Ali Baqar Najafi, J.--This appeal under Section 32 of the National Accountability Bureau Ordinance, 1999 is directed against judgment 06.06.2006 passed by learned Accountability Court No, II, Lahore whereby the appellant was convicted under Sections 9(a) & 10 read with schedule of NAO, 1999 and sentenced to undergo R.I. For four years with fine of RS. 4,64,87,000/- and in case of default of payment, to further undergo R.I. For two years with benefit of Section 382-B, Cr.P.C. He was also declared disqualified for a period of 10 years to be reckoned under the law, he was to forthwith ceased to hold public office, if any, and also stood disqualified for the period of ten years from being elected, chosen, appointed or nominated as member or representative of any public body or any statutory or local authority in service of Pakistan or of any province. The accused was also not allowed to apply for or be granted or allowed any financial facility in the form of any loan or advance or other financial accommodation by any bank or financial institution owned or controlled by the Government, for a period of ten years from today.
2. The allegations contained in Reference No, 34 of 2002 against the appellant is that after when Pasban Cooperative Finance Corporation Society (PCFC) had decided to sell Rahwali Sugar Mills Limited G.T. Road, Gujranwala to Sh. Muhammad Mansoor, co-accused, an MNA and Managing.
Director of PCFC for consideration of Rs, 33,67,3000/-, in the year 1987 and he got the possession of Mill on 29.02.1988 and handed it over to appellant who was appointed its Managing Director. A sale deed was executed on 08.08.1990. On 25.07.1989 they floated a fake/bogus public limited Company in the name of Rahwali Sugar Mills and applied to Pakistan Industrial Credit and Investment Corporation (PICIC) for loan claiming that Rahwali Sugar Mills has sold of the fixed assets of the Sugar Mill to him. During the investigation, conducted by Anti-Corruption Establishment, Lahore, it transpired that Account No, 867 was opened in the name of Rahwali Sugar Mills. In the month of May 1988 and another Account No, 872 in the name of Director Funds Rahwali Sugar Mills was opened on 07.05.1988, in the PCFC Branch, G.T. Road, Gujranwala. Two months later on 06.07.1988 the appellant changed Account No, 872 in his own name and started using in his individual capacity. From May 1988 to 30 March 1992, he continued to operate both the accounts himself during which an amount of Rs, 2,28,31,755/- was received through bank drafts, telegraphic transfers and cash, etc from different cities as sale price of sugar sold by Rahwali Sugar Mills. He partially deposited the amounts in Account No, 867 and deposited the major amount in Account No, 872. On 30.03.1992, it was incorrectly declared that Rahwali Sugar Mills had suffered a loss of Rs, 53,654,624/-. He issued cheques in the name of Haji Siraj ul Haq, a lessee of Zinco Floor Mills, owned by Sh. Muhammad Mansoor, and substantial released huge amounts of cash himself, thereby causing misappropriation of the amount of RS. 2,28,31,755/- causing total loss of Rs, 6,39,28,914/- (including the mark up). On 12.04.1989, co-accused Sh. Muhammad Mansoor and Asif Ali, issued SMRs No, 58593 in the name of appellant for a sum of Rs, 1,00,00,000/- (one crore) and on 07.06.1989 said Sh. Muhammad Mansoor, issued SMRs Nos. 63742 to 63776, in the name of family members of the appellant in the sum of Rs, 1,00,00,000/- (one crore), thereafter appellant fraudulently and deceitfully made payment of these SMRs,
3. Meanwhile, Asif Ali and the appellant offered a plea bargain before filing of reference which was accepted and the plea bargain of Sh. Muhammad Mansoor, was accepted and approved by the Accountability Court in which appellant faced the trial.
4. The prosecution had produced 11 prosecution witnesses and the documentary evidence whereas 2 Court witnesses appeared, each one from prosecution and the defence. After the closure of prosecution evidence, the statement of accused was recorded under Section 342, Cr.P.C. And according to him Sh. Muhammad Mansoor, was the Managing Director of the corporation who ran these projects and admitted that there were 7 other Directors and that the possession of the Mill was handed over to the corporation on 29.02.1988 whereas Mill was sold through registered sale deed (Exh.CW-2/1) dated 08.08.1990 by the Government of Punjab through Managing Director PIDB for a consideration of Rs, 33673000/- in which he stood as a marginal witness. He also alleged to have floated a public limited company named Rahwali Sugar Mills and also admitted that on 15.11.1989, he in the capacity of Director submitted an application for sanction of the loan of 22.7 million rupees to PICIC by mis-statement that sold fixed assets of the Mill has been sold off to M/s PCFC. However, he also admitted that loan facility was allowed by PICIC to the company. He also admitted to have operated Account Nos. 867 and 872 which remained under the control of PCFC.
He admitted to have issued the SMRs, and also admitted that Liquidation Board had sold off the Mill for consideration of Rs, 118000000/- whereas the same was sold to corporation for Rs,33673000/- which deal was approved by the then Co-operative Judge and total liability of Rahwali Sugar Mills came to Rs, 109611051/-.
5. Learned counsel for the appellant contends that neither appellant nor his family ever applied for issuance of SMRs and in fad SMRs were .Prepared by said Muhammad Saeed, Manager PCFC. The appellant was not the beneficiary of said SMRs, Adds that Account Nos. 867 and 872 were not opened in his personal capacity but as representative of PCFC who was the owner of Rahwali Sugar Mills and that whatever he did was under the direction and management of PCFC. Further adds that sale of Mill was made on the basis of order of Cooperative Judge for a consideration of Rs,114611091/- whereas total liability of the Mill was109611091/-, therefore, there was no loss.
6. Conversely, learned ADPGA for NAB contends that admittedly the appellant became the marginal witness of the sale deed dated 08.08.1990 and ,Account Nos. 867 and 872 were opened by the appellant in March 1988, who operated the same since there opening and in fact he acted as Chief Executive. He argues that Rahwali Sugar Mills was not registered as Public Limited Company as there was no title of property vested in the company who was just holding its possession as a proposed vendee.
7. Arguments heard. Record perused.
8. While admitting the sale of Rahwali Sugar Mills for Rs, 33,67,3000/- in favour of PCFC by signing the sale deed as marginal witness and delivery of its possession on 29.02.1988 and operating Account Nos. 867 and 872 as well as withdrawal of slips, the appellant has committed no offence.
Admittedly, the appellant remained a front man under the direct instructions and control of Sh.
Muhammad Mansoor, the co-accused who has entered into a plea bargain. The investigation does not reveal as to what benefit the appellant had drawn out of his status in the company. The losses of the company were not properly based on any Audit Report. Importantly, when the sale of the Mill was approved by Mr. Justice Saeed-uz-Zaman Siddiqui, Hon'ble Judge of Supreme Court, the then Cooperative Judge, for a consideration of Rs, 114611091/- as evident from Exh.D/1, the judgment, and the liability of the Mill was calculated as Rs, 109611091/-, we failed to understand as to what loss was caused to the Mill. It could have been very easy for the complainant to have approached the cooperative Judge for fixation of liability of the appellant. In this case, plea bargain of Sh.
Muhammad Mansoor, has been approved and, therefore, the liability of the appellant does not appear to be based on any solid footing. We have straight away observed that PW-1 in his cross- examination has admitted that Central Registrar Cooperative Societies became Administrator of PCFC from 01.09.1990 to 31.12.1990 and during this period the entry with regard to transfer of amount of Rs, 38638981/- and amount of Rs, 23,16,000/- in Account No, 867 was made on 06.12.1990 at the verbal instruction of Muhammad Saeed, Area Manager. Admittedly, at that time the appellant and Sh. Muhammad Mansoor, was not holding the charge of the society.
9. The original copies of SMRs were not produced as prosecution produced its photocopies as Exh.P-3/1-16 out of which 26 were in the name of appellant. These SMRs at this stage for the purposes of determination of guilt cannot be relied upon for the reason that they are the photocopies and, secondly, the acknowledgment on the back through the signature of the appellant could not be proved by the prosecution either by comparison of signatures or by recording statement of its custodian. Moreover, the question whether the appellant himself was the beneficiary of such transaction is shrouded in mystery.
10. For the above stated reasons me have come to the conclusion that prosecution has failed to discharge its responsibility of proving the case against the appellant beyond any shadow of doubt.
11. In view of the above discussion, we allow this appeal; set aside the impugned judgment of conviction passed by learned Accountability Court No, II, Lahore and the appellant is acquitted of the charges levelled against him. He is on bail and is hereby discharged from the liability of the bail bonds.