This single order shall dispose of the following writ petitions as they call in question the validity of the impugned Circular No,23, dated 2-7-1998 issued by the State Bank of Pakistan:-
(1) W.P. No,14364 of:1998 (2) W.P. No,14759 of 1998
(3) W.P. No,14797 of 1998 (4) W.P. No,14854 of 1998
(5) W.P. No,14864 of 1998 (6) W.P. No,14865 of 1998
(7) W.P. No,14866 of 1998 (8) W.P. No,14867 of 1998
(9) W.P. No,14869 of 1998 (10) W.P. No,14878 of 1998
(11) W.P. No,14975 of 1998 (12) W.P. No,14977 of 1998
(13) W.P. No,15058 of 1998 (14) W.P. No,15065 of 1998
(15) W.P. No,15071 of 1998 (16) W.P. No,15072 of 1998
(17) W.P. No,15073 of 1998 (18) W.P. No,15074 of 1998
(19) W.P. No,15076 of 1998 (20) W.P. No,15082 of 1998
(21) W.P. No,15085 of 1998 (22) W.P. No,15091 of 1998
(23) W.P. No,15094 of 1998 (24) W.P. No,15105 of 1998
(25) W.P. No,15109 of 1998 (26) W.P. No,15114 of 1998
(27) W.P. No,15115 of 1998 (28) W.P. No,15116 of 1998
(29) W.P. No,15117 of 1998 (30) W.P. No,15118 of 1998
(31) W.P. No,15131 of 1998 (32) W.P. No,15132 of 1998
(33) W.P. No,15133 of 1998 (34) W.P. No,15134 of 1998
(35) W.P. No,15135 of 1998 (36) W.P. No,15148 of 1998
(37) W.P. No,15161 of 1998 (38) W.P. No,15185 of 1998
(39) W.P. No,15204 of 1998 (40) W.P. No,15220 of 1998
(41) W.P. No,15237 of 1998 (42) W.P. No,15240 of 1998
(43) W.P. No,15266 of 1998 (44) W.P. No,15289 of 1998
(45) W.P. No,15300 of 1998 (46) W.P. No,15306 of 1998
(47) W.P. No,15307 of 1998 (48) W.P. No,15308 of 1998
(49) W.P. No,15337 of 1998 (50) W.P. No,15341 of 1998
(51) W.P. No,15343 of 1998 (52) W.P. No,15345 of 1998
(53) W.P. No,15347 of 1998 (54) W.P. No,15348 of 1998
(55) W.P. No,15349 of 1998 (56)W.P. No,15350 of 1998 (57 W.P. No,15351 of 1998 (58) W.P. No,15371 of 1998
(59) W.P. No,15372 of 1998 (60) W.P. No,15373 of 1998
(61) W.P. No,15395 of 1998 (62) W.P. No,15401 of 1998
(63) W.P. No,15416 of 1998 (64) W.P. No,15443 of 1998
(65) W.P. No,15444 of 1998 (66) W.P. No,15446 of 1998
(67) W.P. No,15448 of 1998 (68) W.P. No,15459 of 1998 (69 W.P. No,15460 of 1998 (70) W.P. No,15462 of 1998
(71) W.P. No,14976 of 1998 (72) W.P. No,14978 of 1998
(73) W.P. No,15463 of 1998 (74) W.P. No,15538 of 1998
(75) W.P. No,15064 of 1998(76) W.P. No,15346 of 1998
2. The respondent-State Bank of Pakistan filed its report and parawise comments in Writ Petition No,14538 of 1998. The learned Deputy Attorney-General for Pakistan stated at the Bar that the same be also considered for the purposes of all other connected writ petitions.
3. The petitioners are the holders of Foreign Currency Accounts with the Bank. They availed the facility of Rupee Finances from the Bank against the security of their foreign currency deposits. The State Bank of Pakistan, respondent No,2 issued Circular No,12, dated 29-5-1998 whereby the opening of foreign currency accounts in the name of resident Pakistani nationals, firms and companies as well as the withdrawal from the existing foreign currency accounts was prohibited.
Later, another Circular No,17, dated 6-6-1998 was issued by respondent No,2 whereby the restriction on opening of new Foreign currency accounts was lifted. It was further directed that no fresh credit, except in respect of interest/profit accruing on existing deposits could be made in respect of the accounts mentioned in sub-para. (i) of paragraph 1 of Foreign Exchange Circular No,12 of 1998. It was also decided to allow deposits and withdrawals from the foreign currency accounts in certain cases specified in para. 2 of Circular No,17. The petitioners have challenged subsequent impugned FE Circular No,23, dated 2-71998 issued by the respondent-State Bank of Pakistan to all Banks/NBFIs.
The same is reproduced below:-- "SELECTIVE CREDIT CONTROL Please refer to section A (I11)2 of BCD Circular No,5, dated the 5th July, 1987 read with section 2 of BCD Circular Letter No,7/121-00-92, dated the 4th June, 1992 and Rule 10(iii) of Rules of Business for NIBFIs regarding margin requirement prescribed for advances against bank deposits and deposit certificates. It has been decided that encumbrance or lien of any kind upon any foreign currency/foreign currency certificates as a cover against any direct or indirect liability of the depositors must be removed by July 31, 1998 through set off or direct liquidation of the liabilities so covered by the borrowers.
No new encumbrance or lien should, thereafter, be created against foreign currency deposits/certificates held on May 28, 1998.
3. All Banks/NBFIs are further directed to give a compliance report to the State Bank within 3 days of the expiry of the deadline.
Please acknowledge receipt. Yours faithfully (Sd.)
MANSUR-UR-REHMAN KHAN, Director.
4. Mr. Salman Akram Raja, Advocate, the learned counsel for the petitioners, argued that the impugned Circular, dated 2-7-1998 amounted to expropriation of property without any such power vested in the State Bank of Pakistan. The impugned Circular was destructive of existing contracts regarding Rupee facility. The rights of the petitioners had been extinguished prematurely.
Compulsory taking over of the foreign currency deposits at Rs,46 per dollar had no nexus with the market rate. Despite the Proclamation of Emergency under Article 232 of the Constitution of Islamic Republic of Pakistan, 1973, the rights to property as envisaged by Article 2A read with Article 4 were alive and could not be taken away except in accordance with law. A law and an executive action could be made or taken in derogation of certain Fundamental Rights only if the same was made/taken after the Proclamation 'of Emergency. The existing laws were not protected by such Proclamation if they were otherwise violative of Fundamental Rights. The State Bank of Pakistan was not a "State" within the definition of Article 7 of the Constitution as it could not impose a tax or cess. The impugned Circular, dated 2-7-1998 was ultra vires the Statute. Even otherwise, it was submitted, the impugned action taken by the State Bank was unreasonable, arbitrary, in that, the foreign currency deposits had already been frozen which could not be withdrawn by the petitioners.
5. The learned counsel further submitted that the impugned Circular, dated 2-7-1998 was a device to take over the property of the petitioners which was not authorised by section 25 or 41 of the Banking Companies Ordinance, 1962 (hereinafter called the Ordinance) and was an instance of colourable exercise of executive power. In any case, it was contended, section 25 ibid did not allow any direction by the State Bank to have a retrospective effect so as to destroy vested rights. The doctrine of estoppel was pressed into service. The impugned action/Circular was violative of the Protection of Economic Reforms Act (No, XII) 1992. Even the Foreign Exchange (Temporary)
Restrictions Ordinance, 1998, promulgated on 28-5-1998 did not permit the taking of the impugned action. There could be no impairment of the contractual obligations under the garb of emergency measures or public welfare. The learned counsel submitted that the State Bank of Pakistan Act, 1956 (hereinafter called the Act) and the Ordinance were not protected by the provisions of clause
(1) of Article 233 of the Constitution of Pakistan. Section 41 of the Banking Companies Ordinance, 1962, was not applicable as it did not grant any power to acquire the property of the petitioners.
The police power could not be extended for taxing a citizen or acquiring his property unless expressly provided for. No compensation for acquisition of the foreign currency deposits had been provided for and the impugned action was calculated to destroy the business of the petitioners.
6. In support of his submissions, the learned counsel cited the cases of Islamia University, Bahawalpur through Vice-Chancellor v. Dr. Muhammad Khan Malik PLD 1993 Lah. 141, Camille v.
Treigle v. ACME Homestead Association (297 US 189), W.B. Worthen Company, Agent, George G.
Worthen, and Mollie P.Wor then v. Mrs. W.D. Thomas (292 US 426), W.B. Worthen Company v. Coburn C. Kavanaugh (295 US 56), United States Trust Company of New York, etc. v. State of New Jersey (431 US 1), Collector of Central Excise and Land Customs and 3 others v. Azizuddin Industries Ltd., Chittagong PLD 1970 SC 439, M/s. Ilahi Cotton Mills and others v. Federation of Pakistan and others PLD 1997 SC 582, Commentary on the Constitution of India, Sixth (Silver) Jubilee Edition, Volume J, pages 105 and 106 by Dr. Durga Das Basu, Ittefaq Foundry v. Deputy Collector Customs PLD 1990 Lah. 121, Ex-Captain K.0 Arora v. State of Haryana AIR 1987 SC 1858 paras.14-15, M/s. Yasin Sons v.
Federation of Pakistan and another PTCL 1990 CL 438, M/s. Moti Lal Padampat Sugar Mills Company Limited v. State of Uttar Pradesh and others AIR 1979 SC 621, Union of India and others v. M/s. Anglo- Afghan Agencies, etc. AIR 1968 SC 718, M/s. Army Welfare Sugar Mills Limited and others v.
Federation of Pakistan and others 1992 SCMR 1652, Federation of Pakistan and others v. Ch. Muhammad Aslam and others 1986 SCMR 916, Pakistan through. Secretary, Minister of Commerce and 2 others v. Salah-ud-Din and 3 others PLD 1991 SC 546, Treatise on Constitutional Law by Ronald D. Rotunda, Second Edition, Volume 2, pages 484-486, 517 and 521, Black's Law Dictionary Abridged Sixth Edition pages 845-846, Constitutional Law of India by H.M. Seervai, Third Edition, pages 130, 131 and and 135, Qazalbash Waqf and others v. Chief Land Commissioner, Punjab, Lahore and others PLD 1990 SC 99 at pages 245, 249 and 261, Federation of Pakistan and another v. Malik Ghulam Mustafa Khar PLD 1989 SC 26(44), Province of Punjab through its Home Secretary and 3 others v. Gulzar Hassan, Advocate and 8 others PLD 1978 Lah. 1298, Government of Pakistan and another v. Messrs Mardan Industries Ltd. And another 1988 SCMR 410, M. Younis Malik v. The State Bank of Pakistan through Deputy Director (Foreign Exchange), Lahore and 3 otehrs PLD 1981 Lah. 181, Bennett Coleman & Co. Ltd. And others v. Union of India and others AIR 1973 SC 106, Hashwani Hotels Limited v. Federation of Pakistan and others PLD 1997 SC 315, Mian Muhammad Nawaz Sharif v.
President of Pakistan and others PLD 1993 SC 473, Wajid Sharnas-ul-Hassan v. Federation of Pakistan through Secretary, Ministry of Interior, Islamabad PLD 1997 Lah. 617 and Olga Tellis and others v. Bombay Municipal Corporation and others AIR 1986 SC 180.
7. Mr. Maqbool Ilahi Malik, Senior Advocate, for the petitioner (W.P. No,14759 of 1998) argued that re- payment of loan to the petitioner against foreign currency deposits was to mature in the year 2002.
He submitted that in order to create a liberal environment for saving and investment, the Protection of Economic Reforms Act, 1992, was enacted. The object of the said Act was to provide legal protection to the reforms in order to create consistency in the establishment and continuity of the liberal economic environment created thereby as envisaged by the preamble of the Act of 1992. Reference was, made to the provisions of sections 1(b), 4 and 5 of the said Act. He argued that the Government could not torpedo contractual obligations between the Bank and the petitioners.
The system of issuance of dollar bonds was no answer to the acquisition of the foreign currency deposits of the petitioners as the same had no international acceptance. The foreign deposits were about 70% by the residents and 30% by non-residents. It was stated that section 25 of the Ordinance was regulatory and not confiscatory in nature. Reference was made to a recent interview of the Governor of State Bank of Pakistan as published in the newspapers.
8. Mr. Imtiaz Rashid Siddiqui, Advocate for the petitioners (W.Ps.15071 of 1998 to 15074 of 1998) argued that for he purposes of the present controversy, the Protection of Economic Reforms Act, 1992, was not relevant. The Fundamental Rights guaranteed in the Constitution were not enforceable for the time being. The Foreign Exchange (Temporary Restrictions) Ordinance, 1998, was only a regulatory measure. The said law had overridden the provisions of the 1962 Ordinance.
The learned counsel vehemently contended that the protection as to the property rights of the petitioners provided in Article 4 of the Constitution of the Islamic Republic of Pakistan continued to be available despite the Proclamation of Emergency. The direction by the State Bank of Pakistan could be issued under section 25 of the Ordinance only where conditions of public interest were fulfilled, In any case, the impugned Circular, dated 2-7-1998 could not be given a retrospective effect. The learned counsel referred to the cases of Hashwani Hotels Limited (supra), Lt.-Col. Farzand Ali and others v. Province of West Pakistan through the Secretary, Department of Agriculture, Government of West Pakistan, Lahore PLD 1970 SC 98 and Haji Hashmatullah and others v. Karachi Municipal. Corporation and others 1975 SCMR 359. The learned counsel heavily relied on the case of Molasses Trading and Export (Pvt.) Limited v. Federation of Pakistan and others 1993 SCMR 1905 in which it was held that a statute could not be read in such a way as to change accrued rights, the title to which consisted in transactions past and closed or any facts or events that had already accrued,
9. Sh. Javed Sarfraz, Advocate, for the petitioner (W.P. No,15085 of 1998, argued that the impugned Circular, dated 2-7-1998 was invalid inasmuch as the existing facilities of loan advanced to the petitioner against foreign currency deposits could not be withdrawn. He argued that the loan facility was given to the petitioner on 28-2-1989 and the same was re-scheduled so as to mature on 30-2-1999.
10. Kh. Hassan Tariq Rahim, Advocate, for the petitioner (W.P. No,14797 of 1998), argued that the impugned Circular dated 2-7-1998 was without lawful authority inasmuch as the same was repugnant to the provisions of the Protection of Economic Reforms Act, 1992. The other learned counsel appearing for the petitioners adopted the arguments of Mr. Imtiaz Rashid Siddiqui and Mr.Salman Akram Raja, Advocates.
11. On the other hand, Mr. Sher Zaman Khan the learned Deputy Attorney-General for Pakistan, argued that by virtue of the Proclamation of Emergency under Article 232 of the Constitution, the Fundamental Rights contained in Articles 15 to 19 and 24 stood suspended by virtue of clause (1) of Article 233 of the Constitution. The legislative and executive acts could no longer be tested on the touchstone of the Fundamental Rights as long as the emergency continued. The impugned Circular letter, dated 2-7-1998 was not challengeable with reference to the Constitutional provisions. It was further argued that the impugned Circular Letter had the statutory backing of the provisions of the Foreign Exchange (Temporary Restrictions) Ordinance, 1998, sections 25 and 41 of 1962 Ordinance and 1956 Act. The impugned Circular was issued in the public interest to adjust the loans in Pakistan Rupee against the foreign currency accounts. The impugned action was under the Prudential Regulations of the State Bank of Pakistan whereby the liquidation of the foreign deposits against the advances and loans was permissible. It was the policy decision which was not subject to judicial review by the Courts. He further argued that even if an order was without jurisdiction but doing complete justice and in the national interest. The same was not to be struck down in writ jurisdiction. Reference was made to the cases of Mrs. Habiba Jilani v. The Federation of Pakistan through the Secretary, Ministry of Interior, Government of Pakistan, Islamabad PLD 1974 Lah. 153 and Baker v. Car (1962) 369 US 186.
12. Dr. Muhammad Yaqoob, Governor, State Bank of Pakistan, also appeared under the orders of this Court. He stated that it was for the State Bank of Pakistan to formulate a credit policy as to what security should be accepted for the purpose of borrowing from the Banking Companies. Under the previous policy of the Bank, the foreign currency deposits were considered to be proper security.
However, the experience was found to be detrimental to the public interest as also to the Banking Companies and Banking system. The impugned circular was not necessarily calculated for the liquidation or appropriation of the foreign deposits or for the encashment thereof. The loans given by the Banks with foreign currency deposits securitization were required to be secured or liquidated. In the past, sugar stocks were financed by the Bank. Thereafter, it was found that in the middle of the year, the sugar stocks were held to raise the prices of sugar. The State Bank of Pakistan realised that the public interest was jeopardised by such a policy. Instructions had to be issued to liquidate such credits. Similarly, by another Circular, certain restrictions were imposed whereby an importer could import only if he put 30% of the import price from his own Banking Companies, etc. i4. I have given my anxious considerations to the submissions made by the learned counsel for the parties, the Governor and the advisor of the State Bank of Pakistan.
15. A Proclamation of Emergency was issued on 28-5-1998 by the President of Pakistan under Article 232 of the Constitution. It was laid before, and approved by a resolution of the joint sitting of the Parliament. The Hon'ble Supreme Court has already upheld the Proclamation. However, the Honourable Supreme Court struck down the Presidential Orders issued under clause (2) of Article 233, whereby, the right to move a Court for the enforcement of certain Fundamental Rights conferred by Chapter I of Part II of the Constitution was suspended. Clause (1) of Article 233 provides that while a Proclamation of Emergency is in force, nothing contained in Articles 15 to 19 and 24 restrict the power of the "State", as defined in Article 7. To make any law or to take any executive action in derogation thereof.
16. Article 24 provides that no person shall be deprived of his property save in accordance with law nor a property shall be compulsorily acquired taken into possession save for a public purpose by the authority of law providing for compensation therefor.
17. But the Emergency does neither create power nor does it increase the granted power or remove or demolish the restrictions imposed on such power. The Constitution of Islamic Republic of Pakistan, 1973 was itself enacted in an atmosphere of a grave emergency when a part of the country and already been sliced away. The Constitution grants power to the Federal Government and limitations on the power are also determined in the light of the emergency. They are not altered by the emergency which may furnish an occasion for the exercise of power. It is, however, clear that an emergency may not call into life a power which has never lived. Nevertheless, it may afford a reason for the exertion of the living power already enjoyed without, of course, destroying or impairing the Constitutional rights and obligations, unless they are validly affected and impaired.
18. Article 233 appears to be an exception of Article 8 which already lays down that the State shall not make any law which takes away or abridges the rights so conferred. Any law made in contravention of the said Article shall, to that extent, be void. Thus, the State may make a law or take any executive action during the period of emergency even if it is in conflict with Articles 15 to 19 and 24. But, it does not mean that the laws and action which were already made taken before the Proclamation of Emergency would also be immune from being tested on touchstone of Articles 15 to 19 and 24. The laws made or the executive action taken during the period of emergency are covered by clause (1) of Article 233. If an executive action is taken which is in violation of law, the same will not be protected, merely by reference to clause (1) of Article 233 of the Constitution of Pakistan. The suspension of the enforcement of the specified Fundamental Rights would not affect all other Fundamental Rights guaranteed by the Constitution. The limitation on the enjoyment or the enforcement of Articles 15 to 19 and 24 is to be narrowly constructed being a deviation of the normal Constitutional system during the period of emergency.
19. The validity of the impugned circular dated 2-7-1998 has to be examined with reference to the relevant provisions of law under which the same was said to have been issued. Section 25 of the Ordinance, 1962, provides that the State Bank of Pakistan may determine the policy in relation to the advances to be made by the Banking Companies generally or in particular where it is satisfied to do so in the public interest. It further lays down that the State Bank may give directions to the Banking companies as to the credit ceilings or targets prohibiting giving of loans, advances and credit to any borrower on the basis of interest either for specific or any other purpose. Section 41 of the Ordinance, 1962, further empowers the State Bank of Pakistan to issue directions to the Banking Companies where it is satisfied so to do in the public interest or to prevent the affairs of any Banking Company from being conducted in a manner prejudicial or detrimental to the interest of the depositors or the Banking Company and to secure a proper management of any Banking Company. The State Bank of Pakistan may, however, modify or cancel any such directions. The provisions of section 41 of the 1962 Ordinance are identical with section 35-A of the India's Banking Regulation Act, 1949.
20. The scope of the powers of the Reserve Bank of India to give directions to the other Banks under section 35-A of the Banking Regulation Act, was examined in the case of Janta Sahakari Bank Limited v. The State of Maharashtara (1995) 82 Company Cases 707. In the precedent case, the reserve Bank of India directed the Registrars of the Cooperative Societies prohibiting them from making the donations of more than 1% of the published deposits of the previous year and for an amount exceeding Rs,10,000. The writ petitioner, Cooperative Bank challenged the direction of the Reserve Bank of India on the grounds that such a direction was not authorised either by the Act of 1949 or by the Maharashtra Cooperative Societies, Act. A Division Bench of the Bombay High Court made the following observations:-- "Considering section 35-A of the Banking Regulation Act, 1949 minutely we feel that the submission of Dr. Naik cannot be accepted. Section 35-A(l)(aa) states that where the Reserve Bank is satisfied that 'in the interest of Banking policyit is necessary to issue directions...
Banking policyas defined in section 5(c) clearly stipulates that it means a policy which is specified from time to time by the Reserve Bank of India in the interest of the Banking system or in the interest of monetary stability or sound economic growth, having due regard to the intersts of the depositors, the volume of deposits and other resources of the Bank and the need for equitable allocation and the efficient use of these deposits and resources. Thus, an overall responsibility to find out the well-being of a Banking Company, in improving monetary stability and economic growth as well as keeping in view the interests of depositors, the reserve Bank of India has to formulate its policy vis-a-vis Banking Companies. 'Bankingas defined in section 5(b) only gives a grammatical meaning of the transactions of a bank and nothing more. If any management or supervision is to be done over the banking activities of a bank, it will have to be governed by banking policy. Regard will have to be given to the fact that Cooperative Banks like any other Banking companies are entrusted with the funds from the public. The amounts are in trust with them which are payable on demand to the public and hence, deposits or the profits earned from the same or their capital have to be augmented rather than depleted and if excess amounts are likely to be depleted by way of donations for charitable and public purposes, the very stability of a Cooperative Bank may come in danger. We feel that 'banking policy and 'bankingare not independent but coordinating subjects and both are covered within the supervisory powers of the Reserve Bank of India within the meaning of section 35-A of the Banking Regulation Act. Even otherwise, we feel that the directions issued by the Reserve Bank of India are in the larger interest of the public and the Reserve Bank of India being a body of experts in banking, the directions given by it should not be lightly brushed aside."
The above observations are quite relevant to the present case. Section 25 of the 1962 Ordinance empowers the State Bank of Pakistan to control the advances by the Banking Companies. It would, thus, appear that provisions of sections 25 and 41 of the Banking Companies Ordinance are controlling and regulatory in nature. The State Bank of Pakistan is charged with the statutory duty to determine the policy in relation to the advances and to give necessary directions to the Banking Companies in order to prevent the affairs of any Banking Company from being conducted in a manner prejudicial or detrimental to the interests of a Banking Company or the depositors.
The impugned Circular dated 2-7-1998 is a policy decision of the State Bank of Pakistan. It has been directed that an encumbrance or lien of any kind upon any foreign currency deposits or certificates as a cover against any direct or indirect liability of the creditors must be removed through a set off or liquidation of the liabilities so covered by the borrowers. It has been further directed that, in future, no encumbrance or lien should, therefore, be created against the foreign currency deposits/certificates. Such a direction is clearly supportable by the provisions of sections 25 and 41 of 1962 Ordinance being regulatory in nature. No legal objection could be taken by the petitioners as the Banking Companies have been asked to remove the encumbrance or lien of any kind of any foreign currency deposits/certificates as a cover against any direct or indirect liability of the depositors through a set off or liquidation of the liabilities so covered by the borrowers.
It is a case of requiring a security cover of loans otherwise than by way of foreign currency deposits. In the opinion of the State Bank of Pakistan, such a practice has already caused a lot of damage to the country by speculating the Stock Exchange. None of the provisions of the Banking Companies Ordinance, 1962, had been called in question by the petitioners.
23. The foreign currency deposits of the petitioners have not been taken away by the impugned action of the State Bank of Pakistan. The same will be used for setting off or liquidation of the loan liability of the petitioners if they fail to provide any satisfactory and adequate security by due date.
This is necessary as the loans already given to the petitioners cannot be left without security cover.
It was for this reason that a time up to 31st July, 1998 was granted by the State Bank. The Governor, State Bank of Pakistan, also stated that the said time limit was likely to be extended for further one month to facilitate the implementation of Circular dated 2-7-1998.
24. The controlling power of the State Bank of Pakistan includes giving of the instructions of the nature of the impugned Circular. The word "control" is a term of art and the power to control includes the power to prohibit, to restrict or to check. In the case of State of West Bengal v.
Nirependra North Baghi AIR 1966 SC 447, the word "control" in Article 235 of the Constitution of India was held to include a disciplinary jurisdiction of the High Court over its subordinate Courts. In the case of Corporation of Nagpur v. Ram Chandra AIR 1984 SC 626, it was observed that the word 'controlwas a very wide connotation and amplitude including a large variety of power which was incidental or consequential to achieve the powers vested in authority concerned. Somewhat similar view was taken in the cases reported n PLD 1964 SC 126 and PLD 1982 SC 113.
25. It is now well settled that acts performed or orders made by the public authorities deserved due regard by the Courts and every possible explanation for their validity is to be explored. Reference may be made to the cases of Government of Sindh through Chief Secretary and others v. Khalil Ahmad and others 1994 SCMR 732, The Chairman, East Pakistan Railways v. Sardar Abdul Majeed PLD 1966 SC 725, The Lahore Improvement Trust v. Custodian, Evacuee Property and others PLD 1971 SC 811 and Khawaja Ahmad Tariq Raheem Bar-at-Law v. The Federation and another PLD 1991 Lah.
178 (Full Bench).
26. Article 4 of the Constitution recognizes the inalienable right of every citizen, inter alia, against any action detrimental to property being taken except in accountancy with law. It means that if a law is valid and is not violative of the provisions of the Constitution, an action taken in conformity therewith would ordinarily be saved unless taken mala fide, coram non judice or without jurisdiction. I am of the view that the impugned actions taken through Circular letter No,23 dated 2- 7-1998 is covered by the provisions of 1962 Ordinance and does not suffer from any pint of invalidity.
27. None of the Fundamental or other legal rights of the petitioners appear to have been violated or infringed by the impugned Circular Letter. Foreign currency deposits have not been taken away.
These would be liquidated and set off if by a fixed date the petitioners failed to provide satisfactory security for the loans they had already taken.
28. I need not go into the other question as to whether the State Bank of Pakistan is to be treated as a "State" within the meaning of Article 7 or 233 of the Constitution of Pakistan. I, therefore, need not express any final opinion on this aspect which shall be examined in any appropriate case. The Hon'ble Supreme Court has held in Kaneez Fatima's case PLD 1993 SC 901 that a Court need not go into the Constitutional questions if a case can be disposed of on the other grounds. However, reference may be made to the case of State Bank of India v. Kalpaka Transport Co. (Pvt.) Limited and another AIR 1979 Bombay 250 where the State Bank of India was held to be a "State" within the meaning of the Constitution. Somewhat wide meaning to the term "State" was given in the case of Government of N.-W.F.P. Through Chief Secretary and another v. Muhammad Irshad and 3 others PLD 1995 SC 281. In the present case, it really not matter whether the State Bank of Pakistan is a "State" or not within the meaning of Article 7 of the Constitution. State Bank of Pakistan is performing its duties in connection with the affairs of the Federation and is, therefore, amenable to the writ jurisdiction. I may usefully refer the case of Syed Akbar Ali Bokhari v. The State Bank of Pakistan and 7 others PLD 1977 Lah.
234.
29. The impugned Circular Letter, dated 2-7-1998 does not in any manner violate any of the provisions of the Protection of the Economic Reforms Act, 1992. The freedom to bring, hold, sell, take out the foreign currency and to maintain the foreign currency accounts with immunity from any inquiry from the Income-tax Department or any other Taxation Authority as to its sources remains intact without any infringement or violation of the Act 1992 by the impugned Circular. The learned counsel for the petitioners have failed to satisfy as to how the impugned Circular was violative of Article 2A or any other provisions of the Constitution or any other law. I, therefore, hold that the impugned Circular by the State Bank of Pakistan was validly and lawfully issued.
30. For the foregoing reasons, I do not find any merit in these writ petitions which are hereby dismissed in limine.
31. Before parting with this order, I would like to express my appreciation for the valuable assistance rendered in these cases by the learned counsel for the parties particularly by M/s. Salman Akram Raja, Imtiaz Rashid Siddiqui, Maqbool Ilahi Malik, Javed Sarfraz, Kh. Hassan Tariq Rahim, Advocates and Mr. Sher Zaman Khan, learned Deputy Attorney-General for Pakistan.