' This order will dispose of following two bail petitions:--
(1) Criminal Miscellaneous No,195/B of 1995, Senator Lt.-General (Rtd.) Saeed Qadir v. The State
(2) Criminal Miscellaneous No,226/B of 1995 Riaz Shafi v. The State.
2. Brief facts of the case are that both the petitioners are accused of case F.I.R. No,3/95, dated 30-1- 1995 of Police Station F.IA., State Bank of Pakistan, Rawalpindi Circle under section 409/420/468/471/109, P.P.C. Read with section 5(2) of the Prevention of Corruption Act, 1947. In the year 1991 during the Government of former Prime 'Minister, Mian Nawaz Sharif, Federal Government undertook the process of privatization of the State Industrial Enterprises. In that process Pakistan P.V.C. Limited was also amongst the Industrial Enterprises to be privatized. Privatization Commission was set up of which Senator Lt.-General (Rtd.) Saeed Qadir the present petitioner was Chairman. Ground Rules for privatization of Industrial Enterprises were framed with the approval of Cabinet Committee on Privatization (C.C.O.P.). These Grounds Rules deal with the process to disinvest Public Sector Enterprises. The Rules are quoted below:-- "The Privatisation Commission has framed the following 'Ground Rules' to enable it to disinvest the public sector enterprises.
' These 'Rules' have the approval of the Cabinet Committee on Privatisation (C.C.O.P.).
' These Rules are framed whilst keeping the following parameters in mind.
(1) Current earning capacity.
(2) Future earning potential.
(3) Dividend paying capacity.
(4) Adjusted value of assets.
(5) Discounted cash flow.
(6) Replication costs.
' In view of the Government policy of rapid disinvestment programme tied to a laid down time schedule of less than one year, the only method of disinvestment that has been adopted is by 'cash sale' through public offering made as a result of advertisement.
' One hundred and fifteen (115) + 8 Rice Plants = 123 units have been selected for disinvestment. The list is placed at Annexure "A".
' The Commission initiates the process of valuation through independent consultants, assessors, surveyors and auditors.
' The valuation reports are reviewed, analysed and assessed independently by the 3 permanent members of the Commission.
' An agreed report is prepared by the Commission Secretariat to be placed before the 'Privatisation Commission' for discussion and their approval.
' The recommendations prepared by the Commission are placed before the Cabinet Committee on privatisation (C.C.O.P.) for approval.
' The Ministerial Committee considers the recommendations of the Commission, approves the conditions of the offer for sale and accords its final approval to advertise the project for sale alongwith the terms and conditions of the sale.
' The advertisement is placed by the Commission after obtaining the approval of the C.C.O.P.
' The bid documents authorise for sale through nominated outlets throughout the country.
' The offers are received by the Commission as per advertised instructions, upon these before the bidders and inform them of any conditional ties.
' The Commission evaluates the bids and formalises the proceedings to seek the approval of the C.C.O.P.
' The C.C.O.P. Approves or rejects the offers received.
' The Commission communicates the decision of the C.C.O.P. To the bidder/s."
' According to these Ground Rules the valuation of the Industry was to be assessed and prepared prior to calling for the bids.
3. Bids for sale of Pakistan P.V.C. Ltd. Were invited for 17-10-1991 before undertaking the process of valuation of the project as required by the Rules for privatisation of the industry. The valuation report of Messrs Zahid Zaheer Management Consultant is, dated 30-11-1991. Whereas date for bids was 17-10-1991. The valuation report was received by the Privatisation Commission on 2-12-1991 and approved reference price the basis of aforesaid report on 22-2-1992 after the letter of intent had already been issued to the buyer, on 29-12-1991. The C.C.O.P. Approved the reference price of (Rs,25 per share) on 21-3-1992 after letter of intent had already been issued and even the sale agreement, dated 23-1-1992 had been signed and the management also stood transferred on 8-2-1992.
4. According to the rules the previous owners have right to first refusal. According to the facts highest bid 25% per share was offered to Messrs First Schon Interfund Modarba. The bid of Messrs Reysheen (Pvt.) Karachi was Rs,670 per share, which was sent by Mr. Riaz Shafi, petitioner/accused.
These bids were received by Mr. Mosih-ud-Din. Then Secretary Privatization Commission. The documents placed on record show that Mr. Mosih-ud-Din on 10-12-1991 wrote thereon that the previous owners had not participated in the bidding, that the highest bid received was higher than the break-up value of the shares arrived at by the "Consultant and that after review the letter of intent would be issued to the highest bidder. As per allegation these observations were scored off and Mr. Riaz Shafi was allowed to match the highest bid, even though he had not been ascertained to be previous owner. On 17-10-1991, when the bids were opened. According to the terms and conditions joint audit had to be carried out at cut-off-date (date of taking over) for the purposes of valuation of current assets and liabilities on such date. In case of any variance in between the valuations made on 30-6-1991 and on 23-1-1992 in excess of 5% as per agreement, dated 23-1- 1992, the parties were entitled to adjustment and could claim accordingly from the other party. Mr. Riaz Shafi by having raised frivolous objections that cut-off-date should be 17-6-1992 and not 8-2- 1992, the cut-off-date was agreed to 14-6-1992 with the specific purpose of making undue benefits.
This shifting of date was purposefully got agreed upon by the Commission with a view to escape from the terms and conditions of the sale agreement, dated 23-1-1992 resulting further reduction in the net worth of the company, which the Government would have to reimburse to the buyer. In spite of all this the agreement already entered into on 22-10-1992 was approved by the Commission apparently with a view to have wrongful gain for the buyer/ petitioner and loss to the State.
5. There is another allegation that through a supplementary agreement, dated 22-2-1992, the Privatization Commission took 50%.Liability to pay for golden-hand-shake. The Privatization Commission issued cheque of Rs,16,386,875 on 25-10-1992 to Mr. Riaz Shafi to satisfy his contribution towards golden-hand-shake liability. Even in this regard no adjustment account was submitted by Riaz Shafi. The Commission issued another cheque of Rs,10,000,000 on 26-10-1992 in favour of Riaz Shafi as an advance to be utilized towards discharge of the share of the Golden- hand-shake liability, which was to be adjusted against accepted reduction in net worth of the company due to change in cut-off-date. No account of adjustment even for this advance was submitted by Mr. Riaz Shafi. On these allegations the above-mentioned case was registered against both the petitioners/accused.
6. In brief, the following are allegations against the petitioners/ accused:--
(i) No valuation assessm ent was carried out prior to calling for bids.
(ii) Mr. Riaz Shafi happened to bid on behalf of Messrs Rehsheen (Pvt.) Karachi and not as amongst previous owners of the Industrial unit.
(iii) Illegally and with mala fide and wrongful purpose Mr. Riaz Shafi was considered to be amongst previous owners ignoring name and address of the bidders quoted by him as Messrs Reysheen (Pvt.) Ltd. Karachi as the matter was settled for wrongful gain by the accused by causing wrongful loss to the State.
(iv) Not carrying out prior valuation assessment and keeping public at large ignorant of the actual value of the Industry and the estate land owned by P.V.C. Was a criminal act on the part of the accused to have undue gain by this process.
(v) P.V.C. Previous owners were not offered and they were denied their first right of refusal. The condition that offer was to be made only to those previous owners, who happened to take part in the bidding was not made applicable to Riaz Shafi in spite of the fact that he sent bid forms on behalf of Reysheen (Pvt.) Ltd. This fact does show that there was some underhand settlement agreed upon between the accused.
(vi) After acceptance of the bid a specific date of cut-off-date was fixed, but later on to take undue benefit, it was changed from 8-2-1992 to 17-6-1992. With a view to give shameful gain to Riaz Shafi by having entered a supplementary agreement of sale, the agreement of goldenhand-shake was entered into, the way it was approved, time it was agreed upon are circumstances which do speak much about the criminal way of doing by the accused.
(vii) Lastly, the allegation against the accused is that not only law and rules have been violated, but documents were prepared by adopting deceitful means for their personal gain and loss to the State.
7. The learned counsel for the petitioners/accused argued this case quite at length for number of days and sought bail on the following grounds:--
(a) That it is purely civil matter. The controversy is about the terms and conditions of the sale contract.
(b) All the actions were not only approved and ratified, but was given cover of requisite sanctity by the Cabinet Committee, under whose authority the Chairman of Commission was functioning.
(c) Failure to have valuation of assessment of the Industry prior to calling of bids, the learned counsel for the accused maintains that such method has also been adopted in number of other cases, the value was kept secret as nobody was coming forward to participate in the auction proceedings and offer bidding. To avoid that valuation assessment was not carried out and kept secret from the public-at-large. They further maintain that price of shares i,e, Rs,25 per share was not less in proportion to the net worth of the Industry assets. Keeping in view the market value it could not be more than that.
(d) They vehemently maintain that Mr. Riaz Shafi applied not on behalf 'of Reysheen (Pvt.) Ltd. But as amongst previous owners of P.V.C. Ltd., of which he was one of the Directors. They further attempted to clarify with intent to make a proposition in their favour that Messrs ' Reysheen (Pvt.) Ltd. Belong to the same family and none amongst the previous owners had come forward to raise any objection. They even offered to file affidavits on behalf of the previous owners showing that they had no objection about the bid offered by Riaz Shafi.
(e) According to the learned counsel the Ground Rules do not show that these were at any stage factually approved by the competent authority, hence no value can be attached to these Rules.
(f) They contend that the bid forms originally submitted leave no scope to say that the bid form was not submitted to the Privatisation Commission on behalf of Messrs Persons Specified in the Schedule of the Transfer of Managed Establishment Order, 1978 (P.O. No,12 of 1978) (Ex-Owners).
They are of the view that it is sufficient to give , right to Riaz Shafi alone to be buyer.
(g) Lastly they pray that both the petitioners are suffering from dangerous disease and for that matter their case falls under the exception clause of section 497, Cr.P.C. According to them, the nature of sickness is such that the petitioners are entitled to bail sole on this ground.
8. On the other hand, the learned Special Public Prosecutor for the State made the following propositions to be considered for rejection of the bail petitions.
(a) It was the duty of the Privatization Commission to initiate proceeding for assessment of the value of the property of the Industry and report could have been obtained from independent sources. According to him after receipt of the report it was to be looked into and assessed by at least three permanent members of the Commission and the matter was to be placed before the Cabinet Committee. The Cabinet Committee after considering the report and opinion of the permanent members of the Commission could accord the final approval. The Public Prosecutor maintains that mandatory requirements have been violated and simply saying that in some other cases prior valuation/assessm ent was not carried out, is not sufficient to absolve the petitioner/accused of the liability. He further maintains that value of the property would have been much more and bidding offer would have gone very high had prior assessment of the value been made open to the public-at-large as per requirement of law. He further emphasises that failure on the part of the accused not to have prior valuation/assessment tantamounts regulating the matter having criminal design to defraud the State and to make huge undue benefit out of affairs in conspiracy with the other accused.
(b) Special Public Prosecutor submits that the landed property of Pakistan P.V.C. Consisting of 46 Kanals locating within Industrial Area of Islamabad valued Rs,1,88,88,900 as per Book Value.
Whereas Zahid Zaheer, assessed this part of land as Rs,68,00,000 on 30-6-1991. He also pointed out that many Godowns and Offices Buildings of Pakistan P.V.C. Are located at Lahore and Karachi, which if properly assessed and valued would have given much rise in the bidding.
(c) The learned Public Prosecutor states that first offer was to be made to the previous owners i,e, Arokey Chemicals Industry, which had seven Directors and Riaz Shafi, petitioner, was one of the Director. He is of the view that no offer was made to other Directors and it was ignored at the instance of the Chairman, petitioner/accused for his personal ends.
(d) He contends that Riaz Shafi in fact offered bidding on behalf of Messrs Heysheen (Pvt.) Ltd. To prove it that he acted in that capacity and not as previous owner. Financial Certificate showing financial position Messrs Reysheen (Pvt) Ltd. Enclosed with the bid forms is sufficient piece of evidence. This certificate shows financial soundness of Messrs Reysheen (Pvt.) Ltd. And not personal financial position of Riaz Shafi. Riaz Shafi may be Chief Executive of the company, but fact remains that the bid form was on behalf of Reysheen (Pvt.) Ltd. In this regard he also referred to the record-sheet, wherein the name and address of the petitioner is mentioned as Messrs Reysheen (Pvt.) Ltd. Karachi, which document bears the signature of Riaz Shafi leaving no scope, according to him, to believe that the bid was on behalf of the previous owner. The learned State Counsel explaining it further submits that this change and shifting capacity of Riaz Shafi as to whether it was on behalf of Pakistan P.V.C. Previous owners or on behalf of Messrs Reysheen (Pvt.) Ltd. Or in his personal capacity are the designed tactics adopted and engineered by the petitioners/ accused as criminal gain was got settled between them after submission of these documents at different stages.
(e) Bids were received on 17-10-1991 and the value report prepared by Zahid Zahir on 30-11-1991 what else could be gathered from this putting horse behind the cart, but to have dishonest.
(f) On 23-1-1992, deed of original sale was executed.
' On this very dated at 9-00 a.m. Mushtaq Elahi, General Secretary of P.V.C. Labour Union happened to submit application to the Privatization Commission, whereon time had also been written. The contents of the application are that all the employees of P.V.C. (500 in numbers) are prepared to have golden-shake-hand. Date and time factor do compel to believe that it was initiated when sale agreement was written and executed, conditions regarding golden-shake-hand were not written therein, on 22-10-1992, supplementary sale agreement was prepared and 50% liability of golden-shake-hand was taken up and mentioned by the Privatization Commission leading to change in cut-off-date from 18-2-1992 to 17-6-1992. It was mischievous act to pocket illegal gain.
(g) On 8-2-1992 original cut-off-date as per Ground Rules audit was to be carried out. Had Audit report been prepared, the value of the assets would have been much higher than shown after change in cut-of-date to 17-6-1992. The accede did not restrain from ill-doings even on the objection raised and recorded by Mr. Masih-ud-Din, Secretary Privatization Commission to the effect that cut-off-date could not be changed. The learned counsel further agitates that to cover this illegality with regard to objection raised by the Secretary, the matter was referred to Legal Adviser, Sheikh Muhammad Akram, Advocate. Even his opinion shows that the cut-off-date could not be changed. The Chairman of the Commission, petitioner/accused in spite of objection raised by Secretary and legal opinion of the Legal Advisor proceeded in the matter to commit a patent illegality and disagreed with the above opinion. According to the learned counsel this too was mala fide on the part of petitioners/accused to have undue benefits.
(h) The change in cut-off-date was incorporated in supplementary agreement executed on 22-10- 1992 with a View to take up liability of golden-shake-hand to the extent of 50%. In addition, the Chairman Privatization Commission decided to make payment of Rs,63,86,875 to Riaz Shafi alongwith P.V.C. Industry on the ground that this amount was to be paid to the Labourers. Thus, huge burden was put on the shoulder of State simply by making change in cut-off-date with a view to give undue benefit to Riaz Shafi by Chairman in the manner which could not be fair and honest in the given circumstances.
(i) Rs,1,00,00,000 was also given to Riaz Shafi by Chairman to facilitate him' to discharge the liability of golden-shake-hand to the extent of 50% which amount was given without any security in spite of the fact strict directions were given by C.C.O.P. This payment could have been made only by Chairman with prior approval of the Prime Minister because it exceeded 20% of the total sale price of the unit. Even this condition was not looked into. No undertaking was obtained from Riaz Shafi in the matter. Payment of 26% was taken away improperly and utilized by the accused in criminal manner.
(j) Lastly, the learned counsel for the State while opposing bail petitions makes submission that crores of rupees have been embezzled and the State property infact been given for pennies. He states that it is a crime, which can be called "White Collar Crime" committed by persons having entrustment and dominion over the industries for privatizing. According to him it is most unfair, immoral and unpatriotic that such like highly placed persons, while managing the State affairs indulge in criminal activities and treat the State property as if they had no scruple to the just in the State affairs and well being of the people of Pakistan.
9. On this juncture, he has also stated that investigation has since been completed and challan shall be submitted for trial within 2/3 days.
10. Regarding ground of sickness for bail, the learned Public Prosecutor submits that both the petitioners are not confined in Adiyala Jail. They are admitted in the Hospital of their own choice and being medically treated with all the best possible medical facilities, under the direction of this Court. "They cannot take benefit of this ground when they have made choice to be treated in such Hospital by the Doctors whom they nominated. The learned counsel appearing for the State also criticised the very version regarding health of the petitioners. He maintains that they fell ill only when they apprehended involvement/arrest in the criminal case.
11. After the arguments advanced by the learned counsel for the State, the counsel for the petitioners/accused again were provided opportunity to rebut new points raised by the learned Public Prosecutor. In nutshell they stated that the value of the Industry has been wrongly mentioned by the State counsel. They even repeated the arguments with regard to documents referred above. At the conclusion of arguments they led much stress on the ground of sickness for seeking bail for the petitioners.
12. I have heard the learned counsel for the parties and perused the record. It is an admitted fact that prior valuation of P.V.C. Including its property was not carried out as per requirement of law.
The excuse that it has been done so in so many other cases does not absolve the petitioners/accused to deal with the State property trust given by the people of Pakistan in such like whimsical manner by defying the dictates of law. Riaz Shafi changed many positions at different stages to be a buyer and that could not have been without prior collusion between the accused, According to the bid-sheet Messrs Persons Specified in the Schedule of the Transfer of Managed Establishments Order, 1978 (P.O. No,12 of 1978 Ex-owners), offered bid, but later on Riaz Shafi claimed to be sole bidder denying the rights of offer to the remaining sharer. Other sharers may be close relative of Riaz Shafi but the thing have not been done in the manner law requires to have been done. So far as record sheet of the bids is concerned, which bears signatures of Riaz Shafi, do show the name and address of the petitioner/accused, Riaz Shafi. Wherein, it was clearly written that bid was filed by Messrs Reysheen (Pvt.) Ltd. And not previous owners of Pakistan P.V.C.
In this case previous owners have been totally ignored and even some of them have died, but their legal heirs were not offered to participate in the transaction affairs. Correspondence and letters exchanged between Riaz Shafi and the Privatization Commission were written and conveyed on the address of Messrs Reysheen (Pvt.) Ltd., but in spite of that the learned counsel for the petitioner/accused attempted to show that Riaz Shafi acted not on behalf of Messrs Raysheen (Pvt.) Ltd. A letter is on the record, though without date, addressed to the Privatization Commission, Islamabad, do speak of "bank letter", which is referred by the State counsel, showing financial position of Messrs Reysheen (Pvt.) Ltd. And not that of Riaz Shafi. Criminal mind schemed out and Riaz Shaft's position was changed. This part of collusion do make out prima facie case punishable with 10 years' R.I. Or more. The certificate was annexed with the bid documents on which matter proceeded further. It will not be proper for me to go in detail so minutely that it may affect and prejudice the case of either side. I am, however, of the view that both the accused/petitioners are connected with the alleged crime with sufficient evidence.
13. So far as medical ground for bail is concerned, it is worth to mention that on the application of the petitioners they were sent to the Hospital of their choice for medical treatment. They are being medically treated by the Doctors, whom they desired. Both the petitioners/accused are admitted in the Hospital where best available medical facilities are being provided to both the petitioners at the Government expenses.
14. The Court viewed that the State property has been transferred for petty amount as compared to its actual value to Riaz Shafi petitioner/accused under the garb of Privatization policy of the Federal Government. Higher placed persons in the State management including the petitioners/accused committed violation of the rules and law in such a manner, tentatively, at this stage no other conclusion can be drawn that with the criminal design undue gains have been made by the accused by causing huge undue loss to the State. It is alarming that millions of people of Pakistan who look forward towards such like highly placed persons to be beneficiaries for Governmental affairs but by indulging in such like nefarious activities, the so-called white collar/responsible persons are found with unclean hands. Pakistani nation and State are unfortunate where crimes of embezzlement cheating, forgery and criminal breach of trust are so commonly committed by those who are brought in to powers with lot many efforts by the people themselves, having very high expectations. The economy of this country is under hard hit because of such like activities which have not been checked previously. It may not have painful disastrous effect. I am conscious of the fact that law abiding citizens should not be pushed to wall, compelling them to exhibit their hatred for the State, but those who pose themselves to be leaders and trustees of the State resources should not have respectable place and status when they indulge in committing the crimes to deprive not only the individual but the nation at large of their hard earned sources.
15. Before parting with the case hereunder is the summary to show that the quantum of amount allegedly embezzled by foul play:-- (a)Messrs Pakistan P.V.C. Ltd. sold by the Privatization Commission under the Chairmanship of the petitioner/accused to the co-accused Riaz Shafi forRs.63.57 Millions.
(b)The amount reduced causing devalue of the assets on account of extended cut of dateRs.19.00 Millions (c)Under Golden Hand Shake Scheme liability accepted for the State illegally and criminally amounting toRs.16.3 Millions (d)Messrs Pakistan P.V.C. Ltd. in real terms sold/transferred for a sum ofRs.28.00 Millions (e)At the time of sale Riaz Shafi petitioner/accused paid 40% of the bid value and the remaining 60% was to be paid in three yearly instalments. Thus, the amount paid by Riaz Shafi i.e. 40% comes toRs.25.43 Millions (f)Riaz Shaft was paid in the shape of loan amounting to Rs.10.00Millions.
(g)The total net result form the above details it is clear that the Privatization Commission transferred all the assets of Pakistan P.V.C. Ltd. to Riaz Shaft and received only Rs.25.43 Millions, while giving him certain concession enabling him to gainRs.16.3 Millions.
16. Thus, the Privatization Commission transferred the industry to Riaz Shafi, without receiving any amount from him as price. Instead gave him Rs,10.00 Millions from the Government exchequer. This sale transaction in its outward shape compels the Court to say at this stage tentatively that the industry was transferred without making a penny's payment to the State. Riaz Shafi received by way of loan etc. Rs,26.3 Millions from the Government and paid 40% price that is Rs,25.43 Millions.
Hence the accused actuated looting. They took over the industry and also Rs,10.00 Millions additionally.
17. In view of the above, I have no hesitation to say that the petitioners have no case for bail. Both the bail petitions are dismissed. Observations recorded above, shall not affect merit of the case.