' RAJA ABDUL AZIZ BHATTI, J.--- Learned counsel for the petitioner seeks bail for Ch. Shujat Hussain, petitioner, in case F.I.R. No,11/1994 registered at Police Station F.I.A./S.I.U., Islamabad on the report lodged by Mr. Matiur Rehman, Managing Director of Investment Corporation of Pakistan, Karachi.
The case has been registered under section 420/468/471/ 477-A/109, P.P.C. Read with section 5(2)47, P.CA. All these offences are scheduled offences, hence, non-bailable.
2. According to the contents of the F.I.R., a complaint vide letter No,MD(PA)Law/1162/94, dated 10th November, 1994, addressed to the Director-General, F.IA., Islamabad, was received from Matiur Rahman, Managing Director, Investmeit Corporation of Pakistan, Karachi, for registration of a criminal case against the Directors of Messrs Phalia Sugar Mills Limited and others. The complainant stated in the F.I.R. That the Directors of Phalia Sugar Mills having its registered office at 20-E/I-G, Gulberg-H, Lahore (hereinafter called the accused) applied for a loan of Rs,300 million to I.C.P.
3. The accused in their earlier application, dated 23-2-1991 stated that the loan of Rs,249 million was needed for expansion of the existing sugarcane crushing capacity of their sugar mills. Then vide application, dated 25-8-1991 the accused stated that the loan of Rs,300 million was needed to pay off its .Outstanding liabilities of N.I.C.F.C.
4. The request came out to be fraudulent in substance, in view of the fact that Messrs Phalia Sugar Mills had already paid off Rs,200 million to Messrs N.I.C.F.C. On 2-9-1991 as is obvious from the reconveyance deed (certified copy enclosed) executed by N.I.C.F.C. In favour of Messrs Phalia Sugar Mills Limited. The contents of the reconveyance deed are that Phalia Sugar Mills Limited having repaid the entire Debenture loan of Rs,200 million to the N.I.C.F.C. The receipt of which is acknowledged, the mortgagor hereby redeems/releases to Messrs Phalia Sugar Mills Limited, the Mortgagor Company, all the properties and assets detailed in the Mortgage Deed, dated 6-7-1989.
It was a registered deed which was executed with fraudulent motives by prevailing upon I.C.P. For a loan of Rs,300 million which had to be sanctioned and remitted by I.C.P. To N.I.C.F.C. Messrs Phalia Sugar Mills also executed a L.M.M. Financing Agreement with I.C.P. On 5-9-1991 with a false undertaking that Rs,195 million shall be utilized by the company for repayment of loans of Rs,300 million to Company N.I.C.F.C. Which were obtained by the Company for setting up a Sugar Mills of 3000 T.C.D. At Phalia, District Gujrat. The case of the petitioner is that prior to 2-9-1991, N.I.C.F.C. Loan was paid off by making payment of Rs,200 million.
5. The accused also received an amount of Rs,105 million as loan fraudulently by creating a "Fleating Charge" against all the present and future assets of the company in favour of I.C.P. Led consortium vide their registered deed dated 7-9-1991. The N.I.C.F.C. Allegedly received Rs,300 million knowing fully well that payment of Rs,200 million had already been made by Messrs Phalia Sugar Mills Limited and earlier acknowledged by it through the registered reconveyance deed dated 2-9- 1991. The Director of Messrs Phalia Sugar Mills Limited namely, Ch. Shujaat Hussain, Ch. Pervaiz Elahi, Ch. Manzoor Elahi, Ch. Gulzar Muhammad, Ch. Wajahat Hussain and others in collusion with and in connivance of the concerned officials of N.I.C.F.C. And by exerting undue pressure on concerned officials of I.C.P. Cheated and defrauded I.C.P. Of the amount of Rs,300 million.
6. On the basis of aforesaid facts and circumstances, it was requested that a criminal case be registered against all the accused persons for necessary legal action. Accordingly, on receipt of this complaint, the F.I.R. Was recorded and the investigation is in progress.
7. The petitioner was arrested on 8-12-1994. Hence this petition.
8. Learned counsel for the petitioner seeks bail on the following grounds:--
(a) that no recovery has been effected from the petitioner;
(b) that no recovery is to be effected from the petitioner as he is presently confined in judicial lock- up;
(c) that all the penal sections mentioned in the F.I.R. Are not applicable and no offence can be made out besides sections 471 and 477-A, P.P.C. Which are bailable;
(d) that section 568, P.P.C. And section 5(2)47, P.C.A. Do not fall under the prohibitory clause of section 497, Cr.P.C. As the offences are not punishable with 10 years or more;
(e) according to the learned counsel for the petitioner, it is a case of civil nature involving creation of loan granted by I.C.P. And N.I.C.F.C. For the installation and expansion of Phalia Sugar Mills Limited. He maintains that no fraud or cheating has been committed. All the concerned companies, firms and departments are the consenting parties;
(f) he argues that bail after arrest is being sought. In such like cases the criteria is to grant bail and refusal can be ordered only in exceptional cases. He is of the view that it is a case of no evidence.
The petitioner has been involved to restrain him from criticising the policies of the present Government.
9. On the other hand, learned Deputy Attorney-General contends that a huge amount has been obtained from I.C.P. At a concessional rate of interest for the purposes to be utilized to clear off the outstanding loan of Messrs N.I.C.F.C. Which was not within the competency of I.C.P. People to grant and permit. I.C.P. Could make payment of loan only for certain projects but not to clear the outstanding loan of anyone as has happened in the present case. He maintains that I.C.P. Officials were won over and deceitfully influenced and thus the sanction of financial assistance of L.M.M.
Was got revised to Rs,195 million and further financing to Rs,105 million for the purposes to be utilized to repay the outstanding loan of Messrs N.I.C.F.C. He argued that L.M.M. Assistance of Rs,195 million is payable to at mark up of 8 per cent. Per annum. The outcome is undue gain of 10 per cent.
Per annum when originally application was submitted for sanction of Rs,300 million loan for the establishment of Messrs Phalia Sugar Mills Ltd. But after some time the accused party submitted application to N.I.C.F.C. For loan with a view to install Sugar Mills. Later on, when they had the Governmental influence, they again applied to I.C.P. For the grant of loan for the expansion of the Mills for which the rate of interest is muchless than the loan originally sanctioned for the purpose of installation of new Mills. The petitioner and his co-accused mechanized a further scheme to reapply I.C.P. To grant sanction to make payment of outstanding loan of N.I.C.P.C. Which they succeeded but criminally as it was beyond the authority of I.C.P. The investigation so far carried into these affairs unveils the tdifice of legal mechanizm based on cheating, dishonesty and fraudulent measure with a criminal design to achieve ill-motivated objects of loundering money for their wrongful gain.
10. Learned Deputy Attorney-General has referred to certain oral and documentary evidence so far collected by the Investigating Agency in support of the allegation, which prima facie, do make out a case regarding which it can safely be said that reasonable grounds do exist that the petitioner and his co-accused are involved in the commission of crime falling within the prohibitory clause in the matter of bail,
11. While summing up his arguments stated that section 5-A, subsections (6) and (8) disentitled the petitioner to grant of bail. He maintains that granting bail to the petitioner, at this stage, would be a cause of providing opportunity to him to interfere illegally with the process of investigation. He, therefore, prays that the bail application be dismissed.
12. v We have heard the learned counsel for the parties and gone through the record. There is some force in the contentions raised` by the learned Law Officer that the accused have committed the offences as mentioned in the F.I.R., especially, keeping in view the following circumstances:- ' Firstly, Messrs Phalia Sugar Mills Limited applied for the grant of 300 million as loan to establish new Sugar Mills. It was sanctioned at the rate of 16% interest per annum, though at that stage the amount was not released; ' Secondly, they applied to N.I.C.F.C. And allegedly obtained a loan of Rs,300 million for the establishment of same Mills at Phalia at the rate of 18% interest per annum; ' Thirdly, they again applied to I.C.P. For the sanction of loan on the basis of the earlier application for the expansion of the Mills at the rate of 8% instead of 16% per annum; ' Fourthly, on or after 5-9-1991 Phalia Sugar Mills Limited received two categories of loan, viz.
(a) Financial Assistance of L.M.M. Amounting to Rs,195 Million;
(b) Further financing amounting to Rs,105 million; ' Both these loans were obtained from I.C.P. To pay off the outstanding loan to N.I.C.F.C. In this case, they obtained this amount at the rate of 8% per annum whereas they were required to pay interest at the rate of 18% per annum on the loan which they had from N.I.C.F.C.; ' Fifthly, there is a deed of re-conveyance on the record which shows that Messrs Phalia Sugar Mills Limited made admission that on or before 2-9-1991 the total amount of loan obtained from N.I.C.F.C. Was paid off by making payment of Rs,200 million.
It may be pointed out that Messrs Phalia Sugar Mills Limited have taken conflicting stands to the effect that on 2-9-1991 they cleared off the total outstanding loan of N.I.C.F.C. But in spite of that they obtained Rs,195 million and Rs,105 million from I.C.P. To make payment of outstanding loan on 5-9-1991. In view of the above, we hold that the prosecution has a prima facie case against the accused to proceed further.
13. We are conscious of the fact that at this stage, expressing opinion regarding each and every contention of the learned counsel might prejudice the case of either party. We do not, therefore, like to dilate any more in the matter. Accordingly, the bail petition is dismissed. The petitioner may, however, apply for bail afresh after the completion of investigation. The Investigating Agency is directed to complete the investigation of the case within fifteen days. This order shall be treated as non-existent for the purpose of trial of the case.