The charge against the accused is that they on or about 29-7-1987, 22-10-1987 and 11-11-1987, as Directors of Messrs Patley International. (Pvt.) Ltd., Karachi, failed to produce the required statements and documents in relation to the business carried out by the said company for the purpose of determining whether the said company was: doing any banking business in contravention of section 27(1) of the Banking Companies Ordinance, 1962, and thereby committed an offence punishable under section 43-A, read with, section 83(1-C) of the Banking Companies Ordinance, 1962.
2. Messrs Patley International (Pvt.) Ltd., Karachi is a private registered company, with accused Muhammad Pervaiz Anwar Qureshi and Khawaja Akhtar Elahi as its Directors. The State Bank of Pakistan in exercise of its powers vested in it under section 43-A of the Banking Companies Ordinance, 1962, issued a directive, dated 29-7-1987 to the aforesaid company calling upon it to produce the required statements and documents in relation to the business carried out by the said company for the purpose of determining whether the said company was doing illegal banking business. The accused No. 1 sought one week's time on the ground that its Chief Executive/Managing Director was out of Karachi. After a few visits to the office of accused No.1 and examination of some documents by the Inspection Team of the State Bank of Pakistan it was found necessary to examine some more records which were not produced. Hence vide another directive, dated 22-11-1987, the State Bank of Pakistan called upon accused No.1 to produce/furnish some specified documents/information for the purpose of inspection by 24-10-1987, but the said company failed to produce these documents. In order to give one more chance a directive, dated 11-11-1987 was published in Daily Dawn Karachi calling upon accused No.1 to produce within seven days all the books and records concerning its business for inspection by the State Bank of Pakistan, but with no result. The accused thus contravened the provisions of section 43-A of the aforesaid Ordinance, punishable under section 83(1-C) of this Ordinance. Consequently on 27-1-1988 a complaint against the accused was filed before this Court, which was brought on record on 7-2- 1988.
3. Charge under section 43-A, read with section 83(1-C) of the Banking Companies Ordinance, 1962, was framed against accused Muhammad Pervaiz Anwar Qureshi and Khawaja Akhtar Elahi and they were asked as to whether they plead guilty or have any defence to make, to which they pleaded not guilty and claimed a trial. At the trial the prosecution examined Mian Abdul Qadir, Senior Deputy Director (P.W.1), Mohiuddin Khan, Inspector (P.W.2) and S. Ali Hassan Rizvi, Inspecting Officer (P.W.3).
4. In his statement recorded under section 342, Cr.P.C., accused Muhammad Pervaiz Anwar Qureshi has admitted that he was working as Managing Director of accused No.1 and had received investments from public in terms of Memorandum and Articles of Association. He has further admitted the receipt of directives from State Bank of Pakistan, but calimed to have replied the same. He has examined himself on oath (D.W.1) but led no defence. Accused Khawaja Akhtar Elahi while disputing the allegations in his statement recorded under section 342, Cr.P.C., pleaded that he had tendered resignation on 25-7-1987. His defence in his own words is as follows:-- "Messrs Patley International (Pvt.) Ltd. Was floated on 6-5-1987. On 9-5-1987 it was resolved that Mr. Muhammad Pervaiz Anwar Qureshi be appointed as Managing Director of said firm (company) with full responsibilities of business and financial matters. Due to my illness and serious differences with Managing Director and Chief Executive, I did not attend office of the firm (company). Due to unlawful activities of Pervaiz, I gave him a legal notice. I warned Muhammad Pervaiz Anwar to stop the unlawful business. I told him that he was responsible for all penal actions and ensuing consequences. I asked him to wind up the company and gave him such notice. He declined to wind up and asked me to resign. I then resigned. Such resolution is with me. I produce certain documents as (Exh.5/1 to Exh.5/10)."
Accused Khawaja Akhtar Elahi also examined himself on oath, (D.W.2). He, however, led no defence.
The points for my determination are as follows:--
(i) Whether accused Muhammad Pervaiz Anwar Qureshi and Khawaja Akhtar Elahi, were the Directors of accused No.1.?
(ii) Whether accused Muhammad Pervaiz Anwar Qureshi and Khawaja Akhtar Elahi, being the Directors of accused No.1 failed to produce/supply relevant record/information when called upon to do so by the State Bank of Pakistan?
(iii) What offence, if any, is committed by the accused or any one of them?
6. My findings on the above points are as follows:--
(i) As under.
(ii) As under.
(iii) Accused Muhammad Pervaiz Anwar Qureshi is guilty for the offence under section 83(1-C) of the Banking Companies Ordinance, 1962, while the case against accused Khawaja-Akhtar Elahi is not proved.
REASONS Points Nos. 1. 2 and 3.
7. Since the evidence on all these points is common, they are being disposed of together.
8. Mian Abdul Qadir, Senior Deputy Director (P.W.1) has testified the facts leading to the prosecution of accused. He has produced the Memorandum and Articles of Association (Exh.l/B) to show that both Muhammad Pervaiz Anwar Qureshi and Khawaja Akhtar Elahi were the directors of accused No.1. The copy of Form 29/A (Exh.1/D) is also on record which confirms this position. The newspaper (Exh.l/5), dated 25-7-1987 is also on record indicating therein that the State Bank of Pakistan had reason to believe that accused No.1 was indulging in illegal banking business. The receipt of directives is also not in dispute. Accused Muhammad Pervaiz Anwar Qureshi has admitted the receipt of the above directives, while accused Khawaja Akhtar Elahi has pleaded that he had severed his relations with accused No.1, when the directives were served upon it. Accused Muhammad Pervaiz Anwar. Qureshi claimed to have replied the directives, but except a telegraphic request (Exh.1/G) seeking time for the compliance of directive there is nothing on record to prove it. The detailed statement made by accused Muhammad Pervaiz Anwar Qureshi on oath (D.W.1) also does not show that necessary compliance was made. The cross-examination made to this accused on behalf of complainant is self-explanatory and for the sake of convenience is reproduced below:-- "I had received notices from State Bank of Pakistan and I had replied the same. I do not remember if I had not produced the record asked for by the State Bank of Pakistan as it was not ready at that time. I had accepted investment from public. I had received about 4 or 5 crores of rupees."
9. Accused Muhammad P.Ervaiz Anwar Qureshi has virtually admitted the entire case of the prosecution and it is proved beyond any shadow of doubt that he had contravened the provisions of section 43-A of the Banking Companies Ordinance, 1962.
10. I now proceed to examine the case of the prosecution against accused Khawaja Akhtar Elahi.
The evidence of, Mian Abdul Qadir, Senior Deputy Director (P.W.1) makes it clear that State Bank of Pakistan came to know for the first time on 25-7-1987 that accused No.1., was indulging in illegal banking business and consequently the first directive (Exh.1/F) was issued to accused No.1 on 29-7- 1987. Accused Khawaja Akhtar Elahi (D.W.1) as his own witness has testified that he had tendered resignation on 25-7-1987 which was accepted by a resolution passed on the same day vide (Exh.9). He has also placed on record legal notices sent to accused Muhammad Pervaiz Anwar Qureshi (Exhs.l3 and 14) which make it clear that the company was indulging in illegal activities which prompted accused Khawaja Akhtar Elahi to severe his relations. The only fact that this resignation was sent to Joint Registrar by accused Muhammad Pervaiz Anwar Qureshi at a late stage hardly makes any difference when the resolution (Exh.9) is admitted by all concerned. The Form 29 which is on record (Exh.7) is self-explanatory. It is thus proved from the record that accused Khawaja Akhtar Elahi was not the Director of accused No.1 at the time when it appeared to State Bank of Pakistan that accused No. I was- indulging in illegal banking business and consequently directives were issued to it. Accused Khawaja Akhtar Elahi has, therefore, not contravened the provisions of section 43-A of the Banking Companies Ordinance, 1962, and he is acquitted accordingly. Accused Khawaja Akhtar Elahi who is on bail if, discharged from his bail bond.
11. For the reasons mentioned above charge under section 43-A, read with section 83(1-C) of the Banking Companies Ordinance, 1962, is proved against accused Muhammad Pervaiz Anwar Qureshi beyond any reasonable doubt. Accordingly he is convicted for the said offence. The question of sentence has engaged my anxious consideration. Accused Muhammad Pervaiz Anwar Qureshi is in custody since 17-1-1990 and has almost completed a period of about two years in detention. Taking all the circumstances into consideration, I sentence him to imprisonment already undergone by him as under trial prisoner. The accused is also sentenced to pay an aggregate fine of Rs.1,00,000 (Rupees One lac) or in default to suffer S.I. For three months.