' MRS. AYESHA A. MALIK J.---This single judgment decides upon the common issues raised in W.Ps.
Nos.22349 and 22356 of 2013 as both the petitioners have impugned the placement of their names on the Exit Control List (ECL) vide Office Memorandum dated 9-4-2013.
2. The case of the petitioners is that they are directors/shareholders in various corporate entities.
Based on a request by the State Bank of Pakistan (SBP) and United Bank Limited (UBL) their names were placed on the ECL under Section 2 of the Exit from Pakistan (Control) Ordinance, 1981 (1981 Ordinance). In terms of the Office Memorandums, the names of the petitioners were placed on the ECL on account of some outstanding liability of UBL against each of the petitioners.
3. Learned counsel for the petitioners argued that the placement of the names of the petitioners on the ECL is illegal and without any justification. No notice was issued to the Petitioners prior to passing the impugned order. He argued that there is no determination that there is a default of any amount from the petitioners yet on the request of UBL and SBP the respondents have placed the names of the Petitioners on the ECL. Learned counsel argued that inclusion of the names of the petitioners on the ECL, is a violation of the fundamental right of freedom of movement guaranteed under the Constitution of Islamic Republic of Pakistan, 1973 (Constitution). Further argued that the placement of names of the petitioners on the ECL cannot be used for collateral purpose for the recovery of bank dues. Learned counsel argued that the order of placing the names of the petitioners on the ECL is the result of highhandedness and abuse of authority as it is not a case of public interest but simply a case of recovery of amounts claimed by a financial institution. Further argued that mechanism for recovery is provided to financial institution under the Financial Institutions (Recovery of Finances) Ordinance, 2001 (FIO 2001) and as such the respondents cannot use State machinery to coerce the petitioners in paying an amount which may or may not be due against the petitioners. Learned counsel argued that the Writ Petitions are maintainable against the order directing the placement of the names of the petitioners as they are patently illegal.
Further argued that the remedy available under section 2(3) of the 1981 Ordinance is not an adequate remedy. In this regard he has placed reliance on the case titled "Mian Ayaz Anwar v.
Federation of Pakistan through Secretary Interior and 3 others "(PLD 2010 Lahore 230). Respondents.
Admittedly, the names of the petitioners have been placed on the ECL by the Ministry of Interior on the request of State Bank of Pakistan through its letter dated 29-3-2013. Learned DAG has placed copies of both the letters on the file. Learned DAG has relied upon the request made by UBL to the Director Banking Policy and Regulation Department, State Bank of Pakistan. Learned DAG has argued that public interest is always involved in money matters. Further argued that the petitioners are defaulters and should not be allowed to leave the country. While relying on the case titled "Dossani Travels Pvt. Ltd. And 4 others v. Messrs Travels Shop (Pvt.) Ltd. And others" (2013 SCMR 1749), learned DAG states that this is a policy matter and should not be interfered with by the Court.
He has also placed reliance on the case titled "Miss Naheed Khan v. Government of Pakistan and others" (PLD 1997 Karachi 513) wherein it has been held that freedom of a person can be restricted in public interest.
5. Heard the learned counsel for the parties and reviewed the record available on the file.
6. The Office Memorandums dated 9-4-2013 state that the names of the petitioners have been placed on the ECL pursuant to a request made by the State Bank of Pakistan on behalf of UBL dated 29-3-2013. As per the record both the petitioners are obligated to pay some amounts to UBL. Since they have failed to pay, UBL made a request to SBP for placement of names on ECL. Copies of the request letters sent by UBL to the State Bank of Pakistan are available on the file. UBL requested that the names of the petitioners be placed on the ECL for the following reasons:- "Various efforts are being made for the recovery of funding extended to Paramount Spinning Mills Limited by al( the banks/financial institutions and we fear that the main sponsors may leave the country to avoid any legal repercussions. In order to protect the interest of the bank and to exert pressure on the management for a workable solution, we see SBP 's approval to place name of the following Director/Sponsor of Paramount Spinning Mills Limited on the Exit Control List (ECL) under Exit from Pakistan (Control) Ordinance, 1981 on an urgent basis."
' A bare review of the reason provided in the said letters shows IA that the financial institution is using State machinery to exert pressure on the petitioners to repay amounts due to it. Nothing has been appended with the letters to show the default, if any, or to show that the default has been established by a Court of competent jurisdiction. The FIO, 2001 is a special law with exclusive jurisdiction to adjudicate upon disputes between the financial institution and its customer. Where the financial institution is seeking to recover amounts due to it from a customer, the Banking Court after following due process of law adjudicates upon the matter and decide whether or not the customer is in default. Without a clear determination from the Court of competent jurisdiction on the question of default, the State Bank cannot use State machinery for recovery purposes.
7. Rule 2(e) of the Exit from Pakistan (Control) Rules, 2010 (Rules 2010) provides that case of two or more key or main directors of a firm, in default of loan or liabilities exceeding one hundred million rupees. The key word in this Rule is 'default' of loan or liabilities. Admittedly, there is 'no decree against the petitioners with respect to the amount B stated to be due to UBL. The 1981 Ordinance aims to control the exit of certain persons from Pakistan. The Rules provide for the grounds to prohibit persons from proceeding abroad. In the case of petitioner in W.P. No,22349 of 2013 the outstanding liability due against him is stated to be Rs,307.216 million. Similarly in the case of the petitioner in W.P. No,22356 of 2013 the outstanding liability due against him is stated to be Rs,711.141 million. However there is no decree from the Banking Court declaring the petitioners to be in default. Furthermore there is no explanation provided by UBL or SBP as to whether the petitioners are main directors of the company whose loan is due. A review of the record shows that the respondents did not require any information from the SBP or from UBL but simply processed the request of the SBP for placing the names of the petitioners on the ECL with immediate effect. The SBP did not question the request of the UBL and instead mechanically placed the request before the respondents. To the mind of this Court, the reasons given by UBL for the placement of the names of the petitioners on the ECL are not legal. A review of the request shows that they.Clearly want to put pressure on the petitioner's for 'workable solution'. State machinery cannot be used for the purposes of extorting pressure'. Furthermore State machinery cannot be used for the purposes of a private dispute unless government interest is at stake. This is clearly provided in Rule 2(2)(a) of the Rules 2010 that persons involved in private disputes where government interest is not at stake, except cases of fraud against foreign banks and reputable companies with significant foreign investments. In the case cited at "Munir Ahmad Bhatti v. Government of Pakistan, Ministry of Interior through Secretary and others" (PLD 2010 Lahore 697) it was held that the respondents should keep in mind public interest that is the interest of the country being a common interest and not just for the interest of an individual before placing the name of citizen on the ECL. In the case of cited at "Hassan Raza through Lawfully Constituted Attorney v. Federation of Pakistan through Secretary Ministry of Interior, Islamabad and 2 others" (2012 CLD 92), it was held that ECL Rules 2010 are not applicable in the case where person is involved in a private dispute unless government interest is at stake or where person is involved in fraud against foreign banks and reputable companies with significant foreign investment or if it is shown that person involved in heinous crime or in drug trafficking. In the case cited at "Wasatullah Jaffery v. Ministry of Interior through Secretary, Federal Government of Pakistan and 4 others" (PLD 2014 Sindh 28) it was held that where a Ministry of Interior has placed the. Name of a person on the ECL in a mechanical manner without applying its mind, without passing a speaking order and without disclosing the basis of its intention of exercising power under section 2(3) of the 1981 Ordinance, then such action on the part of the Ministry of Interior was unfair, unreasonable; not in a good faith and in violation of a fundamental right.
8. Therefore in terms of the law laid down the names of the petitioners have been placed on the ECL without application of mind, in a mechanical manner and without considering the element of public interest by the respondents. The petitioners have been denied their fundamental right without due process of law.
9.. In view of the aforesaid, these Petitions are allowed. The request of the UBL through letter dated 13-2-2013 is set aside and the name of the petitioners be removed from the ECL forthwith.