FAUJI FOUNDATION AND ANOTHER vs SHAMIMUR REHMAN

' MUHAMMAD HALEEM, ACTG. C. J.-This appeal, both certificated as well as by leave, arises from the judgment of the High Court of Sind, Karachi, dated 9th of April, 1980. By which Constitutional Petition No. 863 of 1973 was accepted.

2. This appeal involves intricate and interwoven facts which have surfaced in the pleadings of the parties in these proceedings which, by and large, were not pleaded in such depth and details before the High Court ; and while placing them before this Court, the parties have, to a large extent, interpreted them differently as to their content and effect. I would venture only to sift and refer to them wherever it is considered necessary for the purpose of this judgment. The case of the appellant, as unfolded before this Court, is as under.

3. The starting point of the incorporation of the Rehmania Fauji Sugar Mills Ltd. (hereinafter called "the Company" or. "the Mill") was a visit of the Chairman, Agricultural Development Corporation, in January, 1968, to Tando Bago, Sind, where the settlers were ex-servicemen and the main crop was sugar-cane which was going waste without any sugar mill within a reasonable distance which could consume their sugar-cane crop. They, therefore, represented to him for installing a sugar mill in "Khoski area" for the consumption of their crop which would, in terms of financial gains, improve their lot. The Chairman, accordingly, wrote to the Adjutant-General, Pakistan Army, for considering the feasibility for the installation of a sugar mill by the Fauji Foundation, herein the appellant, which had already set up a sugar mill in Tando Muhammad Khan and hence possessed necessary experience and expertise ; but as would appear from the note of the Adjutant-General dated 31st of December, 1968, the Fauji Foundation, could not finance this project as it was fully committed to other major projects. Therefore, the Commander-in-Chief, Pakistan Army, by ins letter dated 6th of January, 1969, addressed to the Governor, West Pakistan., while incorporating this fact, sought his assistance for arrang-iug some reliable party to install a sugar-mill at Khoski which project was eminently for the welfare of the settlers who were the ex-servicemen.

4. It seems that Saminnur Rehman, the respondent herein, on coining to know of the interest of the G. H Q. In the establishment of a sugar millat Khoski, on account of intimate terms of his father, Inamur Rehman, with senior officers of the Army, On 16th of December, 1968; submitted an application to the Adjutant-General, Pakistan Army, addressed to the Governor and sought permission to establish a sugar mill at Badin, with the assistance and help of G., H. Q. And the Government, which apparently was also sent along with the letter of the Commander-in-Chief, Pakistan Army. Necessary permission was accorded by the Governor, pursuant to which the Government of West Pakistan requested the P. I. C. I. C. By letter dated 3rd of March, 1969, to extend to Rehmania Sugar Mills Ltd. The facilities for setting up the Mill. However, on the declaration of Martial Law on 25th of March, 1969, the Central Government froze all such permissions. By letter dated 24th of May, 1969, the-respondent invited the attention of the Adjutant-General, Pakistan Army, that as the venture was for the benefit of the ex-servicemen, who were the cane-growers, steps be taken to seek restoration of the permission. Accordingly, the General Headquarters moved for 'the revival of the permission which request was granted by the Central Government and the "freeze order" was withdrawn..

5. The Adjutant-General, Pakistan Army, thereafter, was informed by the Secretary, Ministry of Industries, by letter dated 16th of August, 1969, that P. I. C. I. C. Was free to deal with the applications for industrial credit on merits and that it should be approached direct.

6. In view of the paucity of funds, it transpires that the respondent, through the influence of his father with senior officers in the G. H. Q. Sought for a loan from the welfare and Rehabilitation Funds of the G. H. Q. For setting up the proposed mill. The financial assistance received by the respondent and his family members from the Directorate of Welfare and Rehabilitation (D. W. R.) was as under

(a) Grant of loan of Rs. 90 lacs to the respondent and his mother (Begum Shamim Khatoon) with interest at the rate of 10% per annum.

(b) Advance of a sum of Rs. 40 lacs in exchange for the debentures which were to be issued to D.

W. R. By the mill, with interest at the rate of 9i% per annum during the interregnum.

(c) Investment by D. W. R. In shares of the value of Rs. 25 lacs in the mill with an interest at the rate of 6% per annum till the shares were issued.

7. The Adjutant-General's letter dated 30th of August, 1969, addressed to the Chairman of the mill brings out the terms and conditions of loan as under :- "1. Since the Sugar Mill is primarily being established at Taluka Badin for the benefit of ex- servicemen resettled in that area and the permit is being granted due to the efforts of this H. Q. The following terms be accepted and a suitable Agreement executed in this respect :-

(a) A fixed percentage of shares be offered to or settlers of Ghulam Muhammad Barrage.

(b) Most of the jobs should go to ex-servicemen of requisite qualifications.

(c) The Director of Welfare and Rehabilitation should be one of the Directors of the Board of Management.

(d) W & R. Dte have invested more than Rs. 1 crore with Standard Bank Ltd. In Fixed Deposit earning 6i% to 71% interest per annum. The Mill should give 10 % interest if we give them some amount on loan for a period of 10 years. This amount of loan will be given on sure guarantee.

(e) The Mill should contribute 5% of the annual net profit of the Sugar Mill to G. H. Q. Welfare Funds.

2. Please intimate acceptance of the above terms to this H. Q. At an early date."

' The letter highlighted a fixed percentage of shares to be offered to the settlers, the advance of loan of Rs. 90 lacs to be protected by a "sure guarantee" and the rendering of 10% interest on this amount for a period of 10 years ; and finally, a contribution of 5% of the annual net profits to the G.

H. Q. Welfare Funds. Further, the tenor of the letter also showed that the agreement was to be executed between the Adjutant-General's Branch -D. W. R. And the Mill. The attempt to emphasise these terms was solely for the object to show that none of the essential terms were adhered to, as offered, in the final agreement. This letter was followed by the letter of the Chairman of the mill dated 2nd of September, 1969, wherein objections were taken not only to the allocation of fixed percentage of shares to a preferred class of shareholders, namely, the cane-growers but also to the high rate of interest and the starting point of its accrual which, it was asserted, should commence only after the proposed mill goes into production ; and as for the contribution of 5% of the net profits to the G. H. Q. Welfare Funds, it was not objected to but a doubt was expressed as to its feasibility. In the end it was stated that subject to the foregoing objections, the contents of the reply should be taken to be the broad principles of the agreement between the parties.

8. This was not all as some other deviations were communicated by the Chairman of the Mill in his letter dated 5th of September, 1969, in which a reference was made to the Adjutant-General's letter of the same date which, however, is not traceable. It was assured that the Standard Bank Ltd., Karachi, would furnish the guarantee in favour of the Adjutant-General as representing D. W. R. In terms that the "borrowers shall pledge with D. W. R. Fully paid-up shares of the proposed company of the face value of Rs. 1 crore as against the intended loan of Rs. 90 lacs and until such pledge is made, the Bank will guarantee the repayment of the loan or its return in the event of the project being, for any reason, abandoned ;" and such pledge should be "understood" to be made at the time of the allotment of the shares. Further, as condition of the consent of issuing the guarantee, the Bank required the amount of loan to be deposited in the account of the sponsoring Directors, namely, Shamimur Rehman and his mother, Shamim Khatoon, to be opened with it. It was next given out that the sponsoring Directors were willing to pay interest on the loan at the rate of 5% per annum as a special gesture from the date the funds were placed at their disposal which would be the ruling rate till the mill goes into production whereafter interest would be paid at the rate of 10% per annum. A pro forma of the guarantee to be executed by the Bank was also forwarded alongwith this letter.

9. The Adjutant-General, by his letter dated 8th of September, 1969, informed the Chairman of the Mill that a loan of Rs. 90 lacs had been sanctioned for a period of 10 years in favour of the sponsoring Directors for investment in the Mill against the interim Bank guarantee till the issuance of the fully paid-up shares of the company to the extent of Rs. 1 crore. It was further averred in it that the Bank should also guarantee the loss in the case of diminution in the face value of the shares and that the interest chargeable would be 64% per annum till the mill goes into production.

A request was further made to furnish the guarantee so that the sanctioned loan could be made available. Despite the fact that from the fixed deposit of the D. W. R. The loan amounting to Rs. 90 lacs was transferred to the account of the sponsoring Directors on 8th of September, 1969, no Bank guarantee was made available. Only an unsigned guarantee of the Standard Insurance Company, bearing the date as 21st of July, 1970, in print, was substituted. In terms, this guarantee recited that the sponsoring Directors shall pledge with the D. W. R., G. H. Q., Rawalpindi, fully paid-up shares of the company of the face value of Rs. I crore by 15th of July, 1971, by way of security for the loan. No condition was, however, stipulated therein for indemnifying the D. W. R. If there was any diminution in the face value of the shares despite the fact that such condition was stipulated in the letter dated 8th of September, 1969. This guarantee remained in force till 15th of August, 1971, but was not renewed thereafter with the result that the D. W. R. Had neither the security of any guarantee nor did it have possession of the shares agreed to be pledged with it. The pledge referred to in the agreement was also not in effect a pledge as the D. W. R. Did not receive the pledged property.

Instead the shares were required to be kept with the Standard Bank Ltd. An institution fully and completely under the control of Mr. Inamur Rehman Alvi, the father of the respondent.

10. It was next alleged that apart from its legal efficacy, this guarantee was neither visualized nor could it be regarded as the "sure guarantee" as envisaged in favour of the D. W. R. And that such pledge could not also be regarded as a guarantee much less adequate guarantee as contemplated. There was also no letter either from the Mill or the Standard Bank Ltd. To show that the shares had been deposited with the Bank. There was, therefore, no security for the loan of Rs. 90 lacs.

11. Another salient feature was the execution of the loan agreement dated 21st of January, 1970, much after the transfer of the loan amount to the sponsoring Directors and that too without The aforementioned guarantee.

12. Further, there was a deviation as regards the parties, in that, instead of the mill, it was executed between the sponsoring Directors and the D. W. R., G. H. Q., Rawalpindi. The terms and conditions of the agreement are as under :- "1. The loan of Rs. 90,00,000 (Rupees ninety lacs only) advanced by the Lenders to the Borrowers is to be repaid either in lump sum at the end of 10 years period from the date of advance or the Borrowers may pay in such instalments as the Borrowers may fix before the expiry of the ten years period aforesaid. The rate of interest on the loan is agreed at 6% per annum from the date of advance till the said Sugar Mill goes into commercial production and thereafter the rate of interest at 10% per annum till full repayment thereof.

2. The Borrowers have furnished a Bank Guarantee in favour of the Lende s guaranteeing the pledging of fully paid-up shares of the said Company by the Borrowers of the value of Rs.

1,00,00,000 (Rupees one crore only). The pledging will be done in the manner that the Borrowers shall deliver and put into the custody of Standard Bank Ltd. The shares of the said Company of face value of Rupees One Crore to be held by the said Standard Bank Ltd. For the Lenders.

3. The Lenders have deposited the sum of Rs. 90,00,000 (Rupees ninety lacs only) (agreed to be) advanced as loan in an account of the Borrowers to be maintained with Standard Bank Ltd., Karachi.

4. The Borrowers undertake and agree that as soon as the said Company proceeds to an allotment of its shares, to pledge in the manner provided in clause 2 of its agreement fully paid-up shares of the said Company of the face value of Rs. One Crore.

5. Notwithstanding anything to the contrary contained in clause I of this agreement, the Lenders agree that in the event of the Borrowers being unable to repay the loan at the end of the ten years period, the Lenders shall extend the period of repayment by further three years period and further hereby agree that the Lenders cannot exercise their right of sale of the pledged shares until and unless the grace period of three years expires and no payment is made of the loan or in case of instalments the Lenders can exercise their right of sale of the pledged shares after expiry of the three years grace period to the extent necessary to realise adjustment of the balance of the loan amount."

' It is worth noticing in the agreement that instead of pledging the fully paid-up shares of the company with the D. W. R. There was a stipulation for pledging them with the Standard Bank Ltd. To be held by it for the D. W. R. Although the postulated interest was 61% per annum yet it was stated to be 6 % per annum in the agreement at the behest of the sponsoring Directors. Further, no provision was made in it for the contribution of 5% of the net profits to the G. H. Q. Welfare Funds.

13. The Rehmania Sugar Mills Ltd. Was renamed as Rehmania Fauji Sugar Mills Ltd. Because of the sponsoring of the Mill by the D. W. R. As a welfare project and it was incorporated as a private limited company on or about 21st of October, 1969, and as the D. W. R. Was a participant in the equity capital of the company, hence the P. I. C. I. C. Increased the :crushing capacity from 1,500 tons to 3,500 tons per day.

14. According to the Articles of Association of the Mill, the authorised capital was Rs. 5 crores, issued capital Rs.

2.5 crores and paid-up capital Rs.

1.25 crores as on 30th of December, 1971. The sponsoring Directors and their family members did not invest any money in the project as stated in their letter noted 5th of September, 1969, but acquired a shareholding of Rs. 82 lacs from the loan of Rs. 90 lacs. Thus, on 30th of December, 1971, the position of shareholding in the company was as follows :- {{TABLE}} ShareholderNo. .of shares Amount Rs.Rs.

Mr. Shamimur Rehman2,60,00026,00,000 Mst. Shamim Khatoon2,00,00020,00,000 Miss Rukhsana Rehman2,60,00026,00,000 Mr. Inamur Rehman1,00,00010,00,000 8,20,00082,00,000 ' Rupees 8 lacs left over were diverted to A. R. K. Industrial Managements Ltd. Which was a family concern of the sponsoring Directors which acquired a shareholding from this amount as well as from the clean loan drawn from the account of the Army Group Savings Scheme run by the Standard Bank Ltd. Thus, the position of shareholding in the mill was :- (0 Respondent, his father, his mother, his sister and their own private limited company, A. R. K.

' Industrial Managements Ltd. (the Managing Agents of Rehmania Fauji Sugar Mills Ltd.) Rs.

1,00,00,000

(ii) D. W. R. Of the G. H. Q. 25,00,000 ' Accordingly, the entire paid-up capital of Rs.

1.25 crores was drawn from the loan of the G. H. Q. Welfare Funds.

15. The other persons who benefited from the shareholding, acquired through the loan funds, had no agreement either to pledge those shares or to deposit them with the Bank.

16, Besides, the aforementioned financial facilities received by the respondent and his family members, the G. H. Q. Was persuaded to undertake the following further financial commitments on behalf of the mill :- "(a) A firm commitment given to P. I. C. I. C. By D. W. R. As one of the Directors of Rehmania Fauji Sugar Mills for an advance of loan to the Company to the extent of Rs. 50 lacs to meet the local costs of the project.

(b) An undertaking given by the D. W. R. To P. I. C. I. C. That the G. H. Q. Will subscribe for shares to the extent of Rs. 50 lacs on public issue, subject to the consent of the Controller of Capital Issues.

(c) An undertaking given by D. W. R. To P. I. C. I. C. That D. W. R. Will subscribe fully to the shares that may be issued to the cane-growers but may remain unsubscribed for by them up to the limit of Rs.

10 lacs, subject to the consent of the Controller of Capital Issues. These submissions came out clearly in the letter dated 6th of April, 1970, from R. F. S. M. To D. W. R. And in the letter dated 5th February, 1970, by A. G. To P. I. C. I. C.

(d) In addition, the D. W. R; and the G. H. Q. Further helped and assisted R. F. S. M. To obtain the bringing loans from Pakistan Industrial Credit and Investment Corporation Ltd. (P. I. C. I. C.) in the sum of Rs. 50 lacs and from Industrial Development Bank of Pakistan (I. D. B. P.) in the sum of Rs. 75 lacs. The D. W. R. Of G. H. Q. Also assisted the R. F. S. M. In persuading the National Investment Trust to subscribe for debentures in the sum of Rs. 10 lacs and the Investment Corporation of Pakistan in the sum of Rs. 25 lacs. The D. W. R. Of G. H. Q. Also helped the R. F. S. M. To obtain foreign credits as follows :- {{TABLE}}

(i) Suppliers credit by Messrs A. W. Smith & Co.

Ltd. ...2050 000

(ii) National & Grindlays Bank through its London Office 200 000

(iii) P. I. C. I. C.... 60 000 Thus, in addition to cash advance of Rs. 155 lacs (by way of loan to respondent and his mother, advance for debentures and investment in shares) the G. H. Q. Was made to enter into further written and binding commitments and obligations to render financial assistance to R. F. S. M.

And/or to spend sums of money up to Rs. 110 lacs. The financial burden placed on the G. H. Q., therefore, came to a total of Rs. 265 lacs."

17. In this connection it was averred that certain commitments were made in a joint meeting between Mr. H. U. Beg and the Adjutant-General, Pakistan Army, held on 30th of May, 1970, to, discuss the capital and management structure of the mill which was also attended by Mr. Inamur Rahman but not fulfilled. Mr. H. U. Beg, Controller of Capital Issues, suggested that out of the promoters' share of equity capital participation of Rs. 1,25,00,000, Rs. 75 lacs should be contributed by the D. W. R. And the balance of Rs. 50 lacs by the other promoters. He was informed by the Adjutant-General that regardless of the quantum of the equity capital participation of the D. W. R.

The company would donate 5% of its net profits to the G. H. Q. Welfare Funds and that the Army was not interested in majority ownership of the shareholding apart from the equity capital ; and that, according to the existing understanding, the D. W. R. Will contribute Rs. 60 lacs in the shareholding leaving the balance of Rs. 65 lacs to the other promoters for their shareholding. Mr. H. U. Beg was further informed by Mr. Inamur Rehman that the company would be managed by a Managing Agency which would be a private limited company, with a Director from the D. W. R. The promoters did not agree with Mr. H. U. Beg's proposal that the management of the mill should be by a Managing Director instead of a "Managing Agency".

18. Here two paragraphs need to be highlighted in the letter of the Adjutant-General addressed to the Minister of Finance, in reply to the minutes of the meeting dated 30th of May, 1970 :- "As a good gesture the Mill agreed to contribute to the welfare funds of the Army to the extent of 5% of their profit, which has been appreciated by the C-in-C.

In the light of the foregoing it may be concluded that the welfare fund and settlers would invest more than Rs. 50 lacs in the form of shares and thereby maintain a directorship to primarily look after the interest of the welfare fund and the settlers. It may also be appreciated that apart from Rs.

50 lacs from or funds, the usual 20% holding of N. I. T. (Rs. 50 lacs) would in any case amount to greater number of shares than the shares held by the other Directors. We therefore, consider ourselves quite secure from all angles."

' It is noteworthy that in this statement as well, there was a misstatement for neither there was any provision in the agreement dated 21st of June, 1970 for the contribution of 5% of the net profits to the G. H. Q. Welfare Funds nor any factual basis for the usual 20% holding of N. I. T. (Rs. 50,00,000).

The proposal of Mr. H. U. Beg, namely, that the D. W. R. Should have major share in the promoters part of the share capital and to have both management and ownership control of the Mill was not accepted for reasons which remained unexplained.

18. By letter dated 25th of January, 1971, of the sponsoring Directors, it was communicated to the Adjutant-General (A. G.'s Branch), D. W. R., that the Board of Directors of the Mill had appointed A. R.

K. Industrial Managements Ltd., as their Managing Agent, on a remuneration of 5% of the annual net profits, for a period of 10 years in accordance with the terms prescribed by the Controller of Capital Issues and in view of this appointment they expressed a desire that the loan of Rs. 90 lacs be transferred to A. R. K. Industrial Managements Ltd., which would execute a similar agreement. This proposal was examined by Colonel Sher Khan of the D. W. R. And his note of 6th of March, 1974 showed that he had Picked out flaws in the existing agreement and suggested their rectification before any new agreement was executed. It further appears that the agreement of the Managing Agency was not executed by the Board of Directors but by the sponsoring Directors and no representative of the D. W. R. Was nominated as a Director of the A. R. K. Industrial Managements Ltd.

20. It transpires from the inspection report of the State Bank of Pakistan that from the Army Group Savings Scheme, floated by the Standard Bank Ltd., Rs. 58,11,446 was loaned to Messrs A. R. K.

Industrial Managements Ltd., a family concern of Mr. Inamur Rehman, on verbal instructions of the Managing Director of the Bank in violation of credit restrictions.

21. The other facilities such as the acquisition of the land at the site and at Karachi, and a direct telephone line through the Air Force Base were also provided by the Government. Additionally, the G. H. Q. Further obtained a recommendation from the Government of West Pakistan for advancing a foreign currency loan of 16,79,369 (Rs. 243 lacs approximately) by P.

1. C. I. C. Again, the Adjutant-General, by his letter dated 9th of June, 1970, asked for a tax holiday for six years, which was allowed by Notification No. S. R.

0. 134(1)71, dated 23-4-1971.

22. Mr. Inamur Rehman was one of the negotiators for the purchase of the machinery with the sanctioned crushing capacity day. As a result of striking the bargain of 3500 tons per with Messrs A.

W. Smith & Co. Ltd., for the supply of the said machinery, Mr. Inamur Rehman demanded a commission equivalent to 10% of the F.

0. B. Price, that is, 19,95,902. To secure the payment of the commission, Mr. Inamur Rehman demanded the deposit of this amount on commercial basis in the name of the Company with the Pakistan Overseas Standard Bank, London. Accordingly, an account was opened with an initial deposit of 1,99,590.4.0 on 30th of December, 1969. This amount was finally adjusted against the payment of 10% commission demanded by Mr. Inamur Rehman as a representative of the Mill.

Thereafter, Mr. Inamur Rehman filed an action in the Queen's Bench Division (Commercial Court) on the basis of an oral commitment, for the recovery of the commission to establish that he had not till then received the commission, but it was subsequently withdrawn as the commitment stood fulfilled.

23. The appellant claimed that the debentures were never actually delivered to the D. W. R. On the other hand, there was default in the payment of interest also on these debentures on the part of the mill. Likewise, there was a default in the payment of interest on the loan of Rs. 90 lacs and so also on the sum of Rs. 25 lacs paid in advance for the price of the shares. Between 14th of January, 1971 and 26th of October, 1971, several letters were written to the Mill and the borrowers under the loan agreement of 21st of January, 1970 to make payment of the interest due on the loan of Rs. 90 lacs, the debentures advance of Rs. 40 lacs and the advance price of shares amounting to Rs. 25 lacs. Thus, on the total amount of Rs. 155 lacs, an interest in the sum of Rs. 20,58,959 had accrued and was payable to G. H. Q. Up to 31st of December, 1971. Instead the G. H. Q. Only received a sum of Rs. 5,40,000.

24. Finally, in the aforementioned background, the facts which led to the promulgation of Martial Law Regulation No. 103 and President's Order 22 of 1972, as recorded by.Major-Genergl Muhammad Nawaz Malik Managing Director of Fauji Foundation, on 21st of December, 1971 and 24th of December, 1971, were as under :- "(1) Army have invested large sums of money from their welfare funds in a number of unsound industrial projects. It is necessary that immediate steps may be taken to ensure safety of these investments.

(2) Firstly, Army have invested approximately Rs.

1.55 crores in the form of loans, debentures etc. In the Rehmania Fauji Sugar Mills which is being managed by the family of Mr. Inamur Rehman of Standard Bank. According to or information the loan agreement is extremely faulty and there is a grave danger of losing this money. The loans have been advanced to the wife and son of Mr. Inamur Rehman for investment in this project and no adequate guarantees have been obtained. As Army does not hold any controlling shares in this project, they have no say in the management of this Project. Immediate steps are required to be taken to ensure the safe return of these funds before the Martial Law is lifted.

(3) Secondly, as you know large sums of Army's money has been deposited in the Standard Bank.

The financial position of this Bank is not highly reliable. Necessary steps have to be taken in co- operation with the State Bank to ensure the safety of these funds.

(4) Besides the above, some money has also been invested in a few other projects, whose viability is doubtful. I will like to briefly discuss possible measures to safeguard Army's interest as soon as convenient to the C-in-C."

AND "(1) The Directorate of Welfare and Rehabilitation G. H. Q. Has invested a sum of Rs. 155 lacs to the Rehmania Fauji Sugar Mills, a public limited company, in the following manner : {{TABLE}} Rs.

(i) Advanced as loan to Mr. Shamiinur Rehman and Shamim Khatoon, the Directors of the Co . 90 lacs

(ii) Advanced against issue of shares of Rehmania Fauji Sugar Mills Ltd. in the name of G. H. Q (shares have been received) 25 lacs

(iii) Advanced against Debentures of the Rehmania Fauji Sugar Mills Ltd. to be issued to G. H. Q. not so far issued 40 lacs Total 155 lacs

(2) Since the loan of Rs. 90 lacs mentioned in sub-clause (i) above is not adequately secured and debentures of value of Rs. 40 lacs mentioned in sub-clause (iii) above also have not been issued yet and since this advance is also not adequately secured, G. H. Q. May be confronted with serious difficulties in recovering this large amount of Rs. 130 lacs.

(3) It is proposed that-

(a) shares of the Company owned by Mr. Inamur Rehman and his family of the face value of Rs. 82 lacs and the shares held by the ' A. R. K. Industrial Managements (the Managing Agent of the Company) to the extent of 8 lacs be transferred and registered in the name of D. W. R., G. H. Q.

(b) The debentures of the value of Rs. 40 lacs be issued and registered in the name of the D. W. R., G. H. Q.

(4) Alternatively, the Fauji Rehmania Sugar Mills Ltd. Should be wound up as a limited company and all its assets and liabilities sold and transferred on reasonable terms to the Fauji Foundation who shall then discharge all liabilities including the above and run the Mill as their proprietary concern. The Fauji Foundation is prepared to accept this arrangement.

(5) The whole case and the above proposals were presented to the President in his office on 23rd December, 1971, in a meeting attended by the Minister for Presidential Affairs, the Defence Adviser, the Finance Secretary, the Managing Director, Fauji Foundation and the Director Welfare and Rehabilitation G. H. Q. Since the Army investment amounted to Rs. 155 lacs in this project which has issued and paid-up capital of 125 lacs only, the President decided in favour of the proposal in 'A' above.

(6) It is requested that a Martial Law Regulation may be issued to give effect to this decision."

Consequently, the whole matter was placed before the then Chief Martial Law Administrator and President and was examined in his office on 23rd of December, 1971 in a meeting attended by the Minister for Presidential Affairs, Defence Adviser, Finance Secretary, D. W. R., G. H. Q., and the Managing Director of Fauji Foundation. A decision was taken by the Chief Martial Law Administrator and President that the Mill be wound up as a limited company and all its assets and liabilities to be "sold and transferred on reasonable terms" to Fauji Foundation which should then discharge all liabilities including the above and run the mill as its proprietary concern. The reasons for this decision, amongst others, were- "(i) the whole sugar mill at Khoski had come into existence with the money of the G. H. Q ;

(ii) moneys had been diverted from the welfare funds of the G. H. Q. To the sugar mill at Khoski ;

(iii) Fauji Foundation is a Charitable Trust created entirely to serve servicemen and ex-servicemen and, therefore, it was considered but proper that this Foundation should take charge of the project in the interest of the servicemen and ex-servicemen."

In this context Martial Law Regulation No. 103 was promulgated by which the mill was dissolved and its assets, liabilities and obligations were transferred to the appellant and later President's Order No. 22 of 1972 was issued to provide compensation to the shareholders.

25. On taking over the Mill, the first appellant paid off the liabilities of the G. H. Q. As under :- {{TABLE}} Rs. ;(a) Refund and repayment to G: H. Q. of the loan amount due from the jespoiidettt and his mother (Shamim Khatoon)---.90,00,OQQ Rs.

(b) Payment of interest on the above loan to G. H. Q. 8,03,077

(c) Payment of amount of debentures subscribed for by G. H. Q.... 40,00,000

(d) Payment of interest to G. H. Q. on the debentures 6,30,800

(e) Payment to G. H. Q. of interest on its share- holding of Rs. 20 lacs from 25-5-1970 to 15-12-1970 @ 6 % 84,247

(f) Payment of compensation to G. H. Q. for its share- holding of Rs.25 lacs at Rs. 8.69 per share of Rs. 10.00 each 21,72,500 ,.1,66,90,624 Apart from this, the appellant also discharged the following liabilities incurred by the mill during the time it was managed by the respondent and his family members :- {{TABLE}} "(i) Foreign Currency Loan (Secured) :,

(a) Grindlays Bank, London166.060

(b) P. I. C. I. C.1,259,097

(c) I. D. B. P.184,576

(ii) Foreign Currency Loan (Unsecured) P. I. C. I. C.12,351 1,622,'084

(iii) Local Currency- -Temporary Loan (Secured)

Rs.

(a) P. I. C. I: C.

4,604,000 (b), I. D. B. P.7,500,000 C/O12,104,000

(iv) Unsecured. Loan: Deferred Custom duty and sales tax3,210,239

(v) Advances for issue of debentures

(a) N. I. T.1,000,000 (b1 I. C. P. .. 2,500,000

26. The compensation as determined and payable under the President's Order No. 22 of 1972 to the respondent, his mother, family members and 4. R. K. Industrial Managementatd., was adjusted against the loan of the D. W. R. Outstanding against them. The respondent in his letter dated 21st of June, 1972, merely objected to the amount of compensation as having been determined at a low figure, that is, instead of Rs. 10 per share it was Rs.

8.69. Lastly, it was stated that neither the respondent nor his mother nor his other family members invested a single pie in the sugar-mill project at Khoski. The whole project was established and financed through the Welfare Funds of the G. H. Q. Which also gave material assistance and financial commitments and undertook obligations set out elsewhere in the judgment. Eminently, therefore, it was a project of G. H. Q. And no financial stakes of 'the respondent or his other family members or the A. R. K. Industrial Managements Ltd., were involved. Nonetheless, eight suits were filed against the appellant which are pending on the original side of the High Court of Sind for the recovery of Rs. 67,49,483.03.

27. Aggrieved by the promulgation of Martial Law Regulation No. 103 and President's Order No. 22 of 1972, the respondent filed Constitutional Petition in the High Court of Sind on 11th of August, 1973, to challenge the validity and competencr of the legal instruments and the actions taken thereunder.

It was pleaded that the initial participants in the equity of the Company were the two groups of shareholders, namely, "Rehmania Group" consisting of family members, friends and associates and the "Army Welfare and Rehabilitation Directorate". The Mill was incorporated in 1969 by the respondent and his mother with an initial paid.. Up capital of Rs. 2,50,00,000 out of which Rs.

1,25,00,000 was subscribed by these two groups in the proportion of Rs. 1,00,00,000 and Rs.

25,00,000 respectively. The balance amount of Rs. 1,25,00,000 was to be subscribed by the public and financing institutions on the issuance of invitation for public subscription. It was further stated that the "General Headquarters of the Pakistan Army" invested Rs. 40 lacs in redeemable debentures issued by the Company in respect of which mortgage deed was registered with the Registrar of Assurances and the title of the mortgaged property had passed to the benefit of the debenture holders before the promulgation of Martial Law Regulation No.

103. Reference 'in the petition was also made to an agreement executed between the D. W. R. And the promoters of the Company, namely, the respondents, in existing terms of which Rs. 90 lacs was advanced to the promoters of the Company specifically for investment in the project and till such time as the Mill went into production interest at the rate of 6% per annum was payable to the D. W.

R. And thereafter at the agreed rate of 10% per annum. Addi- tionally, the D. W. R. Was also entitled to 5% of the net profits of the company.

28. It was specifically stated that the loan was secured initially through a bank guarantee but subsequently, at the. Suggestion of the D. W. R., it was substituted by an insurance company guarantee. Finally, the loan was repayable within a period of 10 years. Further, it was ascribed in the petition that at no time before the promulgation of Martial Law Regulation No. 103, any objection was taken by the D. W. R. Either as "equity _holders" or as "debenture-holders" or as "creditors" of the company.

27. The ground of mala fides against the father of the respondent and his family members was taken through an amendment application No. Miscellaneous 1637 of 1977, filed on 31st of November, 1977, which was allowed on 28th of February, 1978 subject to all just exceptions. Those allegations are contained in paragraph 5-A of the amended petition which are summarised as under :- "(1) That the father of the respondent was approached by late Z. A. Bhutto in 1970 to donate a large sum to the People's Party for use in its elections campaign but as he failed to comply with this request, late Z. A . Bhutto, in an election meeting addressed by him in Badin, had threatened that he would see to it that he would not retain the sugar mill if the People's Party came into power.

(2) That soon after late Z. A. Bhutto took over as President and C. M. L. A. In 1971, he bracketed him with all those officers of the Armed Forces whom he intended to humiliate and remove them from their positions. Accordingly, on 23rd of December, 1971 he was placed under house arrest together with these officers of the Armed Forces and the taking over of the mill was a punishment meted out to him.

(3) That the reasons later advanced for the dissolution of the Mill and for its transfer to the appellant, were illusory "on the face of it" and smacked of mala fides and bad faith as the respondent's father, who was the Managing. Director of a "First Class Scheduled Bank" with controlling interest in the bank's shareholding, could have raised large funds on easy terms with banks and other financial institutions for investing it in the shareholding of the mill ; and further, if the respondent's father had wielded tremendous influence with the "top brass" of the Army, the then Head of the State, could have directed any anancial institution to make available the funds to the promoters for investment which was not done but it was the D. W. R. Itself which, in order to promote its own interests preferred to advance loan on terms which were much less favourable to the promoters than the terms upon which a similar loan could have been obtained from a financial institution.

(4) That measures were taken after the promulgation of Martial Law Regulation No. 103 to malign the character of not only the promoters of the mill but also the respondent's father publicly. It was openly publicized that the respondent's father had declared foreign exchange and that investment in the company was made by the promoters out of the loan taken from the Army funds to give a false impression of their character "as like demons".

(5) That the foreign exchange of the respondent's father- -which was declared under Martial Law Regulation No. 103 and repatriated to Pakistan including the bonus amount was frozen by the State Bank of Pakistan under instructions from the Central Government at a time when no such law existed. To give a cover to it, an Ordinance called the Foreign Exchange (Prevention of Payment)

Ordinance, 1972, was promulgated which was amended thrice so as to make it applicable to the respondent's father's case. Such action was not taken against any other individual, person. Or body. Corporate. It was a proof of malice against him as he was the only person singled out for action under this Ordinance.

(6) That the respondent's father was removed from the "Managing Directorship" of the Bank before nationalization of the banks which action was taken by the State Bank of Pakistan under instructions from the Government of Pakistan headed by late Z. A. Bhutto.

(7) Mala fides of the actions impugned was obvious from the intent and tenor of these legislative instruments which tended to determine the terms and conditions of the transfer unilaterally. The compensation for the shares determined under the President's Order No. 22 of 1972 at Rs.

8.69 per share instead of its face value of Rs. 10 and the withholding of the compensation amount for being adjusted towards the repayment of the loan payable by the promoters or the Managing Agents was an instance of malice when such loans were "secured loans" and repayable according to the stipulations, in writing, at a later date.

(8) That pursuant to certain inquiries made by the respondent it has some to light that soon after late Z. A. Bhutto took over as President and C. M: L. A. On 20th of December, 1971 he showed. His inclination to deprive the respondent's family of the mill and, therefore, directed a case to be made out for such action immediately. Accordingly, a probe was ordered on 20th of December, 1971 and a decision was taken on 23rd of December, 1971.

30. On these facts, the validity of the legal instrument was attacked as under :-

(a) .That neither the respondent, who was in control of the management and the affairs of the company nor any person on his behalf was heard before their promulgation and, accordingly, they were condemned unheard.

(b) The action,taken by the appellant thereunder amounted to depriving the respondent and other shareholders of their lawful rights and interest in the property without any legal justification and, therefore, it was illegal and of no effect.

(c) That Martial Law Regulation No. 103 was ultra vires the proclamation of Martial Law dated 25th of March, 1969, as it purported to be legislated on a subject which was not enumerated therein and, therefore, it was not protected by Article 281(1) of the Interim Constitution.

(d) As the President's Order No. 22 of 1972 was 'published in the Gazette of Pakistan (Extraordinary), dated 22nd of April, 1972, it could-not be promulgated as such in the purported exercise of the powers of the President and the C. M. L. A. After the Martial Law was lifted on 21st of April, 1972, through a proclamation.

(e) In the alternate, as President's Order No. 22 of 1972 traversed a ground outside the scope of paragraph 2 of Martial Law Regulation No. 103, it was without lawful authority even if the legal competency of Martial Law Regulation No. 103 was conceded for argument sake. In other words, what this paragraph provided was for the determination of the terms and conditions of the transfer of the rights etc.. And not the transfer of the limited company into sole ownership.

( f ) That the previous operation of Martial Law Regulation No. 103 was not saved by Article 295 of the Interim Constitution,- consequent upon its repeal by the Interim Constitution, as the words "duly done or suffered" therein, did not, within their ambit include any action which was not lawful despite the validation, if any, given to it under Article 281(1) of the Interim Constitution and as for the President's Order No. 22 of 1972, it took effect only after its publication which was after the date of its repeal. Therefore, actions taken, thereunder were also not protected under Article 295. In the alternate, even if it be said to have been issued on 20th of April, 1972, Article 295 protected only those actions which were lawfully done after its issuance and before its repeal on the next day but not those actions which were done under its cover after 21st of April, 1972.

(g) That President's Order No. 22 of 1972 could not operate retrospectively so as to confer sole ownership on _the appellant as from 30th of December, 1971; and further, it was violative of Article 20 of the Interith Constitution as it purported to deprive the respondent and the other shareholders to dispose of property against their will and violation at a price not negotiated by them.

(h) That President's Order No. 22 of 1972 was violate of Article 21 of the Interim Constitution as it authorised the continued deprivation of the respondent of his right to the assets etc. Of the company when such deprivation was not covered by any of the exceptions in clause (3) of Article 21.

(i) Martial Law Regulation No. 103 and the President's Order No. 22 of 1972 were issued in excess of the powers and the authority conferred by the 1962 Constitution as well as the Interim Constitution of 1972.

( j) That President's Order suspending the right to move a Court for enforcement of any fundamental right specified therein during the subsistence-of the emergency did not operate to justify either legislative or executive actions violative of Article 21 in the face of the embargo contained in Article 7 of the Interim Constitution. The other limb of the plea was that as the operation of Article 3 was not suspended, hence no Court would countenance any legislative or executive action which was not sanctioned by law.

(k) That Article 281(2) of the Interim Constitution did not protect actions or orders which were mala fide and without jurisdiction, that is, those actions or orders which were for a "colourable purpose".

This plea related to legal mala fides.

(I) That the amended Article 281(2) of the Interim Constitution did not oust the jurisdiction of the Supreme Court to examine the legality of the legal instruments on grounds of coram. Non judice, mala fides or absence of jurisdiction.

(n) The legislative instruments were not valid as they failed to provide for compensation and further that the value of the share could not be determined below its face value without notice to the shareholders including the respondent who were affected thereby. It was next pleaded that as such determination did not disclose the basis of computation, it was mala fide, arbitrary and capricious.

(n) The authorisation in President's Order No. 22 of 1972 to adjust the loan of Rs. 90 lacs plus the interest up to December, 1971, from the value of the .Shares .Due to the promoters was without legal sanction and devoid of jurisdiction particularly when the loan was advanced for being invested in the project and had been so invested. Such authorisation was penal and rendered the orders as being "confiscatory", "proprietary" and "rnala fide".

(o) In view of the mula fides pleaded against the father of the respondent and his family members, the legal instruments were issued in bad faith and, therefore, had no sanction of a legislative measure.

31. Before I proceed to advert to the findings of the High Court, I would refer here to the further facts, pleaded by the respondent before this Court:-

(a) That the mill was taken over on a "false pretext of insecurity of the funds invested in the Mill by the D. W. R. Which eminently was "the brain child of Maj.-Gen. (Retd.) Nawaz Malik". Apart from the consideration of the security of the funds of the D. W. R., which led to the promulgation of Martial Law Regulation No. 103 as discernible from his note dated 21st of December, 1971, and 24th of December, 1971, some new facts "have been tortured out of acts and events of no consequence, such as the writing of a few notes and letters by the D. W. R., and thrust into the case just in an attempt to create confusion and prejudice as also to provide the M. L. R. With additional props, though ex post facto".

(b) Further, it was asserted that all the funds of the D. W. R. Were secured and, therefore, there was no truth in this allegation. In this connection it was also pleaded that even if it was conceded for argument sake, that the funds were not properly secured still the mill could not be taken over under the cover of Martial Law without the resort of due process of law which, within its concept, included the right of being heard. Reference was made to the adequate provisions existing in the civil laws of the country for providing relief in case of breach of contract and for winding up the mill for any valid reason. In any case, the least that could have been done was to ask the respondent to secure the investment in an acceptable manner failing which to repay the whole amount advanced.

(c) The extreme step of taking over of the mill should not have been resorted to when one of the alternatives considered in the meeting on the 23rd of December, 1971, was available for safeguarding the Welfare Funds, namely, that the shares of the mill of the value of Rs. 90 Lacs could have been transferred to the D. W. R. Which would have left the respondent's group's shares of the value of Rs. 10 lass. This was not done because the object was to totally eliminate the respondent and his group from the mill. Reliance was placed on the affidavit of Brig. Mahmood, Director, Welfare and Rehabilitation, to the effect that the W. R. Had no reason to feel apprehensive of their investment in the project; and in rebuttal of the contents of the affidavit filed by Lt.-Gen. (Retd.) Gul Hassan, justifying the issuance of Martial Law Regulation No. 103, it was asserted that his was a tailored statement which could be demonstrated to be a false statement.

(d) Further, it Was impressed that the name of Lt,-Gen. (Retd.) Gul Hassan did not transpire in the entire proceedings of the High Court and, therefofe, it was "quite apparent and has even been claimed on behalf of the Fauji Foundation that it was General Nawaz Malik, the Managing Director of the Fauji Foundation, who took the initiative, obviously at the behest of Mr. Zulfikar Ali Bhutto himself,"

(e) Again, it was apparent from the contents of the affidavit of Brig. Mahmood that these not only belied the assertion of Lt.-Gen. Gul Hassan but also eminently showed that it was late Z. A. Bhutto who initiated the impugned action. In this connection reliance was also placed on the comments dated l'8th of August, 1972, of the Managing Director, Fauji Foundation, submitted to late Z. A. Bhutto in reply to the representation made to him by Inamur Rehman.

(f) That despite the opinion of the Ministry of Law and the State Bank that the funds repatriated by Inamur Rehman could not, under M. L. R. 104, be legally frozen, late Z. A. Bhutto promulgated Ordinances so as to deprive him of the repatriated amount. Reliance was placed on late Z. A.

Bhutto's order dated 2nd of July, 1972, passed on the Finance Secretary's note dated 24th of June, 1972, and the note of the President's Secretariat bearing his remarks dated 28th of October, 1972.

(g) Another note (R/29) forwarded to the Security Adviser to the President also showed his hostility as his father was called by Saeed Ahmed Khan and was given "a complete dressing down with a warning that unless he 'behaved' nobody could tell what the consequences would be."

(h) It was averred that the respondent's father, on account of his influence, had managed with PICIC, IDBP, ICP, NIT and Grindlays Bank the securing of funds and credits amounting to Rs.

4.14 crores. Accordingly, the participation of the D. W. R. In the project, had no influencing factor for obtaining these funds and credits. It was further asserted that it was the respondent's father who arranged the suppliers credit of Pound Stg. 2,075,738, provided by A & W Smith & Co. Of England, the suppliers of sugar manufacturing machinery.

(i) It was next stated that as from the note dated 31st of December, 1968, of Maj.-Gen. Pirzada submitted to the Chief of Staff, it was clear that the Fauji Foundation had their hands full with various new projects and that it was not in a position to set up the proposed mill at Khoski.

Therefore, the Chief of Staff wrote to the Governor of West Pakistan for arranging some reliable party to install the proposed mill which project was eminently for the welfare of the settlers who were the ex-servicemen. The respondent further relied on the affidavit of General (Retd.)

Muhammad Musa which belied the fact that it was the respondent's father who managed to get the help of G. H. Q. To obtain permission from the West Pakistan Government.

(j) In regard to the letter of the Adjutant-General dated 14th of-February, 1970, addressed to the Economic Affairs Division, for grant of permission to the mill to place marine insurance with Standard Insurance Company instead of Pakistan Insurance Corporation, it was averred that Pakistan Insurance Corporation did not itself write marine insurance; and as it was only a reinsurer to the extent of 30% of the business written by other insurance companies, therefore, there was nothing derogatory in making this request as alleged by the appellant. In this connection a letter dated 27th of April, 1981, of the appellant, addressed to Messrs Boiler Engineering Services, was relied on,

(k) As for seeking the tax holiday for six years for the mill, it was pleaded that this request was not unusual but such concession was available to new industries in general and the final decision rested with the Cabinet.

(I) As for the failure to furnish bank guarantee, the respondent relied on the admission of the appellant in para. 3(xiv) of the Memo. Of Appeal that such guarantee was furnished. Besides, this fact stood confirmed by the loan agreement itself and was also clear from the Adjutant-General's letter dated 17th of June, 1970, addressed to the Standard Bank acknowledging the possession of the guarantee and further stating that it would not be released until such time as the share certificates for Rs. 1 crore were deposited with the Standard Bank and a confirmation to that effect was sent to the D. W. R.

(m) As for the non-delivery of the shares as security, for the loan of Rs. 90 lacs to the D. W. R., it was averred that the shares had to be deposited with the Standard Bank to be held in pledge on behalf of the D. W. R. And that such fact stood confirmed by letter dated 22nd of March, 1971, of the A. R. K.

Industrial Managements Ltd. Addressed to the Standard Bank Ltd., forwarding share certificates of the value of Rs. 1 crore alongwith relevant transfer deeds duly signed for holding the same in pledge for the D. W. R.

(n) Replying to the allegation that the respondent's family had obtained "call loans" from the Army Group Savings Account in the Standard Bank Ltd. To finance their own projects, the respondent relied on the letter dated 15th of December, 1970, of A. R. K. Industrial Managements Ltd., to the Standard Bank Ltd. In which ,a request was made for a loan of Rs. 21 lacs and transfer of the loan funds to the mill. This borrowing was undertaken from the bank for the benefit of and investment in the mill project and as such there was nothing unsavoury in it.

(o) As regards the report of the Auditors that the debenture loans were unsecured; the respondent relied on the loan agreement and the registered mortgage deed which showed that the debenture loans were fully secured by mortgage of property. This fact was suppressed by the Auditors. In this connection it was further averred that there was invariably a time lag between the registration of the Trust Deed and the formal issuance of debentures as these were only issued on the basis of the Trust Deed; however, it was not the formal debenture pro forma which constituted the security but the mortgage itself was the security.

(p) As for the non-issuance of the debentures, the reason assigned' was the abrupt and malacious dissolution of the company and the transfer of its assets to Fauji Foundation in December, 1971.

(q) As regards'the financial involvement of the respondent against the' investment of the D. W. R.

Amounting to Rs. 155 lacs, a figure of Rs.

384.5 lacs was given out. Its break-up was as under:- {{TABLE}} Rs.

(1) Subscription to share capital 100 lacs

(2) Loan to be treated as $ubscriptioa to debentures by I A: R, K.10 14c5

(3) Bridging loan repayable from public subscription to Rs. share capital obtained against guarantee of the respondent. 75 lacs

(4) Loans of financial institutions security for which included the guarantee of the respondent .... 85 lacs

(5) Advances by Associate Concerns .... 6.5 lacs

(6) Advances by Directors and Managing Agents .... 1 lac

(7) Advances by sponsors on the basis of Balance-Sheet . ... 107 lacs 384.5 lacs The other financial arrangements made by the respondent through his father were wholly outside this heavy financial involvement of Rs. 384.5 lacs. The details of the said financial arrangements are as follows :

(1) Suppliers credit.-- 2,075,738

(2) P. i. C.

1. C. - Loan.54,369

(3) P. I. C. I. C. - Bridging Loan.Rs. 50,00,000

(4) I. C. P.-Loan for debentures.Rs. 25,00,000

(5) I. D. B. P.-Loan for debentures.Rs. 5,00,000

(6) Customs - debenturesRs. 32,10,239

(7) A. D. B. P.-Loans to farmers.Rs. 27,88,971 The aggregate amount involved in these arrangements was about Rs. 380 lacs

(r) As to the claim of the appellant that it had discharged the liabilities of the mill, the figures given by the appellant did not tally with the Balance-Sheet of the Company.

(s) As regards the allegations about the foreign exchange repatriated by Inamur Rehman, it was asserted that an affidavit, sworn by Mr. Slater was manipulated pursuant to a threat given to him that legal action would be taken in Pakistan and in England for certain matters connected with the machinery supplied and for the alleged payment of commission to Mr. Inamur Rehman for the supply of the machinery for the sugar mill. This was after Mr. Slater had conceded that the commission was payable in the normal course in relation to the machinery supplied by the company.

(t) The respondent also relied on his and his family members personal investment of Rs.

1.17 crores apart from an amount of Rs. 90 lacs, received as loan, on the Balance-Sheet of the Mill and it was reiterated that the investment of borrowed funds was never considered a tainted investment justifying a sequestration of such interest.

(u) It was next asserted that the advance of Rs. 65 lacs in the name of the respondent's father was recorded in the State Bank's inspection report but he was exonerated from, this unjustified liability as it was unauthorisedly created in his name.

(v) Lastly, the respondent vehemently asserted that the charges levelled against him were palpably false and that a vain attempt was made by the Fauji Foundation to suppress, distort, twist and misstate the facts in its avid desire to retain a prize project which is now generating phenomenal profits. It was further given out that the appellant became its sole owner as a result of a calumnous conspiracy between a law-giver who had a personal score to settle with the respondent's family.

32. The High Court, while dealing with the respective contentions of the parties held as under:-

(a) In regard to the appellant's submission that the respondent having earlier pleaded malice in law could not now be permitted to raise the plea of malice in fact, the High Court rejected it on the ground that the amendment having earlier been allowed, that order could not be reviewed as the expression "subject to all just exceptions" did not mean that the order itself could be reviewed and all that it conveyed was that the allegations of fact could only be challenged. As to the propriety of the amendment, it was held that as averred rightly, the respondent could not muster courage to bring any allegation against the then President and the Chief Martial Law Administrator of Pakistan and that in any case the present Government was bound by its statements contained in the "White Papers" and thus estopped from raising any objection with regard to the nature of mala fide pleaded by the petitioner.

(a) It was next held that the Court had the jurisdiction to examine the validity of Martial Law Regulation No. 103 as it was not, in any manner, barred by the language of Article 281(l) of the Interim Constitution for the reasons:-

(i) That as General Yahya Khan was himself a usurper, hence transfer of power by him to his successor' also fell in the same category and the power which he exercised was no less tainted than what it was in the hands of his predecessor. Thus, on this footing, the Martial Law Regulations and Martial Law Orders, promulgated by late Z. A. Bhutto, were treated at par as that promulgated by his predecessor in clause (1) of Article 28.1 of the Interim Constitution as held in Miss Asma Jilani v. The Government of the Punjab and another PLD 1972 SC 139.

(ii) In the aforementioned background, the High Court next examined the language of Article 281(1) of the Interim Constitution in the context of the contention that it was worded to cure the competency but not the validity of the legislative instruments and held that as Martial Law Regulation No. 103 and 'President's Order No. 22 of 1972, did not find place in the Seventh Schedule to the Interim Constitution, their validity was open to judicial scrutiny on the basis of the test of condonation enunciated in Asma Jilani's case eminently for the consideration that the repealed legislative instruments did not enjoy greater protection in comparison to those which were saved and simply treated as acts of appropriate Legislature whose validity could be tested on the basis of the provisions of the Constitution itself. Article 281(1) was thus interpreted to mean only to give competency to the legislative instrument but not validity In holding so, the High Court relied on section 4 of the Validation of Laws Act, 1956; certain observations in The State v. Zia-urRahman and others ,L D. -1973 SC 49; Saeed Ahmad Khan v. Federation of-Pakistan PLD 1974 Lab. 187

(iii) Concluding thus, the High Court, while construing the ratio decidendi in Zia-ur-Rahman's case held that the Supreme Court in that case was not called upon to pronounce judgment as to whether -the allegation of mala fide was inadmissible in relation to legislative instruments.

Therefore, the proposition of law that the High Court could examine the plea of mala fide in relation to legislative instruments could not be ruled out. On this basis the High Court further posed a question that if it could be successfully demonstrated that a legislative instrument was conceived in bad faith and enacted inala fide or for any collateral purpose then there was no bar in declaring such a legal instrument as void. The High Court, from another point of view, poised a question to itself, that is, "that what is void, does not exist in the eye of law and what does not exist, could not have been validated by the Parliament as a constituent body". Thus, peremptorily, for the reason that the constituent body could not be imputed the motive of perpetrating manifest injustice, it could not, therefore, validate void legislative measures , or such legislative instruments as were conceived in bad faith and were enacted mala fide or otherwise were such as could not have been promulgated competently by any legislature itself.

(iii) In repelling the contention of the appellant that the validity of the Martial Law Regulations, Martial Law Orders and all other laws made between the 20th day of December, 1971, and 20th day of April, 1972, could not be challenged in the face of the expression "on no ground whatsoever" in clauses (1) and (2) of Article 269 of the 1973 Constitution, the High Court held that this submission had no substance in view of the interpretation given to this expression in The Federation of Pakistan v. Saeed Ahmad Khan and others PLD 1974 SC 151.

(c) As for the appellant's contention that mala fides could not be pleaded against the Legislature and the Legislative instruments nor could the question of malice or motive of the legislature be ,examined by the Court as it was extremely difficult to prove that its members had acted mala fide or that a fraud was played upon them, the High Court drew a distinction in that, that the cases cited by the counsel for the appellant namely, the dissenting opinion of Muhammad Yaqub Ali, J.

(as he then was) in Qaseem-ud-Din v. The Province of West Pakistan PLD 1959 Lah. 76; Leo M. Mc.

CraY v. United States 195 U S 27 ; Charles E. Smith v. Kansas City Title & Trust Co. 255 U S 180; John M.

Daniel v. Family Security Life Insurance Co. 220 U S 220; Intere State Commerce Commission v. W. G.

Brimson 154 U S 447; Punjab Province v. Malik Khizar Hayat Khan Tiwana PLD 1956 FC 200; State v.

Ziaur Rahman the principles cited M the Corpus Juris Secundum (Vol. 16, page 809) and Willoughby'sBook on the Constitution of the United States (Vol. 1, 2nd Edn.), related to legislative instruments passed by an elected body of Legislatures which had no relevance to the question involved in the petition as the legislative measures impugned were those of an individual which were passed in the exercise of a mandate conferred on him by law or by reference to the power he had been successfully able to arrogate to himself as a law-making force in which capacity he could not be immune from human failings, infirmities and susceptibilities and, therefore, there could not be any rigid rule that whatever was enacted by an individual was sacrosanct and beyond any reproach, which was not true in the case of a legislative body as the responsibility for the making of the legislative measure was shared collectively by a large number of individuals who could not, in that capacity, suffer from this shortcoming. The High Court, in holding so, relied on the opinion of Kaikaus, J. (as he then was) in Qaseem-ud-Din v. The Province of West Pakistan and Emperor v. Benori Lal Sarma AIR 1945 P C 48; the opinion of Muhammad Yaqub Ali, J. (as he then was) in Asma Jilani's case and Privy Purses case AIR 1971 SC 320.

(d) As to whether Martial Law Regulation No. 103 was qualified to be treated as a law or as a legistative instrument or was an executive fiat, the High Court held that the Legislature could not usurp judicial power on the principle of separation of powers and pass any law in relation to an individual as against a law of general application which to all intents and purposes was a "judgment and sentence" and liable to be struck down. For this conclusion, the Court pre-emptorily relied on the dictum of Salahuddin, J. In Asma Jilani's case, at page 266 of the Report ; and on the factual side the High Court took note of the fact that there was no preamble in the regulation and that it did not claim to have been issued for any public purpose and for the further reason that there was no occasion to issue such a legislative measure for the reasons disclosed in the notes of the Managing Director of the appellant dated 21st of December, 1971 and 24th of December, 1971, coupled with the circumstance that the counsel for the Government of Pakistan failed to produce the complete file in respect of the inquiry held on 22nd of December, 1971, before the promulgation of this instrument which could throw a light on its background. The High Court thus drew an adverse inference in regard to the bona fides of the lawgiver against the appellant in the context of the submission of the learned counsel for the respondent that such legislative instrument could not have been passed in any civilised country. In holding so, the High Court relied on Ram Prasad Narayan Sahi and another v. The State of Bihar AIR 1953 SC 215 ; Ameerun Nisa v. Mahboob Begum AIR 1953 SC 91 and Smt. Indra Nehru Gandhi v. Raj Narain AIR 1975 SC 2299.

(e) The appellant's objection that since the fundamental rights guaranteed under the 1973 Constitution stood suspended, the validity of the Regulation and the Order could not be attacked on the ground of violation of any of the Articles relating to the fundamental rights by virtue of the Provisional Constitution Order, 1969 whereunder fundamental rights enacted in paragraphs 2 to 15 and 17 in Chapter I of Part II of the 1962 Constitution stood abrogated, did not weigh with the High Court as it was of the opinion that the Constitution of 1962 was automatically revived in view of Asma Jilani's case although the emergency proclaimed under Article 30 of the Constitution of 1962 still remained in force but despite it the President was not competent to make any legislative measure like the impugned legislation in view of the provision contained in clause (8) of Article 30 of the Constitution of 1962 as during the emergency period the power of the President to make laws extended only to the making of the laws within the legislative competence of the central Legislature which did not include the subject of acquisition or requisition of property.

(f) The High Court further rejected the contention of the second appellant based on the decision of the case reported as Board of Trustees v. The State of Delhi AIR 1962 SC 458, namely, that inasmuch as item No. 13 of the Third Schedule to the 1962 Constitution, provided for the dissolution of companies, the President and C. M. L. A. Was competent to issue the Regulation in the exercise of powers in the central legislative field as designated in the Schedule on the ground that as admittedly the objects and business of the mill were confined to the Province of Sind only, therefore, the central Legislature could not have passed any law for the winding up of the company acting under Item No. 13, the moreso as paragraph 2 of the Regulation did not talk of the winding up of the company but of its dissolution which was not, by itself, a field of legislation and to this extent, there was over-stepping from the legislative field. As to the efficacy of the case relied on, the High Court was of the opinion that it was absolutely irrelevant to the question involved in this case and in preference to it, the High Court accepted the dictum of the Supreme Court of United States in the case of The Trustees of Dartmouth College v. Woodward (1819) 4 Wheat 629 -wherein it was held that the acts of Legislature of New Hampshire were repugnant to the Constitution of the United States. The significant feature in this case was the question posed by Mr. Webster, the counsel for the plaintiffs, as under :- "Are, then, these acts of the Legislature, which affect only particular persons and their particular privileges, laws of the land? Let this question be answered by the text of Blackstone: 'And first' it (i. e.

Law) is a rule; not a transient sudden order from a superior, to, or -concerning, a particular person; but something permanent, uniform, and universal. Therefore, a particular act of the Legislature to confiscate the goods of Titius, or to attain him of high-treason, does not enter into the idea of a municipal law ; for the operation of this act is spent upon Titius only, and has no relation to the community in general : it is rather a sentence than a law."

This became the sheet-anchor for decision and was relied on by the High Court.

(f) The High Court further took guidance from paragraph 3(i) of the Provisional Constitution Order dated 4th of April, 1969, wherein it was provided that "notwithstanding the abrogation of the Constitution of 1962, the State of Pakistan shall, except as otherwise provided in the Order, be governed as nearly as may be, in accord Once with the said 'Constitution" as construed by A. R.

Cornelius, 3. (as he then was) in State v. Dosso PLD 1958 SC (Pak.) 533 ; and in Province of East Pakistan v. Mehai Muhammad All Khan PLD 1959 SC (Pak.) 387 ; and the subsequent cases reported as Muhammad Afzal v. The Commissioner PLD 1963 SC 401 and Malik Mir Hassan v. The State PLD 1969 Lah. 786 and hence reached the conclusion that notwithstanding the existence of Martial Law, the President and the C. M. L. A. Was not at liberty to make and promulgate any arbitrary legislative instruments disregarding the limitation contained in the abrogated Constitution of 1962. This was not all as constraints also existed upon his power as were essential and necessary concomitants to the exercise of legislative functions by the Legislatures of the civilised countries, that is the constraints of the norms of law-making. In this behalf, the High Court laid emphasis on the observations of Sajjad Ahmad Jan, J., in Asma Jilani's case.

(h) In regard to the respondent's contention that the legislative instrument was a law in relation to the sequestration of proprietary rights of an individual juristic person, that is, the Rehmania Fauji Sugar Mills Ltd. And its constituents, namely, the promoters and shareholders of the company, such Regulation, if at all, could only be justified on the principle of "eminent domain" which had inseparable incidence of sovereignty and existed without any declaration to that effect, the High Court held, that as the respondents themselves claimed that the impugned Regulation was issued in order to secure the investment made in the company out of the Army Welfare Funds, this proclaimed object had no nexus with any public purpose and hence the acquisition was not in the exercise of the power of "eminent domain" but a punishment as by no legislative measure, the property of one could be taken and given to another. For this the High. Court relied on Charanjit Lal v. Union of India AIR 1951 SC 4l ; Westminster Corporation, London v. North Western Railway, U. S. (1904) 1 Ch. 759 ; Webbs v. Minister of Housing (1965) 1 W L R 755 ; Associated Provincial Picture Houses Ltd. v. Wednesbury Corporation (1948) 1 K B 323 ; General Pacific R. R. Company v. Gallatin (1879) 99 U S 727 ; Edward Mills Co. Ltd. v. State of Ajmer AIR 1955 SC 25 ; certain observations of this Court in Zia-ur-Rehman's case ; American Jurisprudence, Vol. 18, page 658; Cooley, in his Treatise on the Constitutional Limitations, 1972 Edn., page 91, at pages 92, 354 and 362 ; Bernard Schwartz's book "A Commentary on the Constitution of United States", 1977 Edn., Part 2 at page 23 ; and Salmand's Jurisprudence, 12th Edn., page 43.

(I) The High Court pre-emptorily negatived the contention of the learned counsel for the second appellant that the impugned Regulation was issued for the benefit of a class of Army Personnel and in that sense it was intended to serve public purpose on the ground that the facts pleaded did not warrant any such interference, the moreso in the context of its objects to secure the investment made in the company out of the Army Welfare Funds which could well be characterised as mala fide but not a public purpose.

(j) As to the plea of the respondent that the impugned legislative instruments were issued mala fide, the objections of the first appellant: firstly, that in the petition, as originally filed, the principal allegation of the respondent was that the making of the Regulation was a masterly manoeuvre on the part of the Fauji Foundation and hence the allegations were not directed against the maker or the making of the impugned Regulation was rejected by the High Court on the ground that the pleadings, read' as a whole, did not show this stand as undoubtedly the petitioner had raised the plea of mata fide in a subdued language against the issuance of the Regulation ; secondly the High Court was further of the view which now stood confirmed not only from the assertions made but also from the material in the "private file" of the Fauji Foundation itself that it was the Fauji Foundation which was responsible for the issuance of the Regulation ; thirdly, that a , vain attempt was made by the first appellant to mix up the identity of the D. W. R. Which was a distinct and independent body with the "G. 1-1. Q." and the-"Pak Army" to bring about the anxiety which pre- empted the making of the Regulation and such anxiety, in the opinion of the High Court, had successfully prevailed with late Z. A. Bhutto who had assumed office only three days back to accede to their self-motivated request of making the impugned Martial Law Regulation in order to "kill" the company ; fourthly, that by not producing the file relating to the issuance of these legislative measures, the appellants had failed to prove that the legislative measure was not vitiated on account of any extraneous or collateral consideration but issued as a usual legislative instrument. The High Court also took note of the fact that the first appellant did not file any counter-affidavit to controvert the allegations which were denied generally in the counter-affidavit of the second appellant and rejected the explanation of the Deputy Attorney-General that inasmuch as the allegations of mala fide were directed against late Z. A. Bhutto, it was unnecessary for the first appellant to rebut those allegations which were pleaded in the amended petition as in its view except for one allegation, namely, that of making a speech during his election campaign in 1970, the other grounds were directed against him in his official capacity as the President and the Chief Martial Law Administrator ; and fifthly, the High Court was of the view that it was the substance of the case and the pleadings as a whole which were to be examined to meet the ends of justice and, accordingly, proceeded to examine the notes dated 21st of December, 1971 aid 24th of December, 1971, in the background of the agreement dated 21st of January, 1970, the other facts pleaded by the respondent to impress that there was no occasion for the issuance of the legislative instruments particularly when the promoters of the company had well utilised the funds and successfully established the sugar mill which had, gone into production before the impugned action, the incriminatory action taken against Inamur Rehman in regard to the deposit of his repatriated amount in the State Bank and the failure to afford to him the opportunity of hearing despite his detailed representation and reached the following conclusion :- "The irresistible conclusion reached . By me, in the, circumstances, is that the idea of making the Regulation was conceived in the course of a private discourse, and a Regulation adopted in the meeting, was issued in the form of Regulation. It was passed in colourable exercise of legislative power for a collateral purpose."

What followed from this was that the impugned Regulation was issued mala fide and was void ab initio. It was, therefore, not protected under Article 281(1) of the Interim Constitution or Article 260 of the 1973 Constitution.. The High Court took into consideration the facts that the mill was not nationalized under the Economic Reforms Order, 1972; that the question regarding the issuance of the impugned Regulation was conceived in the course of a meeting held in the President's office on 23rd of December, 1971; the request of the second despondent by letter dated 24th of December, 1971 for the issuance of Martial Law Regulation in the light of the purported decision taken in the meeting; the disclosure of the minutes of the meeting held on 23rd of December, 1971, by the first appellant from its record, which was an interested party; and finally the non-production of the relevant file, and held that all this material indeed went a long way to support the respondent's submission that the Regulation was in fact an executive fiat and not a legislative instrument.

33. In regard to the validity of the President's Order No. 22 of 1972 dated 20th of April, 1972, the High Court held

(1) That it was a creature of the impugned Regulation and had no legs of its own to stand upon.

(2) This Order was also void ab initio on the parity of reasons given for holding Martial Law Regulation No. 103 as ill-motivated and issued mala fide.

(3) The High Court next concluded that independently of mala fides, it did not stand the test of scrutiny on its examination as it failed to qualify as a legislative instrument independently of the Regulation.

(4) That the Order fell outside the scope of the Regulation which by para. 2 only provided for determining the terms and conditions of transfer whereas in the Order new terms were coined such as "family of promoters" and "promoters" with a view to achieve some ulterior object which did not strike the mind of the law-giver at the time of the issuance of the Regulation.

(5) The adjustment of loan under para. 2(3) of the impugned Order was improper as it was outside the scope of para. 2 of Martial Law Regulation No. 103, as the contract of loan was not between the company and the D. W. R. But between the promoters and the D. W. R. And a new term was coined in the Order, that is, the "family of promoters" to cover this contingency.

(6) An improper distinction was drawn in the second proviso of the impugned order in regard to the payment of compensation to the promoters, their family members and the Managing Agents and the shareholders, in that, that it were only the three categories, first mentioned, who were subjected to the adjustment of the compensation against the loans due from them but not the sharehorders.

(7) That the fixation of compensation in the impugned Order militated against the principle of natural justice as para. 2 of Martial Law Regulation No. 103 provided for a determination which term meant an inquiry, adjudication and the hearing of the persons affected and not an arbitrary fixation of the compensation. In holding so, the High Court relied on Abdullah Muhammad Peer Muhammad v. Karachi Municipal Corporation PLD 1971 SC 130 ; Jaswa nt Sugar Mills Ltd. v. Lakshmi Chand and others AIR 1963 SC 677 ; Pir ,Shah 'Vardar; Si,* v. Chief Land Commissioner P L p 1974Kar.

375 ' Ridge v. Baldwin (1963) 2 A E R 66 and Anisminic Limited v. The Foreign Compensation Commission and another (1969) 1 A E R 208.

(8) The High Court, in the alternate, concluded that even if it be assumed that the impugned Order was a valid Order, nonetheless the action taken in fixing the compensation arbitrarily at Rs.

8.69 per share as against its face value of Rs. 10 per share, was void.

(9) The High Court next held that as Martial Law Regulation No. 103 was promulgated on 31st of December, 1971, and took effect immediately, the ownership of the mill could not be transferred to the Fauji Foundation one day earlier, that is, on 30th of December, 1971, before the parent law became operative. This flaw went to the root of the impugned Order as the terms and conditions of transfer took effect from 30th of December, 1971, when the Regulation itself was not in existence.

(10) The High Court lastly held that the Order dated 20th of April, 1972, did not exist at all as by reason of the promulgation withdrawing the Martial Law on 20th of April, 1972, the office of the Chief Martial Law Administrator came to be abolished instantly after the mid-night on 19th of April, 1972, and, therefore, no order under paragraph 2 of the Regulation could be issued on 20th of April, 1972.

(11) The High Court rejected the submission of the learned counsel for the appellants resting on the decision of this Court in Asad Ali v. Settlement and Claims Commissioner PLD 1974 Kar. 345, that is, that the Provisional Constitution Order was re-enacted on the coming into force of the Interim Constitution and then repealed and, therefore, its earlier withdrawal lost its significance and all proceedings pending in Court were saved by Article 295 of the Interim Constitution, on the ground that the withdrawal of the proclamation was rectified to read as 21st of April, 1972, instead of 20th of April, 1972, which was not pointed out in the aforementioned case and that this controversy was now settled by a judgment of this Court in Mehreen Zaibun Nisa v. Land Commissioner PLD 1975 SC 397.

(12) The High Court rejected the submission of the first appellant that as the company already stood transferred to it and that it had run the mill and discharged its liabilities, it was a case of past and closed transaction and beyond the realm of any attack, on the ground that no vested rights could accrue on the basis of a void instrument, that is, from the very inception the first appellant did not acquire any interest in the company muchless any vested right. Additionally, the High Court held that the plea of past and closed transaction was not sustainable on facts as the first appellant was still engaged in bringing actions against the respondent and his father under the Regulation which amounts to a continuing wrong giving rise to a continuing cause of action.

34. In the result, the aforementioned Constitutional Petition succeeded, but as the issues decided involved substantial questions of law relating to the interpretation of the Constitution, the High Court granted the certificate under Article 185(2) (f) of the 1973 Constitution. Aside from A it, the appellants filed a petition for special leave to appeal ; and leave was unconditionally granted to consider the legality of the legislative measures which were struck down as ill-motivated and for other legal flaws.

35. Mr. Noorul Arvin, learned counsel for the appellant, challenged the over all conclusions of the High Court and contended as under :-

(1) That the High Court erroneously held that the expression "subject to all just exceptions" foreclosed the challenge to the order allowing the amendment of the petition and left open only the dispute as to the veracity of the allegations which enabled the respondent to change his stand on the plea of mala fides.

(2) That the High Court erred in holding that personal mala fides could be taken into consideration in regard to the legislative instruments. In other words it held that it had jurisdiction to subject Martial Law Regulation No. 103 and Presidential Order No. 22 of 1972 to judicial review to test its motivation despite the provisions of Articles 281(1) of the Interim Constitution and 269(1) of the 1973 Constitution which gave blanket protection to these legislative instruments so that the Courts were debarred from examining their validity on account of the unconditional ouster clauses in these Articles.

(3) That Articles 281(1) of the Interim Constitution and 269(1) of the 1973 Constitution, validated the legislative instruments and declared that the authority by whom the legislative instruments were made was competent to do so. The High Court, however, erroneously held, while construing these Articles, that they only declare the competency of the law-giver but do not validate the legislative instruments. In holding so, the High Court misconstrued the ouster clauses and so also did not take into consideration the provisions of Article 175 of the 1973 Constitution depriving it of the jurisdiction to examine the validity of these legislative instruments.

(4) That the High Court erred in drawing a distinction between an Act of a Legislature and an Ordinance while judging it from the angle of motives on grounds of the capacity of the law-giver such as human failings, infirmities and susceptibilities which was an irrelevant consideration in the context of the guarantee in the Constitutional provision that it had to be laid before the legislative assembly and ceases to operate on the expiry of six weeks from the next meeting of the assembly or upon the passing of the resolution by the assembly. The further reason which militates against examining the mala fides which the High Court did not take into consideration is that the Courts, being themselves the creature of law, must give effect to the laws of the country irrespective of the consideration of jurisprudence or of policy and that intra vires or an ultra vires of an Act or an Ordinance depends simply on examining the competence of the legislative authority which enacts and by no other criterion.

(5) That the High Court erred in holding--

(a) that law cannot be divorced from justice. Morality, and reason ; and

(b) that Martial Law Regulations and Martial Law Orders cannot be given the status of law. It was submitted that such a conclusion was untenable as it offended against the decisions of this Court anal Articles 210(1)t 281(1) of the Interim Constitution and 269(1) of the 1973 Constitution as by these Articles the Martial Law Regulation No. 103 and the Presidential Order No. 22 of 1972 acquired the status of constitutional provisions and not merely law simpliciter. It was next contended that the connotation of the word "law" meant positive law, that is a formal pronouncement of will of a competent law-giver which in order to qualify as law need not be based on reason or morality.

(6) That the High Court erred in declaring Martial Law Regulation No. 103 as an executive fiat on the assumption that it was opposed to the spirit supposed to pervade the Constitution but not expressed in words. Therefore, on the clear unambiguous language, of Articles 281(1) of the Interim Constitution and 269(1) of the 1973 Constitution, there is no authority for a Court to vacate or repeal a law.

(7) That the High Court has erred in holding that Martial Law Regulation No. 103 and Presidential Order No. 22 of 1972 constitute an encroachment on the judicial field as the divesting of property by direct legislation is not a judicial act for the reason that no legal standard nor any norm- was in question as a condition of, its divestings.

(8) That the High Court erroneously pressed into service the doctrine of sepakation of powers which could not provide a basis for holding that there was a legislative encroachment on the judicial field as now, under the commonly accepted rule, there is no absolute separation between legislative, judicial and executive powers ; and whatever separation there is, it is only functional and does not create water-tight compartments within the Government and ought it be said that it has not been possible to differentiate a clear cut definition of the exercise of legislative power from the exercise of judicial power. The High Court, accordingly, failed to draw a distinction between the judicial power and the exercise of that power which comes into play only to decide controversies and cases ; and that further the taking-over of a concern and its transfer to the appellant was in fact an exercise of legislative power founded on the doctrine of eminent domain and not a judicial power.

(9) That the High Court erred in holding that the legislative instruments which lacked generality are not law and further that if such legislative instrument lacked generality then it is a legislative sentence and not law and constitutes encroachment on judicial field and cannot be invoked in aid of sequestration of private property.

(10)That in any case, the discussion of the separation of powers was irrelevant as the Interim Constitution and the 1973 Constitution were framed by the constituent power, that is the National Assembly, which was unfettered by any external restraints. Therefore, it had plenary powers to validate the legislative instruments whatever normative defects they may have had.

(11)That the High court erred in holding that the legislative measures seriously impaired the rights of the citizens and in holding so the High Court tested it on the principle of legitimisation or condonaWin of the acts of the usurper and not in the context of the validation of acts even if they were that of a usurper by the constituent power. Without prejudice to the above, Martial Law Regulation No. 103 and Presidential Order No. 22 of 1972 were measures to advance and protect the welfare of the Armed. Forces service personnel and ex-service personnel ; and for the protection of public funds and, therefore, could be condoned as they stood, to promote a lawful object on this principle, as laid down by the Supreme Court.

(12)That the High Court erred in holding that these legislative instruments singled out one individual or one sugar mill out of many in violation of equal protection clause contained in Fundamental Right No. 15 of 1962 Constitution in spite of the fact that this Right remained suspended at the relevant time. In the alternate, even if it was not suspended, still it was competent to enact legislation to deal with only one person or one object or one business or one locality.

(13)That the High Court erred in holding, in the context of paragraph 3(i) of the Provisional Constitution Order of 1969, that notwithstanding the existence of Martial . Law, the President and Chief Martial Law Administrator was not at liberty to make and promulgate any arbitrary legislative instrument in disregard of the limitations contained in the 1962 Constitution. Further, the High Court erred in holding that there were constraints upon the power of the President and Chief Matrial Law Administrator as were essential and necessary concomitants to the exercise of the legislative functions by the Legislature of civilized countries ; one such restraint being the existence of a public purpose for sequestration of the proprietary rights of an individual which was wanting in these legislative instruments.

(14)That in the facts and circumstances of the case, the High Court ought to have held that the concept of public purpose or public use was merged in the concept of public welfare or public interest ; and that further the High Court erred in holding that the legislative instruments had no nexus with any public purpose as the taking of the sugar mill was not for the use by the public but for the purpose of taking the property of the dissolved company for giving it to the first appellant.

(15)That the necessity for appropriating property for a public purpose is not a judicial question, for this power resides in the Legislature and may either be exercised by it or delegated to the public officers. It was further submitted that this being a legislative question, it was not subject to the rule of natural justice ; and once the Legislature has spoken not only the public interest is declared but also it is conclusive. Therefore, it is the Legislature and not the judiciary which is the main guardian of the public needs to be served by the social legislation. It is also not necessary in the legislative instrument to set out the public purpose.

(16) That despite the requirement of Article 21(2) of the. Interim Constitution in regard to the existence of a public purpose and the provision for the payment of compensation for compulsory acquisition of property, sub-clause (2) of clause (3) of this Article saves laws from being invalidated for this reason. Therefore, the discussion in regard to the public purpose, payment of compensation for testing the validity of legislative instruments is irrelevant.

(17)The High Court has erred in questioning the validity of the purpose for the taking over of the mill and for holding that an order not made for a valid purpose was mala fide.

(18) That the High Court erred in judging the validity of the legislative instruments in the context of a statute as the proper criterion would have been to test their validity vis-a-vis constitutional provisions, but such an exercise was also unnecessary as these instruments had received validation under the Interim Constitution as well as the 1973 Constitution.

(19)That the High Court erroneously held that the mismanagement or other misconduct was not a valid purpose basing thus its opinion on the minority view of Patanjali Sastri, J. In AIR 1951 SC 41.

(20)That for protecting and realising G. H. Q. Welfare Funds, Martial Law Regulation No. 103 and Presidential Order No. 22 of 1972 were promulgated and for achieving this object, the sugar mill was transferred to the appellant under the aforesaid Regulation which was functioning as a welfare organisation, for the benefit of the service personnel of the Armed Forces and the ex-servicemen.

Accordingly, these matters were within the legislative competence of the central Legislature under the 1962 Constitution (3rd Schedule, entries 1, 2, 9 and 49). These legislative instruments were thus enacted within the competent legislative field for a public purpose/ public welfare and that purpose was not only for protecting the public funds but for promoting the welfare of the serving men and the ex-personnel.

(21)That the High Court went wrong in holding that the President and Chief Martial Law Administrator could not legislate the impugned instruments in view of clause (8) of Article 30 of 1962 Constitution as the third Schedule did not include the subject of acquisition or requisition of property in disregard of the principle that such power is embodied in the concept of eminent domain and in an inherent attribute of sovereignty independently of the constitutional limitations (public purpose and compensation) for effecting enforcement of the authority of the State against private or public property.

(22)That the High Court ought to have considered the true implication of Articles 132(2)(c) and 133 of the 1962 Constitution qua the competence of the Legislature to make laws for achieving the uniformity' in respect of any matter in different parts of Pakistan and the bar of questioning the validity of a law on the ground of its competence except in the case for the enforcement of fundamental rights which exception was also not applicable as the emergency was enforced and such rights were suspended. Therefore, the Court was not competent to question the validity of Martial Law Regulation No. 103 and Presidential Order No. 22 of 1972, or for that matter the violation of any fundamental right.

(23)That the High Court erred in holding that "dissolution of companies" by itself is not a field of legislation as entry No. 13 of the Third Schedule was not applicable having regard to the objects and business of the Rehmania Sugar Mills Ltd. Which was extended to the Province of Sind only. It was further submitted that this was not factually correct as according to the objects and business of the company, its activities were not confined to the Province of Sind only.

(24)That the High Court erred in construing dissolution in the manner it did as the dissolution is incidental, ancillary and consequential to wind up which is fully borne out from sections 194(1), 208- E(4)-and 209-H(4) of the Companies Act. Therefore, the dissolution Was in the field of legislative competence of the central Legislature as per entry No. 13.

(25)That the High Court erred in holding that prior notice was necessary before promulgating Presidential Order No. 22 of 1972 as this order was a legislative instrument for whose enforcement or promulgation the rule of audi alteram partem did not apply.

(26) That the High Court has erroneously drawn adverse inference from. The failure to produce the official files relating to promulgation of Martial Law Regulation No. 103 and Presidential Order No. 22 of 1972 as it was not competent for the High Court to order production of these files.

(27) That the High Court has misconstrued the word "determination" occurring in Presidential Order No. 22 of 1972 to connote a quasi-judicial inquiry as the subjects covered by this Presidential Order were entrusted by Martial Law Regulation No. 103 to the President and Chief Martial Law Administrator who by promulgating this order effectively ended whatever controversy or dispute there might have been in future with regard to the compensation or adjustment of liabilities or vesting of assets, liabilities and obligations. "Determination" in this context could only mean legislative fixation or settlement without any inquiry at any stage whatsoever.

28) That the High Court erroneously held that Martial Law Regulation No. 103 and Presidential Order No. 22 of 1972, being void, it did not exist in the eyes of law and, therefore, what did not exist could not be validated by. The National Assembly. It was submitted that this amounted to saying that the whole State of Pakistan was run "under a state of no law", that is, without any legal system from the date of assumption of power by Field Martial Muhammad Ayub Khan ; and that such a sweeping proposition could not have been intended by the High Court. It was next contended-

(a) that the word "void" did not mean that a legislative instrument had no existence at all ;

(b) that where a body is invested with the power of making the Constitution of a State, then it is impossible to circumscribe its constituent powers on any general principle or theory of constitutional law. Therefore, when it makes a certain constitutional provision, in the exercise of its constituent power validating laws that is the end of the matter and the legality of that provision cannot be questioned on the basis that it does not fall within the domain of constitutional law as understood by the constitutional lawyers or writers. Hence, the void acts of .a usurper such as the impugned legislative measures could not be regard as not having been validated, once the constituent power had decided to validate them.

(29)That the High Court erred in holding that the validity of Martial Law Regulation No. 103 and Presidential Order No. 22 of 1972 was open to judicial scrutiny on the basis of the test of condonation in Asma Jilani's case. It was next submitted that these two legislative instruments had exhausted themselves by reason of the provisions of Article 295 of the Interim Constitution and Articles 264 and 266 of the 1973 Constitution. Consequently, on this test of condonation, the mill could not be revived as nothing was left to affect the previous operation of these legislative instruments or affect any right, privilege, obligation or liability acquired, accrued or incurred thereunder.

(30)That the High Court erred in holding that blanket validation given to the impugned legislative measures by Article 281(1) was merely a formal validation as by Article 280(3) of the Interim Constitution all Martial Law Regulations and Orders, specified in the 7th Schedule to the Interim Constitution, had become the acts of appropriate Legislature ; and from this the High Court drew an inference that the repealed Regulations or Orders were on no higher footing than those saved as existing laws which were subject to constitutional limitations. It was contended that this was not legally correct as those legal instruments which were saved had constitutional sanctity or at least quasi-constitutional sanctity for no Bill to amend or repeal any such instrument could be introduced or moved in the appropriate Legislature without the previous sanction of the President according to Proviso to clause (3) of Article 280 of the Interim Constitution. In this context the High Court next held erroneously that the repealed instruments could not be given any higher status than those which have been preserved as acts of the appropriate Legislature. But while holding so, the High Court did not consider the implication of the repeal of these instruments as : firstly, they were not declared to have become the acts of the appropriate Legislature ; secondly, that the repealed instruments were validated by Article 281(1) which had the effect of giving to them the status of Constitutional provisions ; thirdly, that the repeal of the Regulations and Orders was a repeal of the constitutional provisions ; and fourthly, that the repealed Regulations and Orders were constitutionally treated as existing laws. Therefore, blanket validation was given to the legislative instruments whose normative contents could not be tested by any criterion in the exercise of the powers of judicial review.

(31)That the status of these legislative instruments was of a supra-constitutional nature in the context of the proclamation of Martial Law on 25th of March, 1969, and the Provisional Constitution Order promulgated on 4th of April, 1969, as the affairs of the State would include the affairs of the defence services and all matters enumerated in the Third Schedule to the 1962 Constitution.

Accordingly, these instruments were enacted within the competent legislative field having regard to the purpose and the object to be achieved.

(32)That the High Court erred in holding that the Presidential Order No. 22 of 1972 was in the nature of delegated or subordinate legislation as this Order and the Martial Law Regulation No. 103 were enacted by the same law giver and both of them operated in their own separate fields.

Accordingly, Presidential Order No. 22 of 1972 was a legislative instrument which bore nexus to the affairs of the State and was, therefore, competently promulgated under the Provisional Constitution Order of 1969. Without prejudice to the above, it was contended that even if it be assumed that Presidential Order No. 22 of 1972 was made in pursuance of Martial Law Regulation No. 103, then this Regulation itself reserved to the Chief Martial Law Administrator and President vast powers, that is-

(a) powers to fix the terms and conditions of transfer ;

(b) power to remove difficulties ; and

(c) to give effect to the purpose of the Regulation.

It was, thus, a misnomer to say that this order went beyond the parent Regulation and that even as a subordinate legislation, it received blanket protection under Article 281(1) of the Interim Constitution and Article 269(1) of the 1973 Constitution.

(33)That the High Court was in error in holding that by coining the expression "family of promoters" and by defining "promoters" to mean Shamimur Rahman and Begum Shamim Khatoon, the Order fell outside the scope of the Regulation as these expressions were foreign to the company law.

(34)That the High Court was not justified to draw inferences of bad faith, mala fides and ulterior motives as there was -determination of the quantum and terms and conditions of compensation in the Order.

(35)That the High Court next fell into an error in drawing an adverse inference from the delay in promulgating Presidential Order No 22 of 1972, as during the interregnum the accounts and the affairs of the sugar-mill were under audit and scrutiny and it was only on the report of the Auditor received on 13th of April, 1972, that this Order was promulgated. Accordingly, by no judicial standard could an adverse inference be drawn.

(36)That it was an error to assume that discrimination was made between two sets of shareholders that is, respondent and his family members and the other shareholders in the matter of the payment of compensation for in the case of the former it was adjusted against the loan received, by them from the G. H. Q. Welfare Fund and in the case of the other it was fixed without any such deduction. It was contended that the reason for it was not far to seek as the other shareholders had not obtained any loan from the G H. Q. Welfare Fund and, therefore, this distinction was validly made in the Order.

It was next objected that the Order made a provision only for the payment of loan due to the G. H.

Q. And not for the payment of loans due to others which again was not without a reason for the money due to G. H. Q. Was a welfare money which stood on a separate footing as being public funds. Nonetheless, a provision was made in the Regulation (Martial Law Regulation No 103) itself for the discharge of these liabilities which either have been charged or are in the process of being discharged.

(38)It was submitted that the theory of seperate legal entity could not come in the way of lifting the veil of incorporation to determine the true relationship of the shareholders with regard to their dealings with the company or to ascertain the true nature of the company itself or where other considerations necessitate the taking of such steps. Accordingly, in the factual background of the case, the promulgation of Martial Law Regulation No. 103 and Presidential Order No. 22 of 1972 purportedly lifted the veil of incorporation to identify the real owners of the project, namely, the Government of Pakistan, to whom the Welfare Fund of the G. H. Q. Belonged.

(39)That the High Court was in error in holding that the object to secure G. H. Q. Welfare Fund had no nexus with any public purpose as legislation made to protect public monies is eminently for a public purpose.

(40)That the respondent was not consistent in pleading malice as a ground for the promulgation of the legislative measures. In the original petition, only malice in law was pleaded but in the respondent's "affidavit in opposition", a shift was made to apportion the blame on the appellant for feeding wrong and malicious information to the then Chief Martial Law Administrator and President which resulted in the promulgation of Martial Law Regulation No. 103 and Presidential Order No. 22 of 1972. This was not all. In the amended petition, another shift was made to impute personal malice to the law-giver, the particulars of which were stated in paragraph 5-A, sub-paragraphs (i) to (x) of the amended petition which were reproduced in full in the judgment under appeal. Sub- paragraph (0.-It was next submitted that there was no legal proof to substantiate the allegations made against late Z. A. Bhutto for compelling Inamur Rehman Alvi to donate a large sum of money to the People's Party for use in its election campaign apart from the bare statement of the respondent. Further, it was submitted that Inamur Rehman Alvi did not himself come forward to file his affidavit nor did he give evidence to support this plea in spite of the interest he took in the proceedings before the High Court. Again, there was no evidence to support the allegation that late Z. A. Bhutto challenged Inamur Rehman Alvi in a meeting held in Badin to retain the sugar-mill if People's Party came to power. Besides evidence of a speech hardly qualifies as evidence for the purpose of quashing legislative measures on the ground of bias. Sub-paragraph (ii).-It was asserted that Inamur Rehman Alvi himself did not come forward to give evidence that he was placed under house arrest but assuming it was so, without admitting the fact, this action must have been taken because of his intimate connection with the persons at the helm of affairs at the time of dismemberment of the country in consequence of the 1971 War with India in the context of the admission that he was on intimate terms with such persons. It was further submitted that there was evidence that Inamur Rehman Alvi misused his intimacy and influence to obtain substantial financial advantages including the huge loans taken from the Welfare Fund of the G. H. Q. For his wife and the respondent, his son, The misuse of the funds of the Standard Bank Ltd, is also apparent from the State Bank of Pakistan's report which speaks olumes for the "services" rendered by his family to the country.

' Sub-paragraph (iii).-It was contended that in view of the performance of Inamur Rehman Alvi's family in the financial sphere, no financial institution would have come forward to advance the huge loan of Rs. 90 lacs to the respondent and his mother without any security ; and if the then President to answer whether he would have obliged him in seeking financial assistance.

' Sub-paragraph (iv).-The allegations of the petitioner in this subparagraph are irrelevant and ought it be said that it is the only instance in which an industrial undertaking was established by loans obtained by private individuals from the G. H. Q. Welfare Fund without any security.

Furthermore, it was asserted that the assistance extended by I. C. P., N. I. T., P. I. C. I. C. And Insurance Corporation was made possible only on the intervention of the Adjutant-General, G. H. Q., who was on intimate terms with Inamur Rehman Alvi.

' Sub-paragraph (v).-It was denied that there was any defamation or villification of the character of either the respondent or his father from what Lt.-Col. (Retd.) Safdar Beg said on T. V. And in the Press Conference. On the contrary, he had only explained the public purpose behind the promulgation of Martial Law Regulation No. 103 and Presidential Order No. 22 of 1972. In any case, such a statement was no evidence of malice on the part of the person who promulgated the legislative instruments. There was also no proof of the contents of the speech as nothing was brought on record nor any witness was examined to prove it.

' Sub-paragraph (vi).-Martial Law Regulation No. 104, it was asserted, was applicable only to persons who held foreign exchange abroad in their own rights but not to persons who held such foreign exchange abroad belonging to other persons. In the instant case, Inamur Rehman Alvi acted as promoter/agent of the Rehmania Fauji Sugar Mills Ltd. And obtained a secret commission from A. W. Smith & Co. Ltd., the supplier of the sugar plant and machinery, which belonged to the Principal, that is, the company. This was not disclosed to the duly convened meeting of the Board of Directors nor to the shareholders nor even to the G. H. Q. Who had exclusive investment in the sugar-mill. This secret commission was not the property of Inamur Rehman Alvi but belonged to the company for whom he acted as an agent. Accordingly, the object in prom ulgating Foreign Exchange (Prevention of Payment) Act, 1972 and Foreign Exchange (Prevention of Payment)

(Amendment) Act, 1974, was to enable the repatriated foreign exchange to be paid to the persons to whom it really belonged. These enactments were not specifically enacted for Inamur Rehman Alvi but to cover the cases of all such persons who came within their purview It may here also be recalled that this Ordinance was challengest by Inamur Rehman Alvi in the High Court but did not succeeh One other fact which needed mention was that out of the actual commission of 199,590.20 received by him, he only repatriated to Pakistan 170,000. In the circumstances, no mala fide can be imputed to the then Chief Martial Law Administrator and President as the enactments were passed by the National Assembly which cannot be legally imputed any motive against Inamur Rehman Alvi. Lastly, in regard to the allegation that the action was taken only against Inamur Rehman Alvi under these enactments, it would suffice to say that this, by itself, could not render the legislation unconstitutional apart from the fact that the correctness of the allegations was denied and no evidence was produced by Inamur Rehman Alvi to substantiate it.

' Sub-paragraph (vii).-It was next contended that Inamur Rehman Alvi was removed from the Managing Directorship of the Standard Bank Ltd. By the State Bank of Pakistan on the basis of misconduct which removal was challenged by him in Writ Petition No. 627 of 1973 but he did not succeed as the petition was rejected by the High Court by order dated 11th of June, 1973. Again this could not be regarded as a malice against the law giver.

' Sub-paragraph (viii).-In reply to the allegations in this sub-paragraph it was contended that Presidential Order No. 22 of 1972 was a legislative measure. Therefore, no notice to the respondent or any other member of his family was required to be given prior to its promulgation. As regards the quantum of compensation, it was fixed after due enquiry and report of a reputed firm of Chartered Accountants, namely, A. F. Ferguson & Company. Further, as to the loans referred herein, suffice it to say that they were not secured and were repayable under an agreement which was onerous and procured as a result of the intimate terms of Inamur Rehman Alvi with the then Adjutant-General.

' Sub-paragraph (ix).-It was asserted that the contention was not correct as the Presidential Order No. 22 of 1972 was signed on 20th of April, 1972, and no material was brought on record to deny its correctness.

' Sub-paragraph (x).-It was submitted that the allegations in this subparagraph stood belied by the affidavit of Lt.-Genl. Gul Hassan Khan, the then Commander-in-Chief of the Pakistan Army who has specifically stated that the action in promulgating Martial Law Regulation No. 103 was taken at his instance and on his insistence.

(41) That the High Court erred in holding the new pleas of mala fides were not in substitution of the original pleas but were in addition thereto or 'in amplification of the original pleas which finding was against the settled legal position, that is, the law laid down by the Supreme Court in three cases, namely, Government of West Pakistan and another v. Begum Agha Abdul Karim Shorish Kashmiri PLD 1969 SC 14 ; The State v. Ziaur Rahman and others PLD 1973 SC 49 and The Federation of Pakistan v. Saeed Ahmad Khan and others PLD 1974 SC 151 and as for the justification of fear, it was asserted that the alleged .Fear did not prevent many other parties from pleading mala fides when late Z. A. Bhutto was in power. Therefore, this reason could not, by itself, provide a ground for a subsequent change in the stand earlier taken.

(42)' That the High Court erroneously held that the D. W. R. Was a distinct and independent body 'as it was only a branch of G. H. Q. And G. H. Q. Is an organ of the Central Government. Therefore, it did not enjoy the status of a distinct juristic person.

(43)That the High Court was in error in taking into consideration the swiftness with which the impugned legislative measures were promulgated as there was no necessity for doing so when half the country had been lost and considerable parts of Pakistan were under enemy occupation and thus imputed it to malice notwithstanding the fact that this was a matter of policy in the context of the wide spread impression that Alvi family, on account of unhealthy influence that it exercised, had manoeuvred to obtain huge Welfare Fund of the Armed Forces for their own advantage which itself was a matter of urgency as these funds needed protection. No malice can, therefore, arise from the promptitude in promulgating them.

(44)That the High Court should have directed itself to the ascertainment of the true or the dominant purpose of Martial Law Regulation No. 103 and Presidential Order No. 22 of 1972 instead of investigating the presence or otherwise of bad faith. In this behalf, it was submitted that where a person who was entrusted with power, exercises the power for the true purpose, the legality of the act should be determined by reference to the true purpose or dominant purpose ; and if it comes to light that there was legitimate purpose for the exercise of power, the presence of a concurrent illicit or subsidiary purpose would not affect the validity of the act.

(45)That the High Court failed to notice that secret commission is in the nature of a bribe, and in receiving it, without the knowledge or consent of the Principal, the agent commits a breach of duty and, accordingly, forfeits it and becomes liable to his Principal for the amount of bribe including interest. Any action, therefore, taken under the relevant enactment could not be construed as having been taken pursuant to malice where the agent involves himself in unlawfully depriving the Principal by non-disclosure.

(46)That the High Court erred in not giving effect to lathes in pleading mala fides subsequently against the law giver. Accordingly, the High Court should have denied the prayer for pleading personal malice against the law-giver.

(47)That the respondent in its letter dated 21st of June, 1972 and in the representation of Inamur Rehman Alvi to the Chief Martial Law Administrator and President no exception was taken to the validity of Martial Law Regulation No. 103 and Presidential Order No. 22 of 1972. This amounted to an implied waiver as to the validity of these legal instruments. Accordingly, the High Court should not have granted any relief on this score.

(48)That the whole transaction covered by Martial Law Regulation No. 103 and Presidential Order No. 22 of 1972, being past and closed, was protected by Article 295 of the Interim Constitution and Article 264 of the 1973 Constitution and the High Court should not have held contrary to it on the premise that it was a continuing wrong. Factually also the High Court ought to have taken into account that the appellant had discharged the liability owed to the G. H. Q. For the loan taken by the respondent and his mother from the Welfare Fund and further paid the compensation for the G.

H. Q. Shares of Rs. 25 lacs and the amount of debentures, that is, Rs. 40 lacs. Out of the liabilities standing at Rs. 8,69,31,864 the appellant paid it off except a sum of Rs. 38,91,317. All this reflected to the transaction having been accomplished under the impugned legal instruments which should have weighed with the High Court in determining the question.

(49) That even in Asma Jilani's case, it was held by the Supreme Court that the transactions which were past and closed could not be re-opened as they stood condoned. On this premise as well, the legality of the impugned instruments, which had exhausted themselves, could not be reviewed as a-reversal to the status quo ante was impossible.

(50)That the High Court was in error in striking down the legal instruments on the ground that they were void and did not exist in the eye of law but that this determination could not alter the fact that the legal instruments were promulgated and that the Court could not alter this fact. Accordingly, such a void order even if it be so classed, could create consequences and there is no hard and fast Rule that it should always be struck down whet there is no statute or principle of law which would make it unjust and inequitable.

(51)That the High Court erred in giving directions with regard to the accounting and possession of the sugar-mill and other matters for which no prayer was made in the petition and no relief could be granted under Article 201 of the Interim Constitution or Article 109 of the 1973 Constitution.

(52)That the High Court failed to consider Article 24(3)(b) under which the concept of "public purpose" and "compensation" was not applicable to the property acquired by unfair means.

Further, the adequacy or otherwise of the compensation is not justiciable under Article 24(4) of the 1973 Constitution and the High Court went wrong in adverting to it.

(53)That the High Court erred in testing Martial Law Regulation No. 103 and Presidential Order No. 22 of 1972 on the touchstone of the 1962 Constitution as that Constitution stood abrogated and the legal Order that is the Provisional Constitution Order, 1969 was subject to Martial Law Regulations. If all these instruments could be tested, the criterion could only be that they were inconsistent with or repugnant to some superior statute and none existed for such a test.

(54) That the High Court was in error to determine the constitutionality of the legislative instruments on a question of fact ascertained by it.

(55)That Article 2 of the 1962 Constitution had no bearing and that even if it be assumed that Article 2 survived, the abrogation of the 1962 Constitution, it cannot be,equated to any fundamental right as it only embodies the rule of law, that is, that the actions of every Governmental functionary should have the sanction of law. It cannot be invoked to invalidate a law but only to invalidate an action which does not have the sanction of law. It was only in this context that this Article was linked to the American "Due Process". It was next asserted that this Article and the other like Articles in the subsequent Constitutions did not confer- any fundamental right nor provide a guarantee against the abridging of right by law.

(56) That the appellant is a charitable trust which was established under the Charitable Endowments Act, 1890. Its administration is managed by the Committee of Administration and has, for its objects, - welfare measures in three separate fields :

(a) Educational stipends

(b) Medical facilities ; and

(c) Training and Rehabilitation.

' The expenditure for its welfare measures is provided from the profits generated by its fully owned industrial projects. In paragraphs 5 to 27 of the appellant's concise statement, its detailed functioning and expenditures on welfare measures has been incorporated to show that it is a welfare organization and solely wedded for providing financial assistance to the serving as well as ex-servicemen of the Armed Forces which cannot otherwise be but for the public welfare or public interest. It was next contended that it was nowhere laid down that no new law could be promulgated for acquiring the property for the benefit of a trust, devoted to the welfare of the people ; and that the power of taking or acquiring property is an amalgam of police power and the power of eminent domain such as in clause (3) of Article 13 of the 1962 Constitution ; clause (3) of Article 21 of the Interim Constitution of 1972 ; and clause (3) of Article 24 of the 1973 Constitution.

(57) That it was a misconception to assume that as the sugar-mill was not transferred to a company or co-operative society, the acquisition was made under the Land Acquisition Act notwithstanding that Martial Law Regulation No. 103 took effect irrespective of any provision to the contrary in the Companies Act or in any other law for the time being in force including the Land Acquisition Act.

(58) That the High Court erred in holding that Martial Law Regulation No. 103 and Presidential Order No. 22 of 1972 could not be given the status of law as these emanated from the person who held both legislative and executive powers, but the High Court seems to have ignored that such a combination of powers is not new to or legal system as under the various Constitutions, enforced from time to time, the executive head had been invested with law-making powers and in such cases the Courts had treated the fiat of such person as law.

(59) That the legislative instruments cannot be described as a bill of attainder for neither an offence is specified nor the guilt.. Further, such a concept is foreign to the organic law of this country and cannot be invoked on the analogy of a limitation on the legislative power such as in the American Constitution.

(60) That it is farcical to apply the natural law limitations on the law-making power of a Legislature as this doctrine is obsolete. Accordingly, such an exercise qua the impugned legislative instruments was futile.

(61) That the High Court failed to give due effect to the dictum of the Federal Court in The Punjab Province v. Malik Khizar Hayat Khan Tlwana PLD 1956 FC 200 while conceding competency qua the legislative instruments but nonetheless invalidating them on the ground of mala fides."

36. Sardar Muhammad Iqbal, learned counsel for the respondent, while supporting the conclusions of the High Court further supplemented them as under :- "(1) Rahmania Fauji Sugar Mills Ltd. Was a Public Limited Company. It was a person in law. It had a distinct and a separate entity from its shareholders and the promoters. The allegations made against the promoters, even if true, though the same are absolutely false and unfounded, could not be the basis for dissolving the company. Thus, there existed no reason whatsoever for the dissolution of the company.

(2) Article 281(1) of the 1972 Interim Constitution and Article 269(1) of the 1973 Constitution apply only to those Presidential Orders, Martial Law Regulations and Martial Law Orders which are legislative instruments or the laws.

(3) Martial Law Regulation No. 103 is not a legislative instrument or the law. The reasons are as follows :-

(a) It is established on record that an executive order had been passed much before the issuance of the impugned Regulation for dissolution of the company, to deprive it of its entire property and business, and to make Fauji Foundation owner thereof. That executive order though, later on, was dressed in the garb of "Martial Law Regulation" but would remain an executive fiat. In other words, merely because an executive fiat bears the label of "Martial Law Regulation" it does not become a legislative instrument or the law.

(b) There is tracheotomy of power. No one of the three organs of the State, i.e., Legislative, Executive and the Judiciary can, except in certain specified matters, entrench upon the field occupied by another. The "dissolution of a validly incorporated company", even if conceivable in law, is purely a judicial function. Martial Law Regulation No. 103, which has dissolved . Rahmania Fauji Sugar Mills Limited, is a legislative judgment-not Law.

(c) Martial Law Regulation No. 103 has deprived not only the company and its shareholders of their property, but all other persons who had any interest in the properties and assets of the company.

To deprive a person of his property is a punishment. In other words, it is a judicial sentence-not Law, It is like .a bill of attainder.

(d) Martial Law Regulation No. 103 has not got the generality which is the essential characteristic of "law". It is a command-not Law. A law may be made to deal with situations, places or persons, but that can only be done when they fall within .The category of a classification. Rahmania Fauji Sugar Mills Limited, a person, does not fulfil any principle of classification, i.e., it is not a class by itself.

(e) By Martial Law Regulation Na. 103 the property of Rahmania Fauji Sugar Mills Limited has been taken over from them, and bestowed upon Fauji Foundation, without any purpose whatsoever. The taking of property of one person' and giving the same to another for no avowed purpose, as is the case here, is not within the province of the Legislature. Hence, Martial Law Regulation No. 103 is not a legislative instrument or the law.

(4) Assuming, but without, in any way, conceding, that Martial Law Regulation No. 103 is a legislative instrument or law, then too the Legislature of Pakistan could not, and had, in fact, not validated the same, while enacting Article 281(1), for the following reasons :

(a) The validity given by Article 281(1) is a limited one and extends only to cure the defect of which the Legislature, at the relevant time, was conscious, i.e. The incompetency of the holder of the offices of the Chief Martial Law Administrator and the President. In other words, validation had been accorded only to his "incompetency" to legislate, that is to say, to the making of the law, and not to its contents.

(b) The Legislature undoubtedly had not examined all the, Presidential Orders, Martial Law Regulations and Martial Law Orders. It cannot, therefore, be said that the Legislature had given a blanket validity to all Presidential Orders, Martial Law Regulations and Martial Law Orders in respect of all grounds of invalidity of which the Legislature itself was neither aware nor conscious.

(c) In Pakistan, which is an Islamic State, Sovereignty belongs neither to the people as in the case of America, nor to the Parliament like the United Kingdom, but it vests absolutely and exclusively in God Almighty and is to be exercised through the chosen representatives of the people as His delegates and vicegerents. It was so provided in the Interim Constitution of 1972, and reiterated in the 1973 Constitution. As a necessary corollary, unlike the leg of a secular democracy, power of legislation in an Islamic State is not absolutely unfettered but is circumscribed by limits imposed by the immutable Divine Laws as contained in the Holy Qur'an and Sunnah. It is not open to the Legislature of an Islamic State to legalese or declare as lawful which has been forbidden in Islam.

Martial Law Regulation No. 103 is against the injunctions of Islam as laid down in the Holy Qur'an and Sunnah inasmuch as

(i) the contracts between Rahmania Fauji Sugar Mills Ltd. And (i) its shareholders ; (ii) its debenture-holders ; (iii) the Financial Institutions ; and (iv) Messrs A. W. Smith & Co., foreign suppliers of Mills Machinery etc., have been cancelled ; and

(ii) it has deprived the respondent and others of their property, without their consent, and given the same to Fauji Foundation.

The Legislature connot, therefore, be attributed the intention to have validated Martial Law Regulation. No. 103.

(d) The Legislature of Pakistan had itself declared that the National Assembly, representing the people of Pakistan, had been elected to frame for the sovereign independent State of Pakistan a Constitution wherein the principles of equity, social justice etc. As enunciated by Islam, should be fully observed. It was further provided in the Constitution that no law shall be repugnant to the teachings and requirements of Islam as set out in the Holy Qur'an and Sunnah, and all existing laws shall be brought in conformity with the Holy Qur'an and Sunnah. A representative body of persons so committed to Islam cannot be said to have validated an an-Islamic, an unjust and an immoral enactment like Martial Law Regulation No. 103.

(e) Article 281(1) has to be interpreted in the light of the "spirit" of the Constitution. The Legislature placed an embargo on its own legislative power inasmuch as it could not make a law which was repugnant to Article 3 of the 1972 Interim Constitution (which is like Article 2 of the 1962 Constitution, and Article 4 of the 1973 Constitution). It is similar to the Due Process Clause in the American Constitution. Martial Law Regulation No. 103 is repugnant to Article 3 of the 1972 Interim Constitution.

Therefore, the Legislature cannot be attributed the intention to have validated the impugned Martial Law Regulation.

(f) By Martial Law Regulation No. 103, the company was dissolved. None of the grounds as disclosed in Fauji Foundation's letters dated 21-12-1971 and 24-12-1971 pertained to the company itself, besides the same being devoid of any foundation whatsoever. Martial Law Regulation No. 103 was thus a colourable exercise of legislative power, and vitiates on the ground of malice in law. The Legislature could not intend to validate a law which had been enacted to serve collateral purposes.

(g) The facts established on record show that Martial Law Regulation No. 103 was conceived out of malice attributable to the then Chief Martial Law Administrator and the President, and the then Managing Director of Fauji Foundation. The Legislature cannot be attributed the intention to validate a legislative instrument or the law which is tainted with mala fides.

(h) Even in a secular State, to enjoy the property peacefully is recognized as a "natural right". The right of eminent domain is one belonging to a sovereignty to take private property for its own public uses, but not for those of another. Here, the respondent has been deprived of his property without any public purpose whatsoever ; the use to which it has been put after its take over being wholly immaterial. For this reason also, no Legislature would validate an enactment of such a confiscatory nature. The provisions of Article 281(1) cannot be stretched so as to validate a confiscatory legislative instrument like Martial Law Regulation No. 103.

(1) Rahmania Fauji Sugar Mills Ltd. Was a person in law. Its dissolution by Martial Law Regulation No. 103 was tantamount to killing a person. The Legislature of an Islamic State cannot be said to have validated such an enactment.

( j) Article 281 was enacted to obviate the lengthy process of condonation by the Courts, as suggested in Asma Jilani v. Government of the Punjab PLD 1972 SC 139. The validation was only as to the authority to legislate and it is to be viewed wholly in the context of Asma Jilani's case. There could be no intention to validate the laws which impaired the rights of the citizens.

(k) The literal method of construction of statutes is now completely out of date. Article 281 has to be interpreted in such a way that it should promote the general legislative purpose. Even if this Court has to read words therein to avoid absurdity and injustice, it can do so, in order to do what the Legislature would have done, had they had the situation in mind. No Legislature, let alone the one in an Islamic State, would perpetuate a wrong and a glaring injustice done to any of its citizens.

Therefore, the intention cannot be attributed to the Legislature to have validated the wrong done to the respondent and others by the promulgation of Martial Law Regulation No. 103.

(5) The late Mr. Z. A. Bhutto had taken an oath to act in accordance with law. He was, therefore, bound by the Proclamation of Martial Law and the Provisional Constitution Order, 1969. In clause (3) of the Provisional Constitution Order, 1969, it was provided that the country shall be governed as nearly as may be by the Constitution of 1962. The Chief Martial Law Administrator and the President was thus bound by Article 2 of the 1962 Constitution, and since Martial Law Regulation No. 103 is violate of the same, it is void.

(6) The Federal Legislature was competent under Item No. 13 of the Central Legislative List of the 1962-Constitution to make laws in relation to incorporation, regulation and winding up of corporations with objects not confined to one Province. The Federal Legislature had no authority to make laws for the "dissolution" of a company. "Winding up" and "Dissolution" of a company are two different concepts.

(7) Martial Law Regulation No. 103, if it is viewed as acquisition of property, was not in the sphere of Central Legislating Organ's competence. Notification (Presidential Order No. 22 of 1972)

(1) It is not a Martial Law Order, as is contended on behalf of the appellants. It is not a Presidential Order either. The Notification has been issued in the exercise of power under clause (2) of Martial Law Regulation No.

103. It is, therefore, not protected by Article 281(1) of the 1972 Constitution, or Article 269 of the 1973 Constitution.

(2) The Notification does not conform to the provisions of Martial Law Regulation No. 103 no is, transfer antrarines.

(3) There was no provision in Martial Law Regulation No. 103 in respect of the private contracts of the respondent with the Directorate of Welfare and Rehabilitation of G. If. Q. Whereas by the Noti- fication-

(a) the contract, dated 30-1-1970 concerning the loan of Rs. 90 lacs advanced by D. W. R. Of G. H. Q.

To the two Promoter-Directors has been frustrated ;

(b) the value determined for the shares was ordered to be paid to the D. W. R. For which there was no provision in Martial Law Regulation No. 103 ;

(c) though the loan was taken by the respondent and his mother, the amount due on the shares of other shareholders who were family members etc. Of the two Promoter-Directors, has been ordered to be paid to D. W. R. Of G. H. Q.

(4) It is violative of the principles of natural justice inasmuch as the President who was to determine the terms and conditions (and the "determination" implied a "decision" for which notice to the parties to be affected was necessary) gave no notice before the impugned Notification was issued.

(5) The Notification is bad in so far as the value of the company has not been determined. It is only the value of the shares which was determined, and that too it has not been determined by the President and the Chief Martial Law Administrator himself, who acted mechanically on the report, which again was procured by an interested party, viz., Fauji Foundation, which fact is manifest because Messrs A. F. Ferguson were appointed by Fauji Foundation and they too determined the break-up value, without associating the company or the respondent.

(6) The then Chief Martial Law Administrator and the President had arrogated to himself the determination of the terms and conditions of the transfer of assets and liabilities etc., of the company, meaning thereby that he had become the judge in his own cause, which was not permissible.

(7) The payment of ridiculously low price of shares of the shareholders did not satisfy the requirements of Martial Law Regulation No. 103 itself, which authorized the Chief Martial Law Administrator and the President to determine the terms and conditions of transfer of the rights, properties, assets, debts, liabilities and obligations of the company. In the case of dissolution or winding up of a company, the shareholders are entitled, in proportion to their shareholding to the remainder of the assets of the company after paying off/ discharging debts, liabilities and obligations. The method of determination of rights and liabilities conceived by the Notification issued under Martial Law Regulation No 103 goes beyond the spirit and scope of. Martial Law Regulation itself.

(8) It is bad for reasons on the basis of which Martial Law Regulation No. 103 is being challenged.

37. The above are the respective contentions of the learned counsel for the parties which converge on several topics which we are called upon to resolve. It will be also a question if it will be necessary to deal with each of them despite the efficacy of the constitutional provisions qua the validity of the impugned legislative instruments.

38. Before I advert to express my opinion on the question raised, it would be in the fitness of things to recall the legal order in the country qua the competency and legality or otherwise of Martial Law Regulation No. 103 and Presidential Order No. 22 of 1972.

39. By a proclamation, issued on the night of 25th of March, 1969, General Agha Muhammad Yahya Khan assumed the office of the President of Pakistan on its relinquishment by Field Marshal Muhammad Ayub Khan as Chief Martial Law Administrator and Supreme Commander of the Armed Forces. Simultaneously, the Chief Martial Law Administrator proclaimed Martial Law in the country and abrogated the 1962 Constitution. By such proclamation which took effect from 25th of March, 1969, the National and provincial Assemblies were dissolved and all persons holding office as. President, Members of the President's Council, Ministers, Governors of Provinces and Members of their Council of Ministers ceased to hold office with immediate effect. From amongst other provisions of the proclamation, Article 1 empowered the Chief Martial ,Law Administrator or any officer or authority empowered by him to issue Martial Law Regulations and Orders which were required to be published in such manner as was convenient. Article 5 saved existing laws and Courts and further debarred the Courts from calling in, question any Martial Law Regulation or.

Order or from issuing any writ or other process against the, then Martial Law Administrator or any person acting in exercise of any jurisdiction or power under the authority of the Chief Martial Law Administrator. On 4th of April, 1969, the President and Chief Martial Law Administrator promulgated the Provisional Constitution Order which took effect from the date of the proclamation of Martial Law. By Article 3(1) of this Order, it was provided that notwithstanding the abrogation of 1962 Constitution, the State of Pakistan would, except as otherwise provided in this. Order, be governed as nearly as may be, in accordance with the said Constitution subject to any Regulation or Order made from time to time by the Chief Martial Law Administrator. Clause (2) of Article 3 provided that the Chief Martial Law Administrator would be the President of Pakistan and shall perform all such functions assigned to the President of Pakistan by or under the said Constitution or by or under any law. Clause (3) of Article 3 abrogated paragraphs 2, 4, 5, 6, 7, 8, 9, 13, 14, 15 and 17 of the Fundamental Rights, set out in Chapter I of Part II of the 1962 Constitution and the proceedings for the enforcement of such Rights were also declared to have abated. Article 4 further declared that the Ordinance promulgated by the President or Governor of a Province would not be subject to limitations as to its duration prescribed in the 1962 Constitution and that this limitation would not also apply to any Ordinance which was enforced immediately before the proclamation of Martial Law. Article 7 provided that in case an Ordinance made under Article 4 was repugnant to any Martial Law Regulation, then the Regulation shall prevail. Article 8 gave power to the President to make such provisions by Order including constitutional provisions as he may deem fit for the administration of the affairs of the State.

40. Thereafter, on 30th of June, 1969, the Jurisdiction of Courts (Removal of Doubts) Order, 1969 (President's Order No. 3 of 1969) was promulgated to remove the doubts in regard to the jurisdiction of the Supreme Court or High Court to issue any writ, order or other process against a Special or a Summary Military Court or in relation to any proceeding in any jurisdiction exercised by any such Military Court or Martial Law authority. This order prevailed over the Provisional Constitution Order or any Martial Law Regulation or other law for the time being in force and left the question of interpretation of any Martial Law Regulation or Martial Law Order with the Martial Law authority and further gave finality to his decision.

41. On 30th of March, 1970, Legal Framework Order, 1970, was promulgated with the avowed object of electing representatives to the National and Provincial Assemblies and for the framing of Constitution by the National Assembly. Amongst its other provisions, broad outlines of the Constitution were also entrenched in it. Article 20'enacted the fundamental principles of the Constitution while Articles 21 and 22 gave the preamble of the Constitution and the directive principles. Article 2 of the order provided that it would override other laws including the Provisional Constitution Order or the 1962 Constitution or any other law.

42. As from the date of proclamation of Martial Law on 25th of March, 1969, the doctrine laid down by this Court in the case of State v. Dosso (1) held the field which, as enunciated, runs thus :- But if the revolution is victorious in the sense that the person {{FOOTNOTE}}

(1) PLD 1958 SC (Pak.) 533 ' 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."

43. The legal effect of this enunciation read with the proclamation of Martial Law, the Provisional Constitution Order and the jurisdiction of Courts (Removal of Doubts) Order, 1969, was-

(a) that the Legal Order itself became a law creating fact as its own legality could only be judged by its own success and not by the annulled 1962 Constitution. As a consequence thereto, the Chief Martial Law Administrator became the embodiment of both legislative as well as executive functions for the governance of the country.

(b) That the abrogated 1962 Constitution was adopted with the modification that the State of Pakistan was to be governed as nearly as may be in accordance with the said Constitution but subject to any Martial Law Regulation and Orders made from time to time.

(c) That in the hierarchy of statutes, the Jurisdiction of Courts (Removal of Doubts) Order, 1969, was placed higher than the Provisional Constitution Order or Martial Law Regulation or any law for the time being in force.

(d) The validity or otherwise of the Martial Law Regulation or Order was thus beyond the pale of investigation by the Superior Courts as its validity could not be tested with reference to any provision of the 1962 Constitution, the existing law or the law enacted by the President while exercising legislative functions of the Government under the adopted Constitution. The Jurisdiction of Courts (Removal of Doubts) Order, 1969, further removed all doubts as to the status of Martial law Regulations and the scope of interference by the Superior Courts qua the enforcement of Martial Law Regulation or Order in any proceeding or jurisdiction. Therefore, if the validity of the Martial Law Regulation had to be tested, then that could only be done with reference to some superior norm or legal measure, enacted by the Chief Martial Law Administrator and not the 1962 Constitution which was given a subordinate status.

44. As it happened that Malik Ghulam Jilani and Altaf Gohar were respectively detained, one at Lahore and the other at Karachi, the validity of their detentions was brought for consideration before the Lahore High Court and the High Court of Sind & Baluchistan. In both the cases, the detenus were detained under Martial Law Regulation No 78 and their petitions were dismissed on the ground that this Martial Law Regulation was immune from any challenge. In this context the correctness of the decision in Dosso's case and the validity of Martial Law Regulation No. 78 was brought for consideration before the Supreme Court in Criminal Appeals Nos. 19 of 1972 and K-2 of 1972, titled as Miss Amy Mani v. The Government of the Punjab and Mst. Zarina Gohar v. The Province of Sind and others respectively. The decision of these appeals is earlier cited as PLD 1972 SC 139.

45. This Court re-examined the legality of the Legal Order and came to the conclusion that the doctrine of "Hans Kelsen" was not only misapplied but it was also wrongly assumed that it was a generally accepted doctrine of modern jurisprudence. Accordingly, this Court held that the regime of Yahya Khan was illegitimate. Having held so, the Court further concluded that under the 1962 Constitution, which was still in force, Field Marshal Muhammad Ayub Khan had no authority to hand over power to General Agha Muhammad Yahya Khan who acted. Illegally in declaring Martial Law abrogating the Constitution, enacting new constitutional provisions ; and lastly assuming the office of the President. In its ultimate analysis, the Court held that both the Jurisdictions of Courts (Removal of Doubts) Order, 1969 (President's Order No. 3 of 1969) and Martial Law Regulation No. 78 of 1971 were enacted by a "Usurper" and hence "lacked the attribute of legitimacy which is one of the essential characteristics of a valid law". As this conclusion had a far-reaching effect, this Court next proceeded to examine as to how "many of his acts, legislative or otherwise, could be condoned or maintained notwithstanding their illegality" on the principle of condonation in the "wider public interest". The Court, however, ruled out legitimization as it was of the view that the doctrine of necessity could not be taken in aid of validating the illegal acts of a "Usurper" whose regime was illegitimate. Applying this test of condonation, the Court condoned : (I) all transactions which were past and closed as no useful purpose could be served by reopening them ; (2) all acts and legislative measures which were in accordance with or could have been made under the abrogated Constitution or the previous Legal Order ; (3) all acts which tended 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, in or case, the objectives mentioned in the Objectives Resolution of 1954". The Court, however, refused to 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. Further, no condonation was extended to an act which seriously impaired the rights of the citizens except in so far as they had for their object to advance the social welfare and national solidarity.

45-A. From what has been earlier said, it seems to me that not only the question of competency was in issue but also the validity of the acts of the Usurper. However, as the regime was illegitimate, the Court declined to use the doctrine of necessity as one for validating such acts. It was, therefore, that on the principle of condonation that a guideline was provided for testing the legislative measures.

45. Further, except for the validity of Martial Law Regulation No. 78, and Presidential Order No. 3 of 1969, no other Martial Law Regulation or legislative measure as by way of an Ordinance or Order was examined. This left a mass of legal measures whose validity was left to be determined by the Courts on the principle of condonation ; and if I may say so. It would not have been an easy task to determine in each case whether each such legal measure did satisfy the test of condonation enunciated in this case. As would appear from the judgment of Muhammad Yaqub Ali, J. (as he then was) that after the conclusion of the arguments in these appeals, the National Assembly met and unanimously expressed confidence in the Government of Mr. Bhutto, the legitimacy of which was even acknowleged by Mr, Manzoor Qadir. An Interim Constitution was in the making and it was on 17th of April, 1972, that the text of the Interim Constitution, as adopted by the National Assembly, was published on the 17th of April, 1972, while the judgment in these appeals was announced on 20th of April, 1972. The Interim Constitution received assent of the President on 21st of April, 1972. As from the nature of the proceedings in the Court, it would have been too obvious a fact not to notice, particularly when the Attorney-General was representing the Government that the Court was not apparently inclined to accept the legitimacy of the Government of General Agha Muhammad Yahya Khan ; and for that matter the effect of illegitimacy on his legislative functions.

47. It was thus that Articles 280 and 281 found place in the text of the draft published on 17th of April, 1972, and so also the expression "notwithstanding any judgment of any Court" in the latter section.

The introduction of Articles 280 and 281 in the Interim Constitution, before the judgment in these appeals was announced, could not be but for the reason to overcome the legal impasse caused by improper legislation. Muhammad Yaqub Ali, J. (as he then was), while reproducing these Articles in his judgment, expressed his opinion on their efficacy as under. The intended effect of these constitutional provisions is that among other Martial Law Regulations and Orders, Martial Law Regulation 78 and Jurisdiction of Courts (Removal of Doubts) Order 3 of 1969 will be deemed to have been validly made, but this is so not because Yahya Khan was competent in law to promulgate these laws. They are valid, because the new Constitution of the State adopts them as constituents of the National Legal Order as from the commencing day, i.e. 21st April, 1972, with retrospective effect from the 25th March, 1969. In the words of Kelsen If laws which were introduced under the old Constitution continue to be valid under the new Constitution this is possible only because validity has expressly or tacitly been vested in them by the new Constitution. The phenomenon is a case of reception. The laws which, in the ordinary inaccurate parlance, continue to be valid are, from a Juristic viewpoint, new laws whose import coincides with that of the old laws.

They are not identical with the old laws, because the reason for their validity is different."

47. Lastly, one other matter needs elucidation, which is, as to what was the fate of the 1962 Constitution upon the enactment of the Interim Constitution ? In State v. Ziaur Rahman (1), decided on 8th of January, 1973, an argument was raised that consequent upon the declaration in Asma Jilani's case that the regime of General Agha Muhammad Yahya Khan was that of a usurper, the Constitution of 1962 held the field and that the National Assembly, as constituted, could not frame the Constitution. This submission was firmly repelled and it was unequivocally held that the Interim Constitution was a valid document as it had been enacted in exercise of the mandate given to it by the people in terms of the Legal Framework Order, the validity of which was conceded in Asma' Jilani's case ; and as the Interim Constitution was framed, it had impliedly repealed the 1962 Constitution. The Legal Framework Order also spent itself out on the framing of the Interim Constitution by the National Assembly. The Interim Constitution became the fundamental law of Pakistan and all the State functionaries owed their origin to it and derived their powers from it. The Interim Constitution of 1972 was repealed on the promulgation of the Constitution of the Islamic Republic of Pakistan on 14th of August, 1973.

49. I felt it necessary to highlight all this to show to what extent there was scope for testing the validity of Martial Law Regulation No. 103 and Presidential Order No. 22 of 1972 with reference to the requirement of 1962 Constitution at a time when it stood impliedly repealed. This now completes the constitutional framework of the country at a time when the petition was filed (11th of August, 1973) and decided by the High Court (10th of April, 1980).

50. As ultimately the fate of the appeals primarily hinges on the efficacy of Articles 280, 281 and 296 of the Interim Constitution and Articles 266, 269(1) and 270 of the 1973 Constitution, it would be appropriate here to reproduce them :- Interim Constitution

280. Continuance in force of certain laws and repeal of other laws.-(1) Except as provided by this Article, all existing laws shall, subject to this Constitution, continue in force, so far as applicable and with the necessary adaptations, until altered, repealed or amended by the appropriate Legislature.

(2) The Proclamation made on the twenty-fifth day of March, 1969, is revoked with effect as from the commencing day, and the Orders specified in the Sixth Schedule and any Orders amending those Orders are repealed with effect as from that day, but this clause shall not affect any existing laws made under those Orders.

(3) All Martial Law Regulations and Martial Law Orders, except the Martial Law Orders specified in the Seventh Schedule are repealed with effect from the commencing day, and on that day each Martial Law Regulation and Martial Law Orders so specified shall be deemed to have become an Act of the appropriate Legislature and shall, with the necessary adaptations, have effect as such : Provided that no Bill to amend or repeal any of the Martial Law Regulations or the Martial Law Orders specified as aforesaid shall be introduced or moved without the previous sanction of the President.

(2) For the purpose of bringing the provisions of any existing law into accord with the provisions of this Constitution (other than Part H of this Constitution), the President may make, by Order, such adaptations, whether by way of modification, addition or omission, as he may deem to be necessary or expedient, and any Order so made shall have effect (or be deemed to have had effect) from such date not being a date earlier than the commencing day, as may be specified in the Order.

(3) The President may authorise the Governor of a Province to exercise in relation to the Province, the powers conferred on the.

' President by clause (4) in respect of laws relating to matters with respect to which the Provincial Legislature had power to make laws.

(6) The powers exerciseable under clauses (4) and (5) shall be subject to the provisions of any Act of the appropriate Legislature.

(7) Any Court, tribunal or authority required or empowered to enforce an existing law shall, notwithstanding that no actual adaptations have been made in such law by an Order made under clause (4) or clause (5), construe the law with all such adaptations as are necessary to bring it into accord with the provisions of this Constitution.

(8) In this Article, "existing laws" means all laws (including. Ordinances, Orders-in-Council, Orders, Rules, Bye-laws, Regulations and Letters Patent constituting a High Court, and -any notifications and other legal instruments having the force of lawl in force in Pakistan or any part of Pakistan, or having extra-territorial validity, immediately before the commencing day.

281. Validation of laws and acts, etc.-(1) All Proclamations, President's Orders, Martial Law Regulations, Martial Law Orders, and all other laws made as from the twenty-fifth day of March, 1969, are hereby declared, notwithstanding any judgment of any Court, to have been validly made by competent authority, and shall not be called in question in any Court.

(2) All' orders made, proceedings taken and acts done by any authority, or by any person, which were made, taken or purported to have been done, or made, taken or done, on or after the twenty- fifth day of March, 1969, in exercise of the powers derived from any President's Orders, Martial Law Regulations, Martial Law Orders, enactments, notifications, rules, orders or bye-laws, or in execution of any orders made or sentences passed by any authority in the exercise or purported exercise of powers as aforesaid, shall. Be deemed to be and always to have been validly made, taken or done.

(3) No suit or other legal proceedings shall lie in any Court against any authority or any person for or on account of or in respect of any order made, proceedings taken or act done, whether in the exercise or purported exercise of powers referred to in clause (2), or in execution of or in compliance with orders made or sentences passed in exercise or purported exercise of such powers (as amended by the Constitution Sixth Amendment Order, 1973, promulgated on 3rd of April, 1973, President's Order No. 3 of 1973).

295. Effect of repeal of law-Where a law (including a President's Order, a Martial Law Regulation or a Martial Law Order) is repealed, or is deemed to have been repealed, by, under, or by virtue of this Constitution, the repeal shall not, except as otherwise provided in this Constitution-

(a) revive anything not in force or existing at the time at which the repeal takes effect ;

(b) affect the previous operation of the law or anything duly done or suffered under the law :

(c) affect any right, privilege, obligation or liability acquired, accrued or incurred under the law ;

(d) affect any penalty, forfeiture or punishment incurred in respect of any offence committed against the law ; or

(e) affect any investigation, legal proceeding or remedy in respect of any such right, privilege, obligation, liability, penalty, forfeiture or punishment ; or

(f) affect the continuance of any body or authority constituted by or under such law ; and any such investigation, legal proceeding or remedy may be instituted, continued or enforced, and any such penalty, forfeiture or punishment may be imposed, and such body or authority continued as if the law had not been repealed. Permanent Constitution

266. The Interim Constitution of the Islamic Republic of Pakistan together with the Acts and President's Orders making omissions from, additions to modifications of, or amendments in, that Constitution is hereby repealed.

269.-(1) All Proclamations, President's Orders, Martial Law Regulations, Martial Law Orders and all other laws made between the twentieth day of December, one thousand nine hundred and seventy-one and the twentieth day of April, one thousand nine hundred and seventy-two (both days inclusive), are hereby declared, notwithstanding any judgment of any Court, to have been validly made by competent authority and shall not be called in question in any Court on any ground whatsoever.

(2) MI orders made, proceedings taken and acts done by any authority, or by any person, which were made, taken or done, or purported to have been made, taken or done, between the twentieth day of December, one thousand nine hundred and seventy-one, and the twentieth day of April, one thousand nine hundred and seventy-two (both days inclusive), in exercise of the powers derived from any President's Orders, Martial Law Regulations, Martial Law Orders, enactments, notifications, rules orders or bye-laws, or in execution of any orders made or sentences passed by any authority in the exercise or purported exercise of powers as aforesaid, shall, notwithstanding any judgment of any Court, be deemed to be and always to have been validly made, taken or done and shall not be called in question in any Court on any ground whatsoever.

(3) No suit or other legal proceedings shall lie in any Court against any authority or any person for or on account of or in respect of any order made, proceedings taken or act done whether in the exercise or purported exercise of the powers referred to in clause (2) or in execution of or in compliance with orders made or sentences passed in exercise or purported exercise of such powers.

270.-{l) Parliament may by law made in the manner prescribed for a matter in Part I of the Federal Legislative List validate all Proclamations, President's Orders, Martial Law Regulations, Martial Law Orders and other laws made between the twenty-fifth day of March, one thousand nine hundred and sixty-nine, and the nineteenth day of December, one thousand nine hundred and seventy-one (both days inclusive).

(2) Notwithstanding a judgment of any Court, a law made by Parliament under clause (1) shall not be questioned in any Court on any ground, whatsoever.

(3) Notwithstanding the provisions of clause (1), and a judgment of any Court to the contrary for a period of two years from the commencing day, the validity of all such instruments as are referred to in clause (1) shall not be called in question before any Court on any ground whatsoever.

(4) All orders made, proceedings taken, and acts done by any authority or any person, which were made, taken or done, or purported to have been made, taken or done, between the twenty-fifth day of March, one thousand nine hundred and sixty-nine, and nineteenth day of December, one thousand nine hundred and seventy-one (both days inclusive), in exercise of powers derived from any President's Orders, Martial Law Regulations, Martial Law Orders, enactments, notifications, rules, orders or bye-laws, or in execution of any order made or sentence passed by any authority in the exercise or purported exercise of power as aforesaid shall, notwithstanding any judgment of any Court, be deemed to be and always to have been validly made, taken or done, so however that any such order, proceeding or act may be declared invalid by Parliament at any time within a period of two years from the commencing day by resolution of both Houses, or in case of disagreement between the two Houses, by such resolution passed at a joint sitting and shall not be called in question before any Court on any ground, whatsoever.

51. One consideration which also requires to be highlighted is as to the efficacy of the fundamental rights entrenched in the Constitution. Here it can be recalled that the emergency proclaimed by General Agha Muhammad Yahya Khan as President of Pakistan on the 23rd of November, 1971, was kept alive under Article 280 of the 1973 Constitution by President's Order dated 15th of August, 1973, and the enforcement of the fundamental rights provided for in Articles 10, 15, 16, 17, 18, 19, 23, 24, 25 and 27 was suspended ; but by a subsequent Order dated 4th of August, 1974, this Order was rescinded. On the Proclamation of Martial Law in July, 1977, the fundamental rights were again suspended under Article 2(3) of the Laws (Continuance in Force) Order, 1977, promulgated on 5th of. July, 1977, and such suspension was held to be valid by this Court in the case of Begum Nusrat Bhutto v. The Chief of Army Staff and Federation of Pakistan (1).

52. Before I proceed to examine the major points, I would like, to dispose of the opinion of the High Court as to the meaning of the expression "subject to all just exceptions". The grievance of the first appellant was that in the original petition, only malice in law was pleaded and by the subsequent amendment in the petition, personal malice was attempted to be substituted which, to all intents and purposes, was a new cause of action which could not be agitated by this belated prayer. On 28th of February, 1978, another Bench of the High Court allowed the amendment application on condition, that is, "subject' to all just' exceptions" which was construed by the High Court subsequently to mean that this order itself could not be reviewed ; and all that it meant was "that the allegations in the application for amendment and the facts sought to be pleaded, are not to be taken as having been accepted by the other side to remain at liberty to challenge the same".

Patently, the, counsel for the appellants contended that this was a conditional order and, left open the entire question as to the propriety of the amendment in all its facets. This appears to be a substantial objection qua the maintainability of the subsequent amendment application. The High Court while construing this expression merely confined itself, for holding so, on Order VI, rule 17, C. P.

C. In this behalf, the High Court observed :- "It is undeniable that amendment can be applied for under Order VI, rule 17, C. P. C. At any stage of the proceedings and such right cannot be curtailed. The power to permit amendment is discretionary with the Court within the limits of judicial principles. The amendment is to be allowed where the applicant had acted in good faith, but refused where it was mala fide. Amendment is not allowed where the effect would be to change the very character of the petition or result in the substitution of the cause of action. The power to grant amendment, being procedural, is to be used for the purpose of furthering the ends of justice. If found just and necessary, the Court may not hesitate in even allowing alternate and inconsistent pleas by way of amendment."

' The considerations laid down above, for the exercise of discretion in favour of granting the relief of amendment, could only assume importance if the other side was unable to convince the Court as to the non-maintainability of the application ; and that was the question before the Court particularly when it was a belated application and the father of the respondent, who being the victim of malice, was neither a party in the petition nor did he file an affidavit in support of the application coupled with the more serious lacuna that the law-giver, who was imputed to have acted mala fide in promulgating the legislative measures, was not impleaded in the proceedings as it was he who could have properly denied the allegations.

53. Surely such an expression must have some definite connotation when, as a matter of an age long practice, the Courts in Pakistan have been using it while disposing of interlocutory applications, such as those relating to the substitution of legal representatives, amendment of pleadings and those dealing with other procedural technicalities more generally ex parte or even in the presence of the other side. It is this connotation which requires an explanation. If it means to dispose of an issue finally in all its facets, then it does not satisfy the requirement of an expression of an opinion on merits by the High Court. Nonetheless, the High Court has taken it to be final so as not to be reviewable. How this result flowed from it, I have not been able to discern either from the meaning of the words used or on any general principle. Recently this expression was construed by this Court in Ghulam Muhammad and another v. Irshad Ahmad and another

(1) and explained as under is not denied by the learned counsel for the appellants that one of the well-known meanings of the phrase 'subject to all just exceptions' is that the order which contains this expression, would be effective unless and until the other party who would be affected such an order takes exception to it and raises objections which are ultimately upheld to be just and valid.

We have earlier, in this judgment, reproduced the order passed by this Court on 19th of January, 1976. ' The use of the expression 'subject to all just exceptions' in the last but one paragraph of the order was in this very sense."

' The word "subject" takes out from the expression the element of finality once an objection is taken to the order. Eminently, therefore, the objection as to the maintainability of the application could not be taken out of the ambit of the words "just and valid" as such an objection goes-to the root of the matter and, accordingly, the application was allowed subject to it. The connotation of the expression, as would appear from the above dictum of this Court must be regarded as to have been understoodkin that sense by the Courts and ought it be said that such connotation, by its long usage, fell as a fortiori within the well-known concept of the rule of stare decisis. There fore, the High Court patently fell into an error in holding that the order could not be reviewed and, thereby, curtailed the right of the first appellant to challenge the maintainability of the application for reasons such as those highlighted hereinabove. Such denial of right could not be lightly condone but for the fact that as the High Court has dealt with the subject of mala fide and held it to have been established, it is, accordingly, necessary to examine it despite its erroneous opinion that the order was not reviewable.

54. While commenting on this topic, the High Court has enumerated these allegations in paras. (i) to (x) at pages 384, 385 and 386 of the Report (PLD 1980 Kar. 345) which have also been reproduced in extenso in para. 29 of this judgment. It would here be necessary to give an inkling of the background in which the amendment application was moved. In the High Court, on behalf of the first appellant herein, Maj.-Gen. (Retd.) Muhammad Nawaz Matik, Managing Director of Fauji Foundation and Chairman of the Mill and Lt.-Col. (Retd.) Muhammad Safdar Beg, Industries Director, filed their affidavits on 12th of October, 1973, to rebut the allegations levelled in the petition.

The respondent herein and one Lt.-Col. Muhammad Ehsanul Haq filed their affidavits in rejoinder.

The case of the Fauji Foundation, as projected through the two affidavits which of course also included the denial of the plea of malice in law was that on the initiative and with the active assistance of the G.H.Q., the respondent -undertook the establishment of the Mills for the benefit of the soldiers, settled in the area. In the process the Welfare Funds of the Army were funnelled in the Mills through the sponsoring Directors (to the tune of Rs. 90 lacs), through the debentures (40 lacs) and by way of shares (25 lacs) apart from the help rendered in obtaining other loans. The terms of the loans, advances etc. Were prejudicial to the welfare funds and the commitments made were not honoured by the respondent, the sponsoring Director, and the mill which necessitated State action. Various proposals were examined by the then President and Chief Martial Law Administrator on the 23rd of December, 1971, and a decision was taken which led to the promulgation of M. L. R.

103.

55. On the 27th November, 1977, the respondent filed an application under Order VI, rule 17 read with section 151, C. P. C. Seeking permission to amend the constitutional petition with a view to take the additional ground that Martial Law Regulation No. 103 was vitiated on account of personal mala fides and lack of good faith on the part of Mr. Z. A. Bhutto, the then President and Chief Martial Law Administrator. Malice was particularized in this judgment.

56. Lt.-Col. (Retd.) Salahuddin, a Resident Director of the Fauji Foundation filed affidavits to repudiate the grounds on which the amendments were sought specifically pleading that "the petitioner taking undue advantage of the changed circumstances has come out with wild allegations against the then President Mr. Z. A. Bhutto knowing fully well that he is not a party to the petition to defend himself.

57. As alluded earlier after notice to the appellants on 28th of February, 1978, the application for amendment was "allowed subject to all just exceptions". The respondent was asked to file amended petition within two weeks which he did on 13th of March, 1978.

58. On 30th of September, 1979, another application was presented on behalf of the respondent, requesting the Court "to direct the respondent No. 1 to place before the Court the complete file pertaining to the circumstances under which the inquiry, as alleged by the Fauji Foundation in relation to the Rehmania Fauji Sugar Mills, started on the 22nd of December, 1971, culminating in the passing of M. L. R. 103 of 1971". The application came up before the High Court on 7th of October, 1979, when the following order was recorded :- "Learned Deputy Attorney-General has no objection to the grant of this application. Accordingly, this application is granted as prayed for and the Deputy Attorney-General is directed to make available with him the necessary record as requested in the application."

On 24th October, 1979, the Deputy Attorney-General reported to the Court that the record asked for "had not been traced out yet, and, therefore, he was unable to produce the same." On the same date, the Fauji Foundation, however, made available the minutes of the meeting held on 23rd of December, 1971, when the decision to issue the legislative instrument was taken.

56. As regards the personal mala fides of late Z. A. Bhutto, after reproducing, in extenso, the relevant paras. Of the petition and noticing his absence as a party, the High Court held that "except for the allegation regarding the making of speech by Mr. Z. A. Bhutto, during the election. Campaign of 1970, the other grounds were directed against him in his official capacity as the President and the Chief Martial Law Administrator." The non-production of file referred to was held to reflect adversely. The learned Judges felt astonished "that in the midst of these traumatic events the President and the Chief Martial Law Administrator should have thought of the trivial issue of winding up of a company." The High Court concluded thus :- . . The irresistible conclusion reached by me, in the circumstances, is that the idea of making the Regulation was conceived in the course of a private discourse, and a Regulation adopted in the meeting was issued in the form of a Regulation. It was passed in colourable exercise of legislative power for a collateral purpose. The facts and attending circumstances, taken together, also support the contention of the petitioner that the impugned Regulation was discriminatory in nature."

56. As will appear from the above, the second appellant had not filed any counter-affidavit to the amended petition to controvert the allegations of mala fides while the first appellant had oenerally denied the allegations ill the affidavit filed on its behalf. The High Court, in the first instance draw an adverse inference as stated earlier ; and secondly, it took exception to the production of the file by the first appellant containing the documents which gave out the minutes of the meeting held on 23rd of December, 1971, as in its opinion it was not produced from proper custody. The High Court, accordingly, held :- . . . The relevant file showing the formalities and the making of the Regulation was not produced and yet more disturbing is the fact that the file containing the minutes of the meeting held on 23rd of December, 1971, in the President's office had come from the record of the second respondent which is an interested party. These facts indeed go a long way to support the petitioner's allegation that the Regulation was in fact an executive fiat and not a legislative instrument."

61. While commenting on the minutes of the meeting, the High Court took exception to the absence from the minutes a reference to the huge advances made to the company by several other financial institutions, namely, PICIC, NIT, ICP and National and Grindlays Bank Ltd., London Branch; and what next noteworthy was, in its opinion, that the name of Inamur Rahman and his family alone was given prominence and the further fact that there was no such hurry for taking action as was initiated for issuing the impugned legislative instrument just three days after his assumption of office as President and Chief Martial Law Administrator in the wake of the aftermath of the war of 1971.

62. On the merits of the mala fides alleged, the High Court accepted the contention of the counsel for the respondent that judicial notice should also be taken of "other contemporaneous incriminating actions" taken against Mr. Inamur Rahman such as of singling him out for action under Martial Law Regulation No. 104 in that his repatriated amount was frozen by the State Bank at the instance of the Federal Government ; and that the first appellant stood to gain by the enabling provision of that Regulation which entitled the first appellant to claim it. The other feature noticed was that Inamur Rahman was put under house arrest alongwith other high ranking military officers at about the time the impugned legislative instrument was promulgated ; and after recalling some basic facts regarding the inception of the mill, which the High Court took them to be admitted facts, held that the loan of Rs. 90 lacs was voluntarily advanced to the sponsoring Directors in business like manner as fully securing their interest which partook the nature of an independent transaction and the sponsoring Directors, in the circumstances, were free to use the amount of loans in any manner they liked, laying at the same time further emphasis on the fact that no complaint was ever made by the Director, Welfare and Rehabilitation, that the loan was insecure.

Not only this, the High Court was further impressed by the fact that the promoters of the company had well utilised the funds and successfully established the sugar mill which had gone into production before the promulgation of the impugned legislative instrument. In this context the High Court referred to the fact that an amount of Rs. 5,40,000 was paid on 17th of December, 1971, to the Welfare Directorate as interest on the loan advanced by it.

63. The High Court, while dealing with the substitution of the allegations from "mala fides in fact" to "mala fides in law", held that even in the original petition those allegations were made in a subdued form and that in fact the subsequent allegations were in amplification of the allegations of mala fides already pleaded.

64. As for the delay in filing the belated application, the explanation of the respondent was that he could not muster courage against late Z. A. Bhutto until such time as he remained in power for the fear of punitive measures being taken against him as were taken against other persons and highlighted in the White Papers issued by the Government. The High Court held that it did not feel it necessary to be drawn into any controversial issue as circumstances justified the passing of such order by another Division Bench, which was not reviewable.

65. The High Court seems to have taken into consideration factors such as adverse inference, pleadings, assertions, production of minutes of meeting by the first appellant, some disputed questions of fact on the premise as being admitted and judicial notice of the actions taken against Inamur Rahman as proof sufficient to establish bad faith. Now, the law as to the pleadings and proof of mala fides is summed up in Federation of Pakistan v. Saeed Ahmad Khan (1). Hamoodur Rehman, C. J., while dealing with the subject held : "Mala fides is one of the most difficult things to prove and the onus is entirely upon the person alleging mala fides to establish it, because, there is to start with, a presumption of regularity with regard to all official acts, and until that presumption is rebutted, the action cannot be challenged merely upon a vague allegation of mala fides."

Commenting further, he observed :- " Mala fides literally means 'in bad faith'. Action taken in bad faith is usually action taken maliciously in fact, that is to say, in which the person taking action does so out of personal motive either to hurt the person against whom the action is taken or to benefit oneself. " - It was next held that the specific allegations are a must which should be supported by some prima facie proof to justify the Court to call upon the other.Side to produce evidence in its possession. Accordingly, the High Court's assessment of the factors as enumerated above will have to be tested in the light of the principle laid down in Saeed Ahmad's case, both on facts and law. Adverse Inference

64. I would first deal with its legal aspect. The High Court, as stated above, has drawn an adverse inference apparently under section 114 of the Evidence Act on the analogy of an act of a functionary from the failure on the part of the counsel for the second appellant to produce the relevant file which in its opinion was intentionally withheld. Could the High Court legally draw such an inference of fact in regard to legislative motives such as malice? In doing so the High Court has not cited any precedent nor any principle for drawing such an inference. As I see the problem, it involves the scope of judicial review as in the exercise of drawing an inference, the High Court has purportedly over-reached the legislative field as if it had superior judicial power to examine the proceedings/ material leading to the passage of the impugned legislative instrument.- This question is of fundamental importance as it involves the disturbance of the functional boundaries of the organs of the. State. Cornelius, C. J., in Tariq Transport Co. v.

Sargodha-Bhera Bus Service (2), while expounding he scope of judicial review expressed strongly against the disturbance of the division of powers and held as under :- "It is in that sense that the Courts of the country from which originate, not only the writs in question, but also the whole conception of separation of the legislative, judicial and executive functions, have confined their interference with executive actions by the writs in question to matters involving processes which are either expressly judicial, or analogous to the judicial process. The division of functions between the three limbs of the State in Pakistan is by no means less clear than it is in England. To observe and to respect this division is implicit under the duty of loyalty to the Constitution which rests upon all citizens but is particular upon those who are entrusted with the duty of interpreting and implementing the Constitution."

67. Again in regard to the respective powers of the organs of the State, Hamoodur Reman, C. J., in State v. Ziaur Rehman (1), observed thus : "In all such cases, it will also be the function of the constitution to define the function of each organ or each branch of an organ, as also specify the territories in which, the subjects in respect of which and sometimes even the circumstances in which these functions will be exercised by each of these organs or sub-organs. Limitations would, therefore, be inherent under such a system so that one organ or sub-organ may not encroach upon the legitimate field of the other. Thus, under a written Constitution, the. Legislature of a federal unit will not be able to legislate in respect of a subject which is within the field of the federal Legislature, nor will a federal Legislature be able to legislate upon a subject which is within the exclusive field of the Legislature of the federating units. It cannot, therefore, be said that a Legislature,, under a written Constitution, possessed the same powers of 'omnipotence' as the British Parliament. Its powers have necessarily to be derived from, and to be circumscribed within the for corners of the written Constitution. "

' Therefore, when a Court, which is a creature of the Constitute itself, examines the vires of an Act, its powers are limited to examining the legislative competence or to such other limitations as are in the Constitution ; and while declaring a legislative instrument as void, "it I not because the judicial power is superior in degree or dignity to the legislative power" but because it enforces the Constitution as a paramoun law either where a legislative instrument is in conflict with the Constitutional provision so as to give effect to it or where the Legislature fails to keep within its constitutional limits.

67.

68. Clearly, therefore, the scope of judicial review is confined to the enforcement of the Constitution as supreme law. Aside from the inherent prerogative to interpret the Constitution, its purpose is corrective or G directory, and extends to determining the legality of an administrative action and in relation thereto the constitutionality of the legislation. It, however, does not extend to prying into the affairs of the Legislature. This exertion of power in the garb of judicial review can be equated with that-exercised by the English Courts over administrative actions with the singular istinction that as the Parliament is sovereign, the English Courts feel them.. Selves bound by the legislation and are only concerned with its enforcement. In this background, as it is, an identical question had arisen before the English Courts as to whether the legislative motives can be enquired into, which I consider in substance to be a political question. I will presently refer to those cases.

69. In England, the Parliament is above the Constitution and with it rests practically the sovereignty of the country so that it can exercise all the powers of the Goverarnent if it wills to do. Accordingly, the English Courts follow the principle that they are not concerned as to how the legislative instrument was brought into force. In Edinburgh & Delkeith Railway Company v. Wauchope (1) at p.

724, it was observed : "All that the Court of justice can do is to look at the Parliamentary Roll ; if from that it should appear that a bill has passed both houses and received the Royal'Assent, no Court of justice can enquire into the mode in which it was introduced into Parliament nor into what was done previous to its introduction, what passed in Parliament, during its progress in its various stages to both houses."

Willes, J. In Lee v. Bude.& Torrington Junction Railway Co. (2) said :- "Are we to act as regents over what is done by Parliament with the consent of the. Queen, lords and commons ? I deny that any such authority exists. If an Act of Parliament has been obtained improperly, it is for the Legislature to correct it by repealing it, but, so long as it exists as law, the Courts are bound to obey it. The proceedings here are judicial, not autocratic, which they would be if we could make laws instead of administering them." .

Lord Atkinson, in Hollinshead v. Hazleton (3), recounted this principle in the following words "It is well established that in a Court of Law the motives which influenced the Legislature in passing any particular enactment, or the purposes or objects it desired to effect, can only be legitimately ascertained from the language of the enactment itself viewed through the light of the circumstances in reference to which the language was used ; see Lord Blackburn's judgment in River Wear Commissioners v. Adamson (1877) 2 A C 743. The reports of the debates leading up to the passing of it cannot be looked at. The same rule of construction must, I think, be applied to the resolutions passed by either House of. Parliament. When these motives purposes, or objects are not, expressly or itnpliedly, revealed in language of the Legislature in its .Statute, or by either of the Houses of Parliament in that of its - resolutions so viewed, it is, I think, wholly illegitimate to surmise :or conjecture what these unrevealed motives, purposes or objects may have been and to construe and apply the statute or resolutions as if they had been indicated."

' In British Railway Board v. Pickin (4) this principle was accepted with greater clarity and it was held by the House of Lords that the Courts bad no power to disregard an Act of Parliament, Whether public or private, {{FOOTNOTE}}

(1) 8 E R. 279=(1842) 8 Cl & F.710 (2) .(1871).L R 6 C P 576

(3) (1916) A C 424 (4) (1974) 1 All E R 609 nor had they any power to examine proceedings in Parliament in order to determine whether the passing of an Act had been obtained by means of any irregularity or fraud.

70. The bar qua the vires of the statute is founded on the principle that as there is no legal limit upon the legislative supremacy of Parliament, the British tradition has been strongly against the Courts having power to review the validity of an Act of Parliament except, of course, examining the authentication of the Bill by both the Houses of the Parliament for determining whether the legislative document is in law an Act of Parliament. Recently an exception to this rule is provided by Anisminic case (1), in which the House of Lords has gone to the extent of contradicting the express provision of an Act by extending the scope of ultra vires under the guise of statutory interpretation as against its own decision reported as Smith v. East Elloe Rural District Council (2). In "Legal Control of Government" the authors (Bernard Schwartz and H. W. R. Wade) (1972) Edn., pp. 296-300), have described this exercise as 'a high water mark what Americans call aggressive judicial review' ; and that it is the "House of Lords' dramatic exploit", which "leaves some big questions unanswered". The decision in this case rests on statutory interpretation reflecting a judicial mood different from the one 20 years ago. Nevertheless the legislative supremacy of the Parliament is not shaken and still exists with the limitation on the Courts' power to overeach its legislative sphere. If at all there is any such defect in the legislation, they hold that it is for the Parliament to modify, amend or repeal the legislation.

71. Under the American Constitution by reason of the "due process of law" clause entrenched therein all laws become subject to judicial review, but the Courts do not suo motu review any act of the Congress. They do so and declare the legislation void as an incident to performance of their regular functions of adjudication. However, as the powers are enumerated in the American Constitution the Courts are not inclined to transcend the limits so as to interfere with the discretion exercised by the Congress in enacting laws. In the words of William 0. Douglas, in his book captioned "We the Judges" at p. 151, the principle of non-interference is thus, stated : "The practical bounds of legitimate inquiry are determined not so much by legal rules but by the respect that one department has for the other. The American political creed rests on the sovereignty of goodwill. The departments by and large operate with high respect for the other's functions."

' This principle is clearly di scernible from the following cases decided by the Supreme Court of America, where judicial power was not exerted to encroach the domain of the legislative department.

71-A. In Henry Amy v. The City of Watertown (3), the Supreme Court of United States held "With motives we have nothing to do. Certainly, improper motives cannot be attributed to a State '

Legislature in the passage of any law for the Government of the State."

' In United States v. The Dee Moines. Navigation and Railway Company (4), it was held : "The knowledge and good faith of a Legislature are not open {{FOOTNOTE}}

(1) (1969) 2 A C 14 (2) (1956) A C 736

(3) (130) U.S 301 (4) U S 142 510 to question. It is conclusively presumed that a Legislature acts with full knowledge and in good faith. In Lawrence Weber v. Frederick S. Freed (1), it was observed :- "Moreover, the proposition plainly is wanting in merit, since it rests upon the erroneous assumption that the motive of Congress in exerting its plenary power may be taken into view for the purpose of refusing to give effect to such power when exercised."

' In Elwood Hamilton v. Kentucky Distilleries (2), it was firmly concluded thus : "No principle of constitutional law is more firmly established thin that this Court may not, in passing upon the validity of a statute, enquire into the motives of Congress". "Nor may it pass upon the necessity for the exercise of a power possessed, since the possible abuse of power is not an argument against its existence". In somewhat similar terms. Gibson, J. In Eakin v. Kaub (Constitutional Interpretation by Harold W. Chase, 2nd Edn., p. 24), gave his own analysis, while dealing with the power of the Pennsylvania Supreme Court to invalidate a State law, and so much of it as is relevant here is reproduced thus :- ' But it has been said to be emphatically the business of the judiciary to ascertain and pronounce what the law is, and that this necessarily involves a consideration of the Constitution. It does so but how far. If the judiciary will enquire into anything beside the form of enactment, where shall it stop ?

There must be some point of limitation to such an inquiry for no one will pretend, that a Judge would be justifiable in calling for the election returns, or scrutinizing the qualifications of those who composed the Legislature."

' From the analysis in the manner it is summed, it visualizes the difficulty of the exertion, of judicial power to resolve political questions, such as the reviewing of election returns or the competency of the Legislature, which are now established not to be justiciable controversies.

72. From the review of cases it becomes abundantly clear that both in America and England, the Courts refrain from exerting an inquiry into the motives of the legislation and the same legal position obtains here because of the inherent limitation on the judicial power not to encroach upon the legislative field. If an inquiry involving proof is outside its scope then how can a presumption be drawn and that too one of fact such as malice.

72. It will be interesting here to refer to a judgment of the Federal Court covering the point which is reported as Umayal Achi v. Lakshmi Achi (3). In this case the court was called upon to presume that the Hindu Women Rights to Property Act, 1937, was not validly enacted as the Council of State had never agreed to the same Bill as originally passed by the Legislative Assembly. ' In holding against this proposition Varadachariar, J., observed :- "Dealing with the last mentioned argument first, in my opinion, when a Court ascertains that a Bill has in fact been passed by both Chambers of the Indian Legislature in exactly the same words and form and has so been assented to by the Governor-General, it is impossible and improper for the.

Court further to investigate whether each, Chamber and the Governor-General gave the same meaning {{FOOTNOTE}}

(1) 239 U S 325 (2) 251 U S 146

(3) AIR 1945 FC 25 ' and connotation to the common terms used. In this case the Court is asked to act on presumptions. But if the Court can consider presumptions it seems to me impossible to exclude cases when positive evidence might be offered. In some other case the Court might be asked to act upon allegations of fact that so many individuals voted upon some misapprehension as to the meaning of some word or words used so that no real majority was obtained in favour of a Bill in one Chamber or the other. How could such an investigation be conducted. What steps could a Court properly take to obtain evidence on the matter. I can see no end to the difficulties which might arise or the conflicts which Legislatures in which Courts might become involved if the Courts ever assumed the right to investigate what meaning in fact this or that Chamber or individual members attributed to the words or phrases in a Bill at the time they voted in favour of the passing of it. A similar investigation into the mind of the Governor-General at the time of declaring assent would be not less improper.

' In my judgment it is not therefore permissible for a Court to investigate the actual meaning or connotation alleged to have been given to or held regarding words and phrases in Bills by individual legislators at the time a Bill is passed by. The Chamber of which they are members. Nor do I think that a Court can be asked to make presumptions from the powers of the Legislature at the material dates or from any other circumstances as to the meaning or connotation given to or held regarding words or phrases in Bills by the members of Legislative Chambers who pass the Bills. The powers of the Legislature cannot, I think, be used to found any such presumptions."

74. From the above it is clear that the Federal Court denied the right to the Court to investigate into the affairs ' of the Legislattire either for reaching a conclusion of fact or drawing a presumption of fact in a case where the validity of an act was challenged through an administrative suit on the clear principle of conflict with the Legislature which was one of the three functional organs under the Government of India Act, 1935. The principle in this decision also rests on the mutual respect of one department for another, which guarantees it from interfering with the functions of the other. It is, accordingly, in accord with the ratio of the decisions cited above. Therefore, on the factual plane there is no room left for drawing, an adverse inference, such. As the High Court did, on a matter which exclusively pertained to the legislative field for the determination of which the judicial power could not be exerted.

75. Enough has been said on the legal plane against the drawal of such inference nevertheless the next limb of the argument may also be attended to on the supposition, although not conceded, that the High Court had the power to enquire into the legislative mala fides and had, in fact, drawn an adverse inference. Pursuant to the application made for summoning the entire file of Martial Law Regulations issued from time to time, a statement. Was made by the counsel for the second appellant that the one relating to the imptigned legislative instrument was not traceable, although some other files were produced. The judgment does not take note of this fact and ought it be said that this could be a justifiable reason for the relevant file to have been misplaced and for that reason not traceable after a number of years when its custody was with the then Martial Law authorities. The conclusion that it was wilfully withheld did not automatically flow from its non- production. The High Court instead of evaluatin . The reasons straightaway drew an adverse inference of fact that the impugned legislative instrument was not promulgated in the usual manner. Its reasoning for this conclusion was that had the file been produced the notings therein would have shown the reasons and its denial was referable to its being intentionally withheld. Now, before the drawal of such presumption, the law required some prima facie express proof and it was then that the onus could shift on to the second appellant to establish the bona fides of the legislation. Except for pleadings and assertions, which are not proof, there was nothing else to shift the onus on to the appellants. A cursory reference to the two incriminatory actions alleged against Inamur Rahman and the facts apparently taken by the High Court to be admitted, which reflected in a small measure to the inception of the Mill and the loan advanced to the sponsoring Directors; could not furnish any 'express proof', and the 'mere taking of judicial notice of incriminatory actions could not unequivocally pass off as proof of mala fides as the veracity of the facts on which these actions were founded was under dispute. Here I may add that the High Court also could not place reliance on the facts pleaded! As to the bona fides of the loan of Rs. 90 lacs taken by the sponsoring Directors and so also efforts made by them to secure loans from other K sources. As these matters were hotly disputed, they required appraisal and a finding thereon as essentially they were matters of proof. Accordingly, they could not be regarded as proof which the High Court erroneously did, so as to place the onus on the appellants to show the bona fides o legislation. The whole exercise was founded upon the acceptance of the assertions and pleadings of the respondent as reflecting factual truth when it, in reality, presented a controversy requiring adjudication on merits.

76. Again what needs further consideration is that the High Court has relied on the pleadings and assertions yet it has not applied its mind to the conduct of the respondent in shifting his stand on mala fides in three different was and its possible effect on the merits of such pleadings qua personal malice of the law-giver. In the original petition malice in law was pleaded against the second appellant, but in the respondent's "affidavit in opposition" there was shift in the stand and it was asserted that it was the first appellant who had fed wrong and malicious information to the then President and the Chief Martial Law Administrator, which resulted in the promulgation of the impugned legislative instrument. The case did not rest here and in the amended petition instances were given to show that the President and the Chief Martial Law Administrator was maliciously disposed towards Inamur Rehman who did not file any counter-affidavit nor was he a party to the proceedings. Realising this flaw and to make amends, an affidavit was filed by him in this Court on 13th of June, 1981, which again is a belated attempt to support the factual allegations. Even in this affidavit a further ground was given out that in the month of October, 1972 late Zulfikar Ali Bhutto expressed his mind at the Boat Club, Karachi that he was coming in the way of his taking power from General Agha Muhammad Yahya Kban. Of what value can it be is not far to seek without a counter-version. Co-related with these omissions and of singular significance was the fact that late Zulfikar Ali Bhutto was not impleaded as a party in the proceedings although the allegations were made against him at a time when he did not hold the office of the President and the Chief Martial Law Administrator. His non joinder was a serious question and its effect would be considered later on when attending to this aspect of the case.

77. There is also the violation of mode of proof. Elliot in his treatise on Evidence, Volume I, at page 125, has expressed that proof of 'express malice' is a rule of substantial law, which cannot ordinarily be conclusively presumed as a substitute for proof. This rule also goes to support that strict compliance as to proof is an imperative requirement.

78. In the result, from the above discussion, in my opinion, it is clear that the High Court did not strictly adhere to the mode of proof nor did it weigh the material considerations as pointed out above, which conclusively went against the exercise of discretion as such..., in this view of the matter, it is not possible to uphold the conclusion of the High Court even on merits.

79. Now as alluded earlier, the respondent in his "affidavit in opposition" alleged that the first appellant fed wrong and malicious information to the law-giver which culminated in the passing of the impugned legislative instrument. This assertion in the form of an allegation came on record after the disclosure of the documents containing the minutes. It was not pleaded in the original petition, and the stand, taken therein was one of mala fides in law, nor was it adumbrated as a ground in the amended petition. It Was an open question whether if not pleaded specifically could the High Court treat it as a ground of mala fides qua the first appellant. The High Court did not attend to the matter from this angle although it gave a concrete finding against the first appellant as being interested in procuring the promulgation of the impugned legislatiiie instrument. The law in regard to non-pleading of a specific matter is very clear and if that rule had been taken into consideration then such an assertion could not be given any legal consideration. Be that as it may, in view of the finding, the question which still requires consideration is whether the High Court was correct to construe the minutes of the meetings dated 21st December, 1971 and 24th of December, 1971, as it did. As for the actual influence exercised in procuring the impugned legislative instrument, the respondent had led no direct evidence. It was only from the minutes and the production of those documents containing them that the High Court drew an inference of bad faith keeping also in view the "assertions" and the "pleadings" of the respondent.

80. I would first advert to the opinion of the High Court that the minutes were not comprehensive in two essential details and also for highlighting the family of Inamur Rahman :

(a) Absence of any reference to the huge advances made to the Mill by several other financial institutions such. As P. I. C. I. C., N. I. T., I. C. P. And National & Grindlays Bank Ltd., London Branch ;

(b) The name of lnamur Rahman and his family alone was given undue prominence ; and

(c) There was no hurry for taking action as was initiated for issuing the impugned legislative instrument just three days after his assumption of office as the President and the C. M. L. A.

' How these factors could have affected the mi9d of the law-giver is not apparent, but for what they are worth I will now bring them out : In regard to (a) : ' Suffice it to say that as averred by the respondent it was only the influence of his father which was the main factor for enabling the securing of funds and credits amounting to Rs. 4'4 crores from the institutions and so also the suppliers' credit of 2,075,738. Contrary to it, the first appellant has explicitly averred that it was the G.H.Q. Which was persuaded to undertake the financial commitments for the overall credits and funds keeping in mind that the inception of the Mill was at the behest of the G. H. Q. And for the welfare of the ex-army personnel, and that it had discharged the liabilities of the Mill to the tune of Rs. 1,98,64,327. As contended by the first appellant there is no evidence on record to sustain that the respondent or his family or group invested or contributed a single pie in establishing the Mill at Khoski, but traded on the loans of the D. W. R. In this behalf two instances are notable. The first is that in reply to the plea of the respondent, based on the opinion of Mr. Naimuddin dated the 25th of December, 1973, that he and his group had invested about Rs.

30 lacs in the Mill, the first appellant relied on the same opinion to contend that this amount was loaned to the Mill by the Standard Bank Limited from the account of the Army Group Savings Funds and that immediately after the promulgation of the impugned legislative instrument the respondent as the Managing Director manoeuvred the transfer of the liability to A. R. K. Industrial Managements Limited; nevertheless the demand notice was sent by the Standard Bank Limited to the first appellant on 19th of April, 1973 for the payment of Rs. 30 lacs. The second is that Rs. 20 lacs appears to have been advanced to the Mill by the Standard Bank Limited as a temporary loan which is not disputed by the respondent but its investment in the Mill is controverted by the first appellant. The averment, therefore, does not advance the case of the respondent to the extent of tagging the huge advances to the pecuniary commitments of the father of the respondent qua the financial institution such as the P. I. C. I. C., I. C. P., N. I. T. And the National & Grindlays Bank Limited, London Branch or for that matter these loans. I regret to say that the High Court did not probe as to whose liability those advances were, but under a misconception took them to be the financial commitments of the respondent or his father which was not the case. As regards the influence exerted by Inamur Rahman this factor is disputed by the first appellant and is even belied by the affidavit of Saeed Ahamad who while admitting that Inamur Rahman had negotiated the arrangements, for the Mill has stated 'that the arrangements were sanctioned by the P. I. C. I. C. In the ordinary course purely on the merits of the case without being influenced by the participation of the D. W. R'. There is, however, no denial in this affidavit of the commitments and undertakings given by the D. W. R. And the G. H. Q. Therefore such an averment had no legal worth, and it was wholly unnecessary to emphasize its omission from the minutes.

' In regard to (b) : ' Dealing now with this clause, the reason for it is sumptuous and valid. It has been tacitly shown by the first appellant that the loan taken by the sponsoring Directors was not only spent in their shareholding but also of their family members, some outsiders and their family enterprise, namely, "the A. R. K. Industrial Managements Ltd". In this manner, it were the sponsoring Directors who had themselves introduced the family members ;n the arena when it came to inflating the status of the family members in the Mill. What possible stigma could the High Court infer from this fact, I am unable to comprehend. It could not certainly be because of any bad faith against Inamur Rahman but to show how much the family members were involved qua the utilization of the loan which was advanced for being invested in the Mill. This factor also 'could not provide any basis for any bad faith against the sponsor of the minutes. In regard to (c) : And lastly as to this clause, the hasty issuance of the impugned legislative instrument, as noticed by the High Court, was for the impelling necessity of protecting the Welfare funds amounting to Rs.

1.55 crores and also for the reason that because of the loans and the non-payment of interest on the loans coupled with the fact that on its own loans, Standard Bank Limited was charging interest, the Welfare funds had deleted to an extent that it was difficult to defray individual as well as collective grants which required immediate corrective measures for enabling the beneficial activities of the Welfare Directorate to be carried out. In keeping with the above rationale, the extrinsic factors, such as haste and other political matters awaiting earlier attention cannot, in any way, affect the validity of the impugned legislatively instrument as it is the law-giver who is the sole judge of the necessity of such legislation and on no principle of interpretation can the vires of the legislation be attacked by reference to such extrinsic factors.

81. Having individually considered each factor on its merits, I am of the opinion, that these could not be taken into consideration for holding against the bona fides of the minutes.

82. Two other contemporaneous factors of which judicial notice was taken by the High Court require consideration. The first relates to the action taken against Inamur Rahman in freezing the repatriated asset declared under Martial Law Regulation 104. The funds were frozen under the provisions of the Foreign Exchange (Prevention of Payments) Act, 1972 as amended by the Foreign Exchange (Prevention of Payments) (Amendment) Act, 1974. By this action it was stated that the first appellant stood to gain because of the enabling provisions in the said Act which entitled the firs appellant to claim it. The background which did not surface in the judge meat of the High Court was that Inamur Rahman negotiated for the purchase of machinery from M/s A. W. Smith & Co.

Limited and obtained a secret commission equivalent to 10% of the F.

0. B. Price i. e. 19,95,902. This amount was deposited on commercial basis in the name of the Mill with the Pakistan Overseas Standard Bank Limited, a branch of the Standard N Bank Limited, on 30th of December, 1969 and finally adjusted against the payment of 10% commission demanded by Inamur Rahman as a representative of the Mill. In this connection before its adjustment Inamur Rahman had filed an action in the Queen's Bench Division (Commercial Court) on the basis of an oral commitment for the recovery of the commission but it was subsequently withdrawn as the commitment stood fulfilled. However, Inamur Rahman did not disclose the receipt of the commission to the Board of Directors nor to the shareholders nor even to the G. H. Q. This amount, in fact, belonged to the Mill for which he had acted as an agent and the purpose of taking action against him under the Foreign Exchange (Prevention of Payments) Act, 1972 and the Foreign Exchange (Prevention of Payments) (Amendment) Act, 1974 was to enable the repatriated foreign exchange to be paid to the persons to whom it really belonged. It Covered the cases of all those persons who came within its purview. This Ordinanc was even challenged by Inamur Rahman when he was removed from the office of the Managing Director of the Bank through Constitutional Petition No. 627 of 1973 in the former High Court of Sind & Baluchistan which was dismissed. In this petition he had alleged mala fides against Muhammad Yousaf. Against the order of dismissal he filed a petition for leave to appear in this Court which was disposed of as infructuous after the banks were nationalized. Inamur Rahman did not repatriate the entire amount of the commission but only a part of it i. e. 1,70,000. He imputed mala fide to the then President and the Chief Martial Law Administrator for singlin him out for action. Can it be said by any stretch of imagination that he was the victim of any mala fides when he himself usurped the commission and under the law action was taken against him to retrieve it. Besides these legal legislative instruments were passed by the National Assembly and can one legally impute motives to the Members of the National Assembly against Inamur Rahman. Inamur Rahman himself produced no evidence to substantiate his allegation that the so-called action taken against him was not for this purpose, but to deprive him of his lawful gain. His own pie is that he received the commission in the normal course and that he had the authority though oral from the Board of Directors to charge such commission and to pocket it, which on the face of it appears to be absurd. Accordingly, he had no legal right to appropriate it as his own gain if h had acted for and on behalf of the Mill as its agent or in some other fiduciary capacity. In these circumstances, one wonders how the High Court could take judicial notice of this action and draw an inferential; conclusion of mala fides.

82-A. The second being that Inamur Rahman was placed under house arrest alongwith the other senior army officers at about the time when the impugned legislative instrument was promulgated. The real reason for this action has not come on the surface and rightly so in the public interest but what is apparent from the assertion of the first appellant is that his house arrest was due to his intimate connections with the persons who were at the helm of the affairs at the time of dismemberment of the. Country in consequence of the 1971 War which must have raised a.

Suspicion of some complicity on his part. Be that as it may, Inamur Rahman himself stated, in his affidavit that he was arrested and his house was searched for taking' into "possession recorded tapes of certain conversations that had taken place between General Agha Muhammad Yahya Khan and late Zulfikar All Bhutto", and this purpose was disclosed to him by the police officers.

There is, however, no such evidence as to the correctness `of his assertion and all that can be said is that the reason was hidden. The High Court could not, therefore, draw any inference of malice qua late Zulfikar Ali Bhutto.

83. For a better understanding of the minutes it would be relevant here to give some inkling of the background in which loans amounting to Rs.

1.55 crores were taken by the sponsoring Directors in their personal names. This is also materially linked up with the public nature of the funds. This project was admittedly conceived, advanced and aided as an enterprise primarily directed at economic amelioration of settlers of that area who were mostly ex-army personnel. The first appellant which is a charitable trust, caters for the welfare of ex-army personnel under its charter. As was the case that it was asked' to undertake the project, but it declined. This denial, as alleged, was never expressed by the first appellant. Be that as it may, the respondent took upon himself the responsibility of establishing the Mill for the benefit of ex- army personnel settlers in that area, and permission was granted to him to do so. How he was chosen to undertake this project was, undeniably, because of his father's intimate terms with the late General Agha Muhammad Yahya Khan. And the then Adjutant-General. In spite of it if the things had proceeded as promised, undertaken or planned no future corrective measure would have at all been necessary. However, he had no financial standing and was not, therefore, in a position to invest his own personal funds to raise the Mill, though it has now been given out as an averment that Inamur Rahman as being the Managing Director of a first class scheduled bank could have raised large funds on easy terms or else he could have managed with the then Commander-in-Chief to exert his influence for obtaining the loans, but such a course was not adopted as the D. W. R. Itself had advanced the loan to promote its own interest on such terms as were less favourable to the sponsoring Directors as compared to those of other financial institutions. Another reason assigned by the respondent was that because of the increase in the capacity of the Mill the petitioner and his associates were persuaded to agree to the increased capacity on an assurance by the G. H. Q. To arrange additional finances consequent to the increase in capacity which was more than twice the original estimate. If at all this assurance was given then its terms are not apparent from the record. Why then such a loan was taken if the terms were less favourable and why was the loan appropriated to promote the personal interest of the sponsoring Directors and their family members are serious questions which are not answered by the averments. The fact remains that the then Adjutant-General came to his rescue and managed to secure for him the following loans in his personal name and that of his mother :

(i) A loan of Rs. 90 lacs with interest at the rate of 10% per annum from the D. W. R.

(ii) A loan of Rs. 40 lacs in exchange for debentures which were to be issued to the D. W. R. By the Mill with interest at the rate of 9i % per annum during the interregnum.

(iii) A sum of Rs. 25 lacs as an investment by the D. W. R. In shares of the Mill with interest at the rate of 6% per annum till the shares were issued.

84. The correspondence which preceded these loans between the Adjutant-General and the Chairman of the Mill sufficiently brings out the deviations and it would suffice here to enumerate some of them :

(a) Instead of the loan being advanced to the Mill for investing in it, it was transferred to the personal account of the sponsoring Directors, namely, Shamimur Rahman and his mother, in the Standard Bank Limited even before the furnishing of the sure guarantee as visualized in the agreement dated 21st of January, 1970.

(b) The surreptitious substitution of the bank guarantee by the unsigned and undated guarantee of the Standard Insurance Company Limited, which also expired on 15th of August, 1971, and the improper inclusion of a stipulation of pledging the shares with the Standard Bank Limited in terms of the interim guarantee given by the bank, an institution fully and completely under the control of Inamur Rahman.

(c) Till the Mill went into production, the rate of interest was reduced from 10% to 6% per annum.

(d) Instead of the agreement dated 21st of January, 1970, being executed between the Mill as agreed upon and the Adjutant-General as representing the D. W. R., it was executed between the sponsoring Directors and the latter.

(e) No provision was made in the agreement for the contribution of 5% of the net profits to the G. H.

Q. Welfare Funds.

( f) The loan thus taken was invested by the sponsoring Directors in the shareholding of themselves and their family members and also the A. R. K. Industrial Mangements Limited, a family concern of the respondent, which was subsequently appointed as Managing Agents of the Mill.

(g) A. R. K. Industrial Managements Limited, a family concern of the sponsoring Directors, was appointed as the Managing Agents of the Mill, but despite the earlier assurance to appoint a representative of the D. W. R. As one of the Directors was shelled and none was appointed.

Nonetheless, a further loan amounting to Rs. 58,11,446 was also drawn by A. R. K. Industrial Managements Limited from the Army Group Savings Funds lying with the Standard Bank Limited on the verbal instructions of the Managing Director of the Standard Bank Limited, namely, Inamur Rahman, in violation of credit restrictions. Thus a total shareholding of these persons came to Rs. 1 crore whereas that of the D. W. R., Rs. 25 lacs and the .Entire paid-up capital of Rs. 1'25 crores was drawn from the G.H.Q. Welfare Funds. Besides, the G. H. Q. Was also persuaded to undertake the other financial commitments on behalf of the Mill which are sufficiently stated in paragraph 16 of the judgment.

(h) As per the agreement, it were the parties who were bound under the agreement for pledging the shares but the other family members, some outsiders and the A. R. K. Industrial Managements Limited, who also be benefitted from the loan as shareholders were under no compulsion to pledge their shares as they were not bound by the agreement which again was highly objectionable as the amount of loan taken by them was unprotected.

(i) Inamur Rahman further received a commission equivalent to 10% of the F. O. B. Price of the machinery of the Mill amounting,to 199,590'40 which was not accounted for and treated as his personal acquisition out of which repatriated amount equivalent to 170,000 was frozen. This is the amount to which a reference was made in the judgment as an instance of mala fides.

( j) In the matter of the issuance of debentures, the D. W. R. Was to be allotted non-convertible 'A' series debentures while the other lenders were allotted convertible 'B' series debentures which too were not delivered to the D. W. R. As for the interest which manifestly represented the profits intended for the welfare activities was not paid as undertaken with the result that on the date of the promulgation of the impugned legislative instrument, the G. H. Q. Only received a sum of Rs.

5,40,000 leaving a balance of Rs. 15,19,959.

84-A. In the milieu of the deviations, it falls for consideration as to whether the High Court was correct to infer the bona fides of loan of Rs. 90 lacs, the failure on the part of the D. W. R. To complain in regard to the loan being insecure, the beneficial utilization of the loan, towards the setting up of the Mill and the payment of interest amounting to Rs. 5,40,000 as a due discharge of the obligation qua the first appellant.

85. The deviations pointed out above in the over-all background of the earlier terms offered sufficiently go to establish that the amount Rs. 90 lacs loaned to the sponsoring Directors was not an independen and a voluntary transaction, but surreptitiously manoeuvred to extend maximum benefit to them. The reason is not far to seek as the intimat relationship between Inamur Rahman and late General Agha Muhammad Yahya Khan was notoriously known who exploited his relations to gain this benefit with the active help and support of the then. Adjutant-General. The correspondence on record speaks volumes about the involvement of the then Adjutant-General.

How could then the High Court regard it as bona fide, I am unable to see. In this situation of collusion one can imagine why the D. W. R. Did not object to the loan being insecure. As tacitly shown, the loan was advanced even before the stipulation for the furnishing of the bank guarantee was complied with. The interim bank guarantee as agreed upon was furnished and acknowledged.

This had to be kept intact till the share certificates of the required value of Rs. 1 crore were deposited with the Standard Bank. On the transfer of the loan amount to the fixed deposit account of the sponsoring Directors, the bank guarantee was released and the bank asked the return of the bank guarantee, which was refused by the D. W. R. The guaranteeing bank wanted to re-exercise its lien on the account but instead of that happening, the bank guarantee with D. W. R. Was substituted by another guarantee issued by the Standard Insurance Company. There is no record as to how this came to be done. The explanation of the respondent is that according to the first appellant the Standard Insurance Company appeared to be solvent, reputed and creditworthy a guarantor, and, in any case, shares of the required value were pledged with the bank on 22nd of March, 1971. At no time was the D. W. R. Informed of the pledge of these shares. The substitution of the prescribed guarantee by another without express understanding between the contracting parties could justifiably give rise to feeling of suspicion that the funds advanced were not so secure as they were sup- posed to be. The High Court, it seems, did not take into consideration the version of the first appellant grounded in the affidavit of Maj.-Gen. (Retd.) Muhammad Nawaz Malik, who inter alia, stated that the shares remained in the custody of the Standard Insurance Company Limited. Obviously, the High Court was misled to hold that the D. W. R. Was not aggrieved qua the insecurity of the loans. As for the utilization of the loan advanced to the sponsoring Directors for being invested in the Mill, the sponsoring Directors invested in their shareholding only Rs. 46 lacs out of a sum of Rs. 90 lacs. As regards the remainder, the explanation was that they invested it in the Mill alright but did so in the name of their other relations. At no stage and in no document any such relative owned this explanation. On the other hand, when it came to showing the extent of their vested rights in terms of the massive value of their property injuriously affected by the action taken, they talked of Rehmania group of investors and did not either set off or account for those ninety lacs. The High Court did not apply its mind in depth to this matter, but on the assumption that the loan amount was invested in the Mill, the High Court R further held that the sponsoring Directors had successfully established the Mill which had gone into production. How successful was the trading business is again highlighted by the Auditors' report according to which there was a loss of Rs. 13,18,888 for the period from 24th of November, 1971 to 30th of December, 1971. To give thus the full credit to the sponsoring Directors for establishing the Mill was erroneous as it was principally the G. H. Q. Which was responsible for the setting up of the Mill. Lastly. The payment of a sum of Rs. 5,40,000 was taken by the High Court as sufficient compliance of the undertaking to pay the required interest on the loans taken which again was a part of the amount due for it left a balance of Rs. 15,90,951 payable to the D. W. R., which has now been paid by the first appellant. One wonders as to what bona fides were on the side of the respondent as the High Court apparently seems to have contented itself by the pleadings and the assertions of the respondent, disputed as they were, as to veracity and fuller contents. None of these considerations could influence the formation of the opinion as to bad faith.

86. Earlier to the minutes dated 21st of December, 1971, Colonel Sher Khan of the D. W. R. Expressed his misgivings about the agreement itself in his note dated 6th of March, 1971. This note was given on the representation of the sponsoring Directors dated 25th of January, 1971 whereby they sought the transfer of loan of Rs. 90 lacs in favour of A. R. K. Industrial Managements Limited on the same terms and conditions as stipulated in the earlier agreement. By a subsequent note dated 3rd of April, 1971 it was pointed out that by the rate of interest agreed to in the original agreement the D.

W. R. Was losing Rs. 2,38.709 per annum and a corrective measure was suggested. Again in the third note dated 6th of June, 1971 alternatives were suggested : "(a) Rehmania Sugar Mill be asked to pay the outstanding accrued amount of interest details of which are given below :

(i) Rs. 5,40,000 as interest on Rs. 90 lacs up to 8th September, 1970.

(ii) Rs. 24,300 as interest on Rs. 5,40,000 mentioned in (i) above from 8th September, 1970 to 8th June, 1971.

(iii) Rs. 1,27,820 as interest on amount earmarked for investment in shares worth Rs. 25 lacs from 25th May 1970 to 31st March, 1971.

(iv) Rs. 3,830 as interest on (iii) above as the interest was not paid on due date.

(v) Rs. 3,80,000 as interest on debentures worth Rs. 40 lacs. Total Rs. 10,75,950. or

(b) In case we accept their plea that amount will be paid when the Mill goes into commercial production, Rahmania Sugar Mill be asked to commit in writing that they will pay compound interest to save or funds from the loss of about Rs. 73,000 (for 2 years and 3 months).

(c) Till the Fund position improves we may suspend all individual as well as collective grants. Or

(b) Standard Bank Ltd. Be asked to increase the limit of overdraft from Rs. 10 laes to Rs. 20 lacs on 6% interest. Submitted for orders."

' But the Adjutant-General, as would appear from the footnote, directed that the matter be pursued by issuing reminders. The record shows that several reminders were sent but to no avail,

87. As interest remained unpaid despite the reminders, the Managing Director, Fauji Foundation submitted a note to the then Commander-in-Chief on 21st of December, 1971, disclosing, a serious apprehension as to the recovery of the insecure loan of Rs.

1.55 crores on account of the flaws in the agreement unless suitable steps were taken. The note dated 21st of December, 1971 was submitted to the then Commander-in-Chief, General Agha Muhammad Yahya Khan, who directed the Adjutant-General's branch to submit its comments.

Before the comments were submitted, General Agha Muhammad Yahya Khan was replaced by late Zulfikar Ali Bhutto as the President and the C. M. L. A. A further note was recorded on 24th of December, 1971, in which alternatives were recorded for retrieving the public funds and one of it was that the first appellant should take over the assets and liabilities of the Mill for discharging the obligations. This was after the meeting held on 23rd of December, 1971 which was attended to by the Minister of Presidential Affairs, the Defence Advisor, the Defence Secretary, the Managing Director of the Fauji Foundation and the Director, Welfare and Rehabilitation, G. H. Q., and it was in that meeting that the then President and the Chief Martial Law Administrator decided after due deliberations with those present that the Mill should be taken over by the first appellant. A request was also made for the issuance of the Martial Law Regulation for giving effect to this decision.

87. There is also a controversy as to how the minutes originated. According to the first appellant they originated at the behest of Lt.- General (Retd.) Gul Hassan which is controverted by the respondent whose assertion is based on the comments dated 18th August, 1972, of the Managing Director, Fauji Foundation and the affidavit of Brig. .Mahmud, in which it was disclosed that the D. W.

R. Had no reason to feel apprehensive of its investment in the project and that it was late Zulfikar Ali Bhutto who initiated the, impugned action. As for the assertion of Lt. General (Retd.) Gul Hassan, it was given out that he had given a tailored statement which on the face of it was false. Further the contents of the affidavit of Brig. Mahmud were again denied by Maj.-General (Retd.) - Muhammad Nawaz Malik in his affidavit dated 24th of August, 1981. Para. 15 of the comments dated 18th of August, 1972, incorporates the incorporates the opinion of the author in regard to the conduct of Inamur Rahman which apparently is well-projected in the earlier paragraph. Para. 16 on which great reliance is placed is also referable to the opinion of the author in the context of his solicitation that he was "innocent" and a "grieved martyr". Such opinion even if it be taken on its face N alue is not proof and does not establish that late Zulfikar Ali Bhutto had any ill-will or malice against him for the reason that he opposed his election from that constituency. Here it would be of interest to refer to the order of late Zulfikar Ali Bhutto on his representation dated 8th of May, 1974, which is self-explanatory : "Please have everything decided on MERIT. There is to be no injustice but no favour either". At least this much can be said that despite the imputation against him he wanted the case of Inamur Rahman to be dealt with fairly.

88. The legal justification for issuing a legislative instrument is a matter solely within the competence of Legislature or the law-giver. It is not one which can be judicially reviewed as will appear from the discussion which follows elsewhere in the judgment. Accordingly, it will not be proper to enter into any inquiry as to who is wrong and who is right in the in lieu of disputed facts, As such it will not be worthwhile to assess the value of the claims in the affidavits of Lt. Gen. (Retd.)- Gul Hassan and Brig. Mahmud. However, as the High Court has adverted to the minutes and drawn adverse inferences, I would, accordingly, venture to assess it objectively as I consider this the only proper course without prejudice to the legal limitations.

90. The issue raised in the minutes was as to the loan being insecure and as to the grave danger in losing the funds when the army had no say in the management of the project as it did not hold the controlling shares. The question as to the loan of Rs. 90 lacs being secured or not was seriously debated before us. The case of the first appellant was that the bank guarantee of the Standard Bank Limited was not available on the record and the only guarantee produced was an unsigned guarantee of the Standard Insurance Company Limited which too had expired. How this came to be substituted without the express permission of the D. W. R. Was again not clear. This guarantee was neither visualized nor could it be regarded as "sure guarantee" in favour of the D. W. R. As for the pledge of the shares stipulated in the bank guarantee executed by the Standard Bank Limited, it is also illusory as the law prescribes the pledge of security with the creditors and not with the nominee of the debtor such as the Standard Bank Limited. And even if it be assumed as contended by the respondent that the deposit was in the nature of an "escrow" then such a deposit should have been with an independent third party. Neither there was any consideration between the D. W.

R. And the bank nor was the D. W. R. Informed about the deposit of the shares with the Standard Bank Limited though a letter dated 22nd March, 1971 has been produced to show that the A. R. K.

Industrial Managements Limited had delivered the share certificates of the face value of Rs. 1 crore alongwith transfer deeds. Why a copy of this letter was not sent to D. W. R. Which was directly concerned with the security of the loan was not explained. Further as the controlling-shares were held by the respondent and his family members and the family concern they could make ineffective the transfer deeds if they so choose to do. It was next pointed out that so far as the other family members were concerned, who had invested the balance of the loan in their shareholding, there was n agreement by them to pledge the shares or to deposit the same with the bank, and that they had the option to withdraw them at any time from the custody of the bank. In this manner the remainder of the loan o Rs. 90 lacs was not secured. Again the shares were not marketable a they were not quoted at the stock exchange.

91. In a nutshell what emerges from this discourse is that the D.W. R. Had neither the security of any guarantee nor the custody of the shares. The sum of Rs. 90 lacs before being advanced as loan to the sponsoring Directors was invested with the Standard Bank Limited in fixed deposits earning 6i % to 7i% interest per annum. It was withdraw from there and given to the sponsoring Directors, inter alia, on the condition that the interest would be paid at the rate of 6% per annum from the date of advance till the Mill went into commercial production and thereafter the rate of interest was to be 10% till full repayment thereof. The loan was actually advanced on 8th of September, 1969. The breach in the undertaking to pay interest showed that instead of earning profits on this loan the D.

W. R. Suffered losses due to the non-payment of interest so much so that its funds got depleted which obstructed its welfare activities. The respondent in regard to investment took up a purely legal plea an contended that the loan of Rs. 90 lacs related to the personal , conduct of the sponsoring Directors and the Mill, which was a legal entity was not concerned with that matter. This was a novel plea in the ambit of the whole controversy and ought it be said that it did not lie in th mouth of the respondent to say so as this loan was advanced for the prim object of being invested in the. Mill.

92. In regard to the Debenture Trust Deed the case of the first appellant is that it was executed as late as 2nd of November,. 1971, but no debentures were issued to D. W. R. In the Debenture Trust Deed itself, debentures of D. W. R. Were made non-convertible but the debentures of the other parties were made convertible into shares, the intention behind this arrangement was to avoid altogether any eventuality under which the D. W. R. May acquire controlling interest in the share capital of the Mill. Why this rider was introduced qua the debentures of the D. W. R., which had provided a loan of Rs.

1.55 crores, I am not able to discern, but apparently there was some motive- behind it. As to the non-issue of the debentures the explanation is that the consent of the Controller of Capital Issues was not obtained and in the-meantime the Mill was taken over by the first appellant. The loan of Rs.

40 lacs advanced by the D. W. R. For the debentures was also without any security until the 2nd of November, 1971, and as would appear from the letter of 16th June, 1970 (Vol. VI, p. 44) the explanation of the respondent was that the permission of the Controller of the Capital Issues' was awaited and for this short period it would be rather expensive to furnish a bank guarantee. Interest on this loan was also not paid as undertaken. There is no dispute as, to the delivery of the shares of the face value of Rs. 25 lacs to the D. W. R. As representing its participation in equity share capital, but on this amount too there was a breach in the payment of interest.

93. It would be necessary here to project the official financial position of the Mill as existing on the date impugned legislative instrument was made and as reflected in the judgment of the High Court : {{TALBE}} Authorized capitalRs. 5 crores Paid-up capitalRs. 2.50 crores Subscribed capitalRs. 1.25 crores n.~ . .1~, t; .^,loans raised inRs. 1.80 crores Local currency Local short terms loansRs. 89, 14,739 Foreign Exchange Loan, -- 22,60,000 Details Subscribed capital of Rs. 1.25 crores.

A-Rehmania group of associates and relatives of respondent.

Mr. Shamimur RehmanRs. 26,00,000 BeguM Shamimur RahmanRs. 20,00,000 '

Miss Rukhsana RahmariRs. 26,00,000 Mr. Inamur RahmanRs. 10,00,000 --WMr. Ataur RahmanRs25,000 A. R. K. Industrial Manage-Rs. 16,75,000 ipent Limited. ~-. FitMr. M. Aslam, _Rs.25,000 - .

Mr. A. D. AhmedRs. 25,000 Mr. Mian MuhammadRs. 25,000 Rafi Mr. Riaz ShafiRs. 25,000 Rs. 1,00,00,000 B-DWR Shares Rs. 25,00,000 Loans in Local currency PICICRs.50,00,000 IDP .Rs.75,00,000 NITRs.10,00,000 ICPRs.25,00,000 DWRRs.40,00,000 RespondentRs.25,00,000 and his associates.

Loans in foreign currencies Suppliers credit by Messrs AW Smith-- 20,50,000 National & Grindlays Bank-- 2,00,000 PICIC-- 60,000 Short-term Loans Details not specifiedRs. 89,14,739 Actual Financial Involvement Invest- ment of DWR in the Mill: Loan to respondent and his mother, promoters of the Mill for investment in the Mill.Rs. 90,00,000 SharesRs. 25,00,900 DebenturesRs. 40,00,000 Rs. 1,55,00,000

94. The respondent has contended that it had invested Rs.

1.17 crores which was apparent from the balance-sheet relied on by the first appellant and that its correctness could be demonstrated from the balance-sheet itself. This amount was also shown in para. 31 (q) of the judgment along-with other amounts totalling Rs.

384.5 lacs. All this does not appear from the financial position of the Mill apart from the shareholding of the Rehmania group of investors which as explained earlier was invested from the loan of Rs. 90 lacs taken from the D. W. R. The break-up of some of the items has not been given to illustrate the manner of investment in the Mill and there is nothing to show that the respondent discharged any of the aforementioned loans of the Mill. It would also be fruitful here to recount that loans of different amounts were taken in the name of the Mill from the Standard Bank Limited. The family concern of the respondent, namely, A. R. K. Industrial Managements Limited also took a loan of a large sum of money from the Army Group Savings Funds. Instances are available that from the loans borrowed for the Mill sizable amounts were transferred to the family concern of the sponsoring Directors and retrieved later. It is true that the respondent has filed suits for the recovery of substantial amounts but those will be decided on their merits. But so far as the investment in the Mill is concerned, it was exclusively from the loans borrowed from the army welfare funds and by a device the respondent and his family got absolute control of a big industrial project without investing their personal funds. As would appear from the foregoing narration, the involvement of G. H. Q. Was not only to the extent of Rs.

1.55 crores but also of another sum of Rs. 110 lacs on account of its firm commitments to render further assistance. In all this amount totalled Rs.

2.65 crores. It was during the inquiry preceding the promulgation of the impugned legislative instrument that it appeared how precarious V the financial position of the G. H. Q. Loans was which required imperativ correction.

95. In this setting the question arises as to the public interest involve in the exertion of the power.

There is no gainsaying the fact that the project was taken in hand to ameliorate the economic conditions of the ex-army personnel settled in that region and the Mill was installed with the loans taken from the D. W. R. The funds of the a W. R. Were funds in truss to be spent for the welfare and rehabilitation of serving as well as ex-arm personnel and their families, that is, for a charitable purpose. Therefore, the welfare of the soldiers, their families and ex-army personnel was a matte of vital public concern and any dissipation of resources earmarked for their welfare and security had to be checked. What I find here is that the loan ken were used primarily by the sponsoring Directors to promote their own interest. All this obviously raised a suspicion, which cannot but be describe as genuine, the moreso when the sponsoring Directors took shelter behind the legal plea that the Mill was not concerned with the loan of Rs. 90 lac advanced to the sponsoring Directors. In this background of claim an counterclaim there was clear indication that the Company Law itself could not furnish a complete answer to it. As for the first appellant it serves the collective benefit of those who had served in the ranks, or as non combatants during World War II, their families and dependents. Since 1945 it was administered under Charitable Endowments Act, 1890. On th same reasoning and principle, the D. W. R., which looks after the welfare and rehabilitation of serving and ex-army personnel and their families, would qualify as a charitable institution. All authorities, including th Courts are, therefore, enjoined to look upon them with particular favou and to take somewhat unusual and stringent measures to enforce and protect them. Such being the nature of the funds and the duty of authorities dealing with them, the High Court was clearly in error in treating the loan of Rs 90 lacs as purely a private fund, a matter of no concern of Government or in observing that "the proclaimed object has no nexus with any public purpose" or that "it was not pleaded one behalf of the respondents that the' impugned Regulation was issued for any public purpose.'

95. The contention of the learned counsel for the respondent, by reference to financial affairs of other public companies limited by shares that such indebtedness, default and derelictions as were noticed ,in the case of respondent's affairs and of the Mill were a common feature in the country' not justifying singling out of the respondent, fails because in none else were' the concept of welfare, purposes of public charity, and charitable funds so extensively involved; with such a great risk as to stifle the welfare activity itself. This distinction existed at every stage of the enterprise, from its conception to its dissolution and even after dissolution. As the charitabi purpose was common, the first appellant was regarded as most suited a competent to take over and run this project as it had other projects in hand for the same purpose for the benefit of the ex-army personnel and serving personnel and their families. It was not a private organization so that I could acquire a financial gain of immense value and this seems to have been the consideration with the High Court while holding that it was interest to have it transferred to itself, which is erroneous on the face of it.

97. Objectively assessed, therefore, the 'conclusion cannot but be that in the decision taken to transfer. The Mill, "public interest" was vitally involved particularly when the existing law could not have adequately safeguarded that interest. Again in transferring the Mill to the first appellant on terms spelt out, the basic character of the project as a charitable, benevolent enterprise, notwithstanding its incorporation as a public limited company limited by shares was kept intact.

98. It is also abundantly clear that it was not the President and the Chief Martial Law Administrator who took the initiative on his own no was there anything to show that the Managing Director of the first appellant had prevailed over him during the deliberations which preceded the taking of such decision. He was influenced by the fact that the Mill was raised from the welfare funds of the G.H.Q.

In the personal hands of the sponsoring Directors ; and that it was the first appellant which being a charitable trust created entirely to serve servicemen and ex-servicemen was a proper body to, take charge of the project in their interest. Further no element of any personal malice appears from the noting which was even candidly conceded. So far as the mala fides of the then Managing Director of the first appellant is concerned there is also no evidence that he had any malice against the respondent or his father. He had also nothing personal to gain in the transfer of the Mill to the first appellant.

99. The High Court, accordingly, was not justified to hold as it did that the idea of promulgating the impugned legislative instrument was con ceiled in the course of private discourse. Based as it is on the facts and the attending circumstances taken together which do not either singly or cumulatively qualify as proof which is an imperative requirement of law. Asid from it no clear finding is given by the High Court in regard to the specific instances mentioned in the amended petition except for taking note of the two recriminatory actions taken against Inamur Rehman. The High Court had held that the second respondent was estopped from disputing the allegation of mala fides for the reason that punitive action was taken against certain persons including Inamur Rehman which stood so recorded in the White Paper. Technically speaking this rule is based on the equitable doctrine which regards as most inequitable and unjust if a person who by a representation made or by a conduct amounting to a representation, obliges another to act as he would not otherwise have done, should be allowed to deny or repudiate the effect of a former statement to the loss and injury of the person who acted on it. Such is not the case here for the application of this rule. Aside from it, by the non-observance of the rule of pleading, Inamur Rehma could also be shut from alleging mala fides as be failed to allege any imputation against the then President and the Chief Martial Law Administator in his representation dated the 8th of May, 1974 (p. 409, Vol. II of the Paper book). Equally this could not be a ground for allowing the respondent t add the ground of "malice in fact", which according to the High Court wa expressed in a subdued form in the original petition. If this was so then no notice could be taken unless it was pleaded expressly, The further reason given for not pleading it earlier is that both the respondent and Inamur Rehman were living in "terrorem" so long as late Zulfikar Ali Bhutto remained in power. This also could not be a reason for not pleading it until after he was out of power and if an instance is needed, it will be found in the case of Liaquat Ali v. Government of Sind (1).

100.It was also a misconception on the part of the High Court to treat D. W. R. As a distinct and independent body, and if the first appellant had pleaded that it was part and parcel of the G. H. Q., that is, an organization or a department under its control, it was not an error so as to weigh against the bona fides of the first appellant. There is unequivocal evidence to establish that the Adjutant- General on behalf of the D. W. R. Had executed the agreement as its Director, and the G. H. Q. Had an over-all control over its functioning as a charitable institution. It was, therefore, that the minutes dated 21st of December, 1971, were placed before the then Commander-in-Chief for his orders.

There is no proof that it was a separate entity as claimed by the respondent and accepted by the Court. The High Court again on the same parity of reasoning erroneously held without any basis that late Zulfikar Ali Bhutto, who had only assumed office three days earlier was successfully prevailed upon by the army authorities to accede to their self-motivated request, to kill the "Company" by issuing the impugned legislative instrument. How could such an assertion, even if made, take the place of proof so as to tilt the balance in favour of mala fides.

101.The High Court next took an exception to the production of the file by the first appellant containing the minutes, which was in its opinion an interested party. It is needless to emphasize again that the first appellant was not an interested party nor the custody of the file could be descry bed as private as there is nothing on record to show as to how the file came into its custody and ought it be said that being a party the first appellant may have procured the file from the proper custody for showing the bon fides of the decision taken by the law-giver. If at all the file had remained with the first appellant all along then how did the respondent manage to obtain a photostat copy of the minutes dated the 21st of December, 1972, (p. 21, Vol. VI). This strengthens the belief that the file was not with the first appellant all along, as seems to be the impression of the High Court when it used the word 'private'. Distinguishing it a little further, the firs appellant being a charitable trust and engaged in the welfare of the soldiers their families and ex-servicemen, it had in that capacity a direct liaison with the G. H. Q. Which is even now deeply interested in its charitable activities Mitch, so that it is manned by high-ranking retired Army Officers. Thus for its status as such the word 'private' was not appropriate particularly when I had to discharge its legal obligations under the impugned legislative instrument. Therefore, the High Court was in error to take such a factor into consideration for holding that it lent a support to the respondent's contention that the impugned legislative instrument was an executive fiat rather than legislative measure, the moreso when it had been amply demonstrated that the first appellant could have had no personal interest to exert on the law giver to issue such a legislative instrument.

100.The High Court has held that the substance of the case and the pleadings as a whole "are to be examined to meet the ends of justice".4 {{FOOTNOTE}}

(1) PLD 1973 Kar. 78 Substance of the case and the pleadings are not evidence but these have been rated erroneously as such. This criterion is followed only when the pleadings have to be construed in the context of a particular assertion and in that connection they could be said to be relevant for the ends of justice and not that they amount to proof.

103. Laches in pleading "mala fides in fact" obviously points out to giving a new text to a case different from that earlier pleaded for "malice in law" is distinct from "malice in fact". The High Court disposed of the plea of ladies on the ground of "terrorem", but the pleadings in substance in the original petition pointed distinctly to both- "mala fides in law" and not "mala fides in fact", and it was, therefore, that an exception was taken by the first appellant. Be that as it may, even such an amendment could not have been allowed without impleading late Zulfikar Ali Bhutto as a party in the proceedings as at that time he no longer held the office. If he had been joined as a party then he would have had an opportunity to rebut the mala fides imputed to him, and whether he could have succeeded in doing so was a different question. The High Court despite noticing the fact that he was c not joined as a party, yet held that he was maliciously disposed towards Inamur Rehman.

Such a finding could not have been given because of this fatal omission. Mala fides is not different from other imputations such as crime, moral delinquency and improper conduct, and the rule for establishing it is also the same. However, the High Court in holding mala fides against late Zulfikar Ali Bhutto overlooked the fundamental rule, that is, audi alteram partem the moreso when ma/a fides was regarded as having nexus with his official position. This Court has expressed strongly against the non-observance of this rule in Malik Firoz Khan Noon v. The. State (1) Muhammad Munir, C. J., while holding that a Judge ought not to make any disparaging remarks against a person who is neither a party nor a witness in the case referred to his earlier opinion in the matter of Expunging of remarks from Judgment (PLD 1950 Lah. 34 at p. 41), wherein he said : "A Judge who condemns a man unheard acts as unfairly as if he were to convert a man without hearing him in his defence. Persons who are attributed ignominious or improper conduct injudicial determinations, though they were neither parties nor witnesses in the cause, have, therefore, a just cause for complaint against this unfair treatment and the law reports are full of precedents where in the circumstances mentioned High Courts expunged the offending remarks. The need for caution in making such remarks is much greater where the person disparaged is a public servant acting in his own independent sphere. In such cases it is absolutely necessary that the Judge's suspicion about his conduct be communicated to him and an opportunity given to him to show- cause against the view that the Judge is inclined to take of his conduct."

104. Concluding, as I do, from the lengthy discourse on rnala fides I have reached the conclusion that the respondent has failed to establish personal mala fides against late Zulflkar Ali Bhutto or for that matter main fides against the second appellant or the Managing Director of the first appellant.

D There was legal flaw in the pleadings as because of waivering stand a different stages, and for the added reasons that the respondent had Palled to adduce evidence to establish mala fides as pleaded nonetheless the High Court gave credence to surmises, assumptions, assertions and bare.

Allegation {{FOOTNOTE}}

(1) PLD 1958 SC (Pak.) 333 of mala fides, such weight as amounted to proof in disregard of the principle that it required to be specifically pleaded and legal proof to establish it.

105. The High Court opened the gate for examining the mala fides in relation to legislative instrument primarily because it was of the opinion that such an examination was not overruled in Ziaur Rehman's case without noticing the distinction between the two clauses of Article 281 of the Interim Constitution (1972). Accordingly, it entered into an exercise to determine whether the impugned legislative instrument was conceived in bad faith or promulgated for any extraneous and collateral consideration and I repeat here that I had examined the factual mala fides and the necessity for the impugned legislation subject to the legal restraints, if any, to examine them including the question as to whether it was promulgated for an extraneous and collateral consideration. A contention was raised in the High Court on behalf of the appellants that mala fides could not be pleaded E against a Legislature and the legislative instillment, nor the question o malice or motives of the Legislature could be enquired into by the Courts, and the same contention is raised now. The controversy seems to hay manifested by the judgment of the Privy Council in the case of Emperor v. Benoari La! Sarma and others (1). In this case the validity of Ordinance (II of 1942) was in issue in the manner that the High Court of Calcutta by holding that it was ultra vires set aside the conviction of 15 persons by a Special Magistrate purporting to act under the impugned Ordinance. The Federal Court also held it to be ultra vires and thereupon the Governor General replaced it by Ordinance XIX of 1943. The Privy Council while holding the discussion as academic nonetheless examined the validity of this Ordinance both in view of the "elaborate argument addressed" and the way in which "the topic was dealt with" in the judgments of the Courts below. This Ordinance was held to be invalid either because the language of subsection (3) of section 1 of the Ordinance "showed that the Governor-General, notwithstanding the preamble, did not consider that an emergency existed but was making provision in case one should arise in future, or else because the section amounted to what was called delegated legislation by which the Governor-General without legal authority sought to pass the decision as to whether an emergency existed to the Provincial Government instead of deciding it for himself." In their Lordships' opinion there was no valid ground for either of these contentions.

106. Having said so their Lordships further observed that in the present instance such questions are immaterial, for at the date of the Ordinance no one could suggest that the situation in India "did not constitute an emergency of the most anxious kind." This was not all, their Lordships further held, that the question whether an emergency existed at the time when an Ordinance was made and promulgated was a matter of which the Governor-General was the sole judge, and for this the Privy Council relied on its earlier judgment in Bhagat Singh v. Emperor (2) while construing section 72 of the Government of India Act, 1919. In that case the observations were:- "The Governor-General is the judge of what conduces to the peace and good Government of British India. The power given by section 72 is an absolute power, without any limits prescribed, except only that it cannot do what the Indian Legislature would be unable to do, {{FOOTNOTE}}

(1) AIR 1945 p.c. 48 (2) A I-11, 1931 P C 111 ' although it is made clear that it is only to be used in extreme cases of necessity where the Government of India demands it."

And further "The Governor-General need not expound the reasons which induced him to promulgate an Ordinance, for it is not, in any way, incumbent on him as a matter of law."

As would appear from these observations, such power being absolute in nature it had to be exercised in extreme cases of necessity. Therefore, in my humble opinion, the Privy- Council having this judgment in view as a P matter of caution used the words "acts bona fide", without, in any way, making an in-road or desecrating the subjectivity of the satisfaction of the Governor-General. This I say so far in no earlier judgment has the Privy Council struck down a legislation on the ground of mala fides. On the contrary it has upheld the legislation where deception and mistake were pleaded. See Labrador Company v. The Queen (1). Again in Australian Communist Party v. The Commonwealth (2) it was held that if the opinion was to be that of the Governor-General, it cannot, in my opinion, be examined at all, for it was not open to impute mala fides with respect to an act of the King by himself or his representatives. Similarly in Duncan v. Theodore (3) it was held : "But in or opinion it is not open to impute mala fides with respect to the issue of a royal proclamation, which is the act of the King by himself or his representative." Here the exercise of statutory power was dependent on the declaration of the emergency ; and as it was already proclaimed on 3rd of September, 1939, the impugned Ordinance was issued under section 72, Schedule 9, Government of India Act, 1935. Construing this section, it was held by their Lordships that the language did not require to state that there was an emergency or what the emergency was either in the text of the Ordinance or at all, and while bolding so their Lordships observed "And assuming that he acts bona fide and in accordance with the statutory powers, it cannot rest with the Courts to challenge his view that the emergency exists."

' The exertion of power had direct nexus with that emergency, and hence the assumption as to his having acted bona fide did not arise directly or indirectly in the case. If I may say so with respect, it was an biter dictum wholly divorced from the controversy, and had no nexus with the exercise of legislative power. While setting aside the majority opinion of the Federal Court their Lordships held that the question whether an Ordinance was antra vires or ultra vires did not depend on the consideration of jurisprudence or of policy but rested simply on the examination of the language of the Government of India Act and the comparison with the legislative authority conferred on the Governor-General with the provisions of the Ordinance by which he purported to exercise his authority. Clearly, therefore, the limits within which the Court could have exercised its judicial power was succinctly laid down ; and if the Courts below had held it to be ultra vires it must be taken to mean a colourable legislation in the absence of the opinion of Governor-General as to the existence of an emergency for the exercise of legislative authority.

(1) (1893) A C 104 at p. 123 (2) (1950-51) 83 C L R 1 at p.

(3) (1916-17) 2$ L R 51Q {{FOOTNOTE}} 107.A colourable legislation is not the result of any mala fides, but conceptually colourability is bound up with incompetency, and takes the form of pretence or disguise for in substance and in reality it is a trans- egression of constitutional power. In Board of Trustees, Ayurvedic andl Unani Tibia College, Delhi v. State of Delhi (1) it was held that :-- "The doctrine of colourable legislation does not involve any question of bona fides or mala fides on the part of the Legislature. The whole doctrine resolves itself into the question of competency of a particular Legislature to enact a particular law. If the Legislature is competent to pass a particular law, the motives which impelled it to act are really irrelevant. On the other hand, if the Legislature lacks competency, the question of motives does not arise at all."

The same Court in a subsequent case, R. S. Joshi v. Ajit Mills Limited and another (2) Krishna Iyer, J.

Re-affirmed the same view "In the jurisprudence of power, colourable exercise of or fraud on legislative power or more slightly, fraud on the Constitution, are expressions which merely mean that the Legislature is incompetent to enact a particular law, although the label of competency is stuck on it. It is very important to notice that if the Legislature is competent to pass the particular law, the motives which impel it to pass the law are really irrelevant."

107.In F. B. Ali v. State (3) the vires of Ordinances III and IV of 1967 were impugned on the ground that the President had no power 4o promulgate them in the absence of any emergency, and to all intends and purposes they were colourable legislations. While considering the validity of the Ordinances this Court considered this objection as one of competence of Legislature in regard to legislative subjects and held that the impugned Ordinances were within the exclusive legislative competence of the Central Legislature and fell directly within items 1, 48 and 49 of the Third Schedule. Here also the colourability of the legislation was tagged with competency and resolved accordingly.

108.To sum up there is consensus of opinion that colourable legislation does not include the concept of mala fides or bona fides. On this view of the matter the assumption by the Privy Council as to the act bein bona fide when the Courts below had held it to be a colourable legislatio If could not be intended to mean to give power to the Court to enquir " into the motives of the Ordinance (II of 1942) competently legislated. A expressed earlier these words were used ex abundant cautela in the realm of necessity.

109.The High Court has principally accepted the opinion of Kaikaus, J. In Ch. Qaseem-ud-Din v. The Province of West Pakistan (4). Yaqub Ali, J. (as he then was) gave a,dissenting opinion but the case was not laid before the third Judge as in the meantime the impugned Ordinances were superseded by Acts of Legislature and the petitions were disposed of as having ,become infructuous. In this case the validity of Ordinances Nos. XII and XIV of 1958 passed by the Governor were challenged as it was contended that they were promulgated as apart of the election campaign of the Republican Party for the coming general elections in the country. These Ordinances indefinitely postponed 110.{{FOOTNOTE}}

(1) AIR 1962 SC 458 ,(2) AIR 1977 SC 2279

(3) PLD 1975 SC 506 (4) PLD 1959 Lab. 76 elections to the Corporation of the City of Lahore and substituted in the place of the Corporation, a body which consisted solely of persons nominated by the Provincial Government. The reasons which impelled B. Z. Kaikaus, J. To hold that an Ordinance could be attacked on the ground of mala fides was the quality of the act of the Governor and the enquire into the existence of condition precedent with reference to Articles 71(7) and 102 of the 1956 Constitution. The question he framed for being resolved was : "Whether the Governor who was entitled under some circumstances to legislate had acquired the power to legislate at all." In resolving this controversy the learned Judge did not concede the proposition that when the Governor under Article 102 made up his mind that an emergency existed, he attained a status like a Legislature because of its satisfaction of the existence of an emergency and if in enacting a law he abused his powers and used them for a collateral purpose his motives could not be questioned. His reasoning was that the Governor while acting under the second part of Article 102 was not an "autocrat" so much so that the legality of whose act could not be questioned despite the absence of emergency, a condition precedent, as then his act though legislative in character remained an act of the executive Government. It seemed to him that there was little difference between an ordinary act of the executive government and its act in promulgating an Ordinance and that if the public interest required, it was justifiable to inquire the mala fides. He appeared to be influenced, firstly, by the use of the word "bona fides" seven times in the case of Liversidge v. Anderson and another (1) to denote the quality of action of the Secretary of State for Home Affairs, and, secondly, the assumption of the words "acts bona fide" by the Privy Council in the case of Emperor v. Benoari Lal Sarma which according to the learned Judge meant that if he did not so act his action was liable to be challenged in Court and if a contrary view was taken then it must be held that the view of the Privy Council was not correct. The learned Judge held that it was impossible to hold an inquiry into the motives of a large body of legislators, but in that case too if there was a condition precedent than the Courts could inquire as to its existence or not. Concluding, the learned Judge held that the general rule as to the motives of the Legislature not being liable to be enquired into has no application to the case of an Ordinance.

111. Yaqub Ali, J. In his dissenting opinion, was of the view that any advice given by the Cabinet to the Governor under Article 71(7) in theory carried "with it the weight of the majority of the Members of the Assembly". Accordingly, the promulgation of the Ordinances was not an executive but a legislative act, which the Courts of law cannot set aside except by negating the authority of the Members of the Provincial Assembly to enact laws which lie within their competence under the Constitution. If the Cabinet acted mala fide the Constitution has itself provided political safeguards against it, that is, that the Ordinance which has the same force of law as an Act of the Provincial Assembly automatically expires after six weeks of the next session of the Assembly ; and it was left to the majority of the Members to re-enact it as "law" if they approved of its "sagacity" and "wisdom." If the Ordinance is not wished to be continued it was mandatory to lay it before the Assembly for the Members to question the Government as to {{FOOTNOTE}}

(1) (1941) 3 All E R 338 ' why it was necessary to promulgate it instead of bringing it before the House in the form of a Bill. In case of disapproval they can vote out of office the Council of Ministers responsible for their promulgation. Its life could also be cut down by disapproval by allowing it to die out six weeks later.

His conclusion turns on the "constitutionality" of legislation as under :- "In case Courts of law were to interfere in such political matters, it is obvious they will be drawing themselves into unseemly conflicts with political authority in the country, and this consideration alone, as a rule of public policy, must restrain them from enlarging their jurisdiction to such domains, e.g. It was not denied that the West Pakistan Assembly could enact the impugned Ordinances as valid laws. What would then be the value or respect for the opinion expressed by the Court based upon considerations of jurisprudence or of policy?"

' According to him, his opinion found support from Article 102 which provided that an Ordinance made shall have the like force of law as any act of the Provincial Legislature and this prevented any distinction to be made between an act of Provincial Legislature and an Ordinance promulgated by the Governor under Article 102 so far as the mala fides or abuse of power in enacting it was concerned. The learned Judge distinguished the cases of Emperor v. Sibnath. Banerji and others (1), Liversidge v. Anderson and another and Greene v. ,Secretary of State (2) on the short ground that the word "bona fide" was used in relation to orders of an executive nature and for the other reason of non-compliance with the statute. As for the satisfaction of the Governor being justiciable, the learned Judge held that it was subjective, and, therefore, did not conform to any external standard or criterion. This being so how could it be disapproved by reference to an inquiry conducted by a Court and what evidence could be found to indicate the state of the mind of the Governor to measure the quantum of his satisfaction. Further it was held that the impolicy and the injurious consequences of the Ordinance, cannot be the criterion for judging the state of mind of the Governor, and the Courts ought to enforce the laws of the country and not to legislate on considerations of jurisprudence and policy. The learned Judge distinguished the case of Emperor v.

Benoari Lai Sarma firstly, on the ground that their Lordships did not consider section 306(1) of the Government of India Act, 1935, while making that assumption as the Governor was not answerable to any Court for the exercise of his legislative function, and, therefore, his satisfaction could not be the subject-matter of an inquiry. Secondly, if Article 71(7) was pressed into service then Article 213 became nugatory for in its scope it was not limited to acts which the Governor exercised in his individual discretion but also his acts which he performed on the advice of the Cabinet.

Accordingly, the action taken by him on the advice of his Cabinet was as much his own act as those which he performed in the exercise of his discretion, and, therefore, it could not be regarded as an executive act of the government but must be of a legislative character. I would refer to an illuminating passage from his opinion :-- "In the light of the constitutional bar, contained in Article 213, would {{FOOTNOTE}}

(1) AIR 1945 P C 156 (2) (1941) 3 All E R 388 ' it not follow that Courts are precluded from judging the state of the Governor's mind for in order to do so, the Governor must be answerable to the Courts of law. This, of course, does not mean that all the acts of the Governor, whether performed by him or by other public officers in his name, cannot be challenged in Courts on other grounds. The proviso to Article 213 itself makes that provision, but surely in an appropriate proceeding against the Provincial Government the latter analysis and interpretation of Articles 71(7) and 213 is correct, then the observation of their Lordships of the Judicial Committee in Emperor v. Benoari Lal Sarma, "assuming that he acts bona fide" which is in the nature of obiter dictum loses much of its force because there were provisions . Analogous to the aforesaid provisions of or Constitution in the Government of India Act, and their Lordships did not refer to them ; indeed for the simple reason that the plea of mala fide was never raised in that case. In Liversidge v. Anderson, the House of Lords did observe, "provided the Secretary of States acted in "good faith," and no one can deny that all executive acts can be set aside as mala fide acts, but as I have shown above, the "satisfaction" of the Governor under Article 102 is a legislative act and there is no means of enquiring into his state of mind."

' Here I may highlight that the learned Judge relied also on the observations of their Lordships of the Privy Council in Emperor v. Benoari Lal Sarma while setting aside the opinion of the Federal Court as also in effect excluding the inquiry into the motives of the Governor-General, while promulgating Ordinance (H of 1942).

112. Finally in his dissenting opinion this is what the learned Judge observed :- "The principle on which the Courts are debarred from sitting in judgment on the Legislature, therefore, is not that it is not possible or it is extremely difficult to prove that its members had acted bona fide, or that a fraud was played upon them, or that he had made a mistake, but the Courts being themselves creatures of law must give effect to the laws of the country irrespective of the considerations of jurisprudence or of policy and that intro vires or ultra uires of an Act or an Ordinance depend simply on examining the competence of the legislative authority which enacts them and by no other criterion. The Indian High Courts are also of the same view and some of their judgments which were cited by the learned counsel for the respondents have been noticed by my learned brother in his separate judgment. It. Is, therefore, necessary to mention them here, but before concluding this judgment I feel tempted to reproduce the following passage at page 715 of the Third Edition of Basu's Commentary on the Constitution of India, under Article 123 :- "The satisfaction referred to in this clause is the satisfaction of the President. The President is not bound to expound reasons for promulgating an Ordinance or to prove them affirmatively in a Court of law. He is the sole judge of the question whether circumstances exist which call for immediate legislation by Ordinance. The existence of such necessity is not a justiciable matter which the Courts could be called upon to determine by applying an objective test. Even if the President states the reasons which satisfied him as to the necessity of immediate action, the Courts cannot question the bona fides of such action."

113.The opinion' Of Kaikaus, J., eminently did not give effect to the constitutional provision which placed an Ordinance at par with an Act of Provincial Legislature and gave to it the same protection. Seemingly enough, the learned Judge on a criterion not legally discernible treated the Ordinance as an executive act of the government. Additionally Article 213 of the Constitution also came in the way of such determination. If, as conceded, it was practically impossible to enquire into the motives of a large number of legislators then equally the motive of the Governor-General could not be enquired into as on principle no distinction could be made between an Ordinance and an Act. The learned Judge, if I may say so with respect, struck down the legislation by reference to motive upon which the constitutionality of the Act did not depend, but exclusively upon the power it gave to legislate. This principle was clearly discernible from the judgment of the Federal Court in the case of the Pakistan Province v. Malik Khizar Hayat Khan Tiwana (1), but the learned Judge did not place any weight on it, as according to him, it gave no reason although he was bound to follow it. His line of approach concerned itself more with the so-called assumption by the Privy Council of the act being "bona fide" in the case of Benoari Lal Sarma, which according to the opinion of Yaqub Ali, J., was obiter dictum as the satisfaction of the Governor-General was subjective and that he was not answerable to any Court for such legislation under a constitutional provision, and also for the further reason that the constitutionality of the Ordinance did not depend upon any rule of jurisprudence or policy but on the examination of the constitutional provision vis- a-vis the legislative authority conferred thereunder and the provisions of the Ordinance.

114.' The opinion of Yaqub Ali, J., does not stand alone. But is augmented by a plethora of case-law and the opinions of the notable jurists, which I shall presently consider : ' Schwartz in his Commentary on the Constitution of the United States, Volume I, 1977 Edition, at page 226 says : "To hold that constitutionality turns, not upon power, but upon the motives of the Legislature is to make the Constitution depend upon subjective tests, utterly vague in their application. The Congress could never pass a law without inquisition into the motive of every member, nay, even then, they would be re-examinable by the Courts, No government on earth could rest for a moment on such a foundation. It would be a constitution of sand heaped up and dissolved by the flux and reflux of every tide of opinion."

' Cooley in his treatise on "Constitutional Limitations", Volume I, at pages 379 and 380, speaks thus : "From what examination has been given to this subject, it appears that whether a statute is constitutional or not is always a question of power ; that is, a question whether the Legislature in the particular case, in respect to the subject-matter of the act, the manner in which its object is to be accomplished, and the mode of enacting it, has kept within the constitutional limits and observed the constitutional conditions. In any case in which this question {{FOOTNOTE}}

(1) PLD 1956 FC 200 ' is answered in the affirmative, the Courts are not at liberty to enquire into the proper exercise of the power. They must assume that legislative discretion has been properly exercised. If evidence was required, it must be supposed that it was before the Legislature when the act was passed ; and if any special finding was required to warrant the passage of the particular act, it would seem that the passage of the act itself might be held equivalent to such finding. And although it has sometimes been urged at the bar that the Courts ought to enquire into the motives of the Legislature where fraud and corruption were alleged, and annul their action if the allegations were established the argument has in no case been acceded to by the judiciary, and they have never allowed the inquiry to be entered upon. The reasons are the same here as those which preclude an inquiry into the motives of the governor in the exercise of a discretion vested in him exclusively. He is responsible for his acts in such a case, not to the Courts, but to the people."

' In McCray v. United States (1), White' J., said : "It is, however, argued, if a lawful power may be exerted for an unlawful purpose, and thus, by abusing the power, it may be made to accomplish a result not intended by the Constitution, all limitations of power must disappear, and the grave function lodged in the judiciary, to confine all the departments within the authority conferred by the Constitution, will be of no avail. This, when reduced to its last analysis, comes to this, that, because a particular department of the government may exert its lawful powers with the object or notive of reaching an end not justified, therefore it becomes the duty of the judiciary to restrain the exercise of a lawful power wherever it seems to the judicial mind that such lawful power has been abused. But this reduces itself to the contention that, under or constitutional system, the abuse by one department of the government of its lawful powers is to be corrected by the abuse of its powers by another department. The proposition, if sustained, would destroy all distinction between the powers of the respective departments of the government, would put an end to that confidence and respect for each other which it was the purpose of the Constitution to uphold, and would thus be full of danger to the permanence of or institutions. ... It is, of course, true, as suggested, that if there be no authority in the judiciary to restrain a lawful exercise of power by another department of the government, where a wrong motive or purpose has impelled to the exertions of the power, that abuses of a power conferred may be temporarily effectual. The remedy for this/however, lies, not in the abuse by the judicial authority of its functions, but in the people, upon whom, after all, under or institutions, reliance must be placed for the correction of abuses committed in the exercise of a lawful power."

' Willoughby in his book on the "Constitution of the United States", Volume I, page 30 expresses thus.

"With the motives of the Legislature the Courts do not concern themselves. The judiciary can only inquire whether the means {{FOOTNOTE}} 11) 49 .1 aw Ed. 73 devised in the execution of a power granted are forbidden by the Constitution. It cannot go beyond that inquiry without intrenching upon the domain of another department of government. That it may not do with safety to or institutions."

In Corpus Juris Secundum, Volume 16, page 809, S. 154, it is so expressed : "It is a well-settled rule that in determining the validity of an enactment, the judiciary will not enquire into the motives or reasons of the Legislature or of the members thereof. This rule is even carried to the extent of excluding consideration of duress, fraud, or corruption in the passage of the act."

115.The Supreme Court of America has firmly held in several cases that the exercise of legislative power has no nexus with motive. I have earlier referred to some of the cases while considering the question as to whether the legislative motives can be enquired into and it would suffice here to cite them: Henry Amy v. The City of Watertown 32 Law. Ed. 946 ; United States v. The Des Moines Navigation & Railway Company 35 Law. Ed. 1099 ; Lawrence Weber v. Frederick S. Freed, 60 Law. Ed. 308 and Elwood Hamilton v. Kentucky Distilleries, 64 Law Ed.

145.

Similarly the English Courts have also exercised a restraint in encroaching upon the powers of the Parliament to enquire into the motives of legislation. I have referred earlier to those decisions, which I shall presently sum up. These are : Edinburgh & Delkeith Railway Co. v. Wauchope (1842) 8 Cl. & F 710 at p. 724 ; Lee v . Bude & Torrington Junction Railway Co., (1871) L R 6 CP 576 ; Hollinshead v. Hazleton (1916) A C 428 ; River Wear Commissioners v. Adamson (1877) 2 A C 743 ; British Railway Board v. Pickin (1974) 1 All E R 609 and Smith v. East Elloe Rural District Council (1956) A C 736.

115.In the case of the State v. Zia-ur-Rehman (1), Hamoodur Rahman, C. J., held that the judicial power could not be exerted beyond what the constitutional provisions required, as would appear from his observations at page 70 of the report : "On the other hand it is equally important to remember that it is not the function of the judiciary to legislate or to question the wisdom of the Legislature in making a particular law if it has made it competently without transgressing the limitations of the Constitution. Again if a law has been competently and validly made the judiciary cannot refuse to enforce it even if the result of it be to nullify its own decisions. The Legislature has also every right to change, amend or clarify the law if the judiciary has found that the language used by the Legislature conveys an intent different from that which was sought to be conveyed by it. The Legislature which establishes a particular, Court may also, if it so desires, abolish it,"

115.The words "competently" and "validly" here have reference to the authority of the particular Legislature to legislate in regard to {{FOOTNOTE}}

(1) PLD 1973 S 49 legislative lists and other constitutional limitations. Clearly from these observations the exertion of the legislative power, either by the elected Assembly or the President, is not made dependent on any motive, wisdom, policy or impolicy or any rule of jurisprudence etc. And further it seeks to avoid a conflict between the two functional organs of the State. (See also Umyal Achi v. Lakshmi Achi (1), Tariq Trasport Co. v. SargodhaBhera Bus Service (2), Mr. FazIul Quader Chowdhry v. Mr. Muhammad Abdul Hague (3) and Mr. A. K. Fazalul Quader Chaudhry v. Syed Shah Nawaz (4). Again the observations of Hamoodur Rehman, C. J. Undoubtedly bear out that the constitutionality of an act depends upon Jj the exercise of power within constitutional limits and not upon motive or any other consideration.

118. The learned counsel for the respondent relied on Ch. Zahur Ilahi v. Zulfikar Ali Bhutto (5), to contend that "Immunity cannot extend to illegal or unconstitutional acts" if motive was the reason for promulgating the impugned legislative instrument. In other words what was urged was that there was no legal exercise of power because of mala fides. In this behalf he relied on the observations at page 393 of the report, which in effect lay down that neither the Constitution nor any law can possibly authorise the Prime Minister to commit a criminal act or do anything which is contrary to law as he is bound to obey the Constitution and the law under Article 5(2) of the 1973 Constitution. (See Article 4 of the 1962 Constitution and Article 5 of the Interim Constitution, 1972).

Here I would refer to Article 117 of the 1962 Constitution, which gave protection to the President in respect of his official acts and he was not answerable to any Court. Similarly Article 263 of the Interim Constitution of 1972, gave to him complete immunity and the same was extended to him under Article 248(2) of the 1973 Constitution. From these provisions it is obvious that the President was not answerable to any Court for the exercise of his legislative functions and for the reason it was not possible to enquire into the motives of any legislation promulgated by him ; but as has been discussed above, the exercise of the legislative authority has no nexus with the motive, therefore, I find no analogy from the rule laid down in Zahur Ilahi's case, where the Prime Minister's conduct in having committed contempt of Court was under consideration vis-a-vis the immunity .Granted to him under Article 248 of the 1973 Constitution. It rather seems to me that reliance was placed on this decision to contend that mala fides supervened the exercise of the legislative power by late Zulfikar Ali Bhutto while promulgating the impugned legislative instrument the moreso as his political status was no different from Yahya Khan. The assumption of the High Court as to his being a usurper is not spelt out from the observations of Hamoodur Rahman, C. J., in Asma Jilani's case as he chose not to give any opinion. However, he made it plain that his decision was confined to the question as to the validity of the Presidential Order No. .3 of 1969 and Martial Law Regulation No. 78 of 1971. There was thus no expression of opinion as to the legislation promulgated by late Zulfikar Ali Bhutto. Yaqub Ali, J., however, at page 250 of the report held that the {{FOOTNOTE}}

(1) AIR 1945 P C 25 (2) PLD 1958 SC (Pak.) 437

(3) PLD 1963 SC 486 (4) PLD 1966 SC 105

(5) PLD 1975 SC 31;3 assumption of power by late Zulfikar Ali Bhutto was legal. In Zia-ur-Rehman' s case the legal existence of the constituent Assembly, as then represented, was accepted and so also the written Constitution enacted by it. His being Leader of the majority party was also not doubted. I this background it is difficult to accept that his assumption of office the President and the Chief Martial Law Administrator was of the Sam pattern as that of General Agha Muhammad Yahya Khan. Be that as it May, in that capacity if he exercised legislative functions then conceptually the exercise of the power could not be dependent on any motive if judged by the constitutional provisions of the 1962 Constitution. In the alternate, in the state of the Legal Order, as then existing, late Zulfika L Ali Bhutto was a repository of power, and conceptually there was no constraint on such power. Willis says that no statutory, legal or constitutional limits to power are recognised. (Willis on Constitutional Law). Further it had no nexus with mala fides. Like an immunity provision in the Constitution, he was not answerable to any Court and tacitly for that reason it was impossible to enquire into the motive of the impugned legislative instrument.

119.The principle of non-sharing of collective responsibility by an individual as a distinctive feature has not evolved itself as a judicially recognised principle except for the lone .Opinion of B. Z.

Kaikaus, J., which ran counter to the concept of the exertion of power and the constitutional parity given to an Ordinance. Accordingly, the distinction sought to be made out was not real but imaginary.

119.The apprehensions expressed for the abuse of power are also of no distinctive value as they were speculated from the opinion of B. Z. Kaikaus, J., in Qaseem-ud-Din's case and on no principle can such 0 apprehensions be regarded as constraints on the power itself. To say that the legislative instrument would not be sacrosanct if is promulgated by an individual is to defect the constitutional sanctity given to it.

120.Carrying the discussion further it is explicit from Yaqub Ali, J.'s opinion in Qaseem-ud-Din's case that if political safeguards in the Constitution are overlooked and the legislation is struck off on the ground of mala fides then there is a possibility of conflict of judicial power with the political power of the Government and this would entail a mutual destruction of the functional organs of the State.

In similar terms is the judgment of this Court in Ahmed Saeed Kirmani's case ('1). Run that case it was held that the internal proceedings of a Provincial. Assembly did not fall within the corrective jurisdiction of the Court on the principle that any interference with the internal proceedings of a Provincial Assembly would destroy the compromise represented by the Constitution, between the great powers whose equilibrium inter se is the only guarantee of the freedom and the well-being of the country. . As to the internal proceedings being vitiated by coercion, duress and mala fides, it was held that they were "wholly outside the corrective jurisdiction or the High Court", for "the means of correction", which are contemplated by the Constitution providing for a form of parliamentary government or in matters of this kind involving coercion or mala fides were exclusively of a political kind. Elaborating the principle further Cornelius, J., observed : "It appears to me to be unconceivable that a decision so taken, where the division, of Members of the House is on party lines, can be subjected to examination and either confirmation or rejection by the {{FOOTNOTE}}

(1) PLD 1958 SC (Pak.) 397

(1) 56 Law. Ed. 377 (2) 56 Law Ed. 386 Courts, that one of two extreme dangers arising to the integrity of the very fabric upon which the Constitution is based. Either the authority of the Legislative Assembly, which is to be asserted by the fact of a majority of the Members being in favour of a proposition, will be irretrievably destroyed in the process, should the Courts prevail, or in the alternative, the authority and the whole standing of the Courts will be incurably diminished, and the High position which is given to them in the balance of powers within the Constitution, will be prejudiced in such a way, as to render their functioning serveless and even possibly of danger in the body politic, were they ever to attempt to resolve disputes between contending political parties inside the House, on the basis of justice, equity and good conscience."-(p. 415)

122.On principle there is no distinction between an Act and Ordinance as both are the product of the exercise of legislative power. Q Therefore, it leads to the same conflict if it were to be struck down on the If ground of mala fides, a contingency which has been strongly deprecated for the all embracing reasons in the aforementioned decision. In Zia-urRehman's case, Hamoodur Rahman, C. J., expressed himself alike at page 77 of the report: "With political decisions or decisions on questions of policy, the judiciary is not concerned. Its function is to enforce the Constitution and to see that the other organs of the State confine themselves within the limitations prescribed therein".

123.A. G. W. Chaudhry, in his book on "Constitutional Rights and Limitations", Volume II, 1958 Edition at page 1340, has re-affirmed this view relying on the two cases of the Supreme Court of America, namely, Pacific States Telephone & Telegraph Company v. State of Oregon (1) and Frank Kiernan v.

City of Porthland (2), in these words : "Political questions are not within the province of the judiciary except to the extent that power to deal with such questions have been conferred on the Courts by express constitutional or statutory provisions. By political questions is meant questions, which under the Constitution are to be decided by the people in their sovereign capacity, or in regard to which full discretionary authority has been delegated to the legislative or executive branch of government."

122.William 0. Douglas, while dealing with the limitations on judicial power at pages 55 and 56 of his book, "We the Judges", says : "The influences behind the development of the law on political, as distinguished from justiciable, questions are numerous. Certainly the fact that the Judges, were the agents of the King made them reluctant to entertain actions that might thwart his will or embroil them in controversies with the Crown. From that beginning, the roots of the doctrine spread. For various reasons, Judges adopted a self-denying policy, keeping hands off many disputes."

And further : "On the domestic front too, there are methods of settling controversies without going into the Courts. The executive and legislative departments have their own procedures and devices. For example a question may arise whether a Senator or Congressman should be seated, in the Congress. Article 1, section 5 of the United States Constitution provides that "Each House shall be the Judge of the Elections, Returns and Qualifications of its own Members". Hence contests over the seating of rival candidates for the Congress are political, not justiciable, under the American Constitution. I note the analogy in the Indian Constitution contained in Article 103, giving the President, "final" decision on the question whether a member of the Parliament has become disqualified to serve."

125.What is said above goes a long way to fortify the curb on judicial power in matters involving conflict between the functional organs of the State and the wisdom underlying it for maintaining an equilibrium inter se between them.

126.The High Court did not give any weight to the opinion of Yaqub Ali, J., for the reason that he had changed his opinion in Asma Jilani's case. This conclusion is misconceived as in that case Yaqub Ali, J., merely examined the validity of Presidential Order No. 3 and Martial Law Regulation No. 78 of 1971 for determining as to whether they qualified as law within the meaning of term "law" in Article 2 of the 1962 Constitution as they were promulgated by a usurper. This had no relevance to the Ordinance issued under a constitutional provision whose validity he had upheld in his dissenting opinion and ought it be said that in the same judgment he took notice of Articles 280 and 281 of the Interim Constitution of 1972 published in the form of a draft and held that now they had become valid because the new Constitution of the State adopted them "as constituents of the National.

Legal Orders as from the commencing day i.e. 21st of April, 1972, with retrospective effect from the 25th of March, 1969". In not accepting the opinion of Yaqub Ali, J., the High Court did not examine his reasons in favour of the constitutionality of the legislation nor gave any justifiable reasons for accepting the opinion of B. Z. Kaikaus, J., evolving a distinction between an Ordinance and an Act qua the inquiry as . To mala fides. I fail to see how the High Court could without looking into the constitutional provisions give a finding of such far-reaching consequence.

127.The High Court next misplaced its reliance on Madhav Rao Scindia v. Union of India (1). In this case by a laconic order dated 6th of September, 1970, the President of India under Article 366(22) of the Constitution, withdrew recognition of certain Rulers including his Highness Maharaja Dhiraja Madhav Rao Jiwaji Rao Scindia Bahadur, the Ruler of Gwalior. This action was challenged as it was in disregard of the guarantees and assurances available under Articles 291 and 362 of the Constitution. Undoubtedly it was an executive exercise of power which under Article 73 of the Constitution was conterminous with the law-making power of the Parliament. Before this action the Parliament refused to legislate so as to deprive them of the recognition and the Privy Purses. It was contended by the learned counsel for the Ruler that this act of the President lacked bona fides, without pleading any collateral fact, but this objection was overruled on the ground that neither under the constitutional provision it was open to probe the reasons, which impelled the President to take the decision, nor the advice tendered to the President by the Ministers was open to inquiry nor the President was answerable to any {{FOOTNOTE}} (1)AIR1971SC5O Court for the exercise and performance of his powers and duties of his office or for any act done or purporting to be done by him in the exercise of those powers. All that was saved were the appropriate proceedings against the Government of India, wherein the question whether the President acted rightly or wrongly could be decided against the Government of India without questioning the conduct of the President. Therefore, the only question open was whether the act of the President was ultra vires the Constitution. The principal consideration for holding his act as ultra vires was that after the refusal by Parliament to amend the Constitution the President's power did not extend that far by executive action. Accordingly, the case was decided on the premise of violation of a constitutional provision without reference to any bad faith, which was not a relevant consideration.

128.The High Court from paragraph 271 of the judgment of Hegde, J., drew the conclusion that "it would thus appear that any exercise of power for collateral purpose according to Hegde, J., could invalidate a law, but since the Ruler had not pleaded mala fides against the President of India, the case was not dealt with on that basis". As held by Ifidayatullah, C. J., the President was not answerable to any Court, and, therefore, his conduct could not be examined qua the state of his mind. If constitutionally there was a bar ; how could then mala fides be relevant even if it was pleaded. The conclusion of Hegde, J., was also that the impugned order was ultra vires the Constitution. The High Court without noticing that the conduct of the President was not open to inquiry nonetheless held that mala fides would have been examined if pleaded. This was an erroneous assumption in view of the constitutional bar. The ratio decidendi of this case thus does not advance the case of the respondent in regard to supervening mala fides as contended.

129.The High Court lastly relied on the opinion of Muhammad Akram, J., in the case of Begum Nusrat Bhutto v. Chief of Army Staff (1), wherein he held that "morality cannot be divorced from law' , to highlight that the impugned legislative instrument was immoral as it was the result of the mala fide exercise of legislative power, and, therefore, did not qualify as law. However, the High Court overlooked what this Court held in F. B. Ali's case where also it was contended that the Ordinances were not law in terms of Fundamental Right No. 1 of the 1962 Constitution as they purported to unreasonably deprive a citizen of the norms of a judicial trial. While overruling this contention, Hamoodur Rahman, C., J., observed "But this generalization cannot be accepted. Law has not been defined in the Constitution of 1962 and, therefore, in its generally accepted connotation, it mean& positive law, that is to say, a formal pronouncement of the will of a competent law-ginner. There is no such condition that a law must in order to qualify as . a law also be based on reason or morality.

The Courts cannot strike down a law on any such higher ethical notions nor can Courts act on the basis of philosophical concepts of law as pointed out by me in the case of Asma Jilani PLD 1972 SC 139. This claim was abandoned even in England as long ago as 1871 when Willes, J., in the case of Lee v. Bude & Torrington Junction Railway Co., L R 1871 C P 576/582, said :- {{FOOTNOTE}}

(1) PLD 1977 SC 657 "We sit here as servants of the Queen and the Legislature. Are we to act as regents over what is done by Parliament with the consent of the Queen, Lords and Commons ? I deny that any such authority exists ........................... The proceedings here are judicial, and autocratic, which they would be if we could make laws instead of administering them."

Dr. C. K. Allen in his book 'Law in the Making', 7th Edition, page 450, has categorically stated that he was unable to find "a single example in or books of the Courts rejecting the plain and express provisions of a statute on the ground that it was contrary to any ethical principle". In the circumstances, I too find myself unable to say that the impugned Ordinances are not law and, therefore, violating of Fundamental Right No. 1."

' I had referred to this English case earlier in the discussion on another to and relied on the same passage for holding that the judicial power cannot overreach the legislative department so as to enable an inquiry to be initiated into the motives of legislation.

130.In Manzoor Elahi v. Federation of Pakistan (1), a wider meaning was given to the expression "law" as used in Article 2 and Fundamental Right No. 1 of the 1962 Constitution so as to include not only statute law but also the judicial principles laid down from time to time by the superior Courts and judicial norms obtaining in Pakistan. This wider connotation of the word "law" was rejected later in F.

B. Ali's case, which view was re-affirmed in Federation of Pakistan v. United Sugar Mills .Ltd. (2). In this view of the matter, I fail to see how the Court could have placed reliance on the opinion of Muhammad Akram, J., which was not the decision of the Court in the case and ignore judgments of this Court in which ethical as well as philosophical concepts of law were brushed aside and a precise meaning to the word law' was given as `statute law'.

131.Here. I would like to dispose of the reply of Mr. Shah Jamil Alam in not filing the counter-affidavit on behalf of the second appellant on the ground that the allegations of mala fides were directed against Mr. Zulfikar Ali Bhutto and not against the second appellant, which was not accepted by the High. Court. No allegations of mala fides were made against the Federation of Pakistan but the High Court while evaluating this submission held that except for the allegation regarding the making of speech by late Zulfikar Ali Bhutto during his election campaign in 1970, the other grounds were directed against him in his official capacity as the President and the Chief Martial Law Administrator, and, therefore, they needed to be rebutted. As the President and the Chief Martial Law Administrator was not answerable to any Court, therefore, if a finding was given it could only be against the Federation of Pakistan but without questioning the conduct of the President. It could not, accordingly, embrace .Any element of mala fides but could only directed to the determination of the question such as whether the President acted rightly or wrongly in promulgating the impugned legislative instrument, i.e., whether or not for a collateral purpose. I fail to see an result from the non-rebuttal of the. Allegations by the Federation of Pakistan when the decision could not turn on the supervening mala fides, if any, of the President and the Chief Martial Law Administrator. {{FOOTNOTE}}

(1) PLD 1975 SC 66 (2) PLD 1977 SC 397 ' to a measure which is essentially criminal. Every law which makes criminal an act which was innocent when done, or which inflicts a greater punishment than the law annexed to the crime when committed, is an ex post facto law within the prohibition of the Constitution."

Such a constitutional bar is not in or constitutional system, but an analogy is drawn from the American cases which have dealt with thiq provision of the Americat Constitution.

321. It was contended in Kariapper v. Wijesinha (1) that the act was a bill of attainder or bill of pains or bill of penalties, but the Privy Council rejected this contention upon the "valuable guidance" available in the opinion of Frankfurter J., in the United States v. Lovett (2), pp. 322-324: "All bills of attainder specify the offence for which the attainted person was deemed guilty and for which the punishment was imposed."

' Giving his reason for rejecting the contention that the act was a bill of attainder, Frankfurter. J., said : "No offence is specified and no declaration of guilt is made.-Not only does section 304 lack the essential declaration of guilt. It likewise lacks the imposition of punishment in the sense appropriate for bills of attainder Punishment presupposes an offence, not necessarily an act previously declared criminal, but an act for which retribution is exacted. The fact that harm is inflicted by governmental authority does not make it punishment. Figuratively speaking all discomforting action may be deemed punishment because it deprives of what otherwise would be enjoyed. But there may be reasons other than punitive for such deprivation. A man may be forbidden to practice medicine because he has been convicted of a felony...Or because he is no longer qualified The deprivation of any rights, civil or political, previously enjoyed, may be punishment, the circumstances attending and the causes of the deprivation determining this fact.

Cummings v. State of Missouri.

322. It would be obvious from the impugned legislative instrument that neither any body was condemned nor punished nor was their an adjudication of any case or controversy, and all that the impugned legislative instrument achieved was to take over the Mill to secure and protect large public-funds. The learned counsel for the respondent relied on the dissenting opinion of Burger, Ch. J., in Nixon v. Administrator of General Services (3), at p. 870, who held that The Act violated the bill of attainder clause of the constitution, since it applied only to one former President, not all Presidents and since it deprived him of the established property right of the President in the control of his Presidential papers and of the right of a former President to have a Presidential Library at a facility of his own choosing for the deposit of such Presidential Papers as he unilaterally selected, retributive motives on the ten of Congress being irrelevant to bill of attainder analysis, and Mr. Nixon's {{FOOTNOTE}}

(1) (1967) 3 All E R 485 (2) 328 U S 303

(3) 53 Law. Ed. 2d 867 "uniqueness" because of his resignation and acceptance of a pardon and justifying the Act."

' But this is neither the opinion of the Court on this point nor can it be relied as it rests on the constitutional provision of the American constitution.

323. The learned counsel for the respondent also relied on Cummings v. Missouri (1), Fletcher N.

Peck (2), United States v. O'brien (3), United States v. Lovett (4) and Liyanage v. Reginam (5).

324. In Cummings v. Missouri, the Supreme Court held that the embargo on legislation was not confined to deprivation of life, liberty or property, but also embraces deprivation of the rights civil or political, previously enjoyed, or disqualification from the pursuits of lawful avocation or from privileges of appearing in the Courts, or acting as executor, administrator or guardian. It is apparent that the Supreme Court has while construing this constitutional provision extended its scope to other matters also. But from such a conclusion the validity of the impugned legislative instrument cannot be tested as in or constitutional system th touchstone is the constitutional provision and not other matters extraneous,R to it. If the deprivation of the property violates a constitutional provision then. And only then can the law be declared as void.

325. In Fletcher v. Peck, the emphasis was on the constitutional provision which is said to be a limitation on the power of the Legislature. "over the lives and fortunes of the individuals." But again the question is as to whether this provision can be pressed into service to strike down a law under or constitutional system.

326. In United States v. O'brien, the three definitional elements of bill of attainder were highlighted, namely, identification of the individual, punishment, and lack of judicial trial, and it was said that if a legislation is to be attacked on the ground that it was a bill of attainder an analysis is necessary for ,finding out as to whether these elements exist. How far this judgment is helpful, I am unable to gather as again it deals with the content of the bill of attainder.

327. In United States v. Lovett, it was held that: "an act of Congress operating permanently to exclude certain individuals from governmental employment is a bill of attainder within the constitutional prohibition of such bills." Frankfurter, J., in his separate opinion has highlighted the origin of a bill of attainder in these words : "A bill of attainder, by the common law, as or fathers imported it from England and practised it themselves, before the adoption of. The Constitution, was an act of sovereign power in the form of a special statute...By which man was pronounced guilty or attainted of some crime, and punished by deprivation of his vested rights, without trial or judgment per legem terrae." Farrer, Manual of the Constitution (1867) 419. And see 2 Story. Commentaries on the Constitution (5th ed, 1891) 216 ; 1 Cooley, Constitutional Limitations, 8th ed, 1927, 536. It was this very special, narrowly restricted, intervention by the Legislature, in matters for which a {{FOOTNOTE}}

(1) 18 Law. Ed.. 356 (2) 3 Law. Ed. 162

(3) 20 Law. Ed. 673 (4) 90 Law. Ed. 1252

(5) (1966) 1 All E B. 650 ' decent regard for men's interests' indicated a judicial trial, that the Constitution prohibited. It must be recalled that the Constitution was framed in an era when dispensing justice was a well- established function of the Legislature. The prohibition against bills of attainder must be viewed in the background of the historic situation when moves in specific litigation that are now the conventional and, for the most part, the exclusive concern of Courts were common place legislative practices."

(P. 1263 of the Report)

In the historical background highlighted, it was to protect legislative punishments that a provision was enacted in the American constitution. It is not possible to bring home this consideration while considering the validity of a legislation under or constitutional system.

328. In Liynage v. Reginam, the reason which impelled the Privy Council to hold that : "The acts were in exercise of judicial power", was firstly, that it altered ex post facto punishment and secondly, the compulsion to import a particular term of imprisonment, and thirdly, forfeiture of property. What was accordingly held in this case could not by any analogy apply to the impugned legislative instrument which fails to satisfy the requirement of ex post facto punishment. The American Courts have construed the constitutional provisions relating to bill of attainder as also to include a bill of pains and penalties. This is the marked feature of the American decisions, but in or constitutional system 6 neither the bill of attainder nor its extended scope can be the criterion for testing the validity of legislative instrument. Accordingly, it is not possible to conclude that the dissolution of the Company was a legislative punishment on the premise, as contended, that the respondent not only suffered pecuniary loss but was also deprived of his rights as a shareholder.

329. There is no bar in or constitutional system against ex post facto legislation. In this connection a reference may be made to Piare Dusadh's case where the wires of the ex post facto legislation was examined with reference to the competency of the Legislature with regard to the legislative subjects. This is the test for determining its validity. In Zia-ur-Rahman's case, Hamoodur Rahman, C. J., also reiterated it in the following words : "The Legislature has also every right to change, amend or clarify the law if the judiciary has found that the language used by the Legislature conveys an intent different from that which was sought to be conveyed by it."

In practice, there are numerous instances of ex post facto legislations and u none of them have been struck down on the criterion that the Legislature was debarred from legislating retrospectively.

330. It was next urged that the power of legislation in an Islamic. State is not absolutely unfettered but is circumscribed by the limits imposed by the immutable Divine laws as contained in the Holy Qur'an and Sunnah. Therefore, the Legislature of an Islamic State cannot legislate. Or declare as lawful which has been forbidden in: Islam. In this context it was contended that the impugned legislative instrument (M. L. R. 103) was against the injunctions of Islam as laid down in the Holy Qur'an as it has annulled contracts between Rehmania Fauji Sugar Mills Ltd. ; its shareholders ; its debenture-holders, the financial institutions and the foreign suppliers of Mills Machinery etc. With the result that the respondent and others have been deprived of their properties without their consent. Concluding, it was urged that Article 281(1) should be construed in a manner so as not to have validated Matial Law Regulation 103.

331. The appellant, in justification of the validity of the impugned legislative instrument (M. L. R. 103) has also referred to the Quranic verses to contend that by his conduct the respondent had deprived himself of the benefit of the contracts which are held as sacrosanct. Here I may point out that as a "faithful", if left to me, I would unhesitatingly and with all promptitude impose the Qur'anic law, and Sunnah of the Holy Prophet (peace be upon him). But the question is whether in the present state of law apart from the contending claims of the parties as to whether benefit can or cannot be taken of the Qur'anic verses on account of the disputed facts, legislative instrument can be struck down in exercise of the power of judicial review. I will now presently advert to it.

332. Clause (1) of Article 201 of the Interim Constitution of 1972 lays down that a High Court shall have such jurisdiction as is conferred on it by this Constitution or by law. Clause (2) enacts that subject to this Constitution, a High Court may, if it is satisfied that no other adequate remedy is provided by law on the application of any aggrieved party, make an order. Similarly in Article 199 of the 1973 Constitution, it is laid down that subject to the Constitution, a High Court may,...Or V the application of any aggrieved party, make an order. Accordingly, the power of judicial review is limited to what is conferred by the Constitution. Bearing this limitation in mind, the constitutional provisions occurrin a in the chapter relating to Principles of Policy need examination. Article V 29 of the Interim Constitution of 1972 lays down : "No law shall be repugnant to the teachings and requirements of Islam as set out in the Holy Qur'an and Sunnah and all existing laws shall be brought in conformity with the Holy Qur'an and Sunnah."

' The responsibility for giving effect to Article 29 is that of the Legislature by clause (11 of Article 27.

Again by clause (2) of Article 28, it is enacted that "The validity of an action or of a law shall not be called in question on the ground that it is not in accordance with the Principles of Policy, and no action shall lie against the State, any organ or authority of the State or any person on such ground".

This barring provision is a limitation on the power of judicial review to strike down any law which offends against Article 29 of the Constitution. The Courts being a creature of the Constitution itself cannot act above it so as to assum jurisdiction which is expressly taken away by the Constitution. It I 6 entirely the responsibility of the law-making agency to adhere to the Principles of Policy, and if they have not done so, the Courts canno step in to strike down the law. In the words of Hamoodur Rahman, C. J., in Zia-ur-Rehman's case: "It is not the function of the judiciary t legislate or to question the wisdom of the Legislature in making a particular law if it has made it competently without transgressing the limitations of the Constitution". Here I would again cite, at the risk of repetition, another passage from the opinion of the same learned Judge at page 76 of the Report "This does not, however, mean that the body having the power of framing a Constitution is "omnipotent" or that it can disregard the mandate given to it by the people for framing a Constitution or can frame a Constitution which does not fulfill the aspirations of the people or achieve their cherished objectives political, social or economic. These limitations on its power, however, are political limitations and not justiciable by the judiciary. If a Constituent Assembly or National Assembly so acts in disregard of the wishes of the people, it is the people who have the right to correct it. The judiciary cannot declare any provision of the Constitution to be invalid or repugnant on the ground that it goes beyond the mandate given to the Assembly concerned or that it does not fulfill the aspirations or objectives of the people. To endeavor to do so would amount to entering into the political arena which should be scrupulously avoided by the judiciary.

With political decision or decisions on questions of policy, the judiciary is not concerned. Its function is to enforce the Constitution and to see that the other organs of the State confine themselves within the limitations prescribed therein ; but in doing so it must remember that it too is subservient to the Constitution and its power to hear and determine is subject to the limitations contained therein and can be exercised only with regard to the subjects over which it is given jurisdiction and in the manner prescribed."

333. It is also not possible to give to Article 281(1) of the Interim Constitution, a constitutional provision and higher in status than ordinary law, a meaning different from what it conveys. It stands altogether on a different footing, and if there was any restraint on the Constitution-maker which they have disregarded then such a failure on their part cannot be corrected by the Court.

Concluding, therefore, the field of adjudication on this ground is not available while exercising the power of judicial review.

334. The learned counsel for the respondent strongly relied on Azad Government of the State of Jammu & Kashmir and another v. Kashmir Timber Corporation (1), but that judgment is not of any assistance as clause (5) of Article 31 of the Azad Jammu & Kashmir Interim Constitution Act, 1974 places a limitation on the legislative power to legislate any law repugnant "to the teachings and requirements of Islam as set out in the Holy Qur'an and Sunnah". The decision of the case, wherein the contracts were annulled by a legislation turned on this provision of the Constitution which does not exist as a limitation in or Constitution.

Presidential Order No, 22 of 1972

335. It was contended by the learned counsel for the respondent that the Order being a notification was not a Prsidential Order but issued in the exercise of power under para. (2) of the Martial Law Regulation No,

103. It was, therefore, not protected by Article 281(1) of the 1972 Constitution or Article 269 of the 1973 Constitution. The stand of the appellants was that although the Presidential Order No, 22 of 1972 was issued in pursuance of the Martial Law Regulation No, 103, yet it was a legislative instrument in its own right operating in a "separate field" and duly validated.

336. The High Court while construing the Order brushed aside the contention of the appellants that it was an independent legislative instrument, and held from a perusal of the opening part of the Order expressed as "in exercise of the power conferred by paragraph 2 of the

337. {{FOOTNOTE}}

(1) PLD 1979 SC (A J & K) 139 ' Martial Law Regulation 103, the President and the Chief Martial Law Administrator is pleased to make the following order to determine the terms and conditions of the transfer referred to in that paragraph ...", to be one issued in exercise of power conferred by para. 2 of the impugned legislative instrument and for this conclusion no argument was needed. In effect, it held that this Order did not stand to qualify as legislative instrument independent of the Regulation. This controversy is of prime importance and if it is held that the Presidential Order No, 22 of 1972 is a legislative instrument then it stands protected under Article 281 (1) irrespective of the defects or I infirmities.

337. It is clear from paras. 2 and 4 of the impugned legislative A instrument (M. L. R. 103) that the Chief Martial Law Administrator A appropriated to himself the power to determine the terms and conditions A of the transfer and the power to provide for the removal of difficulties A arising out of or in connection with the dissolution of the Company, or A ineffectively carrying out the purposes of this Regulation. In effect, A therefore, it was a reservation of legislative power unto himself and not a delegation of power for a law-giver cannot delegate to himself what he can do without it.

"Delegated power" in legal parlance means 'authority at which has been delegated or bestowed upon a person or body by a superior B or higher person or body' and "delegation of legislative power" means 'an B attempt by a Legislature to implicate its legislative power .By delegating to 8 another the power to enact a law, whether in form or effect, or to bestow upon another the power to determine the effectiveness of a specific act. (Ballantine's Law Dictionary Third Edition- at page 327). Such is not the case here and as the power was reserved it can only be taken in the sense of legislative determination and not judicial or quasi-judicial or administrative. Similarly the power to remove difficulties could only be by exertion of legislative power and not by an executive act.

Necessarily, therefore, the power to exercise this legislative determination emanated from the Proclamation of the Martial Law dated the 4th of April, 1969 and C the earlier Proclamation of Martial Law. It was to give effect to para. 2 c of the impugned legislative instrument (M. L. R. 103) that a complementary legislation such as the Presidential Order No, 22 of 1972 was issued in pursuance of the power conferred as stated above. Textually too, it could C not be branded otherwise than as a legislative instrument. The able of notification or reference to para. 2 of the impugned legislative instrument (M'. L. R. 103) in it would not alter its nature as it is the substance and not the form which matters.

338. The learned counsel for the respondent has taken serious objection to the determination of compensation without affording hearing to the respondent. This approach was so because the Order was treated as an act of a functionary acting judicially or quasi-judicially. It is settled law that no prior notice is necessary for making a legislation, and therefore, if there is legislative determination it also does not require the D compliance of the rules of natural justice. Here I would cite the authorities which support the above proposition : ' In British Railways Board and another v. Pickin (1), Lord Ried at page 617 of the Report, said : "In my judgment the law is correctly stated by Lord Campbell in Edinburgh and Dalkeith Railway Co. v. Wauchope. Mr. Wauchope (1) (1974) 1 All E l 6Q, claimed certain wayleaves. The matter was dealt with in a private Act. - He appears to have maintained in the Court of Session that the provisions of that Act should not be applied because it had been passed without his having had notice as required by standing orders. This contention was abandoned in this House. Lord Brougham and Lord Contenham said that want of notice was no ground for holding that the Act did not apply."

' In Bates v. Lord Hai!Sham (1), it was held at p. 1020 : "The committee's function under S. 56 was of a legislative and not an administrative, executive or quasi-judicial nature, and so it was not bound by rules of natural justice or by any general duty of fairness to consult all bodies that would be affected by the order it made under the powers delegated to it by section 56."

' Paul Jackson in his treatise "Natural Justice" at page 169, says : "There is no doubt that a Minister, or any other body, in making legislation, for example, by statutory instrument or bye-law, is not subject to rules of natural justice."

339. In de Smith's "Judicial Review of Administrative Action, Fourth Edition, at page 192, it is said : "Practical convenience may explain why the rule is thought not to apply to the making of regulations of a legislative character."

' The learned counsel for the respondent relied on Pir Shah Martian Shah v. Chief Land Commissioner (2), Chief Commissioner, Karachi v. Mrs. Dina Sohrab Katrak (3), Faridoons Ltd. v.

Government of Pakistan (4), Abdur Rehman v. Collector and Deputy Commissioner, Bahawalnagar (5), Abul A' la Maudoodi v. Government of West Pakistan (6), University of Dacca v. Zakir Ahmad (7) and Ridge v. Baldwin, (8) to support his proposition, but these cases are distinguishable as the orders were either of a judicial or a quasi-judicial or administrative nature, which, no doubt, attract the rules of natural justice. They cannot be regarded as an authority for the proposition qua a legislative instrument. As to the legal implication of the word "determination", 1 do not see any reason to go into this question as upon the finding I have given, it no longer remains a determinable issue.

340. As regards the submission that the Order was ultra vices as it provided for matters not covered by the parent legislation, it is also an E exercise in futility to go into it as the Order was not a subordinate/ delegated legislation, but a complimentary legislation having emanated from the same source as the impugned legislative instrument (M. L. R. 103).

341. The High Court has held that the impugned legislative instrument (Martial Law Regulation No, 103) was published in the Gazette extraordinary on 31st of December, 1971, and, accordingly, became operative as from that date ; whereas para. 2 of the Order recites 30th of December, 1971, as the date on which the Fauji Foundation became the. Sole owner of the Company. It was, accordingly, one day earlier to the date on which the impugned legislative instrument (M. L. R. 103) was {{FOOTNOTE}}

(1) (1972) 3 All E R 1019 (2) PLD 1974 Kar. 375

(3) PLD 1959 SC (Pak.) 45 (4) PLD 1961 SC 537

(5) PLD 1964 SC 461 (6) PLD 1964 SC 673

(7) PLD 1965 SC 90 (8) (1963) 2 All E R 66 ' promulgated, and, therefore, the determination of the terms and conditions at a time when the impugned legislative instrument (M. L. R. 103) was not in force, was premature, and for this reason the Order was bad. This conclusion is also erroneous as the Chief Martial Law Administrator issued the impugned legislative instrument (Martial Law Regulation 103) on the 29th of December, 1971 and expressed it to have come into force at once. This would be the date of its coming into operation.

Its operation did not depend upon its publication as the requirement in the Proclamation of 25th March, 1969 was only in regard to the publication of Martial Law Regulations and Martial Law Orders in such manner as was convenient without reference to their effective date of operation. In this connection reference may be made to Khalid M. Ishaq v. Chief Justice and the Judges of the High Court, West Pakistan, Lahore (1).

342. Here I may also add that the General Clauses Act does not apply in substance to the Martial Law Regulations and Orders. Section 5(1 of the General Clauses Act itself says that "where any Central act is no expressed to come into operation on a particular day, then it shall com into operation on the date on which it receives the assent." Assent in the case of this instrument was given on the date on which it was issued. Hence that date should be the case of its effective operation even on the basis.

343. Here also I may mention that the High Court also rejected the contention of the respondent that as the Order was dated 20th of April, 1972, and as the Martial Law was withdrawn instantly after the midnight of 19th April, 1972, the office of the Chief Martial Law Administrator stood vacated and hence he could not have issued the order. The High Court took note of the fact that the defect was rectified by a corrigendum published in the extraordinary Gazette of Pakistan dated the 21st of June, 1973, and the controversy raised on this issue in Mehreen Zabun Nisa v. Land Commissioner

(2) was settled as effect was given to this rectification.

344. Although it is not necessary to dispose of other objections levelled against the Order, but I have ventured to do so to remove any doubt as to the bona fides of the legislation. The High Court took/ exception to certain terms appearing in the Order, namely, "family of promoters" and "promotors" and so also "the contract of loan as being an independent transaction", which could not be made the subject-matter of the Order as it was not contemplated in the impugned legislative instrument (M. L. R. 103). Such aforementioned terms apparently appeared to the High Court to be unknown to the Companies Law, but I fail to see why an adverse inference should have been drawn. The term "the family of promoters" collectively indicates the interest in the shareholding out of the loan provided to the promoters. The promoters being the respondent and his mother, it was, therefore, that they were differently identified. And as to the loan being outside the impugned legislative instrument (M. L. R. 103), clause (4) of the said instrument takes care of it as it was designed to remove the difficulties in carrying out the purposes of this instrument. In using the terms the background was taken into consideration and as the impugned legislative instrument had an overriding effect, it was erroneous to refer to the Companies Law.

345. Another objection was taken that there was a discrimination in the Order between the two sets of shareholders, i,e, the respondent and his {{FOOTNOTE}}

(I) PLD 1966 SC 628 (2) PLD 1975 SC 397 ' family members, and the other shareholders, in that, that the compensation payable to the respondent and his family members was made adjustable against the loan received by them from the G. H. Q. Welfare Funds whereas the other shareholders received the compensation fixed in the Order without any deduction. This was so because the latter had not taken any loan from the G. H.

Q. Welfare Funds, and it was, therefore, that for a valid reason a distinction was made. Another objection was taken that in the impugned Order only a provision was made for the payment of loan due to the G. H. Q. And not for the payment of loan due to others. This was because the money payable to the G. H. Q. Was welfare money which stood on a separate footing. Nonetheless a provision was made in the present legislation for the discharge of liabilities of other persons or bodies.

346. Presidential Order No, 22 of 1972 being itself a legislative instrument likewise stands duly validated by Article 281(1) and is immune from any attack. The contention, accordingly, of the learned counsel foil the respondent is rejected.

347. By para. 2 of the impugned legislative instrument the Company stood dissolved and all its rights, properties, assets, debts, liabilities an obligations stood transferred immediately to the Fuji Foundation, and all that was left to be determined was the terms and conditions of such transfer.

The dissolution and the transfer of the Mill to the first appellant became effective on the date on which the impugned legislative instrument was issued, and as the dissolution and transfer was unconditional it became a past and closed transaction. In Asma Jilani's case all such past and closed transactions were condoned as it was held that no useful purpose would be served in reopening them. Similarly the other requirement of the? Second para. Of the impugned legislative instrument (M. L. R. 103), that is, the determination of the terms and conditions were also fulfilled by a subsequent legislation, namely, President al Order No, 22 of 1972. Thus the whole transaction covered by the impugned legislative instruments became a past and closed transaction on the eve of the promulgation of the Interim Constitution of 1972. These instruments stood repealed by Article 295 of the Interim Constitution of the Islamic Republic of Pakistan. Upon their repeal, consequences as mentioned in clauses (b) and (c) of Article 295 of the Interim Constitution of 1972, read as under took effect :- "(b) affect the previous operation of the law or anything duly done or anything duly done or suffered under the law ;

(c) affect any right, privilege, obligation or liberty acquired, accrued or incurred under the law ;"

The past and closed transactions have a constitutional protection. Accordingly, it is not open to the respondent to challenge the effect of the repeal. The High Court seems to have got over the repeal of these legislatively instruments by holding that as they were enacted mala fide they were void 7 and the first appellant acquired no right in the Mill from its inception. This assumption is wholly erroneous as no mala fides can be pleaded against a statute and for that reason it cannot be regarded as being void. Lastly, in regard to the plea of past and closed transaction, it was held that it was not sustainable on facts as action was being taken against the M respondent and his father on the strength of these legislative instruments, 7 and as they are void they amount to a continuing wrong which has given to them a continuing cause of action. This conclusion is erroneous as upon repeal the impugned legislative instruments could not be said to be is operation so as to provide a ground for taking action against the respondent and his father. The distinction here seems to be that this action was taken in pursuance to the consequences which had taken effect as mentioned in the said clauses (b) and (c). Accordingly, the effect of repeal cannot whittled by a fanciful conclusion on facts. It may also be stated here that there was no legal proceedings pending, therefore, they were not saved by the repeal.

348. I have endeavored to deal with all the substantial contentions raised by the learned counsel for the parties and as to those which have not been dealt with, nothing turns on them. My conclusion is that bot0 the Martial Law Regulation No, 103 and the Presidential Order No, 22217 of 1972 were validated not only in regard to their competency but also other defects, if any, by Article 281(1) of the Interim Constitution of 1972. Instruments existed on the date on which the petition was filed, but as the/ High this exercise was made despite the fact that none of the legislative High Court had on an assumed basis tested their validity on the touchstone of the 1962 Constitution, both as regards the supervening mada fides of the law-giver and the constitutional violation, that I have examined them and given my opinion.

349. In the end I wish to place on record my appreciation for the industry and ability shown by the counsel for the parties in arguing the case and providing the material to me for writing this judgment.

350. In the result, I would dispose of the certificated appeal and the one upon special leave in terms that the High Court's order dated the 9th April, 1980, passed in Constitution Petition No, 863 of 1973, is set aside and the writ issued is recalled. The appeals are, accordingly, allowed with only the costs of the certificated appeal.

ZAFFAR HUSSAIN MIRZA, J.-I generally agree with my Lord the Chief Justice and other points lucidly discussed by him and I say so with respect, except with regard to his observations regarding the concept of limitations on judicial power of scrutiny into the motives of the law-making authority as a ground for declaring the invalidity of law, on which I would refrain from expressing any opinion, because the question does not arise for decision in this case.

2. To further clarify, I fully concur with the reasoning and conclusion that Article 281 confers all- embracing validity on the impugned legislative measures in this case and, therefore, like all the Martial Law Regulations and Martial Law Orders, they "were valid as they were adopted as constituents of the National Legal Order irrespective of any constitutional or other defect."

' M. S. H. QURAISHL J.-I agree that the defects whatsoever in regard to the competency and validity of the impugned laws, viz. M. L. R. No, 103 and President's Order No, 22 of 1972, pointed out during the hearing of the appeal, stood cured by the validating provisions of Article 281(1) of the Interim Constitution of 1972 and Article 269(1) of the Constitution. Of 1973 and as such they are immune from being called in question in any Court on any ground including motive. I also agree that the objections raised to the manner of implementation of the said laws have no force and must be rejected. I, therefore, allow the appeal and set aside the impugned judgment of the High Court.

(1) P L p 1973 SC 49 PLD 1977 SC 657

(1) PLD 1982 SC 282

(1) PLD 1974 SC.151

(2) PLD 1958 SC (Pa

(1) PLD 1973 SC 49