is the development of institutionalized credit which rendered the differentiation of schoolmen obsolete, otherwise it is not possible to change them with sophistry at least in this context. The concept of opportunity cost of capital now seems to have become irrelevant in this age of institutionalized credit. It has become irrelevant because the need to differentiate between usury and interest is not so pressing outside the modernized Muslim elite as it was a few centuries ago. Now, the present interest is exactly what usury was claimed to be: i.e. payment of compensation or rent for the use of money. Towards the beginning of this century, a new justification was sought to give legitimacy to the differentiation between usury and interest, It was claimed that the reason for the opposition of the church to interest was because it was charged on consumption loans taken by the poor in their difficult days and the lender took unfair advantage of their need and charged them a rate of interest which was higher than what was 'fair'. This `unfair' rate was now termed as usury But what was fair and what was unfair and what was the logical or rational basis to determine the level of fairness, nobody bothered to answer Thus, interest was now confined to the 'profit' charged on loans advanced for productive purposes. It was claimed that since the borrower makes profit out of that loan he must share it with the lender. But this logic conveniently ignored that the lender should also share the loss to keep the balance equal.
The propositions that. borrower must, in every case, share his profit, and NOT the loss, with the lender who is not concerned with the fate of the enterprise, has been accepted without any effort to substantiate i;. The net result of all such propositions, the reprehensible character of usury and the fair character of interest, is passed from hand to hand as an accepted, authenticated and established truth. No one appears to have concerned himself with examining the propositions whose joining together produces this distinction. No one appears to have raised any of the queries which should have normally occurred to every one: Were loans granted for consumptional purposes only or mostly in earlier societies? Do modern societies mostly avail of loans for productive purposes? Is there any empirical evidence, any historical proof showing a remarkable excess of productive loans in modern communities as contrasted with a significant excess of consumption loans in olden societies? Is there any statistical verification that the rate of interest charged in modern times is significantly lower than the one that was charged in earlier societies? What is a fair rate of interest, by exceeding which its nature and nomenclature is charged from interest to usury? Do the really needy ever enter the money market? Did they ever do so at any time past? Is there any guarantee that a loan secured for a productive purpose will necessarily result in a reward to the entrepreneur in excess of the rate of interest which he pays for the loan? How does the exploitative element existing in consumptional loans form a different genus or specie compared to the exploitative element in a productive loan when interest is charged during gestation period of an enterprise, or even after it when the production of value made possible by the loan is lower than the rate of interest?
After raising these important questions, Professor Shaikh Mahmud Ahmad says that the distinction between usury and interest was made without any scientific study or empirical enquiry. No one appears to have deemed it essential to provide any kind of evidence in support of this assertion based on the half dozen contentions. The learned economist takes upon himself the onus of examining the questions raised by him and brings home the shaky foundations on which this hypothesis has been developed. Here is the summery of the findings of late Professor Shaikh Mahmud Ahmad about the illogical and arbitrary distinctions between usury and interest. At the outset of his discussion on the subject he says that some economists have tried to shift the responsibility of differentiation between usury and interest to the so‑called sophistry of the schoolmen. However, the fact is that they were forced into it by the pressures of trade and industry. It was the existence of "extrinsic titles" which the church recognized worthy of acceptance which necessitated the employment of the word interest, signifying payment for the loss incurred in advancing a loan, as contrasted with usury which was payment for the use of money, and which remained unacceptable to church. The extrinsic titles are now called by a blanket name of the opportunity cost of capital. While there could be some justification for this differentiation by schoolmen, at the time when it was made, in view of the fact of individual lending and borrower being no less significant than institutional credit, the present day development of financial intermediaries as practically exclusive source of capital, has rendered "extrinsic titles" as completely irrelevant. The concept of opportunity cost which could have sanctioned the use of the word interest in place of usury is already an obsolete concept. The effort of economists to provide moral underpinning to the institution of interest with the help of an extinct notion is a variety of sophistry of which it is grossly unfair to charge the schoolmen.
While keeping the concept of opportunity cost at its back and call, economics has chiselled a whole set of reasons for differentiation between usury and interest. It advances the view that in earlier ages loans were advanced for consumptional purposes, to persons in straitened circumstances, and lenders took unfair advantage of their need and charged an unduly high rate of interest. This was usury and was rightly considered reprehensible. Interest `on the other hand' is charge on productive loans. Since these enable the borrowers to earn substantial profits, there is no harm in the claim of the lender to demand? a part of these profits. This is interest and is entirely fair. This makes a list of half a dozen propositions whose joining together was ensured to seek support for this differentiation. Whether or not it is valid would hinge on how correct the various propositions adduced in its support happen to be. Professor Mahmud expresses his surprise when he notices that economics tends to shirk from examining in depth any of these propositions, and assertion and its repetition are regarded as adequate substitutes for inductive evidence. Economics knows and observes rules of the game which devolve on it as a social science, except when it has to deal with any issue relating to interest, and insistence on the distinction between usury and interest, without advancing a single sustainable evidence for its various contentions, illustrates how indifferent to reality economics can at times become. Since economics declines to advance proof for its contentions on the basis of which it differentiates interest from usury, Professor Mahmud Ahmad undertook to examine their postulates beginning with the claim that in earlier societies most loans were advanced for consumptional purposes.
Looking up the history of ancient societies and their economic picture it appears highly unlikely that consumptional loans could command the bulk of the credit market. For instance, Sumerian society was a busy commercial society. Seals unearthed from the ruins relating to the period indicate international commerce and many clay containing are business documents with ample evidence of credit transactions on interest, but there is no mention of consumptional loans. Similar is the situation of Babylonians who were essentially a commercial society. Most documents that have reached us relate to sales, loans, contracts, partnerships etc. These also indicate a highly developed system of finance. History attests to credit of both these societies being primarily related to commerce and industry, but there is hardly any evidence of consumptional loans. The prosperity of ancient Egypt was nurtured by import of raw materials and export of finished goods. Credit was so developed that written transfers, prepared by? scribes, available in markets, took the place of exchange of commodities or payment, something which is enough to indicate that credit was largely commercial. Similar situation prevails in the case of the other ancient societies including the Assyrians, the Phoenicians, the Arabians, the Indians and the Chinese. which fact confirms the chain that consumptional loans constituted the bulk of credit in ancient societies is not borne out by history. However, instead of reaching an indirect conclusion from the nature of economies of most ancient societies. if the specific history of the nature of loans prevalent in these ancient societies is checked up, one can directly find a confirmation of these results.
History gives ample evidence that earliest loans were those of seeds and animals. Although there is evidence of the existence of all varieties of loans, the first mention of extensive borrowing is made in connection with ship loans in Greece in 7th Century B.C. Productive loans appear to have become even more prevalent after 400 B. C. in Greece. We have some evidence of consumptional loans as well but these were seldom given to people in distress, but were given to the wealthy or average farmers to meet personal emergencies. Loans are stated to have been on the security of either cargoes, or pawns or real estate. Though loan sharks are mentioned in Greek literature but these are not characteristic of any ancient society as no modern society is free of this scourge. There were mitigating circumstances like free loans from temples which are no longer available. Records ofloans in Roman Africa indicate setting up of endowment funds by wealthy persons which advanced loans at 5‑6 per cent. In 13th Century Europe consumptional loans were associated with nobility who often incurred debt and ruined. History, thus, appears to contradict both the assertions of economics that early loans were primarily for consumptional purposes and were given mostly to people in distress.
Misrepresentation by economics regarding the nature of loans is not confined to ancient societies but extends to modern age where, contrary to unimpeachable statistical evidence, it is claimed that most of the lending is for productive purposes. The factual position regarding present times is that in most countries belonging to the so‑called free world, budgetary deficit of Governments alone exceeds more than one‑half of the loanable resources of these countries. Checking the situation in this regard of just two countries, viz., U.S.A. and Pakistan, relating to the decade from 1974‑83, Professor Mahmud reaches the conclusion that the above statement is more likely to be an under‑estimate than an over‑estimate. Unweighted annual average of budgetary deficit for 10 years in U.S.A. comes to 107.17 per cent. of the annual increase of demand and time deposits in the country during these very years. In the case of Pakistan unweighted annual average of budgetary deficit for the period 1975‑82 works up to 64.98 per cent. of the annual accretion of total deposits in the banking system. A noteworthy feature of these figures is that the trend of deficit in both countries is virtually consistently in the upward direction This is not the only variety of consumptional loans which pervades the scene. Installment purchases, which involves 13.3 per cent. of disposable income in U.S.A. and is a significant entity in Pakistan as well, have to be added along with other consumptional loans like those covered by credit cards.
So far three of the basic ingredients of the argument of economics for differentiating usury from interest have been formed to have no objective reality. Neither the loans in earlier ages were for consumptional purposes, nor are loans in the present day for productive purposes, nor the implication that exploitation characterized earlier loans and creativity inheres in modern ones conforms to facts; nor was this the reason why Christian Church was opposed to interest and why it relented in its acceptance subsequently. The claim of economics that "almost all loans" in earlier societies were given to "people in distress" is a variety of gross mis‑statement of which no discipline can feel proud. The mere fact that security of loan and its assurance of return along with interest has been the permanent consideration of every lender in all ages, immediately excludes the needy and the destitute from the money market. Even pawnbroking is not available to people below the level of moderate poverty. The nearest we come to distress is the case of emancipated peasants who mortgaged their lands to be able to work over them.
A cardinal postulate on which economics leans for its differentiation between interest and usury is the claim that in earlier societies loans were advanced at high rates of interest and were usurious, while a reasonable rate of interest is charged in the modern times. Though no one has defined the word "reasonable", a study of interest rates in various ages becomes necessary for evaluation of the claim made by economics. Starting with ancient times and confining to the rates more often mentioned in particular contexts we find 20% the customary rate of interest for silver loans during Sumerian period in Babylonia, i.e. 3000 to 1900 B.C. Laws of Manu in India, in 24th Century B.C. set 24% as permissible level of interest. Code of Hammurabi fixed a limit of 20% for loans of silver, a legal maximum which lasted from 1900 to 732 B.C. and beyond during the Neo‑Babylonian Empire. In Greece, the rate at the time of Solon (638‑558 B.C) was about 16 per cent. and ranged between 12 and 18 per cent. during the time of Orators in Athens. Twelve Tables about 443 B.C. fixed the maximum rate at 8‑1/3 per cent. The Greek temple of Delos charged 10% on all loans. In Egypt after 300 B.C. one finds repeated mention of "normal" interest rate of 12 per cent., which was regarded legal and maximum by Roman Emperors. The Code of Justinian (6th Century A. D.) declared 12 % as exorbitant and reduced it to the range of 4‑8 per cent. It is for us now to compare the maxima and the minima of ancient times with those of the present days and decide whether there is any difference of the magnitude which can justify the coining of two different names for payment for the use of money.
Early middle ages are marked by controversy about usury and by diverse methods of avoiding it, including partnerships, annuities and triple contracts these last were also called "5 per cent. contracts". The information about interest rates during this period is relatively scarce, partly because of usury laws and partly because of disturbed conditions in Europe. These factors also operated in some measure in the case of the Islamic World. Though, in the early middle ages, Byzantine commerce could raise money at the moderate rate of 8 to 12 per cent., which was lower still in 10th Century, it was not usual for the rest of Europe. During the 12th Century the rate varied from 8 to 20 per cent. at various periods and places, except for 43.1/3 per cent. charged by Jews in' England. /During the 13th Century even more fanciful rates were charged by Jews which sometime went up to 300 per cent. Because of widespread dissatisfaction with such high rates, various States fixed maximum limits beyond which would be deemed usury. These varied from 15% in Milan to 10% in Verona. In the fourteenth Century except for loans to princes which commanded 30 per cent. interest, loans could be secured around 15 % . Long term Government loans paid only 5 % . In the 15th Century Montes Piatatis were established which helped lower pawnshop rates to 6 per cent., 5 per cent. became the standard on triple contracts. By the 16th Century Monies had developed into saving banks, and charged 8‑10% from borrowers. Annuities were floated by Governments with return varying form 5 to 6 per cent. The trend towards low rate continued in the 17th Century and the discount rate of Bank of England reached 4% in 1968. Colbert, Finance Minister of Louis XIV reduced the return of annuities to 5 % and rates in Amsterdam varied between 3 and 4 per cent. Early middle ages indicate interest rates much higher than ancient rates, whereas the fall in rates during later middle ages lowers the level compared to what obtains today. None of these realities justifies the thesis of economics regarding high rates in ancient times and low rate in modern times. In the Eighteenth Century. England, the Government emerged as the chief borrower, mainly for war purposes. The yield on bonds, which were mostly of the form of perpetual annuities, varied from 3.50 to 6.57 per cent. Usury limit applied on all other loans, which was 6% at first and 5 % later. In France, 5 % is the commonly mentioned rate, particularly in connection with perpetual annuities, but when opportunity presented itself 8‑1/2? per cent. became the ruling rate. There were no usury laws in Holland and yet the rate seldom exceeded 3 per cent. In Italy and Germany 5 % was considered normal for census annuities, though some times it fell to 4%. In U.S.A. 5% was regarded a suitable rate and 8% an exorbitant one. England witnessed in nineteenth century rapid economic growth and declining interest rates. Throughout the century yield on British consols kept falling till it was below 2 per cent. in the last decade of the century. Dutch long rates were generally higher than British long rates, reversing the position of earlier two centuries, which was reflected in the change in economic position of the two centuries. Situation was not dissimilar in Belgium, Germany and Switzerland, but in U.S.A., in spite of the declining trend of interest rates, these were almost always higher than the British rates and witnessed wide fluctuations.
The history of interest rates in the present century is remarkable for its wide gyrations. Between 1900 and 1975 we find the lowest and the highest interest rates of marketable credit instruments. For instance, in U.S.A. in 1964 best long municipal bonds sold to yield less than 1 per cent., whereas at the peak in 1974 commercial paper yields reached 12%. The change in interest rates in England, France and Holland is in identical directions. On this basis of this valuable fund of information, Professor Shaikh Mahmud Ahmad reaches the unmistakable conclusion that the? rise and fall of interest rates has an inverse co‑relation with the rise and fall of nations. Sidney Homer illustrates this point with reference to several civilizations including those of Babylonia, Greece and Rome. In modern Western civilization, there has been identical fall till the middle of 20th Century and the consistent rise since then can only lead to eventual disintegration. However, that may be, the gyration of rates in this or earlier centuries does not support the thesis of overriding declining trend in rates to justify differentiating interest from usury. The only difference appears to be the widening of the band of fluctuations. We have had the lowest interest rates in this century, provided we exclude availability of free loans, at least partially, in some earlier societies. Simultaneously peak yields of 20th Century are well above identical yields of 17th, 18th and 19th Centuries. The statutory limit for small loan companies in U.S.A. exceeds the limits prescribed by Hammurabi, and even Manu. If we confine ourselves to exceptionally fanciful rates charged by Jews in the middle ages, loan sharks in U.S.A., according to a study made in 1933, charge anything between 240 to 1500 per cent. per annum. Whatever rate of interest we look into from the prime to the Government long one, or the consumptional to the statutory one, 20th Century appears ahead of all earlier ages and epochs. Therefore, the entire basis of differentiation between usury and interest, so far as the level of rates is concerned has no legs to stand upon.
The differentiation of interest from usury as already noted is predicated by economists upon six main postulates. These are, firstly, that loans in earlier societies were mainly advanced for consumptional purposes and to people in distress; secondly, modern loans are largely advanced for productive purposes; thirdly, that the former category of loans is exploitative and the latter creative; fourthly, that this was the reason why Christian church was opposed to usury and eventually relented in favour of interest; fifthly, that interest in earlier ages was high; and, sixthly, that it is comparatively low now. Except the third postulate we have examined each one at some length and found them factually devoid of any basis. There is much to be said about the third postulate as well, but if we concede this postulate to economists, it will involve, in case it adheres to its logic, calling the present basis of banking as usury, as the loans are largely consumptional and advanced at rates which are among the highest in the entire history of interest rates. Applying the criteria of economists, if all loans are usurious today, then it is the responsibility of economics to point out the exact location of that interest which it is trying persistently to differentiate itself from usury.
There are two more fundamental questions, overreaching the flimsy and false postulates of economics, relating to differentiation between interest and usury, to which no attention appears to have been paid. Firstly, what is the principle which governs the differentiation between the two, and secondly, what exactly is the level at which one ends and the other begins? The late economist only amplifies these questions and leaves it to those who regard this differentiation as legitimate to answer these. He finds variations in the level of usury both during the middle ages and at present between various States of U.S.A. How exactly malevolence of usury shifts to benevolence of interest when one crosses a specific limit by even a fraction of 1 per cent., or even while sticking to the same limit by merely crossing over a specific boundary, or while sticking to the same limit and the same location by merely crossing a particular date in a particular year; or finally how does the same rate at the same time and at the same pace becomes benign in one case and malignant in the other?
This so‑called differentiation between usury and interest is not comparable to the one between profit and profiteering and rent and rack‑rent because there? are principles which govern these differentiations. The absence of a comparable principle in the case of usury and interest is very much like the absence of any categorization among various degrees of blackmail, or adulteration or murder. If this categorization is to be retained evolution of a fundamental principle would be necessary. It is possible to argue that though the basis of differentiation between interest and usury projected by economics may be unsustainable the differentiation may yet be valid for other reasons. In this, context erosion of the value of money during the period of a loan is sometime advanced as a cogent argument. Although the question of inflation has been separately dealt with at length in this judgment, we may see at this stage what Prof. Mahmud has to say on this problem. According to him, if inflation were historically an inseparable appendage of our economy the argument would be an unanswerable one. As it is we who have inflicted it upon ourselves through expansionary fiscal and monetary policies in order to restrict unemployment, instead of eradicating it by adopting the remedies suggested by the economists, particularly by Keynes. If inflation has emerged on account of our mishandling of the economy dictated by our desire to retain the institution of interest, we cannot now turn round and project this as an argument for perpetuation of the same exploitative institution. If interest is the cause of inflation, it cannot now be used as its cure.
Another practical consideration advanced for retention of interest relates to meeting the costs of banking and making it a worthwhile vocation. This again would have been a persuasive consideration provided it were accompanied by compelling evidence that no substitute of interest, shorn of its depredation, can be devised. Actually, we have not even seriously started on our quest in this direction, making the argument patently premature. But suppose after making the necessary effort we do not find a workable alternative to interest, it would be a good argument for retention of interest, but not for the reason of its assumed benevolence as contrasted with usury, but for the reason that an unexploitative basis of credit, in spite of all conceivable efforts, had eluded our grasp. Similarly, capital depletion as justification of interest has no valid basis because interest is a payment for financial capital and not for physical capital. All theories of interest are mere quibbling and all positive qualities attributed to this institution including the fairy tale of its differentiation from usury mere balderdash. According to Prof. Mahmud Ahmad, in spite of these convincing arguments, interest exists because no equally workable alternative basis of banking has yet been devised. After raising the question, how far this persuasive argument is withheld for the fear of focusing of attention of all creative thought on the devising of an unexploitative credit structure, he thinks it is something best left to the reader to decide.
What Professor Shaikh Mahmud Ahmad has said about bank interest applies to the problem of bank reserve. There is no mention of its restrictive role which we are forced to suffer because of the absence of an alternative which may be able to perform its positive functions. This issue hitherto has not deserved even a mention by our economics. Interest is in reality only monopoly price charged by capital. Its rise and fall has no relevance to the fine‑woven difference between interest and usury, but merely with the limit of what the traffic will bear. Bank reserve plays a double role in enabling perpetuation of this monopoly price. On the one side, it represents collusion between wealth owners which is an essential ingredient of monopoly, and, on the other, t ensures restrictive supply of capital resources in order to confer on them eligibility of demanding a price for their utilization. Interest in short is an exploitative category completely indistinguishable from what was called usury a few centuries back.
The question of interest is closely related with the concept of money which occupies an important place in any discussion on financial, fiscal and monetary reform. It is generally claimed by the western writers on the subject that money was introduced much later at a certain stage of evolution. Before that stage, it is asserted, that exchange and transfer of commodities was done on the basis of barter which signified direct exchange of goods and service. But there being no historical evidence to substantiate this claim, it seems to be based on mere conjecture. It appears from a Hadith that the concept of money is as old as human dealings and transactions are. The Prophet of Islam is reported to have said that Allah has created gold and silver to be the natural money. It shows these two metals have been designed to serve as medium of exchange, measure of value and storing the wealth and easy mode of deferred payments. But it does not mean that in primitive societies barter exchange had not been common. Rather, it is still practised at many places particularly in the remote areas of under‑developed countries. The Shariah has taken cognizance of both monetary exchange and barter exchange and has laid down principles to regulate both kinds of transactions and dealings. The law of Riba takes care of both the kinds of economies. While Riba al‑Nasi `ah primarily seeks to eliminate interest from monetary economy where goods buy money and money buys goods, the t prohibition of Riba al‑Fadl seeks elimination of interest from barter, economy where goods buy goods. Although barter economy is rapidly shrinking at domestic level, it exists at international level and may continue for sometime in future as well. It is not, therefore, safe or advisable to brush it aside as something bygone and outdated. The traditional difficulties and demerits of a barter economy as enumerated by the writers on monetary theories apart, the relevance of Islamic precepts about the prohibition of Riba al‑Fadl remains to have a permanent relevance. Muslim Jurists and economic thinkers seem to have been aware of difficulties faced in a barter system. It was perhaps to overcome the problem of the lack of double coincidence of wants that they tried to identify certain commodities as quasi-?money. The discussions made by Muslim jurists for the identification of the Illah and the determination of ratio decidendi clearly indicate their desire to develop quasi‑monetary commodities. According to Iman Malik, for example, the ratio decidendi of the prohibition of the six well known commodities is the storability and facility to make deferred payments. According to Imam Abu Hanifah, it is the common measurement and fungibility of these commodities which is the Illah of their prohibition.
The upshot of this discussion is that Islam acknowledges not only the real money, namely gold and silver or anything which may represent them, but also takes into consideration the barter practices and quasi‑money if it meets the requirement of measurement and storage of value and usability for making deferred payments.
The Hadith that gold and silver constitute the real and natural money is very significant. It docs not appear to be a mere statement of a historical fact. It seems to he a reaffirmation of the universal economic principle that there has been and has to be a common, universally acknowledged and easily manageable medium of exchange which is nothing but gold and silver, whether in the form of bullion or coin or any promissory or banknote which should be supported by a corresponding quantity of gold. Historical records show that gold coins were in use even in the ancient‑most societies ever found on the surface of the globe. There has hardly been any excavation of ancient human dwelling where the traces of gold coinage have not been found. The introduction of paper money did create some problems for Muslim jurists of the eighteenth and nineteenth centuries who faced some difficulties in understanding the true nature of paper money and, accordingly, different points of view were advanced by the jurists in their effort to formulate Islamic positions regarding paper money according to their respective understandings and perceptions. The nature and dimensions of paper currency has undergone such quick changes that Muslim jurists had to keep pace with the changing positions of the western bankers and fiscal experts. The different and apparently conflicting views of Muslim jurists are to be explained and interpreted in the light of the changes in the nature and attendant features and functions of paper money in leading western economies, particularly in Britain, France and other colonial powers. In 19th Century most Muslim jurists tried to explain paper money in terms of Islamic categories of Kafalah, Hawalah and other similar instruments. But these traditional instruments were never meant to be used as paper money. They were simply designed to serve as means of transferring debt or other obligations from one person to another. Their nature was not different from a cheque which facilitates transaction between two specific parties and expires after a single transaction. Like a cheque, a Hawalah instrument was not money; it was simply a written order or undertaking to transfer or accept money or obligation. This important background must always be kept in view while considering the writings of Muslim Scholars and Ulema about paper money as introduced by western powers in the Muslim World.
As far as the kinds of money are concerned, the Shariah position is very clear. The metallic money made of gold and silver is the real and the natural money and is subject to all the rules and principles laid down in the Shariah to regulate its transaction, transfer, use, investment and all other forms of disposal. Money made of other metals such as nickel, copper and steel, is to be taken as money as long as it is considered a legal tender. This kind of money was normally classified as lulus and Muslim Scholars have dealt with it in detail. We will come to it later.
The standard money or full bodied money was in vogue during the days of the Prophet of Islam and continued to be in use for quite sometime after him. In fact during his days and the days of his immediate successors the gold and silver coins which were in circulation in Arabia and elsewhere were standard money and their value for non‑monetary purposes was exactly the same as their value as money. The fulus made mostly of copper or nickel represented only the token money as their intrinsic value as a metal was definitely muchless than the face value they carried. But one thing is very significant in respect of fulus which should always be kept in mind. The fulus were used mostly, if not exclusively, as units of gold or silver coins. The number of fulus included in a particular silver or gold coin varied from time to time as a result of the interplay of market and other forces and the value of one Fals fluctuated without affecting the value of the parent coin of gold or silver whose value underwent little change and that too very rarely. In a way the fulus were subsidiary money in their, relation to the standard money. The Fiqh literature has extensively dealt with these kinds of money in the context of commercial contracts, trade operations and business transactions.
The paper money, being something comparatively, new, found little mention in the standard works on Fiqh produced even as late as the seventeenth or eighteenth centuries. Most of the Muslim scholars and Ulema had an encounter with paper money when it was not a fully representative paper money and was, in fact and in effect, a kind of receipt issued from the circulating agency for full‑bodied coins or their equivalent amount of gold or silver in bullion. As such Muslim Scholars and Ulema in the beginning did not consider paper money to be real money and treated it only the way a receipt is treated. Later, when the representative paper money degenerated into convertible and then non‑convertible paper money, Muslim Scholars started reviewing their earlier positions. There have been different views and opinions about the Islamic position vis‑a‑vis fiduciary money or the fiat money. But the consensus which appears now to have been made is that the fiat money is money for all practical purposes and will have to be taken as a substitute for gold and silver, the real and natural money. There is no difficulty as far as the legal status of fiat money is concerned. However, the difficulty arises when it is asserted, to quote J.M. Keyens, that the fiat money has no fixed value in terms of an objective standard. Again, the distinction made by Keyens between what he calls the money of account and the money proper has to be dealt with carefully in order to formate Islamic positions vis‑a‑vis the same. According to him, money of account is represented by debts, prices and the general purchasing power. In fact, it is the general purchasing power which now seems to be occupying the field rapidly and is perhaps driving out other forms of money to the corner. The concept of SDR is nothing but a money of account which is now controlling most of the international transactions. However, it is too early and pre?mature to express any definite ruling or final verdict on the Islamic position about the money‑of‑account as a whole and different kinds of this money will have to be taken separately. Some of them will continue to be dealt with under the law of Hawalah and Kafalah. Some other kinds may be taken to be the substitute for real money, namely gold and silver, in so far as their use as medium of exchange and unit of value is concerned. Some other forms of money‑of‑account e.g., SDRs will have to be equated with fiat money in so far as the application of law of Riba is concerned. The question of negotiable instruments is closely related to, if not all together dependent on, the formulation of Islamic position about the money‑of‑account and near money. The non‑legal‑tender money or optional money is, in fact, a very grey area where one hard and fast rule cannot be applied. However, if the bonds, securities, debentures, treasury bills which have a ready market and are negotiable and easily convertible into real money within a short time, these should be treated like a substitute of the fiat money and should be subject to those very limitations and restrictions which control the fiat and the real money. However, such other types of the money‑of‑account which have no ready market and not easily negotiable and convertible into real money shall continue to be treated like personal instruments and Sukuk.
The question of currency and coins has also occupied a significant position in the discussion on Islamic solution to inflation and the possible role of indexation as well. Before we embark upon a treatment of Islamic position about indexation it is necessary that the status and legal position of coins and currency in Islam is determined. This is necessary because some people confuse the modern concept of legal tender and flat money with the coins or lulus used in the early centuries of Islam as smaller units of dirhams and dinars. In the early days of Islam fungible items, particularly dates, wheat, barley, hides and such other similar commodities were used ", as medium of exchange in addition to gold and silver coins. It appears from the Qur'an that the gold, silver and other coins were used in very ancient societies. In the context of the people of the cave the Qur'an tells us that they had carried with them silver coins (wariq) for the hour of need. They sent one of their colleagues with these coins to the town to purchase food? for them (al‑Qur'an, al‑Kahf: 18). Similarly in the context of Prophet Yusuf there is a mention of dirhams paid by the Egyptian caravan for the purchase of young Yusuf (al‑Qur'an Yusuf 12). In his commentary, Tabari has quoted a report which shows that the people of Prophet Shuaib used to discount or reduce the weight of the coins which was prohibited by Prophet Shuaib. When. Islam came, various coins were in vogue in Arabia particularly in the main commercial centres of Tayef, Makkah and Madina. The popular currency was the Roman dinar made of gold, the Iranian? dirham made of silver and Yemenite coins made of copper. These were exchanged primarily on their face value which was not normally different from their intrinsic value. However, some people used to steal away gold and silver from the coins either by cutting their corners or otherwise which necessitated that in case of doubt these dinars and dirhams were weighed before they were accepted. During the days of Holy Prophet (p.b.u.h.) and the first Caliph, these coins continued to be in use. However, the Prophet of Islam (p.b.u.h.) gradually discouraged the barter system and encouraged monetary transactions for which he declared that gold and silver are the natural mediums of exchange and store of value. That is why in many transactions he directed that gold and silver (i.e. the money par excellence) should be the basis of mutual dealing. In respect of the payments of Zakat, Mahr, Diyat, Daman, Kharaj, Jiyah, Ushr and in several other areas the respective amounts were fixed in terms of dinars and dirhams. For Mudarabah particularly the jurists of Islam had considered it necessary that the capital be paid in the form of gold or silver, i.e. cash. This was, on the one hand, to close that doors for Riba al Fadl and to put an end to the tricks of the Jews, on the other.
In the 18th year of Hijrah the Second Caliph ordered the preparation of first Islamic dirhams with Islamic inscriptions on them which were circulated side by side with the Roman and Iranian coins. The Bayt‑ul-?Mal coordinated and controlled the circulation of all these coins and ensured that debased and less pure coins are replaced by the genuine and pure ones. This first Islamic coinage was confined to silver dirhams while the golden dinars continued to be as usual. Caliph Muawiyah was the first Muslim Ruler who got some dinars. However, towards the middle of the second half of the first century the Umayyad Caliph, Abdul Malik, reviewed the entire fiscal policy, demonetized all earlier coins including dirhams and dinars of various origins and substituted them with regular and permanent Islamic coins in 74 A.H. The demonetization of earlier coins was necessary because many of them were either debased or impure and as such, had a tendency of driving the Islamic coins out of circulation. It may be noted that Muslim Scholars noted this fact and advised Abdul Malik to eliminate all pre‑Islamic coins by demonetizing them so that they were totally out of circulation. The hallmark of the new Islamic coins was that their face value was exactly equal to their intrinsic value. The Umayyads not only regulated the preparation and circulation of coins but also ensured that no one violated the laws of coinage, their weightage and the rate of exchange. The historians Baladhuri and Maqrizi have preserved the details of the fiscal policy of the Umayyads.
The rate of exchange of these coins inter se was determined by the market forces keeping in view the respective intrinsic value of the metal concerned. Gold was the ultimate standard and it was with reference to gold that the rate of exchange in respect of other coins was determined. The position of copper fulus was, however, different. They were not considered money in themselves. They were, rather, smaller units to facilitate payment of the fraction of a dirham or other silver coins: the fulus neither had any independent reference of value in their own right nor could they replace the silver or gold coins. Had the copper fulus been independent monetary units they would have driven the silver coins out of circulation under the Gresham law. (It may be pointed out here that this law was not given by Gresham for the first time. It was noticed for the first time by Abdul Malik as pointed out earlier and was formally and academically discussed by Maqrizi. The law should therefore be called either Abdul Malik Law or Maqrizi Law).
The Holy Prophet (p.b.u.h.) issued instructions to regulate the exchange of the dinars and dirhams in such a way that not only Riba in deferment (al‑Nasiah) but also Riba on cash (al‑Fadl) is avoided. The principle of equality in the exchange of silver and gold was to prevent usurious activities in exchanges. According to Dr. Yusufuddin, in the early days of Islam the Roman, Iranian, Yemeni and other coins were in currency in the markets of Makkah and Madina. The traders going to other countries needed the currency of that particular country and got it exchanged with the available currency. The money‑changers used to discount at the time of exchanging the money of a country with that of another. The Hadith material included in Bukhari (Kitab al Buyu and Kitab al Sarj) indicates that the increase or decrease prohibited by the Holy Prophet in Riba al Fadl was in the context of such exchanges. Dr. Yusufuddin interprets the Hadith "I' reported by Hazrat Uthman that the Holy Prophet (p.b.u.h.) has said: "Do not sell one dinar for two dinars or one dirham for two dirhams in this context. This interpretation seems to be plausible and convincing because otherwise there seems to be no logic in purchasing one dinar for two dinars and one dirhani for two dirhams. A similar Hadith has also been reported by Imam Malik on the authority of Abu Huraira that the Messenger of Allah (p.b.u.h.) has said: "Dinar for dinar and dirham for dirham (may only be exchanged) without any excess or increase between the two". Commenting on these two Ahadith, as well as on other instructions of the Holy Prophet (p.b.u.h.) in similar terms, Dr. Yusufuddin writes: "Those who may not be aware of the techniques and methods of money‑changers may possibly ask after casting a cursory glance over these traditions as to who and why would accept one dinar for two dinars or one rupee for 1.5 rupees. But even an elementary student of economics would clearly understand what these Ahadith mean. Generally, the silver and gold coins of one country are exchanged for the silver and gold coins of another country. But one has to concede some discount for the procurement of other coins and currencies". Commenting on the rationale and impact of these injunctions of the Holy Prophet (p.b.u.h.), Dr. Muhammad Yusufuddin further writes: "The international vision of the Mercy of the Worlds (Rahmat li'1‑Alamin) wished to introduce international coinage and currency in the whole world. In those days, the Roman coins were costlier and enjoyed greater prestige as compared to Iranian coins because the reputation of the Iranian Government was falling due to weaknesses creeping into it. Since that vision cannot be met if discount is allowed, there is no other solution except this that all Governments should have introduced silver and golden coins of the same weight and value at international level and abolish the practice of discounting, such as the number of the days of the week and the months of the year are equal almost in all the countries. The difficulties being faced by the business world due to the machinations of money‑changers, particularly the sufferings of the enslaved nations at the hands of the colonial powers are not unknown to the economists. The command of the Prophet of Islam as a universal message deserves to be considered in the light of its merits and benefits as well as the demerits of the existing practice". In support of his views about the interpretation of these Ahadith, Dr. Yusufuddin has referred to the views of some Western Scholars. He has extensively quoted from a book entitled Money and the Mechanism of Exchange (Chapter, 14). This interpretation of the author is further supported by the tendency of the modern world to adopt uniform modes of weights and measures at the international level. These uniform standards have beet adopted to facilitate the exchange of goods both at national and international levels and to avoid any confusion, misgiving and uncertainty: The same considerations applied to a situation where the currency and coins of one country are exchanged with those of other countries with excesses and increases. Apart from being Riba, it opens the door for confusion, uncertainty and practical difficulties. Although with the introduction of paper money and fiduciary money the discussion of medieval economists about the metallic currency and coins have become less relevant, yet the principles which regulated this discussion are still applicable and the objectives which motivated Muslim jurists to control the exchange of currency and coins under strict Shariah regulations still require to be met.
As far as the copper fulus are concerned, it has already been pointed out that their position was not that of an independent currency. They were a form of sub‑money used only to make payments of the fractions of a silver coin because it was not easy to break one silver dirham into two equal parts for making payment of half dirham nor it was easy for the Government or the money changers to issue smaller silver coins to facilitate such factional payments. Therefore, the principles developed by the jurists to .t regulate the exchange of copper lulus will not be applicable to the paper currency and fiat money of today. Today's paper money has practically become almost like natural money equal in terms of its facility of exchange and credibility to the old silver and golden coins. It will, therefore; be subject to all those injunctions laid down in the Qur'an and the Sunnah which regulated the exchange or transactions of gold and silver.
However, this principle of equating paper money with gold and silver may be applied to stable currencies without any difficulty or problem. The problem arises when we deal with a currency which has no stability. As far as the minor inflationary or deflationary trends are concerned the tendency of Shariah is to ignore them and to leave them to be determined by the independent market forces provided they are operating in an atmosphere of freedom, fairplay, justice and law‑abiding market. But if the inflationary trend exceeds its natural limit and renders the currency totally unstable and undependable it can no more be equated with gold and silver. Here, an important question arises: How to decide whether a level of inflation is within the normal limits or has exceeded the acceptable normal limit. Unless this important question is decided the solution of the problem of inflationary trends and to save the rights of the creditors is not possible. The Qur'an requires (al‑Baqarah: 287) that neither the creditor is done injustice nor the debtor. It also requires (al‑Araf 85, etc.) that peoples' money should not be reduced. In view of these two Qur'anic injunctions if the inflation rate exceeds the limits of justice and fairplay steps shall have to be taken to protect the creditor from suffer and loss. But the problem is that inflation is not a simple and easy‑to‑understand phenomenon. It is a complicated issue which can be solved only through a long‑term planning and major changes in the fiscal, monetary and economic policies of the country. There are a number of forces which contribute to the emergence of hyper‑inflation or galloping inflation. We will, however, deal with this question shortly.
The principle of controlling Ghabn Fahish may be invoked to protect the rights of the creditor and to save him from loss. The Ghabn Fahish, which literally means excessive loss, has been defined as a loss which cannot be estimated by the experts. Muslim jurists have variously defined the amount which may be considered to be falling under Ghabn Fahish. What may be concluded from their discussion on the subject is that i an inflation which reaches the stage of hyper‑inflation or galloping inflation is to be treated under the principle of Ghabn Fahish and would call for steps to be taken for the protection of the rights of the creditor. Here, the principle developed by the jurists in respect of fulus seems to be applicable. They have concluded that if the circulation of the copper coins is stopped or the value of the fulus substantially falls as compared to their face value, they will loose their status as medium of exchange and stock of value and will no more be considered as Thaman Istilahi or legal tender. In such a case the original value of the fulus as prevalent at the time of the transaction shall have to be paid. Under this principle as long as a currency continues to be within the normal limits of inflation, the difference of its latent value will have to be ignored and all transactions, payment and repayment will have to be made on the basis of its face value. But as soon as it exceeds that limit and enters the province of hyper‑inflation it will be taken to have caused Ghabn Fahish to the creditor. Now, if the creditor is paid the same currency on the basis of its face value it will be an injustice to him in terms of Qur'anic verses quoted above. In that case he will have to be paid in accordance with the actual value of the currency as existed at the time of the contract. There have been jurists who are of the view that the payment should be made according to the value which existed at the time when the reduction in the value took place. But it is difficult to agree to this proposition in the context of inflation affecting the paper money. In the case of fulfus it was possible to identify a particular date on which the value was reduced but it is not possible in the context of a paper money always to identify the particular date on which the hyper‑inflation took place. Inflation is a continuing and on‑going process. Sometimes it continues to be within the normal limit while sometimes it crosses that limit and is called hyper?inflation. If demonetization or devaluation takes place by an order or decision of the Government which substantially reduces the value of money we may take that particular date to determine the value to be paid to the creditor. But in cases where a formal devaluation or demonetization has not taken place it may not be possible to determine with certainty and exactitude as to the date on which the hyper‑inflation took place. In view of this absence of certainty and exactitude the safest way is to fall back on the date on' which the transaction had taken place.
It has been asserted time and again by many people that whether bank interest is Riba as interpreted by Jassas does not include bank interest. This has been claimed by Mr. Khalid M. Ishaque as well as some other scholars whose writings have been placed before us in support of this contention. However, when the views of Jassas are examined in the light of his own writings, particularly his commentary on the Qur'an this assertion turns out to be baseless. He says in his Ahkam al‑Qur'an (Volume 1, page 551) that ' in Shariah, the term Riba also includes meanings and? situation which did not fall under the literal meanings of Riba as generally understood by the Arabs. The well‑known statement attributed to Hazrat Umar (r.a.) refers only to those meanings and situation. The reason is that the word Riba has become a term of the Shariah after the revelation of the Shariah and it needs elaboration as far as the extension of its meaning to this new situation is concerned. Hazrat Umar only referred to this elaboration, otherwise, there is no question of these aspects being hidden from Hazrat Umar. The form of Riba prevalent among the Arabs was that they advanced their capital such as Dirhams, Dinars etc. to people on the condition that the debtor will return this capital to the creditor at the maturity date along with the access determined by the creditor.' This statement of Abu Bakr Jassas is not only very comprehensive but repels several misunderstandings created by some modern writers. It clearly shows that the concern of Hazrat Umar was never in respect of the prevalent and known forms of Riba. It was only about those new forms which were declared to be Riba for the first time by the Shariah in addition to the existing form or forms. Secondly, he clearly says that the definition of Riba is so clear and well‑known that it could never be unknown or unintelligible to a man like Hazrat Umar. Thirdly, lie clearly and emphatically identifies the form of Riba prevalent in pre‑Islamic Arabia.
A survey of the literature on Hadith, Tafsir and pre‑Islamic history clarifies beyond any shadow of doubt that in spite of the variety of the forms of Riba, the common element in all these forms was the stipulated increase demanded by the creditor over and above the principal amount payable in a contract of loan or sale. Tabari, Jalaluddin Suyuti, Ibn‑i‑Kasir and Mahmood Alusi in their respective commentaries have collected example, of various transactions prevalent as Riba during the pre‑Islamic days 'these forms can be reduced into the following:
(i) Charging of interest on a loan advanced to a debtor to consideration of the time allowed for repayment. (al‑Durr al‑Manthur. Volume 1, page 366). This is the simplest form of Riba and undoubtedly includes the present day banking interest.
(ii) Compound interest charged on the principal amount and the interest accruing thereto in case the debtor failed to pay the debt at the appointed time. This was the case of charging interest at exorbitant rates doubling and redoubling the principal amount. The reason of singling out this form of Riba in Verse No. 130 of Aal‑i‑Imran is that it was so obviously evil and heinous that every single person agreed that it should be prohibited. This form of compound interest had a tendency of doubling and redoubling the payable amount. The interest charged by many of our banking and non‑banking financial institutions definitely falls under this category where in spite of paying double the amount a poor debtor is chased by the creditor.
(iii) The creditor would require the debtor to mortgage his valuables such as ornaments, jewellery and weaponry by fixing its price much lower than its actual market value. The loan was advanced keeping in view the lower price of the mortgaged property. They settled their claims by either confiscating the mortgaged goods or selling them at a higher price in the market.
(iv) As has been expressly reported by several authorities the creditor advanced commercial and productive loans on interest to leading businessmen and entrepreneurs. The principal amount along with the interest, both simple and compound, had to be repaid by the debtor irrespective of the success or failure of the business or enterprise. Hazrat Abbas used to advance such loans before Islam and it was this kind of interest which was abolished by the Holy Prophet (peace be upon him) in his Farewell Address (see among other sources al‑Durr al‑Manthur, Volume 1, page 364).
(v) Animals and cattle, particularly camels, were also advanced by way of loans and the animals to be repaid were required to be in higher in age than those originally loaned. In case the debtor was unable to pay at the maturity date the requirements of the animals in terms of age etc. were increased and, thus, the creditor would receive ultimately a fully developed and grown up he‑ or she‑camel in return of a young child‑camel of one year or even lest.
All these forms are included in what he has been called as Riba al?-Nasiah (or interest on deferred payments), Riba al‑Duyun (or interest on loans). Riba al‑Jahiliyyah (or interest prevalent in pre‑Islamic Arabia), Riba al‑Qur'an (or interest prohibited by the Qur'an), Riba Jah (or express interest) or Riba Haqiqi (or real interest). These are various names given only for convenience and facility of understanding by various scholars to one and the same thing. This kind of Riba was known to the Arabs both before Islam and also at the time when the revelation regarding the prohibition of Riba was given. This kind of Riba is to be distinguished from the second category introduced by Islam by way of preventive measures. The Arabs did not consider this second kind of transaction to be Riba before its prohibition by the Holy Prophet (peace be upon him). This has been termed by the jurists as Riba al‑Buyu (or interest on sales), Riba al‑Naqd (or interest on cash), Riba al‑Fadl (or interest by way of excess), Riba Khafi (or tacit interest) or Riba al‑Hadith (or interest prohibited by the Hadith).. The variety of names given to these two categories of Riba is sometimes confusing to non‑experts and has led some scholars to misunderstand and misinterpret the relevant texts and passages of jurists. As the first category of Riba was clearly and unequivocally understood by all and sundry, the jurists did not discuss it in much detail. Most of the discussion in the fiqh books is concentrated on the second category because it was something new and prohibited for the first time in Islam. This second category of Riba has been defined as the excess of one of the commodities in a sale of barter or exchange of cash if both the commodities are the same. Thus the exchange of wheat for wheat or gold for gold or silver for silver with excess or deferred payment on either sale has been declared as Riba al‑Fadl. However, we shall come to this category of Riba later.
Muslim Scholars have addressed themselves to the important question of the rationale of the prohibition of Riba. These include both classical writers and commentators of the Qur'an as well as the modern Muslim writers. The well‑known commentators of the Qur'an, Imam Fakhruddin Razi and Allamah Khazini have identified the following main reasons for the prohibition of Riba. Firstly, Riba‑based transactions have a tendency of eating up .people's money without consideration. A habitual interest eater gets money without any risk or labour whether the transaction is on the basis of cash payment or on the basis of deferred payment. Secondly, when interest gains currency it prevents people from productive activities such as trade and commerce with the result that this sphere of human activity withers away. Thirdly, interest puts an end to the pious act of giving free loans to people. If the interest is prohibited people would be happily prepared to give consumption loans to the needy persons in the society. Fourthly, for a Muslim, the very fact that the Qur'an has prohibited Riba is sufficient to abstain from it without seeking any further rationale or wisdom to justify its prohibition. Fifthly, the Riba‑based transactions have a strong tendency of causing injustice to the poor and to add to the wealth and affluence of the wealthy. Similar views have been expressed by Sayyid Qutb in his well‑known commentary Fi Zilal al‑Qur'an (Volume III, page 33). He says that the hallmark of an Islamic society is love and respect of each other's rights by the members of the society. People should demonstrate moral purity and good behaviour. When a person demands interest from another? person he can do so only after divorcing himself from good morals and conscience and whenever a society adopts this practice the whole society becomes devoid of mutual love, affection and the spirit of cooperation. Shaikh Muhammad Abu Zahrah, a leading jurist of modern Egypt considers injustice to be the basis of the prohibition of Riba. Injustice has been condemned and prohibited in respect of everyone. It is not something which may be prohibited for some people and may be accepted as permissible for others. The Holy Prophet (peace be upon him) reports that Allah, the Almighty, has said: "My Servant! I have declared injustice to be prescribed for Me and prohibited it to be practised among you. Therefore, do not deal with each other unjustly". Similar grounds have been mentioned by other commentaries of the Qur'an. In particular, the moral aspects of interest and its social implications have been highlighted by many jurists and the commentators of the Qur'an. Reference may be made to Qadi Sanaullah Panipati and Shaikh Abdul Haq Muhaddith Dihlivi. The former, a leading authority on Tafsir in late 19th Century Muslim India, has discussed the moral, spiritual and social implications of eating interest. He says that every human action has an impact on the inner psyche and the spirit of the person concerned. When a person commits an act in a habitual way, it becomes part of his personality and becomes integral to his spirit and psyche. Experience has shown that interest hardens the hearts and inculcates misery in the life of many and creates cowardice to such an extent that it cannot be properly explained (Tafsir Haqqani, Volume III, page 20).
In view of the clear and express prohibition of Riba, particularly Riba al‑Nasiah, there is a unanimity among the jurists that if a person denies the prohibition of Riba al‑Nasiah (interest payable on debts) and claims that it is not prohibited shall be treated to have denied an essential of Islam and shall be considered to be outside the fold of Islam. This view has been recorded in Mirqat, a commentary of Mishkat, a well known collection of Hadith (Volume III, page 313) as well as in Sawi's commentary of Jalalayn (Volume 1, page 116).
The upshot of this discussion is that the classification of Riba as made by Muslim jurists right from the beginning, has been mostly to facilitate understanding its rationale and grounds of prohibition. The most important and fundamental classification is that of Riba al‑Nasiah and Riba al‑Fadl. Generally, the former is considered to he the Riba par excellence while the latter was included in the definition of Riba by way of extension by Prophet (peace be upon him) to foreclose any possible avenue or backdoor to have access to Riba. Nasiah 'or Nasi literally means deferment or postponement. The term Plasi has been used in the Qur'an in another context to convey the meaning of deferment and postponement in the Qur'an (Chapter IX: 37) the term Nasi has been used in the sense of interchanging the months of the calendar with a view to postpone the month of Hajj to avoid certain prohibitions which were in vogue in pre‑Islamic Arabia. This literal meaning of Nasi and Nasiah is an integral part of the technical meaning of the term Riba al‑Nasiah which simply means increase of a debt i.e. a deferred payment. There have been various forms of charging this increase as well as the deferment of the payment but tile variety of form of increase or the mode of deferment was never held qtr understood to have any impact on the prohibition of Riba. According to the unanimous view of Muslim Jurists any stipulated increase on the principal amount to a deferred payment is Riba. Some scholars have called this form of Riba as the Riba par excellence, Riba al‑Qur'an, Riba al‑Jahiliyyah. It was called the Riba par excellence because this is the most important and most widely prevalent form of Riba. It is also the earliest form of Riba prohibited in almost all the major religions of the world as we shall sec later, it was called Riba al‑Jahilivvah because it was the most popular mode of Riba in practice during the Days of Ignorance. It is called Riba of the Qur'an because this form of Riba was directly hit by the Qur'anic prohibition. Those who think these arc different fortes or categories of Riba are mistaken as the nature and the definition of all these forms is one and the same. Riba al‑Nasiah is further classified by some latter writers into simple Riba and compound Riba. However, these latter categories might have some importance for purposes of calculation and accounting, they have no relevance as far as the prohibition is concerned. An increase on the principal amount, whether simple or compound, falls under Riba and is prohibited. Some writers of the recent past have tried to build‑tin a theory according to which only compound interest would fall under Riba and simple interest would be permissible. They rely on Chapter III: 130 of Qur'an where the believers have been forbidden to eat Riba doubled and redoubled. On a deeper examination this logic is eroded when seen in the light of other Qur'anic verses on the subject, particularly verses 278‑279 of Chapter II as well as the bulk of Ahadith on the subject. In order to understand the historical context and the chronological order in which the Qur'anic verses on Riba were revealed a brief discussion on these verses is needed. This discussion, in fact, is mostly based on the study made by Dr. Sayyid Tahir who placed before the Court his valuable article entitled Qur an and Riba, published in the Qur'anic Horizons, Lahore, April‑June, 1996.
The first Qur'anic revelation on Riba is 30:39, which is a Makkahn Surah. According to Maulana Abul A'ala Maududi (TaJheem‑u1‑Qur'an, Vol. 3, pp. 726‑7), its time of revelation is 5 years before the Hijrah of the Prophet (peace be upon him). Maulana Amin Ahsan Islahi (Tadabbur‑e?Qur'an, Vol. 6, pp. 90‑‑100) notes that the verse is a part of the message in which Muslims are advised to become single‑minded about Islam as the way of life. For this purpose, the suggested line of action is (i) development of Taqwa, (ii) extreme caution against shirk, (iii) establishment of Salat, (iv) spending on one's near‑relatives, the destitute, and the wayfarer, and (v) caution against Riba. The verse 39 of Surah Rum emphatically says that the Riba‑based investments on your part which you undertake, in order to increase your wealth on the basis of other people's (i.e., the borrowers' assets, do not increase from the point of view of Allah. However, rest assured about the acceptance of what you give by way of Zakat for the sake of Allah; those who give Zakat are the ones whose net worth increases manifold with Allah. This verse is a complete message in itself. It contain reference to the undesirability of Riba which appears in the perspective of lending, and Zakat in the general sense of charitable and other expenditures for the sake of Allah. The verse laid the seed of Riba‑free economic system which was to be given to the Muslim society later.
The second verse to the chronological order is 4:160. The circumstances at the time (e.g., the expulsion of Bani Qainqa' from Madinah in Shawwal 2 A.H.) and the text of the verses implies that they were revealed quite early in the Madinan period. Al‑Nisa 4:153‑‑162. is in response to a provocation by the Jews of Madinah whereby they sought through the Prophet (peace be upon him) the revelation of a book directly from the Heavens exclusively for themselves. Almighty Allah (SWT) did not respond to this absurd demand, but observed that they belonged to the same lot who wanted to see Him during the time of Prophet Musa and then went to disobey Him time and again.? After this, Allah the Almighty recounts the major crimes of the Jews, which invited His wrath on them. In this perspective, the verse 160 and its companion verses 161 and 162 are as follows:-
We (i.e., Allah) decreed many a previously permitted things haram? for the Jews, because: (i) they did zulm; (ii) they stopped others from the Way of Allah in virtually all matters (Al‑Nisa 4:160); (iii) they charged Riba despite being forbidden to do so: and (iv) they ate into the wealth of others without any Shariah justification‑ And, We have prepared a painful doom for these disobedient persons (Al‑Nisa 4:161). However, We will give a great reward to those (among the Jews) who are clear‑minded about the truth, without a grain of doubt, and who believe in the Qur'an and all other Revealed Books, establish Salat, give Zakat and believe in Allah and the Day of Judgment. (AI‑Nisa 4:162).
These verses are self‑explanatory. Though their immediate addresses were the Jews of Madinah, in the general style of the Qur'an they are also meant to bring the likes and dislikes of Allah to the attention of the Muslims.
The third revelation on Riba consists of Aal‑i‑Imran, 130‑‑136. Among these verses, the verse 130 is the principal one, and the remaining six verses reinforce its message. According to the commentators (for example) Maulana Amin Ahsan Islahi Tadabbur‑e‑Qur'an, Vol. 2, pp. 167‑? 234), this passage was revealed after the Battle of Uhad that took place in Shawwal, 3 A.H. These verses are as follows---:
O Believers, don't eat Riba on top of Riba. And, he afraid of Allah so that you may be successful (Aal‑i‑Imran, 130). And, be afraid of the fire of Hell, which is prepared for the disobedient (Aal‑i‑Imran. 131). And, obey Allah and the Messenger (s.a.w.) so that you mad benefit from Allah's Mercy (Aal‑i‑Imran, 1321. And, rush toward the forgiveness of your Lord and the Paradisc whose boundary spans the heavens and the earth; it (the Paradise) is prepared for the Allah‑conscious. (Aal‑i‑Imran; 133).;
?(As to who are the J Allah‑conscious note that) They are the people who spend for the sake of Allah in both good and bad times, who control their temper and who forgive others. Surely Allah holds such mohsineen very dear (Aal‑i‑Imran, 134). Moreover, they are the ones who, in the event of committing any mistake or anything against themselves to remember Allah and seek His forgiveness for their sins. After all, who is it except Allah who can exonerate failings? Furthermore, they are the people who do not insist on their mistakes knowingly. (Aal‑i‑Imran, 135).
They (the Allah‑conscious people) will be rewarded by their Lord with forgiveness and gardens, with streams flowing underneath, to live (forever). This is indeed an excellent reward (waiting) for those who do good. (Aal‑i‑Imran, 136).
This is a commentary on the events of the battle of Uhud and its aftermath. Just on the way to the battlefield, the chief of hypocrites Abdullah Ibn Ubay and his followers deserted the Islamic forces. During the battle too, the Muslims went through extremely trying moments. Allah used this battle to serve three important purposes in favour of this Ummah. First, the isolation of those who harboured ill‑motives towards Islam from the mainstream of the Muslims. Second,, bringing to fore their secret desires and designs by creating a false impression of Islam's vulnerability. And third, identification of the potential sources of weakness in the ranks of the Muslims in order to prepare them for future responsibilities.
In the background of the battle of Uhud the verse 130 and its companion verses can be seen in many ways. These were aimed at inspiring the believers for Jihad and were meant to prepare the Muslims for financial and material sacrifices in connection with Jihad. This was done by first prohibiting Riba which, unlike Infaq, is a materially beneficial proposition for the wealthy. Moreover, it has been noted by some scholars that the disbelievers of Makka used to do Riba‑based business, and they utilized the proceeds of the caravan that came from Syria (on the eve of the Battle of Badr) to finance the Battle of Uhud. In this perspective, Allah the Almighty advised the Muslims to stay away from Riba even if it were to finance a battle against the disbelievers.
There is no doubt that the above purposes were served by these verses; they constituted the formal prohibition of Riba for the Muslims. This point is also confirmed by internal evidence in Surah al‑Baqarah 2:275 in which the Qur'an has used past indefinite tense that bai' (trading) was permitted but Riba prohibited by Him. If one looks for this past decree on Riba, it is in Surah Aal‑i‑Imran 3:130. As to why the prohibition of Riba was revealed immediately after the Battle of Uhud. Following points have been noted:
The Battle of Uhud was preceded by 13 years' effort on faith and character‑building of Prophet's Companions in Makkah, and a similar endeavour for 3 years in Madinah. By the time this battle was over, the Companions had gone through two thoroughly rigorous and demanding tests: one was that of the Battle of Badr (Ramadan 2 A.H.) and the other was the. Battle of Uhud. The credentials of the Companions of the Prophet (peace be upon him) as true believers---who could withstand all temptations and tribulations just for the Pleasure of Allah---were fully established. Islam was to expand after the Battle of Uhad too. More trials were still awaiting the Muslims. But nothing like the tribulations faced by the pioneering Companions were to come in the way of the new sahabah.
In the above background, one may claim that the Madani society was literally purified at the time of Battle of Uhud. Moreover, it was at a critical juncture when unconditional obedience of Allah (peace be upon him and His Prophet (peace be upon him) by the believers could be taken for granted. This was, therefore, the most opportune moment for the revelation of major injunctions calling for staying away from material gains by the believers.
Another equally important factor behind the early prohibition of Riba is as follows. Salat, Saum, Zakat and Hajj were prescribed and perfected during the blessed lifetime of the Prophet (peace be upon him). The problem of Riba with the associated declaration of all‑out war by Allah and His Prophet (Al‑Baqarah 2:279) called for a similar treatment. Elimination of Riba required delineation of the contours of the Islamic economic system while the Prophet (peace be upon him) was among his Companions.
Prohibition of Riba also meant giving way to a radically different system for mutual contracting, especially for mobilizing resources from those with surplus funds to those in need of financial intermediation. Anyone who is familiar with legislation process would confirm that such a monumental task could not be accomplished in a short period. This required sufficient time during which most of the practical problems could come to fore and be satisfactorily resolved by Allah (peace be upon him) and His Prophet. The time‑consuming nature of the job required an early start. In short, the right frame of mind of the Companions and the time required for the building of new institutions may be construed as the main explanations for the prohibition of Riba by the end of 3 A.H, as per Aal‑i‑Imran, 130.
The fourth revelation on Riba consists of Al‑Baqarah 2:275‑‑277. In the text of the Qur'an, these verses are followed by four more verses on Riba, namely Al‑Baqarah 2:278‑281. Generally the commentators of Qur'an discuss all of them together. However, the background and the tone of these verses confirm that in fact the passage AI‑Baqarah 2:275‑‑281 consists of two independent sets of verses revealed on two separate occasions. Before looking at the Qur'anic verses 275‑‑277, it is worthwhile to note an important point in the text of the Qur'an applicable to the entire block of Al?-Baqarah 2:275‑‑281.
In the textual order of the Qur'an, the verses 275‑‑281 are preceded by the most comprehensive set of ayaat on voluntary spending for the sake of Allah (Al‑Baqarah 2:261‑‑274), and followed by a verse containing exhaustive guidelines on loans and credit transactions (Al‑Baqarah 2:282)., In the verses 261‑274. the believers are given compelling. reasons to go all out for Infaq, and the principles and norms for this purpose are prescribed. For example, the believers are told that reward of spending for the sake of Allah is seven hundred times or even more (Al‑Baqarah 2;261; Moreover, spending for the sake of Allah should be free from (a) the quest for personal glory, (b) causing any distress to the recipients, and (c) giving out of unlawful and bad things (Al‑Baqarah 2:262‑‑267). The verses on Infaq close on the following note:
Those who spend their wealth for the sake of Allah day and night, secretly and openly, have their reward with their Lord. They have nothing to fear and nothing to be sorry about. (Al‑Baqarah 2:274).
Among other things, these verses mentally prepare the readers of the Qur'an for the injunctions of Riba in the ayaat 275‑‑281. After this useful digression, let us look at AI‑Baqarah 2:275‑‑277. The background of these verses is as follows.
Riba was prohibited by the end of 3 A.H. according to Aal‑i‑Imran 3:130. This decree clearly affected both taking and giving of Riba on new loans. But it also had implications for Riba on the then existing debts. The Companions never missed any opportunity for immediate, unconditional and total obedience of Allah and His Prophet. Therefore, it is certain that soon after the decree of Surah Aal‑i‑Imran, they beseeched additional guidance about Riba on the existing debts. And, given the level of their Taqwa, it is quite likely that some Companions also approached the Prophet (peace be upon him) with queries about the Riba charged in the past.
Another significant factor at the time was the role of the Jews who used to deal in Riba (Al‑Nisa 4:161). They were part and parcel of the Madinan society when the Prophet (peace be upon him) migrated to Madinah. There were three Jewish tribes in Madinah: Banu Qainqa', Banu Nudair and Banu Quraizah. They dominated the civic and economic life of loans. The Jews had their reservations about Islam. First friction and then hostilities followed. This to the expulsion of Banu Qainqa' toward the Syrian territories in Shawwal, 2 A.H. Banu Nudair were exiled to Khyber, about 200 miles from Madinah, in Rabi al‑Awwal 4 A.H. and Banu Quraizah were penalized in Zi Qa'adah 5 A.H. for their role in the Battle of Ahzaab (Shawwal 5 A.H.). This was followed by the Battle of Khyber in Muharram. 7 A.H.. This sequence of events implies that one section of the society actively resisted the rise of Islam in Madinah at least until 7 A.H. Of course, it had the sympathies of the munafiqeen, the other group in Madinah with nefarious intentions towards Islam.
By the end of 3 A.H, Islam had taken a clear‑cut stand against Riba. One can see that the vested interests went on a counter‑offensive, both because of the fear of losing their clientele and because of their grudge against Islam. Issues like mixing up of Riba (on a sum lent) with profits (on trading using the same money) can be seen as part of the propaganda. Those who understand the nature of psychological warfare would confirm that any propaganda campaign works while the issue is still fresh in the minds of the people. Thus, the circumstantial evidence suggests that as soon as Allah forbade Riba (as' per Aal‑i‑Imran), Jews and their sympathizers in Madinah launched a war of attrition against Islam. In the above background, the verses 275‑‑277 read as follows:
Riba‑eaters will get up on the Day of Judgment like someone driven to madness by the devil with his evil touch. This will happen because of their claim that (profit on) bat' (trading) is the same as Riba whereas Allah has permitted bat' but prohibited Riba.
Whoever received the advice from his Lord (as per Aal‑i‑Imran 130) and (hence) stayed away from Riba, his matter is with Allah as far as Riba charged in the past is concerned. That subject should be treated as closed in this world. However, all those who continue to charge Riba in lieu of the outstanding debts, they belong to the Hell where they shall live. (Al‑Baqarah 2:275).
Allah mitigates Riba and multiplies sadaqaat. Surely, Allah does not like any thankless, sinner (Al‑Baqarah 2:276).
Verily, those who are believers and who do good deeds, establish Salat and discharge Zakat obligations, they have their reward with their Lord. They have nothing to fear or to be sorry about. (Al?Baqarah 2:277).
The verse 275 has both a comment on the doubts raised about the nature of Riba and some guidelines for action in lieu of Riba on existing debts. The issue drawing the most attention of the people is addressed first.
Those favouring Riba rested their case on Riba being no different from profits on bat' (trading). But in order to give a punch to their claim and to ridicule the injunctions of Allah, the provocateurs changed the order of comparison, and contended: "Bat' is like Riba." As in the case of repeated challenges from disbelievers about the timing of Qiyamah, Allah did not directly respond to this provocation. He just observed that bat' was permitted and Riba prohibited.
The said observation is also a polite reminder for all concerned that what matters in the case of Riba is not return (or the rate of return) on one's money, but the form of the transaction. One form (i.e., trading) is permitted, but the other (i.e., interest‑based loans) prohibited. This being so at the discretion of Allah.
Both trading and loans carry risk ‑ trading risk in one case, but commercial credit risk (of borrowing) in the other. Time too is not critical, because loans may also have a very short duration. Overnight lending in international financial markets is an example. Nonetheless trading involves a heterogeneous exchange: money versus some goods, for example. On the other hand, a loan represents a homogeneous exchange. That is, in this case the items given and taken back belong to the same category. Furthermore, the transfer of ownership in a loan is only for the pendency of the loan, and the lender is not a legal party to the use of the object lent at the borrower's end. The nature of the exchange and these legal dimensions distinguish loans from other transactions. Thus the injunctions of Riba prescribe the principles according to which loan transactions are to be executed.
As noted earlier, the point "Allah has prohibited Riba" in verse 275 confirms that absolute prohibition of Riba did take place before this verse. The verse 275 goes on to give some guidelines for the "elimination of Riba" from the economy. These include the abolition of Riba clauses from the then existing contracts. The choice of words by Allah signifies two things. First, once the Riba decree (Aal‑i‑Imran 3:130) was given, all Riba calculations had to stop forthwith. Secondly, those wilfully charging Riba are promised an abode in the Hell because of their denying the absolute and authoritative status of the Qur'an.
After the above point, Allah, Who created man and Who knows his psyche, emphasizes some negative dimensions of Riba and positive aspects of sadaqaat. This is the focus of the ayah 276. How do Riba and spending for the sake of Allah affect the life at individual and national levels? A detailed account of this issue requires a separate study. However, one point may be just mentioned here in order to inspire some thinking on the subject. From economics point of view, Riba discourages investment and hence curtails economic development. On the other hand, sadaqaat enhance aggregate demand and hence augment economic activity.
The message is completed in the ayah 277 by drawing the attention of the creation of Allah to the road to ultimate success having Iman, doing good deeds in general, and establishing Salat and Zakat in particular.
The fifth and the last revelation on Riba consists of Al‑Baqarah 2:278‑‑281.. These verses have a background. Its proper appreciation is essential both for the correct understanding of these verses as well as for avoiding any questionable propositions about Riba.
The above verses can be put into a proper perspective by first noting that, with the revelation of Aal‑i‑Imran 3:130 and Al‑Baqarah 2:275‑?277 in the Qur'an, the necessary legislation on the subject of Riba was complete. And this happened toward the end of 3 A.H. These verses are with reference to loan transactions. This point is also confirmed by Al-Baqarah 2:279. As explained elsewhere, the above decrees also called for further action in order to bring other exchange practices (comparable in nature to loan transactions) in line with the Qur'anic commandments. This purpose is served by the guidelines prescribed by the Prophet for trading practices. The Ahadith of Hazrat Fudalah Ibn Obaid, with a mention of the Battle of Khyber, confirm the existence of such injunctions in Muharram, 7 A. H.
There was nothing unusual about the practice on the above injunctions. All the Prophet's Companions observed them. If, however, someone unwittingly made a mistake and it came to the attention of the Prophet (peace be upon him), he would simply correct the error. Everything was normal until after conquest of Makkah, which took place on 20th Ramadan, 8 A.H.
The conquest of Makkah was followed by the Battle of Hunain on 6th Shawwal, 8 A.H. Immediately thereafter, Banu Thaqeef were besieged in Taif by the Islamic forces. The siege lasted for two weeks. The Prophet (peace be upon him) did not press for military defeat of Bani Thaqif. He returned to Madinah, via Makkah, after appointing Attaab Ibn Usaid as Governor of Makkah.
In Ramadan 9 A.H. a delegation of Banu Thaqif visited Madinah with Abdyaleil as its head. The delegation presented several demands for embracing Islam. One of these was permission for business involving Riba. The Prophet (peace be upon him) did not grant this request. Though some of them did embrace Islam, the delegation itself returned after concluding a general peace agreement with the Prophet (peace be upon him). Banu Thaqif gradually entered the fold of Islam, and all of them became Muslims by the Last Pilgrimage in Zil Hijjah, 10 A.H.
The incident leading to the revelation of verses 278‑‑281 involved Banu Amr Ibn Umair ‑ a Thaqeef family ‑ and Banu Moghirah a family of Banu Makhzum of Makkah. The following details are provided by Allama Badruddin Ayni in Umdatul Qari: Sharah Sahih al‑Bukhari:
"Zaid bin Aslam, Ibne Juraij, Muqatil ibn Hayyan and Suddi reported as follows, The verse 278 and its related verse were revealed in the context of a controversy between Bani Amir bin Omair of Bani Thaqif and Bani Al‑Moghirah of Bani Makhzoom. It also happened that Bani Amr and Bani AI‑Moghirah had some Riba deal between them during the days of Jahiliyyah (i.e., before embracing Islam). When the time of maturity of the said deal came, Bani Amr of the Thaqif's demanded Riba. There was a heated argument. Bani Al‑Moghirah refused to pay Riba on the ground that it was abolished by Islam. The matter came before Sayyidena Attaab bin Aseed, the Governor of Makkah. He sent a written request to the Prophet (peace be upon him), who was then in Madinah, for a decision. Thereupon the verses under reference were revealed. The Prophet (peace be upon him) clearly forbade them from receiving any excess money due to them on account of interest. Upon hearing Prophet's judgment, Bani Amr said: `We turn toward Allah, and give up the Riba due in our favour'. Thereafter, all of them gave it up."
According to Tafsir‑e‑Mazhari (Urdu, Vo1.2, p. 105), Abu Y'ala reports the above incident in his Masnad on the authority of Kalbi and Abu Saleh; the latter attributed his narration to Abdullah ibn Abbas. Qurtubi (Tafsir Al‑Qurtubi, Vol. 3, p. 363) also reports this incident with reference to Ibn Ishaq, Ibn Juraij, Suddee and others. In the narrations of Abu Y'ala and Qurtubi, Bani Amr are said to rest their case on a permission from the Prophet (peace be upon him) whereby Banu Thaqif were allowed to continue to charge Riba in return for becoming Muslim. As noted above, this was not the case. This is also unlikely for the following reasons.
Banu Thaqif signed their peace agreement in 9 A.H, the same year in which Prophet (peace be upon him) concluded another pact with the Christians of Najran. This latter treaty explicitly requires discontinuation of Riba practices by the people of Najran as a condition for peace. It, is noteworthy that the Christians of Najran did not embrace Islam. Banu Amr are addressed as Muslims in Al‑Baqarah 2:278. Acceptance of Islam automatically brought them under the purview of the Qur'anic Injunctions on Riba. There is not a single instance in which the Prophet (peace be upon him) exempted Muslims from an order in the Qur'an. In view of this to say the least, the insistence of Banu Amr must have been caused by a lack of their knowledge of al‑Baqarah 2:275, and not on the basis of some sort of permission from the Prophet (peace be upon him).
It is also pertinent to note that the embracing of Islam by Hazrat Attaab and his appointment as Governor of Makkah by the Prophet (peace be upon him) occurred almost at the same time. He was then 21 or 22 years of age. One may argue that he too was unaware of the injunctions of Riba. in al‑Baqarah 2:275‑‑277. But given the trust which the Prophet (peace be upon him) placed in him, and given that there must also have been other Companions in Makkah at that time, this point is not tenable. The most likely explanation for Hazrat Attaab's action is that the parties involved in the dispute were heavy‑weights, and he deemed it appropriate to seek a resolution of the matter by the Prophet (peace be upon him) in order not to spark any tribal conflict between the people of Makkah and Banu Thaqeef.
Notwithstanding minor differences in details, quite a few sources leading to the same information and a general consensus among many respected mufasserin on basic points confirm that the reported incident did happen in late 9 A.H. or early 10 A.H. The words in all narrations imply that the Prophet (peace be upon him) wrote to Attaab Ibn Usaid. This must have happened before the 25th Zi Q'adah, 10 A.H. when the Prophet (peace be upon him) left Madinah for Hajj-al‑Wida'.
On 9th Zil Hijjah, 10 A.H., the Prophet (peace be upon him) decreed, in person, the abolition of Riba on all of the then existing debts. This was a retrospective decree. Thereafter, the Prophet (peace be upon him) lived in this world for only 81 days. The said announcement was made in the presence of the Companions gathered in Arafat from all over Arabia. With the status of Riba on existing debts fairly recently coming into the knowledge of virtually everybody, there was hardly any need for making references of the above nature to the Prophet (peace be upon him). Therefore, it is quite unlikely that any need for intervention by Allah arose after the Hajj al‑Wida'. One may, therefore, conclude that the time of revelation of the ayaat under reference is after the conquest of Makkah but before the last pilgrimage. The verses 278‑‑281 are as follows:
O believers, fear Allah and give up whatever is left in lieu of Riba if you are indeed believers. (Al‑Baqarah 2:278).
Watch out! If you do not obey this order (and give up all outstanding Riba), then there is a declaration of war against you from Allah and His Prophet. However, if you do tawbah (Le repent, along with the resolve to make amends for past mistakes), you have right only to your principals. Neither you inflict zulm on others, nor the others should do zulm on you. (AI‑Baqarah 2:279).
In the process of settling any outstanding accounts, if you find the debtor in a tight situation, give him some grace period so that he can manage to clear the dues against him. However, if you consider converting the outstanding debts into sadaqah (charity), that would be better for you if you understand. (Al‑Baqarah 2:280).
And be afraid of the Day on which you will be returned to Allah. At that time everyone will be fully rewarded for his actions, without being subjected to any zulm. (Al‑Baqarah 2:281).
The tone of the address confirms that.‑something happened which annoyed Almighty Allah, Who is also the Owner, Master, and Sustainer of the universe. As explained above, this was indeed the case. 1'he closing words of the verse 278 make it plain that Riba is an offence of unimaginable proportions, and Almighty Allah simply does not recognize any person as a believer unless he gives up Riba.
While the first part of the verse 279 warns of the dire consequences of not giving up Riba, the second part is also significant. The creditors arc pointedly restricted to their principals while settling any existing debts. According to verse 280, if the debtors face genuine difficulties in meeting their payment obligations, the creditors are ordered to give them grace period to meet their payment obligations to the tune of the principal. This principle was already observed by the veteran Companions after the revelation of Al‑Baqarah 2:275 in late 3 A.H. But now the decree from Allah formalized it. This may be viewed as His special favour for this Ummah. More and more people were going to enter the fold of Islam in the future. Settlement of old contracts which involved Riba by the new converts to Islam could create social problems. This verse forestalled such problems. The ayah 280 also contains an additional guideline about the treatment of the written‑off loans. They are to be treated as sadaqah by the lenders. Whereas the verse 279 restricts lenders to their principals, it also closes on the following note: Neither the creditors do zulm on the debtors nor the latter do zul?t on the former. The link between charging Riba by creditors and Zulm is often easy to understand. But how does zulm arise on the debtors' side? The Ahadith of Hazrat Abu Hurairah clarify that debtors commit zulm when they deliberately cause delays in meeting their payment obligations.
Most of the commentators of the Qur'an interpreted the point about zulm to conclude that genesis of Riba is zulm. Hence, they went on to rationalize the prohibition of Riba. Many reasons are offered. In the case of consumption loans, lending on interest is equated with exploiting the needy In the case of production or commercial loans, it is suggested that Riba gives the capitalist an opportunity to enjoy the fruits of the borrowers' effort without either putting in any effort of his own or taking any risk. Some others have used this ayah to defend their case for indexation of loans for inflation (in order to compensate lenders for loss in the purchasing power of their loans). Respectfully, both lines of interpretation take the meaning of the ayah out of the context. The factual position is as follows.
Actually the verse 279 contains an order from Allah that both creditors and debtors should avoid zulm. Technically speaking, zulm occurs when any party is denied its rights as per the Injunctions of Shariah. Thus the question one needs to ask is: what were the (relevant) Injunctions of Shariah, from the creditors' and the debtors' perspectives, at the time of revelation of al‑Baqarah 2:278‑‑281? Quite clearly, these injunctions are given in Aal‑i‑Imran 3:130 and AI‑Baqarah 2:275‑‑277. On both these previous occasions, there is no mention of zulm or its equivalent. Therefore, when Allah decrees that both creditors and debtors avoid zulm, it means adherence to the said injunctions, and nothing else.
The above conclusion has significant implications for guiding the thinking on Riba. First, Riba may lead to zulm, but zulm per se is not the reason behind its prohibition. Second, there is no room for generalizing the interpretation of "lender's principal" in order to seek a compensation for decline in the value of loans due to inflation during their pendency.
In order to understand the true spirit of gradual prohibition of Riba, it is necessary that all the relevant verses of the Qur'an are seen in a chronological order. A look at these verses would clearly show, as rightly noted by the participants of the IIIE workshop, that the process of the elimination of Riba during the time‑of the Holy Prophet (peace be upon him) had the following features:
(i)???????? Riba was formally prohibited with a directive for the believers in Aal‑i‑Imran 3:130, in late 3 A.H.‑ soon after the Battle of Uhud. Notwithstanding the linguistic style of this decree, the prohibition of Riba was absolute, regardless of whether the transactions were for satisfying personal or business needs and whether Riba was simple or compound.
(11)????? The above decree left no doubt about the status of the new Riba-?based contracts. However, two issues arose: (a) the status of the existing loans and debts, and (b) a need for review of all existing exchange practices in order to bring them into line with the Qur'anic decree on Riba.
The issue of the then existing loans and debts was tackled with a directive from Allah in al‑Baqarah 2:275. The believers were ordered to honour the relevant contracts after deleting the Riba clauses in them while ignoring Riba already charged or given. The unmistakable message was that the switch‑over to a Riba‑free State, in respect of the existing loans and debt, has to be instantaneous. No gradualism was allowed.
As to the issue of rationalizing other exchange practices, there was the case of trading with, generally speaking, homogeneous items of both ends of the exchange. This happened, for example, when a party had gold in the form of pieces, ornaments or crockery and. the other had it in the form of Dinars. Likewise, among other things, there was the question of trading dates of one variety for those of another. Technically speaking, these were special cases of loan transactions with no time lag in the give and take back process. Thus, when lenders were called upon to concede all costs associated with loan transactions, it put a question mark on the permissibility of unequal exchanges in the aforementioned and similar other cases. Therefore, in order to bring the said trading transactions into line with the Qur'anic Ahkam, the Holy Prophet (peace be upon him) also took steps and prescribed rules for trading exchanges. The Ahadith of Fadalah bin Ubaid confirm the existence of such instructions in Muharram 7 A.H. In other cases, one cannot be definite because no event of a historic significance is mentioned in the texts of the Ahadith. However, the following two things support the contention that the Prophet (peace be upon him) gave the necessary Ahkam quite early after the prohibition of Riba in 3 A.H:‑‑
First, given the seriousness with which Allah views dealing in Riba (al‑Baqarah 2:278‑279), it is inconceivable that any necessary legislative action was delayed. Second, texts of the various Ahadith on Riba have internal evidence to support the above view. Hazrat Ubadah ibn Samit was incharge‑cum‑instructor of the first teaching institution of Islam established by the Holy Prophet (peace ,be upon him) for the residents of Suffah, a raised platform in the Masjid of the Holy Prophet (peace be upon him). His narrations on the subject are by far the most comprehensive, and their tone and tenor unmistakenly authoritative. Against the background of his narrations, it is easy to see that the aforementioned narrations of Hazrat Fadala have an "explanatory" character. This is, while trading of gold for gold on unequal terms was forbidden much earlier, as in the Ahadith of Hazrat Ubadah, the scope of the proviso "gold for gold" was not equally clear to all the Companions of the Holy Prophet (peace be upon him). Thus, a need for clarification arose on the eve of the Ghazwah of Khyber in 7 A.H. which the Holy Prophet (peace be upon him) made ‑ as reported by Hazrat Fadalah..
(iii) With the revelation of al‑Baqarah 2:275 and the enforcement of the adjunct guidelines, as above, by the Holy Prophet (peace be upon him), the process of the elimination of Riba was officially completed. However, sometime in late 9 to 10 A.H. but before the departure of the Holy Prophet (peace be upon him) for Hajja‑tul? Wida', some new Muslims sought exception to the Ahkam in lieu of their outstanding debt claims. The matter was referred by Hazrat Attaab bin Aseed, the then Governor of Makkah, to the Holy Prophet (peace be upon him) in Madinah. Thereupon al‑Baqarah 2:278‑‑281 were revealed. These ayaat not only confirmed the above Ahkam but also warned of retribution against those who hesitated to close the chapter on Riba. This decree also explicates? some additional, though not fresh, guidelines for the elimination of Riba. That is, while the lenders were restricted to the principal in lieu of their existing claims in al‑Baqarah 2:279, in very next ayah they were ordered to give grace period to the debtors to meet their payment obligations to the extent of the principal; however, any written‑off loans were to be treated as sadaqah (charity). This decree just formalized what was already in practice among the veteran Companions of the Holy Prophet (peace be upon him) since the revelation of al‑Baqarah 2:275.
The background of al‑Baqarah 2:278‑‑281 also raises some questions. Was there not gradualism in the process of the elimination of Riba from the then Islamic economy? That is, was it not the case that the said process officially started toward the end of 3 A.H. but completed, albeit gradually, sometime in 9 or 10 A.H? In particular, was it not that the formal completion of this process coincided with the abrogation of the Riba claims of Hazrat Abbas, among others, by the Holy Prophet (peace be upon him) during Hajja tul‑Wida' 10 A.H? The answer to these points in favour of the gradualism thesis is "no" for the following reasons:
(i) One must differentiate between the enforcement of a law and its violations. The latter may take place after the enforcement of the law, and this is where the law comes into picture. The incident behind the revelation of the verses 278‑‑281 falls in the category of violation of the then existing law. The unique thing about this case was that it was referred to the Holy Prophet (peace be upon him), the supreme legal authority at the time, and settled by a decree from Allah.
(ii)??????? Indeed, the Holy Prophet (peace be upon him) declared annulment of RIM claims of Abbas, among others, in Zul Hijjah 10 A.H. But it is wrong to conclude that Abbas or any other Companion of the Holy Prophet (peace be upon him) continued to charge Riba as a Muslim despite its prohibition. This point may be seen as follows:
When the Holy Prophet (peace be upon him) made the said announcement, it was the third of three declarations made by him, at that time. The first was about the prohibition of unlawfully killing someone or depriving him of his property, and the second was about the revocation of blood claims dating back to the days of Jahiliyyah (Ignorance)‑the pre‑Islamic period. In lieu of the second, the Holy Prophet (peace be upon him) also specifically mentioned the annulment of blood claims of his family, Banu Hashim, in lieu of the murder of infant Ibne Rabi'ah that took place before the dawn of Islam. These two decrees have never been taken to conclude, and rightly so, that the murder of innocent people was either allowed or condoned before these decrees were made in late 10 A.H. Moreover, the factual position is that Banu Hashim never claimed retribution for the murder of Ibne Rabi'ah after the conquest of Makkah in 8 A.H. the time when all of them came into the fold of Islam. The position about Riba claims of Hazral Abbas is likewise. Technically speaking, like the other two decrees of the Holy Prophet (peace be upon him), this too was a retrospective decree. As with the other two decrees, its significance lay in pressing home the message on a few sensitive matters where emotions could prevail and disturb the harmony of the Ummah later on.
(iii) The Ahkam of Riba are not different from the Ahkam of, for example, salah (prayer) and saum (fasting). The Ahkam for none of these were prescribed with the dawn of Islam. However, once ordained, the relevant Ahkam were enforced at once. As to those becoming Muslims, later on, there was and there is no choice but to initiate all 'relevant' and, of course, 'possible' steps at once.
(iv) The analogy of Sulah Hudabiyah (the Peace Treaty signed at Hudabiyah) cannot be invoked to take a lenient position on the elimination of Riba. This is because the said treaty was between the Muslims and non‑Muslims while today in a Muslim country the issue pertains to dealings among the Muslims or their transactions with non‑Muslims. In passing, one may note that in the case of Pakistan many target dates for the elimination of Riba have come and gone during the last five decades without any result. Thus, "gradualism" has already lost its meaning, and it cannot be on the agenda any more.
(v)??????? No doubt the Holy Prophet (peace be upon him) took a lenient view of the request of the tribe of Thaqeef on the payment of Zakah when the latter negotiated with him, the terms for entering into the fold of Islam. But again any conclusions in respect of Rlba are unwarranted for two reasons. First, the Thaqeefs were not given exemption from the payment of Zakah as Muslims. In fact, the entire tribe did not become Muslim when their delegation presented the said demands before the Holy Prophet (peace be upon him). The Thaqeefs embraced Islam over a period of two years after their delegation's visit to Madinah. Second, while the delegation made the above demand about Zakah, it also sought exemption from the Ahkam on Riba. But this latter demand was categorically rejected by the Holy Prophet (peace be upon him).
(vi)?????? Finally, the case of khamr (drinking) cannot be cited as an example to justify gradualism in the elimination of Riba for the following reason. In that case, the Muslims were first told to stay away from drinking at the time of salah, and later on ordered to give it up entirely‑ In the case of Riba, the very first directive to the Muslims (Aal‑i‑Imran 3:130) prescribes its absolute prohibition.
Riba has been dealt with in the Hadith literature very extensively and the Holy Prophet has thrown light on every significant aspect of it. He declared it to be one of the most heinous crimes and sins. He condemned and cursed those who eat Riba, who pay it, who prepare its document and who attest it as a witness. In a Hadith he said that a single Dirham eaten by a person by way of Riba exceeds in its heinousness and wickedness the commission of the most obnoxious crime of connotting incest with one's own mother thirty‑six times.
Apart from the Riba al‑Nasiah which was in vogue in pre‑Islamic Arabia and clearly and expressly prohibited by the Qur'an, the Prophet took several preventive measures to close all the possible avenues which may in any eventually lead to the commission of the Riba par excellence. This preventive Riba is called by different names. It is called Riba al‑Hadith because it has been mentioned in the Hadith as against Riba al‑Nasiah which is called Riba al‑Qur'an. It is also called Riba al‑Buyu because it is mostly applicable in contracts of sale or exchange of property, as against Riba al-?Duyun, i.e. Riba payable on debts. It is also called Riba Khafi or Tacit or
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mithlin (like for like) and yadan‑bi‑yadin (hand to hand or on spot) basis. Thus, whosoever gave more or demanded more, verily he dealt in Riba. Both the taker and the giver are equal ?i.e., equally guilty‑in this regard." (Muslim, 2971).
(xii)????? Ubadah b. Samett (r.a.a.) directly reports the Prophet (peace be upon him) as saying: "Buy and sell gold for gold, silver for silver, dates for dates, wheat for wheat, salt for salt and barley for barley on the mithlan‑bi‑mithlin (like for like) basis. Whosoever gave more or took more, verily he made a Riba deal. However, trade gold for silver as you wish subject to the condition that the exchange be yadan‑bi‑yadin (on spot). Trade wheat for dates or barley for dates also likewise," (Tirmizi, 116).
(xiii)????? This narration is from Abu Qilabah. He told that he was sitting in Syria in a circle that also included Muslim bin Yasar. There came Abul Ash'ath. According to Abu Qilabah, everybody exclaimed: "Abul Ash'ath!" Abul Ash'ath joined the circle. Abu Qelabah asked him to narrate the Hadith of Ubadah b. Samett (r.a.a.) for a brother there. Abul Ash'ath agreed. His narration is as follows:
We (i.e., Abul Ash'ath and his colleagues) were on a military mission under the command of Mo'aawiyah (r.a.a.). We gained a lot of spoils of war. Among them, there was a silver utensil. Mo'aawiyah directed a person to auction it against the salary due in favour of the soldiers. People showed great interest in the auction. When the news reached Obadah bin Samett, he stood up and said: "I heard the Prophet (peace be upon him) forbidding the sale of gold for gold, silver for silver, wheat for wheat, barley; for barley, dates for dates and salt for salt except on sawa'amm‑bi‑sawaa' (equal) and ainamm‑be‑ain (like for like) basis. The Prophet (peace be upon him) further said that if someone gave more or took more, he entered into Riba." As soon as the people heard this, they withdrew from the auction. When the news reached Mo'aawiyah, he got up and addressed the people as follows: "What is the matter with the people that they attribute to the Prophet (peace be upon him) the Ahadith that we did not listen even though we also saw the Prophet (peace be upon him) and kept His company?" Obadah stood up and repeated the whole thing. He then angrily said: "We will narrate what we heard from the Prophet (peace be upon him) even though it might be unpleasant for Mo'aawiyah (or, he said: even if it is against the will of Mo'aawiyah)." Obadah further said: "I don't care even if it (i.e., contradicting Mo'aawiyah) costs me my stay with Mo'aawiyah's army on this very dark night." (Muslim, 2969).
(xiv)???? This narration is from Fadalah b. Ubayd (r.a.a.). He said that he and other companions of the Prophet (peace be upon him) were with Allah's Messenger on the eve of the conquest of Khyber. They were trading one wuqiyyah (=7 mithqal) of gold for two or three Dinars with the Jews. When this came to the notice of the Prophet (peace be upon him), He ordered: "Don't trade gold for gold except on the basis of waznan‑bi‑waznin (equality in terms of weight)."
(xv)????? This narration is from Fadalh b. Ubayd al‑Ansari (r.a.a.) who reports as follows: When the Prophet (peace be upon him) was in Khyber, a gold necklace studded with precious stones was brought to him (peace be upon him). This necklace, a part of the war booty, was up for sale. The Prophet (peace be upon him) ordered that gold content of the necklace be separated from the rest. Thereafter, the Prophet (peace be upon him) directed that the gold (of the necklace) be sold for gold on the basis of waznan‑bi? waznin (equality in weight). (Muslim, 2978).
(xvi)???? This Hadith is narrated by Ma'mer b. Abdullah (r.a.a.). He said that he used to hear the Prophet (peace be upon him) as saying: "Exchange meal for meal mithlan‑bi‑mithlin (like for like)." (Muslim, 2982).
(xvii)???? This Hadith is narrated by Abdullah b. Amr (r.a.a.). Allah's Messenger (peace be upon him) directed him to make provisions for the army. When Abdullah ran out of camels, the Prophet (peace be upon him) asked him to acquire camels against those of zakah. Accordingly, Abdullah acquired one camel for two camels to be paid from the future zakah proceeds. (Abu Daud, 2913).
(xviii)??? According to Samurah (r.a.a.), the Prophet (peace be upon him) prohibited trading of animals for animals on credit. (Tirmizi, 1158).
(xix)???? This Hadith is from Ibn‑i‑Umar (r.a.a.). He reported that he used to sell camels in the market of Baqi' for dinars (gold coins) but received payment in dirhams (silver coins). He went to see the Prophet (peace be upon him) in the house of Hafzah (r.a.a.h.), wife of the Prophet (peace be upon him), in order to inquire about the validity of his practice. He said: "O Prophet of Allah! With all due respect, I want to know the Shariah position of my trading of camels in Baqi' whereby I sell camels for dinars but accept dirhams towards payment." The Prophet (peace be upon him) said: "There is no problem if you accept the payment in the form of dirhams provided that it is according to the exchange rate (agreed) at that time and that the transaction is fully settled i.e., payment also cleared‑before both you and your client part company." (Nasa'i, 4506).
(xx)????? This Hadith is narrated by Anas b. Malik (r.a.a.). He reported that Allah's Messenger (peace be upon him) said as follows: "If someone among you lends something to another person, the former should not accept from the latter any gift or a ride except when both have such dealings between them before the loan." (Ibn‑i‑Majah, 2423).
(xxi) ??? This Hadith is by Saeed b. Abi Burdah (r.a.a.), who reported it from his father. When the latter came to Madinah, he met Abdullah b. Salam (r.a.a.) who said to him: "You (i.e., Abu Burdah) come from a land where Riba is common. If you have a claim against someone, don't accept from his anything‑be it some sickle, barley or grass‑because that would be Riba." (Bukhari 3530).
(xxii)???? This Hadith is reported by Abu Qatadah (r.a.a.). He said that a person inquired from the Prophet (peace be upon him) as follows. If that person was killed in the path of Allah while he remained steadfast self‑critical and moved forward in the way of Allah without ever turning his back, would Allah forgive his sins? Allah's Messenger (peace be upon him) answered in the affirmative. However, when that person was leaving, the Prophet (peace be upon him) called him back, and said as follows: "Yes, all sins would be forgiven except outstanding debt. This is what Jibrail has told me." (Muslim, 3497).
(xxiii)??? This Hadith is narrated by Amr b. Shareed on the authority of his father who, in turn, reported it from the Messenger of Allah. The Prophet (peace be upon him) said that delay in the repayment of debt by a person, who can afford to repay, legitimizes dishonouring him and punishing him. (Abu Daud,' 3144).
(xxiv)??? This Hadith is reported by Abu Hurairah (r.a.a.). The Prophet (peace be upon him) said as follows: "If a person is in a position to meet his debt obligations but delays repaying the debt (as per schedule), he is zalim (one who commits zulm). If someone is referred by the creditor to a malie' (a debtor who is willing to pay back the debt but cannot afford to do so at the moment), that person should accede to the request." (Bukhari, 2125).
The nutshell of these Ahadith is that the exchange of gold with gold, silver with silver, dates with dates, wheat with wheat, barley with barley, salt with salt should take place only when both the commodities are fully similar and exactly equal to each other in terms of weight and measure and are delivered and received then and there hand by hand. Any increase or decrease on either side or any deferred payment or delivery will render the transaction as Riba‑based and will be disallowed. There has been a consensus among the Muslim jurists about the prohibition of Riba al‑Fadl right from the days of the companions. There are reports about two companions namely Abdullah ibn Umar and Abdullah ibn Abbas who did not initially hold this view because they either were not aware of the prohibition of such transactions or interpreted the prohibition differently. Their counter‑rulings are found in some Hadith books but it has been established about Ibn Umar that he had reviewed his earlier position and joined the consensus when he came to know about the Ahadith prohibiting Riba al‑Fadl. The same thing is reported about Abdullah ibn Abbas. It has been narrated by Imam Hakim that when the companion Abu Said Khudri (who is one of the main narrators of the Ahadith on the prohibition of Riba al‑Fadl) informed him about the Hadith on this subject he immediately changed his view and started vehemently opposing it. It seems that he was initially mistaken about the real meaning of another Hadith reported on the authority of Usamah by Bukhari and Muslim that the Riba is in deferred payments (Nasiah). Companions and jurists have differently interpreted the Hadith of Usamah. The well known authority on Hadith and the leading commentator of Bukhari, Allamah Ibn Hajar Asqalani says that there is no doubt about the soundness and validity of the Hadith of Usamah; yet there is a difference among the Ulema as to how it is to be reconciled with the Hadith of Abu Said. Some say that the Hadith of Usamah (being of an earlier period) is abrogated. But Allamah Ibn Hajar dismisses this view by saying that abrogation cannot be proved by mere possibility. Some scholars are of the view that the wording. "There is no Riba except in Nasiah" simply means that the worst, the most heinous and the most strongly prohibited Riba is the Riba on deferred payments. This is similar to the Arab style of saying that there is no scholar in the city except so‑and‑so. It does not mean that there are no scholars in the city at all. It simply means that there is no scholar of that calibre and perfection, and hence it is not a negation of the existence of any scholar ab initio Moreover, the negation of the prohibition of Riba al‑Fadl on the basis of the Hadith of Usamah is only by way of indirect inference while the Hadith of Abu Said is clear and express and therefore will have preponderance over the former. However, the fact that Ibn Abbas and Ibn Umar had abandoned their earlier point of view and had agreed to the general consensus on the prohibition of Riba al‑Fadl has closed the door for any further discussion on the grounds and implications of this initial and short‑lived difference of opinion. Imam Shawkani has quoted a report from Ibn Abbas to the effect that his earlier ruling was based on his own personal opinion and when he heard Abu Said Khudri narrating the Hadith of the Messenger of Allah he abandoned his opinion and surrendered to the Hadith. It may be pointed out that the narrators of the Ahadith on the prohibition of Riba al‑Fadl include more than two dozen companions leading among them being Abu Bakr, Umar, Usman, Anas and of course Abu Said Khudri.
In the popular version of the Ahadith on Riba al‑Fadl, six commodities have been mentioned as quoted above. Yet, in another version, a companion Mamar ibn Abdullah reports that he used to hear the Prophet (s.a.a.w.) as saying: "Food for food (should be purchased) equal for equal." He further reports that to those days their popular food was barley. In yet another version, Ubadah and Anas, the two leading companions, report that the Prophet has said "What is weighed is to be equal for equal as long as it is one and the same kind of commodity. Likewise is the case of what is measured. But if the two kinds are different then there is no harm (if it is sold differently.)"
These last two versions quoted by Imam Ahmed and Muslim and Darqutni respectively clearly establish that the common ground in all the above commodities is weight and measure, i.e. their fungibility: Thus, all fungible or nithli commodities shall be subject to the prohibition of Riba. We shall, however, revert to the subject of fungible and non‑fungible kinds of property at a later stage. The general principle is that the exchange of a fungible commodity with the same commodity is allowed only if both the commodities are of the same quantity and are delivered then and there. But if the commodities are different, these may be sold with a difference in quantity as long as delivery is immediate. On the other hand, Imam Shafi'i has a slightly different view. He agrees with Imam Abu Hanifah in respect of silver, gold and cash but limits the application of the prohibition of Riba to only those commodities which are either edible or are common in their genus. The rest of the fungible items even if they are weighable cannot be included in the same category of prohibition with gold and silver. In support of his ruling to consider edibility as a deciding factor, he relies on the Hadith dealing with food for food quoted above. Imam Malik also has the same view as far as gold and silver are concerned. In respect of other items he considers fungibility and edibility as the Illah or ratio decidendi. However, the last‑mentioned Hadith clearly supports the point of view of Imam Abu Hanifah that the prohibition applies to all fungible items. However, the discussion on this kind of Riba in so far as it relates to fungible commodities other than silver, gold, cash and currency is outside the purview of bank interest. For our purpose in the present discussion, it is relevant only to the extent of gold and silver, i.e. cash and currency, as far as it relater to banking and other monetary transactions.
It appears from a Tradition reported by Bukhan and Muslim and other traditionists on the authority of Abu Said Khudri that the tendency of Islam is to encourage monetary transactions as far as possible and to limit the scope of barter dealings to the minimum required. According to this tradition, the Messenger of Allah appointed a person on some assignment in Khyber (perhaps as a collector of revenues and Zakat). He brought dates of good quality. The Messenger of Allah asked him: "Are all the dates of Khyber like this one?" The man replied: "In fact we purchased one measure of these dates for two or two of these for three other kinds of dates: The Prophet declared it to be Riba, revoked the sale and forbade the person from doing it. He advised the man to sell the ordinary dates on cash in the open market and then to purchase dates of a better quality on cash. He also advised to adopt this procedure in all weighable items. This last sentence further supports the opinion of Imam Abu Hanifah that all weighable and measurable items are subject to the prohibition of Riba. The ground of this prohibition is that the principle of exact similarity is impaired. The Shariah has emphasized the principle of similarity and exactitude of the two commodities in sale and purchase to the maximum possible extent and any increase on one side only invalidates the contract. The parties should clearly know that both the commodities are exactly equal to each other in term of their quantities. The principle is that the lack of knowledge about the equality of the two commodities shall be presumed to be like having knowledge about the existence of the increase. Imam Shawkani has adopted this maxim as a title to a chapter in which he quotes the following Hadith: "It is reported from Jabbir who says that the Messenger of Allah has prohibited the sale of a heap of dates whose quantity is not known for another quantity of dates whose quantity is known". Commenting on this Hadith which is ‑originally reported by Muslim and Nasai, Imam Shawkani says that the sale of one kind of commodity for that very kind is not allowed if the quantity of one of them is not known because a knowledge with certainty that both the commodities are exactly equal in weight and quantity is a precondition of the contract of sale. Without fulfilling this condition the sale will be invalid. Imam Shawkani further says that the ignorance of the quantity of one or both the commodities is always subject to the possibility that the quantity of one commodity may be bigger or smaller than the other commodity and that whatever is subject to this possibility shall be prohibited and should be avoided. The prohibition of this sale is not only because it has the possibility of the involvement of Riba but also the involvement of Gharar, or the uncertainty and speculation which may lead to dispute and litigation.
On the other hand the sale of non‑fungible things is allowed both with increase as well as with deferred payment. There are Ahadith reported by Bukhari, Muslim, Abu Dawood, Trimidi, Nasai, Ibn‑i‑Majah, Imam Ahmad, Imam Malik, Dar Qutni, Bayhaqy, and others on the authority of Jabbir, Anas, Abdullah Ibn‑i‑Amr, Ali ibne Abi Talib, Samurah and several other companions to the effect that non‑fungible thing may be sold with increase and deferred payment. In these Ahadith, instances have been reported where the sale of one camel of high breed for two, three, four or even twenty camels of a lower breed both on cash as well as deferred delivery may be allowed. Explaining this permission, Hazrat Abdullah ibn Abbas says that one camel (of high breed) may be costlier than two. It has been reported by Imam Bukhari and Imam Abdul Razzaq that Hazrat Rafi Ibn Khadij, a companion, once bought one camel for two camels and delivered one camel on the spot and promised to give the delivery of the other, next day. On the basis of these authorities Said ibn al‑Musayyib, the most prominent Follower, has laid down the maxim, as quoted by Imam Bukhari, Imam Malik and Imam Ibn Abi Shaybhas, that there is no Riba in (sale and purchase of) animals. Similar views have been expressed by Ibn Sirin, another leading Follower. This has been the opinion of the overwhelming majority of the Jurists. But this applies only to such animals which are considered qimi or non‑fungible in the market. As regards such animals as are treated fungible in the market, the prohibition will apply.
An important question relevant to the problem of Riba is that of the contract of `Inch' which has been prohibited by the Prophet of Islam (p.b.u.h.). It has been reported by Tabarani, Imam Ahmad and Abu Dawood on the authority of Hazrat Abdullah Ibn‑i‑Umar that the Holy Prophet (p.b.u.h.) has said "when people become miserly and niggard about Dinars and Dirhams and enter into transactions on the basis of 'Inah', stick to their cattles and agriculture and abandon the Jihad in way of Allah, Allah imposes on them a colossal trial and disgrace and He will not lift it until the people revert back to their Din". In this Hadith the term 'Inah' is very significant. Literally it means purchase on credits, sale on deferred payment or sale on the basis of loan. If the literal meaning of the word 'Inah' is taken then the Hadith would mean that the economic activity based on credit and loan brings ordeal and disgrace to people. However, the scholars of Hadith have mentioned a particular kind of sale which was known with the name of 'Inah'. According to Firuzabadi, the well known classical Arabic lexicographer, the Inah sale was that a person would sell his commodity for a price to be paid later and then would re‑purchase it back from him for a lesser price. The same explanation has been given by Imam Rafi'i. His explanation of the Inah sale is more elaborate. He says that in an lnah sale the seller would sell his commodity for a price to be paid later and would make the delivery of the commodity to the buyer and then would purchase it back before receiving from him the delivery of the price for a cash price lesser than the previous price. This explanation shows that it was similar to the buy‑back agreement prevalent today. As a further support to the prohibition of this kind of sale, Ibn Qayyim refers to the Hadith reported by Imam Awzai that the Prophet (p.b.u.h.) has said: "A time shall come to mankind when they will legalise Riba under the garb of trade". Commenting on this practice Ibn Qayyim says that in effect "it is an open and clear Riba?based transaction on which both the parties are agreed before entering into the actual contract. Only its name has been converted and an outer term of trade has been used without being actually intended. It is nothing but a trick, fraud and deception perpetrated against Allah the Almighty". Ibn Qayyim further says that such tricks cannot affect the prohibition of Riba and cannot eliminate the evils because of which Riba has been prohibited. Rather, such tricks add further force and emphasise to those evils.
It has been pointed out elsewhere that the tendency of Islam is to discourage barter system and to encourage monetary economy as far as may be practical. The Holy Prophet (p.b.u.h.) issued certain instructions and laid down several principles which discourage barter trade. The prohibition of the exchange of fungible goods with the same fungible goods if they are of the same kind is a clear indication of that tendency. This is also supported by a Hadith reported by Imam Ahmad, Abu Dawood, Ibn Majah and Hakim on the authority of Abdullah ibn Amr al Mazini who says that the Messenger of Allah has forbidden from melting the coins prevalent and current among the Muslims without any excuse and to convert the Dirhams into silver and the Dinars into gold. Imam Shawkani extends the prohibition to the melting of other metallic coins or the fulus as well, particularly when these are current and popular among the Muslims. The wisdom of this prohibition, according to him, is the harm caused to the people by the reduction in the supply of available Dirhams and other coins as 'a result of their melting and the resultant stoppage of their circulation. It shows that Muslim jurists were aware of the impact of the increase and decrease in the circulation of money on the inflation and deflation respectively. Ibn Ruslan has however exempted from this prohibition to melting of those coins which have been demonetized and substituted by new ones. According to him in such a situation the melting of the demonetized Dirhams is allowed with the purpose of extracting the gold or the silver from them.
In order to pre‑empt the possible avenues and to foreclose the doors of tricks that may possibly be employed to enter usurious transactions through backdoors, the Prophet of Islam discouraged practices and modes of trade which could possibly be resorted .to for this purpose. One such example is found in the case of Hazrat Fadalah ibn Ubaid the details of which have been recorded by Muslim, Nasai', Abu Dawood and Tirmidhi. Hazrat Fadalah reports: "On the day of Khyber I bought a necklace for twelve Dinars. (A dinar of Madinah was a golden coin of almost 4.5 grams of gold). The necklace contained some gold and some precious stones. When I separated the two I found that it contained more than twelve Dinars of gold. I mentioned it to the Prophet (p.b.u.h.). The Prophet said that it cannot be sold unless it is separated. The companion said: "I only wanted to purchase the stones". The Prophet said: "No you cannot purchase it unless you separate the two". The reporting companion says that the Prophet ordered him to revoke the deal until such time when the two were separated. It may be mentioned that he had purchased the necklace for seven or nine Dinars. The principle derived from this Hadith is that any deal in which a quantity of gold is sold for a smaller or larger quantity of gold is invalid whether it is the exclusive sale of gold or it includes other commodities.
This principle will also apply to all such commodities in the exchange of which the law of Riba al‑Fadl applies. This principle is also supported by the Hadith which prohibits the sale of an unknown quantity of wheat for a known quantity of wheat as already pointed out. It is also supported by the Hadith in which the sale of one kind of dates for another kind of dates without weighing the two has been prohibited because of the absence of definite knowledge and verification of the quantity of the two commodities with exactitude. Likewise, is the case of necklace it was difficult to determine the weight of gold included in the necklace without it being separated from the stones. Moreover, mere separation is not sufficient for sale but it is to be ensured that the quantity of gold taken from the necklace was exactly equal to the quantity of gold represented by the Dinars. A large number of jurists including Hazrat Umar, Imam Shafi'i, Imam Ahmad and Imam Ishaq are of the view that the sale of a commodity which includes gold or silver as a part in any ratio is prohibited. However, Imam Abu Hanifah and some other scholars hold a different view. On the basis of the details reported about the case of necklace, Imam Abu Hanifah is of the view that if the gold included in the necklace etc. is lesser than the price offered the deal is allowed. He considers the excess amount to be the price of the stone. While the price of the gold will be presumed to be exactly the equal amount out of the Dinars paid. Imam Malik also holds a similar view but with a slight variation. He says if the gold does not constitute major component of the goods and the gold component in the commodity is less than one‑third its sale is allowed without separating the two.
Another example of preventive measures taken by the Prophet to close backdoors of Riba is the prohibition of 'Muzabanah' sale which was prevalent in Madinah. It was the forward sale of dates while they were still on the trees for a certain quantity of ripe dates delivered at the time of the deal. This prohibition has been reported among others by Imam Bukhari and Imam Muslim on the authority of Hazrat Abdullah Ibne Umar. Muslim adds in one of his versions and the Messenger of Allah also prohibited the sale of any fruit without weighing it. In a Hadith reported by all the five major compilers of the Hadith Saad Ibn Abi Waqqas says that he heard the Prophet being asked about the sale of dry dates for fresh dates. The Prophet asked those around him: "Do fresh dates get reduced in weight when they are dried up?" They answered in the affirmative. The Prophet then forbade it.
On the basis of these Ahadith the overwhelming majority of Muslim jurists hold that the sale of unknown quantity of any commodity is invalid if the commodity is mithli or fungible. These examples show how the Shariah is sensitive about Riba and its contributives and how it closes all possible avenues to foreclose the door of Riba. Another example is the prohibition of buyback agreement, if it is misused for covering up any Riba‑based dealing as is evident from the following Hadith reported by Dar Qutni: "A lady called on Hazrat Ayesha, Mother of the Faithful, and told her that she had sold something to Zaid ibn Arqam for eight hundred Dirhams to be paid later and she had immediately purchased it back from him on cash payment of 600 Dirhams. Hazrat Ayesha said to her: "Woe to what you have purchased and woe to what you have sold! The Jihad undertaken by him with the Messenger of Allah has been thereby put to a naught unless he repents".
Another important question in the 'context of the discussion of Riba and its meaning in the Qur'an and the Hadith has been technical status of the Hadith which lays down the principle that every loan which entails benefit and usufruct is Riba. This has been accepted principle right from the beginning and the technical discussion about its status in terms of the categories of Ahadith has never been taken to be a basis or justification to dispute the authenticity of this principle. Some scholars raise the issue of the status of this dictum as a Hadith and conclude that the principle laid down on its basis is not acceptable because technically it has not been declared to be a Hadith of the highest category of sound Hadith. A number of scholars have discussed the technical status of the Hadith including late Maulana Zafar Ahmad Usmani who had dealt with this question in a scholarly treatise entitled Kashf al‑Duja an Wajh Ma'na al?Riba. The late Maulana Zafar Ahmad Usmani dealt with different aspects of the question of the authenticity of this Hadith and has concluded that the principle laid down in the Hadith is an acceptable principle supported by a number of reports and principles. Relying on the sayings of leading authorities of the science of Hadith, Maulana Zafar Ahmad Usmani says that the general acceptance of Hadith by the jurists is a clear indication that it is a valid Hadith and has to be accepted as a basis of laying down the principle. He has quoted the names of various companions and other early authorities who have relied on these reports and accepted the Hadith as a fundamental principle. Moreover this Hadith and several other Ahadith and sayings of the Companions highlight different forms of Riba as prevalent among the Arabs, some of which have been accepted without any scrutiny by writers like Dr. Fazlur Rahman, Shaikh Tantawi and Justice Qadeeruddin Ahmed. As far as this principle is concerned objection has been raised to doubt the authenticity and blur the acceptability of this Hadith on weak grounds. Maulana Zafar Ahmad Usmani has quoted several statements of the Companions recorded by different compilers of the Hadith to support the principle that usufruct or benefit accruing from a loan is Riba. These statements put together reach the status of consensus of the Companions and their followers. It can undoubtedly be considered to be a tacit consensus because in the absence of any counter‑opinion, the views expressed by several Companions about the usufruct or benefit accruing from loan being Riba, such views should be accepted as Ijma `. It means that the remaining body of the Companions agreed to the views of these Companions. Therefore, even if there is any doubt at all in the fact that this statement is a Hadith, it makes no different in view of the unanimity of the Companions. It may be pointed out here that a unanimous ruling of the Companions constitutes an integral part of the Sunnah and has the authority of not only Prophet of Islam (s.a.a.w.) but also enjoys the support of the Qur'an.
Before parting with the discussion on the nature, classifications of Riba and impact of its prohibition on trade and business, it appears appropriate to discuss the rationale and wisdom (Hikmat) in the prohibition of Riba to all its forms. This discussion does not mean that we consider the wisdom to be the ratio decidendi or illah or the deciding factor of this prohibition. Riba is prohibited because Allah has prohibited it. The wisdom discovered by finite human beings cannot be the illah or the deciding factor behind a divine decree. Following discussion is based on the writings of Muslim scholars as well as the submissions made before us.
Muslim scholars have been addressing themselves to the important question of the rationale of the prohibition of Riba from the very beginning. These include both classical writers and commentators of the Qur'an as well as the modern Muslim scholars. The well known commentators of the Qur'an, Imam Fakhruddin Razi and Allamah Khazini have identified the following main reasons of the prohibition of Riba. Firstly, Riba‑based transactions have a tendency of , eating up people's money without consideration. A habitual interest‑eater gets money without any risk or labour whether the transaction is on the basis of cash payment or on the basis of deferred payment. Secondly, when interest gains currency it prevents people from productive activities such as trade and commerce with the result that the sphere of human activity suffers adversely. A capitalist prefers risk‑free money‑lending to risky operations of trade, commerce and industry with the result that cash‑flow is diverted from real and productive economic activity to unrealistic and non‑productive usurious practices. Thirdly, interest puts an end to the pious act of giving free loans to people. When interest is prohibited people would be happily prepared to share their resources with others in a spirit of cooperation and sacrifice. In a society where interest is rampant, no one is ready to come to the help of others without claiming his own premium. This puts an end to the sentiments of brotherhood and charity. Fourthly, for a Muslim, the very fact that the Qur'an has prohibited Riba is sufficient to abstain from it without seeking any further rationale or wisdom to justify its prohibition. Fifthly, the Riba?based transactions give rise to a strong tendency of causing injustice to the poor which adds to the wealth and affluence of the wealthy. Similar views have been expressed by Syed Qutb in his well‑known commentary, Fi Zilal al‑ ur'an (Volume III, page 33). He says that the hallmark of an Islamic society is love and respect of each other's rights by the members of the society. People should demonstrate moral purity and good behaviour. When a person demands interest from another person he can do so only after devoiding himself from good morals and conscience and whenever a society adopts this practice the whole society becomes devoid of mutual love, affection and the spirit of cooperation. Shaikh Muhammad Abu Zahrah. a leading jurist of Egypt of 20th Century considers injustice to be the base of the prohibition of the Riba, Injustice has been condemned and prohibited in respect of everyone. It is not something which may be prohibited for some people and may be accepted as permissible for others. The Holy Prophet (s.a.a.w.) reports that Allah, the Almighty, has said: "My Servant! I have declared injustice to be prescribed for Me and prohibited it to be practised among you. Therefore, do not deal with each other injustly ".
The Qur'an has also referred to the elimination of Zulm as the wisdom and rationale behind and prohibition of Riba in Chapter‑11:279 which mentions that neither the lender nor the borrower should be wronged. In this verse the term 'Zulm' has been used which is the antonym of Adl (justice) in Islam. Some people take very cursory view of wrong and injustice mentioned in this Qur'anic verse. It has been contended that wrong and injustice is found only in an interest charged on a loan taken by the poor for personal and consumption purposes. Undoubtedly the increase on consumption loans falls under the category of Riba and is prohibited. But it does not ipso facto mean that increase on other forms of loans does not involve any injustice or wrong. If the rationale and wisdom of the prohibition of Riba is to close the door for every wrong and injustice in all its forms and at all possible levels, then the prohibition of Riba must extend to all increases on all forms of loans, i.e. those meant for personal and consumption purposes as well as those for commercial and production purposes.
The element of Zulm and injustice in Riba has to be discussed in the wide application of concept of justice in the field of distribution of resources and socio‑economic life in the society. It is difficult to agree with the contention that the charging of interest is prohibited only because of the wrong and injustice it inflicts upon the poor. This argument does not go far enough towards the full rationale of the prohibition. Borrowings during the days of the Prophet (s.a.a.w.) were primarily undertaken not by the poor for their personal needs, as the Bait al‑Mal as well as the philanthropic Muslim community was more than ready to come forward to respond to the needs of the poor, but borrowings were always taken by the tribes and groups of rich traders who operated as large partnership companies to conduct large scale trade. Tribes and tribal groups worked as trading companies whose formation was necessitated by the prevailing circumstances: the different terrain, the harsh climate, the inclement weather and the slow means of communication. These factors had made the task of the trade caravans difficult and time consuming. In such conditions it was almost impossible for individual traders and businessman to undertake trade journeys on their own and to pay for their business trips to such far off places as are known to be the destinies of Arab Traders: Rome, Syria, Asia Minor, Egypt, Persia, Zanjibar, China, India, Sri Lanka etc. In view of these difficulties, Arab traders had organized themselves into large tribal groups which operated as big partnership companies, and undertook two major business trips every year: to the East during the winter and to the West during the summer as referred to in the Qur'an as the trip of the winter and the trip of the summer (the Qur'an:106). According to the available data members of the Makkahn aristocracy and the businessmen from the hill resort of Tayef either themselves undertook these journeys or contributed to it by providing money to those who undertook them. The traders joining the caravans also took big loans from more affluent members of the aristocracy and the business community. The money so borrowed remained blocked for long periods of time extending from months to years. It was, therefore, necessary for the caravans to muster and mobilize all available financial resources by which they would also purchase the local exportable products to be sold abroad so that the importable items and products manufactured in the different parts of the world are brought to the `Mother of the Towns'. Thus all the needs of the local population were procured and fulfilled till the next trip was organized. Any person familiar with the history of trade in pre‑Islamic Arabia knows the secret of the affluence of the Makkahn society as well as of their undisputed political prestige and unrivaled commercial influence throughout Arabia. This international trade accounted for the pride and vanity of the inhabitants of Makkah and Tayef. It was because of this deep?rooted nature of Riba and interest in the life of Arabia which accounts for the stern opposition of the Makkahns to the message of Islam. It also answers the question why gradualism was observed by Islam in eliminating this evil. It also explains the curt and the uncompromising attitude of Islam towards any form of Riba or any element of interest or usury.
It is known to everyone familiar with Seerah and Islamic history that the Prophet (peace be upon him) and the righteous Caliphs as well as other companions after him made many agreements with the non‑Muslims living in Islamic territories. Such agreements were made with Jews. Christians and the Polytheists living in different areas. Under these agreements, these non‑Muslims were granted their rights of honourable living within the territories of Islam according to their respective religious convictions. They were even permitted to drink liquor and eat pork. Yet despite these liberal conditions of religio‑cultural autonomy, they were never allowed to indulge in the transactions of interest. The agreement made by the Prophet (p.b.u.h.) with the Christian of Najran and the polytheists of Tayef clearly stipulated the condition that in the event of their indulging in the business of interest, this agreement shall be void.
Similarly the Second Caliph Umar (r.a.) made a number of treaties with non‑Muslim tribes under which the latter were permitted to live as free citizens under the Islamic dispensation. The texts of these treaties have been thoroughly discussed by the Jurists of Islam. They have paid special attention to the treaties during the reign of Umar (r.a.) and derived from them detailed provisions of the Shariah with regard to the relations with non‑Muslims. These documents were prepared by the Prophet's own companions. There could not have been a more sacred source than the treaties made by the companions. All these documents and treaties stipulate the condition that these treaties shall be void if the non‑Muslims indulged in any transaction of usury, This clearly means that if they will murder a Muslim, only the murderer shall be punished. The community as a whole will not be taken to task. If these people will be found involved in any conspiracies against Muslims, then only the conspirators will bear the brunt of their misdeeds. And this will not affect the agreement with the community of non‑Muslims as a whole. Similarly, anyone committing adultery shall be individually held liable to punishment. The agreement will remain intact But if anyone indulged in usury, then the whole agreement shall ipso facto become void and there will then be open war with them. This clearly demonstrates that the Prophet (s.a.a.w.) and the Prophet's companions considered usury such a heinous crime that an individual's commission of it was regarded as sufficient ground for terminating the whole agreement of peace and friendship with them.
It has been pointed out that the very verse of the Qur'an that implies disapproval of Riba is Verse 39 of the Chapter al‑Rum. This verse refutes the supposition that through Riba the wealth grows. For in the sight of Allah this is no growth. But the spending by way of Zakat and charity that seeks the pleasure of Allah is the real excess and growth. This chapter was revealed in Makkah prior to Hijrah. This shows that even before handing down detailed provisions of the Shariah, the Qur'an had forewarned its followers about the undesirability of Riba. The first express mention of the prohibition of Riba for the Muslims, as discussed earlier, is found in Verse 130 of Surah Al‑i‑Imran of the Qur'an which was revealed in the context of the Qur'anic narration of the battle of Uhud. Apparently there is no relevance of this battle to the prohibition of interest. But actually there is close relation between the two. The Mufassirin have mentioned a number of reasons for this Qur'anic reference to the prohibition of interest in the context of this narration of the battle of Uhud. Some of these reasons are as follows:
(i)???????? The difficulties faced by the Muslims during the Battle of Uhud and the heavy loss of lives was chiefly attributable to the secret collusion between the Jews and the hypocrites (the latter were in effect the agents of Jews).
(ii) The Jews exercised an effective control over the market and commercial life of Madinah. All the Arab tribes of the adjoining areas were in debt to the Jews (the Jews had always been proverbial for their practice and promotion of usury. They still control the interest bearing banking system of the world today). Through lending money on interest, they had shattered these Arab tribes in the stakes of their influence. In this context, the Qur'an dealt a severe blow to their economic domination by declaring the prohibition of interest. Thus it gave a message to the believers for all times to come that the most effective means of liberating themselves and guarding themselves against the conspiracies of the Jews was the prohibition of interest. (If usury or interest is totally abolished it becomes quite easy to terminate the economic domination of the Jews and their agents. That is why whenever the issue of abolishing interest is agitated, the strongest opposition comes from the mercenaries of Jews and Hindus who are chosen allies of each other as eaters of interest).
(iii)?????? In the battle of Uhud some Muslims showed weakness which was exploited by the infidel forces and the tables were turned. This weakness was caused by the eating of interest which blackens the heart. This darkness of the hear hampers the performance of virtuous deeds.
(iv)?????? The thing which had caused the greatest loss to the Muslims in the Battle of Uhud was the retreat of the marksmen from their position in their hurry to get the spoils of war. This attitude betrayed a certain love of wealth. If love of wealth becomes deep‑rooted, this love leads to the practices of usury and gambling. That was why Allah (s.w.t.) uprooted this feeling at the very outset by prohibiting interest so as to keep the human tendency to love wealth within natural limits.
(v)??????? The spirit of Jihad is to give away one's life and property in the cause of Allah. without hesitation. If this spirit is weak, the requirements of Jihad cannot be fulfilled. That is why the fighters in the cause of Allah are to this day immune from the germs of eating usury. In fact the eaters of usury have never been seen fighting in the cause of Allah. This is because performing Jihad with money and wealth and eating usury are two totally opposite things.
In the verse cited above, eating doubled and redoubled usury has been prohibited. However, this does not mean that eating interest less than double or quadruple is permissible. For the express injunctions of the Qur'an and the Sunnah clearly prohibit the practice of interest in the above forms. The expression used in the above verse has been employed to expose the evil and abominable nature of usury.
These verses not only clearly and emphatically prohibit the practice of Riba, but also point to an evident and obvious difference between Riba and buying and selling. The Qur'an has contented itself by regarding those who equate between the .two as baseless and stupid. It has not detailed the difference between the two. This shows that the Qur'an considers this difference to be such an obvious and self‑evident fact that hardly needs elaboration.
The major difference between sale and interest is that the money received in sale in consideration of some wealth whereas the money which the eater of usury charges in excess to the principal is not charged in consideration of any wealth. The second difference between sale and usury is that buying and selling promote trade and thus disseminate wealth, whereas in usury, the wealth shrinks and becomes concentrated. As a result of this the eaters of usury become richer and richer. The third difference between sale and usury is that everyone is responsible for the gain and loss of the wealth that he holds. But in the system of usury the creditor is merely entitled to gain and throws the entire burden of loss on the debtor. The fourth difference between sale and usury is that the transaction of sale once taking place is concluded and the two parties thereafter may carry on their normal business. Whereas the eaters of usury in most cases do not leave the debtors and continue endlessly with their claims on him. The curse of compound interest causes untold destruction of the whole families through its treacherous mechanism. The fifth difference between sale and usury is that once the profit is procured by whatever ratio it might be the claims of the seller come to an end. But the demands of the eaters of usury seldom end and often continue to secure gains and interests for long periods of time. The sixth difference between sale and usury is that‑the process of sale claims the hard work, potential, ingenuity and time of the seller and thereafter provide him with some profit. Whereas in the case of usury, the eater stays away from all labour and toil and from the security of his home, he continues to receive all gains and interests. In this way, he is not a participant in the trade or business. These and several other differences between sale and usury underline the emphatic Qur'anic Injunction of considering one of them is totally prohibited and the other is pure and permissible.
Commenting both on the economic rationale and the moral wisdom of the prohibition of Riba, it is said that usury is not the means to progress and prosperity, rather it is conducive to decline and bankruptcy. The wealth acquired out of usury is devoid of blessing. It neither provides contentment of the heart or tranquillity of the soul, nor does it promise any real system of social justice for the society. Moreover, the eaters of usury shall be deprived of the ultimate bliss of the hereafter. But on the other hand, charity (Sadaqa a brings blessing to wealth. The performer of this good is rewarded with the wealth of inner contentment and peace of mind. Moreover, a society based on the values of truth, brotherhood and compassion soon witnesses a system of socio‑economic justice in a real sense. In addition the Prophet (p.b.u.h.) has pointed to the fact that the wealth of usury despite its apparent increase eventually leads to bankruptcy. History of economics also clears this fact out. When a society dealing with usury is afflicted by recession, it meets such disastrous and catastrophic consequences that are without parallel in an interest‑free society. The rise and fall characteristic of an interest‑bearing system that affect the trade and business are almost absent in an interest‑free economy. The theories propounded by economists about trade cycles and their after‑effects are more or less applicable to the system based on the concepts of usury. The Qur'an verse (ii:276) makes a comparison between usury and charity. Both of them are concepts that are poles apart in their letter and spirit. The former essentially represents the attitudes of greed, selfishness, exploitation and a mad pursuit of money and wealth. The latter epitomizes the virtuous and lofty values of cooperation, fraternity and contentment.
The last Qur'anic verse pertaining to usury that was revealed at the conquest of Makkah prior to the Farewell Pilgrimage, abolishes all prior claims and outstanding dues of interest. This injunction was further reiterated by the Prophet (p.b.u.h.), in his last sermon during the Farewell Pilgrimage. Moreover, acting on his old practice, the Prophet (p.b.u.h.) first implemented the prohibition on himself and his family before imposing it on others. He abolished all claims of his uncle Abbas to the outstanding dues of interest. Moreover, he abolished all claims of interest that Muslims had against non‑Muslims. In this verse the Qur'an has used the term ra's al‑mal (capital). This is a clear allusion to the fact that this prohibitory command extends to both commercial and consumption loans. Because on the one hand, the consumption loans were in negligible number, and on the other, it was quite unlikely and of rare occurrence, in view of the golden Arab traditions of generosity, charity, and helping the needy, that the chieftains of Quraish and generous and magnanimous men like Abbas bin Abd al?Muttalib should extend consumption loans to poor people on interest.
Islam seeks to build a society based on justice and equity. It bears the torch of the perennial values of justice and generosity and wants these free from the elements of selfishness, exploitation and mutual deception and fraud. It is rather anchored in the noble feelings of cooperation, mutual values to reign supreme in the society as a whole. The nature of relations between the individual members of the society stipulated by Islam is rooted in mutual care, brotherhood and sympathetic cooperation. Hence, the relationship and the dealing between the members of the Islamic society is sympathy and support. To protect and promote these noble values, Islam has closed all the avenues of oppression and exploitation. It has prohibited and discouraged all those things that lead to injustice and oppression and has extolled and encouraged all those deeds that inspire people towards mutual care and cooperation.
The mentality which is bred by the indulgence of people in usury militates against the values of Islam at every step. For the sole aim of the eaters of usury is to fill their purse and pocket through exploiting the needs and wants of other people. Therefore, the words of sympathy and care are foreign to their vocabulary. In fact the Islamic concepts of mutual care and healthy cooperation are totally intolerable in their quarters not to speak of finding any congenial climate for their fruition. In the following pages we would enumerate some of those evils of interest that bring into focus the contradiction and conflict between the practice of interest and the. over‑all teachings of Islam. For facility of comprehension, we may divide these evils into three main categories:
(1) Moral evils.
(2) Social evils.
(3) Economic evils.
First, the moral evils. The ethical considerations were seldom allowed to enter the arena of economics and banking under the aegis of the Western civilization. However, under the Islamic terms of reference, it should be the conviction of us all \as Muslims that the goodness or evilness of everything is to be determined by those moral principles that have been prescribed by the Shariah. It is on the basis of these principles that we regard something as permissible or prohibited:
(i)???????? The very first evil of usury is its being a sheer injustice. Not only that, but it gives rise to a series of injustices the scope of which is widened and expanded day by day and moment after moment. Any business initiated on the terms of usury starts a new vicious circle of usury in the society. This vicious circle tramples the innocent hopes and aspirations of all those whom it envelopes and entangles. With the result that none feels the slightest tinge of remorse over the plunder of an oppressed home, bankruptcy of an insolvent, or destruction of the supporter of someone rendered suddenly shelterless. This cruel and callous psyche is the essential consequence of usury. Once these hardened attitudes gain ground in human affairs, the result is the eventual death of all elements of humanness, virtue and fraternal feelings among the people.
(ii)??????? The second biggest evil of usury is that it engenders such an abominable and loathsome self‑entredness that makes everyone solely concerned with his own profiteering and success in business. Whatever might be happening to others is none of his business. Whether the debtor is dying of starvation or living in luxury is not the creditor's concern at all. His sole concern is to secure his principal amount with interest at the stipulated time whether this might require the debtor to sell off his domestic utensils or dress of his body.
(iii)?????? The third evil of usury which leads to scores of serious cultural ailments is the superiority of money and wealth over human beings. Whereas money is merely an instrument of fulfilling human needs. 1t is not an end per se. But under the system established by the eaters of usury, man is relegated to a secondary position while the satisfaction of his needs is given ever lesser importance. Money and capital assumes the first and foremost priority in life. This attitude reduces man's, labour into a worthless and trivial thing, while capital becomes a value unto itself. None regrets the loss of human toil and labour. But if the eater of usury by any chance loses a few pennies, he leaves sighs of grief for grief for many years. The system of usury, instead of making man the object and the capital his servant, turns the capital into deity and reduces man into its subject and servant.
(iv)?????? Once entangled in the vicious circle of usury, one forgets the blessings of legitimate earning. For the blessing that one receives out of his earning through hard labour is never enjoyed by those who receive free and labourless benefits of capital in the security of their homes In the beginning human nature refrains from indulging in usury. With the passage of time man becomes addicted to easy proceeds of interest and becomes averse to the thought of legitimate sustenance.
(v)??????? While explaining verse (2: 275) the exegetes have said that the eaters of usury become so much blinded by love of wealth and capital that this becomes their sole motive in life This sick obsession with money erodes all moral virtues one after the other. Greed and niggardliness that have been vehemently condemned not only by the Qur'an and the Sunnah but by all books of religion and morality, permeate the soul and spirit of usury eaters‑ Their chief motive of life becomes hoarding of wealth through maximum exploitation and deprivation of others.
(vi)?????? It is often observed that the eaters of usury soon take to gambling. Once they are overcome by the damns of greed and passion for money, their minds become engrossed in thinking of new ways of grabbing money and securing gains. Soon their diabolical mind seduces them to pursue the way of gambling which is even easier means of getting riches than usury. When one becomes habitual in enjoying easy money, he taps every source that might provide him maximum wealth with minimum labour. And this object is quite easy of attainment through gambling. When human perversion drags someone to plug the games of chance, he gravitates to the lowest ebb of indignity and disgrace. How often one hears of those who lose their wives and daughters in gambling.
These were some of the very obvious evils of usury that pertain to moral category and that are to be found in all those societies that practise the system of usury. Although mention of morality in the context of economics often raises many eyebrows, but if we are really genuine in our claims of Islamizing the society, then we will have to initiate and conclude everything on the moral criteria. Apart from these moral evils, there are certain social evils that are borne of the womb of usury. These evils infect the whole social fabric with their germs of corruption and finally bring about the destruction of a society. We will mention below some of these social evils that directly arise out of the system of usury. These are the evils that have afflicted the contemporary society including a large part of the present day Muslim Society with their ailment.
(vii) The horrible concentration of wealth (which we will shortly elaborate) brought about in the society owing to the system of usury bifurcates the society into two parts. On one side of the fence there are found some individuals who are the eaters of usury. They control 95 % of the whole society's resources. Through this monopoly they dictate their whims to the society. On the other side of the fence are found millions of multitudes languishing and crying for a morsel of bread to keep their bodies and souls together. This brings a serious social divide between the two classes. This divide is further cemented by the economic frontiers that are permanently established between them minimizing the prospects of the social nobility for the poor and deprived ones. This state of affairs breeds mutual distrust and hatred often leading to rancour feuds and fights. In this way the society presents such abominable specimens of class struggle that have constituted a classical chapter of history in the communist philosophy.
(viii) It is the nature of wealth that it loses weight and value if it is acquired without labour and toil. Easy money seldom receives proper care of the possessors. In all those societies where money is obtainable by the affluent classes without investing the required effort and struggle, there always arise unlimited ailments. People in these societies compete with each other in squandering money and wasting resources. This state of affairs does little harm to the few hundred families who hoard vast riches but takes its toll from those hundreds of thousands of families who either have no easy money or lack the resources for it. The most deplorable becomes the social condition of those millions of families who do not find even a single night's meal easily. The tendency to concentration of wealth and unwarranted inflation of money is invariably productive of such serious social and moral evils that agitated the mind of the Prophet (p.b.u.h.). And that is why the Prophet (p.b.u.h.) was seldom worried about scarcity of money but often apprehended its excess.
(ix)?????? A society basing its economic life on a system of usury could never aspire to establish itself on firm moral footing. It simply cannot generate that spirit of cooperation which Islam calls for. That is why whenever we talk today of the concepts of mutual care and maintenance granted by Islam and invoke the perennial social values of our religion that give rise to these concepts, people who are not properly educated in the lore of Islam are rather taken by surprise.
These are some of the social evils that are the necessary consequences of the system of usury. They gradually eat into the whole fabric of the society. Apparently the societies seem to expand and flourish but actually lose all substance and potential. With slight jolt, they crumble to the ground. There has been exhaustive discussion among the economists about the economic ills of usury. It has become by now a near consensus among all fair‑minded and objective observers and planners of economic future of humanity that the economic problems arising out of the interest?bearing economic systems could only be solved through abolishing interest from the whole world. The most famous economist of the modern Western world who is internationally recognized expert in his field Lord Kaynes emphatically says that the problem of unemployment shall defy all solutions unless interest is abolished from the economics of the world. He further contends that the best way to demolish the exploitative superiority of the capitalist's class is to eliminate the system of interest. The writings of Kaynes and other leading economists of the world on the negative aspects and demerits of interest has been comprehensively summarized by our country's most outstanding economist and researcher late Shaikh Mahmud Ahmad, in his concise but masterly work entitled "Man and Money".
In fact when interest is accepted as the principal basis of investment, it militates against the well‑being and welfare of humanity from so many directions that a slight description of it is sufficient to substantiate the Qur'anic declaration of war against its perpetrators: Prof. Shaikh Mahmud Ahmad has enumerated sixteen evil characteristics of interest:
(1)??????? An evil consequence of interest is that it creates such a heavy encumbrance on the capital that it limits the scope of all productive and commercial activities. The result is that the productive activity shrinks and its natural growth and expansion is arrested. This is the basic and fundamental point which represents the roots of all the economic exploitation the interest based system creates.
(2)??????? The interest has an adverse effect on employment, particularly, self‑employment, mostly because of borrowing facility of the interest‑based system is limited to big financiers and capitalists. Small businessmen and entrepreneurs seldom get any borrowing from this system.
(3)??????? An entrepreneur is forced to maintain the level of profit much higher so that it should always exceed the highest limit of interest. If the level of interest is commensurate with the actual level of profit, the borrower faces the problem in paying the interest. Thus, interest and profit are concomitant. The excessive profiteering and the result out increase in prices is a direct result of interest.
(4)??????? The rental of all landed property (agricultural land, houses, shops) is consistently on the increase because the entrepreneur has to pay interest on the value of the landed property as well.
(5)??????? The entrepreneur is forced to keep the level of profit above the level of average rent plus the cost of wear and tear. This also results in decreasing the salaries and wages of the labour and adds a further dimension of socio‑economic conflicts and problem.
(6)??????? The price hike is consistently on the rise resulting in increasing the agonies and accentuating the economic difficulties of the lower and poor class.
(7)??????? The rising price curtails the demand leading alternatively to the fall of production. The fall of production places the whole economy at a very precarious level.
(8)??????? As a result of the depression in the market a tendency takes place to freeze the production at a certain stage, i.e. a stage where the maximization of profit is possible. The freezing of the production level is the cornerstone of the interest‑based system which is found in almost every capitalist country and capitalist economy. The most striking example of this policy can be seen in the U.S. where the Government spends around 12 billion dollars (in 1980) to freeze the agriculture produce of the country. Such huge amount is not easily available and has to be acquired on interest. Professor Mahmud Ahmad laments the over powerfulness of the capital and weakness of human element as well as suffering of mankind as reflected in this example.
(9)??????? The situation resulting from these evils of interest lead to another dimension: the capitalist class of the country which controls most of the economic resources make the Government believe that the public exchequer should always keep its expenditure above the level of income to prevent unemployment and subsidize the purchasing power of the people. The Governments easily fall prey to this logic and further add to the economic problems and miseries of their people.
(10) Once the Governments fall prey to this machination of the capitalist class it starts controlling the resources of the Government as well and capture a major portion of national income paid as debt servicing to the capitalists. The result is that the Government borrows billions annually and pays billions annually in debt servicing.
(11)????? The wealthy continue to become wealthier and the poor poorer. The middle and the lower classes are continuously crushed under two stones of unemployment and dearness.
(12)????? This situation adds to international tension. Every country tries to increase its exports and decrease its imports so that they? unemployment created by the interest inside the country is exported to other countries through expansion in its exports. Since all the countries equally suffer from this disease no country can achieve any viable success in this exercise. It only adds the international tension often leading to armed conflicts and wars.
(13) The most important casualty is the culture and civilization. Interest being a means to give preponderance to money over human‑beings, it has no concern with the success or failure of human labour. Even if all human labour is lost the capitalist is not prepared to abstain from and relinquish his interest. This results in the continuous and infinite downfall of human values and continuous rise of capital and limitless materialistic tendency.
(14) Those involved in this devilish exercise, to quote the Qur'anic phrase: stand like one whom the devil has striving to madness by his touch. A cursory study of the economic consequences of the system and the resulting miseries will show the? ineffectiveness and bewilderment of modern economy in the face of this colossal problem.
(15)????? The capitalist system ensures that capital‑flow is always controlled so that it does not exceed to the level and the weapon of interest becomes ineffective and useless. In order to perpetuate interest it is necessary that a system is developed to control the flow of capital and to arrest it within the required limit. The most important step taken for this purpose is what is known as bank reserves. Banks keep a certain portion of their deposits as reserve to meet any possible eventuality. The higher the reserve the lower the supply of capital. If the reserve is 33 % the credit issued can be three times the amount of savings. If the reserve is 25% then the credit may be four times. So also in case of 20% 5 times and in case of 10% 10 times. In our country the bank reserve is 35 % so that slightly less than three times this amount the advanced as credit. It means that interest is a self‑generating mechanism in which capital will always be less than the actual need and it will ensure to receive its cost because of its scarcity.
(16) The capitalist class which is the defender of interest is always prepared to put everything at a stake for the sake of its own interest. Nationalization and socialism are some examples of the extent to which capitalist can go to safeguard his interest.
Professor Shaikh Mahmud Ahmad further writes: From the above description, it should not be supposed that these were only evils of interest. The truth of the matter is that the knowledge of the subject is still quite scanty. The capitalist system and its protagonists are trying their utmost to prevent any institutionalized effort to undertake serious research on the problem of interest and its allied issues. The above enumeration of sixteen evils of interest point to the fact that we have not thus far even traversed one quarter of the distance towards gauging the whole range of the negative impact of interest on human life. This is because in a tradition related by Hazrat Abdullah ibn Mas'ud, the Prophet (p.b.u.h.) has said that there are seventy‑three evils of usury. The lowest level of these is like committing adultery with one's mother.
These sixteen aspects of the exploitative nature of usury are those that have been regarded by the Qur'an as injustice. The nature of this injustice perpetrated by interest is different from other categories of interest both in intensity and depth. It is an injustice that not only deprives the poor of their morsel of bread, but also prevents them from finding an alternative means of survival until one surrenders his freedom and honour. There could be other ways of oppression whereby. human beings might be deprived of their means of survival. But there is no other instrument of oppression whereby the victims could possibly be prevented from finding the alternative means of survival. Since the system of Riba directly challenges the Divine Attribute of sustenance and becomes a hurdle to His Sustaining authority and continues to block the bread of human beings until they are deprived of their dignity and honour. That is why this crime deserves declaration of war from Allah and His Prophet (p.b.u.h.) and is seventy times more heinous than adultery with one's mother.
Apart from the social and economic evils of the interest, it must also be borne in mind that the interest and Riba come into direct conflict T with a number of Qur'anic dictates and precepts. As soon as interest is I allowed, a number of Qur'anic Injunctions cease to operate. A few I illustrations may be useful. The Qur'anic verse (2:280) lays down the nature of relationship that should obtain between creditors and debtors when the latter is poor and destitute. Here only two ways are possible, The best attitude is to write off the loan and relieve the debtor. Otherwise respite must be given. The question is if that is the command of the Qur'an and this ought to be the conduct of the Muslims, then we should see whether there is any bank or eater of usury today who is prepared to appreciate the difficulties and hardships of the debtors and grant them respite so as to restore them to survival? But the actual situation in the society is just the opposite. As soon as there appears any sign of weakness or loss in the business of the debtor and, there seems little chances of his recovery, the bankers, the financiers and the creditors are the first to arrive at the scene of the tragedy and place the demand for repayment of their loans before anything else. The cases of companies that have gone bankrupt in our country are well‑known to everyone. In most of the cases the company was doing good business. For some reason the investor became suspicious or doubts were deliberately cast in his mind by any business rival. For this situation. instead of lending help, sharing the problem and helping in its solution, the investor came with his one‑sided selfish demand to recover his money before everything else. Now the Qur'an invites us to the opposite attitude in this regard. It says that in the first place, when you lend money to your brother, your motive should be mutual sympathy, care and love. If the debtor is in difficulty, you must give him respite. Further than that, if you could afford this. then you should even write off the loan. Compare this approach prescribed by the Qur'an with the usury eater's mentality. The fires thing which happens in such a situation is the cruel and callous strangulation debtor by the creditors.
Regarding the circulation of money, the Qur'an has laid down the clear and unequivocal principle in the verse (59:7) that the wealth should not circulate only amongst the wealthy sections of society. The purpose of this principle is that all strata of the society should benefit from the wealth and it should be disseminated among all sections of citizenry. As blood is distributed by the heart and is disseminated to all tissues and fibers of the body each moment in the same way the wealth should reach every portion of the social body and should continue to reach evenly and equitably. To achieve this objective the Shariah has supplied a number of legal and other devices. The aim of these devices or injunctions is to block the possibilities of the concentration of wealth and to distribute the available wealth equitably and as widely as possible. But contrary to this principle, the entire circle of interest revolves around one axis: to acquire more wealth by the force of wealth and to go on maximizing capital by means of capital until the entire resources of the society, are concentrated and come under the control of a handful of financiers. The tendency of usury is that it collects wealth from all the corners. Instead of disseminating wealth. the mechanism of interest ensures that even a meager amount of wealth does not remain out of its clutches. Now the modern banking system as it operates today, ensures precisely this draining off the society's wealth. The small income group deposit their small savings of money earned through hard labour in banks‑ In this way, the earnings of hundreds of thousands of people are pooled in a pond of wealth, as it were. This huge pond of wealth is controlled by a few capitalists. Apparently it is claimed that this capital shall lend money for business and thus it will be spent for the common goals of the society. However, in actual practice, this seldom happens; an ordinary man cannot possibly take loan from the bank and do business with it. Every bank, before granting a loan, demands a guarantee worth hundreds of thousands of rupees. Sometime, it says to the borrower, if he already has a business worth so much amount, he might get a loan worth this much. This means that only those who could provide guarantee and sureties worth millions of rupees have the right to obtain loans from' these banks Then only the already rich and affluent are entitled to enjoy the benefits of bank loans. For instance on the surety of a property worth two and a half million rupees (Rs.2,500,000) one gets another two and a half million rupees. Thus a capitalist who owned 2.5 million rupees became the owner of five million rupees. If he applies for further loan, he could still get as much‑more amount. He will thus get ten million rupees, thanks to the banking system. This means that within a matter of 10‑15 years, the rich shall become richer and the poor shall become poorer. Whatever little wealth was available in the society was drained off and collected in a few hands. As vultures keep watching the dying ones, as soon as death approaches, the. vultures come first. In the same way, the creditors keep vigil over those engaged in business. Whoever appears to be weakening these creditors, hasten to grab his neck and in no time, his whole property is distributed among them. The poor businessman is thus doomed and his remaining resources are also acquired by these capitalist creditors.
An established principle of the Shariah upheld by all Muslim scholars and jurists is the mutual relation between profit and loss. This principle has been derived from the famous tradition of the Holy Prophet (p.b.u.h.) which says:‑"Benefit devolves with liability". Various jurists and traditionalists of Islam have explained this principle in their own language. There is no difference over this principle between any Muslim religious group. All Muslims have consensus on this principle of the Shariah that "anything of which one does not accept the risk or obligation to cover the loss, he is also not entitled to enjoy benefits accruing therefrom". If you are doing business or sharing one, then you will have to incur the risk involved in that business to the extent of your participation in it. When you undertake to accept the obligation to endure loss, then you are entitled to all the profits that might accrue to that business in the open market. But to say that one's money is safe and it will be payable to him irrespective of the successive failure of the business, is something unacceptable to the Shariah. This position of Islam has been frequently reiterated by the Shariah. There are people who are so naive as to wonder why the scholars of Islam consider charging rent on a landed property permissible, but declare interest on the capital prohibited. The contention of these people is that if some property is gi0en on rent, then the very basis on which we justify charging rent, should equally justify charging rent on the capital. Why one sort of rent is permissible and the other prohibited? Actually this confusion between the two different issues is either due to misunderstanding or willful distortion of the truth.
First, the principle of the Shariah is that only that thing could be lent which itself could be consumed. For example currency notes, coins, gold, silver, wheat and sugar etc. But on the contrary, those things that are not consumable but could be utilized frequently by the same person or by several persons could be given to someone for temporary use, but could not be given by way of loan. For example house, car, book, pen and other similar things of frequent use. Therefore, interest could be charged on gold and silver because these could be lent but could not be charged on land and immovable property because these can be given for use but cannot be lent.
Second, if immovable property is lost or damaged due to a natural calamity, then the loss is that of the lessor/owner, rather than the lessee. But someone who borrows capital for doing business, if his business is lost, he will have to return the capital to the creditor. Because in the latter case, the risk is not that of the owner, but that of the debtor who is doing business. Hence there is a wide difference between the two. And the Shariah clearly distinguishes between the two situations.
There is another dimension of this issue. It might sound surprising strange to the economists, who might also regard it as surprising, but the Shariah holds a different view of the question of loan and credit. Anyone least familiar with the teachings of Islam, knows that Our'an and Sunnah emphasized abstention from debts and liabilities, and have taught the supplicant to seek protection of God against debts and liabilities. Debt has been generally viewed with disapproval in Islam. That is why the basis of trade and business is participation, partnership and sharing and not on debts and loans. Islam provides for a model of trade which is based on a system of sharing profits and losses by the participants subject to a solemn agreement between them. Therefore, all this system of trade and commerce revolving around borrowed capital is incongruent with the principles of Islam. All this present system of usury is based on loans. There is a person who is earning millions of rupees daily. Yet he does not invest in it anything from his own pocket. He has taken all the loans from the banks.
The most important feature of the modern banking system which is to be noted in the context of the elimination of Riba is that it is based entirely on credit and loan. It seems that credit. to the exclusion of anything else, has become the life‑blood of modern economy. Not only big businesses, heavy industries and the whole sphere of the corporate financing but also day to day national needs and family requirements have become dependent on credit and loan. The greater the economy the larger the role of credit and loan. In most of the developed economies, the majority of the citizens are heavily burdened with loans and credits of various kinds and dimensions. It appears that the life, dignity, property, honour and even freedom of people, not only on the national level but also at the international level is mortgaged to the creditors whose power and influence is constantly on the rise. This situation is undoubtedly inconsistent with the teachings of Islam where loan and credit has been considered to be an evil which may be resorted to only in very rare and exceptional case of extreme necessity. The Prophet of Islam (s.a.a.w.) sought refuge and protection of the Almighty from the horrors and evils of credit and loan.
The most prominent demonstration of rising power of the credit is the modern banking system given to us by Western capitalistic economy. The entire structure of the banking system is founded on the organization and management of various forms of credit and financing through loans, lending and borrowing. There have been different reasons and factors which have led the Western world to this situation. We need not enter here into those details as they lie outside the scope of this discussion. However, one thing is clear that the practice has emerged from the unauthorized sale and purchase of the deposits and securities kept with goldsmiths for purposes of security and safety. Almost all the writers agree that the goldsmiths soon realized that the depositors use only a little portion of their gold while the rest always lay with them and, therefore, they secretly and discretely started issuing instruments against the securities of peoples deposited for `safe' custody with them. They started earning money on the basis of these instruments which, later became the basis of currency and paper money. The role of the church and monastic orders was not less significant in popularizing this practice. Virtually breaking the confidence reposed in them by the innocent masses, the churchmen and monists also validated the practice of goldsmiths and started minting money on the strength of the cash, gold and silver kept with them for safety and security.
Late Professor Shaikh Mahmud Ahmad, a leading thinker and a senior economist of our country had devoted a considerable part of his life to the study of the theory of interest. The result of this study are embodied in the book Man and Money, printed posthumously in Lahore. According to iris findings interest‑based economy leads to such insurmountable economic problems as unemployment, inflation, fiscal deficit, deficit financing and business fluctuations. These are only some of the many incurable diseases of which the western economics does not appear to possess any dependable remedies. These precisely are the issues which are of the highest concern to the common man all the world over. The difficulty of the western economics, according to him, is that the remedies suggested by it for unemployment are the ones that add to inflation, and the ones for curing inflation are those that increase unemployment. The late scholar notes with great concern that there is little logic behind these prescriptions, and finds that these are not distinguished for clear thinking, in so far as these confine to respective symptoms, rather than the causes that lead to their emergence.
Dr. Muhammad Umar Chapra addressed the Court on March 17, 18 and 19, 1999. He presented an overall survey of the issues and problems involved in the question of eliminating Riba from the economy of Pakistan.
He started with the question of the rationale of the prohibition of Riba by Islam. He did not agree with the belief of some people that interest or Riba was prohibited mainly because it involves injustice. He also dealt with the history of the establishment of Islamic banking institutions from the establishment of Mit‑Ghamar in Egypt in 1963 to the latest experiment made in the field in some modern Muslim countries. He also pointed out that the concept and principles of Islamic Banking have attracted the attention of leading western banks and some international financial institutions. In the context of this discussion he identified the problems and difficulties involved and examined the criticism advanced against Islamic Banking by some scholars. We will come to the question of problems and difficulties later.
The question of rationale of the prohibition of interest by Islam has been dealt with by Dr. Chapra in his prestigious publications on the subject as well as some articles written for popular consumption. His book Towards a Just Monitary System, submitted by him to the Court, contains valuable discussion on the question of rationale. The gist of Dr. Chapra's thoughts on the subject is embodied in a note submitted by him to the Court. Discussing the wisdom of the prohibition of interest Dr. Umar Chapra says that the consideration of injustice inflicted upon the poor does not go far enough towards the full rationale of this prohibition. It is neither historically supported by the evidence nor is consistent with the theoretical framework of the economic system of Islam.
During the Prophet's time (may the peace and blessings of God be upon him) borrowing was primarily undertaken not by the poor but by tribes and rich traders who operated as large partnership companies to conduct large‑scale trade. This was inevitable. The difficulty of the circumstances, toughness of the terrain, harshness of the climate and primitiveness of communication made the task of trade caravans difficult and time ?consuming.
It was not easy for the Arab traders to make business trips to the commercial centres as frequently as the need demanded. They would, rather, confine to‑ two trips every year, the Winter Trip and the Summer Trip. It was necessary for the caravans to muster all available financial resources to purchase the local exportable products, sell them abroad, and bring back the entire needs of their society for imports during a specific period. Before Islam, such resources were mobilized on the basis of interest. Islam abolished the interest‑based nature of the financier ?entrepreneur relationship and reorganized it on a profit‑and‑loss sharing basis. This enabled the financier to have a just share in the enterprise, but the entrepreneur was not crushed by adverse conditions ‑ such as the caravan being waylaid on the journey. This demonstrates that although the extension of meaningful help to the poor carries a high priority in the Islamic value system, it is not the only reason for the proscription of interest. The primary reason is the realization of overall socio‑economic justice, which is declared by the Qur'an to be the main mission of all God's Messengers[57:25].
Justice, however, is not a hollow term. It has several implications, the most important of which is that the resources provided by Allah to mankind must be utilized in such a manner that the universally‑cherished humanitarian goals of general need fulfilment, full employment, equitable distribution of income and wealth, and economic stability, are realized. These humanitarian goals cannot be realized without a humanitarian, strategy. An important, though pot the only, element of such a strategy is the abolition of interest. This would necessitate the reorganization of financial intermediation on the basis of equity and profit‑and‑loss sharing; and making the financier share the risks as well as the rewards of business, and not assuring him of a predetermined rate of return irrespective of the ultimate outcome of business.
Financial intermediation on the basis of interest tends to allocate financial resources among borrowers on the criteria of their ability to provide acceptable collateral to guarantee the repayment of principal, and sufficient cash‑flow to service the debt. End‑use of financial resources does not constitute the main criterion. Hence, financial resources go to the rich, who fulfil both the criteria, and also to Governments which, it is assumed, will never go bankrupt. However, the rich borrow not only for investment but also for conspicuous consumption and speculation, while Governments borrow not only for development and public well‑being, but also for defence and big projects. This contributes to a rapid expansion in unproductive and, at times wasteful, spending and, besides accentuating macro‑economic and external imbalances, squeezes resources available for need fulfilment and development. This explains why even the richest countries in the world, like the United States, have been unable to fulfil the essential needs of all their people in spite of abundant resources at their disposal.
The unproductive and wasteful spending which the collateral ?linked, interest‑based financial inter‑mediation has the tendency to promote, has led to a decline in savings in almost all countries around the world. Even in the industrial countries, net national saving as a percentage of national income declined by almost 4 % between the 1960s and the 1980s. The world saving shortfall has been responsible for persistently high levels of real interest rates. This has led to lower rates of rise in investment, economic growth and employment. Unemployment has hence become one of the most intractable problems , for all countries, including the rich industrial world. Unemployment stood at 8.6 per cent in Europe in 1988‑?90, three times its level of 2.9 per cent. in 1971‑‑73. It is not expected to fall significantly below this level in the near future because a real rate of economic growth of 3.5 per cent. is required to prevent unemployment from rising, and European growth has been below this benchmark since 1976 Even more worrying is the higher than average rate of youth unemployment because it hurts their pride, dampens their faith in the future, increases their hostility towards society and damages their personal capacities and potential contribution. Given the budgetary constraints, the ever‑looming threat of inflation, and the prospect of low growth rates continuing in the foreseeable future. the possibility of attaining full employment in the Western world is not very bright, A decline in wasteful spending and a rise in savings and investment would be very helpful. But this is not possible when the value system encourages both the public and the private sectors to live beyond their means and the interest‑based financial intermediation makes this possible by making credit easily available without due regard to its end use. If, however, interest is prohibited and banks are required to share in the risk and rewards of financing, they will be more careful in lending. Wasteful spending will decline and more resources will become available for productive investment and development. This will lead to higher growth, a rise in employment opportunities, and a gradual decline in unemployment.
The inequitable allocation of financial resources in the conventional" interest‑based financial system is not widely recognized. According to Arne Bigsten, the distribution of capital is even more unequal than that of land', andthe banking system tends to reinforce the unequal distribution of capital'. The reason, as already indicated, is that interest‑based financial intermediation relies heavily on collaterals, giving inadequate consideration to the strength of the project or the ultimate use of financing. Thus, while deposits come from a cross‑section of society, their benefit goes mainly to the rich. The Islamic financial system can be more conducive to the realization of equity‑. Risk‑and‑reward sharing would compel the financier to give due consideration to the strength of the project, thus making it possible for even the poor but competent entrepreneurs to get finances if they have worthwhile projects. A large number of small and medium enterprises would thus be able to get finances from financial institutions without being able to offer the collaterals. This should enable the society to harness the pool of entrepreneurial ability from even among the poor. The rich contribution that such entrepreneurs can make to output, employment and need fulfilment would thus be tapped.
According to Dr. Umer Chapra, there is no reason to be unduly apprehensive about loan losses from such financing. The experience of the International Fund for Agricultural Development (IFAD) is that credit provided to the most enterprising of the poor is quickly repaid by them from their higher earnings. Other small‑loan programmes have yielded similar results in several countries. .
The rate of interest has become one of the most important destabilizing factors in the present‑day world economy. Milton Friedman, a Nobel Laureate, attributed the unprecedently erratic behaviour of the U.S. economy to the erratic behaviour of interest rates. The high degree of interest rate volatility injects great uncertainty into the investment market. It makes the share of interest in the total return on invested capital (interest + profit) to continually fluctuate. This makes it difficult to take long‑term investment decisions with confidence. It drives borrowers and lenders alike into the shorter end of the financial market, thus bringing about a shift in the short and long term commitment of funds, and between equity and loan financing. Fluctuating interest rates also create gyratic shifts in financial resources between users, sectors of the economy and countries, causing erratic movements in loan based investments, commodity and stock prices, and exchange rates. With every rise in the rate of interest in a floating rate system in a short‑ended market, there is a rise in the rate of business failures, not because of any inefficiency or slackness on the part of the proprietor, but because of sudden decline in profit which is the entrepreneur's share in the total return on capital. Business failures mean not only personal financial losses to proprietors and stock‑holders. but also a decline in employment, output, investment and productive capacity ‑ losses which take longer. and are more difficult to make up All these factors have, no doubt, serious implications for economic activity and stability.
In a wholly equity‑based system, the entrepreneur's share in the total return on capital would depend on the profit‑sharing ratio and the ultimate outcome of the business. The profit‑sharing ratio between the entrepreneur and the financier cannot fluctuate from day to day or even month to month like the rate of interest because it would be determined by custom and considerations of justice and remain contractually stable throughout the duration of the financing agreement. Since the ultimate outcome of business depends on a number of factors which do not change erratically, an equity‑based economy would therefore tend to be more stable than a loan‑based economy. This has been recognized by a number of prominent Western economists.
Dr. Chapra considers the prohibition of interest an indispensable part of the strategy of any system which believes in the brotherhood of mankind and wishes to actualize the humanitarian goals of need fulfilment, full employment. equitable distribution of income and wealth, and economic stability. The reason why capitalism has not been able to realize these goals is that there is a conflict between its goals and its strategy. The goals are humanitarian, originating from its religious past, while the strategy is social? Darwinist, based on the concept of the survival of the fittest. For the allocation of scarce financial resources, capitalism relies primarily on the rate of interest, which gives an edge to the rich and leads not only to a concentration of wealth but also a rise in conspicuous and wasteful consumption. This hurts the goal of need fulfilment and contributes to a slower growth in saving, investment, employment and output, thus frustrating the realization of overall human well‑being.
Counsel for the Federation and several other experts including Mr. Khalid M. Ishaque, Dr. Muhammad Aslam Khaki and Hafiz Abdul‑ur?Rehman Madani, have submitted that the main and the primary cause of the prohibition of interest is Zulm or injustice. Dr. Muhammad Umar Chapra M has also dealt with this issue at length in some of his written documents M presented to us. Let us, here, examine the meaning, scope and contours of M zulm in this context.
In order to understand the rationale of the prohibition of interest. one should also look into the objectives or the Maqasid of the Shariah. The financial policy of Islam has to be commensurate with these objectives. If it is not, the objectives would be defeated. In this context when we look into: Qur'an we find that the establishment of ist or real justice is the primary and central objective of
Islam. The Qur'an and the Sunnah have both placed tremendous stress on justice.
According to the Qur'an, establishment of real justice (Qist: just, Qistas:
Justice) the primary purpose for which Allah has sent down His prophets
(Qur'an: 57:25). The Qur'an places justice nearest to Taqwa (Qur'an, 5:8), in terms of its importance in the Islamic scheme. Righteousness or Taqwa is the most important because it serves as a springboard for all rightful actions, including justice. The Holy Prophet (peace be upon him) equated the absence of justice with "absolute darkness". (Sahih Muslim (1955), Vol 4, p. 1996: 56, Kitab al‑Birr wa al?Silah wa al‑Adab. Bab
Tahrim al‑Zulm, from Jabir Ibn Abdullah). The Prophet (peace be upon him) has used the word . zulumat in this Hadith. Zulumat is the plural of zulmah or darkness, and signifies several layers of darkness, leading ultimately to pitch' orabsolute' darkness, as is also evident in the
Qur'anic verse, 24:40. This is but natural, because injustice undermines brotherhood and solidarity, accentuates conflict, tensions and crimes, aggravates human problems, and thus leads ultimately to nothing but t agony and ordeal in this world and misery and condemnation to Hellfire in the Hereafter.
Brotherhood or Ukhuwwah whose establishment is an ideal for Muslims to be achieved becomes a meaningless jargon if it were not sustained by justice in all walks of life particularly in the allocation and distribution of God‑given resources.
All leading jurists throughout Muslim history have, therefore, without any exception, held justice to be the foundation stone of the Maqasid al‑Shariah. For example, Imam Abu Yusuf laid considerable stress on justice in his letter to Caliph Harun al‑Rashid by saying that: "Rendering justice to those wronged and eradicating injustice, raises tax revenue, accelerates development of the country and brings blessings in addition to reward in the Hereafter". A great Shafi'e jurist and a political thinker of note, Abul Hasan Mawardi stressed that comprehensive justice "inculcates thutual love and affection, obedience to the law, development of the country, expansion of wealth, growth of progeny, and security of the sovereign", and that "there is nothing that destroys the world and the conscience of the people faster than injustice". The celebrated revivalist thinker and the renowned Hambali jurist Ibn Taymiyyah considered justice to be an essential outcome of Tawhid or belief in one God. To him justice is a very wide concept ‑ "everything good is a component of justice and everything bad is a component of injustice and oppression. Hence, justice towards everything and everyone is an imperative for everyone and injustice is prohibited to everything and everyone. Injustice is absolutely not permissible irrespective of whether it is to a Muslim or a non‑Muslim or even to an unjust person". Ibn Taymiyyah refers to the well‑known saying `attributed to Hazrat Ali that "Allah upholds the just state even if it is unbelieving, but does not uphold the unjust state even if it is Islamic", and that "the world can survive with justice and unbelief, but not with injustice and Islam". The great philosopher of history and the founder of the Science of Sociology Ibn Khaldum stated unequivocally that it is not possible for a country to develop without justice, something that has now been belatedly recognized by the pundits of development economics after a long flirtation with injustice. Ibn Khaldum goes to the extent of emphasizing that "oppression brings an end to development and the end of development becomes reflected in the breakdown and destruction of the state, and that "a decline in prosperity is the necessary and inevitable result of injustice and transgression". He elaborated further that, "oppression does not consist, merely in taking away wealth and property from its owner without cause or compensation. Oppression has rather a wider connotation. Anyone who seizes the property of others, forces them to work for him against their will, makes unjust claims on them, or imposes, on them burdens not sanctioned by the Shariah, is an oppressor".
Given the importance of justice in Islam, there arises the question of its implications. Justice is a comprehensive term in Islam and covers all aspects of human interaction, irrespective of whether it relates to the family, the society, the economy or the polity, and irrespective of whether the object is a human being, animal, insect or the environment. This has wide implications, one of the most important of these is that the resources provided by God to mankind should be treated like a trust and must be utilized in such a manner that the well being of all is ensured, irrespective of whether they are rich or poor, high or low, male or female, and Muslim or non‑Muslim. In the field of economics, one could assert that justice demands the use of resources in such an equitable manner that the universally cherished humanitarian goals of general need fulfilment, optimum growth and full employment, equitable distribution of income and wealth, and economic stability are realized. These humanitarian goals are recognized by almost everyone everywhere. They are the outcome of moral values provided by most religions. However, it is the strategy for realizing these which makes a difference. These humanitarian goals cannot be realized without a humanitarian strategy. The strategy requires, among other things, the injection of a moral dimension into economics in place of the materialist and hedonist orientation of capitalism. Abolition of interest is a part of this moral dimension. This is perhaps one of the reasons why Islam is not alone in condemning interest. All other major religions, including Judaism Christianity and Hinduism have also condemned it. The Bible makes no distinction between usury and interest and brands those who take interest as wicked.
Even though the extension of help to the poor and the raising of their socio‑economic condition enjoys a high profile in the Maqasid al?Shariah, confining the rationale behind the prohibition of interest to just this limited objective is not only factually wrong but also unduly restrictive in terms of the concept of justice in Islam. During the Prophet's time, may the peace and blessings of God be on him, the Muslim society had become so well organized in terms of mutual care that the needs of the poor were automatically taken care of by the rich. To the extent that this did not happen, the Bayt al‑Mal was there to fill the gap. The poor were not, therefore, constrained to borrow to fulfil their basic needs. Since there was no conspicuous consumption of extravagance in marriages and other festivities there was no need to resort to borrowing for this purpose as well.
Throwing light on the distributive justice in Islam, in his written statement submitted to us, Dr. Muhammad Umar Chapra refers to the example of Pakistan. He says Pakistan is a very clear example of how excessive borrowing squeezes resources for need‑fulfilment. Governments in Pakistan have borrowed right and left until debt‑servicing (interest + amortization) has reached 46 per cent. of total Central Government spending in the 1998‑99 Budget. Since another 24 per cent. of the total is allocated to defence and 12 per cent. to administration, only 18 per cent. remains for' development spending, including education, health and infrastructure construction. This is far less than what Pakistan needs to fulfil its dream of becoming an Asian tiger. If the Government of Pakistan had taken the Islamic injunction against interest seriously, it would have tried to reduce its deficits with a view to minimize its borrowing. It would have streamlined the tax collection system and also reduced its unproductive and wasteful spending. A number of projects which were undertaken by the Government and which have proved to be sour would have been avoided. The Far Eastern countries adopted fiscal discipline, while Pakistan, which should have done so all the more because of its commitment to Islam, did not do so. Pakistan is, of course, not alone in this predicament. A number of other countries are in a worse condition. Suggesting the basic ingredients for sustained growth in a modern economy Dr. Chapra refers to saving, investment, hard and conscientious work, technological progress and creative management, along with helpful social behaviour and Government policies. As far as saving is concerned, its positive effect on growth is now well established. It helps raise capital formation, which in turn helps raise output and employment. A well‑established fact is that high saving countries have generally grown faster than low saving countries. The central importance of saving brings into focus the likely effect of Islamic values and institutions on aggregate savings? It is now well recognized that since Islam prohibits extravagance, status symbols and living beyond means, there should be a positive effect of Islamic values on saving. Moreover, studies conducted in conventional economics have indicated a strong link between the households' access to credit and the savings rate. High saving countries like Japan and Germany have tax systems that tend to discourage consumer borrowing. On the basis of these findings, it may be hoped that the adoption of the profit and loss sharing system would help raise savings provided we totally close the doors of credit to both the public and the private sectors for unproductive purposes, as it has always been a major drain on savings. It may be mentioned here that some experts who appeared before us explained to us how over the last hundred years the equity premium has been substantially high in the U.S. On the other hand, the hyper‑inflation of the 1920s wiped out bondholders altogether in Germany, and the post‑World War‑II hyper‑inflation did the same in Japan. Equity investments involve greater risk, and everyone may not be willing to bear that risk, or some people may prefer to have less risky modes. All these are available within the Islamic framework. Hence, what is important is the availability of, and easy access to, investment opportunities. of varying risks and maturates to satisfy different preferences of the savers.
Having discussed nature, classifications of Riba and the impact of 1p its prohibition on trade and business, as well as the wisdom in the p prohibition of Riba, question of inflation which is set up as a formidable p problem in the context of the elimination of Riba may be analysed.
The question of inflation is, undoubtedly, an extremely important question and poses a challenge to the scholars of Islam as well as to the economists and financial experts. There is no denying the fact that the value of the paper‑currency has a trend of continuous decrease in inflationary situations. If a debtor who has borrowed a particular amount of paper? currency repays the same amount to his creditor after a substantial time, the creditor suffers the effects of inflation. If he demands his debtor to pay more in order to compensate him for the loss of value he has suffered, the question arises whether this demand would be treated as a demand of 'Ribs'? If the required increase is Riba, then what‑is the remedy to the problem?
A section of our scholars and bankers is of the view that such increase is not to be treated as Riba. According to this view, the introduction of paper currency has led to persistent inflation in the modern world, thereby continuously eroding the real value or purchasing power of money. There are other causes of inflation also. In an inflationary situation, compensation for depreciation of money over a period of time in a situation of inflation should, according to this view, be justified. If compensation is not given in such a situation it would be tantamount to penalizing creditors or savers, including those with small means. Mr.Sartaj Aziz in the statement submitted to this Court recording his views as an economist and not in the capacity of Finance Minister, suggested that a clear consensus on the subject of indexation is necessary to clarify that any compensation paid for the loss of value is not `Riba'. It was also pointed out that the concept of compensatory cost as provided in section 35 of C.P.C. has not been held by the Federal Shariat Court to be contrary to tote Injunctions of Islam. On the other hand, there is another view which does not favour interest or indexation as the possible solutions to the problem of inflation. According to this view, the real cause of erosion in the value of money is to be sought in the wrong monetary and economic policies which result in crude deviations from a state of price stabilization. There can be no two opinions that one of the major objectives of Islamic monetary policy is stabilization of the value of money. In the Islamic context money is primarily a medium of exchange and a measure of value. It is also a measure for deferred payment and as such its value has to be protected. According to this latter view there is no substance in the thesis that interest is a reward for erosion of the value of money. The discussion in economics relating to the nominal rate of interest and the real rate of interest must not confuse us, because the rationale for interest is one thing and the phenomenon of inflation and various ways to reduce, if not to mitigate, the evil consequences of inflation, is a different matter altogether. In his written statement submitted to this Court, Prof., Khurshid Ahmad argued that challenge should not be mixed up with the problem of inflation which is many‑dimensional and must be addressed to separately in its own right. According to him it is illogical to argue in favour of interest on the basis of inflation. Indexation is one of the many ways suggested to fight some of the effects of inflation but the results of such a policy are mixed and inconclusive, if not adverse. In fact, a lot‑of empirical evidence about movements in interest rates and rates of inflation leads to conflicting hypotheses. Prof. Khurshid Ahmad considers it difficult to find out a positive correlation between the two in all parts of the world and even in the same country over a long‑period/time horizon. That is why under a regime of inflation even negative rates of interest have prevailed over certain time periods. The trends that emerge from empirical and econometric studies remain inconclusive if not erratic. The remedy for erosion in the value of money lies in a monetary policy aimed at price‑stabilization and not in retaining interest under any title or pretext.
The examination of the question of inflation undertaken hereunder is based mostly on the material placed by a number of experts in response to the questionnaire circulated by this Court. It is not the domain of this Bench to frame fiscal policies for the country, the discussion, therefore, contains the views expressed in the material referred to us and the views urged during hearing for the guidance of those whose duty is to frame monetary and fiscal policies and then implement the same in the best interest of the country.
Although the problem of inflation is a world‑wide phenomenon, yet there is hardly anything to be termed as a consensus on its definition. The term has always been highly controversial among the economists and has undergone several changes during the last three quarters of the century. In the context of our discussion, however, we can use the term inflation' in the sense of unreasonable, uncontrolled price‑rise caused by excessive increase in the quantity of money resulting in the rapid loss of the purchasing power of money. It may be pointed out here that the problem of inflation is peculiar to the fiat money or the paper currency.
Standard money or full‑bodied money never had this problem in such proportion. The termmoney' is defined as something capable of storing the value, serving as a dependable standard for deferred payments and an easy and quick medium of exchange. But inflation virtually robs the fiat money of its two former characteristics, namely, the store of value and a standard for deferred payment. Inflation goes on to reduce the chances of securing growth and progress in the field of economic activity. An inflated economy soon loses its stamina to compete with other developing and developed economies operating in the world market and the balance of trade is greatly disturbed and the exchange rate starts suffering from rapid depreciation.
Briefly speaking, following are considered to be the causes of inflation:‑‑
(1)??????? Monetary expansion i.e. the increasing supply of money;
(2)??????? Deficit financing;
(3)??????? Too much bank financing;
(4)??????? Increased and uninvested foreign remittances;
(5)??????? Increasing and uncontrolled urbanization in a society;
(6)??????? Rising disequilibrium between demand and supply of goods;
(7)??????? Scarcity of supply (due to natural causes);
(8)??????? Scarcity of supply (due to temporary causes);
(9)??????? Rising costs on account of excessive wages etc.;
(10)????? Rising costs due to heavy taxes;
(11)????? Rising costs due to exorbitant rates of profits;
(12)????? Devaluation of currency;
(13)????? Impact of the international market;
(14)????? Inefficient use of resources.
??????????? Inflation in the sense of galloping rise of prices at the hands of unhealthy economic or market tendencies is not something to be tolerated under Shariah. Undoubtedly, this kind of price‑hike causes hardships and creates difficulties for the people. Therefore, it must be eliminated at source under the principle of Al‑darar yuzal i.e. hardship or damage must be eliminated, as well as under the principle of Al‑Mashaqqah TWO al‑Taisir i.e. hardship invites convenience. Apart from these general principles, there are some verses in the, Qur'an which require a Muslim Government to take steps for the stabilization of prices. It says "observe the balance equitably with justice and do not let the balance fall short." (55:9).
The question of inflation has close relationship with the question of prices and their control with a view to ensure that they do not go beyond the reasonable limit. Rapid and sharp fluctuation in the prices is not approved under the Shariah. Although the Shariah does not allow price control mechanism as a rule, as long as the prices are determined in the open market under the normal application of the law of demand and supply, but in exceptional cases where the freedom in the open market is misused and prices are raised in an unnatural way, the State is under an obligation to control them and ensure that the public (including the consumer, the producer and the middle‑man) does not suffer at the hands of each other. The Fiqh literature has taken notice of the devaluation of money and quite a substantial discussion is found in our classical books on this subject. Paper currency was not prevalent in those days and, therefore, we do not find sufficient mention thereof in our Fiqh books. However, token money was in vogue and the jurists have discussed the consequences of their devaluation or total demonetization. In case of devaluation, there is an absolute unanimity that in all deferred payments the question of the devaluation of the coins (token money) will be ignored and the same amount or quantity of money will have to be paid as was originally agreed in total disregard of the difference of value of the token money at the time of loaning and at the time of making payment. In case of complete demonetization, according to a group of jurists, its value at the time of demonetization will be paid. Some modern Muslim scholars have tried to make out a case for indexation to meet the challenges of inflation on the basis of this last‑mentioned ruling of our jurists. But a deeper study of this ruling and the arguments on which it is based will show that it cannot serve as an acceptable basis for indexation. But before we dilate upon the Shariah position about indexation let us briefly touch upon the history and techniques of indexation as are prevalent in different countries.
Indexation as a regular economic device to make up the deficiency caused to a person due to inflation was first adopted in UK in the early decades of the present century. But it? was used to benefit the workers in their wages. It seems that the initial apparent success to meet the problem (mind that it was in the field of wages) involved other countries to follow suit in the coming decades. By the seventies the practice became popular in almost the entire Europe and America as well as some eastern countries. But the history of indexing capital is also not very old. It dates back to mid?-twentieth century. Finland was, perhaps, the first country which made an experiment in trying indexation of capital (bonds, deposits etc.) as a solution to overcome inflation. This experiment gradually moved forward over a long period of more than a decade. It seemed that the financial planners were moving very cautiously keeping into consideration the process of trial and error. But in spite of this cautious and careful movement in this way, Finland soon had to give up indexation obviously because of its unfavourable results.
There are many forms and techniques of indexation developed in the countries which have adopted this method. Some have indexed only the wages, pensions and various forms of social security payments. Some other countries have indexed different forms of investments and capitals. Yet, in some other countries debts, debentures and securities have been indexed. Then there are innumerable ways of indexing a particular amount of money in different situations. The primary and basic motive of indexation was to restore two important failings caused to fiat money by inflation, namely, its failure to serve as a store of value and its failure to serve as a dependable standard for deferred payments. Indexation as a mean to meet the challenges of inflation captured the imagination of scholars and financial experts in the beginning. Soon it called the attention of the Governments and policy planners in many countries. But it seems that they were soon disenchanted with its projected usefulness in responding to the problems in a positive and lasting manner and several countries soon gave up this practice.
Modern western economists have a strong tendency to accept inflation as something natural or as a necessary evil which is only a concomitant of economic growth and technological development. Instead of admitting their failure to counter it they have now started to justify it on many counts. But in spite of their efforts to justify inflation up to a certain limit they could not agree as to what is that reasonable limit beyond which inflation was to be arrested. There is still a wide difference of opinion about the reasonable limit of price rise. The idea of indexation is, in fact, an acknowledgement on the part of economists of their failure to counter inflationary tendencies. Indexation is an effort to institutionalize inflation and to ensure its perpetuation in the national economy of a people.
Indexation has been claimed to constitute a positive contributory factor for the growth of savings in an economy hit by inflation as it would ensure the preservation, though partially in some cases, of the original value of the fiat money at the time of savings and deposits. But a deeper examination of this claim shows the weakness of the entire argument. Even, if it is accepted as a favourable factor in the increase of savings, it cannot be accepted as a valid argument in terms of Shariah. For, merely the growth of savings at the cost of perpetrating a Riba‑based practice which also involves other objectionable elements cannot provide a sound basis for allowing this practice.
The Council of Islamic Ideology had examined indexation as one of the possible alternatives to interest and came to the conclusion that it could not be accepted as a valid mode to face the problem of inflation. It rejected indexation both on grounds of Shariah as well as on purely economic grounds. For example, the Council observed, indexation of bank advances would place the agricultural sector in a disadvantageous position compared to sectors where price rise was equal to or more than the rise in the general price level, because the, increase in the prices of agricultural products was less than the rise in the general price level. However indexation of wages and salaries paid to the employees does not create a big problem and may be justified under Shariah with some minor adjustments. But the question of indexing bank deposits, advances and investment loans certainly constitutes a big problem. It involves several elements which render it objectionable under Shariah and has been assailed on various counts.
We may point out that discussion here pertains to the indexation of loans, advances and various forms of credit only, and the arguments advanced by some scholars to support indexation as a valid and lawful device to meet the consequences of inflation were briefly as under:‑‑
(i)???????? The indemnification of damages caused to any body by a person without any fault or failure on the part of the former is one of the basic principles of the civil law of Islam. All mutual dealings and commercial transactions between the parties take place on the basis of a set of principles laid down by the Shariah. There are several legal maxims throwing light on the question how to remove or indemnify a damage. These principles and maxims are based on a well‑known Hadith: La darar wa la dirar i.e. " no damage and no counter damage". Some Islamic economists have based their agreement in favour of indexation on this Hadith arguing that inflation is a damage because it steals away the purchasing power of one's money and decreases its value and, therefore, it must be indemnified under this Hadith and, it is asserted, that the only way to indemnify the damage is to adopt the principle of indexation. Although this argument appears to be a strong one in favour of indexation but, as we shall see later, if we examine it more closely it becomes evident that instead of supporting the indexation, it goes against it.
(ii)??????? Inflation and indexation are entirely new phenomena and were completely unknown to our early jurists. Therefore, the principles developed by them to respond to their economic and monetary requirements cannot be expected to meet the challenges of the modern world. As such, we need a new Ijtihad in respect of inflation and indexation problems and, therefore, we have to develop some mechanism to make up the lost purchasing power of money and give some relief to the lender.
(iii) Some people argue that the Qur'anic verse "and establish the weight with justice and do not cut the scale. short," requires that the weight (a term which these scholars try to equate with the purchasing power) of people's money should not be cut short. But a deeper examination of the verse proves just the opposite. Establishment of weight with justice require, that the interests of both, the creditor and the debtor, be protected. If the tilt is visibly in favour of one of them it would be contrary to the purport of the verse.
These arguments have been discussed alongwith scores of others not only in Pakistan by the Council of Islamic Ideology but by other Muslim scholars outside Pakistan on several forums but the overwhelming majority of Muslim scholars could not convince itself of the permissibility of indexation under the Shariah, mainly on following grounds.
The most important argument against indexation is that it places the burden caused by the inflation upon someone who is not responsible to create it. Inflation in third world countries is mostly caused by various policies of the Governments, such as deficit financing, unnecessary monetary expansion, devaluation of currencies etc. In such a situation, it would be contrary to the Islamic principles of justice to place its burden on someone who is not responsible to create it. The Qur'an clearly lays down La Taziru Waziratun Wizra Ukhra? i.e. no bearer of a burden shall bear the burden of another. (Qur'an 35:18; 53:38).
However, basic argument of the Council of Islamic Ideology in rejecting indexation as a valid mechanism to overcome inflation was that it involves Riba because the basic principle laid down by the Shariah in this regard is that in the borrowing and loaning of fungible things the same quantity and or number of units should be returned as was borrowed or loaned even though the price of the commodity may have changed in the meantime. While discussing the Shariah position about indexation we should not forget that the success of indexation in achieving its two basic objectives for which it was introduced has been highly disputed. Indexation has failed to deliver the fruits on both the counts: it could not secure a fool‑proof guarantee to protect the character of money as a store of value as well as a dependable standard for deferred payments. In any case, indexation as such represents a defeatist tendency on the part of its advocates and shows that inflation has been acknowledged as an inevitable evil and that more serious efforts to control it have been given up. This simply means a perpetuation of inflationary tendencies in the national economy.
Moreover, indexation would lead to three significant and inescapable results which are objectionable from the Shariah point of view:
(i)???????? It would become extremely difficult to draw a definite dividing line beyond which the plea of purchasing power should not be used. This will give rise to innumerable disputes and will place dark clouds of uncertainty over all the transactions based on deferred payments ‑ a situation called Gharar in Shariah and is disallowed.
(ii)??????? There will be much more disputes on the question of converting the purchasing power clauses of various contracts and agreements into actual monetary terms. This is again Gharar and renders transactions invalid.
(iii)?????? There will be a big scope for gambling and speculations about the future value of money.
Partial indexation (for example, indexation of wages etc.) can protect the living standard of those to whom it is applied but only at the expense of those whose wages and incomes have not been protected. It only implies the assumption that some income is more respectable than the rest and hence should be subject to lesser risks of change than the rest. This is in flagrant violation of the Shariah which upholds absolute justice and equality.
The tendency of the Shariah is to provide support and protection to the poor debtor. The Qur'an exhorts the creditors to give respite to a debtor incapable of making repayment till such time when he is in a position to pay. But in the system of indexation the whole burden caused by the depreciation of the value of money has been placed on the shoulders of the debtor. He has to bear the burden of something he is not responsible to bring about. This is contrary to the Qur'anic principle that no souls will be required to bear the load (i.e. liability) of the deeds ,of others. Inflation is always a continuous process and is also beyond the control of the individuals. A paper money gets inflated wherever it may happen to be. If it is hoarded in the cellars of the capitalist it is not free from being subject to inflation. Now, if he gives it on loan to anybody, why the debtor alone should be responsible to make up the loss caused by inflation?
The entire thinking and philosophy working behind the concept of indexation is Riba‑based economic thinking. In Islam; the transactions for productive and investment purposes would be based on Musharakah and Mudarabah in which no question of indexation arises. Indexation is only an effort to secure additional money over and above the principal amount, without putting any labour or running any risk, merely in the name of protecting the purchasing power. The Riba‑based mentality also tries to secure additional money without any labour or risk. Indexation places additional burden of indemnifying the loss of purchasing power of money on one of the following:
(i) the Public Exchequer;
(ii) the employer;
(iii) the borrower;
(iv) the debtor;
(v) the banker.
Now, in all these cases, any party on whose shoulder this additional burden is placed will always be at a disadvantageous position as compared to others. In case the burden is placed on the Public Exchequer, it would mean that all deferred payments shall be subsidized by Government a situation which is not the intention of even the advocates of indexation. In case of others, this will be contrary to many norms and principles enunciated by the Shariah for a free and just commercial dealing between the parties. The tendency of the Shariah is to lessen the burden as far as possible. It requires that least possible burden should be placed on the individuals by minimizing the regulatory laws, simplifying the procedures and avoiding unnecessary technicalities. The basket‑price system, with all its variations proposed by the exponents of indexation, will place the common man in such a difficult position that the objectives of the Shariah will have to be compromised.
A fundamental principle of the Shariah which must be kept in view while formulating a new policy or adopting a new method or technique is that of Sadd al‑Dhariah or the Foreclosure of the Door. Under this principle anything which may produce results contrary to the policy of the Shariah must be prohibited and controlled even if it may be originally and initially lawful. There are many examples in the Shariah in which permissible things were prohibited because they were expected to lead to bad consequences. Now, the indexation allowed primarily by the banks and other financial institutions in loan contracts will have far‑reaching repercussions particularly on private loans which are mostly given on personal basis for consumption purposes. As soon as indexation takes ground, individuals will also have to follow suit and this will open the flood gates of all notorious usurious practices condemned even by the few modernists who are reluctant to consider commercial interest as‑Riba. An important corollary of indexation would be that virtually there would be two standards of money: the existing legal tender, the Pak Rupee and the projected monetary unit contemplated to be used in loan contracts as a unit of purchasing power. If the existence of two monetary units is inevitable, then why not adopt a measure closer to the spirit of Shariah as well as easier to practise and understand. The real answer to inflation, therefore, is not indexation but price stability which conforms to the Islamic ideals of socio‑economic justice. The Islamic law dealing with Tas'ir (price‑control) clearly lays down the objective of discouraging monopoly prices and ensuring of fair, just and reasonably free operations of the market forces.
Dr. S.M. Hasanuzzaman, a renowned scholar, economist and banker, in the statement submitted to this Court has examined the arguments advanced in favour as well as against indexation as a possible answer to inflation. According to him about twenty‑one countries of world have introduced , indexation but the scope of indexation has not been similar in different countries. A large number of countries have indexed only wages, pensions and social security payments. Some other countries have indexed single bonds while many countries have indexed different forms of investments as well. Brazil is the only country where this practice was adopted in a comprehensive manner. It is because of these differences that the modes and techniques of indexation and the choice of index differ with different countries. The most common technique of indexation is linking wage or investment to the prices of consumer goods. Some countries prefer to make advance adjustments with expected prices while most countries practice ex post facto adjustments. The period of adjustment ranges from one month to one year; in some cases the period is even three years.
Dr. Hasanuzzaman reaches the conclusion that the merits attributed to indexation are generally theoretical. On the other hand, the critics of indexation have based their arguments partly on theory and largely on the basis of experience gained in different countries. In the ultimate analysis, indexation would mean that some one has to compensate the sufferer for the damage caused to the purchasing power of money or for decrease in its value. It may be payable by the Government, the employer, the borrower or the banker. In order to examine if the Shariah justifies such a payment by any of these parties we shall have to apply the Islamic Law of compensation and the Islamic principles of Daman to these transactions after we have determined the person or the institution responsible for inflation. In the shariah, the question of return on physical human labour and on the return on financial contribution are governed by two different sets of rules. The former is assigned a fixed remuneration according to the prevalent market rate or Ajr‑i‑Mithl. The Government may, if necessary, fix a minimum rate of remuneration and leave the maximum to market forces. On the other hand, financial contribution in the form of a loan or a debt is to be rewarded exactly in the same kind and quantity; any excess over and above the sum lent would become interest and is strictly prohibited. This fact is borne out from the Qur'an, the Holy Prophet's tradition and the detailed discussions of the fuqaha of all the schools of thought without any exception.
The Muslim jurists are so particular about this Qur'anic prohibition that they have disapproved this practice in all those transactions where deferred transfer of commodity or money is involved. Thus the purview of this prohibition covers not only loans and debts but also credit, barter, deferred exchange of currency, demonetization, delayed payment of remuneration after devaluation or revaluation, indemnity and change in the unit of currency at the time of redemption of loan. Guided by the principles and injunctions laid down in the Ahadith, the fuqaha have held that in case Dirhams of Dinars are lent out by counting, they will be paid back by counting not by weight. Similarly in case these are lent out by weight, they will be returned by weight not by counting. In respect of the loan of a commodity it is further provided by the fuqaha that it should be returned in the same kind and quantity irrespective of any change in its price at the time of return of the lean.
Discussing the question of Fulus. and its relevance to modern day fiat money, Dr. Hasanuzzaman says: In case the amount of loan is in terms of fulus or similar pieces of Dirhams which the Government has banned and which has become out of currency the creditor will take its price. He will not be bound to accept this coin because the defect has occurred when the coin was in the borrower's, possession. The price of Fulus will be fixed on the basis of its value on the date of borrowing and the creditor will take it irrespective of the degree pf defect in its value. But in case the coin, in spite of demonetization, is still in currency and popular, the creditor shall accept the Fulus. This approach is based on a general principle that in the case of loan of fungible goods the creditor will be paid the same quantity of identical goods irrespective of whether the value of such goods increases, decreases, or remains unchanged during the period of loan. The same approach has been followed by the jurists in the case of payment of outstanding wage remuneration. In this context, Dr. Hasanuzzaman draws support for this logic from another ruling of the Hanafi jurists. This ruling relates to the situation that causes liability on account of unlawful occupation of somebody's property (ghasb, usurpation). The usurper (ghasib) is called upon to return the goods or, in the case of destruction of goods, its price whenever the Court orders him to do so. The usurper will not be required to indemnify the loss caused to the value of the property as a result of a fall in its price.
The approach of linking the liability with the purchasing power as made by the fuqaha is very clear and consistent. The same consistency exists in case any liability of deferred payment arises not as a result of a transaction of loan but even when it arises as a result of barter, demonetization, debasement, devaluation or revaluation, remuneration, compensation and indemnity. In all these situations a loan is to be returned in the same unit of currency and in the same amount, irrespective of any change in its relative value in terms of other goods or currency. Any violation of this principle would be a violation of the Qur'anic prohibition of Riba and of the Holy Prophet's injunctions. The fuqaha are so strict in this principle that they do not relax it even in the case of redemption of the liability of dower to a wife. According to Fatawa‑i‑Alamgiri, the amount fixed for dower will be payable to wife without any regard to increase or decrease in the value of currency on the date of payment.
Dr. Hasanuzzaman refers to another aspect of indexation which is objectionable from the Shariah point of view. It is the element of ignorance and uncertainty found in indexation, An important condition of a contract of deferred payment is that the liability of the parties should be precisely determined at the time of making contract. Ignorance of this liability at the time of making contract makes the contract void. In indexation, the liability is known with determination and certitude only on the date it is due. In order to solve the problem of time lag between the period for which a change in the price level is observable and the period in which the price level adjustment is applied to the transaction, some countries have accommodated even projected inflation in the index While ex post indexation involves an element of ignorance (jahl), projected inflation involves the element of uncertainty (gharar) too. Both make a_ contract null and void.
While the principle of linking loans and debts to purchasing power cannot be justified on Shariah grounds, there may yet be some arguments to adduce for indexation on rational and logical plan. Dr. Hasanuzzaman examines these arguments on the following lines:
(1)??????? The phenomenon of worldwide inflation causing hazards in economic life of man was never experienced before. It is therefore, necessary to do Ijtihad and not to stick to the opinions of the early Fuqaha. The answer given by Dr. Hasanuzzaman to this argument is that the rule of Ijtihad is that Ijtihad is done only where textual argument, or Nass does not exist. Since this question has been decided by a Nass, there is no scope for a new ljtihad. Any Ijtihad contrary to Nass is invalid.
(2)??????? The Holy Prophet has said that no damage should be done nor any damage should be borne. According to the arguments, inflation is a damage to the purchasing power of money and the indexation is a redress against this damage. In order to answer this question Dr. Hasanuzzaman examines the applicability of the Islamic Law of indemnity in context of indexation. In this context the Shariah provides that a person responsible for inflicting a damage should indemnify the sufferer. In case trade unions are responsible for a cost‑push inflation how a bank can be justified in making the entrepreneur indemnify the fall !n value of its loaned money? Will it not be a double punishment to the entrepreneur through paying higher wages to the labour and higher cost of loan to the bank? Why a borrower should be made to pay for a fall in value of money that occurs due to demand‑pull inflation caused by receivers of foreign remittances or the recipients of high salaries and those charging fabulous profits. Dr. Zaman asks. In some countries indexation is limited to Government bonds. It means the Government indemnifies only the bond holders. The question ' would arise as to on whose expense bond holders are being indemnified. Public treasury is mostly financed by public taxes. In other words it is the entire society which is indemnifying the bond holder alone while everybody in the society is equally the sufferer.
(3)??????? It can be advocated that the Government being guardian of the interest of the people (wall al‑amr) may indemnify the people of their loss in the purchasing power of money whether it is responsible for it or not. In this respect the guiding principle is that a damage is to be redressed. Dr. Zaman answers this plea by saying that this rule is applied only when one is sure that a damage will not be replaced by a bigger damage or a similar damage. Another condition is that mild damage will be endured to get rid of a serious damage. The third condition is that an individual or limited damage may be tolerated to redress a uninvested or common damage. Contrary to it, according to observers, indexation is a mechanism which is very complicated to devise and operate and is a recipe for perpetuating the built‑in inflation. The question will arise if we would like to resort to a more complicated mechanism in place of a simple routine without expecting any check on inflation. There is no doubt that monetary expansion brought about by rising public expenditure through deficit financing is treated to be a policy that causes inflation even if no other factors responsible for this situation are combined. But the question will arise why the Government resorts to money expansion. The answer is that the Government does so for overall development of the community, the whole country and the posterity. Confining the Government expenditure to regular budget and neglecting the major development programmes involving huge expenditure can save the people from the hardships of inflation. But at what cost? In the present day world, at the cost of economic and political survival. This means protection from a minor damage at the cost of a serious damage to the community. Moreover. development programmes and defence preparations may be withdrawn in favour of the purchasing power of the present generation but this may be done only at the expense of the existence of freedom and of the economic prosperity of the posterity. Thus a limited damage would only be avoided by exposing the country to a greater and more general damage.
(4)??????? Another argument that may be adduced in support of indexation is that during inflation trade unions succeed in getting their wages increased. If such increase is permissible in the Shariah why and how indexation can be treated to be unjustifiable. On a deeper examination it turns out to be a fallacious analogy because in the Shariah return on service is governed by a different rule than loan. Any increase in return on service is increase in remuneration while increase in the amount of loan is interest. The former is permissible; the latter prohibited.
At this stage notice may be taken of the case of Aijaz Haroon v. Inam Durrani (PLD 1989 Karachi 304) wherein one of us MrJustice Wajihuddin Ahmed in the High Court had come to the conclusion that indexation could be adopted as a solution to protect the purchasing power of money. The judgment had taken note of the views of the earlier jurists about fulus. Particularly the views of Imam Abu Yousaf and the findings of Allama Ibn Abedin were also discussed by my learned brother. Since then more material has appeared on the subject and comprehensive arguments both from Shariah and economic points of view have been placed before us. We feel that the matter noted in the judgment requires further examination in view of the matters noted hereunder by the experts on the subject.
Our brother in the judgment has referred to Qur'anic Verse, a saying by Pious Ali (Allah be pleased with him) and has referred to a booklet written by a celebrated jurist of 13th Hijra century, generally known as Ibn Abidin Shami. The booklet discusses the liability of payment under situations of demonetization, debasement, fluctuation in value of the coin, monometallism and bimelallism and reproduces the opinions of earlier Ulema on the issue some of which we have already given in the foregoing pages.
In case a person purchases something for the currency which, before making payment, is changed would have either of two effects:
(1)??????? In case this money is not in circulation the contract would be voidable. The reason is that in a contract of sale both nature and amount goods and money should be specified undisputably. In the event of destruction of goods before it is delivered or of money before it is paid the contract of sale will become ineffective. Thus in the event of non circulation of the contracted unit of money the contract of sale would become voidable because money is destroyed.
(2)??????? In case this money is in circulation but is depreciated in value the contract will not be invalid because money is not destroyed. As a result the seller will have to accept the same money. According to Zahidi in case a person sells something for a specific amount of money in circulation but afterwards that money if demonetized the contract of sale will become invalid. Therefore the purchaser shall return the goods if it is intact. But in case the goods is consumed or is transformed into a different form he will return the like of it if the goods are fungible or if otherwise, the price of the goods in terms of current money equivalent to the value of money that prevailed on the day goods was delivered to him.
The above legal opinion is found in respect of trading. In case it is a contract of hire the contract would become invalid and the hirer will have to pay standard rent (ajr mithl). In case of loan or dower the liable party shall pay the like of the amount payable. The above opinion represents Imam Abu Hanifa's views. According to Abu Yusuf the liable party shall pay equivalent value in terms of other currency as circulating on the day of the contract. According to Muhammad he will be liable to pay the demonetized currency which was contracted upon. According to Al‑Ghizzi if a person borrows currently legal fulus which are later on demonetized he will be liable to pay the like of it but not their value.
According to Hidaya, sale for debased Dirhams which are later on demonetized and become out of currency, is void, according to Abu Hanifa. But according to Abu Yusuf the purchaser shall be liable to pay the value that prevailed on the day of sale whereas according to Muhammad he shall pay the equivalent of the value of debased money in terms of current money.
According to Sharh Tahavi the opinion that in case the fulus are not demonetized but they increase or decrease in their value the borrower will be liable to return the exact sum borrowed by him, enjoys ijma (consensus).
Presently (early thirteenth century) we have a multi currency system in which the different currencies are equivalent in value and acceptability. As a result the purchaser has the option to pay in any currency of his choice. Alongwith it official decrees sometime devalue one of these currencies. This is a situation in which the legal opinion is divided. It was ultimately decided that if the unit of currency was specified in the contract, it would be payable as such. In case the unit of currency was not specified then the purchaser would pay the equivalent value of currency that he would choose. This opinion is adopted with a view to protect the buyer and the seller from loss arising out of arbitrary discretion of either party in view of revaluation or devaluation of the currency.
The Decree, in making out the case for paying the purchasing power of the amount of loan, claims to have been guided by the Qur'anic verse 3:7 which is reproduced below: `He it is Who hath revealed unto thee the scripture wherein are clear revelations ‑ They are the substance of the book ‑ and others which are allegorical. But those in whose hearts is doubt, pursue, forsooth that which is allegorical seeking to cause dissension by seeking to explain it. None knoweth its explanation save Allah. And those who are of sound instruction say: We believe therein; the whole is from our Lord; but only men of understanding really heed'. (English rendering: Marmaduke Pickthall).
It is not clear in what way the above‑quoted verse leads to provide the argument in favour of the decree. It may be submitted that the verses 2:278‑79 deal directly with the subject and support the argument contained in the decree that "while a borrower or a purchaser cannot be forced to return anything more than the amount due, he may not, at the same time and by the same token, be permitted to pay anything less than that which he, in the first instance borrowed or agreed to pay". The verses read as under:
"O ye who believe! Observe your duty to Allah, and give up what remaineth (due to you) from interest, if ye are (in truth) believers. And if ye do not, then be warned of war from Allah and His messenger. And if ye repent, then ye have your principal (without interest) Wrong not and ye shall not be wronged. " (2:278‑79).
The emphasis placed in the judgment on protecting the interest of both parties and restraining them from doing injustice is admirable but, it is also to be kept in view that indexation of financial liabilities in itself is fraught with injustice. It will be found that the early thirteenth century; (A.H.) work is a good compilation of earlier opinions on discharge of financial liabilities under situations of demonetization, debasement, official devaluation of one monetary unit in relation to another unit circulating within a country, of counterfeit mercy and money not treated to be legal tender (fulus). The point to note is that the opinions of early fuqaha as quoted by Ibn Abidin provide argument against the concept of indexation. The spirit of all the opinions, though applied to entirely different monetary set‑up, disfavours the concept of indexation.
We at the end would like to impress upon Muslim economists to explore the ways of fighting inflation within the. sanctions provided by the Shariah. If Chile, for example, can succeed in devising a non‑monetarist formula for fighting inflation there is no reason why our economists should insist on a device that apart from violating the rules of the Shariah, has failed to cure the evils of inflation.
It may not be out of place here to cast a glance over the concept and functions of .the institution of banks. This is necessary because in the present day world the important process of production and consumption is vitally affected by the process of the supply of money which consists of the currency paper money and various forms of deposits and securities with the banks. The banks, therefore, occupy a significant position not only in the national economy of a country but also in its political life, as they influence the size and composition of almost all the economic variables. The modern economy being based on credit money, the role of banks has become that of the power house in a city or that of blood‑supplying heart in a human body. If the banks provide blood of money to the national economy the interest plays the role of liver which creates that blood. Thus, any position taken about interest will have to affect the role and functions of banks in general and commercial banks in particular. Today, a modern commercial bank also provides a host of ancillary services to the customers which include the provision of lockers and safe houses, advisory services on matters of investment, portfolios and other financial transaction, protection of the interest of minors by acting as trustee of their state and several other services. But the main function remains to accept the `deposits' from the public and lending money on interest to the businessmen and entrepreneurs mostly against collaterals and hypothecations. In most of the banking laws of different countries the term "banking" has been defined as accepting for purpose of lending or investment of deposits of money from the public, repayable on demand or otherwise, and withdrawable by cheque, draft, pay order or any other negotiable instrument.
There seems two extreme views about the Islamic position vis‑a‑vis banking operations and practices. A section of the people in our country is of the view that all banking operations and practices are opposed to the Shariah and are prohibited. They even think that service in a bank or any kind of cooperation with a bank is violative of the spirit of Islam and a good Muslim should totally abstain from having any direct or indirect relationship with a banking company. On the other hand, there is another view which holds that all banking operations are absolutely in conformity with the Shariah and the banks contribute to the promotion of the objectives of Islam. Both these views are far from truth and need to be reviewed. Before deciding whether a particular operation of a bank is or is not opposed to the teaching of Islam, the functions of a bank or banking institutions should be clearly identified. According to standard textbooks on' current banking, following are the main functions of a bank:
(1)??????? Receiving the Savings of the people as deposits;???????????
(2)??????? Advancing loans and finances on credit;
(3)??????? Opening Letters of Credit;???????
(4)??????? Issuance of Security Loans;
(5)??????? Issuance of negotiable instruments;
(6)??????? Discounting of securities and other negotiable instruments;
(7)??????? Provision of Safe Deposits for the security of valuables, important documents etc.;
(8)??????? Transfer of money;
(9)??????? Sale and Purchase of Foreign Exchange;
(10)????? Opening of Current Accounts;
(11) Issuance of Traveller Cheques;
(12)????? Sale of shares;
(13)????? Issuance of Dividends and Proceeds of Debenture;
(14)????? Issuance of National Currency (performed by the Central Bank of the country only).
It is neither possible nor required for the present discussion to discuss and pass any verdict on the permissibility or otherwise of all these functions from the stand point of Shariah. But it must be emphasized that these are extremely important functions and any disruption in the performance of any of these functions may land the country into serious difficulty and may even place national economy into jeopardy. However, some of these functions are being performed in such a way and through such. modalities which are violative of the Shariah and must be. adjusted to the dictates of the Shariah to remove their repugnance from the Law of Allah. The objective for which these functions are performed are not only allowed under the Shariah but also promote its objectives. Banks facilitate safe transfer of money from one place to another. In the present day context banks and banking institutions are the quickest, easiest and fastest mean of transfer of money from one corner of the globe to the other, which is, undoubtedly, a great facility available to the people. This objective is absolutely in conformity with the Shariah. The second objective is the facilitation of production and development of industry, agriculture and commerce through providing finance and investments. Almost all the major developmental, agricultural and industrial projects are financed by the banks which thus contribute to the development of the country and ameliorate the standard of life. There can be no objection from the perspective of the Shariah to that objective also. The third objective of the bank is to coordinate and streamline the use of available capital through appropriate allocation of resources to the enterprise and projects needed by the society. No objection can be raised to this objective as well.
The problem only arises when we go to the modalities adopted by the banks and the details of their operations. If the needs do not justify means then the lofty objectives of the banks cannot and should not be taken to justify the practices and modalities developed by the banks to realize their objectives. The most important of these practices which falls under the core of our discussion in the context of this judgment is the nature of deposits received by the banks and the nature of credit or loans advanced to the entrepreneurs and businessmen. Savings and deposits being the most important and the main source of capital coming to the bank, it is of utmost importance that Islamic position of these savings and deposits is determined. It is mainly for the purpose of security and safety that the overwhelming majority of savers place their savings in the banks. The ratio of those who put their deposits for the sake of any return is comparatively limited. Those who deposit their savings for the sake of return either put their money in schemes like Defence Saving Certificates, Khas Deposit Certificates or place them in term deposits. The majority of Savings‑Deposit holders in any case, are those who do not expect any return on their savings. The question which occupies a significant position in this discussion is whether bank deposits are really Amanat as these are claimed to be or they are Wadiah or and (loan) or investment in terms of Mudarabah and Musharkah as many people claim them to be. The identification of their nature is necessary because the Shariah has given different principles to regulate each of these kinds of deposits. Let us, therefore, keep in mind that bank deposits also fall under various categories which include (i) Current Accounts; (ii) Fixed Deposits; (iii) Savings Accounts; (iv) Special Accounts; (v) Term Deposits etc.
There are different rules to regulate these accounts but there are two important aspects which are common to all these kinds of deposits. Firstly, as soon as a sum of money comes to any of these deposits it become a property of the banks for all practical purposes. From that moment onwards the bank has exclusive control over that money and the account holder has nothing to do with that particular amount of money. The bank invests it, uses it and spends it according to its own decisions and policies. The account holders or the savers neither have any right to object to the use of that money nor they have any say in the formulation of the policies and the making of any decision by the bank. Secondly, the money deposited by the savers and the account holders is reasonably guaranteed and the bank is under an obligation to pay it back according to the conditions and rules applicable to particular kind of deposits to the savers irrespective of the loss, if any, or the volume of loss incurred by the bank. In case of any loss, it has to be incurred exclusively by the bank. However, the 'profit' is to be shared by the bank as well as by the depositor. This being the nature of bank deposits, when we examine them in the light of the Islamic principles, we come to the conclusion that these can neither be considered as Amanat nor Wadiah because in both the situations the role of the bank should not be more than that of a trustee and the depositee; it should have no right to use, invest or spend it. The principle of Amanat requires that Amin should only protect and keep it in safe custody and should have no authority to dispose of that money. Moreover, there is no question of any profit or increase on the _Amanat or the Wadiah. It cannot be considered to be a Qurd (loan) either because while a borrower is allowed to use, to invest or to spend the borrowed money, neither he is under an obligation to pay any increase over and above the borrowed money nor a creditor (in this case the account holder or the depositer) is allowed to receive any increase. Such increase is not only disallowed by the Qur'anic verse 279 of al‑Baqarah but is also hit by the well‑known dictum unanimously accepted by the companions of the Holy Prophet (s.a.a.w.) and the subsequent jurists that any additional benefit accruing to a loan is Riba. Thus, we are left only with the last option, namely, that bank accounts are investments within the meaning of Ra's al?Mal of a Mudarabah or Musharkah. If that be the case then banking operations will have to be in accordance with the principles that regulate the v Mudarabah, Musharkah and other Islamic modes of financing.
Now the position of Government Bonds, treasury bills and other securities and debentures which are put to sale or purchase in open market operations, may be taken. Government bonds and securities, in many cases, represent a debt, loan or a deferred payment. The Shariah has expressly prohibited the sale or purchase of a debt for another debt. Thus, the sale or purchase of a debt in lieu of a deferred payment will not be allowed under Shariah as it will be hit by the well‑known Hadith reported by many compilers of the Hadith in which the Holy Prophet, peace be upon him, has prohibited the sale of debt with debt or the sale of Al‑Kali bil‑Kali. This Hadith has been reported by Dar Qutni on the authority of Ibn Umar. According to Hakim, this Hadith is a sound one according to the standard set by Imam Muslim. Another version has been reported by Tabarani on the authority of Rafi Ibn Khadij which has also been declared to be sound by Hakim. This later version has also been reported by Hibban, Baihaqi, Tirmizi and Nasai. Hakim has also reported from earlier authorities the explanation of the term sale of Kali for Kali. According to this explanation it is the sale of deferred payment (Nasiah) for another deferred payment (Nasiah). Baihaqi has also reported on the authority of Imam Nafi, a disciple of Abdullah ibn Umar, saying that it is the sale of debt for debt. Imam Shawkani has recorded on the authority of Imam Ahmad ibn Hanbal that there is a complete unanimity among the Muslims that the sale of a debt for debt is not allowed. This view has been endorsed by Imam Abu Hanifa, Imam Malik, Imam Shafi'e, Imam Awzai and Imam Sufyan Thawri (see for details, Imam Shawkani, Nayl al‑Awtar, Beirut, 1973, Vol. V, pp. 254?255). In view of this discussion the open market operations involving the sale of debt for debt will not be allowed under Shariah. Either such deferred payments should be sold or purchased on the basis of cash payment or, if cash payment is not possible, it may be through other Shariah compatible modes, for example, only those instruments be sold which represent a tangible asset or those in a tangible property. Another possible Shariah compatible mode may be through the principal of Hawalah in which the responsibility of paying the debt is transferred from the debtor to some other person. Hawalah has been defined as the transfer of liability from the debtor to the one who volunteers to undertake the liability. There is a unanimity among the jurists of Islam that once the Hawalah is complete, i.e., once the liability is transferred the original debtor stands absolved of all responsibility and liability. The Hawalah institution gets legitimacy from the Hadith as well as from the consensus of the jurists. As soon as the concerned parties agree, the process of Hawalah is complete. It may be pointed out here that the Hawalah should not be confused with the contract of sale because according to the jurists the Hawalah is a peculiar kind of transaction and is different from the institution of sale not only in its basic elements but also in its implications.
It may be pointed out here that the sale of debt for cash or in lieu of urgent delivery of the corresponding commodity is allowed by Imam Malik and Imam Shafi'e to a party other than the original creditor. In view of this opinion, the discounting of bills or the sale and purchase of bonds and debentures will be restricted to the cash payment and to the parties different from the original creditors. With these considerations the open market operations may be restructured in the light of the law of Hawalah.
Another but most important function performed by the banks is the provision of loans extended by them to possible entrepreneurs and businessmen. These loans are to a very large extent, if not totally exclusively, advanced on the basis of interest whose payment along with the repayment of the principal is secured and guaranteed against a collateral; the interest is charged in accordance with the prevalent rate. This prevalent rate is charged keeping in view the Bank Rate, LIBOR as well as the time frame in which the repayment is to be made. Although there are different kinds of loans advanced under a variety of conditions, the above ingredient are common to all kinds of loans. These kinds or classes of loans are mostly to facilitate the operation rather than changing the nature of the deal. For example, the conditions required of individual borrowers are different from those imposed on companies big enterprises and the Governments. Moreover, the performance of the party also has a role in affecting the nature of contracts and other requirements. However, the basic nature of the loan and its ingredients are not changed. It is not, therefore, relevant for our purpose to go into the details of these conditions and classification of loans. Such loans are offered in the form of cash, opening of letters of credit, discounting of instruments etc. The interest charged on all these kinds of loans is to be paid by the borrower irrespective of the fate or the outcome or the duration of the loans and irrespective of the success or failure of enterprise for which the loan was advanced. Obviously, the interest or increase charged on these loans fall under the category of Riba and is prohibited. Some modern scholars, particularly Dr. Fazalur Rahman, Late Mr. Justice Qadeeruddin Ahmad, Maulana Muhammad Jafar Shah Phulwarwi and lately Dr. Muhammad Sayyid Tantavi have tried to distinguish bank interest from Riba on the grounds that the objectives of bank loans are different from the objectives of loans advanced during the pre‑Islamic period. We have examined this argument at length. The gist of the argument is that the Arabs were not aware of productive or commercial loans. They only knew consumption loans on which the increase was considered to be Riba and was prohibited. The second foundation of the argument is that the interest charged on production or commercial loans does riot constitute injustice referred to in the Qur'an in the context of Riha (Chapter‑II verses 278‑279). However, it is difficult to agree with both these premises as discussed in paras. above. Some scholars have tried to consider that this transaction was a simple contract of Mushrakah and tried to equate bank interest with the profit accruing from Musharakah. This equation turns out to be different when the basic principles of Musharakah are applied to a bank transaction. While, on the one hand, an investor in a Musharakah enjoys ownership title in the assets of the company and it is with reference to those assets that he is entitled to receive his share in the profit. Secondly, the capital as well as the assets of the Musharakah are considered to be a. trust in the control of the managing partners/entrepreneur and in case of any genuine loss or any damage by an act of God it is to be shared proportionately by all the investors. Thirdly, and the most importantly, the ratio of profit is to be determined with reference to the success or failure of the enterprise. It has nothing to do with the time or duration of the loan. While, on the other hand, the interest is charged without any reference to the failure or success of the enterprise and is always determined with reference to the time and duration of the loan. In the light of these glaring dissimilarities between the two, the bank interest cannot be equated with profit accruing to a Musharakah.
Some contemporary scholars tend ,to consider this transaction to be a sale and treat the increase as equivalent to the profit accruing to the buyer in an agreement of sale. Although this contention is obviously faulty on the face of it to be discussed, yet it may be noted that it does not meet any ingredient of contract of sale. Firstly, there is no commodity on either side and it is a `sale' of cash for cash. As such it is subject to the laws applicable to Sarf contract where exchange of gold, silver, coins or cash takes place. According to the clear and express instructions of the Sunnah the delivery of both the price/commodities should be equal for equal and hand to hand. The Ahadith dealing with the Riba al‑Fadl are primarily to foreclose the door for this very kind of transaction. Even if it is accepted for the sake of argument that it is a kind of sale, it will be prohibited under the Shariah, as it involves both kinds of Riba, namely Riba al‑Nasiah in view of the deferred payment on the part of the borrower, and Riba al‑Fadl on the part of buyer because of the increase over and above the amount payable.
The true and legal position of bank loans under Islamic Shariah is that they are contracts of loans (Qard) because all the basic elements of and are found in these contracts. It has been held to be a and (loan) not only by almost all the contemporary Islamic scholars but also by the up? holders and expert of this system? even in the Western World. ,The repayment is guaranteed like a Qard, it is supported by a mortgage or a collateral like a Qard, the authority of the taker is to use, spend, invest or dispose it of is unlimited like a Qard the lender has no concern with the purpose or the objectives for which it is taken. Finally, the success or failure .of the enterprise of the purpose for which the loan was taken is absolutely irrelevant in both the cases. In view of all these obvious and significant facts it is not correct to claim that the lending transaction, undertaken by the banks are in the nature of trust, deposit, Musharakah or sale. It is in the nature of loan (Qard) pure and simple and has to be subjected to the restrictions placed by the Shariah on lending and borrowing of money and other fungible items. The most important of these principles is that the loan is to be returned exactly in the same quantity in which it was taken. Any increase over and above the amount borrowed is Riba irrespective of the pretext on which the increase is claimed. This principle is clearly embodied in the Qu'ranic verses of Surah al‑Baqarah (verse 279). It was understood by the Companions, the Followers and the later Jurists to be cardinal principle governing a loan. There is unanimity of views among all the jurists of Islam that any benefit accruing out of loan is Riba. This unanimity of views found expression in the well‑known dictum. This dictum has been reported by many compilers of Hadith on the authority of several Companions. It has been reported by Abdullah Ibn Saud, Ubayy Ibn Ka'b, Abdullah Ibn Salam and Abdullah Ibn Abbas on the authority of Hazrat Ali by Syyuti, Fadalah Ibn Ubaid Bayhaqi. Some scholars have attributed this to the Holy Prophet (s.a.a.w.) through some weak chain of narrators. It is, therefore, beyond any shadow of doubt that this is an accepted principle among the Companions and it is they who have phrased this dictum into this wording.
Now we proceed to examine the position of Letters of Credit of Banks. The purpose or the objective of the opening of letters of credit is not something objectionable. On the other hand; it is a facility extended by the banks to the traders and the businessmen. The purpose of opening letters of credit is to facilitate quick and easy payment and the transfer of money from one place to another. This facility, being a lawful service, has to be properly compensated in terms of Shariah. If the payment of compensation or remuneration is linked with the volume of service, the Shariah has no objection. In this case it will be a kind of service charge which has been already considered and approved by almost all the contemporary scholars and learned bodies. In this case it will be necessary that the rate of service charge is determined keeping in view the magnitude of the service, quickness of the payment and the level of credibility and performance of the bank concerned. Since it is related with the time or duration of payment and is collected in terms of percentage of the amount paid, it becomes Riba. There is no objection if the banks require collateral or hypothecation of certain assets or securities to ensure timely, repayment, provided the guarantor does not charge any interest and the mortgage is controlled by the law of Rahn. The payment made by the bank to an importer or a purchaser under a letter of credit is again in the nature of Qard because it does not fall in any other legitimate category of transaction. As such it 'is to be regulated under the law of Riba. It seems worthwhile if the State Bank of Pakistan determines certain fixed rates of service charge to be paid by the importer/purchaser to the: bank as a compensation to the service rendered by the bank. There may be different‑ rates for different kind of transactions provided these rates do not change with any delay in the payment and are not calculated on the basis of the amount of money involved. There may be flat rates for various kinds of transactions whenever letters of credit are need to be opened.
The discounting of negotiable instruments is not only an important function of modern banks but also, constitutes a sizeable source of their income. The discounting of instrument by the State Bank of Pakistan is a big source for the revenue of the Government. One of the experts appearing before us estimated the proceeds of the Government from discounting to reach up to 19% of the total State revenue. However, irrespective of the magnitude of the income .the question of discounting is to be tackled in the light of the Shariah. There has been difference of opinion as to the real nature of this transaction in terms of Islamic law. The question whether the practice is permissible under Shariah and, if so, up to what extent and under what conditions depends on determining the question where the discounting is Hawalah (transfer of debt), or sale of a title or a loan taken from the bank. As we have seen, it cannot be taken to be a sale because it is the sale A of debt for higher price which is not allowed. Moreover, the deferred payment is involved in the sale of money for money. It may, however, be construed to be a loan and has to be regulated as a loan. The increase ultimately earned by the bank through this operation would fall under the category of Riba. Some scholars have tried to justify this practice on the basis of a precedent attributed to the Prophet (s.a.a.w.) in a similar case. We have dealt with that precedent elsewhere.
The rest of the activities undertaken by the banks are allowed under the Shariah on payment of such fee, remuneration or service charge as may be fixed by the State Bank or may be determined by the concerned bank under the general guidelines issued by the State Bank. However,' it will be necessary that the amount of fee, remuneration or the service charge is not related to the duration or the time frame of any payment or repayment involved and that it is calculated exclusively on the basis of the volume of labour involved and the nature of service rendered.
The banking operations having been analysed in the perspective of Injunctions of Islam, the need to restructure and redesign banking operations by amending the related laws and affording new approach and dedication to the objectives of Shariah is apparent. This brings to focus the development of alternative modes conforming the requirements of Shariah. The question of developing a viable alternative to the present interest‑based operations has engaged the attention of a large body of scholars. There has been no C difference of opinion, even among those who considered bank interest to be permissible, that the modern banking operations require remodelling and restructuring if interest is to be abolished. To have a cease‑fire with Allah and His Messenger (s.a.a.w.) has always motivated Muslim minds to come out with a Riba‑free model.
There is a general consensus that the abolition of interest will require some restructuring 'of the banking practices and patterns. It is generally felt that the banks should work as investment banks and, wherever necessary, as holding companies. If the banks reorganize themselves as holding companies, they may, perhaps, easily undertake what was known in, the United States as group banking. It is said that group banking, has some merits if it works under a holding company. Under the group banking a corporation, a business trust or a professional association controls two or more commercial banks. The experiment of holding companies controlling commercial banks has been successful in the United States. The main feature of the group banking system is the centralized management and a uniform command and control system leading to economizing the expenditure and maintenance of larger cash reserves. Moreover, the resources of all the member banks can be pooled to finance large enterprises and business concerns. However, if group banking system is adopted it will require strict legal measures to ensure effective control and supervision, larger and more effective coordination and to avoid the furtherance of personal or group interests of those controlling the holding company.
It should not be difficult to restructure our present banking system into a mixed banking system, which our banks are already to some extent, to perform the dual work of commercial banks making both long‑term and short‑term financing to the industries, commerce and agriculture but also to serve holding companies establishing their own commercial enterprises, industrial concerns and agricultural projects. Their role should not, therefore, be confined to the supplying of money for short‑term requirement of trade and commerce. Traditionally, the commercial banks have been refraining from supplying long‑term credit to industries. This trend has been prevalent in Britain from where it influenced our bankers. On the other hand, in some countries of Central Europe, particularly in Germany, the commercial banks have reportedly contributed in a substantial way to the industrial development by providing. long‑term finances to industries. The experience of this mixed banking system is that they have quite successfully promoted the industrialization of their respective countries and have also provided initial capital to the newly started industries. It may be pointed out here that the factors which had led to the development of mixed banking in Germany are also found in our country. It was the scarcity of capital, the reluctance of the foreign investors and the absence of suitable entrepreneurs and such other reasons which led the commercial banks in Germany to develop the concept of mixed banking and to closely collaborate with the local needs in the interest of country's rapid industrial development. The shortage of capital was mostly because of the downfall in the savings which was, in turn, due to the absence of mobilization and motivation. This situation was remedied by the mixed banking system which provided capital to industries not only by providing long‑term finances but also by floating debentures of joint stock companies. This made the banks active partners in the economic development of the country and promoted big industrial projects. Some banks provide help to German industries by underwriting their equity and debenture issues and also by granting them advances in anticipation of such issues in future. Expert financial advice and consultancy was also provided by the banks to big industrial projects about the issues related to the investment market. In some cases where large amounts of liquidity were available with the banks they invested them in long‑term industries credit and earned high dividends. The role of the State Bank of Pakistan would become pivotal in controlling and streamlining the process of funding and financing short‑term and long‑term projects. It has to be ensured that capital resources are not blocked in such long‑term finances which do not yield sufficient dividend or in sick industries under political pressure which is, unfortunately, riot uncommon in our country. If such situations are not avoided the loss in major industrial concerns is bound to affect the performance of the banks.
An important function performed by the State Bank in relation to commercial banks is the authority to control credit and thereby to regulate the working of the banks and flow of capital. The main purpose of credit control is to ensure the stabilization of exchange rate and to maintain the stability of the national currency in relation to foreign exchange. In the past when the currency was on the gold standard there was little fluctuation in the value of the currency and it was easy to retain the fluctuation with the narrowest possible limits. But with the abolition of gold standard the fluctuation in exchange rates has become a major problem which has to be dealt with at the central level by the State Bank. Different techniques are adopted in different countries to control the credit and the flow of capital. These techniques and policies are considered to be unavoidable in the modern complex economic organization. Generally, it is the interest rate and the safety regulations or prudential directions of the State Bank which are considered to be effective tools used by the State Bank to exercise influence to control bank credit and money supply. There are a number of instruments used by the State Bank to control the credit and the bank rate or the interest rate. The most important of these, which have a direct relevance to the abolition of interest include open market operation, rationing the credit, minimum statutory cash reserve ratio, regulations to control consumers credit and margin requirements. Of these, two need fuller discussion, namely, the bank rate and the open market operations.
Open market operations have now become the most important instrument of credit control. Previously, it was bank rate which was considered to be the primary tool of exercising control over the credit flow. It seems that the role of bank rate in controlling the credit and streamlining the flow of liquidity in the money market will continue to be marginalized in future and the role of open market operations will continue to expand in various directions and different dimensions. This is because of the fact that the world is moving towards a direction which may ultimately lead to either total abolition of interest or to reduce it to a minimum rate. This tendency is visible in some leading economies of the modern world wherein the interest rate is continuously on the decrease. It is now mostly through the open market operations that the State Bank exercises its control. It withdraws funds from the market primarily either by borrowings from the market or by selling its securities, assets and documents. The bank sells consolidated Government's stocks for cash and repurchases them on a deferred payment till the date fixed for the monthly settlement of the stock exchange. In this manner it withdraws cash from the market temporarily for the unexpired period of monthly account. Borrowing of the bank include borrowing from discount houses and bill‑brokers against the pledge or mortgage of Government securities, this also helps reducing the available volume of funds in the market and thus the market rate stands controlled to the extent of banks operations. The increased popularity and the rising importance of the open market operations is indicative of the fact that the policy of bank rate or discount rate has not been successful in controlling the credit and streamlining the cash flow in the market. The sale or purchase of securities and other instruments available in the market by the State Bank is not objectionable in itself from the Islamic point of view. Rather, it is something which contributes to the proper and balanced functioning of the money market in the country. As long as these operations are done keeping in view the independent interplay of market forces and avoiding involvement in Riba; positively or negatively, these operations are allowed subject to observations made above.
Moreover Council of Islamic Ideology has warned time and again that interest‑free banking cannot be successfully operative unless a total change does not take place in the society. There is no denying the fact that elimination of interest is only a part of the overall socio‑economic system of Islam and, to quote from the report of the Council of Islamic Ideology, this major change alone cannot transform the entire system in accordance with the Islamic vision, as simultaneously with the introduction of interest (free Banking System strenuous efforts shall have to be made on a wide front to inculcate in the society, basic virtues such as fear of Allah, honesty, trustworthiness, sense of duty and patriotism. There are wide range of steps to be taken by all concerned for the realization of this objective, namely, the establishment of socio‑economic ideal of Islam. These steps shall have to be taken jointly by the individuals, the business community, the banks, the industrialists, the tax collectors and the Government in power. Unless the entire machinery and the Government and the entire business life is geared with full dedication in this direction, the curse of Riba cannot be eliminated. The challenge is undoubtedly colossal and the task is tremendous and it requires a serious and dedicated efforts.
At this stage, we propose to discuss the apprehension expressed and the objections raised by western capitalists to the effect that an interest‑free economic system would face difficulties and is bound to meet failure, The most important objection raised is that mobilization of resources will be possible with the elimination of Riba to generate resources at an optimum level. The basis of the apprehension is the belief that capital is a factor of production in itself. Therefore, it must have a price and should perform the functions of a price, namely, it should control and regulate the allocation of loanable funds to different users keeping in view the ability of the respective user or users to pay the price. This argument presupposes that the loanable funds are scarce and the number of users is unlimited and the relationship between them should be regulated by law of demand and supply and that the interest rate should be adjusted as a result of operations of these forces. Those who advance this argument presume that the loanable funds will be available to the users totally free in the absence of interest and that this free availability of loans would encourage unlimited number of borrowers to make their demand for funds and that in the absence of any available mechanism for balancing the demand and supply, the situation will lead to a chaos. They also presume that the interest‑based system has been proved to be a faultless and just mechanism to allocate the resources optimally, an assumption whose fakeness and baselessness is too obvious to need any arguments. The upholders of this point of view either forget or do not take into consideration that the legitimate profit calculated on the basis of the actual success and productivity of an enterprise actually performs function of allocation of resources successfully, efficiently and justly. The assumption that funds will be available free is also based on non‑recognition of the role and functions the genuine profit will perform in the national economy. In an interest‑free system the allocation of funds shall be regulated by the share in the profit which will, for practical purposes, be the 'cost' of funds. It means that rate of profit and the viability of the project will be the deciding factor not only for the allocation of resources but also for performing of functions of balancing between demand and supply. The enterprise and the users showing greater dividend or anticipating greater rate of profit will receive larger funds. It will be the actual combination of the market and the performance in terms of profit and dividend that will decide the fate of a business and its entitlement to receive further funds. The banks and the financiers will ensure that their funds are invested in such enterprises and business whose success has highest expectancy. No financier will be ready to invest in a project without careful evaluation and due vigilance. The door of getting money in the name of inefficient and unproductive projects will be closed, This is because a lender in an interest‑based system does not share any risk in the business he finances. The entire risk is shifted to the entrepreneur while the finance is guaranteed not only the safe return of the principal amount but also a pre‑determined rate of interest. In the present system the financier has no concern about the legitimate outcome and fate of the business. When a financier in an Islamic framework would know that not only his principal amount is at risk but also his profit is dependent on the success of the enterprise he is bound to undertake as thorough an evaluation as possible. For this purpose either the banks and non‑banking financial institutions may themselves create expert advisory cells or may establish consultancy consortium to get such requests and feasibility reports examined. As soon as the system starts working and takes of, consultancy firms will come into existence to help the financier examine and decide the viability of an enterprise or a business.
The assumption that interest has served as an effective and efficient mechanism for the allocation of resources is a weak assumption. Without going into experience of other countries, even a cursory glance over the history of the performance of our own banks is sufficient to steal away the carpet from beneath this argument. Almost all the experts who appeared before us have produced detailed evidence supported with facts and figures to show that present system has failed to ensure a just and equitable distribution of resources which may be considered to be equitable and just at any standard.
In the book Towards A Just Monetary System, Dr. Muhammad Umar Chapra quoted the views of western experts who have found compelling evidence to conclude that in the United States the existing capital stock is misallocated ‑ probably seriously ‑ among sectors of the economy and types of capital. Such allocation of resources can take place only in a dream world of perfectly competitive equilibrium models the market economies have theoretically formalized. On the authority of another leading western expert Dr. Chapra establishes inadequancy of the capitalist models for proper allocation of resources. He quotes yet another western authority who says that the money rate of interest does not rule the roost and feels that the rate of interest is irrevocable to investment decision and should be replaced by the price of existing equipment (or share price).
Other scholars have also thrown light on the question of the so?-called equilibrium in the rate of interest which is only something theoretical and bookish. Such a rate does not exist in the actual market. Moreover, the determination of the equilibrium rate is such a complicated and complex exercise that it is very difficult to effectively observe it, if any body wants to. The real deciding factor in the market is neither equilibrium nor equity It is, rather, creditworthiness of a borrower which is the main consideration for the release of credit. This is so obvious in favour of the rich and against the poor that hardly needs any explanation. The richer the person more creditworthy he would be. The more creditworthy a borrower the lower the rate of interest. The lower the rate of interest, the greater the borrower is beneficiary. That is why the biggest businessmen in the country always manage to get larger chunks of funds at lower prices because of their highest creditworthiness. This results in a situation where the richest borrower has the less burden and the poorest, if ever allowed in the club of privilege of borrower, bears the highest burden. This makes the whole business atmosphere extremely and increasingly unfriendly to a small and even medium businessmen and the country is deprived of their contribution an profitability which may be more as compared to the so‑called creditworth; entrepreneur. In this entire game, honesty and integrity of a person, viability of a project, feasibility of a scheme, needs of the country, requirements of justice, all are relegated to the background and carry no weight in the scale of creditworthiness. The financier is always prone to release his funds to secure rather than productive hands. According to Dr. Muhammad Anas Zarqa, this state of affair is the logical outcome of an interest‑based financing, only because it does not share the risk of the business. Thus he naturally feels inclined to lend his money to the richer in order to ensure that the payment of the principal amount along with the interest without incurring any risk. But if he is made to share the risk he would be more concerned about the viability and profitability of the business, in which case the borrower will be on the same footings as rich to try a chance. Now, it has been widely acknowledged by the western experts that the interest‑based system ensures greater flow of credit to the rich.
The upshot of the discussion is that the interest‑based credit system is by nature and definition a handicap in the establishment of the distributive justice initiated by Islam. It has failed to give any objective criterion for credit rating. Its criterion is totally biased in favour of the tiny rich minority of the society. Even in the leading economies of the western world, system has provided constant impetus to big businesses which have grown bigger and bigger; but in return, have created invincible monopolies which control both the borrower and the money in the country. The whole economic and political life becomes a hostage in the hands of the few. The entire nation finds itself at the mercy of the few who dictate their policies for their own benefits and to the determinant of the common man. Small businessmen constituting the overwhelming majority of country's business life never get anything from the lenders, both from banks and non‑banks financial institutions. Even if some small businessmen manage to get loans they are constantly looked with suspicions and indignation on any sign of trouble and difficulty, loans given to them are recalled adding to and accelerating their problems. On the other hand, big businessmen are allowed default after default under the honourable title of rescheduling.
Moreover, in an Islamic system the share of the financier is always linked with the profit and success of the entrepreneur. The higher the success and profit the greater the share of the financier and vice versa. Thus, contrary to the interest‑based capitalist system, if the profit of a business is bigger it should pay higher return both to the financiers as well as the entrepreneur. According to the teaching, policy and spirit of Islam, the resources allocated should not only be more effectively utilized but also be equitably distributed. ???
Another objection that savings and capital formation in the private sector will come down in an interest‑free economy and the erosion of purchasing borrower of money as a result of inflation will further reduce the savings. This objection is based on the traditional western concept that interest motivates savings and the abolition of interest is bound ‑to reduce savings. On a closer examination this objection seems to be baseless, if not, totally ill‑founded. There is abundant empirical evidence collected both by western and Muslim scholars that there is no relationship between savings and interest. If we take the example of our own country we find that almost 80% of the savings in our banks have been deposited by lower middle class who do not put their money in the banks for sake of any return but for security. Even those who want to invest their money in return‑yielding sources do not deposit them in commercial banks. They rather deposit them in such investment schemes which offer greater returns such as Defence Savings Scheme etc. The large scale investment in finance companies established in mid 80's in Karachi and Lahore is inductive of the fact that banks are not the proper place for yielding the profits, at least in the perception of the overwhelming number of savers. A number of western scholars have discussed the relationship between interest and savings and have come to the conclusion that the impact of the interest rates on savings is extremely negligible. However, it does not mean that in Islam savers, small or big, should not expect any return on their savings. .If the savers find the required friendly atmosphere in small business they will invest in small businesses and will look for more and more profitable finance for investment of their savings to offset the erosive effect of inflation and meet any future uncertainty and the need of a rainy day in future.
Another objection often raised in pathetic term is the future of such savers who are not in a position to organize businesses for themselves or to participate in any active business enterprise or commercial activity. Retired Government servants, widows and orphans and the disabled who have no option except to invest money as sleeping partners must have to receive regular income by investment in some profit‑yielding enterprises. Undoubtedly, such sleeping partners should have avenues for investment, and participation in any partnership or equity. It is also necessary that the savings available with such people should be as less risky as possible. We shall discuss the possible options later. The scope for sleeping investors is wide enough under Shariah to accommodate their special needs keeping in view their special situation. There are modes of investment with varying degrees of risk, maturity and amount of finance involved which may be of use for such investors. Once the interest is abolished and Islamic economy sets in motion there will be a host of instruments of various modalities to satisfy the needs of different investors in terms of level of risk arid the amount and scope of liquidity. Moreover, the concern expressed by the up?holders of the problems of the old, the widows and the orphans is based on the presumption that Islamic State does not have any responsibility for this section of the society. They are not left at the mercy of their own fate in any Islamic framework. The State is under an obligation to create a fund in the Baitul Mal, far or less on the patron of Benevolent Fund, where the contribution of these people of the society are invested along with contribution of the public exchequer which may be bigger or smaller or equal according to the resources of the country. This fund which will keep on increasing with the passage of time will be an amount of trust, the proceeds of which will be regularly paid to those who can invest and also to those who cannot, of course, with varying degrees keeping in view the amount and the resources available. But one should not forget that the attitude of the Baitul Mal is not to create a class of parasites who sit ideally at home only to receive monthly pension or stipend from the public exchequer. Such facility is available only to those who are not in a position to earn because of their physical or other incapacity. For such people the Baitul Mal should have exclusive fund from Zakat and other contributions both from the Government as well as the public which should be invested exclusively to meet the needs. The Zakat fund may also be separately invested in suitable enterprises which may become the sole property of such deserving people. The Islamic emphasis on partnership and equity will generate funds and encourage people to save for investment in their own business. The experience of smaller businessmen in our market is indicative of the success of this fund. There are hundreds of thousands of investors and, self‑employers who save for the investment for their own businesses are operating in an informal and non‑corporate business. In fact, a large chunk of informal business in the country is already, by and large, interest‑free. The rapid success of small traders and business in our market is indicative of the fact that it is not interest but elimination of interest which provides real impetus to economic success. Another objection, rather apprehension is that the abolition of interest will lead to an instability in the system that the equity‑based market will not be able to bring stability in the system. This apprehension is not based on any empirical study. Rather, it is the interest which has been one of the important destabilizing factors in the capitalist economies.
Now we propose to deal with borrowing by the Government and the effect of the borrowing on economy of the country and steps needed to be taken for interest‑free economy. The note submitted by Mr.Muhammad Ashraf Janjua, Chief Economic Adviser, State Bank of Pakistan shows that the Government of Pakistan is the biggest borrower as it is continuously borrowing to finance its fiscal deficit. As of 5th May, 1999 its total domestic borrowing stood at Rs.1258 billion from the following
sources:???????????????????????
???????????????????????????????????????????????????????????
(Rs. Billion)?????
??????????? (i) State Bank of Pakistan???????? Rs. 333.8 billion
??????????? (ii) Commercial banks?????????????? Rs. 297.0 billion
??????????? (iii) Non‑Bank borrowing????????? Rs: 627.2 billion
????????????????????????????????????????????????????????? ______________
(Saving schemes)` ":
Total ?? Rs. 1258 billion
In addition, Government's foreign debt as of 31st March, 1999 stood at $ 31.15 billion or Rs. 1610 billion at the current inter‑bank rate. Together, the national debt at Rs.2868 billion amounts to nearly 95 % of the GDP. All this debt is based on fixed interest rates.
Government borrowing from the commercial banks at Rs.297 billion constitutes nearly one‑third of banks total lending and investment. It is asserted in the note that rates of return on these lendings have implications for the banks' policies including forecasting of their balance sheets. The conversion of this stock of debt will have implications for the profitability of banks and hence for both the depositors and borrowers. The same position prevails as regards the Government borrowing from the State Bank which stands at Rs.333 billion. Next comes the Non‑Bank Borrowing through various national savings schemes which stand at Rs.627.2 billion which is half of the total public domestic debt. Thus the savings are owned by people of different walks of life such as pensioners, old people, widows and others, who exclusively depend on reasonable return on their savings. The point of view advanced in this note is that all this data is based on interest rates and? till such time that the Government fiscal deficit is totally eliminated either through improvement in its resource mobilization or containing its expenditure and investment to the absolute minimum, the Government borrowing from the above sources would be inevitable and if the Government's need to borrow continues, this would require the evolving of interest‑free, equity‑based or similar instruments which in turn involve research and analysis and some period of experimentation. It is added that both the developing of such instruments and then gradual introduction will be time consuming exercise. It is urged that keeping in view the size and complexities associated with this management both the conversion of this debt into interest free instruments that do not disrupt the operations of financial system or its retirement will take a long time. The note does not spell out this "long time" statedly noted for adopting interest‑free economy system. The major issues in the fiscal policy in shifting to interest‑free operations have been summarized as under:‑‑‑
(i)???????? To retire and/or convert and restructure the stock of public debt in a manner that the new arrangements are acceptable to the savers, investors and other economic agents without major economic disruptions.
(ii)??????? To reduce and eventually eliminate the Government borrowing in future.
The problems which are likely to be faced in converting the interest‑based system to interest‑free operations have been detailed as under:‑‑‑
"The conversion to interest‑free economy needs a great deal of in ?depth research and analysis, an appraisal of experience of countries where similar experiments have been made and finally developing of instruments, representing real assets, which can replace the existing instruments, can be handled efficiently and are acceptable to savers, investors and other concerned economic agents. This will also involve a broad‑based training programme for bank staff, familiarity with terminology, changes in documentation, new methods of accounting and a whole series of other changes including the attitude of users of credit. One major constraint will be the uncertainty both about the principal and the rates of return which can be overcome over time when economic agents can base their expectations on changes in developments that determine profitability etc. Banks and other financial institutions which are traditionally used to investing in fixed rate papers would have to operate within this constraint. As yet, there is no precedent of a central bank managing an efficient monetary policy through interest‑free instruments. The experiments made so far show only partial success in this area."
As regards operations of the commercial banks dealing with private sector both for working capital and for investment, it is urged that the difficulties arise mostly on the assets side of banks as it requires the development and introduction of efficient and compatible with Shariah modes of financing. It is urged that to provide credit to private sector on interest‑free basis, without adequate home work in research and analysis, is likely to generate many problems including uncertainty, the need for monitoring, transparency and detailed documentation. Experience has shown that established investors/entrepreneurs are generally reluctant to share profits with management of bank or even equity holders. In fact in some countries where Musharaka (or partnership) has been tried, the problem has been that of different perceptions on the part of bank and the borrower about profitability, costs and accountability. According to Mr.Ashraf Janjua, "additional problems and difficulties that the commercial banks are likely to face include tax system that encourages lavish expenditure by the corporate sector and makes it reluctant to make full disclosure of its financial affairs, lack of awareness among public about the new system, lack of expertise and even commitment among the bankers to successfully manage financing under Islamic modes, apprehension of the business and industrial community that if they enter into Musharaka agreement with banks for financing, there may be undue interference by the banks in their management, their perception that Islamic system of Musharaka is full of complexities, and lack of speedy disposal of the default cases and disputes. If banks are advised to engage in purchasing/selling of commodities and to create inventories for the purpose of genuine Murabaha it will not only encourage corruption among the banks incumbents, but also adversely affect their intermediation function. Murabaha, because of being simple transaction is very popular whenever Islamic modes of financing have been tried. However, it requires actual purchase and sale of commodities with the. purchaser assuming the risk before selling it on credit to the buyer. Also, because of its popularity, banks have turned into trading houses."
The note of Mr.Ashraf Janjua also describes the problems relating to external sector as follows:‑‑‑
"Pakistan has a large foreign sector comprising exports, imports, receipts and payments of invisible, home remittances, inflow of resources including borrowing by the Government and servicing of country's external debt. Even for a reasonable rate of economic growth Pakistan is dependent on inflow of resources particularly from international financial institutions. These institutions being of international character have their own policies. As a beneficiary of the resources of these institutions, Pakistan has to observe a measure of discipline and meet a number of commitments. Among other things, liberalization of economy, market‑orientation of management, removal of distortions and frictions, competitiveness in the financial sector and similar other conditions are invariably a part of commitments. Also, Pakistan has been borrowing from the international market and from banks in the private sector. Except for foreign investment other inflows involve not only conditionalities and discipline may be at variance with the requirements of a system working under interest‑free arrangements. Resolving of these conflicts will take its own time.
Because of its overriding importance, Pakistan's external debt deserves a special mention. As of end‑March, 1999 Pakistan's external debt stood at $ 31.5 billion. In the past five years the stock of debt has increased at an average annual rate of $ 1.33 billion.. This is in addition to foreign investment, foreign currency accounts and some other liabilities. Like domestic debt the problem of both the stock of foreign debt, or even a significant part of it, looks unlikely in the foreseeable future. The only options are to renegotiate the debt, if possible, and contain the further expansion of stock through improvement in balance of payments. It is also necessary to encourage the non‑debt creating inflows like Foreign Direct Investment (FDI) and home remittances. This requires, besides the creditworthiness of the country, a competitive environment. which responds to price signals and a robust private sector. Lately, both the foreign investment and home remittances have shown a declining trends for a number of reasons. Renegotiations in terms of conversion of foreign debt into equity based and other modes acceptable in Shariah is not a promising option either. At best, we can devote greater efforts to removing misgivings, entailing any changes in the financial system which, in all likelihood, will be interpreted as having religious motivation."
The conclusions drawn in the note may now be reproduced:‑‑‑
"There is a general agreement that the interest‑based financial sector and economic management in Pakistan should be shifted to Riba‑free modes of operations. However, the features of the operation of financial sector as detailed above i.e. a large Government debt held by various segments of the economy, monetary and credit policy anchored to the market mechanism, age ?old working of financial sector particularly the banks, on interest ?based instruments and transactions, savings and investment in the economy and the size, the attitude and expectations of private sector indicate that shifting to interest‑free arrangements of all these operations will involve a fairly long transitional period. A great deal of research work, institutional changes and broad‑based reforms will be necessary. It will have to be a gradual process and will involve development of new instruments of monetary and fiscal policies, improvement in the documentation of the economy, transparency of operations, amendment in laws, research and analysis, education and training, change in the attitude and values of people and, above all, a strong and flourishing private sector in a competitive environment which offers investment opportunities and responds to price signals which would require removal of distortions and frictions in the markets. Any intervention in the financial sector without first addressing the abovementioned problems could cause serious disruptions in the economic management with adverse impact on growth and cost‑price relationships.
The requisite changes and improvements mentioned above would need to be watched, coordinated and monitored by a high powered Board consisting of Shariah scholars who are familiar with economic and economists and bankers with some understanding of Shariah as well as experts in other relevant fields. Doing a thorough job may require the hiring of the services of international experts and scholars. Such a Board should ponder over how the concerned institutions can be reoriented and new instruments developed. It should also overview the entire process of transition from the present interest‑based system to interest‑free modes of economic and financial management.
It is pertinent to point out in this connection that during the past two decades a number of Islamic countries including Pakistan, Iran and Sudan have tried to introduce comprehensive Islamic financial system. However, there has not emerged any example of a really Islamic system of finance and banking that could serve as a standard of reference and lend guiding principles for a comprehensive move towards elimination of Riba, in letter and spirit. There exists a number of differences in perception regarding interpretation of Riba and the minimum acceptable standards of various modes of financing. The scholars in Iran permit the system of giving gifts as return on loans, sale and purchase of debt with discount or premium and discounting of bills, and the return paid on intra‑Government loans. Scholars in Pakistan and the Middle East are not inclined to accept this view‑point. A consensus can be of great help in achieving the real objective. Reliance of banks in all such countries, and even in the case of individual banks, on short‑term financing on the basis of lending‑based modes likes cost ?plus sale or leasing is due to a number of serious impediments and difficulties. The most important areas that needs to, be addressed are research for development of the requisite equity‑based monetary policy and regulatory instruments, ensuring transparency and all pervasive accountability, restructuring the corporate sector, tax system and the legal framework, creating conducive environment and enhancing the expertise of banks' incumbents at‑all levels."
Though the note concedes that there is a general agreement that interest‑based financial sector and economic management in Pakistan should be shifted to Riba‑free modes of operations yet nothing has been said as to the steps taken by the State Bank of Pakistan which is the Central Bank of the nation and which monitors the monetary and fiscal operations as to the steps it has taken despite the aforenoted general agreement and the consensus and the judgment of the Federal Shariat Court pronounced in the year 1991. Even in the note the Court has not been taken into confidence as to the estimate of time needed for adopting the Riba‑free modes of operation and what is the thinking of the State Bank of Pakistan as to the practical steps needed to be taken for creating of necessary infrastructure and establishment of the bodies or institutions for introducing, managing and monitoring the Riga‑free economy. We can only express regret while noting that due thought has not been given by the concerned authorities/officers of the State Bank to various recommendations made by Commissions and bodies constituted. by the Government of Pakistan for the purposes of elimination of Riba. Even in this note they have not referred to these recommendations what to say of commenting on their point of view. These bodies are Council of Islamic Ideology, Prime Minister's Committee on Self‑Reliance, Commission for Islamisation of Economy.
The Reports of the Council of Islamic Ideology and the views expressed therein have been noted in the impugned judgment. These need not be reiterated here.
The Prime Minister's Committee on Self‑Reliance in its Report, at pages 49, 50 deals with the Inter‑Governmental Debt, Bank Loans to Government and Non‑Bank Loans to Government as under:‑‑‑
"Inter‑Governmental Debt
These loans are rarely contracted on economic basis nor are such considerations relevant in their settlement. It is quite feasible, as such, to convert such loans on' an interest‑free basis. A rationing scheme could be adopted to decide on future allocational problems in this category of loans. A specific proposal can easily be developed in the context of an award by the National Finance Commission, which is expected soon."
"Bank Loans to Government
These consist primarily of Government borrowing from banks, including from State Bank of Pakistan, against Treasury Bills. The Government's transactions with the State Bank are of a book keeping nature. It is proposed that Government would no longer pay interest on State Bank holdings of Treasury Bill; future borrowing will continue as before except that it would be on an interest‑free basis. In so far as other banks are concerned, existing Government debt will have to be settled by provision of new non‑interest bearing Government paper, which will be redeemed by the State Bank of Pakistan over a five‑year period. This essentially amounts to creating additional reserves of the banks with the State Bank which will be released over a five‑year period. Accordingly, no undue inflationary pressures will be developed in the economy. This will also he profitable to banks as, in return for losing interest on this debt, its low yielding fund [Government pays substantially lower interest rates on these bills relative to its other borrowings] will be gradually released which could be subsequently used for more profitable investments.
After the commencement day of the Ordinance, no new borrowing from banks [except the State Bank] will take place. The commodity operations of the Government can be conducted on the basis of trade related modes of financing. However, if there are losses they should be covered from borrowings from the State Bank of Pakistan.
"Non‑Bank Loans to Government
This consists mainly of Khas Deposits, Defence Saving Certificates etc., and is perhaps the most important component of domestic public debt, which needs special care in its settlement, since it is owned by private individuals. To settle this debt, it is proposed that the Government creates ,a mutual fund out of its shares in selected public sector corporations or Government Sponsored Corporations (GSCs). Salient features of the proposed fund, including a proposed portfolio and 12 Modes of Financing have been given in the Self‑Reliance Report, 1991 as Annex‑6 and Annex‑7. This fund would be managed initially [for three years] by an independent group of portfolio managers appointed by the Government; subsequently, the portfolio managers would be chosen by the shareholders. Share certificates in this mutual fund would be issued to holders of this type of debt, equivalent to the value of their holdings.
The idea of a mutual fund, would be particularly effective in insulating small investors form exposure to risk. The need to minimize risk is important since part of this debt is held also by windows, retired individuals and other small investors, whose risk taking capability is minimal. Through the fund these investors would be allowed to hold a diversified portfolio of shares, thus enjoying the benefits of risk‑spreading.
Also this would be fully in keeping with the Government's policy of privatization and disinvestment, on which there has been no progress. This measure would serve to speed up the implementation of existing Government policy. This would also be a step in the direction of deregulation and would help to increase the efficiency of public enterprises.
As of 30th June, 1989, the book value of the combined assets of these corporations amounted to Rs.800.442 billion and their net equity was more than Rs.100 billion. Given that the market value of the equity is likely to be a multiple of the book value, it should be possible to redeem the full amount of about Rs.155.08 billion of obligations outstanding at the end of May, 1990. This portfolio can be expanded to include T&T, Railways, etc. which have presently been excluded."
This Commission has made with regard to Foreign Public Debt the following comments and recommendations:
"As on 30th June, 1990, the total outstanding and disbursed foreign debt amounted to Rs.345 billion ($15.67 billion). The composition of this debt is biased in favour of Consortium countries which account for some 86 per cent. of this amount. However, within the Consortium,. the debt is fairly diversified with USA holding 23 percent., Japan 14 per cent., West Germany 10 per cent., multilateral agencies 42 per cent. and the rest is held by Belgium, Canada, France, Netherlands, Italy and U.K.
Given the amount of uncertainty involved in settling the matter with the foreign creditors, a variety of scenarios need to be constructed to meet the likely contingencies. In fact the response of foreigners would depend in large measure on how they perceive our motives. As we will show below, the proposed measures should not pose much difficulties for the foreigners as they are not designed to evade our obligations towards them. It is intended in the perspective of moving towards a self‑reliant way of life and hence has no ultra motive, such as a ploy for defaulting on the debts owned by the country.
To ease the process and to ensure that there are no disruptions in economic relations with our creditors, the committee felt that some preparatory time should be given to the Government in which it will negotiate with the foreigners, on a bilateral basis, an interest‑free basis for the existing debt. Unlike the domestic debt, which is proposed to be eliminated with effect from 1st July, 1991, a two‑. year preparatory period is given for achieving this goal in the case of foreign debt. It is proposed that a committee be formed that would hold ‑negotiations with the foreigners.
Thus on the effective date all the principal and interest will become due and payable, unless converted into an interest‑free obligation. The period of two years is hopefully sufficient to arrive at an alternative basis. There will be no restrictions on capital movements if they are done on the basis of non‑interest arrangements ......................................A number of options are available which can form the basis of renegotiating external debt by the proposed committee, as well as to mobilize resources for cases where conversion may not be feasible. The most significant of these methods is the debt‑equity conversions being used extensively by countries facing foreign debt problems. On such method, known as `debt‑equity swaps', requires the debtor country to allow a foreign investor to purchase its debt from the creditor at a discount and convert it into local currency for purchasing a local equity‑based asset. Typically, the creditor is willing to sell the debt at a discount thus allowing the investor to obtain a discount on purchase of local currency. The scheme could be preferentially offered to any non? resident Pakistani with foreign holdings, on a simple conversion basis.
Here, a marginally higher exchange rate would be offered to resident purchasers of debt obligations. In addition, no restrictions should be placed on‑the use of local currency obtained through the conversion. A variant of the scheme could also be offered to resident importers who could mobilize foreign exchange earnings from abroad.
Another source of foreign resources could be disinvestment of shares of public sector corporations to resident and non‑resident Pakistanis in foreign exchange. Such receipts would ‑he particularly useful in releasing the pressures on foreign exchange resources.
Finally, the creditors can be asked to convert their debt into equity in those projects where the fund are used. This is quite feasible as a sizeable amount of foreign debt has been used for on‑lending to private sector through the financial system. Hence the debt is supported by a portfolio of assets; which can allow conversion into equity. "
The Report of Commission for Islamisation of Economy on Elimination of Riba (August, 1997) proposes to enact a law known as Prohibition of Riba Act, 1997 which contains a provision for the settlement of outstanding debts. The proposed section 6 reads as under:‑‑‑
"6. Settlement of outstanding debts. ‑‑‑On the effective date all debts, covered by the prohibition in section 3, and as accrued until the last day, will become due and payable in full; this amount may be settled as follows:
(1)??????? Private domestic parties to a debt will be given six months to renegotiate, on a one time basis, fresh contracts based on permissible forms of financing which may have retrospective validity, i.e. from the date of effectiveness.
(2)??????? Federal Government may re‑negotiate all existing foreign debt, both public and publicly guaranteed (civil and military), on the basis of permissible modes of financing.
(3)??????? Existing domestic public debt, other than inter‑Government and due to State Bank of Pakistan, may be settled by the issue of share certificates in the amount of the debt obligations in the Mutual Fund or by outright retirement through the use of proceeds from the privatization of public assets.
(4)??????? All inter‑Government and SBP debt will be made interest‑free, with effect from the effective date."
The methods of "Settlement and Retirement of Government Debt" proposed in this Report are:‑‑‑
(1)??????? Restructuring of the financial structure, fundamental changes in the conduct and formulation of Government's fiscal policy and a rearrangement of financial relations with the foreign countries. These key economic variables, such as growth, consumption, investment and saving will also be affected by the proposed measures.
(2)??????? The policy regime presents two fundamental problems of economic re‑organization. First, the assessment of the likely impact on the flow of resources for investment; second, the settlement of the existing stock of outstanding debt.
(3)??????? The detailed analysis of the impact on real variables is given in Annex. 3 to the Report wherein it is asserted that the analysis is based on an integrated macro‑economic model and impact in all the key sectors is assessed. The effect of the proposed measures on balance of payments, Government budget, credit plan and the macro‑economic framework are evaluated as under:‑‑‑
Balance of Payments
"We begin by analysing the effects of the proposed measures on the balance of payments (BOP). A number of components of the balance of payments will be affected by the change. Of particular significance are the effects on imports, exports, interest payments, long term capital inflows and foreign reserves. "
Imports
"The proposed measures will prohibit any interest payments on the existing debt. As noted earlier, it needs to be negotiated as to how the existing debt will be settled or converted into non‑interest bearing basis. However, to arrive at a reasonable set of projections we need to make certain assumptions about both the interest payments as well as the flow of capital.
To this end we have adopted the approach to eliminate the entire interest payments and also to stop the flow of future capital. This is the worst possible scenario, as in the presence of positive net transfer of resources, this assumption would worsen the overall BOP position. But at the same time the assumption would allow us to arrive at the bench mark that would result from the worst possible response from the foreigners. Moreover, it would also point out the cushion that the economy would have to meet the debt servicing obligations, in case it decides to retire them without having any settlement with the foreign creditors.
The suspension of future disbursements would have significant impact on imports, since these disbursements are needed to finance them. Accordingly, a cut in imports demand would be inevitable. As an approximation to the size of this cut we assume that imports will decline by the amount of suspended disbursements plus any decrease in exports, in the first year (i.e. 1998‑99). Thereafter, imports are allowed to grow at the same rate as in the Base Case.
How the cut in imports will be achieved. There are essentially two ways to adjust to this problem. First, we may reduce the imports by drastic controls, which would allow us to maintain the present path of exchange rate movements. Second, the market may be allowed to freely arrive at a new equilibrium, which would essentially involve a combination of both import reduction and exports expansion.
For a variety of reasons, the second option is superior, as the recommendation is basically in line with the policy changes initiated in the country over the last two decades. This would require further liberalization of the foreign exchange market, which incidentally is on the agenda of the Government.
A comparison of the‑ imports under the new regime, denoted as Prohibition of Riba Act (PRA) case, with the Base Case projection is given below:
???????????????????????????????????????????????
Table 1
??????????????????????????????????? ?Comparison of Imports
??????????????????????????????????? ?(million dollars)
| | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | 1996-97 | 1997-98 | 1998-99 | 1999-00 | 2000-01 | 2001-02 | | Base case | 11972 | 13096 | 14267 | 15574 | 17001 | 18559 | | PRA | 11972 | 13047 | 9952 | 10846 | 11819 | 12880 |
???????????
Exports
Essentially, there are two ways in which our exports could be affected because of the new policy regime. First, exports intensive in the use of imported inputs would be affected by a reduction in imports. Second, because of uncertainty as to the nature and working of the alternative system, resulting from the policy change, the foreigners may show some reluctance in the beginning in entering into new exports contracted until things become clear.
An examination of the existing classification of exports reveals that some 40 per cent., of exports are primary and semi‑manufactured, which are intensive in domestic inputs. More than 60 per cent. of the remaining manufactured exports are also intensive in the use of domestic inputs. Thus, our exports have a low dependence on imported raw materials. Hence, it can safely be argued that the Base projection of exports will be unaffected.
However, one must allow for the uncertainty factor noted above.
Accordingly, we have assumed an immediate cut of about 20 per cent. in exports for the first year. Thereafter, exports are allowed to grow as in the Base Case. Exports in alternative regimes compare as follows:
??????????? ??????????????????????? Table 2
??????????????????????????????????? Comparison of Exports
??????????????????????????????????????????????? (million dollars)
| | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | 1996-97 | 1997-98 | 1998-99 | 1999-00 | 2000-01 | 2001-02 | | Base case | 8355 | 9678 | 11211 | 12987 | 15043 | 17426 | | PRA | 8355 | 9642 | 8903 | 10274 | 11857 | 13685 |
Invisibles
On the invisibles account, the only item that will be. affected significantly from the policy change is interest payments on foreign debt. These payments will be suspended. Since a significant reduction in imports has been allowed, some adjustment in other payments, which includes such things as shipment/freight has been made to reflect the change. Thus on the payments side besides these changes no other change will take place.
On the receipts side, there will be no change; a significant part of such receipts are in the form of remittances, for which there is no reason to allow for a change, while most of the remaining part comes from non‑factor income, which would also be largely unaffected by the change. As a result of this adjustment the invisible account‑ will experience significant improvement relative to the Base Case. A Comparative position is presented below:
Table 3
Comparison of Invisible Trade
(million dollars)
| | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | 1996-97 | 1997-98 | 1998-99 | 1999-00 | 2000-01 | 2001-02 | | Base case | -2485 | -3102 | -3278 | -3438 | -3586 | -3711 | | PRA | -2485 | -3102 | -856 | -783 | -703 | -617 |
As a result of improvement in both the trade and invisible accounts, the current account would also experience significant improvements and would only marginally be negative over the 5‑year period. This improvement should be viewed as a surplus that can be used to design countervailing measures for offsetting the decline in net capital inflows and in restoring the domestic absorption capacity which will be reduced because of a sharp decrease in import demand. Thus the surplus has been used to restore the level of imports to the maximum possible level. Hence small deficit, that can be easily financed from the residual capital flows, in current account is allowed. The comparison of Base Case with PRA is given below:
Table 4
Comparison of Current Account
(million dollars)
| | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | 1996-97 | 1997-98 | 1998-99 | 1999-00 | 2000-01 | 2001-02 | | Base case | -4628 | -5128 | -4900 | -4521 | -3964 | -3185 | | PRA | -4628 | -5141 | -473 | 151 | 915 | 1846 |
Long Term Capital
As noted earlier, under the new policy the new policy regime disbursements on existing commitments of loans will be suspended until a settlement is reached. This will be true to the extent that such commitments are interest‑based. Essentially all the foreign loans, short and long term, fall in this category. Thus we have eliminated all flows of foreign capital, both long term and short term during the period under consideration. A comparative position of the capital flows is given below:
Table 5
Comparison of Capital Flows
(million dollars)
| | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | 1996-97 | 1997-98 | 1998-99 | 1999-00 | 2000-01 | 2001-02 | | Base case | 3018 | 5285 | 5074 | 4968 | 4866 | 4370 | | PRA | 3018 | 5285 | 0 | 0 | 0 | 0 |
Reserves
The resulting position of basic balance is sustainable though in the first two years it draws slightly on the reserves, but as the current account improves in subsequent years the position of reserves improves. Indeed the position of reserves is that on average, in subsequent years it provides for an average 7 weeks of imports. The comparative position of gross reserves under the alternative scenarios is given below:
??????????????????????????????????????????????? Table 6
Comparison of Reserves
??????????? (million dollars)
| | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | 1996-97 | 1997-98 | 1998-99 | 1999-00 | 2000-01 | 2001-02 | | Base case | 945 | 1133 | 1339 | 1820 | 2757 | 3978 | | PRA | 945 | 1120 | 679 | 864 | 1819 | 3695 |
Second pro forma regarding settlement of debts has been dealt with in Annexure 2 to the Report and the proposals made read as under:‑‑
Outstanding Stock of Debt
The proposed measure will immediately pose a problem of settlement of the outstanding debt. This obviously will affect both public and private sectors. In each case what is needed essentially is to either retire the debt or convert it into one of the permissible modes of financing as provided for in the Act. To be sure, in every case where the stock of debt is supported against an asset, the stock can be converted to a permissible mode of financing. Where this is not possible the debt must be retired within a stipulated time.
Foreign Public Debt
As on 30‑6‑1997, the total outstanding and disbursed foreign debt amounted to Rs.924 billion ($23,106 million). The composition of this debt is biased in favour of Consortium, the debt is fairly diversified with USA holding 12.47 per cent., Japan 16.38 per cent., Germany 7.12 per cent., multilateral agencies 48 per cent. and the rest is held by Belgium, Canada, France, Netherlands, Italy, Sweden and U.K.
Other than the long‑term loan, which is largely from official channels, in recent years, particularly after the onset of the so‑called foreign exchange reforms in 1991, a significant amount of short‑term debt has also been acquired by Pakistan. As on 31‑3‑1997, the outstanding amount of short‑term loans was estimated at some Rs.400 billion (US$ 10 billion) in foreign current accounts held mostly by Pakistani residents, and Rs.211 billion ($ 5,270 million) held mostly by foreign banks.
As for foreign creditors (short and long term), their response will depend in large measure on how they perceive our motives. Given the amount of uncertainty involved in settling the matter with the foreign creditors, a variety of scenarios need to be constructed ‑to meet the likely contingencies. As we will show below. The proposed measures should not pose such difficulties for the foreigners as they are not designed to evade our obligations toward them. It is intended in the perspective of moving toward an Islamic economic system, and hence has no ultra motive, such as a ploy for defaulting on the debts owed by the country.
To ease the process and to ensure that there are no disruptions in economic relations . with our creditors, the Act gives more time to Government for settling or re‑negotiating the debts with the foreigners, unlike the domestic private transactions which are required to be settled or re‑negotiated with immediate effect. The Government must form a committee for this purpose which may begin negotiations well in advance of the effective date.
Thus on the effective date all debts accrued until then will become payable and due in full, unless converted into a permissible form of financing. The period of 18 months allowed for this purpose is hopefully sufficient to arrive at an alternative basis. There wilt be no restriction on capital movements if they are done on the basis of permissible arrangements.
A number of options are available which can form the basis of renegotiating external debt by the proposed committee, as well as to mobilize resources for cases where conversions may not be feasible. The most significant of these methods is the debt equity conversions being used extensively by countries facing foreign debt problems. Since the greater part of our loan portfolio is from official sources, unlike the commercial debt which attracted such methods, a natural ready market for this purpose may not emerge. Still the idea is fully applicable if for instance a scheme can be drawn where specific public assets may be offered for sale with the exclusive purpose of retiring well targeted debt obligations.
Although no official reports are available indicating the likely value of assets that are target of privatization? a recent statement of Government indicated that such assets are at least worth $30 billion. This is a conservative estimate, but fairly capable to meet the present level of obligations, if all of them were required to be retired, which obviously would not be the case, as a significant portion of the foreign loans must be secured against specific assets which can be used for conversion to a permissible mode of financing.
Domestic Private Debt
This kind of debt is contracted by private parties. Private sector and public sector enterprises' borrowings from commercial banks and development finance institutions (DFIs) constitute bulk of this debt. A limited amount of such debt also consists of transactions between private parties, such as directors' loan, etc. After the implementation of the ‑measures during 1979‑‑‑85, such borrowings [excluding foreign currency loans] are contracted on the basis of one of the 12 modes of financing approved by the State Bank of Pakistan. As noted elsewhere in this judgment, serious objections were raised by Islamic Scholars on the permissibility of such modes in Shari'ah. Thus it may appear that this kind of debt will pose major restructuring problems. However we contend that this type of debt is easiest to settle along the lines of permissible modes of financing.
Given the fact that consumption loans are rare in the country, the entire private debt is supported by a corresponding portfolio of assets. Hence, a conversion of this debt is quite feasible. The permissible methods, as illustrated in the report of the Commission on banking and finance, and provided for in the Act, are fully adequate to support this conversion exercise. Foreign currency loans, if required to be settled, would be settled along the lines indicated in public foreign debt.
Domestic Public Debt
These Public Debts consist of debts incurred within Federal and Provincial Governments, between Government and private persons/entities, and between Governments and banks, including State Bank of Pakistan. The proposal in respect of the debts incurred through these channels are the same as were given by the .Self‑Reliance Committee. These have been noted above. It is also asserted that as on 30th of June, 1996 the value of investment made in the National Savings Scheme was Rs.304 billion and the value of assets at the disposal of the Government is sufficient to meet these obligations provided it undertakes an exercise in earnest and does not fritter away the proceeds.
The concluding remarks toward the end of the Report emphasize that as the familiarity with the new arrangements develops and the apprehensions of foreign investors are removed together with the settlement of existing debt, these flows of long term capital from the source eliminated would resume and secondly there might be some strong retaliatory measures adopted by the lending countries against our trading interests. Such measures could include restricted access to export markets, freezing of reserves and other assets held abroad and restriction from the membership of multilateral agencies. Though there are strong reasons to believe that the likelihood of such measures is very low but it would be pertinent to address these doubts. The measures which the Consortium countries in retaliation countries may take and the impact of the steps taken to eliminate Riba on Defence Imports, Government Budget, Credit Plan and Macro‑Economic Framework have been detailed in the Report on Elimination of Riba as under:‑‑
" 19. The retaliation could come from Consortium countries who would be forced to rearrange their contracts on a non‑interest basis. However, the institutional arrangements in these countries would not allow sweeping changes in policy, unless a‑ situation of hostility is developed with Pakistan. The economic system in these countries is market oriented. If the apprehensions of the market are removed, for which we have already allowed sufficient time, there is no reason why we should suffer from this reorganization. Finally, the trade relations of Pakistan are fairly well diversified. These could only be damaged if a joint action is taken by the trading partners, which is highly unlikely.
The possibility of freeze on reserves and other assets again assumes a situation in which there is hostility against Pakistan. With effective diplomacy, this need not be so. In the last resort we could always place our reserves in neutral countries. Future accumulation of reserves would be insulated from this possibility. Also, we would need to withdraw our reserves anyway so as to place them on a non‑interest basis., either by converting them into gold or to other approved basis.
Finally, on the possibility of losing our membership in multilateral agencies, we would like to cite the comments of IFC regarding its willingness to participate in; investment financing on the basis of profit‑loss sharing (cited earlier). The IFC was keen opt this issue but was discouraged when it discovered that. the Government was not enthusiastic. IMF has also shown considerable interest in the new system. It would be interesting to note that IMF has expended considerable effort on research in this area. At one time, the IMF Board had deliberated on one such report and commented favourably on the possibility of IMF getting into such arrangements.
On the domestic economy there could be some adverse effects on the rate of inflation. This will happen both because of likely shortage of imported goods, and a temporary shift away from bank deposits to speculative physical assets. To control the market, Government will have to revise its exchange rate policy. A suitable upward revision in the exchange rate will be required, not only to discourage flight of capital, but to encourage exports and workers remittances. We will discuss this issue in detail both in the discussion on fiscal policy in the next session on adjustment policies.
Defence Imports
Government Budget
The budget would be affected in a number of ways. Despite the suspension of debt servicing, the balance of payments implications discussed above have profound impact on the budget. The public capital flows, proposed to be eliminated, are used in financing the budget. Hence to that extent sustaining the level of current spending would be a problem, particularly if substitution between local and foreign currency resources is not possible.
The most important effect on the budget, which will counter the BOP effects, would be the requirement for the balancing across both current and development accounts, except for the first two years on account of foreign debt, which is a natural implication of prohibiting Government's power to contract debt. [This condition will be relaxed that the bank borrowing is in proportion to the required increase in money supply to finance the increased output. This is called seigniorage].
Obviously, this would put serious limitations on Governments spending options. Apart from meeting its current expense, it will have to throw up some savings to finance the development expenditure. One of the recommendations of the Commission is to limit the economic role of the Government, particularly it be excluded to undertake any such projects where markets exist and private sector is willing to bear the burden of investment. This would mean that Government's ADP activities will largely be restricted to social sectors.
Based on these changes the comparative position of various components of budget relative to the based is reported below:
??????????? Table 7
Comparison of Indirect Taxes
(Rs. In billion at current prices)
| | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | 1996-97 | 1997-98 | 1998-99 | 1999-00 | 2000-01 | 2001-02 | | Base case | 223 | 252 | 294 | 345 | 405 | 476 | | PRA | 223 | 252 | 287 | 327 | 374 | 428 |
??????????????????????????????????????????????? Table 8
??????????????????????????????????????????????? Comparison of Total Reserves
??????????????????????????????????? (Rs. In billion at current prices)
| | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | 1996-97 | 1997-98 | 1998-99 | 1999-00 | 2000-01 | 2001-02 | | Base case | 412 | 482 | 572 | 666 | 777 | 906 | | PRA | 412 | 482 | 564 | 648 | 744 | 428 |
??????????????????????????????????????????????? Table 9
??????????????????????????????????? Comparison of Total Expenditures
??????????????????????????????????? (Rs. In billion at current prices)
| | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | 1996-97 | 1997-98 | 1998-99 | 1999-00 | 2000-01 | 2001-02 | | Base case | 621 | 709 | 831 | 978 | 1136 | 1320 | | PRA | 621 | 709 | 521 | 591 | 670 | 760 |
??????????? Table 10
Comparison of Overall Deficit
(Rs. In billion at current prices)
| | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | 1996-97 | 1997-98 | 1998-99 | 1999-00 | 2000-01 | 2001-02 | | Base case | -209 | -228 | -259 | -312 | -359 | -414 | | PRA | -209 | -228 | 43 | 57 | 74 | 96 |
Credit Plan
There are no serious repercussions of the proposed measures on the Credit Plan as envisaged in the Base Case. There are essentially two ways in which the credit expansion will be affected from the change. Changes in net‑foreign assets and the bank‑borrowing by the Government. However, the two will be working in the opposite direction. In terms of their relative impact, the decrease in monetary expansion on account of Government's reduced demand will be more than offsetting the increase resulting from reserves build up. Accordingly, the monetary expansion shows a much slower growth compared to the Base Case.
A comment on the likely impact on inflation is in order. It appears that the proposed changed would largely have no long term effect on inflation. The projection of the credit plan shows no major shifts in monetary policy. However, there will be some pressure on prices from the resulting pressure on foreign exchange. Since we have recommended market‑based adjustment to this problem, the problem would be short lived, as the market stabilises pressure on prices would also be eased.
Macro Economic Framework
Table 11
Macro‑Economic Framework
(5 Years totals)
(Rs. In billion in current prices)
???????????
| | | | | --- | --- | --- | | | Base Case | PRA | | GDP(fc) | 13682 | 13608 | | Indirect taxes (net) | 1736 | 1633 | | GDP (mp) | 15418 | 15241 | | Net Factor Income | -27 | 334 | | GNP (mp) | 15391 | 15575 | | Net Foreign Resources | 689 | 238 | | Total Resources | 16038 | 15813 |
| | | | | --- | --- | --- | | Consumption | 13010 | 12876 | | Investment Fixed Public Private | 3071 2835 1843 992 | 2937 1756 946 235 | | Changes in Stock | 236 | 235 |
Compared to a growth rate of 6.76 % achievable under the Base Case, a slightly lower growth rate of 6.5‑1 % is achievable under the new policy regime, which is basically resulting from an decrease in domestic absorption capacity due to a reduction in imports. There is, therefore, no threat of a drastic reduction in the standard of living on account of the new policy initiative as the economy would suffer a nominal reduction of 0.25 percentage points in its growth.
A complete set of projections across the Base Case and PRA are given in the Appendix.
The policy measures recommended are quite feasible and will considerable smoothen the adjustment path of the economy. A slight reduction in the growth rate is witnessed, which could be eliminated by worsening the current account. However, the entire policy framework of the Base Case, along with the conservative projection of balance of payments, is retained. This is the bench mark impact of PRA without any policy support and no knowledge about the settlement of the existing debts as well as future capital. The economy cannot do worse than this. The policy changes would be and large improve economic performance over this bench mark impact.
These policy measures also dispel fear of inflationary pressures noted earlier. First, there is a considerable relief on monetary expansion because of a much smaller amount of bank borrowing under the new regime. Second, the new taxation measures could help to curb the demand, which have not been imposed at present. Finally, the reserves position is at a manageable level. Accordingly, there is no possibility of inflation getting out of hand in the country. "
Due notice of the above should be taken and preventive measures and other necessary precautions cannot be over‑emphasised.
The question "how to deal with the current debts, the economic effects of borrowing and alternatives to such borrowing?" has been
"Switching to the Islamic economic system does not mean giving up the settlement of outstanding debts contracted under a conventional system. As such debts have had risen from past contracts and obligations, and as Muslims should honour the conditions and contracts they had accepted, the principal and interest amounts of such debts should be settled, regardless of whether they were contracted with domestic or foreign parties.
Should a country find it difficult to secure the liquidity required to settle all its outstanding debts, it could resort to one of the following solutions:
A.??????? PURCHASE AND SWAP OF FOREIGN PUBLIC DEBT
It is a well‑known fact that the outstanding debts of developing countries, which are facing economic difficulties, are offered in markets at prices less than their nominal value; the amount of discount given varies with the economic conditions of each indebted country. It is known also that it is possible to negotiate the cash purchase of such debts or swap them with equity and get, at the same time, more discounts on the price of those debts.
Government is developing countries tend to have a large public sector, which could be privatized in the course of a comprehensive structural adjustment programme. A part of the proceeds obtained from selling some of the public enterprises could be utilized in purchasing foreign debts at a discount, or swapped with equity in the newly privatized enterprises.
B.??????? PURCHASE AND SWAP OF DOMESTIC PUBLIC DEBT
It might be preferable to begin with the process of swapping domestic public debt with equity participation in public enterprises undergoing privatization, or utilize part of the proceeds of such privatization in its settlement ????????????. Countries would be well steering away from borrowing as much as possible and is using, instead, the Islamic modes of financing.
III. ALTERNATIVES TO FOREIGN BORROWING
What can an Islamic country do to benefit from foreign financial resources? The kept to the answer lies in the innovative utilization of financial markets to attract foreign capital. Dialogue with foreign financing institutions may get them to appreciate the advantages of using the Islamic modes of finance, while making foreign financing more efficient and effective in economic development. Such dialogue to be more effective if other countries are to participate in it.
In this context, the following methods may be considered for adoption:
A.??????? Issue of Islamic Financial Instruments in Foreign Currencies.
B????????? Design Special Funds to Cater for the Needs of Specific Projects and Sectors such as:
stations... etc.;
2.? A leasing fund;
A trade financing fund;
An agricultural investment fund;
5.???????? An industrial investment fund
6.???????? A housing investment financing fund, and
7.???????? A fund for financing of a specific project.
C. Profit sharing.
This could be an effective means to attract venture capital as well as to finance working capital.
Profit sharing certificates can be issued by enterprises as well as banking and financial institutions in foreign and domestic currencies to attract resources.
D. Interest‑free loans like the ones provided by the Islamic Development Bank for . which it charges the actual service charges.
IV??????? WHEN IS IT PERMISSIBLE TO BORROW?
Should an Islamic country exhaust all the alternatives to foreign borrowing without succeeding in satisfying its needs, could it resort to interest‑based borrowing?
The answer to this question is based on the general Islamic juridical rule stating that "Necessity renders legitimate that which is originally illegitimate". The principles of necessity it left for the discretion of Sharia'h scholars in each country to decide after full and accurate understanding of the country's real conditions. From the viewpoint of the Bank, interest‑based foreign borrowing is only for cases of compelling need, which amounts to `necessity' for development purposes, or to cover necessary Government expenditures.
Feasibility studies of the projects to be financed by way of foreign borrowing should be undertaken, scrupulously reviewed and evaluated. Borrowing should be made to the extent of such necessity only and accompanied by a plan and schedule for repayment from the returns of the project to be financed, or from specifically earmarked Government revenues."
At this stage the views of some of the economists expressed in the presentations made before the Court may be noted.
Dr.Waqar Masood Khan, Vice‑President, International Islamic University posed the questions: Should these obligations continue to remain?; whether they will be allowed to mature?; and whether they will be settled either through conversion or retirement? In case such a possibility exists, whether the conversion would be acceptable to debt‑holders and, in the case of retirement, where would the resources come from. According to him very little revenues are available to finance interest payments which are largely financed from additional borrowings. Resultantly the extension of prohibition to Government finances could only be possible when, besides discontinuing future interest‑based transactions, the existing obligations are either retired or converted to a Shariah compliant form. The proposal to allow these obligations to mature is. thus not feasible. This would entail continued borrowings, and such borrowings could only be possible on interest basis which would mean that effectively the prohibition would not be applicable to Government finances. It is for this reason that the elimination of Riba from Government finances is most problematic and would require extraordinary efforts. He has further noted that in the Report of Prime Minister's Committee on Self‑Reliance (April, 1991) the experts' proposal to the effect that these obligations, at an appropriate date, may be declared as due and payable and ways be devised to either retire them or convert them in other forms which would be Shariah compliant. This scholar answering the question whether it will be practical to imagine that a settlement can be made of these obligations observed that the settlement would be a formidable problem, but not something that cannot be imagined. It is added that the monopoly over fiat money gives people confidence that it will not renege on its promise to repay the principal with interest. So the Government is neither constrained to build a portfolio of profitable assets to ensure servicing of ensuing obligations nor does it care to distinguish between borrowed resources and revenues it receives from taxes and non‑tax sources. Moreover, there are assets that the Government has built over a long period of time, other than those against which specific loan obligations are clearly identifiable. He has identified the possibilities to accomplish the goal as under:‑‑‑
SBP Obligations
These obligations arc basically book‑keeping entries as the SPB is essentially a Government‑owned body. There is no need for any adjustment on this account. Borrowings from SBP, which arc notional, would continue to remain available to the Government in future as well with the only difference that no interest cost will be attached to such borrowing‑
Inter‑Governmental Debt
These are the transactions between the Federal Government and the Provincial Governments primarily and are not regulated on market and economic principles and these being internal transactions of the State are merely book‑keeping transactions. In these cases, for future transactions, a question of efficiency of use of scarce resources will be raised, which the interest rate is supposed to regulate. Again, Islamic instruments of finance can be found that can regulate the use of resources in the desired form, otherwise the only option is to adopt a system of rationing the parameters of which will largely be determined by political and social considerations.
Banks and Financial Institutions Obligations
These obligations are largely the Treasury Bills and Federal Investment Bonds of the Federal Government held by these institutions. As these institutions have to make these investments under Prudential Regulations, the adjustment of these obligations was proposed to be made by a number of ways such as, firstly, through privatisation of public sector assets; secondly, through conversion into a non‑earning paper of the Government redeemable over a period of time (say five years), but which can be used for the purpose of reserve requirements and other statutory requirements such as liquidity ratio and credit‑deposit ratio; and thirdly, the State Bank may assume part of these liabilities and remunerate them on the basis of its own profit and loss position. Explaining the third proposal the scholar added that a Central Bank can play active role in market stabilization by taking positions in the capital and money markets with motivation of market stabilization as arc opposed to profit earning. .Its control over money supply makes it a unique player in terms of the influence it can exercise in the functioning of the market. Thus, the Central Bank will have an active investment‑cum‑regulatory role which would provide it enough leverage to influence the market. Its own securities, which would not be interest‑based, and its investments in capital and money market would generate significant returns which it can share with its security holders.
Obligations of General Public
Dr.Waqar Masood in his submissions urged that in terms of its risk bearing capacity, the investments made by the individuals and organizations in various savings schemes of the Government constitute a sensitive group and as such needs special care in devising a plan to adjust the obligations of this group to a Shariah compliant form. The most desirable form in which the adjustment can be accomplished is to replace these liabilities by the equity of Government in its economic projects, provided appropriate resources are available. The retirement of these liabilities generating necessary resources by selling Government assets was commented upon as under:‑‑‑
"Leaving aside, for a moment, the adequacy of Government's assets, suppose these assets exist. Would it be desirable to sell them and use the proceeds to retire these obligations, or trade these obligations against the value of Government's equity in such assets? Ideally a combination of the two will be required, but largely it should be the second form that should be used. The reason for this is the fact that the economic assets of the Government, having the capacity to meet such huge obligations, are of a strategic nature. The sums involved in their outright sale may not be easily forthcoming from the local market. Inevitably, one will have to search for foreign investors to bring the required resources. However, considering the sensitive nature of such assets, the nation may not want to see them go in the hands of the foreign investors. Accordingly, the option of outright sale may not even be feasible. This leaves us with the trading option, i.e. to buy the obligations against the transfer of Government ownership of such assets."
So, best form to accomplish this conversion is to form a grand mutual fund of all Government equities in its economic projects, and after proper valuation the certificates of such a fund may be given in lieu of the obligations. The two questions which are fundamental to the success of this scheme i.e. (i) Does the Government has adequate assets to be transferred to such a mutual fund so that it may meet the obligations? And (ii) How the fund would be managed?, were answered in paragraphs 131 and 132 of the written submissions as under:‑‑‑
"131. Regarding the adequacy of Government resources, no published data is available to satisfactorily determine this question. However, it is possible to identify the nature of these assets and reflect on their commercial nature. At present, by and large, all infrastructure projects are owned by the Government Projects belonging to Power, Water, Highways, Telecommunications, ports and shipping, aviation, dams, oil and gas sectors are in the ownership of the Government. In terms of specific commercial entities, Pakistan Telephone Corporation, WAPDA, KESC, OGDC, KPT, PNSC, PIA etc. are owned by the Government. Besides infrastructure, a number of banks and financial institutions are still operating in the public sector. In mid‑'97, according to a news item, while briefing the Prime Minister on the potential of privatization, a figure of $30 billion was indicated as the value of assets that would be up for privatization. However, it is the Government alone that can undertake a reliable exercise on this account and determine the adequacy of this scheme. Many of these corporations may not be profitable bodies at present, but their potential be become as such is doubtless. It would therefore be fair to assume that the overall fund would indeed generate a reasonable return to the certificate holders.
Foreign Transactions
Dr.Waqar Masood has noted that the long term debt is largely product related and hence in principle specific assets were created against them and even some assets were created in case of short term debts though ready identification of such assets may not be possible. He adds that wherever assets are available, a conversion of foreign liability into a Shariah compliant form would be possible, except perhaps the response of the foreigners may pose some difficulty. Where assets cannot be identified, the methods discussed in the context of settlement of Government obligations would have to be resorted to by offering mutual fund certificates or alternatively a portion of the fund may also be offered in the foreign markets, and the proceeds may be used to retire such obligations. He further commented that there is no reason to believe that response of the foreigners would be adverse, so long as they are made to understand that their investments are protected and future transactions would continue to be allowed based on commercially viable principles of financing that are consistent with the requirements of Shariah, and that it is a matter of education of the foreigners that by eliminating interest the country is not restricting the scope of business transactions rather it is only eliminating a method of such transactions. Throughout the world, Islamic banks and financial institutions are operating on profitable basis, a large number of well known financial institutions have opened special counters and departments that deal exclusively on the basis of Islamic principles of finance so the country would not be embarking on a venture which is unknown or untested, and that so long as the foreigners believe that the move is not motivated by a desire to evade obligations to them, there is no reason to suspect that their reaction would be hostile. However, it will still be prudent to allow a longer period, to say a period of two years, for acquiring the foreign transactions to be brought in conformity with new system.
Dr. Shahid Hasan Sid4iqui, Chairman, Research Institute of Islamic Banking and Finance in his verbal submissions as well as in his written submissions has also dealt with the subject of borrowing and debts. The Magnitude of the Problem was manifested by Dr.Shahid Hasan Siddiqui by putting across the comparative position of 1988 i.e. after 41 years of independence and ten years later in 1998 by citing the following table:‑‑‑
| | | | | | | --- | --- | --- | --- | --- | | S. No | Item | 1988 | 1998 | Rise in ten years | | (i) | Public debt | 520 | 2518 | 1998 | | (ii) | Stuck-up Advances | 39 | 250 | 211 | | (iii) | Qarz-utaro Mulk Sanwaro Scheme | - | 17 | 17 | | (iv) | FCAs utilized ($10 b converted at prevailing rate) | - | 460 | 460 | | (v) | Privatization proceeds | - | 58 | 58 | | | Total | 559 | 3303 | 2744 |
These public debts are required to be repaid and losses in respect of stuck‑up advances recouped from the taxes of the common man and by paying lower fates of returns to the depositors of Banks/DFIs respectively. According to him the causes of this evil are large scale corruption, persistence with interest‑based economy, Government's exorbitant/wasteful expenditures, poor revenue collections and foreign exchange outflow exceeding its in?flow. The resultant budget deficit and adverse balance of payment position have been forcing successive Governments to impose heavy taxes and resort to more and more domestic and external borrowing and stage has reached that the public debts, instead of meeting the budget deficits, have become biggest source of creation of these deficits. Due to this, the negative effect of the IMF conditionalities are also making the task of movement towards Islamic system of banking more difficult. He cited CBR's reports to show that the revenue declined from 12.4 per cent. of GDP in 1995‑96 to 11.7 per cent. in 1996‑97 and further to 10.6 per cent. in 1997‑98, though in 1998‑99 the position has improved. According to him the solution of the problem of budget deficit can be solved as under:‑‑‑
"Rupees in billion
S. No?????????????? Particulars??????????????????????????????????????????????????????????????????? Position on
??????????????????????????????????????????????????????????????????????????????????????????????????????????? 30‑6‑99
_____________________________________________________________________________________________
(i)???????? Desired tax revenues‑18% of GDP?????????????????????????????????????????? 520
(ii)??????? Budget projections Rs. 354 b, subsequently????????????????????????????? 310
??????????? reduced to Rs. 318 h, which may not be achieved
(iii)?????? Room for additional recovery??????????????????????????????????????????????????? 210
(iv)?????? Projected deficit in the budget?????????????????????????????????????? 134
(v)??????? Possible Surplus budget ?????????????????????????????????????????????????????????? 76
In the humble opinion of this writer it was also within the Government's reach to obtain additional resources/savings as under, even in the financial year ending June 30, 1999:‑‑‑
Rupees in billion
S.No Item??????????????????????????????????????????????????????????????????????????????????????????? Amount
____________________________________________________________________________________________
(i)???????? Surplus budget as aforesaid?????????????????????????????????????????????????????? 76
(il)??????? Savings ' due to prudent utilization of Development??????????????????? 55
??????????? Expenditure (according to official sources about 60%
??????????? of expenditure is misappropriate/wasted
(iii)?????? Restoring the profitability of public sector enterprises ??? 90
??????????? at 1995‑96 level (Profitability declined from Rs.42.2
??????????? b, in 1995‑96 to Rs. 1.7 b, in 1997‑98)
Total Savings/additional resources ??????? ??????????????????????????????????? 261
____________________________________________________________________________________________
It will be kindly seen that the projected budget deficit of Rs.134 billion for the financial year ending June 30, 1999 could have been converted into a surplus budget and additional resources of Rs.261 billion generated. In any case, there would also be substantial reduction in debt servicing liability due to re‑scheduling of Pakistan's external debts, the full impact of which would be fully known after a decision is made by the London Club.
There is now an urgent need of allocating, from the surplus resources so created at least Rs.20 billion per year for providing basic health care, primary education, safe drinking water and sanitation facilities. In addition, Rs.40 billion per year should also be diverted for providing subsidy on items like Atta, rice, ghee, and petrol etc. These steps are essentials for achieving the "Maqasid‑e?-Shariah".
It may, however, be submitted that all this will necessarily requires a total change in attitudes and difficult and tough decisions will have to be taken."
It is unfortunate that we are not in a position to comment on this proposed solution as neither the representatives of the State Bank of Pakistan nor of the Finance Division or the Law Division thought it fit to attend the hearings even to note these contentions or to submit written submissions in respect thereof. The only written submissions made by Mr.Muhammad Ashraf Janjua contained the State Bank's own point of view which have been duly noticed in the paras. above These comments do not take notice of the submissions of any of the economist, scholar or Islamic Development Bank.
Domestic Debt
Dr.Shahid Hasan Siddiqui adds that in view of the submissions made by him as noted above there should be no need to take any domestic loan except for securing finances for essential projects for which second line techniques should be resorted to in addition to Musharaka financing. The so‑called prestige projects with questionable economic justification must be abandoned forthwith or "Qard‑e‑Hasna" as a source of security funds should be used in case of need by the State but there seems to be little scope of this source as after the launching of Prime Minister's Debt Retirement Programme, the Government shattered the confidence of the nation by securing such loons as were never taken in the history of Pakistan.
External Debt:
He (Mr.Shahid Hassan Siddiqui) argued that the following statistics, facts and suggestions provide a ground for action packed approach:‑‑
(i)???????? A former US Consul‑General to Pakistan, in 1997 twice said that a sum of $100 billion has been looted from Pakistan and transferred abroad. He expressed the view that if this wealth could be retrieved, Pakistan could re‑pay the entire external debt and there would be no need for securing loans and credits in future.
(ii)??????? Mr.Malik Mairaj Khalid as Caretaker Prime Minister said that he has been informed by international financing agencies that a significant portion of the external loans accrued by Pakistan have found their way in the Western banking system outside Pakistan.
(iii)?????? There are reliable reports to suggest that in total violation of State Bank regulations, resident Pakistanis are maintaining deposits of about $40 billion in banks abroad. These resident Pakistanis include politicians, policy makers, powerful feudals, big industrialists and, traders, defaulters of Banks/DFIs retired and serving bureaucrats and the like.
The actions he proposes are:‑‑‑ .
(i)???????? An Ordinance should be promulgated making it obligatory for all resident Pakistanis to transfer their accounts from abroad to Pakistan within 45 days. If a person gives information in proof of an account of a resident Pakistani still being maintained abroad after expiry of this period of 45 days, he should be offered a percentage of deposits as a reward.
(ii)??????? All members of Parliament are required to submit declarations to the Chairman Senate or the respective Speakers after 45 days declaring that they and their dependent family members whether living in or outside Pakistan are not maintaining accounts abroad. Similar declarations should be required to be submitted by all State functionaries including, economic managers to the competent authority.
(iii)?????? All borrowers (existing and prospective) having advances of Rs.0.5 million and above should also be required to submit such declarations to the Banks/DFIs.
According to Dr.Shahid Hassan Siddiqui, if only 25% of the deposits held by resident Pakistanis in violation of .the existing laws are brought back to the country, Pakistan could get rid of the international debts and also can adopt the policy of not taking external loans and credit except project related financing. Non‑resident Pakistanis are reported to be having deposits over $35 billion outside Pakistan. The restoring of the credibility of the Government and improvement in the investment climate of the country is a must for the transfer of a substantial portion of these funds to Pakistan. He referred to the conversation of the two billionaires held in the, presence of Mr.Khalid M. Ishaque, Advocate who had during his submissions before the Court disclosed the said conversation. He stated that two Pakistanis are saying to each other that both of them, if put together their resources, can meet the external debts of Pakistan. Dr. Shahid Hassan Siddiqui stated that Mr.Khalid M. Ishaque should be asked to divulge in confidence particulars of these two Pakistanis and the Government should make a real effort to persuade them to provide necessary funds so that the nation could discharge its debt burden and could have the letters of indebtedness broken for securing their economic independence and the entire nation should not only pay homage to these persons for their nation saving act, and giving them and to their generations a prestigious place, and also to undertake to return to them and to their coming generations the necessary amount in instalments. He suggested that a Constitutional ban should be imposed on the Government restraining it from securing external loans for balance of payment support or fixing parameters and limits of borrowing and that too with the permission of the National Assembly/Parliament. He was of the view that all valid contracts are to be honoured minus interest which in many cases will, however, have to be paid except in the cases of embezzlement of funds and unauthorized loans, and that we may have to continue to pay interest unless. of course, alternate modes of financing are mutually agreed to in respect of the existing debts. Same was the view of Dr.Muhammad Umar Chapra as he has also pleaded honouring commitments with the foreign lenders. ?????????
We have summarized above the position taken by the representative of the State Bank, the apprehensions expressed, the difficulties counted, the explanations offered and the proposals mooted by the scholars, economists and bankers. Formulating of fiscal and monetary policies and the procedure to be adopted to implement those policies so as to effectively achieve the objectives and goals is the task of the State Bank of Pakistan and the Government. This Court is neither possessed of the necessary expertise nor is required under the Constitution to frame such policies or to provide guidelines. We, however, cannot refrain from observing that wasteful expenditure ostentatious living, spend thrift policies must be shunned by all and sundry, from top to bottom. It is common knowledge that the nation has to stand on its own feet and has to depend on its own resources. The wasteful expenditures must be stopped. Everyone of us from top to bottom must live according to standard that we can afford on the basis of our own national resources. All expenditure in the name of protocol duties must come to an end. Everyone, be he Constitutional or public office holder, or a civil servant or a corporate executive must be made to adopt a standard of living which the nation can afford on the basis of its own resources and income. The leaders on the top and the high‑ups have to create examples and we have no doubt in our mind that every member of the society will follow suit without any rancour or hesitation. It is the only method by which we can stop borrowing for even meeting our day‑to‑day expenses.
If these measures are adopted then those sons of the soil who have kept their wealth in the foreign banks will also feel motivated to join the nation in offering their wealth to sustain the country by having their debt burden released by making available their wealth in liquidation of the debt burden, and will thus relieve the nation of the economic slavery of international agencies such as IMF and World Bank and would thereby secure and preserve economic independence of the country. We have to recall that our ancestors when called by the Holy Prophet (peace be upon him) laid their entire wealth at the feet of the Holy Prophet (peace be upon him) saying that for them the Allah Almighty and His Prophet are sufficient sustainers and reckoners. The sons of soil and the believers will still be prepared to offer the entire belongings provided they are assured that their sacrifice will not go waste and will not be scalded away by others through extravagance or digression. The formation of these policies as indicated in other part of this judgment is to be secured by the Parliament by framing necessary laws securing proper monitoring of the public accounts and the Consolidated Funds by enacting an Act in compliance with the mandate of the Constitution. This law should also ensure the transparency in addition to securing national fiscal and monetary interest in line with the objectives of Shariah by following principle of Ijtehad. The Parliament in the present days circumstances, as opined by Allama Muhammad Iqbal, the thinker and the great philosopher of the nation, is the appropriate forum for conducting Ijtehad in all such matters. Allama Muhammad lqbal in his book "The Reconstruction of Religious Thought in Islam" observed as under:‑‑
"The growth of republican spirit and the gradual formation of legislative assemblies in Muslim lands constitute a great step in advance. The transfer of the power of Ijtehad from individual representatives of schools to a Muslim legislative assembly which, in view of the growth of opposing sects, is the only possible form Ijma can take in modern times, will secure contributions to legal discussion from laymen who happen to possess a keen insight into affairs. In this way alone, can we stir into activity the dormant spirit of life in our legal system, and give it an evolutionary outlook. "
We have in this Judgment endeavoured to understand the rationale behind Allah's stern commandment about the prohibition of Riba and made an earnest effort to lay dawn foundation of the Islamic Economic System by eleminating Riba from a facets of our life. If this logic does not satisfy anyone, it should be borne in mind that "Allah alone has the convincing argument" (al‑Qur'an, 6:14) and He alone knows the total rationale.
Before parting with the judgment we deem it our duty to acknowledge the guidance provided and the contribution made by our brother Dr.Mahmmod Ahmed Ghazi till the period that he remained associated as member of the Bench.
We would like to gratefully acknowledge the valuable assistance rendered by the economists, bankers and religious scholars who pursuant to our request appeared before us and shared with us their knowledge and experience. We have immensely benefited from their assistance as is apparent from reading of this judgment. We are also indebted to the hundreds of Pakistanis who by addressing us letters containing their views and by sending their own written works and books and material written by others made valuable contribution in understanding the different questions involved in the case.
(Sd.)
Justice Khalil‑ur‑Rehman Khan, Chairman.
(Sd.)
??????????? Justice Munir A. Sheikh, Member.
JUSTICE WAJIHUDDIN AHMED (MEMBER). ‑‑‑I have had the previlege of going through the scholarly and voluminous judgment, proposed to be delivered by Mr. Justice Khalil‑ur‑Rehman Khan, Chairman of the Shariat Appellate Bench as also the erudite, largely, concurring judgment of my learned brother, Mr. Justice Muhammad Taqi Usmani. If for no other purpose except to provide a commentary on the Herculean efforts, which have gone into the rendering of these judgments, I would, in all humbleness, venture to add a few lines. This may also be taken to be the reason why some aspects have come to be dealt with abruptly and without a prelude. taking it for granted that the subject is neither novel nor new, having already been treated in the said judgments. At the same time only crucial aspects have been ventured to be touched. The rest, by and large, I respectfully endorse. In the rare instances where, with all respect, I have come to entertain any reservations or constraints, such would be discernible either by necessary implication or by express articulation
2.???????? Biaj , Neshec, Sood, interest, usury, or Riba, whatever name be ascribed to an increase',addition', excess' or "gain", accruing on the principal amount loaned, the notion is practically as old as civilization itself. The essence of the transaction has been and remains a fixed or A predetermined, and, thus, predictable, return for the use, of money lent or advanced in a purely time related arrangement. While evidence of such transactions is found reflected, and perhaps not approved except with reservations, in the code of Hammurabi (1792‑1750 BC) of the Babylonian era, the practice was either controlled or consistently disapproved in the religious precepts and teachings of Hinduism (code of Manu), Judaism and
Christianity, on the one hand and the philosophic dissertations of the likes of
Plato and Aristotle, on the other. Aristotle even regarded money as
"barren". The recurrent criticism of the concept was largely rooted in the purported exploitation and consequent misery of one man at the hands of another by merely passing on the use of money in a time related framework with firm or settled and even guaranteed returns thereon without the lender himself doing anything, generating Zulm (exploitation or injustice), in a background where other economic agents (including capital differently deployed) were to exert efforts/expose themselves to risks for seeking gains. Man is weak. To justify the ever multiplying returns on money lent or for forbearance of a debt the otherwise prohibitive dogmas of Judaism and Christianity, pertaining to interest related transactions, over centuries of political, social and economic interaction, came to be softened. Meanwhile, however, Islam, appearing on the scene, had demonstrably re‑modeled theconcept in such a way terming it as Riba (that not merely fixed or predetermined time‑oriented returns on principal sums of money lent were endorsed in their prohibition but the rule was perfected and reiterated according to some) also to include other items, at the minimum, carrying monetary or utilitarian implications. To be specific, the preclusion was extended, as well, to settled or predetermined time‑related returns on the bulk of exchanges. History testifies the prohibition to have been so well?delineated and clearly understood that trade or commercial transactions amongst Muslims, for the best part of the ensuing fourteen hundred years of the Islamic era, have essentially remained free of all taints of interest or Riba. Wherever deviations took place, and those occurred largely at the level of Muslim Rulers, the transgressors had to pay heavily not only in economic but also political terms. In point is the example of the Ottoman
Caliphate, which, in a large measure. owes its disintegration to international debts. No small tribute, however, to the perfection of a Riba or interest‑free economy, continued and generated by Islam, is furnished when the thousands upon thousands of papers, lately compiled and coming to be known as the Janaza documents, dating back to medieval Islamic times, do not contain any mentionable Riba or interest‑bearing transaction.
Having attempted a summary of the historical position, which has emerged upon hearing of these appeals, for the better part of some five months, further analysis of the concept of Riba at the etymological and epistemological levels follows:
"A term in Muslim Law defined as an excess according to a legal standard of measurement or weight, in one or two homogenous articles opposed to each other in a contract of exchange in which such excess is stipulated as an obligatory condition on one of the parties without any return.. The word Riba appears to have the same meaning as the Hebrew 'Neshec', which included gain, whether from the loan of money or goods or property of any kind. In Mosaic Law, conditions of gain for the loan of money or goods were rigorously prohibited."
The quoted definition is also remarkably similar to the succinct description in Abd al‑Rahman al‑Jaziri's famous compilation al‑Fiqh‑ala‑al‑Madhahib al‑Arba'ah, which says:
"Riba is one of those unsound (Fasid) transactions which have been severely prohibited (Nahyan Mughallazan). It literally means increase ....However, in Fiqh terminology, Riba means an increase in one of two homogenous eqdivalents being exchanged without this increase being accompanied by a return. It is classified into two categories. First, Riba al‑Nasia'ah‑‑‑‑‑‑
The second category is Riba al‑Fadl?????.. "
Anyway, either definition draws, directly or indirectly, upon the Qur'an and Sunnah, the first of those, while speaking of Riba and Bai (sale), putting them in juxtaposition with each other and the second, unfolding the notion of Riba al‑Fadl. Each is a happy blending of the thoughts attributed to great thinkers. of the likes of al‑Sarakhsi who, terming Riba, in its literal sense, as "excess" goes on to define it, in its technical (Shari'ah) sense as "the stipulated excess without a counter‑value in Bai", Imam Tabri, who construes Riba as that increase which the owner of a valuable property (Mal) receives from his debtor for giving him time to pay off his debt and Ibne 'Arabi for whom Riba denotes every increase in lieu of which there passes no consideration in the way of property (Mal). Be it mentioned here, albeit in passing, that Bai (sale) in Fiqh (Islamic Jurisprudence) is a word of wide connotations and includes virtually all exchanges, even loans. It is for this reason that upon the (explicit) prohibition of Riba the non‑believers maintained that Bai was also like Riba and the Almighty retorted, "but Allah has permitted (profit on) Bai and prohibited Riba". More of this later.
Speaking strictly, no further augmentation of the FSC references appears to be necessary. However, to provide a self‑contained exposition of the subject and elaborating upon the theme, much like other works, in the Advanced Learner Arabic‑English Dictionary (Pub. 1989, London) the word Riba, as a noun, is stated to be the equivalent of "excess" "addition" or "surplus", its verb denoting "to increase, to multiply, to exceed, to exact more than was due, to practise usury". In "Lisan‑ul‑Arab" to Allama Ibne Manzur Al‑Afriqi, Riba signifies the "excess" or "surplus", which accrues on a loan or the (predictable) profit generated thereon. In his work entitled, Tahzeeb, Abu Mansur‑A1 Azhari similarly describes Riba as the "excess" or the "surplus", which accrues on a loan or the (foreseeable) profit generated by a loanable fund.
Similar results follow when the word Riba is examined, contextually, as found employed in the Qur'an itself. Such is the epistemological dimension, employed to discover and verify the purport and significance of the institution of Riba. In the Qur'an, the word signifies "to rise", "at a height", (II:265;XXIII:50); "to increase", "to prosper", (II:276;XXX:39); "to swell", (XIII:17); "to nurture", "to raise", (XXVI:18; XVII:24); "to grow", (XII:5); and "augmentation" or "increase in power", (XVI:92;LXIX:10). The Federal Shariat Court records, and apparently correctly, that the term Riba, in its various linguistic forms, occurs at about twenty places in the Qur'an.
In short, theoretically, Riba, as a noun, signifies an excess or addition, but never a decrease or depletion, and with reference to a loan an excess payable or an increase chargeable over and above the principal amount or thing borrowed or lent. The quantum bf the addition or premium, large or small, much as the purpose, productive or consumptive, as dilated upon in the exhaustive judgments of my brothers, remains contextually irrelevant. It is in this perspective that the Qur'an disallowed all accruals in the way Riba and permitted, but not without reservations, only returns of the principals then due (al‑Baqarah II:278‑281, hereinafter reproduced), Prophet Muhammad (s.a.a.w.s.), explicity repeating the command in his celebrated sermon on the occasion of Hajjat‑ul‑Wida also reproduced but somewhat later). The broader implication of Riba, is inclusive also of exchanges other than in money, again ordained in the Qur'an and Sunnah, as hinted above, is elsewhere more elaborately reflected.
The Qur'anic prohibition against Riba, in the background of pre?existing restrictions applicable to Ahl‑e‑Kitab (people of the Scripture i.e., Jews and Christians), for "there is no change in religion", (Al‑Qur'an) which, evolutionary processes and man‑made deviations apart, has remained the came since Adam, was gradual, first as pointers and then as the strictest of the commandments. Such, in chronological order, as reflected in the "Blue‑print of Islamic Financial System", based ‑on the report of the International Institute of Islamic Economics (IIIE), placed on the record by Dr. Sayyid Tahir, Director‑General, IIIE, International Islamic University, Islamabad, are these:
1st Revelation (5 Years before Hijrah)
Caution was addressed to the believers to the effect that Riba remained an anathema as heretobefore:
"That which ye lay out in usury in order that it may increase on (other) people's wealth hath no increase with Allah: but that which ye give in charity, seeking Allah's pleasure, hath increase manifold". (al‑Room XXX:39).
2nd Revelation (Early Madni Period around 2 A.H.)
Historically, in the beginning, in response to provocations of the Jews, Allah (s.w.t.) recounted their major sins that invited his wrath upon them. However, as in most other cases, these Ayaat indirectly served the purpose of bringing the does and don't to the notice of Muslims:
"Because of the inequity (repression) of the Jews. We forbade them for good; and wholesome which were (before) made lawful unto them, in that they hindered many from Allah's way: 160
And of their taking usury when they were forbidden it, and of their devouring men's substance wrongfully;‑‑‑We have prepared for those of them who disbelieve a painful doom: 161.
But those among them who are firm in knowledge and the believers (who) believe in that which is revealed unto thee, and that which was revealed before thee, especially the diligent in prayer and those who pay the poor‑due, the believers in Allah and the Last Day: to them shall We surely give a great reward." 162
(al‑Nisa IV: 160‑‑‑162).
Pertinently, with the advent of Jesus (p.b.u.h.) the divine favours were restored, thus:
"And He will teach him (Jesus) the Book and wisdom, and the. Torah and the Gospel: 48
"And will make him a messenger unto the children of Israel, (he, when descended, saying): Lo! I come unto you with a sign from your Lord. Lo! I fashion for you out of clay the likeness of a bird, and I breathe into it and it is a bird, by Allah's leave. I heal him who was born blind, and the leper, and I raise the dead, by Allah's leave. And I announce unto you what ye have eaten and what lies stored in your houses. Lo!. Herein verily is a portent for you, if ye did believe: 49
"And (I come) confirming that which was before me of the Torah, and to make lawful some of that which was forbidden unto you. I come unto you with a sign from your Lord, so keep your duty to Allah and obey me." 50
(Aal‑e‑Imran 111:48 ‑‑‑ 50).
3rd Revelation (Shawwal 3 AH, after the Ghazwah of Ohud)
Riba was prohibited, in express terms, for the Muslims on this occasion.
"O ye who believe! Devour not usury, doubling and quadrupling. Observe' your duty to Allah, that ye may prosper: 130
And ward off (from yourselves) the Fire prepared for disbelievers: 131
And obey Allah and the Apostle, that ye may find mercy: 132
And one with another for forgiveness from your Lord, and for a Paradise as wide as are the heavens and the earth, prepared for the righteous: 133
Those who spend (in alms) alike in ease and in adversity, those who control their wrath and are forgiving toward mankind; Allah loveth the good: 134
And those who, when they do an evil thing or wrong their (own) selves, remember Allah and implore forgiveness for their sins‑‑?Who forgiveth sins save Allah only?‑‑‑and will not knowingly repeat (the wrong) they did: 135
The reward of such will be forgiveness from their Lord, and Gardens underneath which rivers flow, wherein they will abide for ever‑‑‑a bountiful reward for those who act (righteously)!" 136
(Aal‑e‑Imran III:, 130 ‑‑‑ 136).
4th Revelation (Shorter after Aale Imran III:130‑136)
Adversaries of Islam called into question the preceding decree in Aal‑e?Imran 111:130 by drawing parallel between profit (in trading) and Riba. Moreover, while application of the decree to fresh transactions was obvious, some of the companions of the Prophet (s.a.a.w.s.) were not clear about handling the then existing Riba‑based debts and the Riba already appropriated. These issues came to be addressed in the following Ayaat:
"Those who swallow usury cannot rise up‑save as he ariseth whom the devil hath prostrated by (his) touch. That is because they say: Trade is just like usury; whereas Allah permitteth trading and forbiddeth usury. He unto whom an admonition from his Lord cometh and (he) refraineth (in obedience thereto), he shall keep (the profits of) that which is past, and his affair (henceforth) is with? Allah hath blighted usury and made alms‑giving fruitful. Allah loveth not the impious and guilty: 276
Lo! Those who believe and do good works and establish worship and pay the poor‑due, their reward is with their Lord and there shall no fear come upon them neither shall they grieve. " 277
(al‑Baqarah II: 275‑‑‑277).
5th Revelation 9 or 10 AH before Hu"at‑ul‑Widaa'‑‑‑The Farewell Pilgrimage)
Two newly Muslim .families, one from Makkah and the other from the tribe of Thaqeef, reportedly, quarrelled over a Ribawi debt contracted before they embraced Islam. The creditors sought exception to the Ahkam in force at the time or, perhaps, immediate settlement of accounts. The matter came to be settled by Allah (s.w.t.) as follows:‑‑‑
"O ye who believe! Observe your duty to Allah, and give up what remaineth (due to you) from usury, if ye are (in truth) believers. 278
And if ye do not, then be warned of war (against you) from Allah and His messenger. And if ye repent then ye have your principal without interest). Wrong not and ye shall not be wronged 279
And if the debtor is in straitened circumstances, then (let there be) postponement to (the time of) ease; and that if ye remit it (the capital) as charity such would be better for you if ye did not know: 280
And guard yourselves against the Day when ye shall be brought back to Allah. Then shall every soul be paid in full that which it earned, and none shall be wronged." 281
(Al‑Baqarah II: 278‑‑‑281).
Compare here the following from the New Testament:
"If you love only the people who love you, why should you receive a blessing? Even sinners love those who love them"! 32
"And if you do good only to those who do good to you, why should you receive a blessing? Even sinners do that!" 33
"And if you lend only to those from whom you hope to get it back, why should you receive a blessing? Even sinners lend to sinners, to get back the same amount! 34
"No! Love your enemies and do good to them; lend and expect nothing back. You will then have a great reward, and you will be sons of the Most High God. For he is good to the ungrateful and the wicked." 35
"Be merciful just as your Father is merciful". 36
(Luke 6:32‑‑36).
Narration is from Abu Hurayrah: The Prophet (s.a.a.w.s.) said:
"There will certainly come a time for mankind when every one will take Riba and if he does not do so, its dust will reach him". (Abu Daud).
Having said as much, the Qur'anic verses on Riba are still singularly explicit as to the deducible meanings, implications and ingredients of Riba, on the one hand and the level or extent of the prohibition thereof, on the other. In the result, as seen, a clear distinction is crafted between the principals lent and the accruals thereon, the first alone being recoverable, recovery being tampered with grace and conversion into Sadaqah, or charity, still better: (Al‑Baqarah II: 275, 279 and 280) and the second prohibited in the strongest of terms, the equal of which is no where to be found even in the Qur'an:
"If ye do not, take notice of war from Allah and His Apostle: but if ye turn back, ye shall have your capitals: deals not unjustly and ye shall not be dealt with unjustly."
(al Baqarah II: 279).
Yet, productivity of capital is recognized though only when it is employed in trade, commerce, industry or any other fruitful activity, with varying and uncertain (including negative) returns to the investor. Still, mere variability or unpredictability of gains or even risks in an undertaking would not suffice; the pursuit must be lawful, for one of the most pronounced uncertainties (Gharar), is in gambling (Qimar), which itself is prohibited. The essence of the Nasus, against Riba, lies in a denunciation of hoarding and drawing gains from idle capital with reference to its holder for the time being, because, notionally, all things in Islam belong to Allah and man is only entrusted with the transitory use thereof, an incident, which led Muslims, over the centuries, to dedicate their tangible assets to Allah by way of Waqf (Trust), reserving, at the maximum, a life interest, in whole or in part, for personal use or use of their progenies. Indeed the prohibition is a manifestation, inter alia, of two other Qur'anic mandates namely, a recommendation to expend, towards good and charitable causes, all the excess that there be in the way of wealth, after having catered to one's (short or long term) requirements:
"They ask thee (O Muhammad) how much they are to spend (in the way of Allah); say:
"What is beyond your needs" (11:219)
and an emphasis on creative activity culminating in the declaration;
"For man there is only that to achieve which he labours"
(XXXIX:53).
"Such (the affliction already noted) would befall them because of their saying that (profit on) Bai' or trading is the same as Riba, but Allah has permitted Bai' and prohibited Riba."
(Al Baqrah II: 275).
"It is on the authority of Abu Saeed Dkudri (r. a. a.) that the Prophet (s.a.a.w.s.) said: 'Don't trade gold for gold or silver for silver except on the basis of Waznamm‑bi‑ivazn (weight), Mithlamm‑bi?mithl like for like) and Sawa'amm‑bi‑sawaa' (equal for equal).'
(Muslim, 2966).
It is on the authority of Abu Saeed Khudri (r.a.a.) who reported that the Prophet (s.a.a.w.s.) said: "While exchanging gold for gold, silver for silver, wheat for wheat, barley for barley, dates for dates and salt for salt, do so on Mithlamm‑bi‑mithl (like for like) and Yadamm‑bi‑yad (hand to hand or on spot) basis. Thus, whosoever gave more or demanded more, verily he dealt in Riba. Both the taker and the giver are equal i.e., equally guilty‑‑‑in this regard."
(Muslim, 2971).
Obadah b. Samett (r.a.a.) directly reports the Prophet (s.a.a.w:s.)' as saying: "Buy and sell gold for gold, silver for silver, dates for dates, wheat for wheat, salt for salt and barley for barley on the Mithlamm‑bi‑mithl (like for like) basis. Whosoever gave more or took more, verily he made a Riba deal. However, trade gold for silver as you wish subject to the condition that the exchange be Yadamm‑bi‑yadd (on spot). Trade wheat for dates or barley for dates also likewise." (Tirmizee, 1161).
Question immediately arises as to whether the admonition, administered in the Ahadith, was confined only to the six articles described or such articles were a genus, from which a principle emerged. Most jurists agreed that the six items, mentioned, were only illustrative but some said the articles referred to qualities of weighability or measurability and all that satisfied the requirements was and is covered but others identified monetary value or storeability/edibility as the criteria to determine the applicability of the rule. The leading exponent of the first of these constructions is Imam Abu Hanifa (r.a.a.) whereas the second is attributed to those subscribing to the thinking of Imams Malik (r.a.a.) and ShafeY(r.a.a.), the former apparently broadening the category to which Riba al‑Fadl would extend while the latter, not unreasonably, constricting it. M. Umer Chapra in his treatise, "Towards a Just Monetary System" is explicit as well as incisive when he disserts upon the parameters of Riba al‑Fadl, thus:
"On the basis of the characteristic of gold and silver as commodity money, it has been generally concluded that all commodities used as money enter the sweep of Riba al‑Fadl. With respect to the other four items, there is a difference of opinion. One opinion argues that since all four commodities are sold by weight or measure (Hanafi, Hanbali, Imami and Zaydi), therefore, all items which are so saleable would be subject to Riba al‑Fadl. A second opinion is that since all four items are edible, Riba al‑Fadl would be involved in all commodities which have the characteristic of edibility Shafi'i and Hanbali). A third opinion is that since these items are necessary for subsistence and are storeable (without being spoilt), therefore, all items that sustain life and are storeable are subject to Riba al‑ Fadl (Maliki). The Zahiri school, however, confines Riba al‑Fadl to only the six commodities specifically mentioned by the Prophet. It is, however, the only school, and minority, to be so restrictive. A fourth, but perhaps a more plausible, explanation is that all the six commodities were used as money in and around Madinah, particularly among the bedouins, and, therefore, Riba al‑Fadl would be involved in the exchange of any goods against cash or any commodity which is used as money."
Without being unduly partial to any of the foregoing interpretations, we have, for this discourse, used those versions almost interchangeably. Relative to the diversity itself, however, one view projected before us is that the eminent jurists were really identifying the multifarious dimensions of the same thing, much as the on‑lookers of a structure, from different angles, may be prone to do. Indeed, as above indicated, an excellent amalgam of such varying expositions is to be found in the definition of the generic term Riba itself, rendered by Abdur Rehman al Jaziri, who declares:
"????in Fiqh terminology, Riba means an increase in one of two homogeneous equivalents being exchanged without such increase being accompanied by a return."
Be that as it may, while the added guidelines as to all increases, also in exchanges of a large variety of chattel, but distinguished from the legal tender as such, remain operative with full force, the argument itself, some hold, is no longer as crucial as in the days of barter. However, all that, it, in essence, has signified in the past and signifies now is a redoubled emphasis on an embargo against unearned excess on identical articles exchanged, on the one hand and a like increase in deferred exchanges of dissimilar goods, on the other. What, therefore, emerges from the foregoing Ahadith is a preclusion to take anything in excess while exchanging gold for gold, silver for silver and so on (i.e., similar) or to conclude any such transaction except as a hand to hand transfer. The rule, however, alters .where gold is exchanged for silver or silver for dates or dates for wheat and so on (i.e., dissimilar), the rate of exchange instantaneously becoming discretionary, whilst the ready nature of the contract still holding. Because all the six items named in the Ahadith represented commodity money of the time, an obvious incident of the rule is ?targeting the time honoured exchanges inter se between local and external currencies, which, though, on ready or hand to hand basis, may freely be transacted, according to market forces, yet any forward trading therein would immediately attract the sanction underlying the doctrine of Riba al‑Fadl. This aspect of Riba has always featured as a bulwark against uncertainty or Gharar, as inclusive of speculation, emerging as a notable contributory to a just social order. Significance here, some say, also lies in things of value or of fundamental utility not being countenanced to suffer artificial scarcity on account of exposure for being loaned away or hoarded. As distinguished from this, however, Bai' Mu'ajjal (sale against deferred payment) is clearly made permissible since, added to the foregoing, in all probability, the Prophet (s.a.a.w.s.) desired to encourage monetary transactions (even upon deferral) as against barter, the latter of which had the potential of degenerating into Riba. Another dimension of Riba al‑Fadl may have subsisted in an intendment to forestall unwary citizens being taken in by sharp traders, the stipulated safeguard for exchange of similar goods being, like for like, weight for weight, measure for measure and hand to hand. The institution of Riba al‑Fadl, therefore, has not been rendered toothless muchless having become a dead letter in economic terms by passage of time. Few seem to have noticed the Prophetic wisdom in reading Riba al‑Fadl within the ambit of the Qur'anic prohibition yet that emerges as an unmistakable symbol against all unearned increases in the way of anything having the semblance of Riba. But for the preclusion of Riba al‑Fadl and, by that token, broadly of all increases, while, bartering in similars or delving in futures, the ignorant or the motivated would, possibly, have succeeded in sheltering later day deviations, whereby the generalised Qur'anic concept of Riba could stand restricted only to non‑productive, patently oppressive and purely un?conscionable fixed returns on advances, thus, recklessly, neutralizing a basic economic expedient, so necessary for a welfare society.
I tend to disagree here with the observation of the Federal Shariat Court that Riba al‑Fadl, in the context of lawfulness or otherwise of interest or usury in Islam, did not concern the Court. Having already dilated upon the continuing efficacy of Riba al‑Fadl, down to our own times, I would only broadly state my reasons for disagreeing with such stance of the Federal Shariat Court: Firstly, it was Riba, in all and sundry manifestations thereof, which had come up for appraisal before the FSC and, therefore, the FSC had little choice of drawing a distination in the matter. Significantly, there is little warrant for later day's jurists in equating Riba al‑Nasi'ah with the generic term Riba, employed in the Qur'an, questionably terming that alone as Riba al‑Qur'an on the ground that only Riba al‑Nasi'ah was previously known to the Arabs whereas Riba al‑Fadl was introduced by the Prophet (s.a.a.w.s.). In the first place, the assertion is factually incorrect since it is empirically established that the Arabs. used to exchange inferior quality commodities for superior ones of the same kind, e.g., one Saa' of good quality dates for two Saa' of the inferior ones or bartered in heterogeneous items e.g., barley for wheat etc. Additionally, this is to deny the Qur'an and Sunnah as inseparable and the latter as a live commentary of the former. While the Qur'an is the revealed message for all times and all peoples, the Prophet (s.a.a.w.s.) provided the details of things already ordained therein, the juristic difference in the Qur'an and Sunnah being that the first was the inspired message from the Almighty alongwith its revealed phraseology whereas the, latter was likewise inspired but in words chosen by the Prophet (s.a.a.w.s.) himself. Whenever and wherever, therefore, one is called upon to interpret Qur'anic doctrines one must advert to the Ahadith (words, deeds and even meaningful silence) of the Prophet (s.a.a.w.s.) more as elaborative of something, which is complete rather than innovative in regard to something, which needs to be complemented or perfected. Thus, the Prophet (s.a.a.w.s.) indiscriminately dilated upon Riba al‑Nasi'ah and Riba al‑Fadl, never distinguishing between their consequences and none of the early doctors identified Riba al‑Nasi'ah as the sole equivalent of Riba in the Qur'an. Such, apparently, inadvertent references started with Ibn Rushed, a Spanish jurist and continued with Imam Razi, as aptly identified in "The Concept of Riba and Islamic Banking" by Imran Ahsan Khan Niazi. The Qur'an, accordingly, uses the term Riba in the broadest of senses so as to encompass all its forms, then known and practised, as also such as may thereafter evolve. Interpreting the Qur'an is, to cite an inferior example, like interpreting a written constitution, commensurate with a requirement to meet all conceivable exigencies of time, space and the like. Secondly, during the lifetime of the law‑giver, the Sharae, there was no currency, as such, of the Muslim State and the function of legal tender had largely devolved on the Persian and Roman currencies. This was besides barter, which also was substantially in vogue. Hence, inter alia, as above‑hinted, the apparent necessity of including common items of barter, so as to preclude Riba enveloping barter deals. Misgivings, genuine or otherwise, on this score were not unlikely because barter also constituted Bai (trade) and bai was freely permissible whereas only Riba was, literally, prohibited. The prohibition in the way of Riba al‑Fadl was, therefore, a direct consequence of Bai, in contradistinction to Riba, having explicity been approved in the Qur'an. Approaching the matter from this angle, the object of deducing Riba al‑Fadl from the Qur'anic concept of Riba (for, as said, I am not inclined to think that Riba al‑Fadl was either supplemental or complemental to what was ordained or was an innovation of the Shariah) may also have been to preclude Ribawi contracts being introduced through the back‑door of barter deals. Efficacy of the caution can immediately be seen when it is realised that such circumvention is practised even now, e.g., trading in futures when trade through barter, in effect, stands forsaken. However, so great was the impact of the Qur'anic prohibition of Riba and its al‑Fadl aspect that at the advent of Islam, well‑into the days of Caliph Omer and much after, the followers would not pay or take anything in excess of the gold or silver contents in the purchase of gold or silver artifacts in lieu of Dinars (gold coins) or Dirhams (silver coins) respectively even though (possibly) manufacturing costs thereof could warrant for more. All this, as reflected below, far fear of involuntarily transgressing the Qur'anic commandment:
"This narration is from Abu Qelabah. He told that he was sitting in Syria in a circle that also included Muslim bin Yasaar. There came Abul Ash'ath. According to Abu Qelabah, everybody exclaimed: "Abul Ash'ath! Abul Ash'ath!" Abul Ash'ath joined the circle. Abu Qelabah asked him to narrate the Hadith of Obadah B. Samett (r.a.a.) for a brother there. Abul Ash'ath agreed. His narration is as follows:
We (i.e., Abul Ash'ath and his collqagues) were on a military mission under the command of Mo'aawiyah. We gained a lot of spoils of war. Among them, there was a silver utensil. Mo'aawiyah directed a person to auction it against the salary due in favour of the soldiers. People showed great interest in the auction. When the news reached Obadah bin Samett, he stood up and said: "I heard the Prophet (s.a.a.w.s.) forbidding the sale of gold for gold, silver for silver, wheat for wheat, barley for barley, dates for dates and salt for salt except on Sawa'amm‑bi‑sawaa' (equal) and Ainamm‑bi? aim (like for like) basis. The Prophet (s.a.a.w.s.) further said that if someone gave more or took more, he entered into Riba". As soon as the people heard this, they withdrew from the auction. When the news reached Mo'aawiyah, he got, up and addressed the people as follows: "What is the matter with the people that they attribute to the Prophet (s.a.a.w.s.) the Ahadith that we did not hear even though we also saw the Prophet (s.a.a.w.s.) and kept his company?" Obadah stood up and repeated the whole thing. He then angrily said: "We will narrate what we heard from the Prophet (s.a.a.w.s.) even though it might be unpleasant for Mo'aawiyah (or, he said: even if it is against the will of Mo'aawiyah)." Obadah further said: "I don't care even if it (i.e., contradicting Mo'aawiyah) costs me my stay with Mo'aawiyah's army on this very dark night."
According to Abu Qelabah, Hammad told the above or something more or less like it.‑‑‑‑The compiler of the source book for this Hadith further states that he also heard it from Ishaq B. Ibrahim and Ibne Abi Omar both of whom narrated it on the authority of Abd al?Wahab Thaqfi who, in turn, reported Ayub. At Ayub, the chain of narrators becomes the same as that for this Hadith.
(Muslim, 2969).
The tradition, just quoted, signifies, in the first place, that the transaction in question offended the rule that all exchanges, whether of gold for silver or of wheat for dates or of barley for wheat and the like (i.e., in dissimilars), even though they may not be Mithlamm‑bi‑mithl (like for like) and Waznamm‑bi‑waznlsawa'amm‑bi‑sawaa' (equal in weight/measure), had still to follow the other rule of Yadamm‑bi‑yad (hand to hand or on the spot). This arose because the auction price of the utensil under reference was to be paid the salary of men, which till then still remained to be disbursed and in exchanges, upon deferment (delivery and/or payment), one is prone to agree to give more than strictly justified, partaking an element of Riba. In such context, the objection was and remains valid. Secondly, the other condition of like for like together with equality in weight/measure, may also have had the prospect of being infringed because the troops were paid salary in silver coins and the auction may have produced an unequal exchange between the silver content of the utensil and that in the Dirhams (silver coins). There is only one aspect, however, in relation to which the caveat may (perhaps) have evoked some reservations and that consisted in the fact that the utensil, put to auction, also carried fabricating costs for which an added consideration may have been required. According to some reports because manufacturing costs of gold and silver utensils, as possibly distinguished from ornaments of those metals, were inadmissible, the reason being a prohibition against the use of precious metals in eating/drinking articles) this ground as well was not recognized by Caliph Umer, when the matter was brought to his notice. Even so, the first two objections, indisputably, remain valid and as to the third, touching ready but lawful transactions, jurists have found an answer, based on another Hadees of the Prophet (s.a.a.w.s.) namely, that the difference in cost or quality may be made up by an express stipulation in the price paid (in dinars, of gold, in this case because the urn was of silver, as distinct from a like for like exchange), thereby encouraging Bai' in preference to barter and ensuring that Riba did not sneak into commercial transactions through one artifice or another. Such Hadees runs thus:
"This Hadith is from Yahya. He said that he heard it from Oqbain b. Abdul Ghafer who, in turn, heard it from Abu Saeed Khudri (r.a.a.). Abu Saeed Khudri said that once Bilal (r.a.a.) brought to the Prophet (s.a.a.w.s.) some burney (good quality) dates. The Prophet (s.a.a.w.s.) inquired as to where 'he got those dates from. Bilal replied: "We had some radl (inferior) dates. I sold two Saa' (measure of volume) of them for one Saa' of burney dates in order to give them to the Prophet (s.a.a.w.s.) to eat.' Upon hearing this, the Prophet (s.a.a.w.s.) exclaimed: `Oh no! That is Riba. That is exactly Riba Don't do that again. If you want to buy (good) dates for (inferior) dates next time, first sell your dates, and then buy the new ones with the sale proceeds'." (Bukhari, 2145).
Lastly, the objective considerations for the institution of Riba al‑Fadl are of such an overriding nature that without its continued prohibition a Riba‑free economic system cannot possibly be conceived. The concept was designed, essentially, to foster justice in trade and commerce, as aptly described by M. Umer Chapra:
"The prohibition of Riba al‑Fadl is, thus, intended to ensure justice and remove all forms of exploitation through unfair' exchanges and to close all back‑doors to Riba because, in the Islamic Shari'ah, anything that serves as a means to the unlawful is also unlawful. The Holy Prophet (peace be upon him) equated with Riba even the cheating of an unsophisticated entrant into the market and the rigging of prices in an auction with the help of agents (Ahadith C.9 and C.10) implying thereby that the extra money earned through such exploitation and deception is nothing else but Riba‑al‑Fadl. Since people may be exploited or cheated in several different ways, the Prophet warned that a Muslim could indulge in Riba in a number of ways (Hadith A.5). This is the reason why the
Prophet, (peace be upon him); said:Leave what creates doubt in your mind in favour of what does not create doubt', and Caliph Umar was inspired to say:Abstain not only from Riba but also from Ribah' (Hadith C.1). Ribah is from rayb which literally means 'doubt' or `suspit'?lon' and refers to income which has the semblance of Riba or which raises doubts in the mind about its rightfulness. It covers all income derived from injustice to, or exploitation of others.
Thus, Riba al‑Nasi'ah and Riba al'Fadl are both essential counterparts of the verse "God has allowed trade and prohibited Riba (2:275). While Riba al‑Nasi'ah relates to loans and is prohibited in the second part of the verse, Riba al‑Fadl relates to trade and is implied in the first part. Because trade is allowed in principle, it does not mean that everything is allowed in trade. Since the injustice inflicted through Riba may also be perpetuated through business transactions, Riba al‑Fadl refers to all such injustices or exploitations. It requires absence of rigging, uncertainty or speculation, and monopoly or monopsomy. It demands a fair knowledge of the prevailing prices on the part of both the buyer and the seller. It necessitates the elimination of cheating in prices or quality, and in measurements or weights. All business practices which lead to the exploitation of the buyer or the seller or to a restriction of fair. competition must be effectively prohibited. "
"The last of what was revealed was the verse on Riba and the messenger of Allah departed before he could elaborate upon it. So give up Riba together with all doubt. "
It has been argued before us that one of the narrators of this Ahadis, Saeed bin Al‑Musaib, suffering from confusion and a faulty memory, is weak and untrustworthy. That apart, as urged by Hafiz Abdur Rehman Madani, Director, Institute of Higher Studies (Shariah and Qada), there are at least two Ahadis, one from Abu Huraira (r.a.a.) etc., regarding the Prophet's (s.a.a.w.s.) appointee at Khyber, who presented high quality dates to the Prophet (s.a.a.w.s.) and upon the latter's query disclosed that he had exchanged a large quantity of inferior dates with a smaller return in superior ones, meeting a similar response as Bilal (r.a.a.), above‑quoted and the other from Fuzaila bin Ubaid, who, on the day of Khyber, had purchased a gold necklace (apparently, otherwise than ‑for its user as an ornament, for, if that were the case, there should have been no occasion to break it up) for 12 Dinars (gold coins) which, when dismantled, produced a large gold content than in the Dinars, also meeting the disapproval of the Prophet (s.a.a.w.s.), who observed that this was nothing but Riba and required that such transactions, of like for like, may be concluded upon opening up of the contents, each of the Ahadis suggesting that Riba al‑Fadl was in the prohibition at least as early as the battle of Khyb6t (7 A.H.) and negating the plea that the advent of Riba al‑Fadl was close to the end of the Prophet's wordly life or even that the Qur'anic doctrine of Riba, in its multi?dimensional facets, was perfected only that late in the day for, if Riba al?Fadl was identified around Khyber, the broader prohibition should, arguably, have preceded that. According to Riazul Hasan Gilani, learned counsel for the Federation, similar conclusions are, inter alia, shared by Allama Muhammad Hussain Taba Tabai, Ibne Majah, Allama Shibli Naumani and Suleman Mansoorpuri. Indeed, the imputed report from Hazrat Umar (r.a.a.), is also contradicted directly by another quote from the second Caliph himself, where he is reported to have said:
"You think that we are unacquainted with some forms of Raba. By God, knowledge of such forms, in my view, is even dearer than Egypt and its districts. Then, of Ribawi dealings, some are not hidden from any‑one, such as forward purchase of gold for silver or purchase of fruit while still on trees and not yet ripe and Bai Salam concerning animals." (Al‑Musanif Abdur Razzaq, Vol.8, p.26, Hadees 14161). .
The above is a complete answer that the Companies did not fully comprehend Riba al‑Fadl, the Prophet (s.a.a.w.s.) having, purportedly, departed before he could expand upon the same. All that seems to have been their refrain consisted of the fact that Riba was prone to taking ever changing forms, some of which may not have readily been encountered. Even so, the quoted passage makes it clear that the concept of Riba was fully understood and appreciated by the interlocutor. In so far as the Qur'anic revelations, touching Riba, are concerned, it is further obvious that the final word must have descended before the sermon of Hajjat‑tul Wida (the last or farewell pilgrimage, below quoted) because such emphatic renunciation, as in that sermon, could not have come about without that having already been accomplished. I have already quoted the likely dates of the various revelations on the subject but, analysed as above, the last one should have been if not closer to Khyber at last around the time of the bloodless entry to Makkah (8 A.H.) and, therefore, substantially prior to the sermon. For more of this see the main judgment, where the time sequence is extensively dilated upon. Reverting those, who succumb to the caveats, hinged on the quoted alleged???? lament of the Caliph, remain unmindful of the Almighty's declaration, near the end of the Prophet's (s.a.a.w.s.) wordly sojourn; "Today, I (Allah) have completed for you your deen (faith), perfected My blessings and chosen Islam as the deen for you," an intimation which instantly made the followers apprehensive that the Prophet's (s.a.a.w.s.) days, thenceforth, were numbered, his assignment having been completed. Correspondingly, they remain oblivious, also, to the simple logic that, if the Prophet (s.a.a.w.s.) had descended with a message and mission, he could not have left without accomplishing it, including duly clarifying the fundamental of Riba. Thus, and even though the alleged protestation of Caliph Umar may have been quoted by some jurists of note that fact, in itself, is not enough to lend authenticity thereto. Indeed the adversaries had, even during the days of the first two Caliphs, become active in fabricating false Ahadees and one of the most effective methods of fraudulent coinage of sayings, facts or events is to mix, ex facie, commendable portions with falsely invented ones, such as saying that the concept of Riba could not be explained, because of the Prophet's (s.a.a.w.s.) being taken away, and that the best course was not only to give up Riba but also al‑reebia (doubt), meaning everything having the semblance of it. Assuming, however, that the Prophet, in fact, did not have time to fully elaborate upon all Shari'ah forms of Riba, even though he did not depart for 81 days after the Hajjat‑ul‑Wida and no serious commentator doubts that the last revelation had already come at least at that juncture, Dr. M. Umer Chapra clinches the issue, when he counters the outcome, thus:‑‑?
"However, this (Prophet's elaboration) was not necessary. The whole Qur'an and his Sunnah are there to help the Ummah do so. This the ongoing challenge to all Muslims‑to examine their economic practices continually in the light of Islamic teachings and to eliminate all shades of injustice. This is a more difficult task than eliminating Riba al‑nasi'ah. It requires a total commitment, an overall restructuring of the entire economy within the Islamic framework to ensure justice. This was, and is, the unique contribution of Islam. While Riba al‑nasi'ah was well‑known in the Jahiliyyah (pre‑Islam period) the concept of Riba al‑Fadl was introduced by Islam and reflected the stamp of its own unflinching emphasis on socio‑economic justice."
"Anas Ibn Malik reports: The Prophet (s.a.a.w.s:) said: `When one of you grants a loan and the borrower offers him a dish, he should not accept it; and if the borrower offers a ride on an animal, he should not ride, unless the two of them have been previously accustomed to exchanging such favours mutually."
(Kitab al Buyun).
If, therefore, any such favour, as above, is ascribed to the Prophet (s.a.a.w.s.) that may directly be relatable to his generally gracious conduct (customarily disposed towards Ahsan i.e., conferment of favours), always being at the giving and never at the receiving end. The foregoing Ahadees is also a pointer that, as a rule, no mala fide accretion on a loan, howsoever small, is admissible. To this neither any Government nor a State is an exception. In fact, to allow any leeway on the point, subject to the Ahadees above‑quoted, would serve little purpose other than to allow entry to Riba through a back door.
"25. If thou lend money to any of My people that is poor by thee, thou shalt not be to him as an usprer, neither shalt thou lay upon him usury.
If thou at all take thy neighbour's raiment to pledge, thou shalt deliver it unto him by that the sun goeth down.
For that is his covering only, it is his raiment for his skin: wherein shall he sleep? And it shall come to pass, when he cricth unto Me, that I will hear; for I am gracious."
Much the same is enjoined in LEVITICUS 25:35‑‑38:
"35. `And if your brother becomes poor and cannot maintain himself with you, you shall maint4in him; as a stranger and a sojourner he shall live with you. 36. Take no interest from him or increase, but fear your God; that your brother may live beside you. 37. You shall not lend him your money at interest, nor give him your food for profit. 38. I am the Lord your God, who brought you forth out of the‑ land of Egypt to give you the land of Canaan, and to be your God."
The edict, however, seems to have been relaxed for strangers (non?believers) when the Old Testament (Deuteronomy 23: .19‑20) provided thus:
" 19. Thou shalt not lend upon usury to thy brother; usury of money, usury of victuals, usury of anything that is lent upon usury.
At the time, there does not appear to have been any distinction between interest and usury and the concept was uniformly covered by the Hebrew word Neshe, which meant gain, arising from a loan, whether in money or in kind. The later day Jewish practice of trading and even monopolizing in usury or interest‑bearing transactions, ostensibly and historically, owes a great deals to the Jews being discriminated against in the matter of employments and other lawful callings. Money‑lending business, therefore, seems to have been found as an escape route by that down‑trodden community in the then Western society. On the other hand, such Jewish pursuits, of the time, came extremely handy to the autocratic rulers, holding sway in Christendom, whose Christian subjects were precluded from obligingly catering to their financial needs. Read here autocratic Muslim rulers and their Muslim subjects, as a later day addition if not substitution. Co‑relate the declaration: "No Christi4n is an usurer 1551" (Shorter Oxford Dictionary, Vo1.II, p.2326, 3rd Edn.)‑the condemnation of Gibbon: "The usurer, who derived from the interest of money a silent and ignominious profit" and the criticism of Ruskin, "I know myself to be an usurer as long as I take interest on any money".
Specific to the Christian thought on usury, interest or Riba, the doctrine does not seem to have been explicitly related to Jesus (s.a.a.w.s.) but was evolved, partly, upon some direct reflections attributed to him and, generally, on the basis of his life and teachings, taking firm root in the philosophy and thinking of the Church and the mediaeval scholastics (9th to 14th Centuries), known as the Schoolmen. In point, ascribed to the Messiah (New Testament, Luke 6:35), is the observation, "No! Love your enemies and do good to them; lend and expect nothing back". (Compare the Qur'anic exhortation), "If the debtor be in difficulty, grant him time till it is easy for him to repay. But if ye remit it by way of charity, that is best for you if ye only knew". (Al‑Baqarah II: 279). In turn, Popes and Councils alike consistently decried all kinds of payments for the use of money lent, since, to them, money had little purpose other than as a medium of exchange and its principal use lay in consumption, whereby it was .sunk in exchange. Augustine placed usury in the category of crime and denounced usurers as a breed of vipers that gnaw the womb that bears them. (See the hadith, which goes):
"Jamil bin Daraj reports Imam Jafai Sadiq (r.a.a.), saying:
In the sight of Allah the sin of one Dirham of Riba is greater than the sin of incest. If that sin is divided into seventy parts, the sin of the lightest part would equal the sin as of one, gone into his mother within the Ka'ba". (Al Burhan by Bahrani; a similar version also in Baihiqi).
The early Fathers totally disapproved usury, as inclusive of later day interest. A canon of the Third Lateran Council (1179 A.C.) directed that manifest usurers shall not be admitted to Communion nor, if they die in their sin, shall receive Christian burial. (A priori, refer the Ahadees of the Prophet (s.a.a.w.s.), where he is reported to have declined to lead the funeral prayers of a Muslim, who had died in a state of indebtedness and the successors to the estate left the debt unrequited. Islam, in theory and practice, discourages even contracting of loans what to say of indulging in Riba). Pope Clement V made the prohibition of usury absolute and declared all legislations, even remotely, countenancing usury as void (1311 A.C.). To elaborate, in Christendom interest, in its pristine form, denoted "money paid for the use of money lent the principal) or for forbearance of a debt, according to a fixed ratio (rate per cent.) 1545". (Shorter Oxford Dictionary, Vol.l, p.1026, 3rd Edn.) Correspondingly, "the crime of usury, before the Reformation, consisted in taking of any interest for the use of money; and now in taking any higher rate of interest than is authorised by law 1754". Subsequently, the statutes ‑against usury were repealed (in Britain) so that one may take for one's money whatever amount of interest one can get: (ibid). Vol.II, p.2326. Correspondingly, Encyclopaedia Americana (1970) records:‑‑‑
"Interest is a charge for the use of money‑‑‑‑Interest has not always been considered a legitimate or even moral payment. Until the end of middle ages, any charge for a loan was generally considered to be usury. The teachings of Christian, Judaic and Islamic religions, all condemned in varying degrees, the taking of interest. In recent times, however, usury has come to be regarded as only the charging of illegal rates of interest‑‑‑‑‑"
It, thus, becomes plain that, in the context of Judaism as well as Christianity, there initially was no distinction between interest and usury, the last being a derivative of the Latin words usus, uti, meaning "to use" and signifying "the fact or practice of lending money at interest", as also, "the premium or interest on money (or goods) lent". Only in its later day adaptation did "usury" denote "the practice of charging excessive or illegal rates of interest for money on loan". It was riot until 1830 that the holy Office allowed interest to be lawfully taken for money lent to merchants, who engaged in profitable trades.
Because Islam was revealed at a time when society did not recognize any difference between interest and usury, each denoting an excess, whether large or small, over and above the principal advanced and because the word usury, from the beginning, has, commonly, been used in translations of the earlier Scriptures the same word has been preferred in the translated versions of the Qur'an, herein cited. Accordingly, for the purposes of this discourse, usury and interest, are words used interchangeably, unless, of course, the context otherwise suggests.
"Riba in its literal meaning is excess and in the technical sense in the Shari'ah, Riba is the stipulated excess without a counter‑value in Bai' (sale)."
As analysed by Nyazee, (supra) the quoted definition of Riba carries the following ingredients:‑‑‑
"(1) Riba is excess.
(2) .It is an excess that is stipulated in a Bay' exchange).
(3) It is an excess that is without a counter‑value. "
This then remains the classical definition of Riba and treats with the subject, in all its forms, without any distinction. The definition, besides being endorsed by the terminology in the Qur'an and Sunnah, is also logical because even in excesses on loans (nasi'ah) a thing of value is parted against a corresponding, though inadequate, return, the increase being matched with delay.
"It is important to appreciate that a loan of $100 at 10% per annum simple interest in 100 years comes to $ 1100 only, whereas at compound rate of interest, it comes to $1.378 million. This reflects the magnitude of the problems being faced by developing and underdeveloped countries of the world, which depend on foreign long‑term loans and are unable to pay the instalments of interest and principal amounts, due to poor economic conditions."
As distinguished from Zulm qua Riba, the potential to intoxicate is the illat behind the prohibition of al‑khamr (wine prepared from grapes) and, apparently, for that reason the prohibition has been read into all intoxicants. Accordingly, as to the un‑acceptability of Riba, it is really the Masaleh‑e‑Shari'ah or Maqasid al‑Sharf'ah (the expedients or objectives of Shari'ah), that equal its hikmat or raison d'etre. Those, in turn, hit the peculiar offer and acceptance in a Ribawi transaction, the peculiarity of the contract emerging from the hikmat, constituting the Mat, relative to the? targeted dealing. Some‑times, however, hikmat also can become Mat, as possibly in the above case of khamr.
"The objective of the Shari'ah is to promote the welfare of the people, which lies in safeguarding their faith, their lives, their intellect, their posterity and their wealth. Whatever ensures the protection of those five serves public interest and is desirable."
M. Umer Chapra, in his notable work, "Islam and the Economic Challenge", rightly draws attention to the comparative importance ascribed by the Imam to the elements of faith and wealth, the former having been cited as the first and foremost and the latter, the last factor for ensuring welfare. Such is and remains the basis of Islamic thought and teachings, the spirit being accorded pre‑eminence and matter relegating to the bottom, signifying the ordained priority of mind over body. What, therefore, applies to all Islamic concepts and institutions applies equally, if not more, to the principle of Riba.
"To strive for legitimate earnings is an obligation only next, after the ordained prayers/religious duties. "
"There is no better livelihood than that derived by employing one's own hands."
Clearly, Riba or interest on money or other things loaned does not involve any effort on the part of the lender and the very commodity loaned is returned together with the agreed addition solely against the time factor, which intervenes between delivery of the thing lent and the return thereof. It is elementary that allocated time is all that living beings have and yet time has little value unless productively utilized. Store anything of value, e.g., gold or silver, for decades on end, nothing would grow out of either. Hence the epitaph of Aristotle that money is "barren" or the condemnation of Gibbon: "The usurer, who derived from the interest of money a silent and ignominious profit" Dr. Waqar Masood Khan, Vice‑President, International Islamic University, Islamabad, who appeared before us, correctly contrasted Riba with Bai (sale), saying that all wealth is generated through exchange of dissimilar things, the only exception being Riba, which represents Bai of money against money i.e., an exchange in the same commodity, the sole difference being moneys at two different time periods, present against the future. Neither the Qur'an nor the Sunnah nor the Fuqaha have accepted moneys of different time‑frames as dissimilar articles, legitimately allowing any premium in their exchange. What is more, in such an exchange of similars, no risk to the lender is involved, no attention is riveted to the pecuniary state of the borrower and no weight attaches for the general good or well being of the society as a whole. Is all this just, fair and equitable? It will be instructive here to recall that Nassau Senior addressed the question whether profit and interest were paid for anything and whether there was an identifiable product of society that would not emerge if this form of income was not paid. He identified such function and called it abstinence. Karl Marx denied the existence of any such function and argued that the social product must be attributed entirely to acts of labour, capital being merely the embodied labour of the past. In the opinion of Professor Mehmood Ahmad (see his pioneering work, Man and Money, published by the Institute of Islamic Culture, Lahore), who has, upon sound reasoning, exploded these theories, savings would be generated yet, and capital formation? would take place still, even when the so‑called incentive of interest stands removed. Now, capital is a word of many meanings. They all imply that capital is a stock by contrast with income, which is a flow. In the modern view, it is capital and income rather than capital and interest that are the related concepts. Even so, the foregoing theorization constitutes mere semantics. Capital, quite arguably, is certificate/store of applied labour and its in‑put (statedly often equaling abstinence), if and when worked upon, may end up in generating income, which, in turn, could either be profit or interest. It is another matter though that interest may accrue yet even if capital, parted with, is not employed gainfully at all. Profit, these days, is defined broadly to signify "gain resulting from the employment of capital". This, obviously, also embraces interest within its fold. Profit, in its original signification, however, was a variable or uncertain positive return from capital invested (set apart, = purported abstinence) in an agricultural, industrial, commercial or other purposeful activity, where the contributor of capital stood to enjoy or share the gain as also to suffer or partake in the loss, if any, in the enterprise. The Islamic version of profit is still the same. Correspondingly, but without distinction, interest has been and is nothing but a definite return on the unit of a given store of value (money or goods), belonging to the lender against no more than parting with the same (supposed abstinence) for a stipulated quantum of time without the least effort forthcoming on the part of the lender and usually no anticipated risk attaching either‑to the thing lent or to the projected return thereon. Manifestly, such transactions, where idle money attracts and generates more idle money, lead to inequities in society, making the rich richer and the poor poorer. That which applies to individuals applies equally to their institutions, big and small, local, national or international. It is, thus, that the inequities and injustices so generated have transcended geographical frontiers and engulfed nations, states, communities alike. Two inter‑connected aspects may be mentioned here. One, as adverted to earlier, Islam discourages contracting of loans themselves because of the potential dangers inherent therein. Qarood‑e-?Hasana apart, Caliph Ali (r.a.a.) is reported to have equated debt with slavery and its discharge with emancipation. Second, domestic loans bad as they are, at the international level wealthy nations first habituate poor ones of the so‑called aid and then of gratuitous loans, finally coming down to usurious disbursals, leading invariably to a degenerative stage, where, what to say of the ability to repay the loans, the poor debtor countries cannot even service them, compelling the victims to contract more and more loans and survive only to pay‑‑‑a status even worse than slavery, as predicted by the last of the four pious Caliphs. This is the worst form of neo‑colonialism yet known to man.
Banks, which are the present day custodians of (people's) wealth and, therefore, the most proximate source of capital, are motivated, in this state of things, only to obtain the maximum returns (usually interest), irrespective of the nature of enterprise financed and to incur the least risk in securing the return of the investment and the gain thereon. The first of these priorities renders financial institutions virtual accomplices in the flow of capital to immoral, or at least unacceptable channels, encouraging speculation, gambling, narcotics, hoarding, luxuries simpliciter and pursuits catering to lasciviousness etc., whereas the second becomes instrumental in concentration of wealth in ever fewer hands because risk‑free capital outlay can only be assured by matching collaterals of which the poor segment of society has none or little. It is prompted by the latter of such aspects that democratization of capital‑that is the extension of the borrowing power to all classes in society‑emerged as one of the notable social movements of the 20th Century. As to the first, regrettably, economists and social scientists have yet to focus attention thereon. The earlier they do so, the better. In this overall milieu, the potential, as to the twain of utility and efficiency, of a venture rarely enters the equation.
All this apart, interest, inter alia, is also a known factor in inflating of prices at every level of economic activity viz., manufacture, wholesale retail etc., each economic agent adding its profit in the price charged but treating interest as part of the cost structure on which even income‑tax is usually exempt. As against this, evincing partiality, if not anything more, profit is fully taxed, much like any other mode of income. So, pervasive has interest become in the world economic order that members of the work force (particularly in the West) rarely cast eyes on their salaries, the bulk going towards purchases and instalments already constructed, of course, with the inevitable interest ingredient covering a substantial portion of the outgoings.
Having said as much, let it not escape mention that the now well-?documented cycles of inflation and deflation, may only be an end product of an interest‑based world economic scene (e.g., banks and financial institutions generating manifold money supply etc.), much as the frequent movements of short term (hot) money from one geo‑economic zone to another, often bringing misery and devastation in their wake, as has been witnessed recently in the case of the East Asian, so‑called tiger economies. The main judgment of the Bench, authored by Mr. Justice Khalil‑ur‑Rehman Khan, is replete with data, depicting the awesome magnitude of short term money movements, so devastating in their impact. Likewise, the proposed judgment of my learned brother, Mr. Justice Muhammad Taqi Usmani, besides being singularly crudite, also contains valuable source material, reflective of the potential dangers and pitfalls in an interest‑oriented economy and the manifold advantages that a Riba‑free economic order ensures. As to the alternating cycles of inflation and deflation in the present day economic scene Prof. T.H. Watkins of Montana State University and author of "The Hungry Years: A narrative History of the Great Depression in America," in his article, "Myth of eternal boom", focusing on the attitudes of the pupils around him, writes:‑‑
"Although the market has been erratic of late, and there are jitters about inflation, many commentators say there seems to be no reason why this saraband of prosperity cannot continue indefinitely, and confidence continues to ring from nearly every quarter of society.
That includes the young men and women who surround me. I look upon them and wonder if my generation is the last to remember that there is no such thing as limitless prosperity. All booms are followed by busts. All of them.
Most of us grew up with the memory of the worst bust of all, the Great Depression, firmly fixed in our family consciousness; even 1, born in 1936, have floating in my mind shadowy images of destitude men, women and children travelling along Route 66, near where my family lived in California, and my mother and father carried the Depression's scars all their lives. They used their experience as a cautionary tale, and it is as real to me as the nightly news, sometimes moreso.
Yet I find myself reluctant to play Cassandra to a generation that seems not to want to know the reality written in my family bones: that there once was a time very like theirs in which, as Frederick Lewis Allen put it in `Only Yesterday, the prosperity bandwagon ...rolled down Main Street,' but that the era ended abruptly and catastrophically, particularly for people of precisely their age.
They cannot imagine that at one point 28 per cent. of Americans had no incomes at all‑a figure that, if applied to today's population, would come to nearly 73 million people. Nor can they imagine that grown men and women, people just like themselves, once were driven to begging in the streets and fighting like junkyard dogs over scraps buried in garbage heaps, or that we still do not know precisely how many people were killed in the longest and bloodiest period of class warfare in our history.
They cannot conceive that it could happen again‑‑‑that to one degree or another, it will happen again."
At best, relatedly and consequently, while individuals in an interest ?ridden society may, ostensibly but momentarily, prosper and while goods and services may be generated from the capital, so expended, the society, as a whole, is potentially the sufferer. The element of Zu1m, thus, demonstrated as the rule rather than an exception in Ribawi transactions, emerges as one of the many reasons why the Shari'ah ordains prohibition of Riba. Viewed, thus, Zu1m often attracts the hikmat if not the illat behind Ribawi pursuits.
"They ask thee (O Muhammad), what ought they to spend (in the way of Allah): Say: "What is beyond your needs." (S.II:219)
"The parable of those who spend their wherewithal in the way of God is that of a grain of corn: it groweth seven .ears, and each ear hath a hundred grains. Allah giveth increase manifold to whom He pleaseth: and Allah is All‑Embracing, All‑Knowing". (S.II: 261)
"And there are those who bury gold and silver and spend it not in the way of Allah; unto them give tidings (O Muhammad) of a painful doom: On the Day when heat will be produced out of that (wealth) in the fire of Hell, and with it will be branded their foreheads, their flanks, and their backs, (and it will be said unto them): Here is that which ye hoarded for yourselves: taste ye then, the (treasure) ye used to hoard!" (S.IX:34‑35)
"That which ye lay out for increase through the property of (other) people, will have no increase with God: but that which ye lay out for charity, seeking the Countenance of God, (will increase): it 's these who will get a recompense multiplied." (S.XXX:39) ;
....and nothing do ye spend in the least (in His Cause) but He replaceth it: for He is the Best of Providers." (S. XXXIV:39)
"Lo! Those who give in charity, men and women, and lend unto Allah a goodly loan, it shall be increased manifold (to their credit), and they shall have (besides) a liberal reward." (SLVIL18)
"And they feed, for the love of Allah, the indigent, the orphan, and the captive, ‑‑‑ (saying), "We feed you for the sake of Allah alone: no reward do we desire from you, nor, thanks". (S.LXXVI:8‑9)
"(It is)????.freeing the bondman; or the giving of food in a day of privation to an orphan near of kin, or to the indigent (down) in the dust. Then to be of those who believe, and exhort one another to perservance, (patience, and self‑restraint), and for deeds of kindness and compassion." (S.XC:13‑‑‑17)
"Did He not find thee an orphan and protect (thee)? Did He not find thee wondering, and direct (thee)? Did He not find thee in need and provide (thee)? Therefore, the orphan neglect not, therefore. the beggar drive not away, And, therefore, the bounties of thy Lord convey!" (S.XCIII: 6‑‑11)
Charity as such is enjoined, encouraged and approbated, inter alia, in the following verses:‑‑‑
"Those who spend their wherewithal in the cause of Allah and do not mar their generosity with insult or with injury for them awaiteth recompense from their Lord‑‑‑No fear doth come upon them, no sorrow doth touch them." 262.
"Apology with kind words is better than bestowal with ill‑will. Allah is Undependent, Understanding." 263
"O ye who have believed! Mar ye not your generosity by publicizing it and (thereby) hurting (its recipients). Be not like those who spend for mere show‑believing neither in Allah nor in the Final Day. Their likeness is the likeness of a solid rock thinly covered with rich soil: a shower of rain washeth off the soil and lo, it is a barren stone! Naught will they achieve with what they've garnered. Allah guideth not pretenders." 264
"But the likeness of those who spend their wherewithal seeking for the goodwill of Allah and for strengthening themselves (as a group), is the likeness of a garden raised on high‑showers of rain and clouds enhance its produce many times, and even` if it raineth not the clouds suffice‑‑‑Allah, of what they do is quite Aware." 265 (11: 262‑‑265)
"Those who (in charity) spend of their wealth by night and by day, in secret and in public, verily their reward is with their Lord: on them shall be no fear, nor shall they grieve." (S.II: 274)
"Those who believe, and do deeds of righteousness, and establish regular prayers and regular charity, will have their reward with their Lord: on them shall be no fear, nor shall they grieve." (S.II: 277)
"Successful indeed are the believers, who are humble in their prayers, And who shun vain conversation, And who are active in deeds of charity." (XXUI: 1‑‑‑4)
"Seest thou one denies the Judgment (to come)? Then such is the man who repulses the orphan (with harshness), and encourages not the feeling of the indigent. So, woe to the worshippers who are neglectful of their Prayers, those who want .(but) to be seen (of men), but refuse (to supply) (even) neighbourly needs". (S.CVIL 1‑‑7)
Spending in the way of Allah and charitable pursuits have been equated with loans to the Almighty Himself, amongst others, in these verses:‑‑‑
"Who is he that will loan to God a beautiful loan, which God will double unto his credit and multiply many times?" (S.II: 245)
"If ye loan to God a beautiful loan, He will double it to ?your (credit), and He will grant you Forgiveness: for God is most Ready to appreciate (service), Most Forbearing,‑‑‑" (S.LXIV: 17)
In short, the Nizame Zakat, Ushr, Sadaqat, Kairat and Qarooz‑e‑Hasna pre?empts and precludes the concentration of wealth in a few hands and what still remains in the way of possessions, after the Islamic law of inheritance further divides it is the subject of such lofty declarations as are reproduced below :-
"It is not righteousness that ye turn your faces to East or the West; but righteous is he who believeth in Allah and the Last Day ‑and the Angels and the Scriptures and the Prophets: and giveth his wealth, for Him, to kinsfolk and the orphans and the needy and the wayfarer and to those who ask, and to set slaves free; and observeth proper worship and payeth the poor‑due. And those who keep their treaty when they make one, and the patient in tribulation and adversity and times of stress. Such are the God‑fearing." (S. II: 177)
"Fair in the eyes of men in the love of things they covet: women and sons; heaped‑up hoards of gold and silver; horses branded (for blood and excellence); and (wealth of) cattle and well‑tilled land. Such are the possessions of this world's life; but in nearness to God is the best of the goals (to return to)." (S.III: 14)
"What God has bestowed on His Apostle (and taken away) from the people of the townships, belongs to God, to His Apostle and to Kindred and orphans, the needy and the wayfarer: in order that it may not (merely) make a circuit between the wealthy among you." (S.LIX:7)
In A1 Nehl (XVI: 95‑96) is the following and perhaps the ultimate tiding for those, who hearkened to the call:
"And purchase not a small gain at the price of Allah's covenant. Lo! That which Allah hath is better for you, if ye did not know." 95
"That which ye have, wasteth away, and that which Allah hath, remaineth. And verily We shall pay those who are steadfast a recompense in proportion to the best of what they used to do." 96
No better practical translation of the preceding verses from Al‑Nehl is possible than in the ensuing report: The Prophet (s.a.a.w.s.), on one occasion, when he, after the day's work, returned home. asked whether any thing in the way of edibles was available. Hazrat Aisha (r.a.a.), the Prophet's spouse, replied that, as customary with the first household amongst Muslims, all that there was had been given to the needy but that a small portion was saved. Replied the last amongst the Prophets (s.a.a.w.s.). Saved is not that, O'Aisha, which you surmise to have retained; in truth, saved is such that you have disbursed, as succour, for the needy and the indigent. So great .was the identity in the Prophet's (s.a.a.w.s.) word and deed that, after his passing away, when one, who had not seen the Holy Prophet, asked of Hazrat Aisha (r.a.a.) as to what was the Prophet like, the latter, instead of making reply, posed a counter‑question viz., whether the questioner had not read the Qur'an whereupon, reply having been received that indeed he had, the Ummul Momineen (mother of the believers) stated that he, the Prophet (s.a.a.w.s:), was the Qur'an personified.
??????????? In so far as the Prophet (s.a.a.w.s.) himself or his family was concerned, he denied either of most of the foregoing offerings. As correctly pointed out by Prof. Hiti, he is the only Prophet, who lived during the period of recorded history, and withstood the test thereof. He (s.a.a.w.s.) first practised on himself and his own, what he preached. As would be seen shortly he, during his celebrated sermon on the occasion of Hajjat‑ul‑Wida, before abolishing the blood claims of others, began by abolishing that of minor Ibne Harith of Banu Hashim, his own tribe much as, before, finally, remitting interest dues of the rest, first remitted those of his own uncle, Abbas, who had only lately entered the fold of Islam. It was this volubly transparent conduct, which provided such momentum to his message that, in spite of all possible corrupting influences from adversaries, within and without, it is only lately that the march of Islam has momentarily been thwarted. See the quote appearing below:
"He even went to the extent of prohibiting the acceptance of Zakat to the entire clan of Bani Hashim, to which he himself belonged, by proclaiming in an unequivocal manner that 'Sadqa' is not allowed to us. On his own part he strictly abstained from accepting charity in any form. It is related by Abu Huraira that when anyone brought to the
Prophet something to eat he used to enquire whether it was by way of gift or
Sadqa and partook of it only when he was assured that it was a gift and if it turned out to be Sadqa he declined to eat it and offered it to the Companions'.
He also forbade his kinsmen from accepting charity so that they did not become accustomed to it and the Muslims did not choose his family for making such offerings to the exclusion of others. It is related by Abu Huraira that once
Hasan bin Ali (one of he Prophet's grandsons) put a date of Sadqa in his mouth.
The Prophet admonished him and told him to spit it out.Do you know' he said, `that we do not eat charity'?"
"This injunction held good during the lifetime of the Prophet as well as after his death. It is related that the Prophet once remarked. Sadqa is the grime of the people and it is not permitted to Muhammad and his descendants to accept it. The Islamic Corpus Juris (Fiqh) has consistently upheld this principle and it has been acted upon all the way in Muslim Society. The doors of Zakat and alms‑giving have always remained open for the general body of Muslims, to the poor, the needy and the destitute, and their rights have never been ignored.
"The attitude of the sacred Prophet towards his kinsmen was the same in 911 such matter's. They were kept at the head of others when it came to giving or incurring a loss, but where economic benefit was concerned they received the smallest portion of it. "
Anticipating the foregoing analysis and indeed an essential argument of other Juris consults etc. who have appeared before us, the learned counsel for the Federation, Mr. Riaz‑ul‑Hasan Gillani, has urged that the term Riba, as it occurs in the Qur'an and the Ahadith, is none other than Riba al‑Jahiliyyah or Riba al‑Nasi'ah, and the Prophet (s.a.a.w.s.) has himself said:
"Riba is in the nasiah:" (Muslim))
"There is no Riba except in nasiy'ah:" (Bukhari)
Without questioning the authenticity of the quoted Ahadees, which is usually cited as from Usama bin Zaid (r.a.a.) but also, through Usama (r.a.a.), from Ibn Said al Khudri (r.a.a.) the fact remains that the Holy Prophet (s.a.a.w.s.) also spoke of and, according to some, even introduced Riba al?Fadl. The significance of the Hadees under reference can, therefore, only be contextual rather than absolute. Ulema (Muslim Jurists) have explained the Hadees in various ways. Some opine that, in the presence of Riba al‑Fadl, which may encompass. specified increases even in spot transactions, the only meaning, which can be ascribed to the Ahadees is that such has a nexus merely with non‑Ribawi commodities, in exchanges whereof increase is permissible but credit is prohibited. As seen, a number of Ulema of different persuasions, in elaboration, have rendered that where the commodities are different e.g., wheat and barley or wheat and gold/silver, excess in exchange, is allowed and loan alone is prohibited. The same significance is attached by Fuqaha (jurists) to another Ahadees descended from Amirul Momineen (Leader of the faithful), Ali ibn Abi Talib (r.a.a.) namely:
"Every loan from which a profit accrues is Riba. "
Another interpretation, that handed down by Ibn Rushd is:
"It is probable that he intends by his statement, `there is no Riba except in nasiah', that this is what is the usual case. If this is what is probable, when the first is explicit about it, it is necessary to interpret in a manner that reconciles the two."
(Bidayat al‑Mujtahid, Vo1.2, 163)
Nothing, therefore, turns on the argument, thus, premised.
In further elaboration and indeed support of the foregoing argument viz., that the Qur'an only proscribes Riba al Jahilyyah or Riba al‑Nasi'ah the following narration of Imam Malik from Muwatta is also quoted:
"Zaid bin Aslam reported that interest in Pagan times was of this nature: when a person owed money to another for a certain period and the period expired, the creditor would say you pay me the amount or pay interest. If he paid the amount it was well; otherwise the creditor increased the loan amount and extended the period for payment again. "
The passage quoted from Imam Malik is, in turn, occasionally reproduced verbatim by later day Jurists, when recording the essential features, occurring in Riba al‑Jahiliyyah. Now, it must straightaway be stated that the contours and paradigms of Riba, which was not mere Riba al‑Jahilyyah nor only Riba al‑Nasi'ah, are fully set out in the Qur'an and Sunnah and from there it emerges, as clearly as can be, that all fixed or predetermined returns on money or other things of value lent as also in all exchanges of chattel of the kind and subject to the restrictions imposed in the Ahadith, is naught but Riba. As stated above, definitions only constrict the meanings and confine words or expressions to the defining clauses. Islam being the final shape ascribed to religion and descended through the ultimate amongst Prophets, it is in the intendment of the Qur'an and Sunnah that the meanings and implications of Riba have to be discovered. In context, much as the claimed illat for the prohibition is irrelevant not dissimilar is the position of what, allegedly, passed as Riba or otherwise in the days of ignorance (Jahiliyyah).
The argument having been disposed of, thus, it may, nonetheless, bear mention here that what Imam Malik and the other Jurists, under reference, meant when they described Riba al‑Jahiliyyah, as above, was no more than spotlighting the ultimate shape, which a transaction qualifying as Riba al‑Jahiliyyah finally assumed. This may be demonstrated immediately: the quoted narration could involve firstly, that the loan, taken initially, did not carry any interest whatsoever which, if such was the case, would normally be improbable for a subsequent such imposition of Riba, as under discussion. Secondly, the transaction may have covered a situation where, in actuality, a smaller sum was contracted but a larger, one, was shown to be payable at a ‑late point of time and in case of non‑payment, within time, the stipulation narrated may Have come into play. This could take various, forms.‑ . One such may have been to set the imposition in motion .whore, ‑in the case of a Bai Mu'ajjal (credit sale), the contracted money was riot required at the time appointed and the creditor (seller) became .entitled to clamp the‑ pre?determined or other penalty. A similar situation has ‑been recorded. by Qatadah Ibn Di'amah, a tabi'I (d.120 A.H.) This, in also another context, is recounted by Imran Ahsan Khan Nyazee in "The Concept of Riba, and Islamic Banking" as follows:
"A credit sale is one where the buyer acquires the goods sold and promised to pay later after a determined period. It is to be expected that the seller in such a case will charge ‑a slightly higher price than he would if the payment was made in cash. Thus, the seller and the buyer used to agree upon a period within which the payment would be made and the excess in price was not stipulated separately...
Increase at the end of the period of payment.‑‑‑When this period was over the seller demanded his money from the buyer saying: `Will you pay or increase the amount due in lieu of further delay.' In case they agreed upon a further delay, the buyer not being in a position to pay or not wanting to pay for some other reason, the amount due would be increase or even doubled."
A third situation may have been, as appears frequently to be the case with money‑lenders, throughout the various phases of history, the charging of a periodic return, such as on monthly, quarterly, half‑yearly or yearly basis, with an ultimate date of return of the principal, timely non‑return, generating the penalty of further interest, as reported by Imam Malik. While Mussanaf Abdul Razzak (d. 211 A.H.) and Mussanaf Ibne Sheba (d. 235 A.H.) also describe Riba al‑Nasi'ah transactions, it is Imam Fakhruddin Razi's (534/ 1149‑606/ 1209). report, which identifies Riba al‑Nasi'ah in the precise terms preceding. Such is as appears below:
"Riba al‑Nasia was a type well known and widely used in Jahilliyah. It was that (lenders) provided valuables on condition that every month they would take a specified value, but the original valuable would remain intact. When the period of loan concluded (lenders) would demand from the debtor the original value loaned. But if return was not possible for him, they increased in the right and time. This Is the Riba they practised in Jahiliyah. (Al‑Tafseerul Kabir Razi, Vo1.7, p.91; Matba Bahria 1938)."
Look, therefore, whatever way one may even Riba al‑Jahifyyah was nothing but the common interest not unknown to mankind throughout the passage of time. Indeed Imam Abu Bakar A1 Jassas (d. 370 A.H.), in "Ahkamul Qur'an", has generally, elaborated upon Riba al Jahiliyyah in these words:‑‑‑
"That, which the Arabs understood as Riba and, mutually, treated as such, was only this: lending Dirhams (silver coins) and Dinars (gold coins) for a fixed term and, by mutual agreement, stipulating an increase thereon‑‑‑This was introduced to and well known amongst them‑‑‑So Allah Almighty voided their trading in interest‑‑‑And together with that some modes of sale and purchase were also declared as null."
Banu Thaqif of Taif indulged heavily in interest‑oriented transactions and it was a dispute regarding such transactions with Bani Mughirah of Makkah, which led the Prophet (s.a.a.w.s.), to enforce the prohibition in all firmness (8 A.H.) also drawing upon the covenants, precluding Ribawi dealings, in the treaty with the Taifites. Reverting, as to the deployment of the merchant capital and whether the same was for consumption or productive purposes M. Abu Zahrah in Buhuth if al‑Riba reports:
"There is absolutely no evidence to support the contention that the Riba of al‑Jahiliyyah was on consumption and not on development loans. In fact the loans for which a research scholar finds support in history are production loans. The circumstances of the Arabs, the position of Makkah and the trade of Quraysh, all lend support to the assertion that the loans were for production and not consumption purposes."
Much to the same effect is the refrain of Abraham Udovitch in his "Partnership and Profit in Medieval Islam" when he says:
"Any assertion that medieval credit was for consumption only, and not for production is just as untenable with reference to the medieval Near East."
Be that as it may, because interest or usury, in a large measure, was at the back of these transactions, the same helped concentrating wealth in fewer and fewer hands, causing disruption in the clan based social structure. Indeed many a Makkans, who thrived partly upon usury and partly upon trade and commerce later came to play prominent roles in Islam. They included the Prophet's uncle, Abbas bin Abdul Muttalib (r.a.a.), his son‑in?-law, Usman bin Affan (r.a.a.), his favoured general, Khalid bin Walid (r.a.a.) and the celebrated Abdul Rahman bin Awf (r.a.a.), etc. It was in this state of things that the prohibition of Riba was, systematically, ordained in the Qur'an and the Prophet of Islam, on the occasion of Hajjat‑ul‑Wida (the last pilgrimage, 9th Zil Hijjah, 10 A.H.), before a large congregation of over a hundred thousand pilgrims, inter alia, declared:
"Behold! All practices of paganism and ignorance are now under my feet.
The blood revenges of the days of ignorance are remitted. The first claim on blood I abolish is that of "ibne Harith who was murdered in the tribe of Saad and whom Hudhail killed.
Usury is forbidden but ye would be entitled to recover your principals. Wrong not and ye shall not be wronged. Allah has decreed that there should be no usury and I make beginning by remitting the amount of interest which Abbas Abd Al‑Mutalib has to receive."
Note that the highlighted words and phrases are a repetition of Al‑Baqarah II: 278‑‑‑281, indicating, as above stated, that such verses from A1 Baqarah must have been revealed earlier, thus, contradicting the alleged lament of Caliph Omer (r.a.a.) that the last verses on Riba were too close to the Prophet's (s.a.a.w.s.) recall, resulting in lack of time (the Holy Prophet lived for 81 days even after the farewell pilgrimage) to enlarge thereupon.
As to the remitted interest accumulated in favour of Abbas Abd Al?Mutalib, who reportedly embraced Islam a little prior to the bloodless conquest of Makkah (Ramadan 20, 8 A.H.). Dr. M. Umer Chapra in "Towards a Just Monetary System" observes:
"This was interest on business loans extended to Bani Thaqif tribe. This tribe had not taken the loans from Abbas and others for fulfilling consumption needs but for expanding their business. "
???????????
In the foregoing background, it is futile to urge that the various forms of Riba were not known at the time of the Qur'anic revelations or that only one form had come to be prohibited. Indeed, as pointed out by Thomas Patrick Hughes (ibid), the Old Testament had operated to proscribe usurious transactions in Chattekas well and the Arabs, in turn, would contrive excesses in exchanges between similar or dissimilar things in ready as well as forward transactions, a practice which was countered by the Shariah, through the institution of Riba al‑Fadl. Now, the Fuqaha represented the dominant culture of their times and it is inconceivable that they could ignore the most obvious forms of interest then prevalent, no different than those which continue to be commercially in vogue to this day. The very wide? consensus amongst the Ulema, irrespective of time and location, as regards the prohibition of Riba and their manifest agreement that such was to be rooted out, totally and irrevocably, suggests that at no time or place the Fuqaha had any doubts as to ingredients and connotations of Riba. Indeed the Prophet of Islam (s.a.a.w.s.) had himself amplified, in the most specific of terms, all that was intended to be prohibited something, which had come to be crystallised in the only, and yet conditional, Qur'anic permission:
"And if you do it not, then be apprised of war from God and His Messenger, but if you repent (and give up interest) then you shall have your capitals; Deal not unjustly (with others) nor shall ye be dealt with unjustly. 279.
"And if (any debtor) be in straitened circumstances, then let there be respite until (he is in) ease; but that if you forego it (even the capital) (as charity) it is better for you ye only knew. 280
And fear the Day wherein you shall return to God; each one shall be measured back in full what he earned and they shall not be wronged." 281
(al‑Baqarah II: 279‑‑‑281)
It is next contended by Mr. Riaz‑ul‑Hassan Gillani and some other proponents of curtailing the meanings and implications of Riba, that the Qur'an speaks not merely of Riba but of al‑Riba, thus, identifying and singling out the Riba which was prevalent at its advent namely, Riba al? Jahiliyyah and none other and for that reason alone bank and other kinds of interest, evolving in course of time, do not qualify as al‑Riba. The argument can brook little further consideration in the face of the now established proposition that the Qur'an and Sunnah embrace all unearned additions and increases (i.e., without counter‑values) over and above the principals exchanged ("you shall have your capitals" Al‑Baqarah) and, thus, bank and other modern forms of interest equally fall within the fold of Riba. Besides, even the argument's present angle over‑looks the peculiar mode in which the Qur'anic diction is couched. The syllable "al" does not seem to have been added to restrict the prohibition only to the Riba prevalent in the then Arab Society or even the known world: On the contrary, other similar pre‑fixes in the Book e.g., al‑Khimr and al‑Fahisha, as identified by the Federal Shariat Court, would indicate that neither the liquor used in the then Arab Society alone was prohibited nor were immoralities restricted to those, which prevailed amongst the Arabs at the time. Note also that similar use of the pre‑fix "al" in Riba al‑nasi'ah (Riba in loans) and Riba al‑Fadl (Riba in trade) neither signifies a particular loan nor a specific trade. Besides, as already said, Islam did not come to reform a particular people, race or clime nor is it confined to any particular period or time. Its massage is universal and timeless.
Another argument advanced has a two‑fold dimension and impact. Firstly, it is urged that Riba al‑Jahiliyyah (confined within the limited connotations, as above contended) having alone been prohibited (haram) for Muslims as well as non‑Muslims in Darul Islam and Riba al‑Fadl, in contradistinction, being detested or disapproved (makrooh) for Muslims but freely permitted to the rest, any enunciation, holding bank or other modern day interest to be encompassed within the prohibition, would only allow benefits to non‑Muslims at the expense of the Muslim population of an Islamic State. Expediently, as inherent in this reasoning, is hardly a consideration in applying the rules of interpretation. Even otherwise, the argument, in its own terms, is untenable for the simple reason that if banking and other interest is found covered within the four corners of Riba al‑Jahiliyyah or Riba al‑Nasi'ah the same, as discussed below, would .equally be prohibited amongst the Muslim as well as the non‑Muslim components of Darul Islam. The other limb of the argument, which may now be taken up, is to the effect that there can be no Ribawi transaction between a Muslim arid a Harbi nor does the. prohibition of Riba cover transactions exclusive to the populace of Darul Harb, irrespective of the components of believers and non‑believers therein. In context, two Ahadith of the Holy Prophet (s.a.a.w.s.) may be quoted and such are recorded, thus:‑‑‑
"there is no Riba between ahlul harb and ahlul Islam". "There is no Riba between a Muslim and a harbi within the bounds of darul?harb".
Irrespective of the authenticity of the quoted Ahadith, an aspect which need not detain us here, the argument revolves around the question as to who is a harbi .and what is meant by Darul Harb. For obvious reasons, zimmis, that is to say, non‑Muslim citizens of a Muslim State and mustamin viz., other non‑Muslims, who, for the time being, with the permission of a Muslim State, happen to be in such a State do not fill the character of being harbi (hostile, war‑like), a word which, in its pristine sense, should signify an enemy alien. Correspondingly, the expression Darul Harb literally abode or country of the enemy) may not denote every non‑Muslim State. There has been a difference of opinion, amongst jurists, as to this, some going as far as to find even the seas and the oceans degenerated into Darul Harb. Imam Abu Hanifa (r.a.a.) has spelled out three attributes for treating a polity as Darul Harb: one promulgation therein of laws ordained by non‑believers (interpreted to mean effect disappearance of Sharia'ah rules and practices); two, contiguity of the area with Darul Harb and three, non survival therein of a free and peaceable subsistence for Muslims and zimmis, as emanating from a previous Islamic legal order. The Sahibeen (his disciples, meaning Imams Muhammad and Abu Yousuf, great jurists in their own rights), however, hold that Darul Islam turns into Darul Harb merely upon the emergence of non‑believers' legal order. This is all very well where non?believers come to hold sway in Darul Islam and such relegates to Darul Harb. But, that kind of thing never happened during the days of the Prophet (s.a.a.w.s.) as Islam was then in the ascendant. Thus, Darul Harb, at the time, could arguably be a non‑Muslim legal entity at war with the Muslim State. The category, in all likelihood, also would not extend to a non?Muslim entity without any pretentions to wage war with the then world of Islam. With all respect, what was true at the advent of Islam should also be true now. Therefore, the expression, may cover only such a non‑Muslim State as be at war either with the entire world of Islam or with the particular Muslim State, of which a Muslim citizen is either located in such Darul Harb or is found have contracted a Ribawi loan with any of his non‑Muslim harbi counterparts. It follows, as a corollary, that people, frequenting the planet, are classifiable in the under‑noted categories:‑‑
(a) Muslims. ???
(b) Zimmis (non‑Muslim citizens of a Muslim State).
?(c) Mustamin (non‑Muslims who, by permission, happen, temporarily, to be in a Muslim State).
(d)??????? Non‑Muslims who are neither Zimmis nor Mustamin. They should fall in one or the other of the following sub‑headings:‑‑‑
(i)???????? Those, who somehow are located within the precincts of a Muslim State;
(ii)??????? Those who are citizens of a non‑Muslim State;
(iii)?????? Those who are citizens (resident or otherwise) of a State at war (actual or potential) with the Muslim State.
The last‑mentioned alone (d)(iii), should fill the character of Harbis and the State they belong to qualify as Darul Harb. A process of elimination would also reveal that there must also have been, and should subsist yet, a big chunk of neutral territory, neither qualifying as Darul Islam nor filling the character of Darul Harb, covered by (d)(ii) above. A priori it follows that the Prophet (s.a.a.w.s.), in the ahadis, above‑quoted, may only have been referring to ostensible Ribawi dealings between Muslims and their said (at (d)(iii) above) harbi counterparts, either within or without the bounds of Darul Harb. .May it also be noted here that there is a consensus amongst jurists that Riba as between Muslim and Zimmi citizens of a Muslim State, (the rule extending to Mustamin), is as much prohibited as amongst Muslims themselves. Indeed, by and large, the usual civil rights and obligations as also criminal or penal liabilities extend to all such people (Zimmi and Mustamin), if duly located, except dealings in and consumption of wines and pork, the last two excluded because such may not have come to be prohibited for them according to their religious practices.
A long drawn debate has, historically, regard amongst other Muslim Scholars of the then British India, some of whom appear to have condoned payments of interest received by Muslims from banks and other institutions of non‑Muslim States, ostensibly treating the latter as Darul Harb and such British or other institutions as harbi. Interestingly, while some other jurists treated British India as Darul Islam, saying that many of the Shuaere Islam (precepts and practices of Islam) still continued to be in vogue there, they yet exempted interest and ex gratia receipts from the British Government, provided only that the Muslim recipients did not notionally regard the same as Riba. The same held good for similar receipts from British Indian institutions of which Muslim(s) were not owners, in whole or in part. Most, in effect, treated non‑Muslims and their exclusive institutions as Harbi and refrained from labelling unearned returns upon the capital deployed with such non‑Muslims and related institutions as Riba. These Fatawa (legal opinions on debatable issues) are not only of doubtful authority but have also occasioned allegations and counter‑allegations of mala fides, concerning the author Ulema, subscribing to different schools of thought. Hakeem Hashmi, propounding the astounding theory that bank interest is nothing but Mudarabah, in his "Tablighee Silsila" 62 and 63 under the title, "Musalman our Sood" has, in purported support. quoted from and named names of Ulema from the British Indian interlude, which do not make a pleasant reading. Bulk of these quoted Fatawa, also elsewhere available, hold that whereas it is permissible for Muslims, in Muslim and non‑Muslim countries alike, to lend against interest to non‑Muslims, located other than the Darul Islam, it remains impermissible for some, but permissible for other jurists, to borrow from such non‑Muslims in consideration for payment of interest. In other words, gain from the resulting transactions is deemed acceptable but there is a difference of opinion as to outgoings/defrayals upon Muslim borrowings, over and above. the principal sums borrowed‑ A diluted version of this thinking is to the effect that whereas such incoming interest may be suffered, apparently, on grounds of necessity, the same may only be utilized towards alms‑giving or other charitable objects, implying thereby that while Muslims, as is their present day wont, may continue to squander their other possessions in self ?serving pastimes, the most questionable part of their incomes be allocated to the worthiest of causes, upstaging it beyond all recognition from its actual lowly station. An extension of some the foregoing dicta, as regards the present day India and its Muslim citizens, is reflected in "Jadid Bankari Aur Islam" by Md. Nizamuddin Rizvi. With greatest respect, such‑like enunciations, wholly misconstrue the Qur'an and Sunnah, palpably ignore the treaties concluded by the Holy Prophet (s.a.a.w.s.) (e.g. with the Christians of Najran and the polytheists of Taif) and the Khulfa‑e‑Rashideen (the first four pious Caliphs) with non‑Muslim tribes and other political entities, envisaging voiding of such treaties themselves in the event the non-?Muslim signatories to the same did not observe the prohibition as to Riba even amongst themselves and recklessly engender free flow of Muslim? owned capital to non‑Muslim individuals, institutions and States alike. It is a direct consequence of this kind of flawed approach that all Muslim finance that matters, currently, stands parked either in non‑Muslim organizations or their States. To whose advantage, it need hardly be asked!
Be that as it may, the compounded result has been a' virtual legislation of Riba between Muslims and non‑Muslims., on the one hand and their respective countries on the other. Not only this, the message that has passed equates the absolute prohibition of Riba in Islam to a qualified one, as seems to have prevailed amongst the Jews, who made a distinction between themselves and strangers in the matter of Ribawi transactions, something, which one or the other of the schools of thought in Islam would term as a later day deviation from the original text of the Old Testament, that in this view probably carried a similar prohibition, as revealed in the Qur'an.
The essence of the conclusions, based on the preceding discussion, is that Islam does not permit Riba in any shape or form, whether amongst Muslims or between Muslims and non‑Muslims (other than harbis), irrespective of the question where any of such contracting parties is domiciled or otherwise located. The prohibition applies equally to non‑Muslims located within the bounds of a Muslim State. The commandments as to Riba, inclusive of the present day practices of interest and usury, being all pervasive, transcend individuals and envelope not only groups of men or their institutions but even geographical entities such as State edifices. The concept of Riba itself has no nexus whatever either with productive or non‑productive loans or the soft or hard terms upon which Riba is generated incidental to such loans. As to the effect of Ribawi transactions, qua the persons or social structures targeted, such are void ab initio but, not unlike other void contracts, the beneficiary is obligated to return the benefit derived from the deed, to wit, the capital borrowed, as ordained in the Qur'an and Sunnah. Seen in this perspective, all interest bearing loans or advances, whether between depositors and banks, financial or other institutions or between any other category of borrowers and lenders, including Governments or their agencies, whether sovereign or otherwise, would be hit by the Islamic Injunctions concerning Riba and, as from the efflux of the time frame(s) prescribed no lender would be entitled to claim anything more than that loaned nor any borrower be liable to pay anything in excess of that borrowed. As for the interest, which has already accrued, accounted/paid for or otherwise standing appropriated in the context of Ribawi transactions such, as postulated in the Qur'an and Sunnah, would remain a matter between the offender(s) and his Creator.
In the first place, it is absolutely wrong to assume that a total disruption and irreversible chaos would follow upon a switch‑over from a Ribawi economy to an Islamic economic order. It has correctly been pointed out by Professor Khurshid Ahmad, who appeared before us, that the prevalent economic order in Pakistan would not collapse with the introduction of the Islamic system but that such would, surely, erode totally if the present system continues to have sway. Not only Professor
Khurshid Ahmad, but many other eminent economists, scholars and juris consultants, who found time to appear before and assist us, have adverted to irrefutable data to bring home the reality behind the misleading facade of the current economic dispensation. In so far as the banking sector is concerned there are varying reports of the defaulted loans aggregating rupees 300 billion
(neutral observers' view) to rupees 211 billions (erstwhile official version) and, the latest, that of the present Finance Minister, Mr. Shaukat Aziz, of a sum in excess of rupees 148 billion but then the last‑mentioned figure is backed by a definition of default, implying non‑payment by a borrower for a period of one year on more, preceding the preparation of the data. Knowing, as we do, the continued so‑called exercises of re‑scheduling of bad debts in the banking sector, the figures premised on the foregoing definition of default have, at the minimum, to be taken with a grain of salt. Thus, the banking sector presents a very serious situation. Here, neither the lenders nor the borrowers fill the conventional roles and, in fact, these positions stand reversed in so far as the modern day banking is concerned. Contextually, the lenders (i.e., bank depositors) are small savers, virtually supplying their life blood in bank deposits and, being essentially from the middle and low income groups, run into millions. Their counterparts in banking transactions, banks filling the role of middle‑men, represented by borrowers/entrepreneurs, supposedly engaged in agricultural, industrial, commercial or other productive pursuits, as elaborated by Mr. Shahid Hassan Siddiqui, are in thousands if not in hundreds. For decades the latter class has done little in generating the economy, has ensured a minimum stake in the enterprises run by it and, on top of everything, has syphoned away the cream of the profits, not merely out of the documented economy but from the domestic economy itself. The combined
(liquid) wealth of these classes, together with members of a conniving officialdom is conservatively assessed at US $ 100 billion, reported conveniently to be deposited outside the country and in foreign banks. There is no tax culture in the country. What is worse, agricultural sector is not taxed at all.
So‑called land reforms of the Ayub and Bhutto eras, respectively, have been no more than a mere eye‑wash, lands remaining where they always were and landless haris, our version of serfs, undergoing a perpetual slavery, without education and without any means of their own. On top of all this
Shari'ah Courts having, only prospectively, declared compulsory and compensation‑free acquisition of property to be against the precepts of
Islam, the State, governed as it is, has conveniently construed the dicta as implying that even such land reforms, which have already been enacted, may not, in letter and spirit, be implemented. In a population of nearly 140 million hardly 2% pay taxes. The informal sector of the economy is as large, if not large, than the documented economy itself and probably, it is out of this documented economy that 13 % of the GDP, is villy nilly recovered as taxes, well below an average of above 29% of the realGDP realized in developed countries. As a direct consequence of these horrendous imbalances, nay perversions, the elite classes of Pakistan, including very substantially
Government officials in all fields of Government, semi‑Government or local activities, live almost princely lives. Nowhere in the world the elitist classes own, possess or live in such palatial accommodations as in Pakistan. A ready demonstration of the same malaise would instantaneously be at hand if one were merely to step out on a busy road in any major Pakistani city. Such an observer, inter alia (e.g., bazaars stocked largely of foreign goods), would find latest model luxurious automobiles plying in profusion. Correspondingly, there is hardly any worthwhile public transport on the roads, local trains are almost non‑existent and the elaborate railway system, which the British left behind, stands totally decimated. This is how the valuable resources
(monetary equivalent of GDP) of an empoverished country are , frittered 'away by those who matter here. It would not take a genius to visualize, in anticipation, the other side of the picture. As a corollary, the State of
Pakistan is not only poor but, as the argument goes, has degenerated into virtually a highly indebted poor country (HIPC). By conservative estimates, about half the budget of the nation, currently, goes in debt servicing and that together with defence and other expenditures constitutes 83 % of the total outlay, leaving thereby a bare 17 % for other activities, including health, education development etc. As one analyst, taking only the expenditure‑revenue ratio (deficit financing excluded) puts it, debt servicing and defence, put together, take away 120% of our budget. With illiteracy mounting by the hour, the population exploding and the country indebted, externally as well as internally, to a veritable chocking point, the present socio‑economic dispensation. has not only failed but stands all but collapsed. As against this, the simple Islamic system of profit and loss sharing, free of Riba, ensures for banks and financial institutions alike, direct say in the conduct of business and other ventures they finance on behalf of their clients
(depositors). The importance of this is self‑evident, where defaulted bank loans, by all accounts, have become astronomical and carry their own tales of dishonest application of credit. Where periodic performance reports to the financing bankers become a norm and where these bankers physically oversee the actual profits earned by the enterprises financed, something, which should be one of the inevitable incidents of the profit and loss sharing system, the economy would necessarily come to be documented, due profits would be distributed and, what is more, requisite taxes would be paid. In situations, where the entrepreneurs continue to indulge in the current and prevalent mal‑practices, their banker, upstaged as a vigilant partner in capital contribution, should catch the culprits sooner than later and forthwith choke any further such activities. Correspondingly, banks would contribute in capital mobilization not so much on the strength of collaterals as on the credit‑worthiness of the entrepreneurs and the viability of the venture(s), sought to be financed. With a system of proper checks and balances at all levels and a contemporaneous cleaning up of the existing mess, the economy is likely to soar is not too distant a future. All it would take is the required will and an unswerwing belief in the righteousness of the cause.
Even so, it is argued that a complete shift from a Riba based economy to an Islamic one is no ordinary task. Apart from gestation throes. there are apprehended to be pitfalls at every juncture of the transaction. The fears and apprehensions on this score, even if bona fide, stem from an assumption that the transaction would not only be swift but abrupt. Undoubtedly, it has to be swift if Allah's message has any meaning, but it need not be abrupt.
There can hardly be two opinions about the proposition that in commercial transactions, particularly of banks and financial institutions, it is rare that an advance, in good faith, is made without duly adverting to the economic feasibility of the venture, intended to be financed and without ensuring, in the way of collaterals, a virtual certainty of repayment. These, per se, a guarantee for a smooth transition, would, substantially, continue as the parameters within which Islamic Finance, essentially based on profit and loss sharing, would come to be extended, the only likely difference being a purposeful relaxation of the two considerations abovementioned, in a reasonable proportion, for those ventures, which are solely directed towards universal good and public welfare. The last, I repeat, shall only have to be in a reasonable proportion to purely commercially gainful activities anticipated to be pursued by banks and financial institutions in an interest ?free economy. Another, and again a largely beneficial difference, would be that finance for speculation, ostentatious pursuits and other ungainly activities would become scarce. Besides banks, because they would emerge as partners in business, would lose much of their existing role as creators of money, a circumstance, which has, in an unabated manner, continued to trigger an inflationary market. On the practical side, Islamisation of finance it may be added, is no longer a fanciful idea. For workable purposes, necessary documentation has already been accomplished. Fine tuning, if any, can take place within the visualized time schedule. As pointed out, in the main judgment and in his separate note ~ by my learned brother. Muhammad Taqi Usmani, J., Islamic banking is a physical reality all the world over and in so far as Pakistan is concerned we, specific to dealings having a nexus with financial institutions, at least on paper, have already ?gone completely Riba‑free. All that has to be done is to forsake appearances and follow the realities of the Islamic economic order, a prospect neither too difficult nor toe remote.
"If today Pakistan and so many other countries are in a state bordering perilously on financial bankruptcy, moral morass and environmental degradation, it is because of squalid governance, propped up largely by uncritical support and .instigation by powers on whose behalf the Bank and the Fund operate without any inhibition. The unrepresentative and anti‑people regimes have squandered aid and loans. Nowhere have the people been the beneficiary. At no stage were the people associated with these arrangements. There is no way the people can be held morally or even legally responsible to honour commitments behind such loans.
It is indeed good to see that the
Bank and the Fund are now moved by a sense of some sort of moral obligation (or remorse?) to relieve the distress of the heavily indebted poor countries.'
They should first try to see what are the benefits from their loans over the years that have filtered down to the people. Also, in what manner these loans have contributed to the prosperity out of which the process of repayment of the loans should start. They would also do themselves a deal of good if they try to see what link there is between the billions that the Bank and the Fund have so generously poured into the coffers of the Governments of what are now theheavily indebted poor countries'.
It is not unlikely that they find themselves confronted with the view that in one way or another the Fund and the Bank have wittingly or otherwise been an ally and privy to the regimes that have plundered their own people and drowned them into a sea of wretchedness that literally beggars description.
There are many who find themselves forced to the view that the Bank and the Fund have been instrumental in distorting the character and motivations of the nations in whose good name they have advanced money to usurpers, impostors and charlatans."‑
While negotiations for write off (in no case rescheduling because that, unceremoniously, multiplies the debt burden) would take their own time. a quick swipe may be directed at those, who illicitly hoard well over US $ 100 billion of our precious wealth abroad. Every bit of this money,? and when realised, should go for immediate clearance of the foreign debt, to the extent feasible at a given time. Correspond to this an end to living on undeserved imports. All luxury imports must forthwith cease There imports (dumping by veritable smugglers) have eroded our industrial base, factories have closed down. We are fast reverting to yet again becoming a raw material exporting country. Alas. with a dwindling agriculture, we may not be able to become even that. Enough of being a pliable market for others Private automobiles should he phased out in favour of public transport, both on intra and inter city basis. This should also ease our oil bill, already soaring beyond the $ 2.5 billion mark. Substantial export, and at that value added one, should be a priority area. No more smuggling. This too should be a significant foreign exchange saver. Land reforms of the Ayub and Bhutto eras need to duly enforced. There is no law against that. Agricultural produce, thus, induced, should even generally be encouraged. What a travesty, a basically agrarian, and once a wheat surplus country, is surviving on imported wheat. These and other cognate measures should generate a yearly surplus‑of at least US $ 3 to 4 billion. That too should exclusively go towards debt servicing. Where there is a will there is a way, the foregoing and other similar measures should, in God's good time, see us through our present plight of total helplessness.
Now to our bureaucratic quagmire. Bureaucratic corruption, of which the revenue staff and the police force are outstanding contributories, has, in all promptitude, to be rooted out in an Islamic policy. There is no dearth of exercises in this direction so far as the Islamic Republic is concerned. However, it remains a fact that all such were either half‑hearted measures, or substantially wanting in good faith and, in any case, inconclusive or selective. It is axiomatic that all local politics is about jobs. In Pakistan, by and large, these jobs are held, at every level, by either incompetent or dishonest or otherwise undeserving officials. On the other hand, better people are sitting out and remain jobless. In the current state of affairs, they have no chance! Every Government that comes reconciles itself with the incumbents, who soon establish their indispensability. It yet callously induct its own camp followers, adding to the burden of the exchequer, which, for all intents and purposes has gone bankrupt. Talking of bankruptcy, from the material, which has been produced before us virtually all Pakistani banks are in doldrums, presenting a totally moth eaten interior and there is little doubt that if the depositors, who are in millions, were merely to cease making further deposits in Pakistani banks, such banks and their hand‑picked (defaulting) agrarian, 'commercial and industrial entrepreneurs would be left with nothing else except to prey upon one another's vitals. A very serious exercise to correct these imbalances is over?due. There is no need for witch hunting. All bureaucrats, as inclusive of bankers, should be required to submit details of assets owned or possessed by them, by members of their immediate families etc. and wherever such are, inexplicably, more than would be warranted necessary action should follow including compulsory or optional retirements. Correspondingly, all institutions, as have any nexus with properties, their allotments or transfers, banks, financial institutions or other connected entities may be required to provide details of individual and corporate holdings with which the above declarations of assets may be matched and discrepancies, if any, not only corrected but also penalised. Another link of the same exercise would lie in requiring similar compliances from the agrarian, commercial or industrial sections of the society, but of specific categories. The data, synchronised, thus, would lead to necessary remedial measures. Of particular importance is the matter of bringing back the above US $ 100 billion, belonging to Pakistanis and stated illegally to be parked abroad. Given the necessary will and resolve, there can be many ways to do it. First and foremost is to institute adequate awards, with corresponding secrecy, for would be informers. Then foreign Governments/lenders may be persuaded to cooperate with a firm commitment to clear their liabilities on priority basis, once necessary material to trace and recover evaded assets is made available. Last but not the least, tax and other incentives may be offered to the evaders themselves to restitute the valuable national wealth. This, and other moneys, realised sooner than later, should be utilised in paying off the foreign debt and the domestic liabilities of the country in that order. In laying down these guidelines, it is proposed to exclude the judicial segment of the State. An identical exercise can go on in the provinces at and below the levels of the High Courts and at the Federal level in the Supreme Court. Much as, basically, the cleaning up of the officials would be at the bureaucratic level itself, the cleaning up of the judiciary shall have to be by and under the members of the judiciary themselves. Neither politicians nor the armed forces should be immune from these exercises. The politicians would be covered, apparently, under the categories of agrarian, commercial or industrial classes, abovementioned and, if necessary, a separate dispensation. regarding them also can be worked out but the corrective machinery, as regards participation of their peers, should only comprise of political figures of high integrity and impeccable characters. As regards the armed forces the exercise can be internal but transparent and open to public view. Relevant to the tribunals of exclusive jurisdiction, which such matters should necessitate, two things must be ensured. One, these should be manned only by sitting and retired Judges of high integrity and two, the appointees should exclusive attend to these special assignments and for looking after their normal duties, if serving Judges are assigned these functions, temporary or other vacancies of their posts be created. Under no circumstances any direct appointment to these tribunals be made because such has never delivered. It is only from within the system that something good may yet come.
Having expressed general agreement with the findings and conclusions of my learned brothers together with some explicit of implicit reservations I would here before concluding, like to make an express mention of some matters:‑‑‑
(i)???????? With respect, the finding, that Riba al‑Fadl was not envisioned in i the Qur'an and introduced, for the first time, by the Prophet of Islam appears, both factually and historically, to be ill‑founded. As dilated upon above, the concept had, broadly, found a place in the Old Testament and besides, Arabs of the time physically indulged in Riba al‑Fadl, as the quoted Ahadis of Bilal (r.a.a.), and the Prophet's (s.a.a.w.s.) representative at Khyber would tend to demonstrate. Thus, the Qur'an cannot be assumed to have ignored either the previous relevations in the Scripture or the facts on the ground. Prophet (s.a.a.w.s.), nonetheless, has been fully credited with articulating and perfecting the institution of Riba al‑Fadl. Even so, the views of my learned brothers may not make any particular difference because, after the Qur'an, Sunnah is the most important source of Muslim Law and the Prophet (s.a.a.w.s.) never discriminated in the import or effect of either form of Riba. Thus, whatever be the rationale Riba al‑Fadl would remain as much prohibited for Muslims as Riba al‑Nasi'ah.
(ii)??????? In my humble opinion, Government, and particularly ran Islamic Government, cannot be differentiated in the way of so‑called "voluntary" additions and all such increases, upon the touchstone of Qur'an and Sunnah constitute nothing but Riba. Furthermore, in so far as law‑making touching the relevant Consolidated Funds and Public Accounts are concerned two aspects need be under‑scored:‑‑
(a)??????? In the absence of due fulfilment of the Constitutional requirement to provide necessary framework on the point all debt raising loses legal sanctity.
(b)??????? After our declarations qua Riba no law can now be framed, regulating Riba‑infested barrowing by Government. Borrowing has now to be Riba‑free and only if absolutely necessary, for Islam does not sanction any other form of borrowing.
(iii)?????? Evidently, the objective behind some of the affirmative observations, regarding the "mark‑up" system, is merely to sanction trading, upon duly and fully complying with the concepts of Bai Mu'ajjal and Marabaha sale, each observing the caution, administered by the Holy Prophet (s.a.a.w.s.) of physical delivery of the goods sold.
(iv)?????? As regards the Shariah compliant modes and instruments of finance let it be noted that, such already stand, very largely, developed. No unnecessary time should, therefore, be lost in that direction nor banks and other financial institutions should, in any manner, delay the due implementation of a Riba‑free and profit and loss‑oriented Islamic system.
(v)??????? I have reservations about the time schedule, adopted in the Order of the Court. Besides, there are some lacunas in it. In my humble opinion comparatively smaller periods would have been sufficient. Any way, consensus, in essentials, is a prerequisite in such delicate matters and such is reflected in the Order of the Court. Having said that there should be no misgivings in any quarters that this or the Federal Shariat Court would brook any unnecessary delay during the implementation phase of the judgment of this Court. Thus, time schedule or not, no one, be it the Government itself, would any longer be countenanced to conduct any further avoidable Ribawi dealings, here or with the outside world. Transgressions, if any, can be appropriately brought to the notice of the Court.
(vi)?????? Lastly, there are some aspects of the matter e.g., inflation/indexation and the argument of Mr. M. Aslam Khaki regarding the lawfulness or otherwise of a fixed (percentage) payment to the contributor of capital, subject to accrual of profits from a venture, on which I would like to reserve my opinion for a more appropriate time and occasion. For one thing, a true Islamic economy should necessarily be inflation‑free and, as to Mr. Khaki's contention there are plenty of Islamic modes of finance to justify indulging; at this stage, in merely academic discussions.
??????????? (Sd.)
Justice Wajihuddin Ahmed, Member
JUDGMENT
JUSTICE MAULANA MUHAMMAD TAQI USMANI (MEMBER).‑‑‑All these appeals arise out of the same judgment of the learned Federal Shariat Court dated 14‑11‑1991 whereby the Court has declared a number of laws of the country repugnant to the Injunctions of Islam as they have provided for charging or paying interest which according to the findings of the learned Federal Shariat Court falls within the definition of Riba clearly prohibited by the Holy Qur'an.
The basic issues involved in all these appeals being similar all of them were heard together and are being disposed of by this single judgment.
Most of the appellants as well as some jurisconsults argued before us that interest‑based commercial transactions are invented by the modern business, and their history does not refer back to more than 400 years, therefore, they are not covered by the term `Riba' used by the Holy Qur'an, and the prohibition of Riba does not include the prohibition of interest as in vogue in modern transactions.
4.???????? This view is sought to be supported by five different lines of argument adopted before us against the prohibition of interest.
The first approach to interpret the term Riba, as adopted by some of the appellants, was that the verses of the. Holy Qur'an which prohibit Riba were revealed in the last days of the life of the Holy Prophet (p.b.u.h.) and he could not have an opportunity to interpret them properly, and therefore, no hard and fast definition of the term Riba can be found in the Holy Qur'an or in the Sunnah of the Holy Prophet (p.b u.h.). Since the term remained ambiguous in nature. it falls within the area of Mutashabihaat and its correct meaning is unknown. According to this approach the prohibition of Riba should he restricted to the limited transactions expressly mentioned in the Hadith literature and the principle cannot be extended to the modern banking system which was not even imaginable at the time of revelation of the verses.
The second line of argument runs on the basis that the word 'Riba' refers only to the usurious loans on which an excessive rate of interest used to be charged by the creditors which would entail exploitation. As for the modern banking interest; it cannot be termed as `Riba' if the rate of interest is not excessive or exploitative.
The third argument differentiates between consumption loans and commercial loans. According to.
this approach the word "AI‑Riba" used in the Holy Qur'an is restricted to the increased amount charged on the consumption loans used to be taken by the poor people for their day to day needs. These poor people deserved sympathetic attitude on humanitarian grounds, but the rich people exploited their miserable condition to charge heavy amounts from them in the form of usury. The Holy Qur'an has taken this practice as a severe offence against humanity and declared war against those involved in such abominated transactions. So far as the modern commercial loans are concerned, they were neither in vogue in the days of the Holy Prophet (p.b.u.h.) nor has the Holy
Qur'an addressed them while prohibiting Riba'. . Even the basic philosophy underlying the prohibition ofRiba' cannot be applied to these commercial and productive loans where the debtors are not poor people. In most cases they are wealthy or at least economically well‑off and the loans taken by them are generally used for generating profits. Theref6re, any increase charged from them by the creditors cannot be termed as Zulm' (injustice) which was the basic cause of the prohibition ofRiba'.
The fourth theory advanced during the arguments was that the Holy Qur'an has prohibited Riba‑al‑Jahiliyya' only, which, according to a number of traditions, was a particular transaction of loan where no additional amount over and above the principal was stipulated in the agreement of loan. However, if the debtor could not pay off the loan at its due date, the creditor would give him more time against charging an additional amount. According to this theory, if an increased amount is stipulated in the initial agreement of loan, it does not constitute Riba al‑Qur'an.
However, it does fall in the definition of Riha‑al‑Fadl, prohibited by the Sunnah. Its prohibition is of a lesser degree which can be termed as
Makrooh and not Haram . Therefore, this prohibition may be relaxed in cases of genuine need and it does riot apply to the non‑Muslims. Being a special law applicable to the Muslims only, it falls within the category ofMuslim
Personal Law' which falls outside the jurisdiction of the Federal Shariat
Court, as contemplated in Article 203‑B of the Constitution of Pakistan.
The fifth way of argument was that although the modern interest? based transactions are covered by the prohibition of `Riba', yet the commercial interest being the back‑bone of the modern economic activities throughout the world, no country can live without being involved in interest? based transactions and it will be a suicidal act to abolish interest from domestic and foreign transactions. Islam, being a practical religion, recognizes the principle of necessity and it has allowed even to eat pork in extreme situation where one cannot live without eating it. The same principle of necessity should be applied to the interest‑based transactions also, and on the basis of this necessity the laws permitting the charge of interest should not be declared repugnant to the Injunctions of Islam.
All these different sets of arguments led us to resolve the main issue i.e. whether ox not commercial interest of modern financial system falls W14bjn the definition of Riba prohibited by the Holy Qur,an, and if it does, whether they can be allowed on the basis of necessity. This also led us to examine whether ?the modern financial transactions‑ can be designed without interest and whether or not the proposed alternatives .are feasible keeping in view the modern structure of commerce and finance. In order to resolve these issues we invited a number of experts as juris consults consisting of Shariah Scholars, economists, bankers, accountants and representatives of modern business and trade who have provided assistance to the Court in their respective areas of specialization.
An objective study of the Qur'anic verses dealing with Riba
Before analysing the abovementioned arguments, let us undertake an objective study of the verses of the Holy Qur'an about Riba. A There are four different sets 6f verses which were revealed on different occasions.
First, in Surah Al‑Rum (30:39), a Makkan Surah wherein the term Riba finds mention in the following words:
(And whatever Riba you give so that it may increase in the wealth of the people, it does not increase with Allah. )[30:39]
(And because of their charging Riba while they were prohibited from it)[4:161]
(O those who believe do not eat up Riba doubled and redoubled)
"Those who take Riba (usury or interest) will not stand but as I stands the one whom the demon has driven crazy by his touch That is because they have said: "Trading is but like Riba". And Allah has permitted trading, and prohibited Riba. So, whoever receives an advice from his Lord and stops, he is allowed what has passed, and his matter is up to Allah. And the ones who revert back, those are the people of Fire. There they remain for ever.
Allah destroys Riba and nourishes charities. And Allah does not like any sinful disbeliever. Surely those who believe and do good deeds, establish Salah and pay Zakah, have their reward with their Lord, and there is no fear for them, nor shall they grieve.
O those who believe, fear Allah and give up. what still remains of the `Riba' if you are believers. But if you do not, then listen to the declaration of war from Allah and His Messenger. And if you repent, yours is your principal. Neither you wrong, nor be wronged. And if there be one in misery, then deferment till ease. And that you leave it as alms is far better for you, if you really know. And be fearful of a day when you shall be returned to Allah, then everybody shall be paid, in full, what he has earned. And they shall not be wronged'.
(Verses 275‑‑281)
Historical Analysis of the Verses of Riba
Surah al‑Rum
Surah al‑Nisa
("The People of the Book ask you to bring down upon them a Book from the heaven".)
Surah Al‑Imran:
The third verse is of Surah Al‑lmran which is estimated to have been revealed sometime in the 2nd year after Hijra, because the context of the preceding and succeeding verses refers to the‑ Battle of Uhud which took place in the 2nd year after Hijra. This verse contains a clear prohibition for the Muslims and it can safely be said that it is the first verse of the Holy Qur'an through which the practice of Riba was forbidden for the Muslims in express terms. That is why Hafidh Ibn Hajar Al‑Asqalani, the most famous commentator of Sahih AlBukhari, has opined that the prohibition of Riba was declared sometime around the Battle of Uhud.' Some commentators have also pointed out the reason why this verse was revealed in the context of the Battle of Uhud. They say that the invaders of Makkah had financed their army by taking usurious loans and had in this way arranged a lot of arms against, Muslims. It was apprehended that it may induce the Muslims to arrange for arms on the same pattern by taking usurious loans from the people. In order to prevent them from this approach the verse was revealed containing a clear‑cut prohibition of Riba.
That the prohibition of Riba had been imposed sometime around the Battle of Uhud finds further support from an event reported by Abu Dawood in his Al‑Sunan from the noble companion, Abu Huraira (r.a.a.). The report says that Amr ibn Aqyash was a person who had advanced some loans on the basis of interest. He was inclined to embrace Islam but was reluctant to do so on the apprehension that after embracing Islam he would lose the amount of interest, and therefore, he delayed accepting Islam. In the meantime the Battle of Uhud broke up whereby he decided not to delay embracing Islam and came to the battlefield, started fighting on behalf of Muslims and achieved the rank of a Shaheed (martyr) in the same battle.'
This tradition clearly shows that Riba was prohibited before the Battle of Uhud and it was the basic cause for the reluctance of Amr ibn Aqyash to embrace Islam.
The fourth set of verses are contained in Surah Al‑Baqara where the severity of the prohibition of Riba has been elaborated in detail. The background of the revelation of these verses is that after the conquest of Makkah the Holy Prophet (p.b.u.h.) had declared as void all the amounts of Riba that were due at that time. The declaration embodied that nobody could claim any interest on any loan advanced by him. Then the Holy Prophet (p.b.u.h.) proceeded to Taif which could not be conquered, but later on the inhabitants of Taaif who belonged mostly to the tribe of Thaqif came to him and after embracing Islam surrendered to the Holy Prophet (p.b.u.h.) and entered into a treaty with him.' One of the proposed clauses of treaty was that Banu Thaqif will not f9rego the amounts of interest due on their debtors but their creditors will forego the amount of interest. The Holy Prophet (p.b.u.h.) instead of signing that treaty simply wrote a sentence on the proposed draft that Banu Thaqif will have the same rights as the Muslims have.' Banu Thaqif having the impression that their proposed treaty was accepted by the Holy Prophet (p.b.u.h.) claimed the amount of interest from Banu Amr Ibn‑al‑Mughirah, but they declined to pay interest on the ground that Riba was prohibited after Islam. The matter was placed before Attaab ibn Aseed (r.a.a.), the Governor of Makkah. Banu Thaqif argued that according to the treaty they are not bound to forego the amounts of interest. Attaab ibn Aseed, (r.a:a.), placed the matter before the Holy Prophet (p.b.u.h.) on which the following verses of Surah AI‑Baqarah were revealed:
(O those who believe, fear Allah and give up what still remains of the Riba if you are believers. But if you do not, then listen to the declaration of war from Allah and His Messenger. And if you repent, yours is your principal. Neither you wrong, nor be wronged. [278‑279])
The Time of Prohibition of Riba
This study of the verses of the Holy Qur'an in the light of their historical background clearly proves‑that, Riba was prohibited at least in the 2nd year of Hijra. It is rather doubtful whether or not it was prohibited before that. If the word Riba in the verses of Surah Al‑Rum is taken to mean usury as interpreted by a number of authorities, it would mean that the practice of Riba was discarded by the Holy Qur'an in Makkan period. That is ‑ why a number of scholars are of the view that Riba was never allowed in Islam. It was prohibited from the very beginning but the severity of prohibition was not emphasized during that period because Muslims were being persecuted by the infidels of Makkah and their major focus was on establishing and defending the basic articles of faith and they had no occasion to indulge in the practice of Riba. Be that as it may, the fact that cannot be denied is that the express prohibition of Riba was undoubtedly imposed in the 2nd year of Hijra.
Some appellants and juris consults have assailed this statement and urged that the prohibition of Riba was imposed in the last year of the life of the Holy Prophet (p.b.u.h.). They tried to support this view on three different traditions:
Firstly, it has been reported in a number of traditions that the Holy Prophet (p.b.u.h.) announced the prohibition of Riba in his last sermon during his last Hajj. The Holy Prophet (p.b.u.h.) not only prohibited Riba on that occasion but had also declared that the first Riba decreed to be void, is the Riba payable to his uncle Abbas ibn Abdul Muttalib (r.a.a.). This declaration shows that the first transaction declared to be void was that of Abbas ibn Abdul Muttalib (r.a.a.), which means that the prohibition of Riba was not effective. before the last Hajj of the Holy Prophet (p.b.u.h.) i.e. before 10th year after Hijra.
A deeper study of the relevant material reveals that this argument is misconceived. In fact the prohibition of Riba was effective at least from the 2nd year of Hijra but the Holy Prophet (p.b.u.h.) deemed it necessary to announce the basic injunctions of Islam at the time of his last sermon which was ‑the most attended gathering of his followers. To avail this opportunity, he announced the prohibition of a large number of practices prevalent in the days of Jahiliyya which were prohibited in Islam, but it did never mean that these practices were not prohibited before that point of time. For example, the Holy Prophet (p.b.u.h.) has emphasized on the sanctity of human lire and honour. He announced the prohibition of liquor and warned the Muslims against maltreatment of women, against back‑biting and mutual quarrels. Obviously all these injunctions were effective since long, but the Holy Prophet (p.b.u.h.) announced them at the time of his last sermon so that all the audience may be fully aware of them and nobody could plead ignorance about these injunctions. The same is true about Riba. It was prohibited since long, but the announcement of its prohibition was repeated in express terms on that occasion also. At the same time the Holy Prophet (p.b.u.h.) declared that no claim of Riba will be entertained forthwith. It was a time when large number of Arab tribes were entering the fold of Islam throughout the peninsula. The practice of Riba was rampant among them and it was apprehended that they would continue claiming the amounts of usury from one another, therefore, the Holy Prophet (p.b.u.h.) deemed it fit to announce not only the prohibition of Riba but also that all the previous transactions of Riba will no more be honoured. It was in this context that he declared the amounts of Riba payable to his uncle Abbas‑ibn‑Abd‑ul?Muttalib (r.a.a.), as void. It should be kept in mind that his uncle Abbas (r.a.a.) embraced Islam in 8th year after Hijra shortly before the conquest of Makkah Before embracing Islam he used to advance loans on the basis of interest and his debtors owed him huge amounts.' It seems that after the conquest of Makkah he migrated to Madina and could not settle his transactions with his debtors. Therefore, when he travelled for Hajj along with Holy Prophet (p.b.u.h.), it was the first occasion when he could Settle his transactions, hence, the Holy Prophet (p.b.u.h.) declared that the whole amount of Riba payable to his uncle Abbas (r.a.a.), was void and no more payable. The words first Riba occurring in this declaration do not mean that no Riba was declared void before it. What it means is simply that this is the first amount of Riba which is being declared as void at that occasion of the last sermon. We have already quoted the case of Banu Thaqeef who demanded interest from their debtors after the conquest of Makkah (i.e. two years before the last Hajj) and the amounts of interest claimed by them were held to be void. It is, therefore, not correct to say that the Riba of Abbas b. Abdulmuttalib (r.a.a.), was the first ever Riba which was declared void, nor that the prohibition of Riba was enforced for the first time at the time of last Hajj.
The Last Verse of the Holy Our'an
(The last verse of the Holy Qur'an which was revealed on the Holy Prophet (p.b.u.h.) was the verse of Riba )
Therefore even if the above statement of Abdullah ibn Abbas (r.a.a) is taken at its face value it is an admission on his own part that the verses of Surah Al-Nisa and Surah Al-Rum were revealed before this verse of Surah Al-Baqarah which clearly indicated that the prohibition of Riba was already imposed before the revelation of these verses. It is therefore evident that this statement of Abdullah-ibn-Abbas (r.a.a.0 cannot be taken to mean that prohibition of Riba was imosed in the last days of the life of the Holy Prophet (p.b.u.h.)
31.Moreover? the same statement of Abdullah-ibn-Abbas (r.a.a) is reported by a number of other scholars like Ibn jarir Al-tabari who have explained that this statement of Abdullah‑ibn‑Abbas (r.a.a.), refers only to the following verse:
(And be fearful of a day when you shall be returned to Allah, then everybody shall be paid, in full, what he has earned. And they shall not be wronged. [v.2:281] )
Since this verse is placed in the present order immediately after the verses of Riba which are 275‑‑280, Abdullah‑ibn‑Abbas (r.a.a.) has termed it as a verse of Riba. That is why Imam Bukhari has related this statement of Abdullah‑ibn‑Abbas (r.a.a.) in that chapter of his Katab‑al‑Tafseer which deals with the commentary on verse 281 only and not in the Chapters 49‑‑52 which deal with verses 275‑‑280 Ibn Hajar: Fathul Bari, Vol.8, p.205". In the light of this explanation, it is more probable that according to Abdullah‑ibn‑Abbas (r.a.a.) the verses mentioning the severity of the prohibition of Riba (verses 275‑280 of Surah Al‑Baqara) were already revealed and it was only verse 281 which was revealed in the last days of the Holy Prophet (p.b.u.h.). This view finds further support from the fact that verse 278 was certainly revealed soon after the Conquest of Makkah when the tribe of Thaqif had claimed the amount of Riba outstanding toward Banu Mughira as already mentioned in detail. The Conquest of Makkah was in 8th year of Hijra while the Holy Prophet (p.b.u.h.) passed away in 11th of Hijra. How can it be imagined that no other verse of Holy Qur'an was revealed during this long period of more than 3 years. This presumption which is false on the face of it is very difficult to be attributed to a person like Abdullah‑ibn‑Abbas (r.a.a.). It is, therefore, almost certain that by the verse of Riba he did not mean any other verse than verse 281 which according to him was revealed separately in the last days of the Holy Prophet (p.b.u.h.) and this too is the personal opinion of Abdullah‑ibn‑Abbas (r.a.a.). Some other Sahaba have identified some other verses of the Holy Qur'an as being the last revealed verses. The issue has been discussed in detail by Al‑Suyyuti in his Al‑Itqan and many other books of Tafseer and Hadith.
This explanation is more than sufficient to prove that the prohibition of Riba was imposed long before the last days of the Holy Prophet (p. b. u. h.).
The upshot of the above discussion is that although some indications of displeasure against Riba were given in the Makkan period also, but the express prohibition of Riba was revealed in the Holy Qur'an sometime around the battle of Uhud in the second year of Hijra.
The third tradition relied upon by some appellants for their claim B that the prohibition of Riba came in the last days of the Holy Prophet (p.b.u.h.) is a statement of Hazrat Umar (r.a.a.). We shall analyze this statement later on in para. 56 in a greater detail Inshaallah.
What is meant by Riba?
Riba in the Bible:
"Thou shalt not lend upon usury to thy brother; usury of money, usury of victuals, usury of anything that is lent upon usury." [Deuteronomy 23:19]
"Lard, who shall abide in thy tabernacle? Who shall dwell in thy holy hill? He that walketh uprightly, and worketh righteousness and speaketh the truth in his heart. He that putteth not out of his money to usury, nor taketh reward against the innocent." [Psalms 15:1,2,5]
"He that by usury and unjust gain increaseth his substance, he shall gather it for him that will pity the poor". [Proverbs 28:8]
"Then I consulted with myself, and I rebuked the nobles, and rules and said unto them, Ye exact usury, every one of his brother. And I set a great assembly against them." [Nehemiah 5:7]
"He that hath not given forth upon usury, neither hath taken any increase,, that hath withdrawn his hand from inequity, hath executed true judgment between man and man, Hath walked in my statues, and hath kept my judgments, to deal truly; he is just,.
He shall surely live, said the Lord God. [Ezekiel 18:8,9].
In thee have they taken gifts to shed blood; thou hast taken usury and increase, and though hast greedily gained of thy neighbours by extortion, and hast forgotten me, said the Lord God, [Ezekiel 22:12].
The definition of Riba as given by the Exegetes of the Holy Our'an:
39.?????? Moreover, the literature of Hadith while explaining the word "Riba " has mentioned in detail the transactions of Riba which were used to be effected by the Arabs of Jahiliyya on the basis of which the earliest commentators of the Holy Qur'an have defined Riba in clear terms.
And the Riba which was known to and practised by the Arabs was that they used to advance loan in the form of Dirham (silver coin) or Dinar (gold coin) for a certain term with an agreed increase on the amount of the principal advanced.
The Riba of Jahiliyya is a loan given for stipulated period with a stipulated increase on the principal payable by the loanee."
As for the Riba Al‑Nasi'ah, it was a transaction well‑known and recognized in the days of Jahiliya i.e. they used to give money with a condition that they will charge a particular amount monthly and the principal will remain due as it is. Then on the maturity date they demanded the debtor to pay the principal. If he could not pay, they would increase the term and the payable amount. So, it was the Riba practised by the people of Jahiliya." AI‑Tafseer AI‑Kabeer by AI‑Raazi, p.91, Vo1.7, published in Teheran
The Detailed Account of Riba‑al‑Jahilivva
Mr. Riazul Hassan Gillani, the learned counsel for the Federation of Pakistan argued before us that Riba Al‑Jahiliyya which was prohibited by the Holy Qur'an was a particular transaction in which no increase used to be stipulated at the time of advancing a loan; however, if the debtor .could not pay the principal amount at the time of maturity, the creditor used to offer him two options: either to pay the principal or to increase the amount in exchange of an additional term allowed by the creditor. The learned counsel argued that the original loan advanced in the days of Jahiliyya would not stipulate any additional amount in the principal, and therefore, any amount stipulated in the original contract of loan does not fall within the definition of Riba al‑Qur'an. However, it may fall in the definition of Riba‑al‑Fadl which is a Makruh (detested, not advisable) practice.
The learned counsel referred to a number of traditions narrated by the exegetes of the Holy Qur'an. For example, he cited the well‑known Tafseer of Ibn Jarrir AlTabari who on the authority of Mujahid has explained the Riba of Jahiliya as follows:
In the days of Jahiliyya a person used to owe a debt to his creditor then he would say to his creditor "I offer you such and such amount and you give me more time to pay.
The same explanation has been given by a number of commentators of the Holy Qur'an. Mr. Riazul Hassan Gillani argued that there is no mention in these traditions of any increase on the principal stipulated in the original transaction of loan. What is mentioned here is that the increase used to be offered or claimed at the time of maturity which shows that Riba prohibited by the Holy Qur'an was restricted to claiming an amount for giving an additional time to the debtor. If an increased amount is stipulated in the initial transaction of loan, it is not covered by Riba‑al‑Qur'an.
This contention of the learned counsel did not appeal us at all, for the simple reason that a careful study of the relevant material in the original resources of Tafseer clearly shows that the claim of an increased amount over the principal had different forms in the days of Jahiliyya. Firstly, while advancing a loan the creditor used to claim an increased amount over the principal and would advance loan on this clearly stipulated condition as G is mentioned by Imam Al‑Jassas in his Ahkamul Qur'an already quoted above; secondly, the creditor used to charge a monthly return from the debtor while the principal amount would remain intact up to the day of maturity as mentioned by Imam Al‑Raazi and Ibn Aadil already quoted.
The third form is mentioned by Mujahid as quoted by the learned counsel, but the full explanation of this transaction is given by Ibn Jarrir himself on the authority of Qatadah in the following words:
"The Riba of Jahiliyya was a transaction whereby a person used to sell a commodity for a price payable at a future specific date, thereafter when the date of payment came and the buyer was not able to pay, the seller used to increase the amount due and give him more time."
?48. The same explanation has been given by Alsuyitti on the authority of Faryabi in the following words:
They used to purchase a commodity on the basis of deferred payment, then on the date of maturity the sellers used to increase the due amount and increase the time of payment."
??????????? 49. It is clear from these quotations that the transaction in which the creditor used to charge an additional amount on the date of maturity was not a transaction of loan. Initially, it used to be a transaction of sale of a commodity on deferred payment basis in which the seller used to fix a higher price because of deferred payment, but when the buyer would not pay at the date of maturity; the seller used to keep on increasing the amount in exchange of additional time given to the buyer. This particular transaction is meant by Mujahid also, that is why, he did not use the word Qarz (loan); he has rather used the word Dain (debt) which is normally created by a transaction of sale.
??????????? 50. This form of Riba has been frequently mentioned by the commentators of the Holy Qur'an because they wanted to explain a particular sentence of the verses of Riba which is as follows:
The non-believers say that sale is very similar to Riba.
??????????? 51. This saying of the non-believers clearly refers to the particular transaction of sale mentioned above. Their objection was that when we increase the price of commodity in the original transaction of sale because of its being based on deferred payment, it is treated as a valid sale. But when we want to increase the due amount after the maturity date, when the debtor is not able to pay, it is termed as Riba while the increase in both cases seems to be similar. This objection of the non-believers of Makkah has been specifically mentioned by the famous commentator Ibn Abi Hatim on the authority of Said ibn Jubair:
They used to say that it is all equal whether we increase the price in the beginning of the sale, or we increase it at the time of maturity. Both are equal. It is this objection which has been referred to in the verse by saying "They say that the sale is very similar to Riba. ""
??????????? 52. The same explanation is given in Al-bahr Al-Muheet by Abu Hayyan and several other original commentators of the Holy Qur'an.
??????????? 53. It clearly shows that the practice of increase at the time of maturity relates to two situations: firstly, a situation where the original transaction was that of sale of a commodity as mentioned by Qatadah, Faryabi, Saeed Ibn Jubair etc. and the second situation was where the original transaction was that of a -loan whereby monthly interest used to be charged by the creditor and the principal amount used to remain intact until the date of maturity, and if the debtor would not pay the principal at that point of time, the creditor used to increase the due amount on the principal in exchange of further time given to debtor as mentioned by Imam Raazi and Ibn Aadil etc. already quoted in paras. 42 and 43 above.
??????????? 54. It is, thus, established that the Riba prohibited by the Holy Qur'an was not confined to the transaction referred to by Mr. Riazul Hassan Gillani, the learned. counsel' for the Federation of Pakistan. It had different forms which all were practised by the Arabs of Jahiliyya. The common feature of all these transactions is that an increased amount was charged on the principal amount of a debt. At times this debt was created through a transaction of sale and some time it was created through a loan. Similarly the increased amount was at times charged on monthly basis, while the principal was to be paid at a stipulated date, and some time it was charged along with the principal. All these forms used to be called Riba because the lexical meaning of the term is `increase'. That is why, the commentators of the Holy Qur'an like Imam Abubakr Al-Jassas have defined the term in the following words:
??????????? The Riba of Jahiliyya is a loan given for a stipulated period against increase on the principal payable by the loanee.
??????????? 55. Now we come to the different arguments advanced before us against the prohibition of the modern interest.
The Statement of Hazrat Umar about the ambiguity in the concept of Riba:
??????????? 56. Mr. Abu Bakr Chundrigar, the learned counsel for Habib Bank Ltd. placed his reliance on an article written~by Mr. Justice (late) Qadeeruddin Ahmed which appeared in daily Dawn, dated 12th August, 1994. In this article the late Justice Qadeeruddin Ahmed contended that the term Riba as used in the Holy Qur'an is an ambiguous term, correct meaning of which' was not understood even by some companions -of the Holy Prophet (p.b.u.h.). He referred to the statement of Hazrat Umar (r.a.a.), that the verses of Riba were among the "last verses of the Holy Qur'an and the Holy Prophet (p.b.u.h.) 'passed away before he could explain them to us, therefore, avoid Riba and everything which is doubtful". The same argument has been adopted by a number of appellants in their memos of appeal so much so that some of the appellants have termed the verses of Riba as Mutashabihaat (the verses having ambiguity or confusion in their meaning). They argued that the Holy Qura'n has asked us to follow only those verses which are clear in meaning (Muhkamaat) and not to follow Mutashabihaat. The verses of Riba being of the second category, according to the appellants, they are not practicable.
A description of Riba al‑Fadl
Gold for gold, silver for silver, wheat for wheat, barley for barley, date for date, salt for salt, must be equal on both sides and hand to hand. Whoever pays more or demands more (on either side) indulges in Riba."
It means that if wheat is exchanged for wheat, the quantity on both sides must be equal to each other and if the quantity of any one side is more" or less than the other, this transaction is also a Riba transaction, because in N the tribal system of Arab these commodities were used as money, and the exchange of one kilogram of wheat for one and a half (1 ?) kilogram of another wheat would stand for the exchange of one dirham for one and a half (1 ?) dirhams. However, this transaction was termed as Riba by the Holy Prophet, (p.b.u.h.), and it was not meant by the .
term Riba Al?JahiliYya'. Therefore, it was known asRiba al‑Fadl' or
`Riba‑al‑Sunnah'.
It is to be noted that, while prohibiting the Riba al‑Fadl, the Roly Prophet (p. b. u. h.) has identified only six commodities and it was not. clearly mentioned in the above hadith whether this rule is limited to these six commodities or it is applicable to some other commodities as well, and in the latter case what are those commodities? This question raised controversy among the Muslim jurists. Some earlier jurists, like Qatadah and Tawoos, restricted this rule to these six commodities only, while. the other jurists were of the opinion that the rule will be extended to other commodities of the same nature. Then there was a difference of opinion about the nature of these commodities that might be taken as a common feature found in all the six commodities and a criterion for identifying the commodities which are subject to the same rule. Imam Abu Hanifa and Imam Ahmad are of the opinion that the common feature of these six commodities is that they can either be weighed or measured, therefore, any commodity which is sold by weighing or measuring falls within this category and is subject to the same rule, if it is bartered with a similar commodity. Imam Al‑Shafie is of the view that the common feature of these six commodities is that they are either eatables or they are used as a universal legal tender. Wheat, barley, date, salt represent eatables while gold and silver represent universal legal tenders. Therefore, according to Imam Al?Shafie all eatables and universal legal tenders are subject to the rule mentioned in the Hadith. Imam Maalik is of the opinion that the common feature among these six commodities is that they are either food items or they can be stored, therefore, he holds that everything which falls under the food items or can be stored is included in the same category, hence, subject to the same rule."
This difference of opinion among the Muslim jurists was based on the fact that after specifying the six commodities the Holy Prophet (p.b.u.h.) did not expressly mention whether or not other commodities will assume the same status.
The correct meaning of Hadrat Umar's Statement
There are three things about which I wished that the Holy Prophet (p.b.u.h.) aid not leave us before explaining them to us in detail: the inheritance of grandfather and the inheritance of Kalalah (a person who has left neither a father nor a son) and some issues relating to Riba.
You think that we do not know about any issue from the issues of Riba and no doubt I would love to know all these issues more than I would like to own a country like Egypt with all its habitations ‑but there are many issues (about Riba) which cannot be unknown to any one e.g. purchasing gold for silver on deferred payment basis and purchasing the fruits on the tree while they are yellow and did not reap (in exchange of similar fruits without weighing theme' ).
64, These narrations of the statement of Hazrat Umar (r.a.a.), clearly reveal two points: firstly, that all his concern in the issues of Riba related to Riba al‑Fadl and not to Riba Al‑Nasi'ah which was prohibited by the Holy Qur'an, and secondly, that even in the issue of Riba Al‑Fadl he did not feel difficulty in many transactions which were clearly prohibited, however, he was doubtful only with regard to some transactions which were not expressly mentioned in the relevant hadith or in any other saying of the Holy Prophet (p.b.u.h.).
Productive or Consumption Loans
Another argument advanced by some appellants was that the Holy Qur'an had prohibited to claim any increase over and above the principal in the case of consumption loans only, where the borrowers used to be poor persons borrowing money to meet their day to day needs of food and clothes etc. Since no productive loans were in vogue in the days of Holy Prophet (p.b.u.h.) it was not contemplated by the verse of Riba to prohibit a charge on the commercial and productive loans. Otherwise also, they argued, it is injustice to claim any additional amount on the principal from a poor person, but it is not so in the case of a rich man who borrows money to develop his own commercial enterprise and earn huge profits through it. Therefore, it is only the loans of the first kind i.e. consumption loans on which any excess is termed as Riba and not an increased amount charged on the commercial loans.
We have paid due consideration to this argument but it could not stand the academic scrutiny for three different reasons:
(i) Validity of a transaction is not based on the financial status of a party
Firstly, the validity of a financial or commercial transaction does never depend on the financial position of the parties. It rather depends on the intrinsic nature of the transaction itself. If a transaction is valid by its nature, it is valid irrespective of whether the parties are rich or poor. Sale, for example, is a valid transaction whereby a lawful profit is generated. It is allowed regardless of whether the purchaser is rich or poor. Lease is a lawful transaction and it is permissible even though the lessee is a poor person. The most one can say is that a poor purchaser or a poor lessee deserves concession on humanitarian grounds, but one cannot say that charging any amount of profit. from him is totally haram or prohibited. If a poor person wants to purchase bread from a baker, one can say that the baker should not charge a high profit from him, but no one can say that the baker is obligated to sell the bread to him at his cost and any profit charged by him above the cost is totally unlawful for which he deserves hell. If a poor person hires a taxi, one can advise the owner of the taxi to give some concession to him on the basis of his poverty, but no one can reasonably assert that the owner of the taxi must not charge any fare from him or must not charge a fare higher than his actual expense, otherwise his income will be held as haram and analogous to waging war against Allah and His Messenger. The baker has opened his shop to earn a lawful profit through the transaction of sale which is intrinsically a valid transaction, and he deserves a reasonable profit for his investment and labour, even though the h purchaser is poor. If he is obligated to sell his breads to all the poor persons at his cost price, he can neither run his shop nor can earn livelihood for his children. Similarly, the one who runs a taxi for rendering transport services to the passengers is allowed to charge a reasonable fare from those benefiting from his service. If he is required to render this service to all poor persons free of charge, he cannot run the taxi. Nobody has, therefore, ever claimed that charging any profit or a fee or a fare from a poor person is totally haram. The reason is that profit, fee and fare, being lawful charges deserved by valid transactions, may be charged from the persons benefiting from the commodities sold or services rendered, even though the benefiting persons are poor. .
On the other hand, the prohibited transactions are invalidated on the basis of their intrinsic nature and not on the basis of the financial position of the parties. Gambling is prohibited for both rich and poor persons. Bribery is unlawful regardless of whether the bribe is charged from the rich or from the poor. It is, therefore, evident that it is not the richness or poverty of the parties that renders a transaction valid or invalid. It is the intrinsic nature of the transaction that really determines its validity or otherwise.
The case of charging interest from a debtor is in no way different. If it is a valid charge according to its intrinsic nature, it should be allowed, even though the debtor is poor, but if it is an invalid charge by itself, it should be unlawful irrespective of the financial position of the parties. There is no justification for distinguishing the case of interest from that of a sale in this respect by. restricting the former's validity to the rich borrowers only, while charging of profit in a sale is allowed from both rich and poor persons. In fact, the notion that interest is prohibited only where the borrower is poor is totally against the well‑established principles of business and trade where the validity of transactions is judged on the basis of their own strength and not on the identity of the parties involved.
Moreover, `poverty' is a relative term which has different degrees. Once it is accepted that interest cannot be charged from the poor, while it is quite lawful to be charged from the rich, who will have the authority to determine the exact degree of poverty required for exempting a, person from the charge of interest? If the distinction between lawful and unlawful interest is drawn on the basis of the purpose of the loan, and the loans taken for consumption are exempted from the charge of interest, as urged by some appellants, the consumption itself may be of different kinds which range from food items to luxurious objects. Even if the 'consumption' is restricted to the requirements of one's life, they too vary from person to person. One may argue that private transport has become one of the necessities of life, and therefore, he is entitled to take an interest‑free loan for purchasing a car. House is one of the fundamental necessities of one's life and no interest can be charged on millions of rupees borrowed for the purpose of constructing or purchasing a house, because all these borrowings fall within the category of 'consumption loans'. On the other hand, if an unemployed person borrows a few hundred rupees to start hawking on the streets, it will be quite lawful to charge interest from him, because his loan does not fall within the definition of a consumption loan'.
It is thus, clear that the permissibility of interest can neither be based on the financial position of the debtor, nor on the purpose for which money is borrowed, and therefore, the distinction between consumption loans and productive loans in this respect is contrary to the well‑established principles.
(ii) The Nature of Our'anic Prohibitions
(c)??????? Banking and Productive Loans in the Age of Antiquity
Thirdly, it is not correct to say that commercial or productive loans were not in vogue when Riba was prohibited. More than enough material has now come on the record to prove that commercial and productive loans were not foreign to the Arabs, and that loans were advanced for productive purposes both before and after the advent of Islam.
In fact the academic and historical research has discovered the fallacy of the impression that mercantile loans and banking transactions are the invention of the 17th Century A.D.27 Modern discoveries have shown that the history of banking transactions refers back to a period not less than two thousand years before Christ. The Encyclopaedia Britannica, while discussing the history of banks, has detailed the early traces of the banking transactions. The relevant article begins with the following remark:
"Pastoral nations such as
Hebrews, while they maintained money?lenders, had no system of banks that would be considered adequate from the modern point of view. But as early as 2000
B.C., the Babylonians had developed such a system. It was not the result of private initiate, as that time, but an incidental service performed by the organized and wealthy institution of the cult. The temples of Babylon, like those of Egypt, were also the banks. The shekels of silver' runs a Babylonian document,have been borrowed by Mas?:.. Schamach, the son of Adadrimeni, from the Sun‑priestess Amat?Schamach. daughter of Warad‑Enlii. He will pay the Sun‑.God's interest. At the time of the harvest he will pay back the sum and the interest upon it'. It is evident enough that the priestess Amat
?Schamach was merely the accredited agent of the institution. No doubt the clay tablet with the inscription corresponds to what we call negotiable commercial paper. Another document of the same period was certainly such. It runs: `Warad‑Ilisch, the son of Taribum, has received from the Sun‑Priestess Iltani, daughter of Ibbatum, one shekel silver by the sun‑God's balance. This sum is to be used to buy sesame. At the time of the sesame‑harvest, he will repay in sesame, at the current price, to the bearer of this I Q document "."
The article has then detailed how the banking operations developed from religious institutions to private business institutions, until in 575 B.C. there was a banking institution in Babylon, the Igibi Bank of Babylon. The records of this bank show that it acted as buying agent for clients; loaned on crops, attaching them in advance to ensure reimbursement; loaned on signatures and on objects deposited, and received deposits on interest. The article has further detailed that similar banking institutions existed also in Greece, Rome, Egypt etc. centuries before Christ and they deposited money, lent it on interest and extensively used letters of credit, financial papers and traded in them.
Will Durant, the famous historian of the recent past, has given a detailed account of the banking transactions prevalent in Greece in the fifth century before Christ. He has mentioned that despite interest being denounced even by the philosophers, there were banks in Greece:
"Some deposit their money in temple treasuries. The temples serve as banks, and lend to individuals and States at a moderate interest; the temple of Apollo at Delphi is in some measure an international bank for all Greece. There are no private loans to Governments, but occasionally one State lends to another. Meanwhile the money?changer at his table (trapeza) begins in the fifth century to receive money on deposit, and to lend it to merchants at interest rates that vary from 12 to 30 per cent. according to the risk; in this way he becomes a banker, though to the end of ancient Greece he keeps his early name of trapezite, the man at the table. He takes his methods from the near East, improves them, and passes them on to Rome, which hands them down to modern Europe. Soon after the Persian War, Themistocles deposits seventy talents ($420,000) with the Corinthian banker Philostephanus, very much as political adventurers feather foreign nests for themselves today; this is the earliest known allusion to secular‑non temple‑banking. Towards the end of the century Antisthenes and Archestrtus establish what will become, under Pasion, the most famous of all private Greek banks. Through such trapezitai money circulates more freely and rapidly, and so does more work, than before, and the facilities that they offer stimulate creatively the expansion of Athenian trade.
"Persons of illustrious rank were confined to the moderate profit of four per cent; six was pronounced to be the ordinary and legal standard of interest; eight was allowed for the convenience of manufacturers and merchants twelve was granted to nautical insurers.
(Underlining is ours).
80.?????? Ibn‑al‑Anbari quotes another poet saying :
Rather, some contemporary writers have claimed that the nomenclature of the Arabic coins (Dirham, Dinar and Fals) is originally derived from the Greece or Latin words which are very similar to these names." These Byzantine coins remained in use throughout the Muslim world till the year 76 A.H., when Abdulmalik ibn Marwan started coining his own Dinars."
Keeping in view such close financial relations of the Arabs with the Roman Empire, how can it be imagined that the Arabs were totally unaware of the credit transactions flourishing in the Roman Empire? As we shall see later, the business relations of the Arabs were not restricted to Syria. They extended to Iraq, Egypt and Ethiopia as well. They were fully aware of the business style of these countries, and their awareness about the interest based transactions of these countries is reflected in an advice given by Abdullah b. Salaam (r.a.a.) (a native of Madinah) to Abu Burdah (who had settled in Iraq and came to visit Madinah). Abdullah b. Salaam warned him that he was living in a country where Riba had wide currency, and therefore, he should be very careful while dealing with other people lest he should indulge in Riba unconsciously." The same advice was given by Hazrat Ubayy‑ibn‑Kab (r.a.a.) to his pupil Zirr b. Hubaish."
Commercial Interest in Arabia
And they sat down to eat bread: and they lifted up their eyes and looked, and, behold, a company of Ishmaelites came from Gilad with their camels bearing spicery and balm and myrrh, going to carry it down to Egypt.31
This Arab caravan was going to export spices, balms and perfumes in such an early period to such a distant country, the Egypt, that was thousands of miles away from the centre of Arabia. It may show the extent to which the Arabs had deployed their courageous entrepreneurship right from the beginning of their history.
Naturally, the commercial activities of the Arabs kept on increasing in the later days, so much so that they were identified as a trading nation. How far their international trade had flourished before the advent of Islam has been detailed by the historians, and it is neither possible nor necessary to give all these details here', but the fact that the Arabs were trade‑oriented people can hardly be questioned by a person who has studied their history. The importance of their trade caravans can be assessed by the fact that the Holy Qur'an has revealed a full Surah (Al‑Quresh) to denote that their business towards Yemen in winter and towards Syria in summer were a blessing from Allah on account of their services to Kabah. The Holy Qur'an has specifically mentioned the term ilaaf which refers to the commercial treaties the Arabs of Quraish had with different nations and tribes.?' The size of these caravans may be imagined from the fact that the caravan led by Abu Sufyan at the time of the Battle of Badr consisted of one thousand camels and had returned with 100% profit (one Dinar for every Dinar).
Obviously, the caravan of this huge size could not be owned by any one individual. It was a collective enterprise of the whole tribe and was funded, by the contributions of all the members of the tribe like a joint stock company. The historians have noted that:
.??????????
There remained no male or female in the tribe of Quraish who had one misqaal of gold and had not contributed to the caravan.
?87. It was not only the caravan of Abu Sufyan that was funded in this manner. Almost all the big caravans used to be organized on the same pattern.
(a)??????? Dr. Jawad Ali, whose extensive research about the Arabs of Jahiliyyah is appreciated throughout the academic world, has analyzed the funding sources of these caravans and has remarked as under:
what the historians have narrated about the caravans of Makkah reveals that the capital of a caravan never used to be the capital of one individual or a particular family; it rather belonged to the traders of different families and to those individuals who themselves had money or had borrowed it from others and had contributed it to the capital of the caravan with a hone to earn huge profit." (Underlining is ours)
The underlined sentence shows that these caravans used to be funded, inter alia, by the commercial loans. .
(b)??????? All the books of tafseer have mentioned the background of the verses of Surah al‑Baqarah dealing with Riba. Almost all of them have reported that different tribes of Arabia 'used to take interest?based loans from each other. For, example, Ibn Jarir al‑Tabari says:
The tribe of Banu Amr used to charge interest from the tribe of Banu al‑Mughirah and Banu al‑Mughirah used to pay them interest."
These loans were not taken by one individual from another. Instead, the tribe as a collective entity used to borrow money from another tribe. We have already shown that the tribes of Arabia used to work as a joint stock company for the purpose of funding their trade‑caravans and in order to undertake their joint enterprise. Therefore, the loans taken by one tribe from the other were not for the purpose of consumption only; they were certainly commercial loans meant to finance their commercial ventures.
(c) While explaining the verse of Surah Al‑Rum (30:39), already quoted in para. No.17 of this judgment, Ibn Jarir al‑Tabari has reported the view of some earlier commentators of the Holy Qur'an that this verse refers to the practice of some people in Jahiliyya who would finance some others to increase the wealth of the recipients.? Ibn Jarir has supported this view by the following statement of Hazrat Ibn Abbas (r.a.a.):‑‑
Have you not seen a person saying to another, I shall certainly finance you then he gives him? So, this does not increase with Allah, because he gives him not to please Allah, but to increase his wealth.
He has also quoted the following statement of Ibrahim al‑Nakhai in the same context:
It was in the days of Jahiliyya that one used to give money to one of his relatives to increase his wealth."
Obviously, financing for the purpose of increasing wealth of the recipient means that the recipient would invest this money to earn profit and thereby increase his wealth. These statements of Ibn Abbas (r.a.a.) and Ibrahim al‑Nakhai clearly show that the practice of financing for productive purposes was so prevalent in the Arab Society that, according to these commentators, the verse of Surah al‑Rum was revealed in that context.
(d)??????? The concept of commercial loan finds mention in a hadith of the Holy Prophet (p.b.u.h.) himself, which is reported by Imam Ahmad, Al‑Bazzar and Al‑Tabarani from Abdurrahman‑ibn‑Abi?Bakr (r.a.a.). According to him, the Holy Prophet (p.b.u.h.) has said:
Allah Almighty will call a debtor on the Day of Judgment. He will stand before Allah and will be asked: O son of Adam, why did you take this loan and why did you violate the rights of the people?, He will say, My Lord, you know that I have taken this loan, but neither used it in a eating or drinking nor in wearing clothes nor in S doing something, instead, I was afflicted either by fire or by theft or by a business loss. Allah will say, My slave has told the truth. I am the best One who will pay today on your behalf.
The underlined words contemplate that this person had borrowed money for commercial purpose whereafter he suffered a business loss. It, shows that the concept of the loans taken for commercial purposes was quite' clear even in the mind of the Holy Prophet (p.b.u.h.) .
(e)??????? The Holy Prophet (p.b.u.h.) has, in another authentic hadith reported by Imam Bukhari, narrated the story of an Israelite person who had borrowed one thousand dinars from another person and then embarked on a sea voyage." Some other reports have expressly mentioned that this borrowing was for commercial purpose." Moreover, such a huge amount cannot be borrowed for normal consumption needs, and the hadith mentions that the borrower set out on his sea voyage and after the date of maturity he earned so much that he sent one thousand dinars to his creditor, and offered to pay him the same amount once more under the impression that the first payment did not reach him, but the creditor admitted that he had received the amount and, therefore, he refused the debtor's offer to pay him once more.
There is another example of where the Holy Prophet (p.b.u.h.) himself has referred to a commercial loan.
(t)???????? Apart from the practice of the trade caravans detailed above, there are many examples to show that the commercial loans used to be given and taken on individual level as well. Some of the examples are given below:
(i)???????? Abu Lahab, the uncle of the Holy Prophet (p.b.u.h.) was one of the most inimical persons towards him, but he did not participate personally in the Battle of Badr. The reason was that he had advanced a loan of four thousand dirhams on interest to one Asi‑bin‑Hisham and when he could not repay it, he hired his debtor against his loan to replace him in the battle. Obviously, this amount of four thousand dirhams was too big (in those days) to be borrowed by a starving person to satisfy his hunger. It was certainly borrowed for the purpose of trade which could not bring fruit and the debtor stood bankrupt.
(ii)??????? It is reported by several books of hadith and history that Hazrat Zubair Ibn Awwam (r.a.a.), was one of the richest companions of the Holy Prophet (p.b.u.h.). On account of his credibility people wanted to deposit their money with him in trust, but he refused to receive any deposit from any one unless he gives it to him as a loan. It was beneficial for the depositor, because after treating it as a loan, Hazrat Zubair (r.a.a.), was liable to repay it in any case, while in the case of a simple deposit in trust, he would not be liable to repay if the amount is lost by theft, fire etc. Once the people deposited money with Hazrat Zubair (r.a.a.), as a loan, he invested the money in trade. The manner in which Hazrat Zubair (r.a.a.), used to receive deposits and invest them in trade is very similar to a private bank. It is reported by Imam Bukhari that his liabilities toward his depositors were calculated, at the time of his death, to be two million and two hundred thousand, and all this amount was invested in commercial projects."
(iii)?????????????????? Ibn Saad has reported Hazrat Umar (r.a.a.) wanted to send a trade caravan to Syria, and for that purpose he borrowed four thousand dirhams from Hazrat Abdurrahman‑ibn‑Awaf (r. a.a.)
(iv)?????? Ibn Jarrir has reported that Hind daughter of Utbah and wife of Abu Sufyan borrowed four thousand dirhams from Hazrat Umar (r.a.a.), for the purpose of her trade. She invested this money in purchasing goods and selling them in the market of the tribe of Kalb.
(v)??????? Al‑Baihaqi has reported that Hazrat Miqdad‑ibn‑Aswrd (r.a.a.), borrowed seven thousand dirhams from Hazrat Usman (r.a.a.).` Obviously, this amount was not borrowed by a poor person for his consumption needs, because Hazrat Miqdad, the borrower was of the rich Sahaba who was the only one riding a horse in the battle of Badr and whose agricultural produce was purchased by Hazrat Muawiyah (r.a.a.), for 100,000 dirhams."
(vi)?????? When Hazrat Umar (r.a.a.) received the fatal blow from a Christian, he called his son and directed him to calculate the amounts he owed to his creditors. His son calculated the amount and found that it was 80,000 dirhams." Some people advised Hazrat Umar (r.a.a.) to borrow this money from Baitulmal, so that he may relieve himself from his liability towards the people and that the debt of the Baitulmal might be settled after selling his assets, but Hazrat Umar (r.a.a.) rejected the suggestion and directed his sons to pay the amount from his own assets." Obviously, this amount of 80,000 dirhams could not have been borrowed for personal consumption.
(g)??????? Imam Maalik has reported in his Al‑Muwatta that Abdullah and Ubaidullah, the two sons of Hazrat Umar (r.a.a.), went to Iraq for the purpose of Jihad. While coming back they met Abu Musa Al‑Ashari (r.a.a.) the Governor of the City of Basra. He told them he wanted to send some money of the public exchequer to Hazrat Umar (r.a.a.) in Madina. Instead of giving them that money in trust, he suggested that he gives it to them as a loan so that it may remain in the risk of Abdullah and Ubaidullah and may reach safely to Hazrat Umar (r.a.a.) and it was beneficial for Abdullah and Ubaidullah as well because after taking the amount as loan, they could purchase some goods from Iraq and sell them in Madina and after settling the principal amount to Hazrat Umar (r.a.a.), they could earn some profit. They accepted the suggestion' and acted accordingly. When after reaching Madina they paid the principal amount to Hazrat Umar (r.a.a.), he asked them whether Abu Musa (r.a.a.) ??????????? had given such a loan to all the members of the army as well. They replied in negative. Hazrat Umar (r.a.a.) said, `he has given you this loan only because of your relationship with me, therefore, you will have to return not only the principal but also the profit earned through it'. Ubaidullah Ibn Umar objected that this decision was not just, because if the goods purchased by them were destroyed in the way, they would have borne the risk and were table to pay the principal amount in any case, therefore; they deserve the profit they earned. Still Hazrat Umar (r.a.a.) insisted to return the profit to Baitulmal. One of the persons present at that time suggested to Hazrat Umar (r.a.a.) that instead of claiming all the profit from them, he might convert this transaction into Mudarabah through which half of the profit would be deserved by Abdullah and Ubaidullah and the remaining half would go to Baitulmaal. Hazrat Umar (r.a.a.) accepted this proposal and acted accordingly."
Obviously the loan advanced to Abdullah and Obaidullah in this case was a commercial loan contemplated from the very beginning to be invested in trade.
Excessive Rates of Interest
those who believe, do not eat Riba doubled and redoubled (3:130)
It is argued that this verse of the Holy Qur'an is the first verse that came with a clear prohibition of Riba, but it has qualified the prohibition by the words "doubled and redoubled" to denote that the practice of Riba is forbidden only when the rate is so excessive that it makes the payable amount twice that of the principal. The logical result of this expression would be that if the rate of interest is not so high, the prohibition is not applicable. The interest charged in the present banking system, it is argued, is not normally so high as to make the payable amount double the principal, and, therefore, the banking interest is not covered by the prohibition.
This argument overlooks the fact that the different verses of the Holy Qur'an relating to the same subject must be studied in juxtaposition with each other. No verse can be interpreted in isolation from the other relevant material available in other parts of the Holy Qur'an. As explained at the very beginning, the Holy Qur'an has dealt with the subject of Riba in four different chapters. Obviously, no verse can contradict another verse on the same subject. The most detailed treatment of the subject of Riba is found in Surah AI‑Baqarah, the relevant verses of which have already been quoted and translated in paragraph 15 of this judgment. These verses include the following command:
O those who believe fear Allah and give up whatever remains of Riba, if you are believers.
93, The words "whatever remains of Riba" in this verse indicate that every amount over and above the principal has to be given up. This point is further clarified in express terms by the following sentence ‑
And if you repent (from the practice of Riba) then you are entitled to get back your principal.
These words do not leave any ambiguity in the fact that repentance from the practice of Riba is not possible unless any amount exceeding the principal is given up and that a lender is entitled only to the principal he has actually advanced. A combined study of the verses of Surah Al‑Imran and Surah Al‑Baqarah leaves no doubt in the fact that the words "doubled and redoubled" occurring in Surah Al‑Imran are not of restrictive nature, and that "doubled and redoubled" is not a necessary condition for the prohibition of Riba. These words have rather been used to refer to the worst kind of practice of Riba rampant at that time.
In order to fully understand the point, we must refer to one of the basic principles of the interpretation of the Holy Qur'an. The Holy Book is not originally a statute book meant to be used as a legal text. It is a book of guidance which, along with certain laws or commandments, embodies many expressions having persuasive value. Unlike the text of a statute book, the Holy Qur'an contains some words or expressions used either for emphasis or for explaining the evil results of a particular act. They are not meant to be taken as a restrictive qualification for the command or the prohibition preceding them. A self‑evident example of this style of the Holy Qur'an is the verse which says:
"Do not sell my verses for a little price. (AI‑Baraqah 2:41)
Nobody can take this verse ‑to mean that selling the verses of the Holy Qur'an is prohibited only because the price claimed is very low and that if the verses are sold for a higher price, the practice can be held as permissible. Every person of common sense can easily understand that the words "for a little price" used in this verse are not of restrictive nature. They are rather meant to indicate the evil practice of some people who used to commit the grave sin of selling the verses of the Holy Qur'an and still did not gain much in financial terms. It never means that the blame is directed towards the 'little price' they gain; rather the blame is directed to the selling of verses itself.
Similarly, at another place the Holy Qur'an says:
"And do not force your slave girls to prostitution if they want to remain chaste." ( AlNoor 24:33)
Holy Qur'an is quite evident in the light of the verse of Surah Al‑Baqarah already quoted above.
(i)???????? We have already mentioned that the Holy Prophet (p.b.u.h.) made a general declaration of the prohibition of Riba at the time of his last sermon on the occasion of his last Hajj. The words used by him in that sermon, as reported by Ibn Abi Hatim, were as follows:
Listen, every amount of interest that was due in Jahiliyya is now declared void for you in its entirety, You are entitled only to your principal whereby neither you wrong nor be wronged. And the first liability of interest declared to be void is the interest of Abbas?ibn‑Abd‑ul‑Muttalib (r.a.a.), which is hereby declared void in its entirety. (Underlining is ours)
Here the Holy Prophet (p.b.u.h.) declared the total amount exceeding the principal as nullified in its entirety. He has left no ambiguity in the fact that the creditors will be entitled to get back only the principal ' and will not be able to charge even a penny over and above the principal amount.
(ii) It is reported by Hammad b. Salamah in his Jame from Hazrat Abu Hurairah (r.a.a.), that the Holy Prophet (p.b,u.h.) has said:
(iii)
If the creditor received a goat as mortgage from the debtor, the creditor may use its milk to the extent he has spent in providing fodder to the goat. However, if the milk is more than the price of the fodder, the excess is Riba.6'
(iii)?????? Imam Maalik has reported the following ruling of Abdullah Ibn Umar (r. a. a.):
Whoever advances a loan must not stipulate except that the principal loan shall be repayable.61
(iv)?????? Imam Maalik has also narrated in the same chapter that Abdullah Ibn Masood (r.a.a.), used to say:
"Whoever advances a loan cannot stipulate in the agreement that he will receive something better than he has advanced. Even if it be a handful of fodder, it is Riba".
(v)??????? It is reported by Imam Al‑Baihaqi that a person said to Abdullah Ibn Masood (r.a.a.):
"I have taken a loan of 500 from a person on a condition that I shall lend him my horse for riding."
Abdullah Ibn Masood answered:
"Whatever benefit of riding your creditor will receive, it will be Riba.
(vi)?????? The same author has reported that Hazrat Anas Ibn Maalik (r.a.a.) was asked about a person who advances a loan to someone and then the debtor gives him something as a gift, will it be permissible for him to accept that gift? Hazrat Anas Ibn Maalik (r.a.a.), answered that the Holy Prophet (p.b.u.h.) has said:
"If one of you has advanced a loan and the debtor offers the creditor a bowl (of food), he should not accept it, or if the debtor offers him a ride of his animal (cattle) the debtor must not take the ride unless this type of gift has been a usual practice between them before advancing the loan".
The substance of the hadith is that if the debtor and creditor were on friendly terms with each other and it was their habit that one of them used to give a gift to the other, then this type of gift can be acceptable even after the recipient has advanced a loan to the giver. However, if there were no such terms between the creditor and the debtor before the loan transaction, then the debtor should not accept it, because it will have a smell of Riba.
(vii) The same author Al‑Baihiqi has reported from Abdullah Ibn Abbas (r.a.a.), who was asked about a person who owed 20 Dirhams to another person, and started offering his creditor some gifts. Whenever the creditor received a gift, he sold it in the market until the aggregate amount received by the creditor reached 13 dirhams. Abdullah Ibn Abbas (r.a.a.) advised the creditor not to take more than 7 dirhams.'
(viii) It is reported by Hazrat Ali (r.a.a.) that the Holy Prophet (p.b.u.h.) has said: '
Every loan that derives a benefit (to the creditor) is Riba.
This hadith is reported by Harith ibn‑Abi‑Usamah in his Musnad.
Mr. Riazulhasan Gilani, the learned counsel for the Federation of Pakistan assailed the authenticity of this hadith on the ground that certain scholars of hadith have taken it as a weak hadith. He referred to Allamah Munawi who has held its chain of narrators as weak ".
It is true that certain critics of the hadith have not accepted this tradition as authentic, because one of its narrators, Sawwar b. Musab, is held to be unreliable. But at the same time there are other scholars who have accepted the hadith, because despite the weakness of Sawwar, it is corroborated by other sources. This is the view of Allama Azizi 69, Imam Ghazzali and Imam‑al‑Haramai. However, this controversy relates to the above narration which attributes 'this statement to the Holy Prophet (p.b.u.h.), but there is no dispute among, the scholars of hadith in that the same principle has been enunciated by a number of Sahabah like Hazrat Fazalah ‑ b. Ubaid (r.a.a.), whose following statement is reported by Albaihaqi:
"Every loan which derives a benefit is a kind of Riba.
According to Imam Baihaqi, the same principle is also enunciated by Abdullah b. Masud, Ubayy b. Kaab, Abdullah b. Salaam and Abdullah b. Abbas (r.a.a.),'z.
Nobody has disputed the authenticity of these narrations. Even if it is held that the tradition of Hazrat Ali (r.a.a.) attributing the above statement to the Holy Prophet (p.b.u.h:) is not authentic, the same principle has been established undoubtedly by several companions of the Holy Prophet (p.b.u.h.). Since the Sahabah were very careful and cautious in mentioning a principle of Shariah, and did not normally base any such principle on their personal opinion, it may be presumed that the principle enunciated by them unanimously was, in fact, based on a saying of the Holy Prophet (p.b.u.h.) himself. Even if this presumption is ignored, these reports are sufficient at least to prove that the concept of Riba, as understood by the Sahabah, includes any increased amount over the principal, however, little it may be. Obviously, the Sahabah were direct addressees of the Holy Qur'an. They were much more aware of the context and the background of the verses of the Holy Qur'an, and therefore, their understanding of a Qur'anic term like Riba is the most authentic basis for its interpretation.
Mr. Riyazulhasan Gilani, the learned counsel for the Federation, raised another objection on the. authenticity of the above statement. According to him, this statement suffers from an intrinsic infirmity. If a debtor, he argued, gives an additional amount at the time of repayment on voluntary basis without any claim from creditor and without a condition in the original contract of loan, it is never held to be Riba. Yet the words used in the above statement are inclusive of this additional amount also, because the creditor has derived a benefit from his loan, though without his own initiative. It means that the above statement cannot be held as a comprehensive and exclusive definition of Riba, and such a loose statement should not be attributed to the Holy Prophet (p.b.u.h.) or to his companions.
This contention of the learned counsel overlooks the colloquial style of the earlier Arab expressions. Instead of the complex expressions of statutory language, they, used to express the sense in simple style, often conveying a detailed concept in, shortest possible words. In the above statement they have qualified the word Qarz (loan) with the verb Jerra which lexically means `to pull'. The verbal translation of the sentence would be "every loan which pulls along with it a benefit is Riba. " Here the underlined words have been added to indicate that Riba is restricted to a transaction where the loan pulls a benefit along with it in the sense that the T contract of loan itself stipulates a benefit for the creditor. The statement has, therefore, excluded any voluntary amount given by the debtor at the time of repayment without pre‑determined condition.
In the light of the above discussion, there is no force in the contention that the prohibition of Riba is confined to an excessive rate of interest. The directions of the Holy Qur'an and the Sunnah are quite explicit on the point that any amount, however little, stipulated in addition to the principal in a transaction of loan is Riba, hence prohibited.
Riba‑al‑Fadl and Bank loans
Before proceeding further, it will be pertinent to deal with another argument of Mr. Riazul Hasan Gilani, the learned counsel for the Federation, that any increased amount stipulated in a contract of loan right from the beginning does not fall within the definition of Riba Al‑Qur'an and that it falls under the definition of Riba al‑Fadl. However, if the debtor was not able to pay at the date of maturity for a valid reason, any increased amount imposed upon the debtor for giving him more time does fall in the definition of Riba AI‑Qur'an., Since the most banking transactions of today stipulate interest right from the beginning of the transaction, they are not covered, according to the learned counsel, by the prohibition of Riba Al Qur'an, they are rather governed by the principles of Riba al‑Fadl. He further argued that the enforcement of prohibition of Riba al‑Fadl is not the obligation of the State. Its implementation is the responsibility of individual Muslims. It Was never enforced in the form of a statute/decree/law by the Holy Prophet (p.b:u.h.) or by the Khulafa‑e‑Rashedeen. and Muslim rulers of the Islamic history. He further claimed that the prohibition of Riba AI?Fadl is not applicable to‑ the non‑Muslim residents of Islamic State, hence, it is governed by the term "Muslim Personal Law" used in Article 203‑B of the Constitution of Pakistan, and therefore, it stands excluded from the jurisdiction of the Federal Shariat Court and the Shariat Appellate Bench of the Supreme Court of Pakistan.
This argument of the learned counsel is based on the unprecedented theory that an increase stipulated in the initial transaction of loan is Riba al?Fadl, rather than Riba al‑Qur'an. The first leg of this argument which restricts the definition of Riba al‑Qur'an only to a situation where the creditor increases his claim in exchange of more time given to the debtor after the maturity of the loan has already been fully discussed in paras. 43 to 54 of this judgment where we have held that Riba al‑Qur'an is not restricted to that situation alone; it rather includes every transaction where an additional amount is claimed over and above the principal, whether at initial stage or after the maturity. Let us now deal with the second leg of this argument that any increase op the principal stipulated in a contract of loan falls within the definition of Riba a2‑Fadl. The, learned counsel while explaining the concept of Riba al‑Fadl went so far that even interest‑free loans, he claimed, are covered by the Prohibition of Riba al‑Fadl, because according to the hadith prohibiting Riba‑al‑Fadl, the exchange of the six things inter se must be on spot basis. If gold is exchanged for its equal quantity of gold without any addition, but the payment of one side is delayed, it is included in the prohibition of Riba al‑Fadl. Therefore, the learned counsel contended, any transaction of loan whereby the repayment of the principal money (which stands for gold or silver) is delayed from one side is Riba al‑Fadl‑hence, Makruh even though it is returned without any addition, because the transaction of gold for gold (or money for money) is permissible only when two conditions are fulfilled:
(One) that the quantity on both sides are equal.
(Two) that the exchange is effected on the spot.
In an interest‑free loan the condition (b) is lacking, while in an interest‑based loan both conditions are missing, but both kinds of loan fall within the definition of Riba al‑Fadl.
This submission of the learned counsel is not tenable at all, because it is based on a major confusion between the transaction of sale and transaction of loan. The learned counsel has equated the transaction of loan with the transaction of sale. The hadith dealing with Riba al‑Fadl refer to a sale transaction, and not to a loan. The exact words of hadith are:
Do not sell gold for gold, except in equal quantities ...and do not sell the deferred (gold or silver) for the (gold or silver) delivered on the spot."
Here the words "Do not sell" are clear to show that the hadith is speaking of a transaction of sale and not of a loan. There are many points of difference between the two transactions. One major difference is that in a sale effected on deferred payment basis, the seller cannot ask the buyer to pay the price before the stipulated date, while in a transaction of a simple interest‑free loan, the creditor may ask the debtor to repay at any time, and even if a time is stipulated in the transaction of loan, it has only a moral value, and is not binding legally." That is why a transaction of interest‑free loan is allowed, while the transaction of gold for gold on deferred payment basis is not permissible. The contention of the learned counsel that even an interest‑free loan is covered by Riba‑al‑Fadl is, therefore, fallacious on the face of it because the Holy Prophet (p.b.u.h.) himself has not only allowed the transactions of interest‑free loan but has also practised them while he' never allowed a sale of gold for gold on deferred payment basis. The learned counsel has referred to the hadith in which the Holy Prophet (p.b.u.h.) has condemned borrowing loans without genuine need and refused to pray Janaza of a person who died indebted. But here again, the learned counsel has confused two different issues. The Holy Prophet (p.b.u.h.) did U not condemn borrowing loans because the transaction itself was prohibited, but he did so for the simple reason that it is not at all advisable for a person to incur the liability of a loan without a genuine need. Had it been on the basis of the prohibition of the transaction of loan itself, it would have been prohibited for both the lender and the borrower, but obviously advancing a loan has never been held as prohibited. The learned counsel himself referred to a hadith reported by Ibn Majah to the effect that advancing a loan is more meritorious than spending in charity (Sadatjah).' It clearly indicates that the transaction of loan in itself is not prohibited as a transaction, however, the people are advised net to incur the liability of a loan without a genuine need. Conversely, a sale of gold for gold, or silver for silver on' deferred payment basis is a prohibited transaction in itself, and this prohibition is applicable to both the parties, and has never been‑allowed for any one of them in any case.
To sum‑up, the hadith of Riba al‑Fadl are meant to cover the transactions of sale only, and have nothing to do with the transaction of loan which are covered by the rules of Riba al‑Qur'an or Riba al‑Jahiliyya and where it is clearly mentioned that the creditor in a transaction of loan is entitled to claim only his principal amount, and if he does so, it has never been prohibited. It is, therefore, not correct to say that a transaction of interest‑bearing loan fixing an amount as interest right from the beginning of the transaction is covered by the prohibition of Riba al‑Fadl rather than the Riba al‑Qur'an and that the banking interest being a transaction of Riba al?Fadl is not Haram.
The jurisdiction of this Court in the laws of Interest
Having held that the interest charged by the banks on their loans is not Riba al‑Fadl (but it is covered by the definition of Riba al‑Qur'an) we need not go into the question whether its prohibition extends to non‑Muslims also. However, we would like to note that even if the standpoint of the learned counsel is accepted for a moment, his argument that Riba‑al‑Fadl being applicable to the Muslims only, the laws relating to the banking interest are within the definition of "Muslim Personal Law" as contemplated in Article 203‑B of the Constitution of Pakistan, and therefore, they are outside the jurisdiction of the Federal Shariat Court or the Shariat Appellate Bench of this Court, is not sustainable for two obvious reasons:
Firstly, the laws under consideration in the present case are the laws as they exist today and not the laws as they should have been in the opinion of the learned counsel. The existing laws do not differentiate between the Muslims and non‑Muslims ' in their application. They are applicable to non‑Muslims as well as to the Muslims of the country.
Secondly, the notion that laws applicable to Muslims only fall under the definition of "Muslim Personal Law" for the purpose of Article 203‑B of the Constitution is, perhaps, based on a previous judgment of this Court in the case of Mst. Farishta (PLD 1981 SC .120): But seemingly the learned counsel is not cognizant of the fact that the view taken by the Court in this case was later reviewed in a subsequent judgment of this Court in the case of Dr. Mahmoodurrahman Faisal v. The Government of Pakistan (PLD 1994 SC 607) where it is held that the statute laws, even though applicable only to Muslims in general, do not fall under the term "Muslim Personal Law" for V the purpose of Article 203‑B of the Constitution. Therefore, the submission of the learned counsel that the laws relating to bank interest stand excluded from the jurisdiction of this Court, is not tenable at any score.
Basic cause of prohibition
"And if you repent (from charging interest)
?then you are entitled to your principal .
You neither wrong nor be wronged."
Here the words "neither you wrong nor be wronged" indicate that the basic Mat of the prohibition is Zulm. It is argued by some appellants that there is no Zulm (injustice) at all in charging interest from a rich person 1 who has borrowed money to earn huge profits therewith. Since the basic illat of the prohibition is missing in the commercial interest charged by the banks and the financial institutions, it cannot be held as prohibited. The same argument was partly advanced by Mr. Khalid M. Ishaque, Advocate, who, despite his health constraints, was kind enough to appear in this case as a jurisconsult. However, instead of claiming that all the transactions of loan in the present banking system are permissible, Mr. Khalid Ishaq has opined that every individual transaction should be analyzed separately taking into account the surrounding situation of that particular transaction. The focus of the analysis, according to him, should be on the question whether there is an element of Zu1m in the given situation. In case there is a Zulm, the transaction should be taken as Riba, hence prohibited, but if there is no Zulm it should not be taken as haraam..
We have paid due consideration. to this line of argument but were not able to subscribe to it. The argument is based on two assumptions: firstly, that the basic illat of the prohibition is Zulm, and secondly, that there is no Zulm in the modern interest‑based transactions or at least there may be some interest‑based transactions which have no element of Zulm. Both these legs of this argument, after a deeper study, have been found untenable. Let us analyze each one of these two assumptions separately.
The Difference between illat and Hikmat
The Satan definitely intends to inculcate enmity and hatred between you by means of liquor and gambling, and wants to prevent you from remembering Allah. So ‑would you not desist? (5:91)
The philosophy of the prohibition of liquor and gambling given by the Holy Qur'an in this verse is that liquor inculcates enmity and hatred between people and it prevents them from remembering Allah. Can one say that he has been using liquor for a long time but it never resulted in having enmity with any one, and therefore, the basic Mat of the prohibition being not present, he should be allowed to use liquor? Or can one reasonably argue that drinking wine has never prevented him from offering prayers at their due times, and therefore, the basic cause of prohibition mentioned by the Holy Qur'an being absent, the drinking should be held as permissible. Obviously, no one can accept these arguments because the enmity and hatred referred to by the Holy Qur'an in the above verse is not intended to be the illat of the ,prohibition. it simply spells out some bad results which the liquor and gambling often produce. They have been mentioned as a hikmat and the philosophy of the prohibition, but the prohibition itself does not depend on these results. It is in the same way that after prohibiting the transaction of Riba, the Holy Qur'an has mentioned the zulm as a hikmat or a philosophy of the prohibition, but it does not mean that prohibition will not be applicable if the element of Zulm appears to be missing in a particular case. The Mat (the basic feature) on which the prohibition is based is the excess claimed over and above the principal in a transaction of loan, and as soon as this illat is available, the prohibition will follow regardless of whether the philosophy of the law is or is not visible in a particular transaction.
Another point worth mentioning here is that the Mat of a law is always something determinable by hard and fast definition which leaves no room for a dispute as to whether the, Mat is or, is not available. Any relative term which is ambiguous in nature cannot be held to be the illat of a particular law because its existence being susceptible to doubts and disputes, it would defeat the very purpose of the law. The Zulm (injustice) is a relative and rather ambiguous term the exact ‑definition of which is very difficult to ascertain. Every person may have his own view about what is or what is not Zulm. All the disputing political and economic systems of, the world, in fact, claimed to abolish Zulm, but what was regarded as Zulm in one system has been held as justified in another. The communist theory of economy is of the firm view that the private property in itself is a Zulm, while the capitalist theory asserts that abolishing private property is the Zulm. Such an ambiguous term is not competent to be the Mat of a particular law.
Mr. Khalid M. Ishaque, Advocate,, who appeared as a juris consult in this case, adopted another approach. According to him, non‑availability of a hard and fast definition of `zulm' or Riba should be taken as a blessing from Allah, for it provides elasticity to the Muslims of every age to determine what is zulm in the given situations of their time. In his written statement the learned jurisconsult has expressed himself in the following words:
(a)??????? Misdirected efforts towards definition making ought to be, discontinued. Absence of definition of Riba in the Qur'an should be accepted as such and rather be looked upon as a mercy for mankind. The deliberate omission of a rigid definition would propel Muslims to come up with their own guiding and evolving principles of identifying zulm in space‑time situations. Economic conditions are not static and nor are human situations.
(b)??????? A sound economic policy ought to include `all purposeful governmental action whose actual and professed primary objective is the improvement of the economic welfare of the whole population for which Government is responsible,. not of some segment of that population'. The Islamic concept of economy is not inimical or dissimilar to the above. As such, an Islamic approach should neither be insulated and detached from an economistic approach/programme nor should it be in ignorance of the same as they need not be mutually exclusive.
Jurists should not close their mind to the possibility that both, can be synergized to arrive at the most beneficial and fair outcome. Very typically, whenever Muslim jurists have not kept themselves abreast with or informed of contemporary disciplines (economics is a case in point), they have a tendency to become averse to it, treat it with suspicion, regard it as a hazard and simply label it as un‑Islamic to avoid study of the same. "
We paid due consideration to this approach, but with due respect to the learned jurisconsult, this argument seems to overlook some fundamental points:
Firstly, the learned jurisconsult has taken the `deliberate omission of a rigid definition' of Riba (by the Holy Qur'an) as a mercy for mankind. This argument appears to presume that the Holy Qur'an normally gives definitions of the acts prohibited by it, but in the case of Riba the Holy Qur'an deliberately omitted to give a rigid definition. The fact, however, is that the Holy Qur'an has hardly given a legal definition to any one of its prohibitions. No definition is given for Khamr (liquor), nor for Qimar (gambling) nor for zina (adultery or fornication) nor for theft, nor for robbery, nor for Kufr. Similarly the Holy Qur'an did not define its imperatives like Salah, Sowm (fasting), Zakah, Hajj or Jihad. Should we, then, say that none of these concepts has a specific meaning and all these injunctions are, therefore, subject to ever‑changing whims based on space? time situations'? The Holy Qur'an, in fact, did not give legal definitions to these concepts because their meanings were too obvious to need an express definition. Some ancillary details of these concepts might have not been so clear and might have given rise to differences of opinion, but it does not mean that the basic concept of all these injunctions has been floated in void or vacuum, having no specific sense at all.
Secondly, the learned jurisconsult has succinctly outlined the basic features of a sound economic policy in the italicized portion of the above extract. One can hardly question its soundness. Almost all the economic systems claim to strive for the same objectives, but the question is how to achieve them? It is the answer of this very question that has divided different economic systems into conflicting rivals.
The learned jurisconsult suggests that Islamic approach should not be insulated and detached from an economistic approach/programme'. The suggestion seems to be substantially reasonable, but when this suggestion is given in the context of, leaving the definition of Riba unsettled andevolving principles of identifying zu1m in space‑time situations' it apparently means that it is the pure economic approach which will play a decisive role in identifying zulm in a particular situation and in turn determining what is halal or haram in Shariah. Once. it is taken for granted, the question is 'which economic approach'? There are numerous theories, conflicting With each other, but each one of them pretending to race towards the sound economic policy of `improving the economic welfare of the whole population'. The basic economic goals of a welfare economy are recognized by almost everyone thinking on economic subjects. However, it is the strategy for translating these objectives into reality that makes a big difference. The Islamic strategy to achieve these goals is neither too narrow to accommodate the ever‑changing needs of the humanity or too biased to interact with the modern thought, nor is it too dependent on the modern theories to make its own way towards these goals. Islam has no problem in welcoming any constructive suggestion from whatever quarter it may have come, but at the same time it has its own principles on which no compromise is possible, because they are based on divine guidance, the most distinct feature of the Islamic economy that draws the line of difference between the Islamic and secular economies and the prohibition of Riba is one of those basic principles. To leave this principle at the mercy of the secular economic policies is, therefore, like placing the cart before the horse.
Thirdly, abolishing Zulm (injustice) is not the hikmat or purpose of the prohibition of Riba alone.' It is the reson d'etre of most of the Islamic Injunctions relating to business and trade. But whenever the Holy Qur'an and Sunnah gave a specific command or prohibition in these areas, they did not rely on the rational assessment of the people, nor did they leave these transactions at the mercy of human reason to decide whether or not they have an element of Zulm. If the Holy Our'an and the Sunnah intended to entrust such a decision to the human intellect alone, they would have not revealed such a long list of commands and prohibitions; they would have rather issued one, single command that all people must avoid zulm in all' their transactions. But the Holy Qur'an and Sunnah were cognizant of the fact that human reason, despite its wide capabilities, cannot claim to have unlimited power to reach the truth. After all, it has some limits beyond which it either cannot properly work or may fall prey to errors. There are many areas of human life where 'reason' is often confused with `desires' and where unhealthy instincts, under the garb of rational arguments, misguide the humanity and demonstrate the unjust attitudes in the disguised form of justice. It is these areas where human reason needs the guidance of divine W revelation, and it is the divine revelation which finally decides as to which human attitude actually falls within the limits of 'Zulm' or injustice, even though it appears to be just in the eyes of some secular rationalists, and it is in such issues that the divine revelations come with a specific command that prevails upon the rational arguments advanced by differing opinions. That is exactly what happened in the case of Riba. The secular rationalists were fully content with their belief that Riba transactions practised by them were quite justified, because the income they earn through interest is very similar to the profit they earn through sales. That is why they confronted the prohibition of Riba by their rational argument quoted by the Holy Qur'an in the following words:
Sale is nothing but similar to Riba.
(Allah has allowed the sale and has prohibited interest.)
The hint given in this verse is that the question whether these transactions have an element of injustice is not left to be decided by human reason alone, because the reason of different individuals shay come up with different answers and no absolute conclusion of universal application may be arrived at on the basis of pure rational arguments. The correct principle, therefore, is that once a particular transaction is held by Allah to be haraam, there is no room for disputing it on the basis of pure rational argumentation because Allah's knowledge and wisdom encompasses all those points which are not accessible to ordinary reason. If the human reason was fully competent to reach the correct decision unanimously in each and every issue, no divine revelation was called for. There is a wide area of human conduct in which the Creator did not give a specific command. It is this area where human reason can well play its role, but it should not be burdened to play the role of a rival to the express divine injunctions.
The Qur'anic verse referring to zulm (injustice) in the context of Riba should be studied in this perspective. The exact words of the verse are:
And if you repent (from claiming Riba), then
you are entitled to get your principal back.
Neither you wrong nor be wronged.
Rationale of the Prohibition of Riba
Now we come to the second leg of the argument which contends that no element of injustice is found in the commercial or banking interest.
Although, in the light of the above discussion, the Holy Qur'an has itself decided what is injustice in a transaction of loan, and it is not necessary that everybody finds out all the elements of injustice in a Riba transaction, yet the evil consequences of interest were never so evident in the past than they are today. Injustice in a personal consumption loan was restricted to a debtor only, while the injustice brought by the modern interest affects the economy as a whole. A detailed account of the rationale of the prohibition of Riba would, in fact, require a separate volume, but for the purpose of brevity we would concentrate on three aspects of the issue:
(a) The logic of the prohibition on theoretical ground;
(b) The evil effects of interest on production;
(c) The evil effects of interest on distribution;.
Nature of Money
One of the wrong presumptions on which all theories of interest are based is that money has been treated as a commodity. It is, therefore, argued that just as a merchant can sell his commodity for a higher price than his cost, he can also sell his money for a higher price than its face value, or just as he can lease his property and can charge a rent against it, he can also lend his money and can claim interest thereupon.
Islamic principles, however, do not subscribe to this presumption. Money and commodity have different characteristics and, therefore, they are treated differently. The basic points of difference between money and commodity are as follows:
(a) Money has no intrinsic utility. It cannot be utilized in direct fulfilment of human needs. It can only be used for acquiring some goods or services. A commodity, on the other hand, has intrinsic utility and can be utilized directly without exchanging it for some other thing.
(b)??????? The commodities can be of different qualities while money has no quality except that it is a measure of value or a medium of exchange. Therefore, all the units of money of the same denomination, are hundred per cent. equal to each other. An old and dirty note of Rs.1,000 has the same value as a brand new note of Rs.1,000.
(c)??????? In commodities, the transactions of sale and purchase are effected on an identified particular commodity. If A has purchased a particular car by pin‑pointing it, and seller has agreed, he deserves to receive the same car. The seller cannot compel him to take the delivery of another car, though of the same type or quality.
Money, on the contrary, cannot be pin‑pointed in a transaction of exchange. If A has purchased a commodity from B by showing him a particular note of Rs.1,000 he can still pay him another note of the same denomination.
Based on these basic differences, Islamic Shariah has treated money differently from commodities, especially on two scores:
Firstly, money (of the same denomination) is not held to be the subject‑matter of trade, like other commodities. Its use has been restricted to its basic purpose i.e. to act as a medium of exchange and a measure of value.
Secondly, if for exceptional reasons, money has to be exchanged for money or it is borrowed, the payment on both sides must be equal, so that it is not used for the purpose it is not meant for i.e. trade in money itself.
Imam Al‑Ghazzali (d.505 A.H.) the renowned jurist and philosopher of the Islamic history has discussed the nature of money in an early period when the Western theories of money were not existent, at all. He says:
"The creation of dirhams and dinars (money) is one of the blessings of Allah .... They are stones having no intrinsic usufruct or utility, but all human beings need them, because everybody needs a large number of commodities for his eating, wearing etc., and often he does not have what he needs and does have what he needs not... therefore, the transactions of exchange are inevitable. But there must be a measure on the basis of which price can be determined, because the exchanged commodities are neither of the same type, nor of the same measure which can determine how much quantity of one commodity is a just price for another. Therefore, all these commodities need a mediator to judge their exact value .... Allah Almighty has, therefore, created dirhams and dinars (money) as udges and mediators between all commodities so that all objects of wealth are measured through them... and their being the measure of the value of all commodities is based on the fact that they are not an objective in themselves. Had they been an objective in themselves, one could have a specific7 purpose for keeping them which might have given them more importance according to his intention while the one who had no such purpose would have not given them such importance and, thus, the whole system would have been disturbed. That is why Allah has created them, so that they may be circulated between hands and act as a fair judge between different commodities and work as a medium to acquire other things .... So, the one who owns them is as he owns everything, unlike the one who owns a cloth, because he owns only a cloth, therefore, if he needs food, the owner of the food may not be interested in exchanging his food for cloth, because he may need an animal for example. Therefore, there was needed a thing which in its appearance is, nothing, but in its essence is everything. The thing which has no particular form may have different forms in relation to other things like a mirror which has no colour, but it reflects every colour. The same is the case of money. It is not an objective in itself, but it is an instrument to lead to all objectives.,.
So, the one who is using money in a manner contrary to its basic purpose is, in fact, disregarding the blessings of Allah. Consequently, whoever hoards money is doing injustice to it and is defeating their actual purpose. He is like the one who detains a ruler in a prison:,.
And whoever effects the transactions of interest on money is, in fact, discarding the blessing of Allah and is committing injustice, because money is created for some other things, not for itself. So, the one who has started trading in money itself has made it an objective contrary to the original wisdom behind its creation, because it is injustice to use money for a purpose other than it was created for..,. If it is allowed for him to trade in money itself, money will become his ultimate goal and will remain detained with him like hoarded money. And imprisoning a ruler or restricting a postman from conveying messages is nothing but injustice."
consumption goods' and the commodities of the higher order which are calledproductive goods'. Since money, having no intrinsic utility, could not be included in consumption goods' most of the economists had no option but to put it under the category ofproduction goods', but it was hardly proved by sound logical arguments that money is a `production good'. Ludwig Von Mises, the well‑known economist of the present century has dealt with the subject in detail. He says:"of course, if we regard the two‑fold division of economic goods as exhaustive, we shall have to rest content with putting money in one group or the other. This has been the position of most economists; and since it has seemed altogether impossible to call money a consumption good, there has been no alternative but to call it a production good.""
"It is true that the majority of economists reckon money among production goods. Nevertheless, arguments from authority are invalid; the .proof of a theory is in its reasoning, not in its sponsorship; and with all due respect for the masters, it must be said that they have not justified their position very thoroughly in the matter.78
"Regarded from this point of view, those goods that are employed as money are indeed what Adam Smith called them, `dead stock, which... produces nothing'."
The author has then expressed his inclination to the Kien's theory that money is neither a consumption good nor a production good; it is a media of exchange."
The logical result of this finding would have been that money should not be taken as an instrument that gives birth to more money on daily basis, nor should it have been taken as a tradable commodity, when it is exchanged for another money of the same denomination, because once it is accepted that money is neither consumption good nor production good, and that it is merely a medium of exchange, then there remains no room for making itself an object of profitable trade, for ,it will be like a mediator himself has been made a party. But, perhaps due to the overwhelming domination of interest‑based monetary system, many economists did not proceed any further to this direction.
Imam Al‑Ghazzali, on the other hand, has taken the concept of 'medium of exchange' to its logical end. He has concluded that when money is exchanged for money of the same denomination, it should never be made an instrument generating profit by such exchange.
This approach of Imam al‑Ghazzali, fully backed by the clear directives of the Holy Qur'an and Sunnah, has however, been admitted to be true by some realistic scholars, even in societies dominated by interest. Many of them after facing the severe consequences of their financial system based on trade in money have admitted that their economic plight was caused, inter alia, by the fact that money was not restricted to be used for its primary function as a medium of exchange.
During the horrible depression of 1930s, an "Economic Crisis Committee" was formed by Southampton Chamber of Commerce in January, 1933. The Committee consisted of ten members headed by Mr. E. Dennis Mundy. In its report the committee had discussed the root causes of the calamitous depression in national and international trade and had suggested different measures to overcome the problem. After discussing the pitfalls of the existing financial system, one of the committee's recommendation was that:
"In order to ensure that money performs its true function of operating as a means of ,exchange and distribution, it is desirable that it should cease td be traded as a commodity.'"
Prof. John Gray (of Exford University), in his recent work False Dawn has remarked as follows: ‑
"Most significantly, perhaps transactions on foreign exchange markets have now reached the astonishing sum of around $1.2 trillion a day, over fifty times the level of the world trade. Around 95 per cent. of these transactions are speculative in nature, many using complex new derivative's financial instruments based on futures and options. According to Michael Albert, the daily volume of transactions on the foreign exchange markets of the world holds some $900 billions ‑ equal to France's annual GDP and sonie $200 million more than the total foreign currency reserves of the world central banks.
This virtual financial economy has a terrible potential for disrupting the underlying real economy as seen in the collapse in 1995 of Barings, Britain's oldest bank."
The size of derivatives mentioned by John Gray was, by the way, of their daily transactions. The size of their total worth, however, is much greater. It is mentioned by Richard Thomson in his "Apocalypse Roulette" in the following words:
"Financial derivatives have grown, more or less from standing starting in the early 1970s, to a $64 trillion (that's $64,000,000,000,000) industry by 1996. How do you imagine a number that big? You could say that if you laid all those dollar bills end to end, they would stretch from here to the sun sixty‑six times, or to the moon 25,900 times ;12,, 150. James Robertson observes in his latest work, Transforming Economic Life in the following words:
"Today's money and finance system is unfair, ecologically destructive and economically inefficient. The money‑must‑grow imperative derives production (and thus consumption) to higher than necessary levels. It skews economic effort towards money out of money, and against providing real services and goods.
It also results in a massive world‑wide diversion of effort away from providing useful goods and services, into making money out of money. At least 95% of the billions of dollars transferred daily around the world are for purely financial transactions, unlinked to transactions in the real economy."
"Riba (interest), is prohibited because it prevents people from undertaking real economic activities. This is because when a person having money is allowed to earn more money on the basis of interest, either in spot or in deferred transactions, it, becomes easy for him to earn without bothering himself to take pains in real economic activities. This leads to hampering the real interests of the humanity, because the interests of the humanity cannot be safeguarded without real trade skills, industry and construction." .
The Nature of Loan
Another major difference between the secular capitalist system and the Islamic principles is that under the former ‑ system, loans are purely commercial transactions meant to yield a fixed income to the lenders. Islam, on the other hand, does not recognize loans as income‑generating transactions. They are meant only for those lenders who do not intend to earn a worldly return through them. They, instead, lend their money either on humanitarian grounds to achieve a reward in the Hereafter, or merely to save their money through a safer hand. So far as investment is concerned, there are several other modes of investment like partnership etc. which may be used for that purpose. The transactions of loan are not meant for earning income.
The basic philosophy underlying this scheme is that the one who is offering his money to another person has to decide whether‑‑‑
(a)??????? he is lending money to him as a sympathetic act; or
(b)??????? he is lending money to the borrower, so that his principal may be saved; or
(c)??????? he is advancing his money to share the profits of the borrower.
In the former two cases (a) and (b) he is not entitled to claim any additional amount over and above the principal, because in the case (a) he has offered financial assistance to the borrower on humanitarian grounds or any other sympathetic considerations, and in the case (b) his sole purpose is to save his money and not to earn any extra income.
However, if his intention is to share the profits of the borrower, as in the case (c), he shall have to share his loss also, if he suffers a loss. In this case, his objective cannot be served by a transaction of loan. He will have to undertake a joint venture with the opposite‑party, whereby both of them will have a joint stake in the business and will share its outcome on fair basis. Conversely, if the intent of sharing the profit of the borrower is designed on the basis of an interest‑based loan, it will mean that the financier wants to ensure his own profit, while he leaves the profit of the borrower at the mercy of the actual outcome of the business. There may be a situation where the business of the borrower totally fails. In this situation he will not only bear the whole loss of the business, but he will have also to pay interest to the lender, meaning thereby that the profit or interest of the financier is guaranteed at the price of the destructive loss of the borrower, which is obviously a glaring injustice.
On the other hand, if the business of the borrower earns huge profits, the financier should have shared him in the profit in reasonable proportion, but in an interest‑based system, the profit of the financier is restricted to a fixed rate of return which is governed by the forces of supply and demand of money and not on the actual profits produced on the ground. This rate of interest may be much less than the reasonable proportion a financier might have deserved, had it been a joint venture. In this case the major part of the profit is secured by the borrower, while the financier gets much less than deserved by his input in the business, which is another form of injustice.
Thus, financing a business on the basis of interest creates an unbalanced atmosphere which has the potential of bringing injustice to either of the two parties in different situations. That is the wisdom for which the Shariah did not approve an interest‑based loan as a form of financing.
Once the interest is banned, the role of `loans' in commercial activities becomes very limited, and the whole financing structure turns out to be equity‑based and backed by real assets. In order to limit the use of loans, the Shariah has permitted to borrow money only in cases of dire need, and has discouraged the practice of incurring debts for living beyond one's means or to grow one's wealth. The well‑known event that the Holy Prophet (p.b.u.h.) refused to offer the funeral prayer (salat‑ul janazah) of a person who died indebted' was, in fact, to establish the principle that incurring debt should not be taken as a natural or ordinary phenomenon of life. It should be the last thing to be resorted to in the course of economic activities. This is one of the reasons for which interest has been prohibited, because, given the prohibition of interest, no one will be agreeable to advance a loan without a return for unnecessary expenses of the borrower or for his profitable projects. It will leave no room for unnecessary expenses incurred through loans. The profitable ventures, on the other hand, will be designed on the basis of equitable participation and, thus, the scope of loans will remain restricted to a narrow circle, 160. Conversely, once the interest is allowed, and advancing loans, in itself, becomes a form of profitable trade, the whole economy turns into a debt‑oriented economy which not only dominates over the real economic activities and disturbs its natural functions by creating frequent shocks, but also puts the whole mankind under the slavery of debt. It is no secret that all the nations of the world, including the developed countries, are drowned in national and foreign debts to the extent that the amount of payable debts in a large number of countries exceeds their total income. Just to take one example of UK, the household debt in 1963 was less than 30% of total annual income. In 1997, however, the percentage of household debt rose up to more than 100% of the total income. It means that the household debt throughout the country, embracing rich and poor alike, represents more than the entire gross annual incomes of the country. Consumers have borrowed, and made purchases against their future earnings, equivalent to more than the entirety of their annual incomes, Peter Warburton, one of the UK's most respected financial commentators and a past winner of economic forecasting awards, has commented on this situation as follows:
"The credit and capital markets have grown too rapidly, with too little transparency and accountability. Prepare for an explosion that will rock the Western financial system to its foundation e'."
Overall Effects of Interest
161, Interest‑based loans have a persistent tendency in favour of the rich and against the interests of the common people. It carries adverse effects on production and allocation of resources as well as on distribution of wealth. Some of these effects are the following:
(a) Evil effects on allocation of Resources
"Credit, therefore, tends to go to those who, according to Lester Thurow, are 'lucky rather than smart or meripcratic." The banking system thus tends to reinforce the unequal distribution of capital." Even Morgan Guarantee Trust Company, sixth largest bank in the U.S. has admitted that the banking system has failed to 'finance either maturing smaller companies or venture capitalist' and 'though awash with funds, is not encouraged to deliver competitively priced funding to any but the largest, most cash‑rich companies." Hence, while deposits come from a broader cross ?section of the population, their benefit goes mainly to the rich."
(Dr. Chapra's written statement under the caption "Why has Islam prohibited Interest? P.18)
(b)??????? Evil effects on production
Since in an interest‑based system funds are provided on the basis of strong collateral and the end‑use of the funds does not constitute the main criterion for financing, it encourages people to live beyond their means. The rich people do not borrow for productive projects only, but also for conspicuous consumption.
Similarly, governments borrow money not only for genuine development programmes, but also for their lavish expenditure and for projects motivated by their political ambitions rather than being based on sound economic assessment. Non‑project‑related borrowings, which were possible only in an interest‑based system have, thus, helped in nothing but increasing the size of our debts to a horrible extent. According to the budget of 1998‑99 in our country 46 per cent. of the total Government spending is devoted to debt‑servicing, while only 18 % is allocated for development which includes education, health and infrastructure.
(c) Evil effects on distribution
We have already pointed out that when business is financed on the basis of interest, it may bring injustice either to the borrower if he suffers a loss, or to the financier if the debtor earns huge profits. Although both situations are equally possible in an interest‑based system, and there are many examples where the payment of interest has brought total ruin to the small traders, yet in our present banking system, the injustice brought to the financier is more pronounced and much more disturbing to the equitable distribution of wealth.
In the context of modern capitalist system, it is the banks which advance depositors' money to the industrialists and traders. Almost all the giant business ventures are mostly financed by the banks and financial institutions. In numerous cases the funds deployed by the big entrepreneurs from their own pocket are much less than the funds borrowed by them from the common people through banks and financial institutions. If the entrepreneurs having only ten million of their own, acquire 90 million from the banks and embark on a huge profitable enterprise, it means that 90% of the projects is created by the money of the depositors while only 10% was generated by their own capital. If these huge projects bring enormous profits, only a small proportion (of interest which normally ranges between 2 % to 10 % in different countries) will go to the depositors whose input in the projects was 90% while all the rest will be secured by the big entrepreneurs whose real contribution to the projects was not more than 10% . Even this small proportion given to the depositors is taken back by these big entrepreneurs, because all the interest paid by them is included in the cost of their production and comes back to them through the increased prices. The net result in this case is that all the profits of the big enterprises is earned by the persons whose own financial input does not exceed 10 % of the total investment, while the people whose financial contribution was as high as 90% get nothing in real terms, because the amount of interest given to them is often repaid by them through the increased prices of the products, and therefore, in a number of cases the return received by them becomes negative in real terms.
While this phenomenon is coupled with the fact, already mentioned, that 64.5 % of total advances went only to 0.4243 % of total account holders, it means that the profits generated mostly by the money of millions of people went almost exclusively to 9,269 borrowers. One can imagine how far the interest‑based borrowings have contributed to the horrible inequalities found in our system of distribution, and how great is the injustice brought by the modern commercial interest to the whole society as compared to the interest charged on the old consumption loans that affected only some individuals.
How the present interest‑based system works to favour the rich and kill the poor is succinctly explained by James Robertson in the following words:
"The pervasive role of interest in the economic system results in the systematic transfer of money from those who have less to those who have more. Again, this transfer of resources from poor to rich has been made shockingly clear by the Third World debt crisis. But it applies universally. It is partly because those who have more money to lend, get more in interest than those who have less; it is partly because those who have less, often have to borrow more; and it is partly 'because the cost of interest repayments now forms a substantial element in the cost of all goods and services, and the necessary goods and services looms much larger in the finances of the rich. When we look at the money system that way and when we begin to think about how it should be redesigned to carry out its functions fairly and efficiently as part of an enabling and conserving economy, the arguments for an interest‑free inflation‑free money system for the twenty‑first century seems to be very strong.9Z
"The transfer of revenue from poor people to rich people, from poor places to rich places, and from poor countries to rich countries by the money and finance system is systematic .... One cause of the transfer of wealth from poor to rich is the way interest payments and receipts work through the economy.9'
(d) Expansion of artificial money and inflation
Since interest‑bearing loans have no specific relation with actual production, and the financier, after? securing a strong collateral, normally has no concern how the funds are used by the borrower, the money supply effected through banks and financial institutions has no nexus with the goods and services actually produced on the ground. It creates a serious mismatch between the supply of money and the production of goods and services.? This is obviously one of the basic factors that create or fuel inflation.
This phenomenon is aggravated to a horrible extent by the well? known characteristic of the modern banks normally termed as 'money creation'. Even the primary books of economics usually explain, often with complacence, how the banks create money. This apparently miraculous function of the banks is sometimes taken to be one of the factors that boost production and bring prosperity. But the illusion underlying this concept, is seldom unveiled by the champions of modern banking.
The history of 'money creation' refers back to the famous story of the goldsmiths of medieval England. The people used to deposit their gold coins with them in trust, and they used to issue a receipt to the depositors. In order to simplify the process; the goldsmiths started issuing 'bearer' receipts which gradually took the place of gold coins and the people started using them in settlement of their liabilities. When these receipts gained wide acceptability in the market, only a small fraction of the depositors or bearers ever came to the goldsmiths to demand actual gold. At this point the goldsmiths began lending out some of the deposited gold secretly and thus started earning interest on these loans. After some time they discovered that they could print more money (i.e. paper gold deposit certificates) than actually deposited with them and that they could loan out this extra money on interest. They acted accordingly and this was the birth of 'money creation' or 'fractional reserve lending' which means to loan out more money than one has as a reserve for deposits. In this way these goldsmiths, after becoming more confident, started decreasing the reserve requirement and increasing the percentage of their self‑created credit, and used to loan out four, five, even ten times more gold certificates than they had in their safe rooms.
Initially, it was abuse of trust and a sheer fraud on the part of the goldsmiths not warranted by any norm of equity, justice and honesty. It was a form of forgery and usurpation of the power of the sovereign authority to issue money. But overtime, this fraudulent practice turned into the fashionable standard practice of the modern banks under the 'fractional reserve' system. How the money changers and bankers have succeeded in legalizing the creation of money by the private banks, in spite of the strong opposition from several rulers in England and USA, and how the Rothchilds acquired financial mastery over the whole of Europe and the Rockfeller over the whole of America is a long story ", now lost in the mist of numerous theories developed to support the concept of money‑creation by the private banks.. But the net result is that the modern banks are creating money out of nothing. They are allowed to advance loans in the amounts ten times more than their deposits. The coins and notes issued by the Government ' as a genuine and debt‑free money have now a very insignificant proportion in the total money in circulation, most of which is artificial money created by advances made by the banks. The proportion of real money issued by the governments has been constantly declining in most of the countries, while the proportion of the artificial money created by the banks out of nothing is ever‑increasing. The spiral of loans built upon loans is now the major; part of the money supply. Taking the example of UK according to the statistics of 1997 the total money stock in the country was 680 billion pounds, out of which only 25 billion pounds were issued by the Government in the form of coins and notes. All the rest i.e. 655 billion pounds were created by the banks. It means that the original debt‑free money remained only 3.6% of the whole money supply while 96.4% is nothing but a bubble created by the banks. The way this bubble is growing annually can be seen from the following table that details the quantum of money supply in UK during twenty years:
| | | | | | --- | --- | --- | --- | | Year | Total Coins and Notes? issued by the Government (MO) S.Pound billion | TOTAL MONEY STOCK (M4) S. Pound bin. | Percentage of Real Debt-free Money to the Money Supply | | 1977??? ???????????????????????????????????????????? 8.1????????? ??????????????????????????????? 65??????????? ???????????????????? ?? 12% 1979??? ?????????????????????????????????????????? 10.5????????? ??????????????????????????????? 87??????????????????????? ??????????? 12% 1981??? ????????????????????????????????????????? 12.1?????????? ????????????????????????????? 116??????????????????????????? ??????? 10.5% 1983??? ????????????????????????????????????????? 12.8?????????? ????????????????????????????? 161??????????? ???????????????????????? 7.9% 1985??? ???????????? ????????????????????????????14.1??????????? ????????????????????????????? 205??????????? ???????????????????????? 6.8% 1987??? ???????????????????????????????????????? 15.5????????????????????????????????????????? 269??????????? ???????????????????????? 5.8% 1989??? ???????????????????????? ????????????????17.2??????????? ????????????????????????????? 372??????????????????????? ??????????? 4.6% 1991??? ???????????????????????????????????????? 18.6???????????????????????????????????????? 485 ??????????????????????????????????? 3.8 % 1993 ?? ?????????????????????????????????????????20.0??????????? ???????????????????????????? 525????????????????????????????? ?????? 3.8% 1995??? ???????????????????????????????????????? 22.4??????????? ???????????????????????????? 585 ???????????????????????????????????? 3.8% 1997??? ??????????????????????????????????? ????25.0 ???????????????????????????????????????? 680 ??????????????????????????????? ??? 3.6% | | | |
This table" shows that the money created by the. banks has been growing with a galloping speed throughout the two decades until it reached 680 billion pounds in 1997. The last column of the table shows the yearly declining percentage of the real money to the total money supply which fell from 12% in 1977 to 3.6% in 1997
This phenomenon unveils two realities. Firstly, it shows that 96.4 % of the total money supply is debt‑ridden money and only 3.6 % is debt‑free. One can imagine how the whole economy is drowned under debt. Secondly, it means that 96.4 % of the aggregate money circulated in the country is nothing but numbers created by computers, having no real thing behind them..
The position in USA is almost the same as that in U.K. Patrick S.J. Carmack and Bill Still observe about it as follows:
"Why are we over our head in debt? Because we are labouring under a debt‑money system, in which all our money is created in parallel with an equivalent quantity of debt, that is designed and controlled by private bankers for their benefit. They create and loan money at intereset, we get the debt ....
So, although the banks do not create currency, they do create checkbook money, or deposits, by making new loans. They even invest some of this created money. In fact, over one trillion dollars of this privately‑created money has been used to purchase U.S. bonds on the open market, which provides the banks with roughly 50 billion dollars in interest, less the interest they pay some depositors. In this way, through fractional reserve lending, banks create far in excess of 90% of the money, and therefore, cause over 90% of our inflation".
"This (monetary management) a Government does by lowering or raising interest rates. This alternately encourages or discourages borrowing, thereby speeding up or slowing down the creation of money and the growth of the economy .... The fact that, by‑ this method, people and businesses with outstanding debts can be suddenly hit with huge extra charges on their debts, simply as a management device to deter other borrowers, is an injustice quite lost in the almost religious conviction surrounding this ideology...
This method of controlling banks, inflation and. money supply certainly works; it works in the way that a sledge‑hammer works at carving up a roast chicken. An economy dependent upon borrowing to supply money, strapped to a financial system in which both debt and the money supply are logically bound to escalate, is punished for the borrowing it has been forced to undertake. Many past borrowers are rendered bankrupt, homes are repossessed, businesses are ruined and millions are thrown out of work as the economy sinks into recession. Until inflation and overheating are no longer deemed to be a danger, borrowing is discouraged and the economy becomes a stagnating sea of human misery. Of course, no sooner has this been done, than the problem is lack of demand, so we must reduce interest rates and wait for the consumer confidence and the positive investment climate to return. The business cycle begins all over again ‑ There could be no greater admission of the utter and total inadequacy of modern economics to understand and regulate the financial system than through this wholesale entrapment and subsequent bludgeoning of the entire economy. It is a policy which causes illegality, as well as breaching morality, in the cavalier way in which the financial contract of debt is effectively rewritten at will, via the power of levying infinitely variable interest charges."'
"The money‑must‑grow imperative is ecologically destructive... It also results in a massive worldwide diversion of effort away from providing useful goods and services, into making money out of money. At least 95% of the billions of dollars transferred daily around the world are of purely financial transactions, unlinked to transactions in the real economy.
People are increasingly experiencing the workings of the money, banking and finance system as unreal, incomprehensible, unaccountable, irresponsible, exploitative and out of control. Why should they lose their houses and their‑jobs as a result of financial decisions taken in distant parts of the world ? Why should the national and international money and finance system involve the systematic transfer of wealth from poor people to rich people, and from poor countries to rich countries ? Why someone in Singapore be able to gamble on Tokyo Stock Exchange and bring about the collapse of a bank in London ? ... Why do young people trading in derivatives in the City of London get annual bonuses larger than the whole annual budgets of primary schools ? Do we have to have a money and financial system that works like this? Even the financier George Soros has said ("Capital Crimes", Atlantic Monthly, January, 1997) that "the untrammeled intensification of laissez‑faire capitalism and the extension of market values into all areas of life is endangering our open and democratic society. The main enemy of the open society, I believe, is no longer the Communist but the Capitalist Threat."
Interest and Indexation
Some appellants have tried to justify the interest charged and paid by the banks on the ground that since the value of money is decreasing constantly, the interest should be taken as a compensation for the erosion of the value of money during the period of borrowing. The financier, according to them, should have a right to claim at least the same amount in real terms as he had advanced to the borrower, but if his principal is repaid to him in the same numerical terms, he will not receive the same purchasing power as he had advanced to his debtor, because the inflation would have eroded a substantial part of the real value of money. Therefore, they argue, the interest is paid to compensate the loss the financier has suffered through inflation.
This argument is without force because the rates of interest are though a major cause of inflation among other factors, they are not based on the rate of inflation. Had it been a compensation for inflation, the rate of interest should have always matched the rate of inflation, and obviously this is not the case. The rates of interest are determined by the demand and supply of money and not by the rate of inflation at the time of the contract. If at any given time both rates match each other, it may be by chance and not as a matter of principle. Therefore, the interest cannot be held as a compensation for the loss of purchasing power.
Some other quarters have taken the aspect of inflation from another angle. They do not claim that interest, as in vogue, is a compensation for the loss caused by inflation. However, they suggest that indexation of loans can be a suitable substitute for the present interest‑bearing loans. They argue that the' financier should be compensated for the erosion of the value of money he had advanced to the borrower and, therefore, he can claim an additional amount matching the rate of inflation. Thus, according to them, indexation may be introduced into the banking system as an alternative for interest. ??
But without going into the question whether indexation of loans are or are not in conformity with Shariah, this suggestion is not practical so far as the banking transactions. are concerned. The reason is obvious: The concept of indexation of loans is to give the real value of the principal to the financier based on the rate of inflation, and therefore, there is no difference between depositors and borrowers in this respect. It means that the bank will receive from its borrowers the same rate as it will have to pay to its depositors, both being based on the same measure i.e. the rate of inflation. Thus, nothing will be left for the banks themselves, and no bank can be run without a profit. Mr. Khalid M. Ishaq, Advocate, who seemed to be inclined towards indexation, was asked by the Bench how the banking system can be established on the basis of indexation alone. He frankly admitted that he had no ready answer but the suggestion should be considered in depth. Some bankers who appeared to assist the Court, especially Mr. Abdul Jabbar Khan, the former President of the National Bank of Pakistan, gave his absolute opinion that the suggestion of taking indexation as a substitute of interest is not practicable from banking point of view.
It is clear from this discussion that neither the present interest rates can be justified on the basis of inflation, nor can indexation be used as a substitute for interest in the present banking system.
However, the question of erosion of the value of money is certainly relevant to the individual loans and .unpaid debts. There are many cases where the creditors really face hardships, especially where the value of the currency fell to an unimaginable extent, as happened in Turkey, Syria, Lebanon and in the States of the former Soviet Union. In our country too, the value of the rupee today is much less than it was before 1970. The question is whether a person who has advanced a sum of Rs.1,000 before 1970 and the debtor did not pay the principal till today is entitled to get the same Rs.1000, while this amount has remained not more than Rs.100 in real terms? This question is more severe where the debtor did not pay despite his being able to pay.
In order to solve this problem, many suggestions have been proposed by different quarters, some of which are the following:
(a)??????? That the loans should be indexed, meaning thereby, that the debtor must pay an additional amount equal to the increase in the rate of inflation during the period of borrowing.
(b)??????? That the loans should be tied up with gold, and it should be presumed that the one who has loaned Rs.1,000 has actually loaned as much gold as could be purchased on that date for Rs.1,000 and must repay as much rupees as are sufficient to purchase that much of gold.
(c)??????? That the loans should be tied up by a hard currency like dollar.
(d)??????? That the loss of the value of money should be shared by both creditor and lender in equal proportion. If the value of money has declined at a ratio of 5 % , 2.5 % should be paid by the debtor and the rest should be borne by the creditor, because the inflation is a phenomenon beyond the control of either of them. Being a common suffering, both should share it.
But we feel that this question needs a more thorough research which before its final decision in this Court should first be initiated by different study circles of the country, especially, by the Council of Islamic Ideology and the Commission for the Islamization of Economy. Many international seminars have been held to deliberate on this issue. The papers and resolutions of these Seminar should be analyzed in depth.
On the other hand, having held that this question does neither justify interest nor provides a substitute for it in the banking transactions, we do not have to resolve this issue in this case , nor does the decision about the laws under challenge depend on it. We, therefore, leave the question open for further study and research.
Mark‑up‑ and Interest
Some appellants have argued that although the interest is prohibited by the Holy Qur'an and Sunnah, the present banks do not deal in interest. Instead, they charge mark‑up from their customers. Mr. Haafiz S.A. Rahman, the learned counsel for the Agricultural Development Bank of Pakistan gave a detailed history of the legal steps taken by the Government of Pakistan to eliminate interest from its economy. According to him, effective from 1‑4‑1998, all types of finance to all types of clients including individuals were obligated to be designed on interest‑free basis. On 1‑7‑1995 interest bearing deposits ceased to be accepted and the deposits were‑ ordered to be based on PLS (profit and loss sharing) basis except the current accounts which do not attract any return. In order to implement this directive, the State Bank of Pakistan allowed 12 modes of financing, all free of interest, for the banks and financial institutions. The Government has also brought amendments to a large number of financial laws to eliminate interest from the economy. After all these steps are taken, interest is no more applicable in the banking transactions of the country. All the banks today are working under 12 modes of financing announced by the State Bank of Pakistan. The appellants argued that since the interest has already been abolished, the respondents have no reason to pray for elimination of interest.
The history given by Haafiz S.A. Rahman is essentially true and it is correct that the State Bank of Pakistan had suggested 12 modes of financing instead of interest, but the practical position on the ground is that out of all these 12 modes only 2 or 3 modes are normally being used by the banks and financial institutions, the foremost among them being mark‑up. But the way the mark‑up is used by the banks today is nothing but a change of nomenclature of the transaction. Practically what is being done is to replace the name of interest by the name of mark‑up. The concept of mark?up was originally presented by the Council of Islamic Ideology in its report on the Elimination of Riba submitted to the Government of Pakistan in 1980. The Council has in fact suggested that the true alternative to the interest is profit and loss sharing (PLS) based on Musharakah and Mudarabah. However, there were some areas in which financing on the basis of Musharakah and Mudarabah were not practicable. For these areas the Council has suggested a technique usually known in the Islamic banks as Murabahah. According to this technique the financier bank, instead of advancing a loan in the form of money, purchases the commodity required by the customers from the market and then sells it to the customer on deferred payment basis retaining a margin of mark‑up (profit) added to its cost. It was not a financing in its strict sense. It was rather a sale of a commodity effected in favour of the client. The very concept of this transaction implies the following points:
(a)??????? This type of transaction may be undertaken only where the client of a bank wants to purchase a commodity. This type of transaction cannot be effected in cases where the client wants to get funds for some other purpose than purchasing a commodity, like overhead expenses, payment of salaries, settlement of bills or other liabilities.
(b)??????? To make it a valid transaction it was necessary that the commodity is really purchased by the bank and it comes into the ownership and possession (physical or constructive) of the bank so that it may assume the risk of the commodity so far as it remains under its ownership and possession.
(c) After acquiring the ownership and possession of the commodity it should be sold to the customer through a valid sale.
(d) The Council has also suggested that this device should be used to the minimum extent only in cases where Musharakah or Mudarabah are not practicable for one reason or another.
Oarz and Qiraz
Dr. M. Aslam Khaki, the appellant in Shariat Appeal No. l (S) of 1992 was not a party to the proceedings in the Federal Shariat Court in these cases. However, the matter being of general importance we heard him at A length. In the memo. of his appeal he had adopted almost the same lines of A argument as we have already dealt with but while appearing in the Court his arguments were on totally different lines. He expressed his opinion that if the financing transaction stipulates a fixed return to the financier regardless of .whether the financed party has gained a profit or suffered a loss, it should be regarded as Riba. But if the financing transaction contemplates that in the case of a loss, the loss will be shared by both the parties in proportion to their respective investments, this much is enough to validate the transaction after which the parties can agree on a condition that if the business gains a profit a certain rate of profit attributable to the original investment of the financier will be deserved by him. It will become a transaction of Qiraz which is not impermissible in Shariah.
At the first place, this standpoint does not save the laws under consideration from the attack of the respondents because these laws ensure a fixed return to the financier in any case, therefore, his appeal, to save the said laws from being declared as repugnant to the Injunctions of Islam, is misconceived. His standpoint can be considered only in the context of finding out alternatives to the interest in our banking system. But his view is not supported by the Holy Qur'an and Sunnah, nor by any jurist , throughout the fourteen centuries. Qiraz is a term used in the literature of the Islamic Fiqh as a synonym to Mudarabah and all the schools of Islamic Fiqh are unanimous on the point that in an agreement of Mudarabah no rate of profit attributable to the investment can be allocated for the financier. Any such arrangement has been held by the jurists, as impermissible. The standpoint of the appellant is contradictory in itself because he admits that in the case of loss, the financier does not deserve any profit but on the other hand if the financier has stipulated i0% of his investment as his share in the profit of the business, it is acceptable to the appellant. But what will happen if the whole profit is not more than 10% . In this case the whole profit according to him will be secured by the financier and the Mudarib will get nothing, despite the business having earned a profit. This view is, therefore, fallacious on the face of it.
Riba and Doctrine of Necessity
Lastly, some appellants have tried to attract the doctrine of necessity to the case of Riba. Mr. Siddiq Al‑Farooq, the Managing Director of House Building Finance Corporation (HBFC) argued that the Holy Qur'an has allowed even to eat pork in the case of extreme hunger to save one's life. The argument of some appellant was that the interest‑based system has now become a universal necessity and no country can live without it. Interest is no doubt prohibited by the Holy Qur'an but to implement this prohibition at country level may be a suicidal act which may shatter the whole economy, therefore, it should not be declared as repugnant to the Injunctions of Islam. Some appellants have argued that the whole world today is turning into a global village and no country can survive in seclusion, especially, our country which is drowned in debts and its most development projects depend chiefly on the foreign loans based on interest. Once the prohibition of interest is enforced at a wholesale basis all the development projects will breath their last and the whole economy will face a sudden collapse.
We have given due attention to this line of argument and examined this aspect seriously with the assistance of a number of economists, bankers and professional practitioners. No doubt, Islam is a realistic religion and it never binds an individual or a State with a command, the implementation of which is beyond its. control. The doctrine of necessity is one of the doctrines enshrined and developed by the Holy Qur'an and Sunnah and expounded by the Muslim jurists. It is rightly pointed out by Mr. Siddiq Al?Farooq that the Holy Qur'an has allowed even to eat pork in a case of extreme hunger where the life of a human being cannot be saved without it. But the doctrine of necessity in Islam is not an obscure concept. There are certain criteria expounded by the Muslim jurists in the light of the Holy Qur'an and Sunnah to determine the magnitude of necessity and the extent to which a Qur'anic command can be relaxed on the basis of an emergent situation. Therefore, before deciding an issue on the basis of necessity one must make sure that the necessity is real and not exaggerated by imaginary apprehensions and that the necessity cannot be met with by any other means than committing an impermissible act. When we analyze the case of interest in the light of the above principles we are of the firm view that there is a great deal of exaggeration in the apprehension that the elimination of interest will lead the economy to collapse. For a realistic analysis we will have to consider the domestic transactions and the foreign transactions separately.
Domestic Transactions
In the domestic transactions the apprehension against the elimination of interest is often based on some misconceptions. There are many people who think that abolishing interest means to turn the banks into charitable institutions and that the banks, in an Islamic system, will advance money with no return and the depositors will get nothing on their money held in the banks. Obviously, this misconception is based on sheer ignorance of the Islamic principles. We have already discussed at length the concept of a loan in Islam and that its role in the commercial economy is very limited. What is meant by islamizing the banks and financial institutions is not to advance money without return; what it does mean is that the banks will finance on the basis of profit and loss sharing, and other Islamic modes of financing, none of which is devoid of return.
Some other people are of the view that the alternative banking system based on Islamic principles has not yet been designed nor practised, and therefore, by implementing it abruptly we will enter into a dark and obscure area and subject ourselves to unseen dangers that may bring total disaster to our economy.
This apprehension is also based on unawareness of the new thoughts about the present financial system and about what is happening in the field of Islamic banking for the last three decades. The fact is that Islamic banking is no longer a fanciful or utopian dream. Muslim jurists and economists are Working on various aspects of Islamic banking from different dimensions for the last 50 years, and it is from the 1970s that the concept of Islamic banks has been translated into real institutions working on the Islamic lines. The number of Islamic banks and financial institutions throughout the world has been growing during the last 3 decades. As stated by Mr. Iqbal Ahmad Khan, the head of the Islamic banking division of HSBC London who appeared in this case as a jurisconsult, the number of Islamic banks and financial institutions has now reached more than 200 across 65 countries of the world with US$ 90 billion capital at a growth rate of 15% p.a. By the year 2000 the Islamic Finance Industry is expected to be a US$ 100. billion plus business.
The present Islamic Development Bank (IDB) based in Jeddah was established in 1975 by the Organization of Islamic Conference (OIC) as a pioneer of Islamic banking. This bank was originally meant for inter?governmental financial transactions providing funds for development projects in the member countries. But it is now providing trade finance facilities to the private sector also. This bank has its own research centre working on different issues of Islamic banking and economy. The Court invited this bank to send some of its experts to assist the Court and to throw light on the working of the Islamic banks and the feasibility of the proposals presented so far for transforming the banking system to the Islamic ways of financing. The bank was kind enough to send a high level delegation headed by the President of the Bank Dr. Ahmad Muhammad Ali himself. Several members of the delegation, including the President of the Bank, addressed the Court and have submitted their report in writing. Details apart, the substance of their submissions is summarized in their own words as follows:
"The experience accumulated by Islamic banks, in general, and the Islamic Development Bank in particular, as well as attempts made in a number of Muslim countries to apply an Islamic financial system, indicate that the application of such an Islamic system by any Muslim country, at the national level, is feasible. According to the data compiled by the International Union of Islamic Banks, there are 176 Islamic banks and institutions in the world. In terms of number, 47 % of these institutions are concentrated in South and South East Asia, 27% in GCC and Middle East, 20% in Africa and 6% in the Western countries. In terms of deposits, amounting to US$112.6 billion and total assets amounting to US$ 147.7 billion. 73 % of the activities of these institutions are concentrated in the GCC and the Middle ‑East. IDB alone, since its inception from 1976 to 1999, has provided financing in the range of US$21. billion. As against a growth rate of 7 % per annum recorded by the global financial services industry, Islamic banking is growing at a rate of 10‑15% per annum and accounts for 50‑60% of the share of the market in the GCC and Middle East."
"Islamic banking is distinctive in two respects: concentrating on the real sector of the economy, it imparts tremendous stability to the economic system by achieving an identity between monetary flows and goods sand services, and by operating on a system of profit and loss sharing in its evolved State, it insulates the society from the debt‑mountain on the analogy that if the economies enter into recessionary or deflationary phases, the principles of profit and loss sharing protects the states arid economic operators from the evils of accumulation of interest and minimizes defaults and bankruptcies."
Since the experience of Islamic banking is passing through its initial phase, the industry is facing numerous issues. These issues have given birth to a number of research institutes, study circles, training programmes and specialized groups. There is a large number of seminars, workshops and conferences, held every year in different parts of the world where the Muslim jurists, economists, bankers and practitioners sort out the practical problems and find out their solutions.
This does never mean that the Islamic banking industry has achieved the ultimate goal of its maturity. It certainly has its limitations. It may be suffering from a number of weaknesses. There are many issues yet to be resolved. But the progress made by the Islamic banks so far is sufficient to refute the misconception that it is a utopian idea, or that any advance in this direction will make us step into a void. This brief account does at least show that much of the ground work has been done in the field of Islamic banking, and while discussing the possibilities of the elimination of interest from the economy, this background cannot be ignored or undervalued.
Mr. M. Ashraf Janjua, the Chief Economic Advisor of the State Bank of Pakistan, has been nominated by the S BP as its representative during the hearing of this case. In his written statement submitted to the Court he has opined that shifting of the entire interest‑based, system to one that is free from interest is feasible, but it is a more complex and challenging task than the one undertaken by the private Islamic banks working in different part of the world.
We are not unconscious of the fact that elimination of interest from the entire economy is more complex and challenging in many respects than abolishing it from a single institution. But at the same time, there are many areas where establishing an interest‑free system is much easier for the Government than it was for the private Islamic banks. The Islamic banks working in different parts of the world do not enjoy any support from their respective governments or the central banks for their interest‑free transactions. They have to submit to the legal framework and the regulatory requirements that are basically designed for interest‑based financing, but are imposed on the Islamic banks with the same force without the slightest change in favour of Islamic modes of financing. The Islamic banks are working with their hands tied by the conventional laws and regulations. If the interest‑free system is introduced by the Government itself at country level, the Government will be free to bring its own legal and regulatory framework and the difficulties faced by the private Islamic banks will create no problem for the Government. Moreover, the Islamic banks have to compete the conventional banks. Any client not happy with the arrangement offered by the Islamic banks can easily go to a conventional bank, the other alternative being readily available. If the Islamic modes are enforced at country level, and no bank offers an interest‑based arrangement, this problem can easily be overcome. The correct position, therefore, is that abolishing interest at country level is easier in some respects and more difficult in some others. To be realistic, we should realize both aspects while determining the time frame for conversion. Let us now examine the main features of the proposed system of Islamic banking.
Profit and Loss Sharing
"Why was the process of issuing new. money into economy (i.e. credit creation) been delegated by governments to the banks, allowing them to profit from issuing it in the form of interest ?bearing loans to their customers? Should governments not issue it directly themselves, as a component of a citizen's income"?
"Would it be desirable and possible to limit the role of interest more drastically than that, for example by converting debt into equity throughout the economy? This would be in line with Islamic teaching, and with earlier Christian teaching, that usury is sin. Although the practical complications would make this a goal for the longer term, there are strong arguments for exploring it ‑ the extent to which economic life worldwide now depends on ever‑rising debt, the danger of economic collapse this entails, and the economic power now enjoyed by those who make money out of money rather than out of risk‑bearing participation in useful enterprises.'
"Converting debt to equity is not a panacea for all economic ills. It can, however, produce many positive benefits. These benefits will not necessarily follow automatically from conversion. Concentrated effort will be required to ensure they do. Without conversion they will not happen at all.
Not the least of these benefits will be those brought to the banking community itself. The banking and monetary system will not collapse. Nor should there ever need to be the threat of collapse again. Owners of banks will find the value of their shares underpinned as liabilities disappear from balance sheets and are replaced by assets of a specific value. Each and every depositor will be able simultaneously to withdraw his or her total deposits.
Demand for the bank's current or cheque account services will not diminish. Longer term depositors will now have to pay for storage: it will be a less attractive option than exchange, so the velocity with which money moves from bank to market‑place to bank again, from one account to another, is likely to increase. There will be a continuous flow of money available for new equity investment.
The market‑place in general will also receive benefits. Conversion will also cause the value of money to stabilize. Savings can then retain their value. Prices need only vary according to the supply and demand of the product being priced. Measurements of exchange value made by different people at different times can be validly compared. The unit of money will once more be a valid unit of measurement of exchange value. The field of economics can become a science.
Many of the distortions which now exist in our individual frames of reference will be corrected. For instance, an investment which took an investor, ten, fifteen or twenty years to recoup used to be considered sound. Now, too often the maximum period envisaged is five years; even three. This short‑term view has precluded many useful businesses from being created. The re‑establishment of stable money and the emphasis on security which will be required within equity investment programme will encourage people to take a longer view. More businesses will then be considered viable and the number of new jobs can increase dramatically.
Existing savers will also be protected. The conversion to equity will eliminate the possibility of collapse for individual banks and for the system as a whole. Savings will not disappear. The nature of savings will change from just units of money to units, of money and shares. The exchange value of both the shares and the money will have to be re‑assessed. But they will have value. If no action is taken and the system collapses, they may end up having no value.
The changes proposed will also free many from the enslavement of debt. Both nations and individuals can regain their dignity. They will be free to make their own choices. No longer will managers have to face the choice between paying interest and disemploying some or not paying interest and disemploying all.
Nor shall we need to experience the stresses caused by current economic and business cycles. There will be a steady flow of money into investments. New investment opportunities will continually be sought as a home for both individual saving and business profits. Both will wish to avoid storage charges.
Growth will be dependent upon the continuing development of new ideas and new productive capacity. Growth will no longer be dependent upon the creation of new debt. Economic expansion will depend upon the positive flow of new savings and new profits.
Re‑establishing the integrity of money will eliminate at least one of the causes of human conflict. Money will no longer secretly steal from those who save, those on fixed income and those who enter long‑term contracts. .
Further, it can lead to a greater premium being placed on personal integrity. The character traits of honest, honourable and forthright behaviour will 'be in demand. Investors' security will depend on them. Recognition of the degree of interdependence in an equity? oriented market‑place can lead to more consideration of the needs of others, and, ultimately, to a more caring and, compassionate society.
Of course, life is never roses all the way. Many mistakes will be made. When new paths are trodden, ‑ the way is sometimes uncertain. Some will find it difficult to break the habitual patterns of thought which govern behaviour in a debt‑oriented society. No ' doubt some readers will have already experienced this.
Some will be hard‑pressed when the actual exchange value of their investments becomes apparent. Yet, the conversion process can be controlled. Collapse cannot. We should be able, as part of the conversion process, to identify those who might suffer unduly. Then we can be prepared to assist them and cushion any hardship.
The case of honest money is a compelling one. Honest money is not a thief. It does not steal from the thrifty. It is not socially divisive. It does not promote economic and business cycles, creating unemployment. On the contrary, it encourages thrift. It promotes sustainable economic growth. It rewards merit. It demands integrity.
These were worthwhile goals. They can be achieved. What is needed now is the will to make them happen."
"One of the most unusual and original contributions to the monetary debate. John Tomlinson is a former merchant banker and presents a powerful case against the debt‑based money system; his solution is highly creative and shows the scope for thought outside the normal parameters of monetary reform. The work is currently being incorporated by Nova University in America as part of their master degree in economics.
"Although this long term shift from a bond‑based to an equity? based financial system accords in many respects with Islamic economic principles, it is a trend which is by no means confined to the Islamic world and which is increasingly being championed globally. The resurgence in Islamic finance worldwide is seen by some simply as a reflection of the global economy's discernible transition from bond‑based to equity‑based finance.
Consider, for example, the strategy of a developed, non‑Muslim but heavily indebted economy such as Italy. Under the terms of privatization programme which gathered momentum in 1995 and 1996, Italian law stipulates that ????.all the proceeds of the privatisation? of public companies become part of a sinking fund that, by law, can only be used to retire debt, and is not applied towards the reduction of the PSBR.' Perhaps, indeed, the Western world has been gravitating towards Islamic principles of finance without knowing it over the last three decades.
"As shown in a recent paper by Khan (1985) this system of investment deposits is quite closely related to proposals aimed at transforming the traditional banking system to an equity basis made frequently in a number of countries, including the United States."
Peter Warburton has also preferred an equity‑based financial system and has discussed the theories of Fisher, Minsky, J.Presley and P.Mills in this, respect.
?209. Thus, the equity‑based banking is not something proposed by the Islamic circles alone. It is being suggested also by some non‑Muslim economists on purely economic grounds. The injustice, instability and business shocks created by the present debt‑based financial system have themselves compelled them to think about an equity‑based system that has more potential to bring about distributive justice and stability. In an equity? based banking the depositors are expected to gain much more than they are receiving today in the form of interest which often becomes negative in real terms by the inflation caused mainly by the expansion of the debt‑based money. It will divert the flow of wealth towards the common people and in turn will encourage savings and bring a gradual and balanced prosperity.
Some objections on Musharakah Financing
??????? Risk of Loss:
It is argued that. the arrangement of Musharakah is more likely to pass on losses of the business to the financier bank or institution. This loss will be passed on to depositors .also. The depositors, being constantly exposed to the risk of loss, will not like to deposit their money in the banks and financial institutions and, thus, their savings will either remain idle or will be used in transactions outside the banking channels, which will not ` contribute to the economic development at national level.
This argument is, however, misconceived. Before financing on the basis of Musharkah, the banks and financial institution will study the feasibility of the proposed. business for which funds are needed. Even in the present system of interest‑based loans the banks do not advance loans to each and every applicant. They study not only the financial position of the client, but in some cases they have to examine the potentials of the business and if they apprehend that the business is not profitable, they refuse to advance a loan. In the case of Musharakah, they will have to carry out this study at a wider scale with more depth and precaution, but this extra work will certainly contribute a lot to the betterment of the economy as a whole.
Moreover, no bank or financial institution can restrict itself to a single Musharakah. There will always be a diversified portfolio of Musharakah. If a bank has financed 100 of its clients on the basis of Musharakah, after studying the feasibility of the proposal of each one of them, it is hardly conceivable that all of these Musharakahs, or the majority of them will result in a loss. After taking proper measures and due care, what can happen at the most is that some of them make a loss. But on the other hand, the profitable Musharakahs are expected to give more return than the interest‑based loans, because the actual profit is supposed to be distributed between the client and the bank. Therefore, the Musharakah portfolio, as a whole, is not expected to suffer loss, and the possibility of loss to the whole portfolio is merely a theoretical possibility which should not discourage the depositors. This theoretical possibility of loss in a financial institution is much less than .the possibility of loss in a joint stock company whose business is restricted to a limited sector of commercial activities. Still, the people purchase its shares and the possibility of loss does not refrain them from investing in these shares. The case of the bank and financial institutions is much stronger, because their Musharakah activities will be so diversified that any possible loss in one Musharakah is expected to be more than compensated by the profits earned in other Musharakahs. The experience of Pakistani banks is an empirical evidence. Since 1‑7‑1995 all the deposits in Pakistan are based on profit and loss sharing basis, except current account. No guarantee even of the principal, is provided to the depositors by the banks, and, thus, the liabilities side of our present banks is fully equity‑based. Still, the deposits are being made as before.
Apart from this, an Islamic economy must create a mentality which believes that any profit earned on money is the reward of bearing risks of the business. This risk may be minimized through expertise and diversifying the portfolio where it may become a hypothetical or theoretical risk only. But there is no way to eliminate this risk totally: The one who wants to earn profit, must accept this minimal risk. Since this understanding is already there in the case of normal joint stock companies, nobody has ever raised the objection that the money, of the shareholders is exposed to loss. The problem is created by the system that separates the banking and financing from the normal trade activities, and which has compelled the people to believe that banks and financial institutions deal in money and papers only, and that they have nothing to do with the actual results emerging in trade and industry. It is this basic premise on the basis of which it is argued that they deserve a fixed return in any case. This essential separation of financing sector from the sector of trade , and industry has brought great harms to the economy at macro‑level. Obviously, when we speak of Islamic banking, we never mean that it will follow this conventional system in each and every respect. Islam has its own values and principles which do not believe in separation of financing from trade and industry. Once this Islamic system is understood, the people will invest in the financing sector, despite the theoretical risk of loss, more readily than they invest in the profitable joint stock companies.
2.???????? Dishonesty
Another apprehension against Musharakah financing is that the dishonest clients may exploit the instrument of Musharrakah by not paying any return to the financiers. They can always show that the business did not earn any profit. Indeed, they can claim that it has suffered a loss in which case not only the profit, but also the principal amount will be jeopardized.
It is, no doubt, a valid apprehension, especially in societies where corruption ‑is the order of the day. However, solution to this problem is not as difficult as is generally believed or exaggerated.
If all the banks in a country are run on pure Islamic pattern with a careful support from the Central Bank and the Government, the problem of dishonesty is not hard to overcome. First of all, the system of credit rating will have to be implemented with full force. Every company or corporate body should be compelled by law to subject itself to an independent credit rating. Even. the big firms seeking finance above a certain level may also be subjected to the same rule. Secondly, a well‑designed system of auditing should be implemented whereby the accounts of all the clients are fully maintained and properly controlled. According to some contemporary scholars, profits may be calculated on the basis of gross margins only. It will reduce the possibility of disputes and misappropriation. However, if any misconduct, dishonesty or negligence is established against a client, he will be subjected to punitive steps, and may be deprived of availing any facility from any bank in the country, at least for a specific period.
These steps will serve as strong deterrent against concealing the actual profits or committing any other act of dishonesty. Otherwise also, the clients of the banks cannot afford to show artificial losses constantly, because it will be against their own interest‑in many respects. It is true that even after taking all such precautions, there will remain a possibility of some cases where dishonest clients may ‑succeed in their. evil designs, but the punitive steps and the general atmosphere of the business will gradually reduce the number of such cases. (Even in an interest‑based economy, the defaulters have always been creating the problem of .bad debts). But it should not be taken as a justification, or as an excuse, for rejecting the whole system of Musharakah.
Murabahah Transaction
Moreover, Islamic banking is not restricted to profit and loss sharing.. Though Musharakah is the ideal mode of financing that fully conforms, not only to the principles of Islamic jurisprudence, .but also to the E basic philosophy of an Islamic economy, yet there is a variety of instruments E that may be used on the assets side of the bank, like Murabahah, leasing, salam, istisna, etc. Some of these models are less risky and may be adopted where Musharakah has abnormal risks or is not applicable to a particular transaction. Some of the appellants have complained that the Federal Shariat Court, in its impugned judgment, has declared the mark‑up system, too, as against the Injunctions of Islam. It means that Murabahah cannot be used by an Islamic bank as a permissible mode of financing.
This complaint is misconceived. The Federal Shariat Court has not held the Murabahah transaction as invalid ‑ in principle. It has rather suggested Murabahah for financing exports in para. 367 of its judgment. However, the Court has held the "mark‑up system as in vogue" to be against the Islamic Injunctions and has expressed its apprehension that this mode will be subject to misuse and, applied without fulfilling the necessary conditions on a large scale basis, it will bring little difference to the present . system. We have already observed that the "mark‑up system as in vogue in Pakistan" is not a Murabahah transaction in the least. It is merely a change of name. The purported sale of goods never takes place in real terms. If Murabahah is effected with all its necessary conditions, it is not impermissible in Shariah, nor has the Federal Court declared it as an absolutely impermissible transaction per se. We have already mentioned above while describing the background of the .objection of the infidels against the prohibition of Riba that "sale is similar to Riba" (in paras. 50 and 51 of this judgment) that they used to sell a commodity on deferred payment for a higher price. Their objection was that when they increase the price at the initial stage of sale, it has not been held as prohibited but when the purchaser fails to pay on the due date, and they claim an additional amount for giving him more. time, it is termed as `Riba' and haram. The Holy Qur'an answered this objection by saying "Allah has allowed sale and forbidden Riba".. As explained earlier. (in para 190 of this judgment) Murabahah is a sale and not a financing in its origin. It must, therefore, conform to all the basic standards of a sale. It may be used only where the client of the bank really wants to purchase a commodity. The bank must purchase it from the original supplier and after taking into its ownership and (physical or constructive) possession sells it to the client. All these elements must be visibly present in a valid Murabahah with all their legal and. logical consequences, including in particular, that the bank must assume the risk of the commodity so long as it remains in its ownership and possession. This is the basic ‑feature of the Murabahah which makes it distinct from an interest‑based financing and once it is ignored, though for the purpose of simplicity, the whole transaction steps into the prohibited field of interest ?based financing.
An objection frequently raised against a Murabahah transaction is that when used as a mode of financing it contemplates an increased price based on the deferred payment. It means that the price of commodity in a Murabahah transaction is more than the price of the same commodity in spot market. Since the price is increased against the time given to the purchaser, it resembles the interest‑based loan transaction.
We have already explained in paras. 136 to 140 of this judgment that. Islam has treated money and commodity differently. Having different characteristics both are subject to different rules and principles. Since money has no intrinsic utility, but is only a medium of exchange which has no different qualities, the exchange of a unit of money for another unit of the same denomination cannot be effected except at par value. If a currency note of Rs.1,000 ,is exchanged for another note of Pakistani rupees, it must ‑be of the value of Rs.1,000. The price of the former note can neither be increased nor decreased from Rs.1,000 even in a spot transaction, because the currency note has no intrinsic utility nor a different quality (recognized legally), therefore, any excess on either side is without consideration, hence, not allowed in Shariah. As this is true in a spot exchange transaction, it is also true in a credit transaction where there is money on both sides, because if some excess is claimed in a credit transaction (where money is exchanged for money) it will be against nothing but time.
222: The case of normal commodities is different. Since they have intrinsic utility and have different qualities, the owner is at liberty to sell them at whatever price he wants, subject to the forces of supply and demand. If the seller does not commit a fraud or misrepresentation, he can sell a commodity at a price higher than the market rate with the consent of the purchaser. If the purchaser accepts to buy it at that inereAsed price, the excess charged from him is quite permissible for the seller. When the seller can sell his commodity at a higher price in a cash transaction, he can also charge a higher price in a credit sale, subject only to the condition that he neither deceives the purchaser, nor compels him to purchase, and the buyer agrees to pay the price with hi
(a)??????? his shop is nearer to the buyer who does not want to go to the market which is not so near.
(b)??????? The seller is more trustworthy for the purchaser than others, and the purchaser has more confidence in him that he will give him the required thing without any defect.
(c)??????? The seller gives him priority in selling commodities having more demand.
(d)??????? The atmosphere of the shop of the seller is cleaner and more comfortable‑than other shops.
(e)??????? The seller is more courteous in his dealings than others.
These and similar other consideration play their role in charging a higher price from the customer. In the same way, if a seller increases the price because he allows credit to his client, it is not prohibited by Shariah if there is no cheating and the purchaser accepts it with open eyes, because whatever the reason of increase, the whole price is against a commodity and not against money. It is true that while increasing the price of the commodity, the seller has kept in view the time of its payment but once the price is fixed, it relates to the commodity, and not to the time, the price will remain the same and can never be increased by the seller. Had it been against time, it might have been increased, if the seller allows him more time after the maturity.
To put it another way, since money can only be traded in at par value, as explained earlier, any excess claimed in a credit transaction (of money in exchange of money) is against nothing but time. That is why if the debtor is allowed more time at maturity, some more money is claimed from him. Conversely, in a credit sale of a commodity, time is not the exclusive consideration while fixing the price. The price is fixed for commodity, not for time. However, time may act as an ancillary factor to determine the price of the commodity, like any other factor from those mentioned above, but once this factor has played its, role, every part of the price is attributed to the commodity.
The upshot of this discussion is that when money is exchanged for money, no excess is allowed, neither in cash transaction, nor in credit, but where a commodity is sold for money, the price agreed upon by the parties may be higher than the market price, both in cash and credit transactions. Time of payment may act as an ancillary factor to determine the price of a commodity, but it cannot act as an exclusive basis for and the whole consideration of an excess claimed in exchange of money for money.
This position is accepted unanimously by all the four schools of Islamic law and the majority of the Muslim jurists. This is the correct legal position of Murabahah transaction according to Shariah. However, two points must be remembered‑‑‑
(a)??????? the Murabahah when used as a mode of trade financing is borderline transaction with very fine lines of distinction as compared to an interest bearing loan. These fine lines of distinction can be observed only when all the basic requirements already explained are fully complied with. To ignore any one of them makes it an interest bearing financing, therefore, it should always be effected with due care and precaution.
(b)??????? Notwithstanding the permissibility of the Murabahah transaction, it is susceptible to misuse and keeping in view the basic philosophy of an Islamic financial system it is not an ideal way of financing.. Hence it should be used only where the Musharakah and Mudarabah are not applicable.
Apart from Musharakah and Mudarabah there are other modes of financing like Ijara (leasing), Salam and Istisna that can be used in different types of financing. We need not go into the details of these because they are elaborated in different reports submitted to the Government for the elimination of interest. The. first comprehensive report in this respect was submitted by the Council of Islamic Ideology in 1980. The second report was that of the Commission for Islamization of Economy, constituted under the Shariat Act. This Commission has submitted its comprehensive report to the Government in 1991. Lastly, the same Commission was reconstituted under the Chairmanship of Raja Zafarul Haq which submitted its final report in August, 1997. We have gone through all these reports and without commenting on each and every detail proposed in them we are satisfied that all these reports can at least be taken as the basic groundwork for bringing about the change in our present financial system.
The upshot of this discussion is that the Doctrine of Necessity cannot be applied to protect the present interest‑based system for ever or for an indefinite period. However, this doctrine can be availed of for allowing a reasonable time to the Government necessarily required for the switch‑over to an interest‑free Islamic financial system.
The Loans of the Government
Foreign Loans
Although the laws under challenge in the present case are not specifically related to the foreign borrowings; yet it is obvious that once the interest is held illegal, these transactions will also be hit by the prohibition in H some way or the other. This seems to be the most difficult area where the H prohibition of interest is required to be implemented. The Government's foreign loans as of 1‑3‑1999 stand $31.15 billion or Rs.1610 billion at‑the current inter bank rate. It is argued that conversion of this type of borrowing to an interest‑free basis is almost impossible.
Before we touch upon the Islamic solution to this problem we would like to observe that the speed at which our foreign borrowings are increasing merits serious consideration. In the beginning we started borrowing funds from international sources for our development projects. Later the scope of foreign borrowing was extended even to the non? development expenses. Thereafter huge amounts were borrowed for debt servicing and now these borrowings are meant to pay interest to the international lenders.
It needs no expertise in economics to realize that this is an alarming situation which is leading us constantly towards the slavery of the whole nation in the hands of our lenders. We are mortgaging the future of our present and coming generations by incurring huge debts every year. The notion that the foreign borrowings help the developing countries in their development projects and assist in attaining prosperity is now proved to be false in the case of a large number of the third world countries. This fact is increasingly realized by the independent economists. Susan George, an American economist living in France has written widely. on development and world issues. She is an Associate Director of the Transnational Institute in Amsterdam and her books on the Third World debt have been widely admired, some of which have won the international awards. She has summarized the eye‑opening results of the Third World debt in the following words:
"According to the OECD, between 1982 and 1990, total resource flows to developing countries amounted to $927 billion. This sum includes the OECD categories of Official Development Finance, Export Credits and Private Flows ‑ in other words, all official bilateral and multilateral aid, grants by private charities, trade credits plus direct private investment and bank loans. Much of this inflow was not in the form of grants but was rather new debt, on which dividends or interest will naturally come due in future.
During the same 1982‑‑90 period, developing countries remitted in debt service alone 1342 billion (interest and principal) to the creditor countries. For a true picture of resource flows, one would have to add many other South‑to‑North out‑flows, such as royalties, dividends, repatriated profits, underpaid raw materials and the like. The income‑outflow difference between $1345 and $927 billion is, thus, a much understated $418 billion in the rich countries' favour. For purposes of comparison, the US Marshall Plan transferred $14 billion 948 dollars to war‑ravaged Europe, about $70 billion in 1991 dollars. Thus in the eight years from 1982‑‑90 the poor have financed six Marshall Plans for the rich through 'debt service alone.
Have these extraordinary outflows at least. served to reduce the absolute size of the debt burden? Unfortunately not. In spite of total debt service, including amortization, of more than 1.3 trillion dollars from 1982‑‑90, the debtor countries as a group began the 1990s fully 61 per cent. more in debt than they were in 1982. Sub? Saharan Africa's debt increased by 113 per cent. during this period; the debt burden of the very purest the so‑called 'LLDCs' or `least developed' countries ‑ was up by 110 per cent."
Many neutral writers are of the view that Third World debt is not just a financial matter, but a political one.
There were always severe conditions attached to IMF and World Bank loans.
Although program aid' required borrowing nations to conform to a package of economic and social expenditure measures aimed to ensure that funds are used for development, yet when projects failed and debts increased,program aid' was followed by structural adjustment' that entailed supervising the development of the entire economy of the indebted countries. Thus, the lenders justified their total interference in the domestic policies of the Third World nations. As these policies, too, failed to bring a turnaround in the debt trends,austerity programs' were introduced whereby expenditure on social services, welfare and education were cut to a considerable extent. Susan George and Fabrizio Sabelli have commented on the results of these policies as follows: ,
"Between 1980 and 1989 some thirty‑three African countries received 241 structural adjustment loans.
During that same period, average GDP per capita in those countries fell 1.1 % per year, while per ,capita food production also experienced steady decline:
The real value of the minimum wage dropped by over 25 % , Government expenditure on education fell from $11 billion to $7 billion and primary school enrolments dropped from 80 % in 1980 to 69 % in 1990. The number of poor people in these countries rose from 184 million in 1985 to 216 million in 1990, an increase of seventeen per cent.
According to the assessment of the World Bank itself, which is subjected to serious doubts by some economists, the success rate of World‑Bank‑funded projects has been less than 50% . In addition, after a review in 1989, World Bank staff were unable to point out a single project in which the displaced people had been relocated and rehabilitated to a standard of living comparable to that which they enjoyed before displacement .
Even the successful projects did seldom bring an overall economic well‑being of the indebted countries. Michael Rowbotham says:
"There has been a massive outpouring of literature on the subject of Third World debt: The books are characterized by one feature. Whereas the arguments and policies of the IMF and World Bank have been based upon an apparently reasonable theory, the studies give case after case and country after country, in which the theory has not worked in practice. Either loans have led to development but repayment has proved impossible; or the projects funded have failed completely leaving the country with a massive debt and no hope of repayment, or repeated additional loans have become necessary simply to provide funds for the repayment of past loans. The debtor countries, as a group, began the 1990s fully 61 % deeper in debt than they were in 1980.
The system can be compared point by point with peonage on an individual scale. In the peonage, or debt slavery system... the aim of the employer/creditor/merchant is neither to collect the debt once and for all, nor to starve the employee to death, but rather to keep the labourer permanently indentured through his debt to the employer... Precisely the same system operates on the international level... It is debt slavery on an international scale. If they remain within the system, the debtor countries are doomed to perpetual underdevelopment or rather, to development of their exports at the service of multinational enterprises, at the expense of development for the needs of their own citizens ......
"In virtually all cases, the impact of these (IMF and World Bank) projects has been basically negative. They have resulted in massive unemployment, falling real incomes, pernicious inflation, increased imports with persistent trade deficits, net outflow of capital, mounting external debts, denial of basic needs, severe hardship and deindustrialization. Even the so‑called success stories in Ghana and the Ivory Coast have turned out to offer no more than temporary relief which had collapsed by the mid 1980s. The sectors that have been worst hit are agriculture, manufacturing and the social services, while the burden of adjustment has fallen regressively on the poor and weak social groups.
"The foreign‑aid‑based development model has proved itself powerless to bring a single country out of economic and financial dependence. However, it has turned out to be a source of fabulous wealth, for certain Third World elites , giving birth to a new form of power and a socio‑political class that can rightly be called the
aidocracy".
The case of Pakistan is not much different. At a time when we are in the dire need to improve the economic status of our people, to eradicate poverty, to raise the level of our education, and to provide at least the minimum health requirements to our rural areas where thousands of men, women and children are at the edge of death for the want of any medical aid, we are forced to allocate 46 % of our total budget roc repayment of interest‑based loans. Still, we are striving to acquire more loans to pay off some of the previous ones. When these new loans will mature, we will have to incur more debts to satisfy‑ some of the present liabilities. How far can we proceed in this vicious circle? How long shall we keep coiling around the spiral of loans over loans? We will have to get rid of this debt‑based economy which has usurped our freedom and has pawned our next generations in the hands of our lenders. This is a question of life‑and‑death of our nation,. and we will have to resolve it at any cost.
"A change to Islamic modes of financing has been considered by IFC, but this would be contrary to the Government of Pakistan's intentions for foreign loans.
Adoption by a foreign lender of Islamic instruments could .be construed as undermining Government's policy to exempt foreign lenders from this requirement.
On November 17, 1990, the Prime Minister of Pakistan had appointed a committee of experts to analyze the growing dependence of our country on foreign assistance and to chalk‑ out a plan to reduce this dependence and evolve a self‑reliance development strategy. The committee, headed by the then Senator Prof. Khurshid Ahmad, comprised the Secretary, Finance Division and the Chief Economist of the Economic division and several other economic experts. The report of the Committee was submitted to the Government in April 1991. This Committee, after deliberations, came to the conclusion that even on pure economic grounds, the goal of self‑reliance can be achieved only by elimination of interest. . The recommendations of this committee can be availed of while tackling with the issue of foreign loans.
Therefore, the admitted difficulties in resolving the problem of foreign liabilities cannot be taken as an excuse for exempting them from the prohibition for good or for an indefinite period on the basis of necessity. However, it cannot be denied that it will take more time than the domestic transactions. The doctrine of necessity will be applicable to this extent only.
Conclusions
The upshot of the above discussion is that: ???????????
Any additional amount over the principal in a contract of loan or debt is the Riba prohibited by the Holy Qur'an in several verses. The Holy Prophet (p.b.u.h.) has also termed the following transactions as Riba:
(i)???????? A transaction of money for money of the same denomination where the quantity on both sides is not equal, either in a spot transaction or in a transaction based on deferred payment.
(ii)??????? A barter transaction between two weighable or measurable commodities of the same kind, where the quantity on both sides is not equal, or where the delivery from any one side is deferred.
(iii) A barter transaction between two different weighable or measurable commodities where delivery from one side is deferred. ????????
These three categories are termed in the Islamic jurisprudence as Riba‑al‑Sunnah because their prohibition is established by the Sunnah of the Holy Prophet (p.b.u.h.). Alongwith the Riba‑al‑Qur'an, these are four types of transactions termed as `Riba' in the literature of Islamic Fiqh based on the Holy Qur'an and Sunnah.
Out of these four transactions, the last two ones, mentioned above as (ii) and (iii) have not much relevance to the context of modern business, the barter business being a rare phenomenon in the modern trade. However, the Riba‑al‑Qur'an, and transaction of money mentioned above as (i) are more relevant to modern business.
In the light of the detailed discussion above, there is no difference between different types of loan, so far as the prohibition of Riba concerned. It also does not make any difference whether the additional amount stipulated over the principal loan or debt is small or large. It is, therefore, held that all the prevailing forms of interest either in the banking transactions or in private transactions do fall within the definition of `Riba'. Similarly, any interest stipulated in the Government borrowings, acquired from, domestic or foreign sources, is Riba and‑clearly prohibited by the Holy Qur'an.
The present financial system, based on interest, is against the Injunctions of Islam as laid down by the Holy Qur'an and Sunnah, and in order to bring it in conformity with Shari'ah, it has to be subjected to radical changes.
A variety of Islamic modes of financing has been developed by Islamic scholars, economists and bankers that may serve as a better alternative to interest. These modes are being practised by about 200 Islamic financial institutions in different parts of the world.
These alternatives being available, the transactions of interest cannot be allowed to continue for ever on the basis of necessity. Many experienced bankers, to name the few such as. Dr. Ahmad Muhammad Ali, President Islamic Development Bank, Jeddah, Mr. Adnan al‑Bahr, Chief Executive International Investor, Kuwait, Mr. Iqbal Ahmad Khan, Chief Executive Islamic unit of the Hong Kong Shanghai Banking Corporation (HSBC) based in London from outside Pakistan and Mr. Abdul Jabbar Khan, the former President of the National Bank of Pakistan, Mr. Shahid Hasan Siddiqui and Mr. Maqbool Ahmad Khan from Pakistan are the bankers who have a long experience of banking in different parts of the world, besides others. appeared before us. All of them were unanimous on the point that Islamic modes of financing are not only feasible, but are also more beneficial to bring about a balanced and stable economy, for which they have produced detailed proof based on facts and figures. Some outstanding economists like. Dr. Umar Chapra, the Economic Advisor, Saudi Monetary Agency, Dr. Arshad Zaman, the former Chief Economist of the Ministry of Finance, Government of Pakistan, Prof. Khurshid Ahmad, Dr. Nawab Hyder Naqwi, Dr. Waqar Masood Khan, have supported this view in their detailed discourses.
We have also gone through the detailed reports of the Council of Islamic Ideology submitted in 1980, the report of the Commission for Islamization of Economy constituted in 1991, and the final report of the same Commission, reconstituted in 1997 which was submitted in August, 1997. We have also perused the report of the Prime Minister's Committee on Self‑Reliance, submitted to the Government in April, 1991.
There is, thus, ample evidence to prove that quite a substantial ground work has been done to suggest the strategy for the transformation of the existing financial system to the Islamic one, and the present interest based' system cannot be retained for an indefinite period on the basis of necessity. However, the transformation may take some time which can be allowed on that basis.
For the reasons given above, all these appeals are hereby dismissed in the terms detailed hereafter in the order of the Court.
(Sd.)
Justice Muhammad Taqi Usmani, Member.
M.B.A./M‑404/S???????????????????????????????????????????????????????????????????????????????????????????????????????? Order accordingly:
PLD 2000 S C 760
[Shariat Appellate Jurisdiction]
Present: Justice Khalil‑ur‑Rehman Khan, Chairman, Justice Munir A. Sheikh, Justice Wajihuddin Ahmed, Justice Maulana Muhammad Taqi Usmani and
Justice Dr. Mahmood A.Ghazi, Members
Civil Shariat Appeal No.24 of 1992
HOUSE BUILDING FINANCE CORPORATION
through its Executive Director‑‑Appellant
versus
Rana MUHAMMAD SHARIF and 4 others‑‑‑Respondents
Civil Shariat Appeal No.25 of 1992
HOUSE BUILDING FINANCE CORPORATION
through its Executive Director‑‑‑Appellant
versus
Qari GHULAM RASUL and 3 others‑‑‑Respondents
Civil Shariat Appeal No.26 of 1992
HOUSE BUILDING FINANCE CORPORATION
through its Executive Director‑‑‑Appellant
versus
MUHAMMAD‑IQBAL CHAUDHRY and 3 others‑‑‑Respondents
Civil Shariat Appeal No.27 of 1992
HOUSE BUILDING FINANCE CORPORATION
through its Executive Director‑‑‑Appellant
versus
Dr.MAHMOODUR‑REHMAN FAISAL and 3 others‑‑‑Respondents
Civil Shariat Appeal No.28 of 1992
HOUSE BUILDING FINANCE CORPORATION
through its Executive Director‑‑‑Appellant
versus
Ch. MUHAMMAD SIDDIQ and 3 others‑‑‑Respondents
Civil Shariat Appeal No.29 of 1992
HOUSE BUILDING FINANCE CORPORATION
through its Executive Director‑‑‑Appellant
versus
Mst. MIRO JANA and 3 others‑‑‑Respondents
Civil Shariat A&al No.30 of 1992
HOUSE BUILDING FINANCE CORPORATION
through its Executive Director‑‑‑Appellant
versus
Haji MUHAMMAD ARIF and 3 others‑‑‑Respondents
Civil Shariat Appeal No.31 of 1992
HOUSE BUILDING FINANCE CORPORATION
through its Executive Director‑‑‑Appellant
versus
MOOR BAKHT and 3 others‑‑‑Respondents
Civil Shariat Appeal No.32 of 199?
HOUSE BUILDING FINANCE CORPORATION
through its Executive Director‑‑‑Appellant
versus
Mst. NOOR BAKHT and 3 others‑‑‑Respondents
Civil Shariat .Appeal No.33 of 1992
HOUSE BUILDING FINANCE CORPORATION
through its Executive Director‑‑‑Appellant
versus
Mst. NOOR BAKHT and 3 others
Civil Shariat Appeal No.34 of 1992
HOUSE BUILDING FINANCE CORPORATION
through its Executive Director‑‑‑Appellant
versus
ASHIQ HUSSAIN and 4 others‑‑‑Respondents
Civil Shariat Appeal No.35 of 1992
HOUSE BUILDING FINANCE CORPORATION
through its Executive Director‑‑‑Appellant
versus
MANZOOR HUSSAIN and 3 others‑‑‑Respondents
Civil Shariat Appeals Nos.24 of 1992 to 35 of 1992, decided on 23rd December, 1999.
(On appeal from the order dated 14‑11‑1991 of Federal Shariat Court passed in Shariat Petitions Nos.7‑L/91, 14‑L/91, 25‑L/90, 32‑I/90, 50‑L/91, , 5.9‑I/91, 83‑L/91, , 86‑L/91, 87‑L/91, 88‑L/91, 94‑L/91 and 100‑L/91).
(a) Constitution of Pakistan (1973)‑‑‑
‑‑‑‑Art. 227‑‑‑Provisions relating to the Holy Qur'an and Sunnah‑‑‑Islamic values shall have to be adopted and commitment to enforcement of Shariah have to be manifested if enforcement of Sharjah is to be made a living reality‑‑‑Concerned quarters will have to exhibit necessary vigilance to check and eliminate violations of law.
(b) Constitution of Pakistan (1973)‑‑‑
‑‑‑‑Art. 203‑F‑‑‑Shariat Appellate Bench of Supreme Court can only examine the relevant law in the light of the Holy Qur'an and Sunnah.
(c) House Building Finance Corporation Act (XVIII of 1952)‑‑‑
‑‑‑‑S. 4(2) [as amended by House Building Finance Corporation (Amendment) Act, 1979‑‑‑Constitution of Pakistan (1973), Art.203‑F‑‑?Repugnancy to Injunctions of Islam‑‑‑Word "interest" occurring in S.4(2) of the Act, though was substituted by word "return" by the House Building Finance Corporation (Amendment) Order, 1979, but same being based on fixed rate which may include interest, though with a different name, S.4(2) of the Act required to be suitably amended so as to clarify, that instead of a return based on a fixed rate relating to the capital, a proportionate share in the income of the Corporation may be given to the Federal Government‑‑?Principles.
(d) House Building Finance Corporation Act (XV1a of 1952)‑‑‑
‑‑‑‑S. 21(2)‑‑‑Constitution of Pakistan (1973), Art.203‑F‑‑‑Repugnancy to Injunctions of Islam‑‑‑Provisions of interest in S.21(2), House Building Finance Corporation Act, 1952 are un‑Islamic, and therefore, repugnant to Injunctions of Islam to that extent.
Muhammad Aslam Khaki v. Federation of Pakistan and others PLD 2000 SC 225 fol.
(e) House Building Finance Corporation Act (XVIB of 1952)‑‑‑
‑‑‑‑Ss.24(11)(12)(18) & (20)‑‑‑Investment Regulations, 1979, Reglns.14(1) (2) & 15(1)(2)‑‑‑Constitution of Pakistan (1973), Art.203‑F‑‑‑Repugnancy to Injunctions of Islam‑‑‑Process laid down for assessment of the rental income and fixation of the share of Corporation therein being arbitrary and against the spirit of partnership, insertion of a proviso was necessary to the effect that the partner would have a right to place the matter before a higher Authority nominated by the Corporation, so that the issue may be resolved on an equitable basis‑‑‑Further necessary requirements which must reflect in the law were summarized by Appellate Shariat Bench of the Supreme Court and it was observed that inasmuch as S.24(11) of the Act did not take care of such requirements, the same was repugnant to Injunctions of Islam.
(f) House Building Finance Corporation Act (XVIII of 1952)‑‑‑
‑‑‑‑S. 24(20)‑‑‑Constitution of Pakistan (1973), Art.203‑F ‑‑‑ Repugnancy to Injunctions of Islam‑‑‑Provision of S.24(20) of House Building Finance Corporation Act, 1952 is repugnant to Injunctions of Islam.
(g) Constitution of Pakistan (1973)‑‑‑
‑‑‑‑Arts. 203‑D & 203‑F‑‑Jurisdiction of Shariat Appellate Bench of Supreme Court‑‑‑Scope ‑‑‑While declaring a law repugnant to Injunctions of Islam, Shariat Appellate Bench has to specify a date from which the decision, shall have effect and, therefore, judgment of Shariat Appellate Bench does not have a retrospective effect.
(h) House Building Finance Corporation Act (XVIII of 1952)‑‑‑
‑‑‑‑S. 24(20)‑‑‑Constitution of Pakistan (1973), Art.203‑F‑‑‑Repugnancy to Injunctions of Islam‑‑‑Section 24(20), House Building Finance Corporation Act, 1952, is repugnant to Injunctions of Islam so far the same contains the provisions of interest.
Muhammad Aslam Khaki v. Federation of Pakistan and others PLD 2000 SC 225 fol.
(i) House Building Finance Corporation Act (XVIII of 1952)‑‑‑
‑‑‑‑Ss. 4(2), 21(2) & 24(11)(12)(20)‑‑‑Constitution of Pakistan (1973), Art.203‑F‑‑‑Repugnancy to Injunctions of Islam ‑‑‑Shariat Appellate Bench of the Supreme Court directed that .in view of observations made and guidelines provided in its judgment, necessary deletions and amendments be made in Ss.4(2), 22(2) & 24(11)(12), (20) by 30th June, 2000, so as to bring these provisions in conformity with Injunctions of Islam.
Muhammad Aslam Khaki v. Federation of Pakistan and others PLD 2000 SC 225 fol.
Ghulam Mujtaba, Advocate Supreme Court with Sadiqui Farooq, Chairman, HBFC and Zahid Hussain, Executive Director for HBFC.
Ch. Muhammad Farooq, Attorney‑General for Pakistan (on Notice, but did not argue); Maulvi Anwarul Haq, Deputy Attorney‑General (at initial stage); Syed Riazul Hassan Gilani, Advocate Supreme Court (appeared from 28‑6‑1999 to 2‑7‑1999 and thereafter did not appear despite notice to‑him); Ch. Zafar Iqbal, Advocate Supreme Court (appeared on behalf of the‑ Federal Government but not argued); Ch. Akhtar Ali, Advocate‑on‑Record, Mehr Khan Malik, Advocate‑on‑Record for the Federation of Pakistan.
Dates of hearing: 22‑2‑1999 to 26‑2‑1999, 1‑3‑1999 to 5‑3‑1999, 8‑3‑1999, 9‑3‑1999 (Islamabad); 17‑3‑1999 to 19‑3‑1999, 22‑3‑1999 to 26‑3‑1999 (Karachi); 3‑5‑1999 to 7‑5‑1999; 17‑5‑1999 to 21‑5‑1999; 24‑5‑1999 to 28‑5‑1999; 14‑6‑1999 to 18‑6‑1999; 28‑6‑1999, 29‑6‑1999, 1‑7‑1999, 2‑7‑1999, 5‑7‑1999 and 6‑7‑1999. .
ORDER
MAULANA MUHAMMAD TAQI USMANI, J.‑‑‑These appeals are directed against the judgment of the Federal Shariat Court dated 14‑11‑1991, reported as PLD 1992 FSC 501, whereby certain provisions of the House Building Finance Corporation Act, 1952 (hereinafter referred to as Act, 1952) as amended by the Amendment Ordinance of 1979 (hereinafter referred to as the Ordinance, 1979) were declared repugnant to the Injunctions of Islam.
The House Building Finance Corporation (hereinafter called `the Corporation') was established in 1952 for providing finances to the general public to acquire homes. In the beginning, house loans were advanced on the basis of interest. However, in 1978 the Council of Islamic Ideology recommended to abolish interest from some financial institutions, including the Corporation, as an initial step towards an interest‑free economy. The Council suggested that, instead of advancing loans on the basis of interest, the Corporation should enter into joint ownership of the house with their clients. The clients should pay rent to the Corporation for the utilization of the share of the Corporation in the property. At the same time the clients will keep on purchasing different units of the share of the Corporation, and thus, the principal amount invested by the Corporation will be gradually restored to the Corporation in the form of the price of the purchase, until the full house is ultimately owned by the client and the Corporation's share is fully purchased by him.
On the basis of this scheme, which is normally known in the terminology of Islamic banking as `diminishing partnership', Ordinance, 1979 was promulgated and the corporation started financing on that basis.
Mr. Siddiq‑al‑Farooq, the Managing Director of the Corporation appeared in this case in person and after hearing him at length, it transpired that the Corporation has abandoned the concept of `diminishing partnership after 31st July, 1989, and at present it is financing on the basis of a fixed return claimed from all the clients. When asked under which law the Corporation has changed the scheme, Mr. Siddiq al‑Farooq was unable to point out any amendment in the Ordinance, 1979, and frankly admitted that this change was brought by the Board of Directors of the Corporation in its meeting 2 of 1989 held at Karachi on 31st July,. 1989 without any amendment in the law.
It is really strange that the provisions of the relevant law were practically repealed by a resolution of the Board of Directors, and the whole purpose of the Ordinance, 1979 was defeated without any explanation or legal justification. It is painful to .note that flagrant violation of law was allowed to be. committed and perpetuated for all these years which manifests A attitude of the people at the helm of affairs to Islamic values and their commitment to enforce Shariah. Such an attitude will have to be curbed if enforcement of Shariah is to be made a living reality. The concerned quarters will have to exhibit necessary vigilance to check and eliminate such flagrant violation of laws. The Shariat Appellate Bench of the Supreme Court of Pakistan can only examine the relevant law in the light of the Holy Qur'an and Sunnah.
The impugned judgment of the Federal Shariat Court has, firstly, examined section 412) of the Act, 1952 which reads as follows:
"The Corporation shall pay to the Federal Government such return on the capital subscribed by the Federal Government under subsection (1) at such rate as the Federal Government may, by notification in the official Gazette, specify."
According to the impugned judgment, the word `interest' in the original Act, 1952 was substituted by the word "return" through the Ordinance, 1979. However, being based on a fixed rate, it may include interest, though with a different name. It is, therefore, directed by the Federal Shariat Court that this section be suitably amended to clarify that, instead of a return based on a fixed rate relating to the capital, a proportionate share in the income of the Corporation may be given to the Federal Government.
We agree with the finding of the Federal Shariat Court. Section 4(1) provides that the Federal Government may increase the authorized capital of the Corporation. Then section. 4(2) gives the basis on which the Federal Government subscribes capital to the Corporation, and that the Federal Government may specify the rate on which a return shall be paid to it, by the Corporation. If the rate of return in this subsection means a fixed rate of return relatable to the capital, it obviously amounts to charging interest, and if the rate of return contemplated in this subsection refers to the proportionate share in the income of the Corporation, it. should have been either a pro rata profit or 9 certain proportion of the actual profit, rather than a `rate of return' which in normal terms refers to a fixed rate of interest. The judgment of the Federal Shariat Court in respect of section 4(2) is hereby upheld and section 4(2) of the Act, 1952 is declared repugnant to the Injunctions of Islam. The same shall be amended in the light of the above discussion.
Section 21
Section 21 of the Act, 1952 provides for different ways of raising funds for the Corporation. Subsection (1) to section 21 envisages two different situations in clauses (a) and (b). Clause (a) provides for raising funds by taking loans or issuing certificates for investment on partnership basis, while clause (b) provides for taking loans or issuing, bonds and debentures for its investment for `investment other than on partnership basis'. It is in this background that subsection (2) of section 21 provides as follows:
"(2) The repayment of the principal after adjustment of profits and losses in case of working capital raised under clause (a) of sub?section (1) and repayment of principal and payment of interest due in case of funds raised under clause (b) of that subsection shall be guaranteed by the Federal Government."
The learned Federal Shariat Court has held the provision of interest in this clause as un‑Islamic. No exception can be taken to this finding of the Federal Shariat Court. Raising funds through interest bearing loans is against the Injunctions of Islam as detailed in our main judgment about Riba in the case of Muhammad Aslam Khaki v. Federation of Pakistan and others (Shariat Appeal No. 1/92 etc.). Even the guarantee of the principal provided by the Federal Government for the funds raised under partnership arrangement is not in accordance with Shariah in this particular case. The Corporation is almost wholly owned by the Federal Government. Therefore, when another person provides funds to the Corporation on the basis of partnership it means that the Federal Government is entering into a partnership with him. It is a well‑established rule of Shariah that a partner cannot guarantee the principal invested by his other partner, because it means that in the case of a loss, the whole loss will be borne by the guaranteeing partner and the other partner will remain immune from any loss. This is a clear violation of the. basic principle of Islamic partnership, where losses must be shared pro rata by all the partners.
Subsection (2) of section 21 is, therefore, repugnant to the Injunction of Islam in its entirety.
Mr. Ghulam Mujtaba, the learned counsel, for the Corporation has also conceded before us that the provisions of section 4(2) and section 21(2) are repugnant to the Injunctions of Islam to the extent mentioned above.
Section 24
The impugned judgment has then discussed the provisions of section 24(11),(I2),(18) along with the `Investment Regulations, 1979 Subsections (11), (12) and (18) of section 24 read as follows:
?"24: Conditions for investment.‑‑
(11)????? The net rental income shall be assessed by the Corporation for a period of three financial years commencing from the financial year in, which the proposal has been made and shall be revised every three years thereafter till the entire investment is repaid.
(12) The share of the Corporation in the net rental income shall be fixed at the ratio between the investment of the Corporation and the total estimated cost of the house at the time of the execution of deed of assignment and partnership and shall be revised after repayment of every thirty‑six instalments of the principal.
(18)????? No information given by any person applying for financial assistance and communicated to any of the Directors or employees of the Corporation shall be disclosed or used by such Directors or employees except for lawful purposes of the Corporation without the written consent of such person."
The 'Investment Regulations, 1979' read as under:
"14(1).‑‑‑The anticipated gross annual rental income of a house in which investment is made shall be the average of the rental income' of similar houses in the locality obtained through a sample survey conducted during the three months preceding the financial year in which the proposal for availing the investment is made:
Provided that the results of sample survey shall be reviewed by the Corporation before formal adoption in order to bring them into conformity with other supporting indices or to remove discrepancies, if any.
14(2).‑‑‑The anticipated gross annual rental income in localities where a sample survey has not been conducted shall be determined by the Corporation in such manner as it may deem proper.
15(1).‑‑‑The share of the Corporation in the net rental income shall initially be determined as the ratio between the investment of the Corporation and the total estimated cost of the house at the time of execution of the deed of assignment and partnership.
15(2).‑‑‑The share of the corporation in the net rental income shall be revised after repayment of every thirty‑six instalments of principal amount of the investment and shall remain fixed on the balance of the investment so reduced until such further revision, till the entire investment be repaid."
The objection of the Federal Shariat Court is that the process laid down for assessment of the rental income and fixation of the share of Corporation therein is arbitrary, and against the spirit of partnership. The need of the partner is, thus, exploited, while he is equally entitled to have a say in this matter. A proviso is, therefore, held to be necessary to the effect that the partner will have a right to place the matter before a higher authority nominated. by the^ Corporation, so that the issue may be resolved on an equitable basis.
The proposal of the Federal Shariat Court seems apparently justified. However, it may also be kept in mind that it should not open the door for frivolous disputes and prolonged proceedings. The process provided by the `Investment Regulations, 1979' is a reasonable process, and the partner should enter into the agreement with open eyes. If the Corporation, or any one of its officers, has violated the procedure laid down for the fixation of rent, normal legal remedies will remain available for anyone who can prove the violation. To establish a separate forum for such disputes may bring a flood of complaints and may in turn defeat the system altogether.
However, there are certain points that were not attended to by the learned Federal Shariat Court while examining section 24 and its subsidiary Regulations. These are summarized below:
"(a)?????? Subsections (6) (b),, (9) and (12) of. section 24 as well as
Regulations 15(2) frequently refer to the repayment of the investment by installments'. This terminology is not suitable for the concept ofdiminishing partnership' on which Ordinance 1979 was conceptually based. The original concept, as mentioned at the outset of this discussion; was that the partner will gradually keep on purchasing. different units of the share of the
Corporation. These instalments are meant to purchase these units: For example, the share of the Corporation is 80% of the property. This share of 80% will be divided into 160 units as a simple example. The partner will purchase one unit out of these 80 on monthly basis. No doubt, the net result is that the
Corporation will recover its principal through this process. But it should be remembered that this is not the repayment of a loan'. It is a purchase. It will be more appropriate, therefore, that the instalments are namedthe purchase installments'.
(b)??????? Subsection (11) of section 24 provides that the net rental income shall be assessed by the Corporation for a period of three years. This period seems to be reasonable so far as the fixation of rent with regard to the locality is concerned. However, there is another aspect that has been overlooked in this respect. As mentioned above, the payment of instalments by the partner is, in fact, purchase of a certain unit of the share of the Corporation. Therefore, as soon as the partner pays an instalment, the share of the Corporation is reduced and share of the partner is increased to that extent. This aspect should be reflected in the rent payable by him. In other words, the rent payable by him should decrease to that extent. In the above example, if the share of the Corporation constituted 160 units and the partner has paid one instalment, the share of the Corporation came down to 159 units. The rent payable by the partner, therefore, ought to be reduced by 1/160. This adjustment in the rent must take place after every instalment. It does not require a new survey of the rental value as was feared by the representatives of H.B.F.C.; it is simply a matter of calculation which can easily be done. It is not only equitable and gives gradual relief to the partner, but it is a necessary? requirement of the concept of `diminishing partnership' according to Shariah and is being practised by many Islamic financial institutions, even in non‑Muslim countries.
Mr. Zahid Husain, the Executive Director of the Corporation admitted that this type of adjustment in the rent is not difficult in any way. This necessary requirement, therefore, must be reflected in the law, and in so far as subsection (11) of section 24 does not take care of it, it is repugnant to the Injunctions of Islam.
Section 24(20)‑
Subsection (20) of section 24 reads as follows:
"Loans made before the first day of July, 1979 shall, unless the Federal Government otherwise directs, continue to be governed by the terms and conditions on which they had been advanced."
The learned Federal Shariat Court has observed about it as follows:
"The learned standing counsel for the Federation stated (on the instructions of the 'Federation) at the bar that the Federal Government does not support this subsection. In view of this admitted position, this subsection is declared repugnant to the Injunctions of Islam.
Mr. Ghulam Mujtaba, Advocate, the learned counsel for the Corporation submitted that the Corporation, in this case before the Federal Shariat Court, was represented by its own counsel, and the standing counsel for the Federation had no occasion to concede in the absence of the counsel of the Corporation and without the specific instructions on the subject from the Corporation itself. However, he admitted that this section relates to the transactions which are mostly past and closed. Mr. Zahid Hussain, the Executive Director of the Corporation has, nonetheless,' stated that there are still some thousand cases for which compound interest has already been foregone.
According to the Constitution, while declaring a law repugnant to the Injunctions of Islam, we are bound to specify a date from which the decision shall have effect, and thus the judgment of the Shariat Appellate G Bench does not have a retrospective effect. So till the date this decision takes effect, the intervening period may be availed by the Corporation for settling these past issues. So far the provision of interest in the above section is H concerned, it is 'certainly repugnant to the Injunctions of Islam. It is held accordingly.
For the reasons given in our main judgment of even date in the case of Muhammad Aslam Khaki v. Federation of Pakistan and others PLD 2000 SC 225 and the reasons given above we hereby uphold the judgment of the Federal Shariat Court with the observations and directions contained hereinabove and direct that necessary deletions and amendments be made in sections 4(2), 21(2) and 24 (11), (12) and (20) by 30th June, 2000, so as to bring them in conformity with the Injunctions of Islam as laid down in the Holy Qur'an and Sunnah of the Holy Prophet (p.b.u.h.).
M.B.A./H‑1/S ???????????????????????????????????????????????????????????????????????????????????????????????? Order accordingly.
PLD 2000 S C 770
[Shariat Appellate Jurisdiction]
Present: Justice Khalil‑ur‑Rehman Khan, Chairman, Justice Munir A. Sheikh, Justice Wajihuddin Ahmed, Justice Maulana Muhammad Taqi Usmani and
Justice Dr. Mahmood A. Ghazi, Members
FEDERATION OF PAKISTAN‑‑‑Appellant/Applicant
Versus
Dr. MAHMOOD‑UR‑REHMAN
FAISAL and others‑‑‑Respondents
Shariat Miscellaneous Application. No.708 of 1998 and Shariat Appeal No.73 of 1992, heard on 24th February, 1999.
Constitution of Pakistan (1973)‑‑‑
‑‑‑‑Art.203‑F‑‑‑Supreme Court Rules, 1980, O.XXXV, Rr.l, 5 & p.XV, R.1‑‑‑Appeal filed by Federation of Pakistan against the judgment of Federal Shariat Court declaring statutory provisions relating to interest (Sood) repugnant to Injunctions of Islam, was sought to be withdrawn through an application for the reason set out in a petition which was simultaneously filed in the Federal Shariat Court and was prayed before the Supreme Court that the contents of the petition before Federal Shariat Court be treated as part of the application for withdrawal of appeal‑‑‑Validity‑‑‑Absolute right to withdraw appeal could not be inferred with respect to a Shariat appeal also in view. of the nature of the controversy involved in a Shariat appeal as well as in view of the provisions of the Constitution and R.5 of O.XXXV, Supreme Court Rules, 1980.
Per Justice Khalil‑ur‑Rehman Khan, Chairman‑‑‑
Appeal filed by the Federation against the judgment of Federal Shariat Court declaring statutory provisions relating to interest (Sood), repugnant to Injunctions of Islam contained in Holy Qur'an and Sunnah of the Holy Prophet (peace be upon him), was sought to be withdrawn by moving application, stating that the Government had decided to withdraw the appeal for the reasons set out in the petition which was simultaneously being filed in the Federal Shariat Court with the 'request that the contents thereof may be treated as part of the application for withdrawal of appeal.
Rule 1 of Order XV of Supreme Court Rules, 1980, shows that it does not talk of grant of permission to withdraw an appeal. The object of the rule is to deal with the question of costs, evidently on the assumption that the appellant has a right to withdraw his appeal any time. Without express provision the right to withdraw a civil appeal implied from Rule 1 of Order XV, Supreme Court Rules, 1980, cannot extend to the withdrawal of criminal appeal and it is for this reason that Supreme Court has held in many cases that a person who brings an appeal from an order of acquittal of the respondent, with the leave of the Court, does not have the right to abandon the appeal at his will, as such a course is opposed to public policy and is unwarranted both by the rules and practice of the Court. Such an absolute right to withdraw cannot be inferred with respect to a Shariat appeal also in' view of the nature of the controversy involved in a Shariat appeal as well as in view of the provisions of the Constitution of the Islamic Republic of Pakistan and Rule 5 of Order XXXV of the Supreme Court Rules, 1980.
Provisions contained in clauses (4) to (8) of Article 243‑E of the Constitution apply to the proceedings before the Supreme Court as well, by virtue of clause (2) of Article 203‑F of the Constitution. Moreover, it was bounden duty of the Government, as was claimed in the application for withdrawal of appeal itself, to eliminate Riba with a view to comply with its commitments. The avowed purpose of withdrawing the appeal was to enable the Federal Shariat Court to provide guidance on the issues raised in the petition but the same could not be achieved as the appeal sought to be withdrawn was not the only appeal pending before the Shariat Appellate Bench of Supreme Court. There were 75 other appeals filed by the Banks, Financial Institutions and others, and due to pendency of these appeals, the Shariat Appellate Bench shall remain seized with the matter and the matter being sub judice before Supreme Court,. could not be simultaneously taken up by the Federal Shariat Court.
Moreover, the inference that the appellant in a civil litigation had a right to withdraw his appeal at any time was based on the principle that by withdrawing the appeal the appellant naturally accepts the judgment appealed against and to such acceptance the respondents in the appeal could have no objection. But that was not the situation here as on query it was stated that withdrawal of the Shariat Appeal from the Shariat Appellate Bench did not amount to acceptance of the judgment passed by the Federal Shariat Court as the Government/Federation of Pakistan had certain reservations against the impugned judgment and was seeking guidelines for implementing the judgment and for introducing changes in the Banking system etc.
As to the pleas that the appeal, had not been disposed of for a period of almost five years by the date of filing of the application for withdrawal of appeal i.e.1‑7‑1997 and that the Government was of the view that by allowing its appeal to, remain pending, the process of Islamisation of laws relating to Riba would be delayed for an indefinite period, Federation was asked as to whether the Government in all this period submitted any application for fixing of the appeal or even the application seeking withdrawal of appeal since the date of its filing. The fact of the matter was that instead of seeking hearing of the appeal itself or the application seeking withdrawal of appeal, the Government had been causing delay in hearing of the appeal as at one time the Government denotified the appointment of two Ulema who had been appointed to attend sittings of the Bench as ad hoc members of the Shariat Appellate Bench. Then, one of the Ulema members of the Bench remained sick for quite some time and it was only after his demise that appointment of another member was made thereby making possible the constitution of Shariat Appellate Bench. It was on account of these reasons that the Shariat Appeals could not be disposed of early and now when the appeals have been fixed, the Federation was seeking permission to withdraw the appeal so as to approach the Federal Shariat Court for guidelines and to obtain a further period of two years for introducing the Islamic Banking system in accordance with the guidelines which will be provided by the Federal Shariat Court.
No steps, however, were taken by the Government itself for introducing the necessary changes in the Financial and the Banking system to bring. the same in conformity with the Injunctions of Holy Qur'an and Sunnah of the Holy Prophet (p.b.u.h.). It was primary obligation of the Federal Government coming into power from time to time to transform the present system according to the Injunctions of Holy Qur'an and Sunnah of the Holy Prophet (p.b.u.h.) and so it, was obligatory for the Federation which, in any case, was a party to the connected appeals as respondent to provide all assistance necessary to resolve the intricate issues involved in the Shariat Appeals. Even as a respondent, a party, specially the Federation of Pakistan/Government, was required under clause (6) of Article 203‑E of the Constitution of the Islamic Republic of Pakistan to assist the Court truly and effectively so that the Injunctions of Islam were explained, expounded and interpreted. Shariat Appellate Bench of the Supreme Court had already directed the Federal Government to nominate its experts to render assistance to the Court. The Government on account of its public announcements stands committed to eliminate Ri6a and introduce economic and banking system according to the Injunctions of Holy Qur'an and Sunnah of the Holy Prophet (p.b.u.h.).
B.Z. Kaikaus v. Federal Government of Pakistan and others PLD 1982 SC 409 ref.
Per Justice Wajihuddin Ahmed, Member‑‑‑
The application to the Federal Shariat Court is filed under Article 203‑D rather than Article 203‑E(9) of the Constitution, which has specifically conferred power of review on the Federal Shariat Court relative to any decision given or order made by it. The normal principle, on the other hand, is that a party cannot simultaneously seek review from the same forum, which decided a case and pursue an appeal before a higher forum. It has to choose its remedy. Obviously, because the present appeal had been preferred and the same remained pending for no less than five years, the Federal Government had irretrievably chosen its remedy as such and the application as above to the Federal Shariat Court was hardly warranted.
The most significant aspect of the matter is that the process of Islamization and concomitant elimination of Riba from the polity of Pakistan has now been going on for almost two decades. A good deal of work has been done over the years in such directions and besides individual, efforts institutional exercises have been continuously undertaken. What is more, the impugned judgment of the Federal Shariat Court which the Federal Government accepts in one breath and does not implement in the other, itself lays down the methodology of implementation. While an appeal from a Federal Shariat Court judgment, declaring any law or provision of law as repugnant to the Injunctions of Islam, precludes such judgment to take effect before the disposal of the appeal (proviso to Article 203‑D(2) of the Constitution), there is no bar on the Federal Government or the Federal Legislature or on their provincial counterparts to act upon the Injunctions of Islam on their own. None of this seems to have been done at any level either during the period of five years before the making of the applications to Shariat Appellate Bench of Supreme Court and to the Federal Shariat Court nor during the period of (almost) two years, which had been fought from the Federal Shariat Court. No less significant is the fact that none of the functionaries has put up either in Supreme Court or in the Federal Shariat Court its own modalities for ensuring the elimination of Riba from the Islamic Republic of Pakistan. This should now be done by the Government and the other (State‑run) appellants before Supreme Court while their appeals are pending so that the methodology which has found favour with the Federal Shariat Court be more closely examined with reference to all other points of view.
This has not been found to be a fit case either on the factual or the legal plane to allow withdrawal of the appeal. As manifested in Article 203‑E(6) of the Constitution the proceedings, before the Federal Shariat Court or in appeal before Supreme Court are not partisan proceedings and even parties are required to state, expound and interpret the Injunctions of Islam impartially and without any ill‑motive. Beside, under Order XXXV, Rule 5 of the Supreme Court Rules, 1980, an appeal filed against the final decision of the Federal Shariat Court under Article 203‑D of the Constitution cannot be dismissed even on account of absence of the appellant nor can it even abate in the event of death of any of, the parties, provisions which are a clear departure from routine appeals in the Supreme Court as well as in other fora. Thus, allowing withdrawal of this appeal has not been nor could conceivably be a routine or mechanical exercise.
Maulvi Anwar‑ur‑Haq, Deputy Attorney‑General and Ch. Akhtar Ali, Advocate‑on‑Record for Appellant/Applicant.
Respondent No. l in person.
Ismail Qureshi, Advocate Supreme Court for Respondents (in some of the connected appeal).
Date of hearing: 24th February, 1999.
ORDER
JUSTICE KHALIL‑UR‑REHMAN KHAN (CHAIRMAN).‑‑‑The appeal filed by the Federation against the judgment of Federal Shariat Court declaring statutory provisions relating to interest (sood), repugnant to Injunctions of Islam contained in Holy Qur'an and Sunnah of the Holy Prophet (peace be upon him), is sought to be withdrawn by moving this application, stating that the Government has decided to withdraw the appeal for the reasons set out in a petition which is simultaneously being filed in the Federal Shariat Court and the contents whereof may be treated as part of this application.
(i) that despite the passage of almost five years, the said appeals have not been disposed of and the matter is lingering on indefinitely;
(ii) that the Government has come to the conclusion that allowing its appeal to remain pending in the Supreme Court would merely delay the Islamization of the laws relating to Riba for an indefinite period, which would not be in consonance with its declared aims and objectives;
(iii) that the Government respectfully seeks that parameters and guidelines be laid down by this Honourable Court, within which, and in compliance with the requirements whereof, the Government can then move the necessary legislation for the compliance of its constitutional duty and obligation to enforce a truly Islamic legal system; and
(iv) that very serious issues of the utmost importance having a close and intimate bearing on Pakistan's obligations both to foreign lenders as well as in relation to the functioning of the Banking system in the country, including lending to pay foreign debt, inflation, indexation etc. are involved and the Government. seeks guidance of the Court (Le: Federal Shariat Court) in the shape of laying down the guidelines on the basis of which. the Government can comply with its solemn commitments within the framework of Islamic Injunctions.
It is also stated that Government seeks specific parameters and guidelines so as to enable banking and other related laws to be recast in such a manner that they conform strictly to the stipulations of Islam.
With these. averments, besides seeking guidelines following which the Government, remaining within the framework of Islamic Injunctions can meet its commitments, a further period of two years has been sought f6r the introduction of Islamic system.
Maulvi Anwarul Haque, Deputy Attorney General in support of the application submitted that Order X.XXV of the Supreme Court Rules, 1980 deals with the appeals and petitions under Article 203‑F of the Constitution and Rule 1 thereof provides that provisions contained in other Orders and Rules relating to civil and criminal appeals/petitions etc. mutatus mutandis apply to appeals etc. filed under Article 203‑F, subject, of course, to other provisions of this Order. So 'Order XV which deals with withdrawal etc. of appeals equally applies to the Shariat Appeals and an appellant has a right to withdraw the appeal, if appellant so chooses not to pursue it. According to learned Deputy Attorney. General, this right of an appellant in ‑a civil cause to withdraw cannot be denied. In this respect reference was made to B.Z.Kaikaus v. Federal Government of Pakistan and others (PLD 1982 SC 409). In this. Shariat Appeal, it was held that, "the appellant has a right to abandon his appeal and not to pursue it; that the Court cannot prevent it. This in law also amounts to withdrawal thereof. It was further observed that it is not necessary to go into the motive as to why the appellant has done so. "
Mr. Ismail Qureshi; Advocate, who represents some of the respondents in the connected appeals, opposed this application and states that the purpose of withdrawing the appeal and taking the matter before the Federal Shariat Court is to cause further delay in the implementation of the Qur'anic Injunctions relating to elimination of Riba. According to him Federation of Pakistan having been cited as a respondent in the connected appeals has to present its point of view on the issues involved and in these circumstances the Federal Shariat Court cannot be approached for seeking guidelines which, in any case, can be sought from the Shariat Appellate Bench. Learned counsel submitted that moving of the application in the garb of seeking clarification or guidelines, in fact, amounts to committing contempt of the Supreme Court and contempt proceedings should be initiated against the relevant authorities suo moto.
We have given serious consideration to the request seeking permission to withdraw the Shariat Appeal. Rule (1) of Order XV of the Supreme Court Rules, 1980 which applies by virtue of the provisions of Rule (1) of Order XXXV of the Supreme Court Rules, reads as under:‑‑
"When an appellant desires to withdraw his appeal he shall make an application to that effect to the Court. The costs of the appeal and the security, entered into by the appellant, if any, shall then be dealt with in such manner as the Court may, deem fit."
"An appeal filed against the final decision of the Federal Shariat Court under Article 203‑D of the Constitution shall not be dismissed on account of absence of the appellant nor shall it abate in the event of the death of any of the parties to it."
Clause (6) of Article 203‑E of the Constitution of the Islamic Republic of Pakistan, 1973 reads as under:‑
"A legal practitioner or jurisconsult representing a party before the Court shall not plead for the party but shall state, expound and interpret the Injunctions of Islam relevant to the proceedings so far as may be known to him and submit to the Court a written statement of his interpretation of such Injunctions of Islam." , 8. It may be noted that provisions contained in clauses (4) to (8) of Article 203‑E' of the Constitution apply to the proceedings before the Supreme Court as well, by virtue of clause (2) of Article 203‑F of the Constitution. Moreover, it is bounden duty of the Government, as is claimed in the application itself, to eliminate Riba with a view to comply with its commitments. The avowed purpose of withdrawing the appeal is to enable the Federal Shariat Court to provide guidance on the issues raised in C the petition but the same cannot be achieved as the appeal sought to be withdrawn is not the only appeal pending before the Shariat Appellate Bench. There are 75 other appeals filed by the Banks, Financial Institutions and others; and due to pendency of these appeals, the Shariat Appellate Bench shall remain seized with the matter and the matter being sub judice before this Court cannot be simultaneously taken up by the Federal Shariat I Court. Learned Deputy Attorney‑General was unable to show as to how and under what provision of law the Federal Shariat Court can entertain the petition presented to it. Moreover, the inference that the appellant in a civil litigation has a right to withdraw his appeal at any time is based on the principle that by withdrawing the appeal the appellant naturally accepts the judgment appealed against and to such acceptance the respondents in the appeal can have no objection. But that is not the situation here. as on query learned Deputy Attorney General stated that withdrawal of the Shariat D Appeal from the Shariat Appellate Bench does not amount to acceptance of the judgment passed by the learned Federal Shariat Court as the Government/Federation of Pakistan has certain reservations against the impugned judgment and is seeking guidelines for implementing the judgment and for introducing changes in the Banking system etc.
As to the pleas that the appeal has not been disposed of for a period of almost five years by the date of filing of the application for withdrawal of appeal i.e.1‑7‑1997 and that the Government is of the view that by allowing its appeal to remain pending, the process of Islamisation of laws relating to Riba will be delayed for an indefinite period, learned Deputy Attorney General was asked as to whether the Government in all this period submitted any application for fixing of the appeal or even the application seeking withdrawal of appeal since the date of its filing. The fact of the matter is that instead of seeking hearing of the appeal itself or the application seeking withdrawal of appeal, the Government has been causing delay in hearing of the appeal as at one time the then Government denotified the appointment of two Ulema who had been appointed to attend sittings of the Bench as ad hoc members of the Shariat Appellate Bench. Then, one of the Ulema members of the Bench remained sick for quite some time and it was only after his demise that appointment of another learned member was made thereby making possible the constitution of Shariat Appellate Bench. It was on account of these reasons that the Shariat Appeals could not be disposed of early and now when the appeals have been fixed, the Federation is seeking permission to withdraw the appeal so as to approach the Federal Shariat Court for guidelines and to obtain a further period of two years for introducing the Islamic Banking system in accordance with the guidelines which will be provided by the Federal Shariat Court.
Learned Deputy Attorney General was unable to inform us as to the i steps, if any taken by the Government itself for introducing the necessary changes in the financial and the Banking system to bring the same in conformity with the Injunctions of Holy Qur'an and Sunnah of the Holy Prophet (Peace be upon him). It is primary obligation of the Federal Government coming into power from time to time to transform the present system according to the Injunctions of Holy Qur'an and Sunnah of the Holy Prophet (p.b.u.h.) and so it is obligatory for the Federation which, in any case, is a party to the connected appeals as respondent to provide all assistance necessary to resolve the intricate issues involved in the Shariat Appeals. Even as a respondent, a party, specially the Federation of Pakistan/Government, is required under clause (6) of Article 203‑E of the, Constitution of the Islamic Republic of Pakistan to assist the Court truly and effectively so that the Injunctions of Islam are explained, expounded and interpreted. We have already directed the Federal Government to nominate its experts to render assistance to this Court. The Government on account of its public announcements stands committed to eliminate Riba and introduce economic and banking system according to the Injunctions of Holy Qur'an and Sunnah of the Holy Prophet (p.b.u.h').
As regards' the last plea to initiate contempt proceedings, suffice it to say that real issues involved in the matter should receive our attention rather than the side issues, which tray or may not be arising. The Government, in any case, is before us and is bound to take a. definite stand in the matter. Therefore, we are not persuaded to entertain this plea.
For the reasons given above, the application (SMA N0.708 of 1998) seeking withdrawal of Shariat Appeal is rejected.
The above are the reasons for our short order dated 24th February, 1999.
(Sd.)
Justice Khalil‑ur‑Rehman Khan, Chairman.
(Sd. )
Justice Munir A. Sheikh, Member.
Agreeing, I have respectfully added a short note.
(Sd.)
Justice Wajihuddin Ahmed, Member.
(Sd.)
Justice Maulana Muhammad Taqi Usmani, Member.
(Sd.)
Justice Dr. Mahmood A. Ghazi, Member.
JUSTICE WAJIHUDDIN AHMED (MEMBER).‑‑‑Having had the advantage of going through the reasons, ascribed by the learned Chairman for the short order of dismissal of S.M.A. No.708 of 1998 and fully agreeing with the same, I consider it necessary to add a few words in the way of further reasons for the short order above mentioned.
'The referred S.M.A. was filed on 30‑6‑1997 and does not seem to have been diligently pursued with the result that the same could be registered only in 1998. It is a very short application and proceeds, thus:‑‑‑
"(1) That the Government has decided to withdraw the present case, for the reasons set out in a petition which is simultaneously being filed in the Federal Shariat Court and the contents whereof may kindly be treated as part of the present application. Copy annexed.
(2) It is, therefore, prayed that this Honourable Court may be pleased to allow the Government to withdraw the present appeal."
Since the reasons for seeking withdrawal are to be found in the application stated to have simultaneously been filed before the Federal Shariat Court (FSC), copy whereof is annexed, note thereof has not been taken in the main order. It is, however, significant that the application to the FSC is filed under Article 203‑D rather than Article 203‑E(9) of the Constitution, which has specifically conferred power of review on the Federal Shariat Court relative to any decision given or order made by it. The normal principle, on the other hand, is that a party cannot simultaneously seek review from the same forum, which decided\a case and pursue an appeal before a higher forum. It has to choose its remedy. Obviously, because the present appeal had been preferred and the same remained pending for no less than five years, the Federal Government had irretrievably chosen its remedy as such and the application as above, to the Federal Shariat Court was hardly warranted.
Even so, while affirming the primacy of Islamic Law and submitting to the Islamic Injunctions pertaining to Riba, the Federal Government in its referred application to the FSC proceeded to state that the judgment of the FSC affecting Riba was rendered only by three Judges of. the Court and that the application lately filed by the Federal Government by heard either by the entire Court or by at least five Judges of the FSC.
The application in question correspondingly proceeded to paint a virtual dooms‑day scenario concerning the effect of the Federal Shariat Court judgment in words which need to be reproduced‑as below:‑‑‑
" 11. That it is necessary to point out that very serious issues of the utmost importance having a close and intimate bearing on Pakistan's obligations both to foreign lenders as well as in relation to the functioning of the Banking system in the country are raised in the present case. By way of illustration, some of the salient issues are set out in the succeeding paras. infra for purposes of elucidation. .
Firstly, that Pakistan will be declared as a defaulter in international markets.
Secondly, Pakistan will not be able to obtain any further foreign loan or credit.
Thirdly, not merely foreign Governments and international lending agencies will refuse to extend credit facilities to the Government but even foreign commercial banks will refuse to advance any money to the Government, Fourthly, letters of credit which are opened by Pakistani Banks to enable the import of goods will no longer be acceptable abroad. In consequence, the import of goods into the country will be drastically, and perhaps critically, reduced. In particular, this would have a direct impact and bearing on the import of wheat, edible oil, petroleum and oil, as well as other commodities.
Fifthly, quite apart from the adverse impact on the Government, commercial and industrial companies operating in Pakistan would find it almost impossible to import capital goods and machinery for further industralization of the country. Similarly, the import of raw materials to allow the continued functioning of plants and factories in the country would be adversely affected.
Having recast the background as above, it would be pertinent to identify here the declared object of seeking withdrawal of the appeal from this Court and filing of a simultaneous application by the Federal Government before the FSC. Such was as under:‑‑‑
"(18) That the Government seeks authoritative answers` to these fundamental issues which will enable it to comply with its international and domestic obligations while remaining firmly within the frame work of Islamic Injunctions. In other words, the Government seeks a workable solution which will prevent the country from becoming an international defaulter and will also allow the functioning of the Banking system in any shape or form which may be sanctioned by the Injunctions of Islam. It is for these reasons that the Government seeks specific parameters anti guidelines so as to enable banking and other related laws to be recast in such a manner that they conform strictly to the stipulations of Islam."
To attain the stated objective the following relief was said to have been claimed by the Federal Government from the FSC:‑‑‑
"It is, therefore, prayed that this Honourable Court may be pleased‑‑
(a) to constitute a larger Bench for the purpose enunciated in the above, (b) to allow a time period of two years for the introduction of a truly Islamic system in accordance with the guidelines laid down by this Honourable Court.
(c) Pass such interim or other orders as may be deemed appropriate in the interest of justice."
The most significant aspect of this matter is that the process of Islamization and concomitant elimination of Ribu from the polity of Pakistan has now been going on for almost two decades. A good deal of work has been done over the years in such directions and besides individual efforts institutional exercises have been continuously undertaken. What is more, the impugned judgment of the F.S.C., which the Federal Government accepts in one breath and does not implement in the other, itself lays down the methodology of implementation. It needs to be pointed out here that while an appeal from a Federal Shariat Court judgment, declaring any law or provision of law as repugnant to the Injunctions of Islam, precludes such judgment to take effect before the disposal of the appeal (proviso to Article 203‑D(2) of the Constitution), there is no bar on the Federal Government or the Federal legislature or on their provincial counterparts to act upon the Injunctions of Islam on their own. None of this seems to have been done at any level either during the period of five years before the making of the applications to this Court and to the F.S.C.., nor during the period of (almost) two years; which had been sought from the F.S.C. No less significant is `the fact that none of the functionaries has put up either in this Court or in the F.S.C. its own modalities for ensuring the elimination of Riba from the Islamic Republic of Pakistan. This, I may add here, should now be done by the Government and the other (State run) appellants before this Court while their appeals are pending so that the methodology which has found favour with the F.S.C., can be more closely examined with reference to all other points of view.
Having said as much, this has not been found to be a fit case either on the, factual or the legal plane to allow withdrawal of the instant appeal. As observed by the learned Chairman‑ and manifested in Article 203‑E(6) of the Constitution the proceedings before the F.S.C. or in appeal before this Court are not partisan proceedings and even parties are required to state, expound and interpret the Injunctions of Islam impartially and without any ill motive. Besides, as already pointed out in the main order, under Order XXXV, Rule 5 of the Supreme Court Rules, 1980, an appeal filed against the final decision of the F.S.C., under Article 203‑D of the Constitution cannot be dismissed even on account of absence of the appellant nor can it even abate in the event of death of any of the parties, provisions which are a clear departure from routine appeals in the Supreme Court as well as in other fora. Thus, allowing withdrawal of this appeal has not been nor could conceivably be a routine or mechanical exercise.
Seen in the above perspective, no case for withdrawal of the Shariat appeal was made out and S.M.A. No.708 of 1998 was dismissed for .reasons appearing in the main order together with those added hereinabove.
M.B.A./F‑1/S Application dismissed.
P L D 2000 Supreme Court 783
Present: Irshad Hasan Khan, C.J and Qazi Muhammad Faroaq, J
ISHRAT YAR KHAN‑‑‑Petitioner
versus
ABDUL REHMAN ‑‑‑ Respondent
Civil Petition No. 1332 of 1999, decided on 15th March, 2000.
(On appeal from the judgment dated 4‑5‑1999 gassed by the Lahore High Court, Rawalpindi Bench, Rawalpindi, in F. A. 0. No. 112 of 1998).
(a) Cantonments Rent Restriction Act (XI of 1963)‑‑
‑‑‑‑S. 17‑‑‑Bona . . fide personal need of landlord‑‑‑Landlord, a retired headmaster had stated on oath that he had constructed his residential house alongwith a garage and rented out the garage by converting same into a shop in order to pay back the loan obtained from 'House Building Finance Corporation and loan having been repaid, he wanted the premises back for his personal use for safe parking of his car‑-Such statement of landlord had not been shattered or effectively rebutted in defence, rather was supported by the admissions contained in the statements of the witnesses examined by the tenant that the shop in dispute was a part of the landlord's residential house and he owned a car‑‑‑Nothing was available on record to suggest that shop in question was not an, integral part of the residential house. of landlord‑‑Landlord admittedly owned a car and the shop in question was originally a garage, therefore, he was .well within his right to use the premises as a garage and as such it could not be said that personal need set up by landlord was not bona fide.
(b) Cantonments Rent Restriction Act (XI of 1963)‑‑
‑‑‑S. 14‑‑‑Temporary'use of a part of a residential house for commercial purpose, would not change its essential. character as a part of residential building.
Syed Amjad Ali Shah's case ‑PLD 1985 SC 242; Raja Qurban Khan's case 1980 SCMR 590; Muhammad Ramzan's case 1985 SCMR 2082(2); Ghulam Rasool Shah's case 1986 SCMR 1605; Nasiruddin Khan v. Abdul Majid 1987 CLC 2029; Shabbir's case 1985 CLC 2841 and Suba v. , Siraj Din PLD 1977 Lah. 1263 ref.
(c) Cantonments Rent Restriction Act (XI of 1963)‑‑
‑‑‑‑S. 14‑‑‑Landlord renting out a part of his house for non‑residential use for earning additional income to clear his debts, need not seek permission of Rent Controller under S.14, Cantonments Rent Restriction Act, 1963 for such conversion.
Gul Zarin Kiani, Advocate Supreme Court and Ch.Akhtar Ali, Advocate‑on‑Record for Petitioner.
Manzoor Ahmed Rana, Advocate Supreme Court and M.A. Zaidi, Advocate‑on‑Record for Respondent.
Date of hearing: 15th March, 2000.
ORDER
IRSHAD HASAN KHAN, C.J.‑‑Petitioner filed an eviction application under section 17 of the Cantonments Rent Restriction. Act (hereinafter referred to as the Act) for ejectment of the respondent from the disputed property described as a garage of House No.B‑71, Lala Rukh, Wah Cantt.
(1) Whether the suit property is required for personal/bona fide use of the petitioner for residential purpose as a garage?
(2) Whether the residential building has been converted into commercial use without permission of the Rent Controller under section 14 of the Rent Restriction Act, 1963, if so, to what effect?
In view of the pleadings of the parties, the issues struck thereon and the evidence on record the learned Rent Controller came to the conclusion that the shop in dispute was in fact a garage and accordingly directed eviction of the respondent on the ground of personal requirement, vide order dated 11‑11‑1998.
On appeal preferred by the' respondent the High Court reversed the findings of the learned Rent Controller after reappraisal of the evidence on record, vide judgment dated 4‑5‑1999. Feeling aggrieved the landlord has filed the present petition for leave to appeal. '
Mr. Gul‑ Zarin Kiani, learned Advocate Supreme Court for the petitioner, raised the following contentions:‑‑
(1) The shop in dispute is in fact a garage and an integral part of the residential house of the petitioner who admittedly owns a car and his statement on oath has not been shattered and rebutted in defence. Therefore, his bona fide requirement of the garage for personal use stands established on record.
(2) The garage was constructed as a part of residential house of the petitioner therefore its temporary use for a non-residential purpose cannot change its original status. The building plans showing the premises in dispute as a garage were approved by the Wah Cantonment Board on 23-11-1975 and 19-6-1998 but due to an oversight were not put in evidence before the learned Rent Controller and have been annexed with the petition which may be read in evidence.
(3) The learned Rent Controller had granted ex post facto permission for conversion in terms of section 14 of the Act by allowing the eviction petition and observing that, I find force in concluding that by reverting the possession of the garage/shop the earlier irregularity shall be got regularized.
Mr. Manzoor Ahmed Rana, learned Advocate Supreme Court appearing for the respondent, also relied on the case of Shabbir v. Dr. Miss Shahbaz Somjee (supra) to contend that character of a building is not changed unless permission in that behalf is granted by the Rent Controller who can grant the requisite permission, depending upon the facts and circumstances of each case, on an application filed for the purpose. In the instant case neither a formal application was moved by the petitioner nor permission was granted by the Rent Controller. He further submitted that there was nothing on the record to support the assertion that the shop in question was originally constructed as a garage of the petitioner's house. He maintained that the petitioner cannot seek commercial property for residential purposes and in any case the property in dispute is not required by him for personal use in good faith.
After giving our anxious consideration to the rival contentions we have arrived at the conclusion that. the contentions raised by the learned counsel for the petitioner have a definite edge over the submissions made by the learned counsel for the respondent.
The petitioner is a retired Headmaster. He has stated on oath that the shop in dispute was originally the garage of his residential house and was converted into a shop and rented out to the respondent for meeting the loan liability of the House Building Finance Corporation and having cleared the loan he now proposes to restore it to its original status to facilitate safe parking of his `car. His statement has indeed not been shattered or effectively rebutted in defence. Rather it is supported by the admissions contained in the statements of the witnesses examined by the respondent that the shop in dispute is a part of the petitioner's residential house and the petitioner owns a car, It would have been more appropriate if the documents annexed with this A petition had been made a part of evidence on record but the omission is not fatal and there is no need to advert to the said documents as petitioner's case stands proved in the light of evidence on record and there is nothing on record to suggest that the shop in dispute is not an integral part of his residential house: The petitioner admittedly owns a car and the shop in dispute was originally a garage, therefore, he is well within his right to use it as a garage and as such it cannot be said that the personal need set up by him is not bona fide.
10. The contention 'that temporary use of a part of a residential house for commercial purpose would not change its essential character as a part of residential building is amply supported by case‑law. It was held in the case of Syed Amjad Ali Shah (PLD 1985 SC 242) that the West Pakistan Urban Rent Restriction Ordinance, 1959 never intended that once a landlord commits a mistake of renting out a part of his house for non‑residential use for earning some additional income at his own inconvenience, he can never seek its. restoration to him by evicting the tenant even if he on account of changed circumstances genuinely requires it for his use as part of residence. In other words, it would be deemed to have become a non-residential building for all times to come and in order to retrieve it he would have to tell a lie that he needs it for non‑residential use. Indeed this was not the intention of the relevant law when enacted. In the case of Raja Qurban Khan (1980 SCMR 590) it was held that notwithstanding the change in the use of a residential unit to a non‑residential unit, with or without the consent of the landlord, it would not amount to the change of character of the building for purpose of eviction under section 13. The rule laid down in that case was followed in the case of Muhammad Ramzan (1985 SCMR 2082(2)). In the former case a house originally constructed for residential purposes was used as a hotel and in the latter case Baithak of a house rented out by landlord‑ to tenant was used for commercial purposes as a shop. Same view was taken in the case of Ghulam Rasool Shah (1986 Another noteworthy case is reported as Nasiruddin Khan v. Ahdul Majid 1987 CLC 2029 wherein it was observed that since entire residential building is not being used for non‑residential purpose the garage, being teed for non‑residential purpose, cannot be held to be a non‑residential building. Reference may also be made to the case of Shabbir (1985 CLC 2841) wherein it was held that "in order to attract the definition of a non‑residential building it must be shown that the building was used solely for the purpose of business or trade. Admittedly the respondent's bungalow is a residential building, not having been solely put to use for the purpose of business or trade, In Suba v. Siraj Din PLD 1977 Lah. 1263 it was held by the Lahore High Court that a 8 building which is of a composite character and is being used partly for other purpose will still remain a residential building. The character of the building was not altered even if a part of the building was put to non‑residential use and even if `any question of conversion was involved, the tenant cannot have a grievance on that account since section 11 of the Ordinance authorises a Rent Controller to allow such conversion by an order in writing".
As regards the conversion related contention based on section 14 of the Act it would be enough to say that failure of the petitioner to move a formal application for the purpose cannot be blown out of proportion in the face of acceptance of his application for eviction of the respondent by the learned Rent Controller with the observations highlighted above. As a matter of fact the contention coot be raised at all as the shop in dispute being an integral part of the house of the petitioner and essentially a garage is to‑ be treated as a residential building.
For the foregoing reasons this petition is converted into appeal and allowed in the terms that the impugned judgment is set aside and the order of the learned Rent Controller is restored. The respondent shall hand over vacant possession of the premises in dispute to the petitioner within a period of three months from today. Parties to bear their own costs.
M.B.A./I‑4/S Appeal allowed
P L D 2000 Supreme Court 787
present: Muhammad Bashir Jehangiri, Munir A Sheikh and Nazim Hussain Siddiqui, JJ
Haji ABDULLAH JAN‑‑‑Appellant
versus
ANWAR KHAN‑‑‑Respondent
Civil Appeal No. 689 of 1997, decided on, 27th March, 2000
(On appeal from the judgment dated 23‑6‑1996 of High Court of Balochistan passed in F.A.O. No. 107 of 1995).
(a) West Pakistan Urban Rent Restriction Ordinance (VI of 1959)‑‑‑
‑‑‑‑S. 13‑‑‑Constitution of Pakistan (1973), Art.185(3)‑‑‑Bona fide personal need of landlord‑‑Leave to appeal was granted by Supreme Court to consider the question that all the co‑owners, being landlords, whether one of them could file eviction application for his own personal need or not.
(b) West Pakistan Urban Rent Restriction Ordinance (VI of 1959)‑‑‑
‑‑‑‑Ss. 14 & 13‑‑‑Second application for ejectment of tenant on same issue‑‑Maintainability‑‑‑Earlier application for ejectment of tenant on the ground of bona fide personal need of landlord was filed by a co‑owner which was decided finally‑‑‑Second application instituted after a period of 5 years on same issues with the assertion that property in question had been partitioned was maintainable‑‑‑Provision of S.14, West Pakistan Urban Rent Restriction Ordnance, 1959 would not be attracted if the circumstances were changed.
(c) West Pakistan Urban Rent Restriction Ordinance (VI of 1959)‑‑‑
‑‑‑‑Ss. 13 & 2(c)‑‑‑Bona fide personal need of landlord ‑‑‑Co‑owner being a landlord within the scope of definition of "landlord" appearing in S.2(c) of the Ordinance ejectment application against tenant by a co‑owner without joining other co‑owners was competent.
(d) West Pakistan Urban Rent Restriction Ordinance (VI of 1959)‑‑‑
‑‑‑‑Ss. 14 & 13‑‑‑Application for ejectment of tenant‑‑‑Earlier application for ejectment‑of tenant on the ground of bona fide personal need of landlord was filed by one of the co‑owners which was decided finally‑‑‑Second application was instituted after a period of 5 years on almost same issues (bona fide need and construction of the property) with the assertion that property in question had been partitioned‑‑‑Validity‑‑‑Nothing concrete had been brought on record to show that the property in question was actually partitioned among the co‑owners nor even portions to be owned by the co‑owners were shown‑‑‑Evidence produced was insufficient to justify eviction of the tenant on the ground of alleged bona fide need and reconstruction of the property‑‑Pleas of ejectment of tenant on such grounds were justifiably rejected in ,circumstances‑‑‑Supreme Court, however, observed that after private settlement/partition of property in question the applicant or any other co owner or all of them could, if so advised, file fresh eviction application against the tenant clearly stating his/their requirements for bona fide personal need and in such a situation fresh application would be decided by Rent Controller on its merits.
Muhammad Munir Peracha, Advocate' Supreme Court and S.A.M. Quadri, Advocate‑on‑Record for Appellant.
Basharatullah, Senior Advocate Supreme Court and Mehta W.N. Kohli, Advocate‑on‑Record for Respondent.
Date of hearing: 27th March, 2000.
JUDGMENT
NAZIM HUSSAIN SIDDIQUI, J.‑‑Vide order dated 22‑5‑1997 leave to appeal was granted to the appellant against the judgment dated 23‑6‑1996 of the High Court of Balochistan, Quetta, to consider if all A the co‑owners being landlords one of them could file eviction application for his own personal need or not.
"(1) That. the tenant has agreed to enhance the rent of the premises in question from 1‑9‑1990 at the rate of 7500 out of which Rs.2,500 is already being deposited in the Court. The tenant shall pay balance rent amounting to Rs.1,35,000 from 1‑9‑1990 to 30‑10‑1992, at the rate of Rs.5,000 within a period of three months from this date.
(2) That the future rent shall be paid at the rate of Rs.7,500.
(3) The appellant agreed to withdraw the appeal filed before this Court. Since the parties have compromised, therefore, they shall bear the cost. "
It appears that the appellant again filed Eviction Application No.9 of 1995 against the respondent under section 13 of the Balochistan Urban Rent Restriction Ordinance, 1959 (hereinafter called 'the Ordinance') stating that the property in question was partitioned among its owners in the month of December, 1994 and thereafter, each of the co‑owners claimed his respective share and possession in said property for their bona fide personal use and requirement. It was also alleged that the building was to be reconstructed for satisfying the needs of all the co‑owners.
The respondent contested the claim of the appellant on merits as well as‑on legal grounds. It was alleged that in view of section 1.4 of the Ordinance the eviction application was not maintainable. On merits the respondent claimed that the appellant does not require said premises for his personal bona fide use.
Learned Rent Controller by order dated 29‑11‑1995 allowed the eviction application and directed the respondent to hand over vacant possession of the premises to the appellant within 4 months from the date of said order.
Above order was impugned being F. A. O. No. 107 of 1995 before the High Court and learned Judge in Chamber allowed the appeal, set aside the eviction order and dismissed the eviction application. This order has been challenged in this appeal.
Learned High Court held. that the eviction application was barred under section 14 of the Ordinance and that the appellant had no locus standi to move eviction application on behalf of the co‑owners. It was also observed that the appellant failed to show that private settlement between owners of said property was arrived at.
Section 14 of the Ordinance reads as under:‑‑
"14. The Controller shall summarily reject any application under subsection (2) or under subsection (3) of section 13 which raises substantially the same issues as have been finally decided in a former proceeding under this Ordinance. "
Section 13 of the Ordinance enumerates the grounds on which eviction of a tenant can be ordered. It includes the ground for own use by the landlord or for the use of his children in good faith. According to section 14 (ibid) the Controller shall summarily reject any application for eviction which raises substantially the same issues as have been finally decided in a former proceeding under the Ordinance. In fact, it lays down the principle of res judicata. It is noted that said section would not be attracted if the circumstances are changed. Whether the circumstances are changed or not it would depend upon the facts of each case. As pointed out above, earlier application was filed in July, 1990 and till 1995 a period of 5 years had passed when second application was instituted with the allegation that the property was partitioned. Under the circumstances second eviction application of the appellant was maintainable.'
Adverting to the leave granting order, it is noted that learned High Court with reference to section 13(3)(ii)(1) of the Ordinance observed that plain reading of above provisions indicated that except landlord or his children no one else including co‑owners, brother of landlord were competent to invoke the jurisdiction of Controller for ejectment of tenant, unless they themselves had not attained status of landlord. For above, the reliance was placed on a decision of this Court reported as Abdul Salam Akhtar v. Dr. Najam Parvez 1976 SCMR 52. This case was under West Pakistan Urban Rent Restriction Ordinance, 1959 and the scope of words of "own occupation" was considered. It was held that above words were to be interpreted in restricted manner so as to be confirmed to the personal requirement of individual landlord alone. It was held that the personal need of the landlord was there in addition to the need of his brother.
We are of the view that above case is not attracted to the circumstances of this case, as here the precise question is if one of the co-owners could file eviction application or not. Above point was considered by this Court in the case reported as Khalique Ahmed v. Abdul Gani and another PLD 1973 SC 214. It was laid down in the said case, which was instituted under West Pakistan Urban Rent Restriction Ordinance, that suit for ejectment by one 'co‑owner without joining other co‑owners was competent. Following above dictum we hold that eviction application can be filed by a co‑owner without joining other co‑owners as co‑owner is a landlord within the scope of definition of "landlord" appearing in clause (c) of section 2 of the Ordinance.
Coming to the merits of the case, it is noted that nothing concrete' has been brought on record to show that the property was actually partitioned among the co‑owners nor even portions to be owned by the co‑owners, are shown. The evidence was insufficient to justify eviction of the respondent on the ground of alleged bona fide personal use. Although a plea was taken that building was to be reconstructed having two shops and a restaurant in the portion in possession of the respondent but substantial evidence to that effect was missing.
Under the circumstances, we do not find any merit in this appeal and the same is dismissed. However, after private settlement/partition of said property the appellant or any other co‑owner or all of them, may, if so advised, file fresh eviction application against the respondent clearly stating his/their requirements for bona fide personal use. It goes without saying that, if so is done, the fresh eviction application by Rent Controller would be decided on its merits.
M.B.A./A‑28/S Appeal dismissed.
L D 2000 Supreme Court 792
Present: Sh. Ijaz Nisar, Sh. Riaz Ahmed and Rana Bhagwan Das, JJ
DAULAT ALI through Legal Heirs and 2 others‑‑‑Petitioners
versus
AHMAD through Legal Heirs and 2 others‑‑‑Respondents
Civil Petition for Leave to Appeal No. 1631: L of 1997, decided on 5th April, 2000. .
(On appeal from the judgment dated 2‑12‑1997 of Lahore High Court, Lahore, passed in Civil Revision No. 1761 of 1984). '
(a) Civil Procedure Code (V of 1908)‑‑‑
‑‑‑0. VI, R.8 & O.VIII, R.3‑‑‑Qanun‑e‑Shahadat (10 of 1984), Art.31‑‑Admission‑‑‑Question of fact having been expressly and unequivocally admitted in the pleadings, would not require any proof.
(b) Colonization of Government Lands (Punjab) Act (V of 1912)‑‑
‑‑‑‑S. 19‑‑‑Sepcific Relief Act (I of 1877), S.12‑‑‑Specific performance of agreement to sell land‑‑‑Document entered into between the parties was merely an agreement to sell, specific performance whereof was postponed till such time the allottee had acquired full ownership rights‑‑‑Such a reservation was made in the document itself which reflected the awareness of the constraints, the recognition of its legal effect and an effort on the part of the parties to the contract to keep themselves well within confines of law and to act strictly in consonance with the requirements of the statute‑‑‑Such an agreement to sell was not violative of either the express provisions of S.19, Colonization of Government Lands (Punjab) Act, 1912 or of the public policy behind such statutory provision.
Hakim Ali v. Atta Muhammad 1981 SCMR 993; Muhammad Iqbal v. Muhammad Hussain. PLD 1986 SC 70; Rehmat .Bibi v. Jhando Bibi 1992 SCMR 1510; Sher Muhammad Khan v. Ilam Din 1994 SCMR 470 and Abdul Ghani v. Fatima Bibi 1994 SCMR 1786 ref.
(c) Colonization of Government Lands (Punjab) Act (V of 1912)‑‑
‑‑‑‑S. 19‑‑‑Ejected Tenants Scheme‑‑‑Transfer of proprietary rights‑‑‑Tenant of Government land to whom proprietary rights had been conferred under Ejected Tenants Scheme could sell his land and no permission of the Collector was required.
(d) Colonization of Government Lands (Punjab) Act (V of 1912)‑‑
‑‑‑‑S. 19‑‑‑Transfer of proprietary rights‑‑‑Oral agreement of sale by vendor (transferee) in favour of vendee was not hit by S.19, Colonization of Government Lands (Punjab) Act, 1912.
Hakim Ali v. Atta Muhammad 1981 SCMR 993; Muhammad Iqbal v. Muhammad Hussain PLD 1986 SC 70; Rehmat Bibi v. Jhando Bibi 1992 SCMR 1510; Sher Muhammad Khan v. Ilam Din 1994 SCMR 470 and Abdul Ghani v. Fatima Bibi 1994 SCMR 1786 ref.
Muhammad Sayeed Akhtar, Advocate Supreme Court and S. ‑Inayat Hussain Shah, Advocate‑on‑Record (absent) for Petitioners.
Tanvir Ahmad, Advocate‑on‑Record for Respondent No. 1.
Date of hearing: 5th April, 2000.
ORDER
RANA BHAGWAN DAS, J.‑‑Leave to appeal is sought against the judgment of the learned Judge in Chambers of the learned High Court in Civil Revision No. 1761 of 1984 affirming the decree passed in a suit for specific performance by the trial Court and upheld by the First Appellate Court.
Respondents filed a ‑suit for specific performance of an agreement to sell dated 27‑6‑1966 relating to agricultural land measuring 63 Kanals against the petitioners' predecessor‑in‑interest Rehmat Ali (since . dead and represented by the petitioners). It was the case of the respondents that the suit land was agreed to be sold for a sum of R.s.15,000 of which Rs.12,000 were 'paid by way of earnest money while the balance amount was due and payable at the time of execution of the sale‑deed. It may be observed that no date for execution of the conveyance deed was fixed. It was, however, stipulated that the vendor shall perform his obligations under the agreement after payment of the balance of remaining instalments to the Government. Respondents averted that they were never notified about the payment of instalments due but quite surprisingly they learnt that the vendor was contemplating to sell the suit land to someone else whereupon they served a notice dated 12‑41976 on him but finding no response were obliged to file the suit for specific performance.
Petitioners resisted the suit on the grounds that the suit was undervalued; that it, was barred by time; that the respondents had no locus standi and cause of action to bring the suit; that no agreement of sale was executed by deceased respondent‑Rehmat Ali and that the suit was premature and not maintainable in its present form.
On assessment of evidence learned trial Court decided all the issues of fact as well as law against the petitioners and decreed the suit on payment of balance amount of Rs.3,000. Petitioners unsuccessfully challenged the decree in first appeal as well as in civil revision leading to the instant petition for leave to appeal.
Confronted with the legal ,position that findings of fact were concluded by three Courts of law including the learned High Court, learned counsel contended with vehemence that since deceased Rehmat Ali had not been conferred with proprietary rights on the date of. execution of the agreement to sell, the transaction was void and incapable of execution. Learned counsel persuaded us to agree to the proposition that the contract of sale being violative of the provisions of section 19 of the Colonization of Government Lands (Punjab) Act; 1912 (hereinafter referred to as Act, 1912) could not be specifically enforced by the Civil Court. The argument is wholly untenable and fallacious on the face of it. From the record we find that in the written statement filed by deceased Rehmat Ali himself on 12‑6‑1976 it. was stated in clear and candid terms that he had acquired proprietary rights in respect of the suit land. The matter does not rest here. Even after his demise the petitioners in the amended written statement (which was unnecessary and uncalled for) also conceded in unequivocal terms that their predecessor‑in‑interest, deceased Rehmat Ali, had become owner of the suit land. In fact this plea was urged before the Courts below and was rightly repelled. Indeed the reasons recorded for rejecting this plea as also the submission that the respondents should have proved through concrete evidence the factum of acquisition of proprietary rights‑appear to be sound and convincing. There is no manner of doubt that this question of fact having been expressly and unequivocally admitted in the pleadings did not require any proof as it is well‑settled that the facts admitted need not be proved. It is A for this reason that no specific issue on this point was struck by the trial Court and rightly so. Petitioners, however, were permitted to raise this plea in the context of Issues Nos. 3, 6 and 6‑C relating to the cause of action, entitlement of the plaintiffs to seek specific performance and maintainability or otherwise of the suit. Be that as it may, learned High Court in its well reasoned and well‑considered judgment has taken care of this submission in elaborate manner which does not call for any exception.
Execution of a lawful agreement for valuable consideration being fully established and ‑conferment of proprietary rights on deceased Rehmat Ali being admitted in pleadings it can hardly be said that even after 8 conferment of proprietary rights his status remained that of a tenant. Any tenant of Government land to whom proprietary rights had been conferred under the Ejected Tenants Scheme could sell his land and no permission of the Collector was required as misunderstood. Indeed the document entered into between the parties was merely an agreement to sell, specific performance whereof was postponed till such time the allottee had acquired full ownership rights. Such a reservation was made in the document itself which reflected the awareness of the constraints, the recognition of its legal e effect and an effort on the part of the parties to the contract to keep themselves well within, confines of law and to act strictly in consonance with the requirements of the statute. We are of the considered view that such an agreement to sell cannot be held to be violative of either the express provisions of section 19 of Act, 1912 or of the public policy behind such statutory provision. There have been a number of cases in which even oral agreement of sale by vendor in favour of vendee was held to be not hit by the provisions of section 19 of Act, 1912. This Court has already settled the law on the subject inn the cases reported as Hakim Ali v. Atta Muhammad 1981 SCMR 993, Muhammad Iqbal v. Muhammad Hussain PLD 1986 SC 70, Rehmat Bibi v. Jhando Bibi 1992 SCMR 1510, Sher Muhammad Khan v. Ilam Din 1994 SCMR 470 and Abdul Ghani v. Fatima Bibi 1994 SCMR 1786.
For the aforesaid facts and reasons the petition is devoid of any merit and is accordingly dismissed. Leave to appeal is, thus, refused.
M.B.A./D‑2/S Petition dismissed
P L D 2000 Supreme Court 795
Present: Saiduzzaman Siddiqui, Sh. Ijaz Nisar and Mamoon Kazi, JJ
Mohtarama BENAZIR BHUTTO, M.N.A, and another‑‑‑Petitioners
versus
THE STATE‑‑‑Respondent
Criminal Petitions Nbs.65 and 66 of 1999, decided on 18th March, 1999
(On appeal from the judgment and order of the Ehtesab Bench of the Lahore High Court, Rawalpindi Bench, Rawalpindi, dated 15‑3‑1999 passed in E.R. No.30 of 1998).
(a) Ehtesab Act (IX of 1997)‑‑‑
‑‑‑‑Ss. 3, 10 & 12‑‑‑Criminal Procedure Code (V of 1898), S.340(2)‑‑ Allegation of corruption and corrupt practices‑‑Reference ‑‑‑Procedure‑‑Right of person against whom proceedings were instituted to be defended and his competency to be a witness ‑‑‑Nowithstanding the facts that accused failed to produce any witness when Reference under Ehtesab Act, 1997 against her was taken up for hearing, Supreme Court allowed the accused to appear as her own witness before the Ehtesab Bench under S.340(2), Cr.P.C.‑‑Ehtesab Bench was further directed by Supreme Court to allow the accused a fair opportunity to examine witnesses in their defence within the bounds of law.
(b) Ehtesab Act (IX of 1997)‑‑
‑‑‑‑Ss. 3, 10 & 12‑‑‑Criminal Procedure Code (V of 1898), Ss.265‑A to 265‑N & 342‑‑‑Allegation of corruption and corrupt practices‑‑Reference‑‑‑Trial‑‑‑Admissibility of documentary or oral evidence produced by prosecution‑‑‑Determination‑‑‑Stage‑‑‑Procedure‑‑‑Question of admissibility of a document tendered in the evidence, if objected to by the accused, can either be decided by the Court at the time of receiving the document in evidence or Court may postpone its consideration at some later stage‑‑‑Accused is called upon to enter on his defence not with reference to admissibility or otherwise of any evidence produced by the prosecution but with reference to circumstances and points appearing in the evidence of prosecution against the accused to which his attention is drawn while examined under S.342, Cr.P.C.‑‑‑Question of admissibility of any piece of evidence produced by the prosecution in the case, therefore, has a bearing to the conviction or acquittal of the accused in the case on the basis of such evidence‑‑‑If the accused has objected to the admissibility of any documentary or oral evidence against him in the case, he is free to press objection before the Court at the stage of arguments which will be disposed of in accordance with the law‑‑‑Accused is, however, not entitled under any law to ask for the postponement of their defence in the case until determination of the question of admissibility of either documentary or oral evidence produced by the prosecution‑‑‑Contention that unless the question of admissibility of the documents produced in the evidence by the prosecution was determined, accused could not be asked to enter upon his defence, was repelled.
In terms of clause (1) of section 12 of the Ehtesab Act, the procedure prescribed under the Code of Criminal Procedure, 1898 for trial of cases is made applicable to proceedings under the Act except where the provisions of the Code are found in conflict with the provisions of the Act. In the latter case, the provisions in the Act apply, subject to clause (1) of section 12, Ehtesab Act, 1997, Chapter XXII‑A of the Code (sections 265‑A to 265‑N) which contains provisions relating to the trial of cases before High Court and Court of Session, has been specifically made applicable in its totality to the trials under the Ehtesab Act. Section 265‑C, Cr.P.C. specifies the statements and documents which are to be supplied to the accused in the" case before the framing of the charge. Section 265‑D of the Code provides that the Court may frame the charge against the accused after perusal of police report or the complaint, as the case may be, and other documents and statements filed by the prosecution, if the Court is of the opinion that there is sufficient ground for proceedings against the accused in the case. After framing of the charge, the Court calls upon the accused under section 265‑E, Cr.P.C. whether he pleads guilty to the charge or not. In case he pleads guilty to the charge, he may be convicted by the Court then and there. However, if he denies the charge, he may be asked whether he has any defence. Section 265‑F of the Code deals with the manner of production of evidence by the prosecution and the accused at the trial of the case.
Section 265‑F of the Code which applies to the proceedings of trials under the Act. clearly provides that in the event of denial of charge by the accused, the Court shah record evidence offered by the prosecution in support of the charge in the case against the accused. The prosecutor may apply to the Court for summoning the witnesses and the Court shall summon such witnesses after ascertaining from .the prosecutor the names of the witnesses who are acquainted with the facts of the case. The Court may, however, refuse to summon a prosecution witness if it is of the opinion, which is to be recorded in writing, that the witness being summoned for the purposes of vexation or to cause delay of the trial or to defeat the ends of justice. On conclusion of the evidence of prosecution the Court shall examine the accused and ask him if he intends to adduce any evidence. If the accused files any written statement, the Court shall keep the same on record and if the accused elects to lead evidence, the Court shall call upon him to‑enter his defence and produce his evidence. After accused has entered his defence ac aforesaid, he may apply to the Court as provided in section 265‑F(7). Cr.P.C. for the issuance of process for compelling the attendance of any witness for examination in the case which the Court shall allow unless for reasons to be recorded in writing, the Court considers that the purpose of making the application is vexatious or to delay the proceedings or to defeat the ends of the justice. In a case where accused does not adduce evidence in his defence, the Court, on close of prosecution case and examination of accused (if any), may ask the prosecutor to sum up his case and then call upon the accuses] to reply. However, if the accused leads evidence in his defence, the Court shall call upon the accused to sum up his case on the close of defence evidence and then call upon the prosecutor to reply. The Court, under section 265-H, Cr.P.C., shall either acquit or convict the accused, if after framing of the charge, he is found not guilty or guilty as the case may be.
The accused is to be asked by the Court to enter on his defence and to produce his evidence; after the prosecution has concluded its evidence, the accused has been examined under section 342, Cr.P'.C. and on being asked by the Court the accused expresses his desire to lead evidence in his defence in the case. In the present case although, the statement of accused persons recorded under section 342, Cr.P.C. by the Court had not been produced before Supreme Court bur it was not denied that the statement of the accused persons under section 342, Cr.P.C. were recorded by the Court after the prosecution closed his evidence in the case and the accused expressed their desire to lead the evidence in defence in their statements under section 342. Cr.P.C. There is provision in the Cr.P:C. which requires that where the prosecution has produced documents in its evidence then unless the question of admissibility of the documents so produced. is determined by the Court, the accused cannot be called upon to enter on his defence. The question of admissibility of a document tendered in the evidence, if objected to by an accused, can either be decided by the Court at the time of receiving the document in evidence or it may postpone its consideration at some later stage. The contention of the accused that unless the question of admissibility of the documents produced in the evidence by the prosecution was determined, they could not be asked to enter upon their defence, had no merit. The accused are charged in a criminal case on basis of the evidence produced by the prosecution. Similarly, the object of examination of an accused under section 342, Cr.P.C. is to draw his/her attention to the circumstances and pieces of evidence in the case against him/her which are relied by the prosecution or which are likely to influence the mind of the Court. Therefore, the accused is called upon to enter on his defence not with reference to admissibility or otherwise of any evidence produced by the prosecution but with reference to circumstances and points appearing in the evidence (if prosecution against the accused to which his attention is drawn while examined under section 342, Cr.P.C. The question of admissibility of any piece of evidence produced by the prosecution in the case, therefore, bas a bearing to the conviction or acquittal of the accused in the case on the basis of such evidence. If the accused persons have objected to the admissibility of any documentary or oral evidence against them in the case, they are free to press the objection before the Court at the stage of arguments which will be disposed of in accordance with the law. They are, however, not entitled under any law to ask for the postponement of their defence in the case until determination of the question of admissibility of either documentary or oral evidence in the case produced by the prosecution.
(c) Ehtesab Act (IX of 1997)‑‑‑
‑‑‑‑S. 12‑‑‑Criminal Procedure Code (V of 1898), Ss.265‑A to 265‑N‑‑Allegation of corruption and corrupt practices ‑‑‑Reference‑‑‑Procedure‑‑Accused while applying to summon a‑ witness in defence was not required to disclose the substance of his evidence.
According to section 12(2), Ehtesab Act, 1997, the provisions contained in Chapter. XXII‑A of Cr.P.C. relating to procedure for trial of cases before High Court and Court of Session, equally apply to trial under the Act: There is no provision in Chapter XXII‑A of Cr.P.C. or any other provision in the Act or the Code which required that an accused, while applying to summon a witness in defence; must also disclose the substance of his evidence.
(d) Ehtesab Act (IX of 1997)‑‑‑
‑‑‑‑S. 12(3)‑‑‑Criminal Procedure Code (V of 1898), Preamble ‑‑‑Reference‑‑Procedure‑‑‑Dispensation with the procedure prescribed under Criminal Procedure Code, 1898 by the Court‑‑‑Condition‑‑‑Court, though under S.12(3), Ehtesab Act, 1997 has been vested with the power to dispense with the procedure prescribed under Criminal Procedure Code. 1898 and to follow any other procedure it may deem fit in the circumstances of the case, but to do that Court has to record its reasons.
No doubt, under section 12 (3) of the Act, the Court has been vested with the power to dispense with the procedure prescribed under the Code and to follow any other procedure it may deem fit in the circumstances of the case, but, to do that the Court has to record its reasons.
(e) Ehtesab Act (IX of 1997)‑‑‑
‑‑‑‑S. 12‑‑‑Criminal Procedure Code (V of 1898), 5.265‑F(7)‑‑‑Reference‑‑Procedure‑‑‑Evidence for prosecution‑‑‑Court has full. power under S.265‑F(7), Cr.P.C. to decline to summon any witness in defence if ‑the Court is of the view that the application has been made for the purpose of vexation or to delay the proceedings or to defeat the ends of justice.
(f) Ehtesab Act (IX of 1997)‑‑‑
‑‑‑‑S. 12‑‑‑Criminal Procedure Code (V: of 1898), Ss.340(2) & 342‑‑Allegation of corruption and corrupt practices‑‑Reference‑‑‑Procedure‑‑Record of the case did not show that the accused was afforded an opportunity to examine herself under S.340(2), Cr.P.C. as her own witness and she declined to avail the said opportunity‑‑‑Supreme Court, in circumstances. allowed the accused opportunity to examine herself under S.340(2), Cr.P.C. as her own witness and directed accused to appear before the Ehtesab Bench where her statement under S.340(2), Cr.P.C. was to be recorded as her own witness.
Section 340(2), Cr.P.C. casts a duty on the Court to inform the accused that he/she has a right under the law to make a statement on oath and it is his option with no risk attaching it, to either make that statement or not to make that statement. The fact that accused was examined by the Court under section 342, Cr.P.C. in the case, would not make any difference as the object of examination of an accused under section 342, Cr.P.C. is quite different from his evidence under section 340(2), Cr.P.C. In the former case the accused is informed by the Court of the points or material brought on
record by the prosecution which is against him or which may influence the mind of the Court while in the latter case, the evidence is offered to disprove the case set up by the prosecution against him.
In the present case the record did not show that accused was afforded an opportunity to examine herself under section 340(2), Cr.P.C. as her own witness in the case and she declined to avail the same, Supreme Court in circumstances allowed her the opportunity to examine herself under section 340(2), Cr.P.C. as her own witness in the case and directed the accused to appear before the Ehtesab Bench so that her statement under section 340(2), Cr.P.C. may be recorded in the case as her own witness.
Mst. Ameer Khatun v. Faiz Ahmad PLD 1991 SC 787 ref.
(g) Ehtesab Act (IX of 1997)‑‑‑
‑‑‑‑S. 12‑‑‑Summoning of witness‑‑‑Procedure‑‑‑Contention of accused before Supreme Court was that some of the witnesses proposed to be examined by the accused were the residents abroad and therefore Ehtesab Bench may be directed to ask the concerned Embassy of Pakistan in the countries, where said witnesses were residents, to issue them necessary visa to come to Pakistan to record their evidence‑‑‑Validity‑‑‑Question of issuance of visa was a matter of Policy of the Government over which the Court could not exercise any control ‑‑‑Ehtesab Bench if granted the request of accused to examine the witnesses who were resident abroad, Court may grant copy of such order to accused to enable her to approach the Government for grant of visa to the witnesses to come to Pakistan to record their evidence‑‑‑Entire responsibility of producing such witnesses would, however, lie on the accused.
(h) Ehtesab Act (IX of 1997)‑‑‑
‑‑‑‑S. 12‑‑‑Criminal Procedure Code (V of 1898), 5.265‑K‑‑‑Allegation of corruption and corrupt practices‑‑‑Reference‑‑‑Procedure‑‑‑Arguments on the main case as well as application filed under S.265‑K, Cr.P.C. by accused may be heard by the Ehtesab Bench simultaneously at conclusion of the defence evidence‑‑‑Consideration of objections raised to the admissibility of documents by the accused at the time of their production in evidence before the Court, be attended to in precedence to other contentions in the case.
(i) Administration of justice‑‑
‑‑‑‑ Enforcement of discipline and maintenance of decorum during Court proceedings by persons accompanying the parties in the case‑‑Responsibility‑‑‑Principles.
Persons attending Court proceedings either as parties or their supporters must display utmost restraint during the proceedings of the cases. The responsibility to enforce discipline and to maintain decorum during Court proceedings by persons accompanying the parties in a case, is on those who bring them in the Court and they are answerable to Court for their actions. Responsibility" to uphold the dignity of Court and to maintain decorum during the proceedings in a case does not rest on the Presiding Judge alone. The Advocates who appear before the Court in a case are a component of the process of administration of justice being the officers of the Court and therefore, in that capacity they are under an obligation to do everything within their power to uphold‑the dignity of Court and to maintain decorum in the Court room during the proceedings of a case. Court expects that the prosecutor and the counsel for accused shall display utmost restraint during the proceedings of case before the Court and the parties and their supporters will be advised and prevailed upon to behave in a civilized manner during Court proceedings and desist from resorting to measures which may obstruct or interrupt the Court proceedings or bring down the dignity and decorum of the Court.
Syed Iftikhar Hussain Gillani, Farooq H.Naek, Advocates Supreme Court and Raja Abdul Ghafoor, Advocate‑on‑Record for Petitioners (in both Petitions).
Tanvir Bashir Ansari, Deputy Attorney‑General, Raja Maqsit Nawaz, Advocate, Ali Sibtain Fazli, Prosecutor and Ch. Akhtar Ali, Advocate‑on‑Record for the State.
Date of hearing: 18th March, 1999.
JUDGMENT
SAIDUZZAMAN SIDDIQUI, J.‑‑‑The above petitions, after converting into appeals, were disposed of by the following short order on 18‑3‑1999:
"We have heard the learned counsel for the petitioners, the learned counsel for the State and learned Deputy Attorney‑General at length in the above petitions and for reasons to follow separately, these petitions are converted into appeals and are disposed of as under: ‑‑
(1) The order dated 15‑3‑1999, passed by the learned Ehtesa6Bench, closing the evidence of the petitioners is set aside subject to the following:
(i) That the petitioner in Criminal Petition No.65 of 1999, who wishes to appear as her own witness under section 340(2), Cr.P.C. will appear before the learned Ehtesab Bench hearing Reference No.30 on Monday, the 22nd of March, 1999 and on that day, the learned Ehtesab Bench shall record her statement under that section.
(ii) The learned counsel for the petitioner in Criminal Petition No.66 of 1999 has made a categorical statement before‑us that the petitioner in that case does not wish to appear before the Court and record his statement under section 340(2), Cr.P.C., and therefore, in his case no such statement needs to be recorded by the learned Ehtesab Bench:
(iii) 1n Criminal Petition No.65 of 1999 the petitioner has filed a copy of the miscellaneous application filed before the learned Ehtesab Bench on 1‑3‑1999 in which she had made the prayer for issuing summons in respect of as many as 39 witnesses, who are proposed to be examined in the case in her defence. Similarly in Criminal Petition No.66 of 1999 the petitioner's counsel states that his client wishes to examine the following 3 witnesses as defence witness, namely:‑‑
(1) Mr. Abu Bakar Zardari, Advocate.
(2) Superintendent Jail, Landhi, Karachi.
(3) Mr. Salvator Aversano, Advocate (Geneva).
The request for summoning these witnesses may be taken up by the learned Ehtesab Bench on 22‑3‑1999 after completion of the evidence of Ms. Benazir Bhutto under section 340(2), Cr.P.C. or on such other, date as is convenient to the learned Ehtesab Bench, and shall be disposed of in accordance with law keeping in view the provisions of section 265‑F and specially clause (7) thereof. After the statement of petitioner and her witnesses have been recorded in the manner indicated above, the learned Ehtesab Bench will fix the case for arguments both on the application under section 265‑K, Cr.P.C. moved by the petitioner as well as on merits of the case but in doing that the Court will first address to the question of admissibility of the documents produced in the .case , before the learned Ehtesab Bench.
The learned Ehtesab Bench will allow reasonable time to the petitioners for production of the witnesses which the Court ultimately may finally allow them to be summoned in the case. The learned counsel for the petitioners have stated that some of the witnesses are not residents of Pakistan and to summon them visa facilities will be required. The learned Ehtesab Bench if allows summoning of these witnesses, the order summoning the witnesses may be given to the petitioners to enable them to obtain visa for these witnesses but responsibility of producing these witnesses will be that of the petitioners.
It has been brought to our notice that some unpleasant incidents took place during the hearing of the reference before the learned Ehtesab Bench.‑.We sincerely hope that the learned counsel for the petitioner as well as learned prosecutor will show utmost. restraint during the pendency of the case and will do everything within their power to maintain a congenial atmosphere in the Court befitting the dignity of the Court. The learned counsel for the petitioners are, however, told that if some persons come alongwith the petitioners, the responsibility to ensure that they do not cause any obstruction to the hearing of the case will be that of the petitioners and their counsel.
The appeals stand disposed of accordingly."
These are the reasons for the above short order. The appellants are facing trial in Ehtesab Reference (E.R.) No. 30 of 1998 before Ehtesab Bench (E.B.) of Lahore High Court on the allegations that as holders of public offices, the petitioners in league with others, awarded contract of preshipment inspection to M/s. Societe Generale De Surveillance S.A. (S.G.S.) in consideration of having received illegal gratification and undue pecuniary advantage in the form of Kickbacks/commissions and other favours from them. The appellants' statements under section 342, Cr:P.C. were recorded in the said E.R. on 23‑2‑1999, when both the appellants expressed the desire to lead evidence in defence. They were accordingly, directed by the Ehtesab Bench to produce the evidence and the list of witnesses on 1‑3‑1999. On 1‑3‑1999 when the matter was taken up by Ehtesab Bench; no witnesses Were present on behalf of the appellants. However, the counsel for appellant Ms. Benazir Bhutto, submitted a list of witnesses proposed to be examined in the case before the Court and further stated that the list was not complete and was to be supplemented later on by other lists. The counsel for the other appellant Mr. Asif Ali Zardari, however, did not file any list of the witnesses. The case was therefore, adjourned to 8‑3‑1999 and then to 15‑3‑1999 for evidence of the appellants. As no witnesses were produced by the appellants on these two dates, the learned Judges of Ehtesab Bench, on the last‑mentioned date, closed the evidence of appellants and posted the case for arguments on the main case on 16‑3‑1999 with direction that the case would proceed from day to day. The learned Deputy Attorney‑General and the learned counsel for Chief Ehtesab Commissioner (C.E.C.) stated before us that they have concluded their arguments and the case is now' posted for announcement of judgment on 22‑3‑1999. In this background the appellants approached this Court on 17‑3‑1999 for stay of the proceedings of E.R. No.30 of 1998 and for setting aside the order of Ehtesab Bench dated 15‑3‑1999. The petitions were placed in chamber before one of us (Saiduzzaman Siddiqui, J.) on 17‑3‑1999 for interim relief but after hearing the learned counsel for the parties and the learned Deputy Attorney-General it was directed to be fixed in Court today. Accordingly, the petitions have been fixed before us today for hearing.
We have heard Mr. Syed Iftikhar Hussain Gillani, Advocate Supreme Court for Ms. Benazir Bhutto, Mr. Farooq H. Naik for Mr. Asif Ali Zardari, Mr. Ali Sibtain Fazli, Advocate Supreme Court for the referring authority (Chief Ehtesab Commissioner) and Mr. Tanvir Bashir Ansari for the Federation, at length, and after hearing them converted these petitions into appeals and they are disposed of as under.
Mr. Iftikhar Hussain Gillani, the learned counsel for Ms. Benazir Bhutto firstly, contended that over 1000 documents have been produced before the Ehtesab Bench in E.R. 30 of 1998, which are certified copies of the documents obtained from E.R. No.26 of 1998, pending before another Ehtesab Bench of Lahore High Court. The genuineness and authenticity of these documents, according to Mr. Iftikhar Gillani, are disputed by the appellants and in view of the judgment of this Court in Criminal Petition for Leave to Appeal No.208 of 1998 dated 4‑3‑1999 arising from E.R. No.26 of 1998 the admissibility of these documents is yet to be determined by the Bench hearing E.R. No.26 of 1998. It is also contended by Mr. Iftikhar Gillani, the learned Advocate Supreme Court for Ms. Benazir Bhutto, that amongst the documents produced before the Hon'ble Ehtesab Bench in E.R. No.30 of 1998 by the prosecution, there are about 150 foreign documents authenticity and genuineness whereof has been challenged by the appellants and the Hon'ble Ehtesab Bench in order to determine their genuineness and authenticity appointed a commission to visit Switzerland. The order of the Ehtesab Bench appointing the Commission to verify the genuineness and authenticity of the documents from Switzerland has been challenged by the appellants before this Court in Criminal Petitions Nos.46 and 47 of 1999 in which leave has been granted on 12‑3‑1999 and a direction has been given that the report of the Commission, including the documents annexed thereto, shall be kept in a sealed cover by the Registrar, Lahore High Court and shall not be placed before the Ehtesab Bench till the disposal of the appeals by this Court. On these premises, Mr. Iftikhar Gillani, vehemently contended that firstly, the certified copies of the documents obtained from E.R. No.26 of 1998 could not be exhibited in E.R. No.30 of 1998 before the question of their admissibility is determined by the Ehtesab Bench; and secondly, the appellants could not be called upon in these circumstances to enter upon their defence as in the absence of determination of the question of admissibility of these documents, the appellants are unaware as to the exact nature of allegations against them. In the alternative, Mr. Iftikhar Gillani urged that the appellants have a right to appear as their own witnesses in terms of the provisions of section 340(2), Cr.P.C. which opportunity has been denied to them. The learned counsel further contended that in so far the question of summoning of witnesses in the case was concerned, the appellant had filed an application for summoning of witnesses on 1‑3‑1999 in which a specific prayer was made for issuance of summons to the witnesses mentioned therein but the same was not granted. In these circumstances, it is contended by Mr. Syed Iftikhar Gillani, that it cannot be urged that the appellants failed to produce their evidence in the case.
Mr. Farooq H. Naik, the learned Advocate Supreme Court for Asif Ali Zardari appellant in the other appeal, however, categorically stated that his client does not wish to appear as his own witness under section 340(2), Cr.P.C. in E.R. No.30 of 1998 but strenuously argued that in his statement filed before the Ehtesab Bench under section 265‑F(5), Cr.P.C. on 8‑3‑1999, he had specially stated that he wanted to examine the following, three witnesses:‑‑
(1) Superintendent, District Jail, Malir, Karachi to produce all the relevant records of my arrest and detention in District Jail, Malir, Karachi with effect from November, 1990 till March, 1993.
(2) Mr. Salvatore Averson, Advocate, Geneva.
(3) Mr. Abu Bakar Zardari, Advocate.
Mr. Naik, thereof while adopting the arguments of Mr. Iftikhar Gillani, stated that in the alternative, he would pray that appellant Asif Ali Zardari be allowed to produce the 3 witnesses mentioned above in his defence.
Mr. Ali Stain Fazli, the learned Advocate Supreme Court for Chief Ehtesab Commissioner and Mr. Tanvir Bashir Ansari, the learned Deputy Attorney‑General on the other hand contended that the appellants have deliberately avoided to produce any evidence in the case and therefore, the learned Ehtesab Bench had no option but to close their evidence. The learned counsel further jointly contended that the application for summoning the witnesses though contained the names of large number of witnesses but it did not disclose the substance of the evidence of these witnesses and therefore, the Court was in no position to determine the relevancy of their evidence in the case. The learned counsel therefore, jointly contended that the only purpose of the present proceedings is to delay the proceedings of E.R. No.30 of 1998 otherwise the appellants could have produced at least some of these witnesses if they were really serious in the proceedings of the case when the case came up for hearing on 1‑3‑1999, 8‑3‑1999 and 15‑3‑1999.
After hearing the learned counsel for. the appellants, the learned counsel for C. E. C. and the learned D. A.‑G. at length, we are of the view that notwithstanding the facts that the appellants failed to produce any witness when E.R. No.30 of 1998 was taken up for hearing on 1‑3‑1999, 8‑3‑1999 and 15‑3‑1999, we allow appellant Ms. Benazir Bhutto to appear as her own witness in E.R. No.30 of 1998 before the Ehtesab Bench, under A section 340(2), Cr.P.C. and the appellant will also be allowed a fair opportunity to examine witnesses in their defence within the bounds of law.
The learned counsel for the appellants jointly contended that the appellants may not be asked to enter upon their defence in E.R. No.30 of 1998 until such time the question of admissibility of the documents produced in the Ehtesab Reference is determined by the Bench as in the absence of such determination, the appellants are unaware of the exact nature of the allegations against them. The contention does not appear to be correct. The appellants are being tried for alleged offences of "corruption and corrupt practices" defined in section 3 of Ehtesab Act, 1997 (hereinafter to be referred as "the Act"). Section 12 of the Act which deals with the procedure for trial of cases under the Act reads as follows:‑‑
"12. Provisions of the Code to apply, etc. ‑‑(1) Notwithstanding anything contained in any other law for the time being in force, unless there is anything inconsistent with the provisions of this Act, the provisions of the Code of Criminal Procedure, 1898 (Act V of 1898), shall mutatis mutandis, apply to the proceedings under this Act.
(2) Subject to subsection (1), the provisions of Chapter XXII‑A of the Code shall apply to trials under this Act.
(3) Notwithstanding anything contained in subsection (1) or subsection (2) or in any law for the time being in force, the Court may, for reasons to be recorded, dispense with any provision of the Code and follow such procedure as it may mean fit in the circumstances of the case. "
In terms of clause (1) of section 12 of the Act, the procedure prescribed under the Code of Criminal Procedure, 1898 (hereinafter to be referred as "the Code") for trial of cases is made applicable to proceedings under the Act except where the provisions of the Code are found in conflict with the provisions of the Act. In the latter case, the provisions in the Act apply. Subject to clause (1) of section 12 ibid, Chapter XXII‑A of the Code (sections 265‑A to 265‑N) which contains provisions relating to the trial of cases before High Court and Court of Session has been specifically made applicable in its totality to the trials under the Act. Section 265‑C ibid, specifies the statements and documents which are to be supplied to the accused in the case before the framing of the charge. Section 265‑D provides that the Court may frame the charge against the accused after perusal of police report or the ‑complaint, as the case may be, and other documents and statements filed by the prosecution, if the Court is of the opinion that there is sufficient ground for proceedings against the accused in the case. After framing of the charge, the Court calls upon the accused under section 265‑E whether he pleads guilty to the charge or not. In case he pleads guilty to the charge, he may he convicted by the Court then and there. However, if he denies the charge, he may be asked whether he has any defence. Section 265‑F ibid. which deals with the manner of production of evidence by the prosecution and the accused at the trial of the case reads as follows.‑‑
"265‑F. Evidence for prosecution ‑‑(1) if the accused does not plead guilty or the Court in its discretion does not convict him on his plea, the Court shall proceed to hear the complainant (if any) and take all such evidence as may be produced in support of the prosecution:
Provided that the Court shall not be bound to hear any person as complainant in any case in which the complaint has been made by a Court.
(2) The Court shall ascertain from the public prosecutor or, as the case may be, from the complainant, the names of any persons likely to be acquainted with the facts of the case and to be able to give evidence for the prosecution, and shall summon such persons to give evidence before it.
(3) The Court may refuse to summon any such witness, if it is of opinion that such witness is being called for the purpose of vexation or delay or defeating the ends of justice. Such ground shall be recorded by the Court in writing.
(4) When the examination of the witnesses for the prosecution and the examination (if any) of the accused are concluded, the accused shall be asked whether he means to adduce evidence.
(5) If the accused puts in any written statement, the Court shall file it with the record.
(6) If the accused, or any one of several accused, says that he means to adduce evidence, the Court shall call on the accused to enter on his defence and produce his evidence.
(7) If the accused or any one or several accused, after entering on his defence, applies to the Court to issue any process for compelling the attendance of any witness for examination or the production of any document or other thing, the Court shall issue such process unless it considers that the application is made for the purpose of vexation or delay or defeating the ends of justice such ground shall be recorded by the Court in writing. "
The above provisions of section 265‑F of the Code which apply to the proceedings of trials under the Act, clearly provide that in the event of[ denial of charge by the accused, the Court shall record evidence offered by the prosecution in support of the charge in the case against the accused. The prosecutor may apply to the Court for summoning the witness and the Court shall summon such witness after ascertaining from the prosecutor the names of the witnesses who are acquainted with the facts of the case. The Court may, however, refuse to summon a prosecution witness if it is of the opinion; which is to be recorded in writing, that the witness is being .summoned for the purposes of vexation or to cause delay of the trial or to defeat the ends of justice. On conclusion of the evidence of prosecution the Court shall examine the accused and ask him if he intends to adduce any evidence. If the accused files any written statement, the Court shall keep the same on record and if the accused elects to lead evidence, the Court shall call upon him to enter his defence and produce his evidence. After accused has entered his defence as aforesaid, he may apply to the Court as provided in section. 265‑F (7) ibid for the issuance of process for compelling the attendance of any witness for examination in the case which the Court shall allow unless for reasons to be recorded in writing, the Court considers that the purpose of making the application is vexatious or to delay the proceedings or to defeat the ends of the justice. In a case where accused does not adduce evidence in his defence, the Court on close of prosecution case and examination of accused (if any) may ask the prosecutor to sum up his case and then call upon the accused to reply. However, if the accused leads evidence in his defence, the Court shall call upon the accused to sum up his case on the close of defence evidence and then call upon the prosecutor to reply. The Court under section 265‑H shall either acquit or convict the accused, if after framing of the charge, he is found not guilty or, guilty as the case may be.
From the above discussion, it is quite clear that the accused is to be' asked by the Court to enter on his defence and to produce his evidence, after the prosecution has concluded its evidence, the accused has been examined under section 342; Cr.P.C. and on being asked by the Court the accused expresses his desire to lead evidence in his defence in the case. Although, the statement of appellants recorded under section 342.‑Cr.P.C. by the Court in E.R. No.30 of 1998 has not been produced before us but it is not denied that the statement of the appellants under section 342, Cr.P.C. were recorded by the Court on 23‑2‑1999 after the prosecution closed his evidence in the case and both the appellants expressed their desire to lead the evidence in defence in their statements under section 342, Cr.P.C. The learned counsel for the appellants have not been able to point out any provision in the Code which requires that where the prosecution has produced documents in its evidence then unless the question of admissibility of the documents so produced, is determined by the Court, the accused cannot be called upon to enter on its. defence. The question, of admissibility of a document tendered in the evidence, if objected to by an accused, can either be decided by the Court at the time of receiving the document in evidence or it may postpone its consideration at some later stage. The contention of the appellants that unless the question of admissibility of the documents produced in the evidence by the prosecution is .determined, they cannot be asked to enter upon their defence, has no merit. As discussed above, the accused are charged in a criminal case on basis of the evidence produced by the prosecution. Similarly, the object of examination of an accused under section 342, Cr.P.C. is to draw his/her attention to the circumstances and pieces of evidence in the case against him/her which are relied by the prosecution or which are likely to influence the mind of the Court. Therefore, the accused is called upon to enter on his defence not with reference to admissibility or otherwise of any evidence produced by the prosecution but with reference to circumstances and points appearing in the evidence of prosecution against the accused to which his attention is drawn while examined under section 342, Cr.P.C. The question of admissibility of any piece of evidence produced by the prosecution in the case, therefore, has a bearing to the conviction or acquittal of the accused in the case on the basis of such evidence. If the appellants have objected to the admissibility of any documentary or oral evidence against them in the case, they are free to press the objection before the Court at the stage of arguments which will be disposed of in accordance with the law. They are, however, not entitled under any law to ask for the postponement of their defence in the case until determination of the question of admissibility of either documentary or oral evidence in the case produced by the prosecution.
The next question which arises for determination in these cases is, whether the evidence of the appellants was rightly closed in the cases by the learned Judges of the Ehtesab Bench. The learned counsel for C.E.C. and the learned D.A.‑G. jointly contended that the appellants were afforded ample opportunity in the cases to adduce their evidence but they deliberately failed to produce their evidence and therefore, the learned Judges of Ehtesab Bench, were fully justified in closing their evidence in the case. The learned counsel for C.E.C. and the learned D.A.‑G. further jointly contended that the appellants never applied for summoning of any particular witness before the Ehtesab Bench and in any case the fact that they have applied for summoning of as many as 39 witnesses without disclosing the substance of their evidence, show that their sole effort is to delay the proceedings and to obstruct the process of Court. The contention does not appear to be correct. .
We have already reproduced above section 12 of the Act which makes the previsions of the Code applicable to proceedings under the Act. According to section 12(2) ibid; the provisions contained in Chapter XXII‑A of the Code relating to procedure for trial of cases before High Court and Court of Session, equally apply to trial under the Act. The learned counsel for C.E.C. and the learned D.A.‑G. are unable to point out any provision in Chapter XXII‑A of the Code or any other provision in the Act or the Code which required that an accused while applying to summon a witness in defence must also disclose the substance of his evidence. No doubt, under section 12 (3) of the Act, the Court has been vested with the power to dispense with the procedure prescribed under the Code. and to follow any other procedure it may deem fit in the circumstances of the case but to do that the Court has to record his reasons. It is not contended before us that the Ehtesab Bench had either elected not to follow the procedure prescribed under the Code for trial or that it had recorded reasons for following a procedure different from the one prescribed under the Code. Similarly, the contention of the learned counsel for the C.E.C. and D.A.‑G. that the fact that appellants have proposed to summon as many as 39 witnesses in defence goes to show that their main aim is to protract the proceedings, has not impressed us. Under section 265‑F(7) ibid, the Court has full power to decline to summon any witness in defence if the Court is of the view that the F application has been made for the purpose of vexation or to delay the proceedings or to defeat the ends of justice. There is on record before us an application filed by appellant Benazir Bhutto before the Ehtesab Bench on 1‑3‑1999 in which a request was made to summon the witnesses mentioned in the application, in defence. There is nothing on record before us to show that this application was rejected by the Court on the ground that it is either filed for the purposes of vexation or to delay the proceedings of the case or to obstruct the course of justice. Similarly, the record before us does not show that the Court asked appellant Benazir Bhutto, if she wanted to appear as her own witness in the case under section 340(2), Cr.P.C. but she declined. Section 340(2) casts a duty on the Court to inform the accused that he/she 'has a right under the law to make a statement on oath and it is his option with no risk attaching it to either make that statement or not to make that statement'. See PLD 1991 SC 787. The fact that Ms. Benazir Bhutto was examined by the Court under section 342, Cr.P.C. in the case, would not make any difference as. the object of examination of an accused under section 342, Cr.P.C. is quite different from his ‑evidence under section 340(2), Cr.P.C. In the former case the accused is informed by the court of the points or material brought on record by the prosecution which is against him or which may influence the mind of the. Court while in the latter case, the evidence is offered to disprove the case set up by the prosecution against him. Before us, the appellant Ms. Benazir Bhutto has categorically taken the stand that she wanted to appear as her own witness under section 340(2), Cr.P.C. in the case but no opportunity was allowed to her. No doubt, the appellant Asif Ali Zardari, has declined to examine himself as his own witness in the case under section 340(2), Cr.P.C. but in his written statement filed in the case under section 265‑F(5), Cr.P.C. on 8‑3‑1999, he expressed the desire to produce 3 witnesses whose names were mentioned. There is also on record before us an application under section 561‑A, Cr.P.C. dated 8‑3‑1999 filed on behalf of Asif Ali Zardari by Mr. Farooq H. Naik, Advocate, wherein request was made to issue summons to Superintendent. Landhi Jail to produce the record pertaining to appellant Asif Ali Zardari from 1990 up to March, 1993. and also to Mr. Abu Bakar Zardari, Advocate. This application also contained a request to direct Pakistan Embassy at Bern, Switzerland, to issue visa to Mr. Salvatore Aversano, Advocate, who was proposed to be examined as a witness in the case. This application too was riot disposed of by the Court .
In the above stated circumstances, as the record does not show that appellant Ms. Benazir Bhutto was afforded an opportunity to examine herself under section 340(2), Cr.P.C. as her own witness in the case and she declined to avail the same, we are inclined to allow her the opportunity to examine herself under section 340(2), Cr.P.C. as her. own witness in the case. We accordingly, direct that if Ms. Benazir Bhutto appears before the Hon'ble Ehtesab Bench on 22‑3‑1999, her statement under section 340(2), Cr.P.C. may be recorded in the case as her own witness. Since Mr. Asif Ali Zardari, the other appellant before us, has declined to appear as his own witness in the case, under section 340(2), Cr.P.C. no such opportunity needs to be extended to him by the Court.
The application dated 1‑3‑1999 filed by Ms. Benazir Bhutto and the application under section 561‑A, Cr.P.C. filed by Asif Ali Zardari for summoning of witnesses or any other application for summoning of the witnesses filed by the two appellants which is pending on the record before the Ehtesab Bench may be taken up by the Hon'ble Ehtesab Bench, after completion of the statement of Ms. Benazir Bhutto under section 340(2), Cr.P.C. either on 22‑3‑1999 or on such other date convenient to Court and will be disposed of in accordance with the law. The learned counsel for the appellants contended that some of witnesses proposed to be examined by the appellants in the case are the residents abroad and therefore, the Ehtesab Bench may be directed to issue orders to the concerned Embassy of Pakistan in the countries, where these witnesses are resident, to issue them necessary visa to come to Pakistan to record their evidence in the case. We are unable to grant the request of the learned counsel for the appellants as the question of issuance of visa is a matter of policy of the Government over which the Court cannot exercise any control. However, if the Hon'ble Ehtesab Bench grants the request of appellants to examine the witnesses who are resident abroad, it may grant copy of such order to appellants to enable them to' approach the Government for grant of visa to them to come to Pakistan to record their evidence in the case. However, the entire responsibility of producing these witnesses in the cases would be solely that of appellants. While granting the applications of appellants to summon the witnesses, in the case, the Hon'ble Ehtesab Bench may allow reasonable time to appellants to produce these witnesses keeping in view all the circumstances.
On conclusion of the defence evidence as aforesaid, the arguments on the main case as well as on the applications filed under section 265‑K, Cr.P.C. may be heard by the Hon'ble Ehtesab Bench simultaneously. However, consideration of objections raised to the admissibility of documents by the appellants at the time of their production in evidence before the Court, be attended to in precedence to other contentions in the case. The order of Ehtesab Bench dated 15‑3‑1999, closing the side of appellants is accordingly set aside and appeals are disposed of in, the terms stated above.
Before parting with the case, we may mention here that our attention was drawn to some unpleasant incidents which occurred before the Hon'ble Ehtesab Bench, during the proceedings of E.R. No.30 of 1998. These incidents were also reported widely in the national press. Needless to say, that such incidents seriously affect the process of administration of justice besides lowering the dignity and prestige of the Courts. Mr. Iftikahr Gillani, the learned Advocate Supreme Court for Ms. Benazir Bhutto, contended that on account of presence of large number of armed personnels of law enforcing agency in the precinct of the Court room, on every date of hearing the concept of open trial in the Court is defeated and the parties and their counsel also feel scared. The learned counsel for C.E.C. who is also a prosecutor in E.R. No.30 of 1998, on the other hand, pointed out that large number of people accompany the appellants on each date of hearing in the Court and attempts are made to disrupt the proceedings by creating commotion both within and outside the Court room. While we fully subscribe to the concept of open trials in Court, we cannot overlook the growing number of incidents in the Courts, where litigants and their supporters have gone to the extent of resorting to violence during Court proceedings and using intemperate language against the Court. We are therefore, constrained to observe that persons attending Court proceedings either as parties or their supporters must display utmost restraint during the proceedings of these cases. The responsibility to enforce discipline and to maintain decorum during Court proceedings by persons accompanying the parties in a case, is on those who bring them in the Court and they are answerable to Court for their actions. We need not point out that the responsibility to uphold the dignity of Court and to maintain decorum during the proceedings in a case does not rest on the Presiding Judge alone. The Advocates who appear before the Court in a case are a component of the process of administration of justice being the officers of the Court and therefore, in that capacity they are under an obligation to do everything within their power to uphold the dignity of Court and to maintain decorum in the Court room during the proceedings of a case. We, therefore, expect that the learned prosecutor and the counsel for appellants shall display utmost restraint during the proceedings of case before Hon'ble Ehtesab Bench and the parties and their supporters will be advised and prevailed upon to behave in a civilized manner during Court proceedings and desist from resorting to measures which may obstruct or interrupt the Court proceedings or bring down the dignity and decorum of the Court. With these observations, the appeals stand disposed of in the terms stated above.
M.B.A./B‑32/S Order accordingly
P L D 2000 Supreme Court 813
Present: Irshad Hasan Khan, C. J.
Muhammad Bashir Jehangiri
and Nazim Hussain Siddiqui, JJ
NASEER AHMED ‑‑‑Appellant
versus
THE STATE‑‑‑Respondent
Criminal Appeal No. 133 of 1997, decided on 3rd April, 2000.
(On appeal from the judgment dated 4‑11‑1996 of the Lahore High Court, Lahore passed in Criminal Appeal No. 198 of 1994).
(a) Penal Code (XLV of 1860)‑‑
‑‑‑‑S. 302/308‑‑‑Constitution of Pakistan (1973), Art.185(3)‑‑‑Sentence‑‑Qatl‑i‑Amd‑‑‑Minor age of the accused at the time of offence‑‑‑Leave to appeal was granted by ‑Supreme Court to consider the proposition as to whether or not the accused had attained sufficient maturity at the time of commission of the crime in order to award him the prescribed sentence under second proviso to S.308, P.P.C. whereunder he could be sentenced to rigorous imprisonment which might extend to 14 years as Ta'zir.
(b) Penal Code (XLV of 1860)‑‑
‑‑‑‑S. 302/308‑‑‑Appraisal of evidence ‑‑‑Sentence‑‑‑Qatl‑i‑Amd‑‑‑Age of the accused at the time of offence‑‑‑Determination‑‑‑Proof‑‑‑Neither Trial Court nor the High Court had noticed the second proviso to 5.308, P.P.C. nor had adverted to determine whether at the time of commission of the offence the accused was in fact minor, and if so how old he was‑‑‑Mere reliance on the School Leaving Certificate by the Courts below was not enough to come to a definite conclusion as to the age of the minor at the time of the commission of the offence‑‑‑Ossification test or any other medical test for that purpose should have also been got conducted and the age of the accused determined in accordance therewith and then decided the case accordingly‑‑‑Sentence of accused was set aside in circumstances and the case was remanded to the Trial Court to determine the question as to what was the age of the accused at the time of occurrence and if he was found to be minor, whether he had. attained sufficient maturity so as to be able to realize the consequences of his act and then award him proper and legal sentence.
Rafique Javed Butt, Advocate Supreme Court for Appellant.
Muhammad Zaman Bhatti, Advocate Supreme Court and Rao Muhammad Yousaf Khan, Advocate‑on‑Record (absent) for the State.
Date of hearing: 3rd April, 2000.
JUDGMENT
MUHAMMAD BASHIR JEHANGIRI, J.‑‑This appeal by leave, is by Naseer Ahmad, appellant, who was convicted by the learned Sessions Judge, Khushab, under section 302, P.P.C. for committing 'Qatl‑i‑Amd' of Muhammad Ismail deceased and sentenced to imprisonment for life and a fine of Rs.20,000 or in default to undergo rigorous imprisonment for one year. He was also directed to pay a sum of Rs.25,000 as compensation under section 544‑A,,Cr.P.C. which, if recovered, was to be paid to the legal heirs of the deceased or in default thereof he was to suffer rigorous imprisonment for six months.
In appeal, the learned Judge in Chambers of the Lahore High Court, Lahore, maintained the conviction of the appellant for committing 'Qatl‑i-Amd' of Muhammad Ismail deceased, but since the convict‑appellant was found minor, he could only have been convicted under section 302, P.P.C. read with section 308. P P‑C‑ therefore, he was sentenced to pay the amount of Rs.1,42,322.29 as Diyat to the legal heirs of the deceased. The convict‑appellant filed the petition for leave to appeal.
Leave to appeal was granted by this Court to consider the proposition as to whether or not the appellant‑convict had attained sufficient maturity at the time of commission of the crime in order to award him the A prescribed sentence under second proviso to section 308, P.P.C. whereunder he could be sentenced to rigorous imprisonment which may extend to 14 years as Ta'zir. .
It appears that the convict‑appellant having failed to pay the amount of Diyat is still lodged in Jail. Mr. Rafique Javed Butt, learned Advocate Supreme Court contended that the learned Single Judge of the High Court has ignored the mandatory provisions of first proviso to section 308(1), P.P.C. which reads as under:‑‑
"Provided that, where the offender is minor or insane, Diyat shall be payable either from his property or by such person as may be determined by the Court. "
In this context the learned counsel further submitted that the first proviso having been ignored, the convict‑appellant has been prejudiced inasmuch as under the second proviso to subsection (2) of section 331 of the P.P.C. where a. convict fails to pay Diyat or any part thereof within 'the period specified in subsection (1), the convict may be kept in jail and dealt with in the same manner as if sentenced to simple imprisonment until the Diyat is paid in full or may be released on bail if he furnishes security equivalent to the amount of Diyat to the satisfaction of the Court.
Mr. Muhammad Zaman Bhatti, learned Advocate Supreme Court, appearing on behalf of the State, has controverted the contentions of the learned Advocate Supreme Court representing the appellant and invited our attention to the second proviso to section 308, P.P.C. laying down that where at the time of committing 'Qatl‑i‑Amd' the offender being a minor, had attained sufficient maturity or being insane, had a lucid interval so as to be able to realise the consequences of his act, he may also be punished with imprisonment of either description for a term which may extend to fourteen years as Ta'zir. , 7. The learned counsel for the parties had conceded before us that neither the learned trial Judge nor the learned Judge in Chambers of the High Court had noticed this provision of law nor had adverted to determine whether at the time of commission of the offence the convict‑appellant was in fact minor, if so bow old he was. It may further be noticed that mere reliance on the School Leaving Certificate by the trial Judge as also by the learned Single Judge of the High Court was not enough to come to a definite conclusion as to the age of the minor. at the time of the commission of the offence. Additionally for that purpose, the ossification test or any other medical test should have also been got conducted and the age of the convict appellant determined in accordance therewith and then decided the case accordingly.
In this view of the matter, we are constrained to accept this appeal, set aside the sentence of the convict‑appellant and remand the case to the learned trial Judge to determine the question as to what was the age of the convict‑appellant at the time of occurrence and, if he is found to be minor, whether he had attained the sufficient maturity so as to be able to realize the consequences of his act and then award him proper and legal sentence. The trial shall be concluded within six months from today under intimation to the Registrar of this Court.
N.H.Q./N-9/S Case remanded.
P L D 2000 Supreme Court 816
Present: Irshad Hasan Khan, C. J., Munir A. Sheikh and Nazim Hussain Siddiqui, JJ
MUHAMMAD AFZAL‑‑‑Appellant
versus
THE STATE‑‑‑Respondent
Criminal Appeal No.215 of 1997, decided on 30th March, 2000.
(On appeal from the judgment dated 30‑6‑1997 of Balochistan High Court, Quetta, passed in Criminal Appeal No. 124 of 1997).
(a) West Pakistan Arms Ordinance (XX of 1965)‑‑‑
‑‑‑‑S. 13‑E‑‑‑Constitution of Pakistan (1973), Art. 185(3)‑‑‑Leave to appeal was granted by Supreme Court to accused to consider whether C.I.A. (Criminal Investigation Agency) was not competent to investigate the case and Police was the competent Authority for the same.
(b) West Pakistan Arms Ordinance (XX of 1965)‑‑‑
‑‑‑‑S. 13‑E‑‑‑Criminal Procedure Code (V of 1898), S.156‑‑‑Appraisal of evidence‑‑‑Investigation conducted by C.I.A. (Criminal Investigation Agency) ‑‑‑Validity‑‑‑C.I.A. personnel, despite knowing it very well that they were not empowered to investigate the case, had done so deliberately violating the provisions of S.156, Cr.P.C.‑‑‑Although C.I.A. personnel had prior information about the offence which was likely to be committed, yet they had not passed on this information to the concerned police and took upon themselves the task of investigation which was in violation of law and against the principle of supremacy of law‑‑‑Pistol recovered in the case without any valid explanation was not sent to the Ballistic Expert to find out if it was automatic, semi‑automatic or ordinary‑‑‑Mere submission of chargesheet before the Special Court would not give rise to the presumption that the pistol was semi‑automatic‑‑‑Pistol should have been referred to the Ballistic Expert in order to determine its exact calibre/status, as it was necessary to determine the issue of jurisdiction of the Court‑‑‑Special Court constituted under the Suppression of Terrorist Activities (Special Courts) Act, 1975, could not proceed with the matter unless it was established that the offence was covered by Schedule of the said Act‑‑‑Necessary procedure at the time of the recovery of the said pistol was also not followed as it was not sealed‑‑‑Identification of the pistol at such stage was not possible and the case could not be remanded to the Court having jurisdiction in the matter as no steps were taken for maintaining its identity‑‑‑Accused was acquitted in circumstances.
State through Advocate‑General, Sindh v. Bashir and others PLD 1997 SC 408 ref.
Nemo for Appellant. .
Raja Abdul Ghafoor, Advocate‑on‑Record for the State.
Date of hearing: 30th March, 2000.
JUDGMENT
NAZIM HUSSAIN SIDDIQUI, J.‑‑Vide order dated 21‑10‑1997 leave was granted by this Court to the appellant to consider whether C.LA. was not competent to investigate and police was the competent authority for the same.
This appeal arises from judgment dated 30‑6‑1997 of learned Judge of High Court of Balochistan, Quetta, whereby the judgment dated 26‑5‑1997 of learned Special Judge Suppression of Terrorist Activities, under section 13‑F. of Arms Ordinance, 1965, convicting the appellant and sentencing him to suffer 2 years' R.I. and a fine of Rt_2,000 or in default thereof to further undergo 2 months' S.I., was maintained.
The prosecution case, in brief, is that C.I.A. staff consisting of Tariq Manzoor, S.‑I., Maqsood Ahmed, S.‑I., Jan Muhammad S.‑I. Amanullah, A.S.‑I., Akbar Resani, A.S.‑I., Abdullah, Muhammad Ayub and Umar Atta. H_Cs. and others on receipt of spy information intercepted a Vehicle (pick‑up) bearing No.SL‑3743 and recovered from it huge quantity of narcotics and also an unlicensed .30 bore pistol and 34 cartridges. which allegedly were recovered from possession of the appellant. F.I.R. No.73 of 1996 was registered on 27‑4‑1996 and on completion of investigation charge‑sheet was submitted before the Special Judge, Quetta. Separate challan in respect of said narcotics was submitted before this competent Court.
On assessment of the evidence brought on record, learned trial Judge convicted the appellant as mentioned earlier. His appeal was dismissed by the High Court, which judgment has been impugned m this appeal.
Section 156, Cr.P.C. speaks about the investigation into cognizable case. The subsections (1) and (2) are relevant for this case and are reproduced below:‑‑
"156.‑‑(1) Investigation into cognizable cases.‑‑Any officer incharge of a police station may, without the order of a Magistrate, investigate any cognizable case which a Court having jurisdiction over the local area within the limits of such station would have power to inquire into or try under the provisions of Chapter XV relating to the place of inquiry or trial.
(2) No proceedings of a police officer in any such case shall at any stage be called in question on the ground that the case was one which such officer was not empowered under this section to investigate."
A plea was raised before the High Court that since investigation was conducted in violation of above section it vitiated entire trial and serious prejudice was caused to the appellant. Learned High Court, dealing with this contention held that in view of subsection (2) (supra) no prejudice was caused to the appellant. While recording above finding, the High Court also referred to the case reported as State through Advocate‑General, Sindh v. Bashir and others PLD 1997 SC 408.
In above case a Full Bench of this Court comprising 4 learned Judges examined and determined the scope of section 156, Cr.P.C. Mr. Justice Muhammad Ajmal Mian (as he then was) who authored the main judgment at pages 420 and 421 observed as follows:‑
"The above submission seems to be fallacious. Any alleged illegal practice cannot negate an express provision of a statute. It is unfortunate that a Government functionary which is entrusted with the enforcement of law should be guilty of breach of a provision of law. It is high time that efforts should be made to establish the "° supremacy of law instead of relying upon an illegal practice.
As regards the question, as to whether the above illegality/irregularity if already committed by the C.I.A. personnel would vitiate the trial, it may be observed that subsection (2) of section 156. Cr P.C expressly provides that: 'No proceeding of a police officer in any such case shall at any stage be called in question on the ground that the case was one which such officer was not empowered under this section to investigate. It is an admitted position that the C.I.A. is part of the Police Force. It is in fact a special branch carved out from the police force for special purpose. The violation of section 156(1) of the Cr.P.C. may not vitiate trial if no serious prejudice has been caused to the accused person concerned resulting in miscarriage of justice in view of above '.: subsection (2) of section 156. Cr.P.C. but it does not mean that the C.I.A. personnel should knowingly violate the above provision of the Cr.P.C. On the contrary, they are legally duty bound to ensure the supremacy of law."
The record reveals that though C.LA. personnel knew it very well that they were not empowered to investigate this matter, vet, they had done so and in this way deliberately violated the provisions of section 156, Cr.P.C. Although they had prior information about the offence which was likely to be committed, yet, they had not passed on this information to the concerned police and took upon themselves the task of investigation which, we feel, was not proper. What they had done was in violation of law and was also against the principle of supremacy of law.
The case was tried under the Suppression of Terrorist Activities (Special Courts) Act, 1975 and being a Special Court it could only proceed with the scheduled offence as mentioned in the Schedule of said Act, including the offences under sections 8, 8 and 10 of Pakistan Arms Ordinance, 1965 if committed in respect of a cannon, grenade, bomb or rocket; 150" or a light or heavy automatic or semi‑automatic weapon such as kalashnikov, a G‑III rifle or any other type of assault rifle. It is noted that Special Courts constituted under above Act, are Courts of limited jurisdiction and are only competent to proceed with the matters, which are mentioned in the Schedule of the Act. In this particular case the pistol in question, without any valid explanation, was not sent to the ballistic expert to find out if it was automatic or semi‑automatic or ordinary. Learned A.‑G. before the High Court had contended that since the charge‑sheet was submitted before Special Judge, as such it was to be presumed that it was semi‑automatic. This argument found favour of the High Court and the pistol was treated as semiautomatic.
We are not inclined to accept above finding. In order to determine the exact calibre/status of the weapon it should have been referred to the expert as it was necessary to determine the issue of jurisdiction of the Court, learned High Court dealing with this point observed that irrespective of the fact that whether it was semi‑automatic or otherwise the appellant was to be tried by a Court and either he would have been convicted or acquitted and so was done by Special Judge. Again, we do not agree with above finding and hold that Special Judge could not proceed with the matter unless it was established the offence was covered by Schedule of the Act.
It is noted, as appears from the judgment of the High Court, that at the time of recovery of said pistol necessary procedure in that regard was not followed. It seems that it was not sealed. Identification of said weapon at this stage would, not be possible. Normally we would remand the case to the Court having jurisdiction in the thatter, but now it is not possible as no steps were taken for maintaining its identity.
In consequence, the appeal is allowed, impugned judgments of the trial Court and the High Court are set aside, the appellant is acquitted and his bail bond stands discharged. It is, however, made clear here that this judgment would have no effect on the narcotics case, which was registered against the appellant alongwith this case and the same would be decided, on its own merits without being influenced by any observation made earlier.
N
P L D 2000 Supreme Court 820
Present: Rashid Aziz Khan and Iftikhar Muhammad Chaudhary, JJ
MUHAMMAD SADIQ‑‑‑Petitioner
versus
Mst. BASHIRAN and 9 others‑‑‑Respondents, Civil Petition No. 1020‑L of 1999, decided on 10th April, 2000.
(On appeal from the order dated 1‑7‑1999 passed by Lahore High Court, Lahore in Civil Revision No.3319 of 1994 in C.M. 735 of 1996).
(a) Civil Procedure Code (V of 1908)‑‑‑
‑‑‑‑Ss. 115 & 151‑‑‑Limitation Act (IX of 1908), Art.181‑‑‑Revision‑‑Object‑‑‑Dismissal of revision after admission for non‑prosecution ‑‑Legality‑‑‑Procedure‑‑‑No provision for recalling/setting aside the order dismissing a revision for non‑prosecution having been provided, to overcome such situation inherent jurisdiction of the Court could be invoked which .had been conferred upon trial, appellate and revisional Courts in terms of S.151, C.P.C. subject to the condition that no other specific provision to deal with the issue was available under Civil Procedure Code, 1908‑‑‑No limitation having been prescribed for filing an application to invoke Jurisdiction of the Court under 5.151, C.P.C. in the Limitation Act, 1908 or S.48, C.P.C. residuary provision of Art.181, Limitation Act, 1908, would be attracted which provide period of three years for the purpose‑‑‑Principles.
Dismissal of a civil revision after its admission by the Court seized with it for non‑prosecution is not legally well‑recognized for the reason that jurisdiction of a revisional Court under section 115, C.P.C. is invoked by an aggrieved person to point out illegalities or irregularities or the jurisdictional defects in the proceedings and the orders passed by the subordinate forums. Therefore, on entertaining a revision petition; Court exercises its supervisory jurisdiction to satisfy itself as to whether jurisdiction has been exercised properly and whether proceedings of the subordinate Courts do suffer or not from any illegality or irregularity. In other words, after filing a revision, matter rests between the revisional and subordinate Courts.
Court after having entertained a civil revision instead of dismissing it in default, may make efforts to dispose it of in accordance with the parameters laid down by section 115, C.P.C.
There is no doubt that civil revision under section 115, C.P.C. entertained by the High Court has to be disposed of in view of provisions of section 117, C.P.C. a thorough survey of C.P.C. will indicate that there is no provision for recalling/setting aside the order dismissing a revision for non‑prosecution: There are many other proceedings under C.P.C. in respect of which no procedure has been laid down if the same is dismissed for non‑prosecution.
But a litigant suffering from such difficulty, cannot be left without any remedy because law favours adjudication of matters on merits unless there exists some insurperable practical obstacle.
Therefore, to overcome such situation inherent jurisdiction of the Court can be invoked which has been conferred upon trial, appellate and revisional Courts in terms of section 151, C.P.C. However, subject to the condition that no other specific provision to deal with the issue is available under C.P.C.
There is no specific provision in Civil Procedure Code to restore a revision dismissed for non‑prosecution, therefore, an aggrieved party can claim relief under section 151, C.P.C.
For filing of an application to invoke inherent jurisdiction of Court no limitation has been prescribed under a particular Article of Limitation Act. Therefore, the application so filed shall be governed by residuary provision i.e. Article 181 of Limitation Act, according to which application for which no period of limitation is provided elsewhere in the Schedule or section 48 of Code of Civil Procedure, prescribed time limit shall be three years when the right to sue accrues.
In the present case application under Order. IX, Rule 9, C.P.C. being not competent High Court had to treat same as an application under section 151, C.P.C. As the application was filed within the prescribed period of three years, therefore, it was not obligatory upon the respondents to have explained the delay of each day.
Mirza Muhammad Saeed v. Sahabud Din and 8 others PLD 1983 SC‑385; Naoomal Tourmal v. Tarachand Sobharaj and another AIR 1933 Sindh 200; Bharat Chandra Nath and another v. Iasin Sarkar (1916‑17) 21 CWN 769; Sourendra Nath Mister v. Jatindra Nath Ghose 32 CWN 811; Syed Qasim Shah v. Deputy Commissioner, Kachhi District and another PLD 1976 Quetta 42; Wali and others v. Manak and others PLD 1965 SC 651; Mrs. Mehr Sultan Jung v. Qurban Hussain 1972 SCMR 73 and House Building Finance Corporation v Mrs. Sarwar Jehan PLD 1992 Kar 329 ref.
(b) Civil Procedure Code (V of 1908)‑‑‑
‑‑‑‑Ss. 115 & 151‑‑‑Constitution of Pakistan (1973), Art. 185(3)‑‑‑Exercise of inherent jurisdiction by High Court‑ under S.151, C.P.C. in condoning the delay in filing revision and accepting the statement of facts for nonappearance in Court‑‑‑Supreme Court declined interference in the discretionary relief granted by High Court, for Supreme :Court interfered under Art. 185(3) of the Constitution where grave injustice had been caused‑‑‑Principles.
In the present case High Court had exercised its inherent jurisdiction in condoning the delay and accepted statement of facts for not appearing in Court. Therefore, Supreme Court was not bound to interfere in the discretionary 'relief because Supreme Court was not exercising jurisdiction of Appellate Court. However, interference is made under Article 185(3) of the Constitution of Islamic Republic of Pakistan by Supreme Court where grave injustice has been caused.
Jamshed Ahmad v. Muhammad Akram Khan and another 1975 SCMR 149 ref.
Malik Amjad Pervaiz, Advocate Supreme Court, and C.M. Lateef, Advocate‑on‑Record for Petitioner.
Pervaiz I. Mir, Advocate Supreme Court and Tanvir Ahmad, Advocate‑on‑Record for Respondents.
Date of hearing: 10th April, 2000.
ORDER
IFTIKHAR MUHAMMAD CHAUDHARY, J.‑‑In the instant petition leave has been prayed to file appeal against order dated July 1, 1999 passed by Lahore High Court whereby Civil Revision No.3319 of 1994 was re‑admitted while accepting C.M. No.735 of 1996 filed by respondents.
Briefly stating facts for disposal of instant petition are that Civil Revision referred to hereinabove was dismissed for non‑prosecution on May 29, 1995 by the Lahore High Court, Lahore. Civil Miscellaneous Application number of which, too; has been mentioned hereinabove was filed on November 16, 1996 for recalling/setting aside the order of dismissal of revision petition for its restoration and decision on merits. Title of application reveals that relief was claimed by invoking provisions of Order IX, Rule 9 read with section 151, C.P.C. The application was contested by the petitioner inter alia on the ground that request to recall/set aside the order of dismissing revision petition has been filed beyond the period of limitation and no explanation of each day has been offered. In addition to it, sufficient grounds have also not been disclosed for seeking indulgence of the Court.
Learned Single Judge vide impugned order accepted the application and restored the revision. Concluding para. from the order reads as under:‑‑
"I have heard the learned counsel for the parties. This C.M. 735 of 1996 for the restoration of the main revision petition was filed after a lapse of one and a half years and the requirement of law is that the delay of each day be explained. The petitioners poor litigants had suffered due to the negligence of their counsel, had they been informed about the date of hearing of the revision, they would have arranged their representation in the Court on that date. Although the petition did not contain the sufficient grounds for the condonation of delay of the application, but the propriety demands that the revision petition be decided on merits. The revision petition if restored subject to the payment of cost will suffice to meet the ends of justice. Taking the view that the Court should adjudicate on merits, than to oust the litigant on mere technicality, and that too for their no fault. This C.M. is accepted and the revision petition is restored to its original number subject, to the payment of cost of Rs.6,000 (six thousand) to, the respondent before the final hearing of the revision petition".
Mr. Malik Amjad Pervez, Advocate strenuously argued that petition was barred by time as according to him Article 169 of Limitation Act has prescribed 30 days for restoration of revision petition. He was also of the opinion that delay. in ‑filing of the application has also not been explained with cogent reasons, therefore, indulgence was not warranted by the High Court. His further argument was that the reasons shown' in the application for not approaching the Court promptly because of getting no information from the counsel itself is no ground to restore the revision and in the case where an Advocate has been found negligent in discharging his duties and a litigant can sue him in tort as has been‑held in Mirza Muhammad Saeed v. Sahab‑ud‑Din and 8 others PLD 1983 SC 385.
At the very outset it may be observed that dismissal of a civil revision after its admission by the Court seized with it for non‑prosecution is not legally well‑recognized for the reason that jurisdiction of a revisional Court under section 115, C.P.C. is invoked by an aggrieved person to point out illegalities or irregularities or the jurisdictional defects in the proceedings and the orders passed by the subordinate forums. Therefore, on entertaining a revision petition, Court exercises its supervisory jurisdiction to satisfy itself as to whether jurisdiction has begin exercised properly and whether proceedings of the subordinate Courts do suffer or not from any illegality or irregularity. In other words, after filing a revision, matter rests between the revisional and subordinate Courts. To substantiate this argument reference may be made to Naoomal Tourmal v. Tarachand Sobharaj and another AIR I 1933 Sindh 200. Thus is advised that the Court after having entertained a civil revision instead of dismissing it in default, may make efforts to dispose it of in accordance with the parameters laid down by section 115, C.P.C.
There is no doubt that civil revision under section 115, C.P.C. entertained by the High Court has to be disposed of in view of provisions of section 117, C.P.C. A thorough survey of C.P.C. will indicate that there is no provision for recalling/setting aside the order dismissing a revision for non‑prosecution. It may be noted that there are many other proceedings under C.P.C. in respect of which no procedure has been laid down if the same is dismissed for non‑prosecution.. Reference in this behalf may be made to the cases of (i) Bharat Chandra Nath and another v. Lasin Sarkar (Calcutta Weekly Notes) Vol. XXI 1916‑17 page 769, (ii) Sourendra Nath Mitter v. Jatindra Nath Ghose (Calcutta Weekly Notes) Vol. 32, page 811 and (iii) Syed Qasim Shah v. Deputy Commissioner, Kachhi District and another PLD 1976 Quetta 42. But a litigant suffering from such difficulty cannot be left without any remedy because law favours adjudication of matters on merits unless there exists some insurperable practical obstacle as held by this Court in the case of Wali and others v. Manak and others PLD 1965 SC 651. Therefore, to overcome such situation inherent jurisdiction of the Court can be invoked which has been conferred upon trial, appellate and revisional Courts in terms of section 151, C.P.C. However, subject to the condition that no other specific provision to deal with the issue is available under C.P.C. Reference. may be made to the case of Mrs. Mehr Sultan Jung v. Qurban Hussain 1972 SCMR 73.
As it has been observed hereinabove that there is no specific provision in Civil Procedure Code to restore a revision dismissed for non‑prosecution, therefore, an aggrieved party can claim relief under section 151, C.P.C. In this regard reference may be made to House Building Finance Corporation v. Mrs. Sarwar Jehan PLD 1992 Karachi 329.
In continuation of above conclusion it is to be observed that for filing of an application to invoke inherent jurisdiction of Court no limitation has been prescribed under a particular Article of Limitation Act. Therefore the application so filed shall be governed by residuary provision i.e. Article 181 of Limitation Act, according to which application for which no period of limitation is provided elsewhere in the Schedule or section 48 of Code of Civil Procedure, prescribed time limit shall be three years when the right to sue accrues.
Because in the case in hand application dated November 16, 1996 was not competent under Order IX, Rule 9,. C.P.C., therefore, learned High Court had to treat it as an application under section 151, C.P.C. As the same was filed within the prescribed period of three years, therefore, it was not obligatory upon the respondents to have explained the delay of each day.
Above question can also be looked from another angle namely the learned High' Court has exercised its inherent jurisdiction in condoning the delay and accepted statement of facts on behalf of respondents for not appearing in Court. Therefore, this Court is not bound to interfere in the discretionary relief because this Court is not exercising jurisdiction of Appellate Court. However, interference is made under Article 185(3) of the Constitution of Islamic Republic of Pakistan by this Supreme Court where grave injustice has been caused. Reference in this behalf may be made to Jamshed Ahmad v. Muhammad Akram Khan and another 1975 SCMR 149.
The judgment cited by the learned counsel is inapt for the foregoing reasons, therefore, need not to be discussed in detail. Nor his argument that Article 169 of the Limitation Act will govern such cases is acceptable.
Thus, above discussion persuades us to dismiss the petition as it has no merits. However, before parting with the judgment we would like to leave a note that learned High Court may make efforts to dispose of the revision petition pending before it from 1994 expeditiously. Leave to appeal is refused.
M.B.A./M‑53/S Petition dismissed.
P L D 2000 Supreme Court 825
Present: Ch. Muhammad Arif and Rana Bhagwan Das, JJ
Messrs VULCAN COMPANY (PVT.) LTD., LAHORE through Managing Director
versus
COLLECTOR OF. CUSTOMS, KARACHI and 3 others‑‑‑Respondents
Civil Petition for Leave to Appeal No.47‑L of 2000, decided on 12th April, 2000.
(On appeal from the judgment dated 1‑12‑1999/6‑12‑1999 of Lahore High Court, Lahore passed in Writ Petition No. 1734 of 1973).
(a) Sea Customs Act (VIII of 1878)‑
‑‑‑Ss.167(8)(b), 19 & 39‑‑‑Imports. and Exports (Control) Act (XXXIX of 1950), S.3(1)‑‑‑Import of goods in contravention of S.19, Sea Customs Act, 1878 read with S.3(1), Imports and Exports (Control) Act, 1950 was punishable in terms of S.167(8)(b) of Sea Customs Act, 1878‑‑‑Collector of Customs after notice to the importer tinder S.167(8)(b), Sea Customs Act, 1878, found that importer had evaded sales tax amounting to Rs.44,270.88 on the import and a penalty of Rs.60,000 was imposed on the importer‑‑Contention of the importer was that since in terms of S.39. Sea Customs Act, 1878, recovery of customs duties and other charges was hit by limitation of three years prescribed in S.30 of the Act, no penalty could have beer imposed for non‑payment of the principal amount‑‑‑Validity‑‑‑Provision of S.39, Sea Customs Act, 1878 was confined to the customs duty and other charges and not to the imposition of fine under 5:167, Sea Customs Act 1878.
Quid Cap House v. Collector of Customs 1983 CLC 1736 and Federation of Pakistan and others v. Ibrahim Textile Mills Ltd. 1992 SCMR 1898 distinguished.
Raunaq Ali v. Chief Settlement Commissioner PLD 1973 SC 236; Muhammad Baran v. Member (Settlement and Rehabilitation), Board or Revenue PLD 1991 SC 691; Engineer‑in‑Chief Branch v. Jalaluddin PLD 1992 SC 207; Manager, Jammu and Kashmir State Property in Pakistan v. Khuda Yar PLD 1975 SC 678 and Allah Ditta v. Barkat Ali 1992 SCMR 1974 ref.
(b) Administration of justice‑‑
‑‑Courts are not expected to act in aid of injustice to perpetuate the illegalities or put a premium on ill‑gotten gains.
Dr. Sohail Akhtar, Advocate Supreme Court and Ejaz Ahmad Khan, Advocate‑on‑Record for Petitioner.
Khan Muhammad Virk, Advocate Supreme Court and Mehmudul Islam, Advocate‑on‑Record for Respondents.
Date of hearing: 12th April, 2000.
JUDGMENT
RANA BHAGWAN DAS, J.‑‑‑Short question for consideration in this petition for leave to appeal is, "whether the respondents‑Custom Authorities were lawfully authorised" to impose penalty on the petitioner-importer in exercise of their powers under item 8(b) of section 167 of the Sea Customs Act, 1878 (hereinafter referred to as Act 1878) in the given circumstances.
An import licence was issued for import of three air‑conditioners of the value of Rs.29,000 in favour of Sir Ganga Ram Hospital; Lahore way back in 1965. Before such import could be had, on account of pressing circumstances; Hospital management obtained three air‑conditioners from the petitioner‑company and handed over the import licence to it with the permission .of the Import Control Authorities. Petitioner accordingly imported 26 window type air‑conditioners and two compressors in the name of the Hospital being within the outer limit of the value of the import licence. Customs Authorities released the goods without collection of custom duty, sales tax and other charges under the misconception that these were improted for Hospital purpose and were exempt from levy of taxes and, charges in view of SRO 997(K) dated 4th of August, 1960. However, on realizing the departmental oversight for non‑levy of custom duty and other charges, on or about 3rd September, 1970, Collector Customs issued a notice to the petitioner informing it that by importing 26 air‑conditioners of different capacities and two compressors instead of importing three air conditioners of 7‑1/2, 5 and 3 tons capacity respectively, contravention of the provisions of section 19 of Act, 1878 read with section 3(1) of Imports and Exports, (Control) 'Act, 1950 (hereinafter referred to as Act 1950) had been committed and thus the petitioner was punishable in terms of item 8(b) of section 167 of the Act 1878 read with abovesaid provision of Act, 1950. After such notice to the petitioner, Collector of Customs held that the petitioner had evaded sales tax amounting to Rs.44,270.88 on the aforesaid assignment by hood‑winking the authorities. Accordingly, he imposed penalty of Rs.60,000 on the petitioner which was unsuccessfully assailed by the company in appeal and revision before the customs hierarchy and ultimately impugned the aforesaid orders before the Lahore High Court in a writ petition which came to be dismissed leading to the instant petition for leave to appeal.
Main thrust of the learned counsel for the petitioner was that in terms .of section 39 of Act, 1878 since the recovery of custom duties and other charges was hit by limitation of three years prescribed in the abovesaid provision, no penalty could have been imposed for non‑payment of the principal amount. This contention was also raised before the High Court and was adequately repelled for valid reasons. We approve and uphold the view taken by the learned Judge.
We have examined the provisions contained in section 39 of Act, 1878 which essentially regulate the payment of duty short paid or erroneously refunded. True, that subsection (2) of this provision of law lays an embargo on the Authority of the Customs Authorities to make any demand for payment of customs duty or charges within a period of three years from the date of first assessment. Suffice it to say, the goods imported by the petitioner were not all assessed to any kind of duty by the Customs Authorities. Since the Authorities did not levy any customs duty nor passed an order for recovery of other charges including the sales tax, the question of issuance of show‑cause notice and subsequently demand is rendered irrelevant and out of place. In fact owing to the act of the petitioner in importing as many as 26 air‑conditioners and 2 compressors on the import licence for import of 3 air‑conditioners of larger capacity Customs Authorities imposed .a penalty of Rs.60,000 in term of item 8(b) of section 167 of Act, 1878. This provision of law empowers the Customs Authorities under Chapter XI of Act 1878 to impose penalty not exceeding five times the value of the goods in addition to confiscation of any goods, the importation and exportation of which is for the time being prohibited or restricted under Act, 1878. It is not the case of the petitioner whether the penalty imposed on it is higher than five times the value of the goods. Learned counsel strenuously urged that since the Authorities/respondents could not collect customs duty and other charges after the expiry of three years of the clearance of goods, action of imposition of penalty was equally bad in law and without jurisdiction. The argument is untenable and fallacious on the face of it as section 39 of Act, 1878 falls within Chapter V relating to levy of and exemption from customs duties whereas item 8(b) of section 167 falls in Chapter XVI which exclusively deals with the offences committed under Act, 1878 and the penalties which can be levied under the provisions of the said Act. Both the provisions are different, distinct and independent of each other and have no nexus so far the action under the provisions of Act, 1878. is concerned. Both provisions cannot be intermingled as seriously contended by the learned counsel. Reliance was placed on the cases reported as Qaid Cap House v. Collector of Customs 1983 CLC 1736 a Division Bench case from the High Court of Sindh, and Federation of Pakistan etc. v. Ibrahim Textile Mills Ltd. 1992 SCMR 1898. In both the cases provisions of section 32(3) of Customs Act, 1969 were considered and it was held that recovery of duty short‑levied would become unenforceable if notice is not served within six months as required by section 32(3). There can be no cavil with the proposition laid down in the reported cases but these are hardly attracted in the circumstances of the present case. .
Contention of the learned counsel is that equities lean in favour of the petitioner, in that, the company had imported the goods 'within outer limit of the import licence; that the company had helped Sir Ganga Ram Hospital by providing three air‑conditioners of the required capacity at the time of earnest need and that the imposition of penalty after the lapse of more than five years of the import of the goods was completely illegal.
We are afraid, we cannot subscribe to this view of the learned counsel inasmuch as the company was duly compensated by the surrender of import licence issued in favour of Sir Ganga Ram Hospital which position was apparently exploited by importing as many as 26 air‑conditioners and two compressors, instead of three air‑conditioners, without the payment of any duty and other charges and thereby obtained windfall financial gain. Indeed the petitioner cannot ‑be permitted to put ' a premium on its irregular act in contravention of the provisions of Act, 1878. Law on the subject is well‑settled as reported in Raunaq Ali v. Chief Settlement Commissioner PLD 1973 SC 236, Muhammad Baran v. Member (Settlement and Rehabilitation), Board of ‑Revenue PLD 1991 SC 691, Engineer‑in‑Chief Branch v. Jalaluddin PLD 1992 SC 207, Manager, Jammu and Kashmir State Property in Pakistan v. Khuda Yar PLD 1975 SC 678 and Allah Ditta v. Barkat Ali 1992 SCMR 1974. Argument of the learned counsel if allowed to prevail would lead to hyper‑technicalities and render the superior Courts as an instrument of oppression. There is no gain reiterating that superior Courts are not expected to act in aid of injustice and to perpetuate the illegalities or put a premium on ill‑gotten gains.
For the aforesaid facts and reasons we are in no manner of doubt that the view taken by learned Judge in Chambers of the Lahore High Court is unexceptionable. Leave to appeal is, therefore, refused and the petition is dismissed.
M.B.A./V‑1/S Petition dismissed.
P L D 2000 Supreme Court 829
Present: Rashid Aziz Khan and Iftikhar Muhammad Chaudhary, JJ
SARDAR NABEEL WALI‑‑‑Petitioner
versus
THE ADDITIONAL DISTRICT JUDGE/APPELLATE
AUTHORITY, SAHIWAL and others‑‑‑Respondents, Civil Petitions for Leave to Appeal Nos.390‑L to 397‑L of 2000, decides) on 29th March, 2000.
(On appeal from the judgment dated 22‑12‑1999 of Lahore High Court, Multan Bench passed in W.Ps. Nos.943 to 946 of 1994 and 5035 to 5038 of 1993).
(a) West Pakistan Urban Rent Restriction Ordinance (VI of 1959)‑‑
‑‑‑‑S. 13‑‑‑Bona fide personal need of landlord‑‑‑Burden of proof‑‑Principles‑‑‑No absolute rule that in every case landlord must appear in person in support of his claim for personal need‑‑‑Exception could always be there when on account of some unavoidable circumstances it was not possible for the landlord to enter in the witness‑box to support his plea but in some of the cases non‑appearance of the landlord may affect his case adversely‑‑Instance.
Once the landlord had duly acquitted himself by stating on oath that his requirement is in good faith as understood in law, he should normally be deemed to have discharged his burden, which, thereupon shifts to the tenant to whom it remains initially, to cross‑examine the landlord and, that being done, lead his own evidence in rebuttal.
As far as the requirement of rented property for personal bona fide use was concerned, it is ought to be proved as a fact through cogent, convincing and trustworthy evidence. Mere a desire of the landlord that he intended to occupy a particular premises, may be residential or nonresidential or rented land, itself would not be sufficient to accept his claim unless the requirement/need was proved as matter of a fact and the Controller enjoyed full authority to issue directions to the tenants to deliver the possession to the landlord to his satisfaction on the basis of evidence available on record.
Nothwithstanding the fact that there is a safeguard available to a tenant in terms of section 13(4) of the Ordinance, prima facie the initial burden of proof of bona fides is on the landlord.
No absolute rule has been laid down that in every case landlord must appear in person in support of his claim because exceptions could always be there when on account of some unavoidable circumstances, it was not possible for the landlord to enter in the witness‑box to support his plea, In some of the cases non‑appearance of the landlord may affect his case adversely particularly when on one hand landlord in eviction application admitted that the rented land subject‑matter of the proceedings was surrounded by agricultural land owned by him and on the other hand his contention was that he intended to establish high standard nursery on the rented land in order to increase his income, therefore, in view of such circumstances he was in a better position to explain as to why he was not occupying the agricultural land instead of dispossessing the tenants who raised construction to run their commercial business. The attorney of the landlord had admitted that he was not selling the agricultural land owned by him, therefore, it he would have appeared in the witness‑box he would have offered an explanation that what were the circumstances under which he was selling his property. Thus for these reasons it was all the more necessary for the landlord to have appeared personally in the witness‑box.
There could be legitimate causes and reasons for a suitor to cause for non‑appearance in Court meaning thereby that some reason was required to be offered by the landlord as to why he himself was abstaining from appearing in Court, therefore, in the present case the landlord failed to offer any explanation as to why he did not opt to appear in support of his claim because if he himself had entered into witness‑box he would have given better explanation to substantiate his bona fides in occupying the rented land the subject‑matter of the instant proceedings.
The landlord had failed to state on oath about his good faith to occupy the rented land i.e. the subject‑matter of the proceedings and as per requirement of law he failed to establish that except the disputed rented land he could not establish a high standard nursery on the agricultural land which was already in his possession. Thirdly, the tenants had no opportunity to cross‑examine the landlord as to why he was not establishing the nursery on the agricultural land which was situated adjacent to the disputed land and for what reason he was selling his agricultural land instead of establishing his business to increase his income.
Initial burden was on landlord to prove his personal bona fide need for establishing high standard nursery but he had failed to discharge the burden.
Syed Abdul Rauf v. Abdul Sattar 1998 SCMR 2525; 1972 SCMR 437; 1998 SCMR 2119 and United Bank Limited v. Mrs. Alafia Hussain 1999 SCMR 1796 distinguished.
Dr. A.R. Khan v. Muhammad Ishaque 1973 SCMR 437 and S.M. Nooruddin and 9 others v. Saga Printers 1998 SCMR 2119 ref.
(b) West Pakistan Urban Rent Restriction Ordinance (VI of 1959)‑‑
‑‑‑‑S. 13‑‑‑Bona fide personal need of landlord‑‑‑Principle to ascertain such bona fides.
Once the landlord had duly acquitted himself by stating on oath that his requirement is in good faith as understood in law, he should normally be deemed to have discharged his burden, which, thereupon shifts to the tenant to whom it remains initially, to cross‑examine the landlord and, that being done, lead his own evidence in rebuttal.
S.M. Nooruddin and 9 others v. Saga Printers 1998 SCMR 2119 ref.
(c) West Pakistan Urban Rent Restriction Ordinance (VI of 1959)‑‑
‑‑‑‑S. 13‑‑‑Bona fide .personal need of landlord‑‑Requirements for landlord ,to prove his need‑‑‑Principles.
As far as the requirement of rented property for personal bona fide need was concerned, it is ought to be proved as a fact through cogent, convincing and trustworthy evidence. Mere a desire of the landlord that he intended to occupy a particular premises, may be residential or nonresidential or rented land, itself would not be sufficient to accept his claim unless the requirement/need was proved as a matter of fact and the Controller enjoyed full authority to issue directions to the tenants to deliver the possession to the landlord to his satisfaction on the basis of evidence available on record.
(d) West Pakistan Urban Rent Restriction Ordinance (VI of 1959)‑‑
‑‑‑‑S. 13‑‑‑Expressions "good faith" and "bona fide" ‑‑‑Interpretation.
Mushtaq Ahmad v. Mrs. Mumtaz Zohra Rizvi PLD 1978 Kar. 188 quoted.
(e) West Pakistan Urban Rent Restriction Ordinance (VI of 1959)‑‑
‑‑‑‑S. 13‑‑‑Bona fide personal need of landlord or his child‑‑‑Burden of proof‑‑‑Notwithstanding the fact that there is a safeguard available to a tenant in terms of S.13(4), West Pakistan Urban Rent Restriction Ordinance, 1959, initial burden of proof of bona fides is on the landlord.
Notwithstanding the fact that there is a safeguard available to a tenant in terms of section 13(4) of the Ordinance, prima facie the initial burden of proof of bona fides is on the landlord.
The provisions of subsection (4) of section 13 of the Ordinance have been enacted in favour of a tenant to restore him the possession, if a landlord has failed to prove by his subsequent action that his bona fide requirement as alleged in the ejectment proceedings, has not come true. These provisions do not relieve the landlord of the basic onus on him to prove affirmatively that he does need the premises for his bona fide requirement or for that of his male child.
Ch. Muhammad Yaqub Sidhu, Advocate Supreme Court and Syed Abul Aasim Jafri, Advocate‑on‑Record (absent) for Petitioner.
Nemo for Respondents.
ORDER
IFTIKHAR MUHAMMAD CHAUDHARY, J.‑‑By this common order we have proposed to dispose of C.P.L.As.Nos.390‑L/2000 to 397‑L/2000 as in all these matters common impugned order passed by Lahore High Court, Multan Bench dated 22nd December, 1999 has been assailed.
Succinctly facts of the case as stated are that petitioner instituted separate eviction applications under section 13 of the Punjab Urban Rent Restriction Ordinance VI of 1959 (hereinafter referred to as the 'Ordinance') against private respondent, seeking their eviction from the rented land possessed by them on which they have constructed at their own cost buildings to run their business, for his personal bona fide use and occupation as in good faith he intends to establish a high standard Nursery to increase means of his income. It may be noted that in the applications it was stated that disputed rented land is surrounded by the agricultural property owned by the petitioner.
Eviction applications were contested by the private respondents and learned Controller accepted his request against three tenants whose cases are covered by C.P.L.As. Nos.390‑L, 392‑L and 393‑L/2000 vide judgment dated 14th December, 1993 whereas eviction applications .against the remaining tenants were rejected vide orders dated 28th February, 1993 respectively. Accordingly the tenants against whom Controller passed adverse orders preferred appeals which came up for hearing before Additional District Judge, Sahiwal. Simultaneously, petitioner also preferred appeals against the orders in which directions we're not made by the Controller to the tenants for handing over the possession. All the matters came up for hearing before the Appellate Court who granted relief to the tenants against whom the orders of Rent Controller and was operating as their appeals were accepted vide order dated 7th June, 1994. Similarly appeals submitted by the petitioner against the order of Controller rejecting his eviction applications were decided against him ‑as all the eviction applications filed by petitioner were rejected ultimately. Therefore, he preferred Writ Petitions before Lahore High Court Multan Bench which have been dismissed vide impugned order.
Learned counsel contended that petitioner has been non‑suited principally on two counts:
(i) Petitioner did not appear in person to support his claim;
(ii) petitioner has failed to establish bona fide to establish high standard nursery on the rented land, the subject‑matter of the proceedings because he had agricultural land surrounding the rented land, therefore, if he desires he can establish the nursery on that land instead of dispossessing the respondents from their business.
"6. The issue on the question of default in payment of rent by the appellant was decided against the respondent, therefore, we need not dilate upon it and the only question for consideration in this appeal is that fact of non‑appearance of the respondent in the witness‑box and having got himself examined through an attorney. We have considered the above question in the light of the case‑law cited by the learned counsel for the appellant. We are of the view that every case is to be decided keeping in view its peculiar facts and circumstances and no hard and fast rule can be laid down. There can be legitimate causes and reasons for a suitor to cause for nonappearance in Court. Mental or physical disability as well as the case of a female would stand on a different footing. The Courts are meant for the citizens from where they seek justice and, therefore, to put a clog or non‑suit them on account of non‑appearance even in genuine cases without any valid and cogent reasons would be a dangerous proposition for administering justice with even hands, between the parties. In our opinion, it will not be in the interest of justice to lay down that in every case where a party does not appear or arranges his appearance through attorney, an adverse inference should be drawn against him. Such a rule if laid down, would result into great hardship in cases where the parties, for instance, reside abroad, who will have to sue and defend themselves through their attorney.
Perusal of the criteria discussed in the above paras. would indicate that no absolute‑ rule has been laid down in the reported judgment that in every case landlord must appear in person in support of his claim because exceptions could always be, there when on account of come unavoidable circumstances, it is not possible for the landlord to enter in the witness‑box to support his plea. We may mention here that in some of the cases nonappearance of the landlord may affect his case adversely particularly as in the instant cases on one hand petitioner in eviction application admits that the rented land subject‑matter of the proceedings is surrounded by agricultural land owned by him and on the other hand his contention is that he intends to establish high standard nursery on the rented land in order to increase his income, therefore, in view of such circumstances he was in a better position to explain as to why he is not occupying the agricultural land instead of dispossessing the tenants who have raised construction to run their commercial business. It is also important to note that the attorney of the petitioner had admitted that petitioner is also selling the agricultural land owned by him, therefore, if he would have appeared in the witness‑box .he would have offered an explanation that what are the circumstances under which he is selling his property. Thus for these reasons in our opinion it was all the more necessary for the petitioner to have appeared personally in the witness‑box. Be that as it may, learned Judge in Chambers of High Court has not non‑suited the petitioner merely for this reason that he did not appear in the witness‑box except making passerby remarks that the petitioner did not appear personally to state on oath that he needed the premises for his personal bona fide need. Simultaneously, the statement of the counsel for the petitioner that it is no requirement of law that he ought to have appeared in person and the statement of his attorney provided sufficient standard of proof in this regard and after making these observations the Court opined that when he does not come forward to make a statement and has no genuine ground to offer for abstaining from the cross‑examination, the evidence in substitution cannot be treated at par. At this stage reference once again may be made to the judgment which has been relied upon by the counsel for petitioner in this behalf. There too, it was observed that there can be legitimate causes and reasons for a suitor to cause for non‑appearance in Court meaning thereby that some reason is required to be offered by the landlord as to why he himself is abstaining from appearing in Court, therefore, we are inclined to hold that in the instant case the petitioner failed to offer any explanation as to why he did not opt to appear in support of his claim because we are of the opinion as it has been observed hereinabove that if he himself had entered into witness‑box he would have given better explanation to substantiate his bona fides in occupying the rented land the subject‑matter of the instant proceedings.
"Once the landlord had duly acquitted himself by stating on oath that his requirement is in good faith as understood in law, he, should normally be deemed to have discharged his burden, which, thereupon shifts to the tenant to whom it remains initially, to crossexamine the landlord and, that being done, lead his own evidence in rebuttal. "
Applying the above test on the facts of instant cases first of all, without any reservations, we have to hold that the landlord has failed to state on oath about his good faithness to occupy the rented land i.e. the subjectmatter of the proceedings and as per requirement of law he failed to establish that , except the disputed rented land he cannot establish a high standard D nursery on the agricultural land which is already in his possession. Thirdly, the respondents had no opportunity to cross‑examine the petitioner as to why he is not establishing the nursery on the agricultural land which is situated, adjacent to the disputed land and for what reason he is selling his agricultural land instead of establishing his business to increase his income. It may be noted that as far as the requirement of rented land for personal bona fide is concerned, it is ought to be proved as a fact through cogent, convincing and trustworthy evidence. Mere a desire of the landlord that he intends to occupy a particular premises, may be residential or non‑residential or rented land, itself would not be sufficient to accept his claim unless the requirement/need is proved as a matter of fact and the Controller enjoys full authority to issue directions to the tenants to deliver the possession to the landlord to his satisfaction on the basis of evidence available on record. In case of Mushtaq Ahmed v. Mrs. Mumtaz Zohra Rizvi PLD 1978 Karachi 188 words 'good faith and bona fide' were interpreted elaborately. For sake of benefit relevant para. is reproduced hereinlielow:‑‑
"9. Subsection (3), clause (a) of section 13 of the Ordinance lays down that a landlord may apply to the Controller for an order directing the tenant to put the landlord in possession in the case of residential building, inter alia, if he requires it in good faith for his own occupation or for the occupation of any of his children. Clause (b) of this subsection, then lays down that the Controller shall, if he is satisfied that the claim of the landlord is bona fide, make an order directing the tenant to put the landlord in possession in the building. Accordingly, the jurisdiction of the Controller to order eviction on this ground is depended on his satisfaction that the claim of the landlord is bona fide and his requirement is in 'good I faith'. The term 'good faith' has not been defined in the Ordinance r but it has been defined in section 2(27) of the West Pakistan General Clauses Act, 1956 as follows:‑‑
'A thing shall be deemed to be done in 'good faith' where it is in fact done honestly, whether it is done negligently or not.'
This definition of the expression 'good faith' necessarily, therefore, implies that the demand for possession of the rented premises must be honestly made. Honesty is a state of mind and is therefore, a psychological fact capable of proof or disproof only by evidence or conduct. The word 'bona fide in the context of the provision in question would also appear to mean the same as 'good faith'. Mala fides, conversely means 'in bad faith'. It has been held that action taken for collateral purposes not authorized by the law under which the action is taken or action taken in fraud of the land are mala fide. It is necessary, therefore, for a person alleging that an action has been taken mala fide to show that the, person responsible for taking the action has been motivated by any one of the considerations mentioned above PLD 1974 SC 151. In actual practice a landlord would be deemed to have satisfied the aforesaid conditions by leading evidence of the reasonableness of his needs and if he succeeds in doing so, the onus would shift to the tenant to prove facts which militate against the existence of good faith or which positively establish the dishonesty of purpose on the part of the landlord to claim possession of the premises on the ground of personal need. If therefore, the circumstances brought on record are capable of being consistently with an honest claim for possession to satisfy personal need, they will in no way be construed to have discharged the onus of the tenant referred to above."
As we have observed while discussing the proposition hereinabove that the Controller in the eviction application against the respondents whose cases are covered by C:P.L.As. 391‑L of 2000 and from 397‑L/2000 to 397‑L/2000 has held that there is no bona fide in the claim of the petitioner, therefore, eviction applications submitted by him were rejected. In these cases the findings were upheld by the first Appellate Court as well as learned High Court, during hearing of Writ Petitions. Although in the eviction applications which are covered by C.P.L.As.390‑L/2000, 392‑L/2000 and ;. 393‑L/2000 relief as prayed for was granted to petitioner but the finding in his favour was reversed by first Appellate Court on accepting the appeals of the tenants and the findings of the first Appellate Court were affirmed by the ' High Court. Thus in view of consistent adverse finding against the petitioner we are of the opinion that the petitioner has failed to prove his case at the . touchstone of principle laid down by this Court in the case of S.M. , Nooruddin and 9 others (supra). Therefore, this judgment as well is of no help to him. As far as judgment in the case of United Bank Limited v. Mrs:. Alafia Hussain 1999 SCMR 1796 is concerned it has also not promoted the case of the petitioner because as per, its ratio the initial burden is on petitioner to prove his personal bona fide need for establishing high standard nursery but in our opinion the petitioner has failed to discharge the burden for the reasons which have been explicitly explained above.
Learned counsel lastly contended that petitioner's bona fide can be tested by pressing into service. the provisions of section 13(4) of the Ordinance according to which a safeguard is provided to the respondent/tenant that if the petitioner failed to establish high standard nursery then in that case they would be entitled for reinduction. In our opinion this argument carries no weight because, nothwithstanding the fact that whether there is a safeguard available to a tenant in terms of section 13(4) of the Ordinance, but prima facie the initial burden of proof of bona fides is on the, landlord as it has been held in the case of Dr. A.R. Khan (supra). Relevant para. from this case is reproduced as under:
"As rightly contended by the learned counsel for the appellant, the provisions of subsection (4) of section 13 of the Ordinance have been enacted in favour of a tenant to restore him the possession, if an landlord has failed to prove by his subsequent action that his bona fide requirement as alleged in the ejectment proceedings, has j not come true. These provisions do not relieve the landlord of the basic onus on him to prove affirmatively that he does require the premises for his bona fide, requirement or that of his male child. "
In view of above discussion we are not inclined to take exception to the impugned judgment. Consequently petitions fail as such leave is refused.
M.B.A./N-10/S Petition dismissed.
P L D 2000 Supreme Court 839
Present: Khalil‑ur‑Rehman Khan and Ch. Muhammad Arif, JJ
Mst. AMEER BEGUM‑‑‑Petitioner
versus
MUHAMMAD NAEEM KHAN and another‑‑‑Respondents
Civil Petition for Leave to Appeal No.259‑L of 1997, decided on 21st July, 1998.
(On appeal from the judgment/order of Lahore High Court, Bahawalpur Bench, Bahawalpur, dated 14‑1‑1997, passed in Civil Revision No.347‑D of 1994/BWP.).
Civil Procedure Code (V of 1908)‑‑‑
‑‑‑‑S. 115‑‑‑Constitution of Pakistan (1973), Art. 185(3)‑‑‑Revision‑‑Disputed question of fact‑‑‑Finding of lower Courts at variance‑‑‑Appraisal of evidence on record in exercise of revisional jurisdiction ‑‑‑Such disputed question was dealt with in detail firstly by Lower Appellate Court and then by Revisional Court‑‑‑Contention raised by the petitioner was that the finding of fact was not a concurrent finding and the same was not liable to be reversed in revision‑‑‑Validity‑‑‑Where two Courts below differed on the issue of fact, it was open for the High Court to appraise the evidence and record his own conclusion after proper appraisal of evidence on record‑‑‑Appraisal of evidence so made did not suffer from any legal infimrity‑‑‑No justifiable exception could be taken to the conclusions recorded in the judgment of High Court‑‑‑Leave to appeal was refused.
Shaukat Ali Mehr, Advocate Supreme Court and Sh. Masood Akhtar, Advocate‑on‑Record for Petitioner.
Basit Bahar Chughtai, Advocate Supreme Court and Ch. Mehdi Khan Mehtab, Advocate‑on‑Record for Respondents.
Date of hearing: 21st July, 1998.
ORDER
KHALIL‑UR‑REHMAN KHAN, J.‑‑‑This petition is directed against the judgment dated 14‑1‑1991 of the learned Judge of the Lahore High Court, Bahawalpur Bench, Bahawalpur; whereby the Civil Revision filed by the respondents was allowed and the judgment and decree dated 6‑3‑1984 passed by the Additional District Judge, Bahawalnagar accepting the appeal and decreeing the suit for possession of land through pre‑emption was set aside and that of the Civil Judge, Bahawalnagar dated 3‑3‑1983 dismissing the suit filed by the petitioner was restored.
The sole question agitated before us was whether the suit land is an urban immovable property or not, This controversy is subject‑matter of Issue No.2. Learned trial Court returned the fording under this issue to the effect that the suit property was urban immovable property and not agricultural land. This finding was reversed by the learned Appellate Court but in revision the finding of the learned trial Court, was upheld and restored.
Admittedly, the question raised is a question of fact which was dealt with to detail firstly by the learned first Appellate Court and then by the revisional Court. The grievance of the learned counsel was that the finding of the learned Appellate Court should not have been reversed in revision. The finding of fact was not a concurrent finding that the same was not liable to be A reversed in revision ordinarily. Learned two Courts below having differed on the said issue, it was open for learned Judge of the High Court to appraise the evidence and record his own conclusion after proper appraisal of the evidence on record. This was precisely done by the .learned Judge of the High Court and by giving cogent reasons and applying the principles enunciated by this Court in decided cases he recorded the conclusion that the plot in question had assumed urban character and as such was not liable to be pr;‑empted. It was noted that the plot measuring 1 Kanal 12 Marlas had roads on three sides and a plot on the fourth side. The same was purchased for residential purposes and is situated in a rectangle which has been included in the municipal limits of town. It was since before purchase recorded as "Banjar Kham" in the revenue record and according to Exh. P.3 and Exh. P.4 the land even prior to the sale was described as "Ghair Mumkin Bhatta". It was further observed that the evidence on record accepting bald statement of P. Ws. that it was agricultural land did not warrant drawing of such a conclusion and that in the aforenoted circumstances the finding could not be reversed by observing that village Islampura was an agricultural village and that major part of the village was not included in the Municipal Committee, Bahawalnagar. Learned Judge of the High Court in the impugned judgment also examined decided cases to support his conclusions. The appraisal of the evidence so made does not suffer from any legal infirmity. No justifiable exception, therefore, can be taken to the conclusions recorded in the impugned judgment. This petition, therefore, fails.
Leave to appeal is refused and the petition is dismissed.
Q.M.H./M.A.K./A‑29/S Petition dismissed
P L D 2000 Supreme Court 841
Present: Muhammad Bashir Jehangiri, Actg. C.J., Sh. Ijaz Nisar, Abdur Rehman Khan, Sh. Riaz Ahmed and Munir A. Sheikh, JJ
THE HUB POWER COMPANY LIMITED (HUBCO)
through Chief Executive and another‑‑‑Petitioners
versus
PAKISTAN WAPDA through Chairman
and others‑‑‑Respondents
Civil Appeals Nos. 1398 and 1399 of 1999, decided on 14th June, 2000, (On appeal from the orders of High Court of Sindh, Karachi dated 11‑8‑1999 and 23‑1‑1999 respectively passed on Miscellaneous Applications in H.C.A. No.90 of 1999).
Per Sh. Riaz Ahmed, J., Sh. Ijaz Nisar and Munir A. Sheikh, JJ. agreeing‑‑[Majority view]‑‑
Contract Act (IX of 1872)‑‑
‑‑‑‑S. 23‑‑‑Illegal objects and considerations of an agreement‑‑‑Agreement was alleged to have been obtained through fraud or bribe‑‑‑Allegations of corruption were supported by circumstances which provided basis for further probe into the matter judicially, and, if proved would render the agreement as void‑‑‑Dispute between the parties was not commercial dispute arising from an undisputed legally valid contract, or relatable to such a contract, for, on account of such criminal acts disputed documents did not bring into existence any legally binding contract between the parties, therefore, dispute primarily related to the very existence of valid contract and not a dispute under such a. contract‑‑‑Such matter, according to the public policy, held, required finding about alleged criminality and was not referable to arbitration.
Per Muhammad Bashir Jehangiri, Actg. C.J; Abdur Rehman Khan, J. agreeing; Sh. Riaz Ahmed, Sh. Ijaz Nisar and Munir A. Sheikh, JJ., Contra‑‑[Minority view]‑‑
A valid contract could not become contrary to public policy because an allegation that a later amendment was the product of an illegal act.
Hub Power Co. v. WAPDA 1999 CLC 1320; Ghulam Muhammad and 3 others v. State and another 1972 PCr.LJ 1130; Harbour Assurance v. Kansa (1993) 1 Lloyd's Rep. 455; Russell on Arbitration; Hitachi v: Rupali 1998 SCMR 1618; Sezai Turkes Feyzi, Akkaya Construction Company, Lahore v. Crescent Services, Lahore and another 1997 SCMR 1928; Heyman and another v. Dawins Limited (1942) AC 356; Woolf v. Collis Removal Service (1948) 1 KB 11; Firm Karam Narain Daulat Ram and another v. Messrs Volkart Bros. and another AIR 1946 Lah. 116; Rungta Sons (Private) Limited v. Judgment Trg. Republike and another AIR 1959 Cal. 423; Port Qasim Authority v. Al‑Ghurair Ltd., Karachi PLD 1997 Kar. 636; Dhadarajamal Govindram v. Shanji Kalidas & Co. AIR 1961 SC 1285; Lahore Stock Exchange Limited v. Fredrick J. Whyte Group (Group) Pakistan and others PLD 1990 SC 48; Pakistan Burmah Shell Ltd. v. Tahir Ali 1983 CLC 2745; Karachi Shipyard and Engineering Works Ltd. v. Messrs General Iron and Steel Works Ltd. PLD 1971 Kar. 501; Soleimany v. Soleimany (1999) 3 All ER 847; DST v. Ras A1 Khaimah National Oil Co. (1987) 2 All ER 769; CBI NZ Ltd. v. Badger Chiyoda (1989) 2 NZLR 669; Manzoor Hussain v. Wali Muhammad PLD 1965 SC 425; Official Assignee of the High Court of West Pakistan and others v. Lloyd's Bank Ltd. and others PLD 1969 SC 301; Dawood Corporation Ltd. v. Jasian Jasimina and others 1988 MLD 987; Sultan Textile Mills (Karachi) Ltd. v. Muhammad Yousuf Shamsi PLD 1972 Kar. 226; M.A. Choudhury v. Mitsui PLD 1970 SC 373; Hitachi v. Rupali 1998 SCMR 1618; The Law and Practice of International Commercial Arbitration, 3rd Edn., 1999, pp.5‑33 to 5‑36; English Arbitration Act, 1996, S.30; Russell on Arbitration, 21st Edn. (1997), pp.2‑095; Harbour Assurance v. Kansa (1992) 1 Lloyd's Rep. 81; (1993) 1 Lloyd's Rep.455; Astro Vencedor Compania Naviera SA of Panama v. Mabanaft GmbH (1971) 2 All ER 1301; Ashville Investments Ltd. v. Elmer Construction Ltd. (1988) 2 All ER 577; Fazghirzadeh v. Rudolf Woolf SA (Ptv.) Ltd. (1977) 1 Lloyd's Rep. 630; A&B v. C&D (1982) 1 Lloyd's Rep. 166; The Ermoupolis (1990) 1 Lloyd's Rep. 160; Paczy v. Haendler and Natermann GmbH (1979) FSR 420; Re: Vocam Europe Ltd. (1997) (unreported); Russell on Arbitration, pp.2‑070; Westacre Investments v. Jugoimport ((1988) 4 All ER 570; Camilla Cotton Oil Co. v. Granadex S.A. (1976) 2 Lloyd's Rep. 10; Ashville Investments Ltd. v. Elmer Construction Ltd. (1988) 2 All ER 577; Mar‑Len of Louisiana v. ParsonsGillbane 773 F.2d 633 (1985‑US Court of Appeal, 5th Cirs and Island Textile Mills Ltd., Karachi v. V/O Technoexpert and another 1979 CLC 307 ref.
Abdul Hafeez Pirzada, Senior Advocate Supreme Court assisted by Rashid Haneef, Advocate, Makhdoom Ali Khan, Advocate Supreme Court, Khiras N. Kabraji, Advocate, Salman Talibuddin, Advocate, Allan Walls, Solicitor, Linklators (London), Toby Landau, Barrister‑at‑Law. Ms. Asma Nur Khan, Adovcate and Sardar Qasim Ali, Advocate for Appellant (in, C.A. ‑No. 1398 of 1999 and Respondent No. 1 in C.A. 1399 of 1999).
Fakharuddin G. Ebrahim, Senior Advocate Supreme Court, Umar Ata Bandial, Advocate Supreme Court, Ms. Ayesha Malik, Advocate Supreme Court, Adil Saleem Khan, Advocate Supreme Court and M.S. Khattak, Advocate‑on‑Record for Appellant (in C.A. No. 1399 of 1999 and for Respondent No. l in C. A. No. 1398 of 1999).
Dates of hearing: 15th, 16th, 17th, 18th, 21st, 24th, 29th February; 17th, 18th, 19th, 20th, 21st, 24th, 25th, 26th, 27th, 28th April; 8th, 9th, 10th, 11th and 15th May, 2000.
JUDGMENT
MUHAMMAD BASHIR JEHANGIRI, ACTG. C.J.‑‑The two titled appeals by leave of this Court under Article 185 of the Constitution of the Islamic Republic of Pakistan, 1973 are directed against the orders passed by a learned Judge in Chambers of the High Court of Sindh at Karachi in Suit No. 1417 of 1998 and C. M. As. Nos.. 9751, 9752, 10602, 10603 and 399 of 1998 and 8434 of 1999, decided on 26‑3‑1999.
The facts forming the background of the two titled appeals as narrated in the leave granting order are that a Power Purchase Agreement was executed on 3‑8‑1992 between the parties together with an Implementation Agreement of the even date guaranteeing due performance of the aforesaid Agreement. On the same day, a Sovereign Guarantee was also executed on behalf of the President of the Islamic Republic of Pakistan undertaking to pay the amount falling due under the aforesaid Power Purchase Agreement of the even date. The Power Purchase Agreement was supplemented and amended by the Supplemental Deed to Power Purchase Agreement dated 16‑11‑1993. On 24‑2‑1994, the Agreement was amended vide the First Amendment and again on 17‑10‑1994 the Agreement was further amended by the Second Amendment. So, three amendments were statedly made to the Power Purchase Agreement i.e. by Supplemental Deed, the First Amendment and the Second Amendment, as a result whereof the amount payable by WAPDA to the HUBCO was allegedly increased. One Aziz‑ul‑Haq Qureshi filed on 8‑5‑1998 Writ Petition No.8755 of 1998 in the Lahore High Court under "public interest litigation", inter alia, asserting that amendment No.2 to the Power Purchase Agreement being without consideration, unauthorised, illegal and fraudulent was ineffective in law.
Learned Judge of the Lahore High Court on 11‑5‑1998 passed an order in aforementioned Petition ' restraining HUBCO from repatriating the funds. On 13‑5‑1998 the Constitution Petition was referred to a larger Bench and then on 18‑5‑1998 an order directing WAPDA to pay Rs.1.50 per K.W. per hour was passed after noticing the plea that WAPDA is paying Rs.761 million per month more to HUBCO than the amount which is being paid to another concern using similar technology. The HUBCO filed a petition for leave to appeal (C.P. No.703 of 1999) against the aforenoted orders dated 11‑5‑1998 and 18‑5‑1998. This Court vide order dated 3‑7‑1998, by consent of the parties, converted this petition into appeal and disposed of the same with the observation that the order dated 5‑6‑1998 of this Court will hold the field till the time the High Court decides the question of maintainability of the above writ petition including the question of territorial jurisdiction and the merits.
HUBCO, invoking the arbitration clause contained in the Power Purchase Agreement, requested on 9‑7‑1998 to International Chamber of Commerce (hereinafter referred to as the ICC) for constituting Arbitration Tribunal for decision of the controversy raised before it. A letter dated 11‑10‑1998 of WAPDA was received by HUBCO on 12‑10‑1998 whereby HUBCO was notified that on examination of the events leading to the execution of Supplemental Deed dated 16‑I1‑1993, amendment No. l dated 24‑9‑1994 and amendment No.2 dated 17‑10‑1994 and the alleged Government's approval, it (WAPDA) has arrived at the conclusion that the said documents were illegal, fraudulent, collusive, without consideration, mala fide and designed to cause wrongful loss to WAPDA and the GOP with consequential wrongful gain to HUBCO as these documents were the result of criminal conspiracy and WAPDA, therefore, notified that said agreements were void ab inito and were of no legal effect 'with regard to the rights and obligations of the parties under Power Purchase Agreement dated 3‑8‑1992. Inter alia, on the above premises, a refund of Rs.16 billion, which was statedly overpaid, with 18 % interest was demanded. HUBCO also filed a suit on 10‑11‑1998 in the High Court of Sindh for injuncting WAPDA from giving effect to the letter dated 11‑10‑1998 and also from seeking resolution of the dispute through any other forum except by reference to ICC. In the suit, vide order dated 12‑11‑1998, ad interim injunction restraining WAPDA from acting in pursuance of the letter dated 11‑10‑1998 was granted. WAPDA also filed a suit before the Senior Civil Judge, Lahore on 16‑1‑1999 for the recovery of more than 17 billion rupees on the averments, amongst others, that the three amendments were illegal and void, fraudulent, collusive, without consideration, mala fide and designed to cause wrongful loss to WAPDA and to the GOP and consequential wrongful gain to HUBCO. A permanent injunction restraining HUBCO from pursuing plea of arbitration before ICC was also prayed. The Civil Court on the same day, on injunction application, granted ad interim injunction restraining HUBCO from proceeding with the arbitration.
Against orders passed by the learned Senior Civil . Judge, two revisions were filed in the Lahore High Court, Lahore. These revision petitions as well as the Constitution Petition filed by Azizul Haq Qureshi, referred to in the earlier part of this order, are pending before the Lahore High Court, Lahore.
As against the letter dated 11‑10‑1998 of the WAPDA, HUBCO on 13‑11‑1998 issued a notice alleging fundamental breach of the contractual obligations on account of paying Rs.730 million as against Rs.845 millions thus, reducing the payment to the extent of Rs.115 millions per month. HUBCO on 12‑1‑1999 also invoked the letters of credit of the value of Rs.4 billion given by Consortium of Banks on behalf of WAPDA in reply dated 15‑1‑1999 stated that letters of credit were not liable to be encashed as the whole dispute was pending adjudication before the High Court of Sindh at Karachi.
Various applications which were moved before the High Court of Sindh may now be noticed. Those miscellaneous applications were filed in the suit and the learned Single Judge vide order dated 22‑1‑1999 while adjourning the matter till 4‑2‑1999 ordered the parties to ignore the injunction granted by the Senior Civil Judge, Lahore vide order dated 16‑1‑1999 restraining the parties from proceeding with the arbitration. WAPDA filed Appeal (H.C.A. No. 26 of 1999) against the order dated 22‑1‑1999 and the Division Bench of the High Court of Sindh on 27‑1‑1999 called for the record of the suit and fixed the hearing on 23‑2‑1999 with the consent of all the parties. The High Court Appeal No.26 of 1999 was disposed of on 20‑2‑1999 by consent order with the direction that the parties would not take any step to proceed with the matter i.e. ICC Case No.10045/OLG which is pending before ICC Arbitral Tribunal, Paris up to 28‑3‑1999. Meanwhile, learned Single Judge was requested to dispose of Civil Miscellaneous Application on merits by 18‑3‑1999. It may be noted that on a revision filed by HUBCO in the Lahore High Court against the order dated 20‑2‑1999 passed by the learned Senior Civil Judge, ad interim order dated 12‑3‑1999 was obtained restraining HUBCO from proceedings with the arbitration case. Learned Judge of the High Court of Sindh dismissed HUBCO's Miscellaneous Applications Nos.9751 and 10602 of 1999 as well as C.M.A. No.9752 as having become infructuous but at the same time granted the relief in relation to C.M.A. No.399 of 1999. This led to the filing of H.C.A. No.90 of 1999 in the High Court of Sindh. In appeal against the orders passed in the C.M.As. were filed and vide order dated 26‑3‑1999 matter was adjourned to 20‑4‑1999 for hearing of the appeal as well as C.M.A. No.415 of 1999 and till then impugned order. was suspended and respondent HUBCO was restrained from taking any steps in arbitration proceedings before the ICC at London. On 20‑4‑1999, learned counsel for HUBCO submitted an undertaking to the effect that HUBCO will not seek to have the arbitration fixed for hearing up to a certain date. This undertaking was extended from time to time uptil 7‑6‑1999 and as HUBCO was not inclined to extend its period further, order dated 26‑3‑1999 was revived by the Division Bench till next date of hearing vide order. dated 3‑6‑1999. Ultimately, vide order dated 11‑8‑1999, learned Judges of the Division Bench observing that after decision of the said C.M.A. i.e. C.M.A. No.975 of 1999 nothing would be left to be decided in appeal itself directed that the entire arguments on appeal as well as on the said C.M.A. would be heard together for their disposal and the matter was adjourned to 31‑8‑1999 for the said purpose. Interim‑order passed earlier was ordered to continue till then. HUBCO filed C.P.L.A. No. 1426 of 1999 against the aforesaid order dated 11‑8‑1999 of the Division Bench passed in the Miscellaneous Application. WAPDA, on the other hand, filed C.M.A. No.1425 of 1999 seeking suspension of operation of certain PTNs issued by HUBCO and direction to restrain HUBCO from acting upon the PTNs pending the decision of the application and C.M.A. No.1426 of 1999 for initiating contempt proceedings against HUBCO. These applications were also not heard and were kept pending as it was brought to the notice of the Division Bench of the High Court of Sindh that HUBCO had filed a petition for leave to appeal before this Court against the order dated 11‑8‑1999 earlier passed on the application of HUBCO. This order was then assailed by WAPDA by' filing C.P.L.A. No. 1460 of 1999.
Before proceeding to consider the contentions of the learned counsel for the parties, it would be worthwhile to give some more facts on the agreement, the arbitration clause and then the core dispute. .
As indicated earlier the basic project agreements comprise the Implementation Agreement, the Fuel Supply Agreement and the Power Purchase Agreement.
Implementation Agreement:
It is not disputed that this agreement was executed by HUBCO with the GOP on 3‑8‑1992 and governs HUBCO's relationship with the GOP. It is stated that under this agreement, HUBCO is responsible for developing, designing, financing, insuring, constructing, owning, operating and maintaining the Plant and, for "appointing an operating and maintenance contractor acceptable to the GOP". This agreement is said to be designed to limit the impact of Pakistan‑related risk on the project. The Government has, inter alia, it is further submitted, undertaken to guarantee the obligations of WAPDA and PSO and of the State Bank of Pakistan in relation to the provision of foreign exchange insurance cover for HUBCO's foreign currency financing costs.
Fuel Supply Agreement:
This agreement was entered into between HUBCO and PSO on 3‑8‑1992. Under the Fuel Supply Agreement HUBCO purchases all its requirement for RFO from PSO. PSO's performance of its obligations under the Fuel Supply Agreement are guaranteed by the GOP pursuant to a guarantee furnished under the Implementation Agreement.
Power Purchase Agreement: '
Electricity generated from the Plant by the HUBCO is sold to WAPDA pursuant to the Power Project Agreement (PPA). This agreement was executed between HUBCO and. WAPDA. on 3‑8‑1992 and was subsequently amended by a Supplemental Deed dated 16‑11‑1993, further amended by an agreement dated 24‑2‑1994 (the "First Amendment"); further amended by an Agreement dated 17‑9‑1994 (the "Second Amendment") and; further amended by a Supplemental Deed dated 5‑3‑1997. Under the PPA, WAPDA has the right to instruct HUBCO to generate and deliver electricity into the WAPDA Grid and is obliged to pay HUBCO for the capacity made available and the electric energy delivered in accordance with a tariff formula agreed between WAPDA and HUBCO under the PPA. It is also a common ground between the parties that the proper law of the PPA is the law of England. According to HUBCO, "the tariff payable by WAPDA under the PPA is not a number but a mathematical formula the result of which is affected by the amount of electricity demanded by WAPDA and the quality and price of the RFO supplied by PSO". It is further the claim of the HUBCO that "the formula is subject to adjustment every six months in order to account for Rupee devaluation and every 12 months in order to account for inflation". It is further averred that "keeping in view the 76% of the project cost which is debt financed, HUBCO's tariff contains two components‑‑a fixed component ("CPP") and a variable component ("EPP") and that the variable costs include the fuel price, exchange rates, inflation and the plant utilisation. The fixed components and the variable component (CPP) and (EPP) have also been enumerated in the memorandum of appeal.
Arbitration Clause:
Clause 15 of the PPA contains the arbitration agreement which reads as under:
15.1 Government Law:
The rights and obligations of the parties wider or pursuant to this Agreement shall be governed and construed according to the laws of England.
15.2 Disputes Procedure:
If any dispute or difference of any kind whatsoever (the "Dispute") shall arise between WAPDA "the respondent's and the Company in connection with or arising out of this Agreement, the parties shall attempt to settle such dispute in the first instances within forty‑five (45) days by, discussions between the Company and WAPDA.
15.4 Arbitration:
(a) If the dispute cannot be settled within forty‑five (45) days by discussions and referral to an expert is not required by this Agreement, or if referral to an expert was required but the dispute was referred for arbitration in the circumstances set out in section 15.3(g) then the dispute shall be finally settled under the provisions of sections 15.4 to 15.7.
(b) If and when GOP has implemented the convention on the Settlement of Investment Disputes between States and National of other States (the "Convention") any dispute arising out of or in connection with agreement shall (regardless of the nature of the dispute but without prejudice to the provisions of this Agreement requiring any matter to be referred to an expert for final determination) be referred to arbitration and finally settled in accordance with‑ the Convention and the Rules of Procedure for Arbitration Proceedings of the International Centre for Settlement of Investment disputes (the "Centre") established by the Convention (the "ICSID Rules") and the parties hereby consent to arbitration thereunder. The parties are agreed. that Company shall be deemed to be a foreign controlled company for the purposes of Article 25(2)(b) of the Convention so long as not less than thirty per cent. (30%) of the shares of the Company are held by Foreign Investors. Arbitration proceedings conducted pursuant to this section 15.4(b) shall be held in London, England.
(c) Unless and until GOP has implemented the Convention by an Act or an Ordinance confirmed by an Act, or if, for any other reasons the dispute cannot be finally settled pursuant to the terms of the Convention, .any dispute shall be finally settled by arbitration in London, England under the rules of Arbitration of the International Chamber of Commerce (the "ICC Rules") by one or more arbitrators assented in accordance with the ICC Rules.
(d) No arbitrator appointed pursuant to section 15.4(b), section 15.4 (c) or section 15.4(d) shall be a national of the jurisdiction of either party to this Agreement or of the jurisdiction of any of the Initial shareholders nor shall any such arbitrator be an employee or agent or former employee or agent of any such person.
(e) The language of any arbitration under section 15.4(b) section 15.4(c) or section 15.4(d) shall be English.
It has been urged on behalf of HUBCO that the PPA has been performed for about more than two years and has given rise to vested rights in favour of HUBCO. It is, however, maintained that WAPDA purely on extraneous considerations and in a most malicious manner, launched a campaign calculated to coerce HUBCO to re‑write the PPA in such manner as the Government desires in order to revise the tariff payable by WAPDA for the electricity purchased by WAPDA from HUBCO. It is further maintained that WAPDA's campaign continues unabated despite the fact that HUBCO has made every effort to explain to the GOP that its demands are unreasonable. The WAPDA was charged by HUBCO with mala fides and attempts to intimidate, threaten and harass ,HUBCO, its. directors, officers, employees and direct contractors by various means and steps enumerated in para. V.6 at pp.27, 28, 29, 30 and 31 of HUBCO's Memorandum of Appeal which need not be reiterated for the sake of brevity.
According to the averments made in Civil Appeal No. 1399 of 1999 filed by WAPDA, the impugned order passed by the learned Division Bench of the High Court of Sindh, Karachi, in C.M.A. No. 1425 of 1999 was not sustainable in law.
On the contrary, WAPDA had averred that the underlined dispute between the WAPDA and HUBCO is about the validity of amendments made on 16‑11‑1993, 27‑2‑1994 and 17‑10‑1994 which have been described as "(Tainted Amendments)" to the PPA dated 3‑8‑1992 entered into between WAPDA and HUBCO. WAPDA, according to the memorandum of appeal, disowned the "Tainted Amendments" as being fraudulent, _ without consideration and void, by its letter dated 11‑10‑1998. (Termination letter) which, inter alia, stated as follows:‑‑
"1. WAPDA on examination of the events leading to the execution of:
(a) Supplemental Deed dated 16‑11‑1993:.
(b) Amendment No. l dated 24‑2‑1994:
(c) Amendment No.2 dated 17‑9‑1994:
(d) And their alleged Government‑ approvals, their implementation and their effects, have arrived at the conclusion that the said documents are illegal, fraudulent, collusive, without consideration, mala fide and designed to cause wrongful loss to WAPDA and the Government of Pakistan with consequential wrongful gain to HUBCO. These documents are in fact result of a criminal conspiracy as borne out by First Information Report No.5998 registered on 3‑11‑1998.
"2. WAPDA, therefore, hereby notifies that the said agreements are void ab initio and are of,. no legal effect with regard to the rights and obligations of the parties under Power Purchase Agreement, dated August 3rd, 1992."
"3. The losses occasioned to WAPDA by such wrongful acts are in excess of Rs.16 billion. HUBCO is hereby called upon to forthwith refund the said sum of Rs.16 billion for the present with interest thereon at 18 % per annum. "
C.M.A. No. 9751 of 1998.
"It is respectfully prayed on behalf of the plaintiff that for reasons amongst others, mentioned in the accompanying affidavit this Hon'ble Court may be pleased to issue a temporary injunction restraining the defendants jointly and/or severally from directly or indirectly through their agents, servants, subordinates, directors or officers from giving effect to WAPDA's letter dated, ll‑10‑1998 or from taking any steps in furtherance of or in connection therewith and to suspend the operation thereof."
"Ad interim orders in the same terms are also prayed for. "
C.M.A. No. 9752 of 1998.
"It is respectfully prayed on behalf of the plaintiff that for reasons, amongst others, mentioned in the accompanying affidavit . this Hon'ble Court may be pleased to issue a temporary injunction restraining the defendants jointly and severally from directly or indirectly through their agents, servants, subordinates, directors or officers from invoking the jurisdiction of any Court or Tribunal or administrative forum or instituting any judicial, 'quasi judicial or administrative action in Pakistan , in connection‑ with, or in furtherance of or in aid of, WAPDA's letter dated 11‑10‑1998."
"Ad interim orders in the same terms are also prayed for."
"It is respectfully prayed on behalf of the plaintiff for reasons, amongst others, mentioned in the accompanying affidavit, that this Hon'ble Court may be pleased to issue a temporary injunction restraining the defendant No.l from proceeding further in the (as yet) unnumbered suit of 1999 instituted on 16‑1‑1999 by WAPDA in the Court of the Senior Civil Judge, Lahore and, in particular. "
"From the prosecuting and or furthering prosecution of the said suit including any and all interlocutory application made therein: and or
From seeking any extension to the ad interim ex parte orders obtained and passed on 16‑1‑1998 on the said interlocutory applications made by WAP17A before the learned Senior Civil Judge, Lahore under Order 39, Rules 1 and 2 read with section 151, C. P. C. and section 33, Arbitration Act, 1940 and under Order 39, Rules 1 and 2 read with section 151, C.P.C. on 23‑1‑1999 when the abovesaid applications are fixed for hearing in the Court of the Senior Civil Judge, Lahore."
"In the interest of justice, equity and judicial propriety and interim orders in the same terms are also prayed for. "
provisionally restrained HUBCO from taking further steps in the ICC arbitration at London. HUBCO also filed its cross‑appeal against the impugned order of the learned Single Judge of the High Court of Sindh. Both the appeals one by WAPDA and another by HUBCO were directed to be heard together. .
It is the case of WAPDA that the core issue that emerged is whether the Tainted Amendments are valid or not. The claim of WAPDA that ultimately emerged is that having renounced the Tainted Amendments which form the basis of the claim of HUBCO, highly inflated demand for payment are void and ineffective on the ground of fraud and corruption which are against the concept‑ of public policy under the provisions of the Contract Act (No. IX of 1872).
Both the learned counsel formulated as many as ten questions which according to them arise for determination in the two titled Appeals filed by each one of the parties. At the time of commencement of hearing of the appeals, the learned counsel appearing on behalf of the parties, however, abandoned all other propositions raised except the following:‑‑
(3) Whether the nature of the dispute and the questions of mala fide, fraud illegalities and the legal incompetence raised preclude resolution of the matter through arbitration as a matter of public policy and as such the dispute between the parties is not arbitrable and cannot legitimately be subject‑matter of the ICC arbitration? What is the effect of joining a stranger to the Agreement in making reference to the Arbitration.
(i) HUBCO has wrongly argued that the original Schedule 6 to the PPA, dated 3‑8‑1992 was not an agreed document. The original Schedule 6 was a binding document and integral part of the PPA (section 17.5 of the PPA). To calculate the tariff payable to HUBCO, a Reference Financial Model (RFM) was, however, to be agreed within 3 months of the PPA under paragraph 10.1 of original Schedule 6 to the PPA.
(ii) Side letter, dated 3‑8‑1992 repeats the provisions of Schedule 6 to the original PPA. The letter attempts to set a timetable for agreeing to the RFM within the agreed time limit of 90 days. Nowhere does the letter indicate and agreement to delete the original Schedule 6 or to replace it with a new/revised Schedule 6.
(iii) WAPDA letter, dated 16‑6‑1993 complains that the simplified version of proposed RFM forwarded by WAPDA should be used as an agreed starting point for negotiation, whereas HUBCO had sent yet another version of the computer model of over 8 MB size, which could not even be loaded on WAPDA computers. The subject matter of the letter is only' the provision of the R'FM and not 'replacement' or 'deletion' of the original contemplated in the original Schedule 6 of the PPA, dated 3‑8‑1992 and not to delete or replace original Schedule 6.
(iv) HUBCO letter, dated 28‑6‑1993 proposes to amend the original Schedule 6 to exclude indexation provisions from the RFM. There is nowhere any suggestion to replace the original Schedule 6 or the RFM as a means for developing a Reference Tariff contemplated by the opening paragraph of Part 1 of Section A of the original Schedule 6 to the PPA. In response to this letter, the Private Power Cell. of the Ministry of Water and Power, Government of Pakistan asks for a computer model to operate original Schedule .6 over the life of the project. There is no mention that RFM is to be contemplated in the original Schedule 6 of the PPA, dated 3‑8‑1992 and not to delete or replace original Schedule 6.
(v) HUBCO letter, dated 28‑6‑1993 proposes to amend the original Schedule 6 to exclude in indexation provisions from the RFM. There is nowhere any suggestion to replace the original Schedule 6 or the RFM as a ‑ means for developing a Reference Tariff contemplated by the opening paragraph of Part 1 of Section A of the original Schedule 6 to the PPA. In response to this letter, at p.78, Private Power Cell of the Ministry of Water and Power Government of Pakistan asks for a computer model to operate original Schedule 6 over the life of the project. There is no mention that RFM is to be abandoned for developing Reference Tariff or to replace the original Schedule 6.
(vi) HUBCO letter, dated 7‑3‑1993 explains that Lenders require new Indexation formulae to be built into the original Schedule 6. The RFM as contemplated in the original Schedule 6 was to perform two functions firstly, to develop the Reference Tariff and secondly to cater for indexation. In the letter, there is no intention that Reference Tariff will be developed without the RFM, as the subject‑matter presently in controversy.
(vii) WAPDA letter, dated 19‑8‑1993 complains that HUBCO has not provided the RFM and Schedule 6. Clearly, the R'FM is still needed to develop the Reference Tariff.
(viii) HUBCO letter, dated 24‑8‑1993 spells out clearly that changes to original Schedule 6 are confined to Indexation provisions. Nowhere the RFM is being done away for developing the Reference Tariff. WAPDA's grievance is the fraudulent establishment of Reference Tariff without the RFM as expressly required by the original Schedule 6.
(ix) HUBCO letter, dated 12-10‑1993 to Mr. Salman Farooqi under the heading ‑ PPA Indexation, states proposed changes are mainly editorial .and remaining are mathematical. Nowhere the deletion of RFM for the purposes of developing the Reference Tariff is mentioned.
(x) In the HUBCO's letter, dated 14‑10‑1993 forwarding the principle papers on Revised Schedule 6 speaks of Indexation mechanism under the Schedule 6, there is no mention that RFM, Expert provisions, or Original Schedule 6 is to be deleted.
(xi) World Bank letter, dated 18‑10‑1993 specifically discusses Schedule 6. It states that only indices have to be negotiated by WAPDA and HUBCO. The letter does not indicate that parties will abandon RFM to develop the Reference Tariff or replace Original Schedule 6.
(xii) World Bank letter dated 30‑10‑1993 to Mr. Salman Farooqi, is crucial because the position about Original Schedule 6 is ‑made transparent. The‑ letter clearly states that the concern of the Lenders is only with the Indexation provisions of Schedule 6, which have yet 'to be agreed. That means the rest or original Schedule 6 is acceptable to the lenders and not liable to change. This includes the RFM meant for establishing the Reference Tariff (Please note that cove of letter is marked to Mr. Shahid Hassan Khan who was then Adviser to Prime Minister).
(xiii)MD (WPPO) letter, dated 3'‑11‑1993 issued from Islamabad on International Resource Group (IRG Consultants) format expressly notes that "the financial Model has not yet been negotiated and agreed". This clearly shows that the only issue before the GOP. WAPDA, Lenders, World Bank and HUBCO is the Indexation mechanism applicable to Reference Tariff after it is determined through the RFM under paragraph 10.1 of Original Schedule 6. WAPDA's genuine grievance is, therefore, amendments without the agreed mechanism i.e. RFM.
(xiv) HUBCO's letters, dated 3‑11‑1993 and 5‑11‑1993 asking MD (WPPO) Malik Muhammad Ashraf (an accused in the F.I.R. No.59 of 1998) to put his initial on New Schedule 6 although it is noted in HUBCO's own letter that Mr. Ashraf was incompetent to do so.
It would, however, be noticed that the above points raised for our consideration squarely cover the factual controversy surrounding the Amendments brought about in Schedule VI ‑by virtue of Amendment No.2 and .if the proposition on which the leave had been granted is decided in favour of HUBCO, then WAPDA would have a chance to raise these questions before the Arbitral Tribunal. We are, therefore, of the considered view that the adjudication thereof at this juncture would prejudice the case of either party before us and is; therefore, deferred for determination after these appeals are decided.
Mr. Abdul ‑Hafeez Pirzada, learned Senior Advocate Supreme Court, submitted that at the heart of WAPDA's objections lies a key misconception that the dispute between the W APDA and HUBCO raises issues of criminal law and public policy. For instance (1) questions of the grave public and national importance; (2) issues of corruption in high public offices in procuring Amendment No.2 particularly the Amendment of Schedule VI; (3) matter of public law and public policy; (4) a purely legal issue involving a very special. criminal law of Pakistan; and (5) criminal matters. A curious aspect of WAPDA's criminal proceedings was also referred to by the learned counsel for HUBCO that WAPDA's criminal proceedings have been filed in the Sindh Banking Court particularly when there was no banking aspect to this case and that approaching the Banking Court was with a view to putting maximum pressure on HUBCO for the reasons that conditions for bail in that Court are especially stringent. It was, thus, contended that WAPDA's, approach to the criminal proceedings run counter to the rule that criminal proceedings may not be used as a commercial weapon. Reliance was placed on Ghulam Muhammad and 3 others v. State and another (1972 PCr.LJ 1130).
Reverting to the issue of 'Public Policy", it was urged that the public policy in the sense used by WAPDA referred to fundamental issues of morality and legality. Obviously, according to HUBCO, it was completely different from "economic" or "government" policy.
The learned counsel for HUBCO emphasized that if the public policy element was relevant in the cases then it favoured arbitration. According to him arbitration is a recognised exception to the rule set out in section 28 of the (Pakistan's) Contract Act (IX of 1872).
Mr. Abdul Hafeez Pirzada, learned Senior Advocate Supreme Court, then urged that an essential in international commercial arbitration is the Arbitral Tribunal's power and duty to examine its own jurisdiction that as a matter of law, it is not the case that a jurisdictional protest automatically brings an arbitration to an abrupt halt, inasmuch as it is the duty of an arbitral tribunal to consider its own jurisdiction because any award on jurisdiction is open to review by the Courts of the seat and the Court where enforcement is sought.
As to the scope of the agreement, Mr. Abdul Hafeez Pirzada, invoked the provisions of clause 15 of PPA which contained a detailed regime for the resolution of "Disputes" by arbitration. The relevant part of Clause 15.4 provides as follows:‑‑
"Arbitration:
(c) ..any dispute shall be finally settled by arbitration in London, England under the Rules of Arbitration of the International Chamber of Commerce (the "ICC Rules") by one or more arbitrators appointed in accordance with the ICC Rules. "
"Governing law:
The rights and obligations of the parties under or pursuant to this Agreement shall be governed and construed according to the laws of England.
In this context, it was added that WAPDA did not question the validity of this arbitration agreement: on the contrary, it is common ground that it was freely entered into, and is entirely valid as an agreement. The learned counsel for HUBCO repelled the contentions of the learned counsel for the WAPDA that the parties' arbitration clause was of limited scope, inasmuch as that it applied only to "the meaning and interpretation of the agreement between the parties; its effect and its alleged breach by one mother of the parties". According to him, it is the GOP's case, that the word "dispute" in clause 15 has to be read as "Business Dispute" although the term .is defined in the PPA itself vide Clause 15.2. The interpretation and scope of the arbitration agreement in Clause 15 of the PPA is a matter for the governing law of that agreement (known as the "proper" "law of this contract).
The learned counsel for HUBCO emphasized that arbitration agreement in PPA was drafted in extremely wide terms and referred to clause 15.2 which defined "disputes" as:‑
"...any dispute or difference of any kind whatsoever.."
Again Clause 15.4(b) refers to:‑
"...any dispute arising out of or in connection with this Agreement."
Again Clause 15.2(c) refers to:‑‑
"...any dispute."
In the opinion of the learned counsel for HUBCO those specific words which are commonly used in arbitration clauses have been the subject of judicial interpretation. According to him, as a matter of English law, this arbitration clause is extremely broad in its cope and covered disputes well beyond the limited range suggested by WAPDA.
Ultimately, Mr. Abdul Hafeez Pirzada, learned Senior Advocate Supreme Court, then invoked the provisions of Clause 17.12 of the PPA and urged that other sections of the PPA expressly contemplated that issues of fraud and corruption may be referred to arbitration. It would, therefore, be appropriate to reproduce Clause 17.12 of the P.P.A. which provide as follows:‑‑
"The Company declares and affirms that it and (so far as the Company is aware) the Initial Shareholders and the Company's director and employees have not paid nor undertaken to pay any unlawful commission, bribe, pay offs, kick‑backs and that it has not in any other way or manner paid any sums, whether in Rupees or foreign currency and whether in Pakistan or abroad, or in any other manner given or offered to give any gifts and presents in Pakistan or abroad to any person or to engage in any of the said or similar acts during the term of this Agreement."
From this clause, it has been rightly emphasized that there was no doubt that any dispute arising out of or in connection with this clause will be within the ambit of the arbitration provisions in Clause 15. The learned counsel also conceded that ultimately there was nothing in Clause 17.12 to oust the jurisdiction of the Pakistan Courts `in respect of the matter with which it deals.
We would now revert to WAPDA's contention that provision of Clause 17.12 supports its submission that the parties contemplated that issues of fraud and corruption were referable only to the Pakistani Courts. It has also been contended on behalf of WAPDA that... the affirmation clause ... expressly provided that (allegations of corrupt practices) would be dealt with by the Courts of Pakistan. This clause in fact excludes the jurisdiction of the arbitrators to examine allegations of corruption, fraud etc.
A bare reading of Clause 17.12 would, however, reveal that it does not at all "expressly" provide that the allegation of fraud and corruption could be dealt with by the Courts of Pakistan. In fact it makes no mention of the Pakistan Courts whatsoever: In essence Clause 17.12 sets up contractual protection in addition to the usual public and criminal recourse. Under English and Pakistan laws, Arbitration Clauses contained in contracts are treated as separate and self‑contained contracts in that if it were riot so, arbitration clauses would not at all survive and attack on the main contract which is known as the doctrine of "separability". It may be noted that since WAPDA accepts the validity of the arbitration agreement and the unamended PPA, no issue of "separability" actually arises in this case. In Harbour Assurance v. Kansa (1993) 1 Lloyd's Rep. 455) the Court of Appeal has held that an arbitration clause will survive where the main contract in which it appears is invalid ab intio on grounds of illegality so that the illegality issues themselves can properly be referred to arbitration. This common law rule has now been enshrined in section 7 of the English Arbitration Act, 1996. Further Article 6(4) of the ICC Rules specifically provides as follows:‑‑
"Unless otherwise agreed, the Arbitral Tribunal shall not cease to have jurisdiction by reason of any claim that the contract is null and void or allegation that it is non‑existent provided that the Arbitral Tribunal upholds the .validity of the arbitration agreement. The Arbitral Tribunal shall continue to have jurisdiction to determine the respective rights of the parties and to adjudicate their claims and pleas even though the contract itself may be non‑existent or null and void".
"The doctrine of separability greatly increases the scope of all arbitration clauses. The doctrine of separability establishes that an arbitration agreement has a separate life from the contract for which it provides the means of resolving disputes. This enables the arbitration agreement to survive breach of the contract of which it is a clause. The validity of the main contract can then be determined by using the arbitration clause. Earlier case‑law showed that the public policy requirement that a contract which is void should not be enforced was superseded by the overriding need to give effect to the parties' wishes to have their disputes resolved by arbitration. The parties were presumed to have wanted their disputes resolved by one tribunal, arbitration, and, in the light of that presumption of 'one‑stop adjudication', the Court strove to give effect to the arbitration agreement and to allow the arbitration tribunal to investigate whether the contract ever existed. "
In Hitachi v. Rupali (PLD 1998 SCMR 1618 at 1658) it was held that while the law of an arbitration agreement usually followed the proper law of the main contract, an arbitration agreement was separable from the main contract between the parties and arbitration agreement may have a different law which may be provided within the arbitration agreement.
In Sezai Turkes Feyzi Akkaya Construction Company, Lahore v. Crescent Services, Lahore and another (1997 SCMR 1928 at page 1933) cases were relied upon where despite "frustration" or "repudiation" of the contract the arbitration clause was said to survive and apply. An arbitration clause was even held to survive if the parties entered into a new arrangement which in fact modified or novated the terms of the parent contract. Reference was made to Heyman and another v. Dawins Limited (1942) AC 356), Woolf v. Collis Removal Service (1948) 1 KB 11, Firm Karam Narian Daulat Ram and another v. Messrs Volkart Bros. and another (AIR 1946 Lah. 116) and Rungta Sons (Private) Limited v. Judgment Trg. Republike and another (AIR 1959 Cal. 423).
In the case of Port Qasim Authority v. Al‑Ghurair Ltd., Karachi (PLD 1997 Kar. 636, at pages 643 and 644) (relying on an Indian Supreme Court case Dhadarajamal Govindram v. Shanji Kalidas & Co. AIR 1961 SC 1285) it was ruled that where the very existence of the legally binding contract had been challenged, the phrase "dispute in respect of or concerning anything herein contained" was broad enough to give jurisdiction to arbitrators to decide the validity of the contract. The issue whether the terms of the agreement were at the relevant time legally enforceable, was held to be an arbitrable issue.
In the precedent of Lahore Stock Exchange Limited v. Fredrick, J. Whyte Group (Group) Pakistan and others (PLD 1990 SC 48) the validity of the contract was questioned. It was alleged that the contract was void ab initio as the person who had signed the contract was not legally authorised to sign the same. It was submitted that this was an issue that had to be decided by the Court and not by the arbitrator. The Court rejected this argument and held that the phrase "any dispute in respect of interpretation of the agreement or concerning anything contained therein" was of the "widest amplitude and content" ‑ wide enough to include the submission of invalidity or contract as well as the incompetence to sign the same and were matters that could be decided by the arbitrator.
In a judgment reported as Pakistan Burmah Shell Ltd. v. Tahir Ali (1983 CLC 2745 at page 2752) it was held that once it was established that a contract existed, then even though the contract may have come to an end by reasons of "frustration of rescission or breach of condition or by being avoided for fraud or misrepresentation or coercion" the arbitration clause would survive.
Lastly in Karachi Shipyard and Engineering Works Ltd. v. Messrs General Iron and Steel Works Ltd. (PLD 1971 Kar. 501 at pages 503 and 504) wherein the arbitration clause was worded in wide and broad terms that "in the event of any dispute arising on any matter connected with this Agreement..." it was held that notwithstanding the alleged modification or novation of the contract, the arbitration clause being severable from the main contract, survived.
"(i) The exception to separability that the Court of Appeal identified‑which, as the Court acknowledged, is a very narrow exception‑concerns contracts for illegal adventures, which are illegal or tainted in their very purpose. The example which the Court gave was of a contract of cooperation between the Highwaymen. Other examples would be a contract for slavery; for drug trafficking or for the sale of alcohol in Pakistan. These are illegal activities, and, therefore, no arbitration of such an activity can be recognized. An arbitration clause contained in such a contract would be taken as one part of an overall illegal arrangement."
The instant case is very far from this: the arrangement here is the provision of electricity to WAPDA. This PPA is a valid and entirely legal contract, and the arbitration agreement contained in it is certainly not contrary to public policy. A subsequent amendment which it is alleged was procured by fraud cannot, on any analysis, taint the PPA itself (which WAPDA acknowledges is a valid contract).
In short, it is totally unclear how a valid contract can itself become contrary to public policy because of an allegation that a later amendment was the product of an illegal act.
Again the following observations in Hitachi's case (supra) at .page 1657 (para. 10) were relied upon:‑‑
"...the proper law of the arbitration agreement governs the validity of the arbitration agreement, which will include: whether a dispute is covered by the arbitration agreement..."
"...An issue as to whether a particular dispute falls within the wording of an arbitration clause will, therefore, be governed by the proper law of the arbitration agreement."
"Consideration of public policy can never be exhaustively defined, but they should be approached with extreme caution. As Burrough Judge remarked in Richardson v. Mellish (1824) 2 Bing 229 at 252: ' It is never argued at all but when other points fail'."
"The law reports contain ample warnings to Judges to be cautious before striking down contracts in the name of public policy."
(1) Manzoor Hussain v. Wali Muhammad (1965 SC 425 at pp. 427, 433 and 434), (2) Official Assignee of the High Court of West Pakistan and others v Lloyds Bank Ltd. and others (PLD 1969 SC 301), (3) Dawood Corporation Ltd. v. Jasian Jasimina and others (1988, MLD 987, at pp. 994 and 995), (4) Sultan Textile Mills (Karachi) Ltd. v. Muhammad Yousuf Shamsi (PLD 1972 Kar. 226 at pp. 235 and 236).
The submissions of the learned counsel for HUBCO get strengthened with reference to dictum in M.A. Chaudhry v. Mitsui (PLD 1970 SC 373) and Hitachi v. Rupali (1998 SCMR 1618).
In support of this statement of law reference was made to: Eg Redfern and Unter's "The Law and Practice of International Commercial Arbitration" (3rd Edn., 1999) at pp. 5‑33 to 5‑36), wherein it was also pointed out that if doctrine of separability or severability did not exit, any recalcitrant party could instantly bring arbitration proceedings to a firm stop by simply raising an allegation of corruption, bribery and fraud. Apart from reference to Article 6(2) of the ICC Rules; section 30 of the English Arbitration Act, 1996, our attention was drawn to the case of Hitachi v. Rupali (1998 SCMR 1618) and Port Qasim Authority v. Al‑Ghurair Ltd., Karachi (PLD 1997 Kar. 636) and in this context Russel on Arbitration 21st Edn. (1997) at pp.2‑095 was referred which reads as under:‑‑
"The law of the arbitration agreement regulates substantive matters relating to that agreement, including in particular the interpretation, validity, voidability and discharge of the agreement to arbitrate, and similar issues relating to the reference and enforcement of the award. An issue as to whether a particular dispute falls within the wording of an arbitration clause will, therefore, be governed by the proper law of the arbitration agreement."
In support of this proposition reliance is placed on the following case‑law:‑‑
(i) Harbour Assurance v. Kansa (1992) 1 Lloyd's Rep. 81 (Steyn, J.) (1993 1 Lloyd's Rep. 455 (Court of Appeal): the phrase 'all disputes or differences' covered an allegation that there was no underlying agreement at all, the contract being void ab initio on grounds of illegality. Steyn Judge, at first instance, also stated that supervening illegality would also be within the clause.
(ii) Astro Vencedor Compania Naviera SA of Panama v. Mabanaft GmbH (1971) 2 All ER 1301 (Mocatta, J.)‑‑affirmed by Court of Appeal, ibid at 1307: an "any dispute" arbitration clause in a charter party covered a tortuous claim for wrongful arrest of the vessel by the chatterers‑even though the tort claim was unlike any contractual claim.
(iii) Ashville Investments Ltd. v. Elmer Construction Ltd. (1988) 2 All ER 577 (Court of Appeal): A claim for misrepresentation fell within an arbitration clause providing for arbitration disputes arising "thereunder or in connection with" the contract. The words "in connection with" plainly pointed to matters arising during the formation of the contract.
(iv) Fazghirzadeh v. Rudolf Woolf SA (Pty) Ltd. (1977) 1 Lloyd's Rep. 630: The words "arising out of" were held to cover a dispute as to the possible substitution of afresh contract.
(v) A & B v. C & D (1982) 1 Lloyd's Rep. 166 (Mustill, Judge): An arbitration clause with similar words as Clause 15 was held wide enough to encompass claim arising out of a separate (but related) contract which contained no arbitration clause
(vi) The Ermoupolis (1990) 1 Lloyd's Rep. 160 (Steyn, Judge): An arbitration clause in a bill of lading referring to "any dispute arising in any way whatsoever out of this bill of lading" covered a claim in tort for conversion.
(vii) Paczy v. Haendler and Natermann GmbH (1979) FSR 420: An equitable obligation on an employee not to misuse confidential information was the subject of a dispute "arising out of or in connection with" the contract of employment.
(viii) Re Vocam Europe Ltd. (1997) ‑ unreported (Rimer, Judge): An arbitration clause in an agreement between the shareholders of a company was wide enough to encompass statutory claims by minority shareholders for relief against unfair prejudice that would ordinarily be made in Court under section 459 of the English Companies Act, 1985. "
" 'Fraud can be within the scope of an arbitration agreement. There is no doubt at all that fraud falls squarely within the formulation in Clause 15 of the PPA, and there are many examples where cases have been stayed in favour of arbitration notwithstanding that fraud and corruption have been alleged."
Westacre Investments v. Jugoimport ((1988) 4 All ER 570, at .594‑596 (Cloman Judge ‑ affirmed by Court of Appeal): Allegations of bribery of Kuwaiti Government officials held to be within the scope of a standard ICC arbitration clause:‑‑
"There can be no doubt that as a matter of language the arbitration clause in the consultancy agreement was expressed in terms wide enough to cover the issue whether the agreement was illegal and valid by reason of a common or unilateral intention to bribe Kuwaiti officials."
Camilla Cotton Oil Co. v. Granadex S.A. (1976) 2 Lloyd's Rep. 10 (House of Lords).
(Ashville Investment Ltd. v. Elmer Construction Ltd. (1988) 2 All ER 577 (Court of Appeal).
See in particular: Mar‑Len of Louisiana v. Parsons‑Gilbane 773 F.2d 633 (1985 ‑ US Court of Appeals, 5th Cir): Amendments to a contract alleged to have induced by fraud; Held: within the scope of the arbitration agreement. "
"Island Textile Mills Ltd:, Karachi v. V/O Technoexpert and another 1979 CLC 307 at pages 309‑A, 310‑B and C and 315‑L. An arbitration clause provided that the 'parties shall take all measures to settle amicably all disputes and differences which may arise out of this contract or in connection with it...' made it clear that the intention was to exclude the jurisdiction of the Court. It was held that there was no legal prohibition or embargo to the effect that an arbitration tribunal cannot try the question of fraud and/or misrepresentation. "
"There are three laws which may be relevant in an international arbitration, namely (i) proper law of the arbitration agreement; (ii) curial law; and (iii) proper law of reference. The proper law of the arbitration agreement governs "the validity of the arbitration agreement; the question whether, a dispute lies within the scope of the arbitration agreement; the validity of the notice of arbitration; the constitution of the Tribunal; the question whether an award lies within the jurisdiction of the arbitrator; the formal validity of the award, the question whether the parties have been discharged from any obligation to arbitrate future disputes. Whereas the curial law governs the manner in which the reference is to be conducted; the procedural powers and duties of the arbitrator; question of evidence; the determination of the proper law of the contract. The proper law of the reference governs the question whether the parties have been discharged from their obligation to continue with the reference of the individual dispute."
"However, the validity of the arbitration agreement; the question whether a dispute lies within the scope of the arbitration agreement; the validity of the notice of arbitration; the constitution of the Tribunal; the question whether the award lies within the jurisdiction of the arbitrator; the formal validity of the award; the question whether the parties have been discharged from any obligation to arbitrate future disputes, are not the matters covered by curial law, but are governed by the proper law of the arbitration agreements."
The ultimate analysis, therefore, is that Civil Appeal No. 1399 of 1999 filed by WAPDA against HUBCO is declared to have been rendered infructuous at the moment.
Civil Appeal No. 1398 of 1999 filed by Hub Power Company Limited against WAPDA is accepted and the impugned order; dated 11‑8‑1999 of the learned Division Bench of the High Court of Sindh, Karachi, in C.M.A. No.975 of 1999 arising from H.C.A. No.90 of 1999 and lift and recall the injunction preventing from proceeding with arbitration in ICC Arbitration Case No. 10045/OLG.
Before parting with this judgment, let us make it clear that I notwithstanding the fact that proper law of arbitration agreement governs the validity of the arbitration agreement in this case, the award favourable to one party or another shall obviously be brought to Pakistan for execution and it would be then challengeable if any one of the parties, So, chooses as to its; validity on any ground whatsoever permissible under any Pakistani Law.
In view of the complicated nature of the case, parties are left to bear their own costs.
(Sd.)
MUHAMMAD BASHIR JEHANGIRI, ACTG. C.J.
I agree with the learned Actg. C.J.
(Sd. )
ABDUR REHMAN KHAN, J.
SH. RIAZ AHMED, J.‑‑‑I have gone through the judgment handed down by my learned brother Muhammad Bashir Jehangiri, Actg. C.J. in which the facts have been elaborately given and discussed and; therefore, they need not be repeated. The only question which this Court is required to answer by agreement of both the parties is noted down in the leave granting order which is to the following effect:‑‑
"Whether the nature of the dispute and the question of mala fide, fraud, illegalities and the legal incompetence raised preclude resolution of the matter through arbitration as a matter of public policy and as such the dispute between the parties is not arbitrable and cannot legitimately be subject‑matter of ICC arbitration? What is the effect of the joining a stranger to the agreement in making reference to the arbitration."
Case of the WAPDA at the very outset was that supplemental deed 16‑11‑1993, the first amendment, dated 24‑2‑1994 and the second amendment, dated 17‑10‑1994 were obtained by HUBCO in collusion with the concerned authorities of WAPDA and the high officials of the Federal Government who were in a position to exert influence on the WAPDA Authorities through the payment of bribe and kick‑backs as such it was void under section 23 of the Contract Act and not, voidable simpliciter. The main question falling for determination according to our view, was that if an agreement prima facie had been obtained through fraud or bribe would it not then be sufficient to take it out of the pale of the arbitrability as distinguished from a commercial dispute raised under a valid agreement, therefore, we have heard learned counsel for the parties as to whether there was prima facie material and circumstance brought on the record in support of these allegations, as mere allegations were not sufficient in order to come to the conclusion, whether the dispute between the parties is arbitrable or not.
Since these circumstances have been dealt with by our learned brother Muhammad Bashir Jehangiri, Actg. C.J. in his proposed judgment, we need not repeat the same but the following salient features and circumstances noted by us have persuaded us to hold that these prima facie furnish evidence in support of the allegations made in respect of the disputed documents that the dispute is not arbitrable as such should be decided by a Court of law as a matter of public policy:
(a) In the original agreement cost of Plant was 1275 Million Dollars which HUBCO wanted to raise and was in fact subsequently raised. The documents produced on the record by both the parties show that WAPDA had throughout been contesting the case of HUBCO to raise the said costs of construction but the same was raised to more than 1500 Million Dollar which prima facie gave one‑sided benefit to HUBCO as CPP was also raised, as a consequence thereof it was payable on the amount of cost of construction on the Plant.
(b) The debt and equity ratio as fixed in the original agreement was 80 % and 20 % respectively which was changed and was converted to 75 % and 25 % respectively which allegedly burdened the WAPDA and gave undue advantage to HUBCO, for, on the amount of equity the rate of interest to be paid by WAPDA is 17% called IRP' whereas on the part of debt it is for less may be about 6 % .
(c) According to the original agreement and its Schedule 6 such matters were to be referred to Experts, in case of difference of opinion, whose decision was to be final and such matters were kept out of the pale of the arbitration clause and through impugned amendments the provisions contained in Schedule 6 for reference of these matters to expert was done away with, as a consequence of which HUBCO allegedly had free hand to get tariff and CPP amount arbitrarily raised, as a consequence of which the WAPDA allegedly would have to pay an amount of 30 Billion Dollar in, excess in the, entire period of the contract, which prima faire ‑seems to be unconscionable and without consideration.
(d) From the documents placed on the record by both the parties and particularly the learned counsel for the appellant/HUBCO it is manifest that there was a prolonged negotiation between HUBCO and WAPDA on these matters and WAPDA had throughout been resisting and opposing the demands of HUBCO about the raise of tariff, CPP‑etc., but after the installation of new Government after Elections in October, 1993 the disputed documents were executed and it is not clear from the record as to how these hotly contested matters, for such a long time, were brought to an end suddenly and further for what consideration supplementary‑ deed for amendment and second amendment were abruptly executed and so on whose behest and for what consideration. It is pertinent to note that the allegations of corruption as are disclosed in the F.I.Rs. lodged by WAPDA are against specified persons with particularity of the newly installed high officials in the Ministry. These circumstances prima facie do establish the case of misuse of power by public functionary for extraneous considerations requiring detailed examination and decision by a Court of law after full‑fledged trial.
In arriving at this conclusion we have taken note of the following circumstances:‑‑
(a) Though in supplemental deed reference has been made to newly Schedule 6 but surprising the same was not annexed with the said deed as its part. The said new Schedule 6 was not got signed by HUBCO from the Chairman, WAPDA, whereas the same was signed by one Muhammad Ashraf, who later on expressly declared that he was not authorised to sign the said document, but no steps were taken to get this Schedule 6 regularized by HUBCO by insisting that the same should be got signed by some authorized person.
(b) Likewise Schedule 1(A), 1(B) and 1(C) which were placed in place of the previous Schedule containing rates of tariff etc., were not signed by WAPDA but by Chief Economist of WAPDA.
(c) We have also taken note that officers of WAPDA left the service of WAPDA conveniently, one of whom was paid the huge amount of security which he provided at the time of joining service and joined the service of HUBCO at an exuberant salary, which fact during arguments was not denied by the learned counsel for HUBCO.
(d) The payment of IRP on the equity amount was allowed retrospectively with effect from 17‑11‑1993 by providing that the actual amount shall be deemed to have been injected on the said date though the same was allegedly injected later on burdening the WAPDA with huge amount to be paid to HUBCO.
(e) According to the original arrangement between the parties, at the expiry of the contract period, the ownership of the plant was to vest in the WAPDA whereas subsequently it was decided that the same would vest in HUBCO, prima facie without any consideration or benefit of WAPDA, the amount of CPP and rates of tariff had been allegedly unreasonably raised without any plausible reasons.
The allegations of corruption in support of which the above mentioned circumstances do provide prima facie basis for further probe into matter judicially and, if proved, would render these documents as void, therefore, we are of the considered view that according to the public policy such matters, which require finding about alleged criminality, are not referable to Arbitration.
The disputes between the parties are not commercial dispute arising from an undisputed legally valid contract, or relatable to such a contract, for, according to the case of WAPDA on account of these criminal acts disputed documents did not bring into existence any legally binding contract between the parties, therefore, the dispute primarily relates to very existence of a valid contract and not a dispute under such a contract.
Additionally we have also noted from the documents on record that WAPDA has throughout been asking HUBCO to furnish documents to ascertain the correctness of their stand in the matter of costs of construction and tariff but a deaf ear was turned. Parties to bear their own costs. ‑
I agree.
(Sd.)
SH. IJAZ NISAR, J.
I agree.
(Sd.)
MUNIR A. SHEIKH, J.
ORDER OF THE COURT
We hold by majority of (2 to 3) that Civil Appeal No. 1399 of 1999 filed by WAPDA against HUBCO is allowed, and the respondent HUBCO is restrained from invoking the arbitration clause of the agreement and Civil Appeal No. 1398 HUBCO v. WAPDA stands dismissed.
(Sd. )
MUHAMMAD BASHIR JEHANGIRI, ACTG. C.J.
(Sd.)
SH. IJAZ NISAR, J.
(Sd.)
ABDUR REHMAN KHAN, J.
(Sd.)
SH. RIAZ AHMED, J.
(Sd.)
MUNIR A. SHEIKH, J
M.B.A./H‑18/S Order accordingly.
PLD 2000 SC 869
[Supreme Court of Pakistan]
Present: Irshad Hasan Khan, C J., Muhammad Bashir Jehangiri, Sh. Ijaz Nisar, Abdur Rehman Khan, Sh.Riaz Ahmed, Ch. Muhammad Arif, Munir A. Sheikh, Rashid Aziz Khan, Nazim Hussain Siddiqui, Iftikhar Muhammad Chaudhary, Qazi Muhammad Farooq and Rana Bhagwan Das, JJ
Syed ZAFAR ALI SHAH and others---Petitioners
versus
General PERVEZ.MUSHARRAF, CHIEF EXECUTIVE
OF PAKISTAN and others---Respondents
Constitutional Petitions Nos. 62, 63, 53, 57, 66, 64 of 1999 and 3 of 2000, decided on 12th May, 2000.
(Constitution petition under Article 184(3) of the Constitution of the Islamic Republic of Pakistan, 1973). ?????????
(a) Constitution of Pakistan (1973)---
----Art.184---Provisional Constitution Order (1 of 1999), Preamble---Oath of Office of (Judges) Order (1 of 2000), Art.3---Proclamation of Emergency by Chief Executive of Pakistan dated 14-10-1999---Extra-constitutional step of taking over the affairs of Pakistan by the Armed Forces of Pakistan---Power of judicial review of Supreme Court---Concept and scope---Restriction imposed by Provisional Constitution Order, 1999 does not in any way restrict the power of judicial review of Supreme Court whereunder the Court has an inherent power to interpret any provision of the Constitution or any other legislative instrument or law, even if that particular provision is the one which seeks to oust the jurisdiction of Supreme Court---No form of oath taken by or administered to the Judges of superior Courts can restrict the judicial power and derogate from the legal position that the Courts, as final arbiters in any constitutional controversy, retain their power and jurisdiction to say as to what a particular provision of the Constitution or the law means or does not mean even if that particular provision is one seeking to oust such jurisdiction of the Court---On no principle of necessity could powers of the judicial review vested in the superior Courts under Constitution of Pakistan (1973) be taken away---Any provision purporting to restrain the power of judicial review of the superior Courts is to be ignored altogether--?Principles.
Judicial power means that the superior Courts can strike down a law on the touchstone of the Constitution. The nature of judicial power and its relationship to jurisdiction are all allied concepts and the same cannot be taken away. It is inherent in the nature of judicial power that the Constitution is regarded as the supreme law and any law or act contrary to it or infringing its provisions is to be struck down by the Court in that the duty and function of the Court is to enforce the Constitution.
The basic question, which needs to be resolved in the present case is whether the restriction imposed by the Provisional Constitution Order 1 of 1999 on the jurisdiction of Supreme Court does in anyway restrict the power of judicial review of Supreme Court whereunder if has an inherent power to interpret any provision of the Constitution. or any other legislative instrument or law, even if that particular provision is a provision which seeks to oust the jurisdiction of Supreme Court.
Judiciary is the only forum recognized by both the rulers and the ruled where: (1) questions of validity and legitimacy are capable of being resolved finally with a view to controlling the recklessness of the Government in power and where (2) declining to resolve it would tantamount to self-condemnation, self-destruction and betrayal of the trust of the people of Pakistan. No form of oath taken by or administered to the Judges of the superior Courts can restrict the judicial power and derogate from the legal position that the Courts, as final arbiters in any constitutional controversy, retain their power and jurisdiction to say as to what a particular provision of the Constitution or the law means or does not mean even if that particular provision is one seeking to oust such jurisdiction of the Court. Any attempt to control or circumscribe the judicial power of the superior Courts with a view to denying -them the right to decide the validity and the quantum of legislative power of the new regime, would be an exercise in futility. Changing the form of oath will neither take away power of judicial review nor the jurisdiction of Supreme Court. Notwithstanding the new oath or its language, the Courts shall continue to have jurisdiction to decide the controversy involved as if the new oath and the "new constitutional documents" under which the oath is administered, do not adversely affect the jurisdiction and power of the Court. Superior Courts follow the Code of Conduct prescribed for the Judges and inherently owe allegiance to the State of Pakistan, which requires Supreme Court to decide the issue of validity of the new regime under which the Judges are being asked to take new oath inasmuch as such allegiance cannot be taken away. The oath administered under the Constitution has to be respected because that draws its authority from the people of Pakistan whereas the oath under the Constitution to defend the same has a different meaning than an oath administered under a document, validity whereof is yet to be determined and thus the two are incomparable.
The Objectives Resolution recognises the `Islamic doctrine of sovereignty' as expounded in the Holy Book (Qur'an), that sovereignty belongs neither to the ruler nor the ruled but Almighty Allah alone which is to be exercised by the people of Pakistan through their chosen representatives. The Objectives Resolution also envisages that the independence of Judiciary is to be fully secured. It is a fundamental principle of jurisprudence that Courts must always endeavour to expand their jurisdiction so that the rights of the people are guarded against arbitrary violations by the executive. The orders of the Chief Executive are subject to the jurisdiction of the Constitutional Courts of the land. By including paragraphs 2(b) and 7 in the Provisional Constitution Order, 1999, it has been recognized that the superior Courts, which are respected by the people being an embodiment of the ideals of justice and guardian of the rights of the people are not merely entitled to continue but have, in fact, done so in the past as well. The Oath of Office (Judges) Order, 2000 (Order 1 of 2000), dated 25th January, 2000 allows all the Courts to continue to function and exercise powers, which is a reiteration of what was earlier stated by the Oath of Office (Judges) Order, 1999 (Order 10 of 1999), paragraph 3 whereof states that Order 1 of 2000 shall apply to:. (1) newly appointed Judges; (2) that Oath shall be made before the constitutional authority; and (3) that it would be in accordance with the appropriate form set out in the Third Schedule to the Constitution. This required the newly appointed Judges to take oath before the constitutionally designated authority and as per the procedure prescribed by the Constitution and not by the Order 1 of 2000. Any provision purporting to restrain the power of judicial review of the superior Courts is to be ignored altogether. A Judge acting in his conscience and in good faith may decide to resign or he may decide that in the higher public interest he would retain office as has been done by the Judges of Supreme Court and other Judges of the Superior Judiciary.
Contention that after having taken oaths -of their offices under the Provisional Constitution Order, 1999 as amended, the Judges of the superior Courts are bound to defend the Proclamation of Emergency and the Provisional Constitution Order, 1999 as amended, in that, the old Constitution has been replaced by a new revolutionary order on the basis of the verdict earlier given by Supreme Court in the case of Begum Nusrat Bhutto PLD 1977 SC 657, is totally misconceived in that it was clearly stated in the said judgment that on no principle of necessity could powers of the judicial review vested in the superior Courts under 1973 Constitution be taken away. The old Order has not been replaced by a new Order but it was merely a case of constitutional deviation for a temporary period.
The evolution of judicial power is coterminous with the evolution of civilization and this is so because judicial power has to check the arbitrary exercise of powers by any organ or authority. Provisional Constitution Order, 1999 purports to suspend the Constitution on the one hand and, on the other, it says that the country will be governed in accordance with the provisions of the Constitution as nearly as possible. What emerges from this is that the Fundamental Rights are left intact except those which had been suspended by the earlier Proclamation of Emergency dated 28-5-1999 i.e. Articles 15 to 19 and 24 of the Constitution.
The Court must take into account before determining the legitimacy of a revolutionary regime, the two oblique arguments, which would attempt to undermine it: one relating to collapse of its jurisdiction with the disappearance of .the old Constitution; and the other relating to subservience of the Judiciary to the new regime.
Judicial review, must, therefore, remain strictly judicial and in its exercise, Judges must take care not to intrude upon the domain of the other branches of Government.
The power of judicial review should be exercised with caution.
The Army take-over of 12th October, 1999 was extra? constitutional. The superior Courts of Pakistan retain the power of judicial review despite the ouster of jurisdiction which came either from within the Constitution, or by virtue of Martial Law Orders or by legislation. Even non obstante clauses in these cases would fail to prevent such objectives of the incumbent administrations.
Thus visualised, the purported ouster in the Proclamation and the Provisional Constitution Order, 1 of 1999 of the jurisdiction of the superior Courts is an exercise in futility and the power of judicial review remains intact. Both under Islamic doctrines as well as under its constitutional/ juridical personality, the superior Courts would continue to exercise this power.
Imtiaz Ahmad v. Government of Pakistan through Secretary, Interior Division 1994 SCMR 2142; William Marbury v. James Medison 2 Law Ed. 60; Spirit of Law by Montesquieu; Begum Nusrat Bhutto v. Chief of the Army Staff PLD 1977 SC 657; Principles of Revolutionary Legality by J.M. Eekelaar and Constitutional Legitimacy---A Study of the Doctrine of Necessity by Leslie Wolf-Phillips ref.
(b) Constitution of Pakistan (1973)---
----Arts.2A & 175---Independence, of Judiciary---Concept---Independence of Judiciary is basic principle of the constitutional system of governance--?Judiciary has to be properly organized and effective and efficient enough to quickly address and resolve public claims and grievances; and also has to be strong and independent enough to dispense justice fairly and impartially--?Efficient and independent Judiciary can foster an appropriate, legal and Judicial environment where there is peace and security in the society, safety of life, protection of property and guarantee of essential human rights and fundamental freedoms for all individuals and groups, irrespective of any distinction or discrimination on the basis of caste, creed, colour, culture, gender or place of origin etc. ---Such a legal and judicial environment, is conducive to economic growth and social development---Principles.
The Objectives Resolution contained in the Preamble to the Constitution, which now forms substantive part thereof by virtue of Article 2A as well as declaration of Quaid-e-Azam about democratic set-up and social justice, envisage independence of Judiciary.
The basic functions of the Judiciary are to promote the administration of justice, to protect Human Rights and to maintain Rule of Law in the country.
The independence of Judiciary is a basic principle of the constitutional system of governance in Pakistan. The Constitution of Pakistan contains specific and categorical provisions for the independence of Judiciary. The Preamble and Article 2A state that "the independence of Judiciary shall be fully secured"; and with a view to achieve this objective, Article 175 provides that "the Judiciary shall be separated progressively from the executive".
In a system of constitutional governance, guaranteeing Fundamental Rights, and based on principle of trichotomy of powers, such as ours, the Judiciary plays a crucial role of interpreting and applying the law and adjudicating upon disputes arising among governments or between State and citizens or citizens inter se. The Judiciary is entrusted with the responsibility for enforcement of Fundamental Rights. This calls for an independent and vigilant system of judicial administration so that all acts and actions leading to infringement of Fundamental Rights are nullified and the rule of law upheld in the society.
The Constitution makes it the exclusive power/responsibility of the. Judiciary to ensure the sustenance of system of "separation of powers" based on checks and balances. This is a legal obligation assigned to the Judiciary. It is called upon to enforce the Constitution and safeguard the Fundamental Rights and freedom of individuals. To do so, the Judiciary has to be properly organized and effective and efficient enough to quickly address and resolve public claims and grievances; and also has to be strong and independent enough to dispense justice fairly and impartially. It is such an efficient and independent Judiciary which can foster an appropriate legal and judicial environment where there is peace and security in the society, safety of life, protection of property and guarantee of essential human rights and fundamental freedoms for all individuals and groups, irrespective of any distinction or discrimination on the basis of caste, creed, colour, culture, gender or place of origin, etc. It is' indeed such a legal and judicial environment, which. is conducive to economic growth and social development.
The independence of Judiciary requires that the Judiciary shall decide matters before it in accordance with its impartial assessment of the facts and its understanding of the law without improper influences, direct or indirect; from any source. The Judiciary in Pakistan is, independent. It claims and has always claimed that it has the right to interpret the Constitution and any legislative instrument and to say as to what a particular provision of the Constitution or a legislative instrument means or does not mean, even if that particular provision is a provision seeking to oust the jurisdiction of the Supreme Court.
Al-Qur'an: Sura Al-Nisa, Verses 135-136 by Allama Abdullah Yousaf. Ali; Letter sent by Hazrat Umar to Abu Musa Al-ash'ari, Governor Basra/Chief Qazi; Beijing Statement of Principles of the Independence of Judiciary in the LAWASIA Region (6th Conference of Chief Justices of Asia and the Pacific held at - Beijing on 19-8-1995); Government of Sindh v. Sharaf Faridi PLD 1994 SC 105; Al-Jehad Trust v. Federation of Pakistan PLD 1996 SC 324; Malik Asad Ali v. Federation, of Pakistan PLD 1988 SC 161; Mehram Ali v. Federation of Pakistan PLD 1998 SC 1445 and Sh. Liaquat Hussain v. Federation of Pakistan PLD 1999 SC 504 and The Federalist Papers by Alexander Hamilton-James Madison-John Jay ref.
(c) Corruption---
---- Connotation and scope---Effect of corruption on society and way of life of the people.
`Corruption' is generally defined as the abuse of public office for private gain. In view of the fact that scope of corruption has widened, this definition would include the abuse of all offices of trust. It has diverse meanings and far-reaching effects on society, government and the people. Of late, the culture of corruption and bribe has embedded in the society to the extent that even routine works which should be done without any approach or influence, are commonly known to be done only on some such consideration. This bribe culture has plagued the society to the extent that it has become a way of life.
Values in public life and perspective of values in public life, have undergone serious changes and erosion during the last few decades. What was unheard before is commonplace today. A new value orientation is being undergone in our life and culture.' People are at the threshold of the cross?roads of values. It is for the sovereign people of the country to settle these conflicts yet the Courts have a vital role to play in these matters.
Once corruption pervades in the body politic and official circles, then the entire Government/administration becomes completely crippled and paralyzed.
When corruption permeates in the social, political and financial transactions to such an extent that even proper and honest orders and transactions are suspected to the point of belief, being a result of corruption, one is compelled to infer all is not well and corruption has gone deep in the roots. No doubt, this is an age of "corruption eruption", but during the last few years there have been large scale prosecutions of former world leaders in various countries on the charges of corruption and corrupt practices, in some cases leading to convictions, which phenomenon must not be taken lightly and the issue must be addressed adequately and effectively through transparent institutionalized processes.
(1988) 2 SCC 602; Kh. Ahmed Tariq Rahim's case PLD 1992 SC 646; Mian Muhammad Nawaz Sharif's case PLD 1993 SC 47~ and Benazir Bhutto's case PLD 1998 SC 388 ref.
(d) Provisional Constitution Order (1 of 1999)---
----Preamble---Proclamation of Emergency by Chief Executive of Pakistan dated 14-10-1999---Constitution of Pakistan (1973), Art.184(3)---Extra? constitutional step of taking over the affairs of Pakistan by the Armed Forces of Pakistan---Allegations of corruption etc. against parliamentarians or politicians or members from the general public---Proceedings commenced against all said persons were to be decided on their own merits in accordance with law and on the basis of the legally admissible material brought before the concerned fora in those proceedings and only after the finalisation of the said proceedings that the country will be geared up for resort to democratic principles and corruption-free society which are pre?requisites for good governance.
(e) Provisional Constitution Order (1 of 1999)---
----Preamble---Proclamation of Emergency by Chief Executive of Pakistan dated 14-10-1999---Constitution of Pakistan (1973), Art.184(3)---Extra ?constitutional step of taking over the affairs of Pakistan by the Armed Forces of Pakistan ---Factors---Validity---Misdeclaration of assets before the Wealth Tax Authorities qua the Election Commission and allegations of massive corruption and corrupt practices by the large number of politicians by itself may not be a ground for intervention of the Armed Forces but such aspect of the matter, when viewed in the overall context and with particular reference to the alleged massive corruption and corrupt practices, becomes a relevant factor.
(f) Provisional Constitution Order (1 of 1999)---
----Preamble---Proclamation of Emergency by Chief Executive of Pakistan dated 14-10-1999---Constitution of Pakistan (1973), Art.184(3)---Extra? constitutional step of taking over the affairs of Pakistan by the Armed Forces of Pakistan ---Factors---Validitiy---Combined effect of the overall policies and methodology adopted by the former Government was the total collapse of the country's economy inasmuch as G. D. P. growth during the past three years had hardly kept pace with the growth of population and Pakistan had a debt burden which equalled the country's entire national income---Supreme Court also took judicial notice of the fact that the trade imbalance was persistent and due to defective economic policies and lack of economic discipline by the previous regime, the industrial sector had suffered a great set back.
Federation of Pakistan v. Shaqkat Ali Mian PLD 1999 SC 1026 ref.
(g) Provisional Constitution Order (1 of 1999)--
----Preamble---Proclamation of Emergency by Chief Executive of Pakistan dated 14-10-1999--Constitution of Pakistan (1973), Art.184(3)---Extra? constitutional step of taking over the affairs of Pakistan by the Armed Forces of Pakistan---Factors---Validity-=-On the day when the Army took over and for years prior to that time there was merely a feigned appearance of what could be called a form of "oligarchy" which means a Government in which the authority constitutionally reposes in a few individuals and families and a small coterie of individuals who, because of economic and other power, could influence measurably the policy of the Government.
New Dictionary of American Politics by Smith and Zucher, First Edn., p.114 and The Politics of American Democracy by M. Irish, Third Edn., pp. 52 to 81 ref.
(h) Provisional Constitution Order (1 of 1999)---
----Preamble---Proclamation of Emergency by Chief Executive of Pakistan dated 14-10-1999---Constitution of Pakistan (1973), Art.184(3)---Extra ?constitutional step of taking over the affairs of Pakistan by the Armed Forces of Pakistan---Factors---Validity---Low turnout of voters during past elections---Effect---General apathy and indifference is discernible and has a direct nexus with the unenviable performance of the former Governments--?Had appropriate steps been taken by the Governments in the past to undo the damage done to the general thinking of the people, the things would have been totally different---Proportions which the misrule had taken beginning before the take-over by the Army, were to the discredit of all concerned.
(i) Provisional Constitution Order (1 of 1999)---
---Preamble---Proclamation of Emergency by Chief Executive of Pakistan dated 14-10-1999---Constitution of Pakistan (1973), Arts.184(3). & 91(4), (5)---Extra-constitutional step of taking over the affairs of Pakistan by the Armed Forces of Pakistan---Suspension of Assemblies and the Senate through extra-constitutional measures by the Chief of Army Staff--?Factors---Validity---Doctrine of State necessity---Applicability---Role of public representatives---Principle of joint and ministerial responsibility in Parliamentary system---Rest of the members of representative bodies cannot be absolved of their responsibility if, despite wrongdoings by the cabinet, they remained silent spectators---Suspension of the Assemblies and the Senate through extra-constitutional measures taken by the Chief of Army Staff, warrants validation on the ground of State necessity and State survival.
(j) Constitution of Pakistan (1973)---
----Art.58(2)(b) [since repealed]---Dissolution of National Assembly--?Balance governing the powers of the President and the Prime Minister--?Never safe to confer unfettered powers on a person who was holding the reins of the affairs of the country as "power corrupts and absolute corrupts absolutely"---Situation could have been avoided if checks and balances governing the powers of the President and the Prime Minister had been in the field by means of Art.58(2)(b) of the Constitution of Pakistan (1973).
(k) Provisional Constitution Order (1 of 1999)---
----Preamble---Proclamation of Emergency by Chief Executive of Pakistan dated 14-10-1999---Constitution of Pakistan (1973), Arts.184(3) & 63(2)--?Extra-constitutional step of taking over the affairs of Pakistan by the Armed Forces of Pakistan---Factors---Validity---Ridiculing the Judiciary and tapping of telephones of Judges of superior Courts---Debates of Parliament of the relevant period clearly demonstrated that integrity and independence of the Judiciary of Pakistan were challenged by the Members of Parliament which had the effect of defaming and bringing the Judges into ridicule and disparaging remarks against the Judiciary crossed all limits and no Reference was made to the Chief Election Commissioner for their disqualification as Members of the Parliament under Art.63(2) of the Constitution of Pakistan (1973)---Such acts of tapping the telephones of Judges of the superior Courts and maligning the Judiciary were most detestable, immoral, illegal and unconstitutional.
Sh. Liaquat Hussain v. Federation of Pakistan PLD 1999 SC 504 and Mohtarama Benazir Bhutto's case PLD 1998 SC 388 ref.
(1) Provisional Constitution Order (1 of 1999)---
----Preamble---Proclamation of Emergency by Chief Executive of Pakistan dated 14-10-1999---Constitution of Pakistan (1973), Art.184(3)---Extra ?constitutional step of taking over the affairs of Pakistan by the Armed Forces of Pakistan---Factors---Validity---Doctrine of State necessity--?Applicability---Machinery of the Government at the Centre and the Provinces had completely broken down and the Constitution had been rendered unworkable, and a situation had arisen for which the Constitution provided no solution and the Armed Forces had to intervene to save the State from further chaos, for maintenance of peace and order, economic stability, justice and good governance and to safeguard integrity and sovereignty of the country dictated by highest considerations, of State necessity and welfare of the people.
(m) Provisional Constitution Order (1 of 1999)---
----Preamble---Proclamation of Emergency by Chief Executive of Pakistan dated 14-10-1999---Constitution of Pakistan (1973), Art.184(3)---Extra?constitutional step of taking over the affairs of Pakistan by the Armed Forces of Pakistan---Validity---Precedents from foreign jurisdictions--?Applicability ---Precedents from foreign jurisdictions, though entitled to reverence and respect but are not ipso facto applicable to the facts and circumstances prevailing on the day of taking over by the Armed Forces.
(n) Provisional Constitution Order (1 of 1999)---
----Preamble---Proclamation of Emergency by Chief Executive of Pakistan dated 14-10-1999---Constitution of Pakistan (1973), Art.184(3)---Extra?constitutional step of taking over the affairs of Pakistan by the Armed Forces of Pakistan---Validity---Doctrine of State necessity---Applicability---To save and maintain the integrity, sovereignty and stability of the country and having regard to the welfare of the people while interpreting the legislative instruments i.e.. Provisional Constitution Order, 1999 and Proclamation of Emergency by Chief Executive of Pakistan dated 14-10-1999, Court has to make every attempt to save "what institutional values remained to be saved" with a view to maintaining and upholding the independence of Judiciary which in turn would protect the State fabric and guarantee Human/Fundamental Rights---Doctrine of State necessity had not been rejected in the judgment of Supreme Court in Liaquat Hussain v. Federation of Pakistan PLD 1999 SC 504---Prerequisites of doctrine of State necessity stated.
Sh. Liaquat Hussain v. Federation of Pakistan PLD 1999 SC 504; Attorney-General of the Republic v. Mustafa Ibrahim Cypress Law Reports 105; Begum Nusrat Bhutto v. Chief of the Army Staff PLD 1977 SC 657 and Miss Asma Jilani's case PLD 1972 SC 139 ref.
(o) Provisional Constitution Order (1 of 1999)---
----Preamble---Proclamation of Emergency by Chief Executive of Pakistan dated 14-10-1999---Constitution of Pakistan (1973), Art.184(3)---Extra?constitutional step of taking over the affairs of Pakistan by the Armed Forces of Pakistan---Factors---Validity---Doctrine of State necessity ---Application--?All the elements viz. inevitable necessity; exceptional circumstances; no other remedy to apply, measures taken being proportionate to the necessity and of temporary character limited to the duration of exceptional circumstances, were present, inasmuch as, the Constitution provided no solution to meet the extraordinary situation prevailing on 12th October, 1999 when the Armed Forces took over the affairs of Pakistan.
Sh. Liaquat Hussain v. Federation of Pakistan PLD 1999 SC 504; Attorney-General of the Republic v. Mustafa Ibrahim Cypress Law Reports 105 and Begum Nusrat Bhutto v. Chief of the Army Staff PLD 1977 SC 657 ref.
(p) State necessity, doctrine of---
----Applicability---Elements---Inevitable necessity; exceptional circumstances; no other remedy to apply; measures taken being proportionate to the necessity and of temporary character limited to the duration of exceptional circumstances, were the elements for application of the doctrine.
Sh. Liaquat Hussain v. Federation of Pakistan PLD 1999 SC 504; Attorney-General of the Republic v. Mustafa Ibrahim Cypress Law Reports 105 and Begum Nusrat Bhutto v. Chief of the Army Staff PLD 1977 SC 657 ref.
(q) Provisional Constitution of Order (1 of 1999)---
----Preamble---Proclamation of Emergency by Chief Executive of Pakistan dated 14-10-1999---Constitution of Pakistan (1973), Art.184(3)---Extra?constitutional step of taking over the affairs of Pakistan by the Armed Forces of Pakistan---Validity- -;.Doctrine of State necessity ---Applicability--?Intervention by the Armed Forces on 12th October, 1999 was an imperative and inevitable necessity in view of the exceptional circumstances prevailing at that time, and, therefore, there was no valid justification for not validating the extra-constitutional measure of the Armed Forces on the technical distinction between "doctrine of necessity" and the "doctrine of State necessity".
Begum Nusrat Bhutto v. Chief of the Army Staff PLD 1977 SC. 657; The Classics of International Law by Hugo Grotius; A Treatise on the Law of the Prerogative of the Crown and the Relative Duties and Rights of the Subject by Joseph Chitty; The Gabcikovo-Nagymaros Project, decided by International Court of Justice; Corpus Juris Secundum, Vol.65, p.387; Constitutional and Administrative Law by Stanley De Smith and Rodney Brazier, 8th Edn. 1998; Makenete v. Lekhanya and others (1993) 3 LRC; Attorney-General of the Republic v: Mustafa Ibrahim Cypress Law Reports 105; Mitchell and others v. Director of Public Prosecutions and another 1986 LRC. (Grenada); States of Emergency---Their Impact on Human Rights; From Military to Civilian Rule, Edited by Constantine P. Danopoulos and Democracy, the Rule of Law and Islam, Edited by Eugene Cotran and Adel Omar Sherif ref.
(r) Constitution of Pakistan (1973)---
----Art.232---Proclamation of Emergency---State of emergency--?Interpretation---State of emergency includes "regimes of exception" i.e. regimes which have overthrown and not merely suspended the previous constitutional order and have assumed legislative and executive powers analogous to those under a formal state of emergency---Government to take steps to ensure that the Fundamental Rights of citizens are not affected and derogation must be proportionate to the emergency, while adopting constitutional as well as extra-constitutional means---Effort to be made to minimize emergencies and to induce the authorities concerned to respect. the Fundamental Rights.
Begum Nusrat Bhutto v. Chief of the Army Staff PLD 1977 SC 657; The Classics of International Law by Hugo Grotius; A Treatise on the Law of the Prerogative of the Crown and the Relative Duties and Rights of the Subject by Joseph Chitty; The Gabcikovo-Nagymaros Project decided by International Court of Justice; Corpus Juris Secundum, Vol.65, p.387; Constitutional and Administrative Law by Stanley De Smith and Rodney Brazier, 8th Edn. 1998; Makenete v. Lekhanya and others (1993) 3 LRC; Attorney-General of the Republic v. Mustafa Ibrahim Cypress Law Reports 105; Mitchell and others v. Director of Public Prosecutions and another 1986 LRC (Grenada); States of Emergency---Their Impact on Human Rights; From Military to Civilian Rule, Edited by Constantine P. Danopoulos and Democracy, the Rule of Law and Islam, Edited by Eugene Cotran and Adel Omar Sherif ref.
(s) Provisional Constitution Order (1 of 1999)--
----Preamble---Proclamation of Emergency by Chief Executive of Pakistan dated 14-10-1999---Constitution of Pakistan (1973), Art.184(3)---Extra?constitutional step of taking over the affairs of Pakistan by the Armed Forces of Pakistan---Validity---Doctrine of State necessity ---Applicability--?Invocation of the "doctrine of State necessity" depends upon the peculiar and extraordinary facts and circumstances of a particular situation---Superior Courts alone can decide as to whether any given peculiar and extraordinary circumstances warrant the application of doctrine of State necessity or not--?Such dependence has a direct nexus with what preceded the action itself--?Material available on record generally will be treated at par with the "necessity/State necessity/continuity of State" for the purposes of attaining the proportions justifying its own scope as also the future and expected course of action leading to restoration of democracy.
Begum Nusrat Bhutto v. Chief of the Army Staff PLD 1977 SC 657; The Classics of International Law by Hugo Grotius; A Treatise on the Law of the Prerogative of the Crown and the Relative Duties and Rights of the Subject by Joseph Chitty; The Gabcikovo-Nagymaros Project, decided by International Court of Justice; Corpus Juris Secundum, - Vol.65, p.387; Constitutional and Administrative Law by Stanley De Smith and Rodney Brazier, 8th Edn. 1998; Makenete v. Lekhanya and others (1993) 3 LRC; Attorney-General of the Republic v. Mustafa Ibrahim Cypress Law Reports 105; Mitchell and others v. Director of Public Prosecutions and another 1986 LRC (Grenada); States of Emergency---Their Impact on Human Rights; From Military to Civilian Rule, Edited by Consiantine P. Danopoulos and Democracy, the Rule of Law and Islam,, Edited by Eugene Cotran and Adel Omar Sherif ref.
(t) Doctrine of necessity---
---- Not restricted to criminal prosecution alone.
(u) State necessity, doctrine of---
----Invocation---Conditions detailed.
The invocation of the doctrine of State necessity depends upon the peculiar and extraordinary facts and circumstances of a particular situation. It is for the superior Courts alone to decide whether any given peculiar and extraordinary circumstances warrant the application of the above doctrine or not. This dependence has a direct nexus with what preceded the action itself. The material available on record generally will be treated at par with the "necessity/State necessity/continuity of State" for the purposes of attaining the proportions justifying its own scope as also the future and expected course of action leading to restoration of democracy.
Begum Nusrat Bhutto v. Chief of the Army Staff PLD 1977 SC 657; The Classics of-International Law by Hugo Grotius; A Treatise on the Law of the Prerogative of the Crown and the Relative Duties and Rights of the Subject by Joseph Chitty; The Gabcikovo-Nagymaros Project decided by International Court of Justice; Corpus Juris Secundum, Vol.65, p.387; Constitutional and Administrative Law by Stanley De Smith and Rodney Brazier, 8th Edn. 1998; Makenete v. Lekhanya and others (1993) 3 LRC; Attorney-General of the Republic v. Mustafa Ibrahim Cypress Law Reports 105; Mitchell and others v. Director of Public Prosecutions and another 1986 LRC (Grenada); States of Emergency---Their Impact on Human Rights; From Military to Civilian Rule, Edited by Constantine P. Danopoulos and Democracy, the Rule of Law and Islam, Edited by Eugene Cotran and Adel Omar Sherif ref.
(v) Provisional Constitution Order (1 of 1999)---
----Preamble---Proclamation of Emergency by Chief Executive of Pakistan dated 14-10-1999---Constitution of Pakistan (1973), Art.184(3)---Extra? constitutional step of taking over the affairs of Pakistan by the Armed Forces of Pakistan---Validation accorded to the action of the Armed Forces by Supreme Court---Effect---Held, though initially the status of the Government after taking over the affairs of Pakistan was de facto, but in view of the validation accorded by the Supreme Court through its short order, it had attained the status of a de jure Government.
(w) Provisional Constitution Order (1 of 1999)---
----Preamble---Proclamation of Emergency by Chief Executive of Pakistan dated 14-10-1999---Constitution of Pakistan (1973), Art.184(3)---Extra?constitutional step of taking over the affairs of Pakistan by the Armed Forces of Pakistan---Validity---Doctrine of State necessity---Applicability---All that is required to be considered that the extra-constitutional action should have nexus with the facts on the ground---Duty of superior Court is that it recognizes the evil, suggests remedial measures therefor and lays down infrastructure for a journey leading to the restoration of the democratic processes/institutions as expeditiously as possible---If, however, those responsible for achieving said objectives fall short of the measures within the contemplation of the law during their tenures respectively, then the remedy lies in identifying the facts on the ground and taking remedial measures to suppress the evil---Prolonged involvement of the Army in civil affairs runs a grave risk of politicizing it, which would not be in national interest and civilian rule in the country must be restored within the shortest possible time after achieving the declared objectives as reflected in the speeches of the Chief Executive dated 13th and 17th October, 1999 which necessitated the military take-over---Action of Armed Forces of taking over the affairs of Pakistan qualified for validation on the ground of State necessity/survival in circumstances, Recognition of a situation of whatever magnitude does call for remedial measures to be considered/contemplated with a view to purging the situation on the- ground. All that is required to be considered is that the action should have a nexus with the facts on the ground. Such consideration can be undertaken only by the superior Courts in the exercise of their powers under Articles 199 and 184 of the Constitution. It is the duty of the superior Courts that they recognize the evil, suggest remedial measures therefore and lay down infrastructure for a journey leading to the restoration of the democratic processes/institutions as expeditiously as possible. If those responsible for achieving these objectives fall short of the measure within the contemplation of the law during their tenures respectively, then the remedy lies in identifying the facts on the ground and taking remedial measures to suppress the evil. The action of 12th October, 1999 being what it is, qualifies for validation on the ground of State necessity/survival. It is for the representatives of the people to see to it that everything is in order and nobody can raise his little finger when their actions are in dine with the fundamentals of the Constitution. No rule except that by the representatives of the people within the contemplation of the Constitution and the law has the support of the Superior Judiciary. Courts are firmly committed to the governance of the country by the people's representatives and the definition of the term `democracy' to the effect that "it is Government of the people, by the people and for the people" and not by the Army rule for an indefinite period. Prolonged involvement of the Army in civil affairs runs a grave risk of politicizing it, which would not be in national interest and that civilian rule in the country must be restored within the shortest possible time after achieving the declared objectives as reflected in the speeches of the Chief Executive, dated 13th and 17th October, 1999, which necessitated the military take-over.
(x) Provisional Constitution Order (1 of 1999)---
----Preamble---Proclamation of Emergency by Chief Executive of Pakistan dated 14-10-1999---Constitution of Pakistan (1973), Art.184(3)---Extra ?constitutional step of taking over the affairs of Pakistan by the Armed Forces of Pakistan---Factors---Validity---Doctrine of State necessity--?Applicability---Whole spectrum of circumstances prevalent on or before 12th October, 1999, the day when Armed Forces took over the affairs of Pakistan, revealed that the representatives of the people, who were responsible for running the affairs of the State, were accused of corruption and corrupt practices and failed to establish good governance in the country as a result whereof a large number of references had been filed against the former Prime Minister, Ministers, Parliamentarians and members of the Provincial Assemblies for their disqualification on account thereof---Process of accountability carried out by the former Government was shady, inasmuch as, either it was directed against the political rivals or it was not being pursued with due diligence---All institutions of the State including Judiciary were being systematically destroyed in the pursuit of self-serving policies---Democratic institutions were not functioning in accordance with the Constitution, they had become privy to the one man rule and the very purpose for which they were established stood defeated by their passive conduct---Attempts were made to politicize the army, destabilize it and create dissension within its ranks and had the former Prime Minister been successful in his designs, there would have been chaos and anarchy rather a situation of civil war where some factions of Armed Forces were fighting against other---Action of Armed Forces of taking over the affairs of Pakistan having nexus with the facts on the ground, was qualified to be validated on the ground of State necessity/survival in circumstances.
An overall view of the whole spectrum of circumstances prevalent on or before 12th October, 1999 revealed that the representatives of the people who were responsible for running the affairs of the State were accused of corruption and corrupt practices and failed to establish good governance in the country as a result whereof a large number of references had been filed against the former Prime Minister, Ministers, Parliamentarians and members of the Provincial Assemblies for their disqualification on account thereof. The process of accountability carried out by the former Government was shady, inasmuch as, either it was directed against the political rivals or it was not being pursued with due diligence. All institutions of the State -including Judiciary were being systematically destroyed in the pursuit of self-serving policies. The democratic institutions were not functioning in accordance with the Constitution, they had become privy to the one man rule and the very purposes for which they were established stood defeated by their passive conduct. Attempts were made to politicise the army, destabilise it and create dissension within- its ranks. Had the former Prime Minister been successful in his designs, there would have been chaos and anarchy rather a situation of civil war where some factions of Armed Forces were fighting against others.
(y) Provisional Constitution Order (1 of 1999)---
----Preamble---Proclamation of Emergency by Chief Executive of Pakistan dated 14-10-1999---Constitution of Pakistan (1973), Arts. 91 & 184(3)--?Term "Chief Executive", import of---Constitution of Pakistan (1973) envisages Parliamentary form of Government where the Prime Minister acts as, the Chief Executive of the country---By means of Proclamation of Emergency dated 14-10-1999 as also the Provisional Constitution Order, 1999 the Constitution has been only held in abeyance and the country is to be run as nearly as may be ii-o accordance with the Constitution, therefore, Chairman, Joint Chiefs of Staff Committee and Chief of Army Staff while taking over the affairs of the country assumed to himself the title of "Chief Executive"---Validity---Since practically the Chairman, Joint Chiefs of Staff Committee and Chief of Army Staff was performing the functions of the Prime Minister, he held the position of Chief Executive in the scheme of the Constitution of Pakistan.
The term "Chief Executive" means President where there is a Presidential form of Government and Prime Minister in a Parliamentary form of Government. The Constitution of 1973 envisages Parliamentary form of Government where the Prime Minister acts as the Chief Executive of the country. By means of the Proclamation of Emergency as also the PCO 1 of 1999, the Constitution has only been held in abeyance and the country is to be run as nearly as may be in accordance with the Constitution, therefore, General Pervez Musharraf, while taking over the affairs of the country, assumed to himself the title of "Chief Executive". Since practically, he is performing the functions of the Prime Minister, he holds the position of Chief Executive in the scheme of the Constitution.
Indian Constitutional Law by H.M. Seervai, 4th Edn., p,20; Fazalul Qadir Chaudhry's case PLD 1963 SC 486 and American Constitutional Law, 1995 Edn., p.204 ref.
(z) Provisional Constitution Order (1 of 1999)---
----Preamble---Proclamation of Emergency by Chief Executive of Pakistan dated 14-10-1999---Constitution -of Pakistan (1973), Art.184(3)---Extra ?constitutional step of taking over the affairs of Pakistan by the Armed Forces of Pakistan---Nature---Coup d'etat or revolution---Coup d'etat and revolution are interchangeable in the context of step of taking over the affairs of Pakistan by the Armed Forces and nothing substantial would turn on considering it from one angle or another.
In coup d'etat as well in revolution, power changes from one man to another from one clique to another depending upon the facts and circumstances of each case. Coup d'etat is generally undertaken to achieve a particular objective motivated by various considerations.
In the context of the present case the terms coup d'etat and revolution are interchangeable and nothing substantial would turn on considering it from one angle or another.
Farzand Ali v. Province of West Pakistan PLD 1970 SC 98; Madzimbuto v. Lardner Burke (1968) 3 AER 561; Texas v. White 74 US (7 Wall) 700 (at p. 733), 1868; Madzimbuto v. Lardner Burke 1966 Rhodesian L. Rep. 228 (General Division); Revolution and Political Change by C. Welch and Bunker Taintor; Attorney-General v. Mustafa Ibrahim 1964 Cyprus LR 195 Sup. Ct.; Revolutions, published in the Irish Jurist, 1977 and Begum Nusrat Bhutto v. Chief of the Army Staff PLD 1977 SC 657 ref.
(aa) Provisional Constitution Order (1 of 1999)---
----Preamble---Proclamation of Emergency by Chief Executive of Pakistan dated 14-10-1999---Constitution of Pakistan (1973), Art.184(3)---Extra ?constitutional step of taking over the affairs of Pakistan by the Armed Forces of Pakistan---Validity---Grant of power to Chief Executive of Pakistan to amend the Constitution---Extent---Power of the Chief Executive of Pakistan to amend the Constitution is strictly circumscribed by the limitations laid down by the Supreme Court---Limitations with regard to amendment of the Constitution by Chief Executive of Pakistan as laid down by the Supreme Court enumerated.
If the Parliament cannot alter the basic features of the Constitution, power to amend the Constitution cannot be conferred on the Chief Executive of the measure larger than that which could be exercised by the Parliament. Clearly, unbridled powers to amend the Constitution cannot be given to the Chief Executive even during the transitional period even on the touchstone of `State necessity'. The Constitution of Pakistan is the supreme law of the land and its basic features i.e. independence of Judiciary, federalism and parliamentary form of Government blended with Islamic Provisions cannot be altered even by the Parliament. Resultantly, the power of the Chief Executive to amend the Constitution is strictly circumscribed by the limitations laid down by the Supreme Court.
Mahmood Khan Achakzai's case PLD 1997 SC 426 ref.
Following are the limitations laid down by the Supreme Court with regard to the powers of Chief Executive of Pakistan to amend the Constitution:
(i) The Chairman, Joint Chiefs of Staff Committee and Chief of Army Staff through Proclamation of Emergency, dated the 14th October, 1999, followed by PCO 1 of 1999, whereby he has been described as Chief Executive, having validly assumed power by means of an extra? constitutional step, in the interest of the State and for the welfare of the people, is entitled to perform all such acts and promulgate all legislative measures as enumerated hereinafter, namely:--
(a) All acts or legislative measures which are in accordance with, or could have been made under the 1973 Constitution, including, the power to amend it.
(b) All acts which tend to advance or promote the good of the people.
(c) All acts required to be done for the ordinary orderly running of the State; and
(d) All such measures as would establish or lead to the establishment of the declared objectives of the Chief Executive.
(ii) That Constitutional Amendments by the Chief Executive can be resorted to only if the Constitution fails to .provide a solution for attainment of his declared objectives and further that the power to amend. the Constitution by virtue of clause (6), sub-clause (i) (a) ibid is controlled by sub-clauses (b), (c) and (d) in the same clause.
(iii) That no amendment shall be made in the salient features of the Constitution i.e. independence of Judiciary, federalism, parliamentary form of Government blended with Islamic provisions.
(iv) That Fundamental Rights provided in Part II, Chapter 1 of the Constitution shall continue to hold the field but the State will be authorized to make any law or take any, executive action in deviation of Articles 15, 16, 17, 18, 19 and 24 as contemplated by Article 233 (1) of the Constitution, keeping in view the language of Articles 10, 23 and 25 thereof.
(v) That these acts, or any of them, may be performed or carried out by means of orders issued by the Chief Executive or through Ordinances on his advice;
(vi) That the superior Courts continue to have the power of judicial review to judge the validity of any act or action of the Armed Forces, if challenged, in the light of the principles underlying the law of State necessity as stated above. Their powers under Article 199 of the Constitution, thus, remain available to their full extent, and may be exercised as heretofore, notwithstanding anything to the contrary contained in any legislative instrument enacted by the Chief Executive and/or any order issued by the Chief Executive or by any person or authority acting on his behalf.
(vii) That the Courts are not merely to determine whether there exists any nexus between the orders made, proceedings taken and acts done by the Chief Executive or by any authority or person acting on his behalf, and his declared objectives as spelt out from his speeches, dated 13th and 17th October, 1999, on the touchstone of State necessity but such orders made, proceedings taken and acts done including the legislative measures, shall also be subject to judicial review by the superior Courts.
(bb) Provisional Constitution Order (I of 1999)---
----Preamble---Proclamation of Emergency by Chief Executive of Pakistan dated 14-10-1999---Oath of Office (Judges) Order (1 of 2000), Preamble--?Constitution of Pakistan (1973), Arts.209 & 184(3)---Extra-constitutional step of taking over the affairs of Pakistan by the Armed Forces of Pakistan---Validity---Supreme Judicial Council---Judges of the Supreme Court and High Courts cannot be removed without resorting to the procedure prescribed in Art.209 of the Constitution-Cases of the Judges who ceased to be Judges of the Supreme. Court and High Courts by virtue of Oath of Office (Judges) Order, 2000, however, was hit by the doctrine of past and closed transaction and could not be re-opened.
(cc) Provisional Constitution Order (1 of 1999)---
----Preamble---Proclamation of Emergency by Chief Executive of Pakistan dated 14-10-1999---Constitution of Pakistan (1973), Art.184(3)---Extra ?constitutional step of taking over the affairs of Pakistan by the Armed Forces of Pakistan---Validity---Restoration of democratic institutions---Supreme Court, in view of the circumstances explained by the Attorney-General, observed that there wag no choice but to grant reasonable time to enable the Chief Executive to restore the democratic institutions to the rightful holders of the public representations under the Constitution.
Contention of the Attorney-General was that the Federation intended to restore true representative democracy in the country as early as possible. It was, however, not possible to give specific timeframe for the above, among others, for the reasons that the Authorities/Government require time for:
(a) Revival of country's economy, which stands ruined.
(b) For completion of the process of accountability.
(c) Recovery of huge plundered national wealth including bank loans running into billions of rupees and foreign exchange abroad worth billions of US dollars.
(d) The task of unavoidable electoral reforms including preparation of fresh electoral rolls.
(e) To ensure harmonious and efficient working of the important organs of the State, stable and good governance including maintenance of law and order, to prevent abuse of power, and to ensure and safeguard smooth functioning and enjoyment of democracy by the people.
Supreme Court observed that the Court was not in favour of an Army rule in preference to a democratic rule. There were, however, evils of grave magnitude with the effect that the civilian Governments could not continue to run the affairs of the country in the face of complete breakdown. The remedy to the said evil was the holding of fair and impartial elections by the Chief Election Commissioner at the earliest possible time, but the same could not be achieved till the electoral rolls were updated. Ordinarily, Court would have allowed minimum time for holding of fresh elections as contemplated under the. Constitution, but the Attorney-General made a statement at the Bar that as per report. of the Chief Election Commissioner, updating of the electoral rolls could not be done before two years and thereafter objections and delimitation process etc. were to be attended to. In the absence of proper and authentic electoral rolls, millions of people will be disenfranchised. This statement of the Attorney-General was not rebutted. This being so, there was no choice but to grant reasonable time to enable the Chief Executive to restore the democratic institutions to the rightful holders of the office of public representatives under the Constitution.
(dd) Constitution of Pakistan (1973)---
----Art. 2A---Independence of Judiciary---Extent---Stability in the system, success of the Government, democracy, good governance, economic stability, prosperity of the people, tranquillity, peace and maintenance of law and order depend, to a considerable degree, on the interpretation of Constitution and legislative instruments by the superior Courts and it is, therefore, of utmost importance that the Judiciary was independent and no restraints were placed on its performance and operation---Interpretation of Constitution by superior Courts---Scope and extent.
Stability in the system, success of the Government, democracy, good governance, economic stability, prosperity of the people, tranquillity, peace and maintenance of law and order depend to a considerable degree on the interpretation of Constitution and legislative instruments by the superior Courts. It is, therefore, of utmost importance that the judiciary is independent and no restraints are placed on its performance and operation. It claims and has always claimed that it has the right to interpret the Constitution or any legislative instrument and to say as to what a particular provision of the Constitution or a legislative instrument means or does not mean, even if that particular provision is a provision seeking to oust the jurisdiction of this Court. Under the mandate of the Constitution, the Courts exercise their jurisdiction as conferred upon them by the Constitution or the law. Therefore, so long as the superior Courts exist, they shall continue to exercise powers and functions within the domain of their jurisdiction and shall also continue to exercise power of judicial review in respect of any law or provision of law, which comes for examination before the superior Courts to ensure that all persons are able to live securely under the rule of law; to promote, within the proper limits of judicial functions, the observance and the attainment of human and Fundamental Rights; and to administer justice impartially among persons and between the persons and the State, which is a sine qua non for the maintenance of independence of judiciary and encouragement of public confidence in the judicial system.
(ee) Constitution of Pakistan (1973)---
----Arts. 184 & 199---Judicial review by superior Courts---Powers and scope.
Superior Courts have the right to interpret the Constitution or any legislative instrument and to say as to what a particular provision of the Constitution or a legislative instrument means or does not mean, even if that particular provision is a provision seeking to oust the jurisdiction of Supreme Court. Under the mandate of the Constitution, the Courts exercise their jurisdiction as conferred upon them by the Constitution or the law. Therefore, so long as the superior Courts exist, they shall continue to exercise powers and functions within the domain of their jurisdiction and shall also continue to exercise power of judicial review in respect of any law or provision of law, which comes for examination before the superior Courts to ensure that all persons are able to live securely under the rule of law; to promote, within the proper limits of judicial functions, the observance and the attainment of human and Fundamental Rights; and to administer justice impartially among persons and between the persons and the State, which is a sine qua non for the maintenance of independence of judiciary and encouragement of public confidence in the judicial system.
(ff) Interpretation of statutes-
---- Provision seeking to oust the jurisdiction of Supreme Court--?Interpretation---Power of superior Courts---Scope---Superior Courts have right to interpret the Constitution or any legislative instrument and to say as to what a particular provision of the Constitution or a legislative instrument means or does not mean, even if that particular, provision is a provision seeking to oust the jurisdiction of Supreme Court.
(gg) Constitution of Pakistan (1973) ???????????
----Art. 178---Provisional Constitution Order (1 of 1999), Preamble---Oath of Office of (Judges) Order (1 of 2000), Art.3---Oath of office by Judges of Supreme Court under Provisional Constitution Order, 1999 and Oath of Office of (Judges) Order, 2000---Object and beneficial effects necessitating such oath highlighted.
Fresh oath under Oath of Office (Judges) Order No. l of 2000, does not in any way preclude the Judges of Supreme Court from examining the questions raised in the Constitutional petitions under Article 184(3) of the Constitution of Pakistan (1973), which have to be decided in accordance with their conscience and law so as to resolve the grave crises and avoid disaster by preventing imposition of Martial Law for which the Constitution does not provide any remedy.
New oath of Office was taken by the Judges of Supreme Court under PCO No. l of 1999 read with Oath of Office (Judges) Order No. l of 2000 with 'a view to reiterating the well-established principle that the first and the foremost duty of the Judges of the superior Courts is to save the judicial organ of the State. This was exactly what was done. By virtue of PCO No.l of 1999, the Constitution has not lost its effect in its entirety although its observance as a whole has been interrupted for a transitional period. The activity launched by the Armed. Forces through an extra? Constitutional measure, involves the violation of "some of the rights" protected by the Constitution, which still holds the field but some of its provisions have been held in abeyance. A duty is cast upon the Superior Judiciary to offer some recompense for those rights which were purportedly violated in view of the promulgation of PCO No. 1 of 1999. This could be achieved only by taking the Oath and not by declining to do so and thereby becoming a party to the closure of the Courts, which would not have solved any problem whatsoever but would have resulted in chaos, anarchy and disruption of peaceful life. Independence of judiciary does not mean that Judges should quit their jobs and become instrumental in the closure of the Courts. Indeed, the latter course would have been the most detestable thing to happen. Independence of judiciary means that the contentious matters, of whatever magnitude they may be, should be decided/resolved by the Judges of the superior Courts according to their conscience. This Court, while performing its role as "the beneficial expression of a laudable political realism", had three options open to it in relation to the situation arising out of the military take-over on twelfth day of October, 1999, firstly, it could tender resignation en bloc, which most certainly could be equated with sanctifying (a) chaos/anarchy and (b) denial of access to justice to every citizen of Pakistan wherever he may be; secondly, a complete surrender to the regime by dismissing Constitutional petitions for lack of jurisdiction in view of the purported ouster of its jurisdiction under PCO No. l of 1999 and thirdly, acceptance of the situation as it is, in an attempt to save what "institutional values remained to be saved". Supreme Court, after conscious deliberations and in an endeavour to defend and preserve the national independence, the security and stability of Pakistan, sovereignty and honour of the country and to safeguard the interest of the community as a whole, decided to maintain and uphold the independence of judiciary, which, in its turn, would protect the State fabric and guarantee human rights/Fundamental Rights. It took the Oath under PCO No. l of 1999 so as to secure the enforcement of law, extend help to the law enforcing agencies for maintenance of public order and with a view to restoring democratic institutions, achieving their stability and guaranteeing Constitutional rights to the people of Pakistan.
Oath of Office prescribed under Articles 178 and 194 of the Constitution for the Judges of the superior Courts contains a specific provision that - a Judge shall abide by the Code of Conduct issued by the Supreme Judicial Council. Same is the position with regard to the provisions regarding Oath of Office (Judges) Order No. l of 2000. The precise provisions in the Oath of Office (Judges) Order, 2000 are that a Judge, to whom oath is administered, shall abide by the provisions of Proclamation of Emergency of Fourteenth day of October, 1999, PCO 1 of 1999, as amended, and the Code of Conduct issued by the Supreme Judicial Council. But there is specific omission of words, "to preserve and defend the Constitution". Adherence to the Code of Conduct has not been subjected to any pre-conditions and there can be no deviation from it by a Judge who takes oath either under the Constitution or PCO No. l of 1999 or Oath of Office (Judges) Order 1 of 2000. One of the requirements of the Code of Conduct is that the oath of a Judge implies complete submission to the Constitution, and under the Constitution to the law. Subject to these governing obligations, his function of interpretation and application of the Constitution and the law is to be discharged for the maintenance of the Rule of Law over the whole range of human activities within the nation. Thus, the new Oath merely indicates that the Superior Judiciary, like the rest of the country, had accepted the fact that on 12th October, 1999, a radical transformation took place.
(hh) Provisional Constitution Order (1 of 1999)--
----Preamble---Effect of Provisional Constitution Order, 1999 on the Constitution of Pakistan (1973). '
By virtue of PCO No. 1 of 1999, the Constitution has not lost its effect in its entirety although its observance as a whole has been interrupted for a transitional period. The activity launched by the Armed Forces through an extra-Constitutional measure, involves the violation of "some of the rights" protected by the Constitution, which still holds the field but some of its provisions have been held in abeyance.
(ii) Constitution of Pakistan (1973)-- .
----Art. 2A---Independence of Judiciary means that the contentious matters of whatever magnitude they may be, should be decided/resolved by the Judges of the superior Courts according to their conscience.
Independence of judiciary means that the contentious matters, of whatever magnitude they may be, should be decided/resolved by the Judges of the superior Courts according to their conscience.
(jj) Provisional Constitution Order (1 of 1999)--
----Preamble---Oath of Office (Judges) Order (1 of 2000), Preamble--?Proclamation of Emergency by Chief Executive of Pakistan dated 14-10-1999---Constitution of Pakistan (1973), Art. 184(3)---Constitutional petition under Art. 184(3) of the Constitution of Pakistan (1973) before Supreme Court calling in question the validity of Provisional Constitution Order, 1999 [as amended], Oath of Office (Judges) Order, 2000 and Proclamation of Emergency by Chief Executive of Pakistan dated 14-10-1999---Maintainability---Notwithstanding anything contained in the Proclamation of Emergency dated 14-10-1999, the Provisional Constitution Order, 1999 [as amended] and the Oath of Office (Judges) Order, 2000, all of which purportedly restrained Supreme Court from calling in question or permitting to call in question the validity of any of the provisions thereof, Supreme Court, in the exercise of its inherent powers of judicial review, has the right to examine validity of said instruments---Principles---Constitutional petitions before Supreme Court under Art. 184(3) of Constitution of Pakistan (1973) are therefore, maintainable.
Notwithstanding anything contained in the Proclamation of Emergency of the Fourteenth day of October, 1999, the Provisional Constitution Order No. l of 1999, as amended and the Oath of Office (Judges) Order No. l of 2000, all of which purportedly restrained Supreme Court from calling in question or permitting to call in question the validity of any of the provisions thereof, Supreme Court, in the exercise of its inherent powers of judicial review, has the right to examine the validity of the aforesaid instruments. Additionally, submission of the Federation in response to the Court's notice concerning its own legitimacy, also suggests that Supreme Court has an inherent authority, arising from the submission of both the parties to its jurisdiction, notwithstanding the preliminary objection raised in the written statement as to the maintainability of the Constitutional petitions. In the exercise of its right to interpret the law, Supreme Court has to decide the precise nature of the ouster clause in the above instruments and the extent to which the jurisdiction of the Courts has, been ousted, in conformity with the well-established principles that the provisions seeking to oust the jurisdiction of the superior Courts are to be construed strictly with a pronounced leaning against ouster. The Constitution petitions under Article 184(3) of the Constitution are, therefore, maintainable.
(kk) Provisional Constitution Order (1 of 1999)--.
----Preamble---Proclamation of Emergency by Chief Executive of Pakistan dated 14-10-1999---Constitution of Pakistan (1973), Art.184(3)---Extra ?constitutional step of taking over the affairs of Pakistan by the Armed Forces of Pakistan---Validity---State necessity, doctrine of, and salus populi est suprema lex, principle of---Applicability---Supreme Court, while recording in detail the factors for action by Armed Forces validated the same on the basis of the doctrine of State necessity and the principle of salus populi est suprema lex for a transitional period to prevent any further destabilization, to create corruption-free atmosphere at national level through transparent accountability and revival of economy before restoration of democratic institutions under the Constitution, in that Constitution offered no solution to the prevailing crisis.
National Assembly is the highest representative body, which reflects the will and aspirations of the people of Pakistan. Similar is the status of a Provincial Assembly in a Province. Senate, being a symbol of unity of the federating units has its own utility for the country as a whole. It is, therefore, of utmost importance that the impugned suspension of the above democratic institutions is examined with great care and caution, otherwise it would adversely affect the democratic process in the country, which may cause instability, impair the economic growth and resultantly prove detrimental to the general well-being of the people. However, where the representatives of the people, who are responsible for funning the affairs of the State are themselves accused of? massive corruption and corrupt practices and in the public as well as private sectors are benefiting therefrom and resist establishing good governance; where a large number of references have been filed against the former Prime Minister, Ministers, Parliamentarians and Members of the Provincial Assemblies for their disqualification on account of corruption and corrupt practices; where there is a general perception that corruption is being practised by diversified strata including politicians, Parliamentarians, public officials and ordinary citizens and that a number of Parliamentarians and Members of the Provincial Assemblies misdeclared their assets before Election Commission and Tax Authorities; where there was no political and economic stability and bank loan defaults were rampant and that as per report of Governor, State Bank of Pakistan Rs.356 billion are payable by the bank defaulters up to 12-10-1999, having no accountability and transparency; where economic stability in Pakistan was highly precarious and there was an overall economic slowdown as GDP growth during the past three years had hardly kept pace with the growth of population; where Pakistan has a debt burden, which equals the country's entire national income; where all the institutions of the State were being systematically destroyed and the economy was in a state of collapse due to self-serving policies of the previous Government, which had threatened the existence, security, economic life, financial stability and credit of Pakistan; where a situation had arisen under which the democratic institutions were not functioning in accordance with the provisions of the Constitution, inasmuch as, the Senate and the National and Provincial Assemblies were closely associated with the former Prime Minister and there was no real democracy because the country was, by and large, under one man rule; where an attempt was made to politicize the Army, destabilize it and create dissension within its ranks and where the judiciary was ridiculed, leaving no stone unturned to disparage and malign it by making derogatory and contemptuous. speeches by some of the members of the previous ruling party inside and outside the Parliament and no Reference was made to the Chief Election Commissioner for their disqualification as members of the Parliament under Article 63(2) of the Constitution; where the disparaging remarks against the judiciary crossed all limits with the rendering judgment by this Court in the case of Sh. Liaquat Hussain v Federation of Pakistan PLD 1999 SC 504, declaring the establishment of Military, Courts as ultra vires of the Constitution. which resulted into a slanderous campaign against the judiciary launched by the former Primc. Minister registering his helplessness in the face of the Judiciary not allowing him the establishment of Military Courts as. a mode of speedy justice; where the image of the judiciary' was tarnished under a well-conceived design; where the telephones of the Judges of the superior Courts and other personalities were tapped in spite of the law laid down by this Court in the case of Mohtarma Benazir Bhutto v. President of Pakistan PLD 1999 SC 388, 'that tapping of telephones and eaves-dropping was immoral, illegal and unconstitutional; where storming of the Supreme Court was resorted to allegedly by some of the leaders and activists of the Pakistan Muslim League which ultimately- led to the issuance of contempt notices against them/contemners by the Full Bench of Supreme Court in a pending appeal; where Mian Nawaz Sharif's Constitutional and moral authority stood completely eroded and where situation was somewhat similar and analogous to the situation that was prevalent to July, 1977, the extra-Constitutional step of taking over the affairs of the country by the Armed Forces for a transitional period to prevent any further destabilization, to create corruption-free atmosphere at national level through transparent accountability and revive the economy before restoration of democratic institutions under the Constitution, is validated, in that, the Constitution offered no solution to the present crisis.
Probably, the situation could have been avoided if Article 58(2)(b) of the Constitution (1973) had been in the field, which maintained parliamentary form of Government and had provided checks and balances between the powers of the President and the Prime Minister to let the system run without any let or hindrance to forestall the situation in which Martial Law can be imposed. With the repeal of Article 58(2)(b) of the Constitution, there was no remedy provided in the Constitution to meet the situation like the present one with which the country was confronted, therefore, Constitutional deviation made by the Chief of the Army Staff, for the welfare of the people rather than abrogating the Constitution or imposing Martial Law by means of an extra-Constitutional measure is validated for a transitional period on ground of State necessity and on the principle that it is in public interest to accord legal recognition to the present regime with a view to achieving his declared objectives and that it is in the interest of the community that order be preserved. Legal recognition/legitimacy can be accorded to the present regime also on the principle that the Government should be by the consent of the governed, whether voters or not. Here there is an implied consent of the governed i.e. the people of Pakistan in general including politicians/parliamentarians, etc. to the Army take-over, in that, no protests worth the name or agitations have been launched against the Army take-over and/or its continuance. The Court can take judicial notice of the fact that the people of Pakistan have generally welcomed the Army take?over due to their avowed intention to initiate the process of across the board and transparent accountability against those, alleged of corruption in every walk of life, of abuse of national wealth and of not taking appropriate measures for. stabilizing the economy and democratic institutions. Another principle, which is attracted is that since an extra-Constitutional action has been taken by General Pervez Musharraf wielding effective political power, it is open to the Court to steer a middle course so as to ensure that the framework of the pre-existing Order survives but the Constitutional deviation therefrom be justified on the principle of necessity, rendering lawful what would otherwise be unlawful. However, prolonged involvement of the Army in civil affairs runs a grave risk of politicizing it, which would not be in national interest, therefore, civilian rule in the country must be restored within the shortest possible time after achieving the declared objectives, which necessitated the military take-over and Proclamation of Emergency as spelt out from the speeches of the Chief Executive, dated 13th and 17th October, 1999. The acceptance of the above principles do not imply abdication from judicial review in the transient suspension of the previous legal order.
Sh. Liaquat Hussain v. Federation of Pakistan PLD 1990 SC 504 and Benazir Bhutto v. President of Pakistan PLD 1998 SC 388 ref.
?(ll) Provisional Constitution Order (1 of 1999)--
----Preamble---Proclamation of Emergency by Chief Executive of Pakistan dated 14-10-1999---Constitution.of Pakistan (1973), Arts.184(3) & 199 Extra-constitutional step of taking over the affairs of Pakistan by the Armed Forces of Pakistan---Validity---Powers of superior Courts---Scope and extent---Situation in the country having arisen for which the Constitution had provided no solution and the intervention by the Armed Forces through an extra-constitutional measure having become inevitable, Supreme Court validated the measures taken by Armed Forces including all past and closed transactions, as well as such executive actions as were required for the orderly running of the State and all acts which tended to advance or promote the good of the people on the basis of State necessary and the principle of salus populi est suprema lex as embodied in Begum Nusrat Bhutto's case reported as PLD 1977 SC 657---Chief Executive of Pakistan having validly assumed power by means of an extra-constitutional step, in the interest of the State and for the welfare of the people, was entitled to perform all such acts and promulgate all legislative measures as indicated by the Supreme Court---Superior Courts, however, continue to have the power of judicial review to judge the validity of any act or action of the Armed Forces, if challenged, in the light of the principles underlying the law of State necessity---Powers of superior Courts under Art.199 of the Constitution of Pakistan (1973), thus, remained available to their full extent, and may be exercised as heretofore, notwithstanding anything to the contrary contained in any legislative instrument enacted by the Chief Executive and/or am order issued by the Chief Executive or by any person or Authority acting on his behalf---Courts were not merely to determine whether there existed any nexus between the orders made, proceedings taken and acts done by the, Chief Executive or by any Authority or person acting on his behalf, and his declared objectives as spelt out from his speeches dated 13th and 17th October., 1999, on the touchstone of State necessity but orders made, proceedings taken and acts done including the legislative measures, shall also be subject to judicial review by the superior Courts---Rule laid down by Supreme Court for validation of action of Armed Forces on 12-10-1999 detailed.
Following is the text of rule laid down by the Supreme Court while validating the action of taking over the affairs of Pakistan by the Armed Forces of Pakistan on 12th October, 1999:
"1. On 12th October, 1999 a situation arose for- which the Constitution provided no solution and the intervention by the Armed Forces through an extra-Constitutional measure became inevitable, which is hereby validated on the basis of the doctrine of State necessity and the principle of salus populi est suprema lex as embodied in Begum Nusrat Bhutto's case. The doctrine of State necessity is recognised not only in Islam and other religions of the world but also accepted by the eminent international jurists including Hugo Grotius, Chitty and de Smith and some superior Courts from foreign jurisdiction to fill a political vacuum and bridge the gap.
Sufficient corroborative and confirmatory material has been produced by the Federal Government in support of the intervention by the Armed Forces through extra-Constitutional measure. The material consisting of newspaper clippings, writings, etc. in support of the impugned intervention is relevant and has been taken into consideration as admissible material on the basis of which a person of ordinary prudence would conclude that the matters and events narrated therein did occur. The findings recorded herein are confined to the controversies involved in these cases alone. ???????????
All past and closed transactions, as well as such executive actions as were required for the orderly running of the State and all acts, which tended to advance or promote the good of the people are also validated.
That the 1973 Constitution still remains the supreme law of the land subject to the condition that certain parts thereof have been held in abeyance on account of State necessity.
That the superior Courts continue to function under the Constitution. The mere fact that the Judges of the superior Courts have taken a new bath under the Oath of Office (Judges) Order No. l of 2000, does not in any manner derogate from this position, as the Courts had been originally established under the 1-973 Constitution, and have continued in their functions in spite of the Proclamation of Emergency and PCO No. l of 1999 and other legislative instruments issued by the Chief Executive from time to time.
6.(i) That the Chairman, Joint Chiefs of Staff Committee and the Chief of the Army Staff through Proclamation of Emergency dated the 14th October, 1999, followed by PCO 1 of 1999, whereby he had been described as Chief Executive; having validly assumed power by means of an extra ?Constitutional step, in the interest of the State and for the welfare of the people, was entitled to perform all such acts and promulgate all legislative measures as enumerated hereinafter, namely:--
(a) All acts or legislative measures which. were in accordance with, or could have been made under the 1973 Constitution, including the power to amend it;
(b) All acts which tended to advance or promote the good of the people;
(c) All acts required to be done for the ordinary orderly running of the State; and
(d) All such measures as would establish or lead to the establishment of the declared objectives of the Chief Executive.
(ii) That Constitutional amendments by the Chief Executive could be resorted to only if the Constitution failed to provide a solution for attainment of his declared objectives and further that the power to amend the Constitution by virtue of clause (6), sub-clause (i) (a) (ibid) was controlled by sub-clauses (b), (c) and (d) in the same clause.
(iii) That no amendment shall be made in the salient features of the Constitution i.e. independence of judiciary, federalism, parliamentary form of Government blended with Islamic provisions.
(iv) That Fundamental Rights provided in Part II, Chapter 1 of the Constitution shall continue to hold the field but the State will be authorized to make any law or take any executive action in deviation of Articles 15, 16, 17, 18, 19 and 24 as contemplated by Article 233(1) of the Constitution, keeping in view the language of Articles 10, 23 and 25 thereof.
(v) That these acts; or any of them, may be performed or carried out by means of orders issued by the Chief Executive or through Ordinances on his advice;
(vi) That the superior Courts continue to have the power of judicial review to judge the validity of any act or action of the Armed Forces, if challenged, in the light of the principles underlying the law of State? necessity as stated above. Their powers under Article 199 of the Constitution, thus, remain available to their full extent, and may be exercised as heretofore, notwithstanding anything to the contrary contained in any legislative instrument enacted by the Chief Executive and/or any order issued by the Chief Executive or by any person or authority acting on. his behalf.
(vii) That the Courts are not merely to determine whether there exists any nexus between the orders made, proceedings taken and acts done by the Chief Executive or by any authority or person acting on his behalf, and his declared objectives as spelt out from his speeches, dated 13th and 17th October, 1999, on the touchstone of State necessity but such orders made, proceedings taken and acts done including the legislative measures, shall also be subject to judicial review by the superior Courts.
7.???????? That the validity of the National Accountability Bureau Ordinance, 1999 will be examined separately in appropriate proceedings at appropriate stage.
That the cases of learned former Chief Justice and Judges of the Supreme Court, who had not taken oath under the Oath of Office (Judges) Order, 2000 (Order 1 of 2000), and those Judges of the Lahore High Court, High Court of Sindh and Peshawar High Court, who were not given oath, cannot be re-opened being hit by the doctrine of past and closed transaction.
That the Government shall accelerate the process of accountability in a coherent and transparent manner justly, fairly, equitably and in accordance with law.
That the Judges of the superior Courts are also subject to accountability in accordance with the methodology laid down in Article 209 of the Constitution.
General Pervez Musharraf, the Chief of the Army Staff and. the Chairman, Joint Chiefs of Staff Committee is a holder of Constitutional post. His purported arbitrary removal in violation of the principle of audi alteram partem was ab initio void and of no legal effect.
That this order will not affect the trials conducted and convictions recorded including proceedings for accountability pursuant to various orders made and Orders/laws promulgated by the Chief Executive or any person exercising powers or jurisdiction under his authority and the pending trials/proceedings may continue subject to this order.
This is not a case where old legal order has been completely suppressed or destroyed, but merely a case of Constitutional deviation for a transitional period so as to enable the Chief Executive to achieve his declared objectives.
That the current electoral rolls are outdated. Fresh elections cannot be held without updating the electoral rolls. The learned Attorney-General states that as per report of the Chief Election Commissioner this process will
take two years. Obviously, after preparation of the electoral rolls some time is required for delimitation of constituencies and disposal of objections, etc.
disenfranchisement of millions of people of Pakistan in violation of Articles 17 and 19 of the Constitution. Even MQM also resorted to a similar Constitution Petition bearing No.53 of 1996 seeking the same relief. However, for reasons best known to the petitioners in both the petitions, the same were not pursued any further.
That having regard to all the relevant factors involved in the case including the one detailed in paragraphs 14 and 15 above, three years' period is allowed to the Chief Executive with effect from the date of the' Army take-over i.e. 12th October, 1999 for achieving his declared objectives.
That the Chief Executive shall appoint a date, not later than 90 days before the expiry of the, aforesaid period of three years, for holding of general elections to the National Assembly and the Provincial Assemblies and the Senate of Pakistan.
That this Court has jurisdiction to review/re-examine the continuation of the Proclamation of Emergency dated 12th October, 1999 at any stage if the circumstances so warrant as held by this Court in the case of Sardar Farooq Ahmed Khan Leghari v. Federation of Pakistan PLD 1999 SC 57."
(mm) State necessity, doctrine of---
----Doctrine of State necessity is recognised not only in Islam and other religions of the world but also accepted by the eminent international jurists to fill a political vacuum and bridge the gap.
(nn) Maxim:
----"Salus populi est suprema lex"----Applicability.
(oo) Provisional Constitution Order (1 of 1999)---
----Preamble---Proclamation of Emergency by Chief Executive of Pakistan dated 14-10-1999---Oath of Office (Judges) Order (1 of 2000), Preamble--?Effect of Provisional Constitution Order, 1999; Proclamation of Emergency by Chief Executive of Pakistan dated 14-10-1999 and Oath of Office (Judges) Order, 2000 was that Constitution of Pakistan (1973) still remained the supreme law of the land subject to the condition that certain parts thereof had been held in abeyance on account of State necessity.
(pp) Constitution of Pakistan (1973)---
----Arts. 175 & 184(3)---Provisional Constitution Order (1 of 1999), Preamble---Proclamation of Emergency by Chief Executive of Pakistan dated 14-10-1999---Oath of Office (Judges) Order (1 of 2000), Preamble---Constitution of Pakistan (1973), Preamble and Art.184(3)---Oath of Judges of superior Courts under Oath of Office (Judges) Order, 2000---Effect--?Powers of superior Courts---Superior Courts continued to function under the Constitution of Pakistan (1973)---Mere fact that the Judges of the superior Courts had taken a new oath under the Oath of Office (Judges) Order, 2000 did not in any manner derogate from the said position, as the Courts had been originally established under the Constitution of Pakistan (1973,) and had continued their functions in spite of the Proclamation of Emergency by the Chief Executive of Pakistan and Provisional Constitution Order, 1999 and other legislative instruments issued by the Chief Executive from time to time.
(qq) Provisional Constitution Order (1 of 1999)---
----Preamble---Proclamation of Emergency by Chief Executive of Pakistan dated 14-10-1999---Oath of Office (Judges) Order (1 of 2000), Preamble--?Constitution of Pakistan (1973), Preamble and Art. 184(3)---Powers of Chief Executive of Pakistan---Scope and extent---Judicial review of powers of the Chief Executive of Pakistan by superior Courts---Scope---Chief Executive of Pakistan having validly assumed power by. means of an extra-constitutional step, in the interest of the -State and for the welfare of the people, was entitled to perform all such acts and promulgate all legislative measures as indicated by Supreme Court---Superior Courts, however, continue to have the power of judicial review to judge the validity of any act or action of the Armed Forces, if challenged; in the light of the principles underlying the law of State necessity---Powers of superior Courts under Art. 199 of the Constitution of Pakistan (1973), thus, remained available to their full extent, and may be exercised as heretofore, notwithstanding anything to the contrary contained in any legislative instrument enacted by the Chief Executive and/or any order issued by the Chief Executive or by any person or authority acting on his behalf---Courts were not merely to determine whether there existed any nexus between the orders made; proceedings taken and acts done by the Chief Executive or by any Authority or person acting on his behalf, and his declared objectives as spelt out from his speeches dated 13th and 17th October, 1999, on the touchstone of State necessity but orders made, proceedings taken and acts done including the legislative measures, shall also be subject to judicial review by the superior Courts.
The Chairman, Joint Chiefs of Staff Committee and the Chief of Army Staff through Proclamation of Emergency dated the 14th October, 1999, followed by PCO 1 of 1999, whereby he had been described as Chief Executive, having validly assumed power by means of an extra ?Constitutional step, in the interest of the State and for the welfare of the people, was entitled to perform all such acts and promulgate all legislative measures as enumerated hereinafter, namely:--
(a) All acts or legislative measures which were in accordance with, or could have been made under the 1973 Constitution, including the power to amend it;
(b) All acts which tended to advance or promote . the good of the people;
(c) All acts required to be done for the ordinary orderly running of the State; and
(d) All such measures as would establish or lead to the establishment of the declared objectives of the Chief Executive.
(ii) That Constitutional amendments by the Chief Executive could be resorted to only if the Constitution failed to provide a solution for attainment of his declared objectives and -further that the power to amend the Constitution by virtue of clause (6), sub-clause (i) (a) (ibid) was controlled by sub-clauses (b), (c) and (d) in the same clause.
(iii) That no amendment shall be made in the salient features of the Constitution i.e. independence of judiciary, federalism, parliamentary form ,of Government blended with Islamic provisions.
(iv) That Fundamental Rights provided in Part II, Chapter I of the Constitution shall continue to hold the field but the State will be authorized to make any law or take any executive action in deviation of Articles 15, 16, 17, 18, 19 and 24 as contemplated by Article 233(1) of the Constitution, keeping in view the language of Articles 10, 23 and 25 thereof.
(v) That these acts, or any of them, may be performed or carried out by means of orders issued by the Chief Executive or through Ordinances on his advice;
(vi) That the superior Courts continue to have the power of judicial review to judge the validity of any act 'or action of the Armed Forces, if challenged, in the light of the principles underlying the law of State necessity as stated above. Their powers under Article 199 of the Constitution, thus, remain available to their full extent, and may be exercised as heretofore, notwithstanding -anything to the contrary contained in any legislative instrument enacted by the Chief Executive and/or any order issued by the Chief Executive or by any person or authority acting on his behalf.
(vii). That the Courts are not merely to determine whether there exists any nexus between the orders made, proceedings taken and acts done by the Chief Executive of by any authority or person acting on his behalf, and his declared objectives as spelt out from his speeches, dated 13th and 17th October, 1999, on the touchstone of State necessity but such orders made, proceedings taken and acts done including the legislative measures, shall also be subject to judicial review by the superior Courts.
(rr) Provisional Constitution Order (1 of 1999)---
----Preamble---Proclamation of Emergency by Chief Executive of Pakistan dated 14-10-1999---Oath of Office (Judges) Order (1 of 2000), Preamble--?Validation of Proclamation of Emergency dated 14-10-1999 in continuation of Emergency proclaimed on 28-5-1998---Proclamation of Emergency dated 28th May, 1998 issued under Art.232(1) of Constitution of Pakistan (1973) and Proclamation of Emergency dated 14-10-1999 issued by Chief Executive by way of an extra-constitutional step as a follow up of the Army take-over stood validated notwithstanding the continuance of the Emergency proclaimed on 28th May, 1998 still held the field.
(ss) Provisional Constitution Order (1 of 1999)---
----Preamble---Proclamation of Emergency by Chief Executive of. Pakistan dated 14-10-1999---Oath of Office (Judges) Order (1 of 2000), .Preamble--?Constitution of Pakistan (1973), Preamble, Arts.209 & 184(3)---Past and closed transaction, doctrine of---Applicability---Cases of former Chief Justice and Judges of Supreme Court who had not taken oath under the Oath of Office (Judges) Order, 2000 and those Judges of the Lahore High Court, High Court of Sindh and Peshawar High Court, who were not given oath, could not be reopened being hit by the doctrine of past and closed transaction.
The cases of former Chief Justice and Judges of the Supreme Court, who had not taken oath under the Oath of. Office (Judges) Order, 2000 (Order 1 of 2000), and those Judges of the Lahore High Court, High Court of Sindh and Peshawar High Court; who were not given oath, cannot be reopened, being hit by the doctrine of past and closed transaction.
The practical effect of the above observation is that the action of the Chief Executive in this behalf has been validated. It is a well-settled principle that in such situations the Court may refuse relief in respect of a particular decision, but go on to determine the general question of law or interpretation that the case raises. Clearly, the Judges of the Superior Judiciary enjoy constitutional guarantee against arbitrary removal. They can be removed only by following the procedure laid down in Article 209 of the Constitution by filing an appropriate reference before the Supreme Judicial Council and not otherwise. The validity of the action of the Chief Executive was open to question on the touchstone of Article 209 of the Constitution. But none of the Judges took any remedial steps and accepted pension as also the right to practise law and thereby acquiesced in the action. Furthermore, the appropriate course of action for Supreme Court in these proceedings would be to declare the law to avoid the recurrence in future, but not to upset earlier actions or decisions taken in this behalf by the Chief Executive, these being past and closed transactions. The Courts can refuse relief in individual cases even though the action is flawed, depending upon the facts and circumstances of each case. The action of Chief Executive in the context given above has not encroached on the judicial power or impaired it in the process. However, the observations made herein as to the declaration of law under Article 209 of the Constitution would not entitle the relevant authorities or Supreme Court to reopen the cases of the above Judges which have become final.
The Judges of the Supreme Court and High Courts cannot be removed without resorting to the procedure prescribed in Article 209 of the Constitution, but the cases of Judges who ceased to be Ridges of the Supreme Court and High Courts by virtue of Oath of Office (Judges) Order, 2000 (Order 1 of 2000) is hit by the doctrine of past and closed transaction and cannot be reopened.
(tt) Constitution of Pakistan (1973)---
----Arts. 209 & 184(3)---Provisional Constitution Order (1 of 1999), Preamble---Proclamation of Emergency by Chief Executive of Pakistan dated 14-10-1999---Oath of Office (Judges) Order (1 of 2000), Preamble--?Constitution of Pakistan (1973), Preamble and Arts.184(3) & 209--?Accountability, process of---Government shall accelerate the process of accountability in a coherent and transparent manner justly, fairly, equitably and in accordance with law---Judges of superior Courts were subject to accountability only in accordance with the methodology laid down in Art.209 of the Constitution of Pakistan (1973).
(uu) Constitution of Pakistan (1973)---
----Arts. 243 & 184(3)---Command of Armed Forces---Removal of Chief of the Army Staff and Chairman, Joint Chiefs of Army Staff Committee--?Procedure---Chief of the Army Staff and Chairman, Joint Chiefs of Army. Staff Committee being a holder of constitutional post, his arbitrary removal in violation of the principle of audi alteram partem was ab initio void and of no legal effect.
(vv) Provisional Constitution Order (1 of 1999)---
----Preamble---Proclamation of Emergency by Chief Executive of Pakistan dated 14-10-1999---Oath of Office (Judges) Order (1 of 2000), Preamble--?Constitution of Pakistan (1973), Preamble and Art.184(3)---Validity of extra-constitutional step of taking over the affairs of Pakistan by the Armed Forces accorded by Supreme Court---Effect---Order of Supreme Court validating the extra-constitutional step of taking over the affairs of the country by the Armed Forces and rules laid down in the said order will not affect the trials conducted and convictions recorded including proceedings for accountability pursuant to various orders made and orders/laws promulgated by the Chief Executive of Pakistan or any person exercising powers or jurisdiction under his authority and the pending trials/proceedings may continue subject to the present order of validation by the Supreme Court.
(ww) Provisional Constitution Order (1 of 1999)---
----Preamble---Proclamation of Emergency by Chief Executive of Pakistan dated 14-10-1999---Oath of Office (Judges) Order (1 of 2000), Preamble--?Constitution of Pakistan (1973), Preamble and Art.184(3)---Extra?constitutional step of taking over the affairs of Pakistan by the Armed Forces of Pakistan---Effect---Effect of action of Armed Forces was not that legal order in the country had been completely suppressed or destroyed, but it was merely a Constitutional deviation for a transitional period so as to enable the Chief Executive of Pakistan to achieve his declared objectives.
(xx) Constitution of Pakistan (19'73)---
----Arts. 224 & 184(3)---Provisional Constitution Order (1 of 1999), Preamble---Proclamation of Emergency by Chief Executive of Pakistan dated 14-10-1999---Extra-constitutional step of taking over the affairs of Pakistan by the Armed Forces of Pakistan---Validity---Elections---Time frame---Current electoral rolls being outdated, fresh elections. could not be held without updating ,the electoral rolls and after preparation of the electoral rolls as some time was required for delimitation of constituencies and disposal of objections etc.---Supreme Court, after having regard to all the relevant factors involved allowed three years' period to the Chief Executive of Pakistan with effect from the date of the Army take-over i.e. 12-10-1999 for achieving his declared objectives---Chief Executive of Pakistan shall appoint a date, not later than 90 days before the expiry of three years, for holding a general election to the National Assembly and the Provincial Assemblies and the Senate of Pakistan.
(yy) Provisional Constitution Order (1 of 1999)---
----Preamble---Proclamation of Emergency by Chief Executive of Pakistan dated 14-10-1999---Oath of Office (Judges) Order (1 of 2000), Preamble--?Constitution of Pakistan (1973), Preamble and Art. 184(3)---Extra? constitutional step of taking over the affairs of Pakistan by the Armed Forces of Pakistan---Validity---Jurisdiction to review/re-examine by Supreme Court the continuation of Proclamation of Emergency. dated 12-10-1999---Scope--?Supreme Court having validated the extra-Constitutional step of taking-over the affairs of the country by the Armed Forces subject to rules laid down in the validating order, had jurisdiction to review/re-examine the continuation of Proclamation of Emergency dated 12-10-1999 at any stage, if the circumstances so warrant.
Sardar Farooq Ahmed Khan Leghari v. Federation of Pakistan PLD 1999 SC 57 ref.
??????????? Ahmad Saeed Karmani's case PLD 1956 (W.P) Lah.807; Darvesh M. Arbey's case PLD 1977 Lah.846; Iqbal Ahmad Khan's case PLD 1977 Lah.337; Muhammad Bachal Memon's case PLD 1987 Kar.296; Muhammad Naeem Akhtar's case 1992 CLC 2043; Shams-ud-Din's case 1994 MLD 2500; Manzoor Ahmed Wattoo's case PLD 1997 Lah.38; Muhammad Anwar Durrani's case PLD 1989 Quetta 25; A.K. Fazalul Quader Chaudhry's case PLD 1966 SC 105; Pit Sabir Shah's case PLD 1994 SC 738; Tfie Speaker, Balochistan Provincial Asembly, Quetta's case PLD 1996 SCMR-1969; Mrs. Shahida Zahir Abbassi's case PLD 1996 SC 632; Mahmood Khan Achakzai's case PLD 1997 SC 426; Wukala Mahaz Barai Tahafaz-e-Dastoor's case PLD 1998 SC 1263; Sardar Farooq Ahmed Khan Leghari's case PLD 1999 SC 57; Syed Jalal Mehmood Shah's case PLD 1999 SC 395; Sh. 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The Commissioner of Income-tax, Investigation, Lahore PLD 1989 SC 613; Mst. Kaneez Fatima v. Wali Muhammad PLD 1993 SC 901; Fazle Ghafoor v. Chairman, Tribunal of Disputes, Dir, Swat at Chitral at Mardan 1993 SCMR 1073; Ghulam Hamdani. v. Muhammad Iqbal 1993 SCMR 1083; M. Ismail Qureshi v. M. Awais Qasim 1993 SCMR 1781; Zaheeruddin v. The State 1993 SCMR 1718; Brig. Retd. Imtiaz Ahmad v. Government of Pakistan through Secretary, Interior Division 1994 SCMR 2142; Speech of the Chief Executive dated 17-10? 1999; Mokotso v. H.M. King Moshoehoe II 1989 LRC (Const.) 24; Mitchell v. Director of Public Prosecutions 1986 LRC (Const.) 35; Hamza Shehbaz Sharif v. Federation of Pakistan 1999 PCr.LJ 1584; Huddaibia Engineering v. Pakistan PLD 1998 Lah. 90; Mushtaq Ahmed Gormani v. State PLD 1958 SC 333; Amanullah Khan v. Federal Government of Pakistan PLD 1990 SC 1092; M. Inayat Khan v. M. Anwar and 2 others PLD 1976 SC 354; Ex-Major-General Akbar Khan v. The Crown PLD 1954 FC 87; F.B. Ali v. 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Ch. Muhammad Farooq, Senior Advocate Supreme Court and S. Abul Aasim Jafri, Advocate-on-Record for Petitioner (in C.P. No. 62 of 1999). .
Khalid Anwar, Senior Advocate Supreme Court, M Rafique Rajwana, Advocate Supreme Court, Umar Bandial, Advocate Supreme Court, Ms. Saadia Abbasi, Advocate and S. Abul Aasim Jafri. .Advocate-on?-Record for Petitioners (in C.P. No. 63 of 1999).
Habibul Wahabul Khairi, Advocate Supreme Court for Petitioner (in C.P. No. 53 of 1999).
Petitioner in person (in C.P. No.57 of 1999).
Fazal Illahi Siddiqui, Advocate Supreme Court for Petitioner (in C.P. No.. 3 of 2000).
Petitioner in person (in C.P. No. 66 of 1999).
Petitioner in person (in C.P. No. 64 of 1999).
Aziz A. Munshi, Attorney-General for Pakistan, Syed Sharifuddin Pirzada, Senior Advocate Supreme Court, Tanvir Bashir Ansari, Deputy Attorney-General, Mansur Ahmad, Deputy Attorney-General, S.A. Mannan, Advocate Supreme Court, Sh. Maqbool Ahmad, Advocate Supreme Court, Ch. Bashir Ahmad, Advocate Supreme Court, Ch. Fazle Hussain, Advocate-on-Record, Mehr Khan Malik, Advocate-on-Record and Waqar Rana, Advocate for Respondent (Federation).
M. Ashraf Khan Tanoli, Advocate-General, Balochistan, M.Younis Khan Tanoli, Advocate-General, N.-W.F.P., Maqbool Illahi Malik, Advocate-General, Punjab, Nasim Sabir, Additional Advocate-General, Punjab, Tariq Mahmood Khokhar, Additional Advocate-General, Punjab, Rao M. Yousuf Khan, Advocate-on-Record, Raja Qureshi, Advocate?General, Sindh, Abdul Haleem Pirzada, President, Supreme Court Bar Association, Kadir Bakhsh Bhutto, Vice-Chairman, Pakistan Bar Council and Dr. Farooq Hassan for President, Lahore High Court Bar Association (on Court's Notice).
S.M. Zafar, Senior Advocate Supreme Court assisted by Syed Ali Zafar, Advocate Supreme Court, Haider Zaman Qureshi and Raja Zafar Khalid, Advocates: Amicus curiae.
Dates of hearing: 1st November, 6th December, 1999; 31st January, 1st to 3rd March; 6th to 10th, 13th, 14th, 22nd, 24th March; 1st to 5th and 8th to 12th May, 2000.
JUDGMENT
IRSHAD HASAN KHAN, CJ.---Through this common judgment we propose to dispose of Constitution Petitions Nos. 62 to 64, 66, 53, 57, of 1999 and Constitution Petition No. 3 of 2000, challenging the validity and legal effect of the army take-over, the issuance of Proclamation of Emergency (hereinafter referred to as the Proclamation) and promulgation of Provisional Constitution Order No. 1 of 1999 (hereinafter referred to as the PCO) and the Oath of Office (Judges) Order, 2000 (hereinafter called the Order I -of 2000). Some of the Constitution Petitions, fully or partly, support the army take-over, the Proclamation, the PCO and the Order I of 2000.
The above petitions raise questions of great public importance and of far reaching consequences..
Ch. Muhammad Farooq, learned Senior ASC, for the petitioner in C.P. No. 62 of 1999, Mr. Khalid Anwar, learned Senior ASC, for the petitioners in C.P. No. 63 of 1999, Mr. Habib-ul-Wahabul Khairi, learned ASC, petitioner in C.P. No. 53 of 1999, Syed Iqbal Haider, petitioner in C.P.No. 57 of 1999, Mr. Shahid Orakzai, petitioner in C.P. No. 64 of 1999, Syed Imtiaz Hussain Bukhari, petitioner in C.P. No. 66 of 1999 and Mr. Fazal Illahi Siddiqui, learned ASC, petitioner in C.P. No. 3 of 2000 as well as Mr. Aziz A. Munshi, learned Attorney-General for Pakistan; Syed Sharifuddin Pirzada, learned Senior ASC for the Federation; Mr Abdul Haleem Pirzada, President, Supreme Court Bar Association; Dr. Farooq Hasan for President, Lahore High Court Bar Association; Mr. Kadir Bakhsh, Vice-Chairman, Pakistan Bar Council; Advocates-General of the Provinces and Mr. S.M. Zafar, learned Senior ASC as amicus curaie have addressed elaborate arguments as to the validity or otherwise and legal effect of the army take-over by General Pervez Musharraf. The parties have also filed voluminous documents on the factual aspects of the case and set out their respective versions of the events culminating in the army take-over, issuance of the Proclamation on 12th October, 1999 and other legal instruments referred to above. , 4. Facts of the case, briefly stated, are that the Chairman Joint Chiefs of Staff Committee and Chief of Army Staff General Pervez Musharraf on 12-10-1999 seized power in Pakistan by dismissing the Government of the then Prime Minister Mian Muhammad Nawaz Sharif, putting him under house arrest, on charges of interfering in the affairs of the Armed Forces, politicising the Army, destabilising it and trying to create dissension within its ranks. He briefly addressed the nation on radio and television at 3-00 a.m. on 13-10-1999. The text of the Chief of Army Staff's speech reads thus:
TEXT OF THE COAS SPEECH
"My dear countrymen, Assalam-o- Alaikum.
You are all aware of the kind of turmoil and uncertainty that our country has gone through in recent times. Not only have all the institutions been played around with, and systematically destroyed, the economy too is in a state of collapse. We are also aware of the self-serving policies being followed, which have rocked the very foundation of the Federation of Pakistan.
The armed forces have been facing incessant public clamour to remedy the fast declining situation from all sides of the political divide. These concerns were always conveyed to the Prime Minister in all sincerity, keeping the interest of the country foremost. It is apparent that they were never taken in the correct, spirit. My singular concern has been the well-being of our country alone. This has been the sole reason that the army willingly offered its services for nation building tasks, the results of which have already been judged by you.
All my efforts and counsel to the Government it seems were to no avail. Instead they now turned their attention on the army itself. Despite all my advices they tried to interfere with the armed forces, the last remaining viable institution in which all of you take so much pride and look up to, at all times, for the stability, unity and integrity of our beloved country. Our concerns again were conveyed in no uncertain terms but the Government of Mr. Nawaz Sharif chose to ignore all these and tried to politicize the army, destabilize it and tried to create dissension within its ranks.
I was in Sri Lanka on an official visit. On my way back the PTA commercial flight was not allowed to land at Karachi but was ordered to be diverted to anywhere outside Pakistan, despite acute shortage of fuel, imperiling the life of all the passengers. Thanks to Allah, this evil design was thwarted through speedy army action.
My dear countrymen having briefly explained the background, I wish to inform you that the armed forces have moved in as a last resort, to prevent any further destabilization. I have done so with all sincerity, loyalty and selfless devotion to the country with the armed forces firmly behind me. I do not wish to make a lengthy policy statement at this moment. I shall do that very soon. For the moment I only wish to assure you that the situation in the country is perfectly calm, stable and under control. Let no outside forces think they can take advantage of the prevailing situation.
Dear brothers and sisters, your armed forces have never and shall never let you down, Inshallah, we shall preserve the integrity and sovereignty of our country to the last drop of our blood. I request you all, to remain calm and support your armed forces in the re?establishment of order to pave the way for a prosperous future for Pakistan. "
May Allah guide us on the path of truth and honour. Allah Hafiz."
5.???????? On 14-10-1999 the Chief of the Army Staff General Pervez Musharraf issued the Proclamation, effective from 12-10-1999, whereby the Constitution of the Islamic Republic of Pakistan, 1973 (hereinafter referred to as the Constitution) was held in abeyance and the whole of Pakistan brought under the control of Armed Forces. The text of the Proclamation dated 14-10-1999 reads thus:
"PROCLAMATION OF EMERGENCY"
"In pursuance of deliberations and decisions of Chiefs of Staff of the Armed Forces and Corps Commanders of Pakistan Army, I, General Pervez Musharraf, Chairman, Joint Chiefs of Staff Committee and Chief of Army Staff proclaim Emergency throughout Pakistan, and assume the office of the Chief Executive of the Islamic Republic of Pakistan.
"I hereby order and proclaim as follows:
(a)??????? The Constitution of the Islamic Republic of Pakistan shall remain in abeyance;
(b)??????? The President of Pakistan shall continue in office;
(c)??????? The National Assembly, the Provincial Assemblies and Senate shall stand suspended;
(d)??????? The Chairman and Deputy Chairman of the Senate the Speaker and Deputy Speaker of the National Assembly and the Provincial Assemblies shall stand suspended;
(e)??????? The Prime Minister, the Federal Ministers, Ministers of State, Advisors to the Prime Minister, Parliamentary Secretaries, the Provincial Governors, the Provincial Chief Ministers, the Provincial Ministers and the Advisors to the Chief Ministers shall cease to hold office;
(t)???????? The whole of Pakistan will come under the control of the Armed Forces of Pakistan.
This Proclamation shall come into force at once and be deemed to have taken effect on and 12th day of October, 1999."
This was followed simultaneously by the Provisional Constitution Order No. l of 1999, as amended, dated 14-10-1999, which reads thus:
TEXT OF PROVISIONAL CONSTITUTION ORDER NO. 1 OF 1999
"In pursuance of Proclamation of the 14th day of October, 1999, and in exercise of all powers enabling him in that behalf, the Chairman Joint Chiefs of Staff Committee and Chief of Army Staff and Chief Executive of the Islamic Republic of Pakistan under the Proclamation of Emergency of 14th October, 1999 (hereinafter referred to as the Chief Executive) is pleased to make and promulgate the following Order-
1.???????? (1) This Order may be called Provisional Constitution Order No. 1 of 1999.
(2) It extends to the whole of Pakistan.
(3) It shall come into force at once.
2.???????? (1) Notwithstanding the abeyance of the provisions of the Constitution of the Islamic Republic of Pakistan, hereinafter referred to as the Constitution, Pakistan shall, subject to this Order and any other Orders made by the Chief Executive, be governed, as nearly as may be, in accordance with the Constitution.
(2) Subject as aforesaid, all courts in existence immediately before the Commencement of this Order shall continue to function and to exercise their respective powers and jurisdiction:
Provided that the Supreme Court or High Courts and any other Court shall not have the powers to make any order against the Chief Executive or any person exercising powers or jurisdiction under his authority.
(3) The Fundamental Rights conferred by Chapter 1 of Part II of the Constitution, not in conflict with the Proclamation of Emergency or any Order made thereunder from time to time shall continue to be in force.
3.???????? (1) The President shall act on, and in accordance, with the advice of the Chief Executive.
(2) The Governor of a Province shall act on, and in accordance with the instructions of the Chief Executive.
4.???????? (1) No Court, tribunal or other authority shall call or permit to be called in question the Proclamation of Emergency of 14th day of October, 1999 or any Order made in pursuance thereof.
??????????? (2) No judgment, decree, writ, order or process whatsoever shall be made or issued by any Court or tribunal against the Chief Executive or any authority designated by the Chief Executive.
5.???????? Notwithstanding the abeyance of the provisions of the Constitution, but subject to the Orders of the Chief Executive all laws other than the Constitution, all Ordinances, Orders, Rules, Bye-laws, Regulations, Notifications and other legal instruments in force in any part of Pakistan whether made by the President or the Governor of a Province; shall be inserted and shall be deemed' to have always been so inserted, shall continue in force until altered; amended or repealed by the Chief Executive or any authority designated by him.
5-A(1) An Ordinance promulgated by the President or by the Governor of a Province shall not be subject to the limitation as to its duration prescribed in the. Constitution.
(2) The provisions of clause (1) shall also apply to an Ordinance issued by the President' or by the Governor which was in force immediately before the commencement of the proclamation Order of Chief Executive of the Fourteenth day of October, 1999.
Subject to the Proclamation Order of the Chief Executive of the Fourteenth day of October, 1999 and the provisions of the Provisional Constitution Order No. 1 of 1999 as amended, the President of the Islamic Republic of Pakistan on the advice of the Chief Executive, and the Governor of the Province on instructions of the Chief Executive, may issue and promulgate Ordinances which shall not be subject to the limitation as to their duration prescribed in the Constitution.
6.???????? The Proclamation of Emergency issued on 28th day of May, 1998, shall continue but subject to the provisions of Proclamation of Emergency, dated 14th day of October, 1999 and this Provisional Constitution Order and any other Order made thereunder.
7.???????? All persons who, immediately before the commencement of this Order, were in the service of Pakistan as defined in Article 260 of the Constitution and those persons who immediately before such commencement were in office as Judge of the Supreme Court, the Federal Shariat Court or a High Court or Auditor-General or Ombudsman and Chief Ehtesab Commissioner, shall continue in the said service on the same terms and conditions and shall enjoy the same privileges, if any."
6.???????? On 13th December, 1999, the Chief of Army Staff, General Pervez Musharraf, after assuming the office of the Chief Executive of Pakistan, promulgated the Oath of Office (Judges) Order, 1999 (Order X of 1999), which reads thus: '
OATH OF OFFICE (JUDGES) ORDER, 1999 ORDER NO. 10 OF 1999
"Whereas in pursuance of the Proclamation of Emergency of the fourteenth day of October, 1999, and the Provisional Constitution Order No. 1 of 1999, the Constitution of the Islamic Republic of Pakistan has been held in abeyance;
Whereas Pakistan is to be governed, as nearly as may be, in accordance with the Constitution;
Whereas all Courts in existence immediately before the commencement of this Order have been continued to function and exercise their respective powers and jurisdiction;
And whereas to enable the Judges of the Superior Courts to discharge their functions, it is necessary that they take Oath of their office;
Now, therefore, in pursuance of the aforesaid Proclamation and Provisional Constitutional Order, the Chief Executive is pleased to make and promulgate the following Order:-
1.???????? Short title and commencement.---(1) This Order may be called the Oath of Office (Judges) Order, 1999.
(2) It shall come into force at once.
2.???????? Interpretation.--In this Order, "Superior Court" means the Supreme Court of Pakistan or a High Court or the Federal Shariat Court and "Judge" includes Chief Justice.
3.???????? Oath of Judges.---A Judge of Superior Court appointed after the commencement of this Order shall, before entering upon office, make Oath before the authority specified in the Constitution and in the appropriate from set out in the Third Schedule to the Constitution. "
??????????????????????? ?????????????? (Sd.)
??????????? ??????????? General
??????????????????????????????????????????????????????????????? ????????????????????????????????????????????????????????????????The Chief Executive of the
????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? Islamic Republic of Pakistan
Chairman Joint Chief of Staff Committee
??????????? and Chief of Army Staff
?????? (Pervez Musharraf)
Rawalpindi
31st December, 1999.
On 25th January, 2000, the Chief Executive promulgated the following amended Oath of Office (Judges) Order, 2000 (Order I of 2000):
"OATH OF OFFICE (JUDGES) ORDER, 2000 ORDER NO. 1 OF 2000
"Whereas in pursuance of the Proclamation of Emergency of the Fourteenth day of October, 1999, and the Provisional Constitution Order No. 1 of 1999, as amended, the Constitution of the Islamic Republic of Pakistan has been held in abeyance;
Whereas Pakistan is to be governed, as nearly as may be, in accordance with the Constitution and the Chief Executive has and shall be deemed always to have had, the powers to amend the Constitution;
Whereas all Courts in existence immediately before the commencement of this Order have been continued to function and to exercise their respective powers and jurisdiction; subject to the Proclamation of Emergency and Provisional Constitution Order No. l of 1999 as amended.
And whereas to enable the Judges of the Superior Courts to discharge their functions, it is necessary that they take Oath of their office;
Now, therefore, in pursuance of the aforesaid Proclamation and Provisional Constitution Order as amended and in exercise of all other powers enabling him in that behalf, the Chief Executive is pleased to make and promulgate the following Order:-
(2)??????? It shall come into force at once
2.???????? Interpretation. ---In this Order, "Superior Court" means the Supreme Court of Pakistan or a High Court or the Federal Shariat Court and "Judge" includes Chief Justice.
3.???????? Oath of Judges.---(1) A person holding office immediately before the commencement of this Order as a Judge of Superior Court shall not continue to hold that office if he is not given or does not make, Oath in the form set out in the Schedule, before the expiration of such time from such commencement as the Chief Executive may determine or within such time from such commencement as the Chief Executive may determine or within such further time as may be allowed by the Chief Executive.
(2)??????? A Judge of Superior Court appointed after the commencement of this order shall, before entering upon office, make Oath in the form set out in the Schedule.
(3)??????? A Person referred to in clauses (1) and (2) who has made Oath as required by these clauses shall be bound by the provisions of this Order, the proclamation of Emergency of the Fourteenth day of October, 1999 and the Provisional Constitution Order No. 1 of 1999 as, emended and, notwithstanding any judgment of any Court., shall not call in question or permit to be called in question the validity of any of the provisions thereof. '
(4)??????? A Judge of Supreme Court or Federal Shariat Court shall make Oath before the President/Chief Executive or a person nominated by him and a Judge of High Court shall make the Oath before the Governor or a person nominated by him.
The Oath of Office (Judges) Order No. 10 of 1999 is hereby repealed. "
??????????? (Sd.)
??????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? ??????????????????? General
??????????????????????????????????????????? ??? ??????????????????????????????????????????????????????????????????????? ?????The Chief Executive of the
?????????????????????????????????????????????????????????????????????????????? ???????????????????????????????????????? ???Islamic Republic of Pakistan
???????????????????? Chairman Joint Chief of Staff Committee
????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? and Chief of Army Staff
????????????????????????????????????????? ???????????????????????????????????????????????????????????????????????????????????????????????(Pervez Musharraf)
Islamabad
25th January, 2000. "
7: We have heard the learned counsel appearing on behalf of the petitioners with great patience and Mr. Aziz A. Munshi, the learned Attorney General for Pakistan, Syed Sharifuddin Pirzada, Senior ASC, learned counsel appearing on behalf of the Federation of Pakistan, Mr. Abdul Haleem Pirzada, President, Supreme Court Bar Association and Dr. Farooq Hasan for President, Lahore High Court Bar Association as also Mr. S.M. Zafar, learned amicus curaie:
CONSTITUI'ION PETITION NO. 62 OF 1999
Syed Zafar Ali Shah v. General Pervez Musharraf etc.
The petitioner in this petition is an Advocate of the Lahore High Court as well as the Supreme Court of Pakistan. He is also a former member of the suspended National Assembly of Pakistan having been elected from Constituency No. NA-35, Islamabad. Besides, he is President of Pakistan Muslim League, Islamabad capital territory and former Parliamentary Secretary, Law and Parliamentary Affairs.
It is pleaded that sometime prior to the eventful day viz 12th October, 1999, the petitioner had left for the United States to attend 54th Session of the United Nations General Assembly, being a member of the delegation headed by Mr. Muhammad Siddique Kanju, Minister of State for Foreign Affairs. On 12th October, 1999, while he was in New York he learnt that the Prime Minister of Pakistan had removed General Pervez Musharraf, who was out of country, from his office and appointed Lt. General Ziauddin as the Chief of Army Staff. He had also learnt that Lt. General Mahmood Ahmed, Corps Commander 10 Corps had. captured the Pakistan Television Station, Islamabad, and after entering the Prime Minister's House forcibly had arrested the Prime Minister and his Colleagues present there. General Pervez Musharraf had appeared on the PTV on 13th October, 1999 at 3-00 a.m. and announced the dismissal of the Prime Minister. and his Government. Thereafter, on 14th October, 1999, he proclaimed state of emergency throughout Pakistan, assumed the office of the Chief Executive of the Islamic Republic of Pakistan and issued Provisional Constitutional Order No. 1 of 1999 whereby the Constitution was held in abeyance, the National and Provincial assemblies as well as the Senate were suspended and the country-was placed under the control of the Armed Forces and formation of the National Security Council, and the Cabinet was announced.
Ch. Muhammad Farooq, learned counsel for the petitioner, highlighted the grounds of challenge contained in the petition and also the grievance of the petitioner emanating from dismissal of the Pakistan Muslim League Government, holding in abeyance of the Constitution and suspension of the Senate, National and the Provincial Assemblies. He also referred extensively to the written statement filed by the respondents and the rejoinder filed by the petitioner in order to augment his petition and meet the points raised in the written statement. Referring to the grounds of challenge he emphasised that the Army take-over having been directed against an elected Prime. Minister and lawful Government was immoral, illegal and un?constitutional, the role of the Chief Executive assumed by General Pervez Musharraf was ultra vires the Constitution, and he and his colleagues had not only violated the oath taken by them under Article 244 of the Constitution but also committed the offence of high-treason by subverting the Constitution. The Chief Executive was performing his functions without taking oath of office and his actions being tainted with mala fide could not be justified on any ground whatsoever. He further submitted that the axed Government having been formed by duly elected representatives and in accordance with the Constitution and the law, was vested with a legal right to complete its tenure unless replaced by another Constitutional Government and its sudden and un-constitutional dismissal had tarnished the image of Pakistan and put at stake the interest of the country, in the global context, as well as of the Armed Forces, which were held in high esteem by one and all. According to him the expenditure being incurred on the present set up from national Exchequer was unauthorized. He thoroughly dissected the Proclamation of Emergency and the PCO and dubbed them as void ab initio and ultra vires the Constitution. He expressed his surprise on issuance of the Proclamation of Emergency from Karachi instead -of the Capital of the country. He was of the view that both the instruments offended against the Objectives Resolution enshrined in Article 2A, an integral and substantive part of the Constitution, which had not only laid down in most unequivocal terms that the State shall exercise its powers and authority through the chosen representatives of the people but had also guaranteed that the method of governance shall be based on Federalism, Parliamentary form of Government, Independence of Judiciary and the Injunctions of Islam as set out in the Holy Qur'an and Sunnah. Referring to the written statement he submitted that it .had been filed in the connected petition without any prayer to 6e treated as written statement in this petition, therefore, the assertions made in this petition had gone virtually unchallenged. He also took exception to the preliminary objections taken in the written statement. that this Court was bereft of jurisdiction to entertain the petition; the petition was not maintainable owing to suspension of the Fundamental Rights and. the General Elections held on 3rd February, 1997, were a farce. He stated vociferously that the turn out of voters was about 36% ; the election was transparent by all standards having been held under the Military umbrella and organized and conducted honestly, justly and fairly by a Chief Election Commissioner who was ex-Chief Justice, Peshawar High Court and an appointee of Mohtarma Benazir Bhutto and. the factum of transparency had been confirmed by the local and the foreign observers. He lamented that the democratic process was interrupted at regular intervals with the result that the country, which was created by force of vote had remained under Military rule for 30 long years.
Adverting to the objection in regard to bar of jurisdiction contained in the Proclamation of Emergency and the PCO, he submitted that these unconstitutional provisions cannot oust the jurisdiction of this Court which in the past .had not abdicated its jurisdiction even in the face of bar of jurisdiction contained in Articles. 63A(6) 66, 69, 199(3), 236(2), 239(5), 245(2), 270-A and 48(4) and had struck down the orders, decisions or actions which were found to be coram non judice, mala fide, in excess of jurisdiction or without jurisdiction. He cited the following authorities in support of his contention:- .
(1)PLD 1956 (W.P) Lahore 807 (F.B) (Ahmad Saeed Karmani's case).
(2) PLD 1977 Lahore 846 (Darvesh M. Arbey's case).
(3) PLD 1977 Lahore 1337 (Iqbal Ahmad Khan's case).
(4) PLD 1987 Karachi 296 (F.B) (Muhammad Bachal Memon's case)., (5) 1992 CLC 2043 (D.B), (Muhammad Naeem Akhtar's case).
(6) 1994 MLD 2500 (D.B) (Shams-ud-Din's case).
(7) PLD -1997 Lahore 38 (F.B), (Manzoor Ahmed Wattoo's case). .
(8) PLD 1989 Quetta 25 (F.B)(Muhammad Anwar Durrani's'case).
(9) PLD 1966 SC~ 105 (A.K. Fazalul Quader Chaudhry's case).
(10)????? PLD 1994 SC 738 (Pir Sabir Shah's case).
(11)????? PLD 1996 SCMR 1969 (The Speaker, Balochistan Provincial Assembly, Quetta's case).
(12) PLD 1996 SC 632 (F.B) (Mrs. Shahida Zahir Abbassi's case).
(13)????? PLD 1997 SC 426 (Mahmood Khan Achakzai's case).
(14)????? PLD 1998 SC 1263 (Wukala Mahaz Barai Tahafaz-e-Dastoor's case). .
(15)????? PLD 1999 SC 57 (Sardar Farooq Ahmed Khan Leghari's case).
(16)????? PLD 1999 SC 395 (Syed Jalal Mehmood Shah's case).
(17)????? PLD 1999 SC 504 (Sh. Liaqat Hussain's case).
Criticizing the third preliminary objection raised in the written statement about non-maintainability of the petition on account of suspension of the Fundamental Rights he submitted that the Fundamental Rights enshrined in the Constitution could not be suspended being based on the last Sermon of the Holy Prophet (p.b.u.h.) and the Islamic principles. Besides, the power conferred on the Courts by Article 4 of the Constitution cannot be curtailed even if the Fundamental Rights are suspended. In any event, notwithstanding the curb of suspension imposed by the Proclamation of Emergency and the P.C.O., the Fundamental Rights were alive and enforceable and the petition was maintainable, in view of the law laid down by this Court in the cases of Miss Benazir Bhutto PLD 1988 SC 416, Mian Muhammad Nawaz Sharif PLD 1993 SC 473, Wukala Mahaz Barai Tahafaz-e-Dastoor PLD 1998 SC 1263, Sardar Farooq Ahmed Khan Leghari PLD 1999 SC 57 and Sheikh Liaqat Hussain PLD 1999 SC 504.
He also took exception to the assertion made in the written statement that the Military take over was welcomed by the people of Pakistan as was evident from 'the public statements made by, leaders of various political parties. He was of the view that the people, by and large, were unhappy and disappointed and the coup d'etat was supported either by a few self-styled political leaders who wanted to secure slots in the new set?up or those politicians whose political parties had no representation in the Parliament.
He also raised a technical point that in view of the imminent threat of external aggression, the President of Pakistan had already issued a Proclamation of Emergency under Article 232(1) of the Constitution, therefore, the Proclamation of Emergency issued by General Pervez Musharraf was void ab initio being an unwarranted duplication.
Referring to the Constitutional status and role of the Armed Forces he submitted that according to Article 243 of the Constitution the Armed Forces were under the command and control of the Federal Government and in view of the explicit provisions of Article 245 of the Constitution, were obliged, under the directions of the Federal Government, to. defend Pakistan against external aggression or threat of war and, subject to law, act in aid of civil power when called upon to do so and there was no provision in the Constitution empowering them to take over the Federal Government or perform functions of any organ of the State. In order to lend support to the contention he read out the following excerpts from the case of Sheikh Liaqat Hussain PLD 1999 SC 504 by one of us (Irshad Hasan Khan, J.) (now the Chief Justice):-
"The soldiers and the citizens stand alike under the law. Both must obey the command of the Constitution and obedient to its mandates. The Armed Forces have to act within the scope of their jurisdiction as defined in the Constitution."
"A Government elected by the Constitution can only perform its functions and ensure observance of the provisions of the Constitution by making the civil power superior to and not subordinate to the Armed Forces during peace as well as war."
He further submitted that the Prime Minister had not done anything unconstitutional by removing the Chief of the Army Staff as under Article 243 of the Constitution he was fully empowered to do so. It was not the first time that he had exercised this power because in the past also he had removed the Chiefs of the Army, Navy and Air Force. The reaction of the Chief of the Army Staff and his colleagues was unjustified because under Article 91(4) of the Constitution the Cabinet was responsible to the National Assembly and not to them. While elaborating the role of the Armed Forces he made an outburst that the concept of Military Government was alien to the civilized world but unfortunately in our country the power is taken over by the Army after every decade on one pretext or the other.
He repeatedly and emphatically submitted that the Military take over and its concomitant two invalid instruments cannot be validated by invoking either the Kelsen's theory highlighted in Dosso's case PLD 1958 SC 533 as it was rejected in cases of Miss Asma Jilani PLD 1972 SC 139 and Begum Nusrat Bhutto PLD 1977 SC 657 or the `doctrine of necessity' propounded in the latter cases which according to the judgment of this Court' in the case of Sheikh Liaqat Hussain PLD 1999 SC 504 has been buried for ever and cannot be dug out from its grave. Besides, a parallel cannot be drawn between the situations prevailing at the time of imposition of Martial Law by General Ziaul Haq and the present take-over by General Pervez Musharraf. General Ziaul Haq had imposed Martial Law as the people had not accepted the result of the rigged election and there were violent demonstrations whereas in the present case there was no breakdown of law and order, the Federal and the Provincial Governments were running smoothly and the acts of terrorism committed by some anti-state elements in Karachi were successfully combated and curbed by imposing Governor's Rule. The Proclamation of Emergency and the P.C.O. were too invalid to be validated by any doctrine or the Agenda announced by the Chief Executive in his speech delivered on 17th October, 1999.
Another argument advanced by him with all the vehemence at his disposal was that the Army take-over had posed a grave danger to the Federalism as it had impaired the judicially recognized trichotomy of powers by eliminating the Executive, suspending the Legislature and making an attempt to curtail the independence of Judiciary. .
Reverting to the criticism leveled in the written statement against the person and policies of the former Prime Minister, he submitted that the allegation of making a fortune through kickbacks and other corrupt methods was vague, bald and false and could not serve as a springboard for justifying the take-over. The allegation that these amendments were bulldozed was a figment of the imagination of the respondents. The criminal cases registered against the former Prime Minister and his colleagues were also false and fabricated. The allegation that the former Prime Minister had taken steps to impair the Independence of Judiciary were also without any substance. The controversy in regard to freezing of the Foreign Exchange Accounts can be settled in the light of the detailed report of the State Bank of Pakistan. The Governor Rule imposed in the Province of Sindh was validated by this Court in the case of Syed Jalal Muhammad Shah PLD 1999 SC 395.
Ch. Muhammad Farooq, elaborating his arguments made a reference to The State v. Dosso PLD 1958 SC (Pak.) 5'33, wherein this ,Court, relying on Kelsen's theory of "revolutionary legality", validated the imposition of Martial Law by General Muhammad Ayub Khan and then proceeded to refer the case of Miss Asma Jilani v. Government of the Punjab PLD 1972 SC 139, wherein this Court overruled the dictum laid down in the case of Dosso (supra). Extensive references were made from Miss Asma Jilani's case, wherein at page 178 Placitum-I, it was observed:--
"Nevertheless, with utmost respect to the learned Chief Justice, I do feel that in laying down a novel juristic principle of such far ?reaching importance he did proceed on the basis of certain assumptions, namely:-
(1)??????? "that the basic doctrines of legal positivism", which he was accepting, were such firmly and universally accepted doctrines that "the whole science of modern jurisprudence" rested upon them;
(2)??????? that any "abrupt political change not within the contemplation of the Constitution" constitutes a revolution, no matter how temporary or transitory the change, if no one has taken any step to oppose it; and
(3)??????? that the rule of international law with regard to the recognition of States can determine the validity also of the States' internal sovereignty. "
"These assumptions were, in my humble opinion, not justified. As I have earlier indicated Kelsen's theory was, by no means, a. universally accepted theory nor was it a theory which could claim to have become a basic doctrine of the science of modern jurisprudence, nor did Kelsen ever attempt to formulate any theory which "favours totalitarianism".
At page 179 Placitum-I, of the above report, it was observed:-
"Kelsen has done so but unfortunately he still continues to be grievously misunderstood. He was only trying to lay down a pure theory of law as a rule of normative science consisting of an aggregate or system of norms'. He was propounding a theory of law as amere jurists' proposition about law'. He was not? attempting to lay down any legal norm or legal norms which are the daily concerns of Judges, legal practitioners or administrators'. In his early works this distinction was not made clear but in 1960 he attempted in his bookRechtslehre' to clarify the confusion by pointing out, as Julius Stone observes, `that the propositions of the pure theory of law are mere jurists' propositions about law and that they do not bind the Judge, in the way in which legal norms bind him.
At pages 181.-182, Placita-L, M, N of the report, it was observed:
"Kelsen in his attempt to evolve a pure science of law as distinguished from a natural science attached the greatest importance to keeping law and might apart. He did not lay down the proposition that the command of the person in authority is a source of law ...."
"I am also unable to agree with the learned Chief Justice that upon the principles of International Law if the territory and the people remain substantially the same there is "no change in the corpus or international entity of the State and the revolutionary Government and the new State are, according to International Law, the legitimate Government and the valid Constitution of the State". With great respect I must point out that this proposition does not find support from any principle of International Law. According to Oppenheim's view as propounded in his bbok on International Law if the revolutionary Government is ineffective and or has no "reasonable expectancy of permanence" and/or does not "enjoy the acquiescence of the population", then the international community may well-refuse to recognise it, even though its territorial integrity remains unchanged and its people remain substantially the same."
"In any event, if a grand-norm is necessary for us I do not have to look to the Western legal theorists to discover one. Our own grund?norm is enshrined in our own doctrine that the legal sovereignty over the entire universe belongs to Almighty Allah alone, and the authority exercisable by the people without the limits prescribed by Him is a sacred trust. This is an immutable and unalterable norm'
which was clearly accepted in the
Objectives Resolution passed by the Constituent Assembly of Pakistan on the 7th of March, 1949. This Resolution has been described by Mr. Brohi as the corner stone of Pakistan's legal edifice' and recognized even by the learned
Attorney-General himselfas the bond which binds the nation' and as a document from which the Constitution of Pakistan `must draw its inspiration'. This has not been abrogated by any one so far, nor has this been departed or deviated from by any regime, military or. Civil. Indeed, it cannot be, for, it is one of the fundamental principles enshrined in the Holy Qur'an:
Says, O Allah, Lord of sovereignty. Thou givest sovereignty to whomsoever Thou pleasest; and Thou takest away sovereignty from whomsoever Thou pleasest. Thou exaltest whomsoever
Thou pleasest and Thou abasest whomsoever Thou pleasest. (Pt.3, Ch.3, A1Imran, Ay,26.)
The basic concept underlying this unalterable principle of sovereignty is that the entire body politic becomes a trustee for the discharge of sovereign functions. Since in a complex society every citizen cannot personally participate in the performance of the trust, the body politic appoints State functionaries to discharge these functions on its behalf and for its benefit, and has the right to remove the functionary so appointed by it if he goes against the law of the legal sovereign, or commits any other breach of trust or fails to discharge his obligations under a trust. The functional Head of the State is chosen by the community and has to be assisted by a Council which must hold its meetings in public view and remain accountable to public. It is under this system that the Government becomes a Government of laws and not of men, for; no one is above the law. It is this that led Von Hammer, a renowned orientalist, to remark that under the Islamic system `the law rules through the utterance of justice, and the power of the Governor carries out the utterance of it.'
Reference was also made to head-note from page 143 of the report, which reads thus:-
"It is clear that under the Constitution of 1962, Field-Marshal Muhammad Ayub Khan had no power to hand over power to anybody. Under Article 12 of the Constitution he could resign his office by writing under his hand addressed to the Speaker of the National Assembly and then under. Article 16 as soon as the office of President fell vacant the Speaker of the National Assembly had to take over as the acting President of the Country and an election had to be held within a period of 90 days to fill the vacancy. Under Article 30 the President could also proclaim an emergency if the security or economic life of Pakistan was threatened by internal disturbances beyond the power of a Provincial Government to control and may be for the present purposes that he could also proclaim Martial Law if the situation was not controllable by the civil administration. It is difficult, however, to appreciate under what authority a , Military Commander could proclaim Martial Law. "
He then proceeded to refer passages from pages 206, 267 and 270, which are reproduced hereunder respectively as follows-
?"I too am of the opinion that recourse has to be taken to the doctrine of necessity where the ignoring of it would result in disastrous consequences to the body politic and upset the social order itself but I respectfully beg to disagree with the view that this is a doctrine of validating the illegal acts of usurpers. In my humble opinion, his doctrine can be invoked in aid only after the Court has come to the conclusion that the acts of the usurpers were illegal and illegitimate. It is only then that the question arises as to how many of his acts, legislative or otherwise, should be condoned or maintained, notwithstanding their illegality in the wider public interest. I would call this a principle of condonation and not legitimization."
"The learned Attorney-General has very frankly conceded that it is this Court that can put the final seal on the validity or otherwise of a law. He has also frankly conceded that it is difficult for him to support the provision of section 3(1)(a) of the President's Order No. 3 of 1969 which prohibits the Court from receiving or entertaining any complaint etc. The Court's power to discover law applicable to a situation has been accepted in the Governor?General's Reference No. 1 of 1955 (PLD 1955 FC 435). In the case under report the Governor-General having found himself in a difficult situation and having been unable to find any legal basis to meet the situation had to approach the then Federal Court for a solution of the problem and the Court answered the reference and indicated the manner in which the problem could be legally solved. "
"It is, thus, evident that the very foundations upon which the decision rested did not exist. I, therefore, think that this Court should make it clear that the validity or otherwise of an existing order can only be determined with reference to the laws of Pakistan and not to any theory of international jurisprudence. It is also necessary to state firmly that the question of existence of a revolution or its success are questions of fact which can only be decided upon evidence, and not assumed. This will remove once for all the temptations that have been placed in. the way of an adventurer seizing power illegally and destroying an existing legal order."
"Mr. A.K. Brohi, learned counsel appearing for the Federation of Pakistan, which was also made a party at his request, has taken two preliminary objections as to the maintainability of this petition:-
(a)??????? That it is directed against the Chief of the, Army Staff, whereas the orders of detention had been passed by the Chief Martial Law Administrator; and
(b)??????? That the petitioner is not an aggrieved person in terms of Article 184(3) of the Constitution read with Article 199 thereof, as she does not allege any violation of her own Fundamental Rights, but only those of the detenus.
"He also maintains that this Court has no jurisdiction to grant any relief in this matter owing to the prohibition contained in Articles 4 and 5 of the Laws (Continuance in Force) Order, 1977, which clearly contemplate that no Court, including the High Court and the Supreme Court, can question the validity of any Martial Law Order or Regulation, or any order made thereunder by a Martial Law Authority. He submits that under clause (3) of Article 2 of the aforesaid Laws (Continuance in Force) Order the right to enforce Fundamental Rights stands suspended, and for this reason as well the petition is not maintainable.
"As to the legal character of the new regime, and the validity of the Laws (Continuance in Force) Order, 1977, and the various Martial Law Regulations and Orders issued by the Chief Martial Law, Administrator and the President under its authority, Mr. Brohi submits that up to the 5th of July, 1977, Pakistan was being governed under the 1973 Constitution, but on that day a new Legal Order came into force by virtue of the Proclamation issued by the Chief Martial Law Administrator, and this Legal Order has displaced-albeit temporarily-the old Legal Order. The validity or legality of any action which takes place after the 5th of July, 1977 can only be tested against the guidelines provided by the new Legal Order. According to him, the grundnorm of the old Legal order, as provided by the 1973 Constitution, has given way to a new grundnorm. provided by the Proclamation and the Laws (Continuance in Force) Order, and to that extent the jurisdiction of the superior Courts has been altered. He submits that as the transition from the old Legal Order to the new Legal Order has not been brought about by arty means recognised or contemplated by the 1973 Constitution, therefore, it constitutes a meta-legal or extra Constitutional fact, attracting the doctrine of "revolutionary legality". In this context, according to Mr. Brohi, whenever a Constitution and the national Legal order under it are disrupted by an abrupt political change not within the contemplation of the Constitution, such a change is called a revolution, which term also includes coup d'etat. In such a situation the Court has to determine certain facts which may be termed "constitutional facts", which relate to the existence of the Legal Order within the framework of which the Court itself exists and functions. If it finds that all the institutions of State power have, as a matter of fact, accepted the existence of the new Legal Order, which 'has, thus, become effective, then all questions of legality or illegality are to be determined within the framework of the new Legal Order: Mr. Brohi submits that, on this view of the matter, a viable alternative can be found between the two extreme positions adopted by this Court in Dosso's Case (PLD 1958 SC (Pak.) 533) and Asma Jillani's case-one holding that every revolution, once successful is legal, and the other holding that a revolution as such is illegal. According to him, the Supreme Court in Dosso's case could have decided the controversy by simply holding that, as a matter of constitutional fact, a new Legal Order had come into being in the country, and the question in issue in that case could only be decided by reference to this new Legal Order which had attained effectualness. He contends that the view taken by the Supreme Court in Asma Jillani's case leaves several questions unanswered, by rejecting Kelsen's pure theory of law, because it does not provide any guidelines as to what law the Courts ought to apply in case a revolution has become effective by suppressing or destroying the old Legal Order. As a result, Mr. Brohi submits that this Court should, therefore, lean in favour of holding that a new Legal Order has effectively emerged in Pakistan by means of a meta-legal or extra-Constitutional change, and for the time being this is the legal framework according to which all questions coming before the Court must be decided. In his view it is not necessary for the Court, nor is it a concomitant of judicial power to either side with the revolution or to act as a counter-revolutionary, by giving its seal of approval to a military intervention or to condemn it by describing it as illegal. Judicial restraint requires that the Court should only take judicial notice of events which have transpired in the country, and decide as a constitutional fact, whether the new Legal Order has become- effective or not. "
"As to the necessity for the imposition of Martial Law on the 5th of July, 1977, Mr. Brohi has stated that the events leading thereto fall into two phases:-
(i) The first phase relates to the unconstitutional and illegal governance of this country by the detenus and their associates and terminates on the eve of the imposition of Martial Law; and
?(ii) The second phase relates to the preparations which were being made by detenus and their associates for the fomenting of civil war within the country and their intention to frustrate and prevent the holding of free and fair elections and thereby consolidate their illegal tenure of office." .
"He submits that the Court may take judicial notice of the picture emerging from the mosaic of these events, which are cited merely to illustrate the overall pattern of-events, and not to embark upon a detailed factual inquiry which would be outside the scope of these proceedings. According to the learned counsel, the specific illegalities committed by or at the instance of the former Government will form the subject-matter of independent legal proceedings in which the persons concerned will be afforded a reasonable opportunity for their defence in accordance with law."
"Mr. Brohi goes on to state that massive rigging took place during the elections held on the 7th of March, 1977 in accordance with the directions issued at the -highest Government level, and that the then Chief Election Commissioner, in an interview given to the daily Millat, Karachi, pointedly commented on the widespread irregularities committed in relation to these elections, and recorded this opinion that results in more than 50%a of the seats were affected thereby. He had, further .expressed the view that the appropriate course would be to hold fresh elections."
"Mr. Sharifuddin Pirzada next submits that although he would generally support Mr. Brohi's submissions as to the legal character of an effective revolution, yet he does not wish to adopt a position contrary to the one he took up while appearing as amicus curiae in Asma Jillani's case, regarding the validity and applicability of Kelsen's pure theory of law relating to the meta-legal character of the change and the birth of a new grundnorm. He submits that there are several renowned jurists who do not fully subscribe to Kelsen's view and consider that effectualness alone, to the exclusion of all considerations of morality and justice, cannot be made a condition of the validity of the new Legal Order. The learned counsel, however, submits that the circumstances culminating in the imposition of Martial Law on the 5th of July, 1977 fully attract the doctrine of State necessity and of salus populi est suprema lex, with the result that the action taken by the Chief Martial Law Administrator must be regarded as valid, and the Laws (Continuance in Force) Order, 1977, must be treated as being a supra-Constitutional instrument, now regulating the governance of the country. The learned Attorney-General contends that the doctrine of necessity is not only a part of the legal systems of several European countries, including Britain, but is also recognised by the Holy Qur'an. Hecontends that consequently all actions taken by the Chief Martial Law Administrator to meet the exigencies of the situation and to prepare the country for future election with a view to the restoration of democratic institutions must be accepted by the Courts as valid, and there can be no question of condonation, which concept can apply only in the case of the acts of a usurper. On this view of the matter, Mr. Sharifuddin Pirzada submits that . the Court cannot grant any relief to the detenus, under Article 184(3) of the Constitution, as the Fundamental Rights stand suspended by virtue of clause (3) of Article 2 of the Laws (Continuance in Force) Order, 1977. " .
"Mr. Brohi as well as Mr. Sharifuddin Pirzada were also asked to address the Court on the possible effect and implications of the new oath of office administered to the Judges of the Supreme Court and the High Courts after the imposition of Martial Law. They both stated that, in their view, the new oath has not in any manner restricted the independence of the superior judiciary, nor affected their obligation to perform their judicial functions according to law; it only indicates that the superior judiciary, like the rest of the country, has accepted the fact, which is even otherwise also evident, that, on the 5th of July, 1977, a radical transformation took place in the pre-existing Legal Order. Both the learned counsel are agreed, and Mr. Yahya Bakhtiar, learned counsel for the petitioner, joins them, that the taking of the fresh bath by the Judges of this Court does not in any way preclude them from examining the 'question of the validity of the new Legal Order and decide the same in accordance with their conscience and the law."
At page 681 of the report, it was observed:
"I have no cavil with the propositions and observations referred to by Mr. Brohi, but I do not see how they affect the correctness of the view taken in Asma Jillani's case. Even if the Court erred in observing that the assumption regarding the success of the revolution was not justified for the reason that a few days after the pronouncement of the Court President Iskander Mirza was himself deposed by Field Martial Muhammad Ayub Khan, and the Court should have assumed the facts as stated by Muhammad Munir, C.J., the view taken by the Court as to the applicability of Kelsen's theory is not affected by this error. The Court. has given sound reason for rejecting it, particularly the fact that it was at best a theory about law, which had not been universally accepted by other renowned jurists. Unless, therefore, compelling reasons are shown for departing from the view. taken by this Court in Asma Jillani's case, I would like to adhere to the same for the reasons so ably stated in the judgments of Hamoodur Rehman, C.J. and Muhammad -Yaqub Ali, J. (as he then was)."
At page 693, it was observed:
"The stage has now been reached for a somewhat detailed examination of the circumstances culminating in the imposition of Martial Law on the 5th of July, 1977. A brief mention thereof has already been made in the earlier part of this judgment, while summarising the contentions raised by Messrs. A.K. Brohi and Sharifuddin Pirzada. It may be stated that many of the averments made in this behalf in the written statement filed by Mr. A.K. Brohi have been strenuously controverted by the detenus who have filed written rejoinders and also appeared in person before the Court. Mr. A. K. Brohi has filed a rejoinder in reply to these statements of the detenns, and Mr. Zulfikar Ali Bhutto has filed a further written statement in response thereto. An affidavit of General (Retd.) Tikka Khan, a former Chief of Staff of the Pakistan Army and Minister of State in Mr. Bhutto's Government has also been placed on me record in refutation of certain actions attributed to him in the respondent's written statement. While taking note of all these statements and counter-statements, I think that in the present proceedings the Court is not called upon .to record a judicial finding as to the factual correctness or otherwise of the several allegations and counter-allegations made by the parties against each other. The Court is primarily concerned with ascertaining the broad trends and circumstances which culminated in the overthrow of, the Government of Mr. Z.A. Bhutto. For this purpose, we must take judicial notice of various events which happened in the country during the period commencing from the 7th of March, 1977 on which date the General Elections to the National Assembly of Pakistan were held, resulting in an overwhelming majority for the Pakistan People's Party led by Mr. Z.A. Bhutto. Ample material appears to be available on the record of this Court to enable us to arrive at the necessary conclusions."
At pages 701-702 it was observed:
"On the basis of the material thus brought to the notice of the Court by Messrs A.K. Brohi and Sharifuddin Pirzada, consisting.mostly of official reports and decisions as well as contemporary reports in the official newspapers, 1 think the Court is entitled to take judicial notice of the following facts:-
(1)??????? That from the evening of the 7th of March, 1977 there were widespread allegations of massive official interference with the sanctity of the ballot in favour of candidates of the Pakistan People's Party;
(2)??????? That these allegations, amounting almost to widespread belief among the people, generated a national wave of resentment and gave birth to a protest agitation which soon spread from Karachi to Khyber and assumed very serious proportions;
(3)??????? That the disturbances resulting, from this movement became beyond the control of the civil armed forces;
(4)??????? That the disturbances resulted in heavy loss of life and property throughout the country;
(5)??????? That even the calling out of the troops under Article 245 of the Constitution by the Federal Government and the consequent imposition of local Martial Law in several important cities of Pakistan, and they calling out of troops by the local authorities under the provisions of the Code of Criminal Procedure in smaller cities and towns did not have the desired effect; and the agitation continued unabated;"
(6)??????? That the allegations of rigging and official interference with elections in favour of candidates of the ruling party were found to be established by judicial decisions in at least four cases, which displayed a general pattern of official interference;
(7)??????? That public statements made by the then Chief Election Commissioner confirmed the widespread allegations made by, the Opposition regarding official interference with the elections, and endorsed the demand for fresh elections;
(8)??????? That in the circumstances, Mr. Z.A. Bhutto felt compelled to offer himself to a Referendum under the Seventh Amendment to the Constitution, but the offer did not have any impact at all on the course of the agitation, and the demand for his resignation and for fresh elections continued unabated with the result that the Referendum Plan had to be dropped;
(9)??????? That in spite of Mr. Bhutto's dialogue with the leaders of the Pakistan National Alliance and the temporary suspension of the Movement against the Government, officials charged with maintaining law and order continued to be apprehensive that in the event of the failure of the talks there would be a terrible explosion beyond the control of the civilian authorities;
(10) That although the talks between Mr. Bhutto and the Pakistan National Alliance leadership had commenced on the 3rd of June, 1977, on the basis of his offer for holding fresh elections to the National and Provincial Assemblies, yet they had dragged on for various reasons, and as late as the 4th of July, 1977, the Pakistan National Alliance leadership was insisting that nine or ten points remained to be resolved and Mr. Bhutto was also saying that his side would similarly put forward another ten points if the General Council of P.N.A. would not ratify the accord as already reached on the morning of the 3rd of July, 1977;
(11)????? That during the crucial days of the dead-lock between Mr. Z.A. Bhutto and the Pakistan National Alliance leadership the Punjab Government sanctioned the distribution of fire-arms licenses on a vast scale, to its party members, and provocative statements were deliberately made by the Prime Minister's Special Assistant, Mr. G.M. Khar, who had patched up his differences with the Prime Minister and secured this appointment as late as the 16th of June, 1977; and
(12)????? That as a result of the agitation all normal economic, social and educational activities in the country stood seriously disrupted, with incalculable damage to the nation and the country."
Ch Muhammad Farooq, maintained that in the light of the above?mentioned circumstances/conditions prevailing in the country at the relevant time the Court reached the conclusion that the imposition of Martial Law, which was for a limited period so as to attain limited objectives, was valid. He submitted that the Court can take note of the fact that no such circumstances existed in the present case as the State institutions were working normally and even meeting of the National Assembly had been convened for 15th October, 1999.
He submitted that this Court took notice of the salient points of the speech made by General Muhammad Ziaul Haq on the evening of the 5th of July, 1977 wherein the reasons for the action he had taken of overthrowing the Government of Mr. Z. A. Bhutto and dissolving the Federal and Provincial Legislatures, were summarized in the following terms:-
"From the objective narration of events as they were happening from the 7th of March, 1977 onwards, one is left in no doubt that the Constitutional and moral authority of the National Assembly which had come into being as a result of the elections held on the 7th of March, 1977, as well as of the Federal and Provincial Governments formed thereafter as a result of mandates given to them by the National and the Provincial Assemblies had, been continuously and forcefully repudiated throughout the country over a prolonged period of nearly four months, thus, resulting in serious disruption in all spheres of national life. It can only be a matter of conjecture at this stage, whether an accord between the Government and the Pakistan National Alliance would have finally emerged if the Army had not intervened. From the material placed on the record, in the shape of deliberations of official committees, it has become abundantly clear that the situation was surcharged with possibilities of further violence, confusion and chaos.
"Having found that the extra-Constitutional step taken by the Armed Forces of Pakistan was justified by requirements of State necessity and welfare of the people it is now necessary to examine its legal consequences."
"But the Constitution has not been abrogated. Only the operation of certain parts of the Constitution has been held in abeyance. Mr. Fazal Elahi Chaudhry has very kindly consented to continue to discharge his duties as President of Pakistan as heretofore under the same Constitution. I am grateful to him for this. To assist him in the discharge of his national duties, a four-member Military Council has been formed. The council consists of the Chairman, Joint Chiefs of Staff, and Chiefs of Staff of the Army, Navy and the Air Force.
"I will discharge the duties of the Chief of Army Staff and Chief Martial Law Administrator. Martial Law Orders and instructions as and when required will be issued under my orders."
"He further stated on this occasion that:
"I want to make it absolutely clear that neither I have any political ambitions nor does the Army want to be detracted from its profession of soldiering. I was obliged to step in to fill in the vacuum created by the political leaders. I have accepted this challenge as a true soldier of Islam. My sole aim is to organise free and fair elections which would beheld in October this year. Soon after the polls power will be transferred to the elected representatives of the people. I give a solemn assurance that I will not deviate from this schedule. During the next three months my total attention will be concentrated on the holding of elections and I would not like to dissipate my powers and energies as Chief Martial Law Administrator on anything else."
"As to the place of Judiciary, he stated that:-
"It will not be out of place to mention here that I hold the Judiciary of the country in high esteem. I will do my best to refrain from doing anything which is likely to restrict the power of the Judiciary. However, under unavoidable circumstances, if and when Martial Law Orders and Martial Law Regulations are issued, they would not be challenged in any Court of law."
"It will be seen that the declared objectives of the imposition of Martial Law are to create conditions suitable for the holding of free and fair elections in terms of the 1973 Constitution, which was not being abrogated, and only certain parts of which were being held in abeyance, namely the parts dealing with the Federal and the Provincial Executives and Legislatures. The President of Pakistan was to continue to discharge his duties as heretofore under the same Constitution. Soon after the polls the power is to be transferred to the elected representatives of the people. It is true that owing to the necessity of completing the process of accountability of holders of public offices, the holding of elections had to be postponed for the time being but the declared intention of the Chief Martial Law Administrator still remains the same, namely, that he has stepped in for a temporary period and for the limited purpose of arranging free and fair elections so as to enable the country to return to a democratic way of life."
He also referred a passage from page 721 of the report, which reads thus:-
"It has already been seen that the conditions culminating in the Proclamation of Martial Law on the 5th of July, 1977, were-so grave that the very existence of the country was threatened, that chaos and bloodshed, was apprehended and there eras complete erosion of the constitutional authority of the Federal Government, leave alone that of the various Provincial Governments. The situation had indeed deteriorated to such an extent that it justified an extra-Constitutional step, resulting in the suspension of certain parts of the Constitution itself by the Armed Forces. Such being the case, the situation was obviously at least of the kind contemplated by clause (12) .of Article 232 of the Constitution. In the circumstances, the Chief Martial Law Administrator was justified in providing in clause (3) of Article 2 of the Laws (Continuance in Force) Order that the right to. enforce Fundamental Rights shall be suspended. It was clearly an order which could have been made under the 1973 Constitution. No exception can, therefore, be taken to the validity of this provision."
He then referred to the conclusions reached by the Court after somewhat lengthy discussion of the various questions raised therein, which were summed up as follows:-
"(i)??????? That the legal character and validity of any abrupt political change, brought about in a manner not contemplated by the pre-existing Constitution or Legal Order, cannot be judged by the sole criterion of its success or effectiveness, as contemplated by Kelsen's pure theory of law. Not only has this theory not been universally accepted, or applied, it is also open to serious criticism on the ground that, by making effectiveness of the political change as the sole condition or criterion of its legality, it excludes from consideration sociological factors or morality and justice which contribute to the acceptance or effectiveness of the new Legal Order. The legal consequences of such a change must, therefore, be determined ,by a consideration of the total milieu in which the change is brought about, including the motivation of those responsible for the change, and the extent to which the old Legal Order is sought to be preserved or suppressed;
(ii)??????? That in any case the theory of revolutionary legality can have no application or relevance to a situation where the breach of legal continuity is of a purely temporary nature and for a specified limited purpose. Such a phenomenon can more appropriately be described as one of constitutional deviation rather than of revolution;
(iii)?????? That examined in this light, the Proclamation of Martial Law on the 5th of July, 1977, appears to be an. extra-Constitutional step necessitated by. the complete breaks down and erosion of the constitutional and moral authority of the Government of Mr. Z.A. Bhutto, as a result of the unprecedented protest movement launched by the Pakistan National Alliance against the alleged massive rigging of elections to the National Assembly, held on the 7th of March, 1977. It was a situation for which the Constitution provided no solution, and the Armed Forces had, therefore, to intervene to save the country from further chaos and bloodshed, to safeguard its integrity and sovereignty, and to separate the warring factions which had brought the country to the brink of disaster;
(iv)?????? That the imposition of Martial Law, therefore, stands validated on the doctrine of necessity, and the Chief Martial Law Administrator is entitled to perform all such acts and promulgate all legislative measures which have been consistently recognised by judicial authorities as falling within the scope of the law of necessity;
(v)??????? That it has also become clear from a review of the events resulting in the culmination of Martial Law, and the declaration of intent made by the Chief Martial Law Administrator, that the 1973 Constitution still remains the supreme law, subject to the condition that certain parts thereof have been held in abeyance on account of State necessity; and the President of Pakistan as well as the superior Courts continue to function under this Constitution. In other words, this is not a case where the old Legal Order has been completely suppressed or destroyed, but merely a case of constitutional deviation for a temporary period and for a specified and limited objective, namely, the restoration of law and order and normalcy in the country, and the earliest possible holding of free and fair elections for the purpose of the restoration of democratic institutions under the 1973 Constitution;
(vi)?????? That, accordingly, the superior Courts continue to have' the power of judicial review to judge the validity of any act or action of the Martial Law Authorities if challenged in the light of the principles underlying the law of necessity as set out in this judgment. Their powers under Article 199 of the Constitution, thus, remain available to their full extent, and may be exercised as heretofore, notwithstanding anything to the contrary contained in any Martial Law Regulation or Order, Presidential Order or Ordinance; and
(vii) That the provisions contained in clause (3) of Article 2 of the Laws (Continuance in Force) Order, 1977, suspending the right to enforce Fundamental Rights are valid for the reason that ,the situation prevailing in the country was obviously of such a nature as to amount to an Emergency contemplated by clause (1) of Article 232 of the Constitution, and the right . to enforce Fundamental Rights could, therefore, be legitimately suspended by an order of the kind which could have been made under clause (2) of Article 233 of the constitution."
24.?????? He then made reference to the, case of Sardar Farooq Ahmed Khan Leghari v. Federation of Pakistan PLD 1999 SC 57, to contend that though Proclamation of Emergency was validated, but the action of suspension of fundamental rights was overruled. To substantiate his view, he took the Court through paragraphs 78 to 82, wherein Irshad Hasan Khan, J. (as he then was), now the Chief Justice observed
"78. I appreciate the frank and bold statement made by Syed Sharifuddin Pirzada, though appearing on behalf of the Government that a judicial order to the Executive could be' passed to revoke the Proclamation of Emergency if the material presented against the same satisfied the Court, on solid grounds, that the circumstances did not warrant to proclaim emergency. I am also inclined to agree with him. "
"79. Clearly, the petitions are maintainable. I fully subscribe to the reasoning assigned by the Hon'ble Chief Justice in repelling the contention of the learned 4ttorney-General on the question of maintainability."
"80. I am not impressed by the plea raised by the learned Attorney?-General that this Court has no authority ~ to examine the Proclamation of Emergency issued by the President. The Parliament, the President, the Executive and Judiciary are the creatures of the Constitution. Each organ of the State has to function within the sphere allotted to it under the Constitution. Neither of them can be permitted to invade into the functions and powers of the other organs of the State. As to what power was granted to the Courts and what limitations were imposed on it are questions which have always been, and always will be, the subject of a close examination by the superior Courts, under the Constitutional scheme envisaged by the Constitution of Islamic Republic of Pakistan, 1973. The independence of the judiciary can never be taken away."
"81. Loyalty to the State is the basic duty of every citizen. Obedience to the Constitution and law is equally applicable to every citizen wherever he may be and every other person for the time being within Pakistan including the Government in power and the Courts. Clearly, the Court can, exercise the power vested in it under the Constitution to examine the validity of the proclamation with a view to ascertain as td whether the pre-conditions laid down under Article 232(1) of the Constitution exist or not or it is without jurisdiction, coram non judice or mala fide. But the Courts while exercising judicial power must also abide by the Constitution. It is true that the powers available under the above provisions are drastic and might be abused. The danger of abuse is theoretically present. But in this case, it is wholly absent. The Proclamation is intra vires of the Constitution. There has been no abuse of exercise of power by .the President. In fact, Mr. Shahzad Jehangir emphatically stated that no motive could be attributed to the President and that he acted in good faith."
"82. Fundamental Rights provide Constitutional safeguards to civil liberties. These rights guaranteed by the Constitution are essential human rights which inherently belong to every citizen of a country governed in a civilized mode. Not one of these safeguards can, the President of Pakistan, the Parliament, the Executive or the Judiciary, disturb under the scheme of the Constitution, except those having reasonable nexus with the object of the Proclamation of Emergency during its continuance. This is essential to ensure so that the Government may not derogate from Fundamental Rights. If arbitrary and unlimited powers for suspending Fundamental Rights is conceded to. the Government, during the period of Emergency, and without having any reasonable nexus with the object of Proclamation, the dangers to human liberties are frightful to contemplate. Such a concession to the Government is likely to lead to despotism and anarchy, which cannot be countenanced by the Courts. I respectfully do not subscribe to the view taken by the Indian Supreme Court in the case of Muhammad Yaqub (supra) that it is open to the President to suspend the enforcement of any of the Fundamental Rights conferred under the Constitution during the continuance of emergency and wherever such suspension is made it is in the interest of the country and no further proof of it is necessary. In my humble view only such Fundamental Rights can be suspended which have nexus with the reasons which led to the Proclamation of Emergency. A satisfactory solution can, therefore, be had only if the power available to the President under the Constitution to proclaim emergency is exercised with the least encroachment upon the rights and liberties of the citizens. "
He also referred to paragraph 21 of the report at page 394, wherein Muhammad Bashir Jehangiri, J. observed as under:-
"21. It would, thus, be noticed that we have developed an unfortunate trend over a period of half a century of our independent national existence to rush to suspend the Fundamental Rights on one pretext or another. As soon as the country had tested its nuclear capability, the 'respondents, for no reason readily understandable, clamped a state of emergency under the cover of which firstly, the citizens of Pakistan were stripped off all the fundamental rights but later on only the Fundamental Rights provided for in Articles 10, 15, 16, 17, 18, 19, 23, 24 and 25 were ordered to remain suspended. Even if, Proclamation- of a state of emergency was justified as we have held the suspension of Fundamental Rights were unwarranted a move which created fresh doubts about the intention of the Government. Not only the Government revealing the extent of its faith in the patriotism of ordinary Pakistanis, it was also insulting their intelligence unnecessarily. The learned Attorney-General had, of course, argued that in the first rush of excitement after the nuclear explosions, it did not have enough time to weigh these matters with the care they deserved. Worse, even when it had an opportunity to make amends, it thought fit not to do so. The President (which means the Government and the Federation) has modified the emergency order and restored some rights like the freedom to practise religion but the order carrying this direction does not touch the freedoms which have a practical bearing on every day life like the freedom from arbitrary arrest or the freedom of speech and association."
Ch Muhammad Farooq, also referred some passages from the case of Sh. Liaquat Hussain v. Federation of Pakistan PLD 1999 SC 504, which read as under:-
"25. It may be stated that it seems to be correct that after the taking over of the executive power by the Governor in Sindh, commission of the crimes has been reduced including the acts of terrorism. This is also visible if one is to visit Karachi and see the situation obtaining now and talk to the common people, of which this Court can take judicial notice. According to the learned Attorney-General's submission, the establishment of the Military Courts in Karachi and other parts of Sindh also contributed in bringing the normalcy in Sindh. In this behalf, it may be stated that the law and order situation started improving immediately on the taking over of the executive power by the Governor on 3-10-1998. Whereas the impugned Ordinance was promulgated on 20-11-1998. According to Mr. M. Akram Sheikh, learned counsel, the above improvement in the law and order situation was because of sharpening up of the administrative response. There are more people to catch and lesser people to influence or interfere with the process of apprehending and prosecuting accused persons and not on account of establishment of the Military Courts. Be that as it may, even if we were to accept the above contention of the learned Attorney ?General, the question which needs consideration is that if the establishment of the Military Courts is not warranted by the Constitution, simpliciter the fact that their establishment had contributed to some extent in controlling the law and order situation or the factum of delay in disposal of the criminal cases by the Courts existing under the general laws or under the special laws, as was urged by the learned Advocate-General, Sindh, would justify this Court to uphold their validity. In my humble view, if the establishment of the Military Courts under the impugned Ordinance is violative' of the Constitution, we cannot sustain the same on the above grounds or on the ground of expediency. Acceptance of the Doctrine of Necessity by this Court inter alia in the case of the State v. Dosso and another (PLD 1958 SC (Pak.) 533), turned out to be detrimental to the evolution and establishment of a democratic system in this Country. It may be observed that some critics feel that the same had encouraged and caused the imposition of the Martial Law in this country more than once, which adversely affected the attainment of maturity by the Pakistani nation in the democratic norms. As a fall out, our country had been experiencing instability in the polity. The doctrine of necessity cannot be invoked if .its effect is to violate any provision of the Constitution, particularly keeping in view Article 6 thereof which provides that "Any person who abrogates or attempts or conspires to abrogate, subverts or attempts or conspires to subvert the Constitution by use of force or show of force or by other unconstitutional means shall be guilty of high treason."
"It may be pointed out that the concept of imposition of Martial Law in Pakistan in connection with the maintenance or restoration of order in any area was visualized till the framing of the present Constitution of 1973, as highlighted in the above two judgments of the full Benches of Sindh and Lahore High Courts."
"26. It may be observed that the present Constitution of the Islamic Republic of Pakistan, 1973, does not admit the imposition of Martial Law in any form. This is indicated from the language employed in Article 237 of the Constitution which empowers the Parliament to make any law indemnifying any person in the service of the Federal Government or a Provincial Government, or any maintenance or restoration of order in any area in Pakistan. But it does not admit the imposition of Martial Law in any form. This is indicated from the language employed in Article 237 of the Constitution which empowers the Parliament to make any law indemnifying any person in the service of the Federal Government or a Provincial Government, or any maintenance or restoration of order in any area in Pakistan. But it does not cover indemnification, for acts done during the period of Martial Law. In contrast to the above provision of the present Constitution, our three late Constitutions of 1956, 1962 and Interim Constitution of 1972, provided for enacting of law for indemnifying any person in the service of the Federal Government or a Provincial Government or any other person, in respect of any act done in connection with the maintenance or restoration of order in any area in Pakistan where Martial Law was in force."
"45. The soldier and the citizen stand alike under the law. Both must obey the command of the
Constitution and obedient to its mandates. The Armed Forces have to act within the scope of their jurisdiction as defined under the Constitution as long as the acts of the Armed Forces fall within the scope of their jurisdiction the same are protected while such are in excess of their jurisdiction, are exceptionable. It is only where the civil power is completely broken, Courts in the country have ceased to function, the danger of imposition of Martial Law cannot be ruled out notwithstanding the provisions of Article 6 of the
Constitution, which provides that any person who abrogates or attempts or conspires to abrogate, subverts or attempts or conspires to subvert the
Constitution by use of force or show of force or by other unconstitutional means shall be guilty of high treason. But in all other cases, the expression to call the Armed Forces in aid of civil power' excludes the substitution of
Civil Courts by the Military Courts. The Armed Forces should be kept in strict subordination to be governed by the civil power and the State as is apparent from a bare reading of Article 243 of the Constitution, which provides that the
Federal Government shall have the control and command of the Armed Forces. The necessity of the Armed Forces for the preservation of the society, peace, defence, integrity and solidarity of Pakistan cannot be under estimated.
Needless to say that during the present emergency and until the danger of terrorism and internal disturbances is removed, the Armed Forces may be called by the Federal Government to "act in aid of civil power"subject to law' and confer on it such other powers as the situation may require. However, the Armed Forces cannot be permitted to substitute the ordinary Civil Courts while acting in aid of civil power'. A Government elected by the Constitution can only perform its functions and ensure observance of the provisions of the
Constitution by making the civil power superior to and not subordinate to the
Armed Forces during peace as well as war. This is the foundation stone of
Constitution of Pakistan as reflected in Article 2A that sovereignty over the entire universe belongs to Almighty Allah alone and the authority to be exercise by the people of Pakistan within the limits prescribed by Him is a sacred trust and that the State shall exercise its powers and authority through the chosen representatives of the people, wherein the fundamental rights shall be guaranteed, including equality of status, of opportunity and before law, social economic and political justice and freedom of thought, expression, belief, faith, worship and association, subject to law and public morality and that the independence of the Judiciary shall be fully secured. Clearly, the integrity of the territories of the Federation, its independence and all its rights, including the sovereign rights on land, sea and air, shall be safeguarded by the Armed Forces, under the control and directions of the Federal Government.
The termin aid of civil power' implies that some assistance may be necessary to the civil power for the performance of its functions and not the taking over of the civil powers, especially the judicial powers of the Judiciary."
"47. Examination of the above case-law also fortifies the view that the phrase to act in aid of civil power' used in Article 245(1) of the Constitution, clearly does not include the power to substitute the existing judicial system and/or to establish a parallel system. It is true that the State has a right to protect itself against terrorist activities including all those who would destroy it, and it could be said that that right has been linked with the right of the individual to his self-defence but in the exercise of such right and with a view to preserving the society and the State, it must take all measures in conformity with the
Constitution and not in derogation thereof. Clearly, in order to protect the innocent citizens against terrorist activities the Army can actin aid of civil power' by rendering such assistance as may be needed under the direction of the Federal Government excluding the power to share the judicial power exclusively vesting in the Judiciary and/or to supplant the existing system by establishment of parallel Courts as has been done pursuant to the impugned
Ordinance. When the Army is acting in the aid of civil power' to restore peace and normalcy, the power to apprehend accused, their investigation, arrest and assistance in expeditious submission of the challan to the Courts, production and attendance of witnesses and their security including that of the Presiding
Officers and the Advocate, is incidental to the directions of the Federal
Governmentto act in aid of civil power'. It is difficult to enumerate the acts/steps that may be taken by the Armed Forces while acting in aid of civil power' but in the exercise of the said power they cannot either directly or indirectly share the judicial powers of the Courts or replacement thereof. The impugned legislation, to that extent, is therefore, wholly unwarranted and cannot sustain even on ground of alleged necessity, as canvassed by the learned
Attorney-General, the learned Advocate-General, Sindh and Syed Iqbal Haider.
The termto act in aid of civil power' no matter how liberally it may be construed, would not in any manner whatsoever embrace the judicial powers conferred on the Courts under the scheme of the Constitution."
"48. I am fully inclined to agree with the learned Attorney-General that the impugned Ordinance was promulgated bona fide with a view to restore peace and normalcy in the country and, particularly, in Sindh, but, however,-bona fide an action may be in itself, it cannot be a touchstone for judging the constitutionality of the impugned Ordinance. Its validity is to be judged only on the touchstone of the Constitutional provisions. Reading Articles 175, 203 and 245 together and in the light of the judgment rendered by this Court in the case of Mehram Ali (supra), it indubitably leads to the conclusion that the Military Courts envisaged under the Constitution tantamount to establishment of parallel Courts for which there was no warrant. The bare reading of Article 245 would show that it does not contemplate declaration of Martial Law or Mini-Martial Law in any form whatsoever. It is not the case of the learned Attorney-General that the Courts are not functioning. He, however, argued that the Courts were not deciding the cases expeditiously on account of fear of the terrorists. If that is so, the proper course was to take appropriate measures by improving methods of investigation, expeditious submission of challan to the trial Courts security of witnesses/litigants as well as the Presiding Officers of the Courts and to take long/short term measures including appropriate increase in the strength of Judges in the light of the various reports of the Law Commission.
"49. Thus, visualized, the Courts established pursuant to the impugned Ordinance do .not fall within the purview of any of the Constitutional provisions. The Constitution envisages trichotomy of powers of the three organs of the State, namely, Legislature, Executive and the Judiciary. The Legislature is assigned the task of law-making, the Executive to execute such laws and the Judiciary to construe and interpret the laws. None of the organs of the State can encroach upon the fields allotted to others. The Constitution does not countenance the take-over of the judicial functions by the Armed Forces at the direction of the Federal Government in the purported exercise of power conferred on it under Article 245 of the Constitution. Article 245 does not by itself create the law but enables the making of a law, which should have nexus with the phrase to act in aid of civil power'. The replacement of Courts either partially or wholly is not recognized under any provisions of the Constitution. A bare reading of Article 243 would show that the Armed Forces are subject to the control and authority of the Federal Government i.e. a civilian Government. No circumstances existed in the country, which indicated the breaking down of the judicial organ, necessitating establishment of Military Courts. It is imperative for the preservation of the State that the existing judicial system should be strengthened and the principle of trichotomy of power is adhered to by following, in letter and spirit, the Constitutional provisions and not by making deviation thereof on any ground whatsoever."
?58. The plea raised on behalf of the learned Attorney-General that the Doctrine of Necessity is not outdated and can be invoked in the present case for a `limited purpose' cannot be countenanced, for, if it is approved of, it may very frequently be resorted to at the incidence of a situation presently prevailing in the country, by the Executive. In, fact, such approval whereby the Executive is allowed to cross the barriers of Constitutional provisions at its whim, would turn a democratic rule into a despotic one. Clearly, any deviation from the Constitution may lead to anarchy. It is true that the take?over by the Chief of the Army Staff as Martial Law Administrator was validated by this Court in Begum Nusrat Bhutto's case PLD 1977 SC 657 wherein it, was inter alia observed :-
`On no principles of necessity could power of judicial review vested in the superior Courts under the 1973 Constitution, be taken away' (p.716 last para. extending to page 717).
"However, in the case of Asma Jilani (supra), this Court took the view that the acts of usurper may be condoned and/or validated by the application of the law of necessity. Viewed from this angle, the impugned Ordinance being ultra vires the Constitution cannot be validated even on the touchstone of State necessity. Additionally, in view of the plea raised by the learned Attorney-General that the establishment of Military Courts is spelt out from the power vesting in the Federal Government under Article 245 is contradictory with the theory of State necessity, inasmuch as, the concept of law of necessity, would arise only if an act which would otherwise be illegal becomes legal if it is done bona fide, in view of State necessity, with a view to preserving-- the State or the society from destruction by the terrorists. In the instant case, we have no doubt that the impugned Ordinance was issued bona fide with a view to suppress the menace of terrorism. Nevertheless, the constitutionality of the Ordinance is not to be judged on the question of bona fides of the Federal Government simpliciter but on the touchstone of the Constitutional provisions. Here, impugned legislation is ultra vires the Constitution in so far as it takes away the functions of the Courts in determining the guilt or innocence of an accused. Be that as it may, the prerequisites for the application of Doctrine of Necessity are not satisfied in the instant case for upholding the impugned legislation,. even for a limited period. The prerequisites, as laid down in the case of Attorney-General of Republic v. Mustafa Ibrahim 1964 CLR 195, which was also referred in the Begum Nusrat Bhutto's case (supra), are :-
"(a)?????? An imperative and inevitable necessity or exceptional circumstances;
(b)??????? no other remedy to apply;
(c)??????? the measure taken must be proportionate to the necessity; and
(d)??????? it must be of a temporary character limited to the duration of the exceptional circumstances.'
"In the instant case, the
Courts are functioning and the question of backlog and expeditious disposal of terrorists' case can be remedied by taking effective measures, in the light of the guidelines provided by this Court in the short order as well as the recommendations in the concluding paragraphs of this note. The Courts are functioning properly and administering justice according to the Constitution and the law. These Courts, therefore, cannot be replaced by Military Courts as attempted to be done either partially or wholly by virtue of the impugned
Ordinance. The role of Armed Forces as contemplated under Article 245 is to defend the country from external aggression or threat of war or to come to the
aid of civil power' subject to law. The second function of coming in theaid of civil power' to be performed by the Armed Forces is subject to a condition precedent of enacting a law. The law so made must have nexus with the term to act in aid of civil power'. The role of Armed Forces while actingin aid of civil power' does not in any way confer the power either directly or indirectly to interfere with the Courts established under Article 175(1) of the
Constitution and/or to supplant them."
"59. Let me now discuss the contention raised on behalf of the petitioners as to the independence of Judiciary, which, according to them, has been set at naught with the promulgation of the Ordinance in question. The Constitution of the Islamic Republic of Pakistan, 1973 in its preamble (now made a substantive part thereof vide Article 2A) declares that "the independence of the Judiciary shall be fully secured" therein. According to a consensus of the jurists, the independence of the Judiciary means that every Judge is free to decide matters before him in accordance with his assessment of the facts and his understanding of the law without improper influences, inducements or pressures, direct or indirect, from any quarter or for any reason; and that the Judiciary is independent of the Executive and Legislature, and has jurisdiction, directly or by way of review, overall issues of a judicial nature. This Court vide its judgment in the case of Sharaf Afridi (supra), has separated the Judiciary from the Executive."
Reliance was also placed on the case of Miss Asma Jilani (supra), wherein at page 181 sideline `L' of the report, it was observed:
"Kelsen's attempt to justify the principle of effectiveness from the standpoint of International Law cannot also be justified, for it assumes the primacy of International Law over
National Law.' In doing so he has, to my mind, overlooked that for the purposes of International Law the legal person is the State and not the community and that in International Law there is nolegal order' as such. The recognition of a State under International Law has nothing to do with the internal sovereignty of the State, and this kind of recognition of a State must not be confused with the recognition of the Head of a State or Government of a State. An individual' does not become the Head of a State through the recognition of other States but through the -municipal law of his own State. The question of recognition of a
Government from the point of view of International Law becomes important only when a change in the form of Government also involves a break in the legal continuity of the State or where the question arises as to whether the new
Government has a reasonable expectancy of permanence so as to be able to claim to represent the State" (vide Oppenheim's International Law, Vol. I, page 127)
At page 183 sideline,`O' of the report, it was observed:
"The principle enunciated in Dosso's case, therefore, is wholly unsustainable, and it cannot be treated as good law either on the principle of stare decisis or even otherwise."
"We have also in this connection been referred to a case from Cyprus sub-nomine. The Attorney-General of the Republic v. Mustafa Ibrahim and others 1964 CLR 195 where the Supreme
Constitutional Court of Cyprus also applied the doctrine of necessity to validate a certain legislation which was otherwise inconsistent with certain
Articles of the Cyprus Constitution on the ground that they would be justified
if it can be shown that it was enacted only in order to avoid consequences which could not otherwise be avoided, and which if they had followed, would have inflicted upon the people of Cyprus, whom the Executive and Legislative organs of the Republic are bound to protect, inevitable irreparable evil, and furthermore if it can be shown that no more was done than was reasonably necessary for that purpose, and that, the evil inflicted by the enactment in.
question, was not disproportionate to the evil avoided'. This the Court thought was its duty to do in view of itsall important and responsible function of transmitting legal theory into living law, applied to the facts of daily life for the preservation of social order'."
??????????? ACTS CONDONED UNDER THE
??????????? PRINCIPLE OF CONDONATION:
"Applying this test I would condone:
(1)??????? all transactions which are past and closed, for no useful purpose can be served by reopening them;
(2)??????? all acts and legislative measures which are in accordance with, or could have been made under, the abrogated Constitution or the previous legal order;
(3)??????? all acts which tend to advance or promote the good of the people;
(4)??????? all acts required to be done for the ordinary orderly running of the State and all such measures as would establish or lead to the establishment of, or in our case, the objectives mentioned in the Objectives Resolution of 1954:
(5)??????? I would not, however, condone any act intended to entrench the usurper more firmly in his power or to directly help him to run the country contrary to its legitimate objectives.
(6)??????? I would not also condone anything which seriously impairs the rights of the citizens except in so far as they may be designed to advance the social welfare and national solidarity."
(1)??????? From the foregoing it is evident that, in the first place, President's Order No.3 of 1969 and Martial Law Regulation No.78 do not exist so far as this Court is concerned, and therefore, they are not valid laws.
(2)??????? In the second place even if it be assumed that they do exist, they can not deprive the Court of its inherent jurisdiction to consider the validity or otherwise of those laws or any action taken thereunder."
ILLUSTRATION OF INTERFERENCE AGAINST
ORDERS PASSED BY MARTIAL LAW AUTHORITIES
"(3) Supposing by an order passed under Martial Law Regulation No. 78, X' has been ordered to be detained. While executing this order, however, instead ofX', `Y' is arrested and detained. It is absurd to say that the Court is deprived of its jurisdiction to consider the validity of the order vis-a-vis the person detained merely because the order is by a Martial Law Authority."
At pages 268-269 of the report, it was observed:
"It has been contended by the learned Attorney-General that President's Order No. 2 has provided for a remedy in a matter like this. I am unable to agree with him. Having regard to the provisions made in section 3 of the President's Order No. 3 of 1969, any question regarding the correctness, legality or propriety of exercise of any powers or jurisdiction of a Martial Law Authority could not be referred to the Chief Martial Law Administrator for decision by a Martial Law Authority itself, for the Court's jurisdiction even to receive or entertain any complaint in that respect has been sought to be ousted. The position, therefore, is that any order passed by a Martial Law Authority, if it is labelled as such, it must be accepted as a good order whether it is in fact made or could be made under any Martial Law Order or Regulation, or not. Such an unlimited and undefined power, which is at the same time arbitrary and not governed by any rule of law, can never be accepted as good by any Court of law. Such an unlimited power is not only foreign to Islamic Law but is also not recognised in any modern society."
"I, therefore, fully agree that Dosso's case must be reviewed on the grounds mentioned by my Lord the Chief Justice."
" 1. Armed Forces cannot abrogate, abridge or displace civil power.
Doctrine of necessity-imposition of Martial Law in Pakistan has been done away with.
No Martial Law can be imposed-Parliament cannot enact a law to indemnify the acts done during Martial Law.
Command of the Armed Forces vests with Federal Government.
Martial Law cannot come in scheme of the Constitution.
Impugned legislation cannot be sustained on ground of alleged necessity.
Control of the Armed Forces vests with Federal Government i.e. a civilian Government.
Loyalty to the State, duty of every citizen-Doctrine of Necessity discussed.
Judiciary custodian of Fundamental Rights."
Ch. Muhammad Farooq also made extensive references from the case of Darvesh M. Arbey, Advocate v. Federation of Pakistan and 2 others PLD 1977 Lah. 846, as follows:
"6.??????? It is important to note that even a nexus or connection has not been provided by the amendment between the offences made exclusively triable by the Military Courts by virtue of this amendment and the subject for which the Armed Forces had been called in Lahore i.e. to restore law and order. The result is that even to that extent this amendment in the Army Act, has in fact, resulted in the displacement of the ordinary- criminal Courts in the District of Lahore by the Military Courts."
"The provision in the proviso to section 3 of Act X of 1977 that the authorised Army Officer can transfer any such case, in his discretion to the ordinary criminal Courts, does not in our view improve the status of the ordinary Courts."
"7.??????? It is, therefore, obvious that to the extent that the Courts established by the Armed Forces are trying civilians of Lahore for offences which have no nexus with the object for which they are said to have come, they (i.e. the Armed Forces) are not acting "in aid" of the civil power but in derogation or replacement thereof. This is certainly not envisaged by Article 245(1) that the "laws" subject to which the Armed Forces are required to act under that Article are intended to be of a nature as would not place the Armed Forces in a position superior or dominant to that of the civil power or to bestow such powers on them that; instead of acting in aid of the civil power, the Armed Forces, in fact, start acting in supersession or displacement of the civil power. We are, therefore, of the view that as far as Act X of 1977; (which amends the Army Act, 1962), is concerned, the most essential precondition prescribed by clause (3) of Article 245 which is mentioned by the learned Attorney-General as the 2nd jurisdictional fact; is absent. Consequently, we hold that clause (3) of Article 245 does not have the effect of ousting the jurisdiction of this Court under Article 199."
"(i)??????? That paragraph (1) to be read in conjunction with paragraphs (b) and (c) to Explanation to clause (1), of Article 63A of the Constitution. It must, therefore, follow as a corollary that a member of a House can be disqualified for a breach of party discipline in terms of said paragraph (a) when the alleged breach relates to the matters covered by paragraphs (b) and (c) to the
Explanation to clause (1) of Article 63-A of the Constitution and that the breach complained of occurred within the House."
"(ii) That paragraph (a) to Explanation to clause (1) of Article 63A of 'the Constitution is to be construed in such a way that it should preserve the right of freedom of speech of a member in the House subject to reasonable restrictions as are envisaged in Article 66 read with Article 19 of the Constitution."
"Article 89 of the Constitution of Pakistan does not confer a total or absolute immunity on the proceedings of the Provincial Assembly. "??????????.."The High Court has jurisdiction in appropriate cases to exercise its extraordinary writ jurisdiction in connection with such proceedings e.g., when the so-called proceedings are really outside the Constitution." (pp. 816, 818) E, F."
The observations relied upon in the case of Darvesh M. Arbey (supra) are as under:
"No nexus or connection provided by amendments introduced by Act X of 1977, between offences made exclusively triable by Military Courts and restoration of law and order, object for which armed forces called in" ??? .........?? .........?? .....?????? ??????????? :?????????? "Amendment, to such extent, resulting in displacement of ordinary criminal Courts by Military Courts" ??? .........??????????? ......????? ......????? "Provision authorising army officers to transfer any case to ordinary criminal Courts in their discretion not improving status of ordinary Courts at all" ?? .........?? .....?????? . . ??????? .........?? .........?? "Courts established by Armed Forces to such extent as they try civilians for offences having no nexus with restoration of law and order, held, not acting in `aid' of civil power but in derogation or replacement thereof and such position not envisaged by cl,(1) of Art. 245." -- "Laws subject to which Armed Forces required to act under Art. 245(1) of the Constitution" ?????? .........?? .........?? "Intended to be of a nature not placing Armed Forces in a position superior or dominant to that of civil power or to enable them to act in supersession or displacement of civil power" ???? .........?? .........?????????????? "Act X of 1977 accordingly, held, lacks essential precondition prescribed in cl. (3) of Art. 245 of acting in aid of civil power in pursuance of Federal Government's direction and jurisdiction of High Court under Art. 199 not ousted in view of cl. (3) of Art. 245."
The observations relied upon in the case of Iqbal Ahmad Khan (supra) are as., under:
"Act X of 1977 having been held to be ultra vires and beyond scope of Art. 245 by Full Bench in case reported as PLD 1977 Lah.846, Army Officers/Military Tribunals devoid of jurisdiction to deal with cases transferred to them from ordinary criminal Courts under provisions of Act X of 1977"???????"Order passed by Army Officers/Military Tribunals committing petitioners to custody of police/jail authorities of extending - remand order, in circumstances, held, without any legal substance and ineffective."
?The observations relied upon in the case of Muhammad Bachal Memon (supra) are as under:
"Where actions taken between 5-7-1977 and 29-12-1985 under any Martial Law. Regulation, Martial Law Order, enactment, rule etc. were mala fide, without jurisdiction. or coram non judice, immunity provided under Art. 270-A(2) would not save them completely from scrutiny of Superior Courts and, therefore, Art. 270-A(2) did not provide a complete bar in respect of such actions."..............."Clause (1) of Article 270-A, Constitution of Pakistan, 1973 given validity to the laws including Martial Law Orders and Regulations made during 5-7-1977 to 30-12-1985 and provides that the same shall not be called into question in any Court on any ` ground whatsoever notwithstanding any judgment of any Court or anything contained in the Constitution."??????Proviso of clause (1) of Article 270-A although covers a small period of 30-9-1985 to 30-12-1985, yet it does provide a scope for examining the laws made by the C.M.L.A. daring this period."????????"More important in respect of the actions of Martial Law Authorities is clause (2) of Article 270-A which has provided that actions taken by the Martial Law Authorities during the specified period shall not be called into question on any ground whatsoever notwithstanding any judgment of any Court."???????"In spite of the bar provided, the jurisdiction of the Superior Courts .to scrutinise actions of Military Authorities is not completely barred in respect of those actions which were mala fide, without jurisdiction or coram non judice."??????."If the actions were mala fide, coram non judice or without jurisdiction, then in spite of the validity conferred on such actions and the immunity, the Superior Courts were not completely debarred from scrutinising the actions. However; the scope of scrutiny was limited to actions which were mala fide, coram non judice and without jurisdiction. In other respects the immunity was considered complete."???????The legislature was aware of the interpretation placed by the Supreme Court of .Pakistan on a similar provision. Therefore, when it enacted clause (2) of Article 270-A of the Constitution, the Legislature knew that it is providing validity and immunity to the actions to the extent already explained and interpreted by the Supreme Court and that this validity did not extend to action which were mala fide, coram non judice of without jurisdiction. "??????"By reading only clause (2) of Article 270-A without taking into consideration the other provisions of the same Article, it would be clear that the legislature had intended that if the impugned actions were mala fide, without jurisdiction or coram non judice, then the immunity provided under Article 270-A, clause (2) would not save them completely from the scrutiny .of the Superior Courts and, therefore, clause (2) of the Article 270-A does not provide a complete bar in respect of such actions. "
The observations relied upon in the case of Muhammad Naeem Akhtar (supra) are as under:
"Action of Speaker in accepting resignation in question, would neither come within the meaning of term "any proceedings in the Provincial Assembly" used in Art. 69(1) read with Art. 127 of the Constitution, nor such action could be described as an exercise of power by the Speaker for regulating the procedure or the conduct of business in the Assembly" ???????"Constitutional petition against action . of Speaker in accepting resignations of Members of Assembly was, thus, maintainable. " .
The observations relied upon- in the case of Shams-ud-Din ,(supra) are as under:-
"Internal proceedings which were carried out by the Assembly, during its session, were not amenable to the jurisdiction of Court, however, all other administrative actions by the Speaker including recruitment of employees, would not enjoy immunity from judicial review particularly when such action of Speaker, prima facie, was in violation of existing rules or the discretion vested in him to take certain decisions in' order to run smoothly the functions of Provincial Assembly . Secretariat, had not been exercised judiciously, High Court under Art. 199 of the -Constitution was competent to examine validity or otherwise of such action."
The observations relied upon in the case of- Manzoor Ahmad Wattoo (supra) are as under:
"Bar of jurisdiction . provided in provision of cl. (2) of Art. 236, Constitution of Pakistan (1973) does not cover a Proclamation which is without jurisdiction, coram non judice or mala fide" ..... .....????????? "Superior Courts have the jurisdiction to examine a Proclamation under their power of judicial .review and declare same as invalid and unconstitutional."
The observations relied upon in the case of Muhammad Anwar Durrani (supra) are as under:
??????????? "Ousted only in respect of irregularity of procedure" ????.."Where interpretation of Constitutional instrument is involved, jurisdiction of High Court is unaffected."
The observations relied upon in the case of A.K. Fazalul Quader (supra) are as under:
"Letter purporting to communicate a resignation from membership of National Assembly, addressed to President of Pakistan, instead of to Speaker, National Assembly" ?????? .....?????? .....?????? .....?????????????????? "Member,later,? protesting [by two telegrams and a letter, addressed to Speaker, dispatched before his letter of "resignation" had reached the Speaker (Speaker being out of country)] that he had not intended to resign from membership of Assembly, but from membership of "Council Muslim League National Assembly Party" ??????? ......????? ......????? ......"Speaker declaring that member had resigned his seat within meaning of Art. 107(a), by Gazette Extraordinary Notification" ......????? ......????? ......????????????????? "Consequent action taken by Chief Election Commissioner to fill vacancy and a new member elected accordingly" ???? . ????????? .....?????? ....??????? . "Member challenging vires of Speaker's Gazette Notification by petition under Constitution of Pakistan (1962), Art. 98"??? .....?????? ..... - "Plea taken on behalf of Speaker that matter was not justiciable in view of bar of jurisdiction raised by Constitution of Pakistan (1962), Art. 111 "??????? . ????????? ....??????? . ????????? "Held, that member had not intended to resign from membership of National Assembly (in circumstances of case)" "Letter complying with conditions of Art. 107(a) takes effect automatically and does not require "acceptance" by any authority" ? .....?????? .....Locus
poenitentiae available to member" ???????? .....?????? ....??????? .
"Communication to Speaker essential ingredient of application of Art.
107"???? .....?????? .....?????? ......????????????????? "Speaker to construe documents together" ??????? .....?????? .....?????? .....?????? ??????????? "Constitution of Pakistan (1962), Art. lll(2)"?????? ...???????? ....??????? .....?????? "Question of resignation' of member not a question ofprocedure', conduct of business', or ofmaintenance or order' within meaning of Art. 111(2):"??????? .....?????? ..........??????????????????????? "Supreme Court and High Court have power to "intervene" (under Art. 98) in cases of "excess" of lawful authority."
The observations relied upon in the case of Pir Sabir Shah (supra) are as under:
"Provision of Art. 236(2) of the constitution will not cover Proclamation by the President under Art. 234 of the Constitution which is without jurisdiction, coram non judice or mala fide" ....."Superior courts will have jurisdiction to examine such a Proclamation."? .....?????? .....?????? .....?????????????????? "Clause (2) of Article 236 of the Constitution of Pakistan will not cover a Proclamation which is without jurisdiction, coram non judice or mala fide and the superior Courts will have jurisdiction to examine a Proclamation from the above three jurisdictional legal aspects."
The observations relied upon in the case of Mrs Shahida Zahir Abbasi (supra) are as under:
"Bar contained in Art. 199(3) of the Constitution on the powers of High Court is not absolute in nature"???."Such bar is not applicable to the cases namely where the impugned action is mala fide or without jurisdiction or coram non judice."
The observations relied upon in the case of Mahmood Khan Achakzai (supra) are as under:-
"Contention that the Judges of the Superior Courts having taken oath under the impugned Amended Constitution (by Constitution (Eighth Amendment) Act, 1985) and had been receiving salary which had been increased from time to time could not strike out the impugned Constitutional Amendment (Constitution (Eighth Amendment) Act, 1985, was repelled" ?????? .....??????????? ...???????? . ????????? "Power and jurisdiction of judicial review could not be controlled and fettered on such basis" ???? ....??????????? .....?????? .....?????????????????? "Judges of the Superior Courts had taken oath to defend, preserve and protect the Constitution" ...... .......? ......????? ......????????????????? "If any illegal amendment was made or had been made in the constitution, the Courts were competent to examine the same and make interpretation to reconcile its provision in which inferior rights must yield to higher rights" ........"Salary paid to the Judges was not a bounty or favour it was a Constitutional duty to provide salary and benefits to the judges by which independence of judiciary was guaranteed" ......????? ...... "Courts while striking down any illegal and unconstitutional provision or interpreting the Constitution defend, protect and preserve the Constitution."???????? ......??????????? ......????? ......????????????????? "Fact that any question is a political question will not deter the Court from determining it provided the same involves the interpretation of Constitution or the validity of such question is to be determined on the touchstone of the Constitution" .....?????? .....?????? .....?????????????????? "Court should not adopt "political question doctrine" for refusing to determine difficult and knotty, questions having political. overtones which would amount to abdication of judicial power which neither the Constitution permits nor the law allows" ..."Any action taken, act done or policy framed which violates the provisions of the Constitution or .is not permissible under the Constitution or law, -the Court, irrespective of the fact that it is a political question, must exercise powers of judicial review" ? ..... ....? "Abuse, excess or non-observance of the provisions of the Constitution has to be checked by the Court unless its jurisdiction is barred by the Constitution or law."??? .....?????? ...??????????? .....?????????????????? "Provision of Art. 270-A, Constitution of Pakistan 1973, as provided legal cover for deviation by President from the mandate given by Supreme Court in Begum Nusrat Bhutto v. Chief of Army Staff PLD 1977 SC 657" ??????????? ......????? ......????? .......???????????????? "Validity of Art. 270-A, Constitution of Pakistan 1973, having been determined consistently, competence of Parliament and the laws enacted up to 30-12-1985 which had been validated and protected, could not be questioned" ????????? ......????? ......????? ......????????????????? "Actions under such laws, however, could be challenged on grounds of coram non judice, mala fides and lack of jurisdiction."
The observations relied upon in the case of Wukala Mahaz Barai Tahafaze Dastoor (supra) are as under:
"Bar contained in Art. 63-A(6) does not completely take away the jurisdiction of Supreme Court or High Courts" ...........??????????? "Jurisdiction of Supreme Court and High Courts tinder Art. 199 of the Constitution, in respect of actions t en under Art. 63-A of the Constitution, will be available in c as of such order being coram non judice, mala fide or without jurisdiction" ............Any amendment in the Constitution which purports to alter the existing federal structure or the Islamic character of the Constitution or the existing parliament by system or which undermines independence of judiciary or abrogates or abridges any Fundamental Right may be regarded as repugnant to the basic structure of the Constitution."?????? .....?????? ...???????? ......????? ??????????? "Supreme Court as a guardian of the Constitution, has a right and the power to declare an amendment in the Constitution as un forceable or void if the same is construed to be violative of a basic structure of the Constitution or is found to have been assed in derogation of a Fundamental Rights. However, the question as to what are the basic essential features of the Constitution f Pakistan is yet to be answered with clarity. Nevertheless, regarding certain basic essential' features of the Constitution, there can hardly be expressed any. doubt. Any amendment in the Constitution which purports to alter the existing federal structure or Islamic character of the Constitution or the existing Parliamentary system or which undermine independence of judiciary or abrogates or abridges any fundament 1 right may be regarded as repugnant to the basic structure o f the Constitution."
The observations relied upon in the case of Sardar Farooq Ahmed Khan Leghari (supra) are as under:
"Provisions of Art. 236(2), Constitution of Pakistan (1973), which bar the jurisdiction of the Courts from examining the validity of any Proclamation will not cover a Proclamation which is without jurisdiction, coram non judice or mala fide.
The observations relied upon in the case of Jalal Mehmood Shah (supra) are as under:
"Provision of Art. 236(2) of the Constitution will not cover a Proclamation- which is without jurisdiction. coram non judice or mala fide " ?????? ...???????? .....?????? .....?????? "Superior Courts have jurisdiction to examine a Proclamation from the said three jurisdictional legal aspects "
The observations relied upon in the case of Federation of Pakistan and another v. Ghulam Mustafa Khar PLD 1989 SC 26 are as under:
"Article 270-A does not -take away the jurisdiction of the High Courts from reviewing acts, actions or proceedings which suffered from defect of ,jurisdiction or were coram non judice or were male fide"????"Drawing a distinction between malice in fact and malice in law was not necessary for such purpose."
Support was also sought from the following authorities:
1.???????? Sh. Liaquat Hussain v. Federation of Pakistan PLD 1999 SC 504.
2.???????? Speaker Balochistan Provincial Assembly v. M. Azam 1996 SCMR 1969. ??????
3.???????? Yousaf Ali v. uhammad Aslam Zia PLD 1958 SC 104.
to contend that notwithstanding the PCO promulgated on 14-10-1999, this Court has jurisdiction to hear and decide the controversy raised in the petition on merits. learned counsel laid great emphasis on certain observations made in the cases of:
1.???????? Pir Sabir Shah (supra)
2.???????? Sardar Farooq hmed Khan Leghari (supra)
3.???????? Sh. Liaquat Hus sain (supra)
The observations relied upon in the case of Farooq Ahmad Khan Leghari (supra) are as follows :
Per Irshad Hasan Khan. J.
(as he then was) (now Chief Justice)
"However, whether in a particular situation the extent of powers used is proper and justifiable? is a question which would remain debatable and beyond judicially discoverable and manageable standards unless the exercise of the excessive power is so palpably irrational or mala fide as to invite judicial intervention. In fact, once the issuance of the Proclamation is held valid, the security of the kind and degree of power used under the Proclamation, falls in a narrow compass. There is every risk and fear of the Court undertaking upon itself the task of evaluating with fine scales and through its own lenses the comparative merits of one rather than the other measure. The Court will, thus, travel unwittingly into the political arena and subject itself more readily to the charges of encroaching upon policy making. The `political thicker' objection sticks more easily in such circumstances. Although, therefore, on the language of Article 356(1), it is legal to hold that the President may exercise only some of the powers given to him, in practice it may not always be easy to demonstrate the excessive use of the power. "
"The learned Attorney-General, while giving a brief legislative history of Emergency Provisions in the sub-continent, in particular, argued that emergency provisions of enforcement of Fundamental Rights, had been provided since the promulgation of the Government of India (Consolidated) Act, 1924, which were retained in the Government of India Act, 1935. "
"In this connection it was also said that external aggression means armed aggression and as for some time past there was no armed aggression against the territory of India, the continuance of the Proclamation was unjustified. This contention must also fail on the ground which we have just mentioned."
"The Parliament, the President, the Executive and Judiciary are the creatures of the Constitution. Each organ of the State has to function within the sphere to it under the Constitution. Neither of them can be permitted to invade into the functions and powers of the other organs of the State. As to what power was granted to the Courts and what limitations were imposed on it are questions which have always been, and always will be, the subject of a close examination by the superior Courts, under the Constitutional scheme envisaged by the Constitution of Islamic Republic of Pakistan, 1973. The independence of the judiciary can never be taken away."
"Loyalty to the State is the basic duty of every citizen. Obedience to the Constitution and law is equally applicable to every citizen wherever he may be and every other person for the time being within Pakistan including the Government in power and the Courts. Clearly, the Court can, exercise the power vested in it under the Constitution to examine the validity of the proclamation with a view to ascertain as to whether the pre-conditions laid down under Article 232(1) of the Constitution exist or not or it is without jurisdiction, coram non judice or mala fide. But the Courts while exercising judicial power must also abide by the Constitution. "
The observations relied upon in the case of Liaquat Hussain (supra) are as follows :
Per Ajmal Mian. CJ.
(as he then was)
"The civil power is to be preserved and invigorated through the employment of the Armed Forces. The Armed Forces can be called in aid under the above clause by the Federal Government inter alia to perform police functions for limited purpose of suppressing riots or preventing threatened disorder or for the purpose of maintaining law and order and security or to assist/help in natural calamities alongwith the civil authorities. But the Armed Forces cannot abrogate, abridge or displace civil power of which Judiciary is an important and integral part. In other words, the Armed Forces cannot displace the Civil/Criminal Courts while acting in aid of civil power. They can certainly arrest those who threaten to disturb peace and tranquillity. They may also assist in investigation of a case and the prosecution of the same but the case is to be tried by a Court established in terms of the judgment of this Court in the case of Mehram Ali (supra). The employment of the expression `subject to law' clearly demonstrates that the Armed Forces will have to act .within the parameters of the Constitution and the law obtaining. The scope of the above power which is exercisable by the Armed Forces in aid of the civil power can only be enlarged by amending Article 245 of the Constitution. In this behalf Mr.Aitzaz Ahsan has invited our attention to the case of Goplan v. State of Madras AIR (37) f 950 SC 27 in which the Indian Supreme Court took the view that the Courts are not at liberty to declare an Act void because in their opinion it is opposed to a spirit supposed to pervade the Constitution and the Courts cannot declare limitation under the notion of having discovered something in the spirit of the Constitution which is not even mentioned in the instrument."
"I may point out that Article 190 of the Constitution has also employed the expression "shall act in aid of the Supreme Court" by providing that all Executive and Judicial Authorities throughout Pakistan shall act in aid of the Supreme Court. Can the. Executive Authority when called in aid by the Supreme Court under the above Article substitute or displace it. The object of the above Article 190 seems to be to assist or to help the Supreme Court in getting its directions, orders and judgments implemented and executed."
"There cannot be two opinions that the representative Government? in Sindh had failed to eradicate terrorism from the Province of Sindh particularly from Karachi: In my opinion in the case of Syed Jalal Mehmood Shah, I had held that invocation of Article 245 of the Constitution by the Federal Government was warranted by the situation which was obtaining in Sindh. The relevant portion reads as follows
"The above principle of law enunciated in the case of Federation of Pakistan and another v. Malik Ghulam Mustafa Khar PLD 1989 SC 26 (supra) covers an executive action. No mala fide can be attributed to the Parliament as it is sovereign to legislate on any subject for which it has been empowered by, the Constitution to legislate with the parameters thereof. The Court cannot strike down a statute on the ground of mala fide, but the same can be struck down on the ground that it is violative of the constitutional provision. In this respect reference may be made to the case of Mehr Zulfiqar Ali Babu and others v. Government of the Punjab and others PLD 1997 SC 11. In the present case I have already held hereinabove that neither Article 245 of the Constitution nor Entry No.l of tile Federal Legislative List read with Entry No.59 empowers the Legislature to legislate a statute which may establish or convene Military Courts in substitution of the ordinary criminal and civil courts. In this view of the matter, the above contention of the learned Attorney-General is not germane to the controversy at issue."
Per Irshad Hasan Khan. J.
(as he then was) (now Chief Justice)
"These Courts, therefore, cannot be replaced by Military Courts as attempted to be done either partially or wholly by virtue of the impugned Ordinance. The role of Armed Forces as contemplated under Article 245 is to defend the country from external aggression or threat of war or to come to the aid of civil power' subject to law. The second function of coming in theaid of civil power' to be performed by the Armed Forces is subject to a condition precedent of enacting a law. The law so made must have nexus with the term to act in aid of civil power'. The role of Armed Forces while actingin aid of civil power' does not in any way confer the power either directly or indirectly to interfere with the Courts established under Article 175(1) of the Constitution and/or to supplant them."
He also read out last paragraph from page 400 of the report, which reads thus:-
"In a Parliamentary form of Government the Legislature not only legislates but it is also instrumental for the election/appointment of the Prime Minister or the Chief Minister and the Members of the Cabinet, as the case may be, inasmuch as only the Member commanding the majority of the Members of the Parliament/Provincial Assembly can be elected/appointed as the
there was dictatorship of the Prime Minister under the cover of democracy, the steps were taken by the Government of the chosen Representatives to put economy on sound footings, the democratic Government showed highest respect to the Superior Judiciary.
12.?????? That the Federal Government, comprising the Prime Minister and its Cabinet were only responsible to the National Assembly under Art. 91(4) of the Constitution, and, the Chief of the Armed Forces, who had been removed by the Prime Minister on 12-10-1999, in the exercise of his Constitutional and lawful authority, cannot be allowed to be a Judge on the acts and deeds of the Prime Minister, Members of the Cabinet, the Chief Ministers, the Provincial Cabinets and the Members of the two Houses and the Provincial Assemblies.
13.?????? The petitioner has established beyond any doubt that the impugned Proclamation of Emergency And PCO 1 of 1999 and the entire super-structure of actions/declarations of respondent No. l 'based thereon, lack constitutional and legal authority. and merit grant of relief claimed in Paras. (a) to (h) and (1) in C.P. No. 62 of 1999 by accepting the petition with costs. "'
??????????? ??????????????????????? CONSTITUTION PETITION N0.63 OF 1999
Mr. Khalid Anwar, learned Senior ASC, appearing on behalf of the petitioners in Constitution Petition No. 63 of 1999, submitted that he represented the petitioners from very wide spectrum including Speaker, National Assembly, Chairman Senate, the Leader of the House in the Senate with members of Provincial Assemblies and various political parties across the political divide.
At the outset, Mr. Khalid Anwar has placed on record formulations of his main points as follows:
Formulation of Main Points
"I.???????? The central point can be stated quite simply. Pakistan was being governed under the Constitution of Pakistan. The validity of the Constitution has not been; and cannot be, challenged by any one. With effect from October 12, 1999 an authority unknown to law has purported to suspend the Constitution. It is not for the Petitioners but for the Government to justify this;
So far no justification has been forthcoming. The Written Statement contains a vague reference to the so-called "Doctrine of Necessity". This doctrine, has, firstly, not been defined, secondly; its scope and ambit has not been set out, and, thirdly, it has not been explained as to how it could have been invoked in the circumstances prevailing on that day or how long it will last;
This doctrine has been referred to in the case of Begum Nusrat Bhutto. On the assumption that that case was correctly decided (which assumption is not admitted) there can be no conceivable doubt that the ratio of that case is wholly inapplicable for the following inter alia reasons:
(i)???????? In that case the factual position was that since the elections had been massively rigged there was no Constitutional Government in existence. There being a vacuum it had to be filled in.
(ii)??????? There had been a total collapse of law and order and the civil Government was incapable of controlling the nationwide agitation.
(iii)?????? No legal means existed for filling in the vacuum.
(iv)?????? The C.M.L.A. announced that his sole intention was to hold elections. .
(v)??????? The C.M.L.A. did not have a seven point agenda existing for upto twenty years.
(iv)?????? The Attorney-General made a solemn commitment to the Supreme Court that elections would be held within six months.
(vii) The Chief Justice certified the sincerity of the C.M:L.A. in the above circumstances and observed that it would be very unfair to doubt his commitment.
(viii)The avowed intention of the C.M.L.A. was to preserve the Constitution.
(ix)?????? The C.M.L.A. did not announce in advance that he would not permit the electorate to elect specified political leaders.
"None of the above criteria are fulfilled in the present case. Therefore, even if the reasoning in Begum Nusrat Bhutto's case was correct that would not justify the Government's stand in the present matter."
"II.?????? We now come to the second question which relates to the correctness of the decision in Begum Nusrat Bhutto. Reliance was placed on the earlier judgment by Munir, C.J. in the case of the Governor-General's Reference, 1955 (hereinafter referred to as the "Reference"). Unfortunately there was no application of mind to the question as to whether the facts of that earlier case were at all applicable in the changed circumstances of 1977. This is despite the fact that the fundamental difference was glaringly obvious. In the earlier case the entire discussion proceeded on the hypothesis that the Head of State had a supreme obligation to take all necessary steps for the preservation of society. Obviously this, is completely different from the present situation.
There was also no application of mind as to the criteria laid down by Munir, C.J. He had stated that:
(i) There must be a condition (i.e. situation) of "absoluteness, extremeness and imminence". In other words, there must be an immediate situation requiring action now for which no Legal remedy is available at all.
(ii) The act must have been done under stress of necessity, and this necessity must be referable to a need to preserve and prevent from dissolution, the Constitution, the State or the Society.
(iii) The act must be done bona fide.
(iv) Additionally the act must only be of a temporary nature and the remedy .must be proportionate, i.e. no more than is necessary to remedy the situation..
"In the facts of the present case. one thing is clear beyond any doubt: whatever the crisis, whatever the emergency, whatever the necessity, there had been a complete resolution in favour of the Army Command within a matter of two hours at most. By that time the Army was in full control, the former Prime Minister had been
dislodged and arrested, the country was completely peaceful and quiet. What then prevents the holding of fresh elections?
"The above is on the assumption that Munir, C.J.'s views regarding the doctrine of necessity are correct. In fact there is a complete consensus in the legal community that his opinion derailed the country from the constitutional track and caused a decisive setback to the nation.
"III. In the Petition an objection has been taken as to the nature of the so-called Proclamation of Emergency. In what way is this different from Martial Law. This objection remains unanswered despite a lengthy Written Statement having been filed by the Government. It follows, therefore, that the Government has no answer to 'this objection either."
Elaborating his above formulations, he submitted that the written statement has not addressed the questions raised. in. the petition, inasmuch as, the petition has been filed by various elected persons whereas the written statement solely targets Mian Muhammad Nawaz Sharif, the former Prime Minister, who is not petitioner in the instant petition, and levels various allegations of mismanagement, corruption and even of hijacking (though sub judice) against him and, thus, seeks to justify the action of 12th October, 1999. He argued that assuming that Mian Muhammad Nawaz Sharif was guilty of various charges levelled against him in the written statement, but this fact does not justify that the Constitution, which is the real petitioner, should be condemned and the constitutional dispensation should come to an end. He further submitted that it is the blessing of the Constitution that various office holders including the Judges of this Court and the Attorney?-General for Pakistan are holding their respective offices.
Mr Khalid Anwar then dilated upon the significance of judicial power which, according to him, means that the Court can strike down a law as the Supreme Court did in Mehram Ali's and Sh. Liaquat Hussain's cases. He emphasised that the nature of judicial power and its relationship with jurisdiction are all allied concepts and contended that one facet of judicial power cannot be taken away though jurisdiction can be curtailed but this has to be decided by the Court itself. He submitted that the concept of judicial review was laid down in the United States by Chief Justice John Marshal in the case of William Marbury v. James Medison (2 Law Ed. 60), wherein the US Supreme Court had observed that it Vas inherent in the nature of judicial power that the Constitution was regarded as the supreme law and any law or act contrary to it or infringing its provisions was to be struck down by the Court and that this was the duty and function of the Court to enforce the Constitution. He argued that the concept of judicial review did not exist in England because the supreme law in England was that the Queen in Parliament can do anything and that once an Act of Parliament had been passed, the Courts were to follow it. The Founding Fathers of the United States Constitution, however, deviated from it and in doing so indeed followed the view expounded by Montesquieu in his treatise "Spirit of Law", which enumerates the concept of separation of powers: the judicial, the legislative and the executive powers, who based his opinions on the practice, but not the law of England, in that, in practice, there was separation of powers in England but constitutionally that was not. He submitted that unlike Constitution of Pakistan, the Constitution of United States does not confer power on the Supreme Court to strike down laws but the Supreme Court of United States stated so in the case of William Marbury v. James Medison (supra).
Mr Khalid Anwar then analyzing the Proclamation of Emergency, posed two questions: (i) what was the source of power to issue the Proclamation and (ii) what was the nature of power that had been exercised, and contended that so far as the deliberations/discussions of the Chiefs of the Armed Forces and Corps Commanders were concerned, these were only a historical fact and not a source of power. He argued that a Proclamation of emergency can never be a source of power and that an `emergency' issued under Article 232 of the Constitution does not include the power to suspend the Constitution, therefore, the power so exercised under the present Proclamation of Emergency was a new concept, unknown to the jurisprudence of Pakistan. The learned counsel further argued that as per the Proclamation, respondent has assumed the office of Chief Executive whereas no such office exists, though the office of Chief Executive did exist in the Original Constitution under Article 90, prior to adoption of 8th Amendment, which reads thus:
"90?????? (1) Subject to the Constitution, the executive authority of the Federation shall be exercised in the name of the President by the Federal Government, consisting of the Prime Minister and the Federal Ministers which shall act through the Prime Minister who shall be the Chief Executive of the Federation."
Mr Khalid Anwar then went on to quote the definition of "Proclamation" given in Black's Law Dictionary, which is as follows:
"Proclamation. ---The act of publicly proclaiming or publishing; a formal declaration; an avowal; a public announcement giving notice of a governmental act that has been done or is to be done. The act of causing some governmental matters to be published or made generally known. A written or printed document in which are contained such matters, issued by proper authority, usually by a high governmental executive (President, Governor, Mayor).
"The declaration made by the bailiff, by authority of the Court, that something is about to be done.
"In equity practice, proclamation made by sheriff upon a writ of attachment, summoning a defendant who has failed to appear personally to appear and answer the plaintiff's bill."
"A still better illustration, however, at once of the actual tractability of parliaments and of the theoretic supremacy of king in parliament is afforded by an act of 1539, which has been called the Lex Regia of England, and the most extraordinary act in the Statute Book -power was given to the king to make proclamations with the advice of his council, or a majority of his council, to make proclamation which should have the force -of statutes; the punishment for disobedience might be fine or unlimited imprisonment; it was not to extend to life, limb, or forfeiture. This act was repealed in the first year of Edward VI - you will at once see the importance of its enactment and its repeal; they seem distinctly to confirm the doctrine that the king is not supreme, king and parliament are supreme; statute is distinctly above ordinance or proclamation; statute may give to the king a subordinate legislative power, and what one statute has given another statute may take away."
"This act, however, was at once repealed on the accession of Edward VI, by a statute of 1547???? ???????????
"We must now look at the powers wielded by the king with the assistance of his council. We will bring the subject under four heads - (1) legislation, (2) taxation, (3) judicature, (4) administration??."
"In 1610 the commons protested - `it is the indubitable right of the people of this kingdom not to be made subject to any punishment that shall extend to their lives, lands, bodies or goods, other than such as are ordained by the common laws of this land, or the statutes made by their common consent in parliament???????By reason whereof there is a general fear conceived and spread among your majesty's people, that proclamations will, by degrees, grow up and increase to the strength and nature of laws.' To all this, and there is more of it, the only answer is that the proclamations shall go no further than is warranted by law."
"Before this answer was given the great oracle of the law had been consulted. Coke, then Chief Justice of the Common Pleas, was summoned to the council, and the question was put to him, whether the king by proclamation might prohibit the erection of new buildings in London and the making of starch from wheat. He was pressed to answer in the affirmative. He refused to answer without consulting his brethren. He consulted with three Judges, and they answered that the King cannot by his prerogative create any offence which was not one before, but. the King may by proclamation admonish all his subjects that they keep the laws and do not offend them upon punishment to be , inflicted by the law-neglect of a proclamation aggravates the offence; lastly, if an offence be not punishable in the Star Chamber, the prohibition of it by proclamation cannot make it so. This probably was sound law-that is to say, there was a distinct precedent for it coming from the middle of the Tudor period. In Mary's reign the Judges had delivered this opinion: "The King, it is said, may make a proclamation quoad terrorem populi, to put them in fear of his displeasure, but not to impose any fine, forfeiture, or imprisonment: for no proclamation can make anew law, but only confirm and ratify an ancient one.' But though James I had the opinion of his Judges against him, still he went on issuing proclamations. It is difficult for us to realize the state of things -?that of the Government constantly doing what the Judges consider unlawful. The key is the Court of Star Chamber--the very council which has issued these proclamations enforces them as a legal tribunal, and as yet no one dares resist its judicial power."
"(2) It seems probable that at the beginning of Elizabeth's reign the opinion of the Judges was taken by the council as to the legality of these impositions, and that their opinion was not favourable. The queen, however, did not abandon the impost, that she herself set an impost on sweet wines. James imposed a duty on currants over and above the tax which was set on them by the statute of tonnage and poundage. Bate refused to pay?????I think, we must say that the King succeeded in obtaining from the barons of the Exchequer a declaration that there is a large sphere within which there is no law except the King's will. `The matter in question is material matter of state, and ought to be ruled by the rules of policy; and if so, the king has done well to execute his extraordinary power .... .... .... .... .... .... .... .... .... .... ....They said that the king cannot set impositions upon imported goods at his pleasure, but that he may do so for the good of the people, thus, if foreign princes set taxes on English goods the king may retaliate. Their doctrine seems to have been that the king may not set impositions merely for the sake of revenue, but that he may do so for other ends, as for the protection of English merchants: obviously this is an unstable doctrine ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...They carried a bill enacting that no imposition should be set without the consent of parliament, but the lords rejected it. The immediate consequence had been that in 1608 the king, having the judgment in Bates case at his back, issued a book or rates imposing heavy duties upon almost every article of merchandise. The subject was resumed in the short parliament of 1614; the commons passed a unanimous vote denying the king's right of imposition. They refused to grant any subsidy until this grievance should be redressed. James dissolved the parliament."
It is by means of the judicial power of the Court of Star Chamber that the king enforces his proclamations. We have already said something of this Court. Let us remember that a statute of 1487 (3 Hen, VII, c.I) gave authority to certain persons to punish certain crimes. These persons are the chancellor and treasurer of England and the keeper of the privy seal, or two of them, calling to them a bishop and a temporal lord of the king's council and the two chief justices, or in their absence two other justices. The offences that they are to punish are riots, unlawful assemblies, bribery of jurors, misdoing of sheriff, and some others which we may describe as interference with the due course of justice. It is evidently contemplated by the statute that the accused persons will not be tried by jury. The statute does not mention the Star Chamber, but that is a room which the council has long used ... ... ... ... ... ... ...
(b)??????? It did not confine itself to dealing with the crimes specified in the statute of 1487. Its jurisdiction over crime was practically unlimited, or limited only by this-that it did not pass sentence of death. We know it best as dealing with what may be called political crimes-sedition and the like; but it dealt also with commoner offences-robbery, theft, and so forth. It dealt with some misdoings for which the common law had as yet no punishment, in particular with libels."
"Now was this the Court created by the statute of Henry ~ VII? Under Charles I (for we must anticipate this much) the opinion had gained ground that it was, that consequently whatever it did beyond the. sphere marked out by that statute was an unlawful usurpation of jurisdiction."
"... ... But that it was a tyrannical Court, that it became more and more tyrannical, and under Charles I was guilty of great infamies is still more indubitable. It was a Court of politicians enforcing a policy, not a Court of Judges administering the law. It was cruel in ifs punishments and often had recourse to torture. It punished jurors for what it considered perverse verdicts; thus, it controlled all the justice of the kingdom. The old process of attaint, of which we have before spoken, had long gone out of use, but in the Star Chamber the jurors had- to fear a terrible tribunal which would resent a -verdict against the king."
"On 22nd January, 1655, Cromwell dissolved this body. His third parliament met on 17th September, 1656; it offered him the kingly title which he refused; it instituted an upper house consisting of his nominees, and then fell quarrelling as to whether this was a House of Lords. On 4th February, 1658, he dissolved it; on 3rd September he died."
"The parliament was the Convention Parliament, and of some of its doings we have already spoken. With the King's assent, for Charles was restored in May, it passed an act declaring the dissolution of the Long Parliament; it was dissolved on 29th December, 1666. Charles's second parliament met on 8th May, 1661, and was not dissolved until 31st December, 1678, having, thus, sat between seventeen and eighteen years.
"The second parliament met on 20th May, 1690; it held six sessions and was dissolved in the autumn of 1695. Meanwhile it had passed another Triennial Act-carefully to be distinguished from the acts of 1641 and 1664. It was passed in 1694 (6 and 7 William and Mary,c.2). This act was directed not so much against intermissions of parliament, though it repeated what was already law, namely, that a parliament shall be holden once in three years at least, but against long parliaments: no parliament is -to endure for more than three years-it is then to die a. natural death:"
Mr Khalid Anwar, quoting relevant extracts, traced the history of evolution of the doctrine of necessity' and its ultimate rejection by the British Courts. By referring the case law he contended that thedoctrine of necessity' and Divine Rule by
King/Queen, was buried long ago by the British Courts but in Special Reference
No. 1 of 1955 PLD 1955 FC 435, wherein opinion was authored by Muhammad Munir, the then Chief Justice, this doctrine was resurrected and that doctrine of necessity. was applied in Begum Nusrat Bhutto's case (supra) and the same is now being sought to be employed by the respondents in the present case, though it stands rejected in a recent judgment passed by this Court, in Sh. Liaquat
Hussain's case (supra) PLD 1999 SC 504.
Mr Khalid Anwar, however, elaborated that the `doctrine of necessity' is accepted as a defence in criminal prosecution and tortuous acts, which concept is different from that of State necessity and this Court in the case of Begum Nusrat Bhutto PLD 1977 SC 657, mixed the two and thereby found justification for legalizing Martial Law. He submitted that except 1973 Constitution, all the previous Constitutions had clauses providing 4or acts of indemnity. To substantiate his point of view, the learned counsel referred to a book by Glanville William on "Law of Necessity" at page 216 whereof, under the heading, "The Defence of Necessity" it has been observed:
"The defence of necessity is not so much a current as a perennial legal problem. The Chinese sage Mencius, a contemporary of Plato and Aristotle, was asked by K wan:Is it the rule that males and females shall not allow their hands to touch in giving or receiving anything?' Mencius replied: It is the rule'. Kwan asked: If a man's sister-in-law be drowning, shall he rescue her with his hand?' Mencius said:He who would not so rescue the drowning woman is a wolf. For males and females not to allow their hands to touch in giving and receiving is the general rule; when a sister-in-?law is drowning, to rescue her with the hand is a peculiar exigency.' .
"Notwithstanding the doubts expressed by some modern writers, one can say with some assurance that the defence is recognised by English law. This does not even need judicial authority; it can be proved by a hypothetical example. P is rendered unconscious in an accident, and an immediate operation is necessary to save his life. D, a Surgeon, performs this operation; afterwards P ungratefully prosecutes him for assault. What defence had D? Not the surgeon's usual defence of consent, for here P was unconscious throughout. D's only defence is that of necessity, and it can hardly be doubted that this is open to him." ??
"The law for necessity dispenses with things which otherwise are not lawful to be done'. Sir William Scott said in The Gratitudine (1801): `Necessity creates the law;-it supersedes rules; and whatever is reasonable and just in such cases, is likewise legal'.
"ILLUSTRATIONS OF NECESSITY"
Examples of necessity given in the old books are: pulling down a house to prevent a fire from spreading; jurors departing from the Court without leave of the Judge because an affray breaks out and they are in peril of death; prisoners leaving a burning jail; and jettisoning cargo to lighten a boat in a storm. In modern times the most striking application of the defence was in R. v. Bourne, where necessity was, held to justify abortion."
Reference was also made to the following passages from the above book at page 223, under the sub-heading, "The Theoretical Basis" wherein it has been observed:
"It is time to turn to the theoretical question: What is the basis of the defence of necessity? Bacon thought that an act done under necessity was not voluntary; but we no longer hold that opinion. An act dictated by necessity is still an exercise of the will, as Hobbes pointed out: There is nothing there involuntary, but the hardness of the choice'. Strictly speaking there is perhaps no such thing as necessity, in the context in which lawyers speak of it. A particular act is never necessary, in the sense that there is literally no option, even though the only alternative is one's own death. One is reminded of the Comte d'Argenson's reply to the Abbe who had excused himself for writing scurrilous attacks, on the ground thathe must live'-'I do not see the necessity'.
"What it comes to is this, that the defence of necessity involves a choice of the lesser evil. It requires a judgment of value, an adjudication between competing `goods' and a sacrifice of one to the other. The language of necessity disguises the selection of values that is really involved."
"If this is so, is there any legal basis for the defence? The law itself enshrines values, and the Judge is sworn to uphold the law. By what right can the judge declare some value, not expressed in the law, to be superior to the law? How, in particular, can he do this in the face of the words of a statute? Does not the defence of necessity wear the appearance of an appeal to the Judge against the law?
"The doubts cast upon the doctrine of necessity come from those who fear its abuse; and abused it certainly has been, as in the terrible case of Gregson v. Gilbert (1783), where 150 slaves were pushed overboard, because water was running short. It was under the plea of State necessity that the Star Chamber used the rack to extract information not only from the accused but even from witnesses. Yet it is ancient wisdom that the abuse of a rule does not take away its uses-abusus non tollit usus. `Sir', said Johnson, you must not neglect doing a thing immediately good, from fear of remote evil from fear of its being abused. A man who has candles may -sit up late, which he would not do if he had not candles; but nobody will deny that the art of making candles, by which light is continued to us beyond the time that the sun gives us light, is a valuable art, and ought to be preserved'
"Some fear the effect that an argument of State necessity may have upon private rights and individual liberty. Necessity', declared Pitt. 'is the plea for every infringement of human freedom. It is the argument of tyrants; it is the creed of slaves'
....................... First, Coke: The law of God saith, Non facias malum, ut rode fiat bonum'-thou shalt not do evil, that good may come thereof. On the other hand Wilmot, L.C.J., asserted roundly that the end directs and sanctifies the means'; and Bentham in effect agreed. Bentham's qualifications do not essentially affect his acceptance of the maxim.The end justifies the means. Yes: but on three conditions, any of which failing, no such justification has place."
(1)? One is, that the end be good.
(2) That the means chosen be either purely good, or if evil, having less evil in them than on a balance there is of real good in the end.
(3)??????? That they have more of good in them, or less of evil, as the case may be, than any others, by the employment of which the end might have been attained'.
"Many will think that, even with these conditions, some means are ethically barred irrespective of ends. The opposite doctrine that ends can justify means that lying, trickery and torture are all right so long as you do them from a good motive-is now commonly regarded as being characteristic of Communism and Totalitarianism. There are ethical differences between Communist and free societies, but I do not think they can be stated so simply as this. In England we hang and incarcerate criminals, and such punishments can be justified only by reference to their purpose???"
"In reality the difference between the two views seems to be one of emphasis. Most of us think that the moral values we cherish are, in the long run, more important for society and for human welfare than any gain that may seem immediately to accrue from disregarding them. This attitude does not altogether exclude a saving for necessity."
"Bacon attempted to restrict the doctrine of necessity by saying that it was an-excuse only for invading private rights, not where the act was against the commonwealth. Necessity privileges quoad iura privata, but necessitas publica maior est quam privata. The examples given by Bacon clarify his meaning. You may throw cargo overboard in a storm to lighten the vessel, but not if the cargo consists of ordnance and munitions which you have been commanded to take to relieve a besieged town. You may pull down a -house to stop a fire spreading, but you may not, if attacked in a house, set fire to it as the only way of saving your life. In the latter case, if the fire that you start spreads to a neighbour's house, you are liable to him in damages. Bacon concocted this somewhat fanciful illustration to help his point; there is no judicial authority on it. Bacon went on to say that a man may commit a mere trespass to save his own life; a trespass is not a thing against the commonwealth, as setting fire to houses is. It is clear from this example that what is involved is an assessment of values; the infliction of an evil is justifiable if it is the lesser of two alternative evils
"A second limitation postulated by Bacon was that necessity is no defence where the exigency was caused by the fault of the actor."
"NECESSITY AND PREROGATIVE"
"A further element of confusion arose in public law. At first sight the doctrine of necessity is somewhat difficult to separate from the prerogative. The difference is that the defence of necessity is open to everybody, . while the prerogative relates only to the King????" "On the other hand there were some politically necessary things that only the King could do; these belonged to his prerogative. Thus, he could (and can) erect sea walls and embankments against sea or tide, and enter the land of a subject to do to. It was said that before Magna Carta, c.21, he could take wood for the repair of his castles. He requisitioned ships, subject to the payment of compensation, and by the prerogative of purveyance similarly requisitioned provisions for his household and armed forces, including even the impressment of labour. Such powers rested upon the prerogative justified by necessity. In the Case of the King's Prerogative in Saltpetre (1606), the Judges declared that the King had a prerogative to dig for saltpetre, for the necessary defence of the realm, notwithstanding that gunpowder had been invented within time of memory. The opinion, which was an advisory one, was hedged about with various qualifications, and reads more like a piece of legislation than a statement of existing law. The King was required to restore the place afterwards; and in practice compensation was paid.
"This doctrine of State necessity was brought into bad odour by the excesses of Charles I. Trying to govern without Parliament, Charles justified the exaction of ship-money on the ground of public necessity. Now if it were assumed as a premise that Parliament was not there to grant money, the exaction was necessary, and might reasonably have been regarded as lawful. The weakness in the King's case was that he was deliberately refraining from summoning the constitutional organ for taxation. The necessity was, therefore, a self-induced necessity, which in law is not one at all. Although Hampden lost, when he challenged the tax, it is the subsequent reversal of the decision by a special statute of 1640 that is taken to settle the legal principle."
"Since the Revolution the law may be stated as follows. The King cannot acquire new prerogatives by reference to State necessity. The Case of Saltpetre, though not overruled, is based upon an obsolete political philosophy. However, necessary the behaviour, the Government must today invoke the aid of Parliament if the behaviour involves breaking the letter of the law. It can act under the doctrine of necessity only to the same extent as a private person. Parliament's alleged failure to give adequate powers cannot be an excuse for conduct, because the necessity of the powers claimed is for Parliament to decide, not for the Judges over the head of Parliament. The question is not whether it is necessary to do the act but whether it is necessary to do it without the sanction of Parliament."
"Paradoxically, this seems to give necessity less scope in public than in private law. The doctrine is a dispensing power exercised by the Judges when Parliament cannot reasonably be expected to act. Since Parliament generally can act in great national emergencies, the doctrine is less applicable to these than it is to the minor troubles of individuals."
"This does not altogether exclude necessity in public affairs. At one time the Parliamentarians might have wished to confine it in this way, for they were impressed more by the danger of the notion than by its utility. Milton called necessity "the tyrant's plea"; and Selden said: 'there is not anything in the world more abused than this sentence, salus populi suprema lex esto'. Cromwell declared:
Necessity hath no law. Feigned necessities, imaginary necessities are the greatest cozenage that men can put upon the Providence of God, and make pretences to break known rules by'.' It is this attitude of mind that explains such sweeping judicial utterances as that of Prat, C.J., in Entick v. Carrington (1765):With respect to the argument of State necessity, or a distinction that has been aimed at between State offences and others, the common law does not understand that kind of reasoning, nor do our books take notice of any such distinctions'. Notwithstanding the esteem in which this pronouncement is commonly held, it does not seem to represent the law. Our books do take notice of State necessity in the particular matter of throwing up bulwarks against the enemy, to mention only one. The view of all lawyers who have considered the subject is that the Crown may by necessity use force to quell insurrection or repel invasion; and this is about all that a so-called declaration of martial law within the realm amounts to. It is also clear from Humphrey v. O'Connor
(1864) that a constable may commit what would otherwise be an assault upon an innocent person if that is the only way of preserving the peace."
"A more difficult case of State necessity was presented in R. v. Stratton (1779). The Governor of Madras acted illegally and unconstitutionally in refusing to count the votes of some of the members of his Council. Councillors accordingly imprisoned him for eight months and carried on the Government themselves. Upon being indicted in England they set up the defence of necessity. Lord Mansfield directed the jury that the defence was one of `civil or State necessity'. He remarked:-.
`In India you may suppose a possible case, but in that case, it must be imminent, extreme necessity; there must be no other remedy to apply to for redress; and in the whole they do, they must appear clearly to do it with a view of preserving the society and themselves?????What immense mischief would have arisen to have waited for the interposition of the council at Bengal?'
"The jury returned a verdict of guilty. Notwithstanding Lord Mansfield's direction, it may be doubted whether the doctrine of necessity is appropriate to such politically harmful effects as the defendants in that case tried to avoid. In all other cases where the doctrine of necessity has been invoked, the harm sought to be avoided was of an immediate and physical kind. It is submitted that indirect social evils are for the consideration of the legislature, and do not fall within the purview of the doctrine."
"Indeed, in most societies the Courts are the means, recognized by rulers and ruled alike, through which questions of validity and legitimacy are resolved. In practical terms, then, whether the `ruled' can be taken to have accepted the validity of the rule-making authorities and, indeed, whether there exists a 'juristic postulate' about this validity depends upon whether this validity has been accepted by the Courts. Jurisprudence can in this way recognize that a society whose judicial agencies accept its rulers as legitimate is radically different from one in which this acceptance is lacking.
Rules and Principles
"If the Courts choose to.
follow their duty and apply the law' so defined, an absurd result could be reached. If an absolute monarch died without making provision of a successor, thelaw' would compel them to insist on regarding him as the lawful ruler. To avoid such futility, it would be reasonable to limit the legitimacy of a ruler to the period in which he remains in effective power."
Constitutional Principles
"The present purpose is not to attempt to make an exhaustive list of the kinds of principles that may be relevant to a decision whether revolutionary activity should be given legal justification, but the more limited one of salvaging this area of investigation from total extinction by the operation of positivist dogmatism. But it may be helpful to set out some of the principles which may be pertinent to revolutionary situations:
1.???????? The principle of effectiveness.
2.???????? The principle of legitimate disobedience to authority exercised for improper purposes.
3.???????? The principle of necessity.
4.???????? The principles that violation of a right demands a remedy and that no one should profit from his own wrongful act. As a .revolution will invariably have involved the violation of some of the `rights' protected by the previous Constitution, a combination of hose principles suggests that, even if the new order is considered legitimate, some recompense should be offered to those whose rights were infringed.
5????????? The principle that a Court will not permit itself to be used as an instrument of injustice.
6????????? The principle that it is in the public interest that those in de facto impregnable control should be accorded legal recognition. This was the main principle upon which the four Commonwealth tribunals rested their decisions. Put more crudely, the principle states that might, once established, ipso iure becomes right. It gives effect to the acceptable policy value that it is in the interest of the community that order be preserved. But one might be reluctant to hold that it is the only relevant principle and that there cannot be others which would militate against automatically accepting revolutionaries as legitimate regardless of any other circumstance..
7????????? The principle, common to both public and private international law and which Grotius considered a central tenet of natural law, that promises are to be kept: pacta sunt servanda. A Government elected under a Constitution expressly or impliedly pledges with the electorate that it will hold to the Constitution. If it abrogates that Constitution, it breaks faith with the electorate and, therefore, contravenes this principle unless and until it submits itself once more to the same electorate to express its acceptance or rejection of the action.
8????????? The principle that government should be by the consent of the governed, whether voters or not. There is nothing new in this principle. Authority can be found in political writings at least from the Middle Ages to the present day.
9????????? International law now probably supports the principle of the right to self-determination and of the unacceptability of relied discrimination. As the Rhodesian Court, in particular, relied heavily on an appeal to international law for support for the principle it in fact applied (that revolutionary success demands legal recognition) it would have been proper to have weighed against that principle other norms of international law relevant to the situation."
Authority of the Court
"In concluding the defence of the proposition that principles of the kind enumerated above may properly be taken into account by a Court in order to determine whether or not to uphold the legitimacy of a revolutionary regime, it is necessary to consider two oblique arguments which would attempt to undermine it. One is to take theoretical objection to the jurisdiction of a Court which indulges in the exercise. The claim is that, as the Court acquired its authority to determine disputes by 'virtue of jurisdiction conferred on it by the old Constitution, the disappearance of that Constitution implies the collapse of the court's own authority. The other argument is the severely practical one that, whatever the legal theorist or the Judges may say, any Court making a finding adverse to a revolutionary regime is certain to be disbanded so that in reality a judiciary will be allowed to function only if it is subservient to the new regime.
"The second questionable premises is that by suffering the Court to continue to function, the new executive thereby assimilates the Court into its own revolutionary order and that this compels the de jure recognition of the Government. But against this it might be urged that the very .submission by the revolutionaries to litigation before the Court concerning their own legitimacy suggests that the Court may have an inherent authority arising. from the submission of both parties, rulers and ruled, to its jurisdiction.
"The dismissal of Judges is an extreme step which might have dangerous domestic and international consequences for a revolutionary executive. Nor should it be too readily assumed that a regime which takes this step will easily find a replacement judiciary without leaving itself open to ridicule???????.Had the Rhodesian Court, for example, held that the revolutionary regime could be considered lawful only if confirmed in office by the electorate which had elected them under the old Constitution and if some satisfactory evidence was produced that the new Constitution was broadly acceptable to the majority of the population (in accordance with principles 7 and 8 listed above) is it inconceivable that the regime might have preferred to attempt to comply with that? finding rather than to dismiss the Judges? The opportunities open to the judiciary to influence the course of events should not be dismissed out of hand. It may be that this is unaccustomed territory for the judiciary to enter. But this is rue for many areas of law in modern times, especially with respect to the interaction between the executive and the citizen. It is hard to believe that our legal and cultural tradition is too weak to develop sound and acceptable??????????? principles in this new context. But in order that they may take root, it is necessary to rid ourselves of the conceptual block which would forever bar the entry of juristic thought into this domain. "
41.?????? According to the learned counsel the history of civilization is indeed he history of evolution of the doctrine of separation of powers. Thus, no matter if one is the wisest such as Socrates, the most knowledgeable such as Aristotle and the most virtuous such as Imam Abu Hanifa, all need be subject to the limits of checks and balances to prevent tyranny. He then quoted references from the book titled CASES IN CONSTITUTIONAL LAW authored by D. L. KEIR and F. H. LAWSON, 5th Edition, at pages 73 to 116, which are as follows:
"By the word prerogative we usually understand that special pre?eminence, which the king hath, over and above all other persons, and out of the ordinary course of the common law, in right of his regal dignity. It signifies, in it's etymology (from prae and rogo), something that is required or demanded before, or in preference to, all others. And hence it follows, that it must be in it's nature singular and eccentrical; that it can only be applied to those rights and capacities which the king enjoys alone, in contradistinction to others, and not to those which he enjoys in common with any of his subjects: for if once any one prerogative of the crown could be held in common with the subject, it would cease to be prerogative any longer. And, therefore, Finch lays it down as a maxim, that the prerogative is that law in case of the king, which is law in no case of the subject."
"1.??????? The King's `special pre-eminence' carried with it certain property rights which he enjoyed as feudal lord and conferred on him certain advantages in litigation. Such had throughout the Middle Ages been the meaning generally, and almost solely, attached to the term Prerogative. The apocryphal statute Praerogativa Regis, in the thirteenth century, was wholly concerned with the King's exceptional rights as feudal lord. The chief among his advantages in litigation was that he could not be made defendant to an action at law; this was hardly a prerogative in the earlier Middle Ages since it was shared by other lords, being. merely an application of the feudal rule that a lord cannot be sued in his own Court. It later came quite correctly to be regarded as a prerogative; for which the King's Courts had become national Courts and absorbed the greater part of the legal business of the country, the King's immunity ceased to have any real connexion with feudalism. It was further recognized that the King's goods and chattels were under no tribute, toll, or custom, nor otherwise distrainable. Such prerogative as these were capable of full enumeration and description. They were that part of the common law which concerned the King, and could be discussed and applied by the Courts in West-minister Hall."
"2.??????? But the Stuarts had also inherited from their medieval predecessors powers of Government which were not so defined. True, the medieval lawyers had held the view that the law was a bridle on the King, and in their famous maxim, `The King can do no wrong', they had insisted that his power extended to do only what was right. They held, further, that the King could do certain things only in certain ways??????.."
"Yet even in the exercise of his residuary powers he was considered to be subject to law. The power of supplementing and overriding positive law was given to him, not that he might arbitrarily exert his own personal will, but that he might provide for cases where the positive law either was insufficient or worked injustice. Moreover, he was in practice dependent for the execution of his decisions on the cooperation of persons whom he could not effectively control. The characteristic vice of Government in the later Middle Ages was not the arbitrary power but the executive weakness of the King."
"It was expressed in the maxim that the King can do no wrong. This maxim lost its medieval significance and came to mean first that no intention of abusing his power can be attributed to him, and finally that whatever he does is right.
"The gist of the decision was that the King might impose what duties he pleased if it was only for the purpose of regulation of trade and not of raising revenue, and the Court could not go behind the King's statement that the duty was in fact imposed for the regulation of trade."
"We are of opinion, that when the good and safety of the kingdom in general is concerned, and the whole kingdom in danger, your majesty may, by Writ, under the Great Seal of England, command all the subjects of this your kingdom, at their charge, to provide and furnish such number of Ships, with men, munition, and victuals, and for such time as your majesty shall think fit, for the defence and safeguard of the kingdom from such danger and peril; and that by law your majesty may compel the doing thereof, in case of refusal or refractoriness. And we are also of opinion, that in such case, your majesty is the sole Judge, both of the danger, and when and how the same is to be prevented and avoided."
"Recourse must be had to ordinary means before extraordinary, but if the latter are . necessary (and Salus populi suprema lex) a parliament should be summoned."
"2. The Parliament moves too slowly to be consulted in an emergency. Answer: even in the Statute of Proclamations, 31 Hen. 8, which was made to provide for emergencies, power to tax by proclamation without parliamentary consent is expressly excluded. 3. Some time the existence of danger will justify taking the subject's goods without his consent. Answer: admitted, but this is only in case of immediate danger, when the necessity of self ?preservation overrides all law. It is not a prerogative, but belongs equally to every subject, and cannot be used to justify an invasion of property except where the necessity is immediate. A similar right is admitted to exist while war is actually raging, but that is on the principle, inter arma silent leges.
"But in times of war, and when salus populi was at stake, private property must give way to the common good. Quod necessitas cogit, defendit. And this not only when war is actually raging, but also upon rumours of wars. Matters of war and peace are for the King; sometimes dangers are not fit to be communicated to the people, and yet it is very fit that preparation be made beforehand."
"HOLBORNE (for the defendant) refused to admit that the King's allegation of imminent danger was conclusive, and contended that the allegation was not clearly set out on the face of the writ.
"[To state this argument in the language of the twentieth century, parliament is established to limit the power of the king; how can it do so, if he may tax whenever he chooses to allege the existence 'of an emergency?]
"[The modern counterpart of this argument would be that the law will not give him a power which he might be tempted to use to interfere wrongfully with the property of the subject.] He is said, it is admitted, to judge of the necessity, but `in judgment so to do it, is all one as to leave it to him arbitrarily, if he will, which is that only which was intended to be prevented.'
"It is admitted that the subject must serve in case of necessity, but only in person; if his goods are to be taken the necessity must be immediate, and mere rumours of wars or apprehension of danger are not enough."
"I never read nor heard, that Lex was Rex; but it is common and most true, that Rex is Lex, for he is lex loquens', a living, a speaking, an acting law: and because the king islex loquens', therefore, it is said, that `rex censetur habere omnia jura in scrinio pectoris sui.'
"iii???????? The Judges who decided them have been denounced as time-servers or traitors, but it is by no means certain that they decided contrary to law."
"But in fact the. parliamentary lawyers found it difficult, having gone so far, to deny that the King had the best means of knowing about foreign affairs, and was the fittest person to judge of an emergency."
"that the people's liberties strengthen the king's prerogative, and that the king's prerogative is to defend the people's liberties."
"The absolute power of the king is not that which is converted or executed to private use, to the benefit of any particular person, but is only that which is applied to the general benefit of the people, and is salus populi; as the people is the body, and the king the head; and this power is [not] guided by the rules, which direct only at the common law, and is most properly named Policy and Government; and as the .constitution of this body varieth with the time, so varieth this absolute law; according to the wisdom of the king, for the common good; and these being general rules and true as they are, all things done within these rules are lawful."
Prerogative (iv)
"Much of the contents of the Prerogative perforce disappeared when the Star Chamber was abolished. They could not be exercised without the intervention of a Court. The prerogative of executing martial law, at any time of peace, had already been taken away by the Petition of Right; so had the power to commit per special mandatum regis. The decision in R. v. Hampden hadbeen reversed by a special Act. The Crown still had full legal control of foreign policy, and prerogatives such as the power of dissolving parliament, of appointing to offices and of pardon. But these prerogatives could not affect the property of the subject. Arid from the time of the Long Parliament it had been clear that wherever any prerogative came into conflict with the exclusive right of Parliament to tax, it must give way to it."
"There was one doctrine of the Prerogative and one prerogative right which were dangerous to Parliament, and were not yet dead. Nothing had been done directly to kill the notion that certain prerogatives were inseparably annexed to the Crown, so that no statute could avail to take them away, and no attempt had been made to destroy the dispensing power. The Restoration period, and especially the reign of James II, showed that unless Parliament could contrive to advance still further, all was not irreparably lost to the Crown. By means of dispensations, the King could legalize anything which was no malum in se, provided his dispensation deprived no third party of his rights; that is to say, his dispensing power could have no effect where property or private law was at stake, but could be used to evade a statue which expressed the wishes of Parliament on a point of public law. Moreover, because the prerogative to dispense with statutes, was looked upon as inseparably annexed to the Crown, there was no means of curbing the power of a king who did not owe his authority and even his title to Parliament."
"But this writ and the Star Chamber both disappeared in the time of the Long Parliament. Hence that portion of the Prerogative which could be exercised only through the intervention of a Court disappeared for good in 1641. Nor can it be revived, for the Privy Council case of In re Lord Bishop of Natal (p.113 below) clothed with judicial authority the doctrine. found in the old books, that the King by his Prerogative cannot establish a Court to administer any but the common law, and as such a Court would nowadays be almost useless, it is very unlikely that his prerogative will be exercised??????"
"The rest of the prerogative might survive, but only subject to the approval of the ordinary Courts. In every case the King must make good at common law his claim to the prerogative; the mere plea of prerogative no longer ousts the jurisdiction of the Court. The plea of matter of State has no more .force than the plea of prerogative; further, inasmuch as the common law knows no matter of State except such as is comprised in the more force than the plea of prerogative; further, inasmuch as the common law knows no matter of State except such as is comprised in the. more convenient and technical term Prerogative, there was no point in keeping two phrases where one would do???.."
But the idea that Government is, apart from Prerogative, entitled to special treatment died very hard. In Carr's Case (1860), 7 St. Tr. 929, Scroggs, C.J. went so far as to say, `If you Write on the subject of Government, whether in terms of praise or censure, it is not material; for no man has a right to say anything of Government'. The modern view was first clearly stated by Lord Camden in his famous judgment in Entick v. Carrington.
"With respect to the argument of State necessity, or a distinction that has been aimed at between State offences and others, the common law does not understand that kind of reasoning, nor do our books take notice of any such distinctions."
"Those powers which the executive exercises without Parliamentary authority are comprised under the comprehensive term of the prerogative. Where, however, Parliament has intervened and has provided by statute for powers, previously within the prerogative, being exercised in a particular manner and subject to the limitations and provision contained in the statute, they can only be so exercised. Otherwise, what use would there be in imposing limitations, if the Crown could at its pleasure disregard them and fall back on prerogative?"
"7. Since the Case of Proclamations (p.110 below) it has been clear law that the Crown could not create a new offence except by Act of Parliament, and it had always been understood that un?parliamentary legislation of every kind was against the law ......
"A controversy of land between parties was heard by the King, and sentence given, which was repealed for this, that it did belong to the common law: then the King said, that the thought the law was founded upon reason, and that he and others had reason, as well as the Judges: to which it was answered by me, that true it was, that God had endowed His Majesty with excellent science, and great endowments of nature; but His Majesty was not learned in the laws of his realm of England, and causes which concern the like, or inheritance, or goods, or fortunes of his subjects, are not to be decided by natural reason but by the artificial reason and judgment of law, which law is an act which requires long study and experience, before that a man can attain to the cognizance of it: that the law was the golden met-wand and measure to try the causes of the subjects; and which protected His Majesty in safety and peace with which the King was greatly offended, and said, that then he should be under the law, which was treason to affirm, as he said; to which I said, that Bracton saith, quod Rex non debet esse sub homine, sed sub Deo et lege. "
?It is a settled Constitutional principle or rule of law, that although the Crown may by its Prerogative establish Courts to proceed according to the Common Law, yet that it cannot create any new Court to administer any other law; and it is laid down by Lord Coke in the 4th Institute, that the erection of a new Court with a new jurisdiction cannot be without an Act of Parliament."
"That which concerns the mystery of the King's power is not lawful to be disputed; for that is to wade into the weakness of Princes, and to take away the mystical reverence that belongs unto them that sit in the throne of God .... As for the absolute prerogative of the Crown, that is no subject for the tongue of a lawyer, nor is lawful to be disputed. It is atheism and blasphemy to dispute what God can do; good Christians content themselves with His Will revealed in His Word: so it is-presumption and high contempt in a subject to dispute what a King can do, or say that a King cannot do this or that, but rest with that which is the King's revealed will in his law. "
"Bacon was by far the greater man, for in him the philosopher included both the lawyer and the statesman; and thinking after the manner of a philosopher he advocated a large reform of English law. Coke on the other hand, with, a mind fanatically narrow, was possessed with a profound veneration for the law as it stood-for its technicalities as well as its substance-and he was convinced that it was not by change and reform but by the following of precedents that the liberties of England were to be defended. Thus, upon one of the great test questions in the politics of the time-the nature and limits of the royal prerogative-Bacon half suggested, half accepted the mystical views of James; while Coke resolutely opposed the inferences which the King drew from the principles which he laid down, and entrenched himself in precedents, and verbal interpretations of statute law. Coke's idea was that the Bench should be independent of the Crown and should act as arbiter of the Constitution to decide all disputed questions. Bacon, on the other hand, referred all disputed questions to the King, saying, with his mind running upon the ivory throne on which King Solomon sat to give judgment, that the Judges. `should be lions, but yet lions under the throne'. This Coke represented a rigid conservatism-the conservatism of Constitutional liberties as they were; Bacon represented reform-but reform carried out by a philosopher-king wielding a sovereignty unlimited and half-divine. We shall come upon the same antagonism again, a generation later, in the persons of Pym and Strafford."
"But that State is rare in which the kings are philosophers or the philosophers kings. Bacon was not a king, and James was not really a philosopher. The philosopher had. fallen on evil days, for the kings were Stuarts; and what was really needed was the conservation of existing liberties against encroachment, and not the efficient paternal Government which Bacon and Strafford dreamed of but which-James and Charles could never hope to attain."
"In the eyes of his contemporaries Coke's legal fame overtopped his other claims to greatness. In 1631, when his death was expected, Charles I gave orders that his papers should be secured, lest anything against the prerogative should be found among them and published, for he is held too great an oracle among the people, and they may be misled by anything that carries such an authority as all things do which he either speaks or writes.'His parts', says Fuller, `were admirable; he had a deep judgment, faithful memory, active fancy; and the jewel of his mind was put into a fair case ...His learned and laborious works on the laws will last to be admired by the judicious posterity whilst Fame has a trumpet left her and any breath to blow therein."
"The Petition of Right dealt first with the two main grievances of arbitrary taxation and arbitrary imprisonment, providing (1) That no man hereafter be compelled to make or yield any gift, loan, benevolence, tax, or such-like charge, without common consent by Act of
Parliament', and (2) That no free man be detained in prison without cause shown. But to these were added two other grievances which had been felt bitterly by the humbler classes: the billeting upon them of Buckingham's disorderly levies, and the attempt which had been made, not so much to enforce discipline among the soldiers as to punish ordinary crimes committed by soldiers by the application of martial law instead of the ordinary law of the land. It was, therefore, further provided, (3) that soldiers and mariners should not be billeted upon inhabitants against their wills, thus, recognising the ancient custom,no man is forced to take soldiers but inns, and they to be paid by them'; and (4) that commissions for proceedings by martial law `against soldiers and mariners or other dissolute persons joining with them' be revoked, and no fresh commissions be granted in time to come.
"The King fought hard to save his emergency power of imprisoning without showing cause. The petition, he said, involved the very intermitting of that constant rule of Government practised for so many ages within this Kingdom', and it would soondissolve the foundation and frame of our monarchy'. The middle party in the Lords tried to save the situation for him by proposing the addition of a saving clause:"
"On March 10, 1629 an abrupt dissolution followed, the most gloomy, sad, miserable day for England that happened in five hundred years last past'. But for the present the victory was with the King, for it was only in Parliament that he could be fought. Sir
Benjamin Rudyerd, the reasonable Parliamentarian, who had said in the House on
April 28, 1628, thatmoderation is the virtue of virtues and the wisdom of wisdoms', recognises this."
"The King took quite a different view of Parliaments. They are of the nature of cats', he wrote to
Wentworth later,they ever grow cursed with age'. He now inflicted on the nation the 'loss of Parliaments' for a period of eleven years. This opened the way for him to take vengeance on his enemies, and his prosecution of Eliot and other leaders of the Common was to illustrate the truth of Wentworth's own observation, that it was ill contending with the King outside of
Parliament."
"The decision in Hampden's case also caused a 'general loss of confidence in the Courts of law. As Clarendon points out, ship?money had been declared lawful 'upon such grounds and reasons as every stander-by was able to swear was not law'. The reasoning of the Judges 'left no man anything which he might call his own', and all men 'found their own interest, by the unnecessary logic of that argument, no less concluded than Mr. Hampden's'. It is not necessary to go so far as Hallam, and to say, 'Those who had trusted in the faith of the Judges ...looked with indignation on so prostituted a crew'; but the parliamentary leaders now perceived that the majority of the Judges was likely to be always against them, even if the minority was not dismissed. This knowledge made Parliament a necessity for them. They had nothing to hope for from the Judges, who were leaving them to work out their own salvation independently of the Courts of law; and the only other place where salvation was to be found was in Parliament. "
"2. Judicial Control of the Executive and other Authorities.
"It is an essential duty of the executive Government to obey the law of the land, whether or not there is any means of compelling it to do so, and the judiciary has an absolute duty to restrain actions of the executive which are illegal. It cannot refrain from doing so because of any considerations of State convenience; the ancient doctrine of Entick v. Carrington (1765), 19 St. Tr. 1029 is perhaps hardly likely to be ignored in Britain itself, but it has been found desirable to remind colonial Courts that they must give it full effect, even if it should be found that to do so may interfere with the convenience of the administration. In fact, as shown in discussing the rights of the subject, the Courts have been busy in recent years in reasserting the principle that Parliament alone can impose taxation, and the executive must not do so without precise authorisation; that interference with liberty must be strictly justified by law, and is not to be excused merely because the person affected might be treated by the crown as an enemy, though it has not done so; or because, under earlier regulations made inoperative by the creation of the Irish Free State, arrest and deportation of an alleged revolutionary would have been legal."
"It rests with the Courts to define and by doing so limit the prerogative power of the Crown, a term the extent of which has been a subject of some discussion in recent years."
He made a distinction between the necessity and prerogative by stating that doctrine of necessity may be availed by all citizens but the prerogative is for the King and as of "Glorious Revolution" 1688, no new prerogative may be created by reference to doctrine of necessity. He emphasised that the liberty to choose is an important right and that common wisdom ought to be given more weightage than that of the wisdom of one man. He reiterated that doctrine of necessity was rejected in Britain since 1765. Elaborating that Martial Law is justified only to quell insurrection or riots or rebellion from within and invasion from outside, he argued that the insurrection, riots and rebellion are ex facie, an assault on the Rule of Law, therefore, to curb an unconstitutional action, this measure can be adopted. He, however, vehemently contended that Martial Law is not meant to be an instrument of social reform or economic progress as envisaged in the 7-point Agenda of the Chief Executive, therefore, though this Agenda is admirable and noble but the suspension of the Constitution could not be justified for the sake of realizing the same. - He next submitted that social reform and economic progress are in the best interest of the nation which takes place under the law and not in violation thereof.
He submitted that R v. Stratton (1779) (21 St.Tr.1222), which was relied upon by Muhammad Munir, C J, provided that the 'doctrine of necessity' may be relied upon only in imminent danger and extreme necessity so as to preserve the society, when no other remedy for redress is available, in that, this doctrine is detrimental to political system. He next submitted that the task of removing the social evils be left for the consideration of the Parliament and should not be undertaken under the doctrine of necessity.
Mr Khalid Anwar then read the speech of the Chief Executive dated 17-10-1999 and formulated the following propositions:-
"(1) That though the speech claims occurrence of deterioration of the system in a period of 52 years and lays emphasis on the Provincial autonomy but the same is restricted by the PCO.
(2)??????? That the Chief Executive accepts in unqualified terms the importance of the Constitution by saying that in earlier Martial Laws the Constitutions were abrogated and politicians condemned, therefore, there was no justification for issuance of proclamation of emergency on the 12th October, 1999 to suspend the Constitution.
(3)??????? That the Chief Executive states that he was not imposing the Martial Law and the present period is a pause to democracy.
"Pakistan's Constituent Assembly met in Karachi for the first time on August 11 and unanimously elected Jinnah to preside over its meetings, amid thunderous applause, as its first business. Jinnah took the chair, thanking the assembled delegates for the greatest honour that is possible for this Sovereign Assembly to confer-by electing me as your first President ....I sincerely hope that ....we shall make this Constituent Assembly an example to the world. The Constituent Assembly has got two main functions to perform. The first is the very onerous and responsible task of framing our future Constitution of Pakistan and the second of functioning as a full and complete Sovereign body as the Federal Legislature of Pakistan. We have to do the best we can ...."
Mr Khalid Anwar submitted that in Begum Nusrat Bhutto's case (supra) there was Martial Law and the CMLA claimed vast powers including power to amend the Constitution and this Court granted him that power. He further submitted that the circumstances in which the powers to amend the Constitution were granted to CMLA have been referred to in Mehmood Khan Achakzai's case (supra), which 'show that the need for granting the power to amend the Constitution arose, in that the then Chief Justice, who had assumed the office by virtue of nullification of 6th and 7th Constitutional Amendments by the CMLA, would have, ipso facto, lost that office if power to amend the Constitution had not been granted. He further submitted that this Court should not confer such power on the Chief Executive. He next submitted that the Court should examine the scope/ambit of emergency promulgated by the Chief Executive, which is not envisaged by the Constitution, to determine as to what this emergency entails and under its cover what the Government can do and cannot do. He emphasised that the curse of the country is not less laws instead more laws, but no enforcement thereof. He also made a reference to the example of Chancellor Halmet Kohl of Germany and Finance Minister of France, who were involved in financial bungling and rightly condemned but without impinging upon the system of Constitutional governance. He argued that every law has two facets: (1) what is the content of the law and (2) who has the power to make it. He drew a distinction between Martial Law and Emergency to contend that the Martial Law is a nullification of the Constitution whereas the present emergency is claimed to have been imposed to save the system, therefore, minimum period should be taken for restoration of democracy.
Mr Khalid Anwar submitted that it would be improper to impute responsibility for writing judgment in Begum Nusrat Bhutto's case to Anwarul Haq, the then Chief Justice alone, who was only a primus inter pares (first among equals), in that, indeed, it was a decision, which was given by the Court, comprising all the Judges on the Bench then.
He submitted that it is not the judicial function of this Court to pronounce upon the competence, ability and integrity, especially of four rulers/politicians, namely, General Muhammad Ziaul Haq, General Agha Muhammad Yahya Khan,, Mohtarma Benazir Bhutto and Mian Muhammad Nawaz Sharif. He referred to the case of Begum Nusrat Bhutto wherein this Court relying on the statement of Mr Sharifuddin Pirzada, the then Attorney-General, appdaring on behalf of the respondents therein, observed that the election would1 be held in six month's time or as soon as the accountability process is completed and that the petitioner's counsel when asked for a framework for election to be determined, the Court responded that it would be unfair t o cast doubt on the sincerity of CMLA, to contend that it is no part of the judicial power of the highest Court of the land to pass a verdict on the sincerity or insincerity of the rulers whether civilian or military and prayed that Rio such edict should be issued by this Court on the present ruler. The learned counsel next submitted that the conditions prevalent at the time of promulgation of Martial Law in 1977 were like rebellion/resurrection, in that, as per determination of the Chief Election Commissioner, the elections conducted earlier in March that year were a farce, therefore, there was no Constitutional justification for the Government to remain in power and the Supreme Court, which is the ultimate guardian/custodian of the constitutional values had to find a bridge for bringing the country back to legal/constitutional dispensation. He argued that the doctrine of unwritten limitations on the judicial power has a long heritage in American Constitutional law and that the Courts refrain from entering into the political environment to determine a political question, in that, it is a dangerous/perilous terrain for the Court to tread. He argued that the foundation of power of the Court is ethical, resting upon the prestige and dignity of this august institution, therefore, every Government is in need of seeking from the Court the seal of legitimacy for its powers. He submitted that the judicial powers are the weakest and the most powerful. Mr. Khalid Anwar submitted that this Court should not authorize the Chief Executive to take political decisions and it should restrict him within legal/constitutional limits. In support of his contentions, the learned counsel relied upon certain passages from the research paper titled `Judging the State' by one Paula R. Newberg.
The learned counsel argued that Article 58(2)(b), which authorized the President to dissolve the National Assembly, now repealed by virtue of the 13th Amendment, is, sometimes, referred to as a safety valve and that with the removal of that safety valve the continuance of the Constitutional governance has been placed in jeopardy, was not, in fact, a safety valve but a valve to control the flow of democratic power. He submitted that Article 58(2)(b) was borrowed from a similar provision i.e. section 45 of the Government of India Act, 1935, which was repealed on 14th August, 1947 by PCO-22 of 1947. He submitted that the scope of Article 58(2)(b) was even wider than section 45 of the Act of 1935. He then referred to Article 58(2)(b) of the Constitution which reads thus:
"[(2) Notwithstanding anything contained in clause (2) of Article 48, the President may also dissolve the National Assembly in his discretion where, in his opinion,-
(b)??????? a situation has arisen in which the Government of the Federation cannot be carried on in accordance with the provisions of the Constitution and an appeal to the electorate ifs necessary.]"
Mr Khalid Anwar next submitted that perusal of the two speeches of the Chief Executive delivered on 13th and 17th October, 1999, shows that he claimed no power to amend the Constitution. but m the subsequent proclamations he does. The learned counsel argued, that the Proclamation of Emergency does not explain the source of its authority and that since the PCO is based on the Proclamation, therefore, if the Proclamation is found to be ultra vires the Constitution then the super-structure thereon i.e. the PCO would also stand demolished. He further contended that the Proclamation does not confer any power on the Chief Executive in that it merely states that the country has been brought under the control of the Armed Forces. He next argued that the PCO is, at best, a quasi Constitutional order and that it cannot be accepted as a constitutional dispensation of either temporary or permanent nature. He submitted that the PCO is a Constitutional conundrum/riddle , as, on the one hand, it purports to suspend the Constitution and, on the other, says that the country will be governed in accordance with the provisions of the Constitution as nearly as possible. He contended that the maker of the document does not reject the Constitution nor does he claim any such right but merely claims the right to fine tune the document and that what emerges from this is that he leaves the Fundamental Rights intact except those suspended by the earlier Proclamation of Emergency dated 28-5-1999 i.e. Articles 15 to 19 and 24 of the Constitution. He contended that, thus, what remains intact is the Objectives Resolution, which is now substantive part of the Constitution under Article 2A thereof.
He argued that the Objectives Resolution recognises the `Islamic doctrine of sovereignty' as expounded in the Holy Book, that sovereignty belongs neither to ruler nor the ruled but Almighty Allah alone and the consequential doctrine is that authority is to be exercised by the people of Pakistan through their chosen representatives, and that such authority shall be exercised within the limits prescribed by Almighty Allah, which is a sacred trust. He contended that this is a complete doctrine of Islamic sovereignty and that this is the law of God and the law of nature. He further submitted that these being the contours of Islamic doctrine of sovereignty, there is need of a physician/surgeon to prescribe the medicine/surgery after diagnosing the disease/ailment in the body politic of the nation. He submitted that the remedy is certainly not to kill the chosen representatives but to bring them on the path of rectitude. He next argued that the Chief Executive by accepting the Objectives Resolution accepts the Islamic doctrine of sovereignty which is a right of the people to govern themselves through the chosen representatives, to have a democratic State, an independent Judiciary as well as preservation of democracy and protection of political unity. The learned counsel also referred to Articles 4 and 5 of the Constitution which are left intact by the PCO. He argued that it is a fundamental principle of jurisprudence that Courts must always endeavour to extend their jurisdiction and not restrict it. Mr Khalid Anwar argued that proviso to Article 2 clause (2) of the PCO does not confer absolute immunity on Chief Executive of the nature of Articles 248(1), 269 and 270-A of the Constitution. He, submitted that the immunity conferred by these Articles has been restricted in cases of Ghulam Mustafa Khar (supra) and Sardar Farooq Ahmed Khan Leghari (supra).
Mr Khalid Anwar next contended that as the legislator is deemed to know the previous law before he amends it, the drafters of the PCO are deemed to have known that notwithstanding the clauses inserted. therein the Court has jurisdiction to examine the vires of any action and that by missing out this important point the drafters have accepted it tacitly/impliedly that the orders of the Chief Executive are subject to the jurisdiction of the Constitutional Courts of the land. He further submitted that by including paragraphs 2(b) and 7 in the PCO, its author has recognized that Courts and Judges are not merely entitled to but are in fact continuing in office, which fact also implies that both the documents i.e. the Proclamation of Emergency and the PCO have accepted the necessity of Judges to continue, they being the guardian of the Constitution.
He next argued that the Order 1 of 2000, dated 25th January, 2000 allows all the Courts to continue to function and exercise powers, which is a reiteration of what was earlier stated by the Oath of Office (Judges) Order, 1999 (Order 10 of 1999), paragraph 3 whereof states that Order I of 2000 shall apply to: (1) newly appointed Judges; (2) that Oath shall be made before the Constitutional authority; and (3) that it would be in accordance with the appropriate form set out in the Third Schedule to the Constitution. He submitted that the doctrine of necessity required the newly appointed Judges to take oath before the constitutionally designated authority and as per the procedure prescribed by the Constitution and not by the Order 1 of 2000. He pin-pointed the defects/deficiencies in the Order 1 of 2000 viz. assuming the power to amend the Constitution stipulated in the preamble of the said Order and without prescribing any amendment of the Proclamation or the PCO in pursuance of which it is promulgated. He submitted that amendment in the Constitution is not justified for three reasons: (1) that it is being done by means of subordinate instrument as the preamble of the Order 1 of 2000 recognises the supremacy of the Proclamation and the PCO; (2) that the contents of the preamble are simply a statement of intent and (3) that it claims to do so retrospectively, which a preamble cannot do. He further argued that paragraph 3 of the above Order is ultra vires Article 209 of the Constitution. Mr. Khalid Anwar, however, added that a Judge acting according to his conscience and in all good faith may decide to resign or he may decide that in the higher public interest he should retain his office. In this connection, the learned counsel referred to the book titled "Constitutional Legitimacy" `A Study of the Doctrine of Necessity' authored by Leslie Wolf-Phillips, wherein the following passage occurs: -
"A former member of
"the Argentine Supreme Court has justified the role of the Court as the beneficial expression of a laudable political realism'. He saw choices before the Court in a revolutionary situation as irresponsible resignation, acceptance of the situation, an attempt to save whatinstitutional values' remained to be saved:
It has exercised a function of institutional salvation by guarding human rights and the independence of the judiciary. It has been as if they said to the military men??we recognise the practical power that you exercise, because otherwise there would be chaos instead of order and authority in the country..."
55.?????? He next submitted that Order 1 of 2000, is contrary to the PCO, which is a sub-constitutional Order and re-affirms the right of the Judges to continue in office. He argued that the Proclamation states that the whole of Pakistan will come under the control of Armed Forces, which does not and cannot amount to a charter or open legal licence to suspend the Constitution but is only intended to ask the Armed Forces of Pakistan to discharge their constitutional obligation to restore ordinary governance in accordance with the mandate of the Constitution. He contended that this submission. is in line with Asma Jilani's case having the same legal and conceptual reiteration, which Hamoodur Rehman, C J (as he then was), had made. He submitted that emergency is to re-affirm the restoration/establishment of Constitutional rule and not to abrogate or reject it and this follows from the Proclamation itself if interpreted in the light of Asma Jilani's case.
He argued that there being a conflict between the PCO and Order 1 of 2000, it is the Order which must yield to the superior mandate of the PCO. Mr. Khalid Anwar also referred to some observations from the case of Miss Asma Jilani (supra) from pages 183, 193, 194, 195, 196, 197 and 198 which were also referred to by Ch.Muhammad Farooq, learned ASC.
Mr Khalid Anwar further argued that if necessity was to remove the Prime Minister then that necessity was fulfilled on 12th October, 1999. He submitted that this Court is the ultimate guardian of the Constitution and various rights of the people of Pakistan. He submitted that this Court is the only institution, which is respected by the people because it is an embodiment of the ideals of justice and guardian of Rule of Law. He contended that the Proclamation and the PCO are to be authoritatively and definitively interpreted in the present case and that there are three possible interpretations:
"(1) that under the PCO the Chief Executive may amend the Constitution, make new laws. postpone elections indefinitely and take whatever action he deems fit and appropriate --- which is a Duke of Willington theory of Martial Law that it is the will of the Army Commander- If Court would accept this interpretation, his petition will be dismissed.
(2)??????? The petitioner's interpretation is contained in the prayer at pages 67-69 of the petition, which if accepted in terms thereof, the previous Government is restored, (3)??????? The Court examines the situation with a view to giving finding of what may be termed as a law constituting fact, which relates to the nature of the legal system while giving this finding the Court will not proceed on the basis of political speeches and statements of intent and render a verdict about sincerity of either of the present rulers or the former rulers, instead the Court will proceed on the objective realities."
The National Armed Forces form a non-political, obedient and non-deliberative institution, organised by the State to ensure the national defence the stability of democratic institutions and respect for the
Constitution and the laws??.;and Article 1 250 follows Article 136 of the
Mexican Constitution in its declaration thatThis Constitution shall not lose its effect even if its observance is interrupted by force or if it is repealed by means other than those provided therein. In such eventuality, every citizen, whether or not vested with authority, has the duty to collaborate in the reestablishment of its effective validity.' In the case of Brazil, section 6, Article 91 of the 1967 Brazil Constitution declares that "It is the mission of the armed forces, which are essential to the execution of the national security policy, to defend the country and to guarantee the constituted powers, and law and order." In Chile, Dr: Salvador Allende
Gossens was elected to the Presidency in 1970 and his Government was overthrown in a coup planned and executed by the Armed Forces. The Commander-in-Chief appointed by Allende was proclaimed President on 11th September, 1973.
Constitutional Act No.2 of September 1976 states the role of the Armed Forces as follows: -"In observance of their essential duty to safeguard the sovereignty of the Nation and the permanent superior values of the Chilean people... the armed forces undertook the leadership of the Republic .... .
The 1886 Cronstitution of Colombia also gives no lead to the military in political intervention. Article 168 provides that the military may not ?deliberate' and may not `assemble except by order of the legitimate authority He argued that whatever limits are on exercise of power, the contents of the PCO be spelt out lucidly leaving nothing to chance: His precise submission was that the status of present Government is that of a de facto government and not of a de jute government.
"The considerations above stated lead us to the conclusion, that in republics there are, in reality, stronger reasons for an independent tenure of office by the Judges, a tenure during good behaviour, than in a monarchy. Indeed, a republic with a limited Constitution, and yet without a judiciary sufficiently independent to check usurpation, to protect public liberty, and to enforce private rights, would be as visionary and absurd, as a society organized without any restraints of law. -It would become a democracy with unlimited powers, exercising through its rulers a universal despotic sovereignty. The very theory of a balanced republic of restricted powers presupposes some organized means to control, and resist, any excesses of authority. The people may, if they please, submit all power to their rulers for the time being; but, then, the Government should receive its true appellation and character. It would be a Government of tyrants, elective, it is true but still tyrant; and it would become the more fierce, vindictive, and sanguinary, because it would perpetually generate factions in its own bosom, which could succeed only by the ruin of their enemies. It would be alternately characterized, as a reign of terror, and a reign of imbecility. It would be as corrupt, as it would be dangerous. It would form. another model of that profligate and bloody democracy, which, at one time, in the French revolution, darkened by its deeds the fortunes of France, and left to mankind the appalling lesson, that virtue and religion, genius and learning, the authority of wisdom and the appeals of innocence, are unheard and unfelt in the frenzy of popular excitement; and, that the worst crimes may be sanctioned, and the most desolating principles inculcated, under the banners, and in the name of liberty. In human governments, there are but two controlling powers; the powers of arms and the power of law. If the latter are not enforced by a judiciary above all fear, and above all reproach, the former must prevail; and thus, lead to the triumph of military over civil institutions. The framers of the Constitution, with profound wisdom, laid the corner stone of our national republic in the permanent independence of the judicial establishment. "
Mr. Khalid Anwar referred to the following passages at pages 16?21, 146-151, 168-169, from the book titled CONSTITIJTIONS IN CRISIS, Political Violence and the Rule of Law by John E. Finn :-
"Carl J. Friedrich and Carl Schmitt similarly began their well-?known studies of Constitutional emergency powers with a review of the Roman dictatorship, and others have found in that institution `a theoretical standard ...a sort of moral yardstick against which to measure modern institutions of Constitutional dictatorship.'
There were four conditions to the Roman dictatorship, all of which, Friedrich argued, are of contemporary utility:
1.???????? The appointment of the `dictator' must take place according to precise constitutional forms.
2.???????? The dictator must not have the power to declare or to terminate the state of emergency.
3.???????? Dictatorial, discretionary powers must obtain for only a (relatively) precise time, and the limit must not be subject to indefinite extension.
4.???????? The ultimate objective of Constitutional emergency powers must be the defense and restoration of the Constitutional order."
Constitutional Dictatorship and the Prerogative
"More recently, Arthur
Schlesinger, Jr., devoted much of The Imperial Presidency to the problems of emergency government. Schlesinger conceded, as have all who preceded and followed him, that there will be times when the President must act in extraordinary fashion to ensure national survival. Crises threatening the life of the nation,' he wrote,have happily been rare. But, if such a crisis comes, a President must act.' The question is whether the Constitution authorizes these extraordinary actions.
"Schlesinge, concluded that emergency government should be recognized for what it is: an extra-constitutional resort to raw political power, necessary but not lawful.' The alternative view, that the Constitution contemplates (if it does not authorize) extraordinary power, renders the document so meaning-less that it fails to possess real authority even in normal conditions, a conclusion Corwin had reached earlier in his pointed analysis of the -effects of World War II find the New Deal upon American Constitutional law.
"The similarities between Schlesinger's argument and the Lockean defense of executive prerogative are, of course; substantial. In the Second Treatise of Government, Locke argued, as did Jefferson later, that `a strict and rigid observation of the laws [in some cases] may do harm.' The executive must have a Power-the prerogative-to act 'according to discretion, for the public good, without the prescription of law, and sometimes even against it.'
"The prerogative of the Crown, or some institution like it, suggested for Schlesinger that the American presidency `must be conceded reserve powers to meet authentic emergencies.' Without clearly specifying the source of their authority, Schlesinger argued that the invocation and use of emergency powers must be subject to a number of restraints, most of which are directed toward establishing the authenticity of the emergency:
" 1.?????? there must be a clear, present and incontestable danger to the life of the nation;
2.???????? the President must define and explain to Congress and the people the nature of this threat;
3.???????? the perception of the emergency, the judgment that the life of the nation is truly at stake, must be broadly shared by Congress and by the people;
4.???????? time must be of the essence; waiting for normal legislative action must constitute an unacceptable risk;
5.???????? existing statutory authorizations must be inadequate, and Congress must be unwilling or unable to prescribe a national course;
6.???????? the problem must be one that can be met in no other way than by presidential action beyond the laws and the Constitution;
7.???????? the President must report what he has done to Congress, which will serve as the Judge of his action;
8.???????? none of the presidential acts can be directed against the political process itself.
"In so far as Schlesinger conceded that at times ,the Constitution must be suspended, these restraints cannot strictly trace their authority to the constitutional document. Schlesinger failed to provide any source at all for their origination; presumably they find authority in political necessity and their fidelity to the Roman principle that all exercises of emergency power must be directed to defense and restoration of the constitutional order. But we might well-wonder why these extratextual principles should bind in the absence of an obligation to respect limitations set forth in the constitutional document itself. As Madison counseled, `The restrictions, however, strongly marked on paper will never be regarded when opposed to decided sense of the public, and after repeated violations in extraordinary cases they will lose even their ordinary efficacy.' It is difficult to see why a crisis severe enough to overwhelm the constitutional document would not also overwhelm extratextual restraints.
"There is yet another difficulty with Schlesinger's argument. The second principle-which requires that the President must define and explain to Congress and the people the nature of the crisis-implies the continued constitutional status of both
Congress and the President. But once we suspend the Constitution, the status of the offices and institutions it creates are themselves problematic. An official who claims the Lockean prerogative, the power to suspend the Constitution;
risks the absurdity of saying:An officer who shall be recognized by criteria set forth in this Constitution shall have the power to act contrary to this
Constitution." Officers in the strict sense cannot have such a power because we need rules they cannot lawfully change if we are t o recognize those persons who lawfully claim the authority to act as officials.' Arguably, then, an individual who claims the Lockean prerogative is not thePresident' but rather is an individual strategically situated' to exercise emergency power. Consequently, the constitutional status of an officer who claims the
Lockean prerogative is troublesome, as is the status of theCongress' to which he must report his actions. Moreover, as some critics have observed, the crucial issue must be the severity of the danger, not how `Congress' Judges its severity. Surely a President should not fail to act simply because Congress does not share his or her sense of alarm.
"This formulation of the problem denies the possibility that the Constitution's military powers are sufficient to cope with all emergencies. Instead, Bessette and Tulis defend a liberal method of interpretation that compensates for the shortcomings of these powers. Their argument indicates that one possible way to make sense of the claim to perpetuity is to treat it as a claim about how to interpret constitutional language: When faced with a crisis, constitutional maintenance demands that we interpret the document in such a way as authorize whatever powers and measures are necessary to cope with f emergency. The argument complements . Hamilton', who argued in Federalist 23 that a properly framed constitution accounts for the inevitability of crisis, so that there can be `no limitation of that authority which is to provide for the defense and protection of the community in a mater essential ,to its efficacy.' Hamilton merely restated the position, Machiavelli adopted in his discussion of the Roman Republic in the Discourses:
"Now in a well-ordered republic it should never be necessary to resort to extra constitutional measures; for although they may for the time be beneficial, yet the precedent is pernicious, for if the practice is once established of disregarding the laws for good objects, they will in a little while be disregarded under that pretext for evil purposes. Thus, no republic will ever be perfect if she has not by law provided for everything having a remedy for every emergency, and fixed rules for applying it."
"No doctrine, involving more pernicious consequences, was ever invented by the wit of man that any of [the Constitution's] provisions can be suspended during any of the great exigencies of Government. Such a doctrine leads directly to anarchy or despotism, but the theory of necessity on which it is based is false; for the Government, within the Constitution, has all the powers granted to it which are necessary to preserve its existence."
"There are subtle and important differences between this position and the one advanced by Bessette and Tulis (Hamilton's requires framers with extraordinary prescience, whereas Bessette and Tulis defend a method of interpretation that makes up for their lack of it;. but both have the signal benefit of not impairing the constitutional status of the other branches of the Federal Government. Other institutions, thus, have some constitutional basis for questioning a President's exercise of emergency power, a legitimacy they cannot claim one the Constitution is set aside. "The decisive fact is that under the United States Constitution the functioning of the coordinate institutions of American Government is not suspended nor is their authority dissolved??..when the President undertakes extraordinary actions."
"It gives to the President a strong weapon which we cannot renounce under any circumstances." Press later wrote: "If ever in history, dictatorial powers were indispensable to a public authority, they were so for the national government of the young German Republic."
"As it appeared in final form, Article 48 in full provided:
"If a State does not fulfil the duties incumbent upon it according to the national Constitution or laws, the President of the Reich may compel it to do so with the aid of the armed forces."
"If the public safety and order in the German Reich are seriously disturbed or endangered, the President ...may take the measures necessary to the restoration of public safety and order, and may if necessary, intervene with the assistance of the armed forces. To this end, he may temporarily suspend in whole or in part, the Fundamental Rights established in Articles 114, 115, ,117, 118, 123, 124 and 153."
"The President ...must immediately inform the Reichstag of all measures taken in conformity with sections one or two of this Article. The measures are to be revoked upon the demand of the Reichstag. In cases where delay would be dangerous, the State Government may take for its territory temporary measures of the nature described in section two."
"The measures are to be revoked upon the demand of the President or the Reichstag.".
"A national law shall prescribe the details. The national law promised in the last sentence was never enacted. But even without supplemental legislation, it was clear that emergency powers were ultimately subject to civilian, and in particular legislative, control. Article 48 nevertheless also reinforced the President's constitutional position because his authority derived directly and independently from the text and not from the delegated authority of the legislature, as was later the case with executive ordinances issued under Weimar's many enabling acts. In this respect Article 48, like so much of the Weimar Constitution, reflected an uneasy compromise between parliamentary and Presidential Government."
"Hitler also used Article 48 to intimidate his opposition in the March elections, in which the National Socialists, coupled with the Nationalists, finally secured an absolute majority in the Reichstag. Again in accordance with constitutional precedent, Hitler then sought an enabling act in which the Reichstag would effectively yield its legislative competence to the executive. The Reichstag, over the objection of the Social Democrats, granted the authority (in the Law for the Relief of the People and the Reich) for a period of four years, but conditioned it with limitations designed to protect itself and the institutional structure of the republic. Paragraph two sentence one provided; "The statutes decreed by the government may deviate from the Constitution with the reservation that they should not affect the institutions of the Reichstag and of the Federal Council" These qualifications did not, however, prevent Hitler from abolishing life tenure for civil servants or from compromising the independence of the judiciary. Nor did the act contain protections for individual liberties. "
"No. 78: Hamilton"
"We proceed now to an examination of the judiciary department of the proposed government. "
"In unfolding the defects of the existing Confederation the utility and necessity of a federal judicature have been clearly pointed out. It is the less necessary to recapitulate the considerations there urged as the propriety of the institution in the abstract is not disputed; the only questions which have been raised being relative to the manner of constituting it, and to its extent. To these points, therefore, our observations shall be confined. "
"The manner of constituting it seems to embrace these several objects; 1st. The mode of appointing the Judges, 2nd. the tenure by which they are to hold their places, 3rd. The partition of the judicial authority between different Courts and their relations to each other."
"Second. As to the tenure by which the Judges are to hold their places: this chiefly concerns their duration in office, the provisions ' for their support, the precautions for their responsibility.
"According to the plan of the convention, all Judges who 'nay be appointed by the United States are to hold their offices during good behavior; which is conformable to the most approved of the State Constitutions, and among the rest, to that of this State. Its propriety having been drawn into question by the adversaries of that plan is no light-symptom of the rage for objection which disorders their imaginations and judgments. The standard of good behavior for the continuance in office of the judicial magistracy is certainly one of the most valuable of the modern improvements in the practice of Government. In a monarchy it is an excellent barrier to the despotism of the prince; in a republic it is a no less excellent barrier to the encroachments and oppressions of the representative body. And it is the best expedient which can be devised in any Government to secure a steady, upright, and impartial administration of the laws."
"Whoever attentively considers the different departments of power must perceive that, in a government in which they are separated from each other, the judiciary, from the nature of its functions, will always be the least dangerous to the political rights of the Constitution; because it will be least in a capacity to annoy or injure them. The executive not only dispenses the honors but holds the sword of the community. The legislature not only commands the purse but prescribes the rules .by which the duties and rights of every citizen are to be regulated. The judiciary, on the contrary, has no influence over either the sword or the purse; no direction either of the strength or of the wealth of the society, and can take no active resolution whatever. It may truly be said to have neither FORCE nor WILL but merely judgment; and must ultimately depend upon the aid of the executive arm even for the efficacy of its judgments..
"This simple view of the matter suggests several important consequences. It proves incontestably that the judiciary is beyond comparison the weakest of the three departments of power; that it can never attack with success either of the other two; and that all possible care is requisite to enable it to defend itself against their attacks. It equally proves that though individual oppression may now and then proceed from the Courts of justice, the general liberty of the people can never by endangered from that quarter; I mean so long as the judiciary remains truly distinct from both the legislature and the executive. For I agree that "there is no liberty if the power of judging be not separated from the legislative and executive powers." And it proves, in the last place, that as liberty can have nothing to fear from the judiciary alone but would have everything, to fear from its union with either of the other departments; that as all the effects of such a union must ensue from a dependence of the former on the latter, notwithstanding a nominal and apparent separation; that as, from the natural feebleness of the judiciary, it is in continual jeopardy of being over powered, awed, or influenced by its co-ordinate branches; and that as nothing-can contribute so much to its firmness and independence as permanency in office, this quality may, therefore, be justly regarded as an indispensable ingredient in its constitution, and, in a great measure, as the citadel of the public justice and the public security.
"The complete independence of the Courts of justice is peculiarly essential in a limited Constitution. By a limited Constitution, I understand one which contains certain specified exceptions to 'the legislative authority; such, for instance, as that it shall pass no bills of attainder, no ex post facto laws, and the like. Limitations of this kind can be preserved in practice no other way than through the medium of Courts of justice, whose duty must be to declare all acts contrary to the manifesto tenor of the Constitution void. Without this, all the reservations of particular rights or privileges would amount to nothing." , "This independence of the Judges is equally requisite to guard the Constitution and the rights of individuals from 'the effects of those ill-humors which the arts of designing men, or the influence of particular conjunctures, sometimes disseminate among the people themselves, and which, though they speedily give place to better information, and more deliberate reflection, have tendency, in the meantime, to occasion dangerous innovations in the government, and serious oppressions of the minor party in the community. Though I trust the friends of the proposed Constitution will never concur with its enemies. in questioning that fundamental principle of republican government which admits the right of the people to alter or abolish the established Constitution whenever they find it ,inconsistent with their happiness; yet it is not to be inferred from this principle that the representatives' of the people; whenever a momentary inclination happens to lay hold of a majority of their constituents incompatible with the provisions in the existing Constitution would, on that account, be justifiable in a violation of those provisions; or that the Courts would be under a greater obligation to connive at infractions in this shape than when they had proceeded wholly from the cabals of the representative body. Until the people have, by some solemn and authoritative act, annulled or changed the established form, it is binding upon themselves collectively, as well as individually; and no presumption, or even knowledge of their sentiments, can warrant their representatives in a departure from it prior to such an act. But it is easy to see that it would require an uncommon portion of fortitude in the judges to do their duty as faithful guardians of the Constitution, where legislative invasions of it had been instigated by the major voice of the community. "
"First. To all cases in law and equity, arising under the Constitution and the laws of the United States. This corresponds to the two first classes of causes which have been enumerated, as proper for the jurisdiction of the United States.
No. 81 : Hamilton
"The judicial power of the United States is" (by the plan of the convention) "to be vested in one Supreme Court, and in such inferior Courts as the Congress may, from time to time, ordain and establish."
"7. Our conclusions and directions in nutshell are as under:-
(i) The words "after consultation" employed inter alia in Articles 177 and 193 of the Constitution connote that the consultation should be effective, meaningful, purposive, consensus oriented, leaving no room for complaint of arbitrariness or unfair play. The opinion of the Chief Justice of Pakistan and the Chief Justice of a High Court as to the fitness and suitability of a candidate for judgeship is entitled to be accepted in the absence of very sound reasons to be recorded by the President/Executive.
(ii)??????? That if the President/Executive appoints a candidate fund to be unfit and unsuitable for judgeship by the Chief Justice of Pakistan and the Chief Justice of the High Court concerned, it will not be a proper exercise of power under the relevant Article of the Constitution.
(viii) That an appointment of a sitting Chief Justice of a High Court or a Judge thereof in the Federal Shariat Court under Article 203-C of the Constitution without his consent is violative .of Article 209, which guarantees the tenure of office. Since the former Article was incorporated by the Chief Martial Law Administrator and the latter Article was enacted by the Framers of the Constitution, the same shall prevail and, hence, such an appointment will be void."
"(xiii) That since consultation for the appointment/confirmation of a Judge of a Superior Court by the President/Executive with consultees mentioned in the relevant Articles of the Constitution is mandatory, any appointment/confirmation made without consulting any of the consultees as interpreted above would be violative of the Constitution and, therefore, would be invalid."
"82 ????? We are interpreting the word consultation' to widen and enlarge its normal scope for the reasons, firstly, that the Constitution-makers have not debated this word 'consultation' and fixed its parameters. Secondly, we would like to assign meaning toconsultation', which is consistent and commensurate with the exalted position of Judiciary as is envisaged in Islam.
Thirdly, we would like to give positive interpretation to 'consultation' which promotes independence of Judiciary."
"88. Under Article 197 of the Constitution there is a provision for appointment of Additional Judges and' it appears that there is no requirement that they can be appointed only after the sanctioned strength of the Judges of the High Court is filled in with the permanent appointees. From this it appears that even against the vacancies within the sanctioned strength a person can be appointed as Additional Judge of the High Court for a period to be specified and then can be made permanent as communicated under Article 193. We are of the view that such Judges have legitimate expectancy to be entitled and considered for appointment upon expiry of their period of appointment as Additional Judges if and when they are so recommended for the purpose by the Chief Justice of the High Court and the Chief Justice of Pakistan. If such appointments are refused to be made then there should be strong reasons recorded in writing. Extension to be made or not is not the sole discretion of the Federal Government unless such request is made by the Chief Justice of the High Court and the CJP."
"93. Article 209 of the Constitution relates to the composition of the Supreme Judicial council and its functions. It enables the Council to take action or remove a Judge from the office on the ground of his incapability to perform the duties of his office for the reason of physical or mental incapability or misconduct. Sub-Article (7) of this Article provides that a Judge of the Supreme Court or of a High Court shall not be removed from the office except as provided by this Article. Sub-Article (8) of this Article provides that the Council shall issue the Code of Conduct to be observed by the Judges of the Supreme Court and High Courts. It is clear from the above provisions that the security of tenure is provided under Article 209 and also the forum for removal from the office as Judge of the High Court or of the Supreme Court. This provision is incorporated in the Constitution by the Constitution-makers. Subsequently, Chapter III-A setting up the Federal Shariat Court was inserted in the Constitution vide P.O. No.l of 1980 providing in Article 203-C(4) that a Judge or Chief Justice of the High Court can be appointed to the Federal Shariat Court without his consent for a period not exceeding two years. After such appointment it is open to the President to modify the terms of the appointment of such Judge in the Federal Shariat Court or assign him any other office or require him to perform such other functions as the President may deem fit. If a Judge or Chief Justice of a High Court refuses to accept the appointment to the Federal Shariat Court, then he stands retired. No doubt, Chapter III-A inserted in the Constitution for the purpose of setting up of the Federal Shariat Court envisages that the provisions of this chapter shall; have effect notwithstanding anything contained in the Constitution, still the appointment of a Judge or a Chief Justice of a High Court to the Federal Shariat Court in such manner without his consent accompanying by such harsh conditions in the final analysis is tantamount to removal or forcible retirement which can and should be done only under Article 209 of the Constitution under which the Supreme Judicial Council is constituted and is authorised to take action of such punitive nature. If the Government finds a particular Judge or the Chief Justice of a High Court to be uncooperative and if there is sufficient material to support the charge of misconduct, then in all fairness action should be taken against him and proceedings should be initiated before the Supreme Judicial Council in the manner prescribed under Article 209. We are not striking down provisions (4), (4-B) and (5) of Article 203-C as void being inconsistent with Article 209 but we do say that, keeping in view the rules of interpretation, if there is choice between two forums or provisions, then the provision beneficial to the affected Judge should have been adopted or restored to, and in such circumstances, the resultant action is to be considered as void in absence of cogent reasons without going into the constitutionality of Article 203-C of the Constitution. The Constitution is to be read as a whole and if there is any inconsistency, the same can be removed or rectified by the Parliament. In support of the proposition, reliance can be placed on the cases of Fazlul Quader Chowdhry v. Muhammad Abdul Haque PLD 1963 SC 486 and Hakim Khan v. Government of Pakistan PLD 1992 SC 595.
At page 424, paragraph 21 of the above report it was observed:-
"21. (a) As regards the Islamic concept of justice, it may be pertinent to point out that in the early days of civilisation, the legislative, the executive and the judicial powers were vested in one person in a State, namely, in a Chieftain or a monarch or a ruler. The concept that there are three organs of the State which share the power of a State, namely, the Executive, the Legislature and the Judiciary, is somewhat a modern concept. Upon the advent of Islam, the Judicial functions were separated from the executive functions at its very initial stage by the Holy Prophet (p.b.u.h.) by appointing a Qadi for each Province. The separation of judiciary from executive was implemented more effectively during the Caliphate of Second Caliph Hazrat Umar as he appointed Qadis free of control of the Governors. The reason being that the foundation of Islam is on justice. The concept of justice in Islam is different from the concept of the remedial justice of the Greeks, the natural justice of the Romans or the formal justice of the Anglo-Saxons. Justice in Islam seeks to attain a higher standard of what may be called "absolute justice" or "absolute fairness". We find repeated references to the importance of justice and of its being administered impartially in Holy Qur'an and some of them are as follows:--
In one of the Verses of the Holy Qur'an Allah commands that---
Sura Aale-e-Imran
"O ye .who believe: Stand out firmly for justice, as witnesses to Allah, even as against yourselves, or your parents, or your kin, and whether it be against rich or poor, for Allah can best protect both. Follow not the lusts of your hearts; lest ye swerve, and if ye distort justice or decline to do justice, verily Allah is well-acquainted with all that ye do. "(4-135)
And in other Surah Allah commands as under---
Surah Maida, 5/9
"O ye who believe stand out firmly for Allah, as witnesses to fair dealing, and let not the hatred of others to you make you swerve to wrong and depart from justice. Be just, that is next to Piety: and fear Allah, for Allah is well-acquainted with all that ye do."
"Since there is a conflict between the above two. Articles, efforts are to be made to resolve the same by reconciling it. The Constitution is to be read as a whole as an organic document. A close scrutiny of the various provisions of the Constitution highlights that it envisages that the independence of judiciary should be secured as provided by the founder fathers of the country by passing Objectives Resolution and by providing security of tenure. The Constitution also envisages separation of judiciary from the executive. Keeping in view the various provisions of the Constitution, it is not possible to reconcile the above provisions of Article 203-C and Article 209. In such a situation, the question arises, which of the Article should prevail. One view can be that since Article 203-C was incorporated subsequent to Article 209 was incorporated by consensus by the framers of the Constitution and whereas Article 203-0 was incorporated by the then Chief Martial Law Administrator and as the same is detrimental to the basic concept of independence of judiciary and the separation of judiciary, the former should prevail. I am inclined to prefer the latter interpretation as it will be more in consonance with the various provisions of the Constitution and in accord with justice and fairplay. A person cannot be appointed on adverse terms in a new Court without his consent." '
Reliance was also placed on the following observations made in the case of Mahmood Khan Achakzai (supra)
"For reasons to be recorded later, we pass following short order:
"What is the basic structure of the Constitution is a question of academic nature which cannot be answered authoritatively with a touch of finality but it can be said that the prominent characteristics of the Constitution are amply reflected in the Objectives Resolution which is now substantive part of the Constitution as Article 2A inserted by the Eighth Amendment.
"The Objectives Resolution was Preamble of the Constitutions made and promulgated in our country in 1956, 1962 and 1973. Perusal of the Objectives Resolution shows that for scheme of governance the main features envisaged are Federalism and Parliamentary Form of Government blended with Islamic provisions. The Eighth Amendment was inserted in the Constitution in 1985, after which three elections were held on party-basis and the resultant Parliaments did not touch this Amendment, which demonstrates amply that this Amendment is ratified by implication and has come to stay in the Constitution unless amended in the manner prescribed in the Constitution as contemplated under Article 239 and Article 58(2)(b) brought in the Constitution by the Eighth Amendment, which maintains Parliamentary Form of Government has provided checks and balances between the powers of the President and the Prime Minister to let the system work without let or hindrance to forestall a situation in which martial law could be imposed. "
"24. In the Pakistan Resolution passed on 23-3-1940 at Lahore it was resolved that. regions with Muslim majority, should be grouped together to constitute "Independent States" in which constituted units shall be autonomous and sovereign and rights of minorities to be protected. After partition Constituent Assembly of Pakistan passed Objectives Resolution, which was inserted in 1956 Constitution as Preamble. Objectives Resolution retained as Preamble in the Constitution of 1973 also can be read in order to gather the intention of the Constitution makers as to what type of governance and working set up was intended. It is noteworthy that to the Objectives Resolution it is mentioned that sovereignty over the entire universe belongs to Almighty Allah and the State shall exercise its power through the chosen representatives of the people. It is also mentioned in the Objectives Resolution that principles of democracy, freedom, equality, tolerance and social justice as enunciated by Islam shall be enabled to order their lives in accordance with teachings and requirements of Islam as set out in the Holy Qur'an and Sunnah and independence of judiciary shall be fully secured. Objectives Resolution was even retained in the Interim Constitution of 1972 as Preamble. This Court examined Preamble of Interim Constitution of 1972 in the case of Miss Asma Jillani v. Government of Punjab and another PLD 1972 SC 139 with relevant portion at page 141 with leading judgment by learned C.J. Hamoodur Rehman, who held as under:--
"In any event, if a grund norm is necessary, Pakistan need not have to look to the Western legal theorists to discover it. Pakistan's own grund norm is enshrined in its own doctrine that the legal sovereignty over the entire universe belongs to Almighty Allah alone, and the authority exercisable by the people within the limits prescribed by Him is a sacred trust. This is an immutable and unalterable norm which was clearly accepted in the Objectives Resolution passed by the Constituent Assembly of Pakistan on the 7th of March, 1949. This has not been abrogated by any one so far, nor has this been departed or deviated from by any regime, military or civil. Indeed, it cannot be, for, it is one of the fundamental principles enshrined in the Holy Qur'an."
"25. This question with regard to grund norm was examined again in the case of. State v. Ziaur Rehman PLD 1973 SC 49 and the same learned C.J. has clarified the position and the relevant portion of page 54 of the report is reproduced as under:--
"In Asma Jillani's case PLD 1972 SC 139 it has not been laid down that the Objectives Resolution is the grund norm of Pakistan but that the grund norm is the doctrine of legal sovereignty accepted by the people of Pakistan and consequences that flow from it. It does not describe the Objectives Resolution as "the cornerstone of Pakistan's legal edifice' but has merely pointed out that one of the counsel appearing in the case had described it as such. It is not correct, therefore, to say that the Objectives Resolution has been declared 'to be a transcendental part of the Constitution' or 'to be a transcendental part of the Constitution' or to be a `supra? Constitutional instrument which is unalterable and immutable".
The "grund norm' referred to by the Supreme Court was something even above the Objectives Resolution which "embodies the spirit and the fundamental norms of the Constitutional concept of Pakistan'. It was expected by the Objectives Resolution itself to be translated into the Constitution. Even those that adopted the ' Objectives Resolution did not envisage that it would be a document above the Constitution. It is incorrect, therefore, to say that it was held by the Supreme Court that the Objectives Resolution of the 7th March, 1949, stands on a higher pedestal than the Constitution itself. "
??????????????????????????????????????????????????????????????????????????
"27. We are going into the question of validity of the Constitution (Eighth Amendment) Act, 1985, later but for the time being it would suffice to say that freedom bestowed upon the Parliament in clause (6) of Article 239 after amendment does not include power to amend those provision so the Constitution by which would be altered salient features of the Constitution, namely federalism, Parliamentary Form of . Government blended with Islamic provisions. As long as these salient features reflected in the Objectives Resolution are retained and not altered in substance, amendments can be made as per procedure prescribed in Article 239 of the Constitution."
Per Sajjad Ali Shah, C.J.
"28. Having disposed of the question with regard to the basic structure of the Constitution as stated above, now I advert to the second important issue with regard to the Eighth Amendment inserted in 1985 in the Constitution of 1973. Before I go into the arguments and contentions of the learned counsel appearing on behalf of appellants and petitioners, it would be pertinent to recapitulate the history very briefly. It was done so very succinctly by Mr. Abdul Hafeez Pirzada, who supported the stance of Mr. Abdul Mujeeb Pirzada, who is appellant. in C. A. No. 397-K- of 1990. Pakistan came into existence in 1947 after .which for the first time Constitution of 1936 was promulgated contemplating parliamentary form of Government. This Constitution was abrogated in 1958 and Martial Law was imposed. President Muhammad Ayub Khan gave to the country Constitution of 1962 contemplating Presidential form of Government which was again abrogated in 1969 when Martial Law was imposed. In the aftermath of Martial Law of 1969 C.M.L.A. General Yahya Khan did away with One Unit in West Pakistan and in the result four Provinces; Punjab, Sindh, N.W.F.P., and Balochistan re-emerged. This was done in response to persistent demand from-East Pakistan to stop acting on the principle of parity between two Provinces of East and West Pakistan as it was felt in East Pakistan that population-wise they had edge over people in West Pakistan. Demand of the people of East Pakistan was also conceded and elections were held by General Yahya Khan on the basis of adult franchise and one-man-one-vote. There was also discontentment in the East Pakistan and elections were fought on the basis of Six Points of Awami League of Sheikh Mujeebur Rahman of East Pakistan demanding maximum autonomy allowing only three subjects for Centre and in other words it was a demand for a loose confederation. In the result of election Awami League of Sh. Mujeebur Rahman won with sweeping majority in East Pakistan and Pakistan People's Party was declared as having won as majority party in the West Pakistan. General Yahya Khan started negotiations between the parties for amicable settlement but was not successful and in the meantime military action was taken in East Pakistan as there was law and order situation resulting in riots and loss of life and damage to property. Finally, war broke out between Governments of India and Pakistan with India supporting morally and materially militant groups in East Pakistan. Finally, we lost East Pakistan as there was unilateral declaration of independence and a new country, Bangladesh came into existence."
Per Saleem Akhtar,J.
"42. The Constitution of India also provides for amendment of the Constitution. Before amendment of Article 368 it was identical to the original Article 239 of our Constitution. However when the Supreme Court of India struck down the amendments holding that it was in conflict with basic structure, Article 368 was amended and is identical to our amended Article 239. From a general assessment of the Constitutions 'of various countries it seems clear that in all the Written Constitutions, provision for amendment has been made. The object being to keep the Constitution alive and in line with the pace of progress, aspiration, will, needs and demands of the people. Constitution cannot be made static and stoic. It must progress, blossom and flower. A rigid Constitution having no provision for amendment is likely to suffer crack by violence or Constitutional deviation. Perhaps it is the historical experience that political philosophers and jurists favour provision for amendment in a written Constitution. Such provisions may restrict the power of amendment specifically as provided in France and Germany. But where an unrestricted power is given to the Legislature then Court will see whether an amendment to the existing Constitution has been duly proposed, adopted and assented in the manner required by the Constitution so as to become a part thereof. However, there are factors which restrict the power of the Legislature to amend the Constitution. It is the moral or political sentiment, which binds the barriers of Legislature and forms the Constitutional understandings. The pressure of public opinion is another factor which restricts and resists the unlimited power to amend the Constitution. In Pakistan although Article 239 confers unlimited power to the Legislature, yet it cannot by sheer force of morality and public opinion make laws amending the Constitution in complete violation of the provisions of Islam. Nor can it convert democratic form. in completely undemocratic one. Likewise by amendment Courts cannot be abolished which can perish only with the Constitution. It seems to be an emerging legal theory that even if the Constitution is suspended or abrogated, the judiciary continues to hold its position to impart justice and protect the rights of the people which are violated and impinged by the actions of the powers and authorities which saddle themselves by unconstitutional means. As held in Asma Jillani's case, such actors are usurps and the Courts had only condoned their action without approving it. The provisions of the Constitution cannot be suspended except as provided by the Constitution itself. The concept of abrogation of the Constitution is alien to the Constitution. The fact that whenever there occurred Constitutional deviation, it was legalised by condonation or validation granted by the Supreme Court, clearly demonstrates that such deviations and actions were void ab initio and unconstitutional. The validation or condonation was granted merely to avoid any disruption of civil and personal rights, to maintain continuity of administration and governance and to bring the polity and system of government on democratic and constitutional rails. But such situation, with reference to Article 6 of the Constitution has to be viewed with greater seriousness."
"50. The learned Advocate for the respondents and the learned amicus curiae have contended that the competency of the members of the National Assembly is protected by the doctrine of de facto. Reference has been made to Farzand Ali v. Province of West Pakistan PLD 1970 SC 98 and Sabir Shah v. Federation of Pakistan PLD 1994 SC 738. This is a well-recognized doctrine embedded in our jurisprudence. Under this doctrine bona fide acts in public interest performed by persons assuming authority which turns out to be illegal are assumed to have been performed by a de jure authority/person and binding. This doctrine is intended to avoid dislocation, instability and confusion while declaring a de-facto authority illegal. In order to create stability, regularity and to 'prevent confusion in the conduct of public business and insecurity of private rights the acts of the officers de facto are not sufficient to be questioned because of want of legal authority except by some direct proceeding instituted for the purpose by the State or someone claiming office de jure ... ... ...' (Constitutional Limitations by Cooley - 8th Edition, Vo1.2, page 1357). Besides this, Mr. Khalid Anwar has referred to Norton v. Shelby County 118 US 425 where it was observed that the doctrine of de facto is based on considerations of policy and public interest. For good order and peace of society the title of persons in apparent authority is to be respected and obeyed until their title is investigated in some regular mode prescribed by law. In Gokaraju v. State of Andhra Prashad AIR 1981 SC 1473 it has been observed that `the acts of the officers de facto performed by them within the scope of their assumed official authority in the interest of the public or third persons and not for their own benefit are generally as valid and binding as if they were the acts of officers de jure'. This doctrine can be applied if the Parliament is declared to be illegally constituted and Eighth Amendment is declared unconstitutional. It is only in such situation that to preserve continuity, prevent disorder and protect private rights, this doctrine can be pressed in service."
"51. Mr. Syed Sharifuddin Prizada has contended that the Eighth Amendment has introduced checks and balances between the power of the President and the Prime Minister. As discussed above, the Constitution of 1973 had vested supreme power to the Prime Minister and though democratic in form it was Prime Minister in character. Amendments made in Articles 48, 58, 91 and 92 have curtailed the power of the Prime Minister and have strengthened the hand of the President. In a democratic system check and balance is provided to avoid autocratic rule and to provide balance of power for a proper functioning of the Government according to the Constitution. No doubt the amendments particularly Article 58(2)(b) have tilted the balance in favour of the President, yet this Court has structured and circumscribed the discretionary power of dissolution. One reason given in favour of Article 58(2)(b) is that it prevents Constitutional deviation. This seems to be plausible because when Government of the Federation cannot be carried on in accordance with the provisions of the Constitution and an appeal to the electorate is necessary, the President may exercise his power before any person, agency or authority taking advantage of such situation strikes not at the Assembly but at the Constitution. One may comment that to save the Constitution, Assembly is dissolved. The exercise of power under Article 58(2)(b) or Constitutional deviation can be avoided not by the letters of the Constitution but by political ethics, morality and maturity. Unless a responsible Government exists which has respect for law, opportunity shall continue to be provided for Constitutional strike.
"53. It has also been pointed out that the controversy involves political question which the Courts should avoid to decide. The contention is more relevant with reference to the balance of power between the President and the Prime Minister. Such question is a political question to be decided by the Constituent Power. It, therefore, requires determination of what is a political question. A political question is one which because of its political sensitivity is not fit for adjudication by the Court or the Constitution requires it to be determined finally by any other organ of the State. This political question doctrine' is based on the respect for the Constitutional provisions relating to separation of power among the organs of the State. But where in a case the Court has jurisdiction to exercise power of judicial review, the fact that it involves political question, cannot compel the Court to refuse its determination.
Mr. Khalid Anwar then referring to the case of Wukala Mahaz Barai Tahafaza-e-Dastoor (supra), submitted that the rationale behind the said judgment .was that under the. 14th Amendment of the Constitution, certain restrictions were placed on speeches made .by the Members of National Assembly contrary to party policy and that any violation "thereof would lead to disqualification, but this Court by a majority decision held, as an aspect of judicial activism, that notwithstanding the language of the amendment, speeches made outside Parliament were not covered. The learned counsel termed it as an expansion of judicial power, in that, the amendment itself did not differentiate between speeches inside the parliament or outside it.
Mr. Khalid Anwar also referred to the short order in the case of Mehram Ali and others v. Federation of Pakistan etc. PLD 1999 SC 1445, to contend that this Court demonstrated expansion of judicial power in a wider shade. He made reference to the following observations of this Court in the case of Sardar Farooq Ahmad Khan Leghari and others v. Federation of Pakistan and others PLD 1999 SC 57:
"It has been pleaded that the petitions are also not maintainable because, the act of the President in proclaiming Emergency was in his sole power based on his own satisfaction which is not justiciable in a Court of law. It has also been averred that the Proclamation of Emergency as well as the order passed under Article 233(2) of the Constitution having been approved by the resolution of the joint sittings of the Parliament, now, expressed the will and satisfaction of the people of Pakistan. It has been further averred that the will of the people of Pakistan having been expressed in the resolution of the joint sittings of the Parliament, an individual or a citizen of Pakistan has no locus standi to call in question the Proclamation of Emergency and the orders suspending the Fundamental Rights.
"12. The arguments were concluded on 28-7-1998 and the aforementioned Constitution Petitions were disposed of on the same day by the following Short Order:-
"For the reasons to be recorded later on, we unanimously hold as under: -
(1) That the petitions are maintainable.
(2) That the materials placed before this Court and shown to us in the chambers, prima facie indicate that the President was justified in issuing the Proclamation under clause (1) of Article 232 of the Constitution of the Islamic Republic of Pakistan, 1973 (hereinafter referred to as the Constitution).
(3) That keeping in view the effect of the Proclamation provided for in clause (1) of Article 233 of the Constitution, which authorises the State to make any law or to take any executive action in deviation of Articles 15, 16, 17, 18, 19 and 24 of the Constitution and also keeping in view the language of Articles 10, 23 and 25 (which are hedged with- qualifications), we are of the view that an order under clause (2) of Article 233 of the Constitution for suspending the enforcement of the Fundamental Rights was not justified and, therefore, the original order dated 28-5-1998 and the order dated 13-7-1998 varying the above earlier order are declared as without lawful authority and of no legal effect.
(4)??????? That this Court has jurisdiction to review/re-examine the continuation of Emergency at any subsequent stage, if the circumstances so warrant." .
"Then it was urged by Ch. Muhammad Farooq, learned Attorney? General, that there is a significant distinction between the above two Articles inasmuch as once a Proclamation of Emergency is issued under clause (1) of Article 232 of the Constitution and an order under clause (2) of Article 233 thereof is passed for suspending the enforcement of Fundamental Rights mentioned therein, this Court cannot enforce, any Fundamental Right and, hence, it cannot entertain a petition under Article 184(3) of the Constitution, whereas there is no such suspension of the enforcement of Fundamental Rights in a case of issuance of a Proclamation under Article 234 of the Constitution. Indeed the above distinction exists. However, it may be pointed out that the suspension of the jurisdiction of this Court to enforce any one or more Fundamental Rights mentioned in an order passed by the President under clause (2) of Article 233 depends on the questions, as to whether the preconditions provided for in clause (1) of Article 232 were present at the time of the issuance of the Proclamation, and, whether the suspension of enforcement of anyone or more Fundamental Rights was warranted in terms of the constitutional framework. In other words, the exercise of power by the President under clause (1) of Article 232 is conditional and can be invoked if the conditions/prerequisites contained therein are present. If the said conditions do not exist, the exercise of power by the President under the above clause will be without jurisdiction and coram non judice. For example, if we were to hold that the expression "the security of Pakistan, or any part thereof is threatened by war or external aggression" used in clause (1) of Article 232 means actual war or actual external aggression, the exercise of power under the above clause would be without jurisdiction if factually no actual war or actual external aggression existed at the time of issuance of the Proclamation under the above provision; or if we were to hold that the reasons which prompted the issuance of Proclamation under aforesaid clause (1) of Article 232 have no nexus with the objects contained therein, such exercise of power by the President will also be without jurisdiction and coram non judice. "
" 17. It seems that by now it is a well-entrenched proposition of law that notwithstanding the ouster of jurisdiction of the Court and the fact that the formation of opinion in terms of the relevant provision of the Constitution or of a statute is to be based on the satisfaction of a State functionary mentioned therein, the Court has the jurisdiction to examine whether the pre-requisites provided for in the relevant provision of the Constitution/statute for the exercise of the power thereunder existed, when the impugned order was passed. If the answer of the above question is in the negative, the exercise of power will be without jurisdiction calling for interference by the Court.
"It may also be pointed out that the above views run counter to the Fundamental Rights guaranteed by the Constitution and the aforesaid International Covenants of Civil and Political Rights, European Convention on Human Rights and American Convention on Human Rights. In my view, a distinction is to be made between an emergency which is imposed when a country is engaged in an actual war or is subjected to actual external aggression and when the same is imposed on account of imminent danger thereof for the purpose of suspension of fundamental rights and continuation of the emergency. In the former case, the above Latin maxim inter arma silent leges (i.e. when there is an armed conflict, the law remains silent) or that the national success in the war is to be ensured in order to escape from national plunder or enslavement even if the personal liberty and other rights of the citizens are sacrificed as observed by Lord Atkinson in the case of King v. Halliday (supra) would be applicable. But in the latter case the` rule of proportionality is to be followed as propounded by some of the eminent authors and adopted under above Article 4 of the International Covenants of Civil and Political Rights, Article 15 of the European Convention of Human Rights 1967 i.e. a public emergency permits a State to take derogatory measures in derogation of the covenants subject to the condition that the rule of proportionality is observed meaning thereby, that the derogatory steps/actions should be to the extent required by the exigencies of the situation provided such measures are not inconsistent with their other obligations under the international law. The above view is reinforced by the report of International. Law Association, 1986 referred to hereinabove in para. 36 (xix), that while imposing emergency following factors should be considered :-
(i)???????? severity of cause defined generally as threatening' the life of the nation.
(ii)??????? good faith on the part of the imposing Government;
(iii)?????? proportionality (relating to geographic scope, duration, and choice of measures strictly required by the exigencies of the situation);
(iv)?????? proclamation or notification;
non-derogability of certain rights;
(vi)?????? respect for other international obligations;
(vii) non-discrimination.
"The rule of proportionality is also in consonance with the view obtaining in U.S-A. and Australia etc. namely, that a distinction has been drawn between the power of judicial review during actual war and after the cessation of hostilities already referred to hereinabove. Reference may again be made to the observation of Latham, C.J. in the case of Australia Communist Party (supra) that "tit Court in its decisions applied a rule that there must be a real- and substantial connection between the legislation and the defence situation so created in order that the legislation could be valid".
"47. In the present case the President passed first order under clause (2) of Article 233 of the Constitution on 28-5-1998 providing the right to move any Court including a High Court and the Supreme Court for the enforcement of all Fundamental Rights conferred by Chapter 1 of Part II of the Constitution and all proceedings pending in a Court which were for the enforcement or involving determination of any question as to the enforcement of any of the said rights, shall remain suspended for the period during which the said Proclamation was to remain in force."
He submitted that this Court, however, held that it has jurisdiction despite the suspension of Fundamental Rights.
Mr Khalid Anwar further argued that the alleged emergency took place on the evening of 12th October, 1999, which arose out of challenge to the removal from office of the Army Chief. He submitted that the Army Act is a complete code in relation to such matters and, therefore, if any illegality had been committed that should have been challenged under the Army Act and that with the removal of the Prime Minister from office, whether rightly or wrongly, the principle of proportionality, which is defined in this judgment as being limited to the geographic scope, duration and choice of measures strictly required by the exigencies of the situation, does not justify destruction of Constitutional governance for an indefinite period of time on a completely unrelated exigency, namely, the introduction of social or economic or financial policies. Mr. Khalid Anwar referred to the case of Al-Jehad Trust v. Federation of Pakistan 1999 SCMR 1379 to contend that the people of Northern Areas have been held to be entitled to self ?government, the right to vote, the right for enforcement of fundamental rights and, therefore, the people of Pakistan cannot be deprived of the similar rights.
Mr. Khalid Anwar next, quoting Article 14 of the Constitution which is to the effect that "the dignity of man and subject to law, the privacy of home, shall be inviolable", referred to a US case Roe v. Wade decided in 1972 whereunder the right of abortion was decided as a penumbra of right to privacy and, thus, expanded its judicial power.
Mr Khalid Anwar made a distinction between the ratio decidendi and obiter dicta, -saying that ratio decidendi contemplates the essential facts and principles upon which the case is decided and the rest is obiter dicta. He further submitted that on the basis of principle of stare decicis all these observations of the Court are obiter dicta and did not bind the Court. He submitted that assuming but not conceding that the doctrine of necessity is valid, still the finding in Begum Nusrat Bhutto's case is not applicable to the facts of the present case. .
Mr. Khalid Anwar referred to various observations from the case of Usif Patel and 2 others v. The Crown PLD 1955 FC 387 and Reference No. 1 of 1955 by His Excellency the Governor-General PLD 1955 FC 435. He also referred to the following passages from the book titled "Dissolution of Constituent Assembly of Pakistan and The Legal Battles of Moulvi Tamizuddin Khan" by Syed Sharifuddin Pirzada:
"It is submitted that the reasoning of Justice Munir is fallacious and his conclusions are erroneous. They have been aptly dealt with by Justice Cornelius in his dissenting opinion. On the question of dissolution Justice Muhammad Bukhsh in his Judgment has given cogent reasons. Reference may, therefore, be made to extracts from the aforesaid two judgments."
"The Governor-General's power of dissolution of Federal Legislature is withdrawn because the dissolution of Federal Legislature will mean the dissolution of the Constituent Assembly, which is not permissible under the provisions of Independence Act."????.The language employed in the Proclamation, however, is somewhat extraordinary. Relevant extract from it reads as follows.
"The Governor-General having considered the political crisis with which the country is faced, has with regret come to the conclusion that the constitutional machinery has broken down. He, therefore, has decided to declare a state of emergency throughout Pakistan. The Constituent Assembly as at present constituted has lost the confidence of the people and cannot longer function."
Mr. Khalid Anwar also relied on a passage from the book titled "Destruction of Pakistan's Democracy", by Allen McGrath, which reads thus :
"Instead, the Court upheld
Umar Khan's sentence, not by relying on the precedents found in Anglo-American cases dealing with civil disturbances, but instead, by citing cases arising from British suppression of the Irish and African peoples in the nineteenth century. In the cases relied on, the British judiciary had allowed the colonial military authorities powers beyond those they would have been allowed to exercise at home or in other colonies during times of peace. Convictions of civilians by military boards were upheld by the Privy Council in several cases where civilian Courts were functioning at the time of the trial and sentencing.
Munir relied oh cases which have been called forgotten episodes' which hadprovided a few fragmented rules'. An American Constitutional historian has commented on these cases, calling them harsh'. And adding,the many vigorous protests from eminent legal authorities suggest that such measures are looked upon as usurpations and wholly out of harmony with the genius and spirit of
English institutions.
"Munir was utilising cases which represented Britain the conqueror rather than Britain the law-giver. What resulted was a law of military rule in Pakistan not based on the restrained regulations for the use of the military which the British had found sufficient to control India. Instead, he relied on law which had arisen from the actions of the British Authorities taken amidst the bitter armed conflicts with conquered peoples in revolt in Ireland and South Africa, and applied that law to his own countrymen in peacetime."
He next relied on the extracts from the book titled "Transfer of Power Vol. VII", which read as follows:
"Q.?????? Nobody objects to interim dominion status. Suppose there are two constituent Assemblies. Is it open to one of them to declare itself absolutely independent and the other to declare itself a dominion: That was the point that Mr. Devadas Gandhi made.
"A.?????? If you grant independence and at the same time try to impose restrictions, the independence becomes a mockery.
"My dear Prime Minister, "I am much conceived to hear from my colleagues whom you consulted yesterday that you propose to call the India Bill, "The Indian Independence Bill". This, I am, assured, is entirely contrary to the text, which corresponds to what we shave previously been told were your intentions. The essence of the Mountbatten proposals and the only reason why I gave support to them in because they establish the phase of Dominion status. Dominion status is not the same as Independence, although it may be freely used to establish independence. It is not true that a community is independent when its Ministers have in fact taken the Oath of Allegiance to The King. This is a measure of grave constitutional importance and a correct and formal procedure and nomenclature should be observed. The correct title would be, it seems to me, "The Indian Dominions Bill". I should, however, be quite willing to support if it were called, "The India Bill, 1947" or "The India Self-Government Bill.
I am glad to hear you are considering such alterations.
Believe me, Yours sincerely, WINSTON S. CHURCHILL"
"My dear Churchill, I have delayed replying to your letter while awaiting any further communication from the Viceroy on the point raised by your colleagues as to the title of the Bill. Owing to the time factor, it was impossible to make a change evens if it was desirable.
"I do not agree with the point which you make. Dominion Prime Ministers constantly stress the point that they are independent States within the British Commonwealth. They bear allegiance to The King who is The King of all the Dominions. The insistence on independence does not touch the point of allegiance, but emphasizes the complete freedom of every member of the Commonwealth from control by any other member.
"I think this is a most valuable counter to the demand for independence outside tile Commonwealth as it shows that this demand can be satisfied within it. This is, in fact, the meaning of Dominion Status.
Yours sincerely, C. R. ATTLEE"
Mr Khalid Anwar next referred to the following passage from "The Statute of Westminster and Dominion Status" by K. C. Wheare, which reads thus:
"There appear to be three distinguishing characteristics of the Dominions. First, they were marked off from the rest of the political world by the characteristic that they were territorial communities, other than Great Britain, which shared with Great Britain a common allegiance to the Crown; they all had the same king".
"By this criterion the
Dominions were distinguished in status from foreign nations in international law and relations. They were shown to be within the British Empire'. But, thus far, they .are not distinguished from other portions of the British Empire.
India equally with Great Britain and the Dominions owed allegiance to the
Crown; all the territorial communities within the British Empire owed allegiance in some form or another. How were the Dominions to be distinguished from these other communities? There was a second criterion. The Dominions were all equal in status to Great Britain; and, consequently they were all equal in status to one another. They werein no way subordinate one to another in any aspect of their domestic or external affairs'. Equality is a difficult term. It is not certain what are its full implications here?????."
"223-A. Every High Court shall have power throughout the territories in relation to which it exercises jurisdiction to issue to any person or authority including in appropriate cases any government within those territories writs including writs in the nature of habeas corpus, mandamus, prohibition, quo warranto and certiorari or any of them."
Mr Khalid Anwar next submitted that under the Indian Independence Act, 1947, Britain transferred unconditionally and in unqualified manner all its powers to the people of Pakistan. This was irrevocable cession of power. He referred to the old version of section 19 of the Indian Independence Act, 1935, whereunder the Governor-General had the power to dissolve the legislature, to contend that such power was withdrawn in 1947. He then submitted that the conditions prevailing during that time do not fit in or apply to the present conditions.
Mr Khalid Anwar argued that in Reference No. 1 of 1955, sent by the Governor-General, the then Chief Justice Muhammad Munir, while expressing his opinion justifying the emergency, limited its scope by the following four conditions:
(i)???????? immediate action for maintenance of law and order;
(ii)??????? he exercises de facto powers, not de jure power;
(iii)?????? only those de facto powers which the legislature would certainly have given to the Governor-General if the emergency could have been foreseen trusting that whatever he had honestly done was for the safety of the State, will be ratified by an Act of Indemnity and;
(iv)?????? the legislature would have, without any doubt, approved and indemnified the same."
He contended that on the basis of Chief Justice Munir's formulation, the present Emergency deserves to be declared as unconstitutional.
73.?????? Arguments of Mr Khalid Anwar, can be summarized as follows:
1.???????? That he will not request this Court to do the impossible.
2.???????? That he referred to the nature of judicial power and its relationship with jurisdiction and maintained that no authority can take away power of this Court to confer legitimacy on a Government.
3.???????? That the deliberations of Chiefs of Staff of -the Armed Forces and Corps Commanders of Pakistan Army alluded to therein was a historical fact and not a source of power.
4.???????? That the Chief Executive had assumed an office which was non? existent.
5.???????? That there was no need to proclaim or continue Emergency as the situation in the country was calm and there were no agitations or demonstrations before the Army take-over.
6.???????? That a Proclamation ipso facto cannot be a source of power in the absence of law.
7.???????? That the doctrine of necessity was defective and in any event it cannot be invoked to justify the Military take-over and the instruments issued and actions taken subsequently.
8.???????? That the National Accountability Ordinance, 1999 offends against the settled law and human rights having created an offence retroactively, was unconstitutional and also did not meet the criteria of establishment of Special Courts.
9.???????? That the seven-point Agenda is in the best interest of the country which takes place under the law and not in violation of the law.
11.?????? That the suspension of the Constitution cannot be justified on the ground of good intentions of the Chief Executive.
12.?????? That the PCO No. 1 of 1999 is devoid of legal authority being based on the Proclamation of Emergency dated 14-10-1999 which had neither disclosed the source of power under which it was issued nor had conferred any power on the Chief Executive, who was its sole author.
First, the Court can condone past and closed transactions in order to avoid chaos and anarchy though they were not valid;
Secondly, the Court. can condone those actions which are conducive to return to constitutional rule. He, however, emphasised that the Court may either allow the petitions as a whole or in the alternative may confine it to a declaration in this case and lay down a roadmap and a time frame for return to democratic rule and holding of elections.
CONSTITUTION PETITION NO. 53 OF 1999
At the outset, Mr.
Habib-ul-Wahab-ul-Khairi, learned ASC, petitioner in Constitution Petition No.
53 of 1999, quoted verses 8 to 10 from Chapter V Sura Al-Ma'idah and verse 135 from Chapter IV Sura An?Nisa of the Holy Qur'an to contend that the Islamic concept of Adl', which is a universal concept and also provides for equity andIhsan', should be followed by this Court in' deciding the present and the connected petitions. He further submitted that it is the Judiciary alone which can make or mar the destiny of our nation, because the absence of justice invariably leads to the disintegration and ultimate destruction. He argued that
Judges are the watchmen and their watchman is their conscience as they are answerable to their conscience and God.
He. stressed that so far as Judiciary is concerned, there was no need of the PCO because the Courts. were functioning normally on October 12, 1999. He supported the law laid down in the case of Begun Nusrat Bhutto v. Chief of Army Staff and Federation of Pakistan PLD 1977 SC 657, with special reference to the observations made at pages 692 (citation-F), 715-717 (citation-UV), 721-22 and 733 (citation- HH). He also quoted an extract from the above judgment wherein views of Mr. Brohi and Syed Sharifuddin Pirzada were recorded , to the effect that notwithstanding fresh oath administered to the then Judges of the Superior Courts, their independence and impartiality to decide the cases had not been affected. He contended with vehemence that this Court has the power and jurisdiction to hear these petitions.
It was next contended that a Judge of the Superior Court cannot be removed otherwise than by following the procedure laid down in Article 209 of the Constitution. He further contended that the Judges are deputies of God for administering justice, therefore, the Judiciary should guard against attacks on its independence. He submitted that even after the promulgation of PCO, the Judges of the superior Courts have to abide by the provisions of the Code of Conduct and perform their primary duty of administering justice according to their conscience. He then quoted some extracts from the case of Miss Benazir Bhutto v. Federation of Pakistan PLD 1988 SC 416, which read as under:
"Our Constitution envisages democracy as ethos and a way of life in which equality of status, of opportunity, equality before law and equal protection of law obtains. It has its foundation in representation; it is not a system of self-government, but a system of control and the limitations of government. A democratic polity is usually identified by the manner of selection of its leaders and by the fact that the power of the government functionaries is checked and restrained. In a democracy the role of the people is to produce a government and, therefore, the democratic method is an institutional arrangement for arriving at political decisions in which individuals acquire the power to decide by means of a competitive, struggle for the people's vote. Fundamentally democracy rests upon the idea of freedom."
"Parliamentary Government is a government of the party and a party government is a vital principle of a representative government. The political party is a connecting link between the Executive and the Legislature, between the Cabinet and the Parliament. It is also a connecting link between the Cabinet and the people and between the Parliament and the people. For this reason the political parties are necessary and important features in a Parliamentary democracy. They are important because the group victorious at a general election becomes the government. In a nutshell a Parliamentary democracy depends for its success on the organization of political parties and its disciplined support of Parliamentary majority is sine qua non of Cabinet Government composed of the Prime Minister and the Ministers from the majority party. They, thus, provide leadership to public offices through the elections.. They are now necessary part of a democratic government. Rival parties make elections meaningful by giving voters a choice among candidates who represent different interests and points of view. The party or parties that are out of power serve as a "loyal opposition" as understood in Parliamentary democracy. That is, they criticise policies and actions of the party in power. In this way the party in power is called on to justify its actions and is made responsible to the people." .
"Therefore, there cannot be any doubt that the Ideology of Pakistan is based on Muslim nationhood and includes Islamic Ideology which in clear terms in the Constitution means Injunctions of Holy Qur'an and Sunnah and was the principal factor in the concept of Muslim nationhood. It is this Pakistan Ideology which resulted in the partition of the sub-continent and is knows as a two-nation theory."
"Quaid-e-Azam in his speech on the Pakistan Resolution of the All? India Muslim League on 24th March, 1940, said:
"Mussalmans are a nation according to any definition of opinion and they must have their home and their territory and their State. We wish our people to develop to the fullest spiritual, cultural, economic, social and political like in a way that we think best and in consonance with our own ideas according to the genius of our people. "
"The concept of Islamic Ideology is interwoven with the ideology of Pakistan and is inseparable as it is the foundation of two-nation theory. Therefore, "integrity of Pakistan" not only includes Ideology of Pakistan but also Islamic Ideology. Any invasion of "integrity of Pakistan" will inevitably lead' to an invasion of its sovereignty and vice versa. I may here state that maintenance of public order is an aspect of exercise of sovereignty. (Encyclopaedia Britannica, Vol. 17, Ed. .15, P.309. As will appear from the conclusions of Hamoodur Rahman, C.J., "public order" must be regarded to be included in the expression "sovereignty or integrity of Pakistan". This is not all. Any attempt to create doubts in the people's belief either vocally or by force against the comprehensive concept of Ideology of Pakistan which is the basis of the creation of the country will also be an invasion of the sovereignty or integrity of Pakistan as it would undermine the security and solidarity of the State by destroying the legal order."
"It was contended by the learned counsel for the petitioner that the Partition Agreement which guaranteed the safeguards of the minorities in Pakistan should also be regarded as a part and parcel of the expression "Ideology of Pakistan". I do not see how it can be included within it as this was a special creed which led to the Partition of India and has its own meaning and significance and even today preserves the sovereignty and integrity of Pakistan. The safeguards have been duly implemented in the Constitution in the shape of Fundamental Rights where there is no discrimination and so also in the Principles of Policy and elsewhere. The agreement stands apart and cannot be read as a constituent of the Ideology of Pakistan. "
"While raising this submission the learned Attorney-General filed to notice that this Order was an existing law under sub-Article (3) of Article 270-A and was not protected either under sub-Article (6) of this Article nor was it specified in the First Schedule under Article 8(3) (b) of the Constitution. Article 2 of this Order places it higher than the Constitution by the use of the words "shall have effect" which mean shall have legal effect, while Article 3 is worded so as to make it a substitute of Article 17(2) of the Constitution. It provides additional constraints apart from sovereignty or integrity of Pakistan. Upon the revival of the Constitution the Fundamental Rights were also revived including Article 17 without any amendment. Article 17(2) was, therefore, a higher norm than this Order which could not prevail as against it in spite of the enacting words "notwithstanding anything contained in the Constitution." It can only co-exist as a subordinate legislation if it is consistent with the Fundamental Right. Abdul Wali Khan's case has confined the restrictive clause to sovereignty or integrity of Pakistan. This being so other specified constraints are outside the purview of Article 17(2) and cannot operate to override the fundamental norm; and as President's Order No. 20 of 1978 is existing law under sub-Article (3) of Article 270-A, no question of any repeal by implication arises. What I find is that this Order is the basis for extensive amendments in section 3 and the other provisions of the Act by Ordinance 41 of 1978. Before the amendment of this section the only words which found place in it were "sovereignty or integrity of Pakistan" which were inserted in the light of the constraints in Article 17(2) of the 1973 Constitution. Sections 3-A and 3-B of the Political Parties Act, 1962, were inserted by Ordinance 42 of 1979 on 30-8-1979 and 3-C by Ordinance 53 of 1979, 'dated 8-10-1979. Section 3-B was further amended by Ordinance 52 of 1979 promulgated on 27-9-1979. President's Order 20 of 1978 by its status as being an ordinary law cannot give any protection to the impugned as being an ordinary law cannot give any protection to the impugned provisions of the Political Parties Act as against Fundamental Right 17(2). Therefore, even if it co-exists with the Political Parties Act, 1962, it is of no effect although it remains on the statute book."
"8.??????? The foregoing observations are for the implementation of a very important part of the mandate of Article 17(2). It might help avoid any large scale national effort to overthrow a fully entrenched political party which otherwise falls within the mischief of Article 17(2) - by unorganized force or by organized one which might be projected as right. In either case the Courts including the superior ones are the worst-hit, besides other consequences. For example, superior Courts, in such situations are made to lose their effectiveness; which in ordinary course, in the case of normal Government, can and do exercise checks through the balancing process, in eventualities of undue acquisition or use of State Power. Our code of conduct, when left free to operate ordains as follows:--
"The Constitution, by declaring that all authority exercisable by the people is a sacred trust from Almighty Allah, makes it plain that the justice of this nation is of Divine origin. It connotes full implementation of the high principles which are woven into the Constitution, as well as the universal requirements of natural justice. The oath of a Judge implies complete submission to the Constitution, and under the Constitution to the law .... On equipondernace stand the heavens and the earth. By equiponderance, oppression meaning unjust and unequal burdens is removed. The Judge's task is to secure that such equality should prevail in all things."
He emphasised that Pakistan owes its existence to Islamic ideology and justice or 'Adl' is the pivot of Islam, therefore, the Judiciary in Pakistan is not a creation of the Constitution, as is assumed, but it came into existence with the creation of the country and can never be abolished. He argued that the Judiciary derives its powers and duties from the Islamic principles and since Islam gives fundamental importance to the system of justice, the Courts will continue to exist and the Judges will perform their functions in accordance with the Islamic principles and their conscience. He further submitted that with the suspension of the Constitution, Islam is not suspended. In the beginning, all the powers, viz., executive, legislative and judicial, vested in one man, the Holy Prophet (p.b.u.h.), but with the advent of the institution of Khilafat, they were gradually separated.
He contended that whenever the Armed Forces take over the government of the country, they promulgate PCO and the Judges of the Superior Courts are required to take fresh oath under it. Elucidating his point the learned counsel submitted that the oath taken by the then Judges of the Superior Courts under the PCO of 1981 and the oath taken by the Judges of this Court under the Order 1 of 2000 was only recognition of the ground realities and it did not disqualify, in any way, the Judges of the Superior Courts from doing justice according to the law and their conscience. He submitted that in other words, with the taking of fresh oath by the Judges of the Superior Courts under the new dispensation, the judicial system of the country has neither been abolished nor replaced by a new one. In this behalf, he referred to the following observations of this Court in Begum Nusrat Bhutto's case PLD 1977 SC 656:-
"Mr. Brohi as well as Mr. Sharifuddin Pirzada were also asked to address the Court on the possible effect and implications of the new oath of office administered to the Judges of the -Supreme Court and the High Courts after the imposition of Martial Law. They both stated that, in their view, the new oath has not in any manner restricted the independence of the superior judiciary, nor affected their obligation to perform their judicial functions according to law; it only indicates that the superior judiciary, like the rest of the country, has accepted the fact, which is even otherwise also evident, that on the 5th of July, 1977, a radical transformation took place in the pre-existing Legal Order. Both the learned counsel are agreed, and Mr. Yahya Bakhtiar, learned counsel for the petitioner, joins them, that the taking of the fresh oath by tile Judges of this Court does not in any way preclude them from examining the question of the validity of the new Legal Order and decide the same in accordance with their conscience and the law."
At page 704-K it was observed:-
"It will be seen that the explanation given by General Muhammad Ziaul Haq for the Army.'s intervention is a true reflection of the situation which had been developing over the past four months as a result of the Pakistan National Alliance agitation and repudiation of Mr. Bhutto's constitutional and moral authority as Prime Minister of Pakistan. The statement correctly brings out the necessity for the imposition of Martial Law. It is also clear that this sincere and unambiguous declaration of his objectives by the Chief Martial Law Administrator was a major factor in persuading the people of Pakistan to willingly accept the new dispensation as an interim arrangement to bridge the gap between the break-down of the previous administration and the induction of the new elected Government under the terms of the 1973 Constitution. The new arrangement, therefore, acquired its effectiveness owing to its moral content and promise of restoration of democratic institutions. I may add here that the willingness of the Judges of the superior Courts to take the new oath after the proclamation of Martial Law was also founded upon the same considerations. "
Justifying the Military take-over, Mr. Khairi submitted that removal of the Chief of the Army Staff, who was holding a constitutional post and was responsible for the defence of the country, in a derogatory manner, amounted to high treason, especially in view of the fact that he was first appointed as Chief of the Army Staff by the then government and was later appointed as Chairman, Joint Chiefs of Staff Committee and confirmed as such just a week before his removal. There was, thus, no option with the Army but to take over the affairs of the country as a last resort.
He alleged that a conspiracy was hatched by Mr. Nawaz Sharif against the Armed Forces, whereby he removed Gen. Pervez Musharraf while the latter was out of Pakistan and instead appointed Lt. Gen. Ziauddin Butt.
Mr. Khairi next contended that Mr. Nawaz Sharif was responsible for creating dissension among the ranks of the Armed Forces. In this connection, Lt. Gen. Tariq Pervaiz had had a meeting with the former Prime Minister without permission of the higher Army authorities, which was a grave breach of discipline. Thus, he was retired for violating the discipline of the Army.
Mr Khairi submitted that since with the appointment of Lt. Gen. Ziauddin Butt as Chief of the Army Staff, the defence of the country was jeopardized and the order of removal of General Pervez Musharraf from his office, passed by the former Prime Minister had no sanctity in law, therefore, by refusing to obey an illegal order, the military authorities had not committed any wrong. In this context, reliance was placed on Begum Nusrat Bhutto's case, wherein at page 727 (EE), it is observed as under: -
"It is thus abdundantly clear that submission to the authority of the ruler and obedience to his commands does not extend to illegal and un-Islamic directives or orders???.."
He further relied on Controller of Patents and Designs, Karachi v. Muhammad Quadir Hussain 1995 SCMR 529 at page 533 placitum-B and 534 placitum-C, which read as under: -
"There can be no cavil with the proposition that the Government of Pakistan or for that matter any of the holder of its offices, or any Government functionary do not enjoy any conventional prerogative as was or is available to Crown in England except those discretionary powers which are either specifically conferred by the Constitution or under any law passed by the Parliament. We are also of the view that any discretionary power available to Government or its functionaries in the nature of prerogative either under the Constitution or under any of the Act of the Parliament is subject to the-process of Judicial review by the Superior Courts, in accordance with their jurisdiction under the Constitution. However, any exercise of discretionary power in the nature of a prerogative claimed by the Government or holder of any of its offices, or its functionaries has to be justified either under some statute law or under the provisions of the Constitution, before it is pressed into service before a Court.
"7.??????? Considering the above definitions of the word prerogative', we are of the view that the expressionprerogative of the Federal Government, used in section 79 of the Act is to be understood in the sense of a discretionary power of the Government conferred on it under the provision of the Act.
Prerogative as commonly understood a divinely right or an unbridled or uncontrolled discretion of a Ruler or a Sovereign is neither available in
Pakistan nor it is contemplated in that sense, under section 79 of the Act.
Since the prerogative of the Federal Government mentioned in section 79 of the
Act is exercisable only as a discretionary power wider the Act in public interest, it is naturally subject to review by the Superior Courts in exercise of their power of judicial review under the Constitution. A careful study of various provisions of the Act will show that the right to claim a patent under the Act is not an absolute right. For instance, the Controller, under section 69 of the Act has the discretion to refuse to grant a patent for an invention or register a design of which the use would, in his opinion, be contrary to law or morality. The controller, under section 68 of the Act, in case of any doubt or difficulty arising in giving effect to the provisions of the Act, is empowered to make a reference to the Central Government for seeking directions in the matter. By reading sections 68 and 69 of the Act together it can be gathered that the Central Government in exercise of its prerogative or discretionary power, under section 79 of the Act, can withhold the grant of a patent or restriction of a design, if it reaches the conclusion that such withholding will be in the public interest or for the public good or would be against any provisions of the Act or morality."
He also sought support from the judgments reported as Zahid Akhtar v. Government of Punjab PLD 1995 S.C. 530; in this behalf.
government' is not defined in the Constitution, but certainly Prime Minister alone is not thegovernment'. It is the cabinet headed by the Prime Minister. He submitted that the order passed by the Prime Minister removing the Chief of the Army
Staff was not approved by the Cabinet, but was the result of whims of one man.
He next submitted that though under the Constitution, procedure for the appointment of Chief of the Army Staff is given but no procedure for his removal has been laid down therein. In this behalf, he also referred to sections 16, 17 and 20 of the Pakistan Army Act and contended that procedure for dismissal or removal of personnel of the Armed Forces is laid down therein, but it does not contain any provision regarding removal of the Chief of the
Army Staff. The above sections read thus:-16.?????? Dismissal or removal by Federal Government.-The Federal Government may dismiss or remove from the service any person subject to this Act. .
17.?????? Dismissal or removal by Chief of the Army Staff or other authorised officer.- (1) The Chief of the Army Staff may dismiss or remove from the service any junior commissioned officer or warrant officer or any person enrolled under this Act.
(2)??????? An officer having power to convene a district Court martial or an officer not below the rank of lieutenant-colonel empowered by the Chief of the Army Staff in this behalf may dismiss or remove from the service any person enrolled under this Act who may be serving under his command.
20.?????? Discharge or dismissal when out .of Pakistan.- (1) Any person subject to this Act, who is entitled under the conditions of his service to be discharged, or whose discharge is ordered by competent Authority, and who, when he is so entitled or ordered to be discharged, is serving out of Pakistan, and requests to be sent to Pakistan, shall, before being discharged, be sent to Pakistan with all convenient speed.
(2)??????? Any person subject to this Act who is dismissed from the service and who, when he is so dismissed is serving out of Pakistan, shall be sent to Pakistan with all convenient speed.
(3)??????? When any such person as is mentioned in subsection (2) is sentenced to dismissal combined with any other punishment, such other punishment, or in the case of a sentence of imprisonment for life or for a shorter term, a portion of such sentence, may be inflicted before he is sentto Pakistan.
Explanation- For the purposes of this section, the word "discharge" shall include retirement or release, and the word "dismissal" shall include removal."
He was of the view that it is the constitutional duty of the Supreme Court to safeguard the defence of the country and even the Armed Forces are obliged to obey the orders passed by this Court in this regard. In support of his plea, he relied upon the judgment reported as Al-Jehad Trust v. Federation of Pakistan 1999 SCMR 1379, wherein at page 1396 (citation F) it was observed as under:-
"20. Keeping in view the above judgments of this Court in the cases of Mian Muhammad Nawaz Sharif (supra), Azizullah Memon (supra), AI-Jehad Trust (supra), Mahmood Khan Achakzai (supra) and Mehram Ali (supra), and the above Articles 2A and 17 of the Constitution, the people of Northern Areas are entitled to participate in the governance of their area and to have an independent judiciary to enforce inter alia the Fundamental Rights." .
At page 1400 of the above report, it was observed thus:
"25.It is apparent that direction/directions to take administrative actions/measures required by the Constitution can be issued against the Federation, but no direction can be issued to the Legislature to legislate a particular law. However, a direction can be issued to the Federation to initiate administrative and legislative measures for complying with the mandate of the Constitution ...."
He vehemently contended that democratic governments come into existence as a result of free and fair elections, but all the elections except the election for the Constituent Assembly held in Pakistan, were a total fraud, therefore, the governments coming into existence on the basis of such fraudulent elections had no constitutional and moral sanctity. First elections under the 1973 Constitution were held on 7th March, 1977, which were not free and fair and their real facet is to be found in the judgment in Nusrat Bhutto's case (supra), wherein this Court dilated upon the details of large scale rigging that took place in those elections and concluded that the government of Mr. Bhutto had no legal and moral authority to continue in office. He further contended that in order to guard against the corrupt practices in elections, Article 218 of the Constitution has laid down a mechanism, but unfortunately the commandments of the Constitution are not obeyed and that PML (Nawaz Group), in its first term, after its coming into power, omitted sections 48, 49, 50 and 51 of the Representation of People Act, 1976 whereby the restrictions regarding election expenses were removed and resultantly only moneyed persons in Pakistan could contest elections and it has been rendered impossible for an ordinary citizen to participate in the election. He next contended that political cell of ISI played a major role in election of the members of the Parliament by distributing huge sums of money among the candidates of IJI and, thus, paved the way for corrupt elements to come into power, who were not true representatives of the people of Pakistan. He submitted that no action was taken against corrupt members of parliament under Article 63 of the Constitution. Dilating further on those elections, Mr. Khairi referred to affidavits filed by General Asad Durrani, the then Chief of ISI and Gen. Naseerullah Babar wherein details of the amounts disbursed by the ISI among various politicians have been given. He emphasized that in presence of the political cell of the ISI, fair elections cannot be held and that it is the legal duty of the present regime to abolish this cell. He further contended that in 1997 Elections the so-called "heavy mandate" claimed by the former government was also the result of manipulation of the ISI and it was for this reason that Mr. Nawaz Sharif had refused to abolish this cell and that the mandate so obtained by Nawaz Sharif was a farce and had no lawful and moral authority. He submitted that democracy means 50% votes at least and that in fact the people of Pakistan had never voted to that extent and the governments had only technically won the elections. That is why when such governments were removed, there was none to express remorse for them.
Mr. Khairi next contended that every regime considers the Judiciary as a hurdle in its way and tries to eliminate or undermine it.
Mr. Khairi submitted that the Court should explore as to what laws should hold the field during the period the Constitution is held in abeyance In this behalf, he referred to the judgment reported as Federation of Pakistan v. N.-W.F.P. Government PLD 1990 SC 1172 wherein at page 1175 of the report it was observed:
"In such state of vacuum, vis-a-vis, the statute law on the subject, the common Islamic law/the injunctions of Islam as contained in the Qur' an and Sunnah relating to the offence of Qatl and Jurh (hurt) shall be deemed to be the law on the subject."
He also, referred to the case of Mian Aziz A. Sheikh v. The Commissioner of Income Tax, Investigation, Lahore PLD 1989 SC 613, wherein at page 626, it was observed:
"But, this prohibition in clause (2) of Article 227 does not apply to decisions by functionaries of State of judgment, as distinguished from exercise of law-making or statutory rule-making authority, they take decisions. In other words whatever a decision is contained in any such judgment of any such. functionary which lays down a rule of law or declares so as a rule of law the superior Courts, shall be within their competence in a properly instituted proceedings to strike it down both under the general mandate contained in clause (1) of Article 227 as well as under Article 2A read with the Objectives Resolution."
"8.??????? In this context it may be observed that while interpreting Constitution, enactments, rules and regulations having the force of law and examining orders, acts and actions of Government functionaries/authorities the Court is competent to apply well-?recognised principles of Islamic Common Law and such interpretation which is in conformity with the Injunctions of Islam. In the fields not occupied by statutory dispensation, principles of Islamic Common Lava or principles in conformity with Injunctions of Islam can be pressed into service.
"9.??????? Article 2A is one of the provisions of the Constitution which strives at bringing the existing law in conformity with the Injunctions of Islam and also gee to it that no law in conflict with such Injunctions is legislated. The method for testing such legislation and enactments has been provided under the Constitution. One is provided in Article 227 in Part IX of the Constitution and the other and more effective method is provided by Chapter 3-A of Part VII of the Constitution; that is the Federal Shariat Court. Article 203-D vests powers and jurisdiction in the Federal Shariat Court to examine and decide the question whether or not any law or provision of law is repugnant to the Injunctions of Islam. On coming to an affirmative answer it shall give its decision with reasoning for holding such an opinion and shall specify the day on which the decision shall take erect. However, if any party files an appeal before the Supreme Court, effect shall not be given till such time the appeal is disposed of. Consequences of declaring any law or provision of law to be repugnant to the Injunctions of Islam are contained in Article 203-D(3). The President and the Governor in cases of law within their. respective jurisdiction shall take steps to amend the law so as to bring such law or provision of law in conformity with the Injunction-s of Islam and such law or provision of law shall cease to have effect on the day on which the decision of the Court takes effect. Therefore. a proper scrutiny of the provisions of law by the . Federal Shariat Court and the Shariat Appellate Bench of the Supreme Court with an interregnum period has been provided to enable the President and the Governor, as the case may be; to move the Legislature to bring the law in conformity with the Injunctions of Islam. The intervening period has been provided to enable the Legislature to legislate proper laws and there may not be a vacuum of lawlessness which may create complications and confusion. The process. of Islamisation of the laws is an important and difficult subject. The lead given by Pakistan in this regard is being watched with interest by all the Muslim countries who are anxious to bring their laws in conformity with the injunctions of Islam and by the non-Muslim countries as well. Any hasty action without the process of Ijma at Ummah level may lead to difficulties and confusion which may prove irreversible. Furthermore, due to sudden change, complex problems in economic, commercial and financial fields may arise creating difficulties. However, it does not mean that in the fear of such new controversies and problems the process of Islamisation may be retarded or stopped. It is an ongoing process. It has to take effect with utmost despatch, vision and regularity. .
He also referred to the case of Fazle Ghafoor v. Chairman, Tribunal of Disputes, DIR, SWAT at Chitral at Mardan 1993 SCMR 1073 wherein at page 1077 Placitum-D, it was observed:
"This mode of proof is adaptable in the Islamic dispensation also, even if not in any other. When there is such a vacuum on a question of law left by statutory silence, the prevailing mode having full Constitutional support, would be that of Islamic common law. See Muhammad Bashir v. The State PLD 1982 SC 139.
He also referred to Ghulam Hamdani v. Muhammad Iqbal 1993 SCMR 1083, wherein at page 1089 Placitum-C, it was observed:
"In the case of Federation of Pakistan v. N.-W.F.P. Government PLD 1990 SC 1172 the Shariat Appellate Bench of this Court, though in a criminal matter, expressed the view that in a state of vacuum like the one in question the injunction of Islam as contained in the Qur'an and Sunnah shall be deemed to be the law on the subject. The appellant has pleaded Talbs in the plaint and has based his right of pre-emption on contiguity and participation in immunities and appendages such as the right of way. This much was sufficient to complete the pleading."
Case of M. Ismail Qureshi v. M. Awais Qasim 1993 SCMR 1781, was also pressed into service wherein it was observed:
"It is not the students organization which is primarily responsible for the observance of the ideological basis of Pakistan in the educational institutions; rather the institution and its functionaries are not only responsible primarily but always responsible in this behalf. A functionary in a Pakistan institution who is against the ideological basis of Pakistan, as is enshrined in our Constitutional set-up; or is against the training of his wards entrusted by the institution to him in line with it; is against or neglects and does not propagate ideology of Pakistan, amongst the students community, has no right to remain in the institution. And if the institution itself commits such acts or omissions, it is better to close, rather than to permit it, to contravene the Constitutional set-up of Pakistan. Therefore, it will be more advisable to re-entrust the education and training of the students on the lines of the ideology of Pakistan to the teachers and the institutions themselves under the pain of penalty. This of course is with a clarification that the groups under whatever name, through which the so-called Union activity will be revived in the educational institution, would not be debarred from the ideological path and educating and training themselves in that behalf; but only with the assistance, guidance and help from their parents, their teachers and institutions. No one student or group can be given an unbridled right to control and coerce another student or group. The parental atmosphere jurisdiction and philosophy has to be followed on this subject also. "
"The argument advanced by the Jamiat; which has been dealt with above is not only relevant; but is also important in another context of practical application in Pakistan. It is also in line with the whole gamut of our statecraft. Its features are spread over several parts of our Constitution and the entire Constitutional set-up can be very useful for future ideological orientation in our polity. . Thus, the possibility of creating a mid-way, political party structure as some youth wings are, cannot be excluded altogether. But instead of riding the wings of educational institutions or flying under the wings of the student community; the politically oriented/minded youth after completing the education and/or training in the institutional atmosphere, may join those youth wings of the like minded political parties. Those who are imbued with national service and we do feel that entry in political life is also a national service, might be able to develop such a youth political set-up, which would obviate the "indulgence in politics" in the educational institutions."
"Such experiment can be faithfully and honestly undertaken by educated young people, fresh from the Universities who are full of like and vigour with national spirit, might join the profession of politics in the form of apprentices or make junior political parties. If such intermediary system develops, the linkage with senior parties and senior politicians would automatically start developing. And without any "indulgence in politics" in the educational institutions, final stage students community also, might start looking towards the intermediary political organizations in the country. This possibility cannot and should not be treated as a verdict by this Curt. It is only a possibility which amongst many others can be visualised as to how those young people who have clearly and cleanly passed their allotted time in the educational institutions and want to improve the society through their participation in the political like of the country, might start a beginning with an organizational set-up like the one at the youth wing stage. But this set-up if develops will also have to be kept out of the educational institutions. They would not be provided facilities in these easy to reap, fields."
Reference was also made to the case of Zaheeruddin v. The State 1993 SCMR 1718 wherein at page 1773 (citation-QQ), it was observed:
"The contention, however, has not impressed us at all. The term `positive law', according to Black's Law Dictionary, is the law actually enacted or adopted by proper authority for the Government of an organised jural society. So; that term comprises not only enacted law but also adopted law. It is to be noted that all the above-noted cases were decided prior to the induction of Article 2A in the Constitution, which reads as under:-
"2A. Objectives Resolution to form part of substantive provisions.- The principles and provisions set out in the Objectives Resolution reproduced in the Annex are hereby made substantive part of the Constitution and shall have effect accordingly."
"This was the stage, when the chosen representatives of people, for the first time accepted the sovereignty of Allah, as the operative part of the Constitution, to be binding on them and vowed that they will exercise only the delegated powers, within the limits fixed by Allah. The power of judicial review of the superior Courts also got enhanced."
Mr. Khairi further contended that Article 63(1)(g) of the Constitution does not permit anyone to ridicule the Judiciary and the Armed Forces. However, the said provision of the Constitution is not implemented by the Speaker of the National Assembly because he fears vote of no confidence by the majority party in case proceedings for violation of this Article are initiated by him against any member of the Assembly.
He also contended that the Constitution did not provide a solution for the grave crisis created by the former Prime Minister, who not only created dissension in the ranks of the Army and thereby attempted to weaken the defence of the country but also endangered the territorial integrity and independence of the country. He submitted that the Court is under a constitutional duty to ensure that the integrity of the territories of the Federation, its independence and all its rights including its sovereign rights on land, sea and air are safeguarded by the Armed Forces of Pakistan, therefore, the steps taken by the Chiefs of Staff of the Armed Forces and Corps Commanders of Pakistan Army, after due deliberations and decisions, were imperative and should be validated in the interest of Pakistan.
He submitted that since under Article 243 only appointments of the Chairman of Joint Chiefs of Staff Committee, Chief of Army Staff, Chief of Naval Staff and Chief of Air Staff have been provided and nothing has been provided as to their removal from office, therefore, how the ex-Prime Minister could remove General Pervez Musharraf, the way it was done, in that he was both the Chairman, Joint Chiefs of Staff Committee as well as the Chief of the Army Staff at the time of his removal.
He next submitted that neither the Constitution visualized an unfettered right to rule the country to the ex Prime Minister nor the so-called heavy mandate had granted him the right to become an absolute ruler nor it can be said that success by securing 13 or 14 % votes by PML (N) was a heavy mandate in any sense of the term.
ARGUMENTS OF MR. SHARIFFUDDIN PIRZADA
Syed Sharifuddin Pirzada, learned Senior ASC appearing on behalf of the Federation submitted that the main arguments on facts as well as on law will be advanced by the learned Attorney-General and that he will only be covering some of the legal points viz. judicial review and applicability of the doctrine of necessity to the facts and circumstances of the present case. He submitted that this Court is dealing with the situation, which arose on 12th October, 1999 in respect whereof two speeches/statements, dated 13th October, 1999 and 17th October, 1999, have to be read together to spell out the circumstances and reasons for the intervention of the Armed Forces: He further submitted that the above speeches/statements of the Chief Executive clearly make out that true democracy is to be restored as soon as possible and certain measures for the time being are to be taken to improve the conditions in the country. He next submitted that on 12th October, 1999 situation arose for which the Constitution provided no solution, therefore, the intervention by the Armed Forces became inevitable. He emphasised that the intervention by the Armed Forces has saved the country from disastrous consequences and accordingly it is valid and justified on the basis of the doctrine of necessity and the principle of salus popult supremo lex. Supporting the intervention by the Armed Forces, he further submitted that there was no political and economic stability in the country; corruption and bank loan defaults were rampant; there was no accountability or transparency; Mian Nawaz Sharif's constitutional and moral authority stood completely eroded and that the situation was somewhat similar and analogous to the situation that prevailed in July, 1977; the adoption of 13th Amendment had removed the checks and balances in the Constitution and the Senate, the National Assembly and Provincial Assemblies were closely associated with the former Prime Minister and there was no democracy but one man rule, which was rightly displaced.
On the question of judicial review he referred to the Objectives Resolution, which inter alia, envisages that independence of Judiciary is to be fully secured. He submitted that the Preamble to the Constitution takes notice of Quaid-e-Azam's declaration about democratic set-up and social justice which are the basis of Rule of Law. Syed Sharifuddin Pirzada, however, made the following statement at the Bar:
"So, in consonance with those principles I have formulated the points which I will be placing before your lordships, but let' me make one thing clear. On this issue I am expressing my views as a counsel, which I am entitled to. I have done so in earlier cases. Therefore, I am approaching this question from that angle."
"The requires that the judiciary shall decide matters before it in accordance with its impartial assessment of the facts and its understanding of the law without improper influences, direct or indirect, from any source. The Judiciary in Pakistan is independent. It claims and has always claimed that it has the right to interpret the Constitution and any legislative instrument and to say, as to what a particular provision of the Constitution or a legislative instrument means or does not mean, even if that particular provision is a provision seeking to oust the jurisdiction of the Supreme Court."
"Judicial review, must, therefore, remain strictly judicial and in its exercise, Judges must take care not to intrude upon the domain of the other branches of Government."
"There is yet another, and a stronger reason for holding that the power of judicial review continues. The 1973 Constitution provides for a clear trichotomy of powers between the executive, legislative and judicial organs of the State. However, owing to reasons of necessity, the executive and the legislative power now stands combined in one authority, for the reason that these two organs of the State had lost their constitutional and moral authority in the circumstances arising since the 7th of March, 1977, but no such considerations arose in regard to the judicial organ of the State. Accordingly, on no principle of necessity could powers of judicial review vested in the superior Courts under the 1973 Constitution, be taken away."
He also referred to Pir Sabir Shah's case (PLD 1994 SC 738), wherein at page 765, paragraph 17 placitum C, it was observed:
"I am, therefore, of the view that clause (2) of Article 236 will not cover a proclamation which is without jurisdiction, coram non judice or mala fide and the Superior Courts will have jurisdiction to examine a proclamation from the above three jurisdictional legal aspects. "
98.?????? Syed Sharifuddin Pirzada formulated his points as under:
1.???????? The intervention by the Armed Forces of Pakistan on 12th October, 1999 is valid.
2.???????? The Defence Forces are viable and vital institution of the country. Attempts were made to destabilise them and to create dissension within their ranks, which would have adversely affected the defence, security and territorial integrity of Pakistan.
3.???????? The pernicious attempts were contrary to the Preamble of the Constitution and Objectives Resolution whereunder the integrity of the territory of the Federation, its independence and all its rights, including the sovereign rights on land, sea and air are to be safeguarded.
4.???????? As it is, due to collusion between Lord Mountbatten and Sir Cyril Radcliff, Pakistan got truncated territory, the tragic circumstances in which it was dismembered in 1971 are well-known. The intervention by the Armed Forces has saved the country from disastrous consequences.
5.???????? On 12th October, 1999 situation arose for which the Constitution provided no solution and the intervention became inevitable.
6.???????? Mian Nawaz Sharif's conviction on serious offences is under appeal. However, prima facie, it confirms the stand and the steps taken by the Armed Forces.
7.???????? The claim of heavy mandate by Mian Nawaz Sharif in election is belied by the facts and figures available on the record.
8.???????? The adoption of the 13th Amendment removed the checks and balances in the Constitution.
9.???????? The Senate, the National arid Provincial Assemblies were closely associated with the former Prime Minister. There was no democracy, but despotism, which was rightly displaced.
10.?????? There were no political and economic stability in the country. Corruption, bank loan defaults were rampant. There was no accountability or transparency. Mian Nawaz Sharif's Constitutional and moral authority stood completely eroded.
11.?????? The situation was somewhat similar and analogous to the situation that prevailed in July 1977.
12.?????? In the exceptional circumstances Doctrine of State Necessity and the principle of Salus populi suprema lex are fully applicable.
13.?????? The Doctrine of State Necessity is well-known and has been
recognised by Islam and other religions and accepted by Hugo Grotius, Chitty, De Smith and other jurists and the superior Courts of various countries to fill the vacuum and to bridge the gap. Even the mother Parliament's existence is traceable to the Doctrine of Necessity.
14.?????? The judgment in Nusrat Bhutto's case PLD 1977 SC 657 has been approved among others by the Court of Appeal of Grenada (1986 LRC (Constitution) 35 and reaffirmed in Achakzai's Case PLD 1997 SC 426. The caution mentioned in the last case that checks and balances are necessary for prevention of such situations was completely ignored.
15.?????? The same caution is reflected in concrete terms in the drafts prepared by Justice A. R. Cornelius and Justice Hamud-ur?Rahman, former Chief Justices of Pakistan.
16.?????? The cases of Mehram Ali PLD 1998 SC 1443 and Liaqat Hussain PLD 1999 SC 504 do not deal with the situation that arose on 12-10-1999 and/or affect the principles laid down in Nusrat Bhutto's case.
a) Martial Law was not imposed.
b) The Constitution was not abrogated and remains in abeyance.
c) The Courts continue to function.
d)???????? The Fundamental Rights, not in conflict with the Proclamation and the Orders continue to be in force.
18.?????? The Proclamation of Emergency, PCO and other Orders are not sub-constitutional but of extra-constitutional nature.
19.?????? The intervention is not of a permanent nature, but for a limited period and is of a temporary character to enable the country to return to a true democratic way of life as soon as possible.
20.?????? The course embodied in Nusrat Bhutto's case is fully attracted.
Particular reference was also made to a passage from Nusrat Bhutto's case at pages 708-709, which reads thus:
"Mr. Sharifuddin Pirzada has next drawn our attention to certain Articles in the Majelle in support of his proposition. Article 17 enjoins that "Hardship causes the giving of facility; that is to say, difficulty becomes a cause of facility, and in times of embarrassment it becomes necessary that latitude should , be shown." Article 21 says that "Necessities make forbidden things canonically harmless". Article 22 lays down that necessities are estimated according to their quantity, and Article 26 embodies the maxim salus populi suprema lex by saying that "To repel a public damage a private damage is preferred." He submits that although these maxims are directly relevant to cases of private necessity but the principle can certainly be extended to State necessity."
"Before I go further, one important episode is worth recalling. Lord Mountbatten returned to Delhi on 30th May; but two days earlier on 28th May Quaid-e-Azam expressed a wish to meet senior Muslim officers posted at Delhi and a meeting was arranged at the residence of Hasnie to maintain secrecy: Quaid also directed that no Press people should be present and not a word of what he was going to say there should appear in the Press. The meeting was held on 29th May and he came there accompanied by Liaquat Ali Khan, Nishtar and Chundrigar. On arrival he spotted one Muslim officer, who was in the Information and Broadcasting Department and so known to him personally. He asked him to leave as he came under the category of Press people. The meeting was arranged in the open on the spacious lawns of Hasnie's house and the Quaid feared that he might be overheard across the road. So, he asked everybody to get nearer and sit on the carpet. He also sat down leaving his sofa seat. Liaquat, because of his bulk, continued sitting on the sofa."
"In clear measured tones, he spoke for nearly half an hour and then invited questions. Even in this hour of triumph he showed no sign of emotion nor did he indulge in hyperbole or_self-glorification except one sentence, and that too in matter of fact tone that "future generations would say that Muslim League won them Pakistan. What does Muslim League consist of: myself and my Stenographer?"?????.The two questions that' stand out in my memory were which for their perspicuity still surprise me. They were asked by one not so senior an officer a Deputy Director in the inspection wing of the Supply Department, Iqbal by name. After Quaid replied to a few questions on the status of the Muslims outside Pakistan, which also stunned a few, Iqbal said: "Sir, I have two questions to ask: The first is what is the guarantee that on establishment of Pakistan a coterie of people would not take over the country and run it in their own particular interest" and waited for a reply Quaid only said, "And your second question?" "Sir, the second is what will happen if at any time later Bengal wishes to secede from Pakistan". The Quaid kept quiet for a few seconds-and then said: "The answer to both of your questions is not with me. It is with you. You, Muslims, will have to create conditions in which Bengal exists happily with you as they have helped you in the common struggle and create such forceful public opinion too that no coterie of people get control and run the country in its own interest. After all guardians of democracy are the people; not your Quaid or his successors."
ARGUMENTS OF MR. AZIZ A. MUNSHI, LEARNED ATTORNEY GENERAL FOR PAKISTAN
Mr. Aziz A. Munshi, the learned Attorney-General for Pakistan began his arguments with the submission that it is with a sense of responsibility that in making submissions before this Court, it was not his intention to cast aspersion on any one and that when he would speak in respect of the parliamentarians particularly the former Prime Minister, it should be clearly understood that this is not with a view to maligning any one. It is only intended to meet the case and put the facts before this Court. He further stated that in doing so, he would be only doing his duty as Attorney-General.
He submitted that the country is faced with a situation where the former Prime Minister stands convicted on 6th April, 2000 on charges of hijacking and terrorism and at the same time his associates are also accused of various offences. He stated that the leader of the opposition stands disqualified and it seems, she has chosen to abdicate responsibility of taking over or responding to the political challenge, which is facing the country and that the parliamentarians from both the major parties, viz. Pakistan Muslim League and Pakistan People's Party have leaders who are either disqualified or do not appear to be qualified, prima facie unde0judgments of various Courts in various proceedings and thus the present situation can be called one of political vacuum. He submitted that a democratic polity to which the people of Pakistan are committed requires responsible parliamentarians and not a vacuum in that behalf; it requires and presupposes that elected representatives are qualified, present and alive politically to steer the governance of the country and to take responsibility in terms of the sacred mandate given by the Constitution. He emphasized that the country needed a body of men, who were responsible, who were above board and who were accepted by the people as their elected representatives and who were not only responsible to the people themselves, but also to their own conscience and the conscience of those who had elected them. He contended that there was large scale accusation of corruption, allegations of disqualification in presence of convictions and judgments, a large scale plunder of national wealth, a breakdown of the economy and finally, worst of all, an attempt to create dissension and disunity in the only disciplined institution of the country besides the Judiciary, namely, Army, which almost subverted that institution and created a dangerous challenge to the very existence of Pakistan.
The learned Attorney-General submitted that keeping in mind the gravity of the events which occurred on the 12th of October, 1999, this Court would find that the Chief of Army Staff was sent abroad on official duty and was in the air at an altitude of 25000 ft, on the Indian ocean midway between Colombo and Karachi when the unfortunate events happened, which have landed the country today where it is. He submitted that had the incident succeeded, horrendous consequences resulting from this course would have rendered the country with an Army divided in its ranks and entangled in a civil war. He submitted that without mentioning the ugly facts and details of the incident, which happened at the Karachi Airport, the fact remains that a body of 300 policemen went to arrest the Chief of Army Staff and according to General Pervaiz. Musharrafs own speech delivered on 13th October, his life was put in danger and the plane carrying him was asked to land anywhere outside Pakistan and possibly in India. According to the learned Attorney-General, this kind of attitude and action by the head of the Government smacked of irresponsibility, an offensive attitude in breach of the constitutional authority of office and a grave danger to the solidarity, integrity and sovereignty of the State of Pakistan.
The learned Attorney-General submitted that the Army as an institution has refused to accept the illegal and unconstitutional orders, which were directed towards undermining the unity of the Army and the integrity of the country as such. Referring to the submission made by Mr. Khalid Anwar on behalf of the petitioners that no matter what happened on the 12th October, the elected representatives could not be displaced, the learned Attorney-General contended that the mandate given by the people is couched in sacred, but limited language, which does not extend to the annihilation of the Army command and the action of the former Prime Minister, it is public perception, appeared to be an act of enemy because in a war, the first lesson of strategy for the enemy is to strike at the effectiveness of the command and disturb it. He submitted that there are certain norms of dealing with a friend, dealing with their own Commander-?in-Chief and dealing with the enemy. According to him, the former Government headed by the former Prime Minister adopted a course as if the Chief of Army Staff, representing an Army of 600,000 men, who had taken oath to defend this country as a united force, was an enemy of Pakistan.
The learned Attorney-General contended that such an assumption is not only preposterous, it needs to be disapproved in the strongest possible language by every Pakistani, particularly the apex Court.
(In the name of Allah, the most Beneficent, the most Merciful)
I,__________________, do solemnly swear that I am a Muslim and believe in the Unity and Oneness of Almighty Allah, the Books of Allah, the Holy Qur'an being the last of them, the Prophethood of Muhammad (peace be upon him) as the last of the Prophets and that there can be no Prophet after him, the Day of judgment, and all the requirements and teachings of the Holy Qur'an and Suntah.
That I will bear true faith and allegiance to Pakistan:
That, as the Prime Minister of Pakistan, I will discharge my duties, and perform my functions, honestly, to the best of my ability, faithfully in accordance with the Constitution of the Islamic Republic of Pakistan and the law, and always in the interest of the sovereignty, integrity, solidarity, well-being and prosperity of Pakistan:
That I will strive to preserve the Islamic Ideology which is the basis for the creation of Pakistan:
That I will not allow my personal interest to influence my official conduct or my official decisions:
That I will preserve, protect and defend the constitution of the Islamic Republic of Pakistan:
That, in all circumstances, I will do right to all manner of people, according to law, without fear or favour, affection or ill-will:
And that I will not directly or indirectly communicate or reveal to any person any matter which shall be brought under my consideration or shall become known to me as Prime Minister, except as may be required for the due discharge of my duties as prime Minister.
[May Allah Almighty help and guide me (A'meen).]"
According to the learned Attorney-General, the words, "sovereignty, integrity, solidarity, prosperity and well being", embody the essence of the Constitution and are the touchstone and the test before this Court for judging the actions of the former government, particularly the then Prime Minister. He contended that the actions of the former Government were not in conformity with the maintenance of sovereignty, integrity, well being and prosperity of Pakistan because when the Chief of Army Staff was attempted to be handed over to another country and he was exposed to physical elimination, it was not safeguarding the sovereignty of Pakistan. Further, when the former Prime Minister exposed the Armed Forces to dissension and disintegration, it was not maintenance of the sovereignty or safeguarding the sovereignty, rather the sovereignty and integrity of the country were seriously endangered because it is the only institution, which is capable of safeguarding the integrity of Pakistan. The learned Attorney-General stated that the well being of the people is a reflection of the combined effect of sovereignty, integrity and solidarity and there can be no well being of the people without sovereignty, integrity, solidarity and prosperity. Likewise, prosperity again embodies all these ingredients and also extends to the economic prosperity of the people. According to him, all these tests when applied to the former Government and the former Prime Minister, turn out in the negative and to a long way in disqualifying him under Article 63 from being either a member of the Parliament or incharge of the affairs of the State. Reference was also made to Article 63 of the Constitution, which reads thus:
63.?????? (1) A person shall be disqualified from being elected or chosen as, and from being, a member of the Majlis-e-Shoora (Parliament), if-
(a)??????? he is of unsound mind and has been so declared by a competent Court; or
(b)??????? he is an undischarged insolvent; or
(c)??????? he ceases to be a citizen of Pakistan, or acquires the citizenship of a foreign State; or
(d)??????? he holds an office of profit in the service of Pakistan other than an office declared by law not to disqualify its holder; or
(e)??????? he is in the service of any statutory body or anybody which is owned or controlled by the Government or in which the Government has a controlling share or interest; or
(f)???????? being a citizen of Pakistan by virtue of section 14-B of the Pakistan Citizenship Act, 1951 (II of 1951'), he is for the time being disqualified under any law in force in Azad Jammu and Kashmir from being elected as a member of the Legislative Assembly of Azad Jammu and Kashmir; or
(g)??????? he is propagating any opinion, or acting in any manner, prejudicial to the Ideology of Pakistan, or the sovereignty, integrity or security of Pakistan, or morality, or the maintenance of public order, or the integrity or independence of the judiciary of Pakistan, or which defames or brings into ridicule the judiciary or the Armed Forces of Pakistan; or
(h)??????? he has been, on conviction for any offence which in the opinion of the Chief Election Commissioner involves moral turpitude, sentenced to imprisonment for a term of not less than two years, unless a period of five years has elapsed since his dismissal; or
(i)???????? he has been dismissed from the service of Pakistan on the ground of misconduct, unless a period of five years has elapsed since his dismissal; or
(j)???????? he has been removed or compulsorily retired from the services of Pakistan on the ground of misconduct unless a period of three years has elapsed since his removal or compulsory retirement; or
(k)??????? he has been in the service of Pakistan or of any statutory body or anybody which is owned or controlled by the Government or in which the Government has a controlling share or interest, unless a period of two years has elapsed since he ceased to be in such service; or
(1)??????? he is found guilty of a corrupt or illegal practice under any law for the time being in force, unless a period of five years has elapsed from the date of such conviction; or
(m) he has been convicted under section 7 of the Political Parties Act, 1952 (III of 1962), unless a period of five years has elapsed from the date of such conviction; or
(n) he, whether by himself or by any person or body of persons in trust 'for him or for his benefit or on his account or as a member of a Hindu undivided family, has any share or interest in a contract, not being a contract between a cooperative society and Government, for the supply of goods to, or for the execution of any contract or for the performance of any service undertaken by, Government:
Provided that the disqualification under this paragraph shall not apply to a person-
(i)???????? where the share or interest in the contract devolves on him by inheritance or succession or as a legatee, executor or administrator, until the expiration of six months after it has no devolved on him;
(ii)??????? where the contract has been entered into by or on behalf of a public company as defined in the Companies Ordinance, 1984 (XLVII of 1984), of which he is a shareholder but is not a director holding an office of profit under the company; or
(iii)?????? Where he is a member of a Hindu undivided family and the contract has been entered into by any other member of that family in the course of carrying on a separate business in which he has .no share or interest; or
Explanation.-In this Article "goods" does not include agricultural produce or commodity grown or produced by him or such goods as he is, under any directive of Government or any law for the time being in force, under a duty or obligation to supply
(o)??????? he holds any office of profit in the service of Pakistan other than the following offices, namely:-
(i)???????? an office which is not whole time office remunerated either by salary or by fee;
(ii)??????? the office of Lumberdar, whether called by this or any other title;
(iii)?????? the Qaumi Razakars;
(iv)?????? any office the holder whereof, by virtue of such office, is liable to be called up for military training or military service under any law providing for the Constitution or raising of a Force; or
(p)??????? he is for the time being disqualified from being elected or chosen as a member of the Majlis-e-Shoora (Parliament) or of a Provincial Assembly under any law for the time being in force.
(2)??????? If any question arises whether a member of the Majlis-e-Shoora (Parliament) has become disqualified from being a member, the Speaker or, as the case may be, the Chairman shall refer the question to the Chief Election Commissioner and, if the Chief Election Commissioner is of the opinion that the member has become disqualified, he shall cease to be a member and his seat shall become vacant."
The learned Attorney-General vehemently contended that according to the record almost 80% of the actions of the former Government were directed towards self-aggrandizement and furtherance of personal interest and were taken for the purpose of amassing wealth by unlawful means. Thus, the Constitution was violated in letter and spirit on a wide scale, almost rendering it illusory and inoperative; democracy was throttled out and instead dictatorship was sought to be established.
The, learned Attorney-General next argued that a reign of victimization of political opponents, whether they belonged to party A, B, or C, was let loose with a view to perpetuating power. He contended that the conduct of the petitioners in juxtaposition with the contents of the oath of office of the Speaker of the National Assembly, Federal Ministers and the members of the Senate, which are almost identical, does not entitle them to the reliefs claimed by them in these petitions, inasmuch as they had taken oath to act in the interest of sovereignty, integrity, solidarity, well being and prosperity of Pakistan, which they did not. Moreover, when they owe their existence and allegiance to a political party and when they even today say that Mian Nawaz Sharif whose conduct has been described above, is still their. leader and they have not publicly disowned him or disassociated from him, all of them have acted jointly and have, thus, disentitled themselves in law and under the Constitution to the reliefs they have prayed for in these petitions.
Commenting on the conduct of the former government, the learned Attorney-General further submitted that the 13th Amendment was got passed within 13 minutes. He submitted that the 8th Amendment including Article 58(2)(b) was passed by consensus by an elected body in 1985. A debate had taken place in the National Assembly and the Senate, which deliberated for 40 days. There were committees, sub-committees and experts and members elected from various parties and members forming independent groups of opposition led by Haji Saifullah Khan, who negotiated every word of it, who disputed every word of it and after having considered every word proposed by the Government party, they themselves agreed on the phraseology of Article 58(2)(b) having checks and balances, which was a product of divergent opinions ultimately resulting in a consensus and that was true spirit of democracy. Article 58(2)(b) stood the test of time for 10 years and there was no Martial Law. The only result of Article 58(2)(b) was repeated appeal to the political sovereign i.e. the electorates from holding general elections within 90 days.
The learned Attorney-General then formulated his submissions in writing which are as under:-
(1)??????? That in the facts and circumstances prevailing on 12th October, 1999 and prior thereto the taking over of the governance by the Armed Forces was valid, legitimate, bona fide and unavoidable to save the State and its institutions and is justified by the Doctrine of State Necessity.
(2) That the legitimacy of the Proclamation, dated 14th October, 1999, the various Provisional Constitutional Orders and all actions pursuant thereto derived their own legality from the Doctrine of State Necessity and State survival. Further, the fact that no remedy was available under the prevailing legal order including the Constitution, intervention was unavoidable and necessary for the preservation of the State.
(3)??????? Such course of action by the Armed Forces is approved in Begum Nusrat Bhutto's case, by a full Bench of this Hon'ble Court. The facts of the present case are far more serious .to justify the application of Doctrine of Necessity inasmuch as, the main protective institution of the State against external aggression and internal disturbances i.e. the Armed Forces of Pakistan was exposed to internal disunity, division and dislocation of military command by the former Government. The only point involved in Begum Nusrat Bhutto's case was rigging of elections and civil disobedience while in the present case, it is a matter of State survival.
(4)??????? That the deposed Prime Minister and his partymen, having grossly violated their Oath of office as is evident from the events of 12th October. 1999 and prior thereto, the Armed Forces of Pakistan under the provisions of the Constitution of Islamic Republic of Pakistan. 1973 and by virtue of their oath of office, were under a sacred duty and legal obligation to save the country from internal subversion which -is self-evident from the events of 12th October, 1999, as adjudged by the judgment, dated 6th April, 2000 pronounced by the Anti-Terrorist Court at Karachi and other facts on the record. In the face of these events intervention by the Armed Forces was necessary and natural. ???
(5)??????? Where there exists reasonable basis for concluding that existence of the State and its sovereignty is at stake, the Courts will not substitute their own judgment for that of the Armed Forces/Executive which acted under the compelling necessity of saving the State and its sovereignty. Thus, the Proclamation dated 14th October, 1999 was issued pursuant to deliberations and discussions of the Corps Commanders of the Armed Forces and the three Service Chiefs of the Army, the Air force and the Navy. All legal ,instruments, laws and orders issued thereunder such as the Provisional Constitutional Orders are valid, proper and bona fide. All actions taken thereunder are also legal and valid. Thus, the Proclamation and all other legal instruments were not the individual acts of one person having been issued in the best interest of saving the country. The bona fides of all its authors, i.e. the entire Armed Forces cannot be questioned.
(6)??????? The source of power and validity of the Proclamation of Emergency is to be determined by consideration of the total milieu in which the change is brought about, namely, the objective situation obtaining at the time in relation to the break down of constitutional machinery for the change and the paramount Necessity for the preservation of the State and its organs. It is such destruction which justifies the taking over of the country by the Armed Forces in order to save total destruction and extinction of the State and the Executive, Legislative and Judicial institutions of the country including undermining the unity and discipline of Armed Forces all of which occurred on account of the action of the former Government.
(7)??????? That in the present case, after taking a comprehensive view of all the facts necessitating the Proclamation, it is submitted that the same is fully justified on the doctrine of Necessity and it is not amenable to judicial review.
(8)??????? That what is described and understood as State Necessity is nothing more than an extension of Doctrine of Necessity as recognised by jurisprudence. In the political sense, Doctrine of State Necessity has direct nexus with the situation necessitating such abrupt political change and has its validity/justification thereunder. It would, therefore, follow that the Doctrine of State Necessity justified the existence of the present legal order and the exercise of power thereunder which is for the preservation of the country. The reference to the so-called theory of Divine Right of Kings by the Petitioners who were privy to the former Government is wholly irrelevant and preposterous. In fact the petitioners. were active participants and supporters of the former Government in their illegal actions. They never objected to the same, including the events of 12th October.
(9)??????? The Doctrine of Necessity is embedded in ancient as well as contemporary Jurisprudence. According to this an act which would otherwise be illegal becomes legal under the stress of Necessity, and in the context of governance is referable to an intention to preserve the "State or Society, even by extra-Constitutional or meta-legal acts."
(10)????? That the Doctrine of Necessity is a recognised principle of Islamic Jurisprudence and applies equally to individual and collective perception of social behaviour.
(11) That the term "Necessity" does not have a fixed character. It is relative and elastic rather than absolute. It has various degrees and meanings and may connote different measures of Necessity and it should be construed with reference to existing conditions. Necessity has been held to be synonymous or equivalent to Emergency. (Corpus Juris Secundum Vol. 65, pp. 115, 116, 118)
(12) That once the assumption of extra-Constitutional Power is held to be valid, the legality of actions taken by such authority is to be judged in the light of principles pertaining to the Law of Necessity. (Begum Nusrat Bhutto's case, p. 657).
(13)????? That it is not correct to limit the doctrine of Necessity only as a defence to a criminal prosecution referable to self-defence or defence in Torts. (Corpus Juris Secundum, Vol. 65, p 387).
(14) That once it is found that the prevailing situation did warrant an abrupt change and there was no remedy available under the prevailing Legal Order, the persons responsible for the change are fully competent to bring about such change in law, including the Constitution, which intends to correct the flawed Old Legal Order for preservation of the State as well as welfare of the people. (Begum Nusrat Bhutto's case, p.657).
(15) That the revolutionary political change is not in derogation of the Objectives Resolution under Article 2A of the Constitution, as ultimately the method of governance shall be through chosen representatives of the people. The process. and mode of Devolution of Power has already been declared which shall guarantee true representation as against the hithertofore sham democracy. (Speech of the Chief Executive dated 17-10-1999).
(16) That International Law recognises the right of the people to alter by any means, including force, the form of Government under which they live. Accordingly if the Government is in effective control and without any effective opposition particularly when the previous Government has ceased to exist, the efficacy or effectualness of the change has moral as well as legitimate justification. (Sorensen pp.271,272)
(17) That the principle of proportionality is not attracted in case an abrupt political change becomes absolutely necessary, as in this case, and displaces the Old Legal Order for valid reason and the previous Government ceases to exist. In fact the situation demands a complete change of the old, decadent and destructive structure.
(18) That the circumstances necessitating the political change in Begum Nusrat Bhutto's case PLD 1977 SC 657 though similar for application of the Doctrine of Necessity the situation prevailing in the present case is far more serious and appropriate for application of the Doctrine of Necessity which rendered the political change inevitable inasmuch as:
(i)???????? Failure of Law and Order situation in 1977 was similar as described in PLD 1977 SC 657 at 693 to 703. Law and Order situation was worse in the present case as is in PLD 1997 SC 426 at 465 para.40 (pages 465 to 469, paras.40-42), and PLD 1999 SC 504 at 709-733, as well as the recent Judgment of the Anti-Terrorist Court, Karachi delivered on 6th April, 2000.
(ii)??????? That the General Elections of 1977 were found in Begum Nusrat Bhutto's case to be the result of massive and wholesale rigging and thus, the then Prime Minister was held to 'be a usurper. In the present case the former regime has committed such acts by virtue of which the powers of all the different organs of the State were usurped by the former regime with the intention of concentrating power in the single person of the ousted Prime Minster.
(iii)?????? The so-called heavy mandate was illusory and a farce and the Assemblies were rubber stamp of one man rule. The so-called heavy mandate consisted of votes not exceeding 12 to 13 % including bogus votes.
(iv)?????? By the 13th Amendment the former Prime Minister arbitrarily repealed Article 58(2)(b) which empowered the President to dissolve the Government for failure of Government machinery and by the same amendment repealed the power of the President to act in his discretion in the appointment of Chiefs of the Armed Forces. All this was done without discussion in the Parliament with the result that no check and balance was left on the action of the Prime Minister and his chosen few in the Parliament, while they plundered national wealth and amassed personal wealth by creating bank defaults of Rs. 1215 billion, indulged in acts of corruption and corrupt practices and destroyed national economy. Thus, he became a despot using State apparatus for personal gain.
(v)??????? By the 13th Amendment he managed to concentrate all power in his hands. The Anti-Defection Law passed without allowing a debate in the Parliament empowered him to expel any member of the Parliament who disagreed with him. Thus, the Government of the former Prime Minister throttled freedom of speech, freedom of action and freedom of vote of the legislators only for assuming dictatorial powers. All these measures resulted in negation of democracy as contemplated by the various provisions of the Constitution including Article 2A, the Preamble and Fundamental Rights and destruction of all democratic norms. All these actions are alien to the Parliamentary democracy which guaranteed freedom of expression and other Fundamental Rights of equality before law, protection of life, liberty and property etc.???
(vi)?????? The cumulative effect of all these actions of the former Government was betrayal of oath of office of the Prime Minister, the various Ministers and the Parliamentarians, Members of the Provincial Assemblies, all of whom lost thereby the moral and legal authority to govern.
(vii) That the judgment passed in Begum Nusrat Bhutto's case has been considered minutely in Mehmood Achakzai's case and it has been held (para.45-PLD 1997 SC 426) that no exception can be taken to `ratio decidendi' laid down in the judgment of Begum Nusrat Bhutto's case, whereunder the Full Court dismissed the petition as not maintainable.
(19)????? The result of despotic rule was total destruction of economy, mass violation of fundamental rights, political victimization, tapping of several hundred telephones of political rivals, ridiculing of superior judiciary, storming of the Supreme Court, appointment of political favourites as Judges and massive corruption in the various agencies of the Government. (see paper books attached and particularly the list of references filed by NAB and the bank statements issued by the State Bank of Pakistan etc. as stated therein Reference is also made to Vol. A, B and C filed by Mr. Syed Sharifuddin Pirzada, Sr. ASC for the Federation).
(20) That the former Government arid their functionaries as well as Members of the Parliament scandalized, harassed and humiliated the Superior Judiciary in public which was reflected in (i) TV programmes against the verdict of Supreme Court in the case of Military Courts (ii) speeches of the former Prime Minister against the Judiciary. (P.B. Volume IX, at pages 135, 204-228, 227-243) (iii) speeches in the Senate and the National Assembly/Provincial Assembly. The storming of the Supreme Court by and at the instance of the former ruling party including elected representatives and judgment therein by the Hon'ble Supreme Court establishes gross Contempt of Court, which shows total ridiculing and undermining the apex Court.
(21)????? Former Speaker of the National Assembly and the Chairman of the Senate of Pakistan were in League with the Government, as no reference was made to the Chief Election Commissioner for disqualification of any Member of the Government in terms of Article 63(2). (P.B. Volume-VII, pages 76-79 - Reference of Mr. Muhir Ahmad Khan (Volume-IX, pages 229, 230, 231.
(22)????? Tapping of the telephones including those of the Judges and officials of the Supreme Court, despite judgment of the Benazir Bhutto's case holding it to be unconstitutional and illegal (Volume?VIII, page 59).
(23)????? The former Prime Minister made active attempts to create ,dissension to divide the Army. Further, dangers of such dissension are apparent from the facts disclosed and judgment given by the Anti-Terrorist Court at Karachi. Further, facts as disclosed show unconstitutional attempt at removal of the Chief of the Army Staff at a time when he was away from Pakistan on official duty and in the air at the height of 25000 feet. The Court at Karachi has found the former Prime Minister guilty of the offences of hijacking and terrorism. The offences of which the former Prime Minister has been convicted include section 402(b) of the Penal Code and section 7 of the Anti-Terrorists Act. It is most significant and serious among other facts disclosed by the Chief of the Army Staff, ?his speech of October 17, 1999 (p.39 of Vo1.1 - Written Statement), when he stated that circumstances were created which would have forced his plane either to land in India or crash (p.79 of C.P. 63 of 1999).
(24)????? The former Government actively tried to create a parallel command which the Army has refused to accept. Former Chief of the Army Staff, General Jehangir Karamat, a celebrated soldier was removed for making constructive suggestion for formulation of National Security Council and so was the removal of the Chief of the Air Staff, Air-Marshal Abbas Khattak for concentrating power in the hands of the former Prime Minister.
(25)????? Hijacking was culmination of various incidents and in any case apart from any other factors, the Army takeover was justified on the following grounds:-
(a)??????? Humiliation of the Judiciary.
(b)??????? Dissension created in the Army and potentially rendering its command ineffective and forcing the COAS to be handed over to India and exposing him to certain death.
(c)??????? Destruction of the democratic set-up, Parliament and the Provincial Assemblies.
(d)??????? The Parliament and the Provincial Assemblies cannot be restored on the following grounds:-
(i)???????? Large scale corruption of the Parliamentarians, who have not even paid charges for boarding and \lodging besides being Bank defaulters.
(ii)??????? References filed against Parliamentarians for misconduct and Bank defaults before Accountability Court.
(iii)?????? The abatement and ridicule of the Judiciary and storming of the Supreme Court and discrediting the Army by the former Parliamentarians.
(e)??????? No fresh elections can be held without updating the electoral rolls. As per report of the Chief Election Commissioner, this process will take two years.
(f)???????? The process of accountability will be carried out to combat corruption. Already 79 references are pending and more than 200 are on the way.
(g)??????? Reforms are needed to be carried out.
(h)??????? The economy is to be revived and steps are to be taken for the purpose of welfare of the people.
(i)???????? Reforms are to be undertaken keeping in mind the state of resources, requirements of the people and defence of the country.
(j)???????? Government has already taken various steps for reform, including conservation of foreign exchange and recovery of Bank defaults. Already over Rs. 11 Billion have been recovered after 12th October from defaulters and the process of revival of economy continues."
The learned Attorney-General submitted that Proclamation of Emergency, dated 12th October, 1999 is of a different character from the one issued by General Yahya Khan, inasmuch as, this time it has been approved unanimously after due deliberations by all the Corps Commanders who represent the whole Army, and there was imminent danger to the very survival of the State, which perception they clearly realised and decided to confront it.
The learned Attorney-General, then presented a list giving the cases of corruption, loan defaulters etc., which reads thus: -
CORRUPTION
Description
Statement of Governor, State Bank that the defaulters owe 356 billions rupees.
Two cases against former Prime Minister sent to NAB.
26 Top defaulters held.
List of 39 references pending against Mian Nawaz Sharif.?????????
List of 40 references pending against Mian Nawaz Sharif.
Transcript of BBC Television documentary on corruption in Pakistan.
Summary of Reference filed against Mian Nawaz Sharif and others.
Order dated 5-I1-1999 passed by High Court of Justice Queen's Bench Division England in Al-Towfeek Company v. Hudaibiya Paper Mills.
Statement of Shezi Nackvi Director AI-Towfeek Company.
Documents annexed to statement of Shezi Nackvi.
Judgement dated 16-3-1999 of Queen's Bench Division in Al?Towfeek Company v. Hudaibiya Paper Mills.
11 Billion Dollars in Pakistan Banks were removed without consent of Accounts Holders FEBC accounts were frozen and foreign exchange misappropriated, huge sums removed by former Prime Minister even after the freeze.
Former Prime Minister and family established Sugar Mills in Kenya purchased four flats in London.
Building of vast Raiwind Estate - Misuse of Government money for construction of road to Raiwind and declaration of Raiwind House as official residence of P.M. - maintenance at the expense of Pak PWD.
Contracts for transportation of wheat, yellow cab Scheme, construction of Motorway kick backs and commissions.
Money Laundering through traveller cheques, dollar bearer certificates, overseas accounts and purchase of property in London.
Copy of F.I.R. No.12 of 1994 against Directors of Hudaibiya Engineering regarding opening of fictitious accounts.
Copy of F. I. R. No. 13 of 1994.
Press Clippings of Foreign press.
Internet reports of Daily Dawn.
Brief of Finance Division.'
Properties relating to District Lahore (Raiwind).
Reference application by Munir Ahmad Khan, Allama Iqbal Town to Chief Ehtesab Commissioner Islamabad against former Prime Minister, Chief Minister and others regarding misusing the official resources and causing loss to the National Exchequer to the tune of Rs.620 million.
List of properties in Lahore District.
Raiwind.
Sheikhupura District
Kasur
Rawalpindi District
Murree
Letter from D.C., Vehari to Deputy Secretary to Chief Secretary Punjab regarding ownership of 111 Kanals, 19 Marlas near Sahib Ali of Sharif's family.
Land in the name of Industries owned by Mian Nawaz Sharif and family in District Lahore and Kasur.
Grand total of land properties in the name of Nawaz Sharif and his relatives
Land purchased by Mian Nawaz Sharif and family owner wise categorization in District Sheikhupura, Lahore, Kasur, Rawalpindi, Murree, Vehari.
White paper on Mian Nawaz Sharif Family's corruption etc.
Extraction of. money from banks/DFIs by Mian Nawaz Sharif, Shehbaz Sharif and other members of Shehbaz Sharif family with Annexures A, B, C and D.
Details of history of business of Sharif family viz. Ittefaq Foundry etc.
Outstanding liabilities against Ittefaq Group - Annexure-"A".
Properties owned by infamous Ittefaq Foundry as it stood on 20th March, 1990, Annexure "B".
Ittefaq (Accounts Department) Annexure "E".
Documents relating to bid price. Lahore and Islamabad Motorway, 27-11-1991.
Income Tax Statement regarding Mian Nawaz Sharif released by the Interior Minister.
Estimate of Lahore Islamabad Motorway given by National Highway Authority Project Management Cell, 18-11-1991
Office Note by Additional Director Industries, Directorate of Industries and Mineral Development Punjab, Lahore with regard to setting up of an Industrial Estate in 41 Villages Tehsil Chunian covering 60466 acres of Land, 6-3-2000.
Punjab Gazette Notification issued by Collector Kasur with regard to acquisition of land for Industrial Estate in Tehsil Chunian with detail of Khasra Nos. in various villages, 25-3-1987.
Notification from Ministry of Finance, Government of Pakistan regarding amendment in the Original Notification? (25-3-1987) with map showing Tax Free Zone, 26-5-1987.
Letter dated 7th January, 1998 from PM Secretariat declaring House at Raiwind Farm as official residence of the Prime Minister.
CORRUPT PRACTICES IN RESPECT OF DEPOSIT
OF HUGE SUMS OF MONEY TO SPEND
UPON ELECTIONS
Affidavit of (R) General Nasirullah Babar filed in this Court in HRC No. 19 of 1996 with index.
List of amounts deposited in Accounts of various Banks of Pakistan by a representative of Mr. Younus Habib
Detail of total amount of Rs.14 crore deposited by a Representative of Mr. Younus Habib (from 10-9-1990 to 22-10-1990).
List of names of 14 politicians and the amounts deposited in their names with lit of amount transferred to HQ. 313 Survey and Constructions Rwp.
Statement of Accounts No. 1726.
Affidavit of Lt. Gen. (Retd.) M. Asad Durrani in HRC 19 of 1996 regarding providing logistic support to the disbursement of donations campaign of UI in the four provinces, 24-7-1994.
Affidavit of Lt. Gen. (Retd.) M. Asad Durrani in HRC No. 19. of 1996 as to press release issued on behalf of Gen. (R) Mirza Aslam Baig that Mr. Younus Habib and his community had donated rupees one hundred forty million and deposited this amount in a Government Agency.
FAILURE OF LAW AND ORDER SITUATION
Details of extra-judicial killings in Punjab.
Details of extra-judicial killings, dacoities, high profile killings, loot and arson etc. in Sindh. Mehmood Achhakzai's case.
FAILURE OF LEGISLATIVE ORGAN
Promulgation/re-promulgation or ordinances by the previous Government.
13th Amendment in the Constitution of Pakistan, 1973 - powers of the President under Article 58(2)(b) withdrawn - similar powers of the Governor under Article 112(2) also taken away discretionary power of the President to appoint Governors made subject to advice of Prime Minister the discretion of the President to appoint Chairman, Joint Chiefs of Staff Committee has been taken away.
14th Amendment-provides for defection if MNA or MPA votes contrary to any direction issued by the Parliamentary Party to which he belongs. This amendment takes away the right of freedom of speech.
The 15th Amendment bill published in Gazette of Pakistan Extraordinary on 1-9-1998 contemplates to give unbridled power to the executive as against the legislature.
16th Amendment bill published in the Gazette of Pakistan Extraordinary dated 17-11-1998 also proposed to confer unlimited power upon the Executive as against the legislature.
FAILURE OF JUDICIAL ORGAN OF THE STATE
Unwanted confrontation with the Judges of the Superior Courts, National Assembly Proceedings/debates ridiculing Judiciary.
Senate proceedings/debates ridiculing Judiciary.
The infamous storming of the Supreme Court to prevent the apex Court from proceeding in contempt petition against the former PM in Criminal Original No.29 of 1997.
The President and the Chief Justice of Pakistan resigned on 2-12-1997 which was justified in the Assembly.
Ridiculing of judiciary is a valid ground for dissolution of the Government as stated in PLD 1998 SC 388 (at page 431).
Failure of the Executive/Bureaucracy
PLOT TO DIVIDE ARMED FORCES
Interview of the Chief Executive with APP throwing light on the 12th October drama at Karachi Airport.
Article by Akhtar Isphahani published in Newsline of October, 1999, titled "What happened in Flight PK-805".
Article by Kamran Khan of News Intelligence Unit, published in the daily News dated 14-10-1999, titled "Ambitious Ziauddin steered Nawaz to political disaster."
Article by Kamran Khan of News Intelligence Unit, published in the Daily News dated 14-10-1999, titled "Ambitious Ziauddin steered Nawaz to political disaster."
Statement of Allama Tahirul Qadri published in Asas Rawalpindi dated 13-10-1999 titled "On seeing dissension in Army, India was going to open attack on Pakistan".
News item published in daily Khabrain dated 13-10-1999, with the title "Plan of Rana Maqbool, I.-G. Sindh failed - Gen. Pervaiz Musharraf could not be arrested".
OBJECTIVES OF MILITARY TAKE OVER.
First speech of General Pervaiz Musharraf
Statement of General Pervaiz Musharraf that restoration of democracy is the top priority.
Statement of General Pervaiz Musharraf about setting up of National Security Council.
Announcement of the Chief Executive about accountability welcomed by B.N.P Mengal, J.U.I. Fazalur Rehman and Awami National Party.
Council of Islamic Ideology endorsed Chief Executive's agenda
Chief Executive briefed Sheikh Zayed Bin Sultan Al-Nahyan of UAE.
Chief Executive pledged civilian rule after reforms
National Accountability Bureau set-up.
Chief Executive promised maximum autonomy at district level
Statement of the Chief Executive that improving economy and ruthless accountability are his two major objectives.
Statement of the Chief Executive that improving economy and ruthless accountability are his two major objectives.
Civil and Military combine to manage affairs
Chief Executive emphasised formulation of policies to give relief to common man.
Chief Executive emphasised formulation of policies !3 give relief to common man.
Cover story by Zahid Hussain published in Newsline of October, 1999 titled "Day of the General" explaining circumstances under which the Army was, once again, compelled to intervene in the country's chequered democratic history.
Press clipping from the daily "News" dated 31-10-1999 with the title "Gentlemen and Officers".
Radio Monitoring Report of BBC dated 15-10-1999, interview with Ghulam Sarwar Cheema, former Defence Minister saying that Army has no intention to impose Martial Law.
News item published in the daily Pakistan dated 20-10-1999, about the interview of Mr. Niaz A. Naik, former Foreign Secretary, with BBC.
PUBLIC PERCEPTION/ WELCOME/ ACCEPTANCE
Cartoon from A.K. Sajjad Painter "Donkeys pondering ways to plunder Pakistan"
Mrs. Benazir Bhutto welcomed the bold Proclamation of the Chief Executive
Leaders hail Chief Executive's address to the Nation. Statement of the President of Hyderabad Chamber of Commerce and Industry that the Military action saved country from destruction.
Leaders demand change in system.
Statement of Mr. Ghulam Mustafa Jatoi, NPP Chief that Army action was inevitable.
Chief Executive to visit and brief Saudi and UAE Rulers about Afghanistan.
Statement of Rasool Bux Palijo, Awami Tehrik Chief that all Provinces should be treated as equal.
King Fahad of Saudi Arabia hoped that the Armed Forces will preserve stability and strength of Pakistan.
Chief Executive satisfied with Saudi support Chief Executive assured of Saudi Arabia's support.
Muttahida Qaumi Movement assured the Chief Executive of its co?operation.
Ijazul Haq declared that 7 point agenda of the Chief Executive is reflective of national aspirations.
Sindh Taraqqi Pasand Party declared that military take-over is logical outcome of dictatorship.
Chief Executive discussed relations with Amir of Qatar and addressed Pakistani community.
Article by Nasim Zehra of Gulf News based in Islamabad, published in the Gulf News dated 14-10-1999, with the title "No time for rejoicing now". Also a picture showing people in Lahore city celebrating Nawaz Sharif's dismissal with fireworks.
Article by Rehmat Shah Afridi, published in Frontier Post Peshawar on 17-10-1999, with the title "No coup d'etat, but coup de grace.
Article by Shafqat Mahmood, published in daily News Islamabad dated 16-10-1999, titled "A bitter harvest and new beginning."
News item published in daily Nation Islamabad dated 14-10-1999, regarding Army take-over, Mian Azhar backing Army action, Imran Khan's stinging attack on dictator Nawaz, and Benazir urging military to set-up care-taker Government.
News item published in daily News Islamabad and Frontier Post Peshawar, dated 14-10-1999, titled "Qazi Hussain Ahmed welcomes Nawaz's ouster, demands elections' and "salute to army"
Article by Miangul Naeem of Peshawar, published in daily Nation dated 14-10-1999, titled "Dismissal of Nawaz Government welcomed".
Statement of Imran Khan issued from London, published in the daily Dawn Karachi dated 14-10-1999, with the title "Army stops Nawaz from becoming dictator".
Statement of the Deputy Secretary General of Sipah-e-Sihaba published in the daily Nawa-e-Waqt to the effect that the Army Chief has saved the country from internal civil war by taking action at right time.
Statement of Ijazul Haq, Senior Vice-President of PML(N) published in daily Nation dated 15-10-1999, to the effect that Army was left with no other option.
Statement of the President of Pakistan Tehrik-e-Insaf Peshawar District, published in the daily Frontier Post terming military action as timely.
News item published in the daily News, Islamabad, dated 15-10-1999, with the title "75% people back army action: Gallup Poll".
News item published in the daily News. Islamabad dated ' 15-10-1999, with the title "Peshawar, Lahore Bars back Nawaz removal".
Radio Monitoring Report of BBC dated 15-10-1999 - Maleeha Lodhi on Army Coup, News item published in the daily Nation Islamabad dated 15-10-1999, titled "Chishti [General (Retd.) Faiz Ali] endorses army action."
News item published in daily Pak. Observer Islamabad dated 15-10-1999, containing statement of Gen. (Retd.) Hamid Gul, lauding Army action.
News item published in daily Jang Rawalpindi dated 15-10-1999, about supporting of Army action by the Peshawar and Lahore High Court, Bar Associations.
Statement of Ijazul Haq published in daily Jang Rawalpindi dated 15-10-1999, with the title "Removal of Nawaz Government was necessary - Nation is with the Army".
News item published in daily News Islamabad dated 16-10-1999, with the title "Politicians continue to hail Nawaz's ouster".
Radio Monitoring Report of BBC dated 17-10-1999, titled "Ordinary people accept coup in Pakistan."
News item published in daily Nation Islamabad dated 16-10-1999, with the title "Army action welcomed."
News item published in daily Frontier Post Peshawar dated 16-10-1999, with the title "Full support to Army".
Statement of Habib Wahabul Khairi published in daily Din Rawalpindi dated 16-10-1999, to the effect that Nawaz Sharit committed the offence of high treason and Proclamation of Emergency is a democratic action.
News item published in daily Pak. Observer Islamabad dated 19-10-1999, with the title "PPP to extend silent support to Musharraf."
Statement of Ghulam Sarwar Cheema, former Defence Minister and MNA of PML(N) published in daily Nation Islamabad, dated 19-10-1999, with the title "Army action was inevitable".
Statement of Ijazul Haq published in daily Khabrain Islamabad dated 18-10-1999, to the effect that if Nawaz Government had continued, the country would have faced grave crisis.
News item published in daily Nation, Islamabad dated 18-10-1999 with the title "seven political parties, groups support military action".
Radio Monitoring Report of BBC dated 18-10-1999 titled "Proclamation of Emergency welcomed".
Decision of Grand Democratic Alliance that "people are not with us but are with the Chief Executive - No party included in GDA will issue any statement against the present set-up".
Statement of Ghulam Mustafa Jatoi; Chief of the National People's Party that Army action was inevitable.
Statement' of Prof. Abdul Ghafoor of Jamat-e-Islami published in the Dawn Karachi, dated 21-10-1999, that Military take-over saved institutions.
Article by Nazar Ali Suhail published in daily News Islamabad dated 21-10-199, with the title "Public welcomes Musharaf's agenda."
News item published in daily news Islamabad dated 21-10-1999, with the title "G.D.A. supports Musharraf's agenda - Demands restoration of true democracy."
Publication of the United Farmers Association Pakistan published in daily Nawa-e-Waqt, Islamabad dated 25-10-1999, with the title "Army and Peasants are one."
Picture published in daily News dated 30-10-1999 showing the people dancing- in front of a huge hoarding of Gen. Pervaiz Musharraf.
Statement of Kabir Wasti of Muslim League (Qasim) published in Jang Rawalpindi dated 13-12-1999 to the effect that Army has taken-over to defend-Federation.
Statement of Hamid Nasir Chatha published in News Islamabad. dated 1-11-1999 that 90% people support Musharraf.
Statement of Aftab Ahmed Khan Sherpao of PPP published in News Islamabad dated 2911-1999 that Army enjoys popular support.
News item published in Pak. Observer Islamabad dated 5-12-1999 with the title "ANP declares full support to C.E.
News item published in Pak. Observer Islamabad dated 13-I0-1999 to the effect that Allama Tahirul Qadri backs Army take-over.
News item published in Pak. Observer dated 13-10-1999 with the title "People welcome take-over, demand accountability".
News item published in News Islamabad dated 13-10-1999, with the title "People shout Army Zindabad outside T. V. Station".
Statement of Allama Tahirul Qadri published in daily Nawa-e-Waqt dated 13-10-1998, titled "Army has taken over to defend the country".
News item published in News Islamabad dated 13-10-1999 with the .title. "Political, religious leaders hail change".
News item published in Nawa-e-Waqt dated 14-10-1999 titled "Teachers will offer prayer of thanks in Liaqat Bagh".
News item published in daily Khabrain dated 14-10-1999, comprising statements of the constitutional experts that Army did well - high treason case can proceed against former rulers.
Radio Monitoring Report . dated 14-10-1999 of BBC that Peshawarites welcome Nawaz Government's dismissal.
Radio Monitoring Report of BBC dated 14-10-1999 that JWP welcomes military action.
Radio Monitoring Report of BBC dated 14-10-1999 titled "Calm prevails in Pakistan after Military take-over".
Radio Monitoring Report of BBC dated 14-10-1999 "Life normal in Islamabad despite Military coup".
Radio Monitoring Report of BBC dated 14-10-1999 titled "Pak Army supports Gen. Musharraf's action".
Picture published in Pakistan Times 'Rawalpindi showing the jubilant people dancing in front of a banner reading "Long Live Pakistan Army".
News item published in News Islamabad dated 14-10-1999, with the title "Leaders continue to welcome Nawaz's ouster".
Statement of Mian Azhar Ex-Governor, Punjab, published in Khabrain dated 3-12-1999, titled "Army action is justified under the doctrine of necessity."
MAL-GOVERNANCE/CORRUPTION/
ACCOUNTABILITY
Legislators Pervaiz Ali Shah and others welcomed dismissal of Nawaz_Sharif and demanded across the board accountability.
Statement of Lt. Gen. ` Moinuddin Haider Ex-Governor that "Nawaz was urged not to appoint Advisers".
Statement of Governor State Bank that the defaulters owe 356 billion rupees.
Article of Prof. Dr. Shahida Wizarat titled "Crisis management of the economy".
Prof. Dr. Tahirul Qadri demanded accountability.
Two more cases against former Prime Minister sent to NAB.
Banks and financial institutions recovered Rs.5.6 billion out of their struck up loans.
26 top defaulters held?? , List of 31 references pending against the former Prime Minister Nawaz Sharif.
Transcript of BBC Television's documentary on corruption in Pakistan.
Summary of References filed against Nawaz Sharif and others for corruption and abuse of office.
A report to the people of Pakistan presented by the Pakistan People's Party about systemic corruption, money laundering and abuse of office by Nawaz Sharif.
Order dated 5-11-1999 passed by the High Court of Justice Queen's Bench Division, England, in Al-Towfeek Co. v. Hudaibiya Paper Mills Ltd. etc. about execution of decree against Sharif family.
Statement of Shezi Nackvi, Director of Al-Towfeek Co.
Exhibits "S N I" to the statement Shezi Nackvi, Director of Plaintiff Co.
Judgment dated 16-3-1999 of the Queens Bench Division in case titled Al-Towfeek Co. v. Hudaibiya Paper Mills etc.
Pedigree-table of Nawaz Sharif
List of Directors of Hudaibiya Paper Mills Ltd.
Sharif family's money laundering through travelling cheques, dollar bearer certificates and overseas accounts and purchase of property in London.
Letter/complaint of Mian Khalid Siraj (brother of Mian Sharif) addressed to Benazir Bhutto the then Prime Minister for inquiry into plundering and looting by Nawaz Sharif.
Statement of Saifur Rehman, Manager, Habib Bank A.G. Zurich, Lahore, about opening of accounts in the names of Muhammad Ramzan, Asghar Ali and Suleman Zia by Javed Kiani.
Statement of Syed Wajahat Hussain, Foreign Exchange Manager, Habib Bank AG Zarich, Lahore, about operating of 3 accounts of Muhammad Ramzan, Asghar Ali and Salman Zia.
Statement of Zaka. A. Malik, Handwriting Expert about comparison of writings/figures on transactions of foreign exchange.
Copy of F.I.R. No.12 of 1994 under sections 419, 420, 468, 471 and 109, P.P.C. and section 5 of the Prevention of Corruption Act, 1947, against Directors of Hudaibiya Engineering (Ptv.) Ltd. Regarding opening of fictitious Accounts in Habib Bank AG Zurich, Lahore.
Copy of F.I.R. No. 13 of 1994 under sections 419, 420, 468, 471 and 109, P.P.C. read with section 5 of the Prevention of Corruption Act, 1947 and Article 3 of Holders of Representative Office (Punishment for Misconduct) Order, 1977, against Directors of Hudaibiya Paper Mills. '
Bank record about the Account of Salman Zia.
Bank record about the Account of Asghar Ali.
Bank record about the Account of Muhammad Ramzan.
Extracts from the British Virgin Island Corporate Register about payment for purchase of property in London.
Payments to Shamrock Consulting Corporation through Salman Zia.
Photographs of Land Registry Records about property purchased by Sharif 'family in London.
Illustrative Charts about flood of funds from Salman Zia Account and money laundering by Sharif family.
Press clippings of foreign press about amassing of wealth by Sharif family.
Statement of Shezi Nackvi, Director of Al-Towfeek Co. as witness in the High Court of Justice Queens Bench Division.
Press clippings from News International titled "Living like a king? Sharif's litany of abuses"
Internet Report of Daily Dawn dated 22-10-1999 with the title "Sharifs business Partners deprived country of 110 Million Dollars.
Internet Report of Daily Dawn titled "four cases against Nawaz being sent to F.I.A.".
Internet Report of Daily Dawn titled "Banks challenge Ittefaq claims of engineered loan default".
Internet Report of Daily Dawn titled "Sharif family liable for all Ittefaq Group loans".
Where do we stand today? Economic Crisis.
Police encounters during the period from 1-7-1997 to 30-6-1999
Death in Police custody during the period from 1-7-1997 to 30-6-1999.
Reasons of pendency of judicial inquiries in police encounters.
Details of murders/crime against women and motive behind murder.
Punishments awarded to police officials accused during the period from 1-7-1997 to 30-6-1999.
Article by Amir Nawaz published in Friday Times of 22/ 28-10-1999, titled "Treason case against Nawaz;"
Statement of Imran Khan, published in Pak. Observer, Islamabad dated 20-10-1999, to the effect that Army interference had become compulsory and the elections before accountability will be meaningless.
Statement of retired Generals published in daily Jang Rawalpindi dated 27-10-1999, demanding impartial accountability of those who plundered the national exchequer.
Statement of retired Generals published in daily Jang Rawalpindi dated 27-10-1999, demanding impartial accountability of those who plundered the national exchequer.
Statement of Mr. Farooq Ahmed Khan Leghari, former President published in Khabrain dated 14-10-1999 demanding severe accountability.
Review of economic performance 1990-99.
Brief of Finance Division, Government of Pakistan (E.F. Wing) on Lahore-Islamabad Motorway Project (M-2)
Brief of Finance Division (E.F. Wing) on Islamabad-Peshawar Motorway Project (M-I)
Brief of Finance Division (E.F. Wing) on Lahore International Airport. New passenger terminal complex.
Brief of Finance Division (E.F. Wing) on exact nature and scope of cooperative scandal to the Members of the National Assembly.
List of cooperative societies, their directors doing banking business illegally.
Package announced by Prime Minister on 7-12-1993 to compensate affectees of Cooperative Societies.
Report of Finance Division (Budget Wing), Government of Pakistan in respect of "Mera Ghar Scheme".
List of defaulters of Rs.100 Million and above, as on 31-10-1999.
List of Telephone Numbers of Politicians tapped during previous regime without permission of D-.G., I.B.
List bf Telephone Numbers of Politicians monitored without approval of D.G., I. B. .
List of telephone numbers of Judiciary tapped without written approval of D.G., I.B.
CONDEMNATION OF DEPOSED REGIME
Press release .of Benazir Bhutto urging World condemnation of Nawaz reign of terror on Press in Pakistan.
Protest of the Committee to protect journalists against Government sponsored attacks on independent journalists, addressed to Nawaz Sharif.
BBC report about protest of journalists regarding arrest of Mr Najam Sethi, Editor Friday Times.
Article by Nadeem Shahid published in daily Nation Islamabad on 25-10-1999 titled "He wanted to be the King."
Article -by M.S. Qazi, published in Frontier Post Peshawar on 18-10-1999, titled "Nawaz's fall from grace".
Statement of Lt. General Sardar F.S. Lodi published in Nation Islamabad dated 21-10-1999, with the title "Losing heavy mandate. "
Article by Aslam Effendi published in the daily Nation, Islamabad, dated 16-10=1999 titled "Operation retribution or coup de grace".
Statement of Malik Meraj Khalid published in the daily Frontier Post dated 15-10-1999, hailing Army action with title "Nawaz's misdeeds paved way for army."
Statement of Altaf Hussain, MQM Chief published in daily news Islamabad with the title "Nawaz responsible for army action.
Radio Monitoring Report of BBC dated 14-10-1999, titled "Army coup outcome of Nawaz Sharif's mistake".
Statement of Gen.(Retd.) Mirza Aslam Beg, published in News Islamabad dated 6-12-1999, with the heading "politicians responsible for army take-over.
Interview of Aftab Ahmed Sheikh of MQM published in Takbeer Weekly dated 8-12-1999 titled "Nawaz Sharif. himself invited Army".
?
Statement of Qazi Hussain, Ahmed published in News Islamabad dated 12-12-1999, with the title "only-Nawaz Sharif responsible for military coup."
Statement of M. Azam Khan Hoti of ANP published in daily Frontier Post dated 27-12-1999, titled "Nawaz still conspiring against army".
NECESSITY FOR TAKE OVER
Article by Amir Mir published .in daily news Islamabad, dated 13-10-1999 titled "Military Take-over legal under law of necessity according to Supreme Court ruling."
Radio Monitoring Report of BBC dated 14-10-1999, titled "Musharraf terms military intervention as last resort".
The learned Attorney-General submitted that the Proclamation of Emergency and the PCO are legislative instruments of extra-constitutional character, which fall within the ambit of doctrine of necessity, particularly in view of the question of State survival being involved in the present case, and as such the same are not open to judicial review. However, the status of all other acts and actions of the Chief Executive may stand on different footing in terms of the law laid down by this Court in Nusrat Bhutto's case (supra), in particular the observations at pages 715, 720 and 721 of the report. He reiterated that prime object of the Chief Executive is to hold fresh elections after cleansing the system as soon as practicable and possible.
At the conclusion of his arguments, while making certain clarifications, the learned Attorney-General filed written submissions for the sake of precision and clarity so as to avoid misunderstanding and misgivings. His submissions were: -
SUBMISSIONS
ON BEHALF OF THE FEDERATION
1.???????? In deference to observations of the Hon'ble Court on 5-5-2000, regarding the dates of transfer of properties at Raiwind, the Respondent Federation submits herewith the authenticated Revenue Extracts showing the dates of mutation/purchase of properties at Raiwind (8 pages) from 31-1-1984 to 24-9-1999 alongwith the letter dated 6-5-2000 of the Deputy Commissioner, Lahore.
2.???????? It is submitted on behalf of Respondent Federation before this Honourable Court that the contents of the documents produced at pp.13 to 135 in Volume-X of Respondent along with the Written Statement in compliance with observations and directions of the Hon'ble Court were verified by NAB from the Election Commission and Central Board of Revenue and concerned authorities before being supplied by the Government of Pakistan through NAB and each page bears the signature of an authorised officer of NAB. The documents are filed on behalf of and under instructions of the Federation and the - said documents contain information and declarations of the former Parliamentarians and Members of the Provincial Assemblies themselves before the Chief, Election Commissioner and Income Tax Authorities. NAB has prepared the documents on the basis of the declarations made before the said authorities. The said documents are produced for the purpose of showing discrepancies in the respective declarations for the same period, before the Election Commission arid the Wealth and Income Tax Authorities.
3.???????? The Attorney-General is appearing, before the Hon'ble Court as a part of his duty on behalf of the Federation and in response to notice from the Hon'ble Court, and not in his personal capacity. The Federation has filed separate lists of (a) loan defaulters (b) for misdeclaration of assets before the Election Commissioner and Tax authorities and (c) persons whose telephones were taped. Certain press reports appearing on 6-5-2000 have mixed up the names of one list with the other resulting in misunderstanding. The statements of some politicians on the basis of such reports as appearing in the press on 7-5-2000 imputing allegations against the Attorney-General are misleading, unjustified, motivated and denied as all facts and documents produced before the Hon'ble Court as per lists were based on instructions, verified record provided by NAB and the Federation. The above is respectfully brought to the notice of the Hon'ble Court so that there is no further interference with the course of justice.
4.???????? Volume-X similarly contains among others at pages 1 to 7 statement of expenditure in connection with expenses in the General Elections of 1985, 1988, 1990, 1993 and 1997, the last of which caused to the national exchequer a sum of Rs.1,054,495,101 as certified on 2-3-2000 by the Election Commission, Pages 1 to 7 disclose such expenditure as well as the total expenditure incurred by the MNAs in the General Elections of 1997 as well as the outstanding dues against the Members of the Parliament on account of room rent, utility bills etc. outstanding against former Parliamentarians as on 1-3-2000 (pages 8 to 14) as supplied by C.D.A.
6.???????? Volume-III contains the order of the High Court of Justice Queen's Bench Division, London dated 5-11-1999 at page 1 and Judgment, dated 16th March, 1999 disclosing the Suit filed by Al-Towfeek Company against (1) Hudaibiya Paper Mills, (2) Mian Muhammad Shehbaz Sharif, (3) Mian Muhammad Sharif, and (4) Mian Muhammad Abbas Sharif ordering the said defendants therein to pay a total sum of over US$ 32 Million to the Plaintiff Bank Al? Towfeek Company for -loan advanced by the said Company to Hudaibiya Paper Mills owned by the Sharif family. At page 3, four flats at Park Lane are mentioned as belonging to Sharif family which were ordered to be attached in the said suit. At page 5, the Written Statement of Mr. Shezi Nackvi of the Plaintiff company before the Hon'ble Court of Justice at London sets out the details and the amounts payable by the Sharif family. The properties of the family are mentioned at page 7. At page 20, is the Judgment delivered on 16th of March, 1999 for payment of over US$ 14 millions as the first instalment. At page 23 a list of Directors of Hudaibiya as filed in the Court at London has been filed which shows the names of Members of the Sharif family as Directors. Pages 24 and 26 contain the signatures of Hussain Nawaz. Volume? III contains those documents which were actually produced in the High Court of London including Bank Statements/cheques of foreign accounts held by the family of the former Prime Minister. The cheques are mentioned at page 106 onwards. All this information has been suppressed and not disclosed to concerned authorities in Pakistan, nor to this Hon'ble Court.
7.???????? On the basis of this, the High Court of London passed a Decree/Order, dated 5-11-1999 for execution of the Decree, of nearly US $ 32 Million as stated above out of which the Sharif family has paid to the plaintiffs a sum of approximately US$ 9 Million on March, 2000 as first instalment in part payment. This fact has also been suppressed and on the other hand shows the assets of the family abroad which, remain undisclosed to a substantial extent.
8.???????? Volume-VII of the respondent contains the affidavits of Lt. Gen. (Retd.) Nasirullah Babar and Lt. Gen. Asad Durrani in H.R.C. No. 19 of 1996 filed by Air Marshal (Retd.) Asghar Khan pending in this Hon'ble Court setting out therein the fact of payment of a sum of Rs. 140 million to the various politicians including IJI. This shown that the electoral mandate was obtained by corrupt practices.
9.???????? Volume-VIII at pages 140 to 155 shows a sum of Rs. 6,146 Million borrowed by Mian Nawaz Sharif Family and business concerns from 31-Banks/DFIs (p.141) which remain to be cleared. Volume? VIII at p.69 to 106 and p.156 to p.I90 contains detailed list of properties including those held in Chunian which after purchase was declared as Tax Free Zone and Industrial Area for illegal gain. At pA66 of Volume-VIII the names of 5 Industrial Units of the Sharif Family are mentioned as located in Tax Free Zone. The' map showing the zone is at p.190.
10.?????? At pages 136 and 137 of Volume-X is the tabulation of the statements of 37 Banks/DFIs in respect of withdrawal of Foreign Exchange of over 171 Million US Dollars, from 11-5-1998 to 28-5-1998 showing mismanagement and misgovernance.
11.?????? House at Raiwind Farm was declared as official residence of the former Prime Minister and Pak PWD was assigned responsibility of its maintenance (P.152 of Volume-X)
12.?????? The Respondent Federation submits that the Proclamation dated 14-10--1999, the Provisional Constitution Order of the same date and any other Order made by the Chief Executive pursuant to the said proclamation are valid and cannot be called, its question on the basis of the Judgment delivered in Begum Nusrat Bhutto's case reported in PLD 1977 SC 657 at pages 721-722 and further reaffirmed by this Hon'ble Court in the case of Mehmood Khan Achakzai reported as PLD 1997 SC 426 at page 472, para. 45 on the ground of State necessity and State survival.
"It is further submitted, however, that the Proclamation dated 14-10-1999 cannot form the subject-matter of judicial review based as it is upon the doctrine of necessity and State survival and accordingly the Chief Executive is fully competent to perform all such acts and promulgate and take all legislative measures which have been recognized by judicial authorities as falling within the scope of the doctrine of necessity as held and declared at pages 715 and 716 inter alia in paragraphs (iii) (a) (b) (c) (d), (iv) and (v) thereof, and paragraphs (i) to (vii) at pages 721 and 722 in the judgment of Begum Nusrat Bhutto's case and reaffirmed in the case of Mehmood Khan Achakzai by this Hon'ble Court on the grounds of State Necessity and State survival, and-for orderly running of the State.
"Without prejudice to the contents of the Statement of the Federation and documents already on record, it is submitted, that the petitions are accordingly liable to be dismissed by this Hon'ble Court."
ARGUMENTS OF MR. KHALID ANWAR IN REBUTTAL
Rebutting the arguments advanced by Syed Sharifuddin Pirzada, learned Senior ASC and Mr. Aziz A. Munshi, learned Attorney-General for Pakistan, Mr Khalid Anwar submitted that in the opening session, Syed Sharifuddin Pirzada admitted the fact that the Supreme Court has full power of judicial review and notwithstanding the Proclamation of Emergency and the PCO, this Court retained its jurisdiction and power of judicial review and further that the new oath under the Oath of Office (Judges) Order No. 1 of 2000, has in no way affected the ability of the Judges of this Court to decide the validity, legal effectiveness and operation of the above instruments. He added that there is a consensus statement of the lawyers of the petitioners and the respondents on this point. He further clarified that though the Constitution in a technical sense has been suspended but it still rules indirectly because jurisdiction is conferred upon this Court by the Constitution and not the Proclamation of Emergency or the PCO, therefore, the power of judicial review of this Court is still intact. He argued that in the present scenario it is only the Supreme Court and no other institution or authority, which can validate the Proclamation of Emergency and the PCO and thereby grant legitimacy to the present Government, which is the relief they are seeking from this Court. He drew attention of the Court to the concise statement of Syed Sharifuddin Pirzada whereby he has only sought validation of the action of 12th October, 1999 by this Court and made no prayer seeking powers to amend the Constitution or carrying out economic, political or social reforms in the society. He then read out a part of the speech delivered by the Chief Executive on 13th October, 1999 to contend that the sole purpose of the Army take-over on 12-10-1999 was to prevent any further destabilization of the country and that the situation was perfectly calm and under control. . He contended that the Chief Executive in his above speech further appealed to the people to remain calm and support the Army in the re-establishment of order, which meant that he did not seek to create a new order through changes in the Constitution or laws.
Mr Khalid Anwar submitted that he would rely on material cited on behalf of the respondents because their own material supported his view. He thereafter dealt with each item of the case law relied upon by Syed Sharifuddin Pirzada. He argued that "65-Corpus Juris Secundum" (page 389), sub-heading "Public Necessity", relied upon by Syed Sharifuddin Pirzada, makes it clear that the existence of public necessity would be decided by the legislature and no one else. Relevant portion reads thus:'
"Public necessity. A relative term meaning urgent public convenience; in this connection inconvenience may be so great as to amount to necessity."
"With reference to legislative action, that, urgent, immediate public need arising from existing conditions which, in the judgment of the legislature, justifies a disturbance of private rights which otherwise might be legally exempt from such interference. It does not necessarily mean public benefit. The term is employed to designate the requirement of what is needed for reasonable convenience, facility, and completeness in accomplishing a public purpose."
He referred to "Judicial Review on Administration Action" by De Smith, wherein it was observed at page 544 as under:
"A person who is subject to disqualification at common law may be required to decide the matter if there is no other competent tribunal or if a quorum cannot be formed without him. Here the doctrine of necessity is applied to prevent a failure of justice. So, if proceedings were brought against all the superior Judges, they would have to sit as Judges in their own cause..."
(i)???????? The balancing test requires a balancing of the ends which an official decision attempts to achieve against the means applied `to achieve them. .
(ii)??????? The necessity test requires that, where a particular objective can be achieved by more than one available means, the least harmful of these means should be adopted to achieve a particular objective.
(iii)?????? The suitability test requires authorities to employ means which are .appropriate to the accomplishment of a given law, and which are not in themselves incapable of implementation or unlawful. "
and contended that the remedy should be proportional to the disease. He asserted that both America and Europe are one on the selection of least harmful means in order to achieve the objective, which, according to the Chief Executive, is re-establishment of order in the country on 12th October, 2000.
He then reverted to Farzand Ali's case,(supra) and contended that no reliance can be placed on the de facto doctrine by the Government on the basis of this case, inasmuch as, the finding in the above case was that if a person is holding an office illegally, no one can challenge the validity of his acts in a collateral proceedings for the sake of order and regularity except by direct proceedings instituted by the State or by someone claiming the office de jure. He argued that since the present proceedings were resorted to by the parliamentarians directly claiming to hold the office of members of National Assembly, Senate and Provincial Assemblies, they are entitled to challenge the same.
As to the case titled "Mokotso v. H.M. King Moshoehoe II (1989 LRC (Const.) 24), referred to by Mr Pirzada, Mr Khalid Anwar submitted that this was a case of coup d'etat and could not be a model for Pakistan. Then he proceeded to deal with the case of Mitchell v. Director of Public Prosecutions (1986 LRC (Const.) 35). and contended that the said case is similar to that of Mahmood Khan Achakzai in which the 8th Amendment was ultimately approved and upheld by the Supreme Court, in that, in the former case, the Grenada Courts held that because Constitutional Government has been restored, it is the action of the Constitutional Government, which has conferred validity and legitimacy on the Martial Law. Mr Khalid Anwar argued that this case goes against the arguments of Mr Pirzada because principles of International Law have nothing to do with it.
Adverting to the case of The Attorney General of Republic v. Mustafa Ibrahim, Mr. Khalid Anwar contended that an impression was sought to be created that in France, Germany, Italy, etc. there have been martial laws or military coups d'etat and surely this Court can take judicial notice of all these things but it was all about "doctrine of necessity" and not of "doctrine of State necessity", therefore, it does not advance the case of the respondents. He contended that it was common ground in Begum Nusrat Bhutto's case that Martial Law had been imposed in the country whereas in the present case it has been argued by Syed Shariffuddin Pirzada that this is not Martial Law, therefore, the ratio decidendi of Nusrat Bhutto's case is not applicable to this case.
Mr. Khalid Anwar then took up Volume "B" filed by Mr. Pirzada and referring to the case of Fred Toyosaburo Korematsu v. United States of America at page 132 thereof, contended that it again relates to "public necessity" and not "State necessity" and that this judgment was criticized in volume `G' filed by him, page 77, footnote 5 and also page 83. He next referred to a report namely "States of Emergency" - A study prepared by the International Commission of Jurists, which was read out by Syed Sharifuddin Pirzada at some length from page 14 onwards. Mr. Khalid Anwar referred to its criticism at pages 17,18,21-23.
Mr. Khalid Anwar submitted that if reliance can be placed on the Commonwealth Finance Ministers Meeting about corruption, then surely, reliance can be placed on the Commonwealth Prime Ministers Conference in which Pakistan was suspended from the Commonwealth for having an undemocratic Government.
According to Mr. Khalid Anwar, the only question before the Court today is as to which of Mr. Pirzada's view in his capacity as (i) Counsel; and (ii) Legal Scholar has to be referred as the views expressed by him as a writer are his true views, therefore, he accepts them in toto in so far as they relate to the present controversy.
He referred to Article 260 of the proposed Constitution of Pakistan, which, according to Mr Pirzada was drafted by Justice A.R. Cornelius, who was then Law Minister and contended that firstly, this Constitution never came into force and secondly, the responsibility rested on General Yahya Khan and that surely this was the action of General Yahya Khan, the then Chief Martial Law Administrator, who is not considered as a model today. Instead, he was the man who was responsible for the dismemberment of Pakistan.
Mr. Khalid Anwar argued that there is a saying, "Power corrupts and absolute power corrupts absolutely" and if that be true then the Supreme Court should not confer absolute power on the Chief Executive to get rid of the legislature and authorise him to exercise all powers by validating the impugned action of 12th October, 1999. , 125. Mr Khalid Anwar further contended "Constitutional and Administrative Law" by Hilaire Barnett and "Constitutional and Administrative Law" by Stanley De Smith and Rodney Brazier relied upon , by Mr. Pirzada talked about the doctrine of necessity and not state necessity.
As regards the arguments, of Mr. Aziz A. Munshi, the learned, Attorney-General for Pakistan, Mr Khalid Anwar submitted that in regard to facts and figures about turnover in the last four general elections, held in 1988, 1990, 1993 and 1997, it is interesting to observe that in 1997 general election, no party in the history of Pakistan got more seats than the Pakistan Muslim League. He further submitted that in 1993, the PPP got 7.8 million votes while in 1997 it came down 4.2 Million. In 1993 Muslim League got a major chunk of 8.2 million votes. He argued that what had happened was that people who were loyal to the PPP by and large did not vote for the Muslim League and stayed away. Regarding Al-Towfeeq & Co., it was argued that Nawaz Sharif was not a party to this case and a wrong impression was sought to be created that the same proved default against Nawaz Sharif.
Mr Khalid Anwar referred to the submission of the learned Attorney-General relating to fake foreign currency accounts of one Salman Zia allegedly sponsored by Mian Nawaz Sharif's family and submitted that this entire transaction forms subject-matter of a Full Bench judgment and Division Bench judgment of the Lahore High Court respectively reported as Hamza Shehbaz Sharif v. Federation of Pakistan (NLR 1998 (Crl.) 103) and Huddaibia Engineering v. Pakistan (PLD 1998 Lahore 90). He referred to paragraphs 5 and 6 of the latter report to contend that these . cases were quashed:
"5. On 8-11-1994 the appellant filed the Constitutional Petition (W. P. No. 14532/94) seeking a direction ~ to the Federal Investigation Agency to refrain from taking any proceedings under the F.I.R. This petition was dismissed by the learned single Judge on 19-12-1994 who was of the view that immunity and protection granted by section 5 of the Protection of Economic Reforms Act, 1992 only extended to those transactions in foreign currency accounts which were bona fide. It was observed that sections 5 and 9 of the Act have to be read together and as section 9 protects only bona fide banking transactions the immunity granted by section 5 of the Act was not pervasive but limited to transactions which are bona fide and not otherwise."
"6.??????? During the pendency of this appeal, certain developments took place of which notice must be taken. After investigation of the case, Federal Investigation Agency had submitted challan to the Special Court constituted under the Offences in respect of Banks (Special Courts) Ordinance, 1984 under section 419/420/468/471 read with section 109, P.P.C. The other offences mentioned in the F.I.R. namely section 5 of the Prevention of Corruption Act, 1947 and Article 3 of the Presidential Order 16 of 1997 seeking quashment of the challans submitted to the Special Court were filed by Mukhtar Hussain and.Hamza Shehbaz. A Full Bench of this Court has since allowed these two petitions holding that the case had been registered by the F.I.A. without any lawful authority and even on merits no case was made out on the face of record and the continuous prosecution would be an abuse of the process of the Court. However, while disposing of those Constitutional petitions, the question as to the effect and scope of Protection of Economic Reforms Act, 1992 was not gone into by that Bench and was left to be determined in this appeal by observing that:-
"As regards the Intra-Court Appeal presently pending, his submission is that it would be pressed only to the extent of the decision of the learned single Judge with regard to the interpretation placed by him on the relevant law, regarding the immunity available to the foreign exchange accounts under Economic Reforms Act XII of 1992."
He next submitted that the only reference actually filed against Mian Nawaz Sharif is the helicopter case in which it was alleged that though he used the helicopter during his election campaign but did not declare it as a part of his asset.
Mr. Khalid Anwar argued that since Mian Nawaz Sharif is neither a petitioner nor a respondent, no observation should be made by this Court regarding his conduct. He added that this is especially true when criminal cases are pending -against him which will ultimately come in appeal before this Court, therefore, it would be most improper for the Government to bring his conduct under the subject-matter of the present litigation. To support this point, he referred to the case of Mushtaq Ahmed Gormani v. State (PLD 1958 SC 333), wherein certain observations were made against the then Prime Minister, Malik Feroz Khan Noon, which were ultimately expunged by the Supreme Court because he was not a party to the proceedings. Reliance was also placed on Amanullah Khan v. Federal Government of Pakistan (PLD 1990 SC 1092) for the same proposition.
Referring to the allegation made by the learned Attorney-General that Chunian Estate in Kasur was purchased just before the issuance of Notification in 1987 creating an Industrial Estate there by the CBR and, thus, derived benefits, Mr Khalid Anwar contended that the alleged estate was purchased by Nawaz Sharif family in 1984, much prior to the issuance of the above notification and that in 1987 Military Government was in power, therefore, if any corruption was committed, the blame would rest on the then Military Government.
Regarding allegation of misdeclaration of assets before the Election Commission and the Wealth Tax Authorities, Mr Khalid Anwar contended that there was no real misdeclaration of assets, in that, under the Wealth Tax, one declares the cost of property or market price and under the Election laws one declares the value which is artificially calculated to represent 10 years' annual letting value. Referring to the alleged misdeclaration of pension of $ 20,000 per annum received by Mr. Sartaj Aziz from United Nations, he contended that pension is like salary and not an asset. He also pointed out that under the Wealth Tax Act, dollars are not taxable.
Further dealing with the argument advanced by the learned Attorney-General that the references filed in the Accountability Courts under the NAB Ordinance have established corruption of the politicians, Mr Khalid Anwar contended that the list of References included names of Air Vice Marshal Waqar Azim, several businessmen and some politicians, who are not party to the present proceedings and, therefore, no comments could be made about them.
He submitted that in the budget for the years 1997, 1998 and 1999, civil departments of the Government were allocated Rs. 69 billion only, whereas defence department of Pakistan was allocated Rs. 145 billion i.e. just one department of the Government incurs double expenditure. The argument was that military officers are outside the ambit of accountability and they have been excluded from accountability despite the fact that there is a serving General, who is head of the NAB, which fact negates the plea of across the board accountability.
He further contended that in 1977 according to Begum Nusrat. Bhutto's cast, the military government wanted time to carry out accountability before elections. He argued that ninety days became ninety months but no accountability was carried out and that corruption at the end of the latter period had in fact multiplied.
Mr Khalid Anwar also referred to the submission regarding Mehran Bank Scandal on which the learned Attorney-General had laid great emphasis to show corruption of politicians and contended that Mirza Aslam Baig former Chief of Army Staff obtained Rs. 14 crores from Younis Habib. Chairman of Mehran Bank for disbursement to various politicians and all those payments were made by Lt. Col. Mir Akbar Ali Khan, Rawalpindi Headquarters.
Regarding telephone tapping by the former Government of Mian Nawaz Sharif, Mr. Khalid Anwar condemned tapping of the telephones of Chief Justice of Pakistan and other Judges of the superior Judiciary and called it a shameful act.
As to the judgment of Anti-Terrorist Court in the plane hijacking case against Mian Nawaz Sharif, Mr. Khalid Anwar submitted that reference to the case in these proceedings is not appropriate in that an appeal is pending in the High Court and the matter is likely to come before this Court.
Mr. Khalid Anwar denied the allegation that 15th Constitutional Amendment bill was intended to be introduced with a view to grabbing more powers by the Prime Minister.
Mr. Khalid Anwar further argued that the reaction of the people in welcoming the Military take-over is of no consequence in that the political parties which earlier welcomed the impugned action of the Chief Executive are now stressing for early restoration of democratic rule. He also referred to a book titled ""Public Opinion" and Political Developments in Pakistan by Inamur Rehman to contend that public opinion is transient in nature. He further argued that charges of corruption and corrupt practices against the previous Government are of no consequence in that there is corruption in many other countries of the world including Germany, England, Italy, Japan, etc.
Mr. Khalid Anwar further submitted that the mere fact that the decision of Army take-over was allegedly made by the Corps Commanders and the Principal Staff Officers as contended by the learned Attorney?-General is of no legal consequence in that none of the above officers has any constitutional role to do so. He reiterated his submission that Begum Nusrat Bhutto's case warranted revisiting. He vehemently contended that- the Elections of 1997 were fair and transparent.
ARGUMENTS OF S. M. ZAFAR, LEARNED AMICUS CURIAE
Mr. S.M. Zafar, learned amicus curiae submitted that whenever there is a constitutional breakdown, coup detat or otherwise, Judges are invariably confronted with an ethical dilemma on each occasion for which law prescribed no solution. He submitted that every Judge makes up his own mind either to resign or to continue as a Judge under the new dispensation. Those who opt to continue in office, as the Judges of this Court have done, they take upon themselves a very important historical burden of maintaining national legal order in the face of unconstitutional or extra-constitutional takeovers.
Mr. S.M. Zafar next submitted that since its inception, Pakistan has actually struggled with various Constitutions as well as couple of forms of Government i.e. Presidential, Parliamentary or abrupt political changes not contemplated by the Constitution. He submitted that in this milieu of changes, it is significant to note that whatever the nature or magnitude of a change, the Judiciary has continued to survive, inasmuch as, there has been no institutional interruption or discontinuity of Judiciary as such. He then proceeded to narrate a brief history of Judiciary to show as to why there has been no institutional interruption. , 143. He submitted that on independence, Pakistan inherited a reconstituted faction or part of Federal Court of India as the Federal Court of Pakistan by virtue of the Government of India Act, 1935 and more importantly by virtue of PCO 1947. On 24th of October, the then Governor-General Malik Ghulam Muhammad dissolved the Constituent Assembly, but Judiciary continued and it not only continued, but it was finally able to decide the issue of dissolution of the Constituent Assembly. That was the first interruption that took place. On .23-3-1956 the first Constitution was passed. It did change the nomenclature of the Court from Federal Court to Supreme Court of Pakistan under Articles 148 and 227(3) of 1956 Constitution:
" 148. There shall be a Supreme Court of Pakistan consisting of a Chief Justice, to be known as the Chief Justice of Pakistan, and not more than six other Judges:
Provided that Parliament may by Act increase the number of other Judges beyond six."
"227(3).- All legal proceedings pending in the Federal Court, immediately before the Constitution Day, shall, on such day, stand transferred to, and be deemed to be pending before, the Supreme Court for determination; and any judgment or order of the Federal Court delivered or made before the Constitution Day shall have the same force and effect as if it had been delivered or made by the Supreme Court.
"Now, in the present case, Mr. M. Anwar had himself filed an appeal in the Supreme Court in Asma Jillani's case against the original judgment of the Lahore High Court. The hearing of the appeal was scheduled to commence on the 16th of March, 1972, whereas Mr. Anwar's interview was published in the weekly 'Kahani' bearing the date 10th March, 1972. In this interview he had expressed himself strongly against the decision of the Supreme Court in Dosso's case, and this was also his main stand in the appeal filed by him. We have already seen that in his interview Mr. Anwar had not only questioned the correctness of the judgment in that case but had also attributed motives to the. learned Chief Justice who delivered the leading judgment and had also indicated in no mild terms, the other judges of the Supreme Court who had concurred with the learned Chief Justice. Even if we may not go along all the way with the learned Attorney-General in thinking that the publication of the interview, a few days before the commencement of the hearing of the appeal in Asma Jillani's case, was intended to "brow-beat and blackmail" the Judges of this Court, it is clear that the publication was indeed calculated to influencing the mind of the Judges against endorsing the view taken in Dosso's case. It is irrelevant whether this was the intention of the respondents in publishing the interview or whether it has to be seen is whether the publication had the tendency to prejudice their minds in the matter. We consider, therefore, that the publication in question also amounts to contempt of Court as it had the tendency to prejudice the determination of a matter pending before this Court.
"The fact that, while deciding Asma Jillani's case, the Supreme Court did ultimately accept the position canvassed by Mr. Anwar against the doctrine expounded in Dosso's case, and expressed itself rather strongly in this behalf, has, however, no bearing on the nature of the publication we are considering here. It is axiomatic that the Court is bound to decide a pending cause in the view expressed in the offending publication, cannot in any manner detract from its pernicious tendency to prejudice the determination of the cause when it was still pending. At best such judicial endorsement might be urged was a mitigating circumstance in the matter of punishment for the contemner.
"A reference to the terms of this Article does indeed show that it is not in the nature of a provision for the continued existence and functioning of the President or the Chief Justices, and Judges holding office under the previous Constitutional Order; but it does, nevertheless, indicate a sense of continuity by providing that, for the purposes of this Constitution, in relation to a period prior to the commencing day, any reference to the holders of these offices shall be construed as a reference to the incumbents in office immediately before the commencing. day.
"However, it is difficult to place this meaning on this clause for the reason that the Supreme Court has generally not been regarded as falling in the category of a civil, criminal or revenue Court, nor have the Chief Justice and Judges been described as judicial officers. The Court as well as the Chief Justice and the Judges fall in a distinct category created by the Constitution, and different from civil, criminal and revenue Courts and the Presiding Officers thereof. We consider, therefore, that irrespective of the entry appearing in the index to the 1962 Constitution, clause (5) of Article 234 has no application to the Supreme Court and the Chief Justice and Judges thereof.
"The combined effect of these provision was that all pending proceedings in the Supreme Court as well as the other Courts in the country were to continue in accordance with the law under which they were commenced or instituted. It also followed that such proceedings would be continued in the same forum in which they were commenced, unless the Constitution expressly provided to the contrary. As a result, the Supreme Court established under the 1962 Constitution automatically assumed jurisdiction in all matter which were pending before the Supreme Court immediately before the commencing day. This position was not altered in any manner by the fact that the 1962 Constitution may have varied the jurisdiction of the Supreme Court as compared to the one available under the 1956 Constitution.
"For all these reasons, we have no doubt in our mind that the Supreme Court as established under the 1956 Constitution itself was abrogated in 1958 on the proclamation of Martial Law, and the Laws (Continuance in Force) Order, 1958, was in turn repealed by Article 225 of the 1962 Constitution, which provided for the establishment of a Supreme Court, and at the same time contemplated that the Chief Justice and the Judges in office immediately before the commencing day shall continue to hold their respective offices, but take a new oath of office and allegiance to. the new Constitution as soon as practicable after the commencing day. Such being the case, the Supreme Court functioning under the 1962 Constitution would by fully competent to punish any contempt relating to the Supreme Court of Pakistan or any of its Judges as constituted in 1958.
"The present proceedings before us were instituted on 17-3-1972 under Article 123 of the 1962 Constitution. As is well-known, the 1962 Constitution was abrogated on the 25th of March, 1969 on the proclamation of the second Martial Law, but under paragraph 6(2) of the Provisional Constitution Order, 1969, the Supreme Court, the High Courts and all other Courts and tribunals were enabled to exercise the same powers and jurisdiction as they had immediately before the issuance of the proclamation. Accordingly, the Supreme Court had the Jurisdiction to deal with this matter under Article 123 of the 1962 Constitution at the time it was initiated.
"The provisions contained in the Interim Constitution of 1972 as well as in the Permanent Constitution of 1973 follow the same pattern as was adopted in the 1962 Constitution to ensure the continuity of the legal order, the functioning of institutions like the Supreme Court, the High Courts and other civil, revenue and criminal Courts, and the continuance in office of the Chief Justice and Judges of the Supreme Court and the High Courts, as well as of all other persons in the service of Pakistan. It follows, therefore, that it is a misconception to think that the present Supreme Court, or the Supreme Court constituted under the 1962 Constitution, was, in any manner, a new or a different institution. The correct position appears to be that the Supreme Court and the High Courts established under the 1956 Constitution have been assiduously maintained intact in spite of successive constitutional changes; and their continuity is reflected .not only by the fact that their Chief Justices and the Judges have been continued in office, but also by the fact that all pending proceedings have been continued by the respective Courts under the laws under which they were initiated or continue to be competent to punish any acts amounting to contempt even though they relate to the functioning of these Courts or these Judges as constituted under earlier constitutional instruments.
It will be seen from the authorities, to which we have already referred in an earlier part of-this judgment, while considering the question whether the offending Article constitutes contempt or not, as well as from the terms of clause (2) of Article 123 of the 1962 Constitution, that the offence of contempt of Court is committed if there is interference with or obstruction of the process of the Court; or scandalisation of the Court or nay Judge of the Court such as is calculated to diminish the dignity or authority of the Court and to impair public confidence in its independence, impartiality, and integrity. As observed in the cage of Fakhre Alam v. State (1), the object of contempt proceedings is not the vindication of the character or conduct of an individual Judge, but to protect the Court from attack and calumny, so as to keep the fount of justice pure and unsullied and to maintain public confidence in the ability and power of the Courts to administer justice.
Reference was also made to a passage from Nusrat Bhutto's case at ?age 717:
"Next, even if for any reason the principle or power of judicial review embodied in the relevant provisions of the 1973 Constitution be held not to be available under the new dispensation the fact remains that the ideology of Pakistan embodying the doctrine that sovereignty belongs to Allah and is to be exercised on his behalf as a sacred trust by the chosen representatives of the people, strongly militates against placing the ruler for the time being above the law, and not accountable to any one in the realm. Muslim rulers have always regarded themselves as being accountable to the Courts of the land for all their actions and have never claimed exemption even from personal appearance in the Courts. The Courts of Justice are an embodiment and a symbol of the conscience of the Millat (Muslim community), and provided an effective safeguard for the rights of the subjects. On this principle as well, the power of judicial review for judging the validity of the actions of the Martial Law Authorities must continue to remain in the superior Courts."
"Lastly, the Court is bound to take note of the fact that already several instances have been brought to its notice where the ordinary civil rights of the people are being interfered with by the subordinate Martial Law Authorities even though the laws of the land, which have been kept alive under the Laws (Continuance in Force) Order, 1977, m;kke full provision for their adjudication. In some cases, interference has occurred even when the contending parties had already been litigating in the civil Courts regarding the same disputes. The necessity which justified the Proclamation of Martial Law did not arise owing to the failure of the Courts to adjudicate on these matters. Such matters must, therefore, continue to fall outside the purview of the Martial Law Authorities, and the only remedy to the citizens against any such encroachment can be by way of judicial review in the superior Courts. "
"IN DEFENCE OF THE CONTINUITY OF LAW PAKISTAN'S COURTS IN CRISES OF STATE by Dieter Conrad which say:-
1.???????? An uphill task
"Repeatedly, the Courts have been involved in the paradoxical task of delineating, from first principles, some constitutional contours of extra-constitutional action. They have, thus, produced a whole series of judicial pronouncements dealing at explicit length with the validity of extra-constitutional emergency measures and of revolutionary changes."
2.???????? Two prototypes of constitutional crisis
"The pivotal practical question in this context, as to how the law Courts should re-act to suspension of, and revolutionary changes in, the Constitution, has been discussed more than once. It is the underlying question in the recent study on the `doctrine of necessity'.
"It appears from this analysis, with convincing clarity, that there are two basic types of Court responses to constitutional break-down classed by him as necessity' cases andKelsen" cases respectively."
"It seems to me that the two types of judgments should be viewed in relation to two different types of political situation, and that a Court's re-action might reasonably differ in the two."
"These two types of extra-constitutional action may conveniently be characterized by drawing on a distinction from German doctrinal discussion, namely of commissarial and sovereign dictatorship."
"??????????.The difference is that the commissarial dictator is ultimately bound to, though not presently restricted by, the existing Constitution, while the sovereign dictator justifying his actions from the future order is not measured by any precise constitutional yardstick. "
"The upshot of this brief recapitulation is that the Pakistan Court has resorted to the doctrine of necessity in situations offering a reasonable prospect that extra-constitutional action might be kept within the bounds of commissarial dictatorship;"
"A change of the Constitution, revolutionary or otherwise, need not imply a-change of the total legal order; the fiction of a total change is inappropriate to describe what actually is nothing but a change of the power to effect changes in the legal order. If all existing law becomes subordinate to a new law creating authority, it does not follow that its continued validity derives from it: valid law simply remains valid unless or until altered by the law creating organ. Constitutional provisions expressly keeping in force the bulk of existing law (Laws Continuance in Force Orders) have primarily a declaratory, or perhaps clarificatory, effect."
"It is plain to see that a principle of minimal recognition with respect to illegal constitutional change, or, the endeavour to limit legal effects of political changes to the narrow political sphere under the doctrine of implied mandate, would easily fit into this general conception. "
"the difference between a legal system's apex norm, and the Constitution, stands out more clearly. We have to perceive the Constitution not as the foundation of a legal system, but as itself founded in it."
"The significance of Pakistan's great constitutional cases lies in the fact that the Courts have constantly assumed the power `to say whether what had happened, was legal or illegal' i.e. to Judge the validity of constitutional enactments."
"There are no convincing reasons, why Courts should be any less entitled than the executive to claim extraordinary powers under State Necessity in order to overcome legal chaos and effect an ordered transition to legality. Thus, necessity can be invoked as an independent basis of jurisdiction, if no other remedy is left; this has been held in the Cyprus case of A.G. v. Mustafa Ibrahim."
"for an oath to administer law in accordance with such a Constitution could be legally imposed on a Judge only in so far as that constitution is `law' itself, i.e. legally valid. A political oath could, therefore, not restrain a Court of law from exercising its inherent judicial power to inquire into the legal validity of a Constitution, even if its own jurisdiction is conferred by it."
He submitted that the survival and continuation of the Judiciary is relatable to the fact that in each constitutional interruption, there was no allegation of malfunctioning of the Judiciary, rather it was the failure of the political organ of the State which was made the cause of constitutional interruption. Thus, Judiciary stands acquitted in history, but this is not a free acquittal. It is burdened simultaneously with the responsibility to adjudicate and pronounce upon the nature and merits of the change and more importantly the quantum of its legislative capacity. He submitted that the Judiciary must adjudicate all the controversial/thorny issues and the reason is that if the Judiciary were to decline to adjudicate, it may open itself to the charge that although the coup makers did not interfere with the Judiciary, yet it renounced its powers and became dis functional, therefore, judicial abdication will be self-condemnatory and destructive. He submitted that the Judiciary survived in history and must continue to exercise its judicial powers and thereby control, in a significant way, the possible recklessness of the use of the legislative power that has come to vest in the new regime on account of the attending circumstances leading to the change in question. He submitted that since the respondents are claiming legislative power, it is the duty of this Court to place checks on it, inasmuch as,, in the absence of appropriate representative institutions, such power shall remain uncontrolled, unaccountable and, thus, may become arbitrary.
He submitted that another somewhat similar but a priori reason why Judiciary must tie or untie the Gordian knot is that in most societies and particularly. in Pakistan, it is the only forum recognized by both the rulers and the ruled where questions of validity and legitimacy are capable of being resolved finally, controlling the recklessness of the new regime and declining to resolve it would be self-condemnation, self-destructive and betrayal of the trust of the people of Pakistan.
He submitted that any form of oath taken by or administered to the post-coup d'etat Judges can neither restrict the judicial power nor derogate from the legal position that the Courts, as final arbiters in any constitutional controversy, retain their right and jurisdiction to say as to what a particular provision of the Constitution means or does not mean even if that particular provision is one seeking to oust the jurisdiction of the Court itself. He submitted that any attempt to control or circumscribe the judicial power of the Superior Courts with a view to denying them the right to decide the validity and the quantum of legislative power of the new regime, would be an exercise in futility and that let it be known that changing the form of oath will not take away the inherent jurisdiction of this Court to say what a particular provision of the Constitution means or does not mean. He emphasised that notwithstanding the new oath or its language the Courts shall continue to have jurisdiction to decide the question whether the new oath and the "new constitutional document" under which the oath is administered, have any effect on the jurisdiction and power of the Court.
Mr. S.M. Zafar further submitted that learning from the previous change overs, although the draftsman has, in the new prescription of oath, substituted "upholding the 1973 Constitution" with "upholding the PCO" with a view to barring and restricting the Court's jurisdiction yet there is nothing in the oath or inherent in the conditions prevalent today to derogate from the legal position that the validity of the provisions pertaining to the jurisdiction of the Court can be and shall be finally adjudicated upon by the Court. The changes in the language of the oath are merely declaratory and mere recognition of the fact that on October 12, 1999 some transformation did take place. Thus, if the Judges are continuing in office all the time, then any form of oath, any device, any language, any new or different situation will make no difference. It will be an exercise in futility and the final question would be whether the one who prescribed the oath, had the jurisdiction to prescribe it?
He submitted that the Judges of the Superior Courts follow the Code of Conduct for the Judges and inherently owe allegiance to the State of Pakistan, which requires this Court to decide the issue of validity of the new regime under which the Judges are being asked to take new oath, inasmuch as, such allegiance cannot be undone. However, oath administered under the Constitution is something different. According to him, such oath has to be respected because it draws its authority from the people of Pakistan.
He drew a distinction between revolution' andcoup d'etat'. He referred to the definition of the term `coup d'etat' given in Black's Law Dictionary, which is as under: ???
"Coup d'etat.---Political move to overthrow existing Government by force.
"Revolution.-A complete overthrow of the established Government in any country or State by those who were previously subject to it. The word in its broadest significance is generally used to designate a sweeping change as applied to political change, it denotes a change in a method or system of Government, or of the power which controls the Government. It is frequently accomplished by or accompanied by violent acts, but it need not be violent in its methods and it does not necessarily denote force or violence.
He also referred to certain passages from the book titled "A HISTORY OF MILITARISM" CIVILIAN AND MILITARY by Alfred Vagts, to explain the meaning of the term `revolution'.
He submitted that coup d'etat and revolution may be distinguished and differentiated as under:
(i) "A coup d'etat is a sudden seizure of state power by a small segment of the people. Whereas a revolution is preceded by a long gestation/preparation and a sizeable portion of the people participates in the struggle.
(ii)??????? A revolution is aimed at and proclaimed to cause far reaching changes both in the social system and the national legal order. The coup d'etat is respectful and conservative towards the existing national order and seeks to remove certain deficiencies to improve its working.
(iii)?????? A revolution creates new structure out of the ashes of the old one; a coup d'etat subverts that .part of the Constitution which relates to the formation of the political organ with a view to reform it.
(iv)?????? A revolutionary asserts the right to stay, the coup d'etat leadership promises to return the trust to the political sovereign, the people, as soon as possible, and retains the functional framework of the State as well as the judicial branch.
(v)??????? In case of coup d'etat the legitimacy of the new regime is not completely autonomous/independent of pre-existing processes and institutions. The revolution is autonomous and disrespectful towards existing national order and attempts to transform the society altogether.
(vi)?????? Only one common thing which happens historically in the case of both is that an unsuccessful coup as well as unsuccessful revolution is treated as treason."
He also referred to para. 19 of the statement dated 2-5-2000 of Syed Sharifuddin Pirzada, learned Senior ASC, which reads thus
" 19. The intervention is not of a permanent nature, but for a limited period and is of a temporary character to enable the country to return to a true democratic way of life as soon as possible."
Mr. S.M. Zafar, the learned amicus curiae concluded that what happened on 12th October, 1999 was a coup d'etat and not a revolution.
He submitted that the issue of recognition or otherwise cannot be resolved on the basis of recognition accorded by the International community but is to be determined under the Municipal Law. In support of his contention; reliance was placed on Asma Jillani's case (supra).
Reference was also made to the book titled "Recognition of Governments in International Law"-With Particular Reference to governments in Exile by Stefan Talmon wherein it was observed that recognition of governments denotes the act through which it becomes apparent that a State is willing to enter into certain relations with an authority as the Government of a State and/or that, in the opinion of the State, the authority qualifies as a Government in international law.
He submitted that the change on 12th October, 1999, does not claim to be based on the principle of revolutionary legality, hence the principle of Dosso's case is not relevant and Kelsen's theory is not applicable to the facts and circumstances of the present case. The logical conclusion is that the new regime, if it is not a revolutionary regime, cannot claim to be the law giving source and its legislative powers are to be spelt out by the Courts.
He submitted a brief account of the chequered political history of the nation by stating that the country had its legal birth and freedom with the adoption of Government of India Act, 1935 as the Interim Constitution along with the Indian Independence Act, 1947. After nine years, the 1956 Constitution was drafted and promulgated but it was a short lived document as it was abrogated on 7-10-1958. This was followed by the promulgation of the 1962 Constitution on 1-3-1962 which provided for Presidential form of Government. Seven years later, however, this Constitution was also abrogated and was followed by the Laws (Continuance in Force) Order, 1969 as well as the Legal Framework Order, 1970. Later, Interim Constitution of 1972 came into force which was succeeded by a permanent Constitution i.e. the Constitution of 1973 which came into force on 14-8-1973. This was a consensus document and, therefore, the Laws (Continuance in Force) Order, 1977 as well as Proclamation of Emergency and PCO 1 of 1999 merely held it in abeyance. He stated that every time there was a constitutional debacle, the Courts provided an appropriate solution through the application of doctrine of necessity or other formula in order to ensure continuity of the legal system.
In doing so, the judgments of the Court may be divided into two categories, (i) cases in which necessity was pleaded within the framework of an existing Constitution, and (ii) cases in which necessity was pleaded by an intervenor who acted extra-constitutionally. In the first category, the relevant case is that of Muhammad Umar Khan v. The Crown (PLD 1953 Lah. 528) in which military necessity was recognized, while in the second category the Reference by His Excellency the Governor-General (PLD 1955 FC 435) may be referred where civil necessity was spelt out as part of every written Constitution of a civilised people.
?He also referred to the Reference. by the President of Pakistan under Article 162 of the Constitution of Islamic Republic of Pakistan (PLD 1957 SC [Pak] 219), which was rejected by the Court. He also referred to the case of Darwesh M.Arbey v. Federation of Pakistan (PLD 1980 Lahore 206) wherein the military necessity was rejected on the touchstone of 1973 Constitution. He referred to the case of Liaquat Hussain v. Federation of Pakistan (PLD 1999 SC 504) in which both the civil and military necessity were not allowed to be pleaded in violation of the Constitution.
(i)???????? One man cannot act legitimately to amend the Constitution or the law in the absence of Legislature;
(ii)??????? The doctrine of necessity may be applied only to preserve the Constitution;
(iii)?????? There should be a manifest assurance that the Legislative body will soon come into existence;
(iv)?????? That ultimate validation could be conferred by the Legislature and not the Court.
He also referred to the following observations made in the Reference by the President of Pakistan under Article 162 of the Constitution of Islamic Republic of Pakistan (PLD 1957 SC 3 [Pak] 219 at 239):
"And then there is the point, and it is an important point, that if the power to dissolve an interim Provincial Assembly vests in the Governor, a similar power must be conceded to the President in respect of the National Assembly functioning under Article 223. For, a dictatorially minded President, there could be nothing easier than to dissolve the present National Assembly and constitute a new ad hoc Assembly consisting of members of his own way of thinking who by a two-third majority could repeal the whole Constitution and frame a new Constitution to serve their own ends. A legislature returned after an ordinary general election often has a different outlook and legislative bias and a gerrymandered election can certainly produce a completely subservient body. We are not suggesting that any President will act in that manner, but there can be no doubt that on Mr.Manzur Qadir's interpretation of the Constitution such possibility would undoubtedly exist in law."
'158. He further submitted that in the case of Darwesh M. Arbey v. Federation of Pakistan (PLD 1980 Lahore 206) the Lahore High Court rejected the plea of necessity, the same being contrary to the constitutional provisions.
He stated that the case of The Attorney General of the Republic v. Mustafa Ibrahim and others (1964 Cyprus law Reports 195) brought about a distinction between necessity in the case of constitutional breakdown and necessity in the case of overthrow of a constitutional Government. He clarified that in case of breakdown the purpose is to fill in the vacuum arising within the constitutional parameters whereas in the case of overthrow the purpose is to have the Constitution functioning within the national legal order. He added that in case of constitutional breakdown the use of doctrine of necessity within the framework of the Constitution is minimal and. temporary and the Courts in Pakistan have not permitted its use to undermine any provision of the Constitution.
Coming to the constitutional overthrow, he submitted that there is only one case of Begum Nusrat Bhutto v. Chief of Army Staff and Federation of Pakistan (PLD 1977 SC 657), wherein the doctrine of necessity was pleaded and this Court accepted the same by holding that the extra-constitutional action was a deviation dictated by the highest consideration of the State necessity and the welfare of the people. Then the learned Judges proceeded to determine the quantum of the legislative power of the Military regime and while delegating power, they included the power to amend the Constitution. Having done that, this Court further decided to have a supervisory jurisdiction over every action including legislative measures on the premises that the Court would test all of them on the basis of the doctrine of necessity, meaning thereby that the doctrine of necessity would not apply at the initial stage alone, but it will continue to apply as 'long as the necessity persists. Thus, this Court broadened the 1955 ruling in the Governor-General's Reference relating to the State necessity and extended it to an extra-constitutional measure and permitted amendment in the Constitution, which could be interpreted. as a licence to change the Constitution according to the whims of the new regime.
He submitted that the case of Nusrat Bhutto (supra) came up for discussion and was approved in the case of Mahmood Khan Achakzia v. Federation of Pakistan (PLD 1997 SC 426) by majority. The learned amicus curiae argued that Mahmood Khan Achakzai's case highlighted two aspects: (i) that the power of amendment was not extensive and it was deviated from by the then regime, and (ii) that the issue of time-frame was reviewable. He submitted that the above two flaws pinpointed in Mahmood Khan Achakzai's case need to be rectified by this Court.
He submitted that the doctrine of necessity applied in Governor?-General's Reference (supra) insisted on a call to the electorate and that too in a very limited time-frame' i.e. one and a half month whereas in Nusrat Bhutto's case it was left to expectations, therefore, in case validation is granted in this case, a realistic time-schedule may be obtained from .the Government through the Attorney-General and determined and/or finalised by the Court itself. He emphasised that in the light of the past experience, particularly in the aftermath of Begum Nusrat Bhutto's case when the time frame was stretched to unusual limits, the issue should not be left to mere commitments. He added that in case a time-frame is not determined, injustice will be done to national legal order, therefore, in view of the law laid down in the cases of Fauji Foundation, Asma Jilani, Begum Nusrat Bhutto and Mehmood Khan Achakzai (supra), it is the duty of this Court to see that national legal order is disturbed the least.
Regarding causes of military intervention in a country, the learned amicus curiae referred to the following passages of the book titled `The Man on Horseback' The Role of the Military in Politics by S.E. Finer wherein it has been said:
"The causes which produce military intervention in politics ....lie not in the nature of the group but in the structure of society. In particular, they lie in the absence or weakness of effective political institutions in the society."
THE PERFORMANCE FAILURES OF CIVILIAN GOVERNMENTS
"Praetorians invariably charge the civilian Governments whom they have overthrown with serious performance failures. Unconstitutional and illegal behaviour (especially widespread political corruption), responsibility for economic downturns or inflationary spirals, and an inability to handle political opposition and discontent without their erupting into disorderly and violent actions-these are the three most frequent performance failures used to justify the overthrow of civilian Governments. These charges commonly correspond to the reality of the situation, thereby making it all the easier for the praetorians to rationalise and justify their actions on behalf of Constitution and nation."
"With regard to the first type of performance failure, the praetorians charge the civilian incumbents with various unconstitutional and illegal acts. These include the arbitrary application of the laws, the extension of their powers into areas that are prohibited by the .Constitution, the retention of their offices beyond the constitutionally prescribed limits, and by far the most frequent accusation, the flouting of legality in permitting or engaging in widespread corruption. Higher and lower governmental officials are charged with the outright pilfering of public funds, the granting of benefits and exemptions to political supporters, the sale of favours, and the acceptance-of kickbacks from contractors. The illegally acquired funds are used not only to enrich those who already have official positions but also to help ensure their continuation in office by financing party activities, patronage networks, and electoral campaigns. Since accusations of corruption are made far more often than other charges of unconstitutional and illegal behaviour, we shall concentrate on the connections between these and military intervention."
"According to the praetorians themselves, their coups are inspired by the goal of political regeneration, eliminating venal practices and guaranteeing adherence to high standards of public honesty. Several; writers on the non-Western military have referred to its "puritanical" outlook and ascetic standards. "The military demands these qualities not only for itself, but for society as a whole, and it sets itself up as a standard-bearer of hard work and unflinching dedication" (Janowitz, 1964, p.64; Shils, p.24; Shils, p.24; Pauker, p.339). Luckham agrees with this generalization and suggests that the puritan ethic was of some importance in motivating the majors to carry out the first Nigerian coup (Luckham, pp.230, 282-83). Under civilian rule Nigeria certainly exhibited an inordinate amount of political corruption, whether gauged in terms of the diversity of corrupt practices, the number of politicians who engaged them, or the high offices that they occupied. The politicians regarded the illegal translation of authority into profit, power, and party advantage as acceptable perquisites of public office."
"Although soldiers are occasionally motivated to overthrow civilian governments because their poor economic performance has adverse consequences for the middle class, there are two other connections between this kind of performance failure and intervention that have a more frequent and greater impact upon the decision to intervene. Economic performance failures can only solidify and intensify the military's disrespect for the incumbents, heightened further by the belief that as highly competent professional officers, they could turn in a far better performance as economic decision makers. And the notable impact of economic performance failures upon the loss of governmental legitimacy goes a long way in facilitating the ' translation of motives into coup attempts."
"CORRUPTION"
"If the spirit of liberty is so strong, why do free nations and enterprises fall, and dictators arise from their ruin? Machiavelli lays the blame on corrupt leaders, and then the corruption of the people themselves. "To usurp supreme and absolute authority ....in a free state, and subject it to tyranny, the people must have already become corrupt by gradual steps from generation to generation." Once that has happened, the enterprise is probably doomed. Free societies depend upon the virtue of the people; there is a symbiotic relationship between the good laws and institutions upon which the enterprise rests, and the virtuous behavior of the citizens. Just as "good laws are necessary to maintain good customs, so good customs are necessary for good laws to be observed."
"Weaken the one, and the other slides down into corruption, with terrible consequences: the indolence and selfishness that destroys even the greatest human achievements. Once the rot sets in even the finest institutions are useless. "Neither laws nor constitutional systems are sufficient to rein in a general corruption."
The learned amicus curiae also referred to the following passages of his own book titled "THROUGH THE CRISIS":
"MAN ON HORSEBACK"
"The Military in a country only intervenes in political crisis according to the occasion and its disposition. Its dispostion is inhibited by many factors, the foremost factor being the explicit and well accepted principle that the supremacy of the civil aspect of the government should be always observed. In fact many times that the Army had interfered in civil affairs, they had found that they were inadequately equipped for running a civil Government and this experience has been accepted over a long period as the reason for not taking over the civil Government by the Military."
"Secondly, the professionalism of the Army is a vitally inhibiting factor."
"Reverting to the disposition and the occasion for interference, the situation in the country as a whole at any particular time may determine the disposition. The lowering of international prestige of a nation or the fear that the country would face serious law and order problem have been the causes of moving the Army towards internal action: the power vacuum in the country, like the absence of political organizations have also been a cause of providing opportunity to interfere, particularly when the intervention is provided by the civilians."
"Let me make it very clear that so long as there is a political vacuum in the country and institutions do not start functioning, in spite of the .natural inhibition of Armed Forces to interfere in the affairs of the country, the occasions for it to interfere in civil Government may arise again and again."
Mr. S. M. Zafar, learned amicus curiae submitted that in case validation is given to October 12, 1999 action, then except for the Proclamation all other subsequent instruments including the PCO should be made subject to judicial review. '
Finally, he summed up his arguments as follows:
(i)-?????? The doctrine of necessity was earlier allowed only for the purpose of preservation of the Constitution for a very limited time and only on being assured that there will be representative assembly. If it is to be extended, it should be on positive assurance, programme, formula for the earliest possible.
(ii)??????? The Proclamation of Emergency alone can be justified under the doctrine of necessity, but not the subsequent PCOs.
(iii)?????? The new oath of the Judges under the PCO does not curtail jurisdiction of this Court to determine the validity of the PCO.
(iv)?????? Whatever be the social causes for the military to come, the Armed Forces should go back to their professionalism and defend the borders of the country. The loopholes in Begum Nusrat Bhutto's case as have been pointed out in Mahmood Khan Achakzai's case should be plugged.
SUBMISSIONS OF THE ADVOCATES GENERAL OF THE PROVINCES
The learned Advocate-General Punjab adopted the arguments addressed by the learned Attorney-General and further submitted that appropriate changes in the Constitution/laws should be brought about so as to avoid frequent recurrence of Military intervention and that the present ,Government should be facilitated to achieve its declared objectives.
The learned Advocates-General of N.-W.F.P., Sindh and Balochistan also adopted the arguments of the learned Attorney-General.
SUBMISSIONS OF MR. KADIR BAKHSH BHUTTO, VICE-CHAIRMAN, PAKISTAN BAR COUNCIL
SUBMISSIONS OF MR. ABDUL HALEEM? PIRZADA, PRESIDENT, SUPREME. COURT BAR ASSOCIATION.
Mr. Abdul Haleem Pirzada, President, Supreme Court Bar Association submitted that this country is facing this dilemma for the fourth time. Judiciary-has always been put to test in these cases, the reason being that this is the only institution which has not been affected by all adventures. The Federation has been justifying the action from the facts that on that particular date, i.e. 12th of October, 1999 the Chief of Army Staff was coming back from Sri Lanka; his plane was directed to land either in India or get crashed. It was contended that the above assertion is incorrect. lie argued that the impugned action was resorted to only when the Chief of the Army Staff was removed but this is not a valid ground for the take-over.
He submitted that the nation has already suffered a lot on account of Military adventurism and it is for this Court to guard the country against it. He pleaded that the people have confidence in this Court and they hope that it will save them from this malady. He submitted that the charge of corruption against few people cannot deprive the people of Pakistan from their legitimate right to rule themselves through their elected representatives. He submitted that the people do make mistakes but, for-the mistake of few, the entire nation should not be punished. He submitted that though it may not be wholly possible to find 'out any formula against Army intervention in a situation like the present one but an endeavour must be made by taking a step with a view, to forestalling its recurrence.
He submitted that corruption is rampant but such situation hardly constitutes a valid ground for intervention.
He further, submitted that it is a sad commentary that previous Governments, both Civil and Military, had taken the apex Court as a parallel government and hoped that the present regime does not commit such a mistake. He submitted that democracy must be restored at the earliest and the Armed Forces-should be made to go to the Barracks within a year from now. He further argued that the case of Moulvi Tamizuddin was not decided by the Federal Court on correct premises.
Mr. Haleem Pirzada submitted that the Judges of this Court who have taken oath have a greater responsibility. Those who did not take the responsibility, have nothing to worry and the entire burden is on this Court to discharge its duties and perform its functions in accordance with the Constitution and the law. He argued that the Constitution is not a limb of the body but a soul which must survive.
Mr. Haleem Pirzada strenuously criticised the submission made on behalf of the Federation that if the Army thought that there were reasonable basis for concluding that the existence of the State and its sovereignty were at stake, the Court would not substitute their judgment for that of the Army. He argued 'that this Court, saddled with the power of judicial review, is the only and proper forum where such questions can be raised and adjudicated upon. He submitted that Mr. Sharifuddin Pirzada was clear on this aspect of the case and, was right in saying that this Court has the power of judicial review.
On the doctrine of State necessity, Mr. Haleem Pirzada argued that if it is not dead, it should be made to die and buried so deep that it should not come up again because the country has suffered a lot on that account. He submitted that State necessities are always there; but to justify Army take over under this doctrine will not be justifiable and this should be stopped for all times to come.
He submitted that there are two groups of Judges; (i) who have not taken oath and (ii) who have taken oath. Those who have not taken the oath, they are sitting in their homes. Now it is for the Judges of this Court to lay down and make the common man understand that it was in the larger. interest of the country that they took oath according to their conscience to save the country from further collapse and to save its political structure. He argued that 'Adl' is the corner stone in Islam and the hallmark of Islamic society is fiercely independent Judiciary.
Before concluding his arguments, he reiterated that the Court may consider to allow twelve months' time to the Armed Forces from now so that they can do the cleansing and go back to their Barracks.
DR. FAROOQ HASAN, BAR-AT-LAW, LAHORE HIGH COURT BAR ASSOCIATION
Petitioner had contended that (a) 12th October, 1999, Army takeover had destroyed the democratic system in the country, and (b) that the Proclamation of Emergency and the Provisional Constitutional Order of 14-10-1999 were ultra vires of the Constitution.
On the other hand the' Respondent Federation had responded by asserting that (a) there was no genuine democracy in the country prior to 12-10-1999, (b) the Armed Forces had acted to save the people and the country from further damage of great proportions of immense damage as the major-institutions of the Republic had been systematically destroyed by the former Prime Minister by altering the Constitution, and (c) in the circumstances the Court may adopt the 1971 ratio of the Nusrat Bhutto's case and validate the said army action of 12-10-1999.
1.???????? There was increasing disillusionment with the feigned democracy that was established after 1985. Hence, there was genuine public acceptance of the change that emerged on 12-10-1999. Neither there was any public mourning nor protests at the ouster of the previous regime to manifest substantial opposition from the people of the country.
2.???????? Clearly the Proclamation of Emergency was in violation of the Constitution of 1973. The question is, therefore, can it be conditionally validated as was done by this Court in 1977, or is it that such validation must be further subjected to the criteria laid down by this Court in later decision in 1997 and 1999 ?
3.???????? Whether apart from the perspective of established precedents in this field by our Courts, there are well recognized realities and guidelines from similar situations which have undergone coups d'etat?
4.???????? Given the current state of realities, what. is the "best" possible solution with which the Court can provide the country with much needed guidance for future in its judgment?
There have been 5 general elections in 12 years. In 1985 merely 54 % of the country's population participated in the general elections and by 1997 the figure had fallen to 35 % . This would mean that the people have lost faith in elections, they are not interested because as has been held in Nawaz Khokhar's case, the four Governments were accused of corruption and that without accountability of public office holders, there is no question of responsibility.
It was argued on behalf of the petitioners that for the fault of Nawaz Sharif, the Senate and the Assemblies should not be punished. The argument is totally misplaced because in parliamentary democracy the leader of the House, the Prime Minister, commands the majority of the National Assembly, therefore, if the Prime Minister is corrupt, it cannot be said that his colleagues are divorced from it.
In relation to the question, why do Martial Laws come, the following factors have a direct bearing on the issue: -
i)????????? Political instability;
ii)???????? Economic factor;
iii)???????? Lack of education;
iv)??????? Absence of means of redress;
v)???????? Lack of general confidence in the welfare of the country;
vi) ?????? Absence of sense of belonging.
He submitted that what we have in Pakistan, is not democracy, it is only oligarchy. There are 787 members in the elected chambers. If a list of their assets were to be published, they will probably control the whole of Pakistan. This is the perpetuation of oligarchy. If elections are held, the same gentlemen will walk in. Therefore, there should be first cleansing of these 787 plus 2000 sitting under their wings.
He disagreed with the distinction made by Mr. S.M. Zafar between
coup d'etat' andrevolution' and argued that 'coup d'etat' is a French term, which means, cutting of the State. It is a change over from one legal order to another. He referred to an Article titled, "Juridical critique of successful treason" published in the "Stanford Journal of
International Law", . relevant passages whereof are given below:-
"Coup d'etat: Definition and Concept
"Illegal leadership change may or may not be accompanied by, or be the result of, a use of force by the new leaders against the incumbents they replaced. When governmental change through the use of force takes place a "revolution" or "coup d'etat" is said to occur. However, for the purpose of this paper, coups d'etat are to be distinguished from revolutions. The distinction will be observed because the cases to be analyzed hereinafter involved a change of governmental authority without bloodshed. The phrase "coup d'etat" better describes such occurrences. 'Revolution ...involves the rapid, tearing down of existing political institutions and building them anew on different foundations." This definition clearly implies that existing institutions are rapidly and forcibly substituted one for another. Thus, upheaval in the social order of that particular state is quick and violent, much like a civil war. The bloodshed and violence envisaged in such a metamorphosis and transformation is broad and affects the entire state.
"Our attention, on the other hand, is on the political change which is narrowly confined, and ususally very swift. One social scientist, Hannah Arendt, underscored this distinction when she said:
"Coups d'etat and palace revolutions, where power changes from one man to another, from one clique to another, depending upon on the form of government in which the coup d'etat occurs have been less feared because of the change they bring about is circumcised to the sphere of Government itself and carries a minimum of unquiet to the people at large"
"By defining coup d'etat in this manner, Arendt points out that the change is not to the society as a whole, but merely a change in the leadership of the Central Government. Implicit in this definition is the notion that violence and bloodshed are absent or miniscule when power is exchanged by the mechanism of a coup d'etat. Therefore, coups d'etat do not usually bring about the broad changes associated with revolutions, and the existing institutions of the Government and of that society in general normally are left untouched."
He concluded that the two terms, coup d'etat' andrevolution' are interchangeable.
He submitted that there is not a single case in which the Court sent the regime back and that some of the Latin American systems even do not allow the Courts to adjudicate upon such controversies. He concluded that the action of 12th October is covered by the pronouncement of 1977 plus other cases decided by this Court.
ARGUMENTS OF MR. SHAHID ORAKZAI
At the end of his arguments, Mr. Shahid Orakzai gave his formulations, which are as under:-
??????????? FORMULATIONS OF SHAHID ORAKZAI
1.???????? A dispute between any two persons professedly acting under their Constitutional oaths cannot be resolved without a ruling first as to which one of them acted in accordance with or otherwise of the Constitution.
2.???????? Anyone guilty of violating the Constitution/Oath is not entitled to any relief before being penalized for the same. In principle, relief is always due to the one who has suffered.
3.???????? Though the derailment of the Constitution was caused by a conflict, apparently, within the Federal Executive, the National Assembly, being the mother House of the Federal Executive, is very much a party to the dispute. Therefore, the collective conduct of the National Assembly ought to be examined by this Court before granting any relief to any of its members.
4.???????? Any interpretation of Article 63(1)(a) of the Constitution that gives total control to the leadership of a party, ruling the Federation, over a Provincial Executive of the same party, would contravene the federal structure of the Islamic Republic of Pakistan. In view of the above, any Provincial Assembly that failed to check the unconstitutional Federal interference/negative influence over the Provincial Executive, too, is not entitled to any relief. By the Constitution, any legislature to which a cabinet is collectively responsible is legally inseparable from a dispute involving the conduct/misconduct of the cabinet. A mother willfully ignoring the constant misbehavior of her child must ultimately face the music.
5.???????? The Constitution of Pakistan is flexible enough to contain the prevalent crisis and, therefore, the Provisional Constitution Order, a bypass opted in rush by the Chairman Joint Chiefs of Staff Committee just after the mishap, is unnecessary.
6.???????? The plan for the restoration of the Constitution, to be evolved in these proceedings should involve the suspension of minimum provisions of the document, preserve/maintain Constitutional contingencies, stand as close as possible to the Emergency Provisions spelt out- in Part X and adhere to the fundamental principles of the Constitution in the transitional period than attempting to restore the full document by a single stroke of pen in the shortest possible time. A correct diagnosis and a gradual recovery, through a time consuming therapy that uproots a disease, is better than the fastest painkiller.
CONSTITUTION PETITION NO. 3 OF 2000
Mr. Fazal Elahi Siddiqui, learned ASC, petitioner argued with vehemence that Army had no locus to dislodge Civil Rule thrice, including the present take-over. He sought to draw a distinction between the role of the Armed Forces of Pakistan and those of India, who have much in common. In this connection, he placed reliance on 2-Books titled 'The Indian Army' and `The Pakistan Army' written by Stephen P. Kohento contend that eversince partition of the sub-continent, the Indian Army has remained within its bounds and has not interfered with the affairs of the Government. According to him, this comparative situation is in itself sufficient for withholding validation of Army take-over on 12-10-1999.
He contended that the doctrine of necessity is not applicable to the facts and circumstances of this case and the new oath impinges on the independence of Judiciary.
SPED ZAFAR ALI SHAH. ASC
PETITIONER IN CONSTITUTIONAL PETITION N0.62 OF 1999
Syed Zafar Ali Shah, petitioner submitted in rebuttal that the Court is dealing with two philosophies, two different thoughts and two old litigants namely political democracy and Military authoritarianism. According to him, during arguments much has been said against the democracy, particularly against politicians as also the Parliament. Being a sitting Member of Parliament he had the privilege to move the motion against Article 58(2)(b) of the Constitution. It has been argued by the learned Attorney-General that 13th Amendment was passed in 13-minutes. This assertion is not correct. In fact it took more than 13 years to get rid of 8th Amendment which was passed in 1985.
He further submitted that same is the position with regard to 14th Amendment which was brought about with a view to putting an end to floor crossing/Lota'ism. Further, there is no substance in the allegation that the former Prime Minister stood to gain from it in that the power conferred by the amendment vests in the leader of the political party concerned.
MR. IOBAL HAIDER, PETITIONER
Syed Iqbal Haider, petitioner in Constitution Petition No. 57 of 1999, submitted that the Proclamation of Emergency and PCO 1. of 1999 are not extra-constitutional steps, in that, they are in accordance with the Constitution in the light of Article 2-A thereof. Reliance is placed on Ziaur Rehman's case (PLD 1973 SC 49 at 71). He further submitted that this Court has inherent powers of judicial review under the Islamic Injunctions as laid down in the case of Mrs. Benazir Bhutto (PLD 1988 SC 416 at 522-UU).
On the question of applicability or otherwise of the doctrine of necessity he referred to the cases of Asma Jillani, Nusrat Bhutto and Liaqat Hussain (supra) wherein the parameters of this doctrine have been laid down.
He submitted that the parliamentarians who made contemptuous speeches in the National Assembly against the Judges of the Superior Courts violated the provisions of the Constitution specifically prohibiting discussion with respect to the conduct of any Judge of the Supreme Court or of a High Court in the discharge of his duties and that they ignored the decisions of the Supreme Court in this regard despite the fact that certain members pointed out those decisions at the floor of the House. He referred to PLD 1989 SC 166 at 184, wherein this Court considered the debate of Parliament while interpreting the Constitution.
Mr. Iqbal Haider contended that new oath under Oath of Office (Judges) Order No. 1 of 2000 has not been taken by the Judges to accept the change of Government, rather it relates to the change of legal order.
He submitted that the deletion of Article 58(2)(b) is against the spirit of the Constitution, which should be revived so that checks and balances are provided in the Constitution for its successful working. In this behalf he placed reliance on PLD 1998 SC 1263 at 1310 H, 1356.
He submitted that the quota system is against the Injunctions of Islam and with the passing of the 16th Amendment, the members have become disqualified for violating the Injunctions of Islam under Article 63(1)(g). Reliance is placed on 1997 SCMR 1043 at 1057 and 1059:
He submitted that the allegation' that all the Elected Members had been reduced to rubber stamps by the former Prime Minister is against the Parliament and not against the Provincial Assemblies and in particular the Provincial Assembly of Sindh, which had been allowed to perform to its legislative functions in -the case reported as Jalal Mahmood Shah (supra). He therefore,, prayed that the Provincial Assembly of Sindh merits restoration.
MR. IMTIAZ HUSSAIN BOKHARI
199: Mr. Imtiaz Hussain Bokhari, petitioner in 66 of 1999, submitted that the impugned action of 12th October, 1999 is the result of tussel between two individuals viz. General Pervez Musharraf and Mian Nawaz Sharif and does not relate to the whole of the Armed Forces of Pakistan, inasmuch as, the former was retired by the latter.
?200. He submitted that all the four military leaders, Ayub Khan, Yahya Khan, Ziaul Haq and Pervaiz Musharraf used the same pretext for usurping power as is obvious from the terminology employed in their respective first addresses to the nation., 201. On the question of power of the Prime Minister to order retirement of the Chief of Army Staff, he relied on the instances of removal of Khalid Bin Walid and Muhammad Bin Qasim to contend that the order retiring Gen. Pervaiz Musharraf is not open to exception on the touchstone of the Constitution as well as the above historical instances.
INDEPENDENCE OF JUDICIARY
AND
POWER OF JUDICIAL REVIEW
Before we embark upon the task of dealing with the merits of the case in the light of the arguments advanced on behalf of the parties, it would be appropriate to dilate on the question of jurisdiction of this Court especially in view of the fact that the Judges of the Superior Courts have taken new oath of their offices under the Order No. 1 of 2000 promulgated by the Chief Executive under the PCO 1 of 1999. The basic question, which needs to be resolved is whether the restriction imposed by the PCO 1 of 1999 on the jurisdiction of this Court does in any way restrict the power of judicial review of this Court whereunder it has an inherent power to A interpret any provision of the Constitution or any other legislative instrument or law, even if that particular provision' is a provision which seeks to oust the jurisdiction of this Court.
M/s. Khalid Anwar and Ch. Muhammad Farooq, learned counsel for the petitioners in C. Ps. Nos. 63 and 62 of 1999 respectively addressed exhaustive arguments on the power of judicial review as well as on the question of maintainability of the petitions. Mr. Habib-ul-Wahab-ul-Khairi's arguments mainly related to the maintenance and upholding of independence of Judiciary. Syed Sharifuddin Pirzada, learned Senior ASC for the Federation candidly conceded that the power of judicial review is intact notwithstanding the ouster clauses in the impugned instruments. Mr. S.M. Zafar, learned amicus curiae also contended that all the legislative instruments promulgated by the Chief Executive are subject to scrutiny by this Court for determination of the present controversy. Likewise, Mr. Haleem Pirzada, President, Supreme Court Bar Association advocated the independence of Judiciary and the power of judicial review. On this aspect of the case similar stance was presented by Dr. Farooq Hasan, representing the Lahore High Court Bar Association. However, Mr. Aziz A. Munshi, learned Attorney-General for Pakistan, expressed his reservations about the maintainability of the petitions and pleaded ouster of jurisdiction of this Court by means of the Proclamation of Emergency as also the PCO 1 of 1999.
We have examined the scope of the power of judicial review and the question of maintainability of the petitions in the light of the arguments addressed by the petitioners themselves, the learned counsel for the parties and the other learned counsel appearing in the case. Judiciary is the only forum recognized by both the rulers and the ruled where: (1) questions of validity and legitimacy are capable of being resolved finally with a view to controlling the recklessness of the Government in power and where (2) declining to resolve it would tantamount to self-condemnation, self? destruction and betrayal of the trust of the people of Pakistan. It is the unanimous stand of the learned counsel for the parties and we also endorse it that no form of oath taken by or administered to the Judges of the Superior Courts can restrict the judicial power and derogate from the legal position that the Courts, as final arbiters in any constitutional controversy, retain their power and jurisdiction to say as to what a particular provision of the Constitution or the law means or does not mean even if that particular provision is one seeking to oust such jurisdiction of the Court. An analysis of the case law relating to ouster of jurisdiction of this Court shows that any attempt to control or circumscribe the judicial power of the superior Courts with a view to denying them the right to decide the validity and the quantum of legislative power of the new regime, would be an exercise in futility. We are of the considered view that changing the form of oath will neither take away power of judicial review nor the jurisdiction of this Court. Notwithstanding the new oath or its language, the Courts shall continue to have jurisdiction to decide the controversy involved as if the new oath and the "new constitutional documents" under which the oath is administered, do not adversely affect the jurisdiction and power of the Court. It is pertinent to note that the Superior Courts follow the Code of Conduct prescribed for the Judges and inherently owe allegiance to the State of Pakistan, which requires this Court to decide the issue of validity of the new regime under which the Judges are being asked to take new oath inasmuch as such allegiance cannot be taken away. Mr S.M. Zafar rightly pointed out that the oath administered under the Constitution has to be respected because that draws its authority from the people of Pakistan whereas the oath under the Constitution to defend the same has a different meaning than an oath administered under a document, validity whereof is yet to be determined and thus the two are incomparable.
The Objectives Resolution contained in the Preamble to the Constitution, which now. forms substantive part thereof by virtue of Article 2A as well as declaration of Quaid-e-Azam about democratic set-up and social justice, envisage independence of Judiciary.
First of all, reference may be made to Sura Al-Nisa, Verses 135?136 English rendering whereof by Allama Abdullah Yousaf Ali reads thus:-
"O Ye who believe!
Stand out firmly
For justice, as witnesses
To Allah, even as against
Yourselves, or your parents, Or your kin, and whether
It be (against) rich or poor;
For Allah can best protect both
Follow not the lusts
(Of your hearts), lest ye
Swerve, and if ye?????????
Distort (justice) or decline
To do justice, verily
Allah is well-acquainted
With all that ye do."
The footnote to the above translation is as under:
"Justice is God's attribute, and to stand firth for justice is to be a witness to God, even if it is detrimental. to our own interests (as we conceive them) or the interests of those who are near and dear to us. According to the Latin saying, "Let justice be done though heaven should fall."
"But Islamic justice is something higher than the formal justice of Roman Law or any other human law. It is even more penetrative than the subtler justice in the speculations of the Greek philosophers. It searches out the innermost motives, because we are to act as in the presence of God to Whom all things, acts, and motives are known."
"Administration of Justice is a decisive ordinance of God and (of? the Prophet (p.b.u.h.) which must be followed."
"Decide after careful consideration (and execute it), if a suit is filed before you; for the announcement of a rightful judgment without its execution is useless."
"Use your brain about matters that perplex you and to which neither the Qur'an nor the Sunnah of the Holy Prophet (p.b.u.h.) seem to apply. Study similar and analogous cases and evaluate the situation through analogy and adopt the judgment which is most pleasant to God and most in conformity with justice so far as you can see."
"1.??????? The Judiciary is an institution of the highest value in every society.
2.???????? The Universal Declaration of Human Rights (Art. 10) and the International Covenant on Civil and Political Rights (Art. 14(1) proclaim that every one should be entitled to a fair and public hearing by a competent, independent and impartial tribunal established by law. An independent Judiciary is indispensable to the implementation of this right.
3.???????? Independence of the Judiciary requires that;
(a)??????? the Judiciary shall decide matters before it in accordance with its impartial assessment of the facts and its understanding of the law without improper influences, direct or indirect, from any source; and
(b)??????? the Judiciary has jurisdiction,, directly or by way of review, overall issues of a justiciable nature.
"33. The Judiciary must have jurisdiction overall issues of a justiciable nature and exclusive authority to decide whether an issue submitted for its decision is within its competence as defined by law.
34.?????? The jurisdiction of the highest Court in a society should not be limited or restricted without the consent of the members of the court." (The underlining is by way of emphasis)
The independence of Judiciary is a basic principle of the constitutional system of governance in Pakistan. The Constitution of Pakistan contains specific and categorical provisions for the independence of Judiciary. The Preamble and Article 2A state that "the independence of Judiciary shall be fully secured"; and with a view to achieve .this objective. Article 175 provides that "the Judiciary shall be separated progressively from the executive". The rulings of the Supreme Court in the cases of Government of Sindh v. Sharaf Faridi (PLD 1994 SC 105, Al-Jehad Trust (supra) and Malik Asad Ali v. Federation of Pakistan (PLD 1998 SC 161), indeed, clarified the constitutional provisions and thereby further strengthened the principle of the independence of Judiciary, by providing for the separation of Judiciary from the executive, clarifying the qualifications for appointment of Judges of the High Courts, prescribing the procedure and the time frame for appointment of Judges, appointment of Chief Justices and the transfer of a Judge from a High Court to the Federal Shariat Court. Furthermore, the Supreme Court judgments in the cases of Mehram Ali and Liaquat Hussain (supra) are also in line with the above rulings, in as much as, they elaborated and reiterated the principle of judicial independence and the separation of Judiciary from the executive.
In a system of constitutional governance, guaranteeing Fundamental Rights, and based on principle of trichotomy of powers, such as ours, the Judiciary plays a crucial role of interpreting and applying the law and adjudicating upon disputes arising among governments or between State and citizens or citizens' inter se. The Judiciary is entrusted with the responsibility for enforcement of Fundamental Rights. This calls for an independent and vigilant system of judicial administration so that all acts and actions leading to infringement of Fundamental Rights are nullified and the rule of law upheld in the society.
The Constitution makes it the exclusive power/responsibility of the Judiciary to ensure the sustenance of system of "separation of powers" based on checks and balances. This is a legal obligation assigned to the Judiciary. It is called upon to enforce the Constitution and safeguard the Fundamental Rights and freedom of individuals, To do so, the Judiciary has to be properly organized and effective and efficient enough to quickly address and resolve public claims and grievances; and also has to be strong and independent enough to dispense justice fairly and impartially. It is such an efficient and independent Judiciary which can foster an appropriate legal and judicial environment where there is peace and security in the society, safety of life, protection of property and guarantee of essential human rights and fundamental freedoms for all individuals and groups, irrespective of any distinction or discrimination on the basis of cast; creed, colour, culture, gender or place of origin, etc. It is indeed such a legal and judicial environment, which is conducive to economic growth and social development.
During the course of arguments on the question of judicial review, Syed Sharifuddin Pirzada. respectfully adopted the observations made by one of us (Irshad Hasan Khan, CJ) while delivering the inaugural address to? the Conference of Board of Directors, Asian Ombudsmen Association held at Islamabad on 22nd February, 2000, which reads thus:
"The independence of Judiciary requires that the Judiciary shall decide matters before it in accordance with its impartial assessment of the facts and its understanding of the law without improper influences, direct or indirect, from any source. The Judiciary in Pakistan is independent. It claims and has always claimed that it has the right to interpret the Constitution and any legislative instrument and to say as to what a particular provision of the Constitution or a legislative instrument means or does not mean, even if that particular provision is a provision seeking to oust the jurisdiction of the Supreme Court.".
"The complete independence of the Courts of justice is peculiarly essential in a limited Constitution. By a limited Constitution, I understand one which contains certain specified exceptions to the legislative authority; such, for instance, as that it shall pass no bills of attainder, no ex post facto laws, and the like. Limitations of this kind can be preserved in practice no other way than through the medium of Courts of justice, whose duty must be to declare all acts contrary to the manifesto tenor of the Constitution void. Without this, all the reservations of particular rights or privileges would amount to nothing."
"This independence of the Judges is equally requisite to guard the Constitution and the rights of individuals from the effects of those ill humors which the arks of designing men, or the influence of particular conjunctures, sometimes disseminate among the people themselves, and which, though they speedily give place to better information, and more deliberate reflection, have tendency, in the meantime, to occasion dangerous innovations in the government; and serious. oppressions of the minor party in the community. Though I trust the friends of the proposed Constitution will never concur with its enemies in questioning that fundamental principle of republican government which admits the right of the people to alter or abolish the established Constitution whenever they' find it inconsistent with their happiness; yet it is not to be inferred from this principle that the representatives of the people; whenever a momentary inclination happens to lay hold of a majority of their constituents incompatible with the provisions in the existing Constitution would, on that account, be justifiable in a violation of those provisions; or that the Courts would be under a greater obligation to connive at infractions in this shape than when they had' proceeded wholly from the cabals of the representative body. Until the people have, by some solemn and authoritative act, annulled or changed the established form, it is binding upon themselves collectively, as well as individually; and no presumption, or even knowledge of their sentiments, can warrant their representatives in a departure from it prior to such an act. But it is easy to see that it would require an uncommon portion of fortitude in the Judges to do their duty as faithful guardians of the Constitution, where legislative invasions of it had been instigated by the major voice of the community."
"Judicial review, must, therefore, remain strictly judicial and in its exercise, Judges must take care not to intrude upon the domain of the other branches of Government. "
Judicial power means that the Superior Courts can strike down a law on the touchstone of the Constitution, as this Court did in Mehram Ali's and Sh. Liaquat Hussain's cases. The nature of judicial power and its relationship to jurisdiction are all allied concepts and the same cannot be taken away. The concept of judicial review was laid down in the United States by Chief Justice John Marshal in the case William Marbury v. James Medison (2 Law Ed. 60), ruling that it was inherent in the nature of judicial power that the Constitution is regarded as the supreme law and any law or act contrary to it or infringing its provisions is to be struck down by the Court in that the duty and function of the Court is to enforce the Constitution. The concept of judicial review did not exist in England because the supreme law in England was that the Queen-in-Parliament can do anything and that once an Act of Parliament has been passed, the Courts were to follow it. The Founding Fathers of the United States Constitution, however, deviated from it and in doing so followed the view expounded by Montesquieu in his treatise "Spirit of Law", which enumerates the concept of Separation of Powers: the judicial, the legislative and the executive powers. Montesquieu based his opinion on the practice but not the law of England, in that, in practice there was Separation of Powers in England but not in theory. Unlike the Constitution of Pakistan, the Constitution of United States does not confer any power on the Supreme Court to strike down laws but the Supreme Court , of United States ruled so in the case of William Marbury v. James Medison (supra).
We have examined the contention of the learned Attorney-General that after having taken oaths of their offices under the PCO as amended, the Judges of the Superior Courts are bound to defend the Proclamation of Emergency and the PCO as amended, in that, the old Constitution has been replaced by a new revolutionary order on the basis of the verdict earlier given by this Court in the case of Begum Nusrat Bhutto (supra). We are afraid the contention is totally misconceived in that it was clearly stated in the above judgment that on no principle of necessity could powers of the judicial review vested in the Superior Courts under 1973 Constitution be taken away. It was further observed that the old order has not been replaced k by a new order but it was merely a case of constitutional deviation for a temporary period to enable the Chief Martial Law Administrator to restore democratic institutions and hold elections at the earliest.
218, Reference may also be made to the book titled "Principles of Revolutionary Legality" by J.M. Eekelaar wherein the author observed that the Court must take into account before determining the legitimacy of a revolutionary regime, the two oblique arguments, which would attempt to undermine it: one relating to collapse of its jurisdiction with the disappearance of the old Constitution; and the other relating to subservience of the Judiciary to the new regime. It would be advantageous to quote the relevant passages from the aforesaid book, which read thus:
Authority of the Court
"In concluding the defence of the proposition that principles of the kind enumerated above may properly be taken into account by a Court in order to determine whether or not to uphold the legitimacy of a revolutionary regime, it is necessary to consider two oblique arguments which would attempt to undermine it. One is to take theoretical objection to the jurisdiction of a Court which indulges in the exercise. The claim is that, as the Court acquired its authority to determine disputes by virtue of jurisdiction conferred on it by the old Constitution, the disappearance of that Constitution implies the collapse of the Court's own authority. The other argument is the severely practical one that, whatever the legal theorist or the Judges may say, any court making a finding adverse to a revolutionary regime is certain to be disbanded so that in reality a judiciary will be allowed to function only if it is subservient to the new regime.
"The second questionable premises is that by suffering the Court to continue to function, the new executive thereby assimilates the court into its own revolutionary order and that this compels the de jure recognition of the Government. But against this it might be urged that the very submission by the revolutionaries to litigation before the Court concerning their own legitimacy suggests that the Court may have an inherent authority arising from the submission of both parties, rulers and ruled, to its jurisdiction.
"The dismissal of Judges is an extreme step which might have dangerous domestic and international consequences for a revolutionary executive. Nor should it be too readily assumed that a regime which takes this step will easily find a replacement judiciary without leaving itself open to ridicule????????Had the Rhodesian Court, for example, held, that the revolutionary regime could be considered lawful only if confirmed in office by the electorate which had elected them under the old Constitution and if some satisfactory evidence was produced that the new Constitution was broadly acceptable to the majority of the population (in accordance with principles 7 and 8 listed above) is it inconceivable that the regime might have preferred to attempt to comply with that finding rather than to dismiss the Judges? The opportunities open to the judiciary to influence the course of events should not be dismissed out of hand. It may be that this is unaccustomed territory for the judiciary to enter. But this is true for many areas of law in modern times, especially with respect to the interaction between the executive and the citizen. It is hard to believe that our legal and cultural tradition is too weak to develop sound and acceptable principles in this new context: But in order that they may take root, it is necessary to rid ourselves of the conceptual block which would forever bar the entry of juristic thought into this domain. "
Islamic doctrine of sovereignty' as expounded in the Holy Book, that sovereignty belongs neither to the ruler nor the ruled but Almighty Allah alone which is to be exercised by the people of Pakistan through their chosen representatives. The Objectives
Resolution also envisages that the independence of Judiciary is to be fully secured. It is a fundamental principle of jurisprudence that Courts must always endeavour to expand their jurisdiction so that the rights of the people are guarded against arbitrary violations by the executive. It was rightly contended by Mr. Khalid Anwar that the orders of the Chief Executive are subject to the jurisdiction of the Constitutional Courts of the land. By including paragraphs 2(b) and 7 in the PCO, it has been recognized that the Superior Courts, which are respected by the people being an embodiment of the ideals of justice and guardian of the rights of the people are not merely entitled to continue but have, in fact, done so in the past as well. The Oath of Office (Judges) Order, 2000 (Order 1 of 2000), dated 25th January, 2000 allows all the Courts to continue to function and exercise powers, which is a reiteration of what was earlier stated by the Oath of Office (Judges) Order, 1999 (Order 10 of 1999), paragraph 3 whereof states that Order I of 2000 shall apply to: (1) newly appointed
Judges; (2) that Oath shall be made before the Constitutional authority; and
(3) that it would be in accordance with the appropriate form set out in the third schedule to the Constitution. This required the newly appointed Judges to take oath before the constitutionally designated authority and as per the procedure prescribed by the Constitution and not by the Order 1 of 2000. Mr.
Khairi was right in contending that any provision purporting to restrain the power of judicial review of the Superior Courts is to be ignored altogether.
Mr. Khalid Anwar was also right in contending that a Judge acting in his conscience and in good faith may decide to resign or he may decide that in the higher public interest he would retain office as has been done by the Judges of this Court and other Judges of the Superior Judiciary. We may refer to the book titled I "Constitutional Legitimacy"A Study of the Doctrine of
Necessity' authored by Leslie Wolf-Phillips, wherein the following passage occurs: -"A former member of the Argentine Supreme Court has justified the role of the Court as `the beneficial expression of a laudable political realism'. He saw choices before the Court in a revolutionary situation as irresponsible resignation, acceptance of the situation; an attempt to save what 'institutional values' remained to be saved:
It has exercised a function of institutional salvation by guarding human rights and the independence of the judiciary. It has been as if they said to the military men... we recognise the practical power that you exercise, because otherwise there would be chaos instead of order and authority in the country..."
Reference may be made to a famous statement of Thomas Jefferson who while asserting that the Courts always possessed judicial power since that alone assured the retention and exercise of the fundamental rights of the citizens:
"In the arguments in favour of a declaration of rights, you omit one which has great weight with me, the legal check which it puts in the hands of the judiciary. This is a body, which if rendered independent, and kept to its department, merits great confidence for their learning and integrity (cited by Professor John Agresto in his book "The Supreme Court and Constitutional Democracy, p 19).
The same author, Professor Agresto further says:
"On one side there is the venerable argument that looks on the Court as the Founders' protective barrier against unconstitutional acts, our security against political usurpation. The Justices in this account, stand as defensores fidei, as the watchmen in the constitutional edifice. ( id. p 21 )
Still further the same author says:
"On that level Judges become officials of goodwill who can read well. At this extreme it is their judicial dispassion that makes us rest easy in their guardianship?????.John, Marshall began more convincingly: it was. in fact the very passion for the judicial branch, its passion for rule of law, that made the Court the proper Guardian of the Constitution. ( id. p. 21 )
Thus visualised, the purported ouster in the Proclamation and the PCO 1 of 1999 of the jurisdiction of the Superior Courts is an exercise in futility and the power of judicial review remains intact. Both under Islamic doctrines as well as under its constitutional/juridical personality, the Superior Courts would continue to exercise this power.
INTERVENTION BY THE ARMED FORCES
221: Let us now examine the circumstances which paved the way for the impugned action of the Armed Forces, the issuance of the Proclamation of Emergency and promulgation of PCO 1 of 1999 in the country. It is alleged that on 12th October, 1999, the former Prime Minister Mian Nawaz Sharif retired General Pervez Musharraf, Chief of Army Staff/Chairman, Joint Chiefs of Staff Committee from his office, when the latter was out of Pakistan on official visit to Colombo, Sri Lanka and appointed Lt. General Ziauddin, the then Director-General, ISI, as the Chief of Army Staff. Announcement to this effect was relayed on the electronic media. It is further alleged that since an illegal order had been passed by the Prime Minister whereby an' attempt was made to create dissension among the Armed Forces and integrity and sovereignty of the country was threatened, the Armed Forces proceeded to take over the affairs of the country as a last resort in order to avoid further disintegration. . It is also alleged that a criminal conspiracy was hatched by the former Prime Minister and his associates and co-conspirators both at Islamabad and at Karachi to commit serious offences of hijacking of Flight PK-805 carrying on board the Chief of the Army Staff, General Pervaiz Musharraf and 197 persons.
?
"You are all aware of the kind of turmoil and uncertainty that our country has gone through in recent times. Not only have all the institutions been played around with, and systematically destroyed, the economy too is in a state of collapse. We are also aware of the self-serving policies being followed, which have rocked the very foundation of the Federation of Pakistan."
"Our concerns again were conveyed in no uncertain terms but the Government of Mr Nawaz Sharif chose to ignore all these and tried to politicize the army, destabilize it and tried to create dissension within its tanks."
"I was in Sri Lanka on an official visit. On my way back the PIA commercial flight was not allowed to land at Karachi but was ordered to be diverted to any where outside Pakistan. despite acute shortage of fuel, imperilling the life of all the passengers. Thanks to Allah, this evil design was thwarted through speedy army action "
The learned Attorney-General has placed on record an article by Kamran Khan of News Intelligence Unit, published in the daily "The News" dated 14-10-1999, titled "Ambitious Ziauddin Butt steered Nawaz to political disaster" , relevant portion of which reads as under:
"Within half an hour of his surreptitious climb to the post of the Chief of Army Staff on Tuesday afternoon, the former Inter ?Services Intelligence Chief, General Khawaja Ziauddin knew that the Army he was supposed to lead was not prepared to accept his command."
"The News Intelligence Unit (NIU), has gathered, that all of Ziauddin's phone calls to the Corps Commanders and the Chief of General Staff that placed from the Prime Minister's House in Islamabad on Tuesday-drew a blank, a reaction that almost instantly drew down the curtains on former Prime Minister Nawaz Sharif's second term in office."
"Debriefing sessions with detained aides of the Nawaz administration by security officials here have disclosed that the former ISI Chief -led operation to stage an in-house coup in the Army was driven by his personal ambitions ignoring the actual situation on the ground."
"Even a layman in Pakistan is aware that any operation of this sort can never be completed without the active support of the troops and commanders posted in the cities of Islamabad and Rawalpindi," an army official commented."
"It has now become clear that Lt. General. Ziauddin was the architect of the secret operation that envisioned the official announcement of his promotion to the post of COAS once General Pervez Musharraf boarded PIA Flight PK 805 in Colombo for a journey that severed his contact with the GHQ for a good 200 minutes."
"It was also Lt. Gen. Ziauddain who, alongwith the former Principal Secretary Saeed Mehdi, had suggested to Nawaz Sharif that General Pervez Musharraf's plane must not be allowed to land at Karachi so that he could be arrested at any other less busy airports in Sindh."
Clearly, in view of the reasons given in the Short Order coupled with the circumstances and observations stated in this judgment, intervention by the Armed Forces warrants validation on the basis of the doctrine of `State necessity' and the principle of salus populi supremo lex.
CORRUPTION
It has been alleged that the former Prime Minister and his chosen few in the Parliament plundered the national wealth and amassed personal wealth by engineering bank defaults of Rs. 356 billion and thereby indulged in acts of corruption and corrupt practices, which destroyed the national economy. On account of such massive corruption and corrupt practices in the administration of the affairs of the Government and its various bodies, authorities and corporations, the orderly functioning of the Government in accordance with the provisions of the Constitution and the law had lost its meaning. It is alleged that public faith in the integrity and honesty of the government had disappeared, in that, the members of the Government were either directly or indirectly involved in such corruption and corrupt practices. It is alleged that Mian Nawaz Sharif's constitutional and moral authority stood completely eroded and that the situation was somewhat similar to the situation that was prevalent in July, 1977.
Regarding petitioners' plea that the politicians/parliamentarians have been condemned as a class for indulging in corruption and corrupt practices, it has been averred in the written statement that the charges are neither vague nor general nor undefined. It is pleaded that the systematic manner in which the entire governmental process was undermined and subverted and the way self-serving policies were followed by the previous government, do provide sufficient proof of the above allegations. It is further pleaded that since the government was being run contrary to the provisions of the Constitution and since there were massive and widespread violations of the Constitution and the law, the Armed Forces were compelled to move in as a last resort to prevent any further destabilization, to cleanse the system and ultimately restore true democracy. On behalf of the Federation, voluminous record spreading over dozens of paper books has been filed in support of the allegations of corruption and corrupt practices by the former Prime Minister as well as other members of his government. We would suffice by giving few instances in that behalf.
Reference may first be made to a press clipping published in Daily 'Dawn' dated 24th October, 1999 under the Heading "Rs 211 billion non? performing, Rs 145 billion defaulted. Defaulters owe total of Rs. 356 billion", says Yaqub:-
"Speaking in a television programme he said that non-performing loans amounted to Rs. 211 billion and defaulted loans stood at Rs.145 billion."
"Dr Yaqub added that a major chunk of Rs 100 billion of the defaulted loans was owed by 322 families or groups. he said in all 100 groups or families owed Rs 64 billion. A sum of Rs. 30 billion was due from only 25 groups or families.
"The SBP Chief clarified that a loan was categorized as non? performing when repayment of its instalments got stopped due to one reason or the other, If instalments are not paid for one year, the loan becomes defaulted."
"The SBP Governor said the new government was determined to pursue loan defaulters and unlike past the defaulters should take the deadline seriously."
"He said cases of all loan defaulters, including bankers, businessmen, politicians, agriculturists would be pursued without any discrimination."
"Dr. Yaqub said 322 families and conglomerates owed Rs.100 billion of the national wealth out of which only 25 families owed Rs. 30 billion."
"The defaulters owe Rs 145 billion to the financial institutions while Rs.211 billion are payable in the category of non-performing loans. "
Reference may also be made to Daily Dawn, dated 15th November, 1999, publishing a news item under the Heading "Two more cases against Sharifs sent to NAB?, relevant portion whereof reads thus:
"Two more cases have been sent against the deposed prime minister, Nawaz Sharif, and his brother and former Punjab Chief Minister Shehbaz Sharif to the National Accountability Bureau (NAB) for investigations."
"One case is that they exported huge quantities of sugar to India and received heavy amounts in rebates."
"The other case is based on a complaint filed by PPP Chairperson Benazir Bhutto alleging that the Sharifs owned Cayman Island, an offshore company, through Al-Towfeek Company."
1.???????? "Hotel Holiday Inn Scandal
2.???????? Loan Scandal
3.???????? Helicopter Scandal
4.???????? Wheat Scandal
6.???????? Murree Land Scandal
7.???????? BOI State Land Scandal
8.???????? Redco Loans Scandal
9.???????? Illegal Appointments
10.?????? Tax Evasion Reference
11.?????? Muhammad Sharif's Promotion Reference
12.?????? Kohinoor Energy Scandal
13.?????? Raiwind Mahal Scandal
14.?????? Black Money Scandal
15.?????? Luxury Cars Scandal
16.?????? Dollars Scandal
17.?? Illegal Appointments in PIA"
GRAND TOTALS OF LAND/PROPERTIES IN THE NAME OF NAWAZ SHARIF AND HIS RELATIVES
| | | | | | | | --- | --- | --- | --- | --- | --- | | S.No | NAME OF OWNER | LAND?? ?????? K. | ???? ?????? M. | ? ???????? SFT. | COST (IN RUPEES) | | 1 | Total Property in the Name of Nawaz sharif Father, Mother, Wife and Brothers. | 5684 | 12 | 75 | 16,08,75,338 | | 2 | Total Property in the Name of Uncles Cousins and In-laws. | 12705 | 13 | 13 | 8,58,73,078 | | | Total: | 18390 | 6 | 88 | 24,67,48,416 | | 3 | Total Land in the Name of Industries. | 2465 | 15 | 136 | 9,48,90,435 | | | GRAND TOTAL: | 20856 | 1 | 224 | 34,16,38,851 |
A Reference had also been filed under Ehtesab Act, 1997 against former Prime Minister Muhammad Nawaz Sharif, Chief Minister Punjab Mr. Shehbaz Sharif and others for misusing the official resources and causing loss to the National Exchequer to the tune of Rs. 620 million, on 17-6-1998 which is still pending. Detail of which is as follows:-
"1.-????? After assuming the power as Prime Minister, the private residence at Raiwind of Muhammad Nawaz Sharif was declared as Prime Minister's Camp Office and its entire maintenance was executed by the Federal Government Department, PWD. PWD not only maintained the P.M. Camp Office but also the residential portions of other Sharif family members. So, a huge amount of Rs.80 million was approved by the concerned quarters and was spent on the residence of Sharif Family.
2.???????? A sum of Rs. 70 million was spent by the Sui Northern Gas Pipelines for providing the Gas facility to the Raiwind Farm owned by the Sharif Family.
3.???????? Rs. 320 million was spent by the District Council Lahore to build a new carpeted 20-feet wide road on both sides of the canal from Adda plot to the Sharif Farm and connecting the Sharif Farm with the Main Raiwind Road.
4.???????? Rs. 80 million cost for lining up the part of Bucher Khana canal which passes through the Sharif Farm.
5.???????? WAPDA also spent an amount of Rs. 50 million for laying special line for the Sharif Farm house on the direction of the former Prime Minister.
6.???????? P.M. Nawaz Sharif also directed the Tele Communication Corporation to set up a 200-Lines Telephone Exchange near the farm for the exclusive use of the Sharif family, thus, a sum of Rs. 20 million was spent for the purpose."
ILLEGAL EXTRACTION OF HEAVY AMOUNT BY MIANNAWAZ SHARIF, SHEHBAZ SHARIF AND HIS FAMILY MEMBERS FOR THE FOLLOWING UNITS OWNED BY THEM.
| | | | | | --- | --- | --- | --- | | Sr. NO. | NAME OF UNIT | OUTSTANDINGLIABILITY (In Millions) | | | 1. | Ittefaq Foundries Ltd. | 1,556 | | | 2. | Ramzan Sugar Mills Ltd. | 623 | | | 3. | Haseeb Waqas Sugar Mill Ltd. | 543 | | | 4. | Mehran Ramzan Textile Mill | 455 | | | 5. | Ramzan Bukhsh Textile Mill | 373 | | | 6. | Brothers Sugar Mills Ltd. | 351 | | | 7. | Ch. Sugar Mills Ltd. | 339 | | | 8. | Ittefaq Sugar Mills Ltd. | 313 | | | 9. | Ittefaq Brother Ltd. | 226 | | | 10. | Sandalbar Textile Mills Ltd. | 205 | | | 11. | Khalid Siraj Textile Mills Ltd | 191 | | | 12. | Hudabiya Engineering Co Ltd. | 182 | | | 13. | Brothers Textile Mills Ltd. | 174 | | | 14. | Ittefaq Textile Mills Ltd. | 164 | | | 15. | Brothers Steel Ltd. | 159 | | | 16. | Hamza Board Mulls Ltd. | 153 | | | 17. | Hudbiya Paper Mills Ltd | 134 | | | 18. | Ilyas Enterprised Ltd | 3 | | | 19. | Ittefaq Hospital Trust | 2 | | | | ??????????? Total: | | 6,146 | | | | | |
???????????????????????????????????????????????????????????????????????
TRANSCRIPT OF BBC TELEVISION'S DOCUMENTARY ON CORRUPTION IN PAKISTAN
"Najam Sethi's interview.---I will just give you a short story. (As advisor on accountability in interim government of Meraj Khalid) I asked the Chairman of the Central Board of Revenue to give me a brief about who is corrupt and who is not in terms of who has paid income tax and who has not. He brought a truck load of files. I was struck. He said where you want to start because everybody is corrupt from the top to the bottom.
Background commentary.---They say there is corruption everywhere in Pakistan. People may trust the traders in the Sunday market but when they deal with government officials people expect of Pakistan (Irshad Hasan Khan, C J) to be ripped of. And politicians talk politics, they say and you are talking cheating big time.
Interview of Sajjad Ali Shah.---Corruption is now not considered as a bad thing and it has become a norm of life. People have started expecting it. Now it has become part of the system, as if it is accepted and nobody considers it a bad thing so I think it is eroding the fabric of the society.
Background commentary.---In every original affidavit submitted to the Court, the intelligence officer who allegedly acted as go between, listed Nawaz Sharif as having received Rs. 3.5 million.
Nawaz Sharif shown addressing a public rally.
Background commentary. ---What Mr. Nawaz Sharif is selling is a vision. Vision of an impoverished country to transform into a world power. His monument is likely to be the 170-mile motorway from Lahore to Islamabad along cherished ambition, which almost cost a billion dollars. His critics though say that the country cannot simply afford such grandeur projects. The motorway is not so much used by traffic, is haunted.
Mr Najam Sethi interviewed on Nawaz Sharif's grandeur projects.
Najam Sethi.---Nawaz Sharif has always fancied himself as a Mughal Emperor. And the Mughal Emperors were great builders. They are remembered for having built great monuments. And story goes that the Finance Minister once said to the Prime Minister that we can't build this motorway because we will run into awful fiscal deficit problem as we don't have that much money. And the (Nawaz Sharif) said to him "forget the fiscal deficit. Sher Shah Suri, who built the Great Grand Trunk Road, is remembered not for the fiscal deficit that he ran into but for the great motorway that he built". This is Nawaz Sharif's case --- elemental Mughal splendour.
The programme shows Rehman Malik as telling reporters in Islamabad during his tenure as additional DG FIA, that the focus of the investigations were accounts of Salman Zia and Qazi family.
Background commentary. ---What Malik investigated and put before the Court were allegations that the family having moved money out of Pakistan during good times were now bringing it back. His case began with the bank account of Mr. Salman Zia, a name that became central to his investigations down town in Lahore where Mr Zia's accounts was opened in Habib Bank A.G. Zprich, in 1992. Malik's inquiries showed mysterious deposits of hundreds of thousands dollars paid into this account in traveller's cheques.
Rehman Malik.---During investigations we found that heavy transactions from abroad have come to Salman Zia's account. When further details were examined, we found that travellers cheques amounting to 700,000 dollars came in. That made us suspicious that it is money-laundering.
Background Commentary.---Bank records obtained by Mr Malik show that during short period, Salman Zia had traveller's cheques worth 1.5 million dollars paid into his account. It seemed that mysterious millionaire Mr Zia was getting richer by the day. Malik also discovered that hundreds of thousands of dollars have been paid into his accounts from American and Swiss Banks.
General Babar.---The bank account application was astounding. It just said Salman Zia son of Muhammad Zia, agriculturist, Main Bazar, Sahiwal, which is a minimum of address and to cap it all it is a "no correspondence" and the fact that millions of dollars have been transacted through this account.
Rehman Malik.---Salman Zia? He is a fake man. He does not exist. The focus of the investigation is that Salman Zia doesn't exist. He is shown as an agriculturist. He is a poor man, having transactions of millions of dollars.
Background commentary. ---From Salman Zia's accounts, Malik then told the Court that the trail led to London. Malik claims that millions of dollars issued from Zia and other fake accounts were being paid into the accounts opened back in Pakistan in the names of a London family --- the family known as Qazis. Unlike the mysterious Salman Zia, Malik believed that Qazis really existed. They had passports. But the passports were British. Malik says that he found that not only the family had been in Pakistan when the accounts were opened there in their names.
Background Commentary.---So, where were the mysterious Qazi family, Malik discovered they live in the east side of London. May be the Qazis were city brokers. After all their accounts said there were millions of pounds in them. But the fact is that the trial of the Qazis led past the city, well past it. It led to Ilford in Essex, The town not associated with huge bank deposits. The trail led on to the Pioneer Market in Ilford area to a fashion boutique shop there. It is called "Utter Nutter". It is a modest business run by Kashif Qazi (youngest son of Masood Qazi). Mr Qazi sells jeans, designer clothes, and fashion accessories. The Qazis home is off the Ilford Lane. To the family's amusement, letters started dropping through their letter box from banks in Pakistan. The good news for the Qazi family was that accounts opened in their. names had millions of dollars in them. The bad news, that it were being used as guaranteeing loans to Pakistani companies --- companies connected to the family of the Prime Minister of Pakistan. One day Kashif Qazi opened a letter that said he had over 2.0 million dollars but it had been used for loan to Hudabiya engineering, the Sharif family company which had not paid any of its dues. Kashif Qazi was now being asked to "please arrange the payment". His brother Talat found, he also had 2.0 million dollars. This money was too used to help guarantee loans but the interest on the loans was not being paid so the bank threatened to sell his US dollar deposit in the event of any breach of financial agreement. Another worrying letter said that in spite of the bank's repeated reminders and constant follow up, they did not receive any payment from the Sharif Company, to which the money had been lent to.
Background commentary. ---The Qazis deny any involvement up of Lahore accounts. It was a puzzle why their names should appear in the name trail. So, was there any connection between them and the Sharifs? Speculation -in Pakistan has centred around a mutual friend. He is a man, who in the 70s, was a paying guest of the Qazis when he was studying in London --- Mr.Ishaq Dar. Today Mr. Dar is Nawaz Sharif's Finance Minister. He categorically denies any involvement. Mr Dar was unavailable for interview but he did write to us. He said the Qazis are the friend for himself and the Sharifs. But he blamed press speculations on Rehman Malik for floating all sorts of stories. The Qazis were furious, when on a visit to Pakistan in last October, they were photographed a; the airport and local newspapers seized the chance to stir the controversy. The Qazis were treated not just like friends, it was suggested, but like official state guests. In fact we have seen a state official, in-charge of Protocol, referred to the Qazis as the Prime Minister's guests and requested them appropriate reception at the airport, accommodation in state guest house and chauffeur driven vehicle in good condition. We had arranged an interview with Kashif Qazi, but when we arrived at his home, we were told he had - gone to a Paris fashion show. When we went to film his shop, (close to the house), we found Kashif Qazi behind the counter.
Background commentary. ---But Mr. Sharif's critics say that he has tried to interfere with the Court's independence. (Scenes of Muslim League workers attacking the Supreme Court are shown). For example they say take the dispute he had with the Supreme Court Chief Justice soon after he was re-elected.
Interview of Former Chief Justice Sajjad Ali Shah.---It (relationship) was not very cordial, of course. There were several complaints and several cases (against the prime minister) which were being heard and the prime minister did not want me to hear those cases. He was under the impression that as prime minister he was exempted from the proceedings in the court and the court should not hear cases. So, this was the point of difference. I told him that this was not the correct view because there is no discrimination in the eyes of law.
Background commentary.---The Chief Justice's felt his fears were justified when pro-Sharif demonstrators stormed the Supreme Court and the police stood aside.
Sajjad Ali Shah.---They were raising slogans against me, and accusing me. They had burnt my effigy outside and holding banners against me. I think they were saying that I am the enemy of the prime minister.
Background commentary.---A case that could have led to the Prime Minister's dismissal was abandoned. The Chief Justice claimed that the mob, which included members of the parliament, was politically organised.
Interview, of Solicitor Robert Kearns.---My clients provided security of that investment through personal guarantees which were offered by three members of the Sharif Family in Pakistan. We obtained a judgment in respect of those guarantees. It is against the Prime Minister's brother, which is in excess of $ 17.0 million and Prime Minister's father which is in excess of $ 14.0 million. We would like the judgment to be implemented... they should come to this country and explain what assets they have here and abroad which could set aside that debt. My clients are interested in any assets. It's -a substantial amount of money and quite understandably they want the payment.
Background commentary.---Now the vendettas are becoming more personalised and claiming more victims, including those who really report those accusation. (Pictures of Lahore journalists protesting against the arrest of Friday Times Editor Najam Sethi, are shown) Sethi, was arrested soon after our interview. He was held in solitary confinement for 27 days, till his release without any charge a few days ago. His detention was widely condemned as an attempt to intimidate those who ask awkward questions about Pakistan's rulers, including Nawaz Sharif."
"The House of Lords described the two major political parties of Pakistan as "corrupt, incompetent, unpopular and highly damaging to the welfare of the people in Pakistan" and observed that it was "kleptocracy which was ripping millions of rupees away from the public exchequer."
"The British House of Lords in its recent two hours and 48 minutes long exclusive debate on Pakistan pledged that "we want the best for Pakistan and its, people, a strong and resilient democracy that can guarantee political and economic security for its citizens, and work for peace in the region." Eighteen peers who spoke, in the House, agreed on the motion on Pakistan. It is reported that Lord Paul said "Corruption was the downfall of previous Pakistan governments. We must, of course, strongly condemn corruption wherever it exists, in Pakistan or elsewhere. It eats into the heart of any society, particularly a society that has few resources and great developmental demands. Let us make sure that economically developed countries do not, inadvertently or otherwise, facilitate corruption in other regions..."
"Baroness Strange, briefly expressing her point of view regarding the situation in Pakistan said: "General Musharraf has arrived there in rather an undemocratic way. The regime that he replaced, although democratically elected in the first place, had turned out to be not very democratic in practice, difficult to dislodge and gradually becoming more and more corrupt. General Musharraf has said that as soon as the country resettles itself, he will re-initiate democracy. Naturally, we are very anxious to see this happen. We are also anxious to see the lessening of tension towards Kashmir and other neighbours and a cessation of nuclear testing. I should like to emphasise our close ties with Pakistan, both now and historically. We wish her and her new government well.
"The Government of General Musharraf evidently has the support of the vast majority of the people of Pakistan for the first item of his agenda to punish those who had stolen the country's money. Under Nawaz Sharif, Pakistan was sliding into bankruptcy, but his predecessor (Benazir Bhutto) had also allowed her cronies, and especially her husband, to profit from their hold on the reins of government," Lord Allon said."
"Lord Sandberg taking floor said, "We were only aware of the deep corruption of successive governments over too many years." He said that the low turnout was influenced by the fear that both parties were almost equally corrupt. "That fear turned out to be only too true. Almost immediately, Sharif and his colleagues started to feed at the same trough as their predecessors. The reaction in the streets in Pakistan to the army's action told its own story. There were almost universal relief and rejoicing and the grassroots support has continued. Since. then the stock exchange index in Karachi has risen from about 1, 130 to 1,700 points, an indication of the greater confidence investors have in the new administration. "
"Lord Sandberg said that he made these points because those with perhaps little understanding of Pakistan were quick to criticise the move by General Musharraf. "Perhaps with more thoughts it might have been seen as an almost inevitable event when one takes into account the fact that the political and economic situations were at such a low ebb." He said: "General Musharraf has refrained from martial law or any of the other extremes that we have come to fear after a military coup. Indeed, we understand that the Courts and judiciary are functioning normally. There appears to be a free press." He questioned the suspension of Pakistan from the Commonwealth and said, it was somewhat premature and a little hasty decision."
"Lord Ahmed while speaking on the motion said that in recent years Pakistan had become a dysfunctional and sham democracy, had in fact become a kleptocracy as described by Lord Weatherill, earlier. "
"He said that General Musharraf had announced that there would be local and district elections this year. "That will pave way for true, genuine and lasting democracy in Pakistan. General Musharraf's action was clearly in Pakistan's national interest. The people of Pakistan have accepted and welcomed the removal of the previous Government arid that is perhaps why there was no violence or bloodshed and 80 per cent of the public supported the change."
While concluding his submissions as to the allegation of corruption and corrupt practices, the learned Attorney-General made a statement in Court by way of clarification that some of the politicians/parliamentarians are not included in the list of persons accused of corruption and corrupt practices, namely, Raja Zafarul Haq, Mr. Wasim Sajjad and Ch. Shujaat Hussain. He also stated that allegation of misdeclaration of assets against Mr. Elahi Bakhsh Soomro is incorrect.
Syed Sharifuddin Pirzada, learned Senior ASC was right in contending that there were serious allegations of corruption, nepotism, lack of transparency and no accountability and that where there is corruption, there is no good Government, which fact has been recognised by this Court by observing that corruption by. itself is a ground for imposition of Martial Law or Proclamation of Emergencies.
Reference may be made to a study on "Corruption and Government, Causes, Consequences, and Reform" by Susan Rose? Ackerman from Cambridge University, wherein the modes of corruption resorted to by various rulers have been explained and examples of certain countries such as Paraguay, Zimbabwe, etc. have been given, in which corrupt means were adopted. It is also stated that the process of privatization can reduce corruption by removing certain assets from State control to the private sector, though the process of transferring assets to private ownership is fraught with corrupt opportunities. The writer further states that corruption involves top-level- officials which can produce serious distortions in the way Government and society operate and that these corrupt officials distort public sector choices to generate large rents for themselves and to produce inefficient and inequitable public policies with the result that many wrong kinds of projects are initiated. The author, therefore, suggests that the Government should consider promulgating statutes that protect and reward those who report wrong doings. It would be advantageous to reproduce the relevant portion of the above study, which reads thus:
"Grand corruption" occurs at the highest levels of Government and involves major Government projects and programs (Moody-Stewart 1997). Governments frequently transfer large financial benefits to private firms through procurement contracts and the award of concessions. Bribes transfer monopoly rents to private investors with a share to the corrupted officials. Privatization processes are vulnerable to corrupt insider deals".
"In Paraguay corruption in the award of international construction contracts during the regime of President . Alfredo Storeowner (1954-1989) typically ranged from 10 to 20 percent. Corruption helped inflate the cost of the Utopia dam on the Brazilian border and led to the construction of projects that exceeded domestic needs (Nicks 1996: 244-245). In Indonesia in the 1970s two German companies reportedly paid bribes to 20 per cent. of the state-owned oil company (Schwarz 1994: 138)".
"In Zimbabwe collusion between senior ministers in Posts and Telecommunications and a Swedish telecommunications company may have circumvented local tender board procedures. Kickbacks were reported to be as high as $ 7.1 million. In an airplane deal in South Korea several United States companies allegedly paid bribes to President Oh Tae Woo. Multinational suppliers were questioned, but denied involvement. In another arms deal Oh Tae Woo's national security advisor acknowledged receiving payments that may have been as high as $ 300,000. A major scandal in Singapore involved several multinational firms and a senior official of the Public Utility Board. The official was paid to reveal confidential information about tenders. The case led to the blacklisting of five major multinationals implicated in the scandal. The official received a fourteen-year jail term".
"Corrupt rulers favour capital-intensive public projects over other types of public expenditures and favour public investment over private investment. They will frequently support "white elephant" projects with little value in promoting economic development."
"Privatization can reduce corruption by removing certain assets from state control and converting discretionary official actions into private, market-driven choices. However, the process of transferring assets to private ownership is fraught with corrupt opportunities. Many corrupt incentives are comparable to those that arise in the award of contracts and concessions".
"Corruption that involves top-level officials can produce serious distortions in the way Government and society operate. The State pays too much for large-scale procurements and receives too little from privatizations and the award of concessions. Corrupt officials distort public sector choices to generate large rents for themselves and to produce inefficient and inequitable public policies Government produces too many of the wrong kind of projects and overspends even on projects that are fundamentally sound. Corruption reduces the revenue-raising benefits of privatization and the award of concessions."
"Thus Governments should' consider promulgating statutes that project and reward those who report malfeasance (Pope 1996: 59-61). The United States, for example, has two statutes. The False Claims Act rewards those who report irregularities in Government contracts 'and protects private sector whistleblowers from reprisals (31 U.S.C. ss 13729-3731; Howse and Daniels 1995; Kovacic 1996). The second protects whistleblowers inside Government Agencies from retaliation (Whistleblower Protection Act, Pub. L.No. 101-12,5 U.S.C. s 2302 (b) (8)."
"In a system where government is publicly accountable, favoritism would not be possible if the specifications were made public. Too great an intertwining of contractors and public officials invites corruption. Systems that are more transparent and accountable can afford to give procurement officers more discretion than others with less accountability.
"The criminal law is the second basic part of a comprehensive strategy."
"Good governance is not a luxury but a basic requirement for development. Corruption, which undermines development, is generally an outcome and a symptom of poor governance. It has reached global proportions and needs to be attacked directly and explicitly.
"2. Corruption is always a two-way transaction with a supply and a demand side. It occurs in poor, emerging, and developed nations, regardless of the level of social and economic development and in countries with varying forms of Government ranging from dictatorships to established democracies.
"3.??????? Corruption, which is multi-dimensional, generally occurs at the nexus between the public and private sectors, with actors in the private sector interacting with holders of offices of trust in the public sector. Some aspects of corruption such as fraud and the misappropriation of assets or funds can occur entirely within the private or public sectors. However, with increasing privatisation of public utilities and service, the distinction between the public and private sectors is becoming less relevant in some areas.
"4.??????? Corruption is generally defined as the abuse of public office for private gain. As the scope of corruption has widened, this definition has been enlarged to cover the abuse of all offices of trust for private gain. There are many types and levels of corruption including "grand corruption", which involves huge sums paid by major businesses to high-level politicians and/or Government officials, widespread systemic corruption which may take the form of substantial bribes to public officials to obtain. for example licences/permits or to by-pass regulations; and petty corruption ''which involves modest but recurring payments to avoid delays. jump queues or to obtain goods in controlled markets. All forms of corruption entail high economic and social costs; transaction costs are increased; public revenues are reduced; resource allocation is distorted; investment and economic growth is retarded; and the rule of law is weakened.
"5.??????? The. Commonwealth should firmly commit itself to the policy of "zero tolerance" of all types of corruption. This policy must permeate national political cultures, governance, legal systems and administration. Where corruption is ingrained and pervasive, especially at the highest political levels, its eradication may require a sustained effort over a protracted period of time. However, the policy of "zero tolerance" should be adopted from the outset, demonstrating a serious commitment to pursue the fight against corruption. The Commonwealth should remain firm in its determination that the high standards and goals enunciated in the 1991 Harare Declaration are upheld and enhanced. Creating an environment which is corruption-free will require vigorous actions at the national and international levels, and within the Commonwealth itself. These actions should encompass the prevention of corruption, the enforcement of laws against it and the mobilization of public support for anti-corruption strategies.".
Reference was also made to Federation of Pakistan v. M. Nawaz Khokhar (PLD 2000 SC 26), wherein at page 35 of the report it was observed:
"At this stage, we may also mention that at least on two previous occasions, the justification for imposition of Martial Law and deviation from the Constitutional Rule in the country was sought to be justified on the plane of rampant corruption of the politicians. It is also not without significance that four previous elected Civilian Governments were also dismissed before completion of their tenure under the Constitution on allegations of corruption besides other allegations. In this backdrop, when the second Benazir Bhutto's elected Government was dismissed under Article 58(2)(b) of the Constitution in November, '1996, there was a public outcry for a severe accountability of the holders of public offices. The caretaker set-up which came into existence as a result of dismissal of elected Government of Benazir Bhutto, therefore, promulgated- Ehtesab Ordinance CXI of 1996, which was later amended through Ordinance CXXIII, Ordinance VII and Ordinance XI; before it was repealed and replaced by Ordinance XX of 1997. Nawaz Sharif's Government which came into power as a result of general elections in the country held in February, 1997, promulgated the Act which repealed Ordinance XX of 1997. In the light of the preceding discussion, we now proceed to consider the above contentions of the parties."
"We are beginning to see a far greater degree of willingness exhibited by all civilized Governments to share criminal information and assist and facilitate enquiries undertaken by other countries into the activities of criminals who commit offences within their own boundaries, but whose egregious behaviour affects persons or institutions in foreign jurisdictions. Concerted action against transnational criminality is now a well-established principle in international law and one method of ensuring that those activities are coordinated is by the drafting of legislation which is acceptable to those countries who have agreed to provide mutual assistance to each other to combat specific criminal phenomena, money laundering being one such example
All parties are obliged to provide the widest degree of investigative cooperation and to facilitate all proceedings aimed. at confiscation. Each party is required to assist in the confiscation of specific items of property representing the proceeds of criminality as well as such sums of money which correspond to the value of proceeds. Upon request from any other signatory, each country is bound to provide all investigative assistance and to take provisional measures, such as, the freezing of a bank account or the seizure of property, and upon request, execute a foreign confiscation order or institute its own proceedings leading to confiscation as requested. Bank secrecy may not be invoked as a ground for refusal of cooperation, although all signatories are bound to respect the rights of bona fide third parties and to provide then with legal remedies. As 'Levi identifies:
In short, a substantial amount of legal movement is taking place in Europe and elsewhere in the field of international mutual assistance in relation to money laundering and the freezing and seizing of assets. The moral and political pressure is so great that it is hard for countries to resist agreement. How the format rules work out in practice is another question (Levi, 1992)."
Now we come to the question whether corruption can be made a ground for justifying intervention by the Armed Forces. We would be examining this question in a slightly different perspective, inasmuch as, the world community is committed to the policy of showing "zero tolerance" to all types of corruption. It is a sad state of affairs that no conceivable steps were initiated to curb the systematic corruption because of lack of transparent accountability during the tenure of the previous Government. The material placed before us indicates that the former government had shown little interest in eradicating corruption from the society.
`Corruption' is generally defined as the abuse of public office for private gain. In view of the fact that scope of corruption has widened, this definition would include the abuse of all offices of trust. It has diverse meanings and far-reaching effects on society, government and the people. Of late, the culture of corruption and bribe has embedded in. our society to the extent that even routine works which should be done without any approach or influence are commonly known to be done only on some such consideration. This bribe culture has plagued the society to the extent that it has become a way of life. In Anatulay VIII (1988) 2 SCC 602 where Abdul IP Rahman Anatulay, Chief Minister of Maharashtra was prosecuted for, corruption Sabyasachi Mukharji, J. lamented as follows-.-
"Values in public life and perspective of values in public life, have undergone serious changes and erosion during the last few decades. What was unheard before is commonplace today. A new value orientation is being undergone in our life and culture. We are at the threshold of the cross-roads of values. It is for the sovereign people of this country to settle these conflicts yet the Courts have a vital role to play in these matters."
Although we are dealing with a case of intervention by the Armed ?Forces, yet it would be advantageous to allude to the ground of corruption, which came up for consideration in the cases of Kh. Ahmed Tariq Rahim (PLD 1992 SC 646), Mian Muhammad Nawaz Sharif (PLD 1993 SC 473) and Benazir Bhutto (PLD 1998 SC 388) (supra). In the first case, it was observed by Shafiur Rehman, J. that corruption may not have been independently sufficient to warrant such an action, but it can be invoked, referred to and made use of alongwith other more relevant grounds, which are by themselves sufficient to justify the action taken. In Mian Muhammad Nawaz Sharif's case (supra), it was observed that "if the corruption, nepotism and favouritism are of such a large scale that they have resulted in the breakdown of the constitutional machinery completely, it may have nexus with the above provision". In the third case of Benazir Bhutto, this . Court took notice of enormous corruption and treated it as an independent round on the basis of which an Assembly could be dissolved (Underlining is by way of emphasis). Once corruption pervades in the body politic and official circles, then the entire Government/administration becomes completely crippled and paralyzed. Recounting the instances of alleged corruption the Federation has pointed out Sharifs' ownership of Cayman Island, an offshore company through Al-Towfeek Co.. and the case of. huge quantity sugar export to India receiving heavy amounts in rebate. When corruption permeates in the social, political and financial transactions to such an extent that even proper and honest orders and transactions are suspected to the point of belief being a result of corruption, one is compelled to infer all is not well and corruption has gone deep in the roots. No doubt, this is an age of "corruption eruption", but during the last few years there have been large scale prosecutions of former world leaders .in various countries on the charges of corruption and corrupt practices, in some cases leading to convictions, which phenomenon must not be taken lightly and the issue must be addressed adequately and effectively through transparent institutionalized processes.
The observations made herein and in the Short Order are not intended to condemn en bloc the politicians and parliamentarians as a class. Undoubtedly, there are good, honest and upright as well as corrupt people in every group; of persons. These observations are confined only to the situation which is being attended to in these cases. Any proceedings commenced against any person including the parliamentarians or politicians or members from the general public under the laws of the country will, no doubt, be decided on their own merits in accordance with law and on the basis of the legally admissible material brought before the concerned fora in those proceedings without being influenced by any observations made in this T judgment. Put differently, it will be only after the finalisation of the proceedings as. above that the country will be geared up for resort to democratic principles and corruption-free society which are prerequisite for good governance. This situation has also been recognized by the Commonwealth Finance Ministers Meeting held on 21-23rd September, 1999 at Grand Cayman, Cayman Islands.
The Federation has also alleged that most of the politicians/parliamentarians have misdeclared their assets both before the Wealth Tax Authorities as well as the Election Commission including the former Prime Minister, who. admittedly despite owning a helicopter, did not declare the same in his declaration of assets. It has been pleaded on behalf of the Federation that although misdelcaration of assets was a matter of record, yet the Constitutional authorities failed to file references against them before the concerned fora. Thus, all such politicians/parliamentarians through their acts of commission and omission have rendered themselves ineligible for being members of the representative bodies. In order to substantiate the above allegations, the learned Attorney-General has filed voluminous record wherein specific instances of misdelcaration of assets have been given. We haveexamined the relevant record only for the purposes of the present controversy and find that sufficient material exists showing, prima facie, that a large 'number of politicians indulged in misdeclaration of assets, which factor has a bearing on the issue in hand.. We may clarify that misdeclaration of assets , or" any discrepancy as to declaration of assets before the Wealth Tax Authorities qua the Election Commission may not by itself be a ground for intervention of the Armed Forces on 12th October,, 1999 but this aspect of the matter when viewed in the overall context and with particular reference to the alleged massive corruption and corrupt practices becomes a relevant factor.
COLLAPSE OF ECONOMY'
238- We have gone through the material placed by the Federation on the above issue. While this Court has already lamented over the decision of the former Prime Minister freezing foreign currency accounts in the case reported as Federation of Pakistan v. Shaukat Ali Mian (PLD 1999 SC 1026), the fact remains that this step of the deposed Prime Minister shattered the confidence of the overseas Pakistanis, who had deposited their savings in Pakistan in preference to banks abroad for the benefit of the nation. After hearing the learned counsel for the parties and going through the record, we have gathered that the combined effect of the overall policies and methodology adopted by the former Government was the total collapse of the country's economy inasmuch as GDP growth during the past three years had hardly kept pace with the growth of population and Pakistan has a debt burden which equals the country's entire. national income. We also take judicial notice of the fact that the trade imbalance was persistent and due to defective economic policies and lack of economic discipline .by the previous regime, the industrial sector had suffered a great setback.
ROLE OF PUBLIC REPRESENTATIVES
He also referred to an interview of Mr. Majeed Nizami, Chief Editor of the Daily Nawa-e-Waqt' andThe. Nation' given to Pakistan Digest, published in the. Daily Nawa-e-Waqt, Rawalpindi, dated 30-4-2000 wherein he stated:
While substantiating the above allegations against the members of the former Government, the learned Attorney General contended that the. actions of the former Government were not in conformity with the maintenance of sovereignty, integrity, well being and prosperity of Pakistan because when the Chief of Army Staff -was attempted to be handed over to an enemy country and he was exposed to physical annihilation and further fen it tried to create dissension in the ranks of the Armed Forces, it was not safeguarding or maintaining the sovereignty of Pakistan, rather the sovereignty and integrity of the country were seriously endangered because it is the only institution, which is capable of safeguarding the integrity of Pakistan. On the question of well-being, the learned Attorney-General stated that the well being of the. people is a reflection of the combined effect-of sovereignty, integrity and solidarity and there can be no well being without either of sovereignty, integrity, solidarity and prosperity. Likewise, prosperity again embodies all these ingredients and also extends to the economic prosperity of the people of Pakistan.
We have examined this aspect of the case with greater caution as we are. not dealing with a case of dissolution of Assembly, but here the Court is faced with a situation not visualized by the Constitution. On an objective assessment of the material placed on record and in view of the arguments advanced by the parties, we find that the very purposes for which the representative institutions were established under the Constitution stand defeated either directly or indirectly. No one could disagree that we must have democracy and any obstacles in respect of achieving that goal must be overcome. But the real question is whether there was "democracy" in its generally accepted' sense on 12th October, 1999 when the Army takeover occurred? What regretfully existed in Pakistan on that day and for years prior to that time was merely a feigned appearance of what we can call a form of "oligarchy" as submitted by Dr. Farooq Hasan.
Democracy can be defined in a variety of ways. But its most fundamental and cherished ingredient is the notion of "responsibility" of the rulers to the ruled. The meanings of this concept are given in the New Dictionary of American Politics, by Smith & Zucher (First edition) wherein at page 114 it is defined:???????????
"Rule by the people. In practice this means that power to determine the major, issues of public policy must reside in the majority of the community and that in making such decisions, the vote and voice of each individual should count. Hence democracy can be defined as government by consent. The people may exercise such power ??????to enforce responsibility upon those to whom authority is entrusted."
In another leading work, "The Politics of American Democracy", by M. Irish, (Third Edition) at pages 52 to 81, the following main ingredients of this method of governance are summed up as follows:
(1)??????? "Just what do we mean by democracy" There is no simple answer. However, there must be present notions of "equality", "humanitarianism" and notions of "individualism and progress" for those who are ruled by those who are entrusted with the task of governance (pages 52-53).
(2)??????? "Democracy requires that those vested with power be responsible to the people" (Page 72).
(3)??????? That under the guise of democracy we must be watchful of "champions of Oligarchy". For besides the government of selected powerful groups we also have similar notions advocated for both "fascism" and "communism" which superficially may look like democracies but are in fact the very antithesis of it (pages 72-73).
(4)??????? The learned author sums up the essential ingredients of democracy stating that : "certain conditions seem to be necessary before democracy arises. : (1) a relatively high level of literacy, (2) some f minimum measure of economic security, and (3) an acceptance of the dignity of human life."
It is, thus, to be seen that simply by casting periodic ballots, people do not get a democratic society. Instead they may well-create, what is the case in Pakistan, particularly since 1985, a terrible form of fascism of a group of powerful people. This form of Government, although superficially, elected; actually creates an "oligarchy". In the work already cited above by Smith & Zucher, oligarchy had come to exist in Pakistan prior to 12th October, 1999. . The above- form of Government has been defined in the above cited books as follows: '
"A Government in which the authority constitutionally reposes in a few individuals and families. ' A small coterie of individuals who, because of economic and other power, can influence measurably the policy of the Government. " ( page 272 ).
Elections, 1997 which show the percentage of turn out of the voters,, as under:
| | | | | --- | --- | --- | | Election | National Assembly | Provincial Assembly | | 1985 | 53.69% | 57.37% | | 1988 | 43.69% | 43.20% | | 1990 | 45.07% | 46.10% | | 1993 | 40.32% | 42.76% | | 1997 | 35.90% | 35.69% |
On the basis of these figures it was argued that there had been an alarming loss of interest by the people of Pakistan in the electoral process. We are not inclined to the view that anything will turn on the alleged turn out of voters during the past elections in so far as these cases are concerned. However, the general apathy and indifference is discernible and has a direct nexus with the unenviable performance of the former governments. Had appropriate steps been taken by the governments in the past to undo the damage done to the general thinking of the people as above, the things would have been totally different. Viewed in this perspective it cannot be lost sight of that the proportions which the misrule had taken beginning before the 12th of October. 1999 were to the discredit of all concerned.
?CHECKS AND BALANCES/ARTICLE 58(2)(b)
Muhammad Farooq contended that the 13th Amendment was passed by the Parliament unanimously because it was in the exercise of this arbitrary power by the President that all the four elected governments were sacked and in fact none of them was allowed to complete its tenure. Since for the successful working of a parliamentary form of Government the system of checks and balances has great importance, we would like to examine this aspect of the case in some detail in the light of case law and excerpts from various treatises.
"In the light of our discussions on the 18th instant I have examined the provisions of the 1973 Constitution and have made a number of suggestions for your consideration. They are enclosed herewith (five sheets)."
"No suggestions with regard to the Judiciary have been made as you have already done what I was proposing to suggest. I compliment you for the same."
"My introductory note prefacing the suggestions is self-explanatory but if any further elucidation is necessary I shall be happy to furnish the same."
"May Allah crown your efforts with success and guide you on the right path is my earnest prayer."
??????????????????????????????????? Yours sincerely
??????????????????????????????????? (Sd.)
??????????????????????? (Hamoodur Rehman)"
"My examination of the said Constitution reveals that although it is substantially a copy of the 1956 Constitution a deliberate departure has been made therefrom in order to render the President ineffective and vest the Prime Minister with absolute powers. This was ostensibly done to prevent a recurrence of the events, which took place during the Governor-General ship of Mr. Ghulam Muhammad and Lt.-Gen. Iskander Mirza but the teal purpose, as it now appears, was otherwise."
"Be that as it may the result achieved is that the President has been reduced to the position of a mere rubber-stamp while the Prime Minister has become all powerful with no one to check his whims and caprices. Recent events do also disclose that a Prime Minister with such vast powers can be more dangerous and far more ruthless, particularly, where there is no effective opposition in the legislature and the Civil Servants, without any Constitutional protection or security of service, are mere tools in the hands of the Prime Minister. If on top of this the Judiciary is also made ineffective as has been done by the 4th, 5th and 6th Amendments made in the Constitution, then the Prime Minister is nothing short of an absolute dictator."
"This is by no means a satisfactory situation. I am, Therefore, of the opinion that constitutional checks and balances are essential for the functioning of any Democratic system under a written Constitution, as under such a system there is no Crown with Prerogative powers to intervene."
"Power", it is said, "corrupts and absolute power corrupts absolutely", as has now been amply demonstrated by the revelations now being made of the misdeeds of the previous Government. Some changes are in my view, necessary to remove the imbalance between the powers of the President and Governor and the Prime Minister and Chief Minister in order to make the Heads of the Executive effective and to restore to them the prestige and dignity that should normally attach to such high offices without providing them with any incentive for aspiring to become dictators or to act in violation of the Constitution."
"I am also of the opinion that some provisions should be incorporated in the Constitution to ensure fair elections and to prevent the possibility of any large scale rigging of elections, as was witnessed in the recent past. The security of service of Public Servants should also be restored and the independence of the judiciary re-established."
"No suggestion with regard to Martial Law has been made but if so desired a new Article 258-A can be added on the lines of the Turkish pattern giving the President powers to impose Martial Law for a limited period which can only be extended by the National Assembly for a maximum period of say Six months."
Thus, Justice Hamoodur Rehman made suggestion for promulgation of Martial Law by the President for a limited period which could only be extended by the National Assembly for a maximum period of say six months and had also opined that such amendment was necessary so that Prime Minister does not become dictator, which ultimately led to the insertion of Article ~58(2)(b) in the Constitution by means of the 8th Amendment. However, 13th Amendment was adopted and all the powers vesting in the President by virtue of the 8th Amendment were deleted and the President was reduced to a mere cipher. The circumstances leading to 12th October, 1999 action prove that if that power continued to remain with the President, possibly the situation could have been averted.
260.-(1) Martial Law shall be declared in the whole or any part of Pakistan only in the most compelling circumstances, namely, when-
(a) the country is under attack or invasion by a foreign power, or is faced with imminent danger thereof; or
(b)??????? through serious and active uprising or otherwise the maintenance of law and order is placed in grave jeopardy, which the ordinary agencies are unable to deal with; or
(c)??????? a serious general problem affecting the whole, or any substantial part of the population, of the country or any Province, including a problem in relation to this Constitution, has arisen, which has proved incapable of resolution through constitutional, political or administrative agencies.
(2)??????? Where any of the circumstances enumerated in clause (1) of this Article are seen to exist, the Commander-in-Chief of the Pakistan Army, may at the request of the President, or of his own motion, but only after consultation with the President, declare, by order, that the whole or any part of Pakistan specified in the order shall be placed under Martial Law.
(3)??????? A declaration of Martial Law, whether made before or after the coming into force of this Constitution, shall be revoked only by the Commander-in-Chief of the Pakistan Army, who shall, before making the order of revocation, consult the President in that behalf.
(4)??????? It shall be within the power of the Commander-in-Chief of the Pakistan Army, who shall be the Chief Martial Law Administrator, to suspend for the duration of the Martial Law, or any shorter period as may be specified, the operation of specified provisions of this Constitution, but he shall not have power to abrogate this Constitution.
(5)??????? Subject to the provisions of clause (4) of this Article, the Chief Martial Law Administrator shall have power to promulgate necessary Martial Law Regulations and Orders during the period of continuance of Martial Law, and any Martial Law regulation may provide for the delegation by the Chief Martial Law Administrator of the power of making Martial Law Orders thereunder, to a subordinate Martial Law Authority.
(6)??????? Upon the revocation of a declaration of Martial Law, all Martial Law Regulations and Orders made during the continuance of such Martial Law shall cease to have effect, but the Chief Martial Law Administrator, after consultation with the President, may before such revocation declare that any specified Martial Law Regulation or Martial Law Order shall continue to have effect, notwithstanding the revocation of Martial Law, as a law of the appropriate Legislature, and such Martial Law Regulation or Martial Law Order shall continue to have effect accordingly.
"43. It is noteworthy that when in 1977 this Court was hearing the case of Begum Nusrat Bhutto Constitution of 1973 was in the field in which Article 58 was there in its original form without addition of sub-Article (2)(a)(b). Under Article 58 at that time President could dissolve National Assembly only when he was so advised by the Prime Minister. In such circumstances, the Court had to keep the factual background in view in connection with position enunciated in the Constitution particularly when there was no remedy provided to meet such an unforeseen situation with which the country and the Court were confronted. After a very careful and long hearing and examination of case-law on the subject and consideration of arguments advanced by both sides, this Court came to the conclusion which is succinctly summarised in the leading judgment of the learned Chief Justice at page 721 of the report which is reproduced as under:--
"The final position as emerging from this somewhat lengthy discussion of the various questions arising in this case may briefly be summed up as follows:
(i)???????? That the legal character and validity, of any abrupt political change, brought about in a manner not contemplated by the pre-existing Constitution or Legal Order, cannot be judged by the sole criterion, of its success or effectiveness, as contemplated by Kelsen's pure theory of law. Not only has this theory not been universally accepted, or applied, it is also open to serious criticism on the ground that, by making effectiveness of the political change as the sole condition or criterion of its legality, it excludes from consideration sociological factors or morality and justice which contribute to the acceptance or effectiveness of the new Legal Order. The legal consequences of such a change must, therefore, be determined by a consideration of the total, milieu in which the change is brought about, including the motivation of those responsible for the change, and the extent to which the old Legal Order is sought to be preserved or suppressed.
(ii)??????? That in any case the theory of revolutionary legality can have no application or relevance to a situation where the breach of legal continuity is a purely temporary nature and for a specified limited purpose. Such a phenomenon can more appropriately be described as one of Constitutional deviation rather than of revolution.
(iii)?????? That examined in this light, the Proclamation of Martial Law on the 5th of July, 1977, appears to be an extra-Constitutional step necessitated by the complete break-down and erosion of the Constitutional and moral authority of the Government of Mr. Z.A. Bhutto, as a result of the unprecedented protest movement launched by the Pakistan National Alliance against the alleged massive rigging of elections to the National Assembly, held on the 7th of March, 1977. It was a situation for which the Constitution provided no solution, and the Armed Forces had, therefore, to intervene to save the country from further chaos and bloodshed to safeguard its integrity and sovereignty, and to separate the warring factions which had brought the country to the brink of disaster.
(iv)?????? That the imposition of Martial Law, therefore, stands validated on the doctrine of necessity, and the Chief Martial Law Administrator is entitled to perform all such acts and promulgate all legislative measures which have been consistently recognised by judicial authorities as falling within the scope of the law of necessity.
(v)??????? That it has also become clear from a review of the events resulting in the culmination of Martial Law, and the declaration of intent made by the Chief Martial Law Administrator, that the 1973 Constitution still remains the supreme law, subject to the condition that certain parts thereof have been held in abeyance on account of State necessity; and the President of Pakistan as well as the Superior Courts continue to function under this Constitution. In other words, this is not a case where the old Legal Order has been completely suppressed or destroyed, but merely a case of Constitutional deviation for a temporary period and for a specified and limited objective, namely, the restoration of law and order and normalcy in the country, and the earliest possible holding of free and fair elections for the purpose of the restoration of democratic institutions under the 1973 Constitution.
(vi)?????? That, accordingly the superior courts continue to have the power of judicial review to judge the validity of any act or action of the Martial Law Authorities if challenged in the light of the principles underlying the law of necessity as set out in this judgment. Their powers under Article 199 of the Constitution thus remain available to their full extent, and may be exercised as heretofore, notwithstanding anything to the contrary contained in any Martial Law Regulation or Order, Presidential Order or Ordinance; and
(vii) That the provisions contained in clause (3) of Article 2 of the Laws (Continuance in Force) Order, 1977, suspending the right to enforce Fundamental Rights are valid for the reason that the situation prevailing in the country was obviously of such a nature as to amount to an emergency contemplated by clause (1) of Article 232 of the Constitution, and the right to enforce Fundamental Rights could, therefore, be legitimately suspended by an order of the kind which could have been made under clause (2) of Article 233 of the Constitution."
"44. It, therefore, follows from what is stated above that this Court in Begum Nusrat Bhutto's case held that imposition of Martial Law and promulgation of the Laws (Continuance in Force) Order were extra-Constitutional steps validated on the basis of doctrine of necessity in light of the fact that 1973 Constitution still remained the supreme law which was held in abeyance and not abrogated on account of State necessity. This arrangement was to last for a short time to enable the Government to hold elections as soon as possible. Superior Courts continued to have power of judicial review to judge the validity of any act or action of Martial Law Authorities if challenged in the light of principles underlying the law of necessity ????????????The question of oath also came up for consideration in the case of Begum Nusrat Bhutto and it was held with the consent of all the counsel appearing in the case that oath was not an obstacle in the way of Judges who were hearing that case. Discussion on this point is in the judgment of this case at page 674 of the report, which shows that both Mr. A.K. Brohi and Mr. Sharifuddin Pirzada were of the view that the new oath had not in any manner restricted the independence of the superior judiciary nor affected their obligation to perform their judicial functions according to law and it only indicated that superior judiciary, like rest of the country, had accepted the fact, which was even otherwise also evident that on 5th of July, 1977 a radical transformation took place in the pre-existing legal order. Mr. Yahya Bakhtiar, learned counsel for the petitioner in that case also joined the other two counsel and submitted that the oath did not in any way precluded the Judges from examining the question of the validity of the new legal order which could be decided in accordance with their conscience and the law."
"46. In the case of Begum Nusrat Bhutto Martial Law has been justified arid validated on the basis of doctrine of State necessity and actions taken by C.M.L.A. have been declared to be extra-Constitutional steps which have been given validation. Since there was deadlock between the Government and the Opposition parties and a situation had arisen in which no solution was in sight and the Constitution was also silent not providing for any remedy, in such circumstances there was no other way out except what was done by the Chief of the Army Staff who took over as C.M.L.A. and imposed Martial Law. This third Martial Law in the case of Begum Nusrat Bhutto was different from the two other Martial Laws as has been very ably pointed out by Mr. Justice Dr. Nasim Hasan Shah (as he then was) in his judgment in Begum Nusrat Bhutto's case that in the previous two Martial Laws the intervention was not only to suppress the exiting Constitutions which were abrogated but to replace them by .new Constitutions. Hence old legal order was replaced by new legal order but Martial Law in the case of Begum Nusrat Bhutto was intervention specifically providing that Constitution was not abrogated but held in abeyance and further expressing intention that elections would be held and Constitution would be revived. Relevant portion from his judgment at page 753 of the report is reproduced as under:
"In view of the break-down of the normal Constitutional machinery and to fill the vacuum, the Armed Forces were obliged to take an extra-Constitutional step. Martial Law was imposed, in the picturesque words used in the written statement filed by Mr. Brohi, not in order to disable the Constitutional authority but .in order to provide bridge to enable the country to return to the path of Constitutional rule. In the felicitous phrase of my Lord the Chief Justice, the act was more in the nature of a `Constitutional deviation' rather than an overthrow of the - Constitution. the Constitution of 1973 is not buried but merely suspended. It however, continues to be the governing instrument subject to the provisions of the Laws (Continuance in Force) Order, 1977. In these circumstances, neither the ratio decidendi of Dosso v. State nor that of Asma Jillani v. Punjab Government is strictly applicable to the present case."
"47. With regard to the objection that in the case, of Begum Nusrat Bhutto power was given to C.M.L.A. as one man to amend the Constitution which should not have been done. It appears that Chief of the Army Staff had taken over the governance. in his own hands as one man and imposed Martial Law. He could have abrogated the Constitution but he did not do so and instead held in abeyance and provided in the Laws (Continuance in Force) Order, 1977 that country would be governed as nearly as may be in accordance with the Constitution. His de facto status as such was later recognized by the Supreme Court ,in the judgment in the case of Begum Nusrat Bhutto as de jure and his actions were justified on the doctrine of State necessity and were treated as extra-Constitutional measures or Constitutional deviations. In fact he had amended the Constitution before final adjudication could be given by the Supreme Court in respect of validity of Martial Law. The situation was such that there was no Parliament and reins of the governance were in the hands of C.M.L.A. as one man. In such circumstances at the time of validation this Court allowed him the power to amend the Constitution on the basis of doctrine of State necessity as in any case Constitutional amendments, if any, made by him Would have to be approved and validated by the Legislature. This was done more or less on the same lines as allowed by the Federal Court of Pakistan in Reference No. l of 1955 (PLD 1955 FC 435). In that case it was held that issue raised referred to extraordinary powers of the Governor-General during normal times when the vital organ of the Constitution, namely, the Legislature was functioning and the question that had to be considered was whether there was any provision in the Constitution governing such a situation or any other legal principle within outside or above the Constitution Act which entitled the Governor-General to act in case of necessity of such a nature.
"48. Objection was also raised that in the case of Begum Nusrat Bhutto time-frame was not provided for holding the elections as promised by C.M.L.A. to the nation on the basis of which his take-over and Martial Law were justified as extra-Constitutional steps. This issue is adverted to by this Court in that judgment at pages 722 and 723 of the report. Mr. Yahya Bakhtiar, learned counsel for the petitioner, had expressed apprehension on the postponement of election schedule to be held on 18th October, 1977. Mr. A.K. Brohi, learned counsel for the respondent, Federal Government, while responding informed the Court that C:M.L.A. intended to hold election as soon as process of accountability of the holders of the public offices was completed and the time factor depended upon the speed with which those cases were disposed of by the Civil Courts. Mr. Sharifuddin Pirzada, the learned Attorney-General stated at the Bar that in his opinion a period of about six months was needed for the purpose and thereafter it would be possible to hold elections within two months. It was held by the Court that it did not consider appropriate to issue any directions as to a definite time-table for holding of elections but made observation that the Court had found possible to validate the extra-Constitutional actions of C.M.L.A not only for the reason that he stepped in to save the country at. the time of grave national crisis and Constitutional breakdown but also because of the solemn pledge given by him that the period of Constitutional deviation shall be of as a short duration possible and during that period all his energies shall be directed towards creating conditions conducive to the holding of free and fair elections leading to the restoration of democratic rule in accordance with the dictates of the Constitution. The Court therefore expected the Chief Martial Law Administrator to redeem his pledge which had to be construed in the nature of mandate from the people of Pakistan, he had by and large willingly accepted his administration as the interim Government of Pakistan. This judgment was announced on 10-11-1977 after which many developments took place and if there .was any grievance on account of this fact that elections were not held within a reasonable time as observed by this Court then the record shows that no review was filed agitating that judgment.
"49. During the hearing of cases under consideration question was raised that there is no discussion in the judgment with regard to the power of amendment of Constitution conferred on C.M.L.A. and in that connection it has been pointed out that in the leading judgment in the findings summarised at page 721 of the report under the heading of "final position" under 'sub-heading (iv) it is mentioned that Chief Martial Law Administrator is entitled to perform all such acts and promulgate all legislative measures which have been consistently 'recognized by judicial authorities as fallen within the scope of law of necessity. In this sub heading (iv) words "to amend the Constitution" are not mentioned which are mentioned specifically at page 716 of the report under the sub-heading (iii) (a) which are also findings mentioned at page 715 of the report under the heading of "the true legal position which, therefore, emerges". In this connection, it was further stated before us that the original record shows that colour of typed pages 94 to 100 is different from the remaining pages. We have checked the original record which shows that pages 94 to 100 are of brighter white colour than remaining pages which are off white. Then again pages 102 and 103 are also of brighter white colour and likewise page 108 is also of brighter white colour. Now, this change in the colour of few pages in the original judgment does not show that these pages were replaced as it can so happen in the ordinary course as well. We have seen judgments of other learned Judges in the main original file which show that both kinds of paper, as mentioned above, have been used.
Each page of leading judgment is, initialed by the late Chief Justice. Mr. Sharifuddin Pirzada, who was Attorney-General at the-relevant time and appeared before the Court, on our query stated that question with regard to the power of C.M.L.A. to amend the constitution was raised and discussed before the Court. We are also of the' view that it must have been discussed because during the pendency of Constitutional petition before this Court amendment was made, in the Constitution -by the C.M.L.A. in consequence whereof Chief Justice Muhammad Yaqub Ali had to retire. Out of nine learned Judges who heard that case five learned Judges had contributed long judgments and the remaining Judges as well have appended short notes agreeing with the judgment of the Chief Justice or other Judges. No other Judge had said that this question with regard to the power to C.M.L.A. to amend the Constitution was not agitated and discussed before the Bench in the Court. We are completely satisfied that this question was raised and answered in an appropriate manner and change in the colour of papers in the judgment does not indicate anything which is unusual and not proper.
"50. Now we come to post judgment developments which took place after the announcement of judgment in the case of Begum Nusrat Bhutto leading to the Eighth Amendment which has been called in question before us. Judgment in the case was announced on 10-11-1977 after which Provisional Constitution .Order was promulgated on 24-3-1981. his is also called PCO in short form. This Order on perusal shows that at the beginning it has explanatory statement manifesting intention behind asking such Order. It mentions that 1973 Constitution was in force and on 5th July, 1977, Martial Law was imposed and that Constitution was held in abeyance. It also says that C.M.L.A. has announced that democracy and representative institutions shall be restored as soon as possible and until then interim measures were being adopted. It also speaks about the fact that the Laws (Continuance in Force) ?? Order, 1977 was made by C.M.L.A. on the same day when Martial Law was proclaimed but some doubts had arisen as to the effect of the said Order as regards the power and jurisdiction of the Superior Courts hence for that reason and also for the reason that integrity and sovereignty of Pakistan and its Islamic Ideology were threatened hence need was felt to promulgate this PCO.
"51. It. is already held in the judgment in the case of Begum Nusrat Bhutto that taking of oath does not detract Judge from performing his duties and functions as a Judge. Contents of PCO does not show that Constitution of 1973 is buried or forgotten for ever and a new grund norm had started.
"58. We are, therefore, of considered view that Eighth Amendment including Article 58(2)(b) has come to stay in the Constitution as permanent feature. It is open to the Parliament to make amendment to the Constitution of any provision of the Eighth Amendment as contemplated under Article 239 as long as basic characteristics of federalism, parliamentary democracy and Islamic provisions as envisaged in the Objectives Resolution/Preamble to the Constitution of 1973 which now stands as substantive part of the Constitution in the shape of Article 2A are not touched.
At page 499 of the report, it was observed:
"Mr. Syed SharifuddinPirzada has referred to the. book `Politics in Pakistan The nature and Direction of Change' by Khalid B. Sayeed in which the following comment on the basic aspect of the Constitution of 1973 has been made: -
"All this clearly indicated that the Prime Minister could neither be controlled. by the President nor challenged by the Assembly. The latter feature was extraordinary because the essence of Parliamentary Government was that a Prime Minister was both accountable to arid removable by the Assembly. As suggested in Chapter 3, and as it has often been remarked the Government of Pakistan under Ayub was that of the President, by the President and for the President. Could it be said that in the Bhutto regime the Prime Minister's position was equally dominant?
"It. seemed that Bhutto was not satisfied even with the power of the Prime Minister that was available to him through the Constitution. During 1975-76, he had started thinking of bringing the Parliamentary system under still greater control of the Prime Minister so that he could push certain pieces of legislation through the Parliament with practically no delay or obstruction. This was disclosed to the author by Leslie Wolf Phillips of the Department of Government, London School of Economics and Political Science, who had been invited by the Prime Minister to advise him on how to change the Constitution along these lines.
In January 1976, the Prime Minister told Wolf-Phillips that he had made up his, mind about converting the .present system into a Presidential system. However, he expected that this would be brought about after the election. It may be noted that there was some speculation in Pakistan during the National Assembly Elections of 1977 that Bhutto was eager to win these elections by a landslide because he wanted a two-third majority in the Assembly for the purpose of amending the Constitution along Presidential lines.
One of the provisions discussed and explored by Wolf-Phillips related to a clause being inserted in the Constitution under which a candidate standing for. National Assembly Election would have to announce his intention of supporting a particular candidate for the presidency. According to Wolf-Phillips, the report that he submitted to the Prime Minister was interpreted by the Prime Minister as one not very helpful to his contemplated efforts to convert the Constitution into a Presidential form.'
Similar view has been expressed by Stanely Wolpert in his book Zulfi Bhutto of Pakistan - His Life and Times' and Mr. Altaf Gauhar in his Article 'Bhutto and Parliamentary Democracy-' published in. theNation' dated 6.12.1996.
28.?????? The Constitution as framed in 1973 was Parliamentary in form but it was Prime Ministerial in character. The turbulent Constitutional history of Pakistan has not built any basic structure. The principles of democracy, rule of law, equality and justice as- propounded in Objectives Resolution have been advocated, propagated and, utilized for achieving political power equally by the politicians, Army rulers and even representatives of the people as well."
At page 518 of the above report, it was observed:
"51. Mr. Syed Sharifuddin Pirzada has contended that the Eighth Amendment has introduced checks and balances between the power of the President and the Prime Minister. As discussed above, the Constitution of 1973 had vested- supreme power to the Prime Minister and though democratic in form it was Prime Minister in character. Amendments made in Articles 48, 58, 91 and 92 have curtailed the power of the Prime Minister and have strengthened the hand of the President. In a democratic system check and balance is provided to avoid autocratic rule and to provide balance of power for a proper functioning of the Government according to the Constitution. No doubt the amendments particularly Article 58(2)(b) have titled the balance in favour of the President, yet this Court has structured and circumscribed the discretionary power of dissolution. One reason given in favour of Article 58(2)(b) is that it prevents Constitutional deviation. This seems to be plausible because when Government of the Federation cannot be carried on in accordance with the provisions of the Constitution and an appeal to the electorate is necessary, the President may exercise his power before any person, agency or authority taking advantage of such situation strikes not at the Assembly but at the Constitution. One may comment `that to save the Constitution, Assembly is dissolved. The exercise of power under Article 58(2)(b) or Constitutional deviation can be avoided not by the letters of the Constitution but by political ethic, morality and maturity. Unless a responsible Government exists which has respect for law, opportunity shall continue to be provided for Constitutional strike."
53.?????? It has also been pointed out that the controversy involves political question which the Courts should avoid to decide. The contention is more relevant with reference to the balance of power between the President and the Prime Minister. Such question is a political question to be decided by the Constituent Power. It therefore, requires determination of what is a political question. A political question is one which because of its political sensitivity is not fit for adjudication by the Court or the Constitution requires it to be determined finally by any other organ of the State. This `political question doctrine' is based on the respect for the Constitutional provisions relating to separation of power among the organs of the State. But where. in a case the Court has jurisdiction to exercise power of judicial review, the fact that it involves political question, cannot compel the Court to refuse its determination."
"54. For the foregoing reasons, the appeals and petitions were dismissed by the following short order, which forms part of this Judgment :-
For reasons to be recorded later, we pass following short order;
(2)??????? What is the basic structure of the Constitution is a question of academic nature which cannot be answered authoritatively with a touch of finality but it can be said that the prominent characteristics of the Constitution are amply. reflected in the Objectives Resolution which is now substantive part of the Constitution as Article 2A inserted by the Eighth Amendment.
(3)??????? The Objective Resolution was Preamble of the Constitutions made and promulgated in our country in 1956, 1962 and 1973. Perusal of the Objectives Resolution shows that for scheme of governance the main features envisaged are Federalism and Parliamentary Form of Government blended with Islamic provisions. The Eighth Amendment was inserted in the Constitution in 1985, after which three elections were held on party-basis and the resultant Parliaments did not touch this Amendment, which demonstrates amply that this Amendment is ratified by implications and has come to stay in the Constitution unless amended in the manner prescribed in the Constitution as contemplated under Article 239. Article 58(2)(b) brought in the Constitution by the Eighth Amendment,. which maintains Parliamentary Form of Government has provided checks and balances between the powers of the President and the Prime Minister to let the system work without let or hindrance to forestall a situation in which martial law could be imposed. "
"Ministers of the Crown are expected to behave according to the highest standards of constitutional and personal conduct. In particular they must observe the following principles of ministerial conduct:
(i)???????? Ministers must ensure that no conflict arises, or appears to arise, between their public duties and their private interests;
(ii)??????? Ministers must not mislead Parliament.. They must be as open as possible with Parliament and the public;
(iii)?????? Ministers are accountable to Parliament for the policies and operations of their departments and agencies;
(iv)?????? Ministers should avoid accepting any gift. or hospitalitywhich might, or might appear to compromise their judgment or place them under an improper obligation;
(v)??????? Ministers in the House of Commons trust keep separate their rules as Minister and constituency Member; '
(vi)?????? Ministers must keep their party and ministerial rules separate. They must not ask civil servants to carry out party political duties or to act in any other way that would conflict with the Civil Service Code.
Reference may also be made to the book titled "The Hidden Wiring" Unearthing the British Constitution by Peter Hennessy, wherein at pages 35 and 37 of the book, it is observed:-
"This paragraph is by any standards more than tips for beginners' oretiquette'. Accountability plus responsibility plus openness is-or should be-an absolutely fundamental constitutional requirement, especially as under British arrangements the executive and the legislature are fused in such a fashion that the balance of power is heavily tilted in favour of the executive, not least in the interpretation of the rules of the game (i.e. the constitution)."
"Indeed,, procedure is all the Constitution the poor Briton has, now that any Government which command [sic] 51 per cent of the House can at any moment do anything they like, with retrospective or prospective intention. This in itself was an intriguing pre-echo of Lord Hailsham's `elective dictatorship' theory some sixteen years ahead of its actual expression.".
"In a nation without a written constitution and bereft of formal checks and .balances, confidence is a crucial ingredient, one of the key bonding agents that holds (or should hold) the entire stricture together. Another, as we have seen, is the notion of the Crown. Though monarchy outstrips all the other sides to our golden pentagon, it is only in terms of a relative back of tarnish, not an abundance of sheen. And it is to this, the most ancient institution of state, that I shall turn first."
Also refer to the following passages from the book "Arthur Berriedale Keith" The Chief - Ornament Of Scottish Learning" by Ridgway F. Shinn Jr. :-
"The Constitution under Strain"
"In 1942, Keith brought-out a pamphlet in which he stated his views about why and how the constitution was threatened. Iii this, The Constitution under Strain: Its Working from the Crisis of 1938 down to the Present Time, he built upon and expanded, the final chapter which he had written in 1939 for his book on the British cabinet. Certainly, the title he chose reflected one theme which he saw as of primary concern in these years, that is, the ways in which, under successive leaders, the constitution had been twisted and turned in what he thought were- dangerous new ways.
"A Government with so much power in its hands and led, in his view, by a discredited Prime Minister, was likely to order the business of the day in a manner which precluded careful consideration of various aspects of legislation. Why should such a ministry bother to take time for debate? Keith felt that, in softie senses, such unrestrained power in the hands of the National Government was almost as dangerous to Constitutional Government in Britain as Hitler's absolute control of the machinery of the Weimar Republic was to German democracy.
"If there had' been, effective Opposition, Keith felt that some egregious blunders must certainly have been avoided; in the absence of such constitutional balance, the Government could make serious mistakes and survive, and it did."
Reference be also made to the following passages from the book titled "The English Constitution" by Walter Bagehot :
"With the coming of Prime-Ministerial Government, the Cabinet, in obedience to the law that Bagehot discovered, joins the other dignified elements in the Constitution. Of course, like the Monarchy, the House of Lords and the Commons, it retains very real reserve powers which can on occasion be suddenly and dramatically used for good or for ill. A Prime Minister, for instance, can be unseated by his colleagues; and it this fact with which the constitutional purists seek to justify the distinction they still make between Presidential and Prime Ministerial Government. A President, we are told, cannot be removed before the end of his term of office; a Prime Minister can be.
"The distinction is valid, provided we observe that a British party leader exerts such power and patronage within the machine that he can never be removed in real life by public, constitutional procedure. The method employed must. always be that of undercover intrigue and sudden unpredicted coup d'etat. The intra-?party struggle for power that is fought in the secret committees, and in the lobbies, may suddenly flare up round the Cabinet table. But if it does, the proceedings there will only be a ritual, and the real fight will have finished before they begin."
RIDICULING THE JUDICIARY
The debates of the Parliament for the relevant period clearly demonstrate that the integrity and independence of the Judiciary of. Pakistan were. challenged which had the effect of defaming and bringing the Judges into ridicule. The observations made in the Short Order to the effect that "where the Judiciary was ridiculed, leaving no stone unturned to disparage and malign it by making derogatory and contemptuous speeches by some of B the members of the previous ruling party inside and outside the Parliament B and no Reference was made to the" Chief Election Commissioner for their disqualification as` members of the Parliament under Article 63 (2) of the Constitution; where the disparaging remarks against the Judiciary crossed all limits with the rendering of judgment by this Court in the case of Sh. Liaquat Hussain v. Federation of Pakistan PLD 1999 SC 504, declaring the establishment of Military Courts as ultra vires the Constitution, which resulted into a slanderous campaign against the Judiciary launched by the former Prime Minister registering his helplessness in the face of the Judiciary not allowing him the establishment of Military Courts as a mode of speedy justice; where the image of the Judiciary was tarnished under a well-?conceived design" are fully supported by the material on record which we have carefully scanned.
We also take judicial notice of the fact that I the decision of this Court in Liaqat Hussain's case was. treated by the former Prime Minister, his government and supporters as a stumbling block in their way and consequently the Judiciary was maligned all over again through electronic media under the control of the Prime Minister. The Pakistan Television often showed bereaved old women pleading delay in justice and discontentment with the judicial system of the country whereby the image of the Judiciary was attempted to be tarnished under a well-conceived design.
The statements made by the former Prime Minister and the members of his Government in and outside the Parliament hardly support the plea of Mr. Khalid Anwar that the former Government had great regard for the Judiciary. We have also seen the material placed on record relating to tapping of telephones and eavesdropping which clearly establishes that the telephones of the Judges of the Superior Courts and other personalities were tapped. It is indeed very shocking particularly, because this Court in the case of Mohtarma Benazir Bhutto (supra) declared such acts as most detestable, immoral, illegal and unconstitutional.
??????????? DOCTRINE OF NECESSITY
After perusing the voluminous record and after considering the submissions made by the parties, we are of the view that the machinery of the Government at the Centre and the Provinces had completely broken down and the Constitution had been rendered unworkable. A situation arose for which the Constitution provided no solution and the Armed Forces had to intervene to save the State from further chaos, for maintenance of peace and order, economic stability, justice and good governance and to safeguard integrity and sovereignty of the country dictated by highest considerations of State necessity and welfare of the people. The impugned action was spontaneously welcomed by all sections of the society.
We see no force in the submission of Mr. Khalid Anwar that the doctrine of necessity' has since been buried long ago by the British Courts, there was no justification for its resurrection as done in Special Reference No. 1 of 195> (supra) and m the case of Begum Nusrat Bhutto (supra). Suffice it to say that the precedents from foreign jurisdiction. though entitled to reverence and respect but are not ipso facto applicable to the facts and circumstances prevailing on 12th October, 1999. In such matters of extra constitutional nature, in order to save and maintain the integrity, sovereignty and stability of the country and having regard to the welfare of the people which is of paramount consideration for the
Judiciary, while interpreting the impugned legislative instruments we have to make every attempt to save "what institutional values remained to be saved" with a view to maintaining and upholding the independence of Judiciary which in turn would protect the State fabric and guarantee Human/Fundamental Rights. We are also not inclined to agree with M/s. Anwar and Farooq that thedoctrine of necessity' was rejected in the case of Liaquat Hussain (supra). As a matter of fact this question was not directly in issue. It was only obliquely referred to in the context of establishment of Military Courts in terms of Article 245(1) of the Constitution. It was not a case where the vires of any extra constitutional measure resulting in the change of the government's structure were involved. Be that as it may, one of us (Irshad Hasan Khan, J. as he then was) (now the Chief Justice), specifically took the view that the prerequisites for the application of doctrine of necessity' were not satisfied in upholding the establishment of Military Courts in the purported exercise of power under
Article 245 (1) of the Constitution even for a limited period. it was also observed that the prerequisites of thedoctrine of necessity' have been laid down in the cases of Mustafa Ibrahim as well as Begum Nusrat Bhutto (supra).
For facility of reference the following passages from the case of Liaquat
Hussain (supra) may be reproduced as under: ?
"58. The plea raised on behalf of the learned Attorney-General that the Doctrine of Necessity is not outdated and can be invoked in the present case for a `limited purpose' cannot be countenanced, for, if .it is approved of, it may, very frequently be resorted to at the incidence of a situation presently prevailing in the country, by the Executive. In tact, such approval whereby the Executive is allowed to cross the barriers of Constitutional provisions at its whim, would turn a democratic rule into a despotic one. Clearly, any deviation from the Constitution may lead to anarchy. It is true that the take over by the Chief of the Army Staff as Martial Law Administrator was validated by this Court in Begum Nusrat Bhutto's case PLD 1977 SC 657 wherein it was inter alia observed:-
`On no principles of necessity could power of judicial review vested in the Superior Courts under the 1973 Constitution, be taken away' (p.716 last para. extending to page 717).
"However, in the case of Asma Jilani (supra), this Court took the view that the acts of usurper may be condoned and/or validated by the application of the law of necessity. Viewed from this angle, the impugned Ordinance being ultra vires the Constitution cannot be validated even on the touchstone of State necessity. Additionally, in view of the plea raised by the learned Attorney-General that the establishment of Military Courts is spelt out from the power vesting in the Federal Government under Article 245 is contradictory with the theory of State necessity, inasmuch as, the concept of law of necessity, would arise only if an act which would otherwise be illegal becomes legal if it is done bona fide, in view of State necessity, with a view to preserving the State or the society from destruction ???..In the instant case, we have no doubt that the impugned Ordinance was issued bona fide with a view to suppress the menace of terrorism. Nevertheless, the constitutionality of the Ordinance is not to be judged on the question of bona fides of the Federal Government simpliciter but on the touchstone of the Constitutional provisions. Here, impugned legislation is ultra vires the Constitution in so far as it takes away the functions of the Courts in determining the guilt or innocence of an accused. Be that as it may, the prerequisites for the application of Doctrine of Necessity are not satisfied in the instant case for upholding the impugned legislation, even for a limited period. The prerequisites, as laid down in the case of Attorney-General of Republic v. Mustafa Ibrahim 1964 CLR 195, which was also referred in the Begum Nusrat Bhutto's case (supra), are:-
(a)??????? An imperative and inevitable necessity or exceptional circumstances;
(b)??????? no other remedy to apply;
(c)??????? the measure taken must be proportionate to the necessity; and
(d)??????? it must be of a temporary character limited to the duration of the exceptional circumstance- '
"In the instant case, the Courts are functioning and the question of backlog and expeditious disposal of terrorists' case can be remedied by taking effective measures, in the light of the guidelines provided by this Court in the short order as well as the recommendations in the concluding paragraphs of this note. The Courts are functioning properly and administering justice according to the Constitution and the law.'
A perusal of the above quoted passages shows that in the circumstances of the case and having regard to the provisions of the Constitution and in view of the situation then prevailing, doctrine of necessity was not. attracted and that in this view of the matter Ordinance under. which the Military Courts were set up, being a sub-constitutional legislation could not be saved and was, therefore, declared ultra vires the Constitution. Contrary to the above case, the Court is here faced with an extra-constitutional situation and all the elements described by this Court in the aforesaid case viz., inevitable necessity, exceptional circumstances, no other remedy to apply, measure taken must be proportionate to the necessity and it must be of temporary character, limited to the duration of exceptional circumstances, are present, inasmuch as, the Constitution provided no F solution to meet the extraordinary situation prevailing on 12th October, F 1999. As such, the above case is no hurdle.
As to the plea raised by Mr.
Khalid Anwar that the doctrine of necessity' is accepted as a defence in criminal prosecution and tortuous acts which concept is different from that ofState necessity', suffice it to say that this Court in the case of Begum
Nusrat Bhutto (supra) approved the doctrine of State necessity' and laid down the conditions precedent for invoking the same. Therefore, the distinction pointed out by Mr. Khalid Anwar regarding the concept ofdoctrine of necessity' and that of State necessity' is immaterial. The fact remains that this Court is of the considered view that intervention by the Armed Forces on 12th October, 1999 was an imperative and inevitable necessity in view of the exceptional G circumstances prevailing at that- time and, therefore, there is no valid G justification for not validating the extra constitutional measure of the Armed Forces on the technical distinction betweendoctrine of necessity' and the `doctrine of State necessity'.
It would be instructive to refer to the following passages from the book titled The Classics Of International Law, by Hugo Grotius:
"What view is to be taken in case of extreme and in other respects unavoidable necessity.
Danger to life breaks the Sabbath. In Synesius, again, a Jew presents this excuse for having violated the law of the' Sabbath:We were exposed to imminent danger of death.'"This exception was approved by Christ, as also an exception in the case of another law, which forbade the eating of shewbread. The Jewish rabbis, in accordance with an ancient tradition, admit a similar exception in the case of the law forbidding the use of certain articles of food, and in some other cases; and rightly so. This does not mean that God has not the right to oblige us to submit ourselves to certain death; it does mean that since these are some laws of such a nature, we are not to believe that they were given with so inflexible an intent. The same principle holds even more manifestly in the case of human laws.
"2. I do not deny that even according to human law certain acts of a moral nature can be ordered which expose one to a sure danger of death; an example is the order not to leave one's post. We are not, however, rashly to 'assume that such was the purpose of him who laid down the law; and it is apparent that men would not have received so drastic a law applying to themselves and others except as constrained by extreme necessity. For laws are formulated by men and ought to be formulated with an- appreciation of human frailty."
"Now this law which we are discussing-the law of non?resistance-seems to draw its validity from the will of those who associate themselves together in the first place to form a civil society; from the same source, furthermore, derives the right which passes into the hands of those who govern. If these men could be asked whether they purposed to impose upon all persons the obligation to prefer death rather than under any circumstances to take up arms in order to ward off the violence of those having superior authority, I do not know whether they would answer in the affirmative, unless, perhaps, with this qualification, in case resistance could not be made without a very great disturbance in the state, and without the destruction of a great many innocent people. I do not doubt that to human law also there can be applied what love under such circumstances would commend."
"3.??????? Some one may say that this strict obligation, to suffer death rather than at any time to ward off any kind of wrong-doing on he part of those possessing superior authority, has its origin not in human but in divine law. It must be noted, however, that in the first instance men joined themselves together to form a civil society not by command of God, but of their own free-will, being influenced by their experience of the weakness of isolated households against attack. From this origin the civil power is derived, and so Peter calls this an ordinance of man. Elsewhere, however, it is also called a divine ordinance, because God approved an institution which was beneficial to mankind. God is to be thought of as approving a human law, however, only as human and imposed after the manner of men."
"4.??????? Barclay, though a very' staunch Advocate of kingly authority, nevertheless comes down to this point, that he concedes to the people, and to a notable portion of the people, the right of self-?defence against atrocious cruelty, despite the fact that he admits that the entire people is subject to the king. I readily understand that in proportion as that which is preserved is of greater importance, the equity of admitting an exception to the letter of a law is increased. But on the other hand I should hardly dare indiscriminately to condemn either individuals, or a minority which at length availed itself of the last resource of necessity in such a way as meanwhile not to abandon consideration of the common good. "
"That the right to make war may be conceded against him who has the chief authority among a free people.
"First, then, if rulers responsible to the people, whether such power was conferred at the beginning or under a later arrangement as at Sparta-if such rulers transgress against the laws and the state, not only can they be resisted by force, but, in case of necessity, they can be punished with death. An example is the case of Pausanias, king of the Lacedaemonians. And since the earliest kingships of Italy were of this character, it. is surprising that, after narrating the exceedingly dreadful crimes of Mezentius, Virgil adds:
Then all Etruria in just anger rose;
'The punishment of death forthwith demand
They for their king."
"That in case of necessity men have the right to use things which have become the property of another, and whence this right comes
"1.??????? Now let us see whether men in general possess any right over things which have already become the property of another. Some perchance may think it strange that this question should be raised, since the right of private ownership seems completely to have absorbed the right which had its origin in a state of community of property. Such, however, is not the case. We must, in fact, consider what the intention was of those who first introduced individual ownership; and we are forced to believe that it was their intention to depart as little as possible from natural equity For as in this sense even written laws are to be interpreted, much more should such a -point of view prevail in the interpretation of usages which are not held to exact statement by the limitations of a written form. "
"2.??????? Hence it follows, first, that in direst need the primitive right of user revives, as if community of ownership had remained, since in respect to all human laws-the law of ownership included-supreme necessity seems to have been excepted.
"3.??????? Hence it follows, again, that on a voyage, if provisions fail, whatever each person has ought to be contributed to the common stock. Thus, again, if fire has broken out, in order - to protect a building belonging to me I can destroy a building of my neighbour. I can, furthermore, cut the ropes or nets in which my ship has been caught, if it cannot otherwise be freed. None of these rules was introduced by the civil law, but they have all come into existence through interpretations of it."
"4.??????? Even among the theologians the principles has been accepted that, if a man under stress of such necessity takes from the property of another what is necessary to preserve his own life, he does not commit a theft."
"The reason which lies back of this principle is not, as some allege, that the owner of a thing is bound by the rule of love to give to him who lacks; it is, rather, that all things seem to have been distributed to individual owners with a benign reservation in favour of the primitive right. For it those who made the original distribution had been asked what they thought about this matter they would have given the same answer that we do. Necessity,' says Seneca the father,the great resource of human weakness, breaks every law. meaning, of course, human law, or law constituted after the fashion of human law. Cicero in his eleventh
Philippic averred: Cassius has set out for Syria, a province belonging to another, if men observed written laws; but since these have been suppressed, it becomes his province by the law of nature.' In Curtius we read:In a common disaster each man has whatever falls to his lot.'
"That the right, in case of necessity, to use things belonging to others, holds when the necessity is in no way avoidable.
"Administrations, however, must be kept in mind, that this permission to use property belonging to another may not be carried beyond proper limits."
"The first is, that every effort should be made to see whether the necessity can be avoided in any other way, as. for example, by appealing to a Magistrate, or even by trying through entreaties to obtain the use of the thing from the owner. Plato authorizes the taking of water from a neighbour's well only in case one in search of water has dug on his own land clear to the underlying stratum of chalk. Solon gives such authorization only in case one has dug on his own land to a depth of forty cubits; in regard to Solon's rule Plutarch adds: He thought to minister to need, not to show indulgence to laziness.' In his answer to the people of
Sinope Xenophon said:Wherever the right to purchase is not granted to us, whether on Greek or on barbarian soil, we take what we have need of, not from lawlessness but from necessity.'
"That the right, in case of necessity, to use things belonging to another, holds except when the possessor has equal need.
"In the second place, this right cannot be conceded if the owner himself is under an equal necessity; for in like circumstances the position of the owner gives him the preference. He is not foolish', says Lactantius,who has not, even for his own safety, pushed a shipwrecked man from his plank, or a wounded man from his horse; for he has kept himself from the inflicting of an injury, which would be a sin and to avoid such a sin is wisdom.' Cicero had said in his third book On Duties:
should not the wise .man, therefore, if he is exhausted with hunger, take food away from another man who is of no account? By no means. For my life is no more precious to me than the possession of such a spirit that I would not harm any one for the sake of my own advantage? In Curtius we read:The man who will not part with his own has a better case than the man who demands what belongs to another.'
"That there is, further, an obligation to restore the things of another used in case of necessity, whenever restoration shall be possible
"In the third place, restitution of another's property which has been used in case of necessity must be made whenever this can be done."
"There are some who hold a different opinion. Their plea is, that the man who has availed himself of his own right is not bound to make restitution. But it is nearer the truth to say, that the right here was not absolute, but was- restricted by the burden of making restitution, where necessity allowed. Such a right is adequate to maintain natural. equity against any hardship occasioned by private ownership. "
"Application of this right in the case of wars.
"From what has been said we can understand how it is permissible for one who is waging a just war to take possession of a place situated in a country free from hostilities. Such procedure, of course, implies these conditions, that there is not an imaginary but a real danger that the enemy will seize the place and cause irreparable damage; further, that nothing be taken except what is necessary for protection, such as the mere guarding of the place, the legal jurisdiction and revenues being left to the rightful owner; and, finally, that possession be had with the intention of restoring the place as soon as the necessity has ceased."
`Henna was retained by an act either culpable, or justified by necessity,' says Livy; for whatever departs in the least degree from necessity is culpable. When the Greeks who were with Xenophon were in pressing need of ships, on the advice of Xenophon himself they seized the vessels that were passing by, yet took possession in such a way that they kept the cargoes unharmed for the owners, furnished provisions also to the sailors, and paid passage money."
"The first right then that, since the establishment of private ownership, still remains over from the old community of property, that which we have called the right of necessity."
"That men possess the right to use things which have become the property of another, for a purpose which involves no detriment to the owner.
"A second right is that of innocent use.
Why,' says Cicero,when a man can do so without loss to himself, should he not share with another things that are useful to the recipient and can be spared without annoyance to the give?'
Thus Seneca declares that opportunity to get a light for a fire is not to be considered a favour. In Plutarch we read the following, in the seventh book of his symposiacs: `It is not right for us to destroy food, when we ourselves have more than enough; or to stop up or conceal, a spring, when we have drunk all we wanted; or to obliterate the signs which mark the route for ships, or signs on land which have been useful to us.'
"Hence the right to the use of running water.
"Thus, a river, viewed as a stream, is the property of the people through whose territory if flows, or of the ruler under whose sway that people is. It is permissible for the people or king to run a pier out into it, and to them all things produced in the river belong. But the same river, viewed as running water, has remained common property, so that any one may drink or draw water from it."
Who would forbid from lighted torch alight
To take, and guarded hold in hollow sea
The waters vast?
Says Ovid. In the same author Latona, thus, addresses the Lycians:
Why water, me deny? Common to all. The use of water is.
"There also he calls the waves a public blessing, that is a blessing common to mankind, using a less appropriate meaning of the word `public'. In that sense certain things are said to be public by the law of nations; and with this meaning Virgil referred to the wave as open to all men."
"There are indeed two memorable instances on record, in which Parliament have assembled without the authority of the King; and have, when so assembled, effected most momentous revolutions in the Government. I allude to the Parliament which restored Charles 2; and the Parliament of 1688 which .disposed of the British Crown to William III. But in both these instances the necessity. of the case rendered it necessary for the Parliament to meet as they did, there being no King to call them together, and necessity supersedes all law. Nor is it an exception to this rule, that by some modern statutes (b) on the demise of the King or Queen (which at common law dissolved the Parliament, because it could no longer consult with him who called it) (c), the Parliament then in being or otherwise the last Parliament shall revive or sit, and continue for six months after such demise, unless sooner prorogued or dissolved by the successor; that is, if the Parliament be at the time of the King's death separated by adjournment or prorogation, it shall notwithstanding assemble immediately; or, if no parliament be then in being, the members of the last Parliament shall assemble and be again a Parliament. For in such case, the revived Parliament must have been originally summoned by the Crown."
"49. The Court will now consider the question of whether there was, in 1989, a state of necessity which would have permitted. Hungary, without incurring international responsibility, to suspend and abandon works that it was committed to perform in accordance -with the 1977 Treaty and related instruments.
"50. In the present case, the Parties are in agreement in considering that the existence of a state of necessity must be evaluated in the light of the criteria laid down by the International Law Commission in Article 33 of the Draft Articles on the International Responsibility of States that it adopted on first reading. That provision is worded as follows : .
Article 33. State of Necessity
1.???????? A state of necessity may not be invoked by a State as a ground for precluding the wrongfulness of an act of that ' State not in conformity with an international obligation of the State unless:
(a)??????? the act was the only means of safeguarding an essential interest of the State against a grave and imminent peril; and
(b)??????? the act did not seriously impair an essential interest of the State towards which the obligation existed. .
(a)??????? if the international obligation with which the art of the State is not in conformity arises out of a peremptory norm of general international law; or
(b)??????? if the international obligation with which the act of the State is not in. conformity is laid down by a treaty which, explicitly or implicitly, excludes the possibility of invoking the state of necessity with respect to that obligation; or
(c)??????? if the State in question has contributed to the occurrence of the state of necessity." (Yearbook of the International Law Commission, 1980, Vo1.lI, Part 2, p.34)
In its Commentary, the Commission defined the `state of necessity' as being
`that situation of a State whose means of safeguarding an essential interest threatened by a grave and imminent peril is to adopt conduct not in conformity with what is required of it by an international obligation to another State" (ibid, para. l).
It concluded that `the notion of state of -necessity is. . . deeply rooted in general legal thinking' (ibid, p. 49, para. 31).
51.? The Court considers, first of all, that the state of necessity is a ground recognized by customary international law for precluding the wrongfulness of an act not in conformity with an international obligation. It observes moreover that such ground for precluding wrongfulness can only be accepted on an exceptional basis. The International Law Commission was of the same opinion when it explained that it had opted for a negative form of words in Article 33 of its Draft.
`in order to show, by this formal means also, that the case of invocation of a state of necessity as a justification must be considered as really constituting an exception-and one even more rarely admissible than is the case with the other circumstances precluding wrongfulness..."(ibid.; p.5l? para. 40)
Thus, according to the Commission, the state of necessity can only be invoked under certain strictly, defined conditions which must be cumulatively satisfied; and the State concerned is not the sole Judge of whether those conditions have been met."
"52. In the present case, the following basic conditions set forth in draft Article 33 are relevant: It must have been occasioned' by an "essential interest" of the State which is the author of the act conflicting with one of its international obligations; that interest must have been threatened by a "grave and imminent peril"; the act being challenged must have been the "only means" of safeguarding that interest; that act must not have "seriously impaired an essential interest" of the State towards which the obligation existed; and the State which is author of that act must not have "contributed to the occurrence of the State of necessity". Those conditions reflect customary international law:"
54.?????? The verification of the existence, 1989, of the peril' invoked by Hungary, of itsgrave and imminent' nature, as well as of the absence of any `means' to respond to it, other than the measures taken by
Hungary to suspend and abandon the works, are all complex processes."
"Necessity.---The word "necessity" does not have a fixed character. It is relative and elastic, rather than absolute, and it is without any distinct or definite signification.
"It has varying degrees of meaning which the Courts recognized, and may connote different degrees on necessity. Thus, it may mean a necessity which is unavoidable, and it may mean a necessity which is merely a matter of convenience, the word being frequently used in connection with other words which increase or diminish. the urgency implied: It should be construed with reference to existing conditions.
"The word "necessity" is not always used in its lexicographical sense of indispensably or essentially requisite, or as meaning an absolute or indispensable need or the imaginary need of whimsy, caprice, or mere convenience. Sometimes it does mean .indispensable, but not always, and it may not mean that which is ,indispensable or requisite, for it is not restricted in law to that which is absolutely essential to existence."
"It does not mean an absolute, unavoidable, physical necessity; but it may mean a practical, or reasonable, or an economic and moral, necessity, and it may be used as meaning appropriate or fitting to the particular instance; a substantial or obvious need in view of the disclosed relevant circumstances."
"While the term "necessity" is elastic, as stated ante, -the elasticity should not be extended to cover that which is merely, desirable arid I not reasonably essential.. A necessity is a requirement, and necessity is something quite different from mere. convenience. A thing which is expedient is a necessity, and a strong or urgent reason why a thing should be done creates a necessity for doing it. Necessity usually imports negation of freedom."
`The term is variously defined as meaning the quality or state of being necessity; needful; conducive; requisite; indispensably requisite; urgent need, unavoidable; a state or condition imperatively demanding relief or assistance; inevitableness; indispensableness; inevitable consequence; irresistible force.
"In its primary sense it signifies that which is unavoidable; inevitable, or indispensable; that which makes an act or event unavoidable; offering no other course; that which is needed; that which is essentially requisite; something that is necessary; something which must be accomplished to attain a desired result; the occasion, or that which gives rise to something else.
"With reference to public-matters and legislative usage in general, necessity means great or urgent public convenience."
"Necessity" has been held to be synonymous with, or equivalent to, "emergency" see, the C.J.S. definition Emergency, and "requirement." , "The power of condemnation may in some instances be exercised only where it is established that there is a necessity for the taking of the particular property, and in this connection the meaning of the word "necessity" has frequently been adjudicated..."
"Public necessity.---A relative term meaning urgent public convenience; in-this connection inconvenience tray be so great as to amount to necessity."
"The Convention of Lords and
Commons' met in January, 1689, and next month offered the Crown to William and
Mary jointly, subject to conditions set out in a Declaration of Right. The offer having been accepted,- the Convention passed an Act asserting that it Was
Parliament, and then enacted the Bill of Rights, incorporating the Declaration of Right. Clearly, the Convention,Parliament' had been irregularly summoned; its affirmation of its own legal authority carried the matter no farther; there had been no King from December, 1688 (assuming that James II was deemed to have abdicated or to have forfeited the Crown) till February,. 1689; William III had no hereditary legal title to the throne and, therefore, had no authority to assent to Bills. Has every purported Act .of Parliament since 1688 been a nullity?
Is a .Stuart still the rightful King?
Once questions such as these are asked, one must acknowledge that in certain circumstances a breach of legal continuity, be it peaceful or accompanied by coercion and violence, may have to be treated as superseding the constitutional and legal order and replacing it by a new one. Legal theorists have no option but to accommodate their concepts to the facts of political life. Successful revolution sooner or, later begets its own legality. If, as Hans Kelsen has postulated, the basic norm or ultimate principle underlying a constitutional order 'is that the constitution ought to be obeyed, then the disappearance of that order, followed by acquiescence on the part of officials, judges and the general public in law, rules and orders issued by the new holders of power, will displace the old basic norm or ultimate principle and give rise to a new one. Thus, might becomes right in the eye of the law."
"The argument can be summarized in this way: sooner or later a breach of legal continuity will be treated as laying down legitimate foundations for a new constitutional order, provided that the revolution' is successful; there is, however, no neat rule of thumb available to' judges during or immediately after therevolution' for the purpose of determining whether the old order survives wholly, in part or not at all. It so happened that the Revolution of 1688 gave a clear pointer to the Judiciary. There was a suspension of business in the Courts, and after the throne had become vacant new judges had to be appointed because of a `demise of the Crown'. These appointees were not at all likely to call the validity of the regime in question. After a while (at the latest, after the failure of the
Jacobite revolt in 1715] it would have been merely silly for a judge or commentator to deny that the Bill of Rights, 1689 and other legislation passed after the Revolution were valid.. Efficacy and acquiescence had established a new basis for legality. The particular circumstances in which the Revolution of 1688 took place, and its immediate practical consequences, laid a secure foundation, moreover, for judicial acceptance of the doctrine of absolute parliamentary sovereignty. The doctrine grew out of a particular state of affairs. A fundamental change of .a political nature may bring about a fundamental change in legal doctrine. "
Under the sub-heading `The Concept of Necessity', in the same book, it was observed:-
"One other comment must be made. In some situations where unconstitutional action has been taken by persons wielding effective political power, it-is open to 'a judge to steer a middle course. He may find it possible task that the framework of the pre-existing order survives but the deviation from these norms can be justified on the grounds of necessity. The principle of necessity, rendering lawful what would otherwise-be unlawful is not unknown to English Law; there is a defence of necessity, (albeit of uncertain scope), in criminal law and in Constitutional law, the application of martial law is but an extended application of this concept. But the necessity -must be proportionate to the evil to be averted, and acceptance of the principle does not normally imply total abdication from judicial review or acquiescence in the suppression of the Legal order; it is essentially a transient phenomenon. State necessity has been judicially accepted as a legal justification for ostensibly unconstitutional, action to fill a vacuum arising within the constitutional order in Pakistan????.."
"Anxious consideration must of course be given to deciding whether events constitute a coup d'etat or merely a `constitutional deviation'. It is in this context that the following observations of Haq, C J in Bhutto PLD 1977 SC 657 at 721-722 (relied upon in appellant's heads of argument) are appropriate:
`That in any case the theory of revolutionary legality can have no application or relevance to a situation where the breach of legal continuity is of a purely temporary nature and for a specified limited purpose. Such a phenomenon can more appropriately be described as one of constitutional deviation rather, than of revolution.'
"I have earlier adverted to aspects of the appellant's argument that what occurred in the present case was merely such a `constitutional deviation'. It was further argued that the High Court erred in concluding that the events in the present case constituted a coup d'etat because this was not a case of competing governments, nor one dealing with the status of a new regime, nor an issue of whether the government was lawful. The issue rather was whether what was done by the first respondent was within his powers or not.
I am unable to agree. The absence of competing governments by no means indicates that a coup d'etat has not taken place. If other conditions are satisfied (including for example) the requirement that the old legal order is replaced by a new legal order in a way not provided for or contemplated in the old order) then it is irrelevant that there are not (or have not been) competing governments. It is quite possible for a person or group of persons who were in power and constituted the Government to effect a revolution if it replaces one legal order by another in a manner not provided for by the old order. It is the fundamental unlawfulness of the change and substantial nature of the change which is relevant, not the precise mechanisms bringing it about. In fact the absence of `competing' governments may be an indication that the revolution has been successful..."
"In the result, and bearing in mind the necessity for considering the `total milieu in which the change is brought about', one cannot escape the conclusion that at some point a new order, brought about by revolution and in particular is capable of achieving legitimacy and I would, subject to the same qualification accept the test as formulated by the Chief Justice in Mokotso (1989) LRC (Const.) 24 at 133 (and by implication applied by him in the present case), namely:
"A Court may hold a revolutionary Government to be lawful, and its legislation to have been legitimated ab initio, where it is satisfied that (a) the Government is firmly established, there being no other government in opposition thereto; and (b) the government's administration is effective, in that the majority of the people. are behaving, by and large, in conformity therewith.
"On this part of the case I am well-satisfied that the events of 20 February 1990 and thereafter, did in fact constitute a coup d'etat and not merely a constitutional deviation from the previous dispensation. Unless there are good reasons for not doing so it is my considered view that the learned Chief Justice cannot be faulted for holding that `the present Government is the lawful Government of the Kingdom of Lesotho and that its legislation has been legitimated ab initio, that is, with effect from 19th February, 1990; particularly in the light of his unchallenged findings regarding the high degree to which the new Government is established, effective and finds popular support amongst the people as a whole."
"There is ample authority for the submission on the appellant's behalf that the constitutional role of the courts of law, even in times of crises, is to administer justice 'to those who seek it, to serve as a buttress between the executive and the subject, to protect the citizen when the legislature exceeds its Constitutional powers and to do so without fear, favour or prejudice, and independently of the' consequences which ensue.
"I would suggest that this is the construction to be placed on those judgments criticising `effectiveness' as the sole criterion for the .. legality of the revolutionary Government.
"In Bhutto's case for example, Anwarul Haq, CJ observed: .
`by making effectiveness of the political as the sole condition of criterion of its legality it excludes from consideration sociological factors of morality and justice which contribute to the acceptance or if effectiveness of the new legal order.'."
"The Attorney-General, on the other hand, blamed the insurgents, and the conditions created by their prolonged activity; and submitted upon a well-supported argument, that the new Law was enacted on sound legal foundation; the generally accepted principle of the law. of necessity for the preservation of fundamental services in the State. The preservation of the administration of Justice itself, in this case."
"The existence, the validity, and the force of the Constitution, are not in question. That the new law has not been promulgated, or published according to the written text of the relative part of the Constitution, has not been contested. That it is not in accordance with certain constitutional provisions, especially Articles 133.1 and 153.1; in material particulars, there can be no doubt. And the fact that the Attorney-General of the Republic defends this new Law, by the defence of necessity, points, I think, in the direction that its validity cannot otherwise be defended. The reasonable inference is that had it not been for "the necessity" which caused its enactment, the new Law, probably, would not have been enacted; and if enacted, it might well be challenged as unconstitutional. This is the position in which I see the question for consideration in the light of the submissions before us. And it seems to me that the onus of establishing this "defence of necessity", lies upon the side which invokes it. "
"Opening his article on the subject, in the sixth volume of the publications of the Faculty of Laws, of the University College, London, Current Legal Problems, (1953), at page 216-(referred to by the learned Attorney-General)-Professor Glanville Williams says: .
"The defence of necessity is not so much a current as a perennial legal problem" "When I started to prepare this lecture-he writes at p.217 I thought of necessity as .a definite kind of defence, occupying its own niche in the law. But the authorities led me, into unexpected paths."
"The learned Attorney-General, in his able and most helpful address, referred us to reports of superior judicial authorities, and to writings of eminent jurists showing how this doctrine of necessity has long been accepted and applied in France, Germany, Italy, Greece, and how it is also found in that treasure of practical legal wisdom, the Mejelle, (Articles 17, 18, 21 and 22) which the elder of us, still remember with profound respect. I would have to go into great lengths in this judgment, if I were to cite the guidance and assistance which I found in all those sources of legal knowledge, in considering the problem in hand."
"It has been argued by counsel for respondents that the Court cannot take official cognizance of the existing emergency because the Council of Ministers has not issued a Proclamation of Emergency under Article 183 of the Constitution. In my opinion, the Court cannot close its eyes to notorious relevant facts in deciding these cases. Article 183 is a provision enabling an emergency to be declared for certain limited purposes and through a specified procedure. The fact that in spite of what has been going on in Cyprus since December, '1963, no proclamation of Emergency has been issued under Article 183, ' rather than indicating, contrary to glaring fact, that no such emergency exists, strongly indicates that the present emergency is one which could not be met within the express provisions of the Constitution. At a time when by a resolution, dated 4th March, 1964, of the Security Council of the United Nations an International Force has been dispatched to Cyprus to assist in the return to normality and a U.N. Mediator has been assigned to try and work out a solution of the Cyprus Problem, it would be an. abdication of responsibility on the part of this court to close its eyes to the realities of the situation, because, for any reason, no Proclamation of Emergency has been made under Article 183, and to hold that everything is normal in Cyprus. To pretend that the administration of justice could have functioned unhindered as envisaged under the Constitution, because a measure that could have been taken under a provision of limited application, such as Article 183, has not in fact been taken, would be unreasonable. I pass no censure on counsel for respondents who has raised the point; he has done so in the discharge of his duties to his clients, as, on its own part, the Court has also to discharge its duty to all persons in Cyprus for the sake of all of them."
"Granted that an emergency, as already described, exists the next thing to be examined is its relation to the basic theme of the constitutional structure.
"It cannot, of course, be argued that, because of such an emergency, constitutional deadlock or other internal difficulties, it is possible to question the existence of Cyprus as an independent State. The existence of a State cannot be deemed to be dependant on the fate or operation of its Constitution; otherwise, every time that any Constitution were upset in a country then such State would have ceased to exist, and this is not so. The existence of a State is a matter governed by accepted criteria of international law and in particular it is related to the application of the principle of recognition by other States."
"Organs of Government set up under a Constitution are vested expressly with the competence granted to them by such Constitution, but they have always an implied duty to govern too. It would be absurd to accept that if, for one reason or other, an emergency arises, Which cannot be met within the express letter of the Constitution, then such organs need not take the necessary measures in the matter, and that they would be entitled to abdicate their responsibilities and watch helplessly the disintegration of the country or an essential function of the State, such as the administration of justice??????.As it has been accepted by the Council of State in Greece, in time of emergency it ' is the, responsibility of the Government to ensure the proper functioning of public services and of generally the machinery of the State (Decision 566/1936)"
"Having considered the jurisprudence and authoritative writings of other countries to which this Court has been referred, as well as some others, I am of the opinion that the doctrine of necessity in public law is in reality the acceptance of necessity as a source of authority for acting in a manner not regulated by-law but required, in prevailing circumstances, by supreme public interest, for the salvation of the State and its people."
(ii) that a Court in interpreting and applying a Constitution has to adopt, as much as possible, an experiential approach."
"I am. of the opinion that Article 179 is to be applied subject to the proposition .that where it is not possible for a basic function of the State to be discharged properly, as provided for in the Constitution, or where a situation has arisen which cannot be adequately met under the provisions of the Constitution then the appropriate organ may take such steps within the nature of its competence as are required to meet the necessity."
"Even though the Constitution is deemed to be a supreme law limiting the sovereignty of the legislature, nevertheless, where the Constitution itself cannot measure up to a situation which has arisen, especially where such situation is contrary to its fundamental theme, or where an organ set up under the Constitution cannot function and where, furthermore, in view of the nature of the Constitution it is not possible for the sovereign will of the people to manifest itself, through an amendment of the Constitution, in redressing the position, then, in my opinion according to the doctrine of necessity the legislative power, under Article 61, remains unhindered by Article 179, and not only it can, but it must, be exercised for the benefit of the people."
"Then it cannot be said to be a case of legislation repugnant to, or inconsistent with, the provisions of the supreme law, in contravention of Article 179, because it is legislation to meet a situation to which the supreme law itself is not, in view of its nature and provisions, applicable, and it cannot be made applicable to meet it; there can, thus, be no question of the legislature exercising sovereignty in a field where the sovereignty of fundamental law is already established, by means of the Constitution. And with the Cyprus Constitution, in view of its origins and nature, it is all the more proper and necessary for the legislature to exercise its own powers, on behalf of the people, in matters of necessity."
"I am of the opinion that because of the "recent events" mentioned in the preamble to Law 33/64, and described already in an earlier part of this Judgment, a public necessity of the first magnitude had arisen for the judiciary to be enabled to function urgently, properly and adequately."
"That the proper discharge of the administration of justice constitutes a necessity, especially in times of upheaval, such as the present,, cannot be reasonably disputed. It has been so aptly put in Decision 1601 of 1945 of the Greek Council of State where it was held that the situation under consideration (" ....constituted an obvious, imperative and unavoidable necessity, making it necessary that, in priority to all else, order had to be restored from both the moral and service aspects in the functioning of judicial services, which contribute fundamentally to the restoration of order and security and to the strengthening of the confidence of the citizens in the rule of law, and, therefore, the creation of the indispensable conditions for a return of the country to normal political life through. free elections .... ") And this proposition was re-affirmed in Decision. 624 of 1945 of the Greek Council of State, in identical terms. "
"Law of Necessity. ---I shall now deal with the "law of necessity" as understood and applied in other countries. The classical writers abound in maxims upholding the concept of necessity. This is mainly based on the maxim "salus populi est supremo lex ". Judicial decisions in various countries have acknowledged that in abnormal conditions exceptional circumstances impose on those exercising the power of the State the duty to take exceptional measures for the salvation of the country on the strength of the above-maxim."
"In -Italy the law of necessity has been accepted long ago as forming part of the law of the country. Eminent writers on Public Law adopt the principle that necessity constitutes an original source of law independently of the case where it is a prerequisite for the application of certain constitutional provisions for a state of emergency: See e.g. C. Mortati, Professor in the University of Rome: "Diritto Pubblico" 1(1962), 6th edition, page 174; and R. Alessi, Professor of Administrative Law in the University of Bologna: "Diritto Amministrativo Italiano" (1960), 3rd edition, page 218."
"This is what Professor Mortati has to say on this point (ubi supra, at page 174)":
"While necessity, in a third meaning, which is that considered here, presents itself as a fact of autonomous juridical product, when it operates outside or even contrary to law, appearing by itself capable of legalising the act, otherwise illegal. Naturally for the production of that effect, necessity must have an institutional character, that is to say it must be deduced from the exigencies of life, from the purpose the political institution of the state is aiming at,. that is to. say of the juridical order to which appertains the organ operating on the basis of such source ("fonte")
"In Germany the law of necessity has been accepted by famous writers on Public law like Laband and W.Jellines and was embodied in Article 48 of the Weimar Constitution (see Jellinck, "Gesetz and Verordung", 1887, page 376."
"In the light of the principles of the law of necessity as applied in other countries and having regard to, the provisions of the constitution of the Republic of Cyprus (including the provisions of Articles 179, 182 and 183), 1 interpret our Constitution to include the doctrine of necessity in exceptional circumstances, which is an implied exception to particular provisions of the Constitution; and this in order to ensure the very existence of the State. The following prerequisites must be satisfied before the doctrine may become applicable:
(a) an imperative and inevitable necessity or exceptional circumstances;
(b) no other remedy to apply;
(c) the measure taken must be proportionate to the necessity; and
(d)??????? it must be of a temporary character limited to the duration of the exceptional circumstances. ?????
"A law, thus, enacted is subject to the control of this Court to decide whether the aforesaid prerequisites are satisfied, i.e. whether there exists such a necessity and whether the measures taken were necessary to meet it."
"The Chief Justice, Muhammad Munir, opened his judgment with a discussion of the theoretical assumptions to be adopted in the case:
"As we will have to interpret some of the provisions of this Order, it is necessary to appraise the existing constitutional position in the light of the juristic principles which, determine the validity or otherwise of law creating organs in modern States which being members of the comity of nations are governed by international Law. In judging the validity of laws at a given time, one of the basic doctrines of legal positivism, on which the whole science of modern jurisprudence rests, requires a jurist to presuppose the validity of historically the first Constitution whether it was given by an internal usurper, an external invader or a national hero or by a popular or other assembly of persons. Subsequent alterations in the Constitution and the validity of all laws made thereunder is determined by the first Constitution. Where a Constitution presents such continuity, a law once made continues in force until it is repealed, altered or amended in accordance with the Constitution. It sometimes happens, however, that a Constitution and the national legal order under it is disrupted by an abrupt political change not within the contemplation of the Constitution. Any such change is called a revolution, and its legal effect is not only the destruction of the existing Constitution but also the validity of the national legal order. A revolution is generally associated with public tumult, mutiny, violence and bloodshed but from a juristic point of view the method by which and the persons by whom a revolution is brought about is wholly immaterial. The change may be attended by violence or it may be perfectly peaceful. It may take the form of a coup d'etat by a political adventurer or it may be effected by persons already in public positions. Equally irrelevant in law is the motive for a revolution, inasmuch as a destruction of the constitutional structure may be prompted by a highly patriotic impulse or by the most sordid of ends. For the purposes of the doctrine here explained a change is, in law, a revolution if it annuls the Constitution and the annulment is effective. If the attempt to break the Constitution fails those who sponsor or organize it are judged by the existing Constitution as guilty of the crime of treason. But if the revolution is victorious in the sense that the persons assuming power under the change can successfully require the inhabitants of the country to conform to the new regime, then the revolution itself becomes a law-creating fact because thereafter its own legality is judged not by reference to the annulled Constitution but by reference to its own success. On the same principle the validity of the laws to be made thereafter is judged by reference to the new and not the annulled Constitution. Thus, the essential condition to determine whether a Constitution has been annulled is the efficacy of the change. In the circumstances supposed no new State is brought into existence though Aristotle thought otherwise. If the territory and the people remain substantially the same, there is, under the modern juristic doctrine, no change in the corpus- or international entity of the State and the revolutionary Government and the new Constitution are according to International Law, the legitimate Government and the valid constitution of the State. Thus, a victorious revolution or a successful coup d'etat is an internationally recognized legal method of changing a Constitution. " (Italics added)"
"His Lordship then proceeded to cite with obvious approval from Salmond on Jurisprudence (11th ed. by Glanville Williams), at p.101 a passage which reads thus:
"Every constitution has an extra legal origin, the best illustration being the United States of America which in open and forcible defiance of English Law broke away from England and set up new states and a Constitution the origin of which was hot merely extra legal but was illegal."
"Yet, so soon as those constitutions succeeded in obtaining de facto establishment in the rebellious colonies they received recognition as legally valid from the Courts of the colonies. Constitutional law followed hard upon the heels of constitutional facts."
"Then His Lordship went on to say ([1968] 3 All ER 561 at p.574):
"It is a historical fact that in many countries - and. indeed in many countries which are or have been under British sovereignty there are now regimes which are universally recognized as lawful but which derive their origins from revolutions or coups d'etat. The law must take account of that fact. ' So, there may be a question how or at what stage the new regime became lawful."
"Assuming for the moment that is so, we have reached the position where The State v Dosso has received support from the highest judicial pinnacle. And 'so we cannot just brush it aside because the same Court decided differently thirteen years later. But I doubt that this is so. I am inclined to .the view that His Lordship was there and then just noting the tests of revolutionary legality applied in these two cases by the Courts."
"S.K. Date-Bah in an article "Jurisprudence's Day in Court in Ghana" (1971) 20 ICLQ 315 suggested that the Court of Appeal should not have dismissed - Kelsen so casually without a more serious and analytical consideration of his work. This was perhaps the first reported positive Commonwealth judicial rejection. of a basic Kelsenite principle outside of Pakistan. And I agree with. their conclusion and its ratio decidendi. Doubts had been raised in a few cases in Pakistan itself by both Bench and Bar about the correctness of the actual decision in The State v Dosso, Jilani v The Government of the Punjab involved full judicial scrutiny of alleged fallacies inherent in the application of Kelsen's theory of revolution and legal discontinuity which had become somewhat popular in Commonwealth Courts since The State v Dosso. A full bench of 5 judges decided on 20th April, 1972 that Dosso was wrong and it was overruled. Dosso's case was to be rejected, not only because the Supreme Court there had been wholly premature in finding that President ' Iskander Mirza had effectively abrogated the 1956 Constitution, but also because Kelsen's doctrine of the law? annulling effect of revolutions and coups d'etat is not a rule or principle of law to be applied by Courts and Judges, but merely a theory about law and a controverted one at that PLD 1972 SC, 139.
"The Chief Justice referred extensively to Kelsen in an endeavour to show that the jurist had been misunderstood in Dosso. He said (pp.179,180):
"Kelsen... continues to be grievously misunderstood. He was only trying to lay down a pure theory of law as a rule of normative science consisting of an aggregate or system of norms.'
He was propounding a theory of law as amere jurist's proposition about law.'
He was not attempting to lay down any legal norm or norms which are the daily concern of Judges, legal practitioners and administrator. His purpose was to recognize that such things as revolutions do also happen but even when they are successful they do not acquire any authority to (revoke) or annul the previous
`general norm' until they have themselves become a legal order by habitual obedience by the citizens of the country. It is not the success of the revolution, therefore, that gives it legal validity but the effectiveness it acquires by habitual submission to it from the citizens. " (Italics added)
And Yaqoob Ali, J., stressed (at p.220) that:
"It must be remembered in this connection that, however, effective the Government or usurper may be, it does not within the national legal order lacquer legitimacy unless the Courts recognize the Government as de jure. "
"Unless and until this takes place, the status of the Government remains undetermined. The criticisms of Kelsen are too lengthy to discuss. It must suffice to state that, mostly, I agree with them. And I too think The State v Dosso was wrongly decided."
"In Bhutto v The Chief of Staff, Pakistan Army and the Federation of Pakistan PLD 1977 SC 670 Dosso's case came up again. On 17th March 1977 general elections were held ' in Pakistan. The Pakistan People's Party, led by Prime Minister Zulfikar Ali Bhutto, was credited with 155 of the 200 elected seats in the National Assembly. The extent o: the victory was much more than was generally expected. The Opposition immediately denounced the elections as "rigged". Protest demonstrations and strikes gradually built up to widespread rioting in which the deaths of over 300 people were reported."
"So, the Supreme Court, on this point, expressed the view that the validity or legality of a new revolutionary regime cannot be judged by the sole criterion of its success or effectiveness, as contemplated by Kelsen's pure theory of law "because by making effectiveness of the political change the sole condition or criterion of its legality, it excludes from consideration sociological factors of morality and justice which contribute to the acceptance or effectiveness of the new legal order," Their Honours concluded that "The legal consequences of such a change must, therefore, be determined by a consideration of the total milieu in which the change is brought about, including the motivation of those responsible for the change and the extent to which the old legal order is sought to be preserved or suppressed." ??????
"I read this to mean that, in such cases, the Court called upon to decide the question should take into consideration both the reason why the old constitutional Government was overthrown and the nature and character of the new legal order. Was the motivation mere power grabbing or was it a rebellion or example against oppression or corruption or ineptitude? And is the new legal order a just one? It does not appear that this case was cited in Controller of Taxes v. Valabhaji, Civil Appeal No. 111 of 1981 was judgment of the Court of Appeal of the Seychelles, delivered on 11th August 1981. The appeal was against the dismissal of an application to set aside a judgment for the payment of arrears of income tax."
"Hogan P., in a careful judgment, considered helpfully the question Lord Reid referred to in Madzimbamuto v Lardner-Burke, how or at what stage a (revolutionary) unconstitutional regime becomes lawful? Be it noted, I digress to remark, that the question was and is not "if" this can happen, but "how" and "when" does it happen?"
"The learned President considered a passage in a citation from Professor S.A. de Smith's Constitutional and Administrative Law, 3rd edn., where, at p.66 the author having said "to assert that all Constitutions or Constitutional amendments procured in a manner inconsistent with, pre-existing legal order are legally invalid will land one in a morass of absurd and insoluble difficulties," continued"-
"...One must acknowledge that in certain circumstances a breach of legal continuity, be it peaceful or accompanied by a coercion and violence, may have to be treated as superseding the constitutional and- legal order and replacing it by a new one. Legal theorists have no option but to accommodate their concepts to the facts of political life. Successful revolution sooner or later begets its own legality..."
"and to Artistides M. Liasi v The Attorney-General (1975) 3 Cyprus LIZ 568 where Loizou, J., had carried his researches back to the Roman Lex Barbarius Philippus, said, when dealing with the aftermath of the short-lived elevation of Nicolaos Sampson (p.573):-
"According to the case law and legal theories, two are the basic tests whereby a coup d'etat is legalized. .The first, the substantial test, is popular acceptance, even if a tacit one, of the change and legal, values thereby invoked, and the second, the formal test, is the legalization of the `coup d'etat Government' through the recognition of its actions by the next lawful Government." (Italics added)
And then His Lordship went on to deal with the aspect of the timing of such legitimacy or validity. The Court asked: "But what about the interval if any, before it is firmly established and is merely en route to that position", and in answer said: ??????????
"Roscoe Pound in his work on Jurisprudence (Vol.1I, Pt.3, p.30) refers to the important decision of the United States Supreme Court in Williams v Bruffy 96 US 176, 186-191 for the proposition:-
`in the case of an ultimately successful insurrection the Courts deriving from it would uphold acts of insurgents from the beginning and courts of other countries would do the same.'"
a conclusion which appeared to be amply justified by, inter alia, the passage in the judgment where the Court, having referred to a rebellion in part of a State, continued:-
"The validity of its acts, both against the parent State and its citizens or subjects, depends entirely on its ultimate success ...such was the case of the State Governments under the old confederation on their separation from the British Crown. Having made good their declaration of independence everything they did from that date was as valid as if their independence had been at once acknowledged. "
"May be so, but study of these cases from 1958 to 1981 mentioned above can and should be able to guide Caribbean judges in the formation of principles of revolutionary legality judicially sound and at the same time consistent with our political democratic ideology. And we must bear in mind what Triantaphyllides, J., said in Attorney-General of the Republic v. Ibrahim (1964) Cyprus LR 195, 231, that "the mission of the supreme judicial organ in any State is to lay down authoritatively its own law and not (automatically) to apply the law of any other state, though past precedents anywhere are always of great help."
"The respondents do not deny its 'unconstitutionality vis-a-vis the Constitution of 1973. But, they contended, when the new High Court was constituted; it had validity on the legal foundation of the law of necessity, and much reliance was placed on Attorney-?General of the Republic of Cyprus v Ibrahim (1964) Cyprus LR 195."
"Salmond on Jurisprudence, 12th eel. (1966) para. 94 reads:- "We shall conclude our examination of the theory of wilful wrongdoing by considering a special case in which motive operates as a ground of excuse. This is the case of the jus necessitatus. So far as the abstract theory of responsibility is concerned, and act- which is necessary is not wrongful, even though done with full and deliberate intention." It is a familiar proverb that necessity knows no law -Necessitatus no habet legem is obviously too wide a proposition to be acceptable today. And S.A. de Smith's Constitutional and Administrative Law, 4th ed. (1973), pp. 78-9 has this statement:--
"The principle of necessity, rendering lawful what would otherwise be unlawful, is not unknown to English law; there is a defence of necessity (albeit of uncertain scope) in criminal law, and in Constitutional law the application of martial law is but an extended application of this concept. But the necessity must be proportionate to the evil to. be averted, arid acceptance of the. principle does not normally imply total abdication from judicial review or acquiescence in the supersession of the legal order; it is essentially a transient phenomenon. State necessity has been judicially accepted in recent years as a legal justification for ostensibly unconstitutional action to fill a vacuum arising within the constitutional order in Pakistan, Cyprus, Rhodesia and Nigeria. To this extent it has been recognised as an implied exception to the letter of the Constitution. And perhaps -it can be stretched far enough to bridge the gap between the old legal order and its successor."
"Then there was the summation of Lord Mansfield in R v. Stratton and others (1779) 21 St Tr 1046, an information for a misdemeanour in arresting, imprisoning. and deposing Lord Pigot, Commander-in-Chief of the Forces in Fort St. George and President and Governor of the Settlement of Madras in the East Indies. The defence was that Lord Pigot had violated the Constitution of the Government of 'Madras with regard to the Governor and council in whom the whole power was vested by the East India Company and that the defendants had acted under necessity in order to preserve the Constitution.
"I turn to the "law of necessity" as understood and applied in other countries. Judicial decisions in several European countries have acknowledged that in abnormal conditions exceptional circumstances impose on those exercising the powers of the State the duty to take exceptional measures for the salvation of the country on the strength of the maxim salus populi suprema lex.
"In my view all this learning justifies this Court in adopting and adapting the law or ,doctrine of necessity for use in public law as a principle of revolutionary legality in fit cases. It was so used by the Federal Court of Pakistan in Reference by H E The Governor General No. l of 1955 PLD 1955 FC 435: by the Supreme Court of Pakistan in Jilani v. The Government of the Punjab (Supra) and in Bhutto v The Chief of Staff, Pakistan Army and Federatiori of Pakistan (supra); by the General and- Appellate Divisions of the High Court of Rhodesia and by Lord Pearce (in dissent) in the Privy Council; and very recently by the Constitutional Court of Malta in Archbishop Joseph v The Prime Minister, 22nd October 1984.
"On this basis the Court applied the law of necessity to found their conclusions that: , "this was not a case where the old legal order had been completely suppressed or destroyed, but merely a case of a constitutional deviation for a temporary period and for a specified and limited objective namely, the restoration of law and order and normalcy in the country, and the earliest possible holding of free and fair elections for the purpose of .restoration of democratic institutions under the 1973 Constitution";
"It was a situation for which the Constitution provided no solution and the Armed Forces had, therefore, to intervene to save the country from further chaos and bloodshed, to safeguard its integrity and sovereignty, and to separate the warring factions which had brought the country to the brink of disaster"; and that, in the circumstances, "the imposition of Martial Law, therefore, stood validated on the doctrine of necessity, and the Chief Martial Law Administrator was entitled to perform all such acts and promulgated all legislative measures which have been consistently recognised by judicial, authorities as falling within the scope of the law of necessity.
"The Attorney-General of the Republic of Cyprus v Ibrahim-et al must be dealt with in more detail. It is the nearest case to this one. The Cyprus Constitution of 1960 gave to the 18 per cent Turkish community the right to participate in all important matters of State, executive, legislative and judicial.
"In this judgment Triantafyllides, J., held that "the legal doctrine of necessity . . . should be read into the provisions of the written Constitution . . . and must be deemed to be part of the scheme of the constitutional order in Cyprus so as to enable the interests of the country to be met where the Constitution . . . does not contain adequate express provision for the purpose."
"I am of the opinion that the doctrine of necessity in public law is in reality the acceptance of necessity as a source of authority for acting in a manner not regulated by law but required, in prevailing circumstances, by supreme public interest,, for the salvation of the State' land its people. In such cases salus populi becomes suprema lex. That being so, the doctrine of necessity has developed in accordance with, the situations which have given rise to its being propounded or resorted to"; and later:
"I interpret our Constitution to include the doctrine of necessity in exceptional circumstances, which is an implied exception to particular provisions of the Constitution; and this in order to ensure the very existence of the State."
"Archbishop Joseph v The Prime Minister (Commonwealth Law Bulletin, Vol. l1, No. 1, January 1985 p.44) is a case from Malta.
"These instances cannot be taken to comprise an exhaustive list of the extra constitutional situations to which the doctrine may be applied. If so, then a fortiori it should be capable of application to validate unconstitutional legislation by a constitutional representative Government in Parliament if the requisite conditions are satisfied."
(3)??????? "I would lay down the requisite conditions to be that:
(i)???????? an imperative necessity must arise because of the existence of exceptional circumstances not provided for in the Constitution, -for immediate action to be taken to protect or preserve some vital function to the State;
(ii)??????? there must be no other course of action reasonable available;
(iii)?????? any such action must be reasonable necessary in the interest of peace, order, and good Government; but it must not do more than is necessary or legislate beyond that;
(iv)?????? it must not impair the just rights of citizens under the Constitution, (v)??????? It must not one the sole effect and intention of which is to consolidate or strengthen the revolution as such.
(4)??????? It is for this Court to pronounce on the validity (if so) of any unconstitutional action on the basis of necessity, after determining as question of fact, whether or not the above conditions exist. But it is for the party requiring. the Court to do so to ensure that proof of this is on the record.
(5)??????? Such validation will not be a once-for-all validation, so to speak, it will be a temporary cue, being effective only during the existence of the necessity. If and when this ends, the right constitutional steps must be taken forthwith, that is, within a reasonable time."
"The Chief Justice justified the validation on the basis that it was not the act of the revolutionary Government that caused it. But even if it was, the stark situation was not unlike that in Rhodesia (if not less undeserving), in relation to which Lord Pearce held that "the principle of necessity or implied mandate applied to the present circumstances in Rhodesia."
"It is my intention to do so . .
In arriving at a decision I am conscious of the exhortation of Vassiliades, J., in The Attorney-General of the Republic v Ibrahim (1964) Cyprus LR 195 in which he states that a Court, in arriving a decision in those circumstances, must not only apply the law in well-balanced form and in accordance with the conditions prevailing at the time but must also be conscious of its important and, responsible function of transforming legal theory. into living law as applied to the facts of daily life."
"In my view when a Government in power has effective control with the support of a majority of the people and is able to govern efficiently, that Government should be recognised as legal. This approach seems to be recognised in S.A. de Smith's Constitutional and Administrative Law (3rd ed.), p.66, where he states:-
"Legal theorists have no option but to accommodate their concepts to the facts of political life. Sooner or later a breach of legal continuity will be treated as laying down legitimate foundations for a new constitutional order, provided that the revolution is successful. "
"And J. Bryce in his book Studies in History and Jurisprudence (1901),Vol.2, p.64 states that:-
"Sovereignty de facto, when it has lasted for a certain time and shown itself stable, ripens into sovereignty de jure".
"I am of the view that sovereignty, or revolutionary legality, or de jure status, by whatever name it is called, ultimately depends on consent or acceptance by the people in the particular country under consideration .which is manifested by the obedience to the precepts of those claiming to exercise authority over them. Once this is firmly established, it is trite law that in the case of a successful revolution. The validity of the new Government's laws date back to the day when the revolution first broke out."
constitutional as well as extra-constitutional means. It is also correct that emergencies are promulgated all over the world, especially in Asia, Africa and Latin America but their efforts have been to minimize them and to induce the authorities concerned to respect the Fundamental Rights. . In numerous books of distinguished jurists, the term "state of emergency" was interpreted widely to include "regimes of exception", i.e. regimes that had overthrown and not merely suspended the previous constitutional order and had assumed. legislative and executive powers analogous to those under a formal state of emergency.
Reference may be made to the book titled "States of Emergency" Their impact on Human Rights. A brief background which resulted into creation of this book is that the International Commission of Jurists undertook a study of states of emergency. Over 15 countries were selected which had experienced states of emergency in the 1960's and 1970's. The selection covers different kinds of emergency under different regimes and in different regions. It was found that States of emergency are encountered with surprising frequency throughout the world. The chapters on states of emergency in India, Malaysia and Thailand might have been followed by chapters on states of emergency in Bangladesh, Pakistan, Philippines, Singapore, South Korea, Sri Lanka and Taiwan. In Africa, states of emergency have been reported recently in Kenya, Liberia, Madagascar, Namibia, Sierra Leone, Somalia, Sudan, Zambia, Zimbabwe and parts of South Africa, in addition to Ghana and Zaire; in the Middle East in Egypt, Israel, Iran Jordan, Oman and North Yemen, as well as Syria. The frequent recourse to states of emergency in Latin America is well-known to the point where it is sometimes mistakenly thought of as a peculiarly Latin American problem. The chapter on Eastern Europe-makes a special contribution to the literature on this subject, being the first published summary of contemporary law and experience and historical roots of emergency powers in this region, which until recently had often been thought of as somehow exempt from this phenomenon. It would be advantageous to reproduce the following passages from the above book from pages 413-416, which read thus:
"States of exception are defined as extraordinary modes of governing provided for by the laws of the country and subject to such laws. for their declaration and implementation', while regimes of exception are defined asde facto situations of a purely political nature', that is, declarations of a state of exception accompanying
`interventions (in Government) which cannot be justified in terms of the constitution or previously established laws."
"On the other hand, a state of emergency need .not entail gross or excessive violations of human rights. The state of emergency is the counterpart in international law of self-defence in penal law. That it may be necessary to suspend respect for certain human rights in order to prevent the nation from falling into chaos is universally admitted. However, the very concept of necessity, when respected, prevents excessive infringements of rights, just as the codification, in accordance with the principle of necessity and proportionality, of a list of non-derogable rights serves to prevent gross violations of human rights. The problem; then, is to prevent abuse of states of emergency, and the formal declaration of ail emergency is a step in this direction."
"Several authors have also noted that, where the state of emergency was imposed during social unrest resulting from grave deterioration of the economic situation, the governments decision to treat the symptoms without treating the disease tends to perpetuate the crisis. "
"'In some cases, as in Thailand, excessive use of emergency powers may be explained in part by the persistence of ancient absolutist moral values and political habits. In others, as several authors have indicated, it is due to the emergence of a modern authoritarian political doctrine, the doctrine of national security. This doctrine, whose effects can be seen in the. chapters on Greece, Turkey and the four Latin American countries, can be summarised in the following terms:
" 1.?????? The. world is divided into two blocs, the East and West, whose values and interests are irreconcilably opposed. .
2.???????? The conflict between them- is not only military, but also `a struggle against the ideology, culture and traditions of the adversary' .
3.???????? The conflict occurs not only internationally but also intra-nationally.
4.???????? The duty of the military authorities to defend the nation, therefore, extends to the combat against any quasi-military, ideological, cultural or other manifestations of this enemy within the country, making whatever sacrifices in the rights of citizens or alterations in the structure of Government this may require.-
It would, therefore, be seen that recurrence of phenomena of imposition of emergencies in extreme situations whether through constitutional or extra-constitutional means, has not been in Pakistan alone but in several other countries all over the world, which has been validated by the Courts depending upon the peculiar circumstances in each case.
In the book titled "From Military to Civilian Rule" edited by Constantine P. Danopoulos, the writer has dealt with the history, of many countries including three European countries namely France, Greece and Spain. A large number of countries have been surveyed, with particular reference to the role of military in establishing and sustaining long-term military disengagement from politics; the role of forces lying outside national boundaries on military intervention; establishing and maintaining civilian control of the military. After such survey, the view expressed was that dictatorships (military or otherwise) may be strategically beneficial in the short term but run the risk of damaging the long-term interests of influential nations.
Refer Democracy, the Rule of Law and Islam, edited by Eugene Cotran and Adel Omar Sherif , wherein the author extensively dealt with Human Rights abuses and the protection of democracy during states of emergency; states. of emergency in civil and common law. jurisdictions; the current regime in International Human Rights law; the procedural principles of declaration and notification; the substantive principles of exceptional threat, proportionality, non-derogability, non-discrimination and compatibility; deficiencies in international monitoring and control; expanded standards and a new approach to the assessment of states of emergency and came to the conclusion that the framework of the type permits a huge range of variation in the assessment of the situation in individual states" or countries and, thus, of the legitimacy of the emergency powers which have been adopted. In assessing the legitimacy of state action under international human rights law, an understanding of the complexity of the interrelationship between facts on the ground and the relevant human rights norms may be snore valuable. So, too may an understanding of the relationship, the control and eventual elimination of human rights violations, finding a satisfactory political solution to the underlying problem and achieving a full restoration of democracy. The overall objective should be to link the assessment of the legitimacy of national emergency regimes under international human rights law with the kinds of international action for the prevention and resolution of internal conflicts which have been proposed within the United Nations by .Dr. Boutros Ghali and by others involved in the work of conflict resolution. It would be advantageous to reproduce the following passages at pages 113-1,14 of the above book, under sub-heading "States of Emergency in Civil and Common Law Jurisdiction" which read thus:
"A further important feature of national regimes in respect of ?emergency powers in both civil and common law is the absence of any effective internal legislative or judicial, control. Though in many states there is a constitutional provision requiring immediate confirmation by the legislature of any declaration of a state of emergency, in practice this gives little protection. States of emergency often arise out of unrest or terrorism on the part of members of a disadvantaged or oppressed minority and in such cases the Government will rarely have any difficulty in securing majority approval for the most repressive measures. And where the executive Government does not control a majority in the legislature, as in the aftermath of most military coups, it is usual for the legislature to be dissolved and for new elections to be promised. Any such elections, however, are likely to be repeatedly delayed and if they do eventually take place the military rulers will often have imposed a new constitutional order under which they hope to secure the support of any newly elected legislature."
DE FACTO DOCTRINE
In the case of Edwin Ward Scadding vm Louis Lorant (10 ER 164), dilating on the scope of de facto and de jure authority, the House of Lords, after consulting all the Judges came to the conclusion that a rate for the relief of the poor, which was lawfully made in other respects, could not be rendered invalid by the circumstance that some of the vestrymen, who concurred in making it, were vestrymen only de facto, and not de jure. Lord Chancellor St. Leonards enunciated the principle thus:
"With regard to the competence of the vestrymen, who were vestrymen de facto but not vestrymen de jure, to make the rate, your lordships will see at once the importance of that objection, when you consider how many public offices and persons there are who are charged with very important duties, and whose title to the office on the part of the public cannot be ascertained at the time. You will at once see to what it would lead if the validity of their acts, when in such office, depended upon the propriety of their election. It might tend, if doubts were cast upon them, to consequences of the most destructive kind. It would create' uncertainty with, respect to the obedience to public officers, and it might also lead to persons, instead of resorting to the ordinary legal remedies to set right anything done by the officers, taking the law into their own hands.
I think, therefore, that the principle laid down by the learned Judges, as the principle of law, is one that is in conformity with public convenience, with reference to the discharge of the duties connected with the office."
In the case of Toronto R. Co. and City of Toronto (46 DLR 547), the Ontario Supreme Court, after reviewing a' large number of decisions both American and English, came to the conclusion: -
"That it is not open to attack, in a collateral proceeding, the status of a de facto Judge, having at least a colourable title to the office, and that his acts are valid, is clear, I think, on principle and on authority, and it is also clear that the proper proceeding to question his right to the office is by quo warranto information."
Colley in his book on `Constitutional Limitations', Eighth Edition, Volume 2, page 1357, dealing with the subject, says as follows:
"No one is under obligation to recognize or respect the acts of an intruder, and for all legal purposes they are absolutely void. But for the sake of order and regularity, and to prevent confusion in the conduct of public business and insecurity and private rights, the acts of officers de facto are not suffered to be questioned because of the want of legal authority except by some direct proceeding instituted for the purpose by the State or by someone claiming the office de jure, or except when the person himself attempts to build up some 'right, or claim some privilege or emolument by reason of being the officer which he claims t0 be. In all other cases the acts of an officer de facto are as valid and effectual, while he is suffered to retain the office, as though he were an officer by right, and the same legal consequences will flow from them for the protection of the public and of third parties. This is an important principle which finds concise expression in the legal maxim that the acts of officers de facto cannot be questioned collaterally."
An officer de facto is defined by Colley in his above book at page 1353 as:
"One who by some colour of right is in possession of an office and for the time being performs its duties with public acquiescence though having no right in fact."
'In the case of Farzand Ali v. Province of West Pakistan PLD 1970 SC 98, this Court after considering the above cases came to the following conclusion: -
"This de facto ,doctrine is a doctrine of necessity, to bring about regularity and prevent confusion in. the conduct of public business and promote security of private rights."
In the book titled "Oxford Essays in Jurisprudence", compiled by J.M. Eekelaar, the Principles of Revolutionary Legality have-been given in Chapter II thereof. The relevant extracts from pages 29 and 39 to 43 have been reproduced in paragraph 40 ante.
After going through the record, we are inclined to hold that though initially the status of the present Government was de facto, but in view of J the validation accorded through the Short Order, it has attained the status of a, de jure Government.
VALIDATION OF THE PROCLAMATION, THE PCO 1 OF 1999 AND ORDER 1 OF 2000
The validity of the Proclamation, dated 14th October, 1999 and other succeeding documents falling in the same category depends upon a tentative assessment of the situation to be made with a view to giving effect to the attending circumstances. It is common ground between the petitioners, who have appeared in person, the learned counsel appearing on behalf of some of the petitioners, Syed Sharifuddin Pirzada, learned Sr. ASC, -as well as. the learned Attorney-General for Pakistan appearing on behalf of the - Federation, Dr. Farooq Hasan, appearing on behalf of the Lahore High Court Bar Association as also Mr. S.M. Zafar, learned Sr.ASC appearing as amicus cunae, that the situation created and/or which preceded the Proclamation dated 12th October, 1999 is the basis for the extra ?constitutional measure. However, M/s. Shahid Orakzai and Syed Iqbal Haider were of the view that the Proclamation and the other instruments issued by the Chief Executive are in accordance with the Constitution. It is not necessary to deal with the latter contention of M/s. Orakzai and Syed Iqbal Haider, which is ex facie untenable. Mr. Khairi's contention was that the Proclamation to the extent it impinges on the independence of Judiciary is not valid. We are also inclined to the same view.
The main thrust of the arguments of Ch. Muhammad Farooq, learned Sr. ASC, appearing on behalf of the petitioner in Constitutional Petition No.62 of 1999 was that the jurisdiction of the Courts cannot be ousted, civil liberties cannot be curtailed, principle of trichotomy of powers cannot be disturbed, the doctrine of State. necessity is outdated and even if it is allowed to be invoked, it should be for a limited period as contemplated in Sh. Liaqat Hussain's case (supra), emergency having already been proclaimed under Article 232 of the Constitution, there was no warrant for Proclamation all over again, the Armed Forces under Article 245 of the Constitution are required to work under the control and command of the Federal Government as mandated by the Constitution and not by superseding them, the Prime Minister and his cabinet colleagues were responsible only to the National Assembly under Article 91(4) of the Constitution and not to the Armed Forces, therefore, it was argued that the Proclamation of Emergency/PCO and the entire superstructure thereon is outside the contemplation of the Constitution.
There is no cavil with the proposition advanced by Ch. Muhammad Farooq regarding the constitutional position as also the role of the Army and the functions which the Armed Forces, the Prime Minister and Parliament/Assemblies perform under the Constitution. Be that as it may, admittedly the impugned action has not been taken under any constitutional provision, but is the result of an extra-constitutional measure and, therefore, reference to the above constitutional provisions is of no consequence. The sole question for consideration is whether the extra-constitutional measure taken by the Armed Forces could be validated on any ground or not. Recognition of a situation of whatever magnitude does call for remedial measures to be considered/contemplated with a view to purging the situation on the ground. All that is required to be considered is that the action should have a nexus with the facts on the ground. Such consideration can be undertaken only by the Superior Courts in the exercise of their powers under Articles 199 and 184 of the Constitution. It is the duty of the Superior Courts that they recognize the evil, suggest remedial measures therefor and lay down infrastructure for a journey leading to the restoration of the democratic processes/institutions as expeditiously as possible. If those responsible for achieving these objectives fall short of the measure within the contemplation of the law during their tenures respectively, then the remedy lies in identifying the facts on the ground and taking remedial measures 'to suppress the evil. The action of 12th October, 1999 being what it is, qualifies for validation on the ground of State necessity/survival. It is for the representatives of the people to see to it that everything is in order and nobody can raise his little finger when their actions are in line with the fundamentals of the Constitution. No rule except that by the representatives of the people within the contemplation of the Constitution and the law has the support of the Superior Judiciary. We are firmly committed to the governance of the country by the people's representatives and we reiterate the definition of the term `democracy' to the effect that "it is Government of the people, by the people and for the people" and not by the Army rule for- an indefinite period. It has already been emphasized in the Short Order that prolonged .involvement of the Army in civil affairs runs a g-rive risk of politicizingit, which would not be in national interest and that civilian rule in the country must be restored within the K shortest possible time after achieving the declared objectives as reflected in the speeches of the Chief Executive, dated 13th and 17th October, 1999, which necessitated the military takeover. (Underlining is by way of emphasis)
An overall view of the whole spectrum of circumstances prevalent on or before 12th October, 1999 reveals that the representatives of the people who were responsible for running the affairs of the State were accused of corruption and corrupt practices and failed to establish good governance in the country as a result whereof a large number of references have been filed against the former Prime Minister, Ministers. Parliamentarians and members of the Provincial Assemblies for their disqualification on account thereof. The process of accountability carried out by the former Government was shady, inasmuch as, either it was directed against the political rivals or it was not being pursued with due diligence. We have also noted with concern that all institutions of the State including L Judiciary were being systematically-destroyed in the pursuit of self-serving policies. We uphold the plea raised on behalf of the Federation that the democratic institutions were not functioning in accordance with the Constitution, they had become privy to the one man rule and the very purposes for which they were established stood defeated by their passive conduct.
We see no ground to disbelieve the statement made by the Chief of Army Staff/Chief Executive that attempts were made to politicise the army, destabilise it and create dissension within its ranks. Had the former Prime Minister been successful in his designs, there would have been chaos and anarchy rather a situation of civil war where some factions of Armed Forces were fighting against others.
There is no force in the submission of Mr. Shahid Orakzai that the impugned action of the Armed Forces was within the contemplation of the Constitution as envisaged by Articles 46, 48., 90 and 99 of the Constitution. Suffice it to say that extra constitutional nature of the situation did not have any nexus/connection with the provisions of the Constitution relating to the working of the Federal Government in line with the provisions for its continuation in office in the event of its dismissal "within the contemplation of the Constitution". Put differently, the action dated 12-10-1999 is in itself sufficient to be equated with something beyond the contemplation of the Constitution and, therefore, no question regarding the same being attended to by the Courts for resolution by treating it as having been taken under the Constitution arises. Viewed in this context, the reference to Articles 46, 48, 90 and 99 of the Constitution by Mr. Shahid Orakzai is wholly irrelevant. The above Articles do not provide a solution regarding the circumstances prevalent on 12th October, 1999.
IMPORT OF THE TERM `CHIEF EXECUTIVE'
Chief Executive'. In the case of Fazalul Qadir Chaudhry PLD 1963 SC 486 this Court treated the President as Chief Executive. Similarly, in American
Constitutional Law, 1995 Edition, at M page 204, President of America is described asChief Executive'. The Constitution of 1973 envisages parliamentary form of Government where the Prime Minister acts as the Chief
Executive of the country. By means of the Proclamation of Emergency as also the
PCO 1 of 1999, the Constitution has only been held, in abeyance and the country is to be run as nearly as may be in accordance with the Constitution, therefore, General Pervez Musharraf while taking over the affairs of the country assumed to himself the title of "Chief Executive". Since practically, he is performing the functions of the Prime Minister, he holds the position of Chief Executive in the scheme of the-Constitution and the criticism on this aspect is uncalled for.AMENDMENT OF THE CONSTITUTION
After having validated the ,action of l2th October, 1999 on the touchstone of the doctrine of State Necessity, it is necessary to consider the next very important and allied question as to whether the Chief Executive should be given the power to amend the Constitution and if so, to what extent? We have taken pains to examine the pros and cons of this issue, which is definitely ,of far reaching consequences. Mr. Khalid Anwar vehemently opposed the conferment of such a power on the Chief Executive on the ground that it is opposed to the doctrine of separation of powers, which has evolved. through the history of civilization. He submitted that all men, be they wise such as Socrates, the most knowledgeable such as Aristotle and the most virtuous such as Imam Abu Hanifa, need be subject to the limits of checks and balances to prevent tyranny. He submitted that the Chief Executive himself has pledged to preserve the Constitution, inasmuch as it -is the case of the Government itself that they. have not proclaimed Martial Law and only Emergency has been proclaimed for a transitional period to save the system and, thus, the Court should restrict him within the legal/constitutional limits.
Mr. S.M. Zafar, after drawing a distinction between a coup d'etat and a revolution submitted that the change on 12th October, 1999, does not claim to be based on the principle of revolutionary legality, hence the principle of Dosso's case is not relevant and Kelsen's theory is not applicable to the facts and circumstances of the present case. The logical conclusion in view thereof is that the new regime, if it is not a revolutionary regime, cannot claim to be the law giving source and its legislative powers are to be spelt out by the Courts. The case of the Government on the other hand is that once it is found that the prevailing situation did warrant an abrupt change and there was no remedy available under the prevailing Legal Order, the persons responsible for the change are fully competent to bring about such change in law, including the Constitution, which intends to correct the flawed Old Legal Order for preservation of the State as well as welfare of the people as held in Begum Nusrat Bhutto's case (supra). The learned Attorney-General further submitted that revolutionary political change is not in derogation of the Objectives Resolution under Article 2A of the Constitution, as ultimately the method of Governance shall be through chosen representatives of the people.
Lord Pearce in the Privy Council decision of Madzimbuto v. Lardner Burke (1968) 3 AER 561, on the question of change of basic Order of State held as under:-
"It required the recognition of some acts of the illegal revolutionary Government. If one disregards all illegal provisions for the needs of the country, there is a vacuum in the law and chaos" (at p. 736)
In the leading American case, Texas v. White, 74 US ( 7 Wall ) 700 (at p.733), 1868, the Court allowed recognition and allowance for "all acts to be validly performed which are necessary to peace and good order among citizens." Thus, all actions and acts necessary for the running of the State are naturally to be performed.
In Madzimbuto v. Lardner Burke, 1966 Rhodesian L.Rep. 228 (General Division) Justice Lewis said:
"In circumstances wherein a Unilateral Declaration of Independence has taken place, there are measures by the Government which is in effective control which must of necessity receive recognition from the Courts on the simple basis that one cannot have a complete vacuum in the Law, and all such measures as are necessary for the purposes of ordinary good Government, and maintenance of law and order should receive recognition from Courts. (at p. 233 ).
"Coups d'etat and palace revolutions, where power changes from one man to another, from one clique to another, depending upon on the form of Government in which the coup d'etat occurs have been less feared because of the change they bring about is circumcised to the sphere of Government itself and carries a minimum of unquiet to the people at large. "
(1)??????? The existence of imperative inevitability or exceptional circumstances when the coup occurred.
(2) No other remedy was available in that system to meet the exceptional emergency.
(3)??????? The measures taken by the taking over military authority or group is both proportionate and necessary.
(4)??????? The alteration by the usurper must be of admittedly a temporary nature. (See de Smith, Constitutional Lawyers in Revolutionary Situations, 7 W. Ont. L.R., 1968, 24 at 100).
We are of the view that the above question is hyper-technical in nature and no tangible consequences will result by particularly using one or the other term. In coup d'etat as well in revolution, power changes from one man to another from one clique to another depending upon the facts and circumstances of each case. Coup d'etat is generally undertaken to achieve a particular objective motivated by various considerations. Leading Oxford Professor A.Honore, in his work while discussing the cases of Pakistan, Uganda and Rhodesia under the caption "Revolutions" published in the Irish Jurist, 1977 also took the same view. We are, therefore, of the view that in the context of the present case the terms. coup d'etat and revolution are interchangeable and, nothing substantial would, turn on considering it from one angel and another.
The question arises whether the Chief Executive can be granted unfettered powers to amend the Constitution. Mr. Khalid Anwar emphasised that in case the Army action is condoned/validated this Court must succinctly state whether the Chief Executive has power to amend the Constitution and if so, subject to what limitations. He emphasised that in the first instance power to amend the Constitution should not be conceded to the Chief Executive and Begum Nusrat Bhutto's case (supra) should be re?visited. In case this Court follows the dictum of Begum Bhutto's case (supra), the power to amend the Constitution by the Chief Executive must be stated with particularity and the fields which are not to be touched should be specifically stated. Mr. -S. Sharifuddin Pirzada argued that once the Army action through extra-constitutional measure is validated, the Chief Executive should be given the power to amend the Constitution. Same view was expressed by the learned Attorney-General and Dr. Farooq Hassan. We are y of the -considered view that if the Parliament cannot alter the basic features of the Constitution, as held by this Court in Achakzai's case (supra), power to amend the Constitution cannot be conferred on the Chief Executive of the measure larger than that which could be exercised by the Parliament. Clearly, unbridled powers to amend the Constitution cannot be given to he Chief Executive even during the transitional period even on the touchstone of `State necessity'. We have stated in unambiguous terms in the Short Order that the Constitution of Pakistan is the supreme law of the land and its basic features i.e independence of Judiciary, .federalism and parliamentary form of government blended with Islamic Provision cannot be altered even by the Parliament. Resultantly, the power of the Chief Executive to amend the Constitution is strictly circumscribed by the limitations laid down in the Short Order vide sub-paragraphs (i) to (vii) of paragraph 6.
We have held in the Short Order that the cases of learned former I Chief Justice and Judges of the Supreme Court, who had not taken oath under the Oath of Office (Judges) Order, 2000 (Order 1 of 2000), and those Judges of the Lahore High Court, High Court of Sindh and Peshawar High Court, who were not given oath, cannot be reopened, being hit by the doctrine of past and closed transaction.
The practical effect of the above observation is that the action of the Chief Executive in this behalf has been validated. It is a well-settled principle that in such situations the Court may, refuse relief in respect of a particular decision, but go on to determine the general question of law or interpretation that the case raises. Clearly, the Judges of the Superior Judiciary enjoy constitutional guarantee against arbitrary removal. They can be removed only by following the procedure laid down in Article 209 of the Constitution by filing an appropriate reference before the Supreme .Judicial Council and not otherwise. The validity of the action of the Chief Executive was open to question on the touchstone of Article 209 of the Constitution. But none of the Judges took any remedial steps and accepted pension as also the right-to practice law and thereby acquiesced in the action. Furthermore, the appropriate course of action for this Court in these proceedings would be to declare the law to avoid the recurrence in future, but not to upset earlier actions or decisions taken in this behalf by the Chief Executive, these being past and closed transactions. The principle is well-settled that the Courts can refuse relief in individual cases even though the action is flawed, depending upon the facts and circumstances of each case. The action of Chief Executive in the context given above has not encroached on the judicial power or impaired it in the process. However, the observations made herein as to the declaration of law under Article 209 of the Constitution would not entitle the relevant authorities or this Court to reopen the cases of the above Judges which have become final. On the question of legislative power in relation to Court's declaration of law, the matter stands concluded by the judgment of this Court in Muhammad Yusuf v. The Chief Settlement and Rehabilitation Commissioner Pakistan, Lahore and another PLD 1968 SC 101 in the following terms:
"This judgment was delivered on the 2nd November, 1964, and its consequence was that as from that date all Courts subordinate to the Supreme Court and all executive and quasi-judicial authorities were obliged by virtue of the Constitution to apply the rule as laid down by the Supreme Court in cases coming up before them for decision. It did not have, and it cannot be contended that it had, the effect of altering the law as from the commencement of the Act so as to render void of its own force all relevant orders of the Settlement Authorities or of the High Court made in the light of the earlier interpretation which was that the exercise of the delegated power was subject to the provisions in Chapter VI of the Act."
We; therefore, declare that the Judges of the Supreme Court and High Courts cannot be removed without resorting to the procedure prescribed in Article 209 of the Constitution, but the cases of Judges who S ceased to be Judges of the Supreme Court and High Courts by virtue of Oath S of Office (Judges) Order, 2000 (Order 1 of 2000) is hit by the doctrine of past and closed transaction and cannot be reopened.
Towards the close of his arguments, Mr. Khalid Anwar submitted that this Court should lay down a roadmap with a timetable for the return of Constitutional governance. Mr. Haleem Pirzada, President, Supreme Court Bar Association submitted that 12 months' time from now may be provided to the Armed Forces so that they do the cleansing and go back. During the course of his arguments, Mr. S.M. Zafar, amicus curiae stated that prolonged stay of the Armed Forces in the political arena would damage its professionalism, hence they should retreat to their Barracks as early as possible. On this issue, the learned Attorney-General made the following statement:
"That the Federation -intends to restore true representative democracy in the country as early as possible. It is, however, not possible to give specific timeframe for the above among others for the reasons that the authorities/Government require time for:
(a)??????? Revival of country's economy, which stands ruined, as submitted before this Court;
(b)??????? For completion of the process of accountability;
(c)??????? Recovery of huge plundered national wealth including bank loans running into billions of rupees and foreign exchange abroad worth billions of US dollars;
(d)??????? The task of unavoidable electoral reforms including preparation of fresh electoral rolls;
(e)??????? To ensure harmonious and efficient working of the important organs of the State, stable and good governance including maintenance of law and order, to prevent abuse of power, and to ensure and safeguard smooth functioning and enjoyment of democracy by the people."
We are not in favour of an Army rule in preference to a democratic rule. There were, however, evils of grave magnitude with the effect that the civilian governments could not continue to run the affairs of the country in the face of complete breakdown. The remedy to the said evil was the holding of fair and impartial elections by the Chief Election Commissioner at the earliest possible time, but the same could not be achieved till the electoral rolls are updated. Ordinarily, we would have allowed minimum time for holding of fresh elections as contemplated under the Constitution, but the learned Attorney-General made a statement at the Bar that as per report of the Chief Election Commissioner, updating of the electoral rolls could not be done before two years and thereafter objections and delimitation process etc. were to be attended to. Mr.Sartaj Aziz, Senator, and the M:Q.M. in their respective Petitions Nos.i5 and 53 of 1996 had also taken the stand that in the absence of proper and authentic electoral rolls, millions of people will be disenfranchised. This statement of the learned Attorney-General was not rebutted. This being so, there is no choice but to grant reasonable time to enable the Chief Executive to restore the democratic institutions to the rightful holders of the Office of public representatives under the Constitution.
The above are the reasons in support of the Short Order, dated 12th May. 2000, whereby the above Constitution Petitions were disposed of in the terms mentioned in it. The Short Order reads thus: -
??????????? SHORT ORDER
For detailed reasons to be recorded later, we intend to dispose of the above petitions under Article 184(3) of the Constitution, directed against the Army take-over of 12th October, 1999, the Proclamation of Emergency dated 14th October, 1999, the Provisional Constitution Order No. 1 of 1999 and the Oath Of Office (Judges) Order No. 1 of 2000, in the. following terms:-
INDEPENDENCE OF JUDICIARY
Stability in the system, success of the Government, democracy, good governance, economic stability, prosperity of the people, tranquillity, peace and maintenance of law and order depend to a considerable degree on the interpretation of Constitution and legislative instruments by the Superior Courts. ' It is, therefore, of utmost importance that the Judiciary is independent and no restraints are placed on its performance and operation. It claims and has always claimed that it has the right to interpret the Constitution or any legislative .instrument and to say as to what a particular provision of the Constitution or a legislative instrument means or does not mean, even if that particular provision is a provision seeking to oust the jurisdiction of this Court. Under the mandate of the Constitution, the Courts exercise their jurisdiction as conferred upon them by the Constitution or the law. Therefore, so long as the Superior Courts exist, they shall continue to exercise powers and functions within the domain of their jurisdiction and shall also continue to exercise power of judicial review in respect of any law or provision of law, which comes for examination before the Superior Courts to ensure that all persons are able to live securely under the rule of law; to, promote, within the proper limits of judicial functions, the observance and the attainment of human and Fundamental Rights; and to administer justice. impartially among persons and between the persons and the State, which is a sine qua non for the maintenance of independence of Judiciary and encouragement of public confidence, in the judicial system.
TAKING OF OATH UNDER PCO NO. 1 OF 1999
Fresh oath under Oath of Office (Judges) Order No. 1 of 2000, does not in any way preclude the Judges of this Court from examining the questions raised in the above petitions, which have to be decided in accordance with their conscience and law so as to resolve the grave crises and avoid disaster by preventing imposition of Martial Law for which the Constitution does not provide any remedy.
New oath of office 'was taken by the Judges of this Court under PCO No. 1 of 1999 read with Oath of Office (Judges) Order No. 1 of 2000 with a view to reiterating the well-established principle that the first and the foremost duty of the Judges of the Superior Courts is to save the judicial organ of the State. This was exactly what was done. By Virtue of PCO No. 1 of 1999, the Constitution has not lost its effect in its entirety although its observance as a whole has been interrupted for a transitional period. The activity launched by the Armed Forces through an extra .constitutional measure, involves the violation of "some of the rights" protected by the Constitution, which still. holds the field but some of its provisions have been held in abeyance. A duty is cast upon the Superior Judiciary to offer some recompense for those rights which were purportedly violated in view of the promulgation of PCO No. 1 of 1999. This could be achieved only by taking ' the Oath and not by declining to do so and thereby becoming a party to the closure of the Courts, which would not have solved any problem whatsoever but would have resulted in chaos, anarchy and disruption of peaceful life. Independence of Judiciary does not mean that Judges should quit their jobs and become instrumental in the closure of the Courts. Indeed, the latter course would have been the most detestable thing to happen. Independence of Judiciary means that the contentious matters, of whatever magnitude they may be, should be decided/resolved by the Judges of the Superior Courts according to their conscience. This Court, while performing its role as "the beneficial expression of a laudable political realism", had three options open to it in relation to the situation arising out of the military take-over on Twelfth day of October, 1999: firstly, it could tender resignation en bloc, which most certainly could be equated with sanctifying (a) chaos/anarchy and (b) denial of access to justice to every citizen of Pakistan wherever he may be; secondly, a complete surrender to the present regime by dismissing these petitions for lack of jurisdiction in view of the purported ouster of its jurisdiction under PCO No. 1 of 1999 and thirdly, acceptance of the situation as it is, in an attempt to save what "institutional values remained to be saved". This Court, after conscious deliberations and in an endeavour to defend and preserve the national independence, the security and stability of Pakistan, sovereignty and honour of the country and to safeguard the interest of the community as a whole, decided to maintain and uphold the independence of Judiciary, which, in its turn, would protect the State fabric and guarantee human rights/Fundamental Rights. It took the Oath under PCO . No. 1 of 1999 so as to secure the enforcement of law, extend help to the law enforcing agencies for maintenance of public order and with `a view to restoring democratic institutions, achieving their stability and guaranteeing constitutional rights to the people of Pakistan.
Oath of Office prescribed under Articles 178 and 194 of the Constitution for the Judges of the Superior Courts contains a specific provision that a Judge shall abide by the Code of Conduct issued by the Supreme Judicial Council. Same is the position with regard to the provisions regarding Oath of Office (Judges) Order No. 1 of 2000. The precise provisions in the Oath of Office (Judges) Order, 2000 are that a Judge, to whom oath is administered, shall abide by the provisions of Proclamation of Emergency of Fourteenth day of October, 1999, PCO No. 1 of 1999, as amended, and the Code of Conduct issued by the Supreme Judicial Council. But there is specific omission of words, "to preserve and defend the Constitution". Adherence to the Code of Conduct has not been subjected to any pre-conditions and there can be no deviation from it by a Judge who takes oath either under the Constitution or PCO No. 1 of 1999 or Oath of Office (Judges) Order No. 1 of 2000. One of the requirements of the Code of Conduct is that the oath of a Judge implies complete submission to the Constitution, -and under the Constitution to the law. Subject to these governing obligations, his function of interpretation and application of the Constitution and the law is to be discharged for the maintenance of the Rule of Law over the whole range of human activities within the nation. Thus, the new Oath merely indicates that the Superior Judiciary, like the rest of the country had accepted the fact that on 12th October, 1999, a radical transformation took place.
MAINTAINABILITY OF PETITIONS
Notwithstanding anything contained in the Proclamation of Emergency of the Fourteenth day of October, 1999, the Provisional Constitution Order No. 1 of 1999, as amended and the Oath of Office (Judges) Order No. 1 of 2000, all of which purportedly restrained this Court from calling in question or permitting to call in question the validity of any of the provisions thereof, this Court, in the exercise of its inherent powers of judicial review has the right to examine the validity of the aforesaid instruments. Additionally, submission of the Federation in response to the Court's notice concerning its own legitimacy also suggests that this Court has an inherent authority, arising from the submission of both the parties to its jurisdiction, notwithstanding. the preliminary objection raised in the written statement as to the maintainability of the above petitions. In the exercise of its right to interpret the law, this Court has to decide the precise nature of the ouster clause in the above instruments and the extent to which the jurisdiction of the Courts has been ousted, in conformity with the well-?established principles. that the provisions seeking to oust the jurisdiction of the Superior Courts are to be construed strictly with a pronounced leaning against ouster. The Constitution Petitions filed by the petitioners under Article 184(3) of the Constitution are, therefore, maintainable.
INTERVENTION BY ARMED FORCES
National Assembly is the highest representative body, which reflects the will and aspirations of the people of Pakistan. Similar is the status of a Provincial Assembly in a Province. Senate, being a symbol of unity of the federating units has its own utility for the country as a whole. It is, therefore, of utmost importance that the impugned suspension of the above democratic institutions is examined with great care and caution, otherwise it would adversely affect the democratic processes in the country, which may cause instability, impair the economic growth and resultantly ' prove detrimental to the general well-being of the people. However, where the representatives of the people, who are responsible for running the affairs of the State are themselves accused of massive corruption and corrupt practices and in the public as well as private sectors are benefiting therefrom and resist establishing good governance; where a large number of references have been filed against the former Prime Minister, Ministers, Parliamentarians and members of the Provincial Assemblies for their disqualification on account of corruption and corrupt practices; where there is a general perception that corruption is being practised by diversified strata including politicians. parliamentarians public officials and ordinary citizens and that a number of Parliamentarians and members of the Provincial Assemblies misdeclared their assets before Election Commission and Tax Authorities; where there was no political and economic stability and bank loan defaults were rampant and that as per report of Governor, State Bank of Pakistan Rs. 356 billion are payable by the, bank defaulters up to 12-10-1999. having no accountability and transparency; where economic stability in Pakistan was highly precarious and there was an overall economic slowdown as GDP growth during the past three years had hardly kept pace with the growth of population; where Pakistan has a debt' burden, which equals the country's entire national income; where all the institutions of the State were being systematically destroyed and the economy was in a state of collapse due to. self-serving policies of the previous government, which had threatened the existence, security, economic life, financial stability and credit of Pakistan; where a situation had arisen under which the democratic institutions were not functioning in accordance with the provisions of the Constitution, inasmuch as, the Senate and the National and Provincial Assemblies were closely associated with the former Prime Minister and there was no real democracy because the country was, by and large, under one man rule; where an attempt was made to politicize the Army, destabilize it and create dissension within its ranks and where the Judiciary was ridiculed, leaving no stone unturned to disparage and malign it by making derogatory and contemptuous speeches by some of the members of the previous ruling party inside and outside the Parliament and no. Reference was made tar the Chief Election Commissioner for their, disqualification as members of the Parliament under Article 63 (2) of the Constitution; where the disparaging remarks against the Judiciary crossed all limits with the rendering of judgment by this Court in the case of Sh. Liaquat Hussain v. Federation of Pakistan PLD 1999 SC 504, declaring the establishment of Military Courts as ultra vires the Constitution, which resulted into a slanderous campaign against the Judiciary launched by the former Prime Minister registering his helplessness in. the face of the Judiciary not allowing him the establishment of Military Courts as a mode of speedy justice; where the image of the Judiciary was tarnished under a well conceived design; where the telephones of the Judges of the Superior Courts and other personalities were tapped in spite of the law laid down by this i Court in the case of Mohtarma Benazir Rhutto v. President of Pakistan PLD 1998 SC 388, that tapping of telephones and eavesdropping was immoral, illegal and unconstitutional; where storming of the Supreme Court was resorted to allegedly by some of the leaders and activists of the Pakistan Muslim League which ultimately led to the issuance of contempt notices against them/contemners by the Full Bench of this Court in a pending appeal; where Mian Nawaz Sharif's constitutional and moral authority stood completely eroded and where situation was somewhat similar and analogous to the situation that was prevalent in July, 1977, the extra constitutional step? of taking over the affairs of the country by the Armed Forces for a transitional period to prevent any further destabilization, to create corruption free atmosphere at national level through transparent accountability and revive the economy before restoration of democratic institutions under the Constitution, is validated, in that Constitution offered no solution to the present crisis.
In the Commonwealth Finance Ministers Meeting, held on 21-23rd September, 1999, commenting on the Framework for Commonwealth Principles on Promoting Good Governance and Combating Corruption, it was, inter alia, observed that; "Good governance is not a luxury but a basic requirement for development. Corruption, which undermines development, is generally an outcome and a symptom of poor governance. It has reached global proportions and needs to be attacked directly and explicitly ."????..The Commonwealth should firmly commit itself to the policy of "zero tolerance" of all types of corruption. This policy must permeate national political cultures, governance, legal systems and administration. Where corruption is ingrained and pervasive, especially at the highest political levels, its eradication may require a sustained effort over a protracted period of time. However, the policy of "zero tolerance" should be adopted froth the outset, demonstrating a serious commitment to pursue the fight against corruption. The Commonwealth should remain firm inns determination that the high standards and goals enunciated in the 1991 Harare Declaration are upheld and enhanced. Creating an environment, which is corruption-free will require vigorous actions at the national and international levels, and within the Commonwealth itself. These actions should encompass the prevention of corruption, the enforcement of laws against it and the mobilization of public support for anti-corruption strategies".
Probably, the situation could have been avoided if Article 58(2)(b) ; of the Constitution had been .in the field, which maintained parliamentary form of Government and had provided checks and balances between the powers of the President and the Prime Minister to let the system run without any let or hindrance to forestall the situation in which Martial Law can be imposed. With the repeal of Article 58(2)(b) of the Constitution, there was no remedy provided in the Constitution to meet the situation like the present one with which the country was confronted, therefore, constitutional deviation made by the Chief of the Army Staff, General Pervez Musharraf for the welfare of the people rather than abrogating the Constitution or imposing Martial Law by means of an extra constitutional measure is validated for a transitional period on ground of State necessity and on the principle that it is in public interest to accord legal recognition to the present regime with a view to achieving his declared objectives and that it is in the interest of the community that order be preserved. Legal recognition/ legitimacy can be accorded to the present regime also on the principle that the Government should be by the consent of the governed, whether voters or no; Here there is an implied consent of the governed i.e. the people of Pakistani in general including politicians/parliamentarians, etc. to the army take-over, in that no protests worth the name or agitations have been launched against the army take-over and/or its continuance. The Court can take judicial notice of the fact that the people of Pakistan have generally welcomed the army take-over due to their avowed intention' to initiate the? process of across the board and transparent accountability against those, alleged of corruption in every walk of life, of abuse of national wealth and A of not taking appropriate measures for stabilizing the economy and democratic institutions. Another principle, which is attracted is that since an extra-constitutional action has been taken by General Pervez Musharraf wielding effective political power, it is open to the Court to steer a middle course so as to ensure that the frame-work of the pre-existing Order survives but the constitutional deviation therefrom be justified on the principle of necessity, rendering lawful what would otherwise be unlawful. However, prolonged involvement of the Army in civil affairs runs a grave risk of politicizing it, which would not be in national interest, therefore, civilian rule in the country must be restored within the shortest possible time after achieving the declared objectives, which necessitated the military take over and Proclamation of Emergency as spelt out from the speeches of the Chief Executive, dated 13th and 17th October, 1999. The acceptance of the above principles do not imply abdication from judicial review in the transient. suspension of the previous legal order.
We accordingly hold as under:-
1.???????? On 12th October, 1999 a situation arose for which the Constitution provided no solution and the intervention by the Armed Forces through an extra constitutional measure became inevitable, which is hereby validated on the basis of the doctrine of State necessity and the principle of salus populi suprema lex as embodied in Begum Nusrat Bhutto's case. The doctrine of State necessity is recognised? not only in Islam and other religions of the world but also accepted by the eminent international jurists including Hugo, Grotius, Chitty and De Smith and some Superior Courts from foreign jurisdiction to fill a political vacuum and bridge the gap.
2.???????? Sufficient corroborative and confirmatory material has been produced by the Federal Government in support of the intervention by the Armed Forces through extra-constitutional measure. The material consisting of newspaper clippings, writings, etc. in support of the impugned intervention is relevant and has been taken into consideration as admissible material on the basis of which a person of ordinary prudence would conclude that the matters and events narrated therein did occur. The findings recorded herein are confined to the controversies involved in these cases alone.
3.???????? All past and closed transactions, as well as such executive actions as were required for the orderly running of the State and all acts, which tended to advance or promote the good of the people, are also validated.
4.???????? That the 1973 Constitution still remains the supreme law of the land subject to the condition that certain parts thereof have been held to abeyance on account of State necessity;
5.???????? That the Superior Courts continue to function under the Constitution. The mere fact that the Judges of the Superior Courts have taken a new oath under the Oath of Office (Judges) Order No.l of 2000, does not in any manner derogate from this position, as the Courts had been originally established under the 1973. Constitution, and have continued in their functions in spite of the Proclamation of Emergency and PCO No. 1 of 1999 and other legislative instruments issued by the Chief Executive from time to time;
6(i)?????? That General Pervez Musharraf, Chairman, Joint Chiefs of Staff Committee and Chief of Army Staff through Proclamation of Emergency, dated the 14th October, 1999, followed by PCO 1 of 1999, whereby he has been described as Chief Executive, having validly assumed power by means of an extra-Constitutional step, in the interest of the State and for the welfare of the people, is entitled to perform all such acts and promulgate all legislative measures as enumerated hereinafter, namely:-
(a)??????? All acts or legislative measures which are in accordance with, or could have been made under the 1973 Constitution, including the power to amend it;
(b)??????? All acts which tend to advance or promote the good of the people;
(c)??????? All acts required to be done for the ordinary orderly running of the State; and
(d)??????? All such measures as would establish or lead to the establishment of the declared objectives of the Chief Executive.
(ii) That Constitutional Amendments by the Chief Executive can be resorted to only if the Constitution fails to provide a solution; for attainment of his declared objectives and further that the power to amend the Constitution by virtue of clause (6) sub?clause (i) (a) ibid is controlled by sub-clauses (b)(c) and (d) in the same clause.
(iii)?????? That no amendment shall be made in the salient features of the Constitution i.e. independence of Judiciary, federalism, parliamentary form of Government blended with Islamic provisions.
(iv)?????? That Fundamental Rights provided in Part II, Chapter 1 of the Constitution shall continue to hold the field but the State will be authorized to make any law or take any executive action in deviation of Articles 15, 16, 17, 18, 19 and 24 as contemplated by Article 233 (1). of the Constitution, keeping in view the language of Articles 10, 23 and 25 thereof.
(v) That these acts, or any of them, may be performed or carried out by means of orders issued by the Chief Executive or through Ordinances on his advice;
(vi)?????? That the Superior Courts continue to have the power of judicial review, to judge the validity of any act or action of the Armed Forces, if challenged, in the light of the principles underlying the law of State necessity as stated above. Their powers under; Article 199 of the Constitution, thus, remain available to their full extent, and may be exercised as heretofore, notwithstanding anything to the contrary contained in any legislative instrument enacted by the Chief Executive and/or any order issued by the Chief Executive or by any person or authority acting on his behalf.
(vii) That the Courts are not merely to determine whether there exists any nexus between the orders made, proceedings taken and acts done by the Chief Executive or by any authority or person acting on his behalf, and his declared objectives as spelt out from his speeches, dated 13th and 17th October, 1999, on the touchstone of State necessity but such orders made, proceedings taken and acts done including the legislative measures, shall also be subject to judicial review by the Superior Courts.
6.???????? That the previous Proclamation of Emergency of 28th May, 1998 was issued under Article 232(1) of the Constitution whereas the present Emergency of 14th October, 1999 was proclaimed by way of an extra-Constitutional step as a follow up of the Army take-over which also stands validated notwithstanding the continuance of the previous Emergency which still holds the field.
7.???????? That the validity of the National Accountability Bureau Ordinance, 1999 will be examined separately in appropriate proceedings ,at appropriate stage.
8.???????? That the cases of learned former Chief Justice and Judges of the Supreme Court, who had not taken oath under the Oath of Office (Judges) Order, 2000 (Order 1 of 2000), and those Judges of the Lahore High Court, High Court of Sindh and Peshawar High Court; who were not given oath, cannot be re-opened being hit by the doctrine of past and closed transaction.
9.???????? That the Government shall accelerate the process of accountability I, in a coherent and transparent manner justly; fairly equitably and in accordance with law.
10.?????? That the Judges of the Superior Courts are also subject to accountability in accordance with the methodology laid down in Article 209 of the Constitution.
11.?????? General Pervez Musharraf, Chief of the Army Staff and Chairman Joint Chiefs of Staff Committee is a holder of Constitutional post. His purported arbitrary removal in violation of the principle of audi alteram partem was ab initio void and of no legal effect.
12.?????? That this order will not affect the trials conducted and convictions recorded including proceedings for accountability pursuant to various orders made and Orders/laws promulgated by the Chief Executive or any person exercising powers or jurisdiction under his authority and the pending trials/proceedings may continue subject to this order.
13.?????? This is not a case where old legal order has been completely suppressed or destroyed, but merely a case of constitutional deviation for a transitional period so as to enable the Chief Executive to achieve his declared objectives.
14.?????? That the current electoral rolls are out-dated. Fresh elections cannot be held without updating the electoral rolls. The learned Attorney-General states that as per report of the Chief Election Commissioner this process will take two years. Obviously, after preparation of the electoral rolls some time is required for delimitation of constituencies and disposal of objections, etc.
15.?????? That .we take judicial notice of the fact that ex-Senator Mr. Sartaj Aziz moved a Constitution Petition ' No. 15 of 1996, seeking a mandamus to the concerned authorities for preparation of fresh electoral rolls as, according to Mr. Khalid Anwar, through whom, the above petition was filed, the position to the contrary was tantamount to perpetuating disenfranchisement of millions of people of Pakistan in violation of Articles 17 and 19 of the Constitution. Even MQM also resorted to a similar Constitution Petition bearing No. 53 of 1996 seeking the same relief. However, for reasons best known to the petitioners in both the petitions, the same were not pursued any further.
17.?????? That the Chief Executive shall appoint a date, not later than 90-days before the expiry of the aforesaid period of three years, for holding of a general election to- the National Assembly and the Provincial Assemblies and the Senate of Pakistan.
18.?????? That this Court has jurisdiction to review/re-examine the continuation of the Proclamation of Emergency, dated 12th October, 1999 at any stage if the circumstances so warrant as held by this Court in the case of Sardar Farooq Ahmed Khan Leghari v. Federation of Pakistan PLD 1999 SC 57.
Before parting with this judgment we would like to record our deep appreciation for the valuable assistance rendered by the learned counsel appearing on behalf of both the parties as also the learned amicus curiae all of whom had put forward their view point in the most illuminating manner enabling us to reach the conclusions we did in this judgment.
M.B.A./Z-11/S ?????????????????????????????????????????????????????????????????????????????????? Order accordingly
P L D 2000 Supreme Court (AJ&K) 1
Present: Sardar Said Muhammad Khan, CJ., Basharat Ahmad Shaikh and Muhammad Yunus Surakhvi, JJ
Civil Appeal No. 108 of 1998
AZAD GOVERNMENT OF THE STATE OF JAMMU AND KASHMIR through Chief Secretary, Muzaffarabad and 3 others---Appellants
Versus
MUHAMMAD ANWAR SHAH---Respondent
(On appeal from the order of the High Court dated 18-4-1998 in Civil Appeal No.54 of 1997).
Civil Appeal No. 113 of 1998
AZAD GOVERNMENT OF JAMMU AND KASHMIR through Chief Secretary, Muzaffarabad and 2 others---Appellants
Versus
MUHAMMAD ANWAR -SHAH---Respondent
(On appeal from the order of the High Court dated 18-4-1998 in Civil Appeal No.55 of 1997).
Civil Appeals Nos. 108 and 113 of 1998, decided on 13th May, 1999.
(a) Land Acquisition Act (I of 1894)---
----Ss. 4, 23 & 24---Azad Jammu and Kashmir Interim Constitution Act (VIII of 1974), Ss.42 & 44---Acquisition of land---Market value, meaning of---Determination of compensation---Market value would mean, value of land which a willing purchaser was prepared to pay and a willing seller was prepared to sell for---Inclination of vendor to part with his land and urgent necessity of purchaser to buy or the use to which land would be put after acquisition, were to be ignored---Any increase, in the value of other land of person interested, likely to accrue from the use for which land was acquired, was not to be considered while ascertaining market value---Compensation of acquired land was to be assessed according to the market value of land at the time of publication of notification under SA(l), Land Acquisition Act, 1894---Finding of High Court that as land acquired was to be used for construction of road, compensation thereof was to be paid at uniform rate, irrespective of the kind of land and other recongnised principles on the basis of which market value was to be determined, being violative of said principle of law, was set aside by Supreme Court in circumstances.
West Pakistan WAPDA .v. Mst. Hiran Begum 1972 SCMR 138; District Welfare Officer, Guntur v. Pillalamarri Ramakrishans Somayajuly and others AIR 1963 Adh.Para.328 and Deputy Commissioner, Karachi v. Abu Bakar and others PLD 1972 Kar.128 ref.
(b) Words and phrases---
------ Market value "---Meaning.
Kh. Atta Ullah, Additional Advocate-General for Appellants. Ghulam Mustafa Mughal, Advocate for Respondent.
Date of hearing: 5th May 1999.
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P L D 2000 Supreme Court (AJ&K) 20
Present: Sardar Said Muhammad Khan, C. J. and Muhammad Yunus Surakhvi, J
MUHAMMAD SIDDIQUE---Appellant
Versus
ABDUL KHALIQ and 28oers---Respondents
Civil Appeal No.56 of 1999, decided on 22nd October 1999.
(On appeal from the judgment of the High Court dated 29-1-1999 in Civil Revision No.25 of 1998).
(a) Civil Procedure Code (V of 1908)---
----0. XLI, R.27---Additional evidence---Production of---Conditions required to be satisfied---Produion of additional evidence aanpellate stage---Parties to appeal were not entitled to adduce any additional evidence---Additional evidence could, however, be allowed if Court from whose decree appeal was preferred, had resed to admit evidence which wasought to be admitted or Appelte Court required any documento be produced or any witness to be examined to enable it to prounce judgment or for any othesubstantial cause under O.XLI, R.27, C.P.C. which was an excepon to principle, that AppellatCourt could not record freshedence.
Muhammad Rizwan v. Abdul Jabbar and others 1999 SCR 187 and Muhammad Hanif v. Mst. Parsan Bibi and others 1996 MLD 1158 ref.
(b) Civil Procedure Code (V of 1908)---
----0. XLI, R.27(b)---Production of additionalvidence---Discretion of Court---Condition for exercise of such discretion---Power to allow additional evidence was discretionary in nature but such power was circumscribed by limitation specified in O.XLI, R.27(b), C.P.C.---Parties could not be allowed to produce fresh evidence in order to patch up the weaker parts of their case or fill up lacunaoto enable them to raise a new point--Inadvertence of parties mistaken legal advice or ignorance of law or negligence of a party, were no grounds for allowg additional evidence--Additional evidence could be allowed only when a party was unable to produce evidence through no faultf its own or where evidence was imperfectly taken by the lower Court---Party which had an oppounity, but elected not to produce evidence, could not be allow to give evidence that could not have been given in the Court below---Court allowing additional evidence must also record reason therein.
Taj Din v. Jumma and 6 others PLD 1978 SC(AJ&K) 131; Abdul Qayyum v. Bashir Ahmed Khan and 4 others 1996 SCR 22; PLD 1958 SC (Ind.) 170 and Bashir Ahmad's case 1985 SCMR 1232 ref
(c) Civil Procedure Code (V of 1908)---
----0. XLI, R.27---Production of additional evidence-Policy of law laid down in O.XLI, R.27, C.P.C. appeared to be not to allow additional evidence to fill up lacunas---Appellate Court could only allow addition evidence if Court itself so felt that judgment could not beonounced without it.
Ch. Muhammad Sharif Tariq, Advocate for Appellant.
Liaquat Ali Khan, Adcate for Respondents Nos. 1 to. 4.
Date of hearing: 20th October 1999.
P L D 2000 Supreme Court (AK) 25
Present: Basharat Ahmad Shaikh
and Muhammad Yunus Surakhvi, JJ
Syed LAL HUSSAIN SHAH---Appellant
versus
Mst. ROBINA SHAHEEN and another--Respondents
Civil Appeal No. 13 of 1999,cided on 22nd November, 1999.
(On appeal from the judgment of the High Court dated 9-10-1998 in Civil Appeal No.23 of 1998).
) Muhammadan Law---
---- Faith or sect---Determination---When a person makes a statement about
his faith, general law is that his statement has to be accepted---Deceased, prior to his death signed an affidavit and made stement on oath that he was a "Sa" and. said affidavit was supported by witnesses who were proced in the Court---Such witnesses had admitted that "Alam" was flying on house of deceased and that deceased used to beat hi'Mest which was a sure sign of being a Shia ---Said witnesses were independent and no reason existed to disbelieve them as corrorating the affidavit of deceased---Mere fact that Janaza prayer of deceased was led by a "Sunni" Imam, an act which was dote after death of deceased without his permission, would not destroy value of evidence led by daught of deceased to prove that .hedeceased father was "Shia". [pp. 29, 30] A & B
(b) Muhammadan Law---
Inheritance---Shia law---Sunni law---Distinction---Doctrine. of return "Radd"---Rule of inheritance ordained in Holy Qur'an was that if a Muslimcd leaving behind one daughter d no other heir, then she woultake half ; of the estate of deceased ---Shia law of inheritance was also same ---Shia law prescribes that if there was no son of deceased and there was only one daughter her share was one-half; if there were two daughtersr more they would inherit 2/3rd and Sunni law was also the same---In Shia law, however, unlike Sunni law, if there was one daughter, she would exclude all other heirs including brothers of the deceased---Said rule was not inconsistent with rules of inherance ordained by Allah in Holy Qur'an---When there was no other heirs, half of the estate of deceased would still be available after giving one-half to the daughter---Doctrine of return "Radd" was not peculiar to the Shias but also a part of the "Sunni" stem of inheritance.
[pp. 30, 31] C & D'
o
Abdul Aziz Chaudhry, Advocate for Appellant. Ch. Yaqoob Javed Batalvi, Advocate for Respondents.
Date of hearing: 25th October, 1999.
P L D 2000 Supreme Court (AJ&K) 31
Present: Sardar Said Muhammad Khan, C. J.
. and Muhammad Yunus Surakhvi, J
MUHAMMAD LATEEF KHAN
' and 2 others---Appellants
versus
MUHAMMAD AFSAR KHAN---Respondent
Civil Appeal No, 17 of 1999, decided on 6th October, 1999.
(On appeal from the judgment of the High Court dated 4-11-1998 in Civil Appeal No. 11 of 1996).
--.-Malicious prosecution---Suit for damages---Necessary for plaintiffs to prove that their prosecution was without any reasonable ground---Mere fact that plaintiffs/accused were acquitted, would not justify to award them compensation for malicious prosecution without proving id fact. [p. 34] A
Jogendra Garabadu and others v. Lingeraj Patra and others AIR 1970 Orissa 91; Jumma Khan v. The State PLD 1982 FSC 207; S.M. Tufail Ahmad v. Willayat Hussain and 2 others993 CLC 1743; Habib Bank Ltd. v. The State and others 1993 SCM1853; Khawaja Muhammad Naseem Shafiqur Rehman 1996 CLC 1460nd Muhammad Akram v. Mst. Farman Bi PLD 1990 SC 28 ref.
SardaRafique Mahmood Khan, Advocateor Appellants.
M. Tabassum Aftab Alvi, Advocate for Respondent.
Date of hearing: 5th October, 1999.
P L D 2000 Supreme Court (AJ&K) 34
Present: Sardar Said Muhammad Khan, C.J.
and Muhammad Yunus Surakhvi, J
MILITARY ESTATE OFFICER, HAZARA CIRCLE, GOVERNMENT OF PAKISTAN, ABBOTTABAD
and others---Appellants
versus
MUHAMMAD BASHIR
and 6 others ---Respondents
Civil Appeals Nos.34 and 35 of19, decided on 26th October, 1999.
(On appeal from the judgment and decree of the High Court dated 13-11-1998 in Civil Appeals Nos. 19 and 20 of 1998).
filed---Validity---Memorandum of appeals filed by appellant before High Court were accompanied by thoppy of award made by District Judge and under S.26(2) of Land Acquisition Act, 1894, award given by District Judge having been deemed to be a "decree", it was not necessary to file copies of decree-sheet with memos. of appeals irrespective of the fact thaa formal decree-sheet was drawn by District Judge---Memorandum of appeals duly accompanied by copy of award made by District Judge, having been properly filed, order of High. Court in dismissing appeals as being incompetent due to non-filing of decree-sheet, was set aside by Supreme Court remanding case to High Court to decide the same afresh after hearing the parties. [pp. 36, 37; .3] A, B, C & D
Narsingh v. Secretary of State AIR 1928 Lah. 263; Nur Din v. Secretary of State AIR 1927 Lah. 49; M. Dodla Malliah and others v. The State of Andh. Pra. AIR 1964 Andh. Pra. 216 and Dilawar Hussain v. The Province of Sind PLD 1953 Kar. 578 ref.
Riaz Tabassum, Advocateor Appellants.
Liaquat Ali Khan, Advocate for Respondents.
-Des of hearing: 25th and 26th October, 1999.
P L D 2000 Supreme Court (AJ&K) 38
Present: Sardar Said Muhammad Khan, C. J.
anMuhammad Yunus Surakhvi, J
TAJ BIBI and 8 others---Appellants
. versus
Syed MATLOOB SHAH an5 others---Respondents
Civil Appeal No. 150 of 1998, decided 18th October, 1999.
(On appeal from the judgment of the Highourt dated 18-6-1998 in Civil Revision No.58 of 1998).
(a) Azad Jammu and Kashmir Right of Prior Purchase Act. 1993
----S. 6---Azad Jammu and Kashmir Interim Constitution Act ('VIII of 1974), Ss.42 & 44---Civil Procedure Code (V of 1908). S.115 & O.VII, R.18--Suit for pre-emption ---Production of documents---Defendants vendees in their written atement raised plea of waiver d led evidence in proof thereof---Plaintiffs in rebuttal sought permission for production of certain documents which was objected to by defendants, and Trial Court upheld the objection, but High Court, exercising its suo motu revisional powers, allowed plaintiffs to produce said documents---Validity---Plea of waiver was
raised by defendants in their written statement and evidenceas led by them on said plea->-aintiffs could have produced relevant documents at time of rebuttal of issue of waiver as no reason existed for plaintiffs to produce said documents alongwith plaint because plea of waiverw raised by defendants in theirritten statement---Trial Court in circumstances, was not justified to refuse production of documents---High Court had rightly lowed production of said documents in exercise of its suo motuevisional
jurisdiction. [pp. 40, 41] A, B&C Messrs Asghar Ali & Bros. v. United Bank Ltd. 1987 CLC 504:
Lakhpat Pathak v. Ghiran Pathak and others AIR 1937 All. 55; Puran Singh
Relu Singh v. Mathra Das AIR 1934 Lah. 126; The Lahore Improvement
Trust v. Sh. Karamat Ali PLD 1959 Lah. 597 and Sh. Allah Ditta v. Ahmed
& Co, PLD 1954 Lah. 608 ref."'
) Civil Procedure Code (V of 1908)---
----S. 115---Suo motu revisional jurisdiction, exercisef---High Court under 5.115, C.P.C. could suo motu correct illegal exercise of jurisdiction by Court below. [p. 42] D
v (c) Azad Jammu and Kashmir Supreme Court Rules, 1978---
®RO. XLIII, Rr. 1 to 5---Inherent jurisdiction of Supreme Court--,Scope--
Supreme Court had inherent powers under O.XLIII, Rr.l of Supreme
Court Rules, 1978 to do completeustice. [p. 42]' E.
Raja Muhammad Hanif Khan, Advocate for Appellants.
Sardar Rafique Mahmood Khan, Advocate for Respondents.
Date of hearing: 14th October, 1999.
P L D 2000 Supreme Court (AJ&K) 43
Present: Basharat Ahmad Shaikh
and Muhammad Yunus Surakhvi, JJ
MUHAMMAD MISKEEN and others---Appellants
versus
AZAD GOVERNMENT OF THE STATE OF JAMMU
AND KASHMIR through Chief Seetary, Muzaffarabad and others---Respondents
Civil Appeals Nos.81 and 82 of 1999, decided on 18th February, 2000..
(On appeal from the judgment of the High Court dated 30-4-1999 in Civil Appeal No.58.of 1997).
Azad Jammu and Kashmir Land Acquisition Act, 1894---
----Ss. 4, 18 & 23---Acquisition of land---Determination of market value--Collector determined market value of acquired land taking into consideration its market value at the timef. publication of notification under S.4, Land Acquisition Act, 1894 and also location and situation of the land---District Judge on reference filed by ownersf acquired land, upheld the market value of land as determined by Collector and rejected reference---High Court, on appeal enhanced market value of land taking into consideration differentses of land adjacent to the land in question---Sales which were kept in view were made after abt two years from publication of notification of the acquired land---Validity---Market value of acquired land on the date of publication of notification under S.4, Land Acquisition Act, 1894 had to be taken into account under S.23 of the said Act---Judgment of High Court enhancing market value of land, was vacated by Supreme Court in appeal and judgnt passed by District Judge,w restored. [pp. 48, 49] A & B
Faiz Akbar Khan and others v. Azad Government and others 1996
SCR 132; Azad Government and 2 others v. Mst. Razia Farooqi anti others
r
1996 SCR 136; Government of Pakistan v. Hamid Akhfar PLD 1988 SC(AJ&K) 6; Comdr. Faiz Ellahi and 3 others v. Multan Improvement Trust, Multan and another 1992 CLC 267; Islamia University, Bahawalpur through its Vice-Chancellor v. Khadim Hussain and 5 others 1990 MLD 2158; Haji Muhammad Yaqoob and another v. Collector, Land Acquisition/Additional Deputy Commissioner, Peshawar 1997 SCMR 1670 and Provincof Punjab through Collector, Bahawalpur and another v. Abdul Majeed and 98 others 1997 SCMR 1692 and Muhammad Sharif and 7 others v. Azad Government and another 1998 CLC 2052 ref.
Syed Mushtaq Hussain Gillani, Advocate for Appellants (in C.A. No.81 of 1999).
Kh. Atta-Ullah, Additional Advocate-General for Respondents (in C.A. No.81 of 199.9).
Kh. Atta-Ullah, Additional Advocate-General for Appellants (in C.A. No.82 of 1999).
Syed Mushtaq Hussain Gillani,' Advocate for Respondents (in C.A No.82 of 1999).
Date of hearing: 6th December, 1999,