MUHAMMAD MUJEEBULLAH SIDDIQUI, J.---The above appeals are directed against the Judgment dated 8-1-2004, given by Accountability Court No,IV, Sindh Karachi, in Reference No,25 of 2002, whereby each appellant has been convicted under Section 10 of the N. A. B. Ordinance, 1999, for the commission of offence under Section 9(a)(vi) of the National Accountability Bureau Ordinance, 1999, and has been sentenced to undergo R.I. For 7 years and to pay fine of Rs,2.00 million and in default to undergo further R.I. For one year. The appellants have been further disqualified from being elected, chosen, appointed or nominated as member of representative of any public body or any statutory or local authority or in service of Pakistan or any Province and have also been forbidden from obtaining any financial facility in the form of loan or advances from any financial institution controlled by the Government, for the period of ten years, under section 15 of the NAB Ordinance.
2. The facts giving rise to these appeals are that on 2-7-2002, the Chairman National Accountability Bureau, submitted a reference under section 18(g) R/W 24(B) of the NAB Ordinance 1999, before the Accountability Court No, IV, at Karachi, against the two appellants and absconding accused Rear Admiral (R.) Jawaid Ali, stating as under:-- "(1).That in the year 1994, accused No,3, while he was Chairman PNSC obtained an approval for acquisition/purchase of ships for PNSC. Subsequently he was appointed as Chief of Naval Staff and thus by virtue of this office, and being Adviser to Prime Minister on Maritime Affairs, he remained entrusted with the work to supervise/oversee the process of acquiring the ships already approved.
(2) That the accused No.3 after taking over charge as CNS met the then Prime Minister in November, 1994 and by exercising his influence manipulated the appointments of accused No,1 as acting Chairman and accused No,2 as Director (Ship Management) PNSC with the object that the accused Nos.1 and 2, will not question any decision taken by him for the purchase of ships for PNSC and thus he will be able to use them for making dishonest and unlawful personal gains for himself and for the said accused Nos.1 and 2.
(3) That on the receipt of an information that accused misused their authority and dishonestly or fraudulently caused huge loss to PNSC an investigation was ordered. The investigation report has prima facie established that accused persons have indulged in the abuse of their authority and /or wilfully failed to exercise their authrity and acted in a manner which has caused loss to the State exchequer which they could have prevented.
(4) That investigation report shows that following three ships were purchased at the price indicated against each which was much higher than the prevailing price in the market of the ships of same specifications and conditions:--
(a) Apolonia (re-named as Sawat) US$ 14.82 millions
(b) Ora Bhum (re-named as Shalamar) US$ 15.55 millions
(c) Independent voyager (re-named as Lalazar) US$ 16.77 millions Total: US$ 47.14 millions Besides above, the ship at serial (a) had already been rejected at initial stage by accused No,2, being head of technical committee. However, it was deceitfully got approved from the Board of Directors and the purchase of ship at serial (b) was also against the laid down procedure of Board of Directors, which required the inspection of classification record of the vessel before considering the purchase. The selection of above vessels was also against and in violation of. ECC's approved capacity. As such accused Nos.1 and 2 in clandestine manner got the same approved in connivance with accused No,3, and they deliberately omitted to stick to quality and specifications of ships which were best suited for the commercialinterest of the PNSC/State. Exemption of 10% customs duty and 5% regulatory duty and any other duties applicable on purchase of ship was to expire on 31-12-1995. Without obtaining approval for extension of exemption of import duty, above vessels were inducted into the fleet of OPNSC as per dates given below:--
(1) Apolonia (Sawat) 1983 7-2-1996
(2) Ora Bhum (Shalamar) 1983 7-3-1996
(3) Independent Voyager (Lalazar) 13-6-1996
5. That at the relevant time the average price of the three ships of the same capacity and conditions in the world market was US$ 9.37 million as such the ships in question were purchased at an exorbitant price with the difference of US$ 19 million.
6. The evidence shows that MV. Lalazar (Independent Voyager) resulted a total loss to the tune of Rs,483.392,000 during the period of February 1996 to December, 2000. MV. Shalamar (Ora Bhum)
Rs,677,820,000 during the period from March 1996 to December 2000, and MV Sawat (Apolonia)
Rs,690,531,000 during the period from June, 1996 to December, 2000. Hence the grand sum of total loss to the tune of Rs,1851,743,000 has been sustained by the PNSC/Govt. Exchequer. The detail are mentioned in the investigation report.
7. That sufficient material came on record by way of ocular as well-as documentary evidence to show that all the accused persons in active connivance with each other and with guilty intention indulged in the acts of misuse of authority and/or wilfully, failed to exercise their authority and thus committed acts of corruption and corrupt practices which constitutes an offence under section 9 read with schedule to the NAB Ordinance, 1999 and is punishable under section 10 of the Ordinance.
8. That accused No,3 as CNS did not enjoy good reputation and has been found to be corrupt and deemed to have been convicted in another reference of corruption against him and this conduct has been reflected in the transaction of purchase of ships through his associates/co-accused.
9. That on the appraisal of the material and evidence placed before me, I am of the opinion that it is just and proper to proceed further as there is sufficient material to justify the filing of the Reference. The matter is referred to the Hon'ble Court within the meaning of section 16(c) of NAB Ordinance. The Hon'ble Court may try the case himself or assign it for trial to any other Accountability Court established at Karachi.
It is respectfully prayed that the accused be tried and punished in accordance with law. List of witnesses, report of investigation and documents as per list are attached herewith,"
3. Rear Admiral (R.) Jawaid Ali, was declared absconder and trial commenced against the present appellants by framing of the charge which reads as under:- CHARGE "I, Muhammad Jawaid Alam, Judge, Accountability Court No,IV, Sindh, Karachi, do hereby charge you:--
1. Mansoor-ul-Haq son of Mian Ghulam Muhammad.
2. Cdre. Mirza Ashfaq Baig son of Mirza Mushtaq Baig as under:-- That you accused Mansoor-ul-Haq during the year 1994 were Chairman, PNSC and subsequently appoithed as Chief of Naval Staff and you accused Cdre. Mirza Ashfaq Baig were Director (Ship Management) PNSC and thus you both have been holder of public office. That you accused Mansoor-ul-Haq, with criminal intent, to obtain undue benefits got an approval for acquisition/purchase of ships for PNSC in the capacity of Chairman from E.C.C. Of,the then Government. Subsequently when you were appointed as Chief of Naval Staff, you hatched a conspiracy with absconding accused Rear Admiral (R.) Javed Ali and co-accused Cdre. Mirza Ashfaq Baig, who was a serving Naval Officer and you by using your influence obtained directions from the Government to over-see the purchase/acquisition of ships for PNSC. According to which despite you had been appointed CNS, in all matters concerning the said Program your approval was binding upon the Board of Directors of PNSC in order to achieve your ulterior motives, you got appointed your men Real Admiral Javed Ali, absconding accused as Acting Chairman PNSC and Cdre. Mirza Ashfaq Baig as Director (Ship Management) PNSC. That you both accused in collaboration, connivance and collusion with each other and absconding accused Rear Admiral (R.) Javed Ali misused your official authorities in purchasing following 3 ships. You violated, the laid down procedure, terms of approval and purchased the ships on the exorbitant price much higher than the prevailing price in the market of the similar specifications and conditions. The said ships were not technically suitable and even were rejected/not evaluated. The purchase of ships was against the selection criteria of the Board of Directors of PNSC and E.C.C. Of the Government and without considering the classification record of the ships, payment of customs, regulatory and other duties.
(a) Apolonia (re-named as Sawat) US$ 14.82 millions
(b) Ora Bhum (re-named as Shalamar) US$ 15.55 millions
(c) Independent voyager (re-named as Lalazar) US$ 16.77 millions Total: US$ 47.14 millions Besides, by your such fraudulent actions and misusing your official authority the exchequer sustained clossal loss to the tune of Rs,1,851,743,000.
That you both in collusion, connivance and collaboration with each other and absconding accused Rear Admiral (R.) Javed Ali wilfully, fraudulently misused your official authority to obtain undue benefits and failed to exercise your authority to prevent the losses to the exchequer and thereby committed an offence of corruption and corrupt practices as defined under Section 9 punishable under Section 10 of National Accountability Bureau Ordinance, 1999 within the cognizance of this Court. And I hereby direct that you both be tried by this Court on the aforesaid charges."
4.. Both the appellants pleaded not guilty to the charge.
5. In support of the reference/charge the prosecution examined 16 witnesses, namely P.W.1, Syed Mehmood Ali, the then General Manager, Head of Planning Department, Exh:10, P.W.2, Jawaid Mansoor, the then Secretary Board of Directors, PNSC, Exh:11, P.W.3, Syed Intizar Haider, the then General Manager PNSC, Exh:12, P.W.4, Muhammad Khusro Khawaja, the then Director PNSC, Exh:13, P.W.5, Arif Saeed, Exh:14, P.W.6, Bashir Ahmed, Director Ports and Administration, Exh:15, P.W.7, Muhammad Haziq Sualeh, Ex-General Manager, PNSC, Exh:16, P.W.8, Fazlur Rehman, the then Director Finance PNSC, Exh:17, P.W.9, Captain Sadiq Hayat, Exh:18, P.W.10, Muhammad Zaki Khan, Exh:19, P.W. Jahangir Siddiqui, the then elected Director, PNSC, Exh:20, P.W.12, Muhammad Sajid, Chartered Financial Analyst, Exh:21, P.W.13, Jawaid Saleem, the then Deputy Director, Ministry of Industries, Exh:23, P.W.14, Ahmed Sadiq, Ex-Principal Secretary to the Prime Minister Ms. Benazir Bhutto, Exh:24, P.W.15, Pervez Afzal. Khan, the Chief Executive Officer and Ex-Vice President, Corporate Finance Department of Bear Stearn Jehangir Siddiqui & Co. Exh:25 and P.W.
1.6, Altaf Hussain, Assistant Director F.I.A, Investigating Officer, Exh:27.
6. Statement of appellant/accused Mansoorul Haq under section 342, Cr.P.C. Was recorded as Exh.29. He denied all the prosecution allegations and claimed to be innocent. Statement of accused/appellant Mirza Ashfaq Baig under section 342, Cr.P.C. Was recorded vide Exh.30. He also denied all the prosecution allegations and stated that no witness has deposed against him. He took plea that no loss was sustained by the PNSC due to technical fault in the ships and the ships were still sailing in the high seas. Accused/appellant,Mirza Ashfaq Baig, examined one witness in defence namely Vice-Admiral Taj Muhammad Khattak, Chairman, Port Qasim Authority, Exh:31.
7. The learned trial Court framed the following points for deter mination: --
(1) Whether the accused Rear Admiral (R.) Javed Ali has absconded deliberately in order to avoid the service of process issued by this Court or prevent or evade service of warrants upon him or concealed himself to screen himself from the proceedings of the reference of punishment under this Ordinance ?
(2) Whether the accused Mansoorul Haq, the then Chairman PNSC and accused Mirza Ashfaq Baig, the, then Director (S.M) Ship Management PNSC in the year 1994 were holders of public office?
(3) Whether the investigation conducted by the Investigating Officer Altaf Hussain in pursuance of authorization letter Ex.27/1 is beyond the scope of said letter and violative of Section 18 of National Accountability Bureau Ordinance, 1999 and therefore, illegal and unwarranted by law?
(4) Whether the accused Mansoorul Haq with criminal intent to obtain undue benefits got an approval of acquisition/purchase of ships for PNSC in the capacity of Chairman from Economic Coordination Committee (ECC) of the then Government?
(5) Whether the accused Mansoorul Haq in his capacity as Chief of Naval Staff hatched a conspiracy with absconding accused Rear Admiral (R.) Javed Ali and co-accused Mirza Ashfaq Baig, who was a serving Naval Officer and he by using his influence obtained directions from the Government to oversee the purchase/acquisition of ships for PNSC?
(6) Whether the accused Mansoorul Haq in order to achieve his ulterior motives got appointed his men Rear Admiral (R.) Javed Ali (now absconding) as Acting Chairman PNSC and Commodore Mirza Ashfaq Baig as Director (S.M) Ship Management PNSC?
(7) Whether both the accused in collaboration, connivance and collusion with each other and absconding accused Rear Admiral (R.) Javed Ali by violating the laid down procedure, terms of approval and misusing their authority purchased 3 ships viz. (a) Apolonia (renamed as Sawat) for US$ 14.82 million (ii) Ora Bhum (renamed as Shalamar) for US$ 15.55 million and (iii) Independent Voyager (renamed as Lalazar) for US$ 16.77 million on the exorbitant price much higher than the prevailing price in the market of similar specifications and conditions, and caused loss to the exchequer to the tune of Rs,1,851,743,000 and obtained undue benefits?
(8) Whether the purchase of these 3 ships was against the selection criteria of Board of Directors of PNSC and ECC of the Government and without considering the classification record of the ships, payment of customs, regulatory and other duties?
(9) Whether the accused Mirza Ashfaq Baig being member of Technical Committee of PNSC with ulterior motive and by misusing his authority had recommended M.V. Apolonia which was earlier rejected by him and also recommended M.V. Westertal without considering its classification record and thus favoured to co-accused persons to their advantage?
(10) Whether accused Mansoorul Haq wilfully misused his official authority while recommending purchase of 3 container ships on 28-12-1995 and favoured co-accused persons to their advantage?
(11) Whether accused Mansoorul Haq failed to exercise his authority to prevent purchase of ships when he knew that for want of exemption in customs and regulatory duty 3 container ships in question were not able to enter Pakistan waters and caused loss to PNSC and thereby committed an offence of corruption and corrupt practices as defined under Section 9 punishable under Section 10 of the National Accountability Bureau Ordinance, 1999?
(12) What offence, if any, the accused persons have committed?"
8. Point No .1, pertains to absconding accused Rear Admiral (R.) Javed Ali, The point was decided against the absconding accused. He was found guilty of the offence punishable under Section 31-A of the NAB Ordinance, 1999.
9. Point No,2, was answered in affirmative.
10. Point No,3, was decided in negative.
11. Point No,4, was decided in negative with the following findings:-- "There is nothing on record to suggest that Mansoorul Haq with criminal intent to obtain undue benefits got an approval of acquisition/purchase of ships for PNSC. On the other hand, it appears to be logical that Admiral Mansoorul Haq in his capacity as Chairman PNSC had endeavoured to strengthen the PNSC by inducting container ships and bulk carrier. He had submitted the proposal to the then Prime Minister Ms. Benazir Bhutto on her visit to PNSC in the national interest. She had allowed the proposal by allowing PNSC to purchase container ships. Here I fail to gather as to how Mansoorul Haq was having criminal intent to obtain undue benefits by getting an approval of acquisition of ships for PNSC from the then Prime Minister or from ECC of the then Government. The point in hand is therefore answered as not proved."
12. The point Nos. 5 & 6 were decided in the following terms:-- "I have perused the prosecuting evidence and statements of both the accused filed under section 265-F (5) Cr. P. C. No prosecution witness has deposed that absconding accused Rear Admiral (R.)
Javed Ali and co-accused Mirza Ashfaq Baig were men of accused Mansoorul Haq and accused Mansoorul Haq by exercising his influence and asserting his status as CNS had got them appointed as Chairman and Director(S.M) PNSC respectively with intention to achieve his ulterior motives. P.W.
Syed Mahmood Ali examined at Ex.10 has also not supported the prosecution so far allegations made in the points in hand are concerned. However, in view of documents produced by D.W. Taj Muhammad Khattak as Exh.31/1 to Exh.31/6 it can be deduced well that the evidence of Investigating Officer Altaf Hussain to the extent that appointment of accused Rear Admiral (R.) Javed Ali and accused Commodore Ashfaq Baig as Acting Chairman PNSC and Director PNSC respectively was result of interest, proposal and suggestion of accused Mansoorul Haq to the then Prime Minister in a meeting, gets corroborated.
The allegations of prosecution that the accused Mansoorul Haq in his capacity as Chief of Naval Staff had hatched a conspiracy with the absconding accused Rear Admiral (R.) Javed Ali and co- accused Mirza Ashfaq Baig, who was serving as Naval Officer lacks corroboration. For want of cogent evidence it cannot be said even, as to what was that conspiracy, however meeting of accused Mansoorul Haq with the then Prime Minister after about 7 days of his taking over as CNS and subsequent recommendations by CNS for appointment of Chairman PNSC and Director PNSC speaks volumes about the interest of accused Mansoorul Haq so far appointments of both the accused in PNSC is concerned. Though there is no direct evidence on record to reveal that suggestion of. CNS for appointment of Rear Admiral (R.) Javed Ali as Chairman PNSC and Naval Officer as full time Director PNSC was to achieve ulterior motives but from the circumstances and scrutiny of documents as discussed above and in absence of evidence in rebuttal as to why both officials were recommended for their appointment as Chairman and Director OPNSC respectively, the only presumption that can be drawn in the attending circumstances is that accused Mansocrul Haq was very much interested and instrumental in getting Rear Admiral (R.) Javed All and Mirza Ashfaq Baig being men of his confidence, appointed as Chairman, PNSC and full time Director PNSC respectively for achieving his ulterior motives. Here it can also be presumed that letter Exh.10/B produced by P.W. Syed Mahmood Ali was result of keen interest shown by the accused Mansoorul Haq in the acquisition of ships programme before Prime Minister and because of his interest and suggestion the then Prime Minister was pleased to agree the proposal made by the accused Mansoorul Haq. Mere denial is Hot enough. Accused Mansoorul Haq was burdened to disprove the allegations made in these points but he has failed to shift his burden. In view of what has been discussed above, I hold that Point No,5 stands partly proved whereas Point No,6 stands proved."
13. After threadbare examination of the evidence and elaborate discussion, the trial Court decided the Point Nos.7 and 8 in the following terms:- "In the minutes of meeting, it is stated that CNS on 13-12-1995 had called a meeting to review the progress of project. After full briefing of the status, CNS advised that he was ready to support the acquisition committee up to the price presently being asked by the owners. However it was resolved that initially quoted price had to be increased as the owners were not prepared to reduce their price substantially. In the same meeting, after full discussions on acquisition of ships, the Board resolved that a committee comprising of Rear Admiral (R.) Javed Ali Chairman PNSC, Mr. Muhammad Kaleem Director (SP&PL), Mr. Fazlur Rehman Director (Finance) and Mr. Muhammad Khusro Khawaja Director (Elect) and Mr. Javed Mansoor Secretary PNSC may proceed to London to negotiate and finalize the acquisition of 3 container ships in accordance with the guidelines given by the CNS in the meeting of 13-12-1995. Here it is again evident that Prime Minister's directives dated 20-1-1994 have been ignored as high powered committee named therein assisted by Board of Directors of PNSC did not negotiate the prices with owners of the ships but on the contrary another committee as stated above was deputed to London to negotiate and finalize the acquisition of 3 container ships. The minutes of meeting of the Board of Directors of 16-12-1995 read that class record of the vessels was examined and first 3 ships were also inspected and found acceptable but there is no documentary evidence to support the minutes of meeting as to who checked the class record of the vessels except report dated 13-11-1995 submitted by Mirza Ashfaq Baig in which he had checked the class records of 8 vessels and recommended first 5 vessels except Apolonia which was not recommended even for consideration, due to main engine problem. In this report there is no mention of Westertal. MV Westertal was first enlisted and disclosed by the Chairman in the meeting dated 16-12-1995 and that was included on the basis of brokers report Exh.10/11. The perusal of minutes of meeting 16-12-1995 para. 8 reveals that C.N.S. In meeting dated 13-12-1995 had reviewed the progress of the project and approved the prices negotiated by the acquisition committee. It is fact that E.C.C. Had authorized the Board of Directors of PNSC to handle the ship acquisition programme vide decision dated 29-8-1994 but it does not mean that Board of Directors were given free hand to adopt the procedure of their choice. They were required to handle the acquisition programme within four corners of the Prime Minister's directives, procedure already approved in the meeting dated 25-5-1995 and in accordance with the revised feasibility report and M.O.U.
Signed between PNSC and National Bank of Pakistan. These were the parameters for the Board of Directors to carry on the acquisition programme but here as discussed above, it is very clear that Board of Directors did not care about the directives given by the Prime Minister, laid down procedure, terms of approval and revised feasibility report, as such, by misusing their authority they purchased 3 container ships in collaboration, connivance and in collusion with each other and absconding accused Rear Admiral (R.) Javed Ali. So far question of purchase of 3 ships viz. (I) Apolonia for US$ 14.82 million, (ii) Ora Bhum/Westertal for US$ 15.55 million and (iii) Independent Voyager for US $ 16.77 million on exorbitant prices much higher, than the prevailing prices in the market of similar specifications and conditions is concerned, there is no positives evidence on record to suggest that the prices at which these ships were purchased were exorbitant as no witness or broker has been examined to depose about the prices of ships of similar specifications and conditions prevailing in the international market in the year 1995. Prosecution was required to prove that at the relevant time prices of the ships of similar specifications and conditions were lesser than the prices against which these 3 ships were purchased. Mere allegation is not enough until it is proved. Prosecution witnesses so far examined have failed to depose the prices prevailing at the relevant time, hence it will be unjustified to hold that these 3 ships were purchased on exorbitant prices much higher than the prevailing prices in the market. So far allegation of causing loss to the exchequer to the tune of Rs,1,85,743,000 and obtaining undue benefits is concerned, prosecution has also failed to bring cogent evidence to prove this allegation. To support this allegation prosecution has examined witnesses but none has specifically stated about the losses alleged to have been sustained by PNSC at the hands of the accused... ... ... Perusal of evidence of Investigating Officer shows that in the cross-examination he has admitted that losses calculated in his report are not based on any audit report. He has voluntarily said that losses were supplied to him by the PNSC accounts department. He has further admitted that losses he has shown in his report and manifested in the reference are operational losses of the ships in question. He has further admitted that Mansoorul Haq as Chief of Naval Staff was not in any manner concerned with the operation of the ships. He has further admitted that operation of ships was purely function of the officers concerned of PNSC. He has further admitted that determination of the routes of the ships was also the function purely of the officers of the PNSC and CNS had no concern with it. He has also admitted that he has not attributed specifically any loss against Mansoorul Haq. He has replied further that losses which he has shown in his report and manifested in the reference are the operational losses for the period 1996 to 2000. He has also admitted that he has not been able to collect any evidence of any private conversation or negotiation with either the international brokers or ship owners for illegal gain by Admiral Mansoorul Haq. The evidence of witnesses so far examined to prove losses as discussed above, suggest that the alleged losses are operational losses and those losses do not stand proved through positive evidence however same cannot be attributed to the accused persons. They cannot be held responsible for the operation of ships when they were on charter and when they were brought into Pakistan waters. Admittedly, it was not within the functions of CNS or any other Director and for operation of the ships separate wing is functioning in the PNSC. Moreover, for alleged losses, if any, there could be so many reasons as have been stated by the witnesses. In the circumstances as discussed above, I am of the considered opinion that the alleged losses cannot be attributed to the accused persons and consequently they cannot be held responsible for the same, if any.
In view of what has been discussed above, Point No,7 stands partly proved and Point No,8 is answered as proved."
14. While deciding Point No,9, the learned trial Court held that appellant Commodore Mirza Ashfaq Baig, initially rejected ship MV-Apolonia on account of engine problems and did not recommend the dame for consideration but subsequently recommended the said ship for purchase and consequently Point No,9 was decided in affirmative. It would be appropriate to pause here for a moment, and observe that although in the Point No,9, the question for consideration was whether Commodore Mirza Ashfaq Baig with ulterior motive and by misuse of his authority recommended MV-Apolonia, earlier rejected by him and also recommended MV-Westertal without considering its classification record and thus favoured to accused persons to their advantage, but the learned trial Court decided this point in affirmative merely by giving a finding that appellant Mirza Ashfaq Baig, had earlier. Rejected MVApolonia and subsequently recommended the same, without adverting to the 'ulterior motiveon the part of appellant and without giving any finding as to how, the recommendation was motivated for the purpose of favouring to co-accused persons to their advantage. It is also contradictory to the earlier findings of the trial Court to these effect that no exorbitant price was paid for the purchase of any ship and no loss was caused to the exchequer or PNSC.
15. The Point Nos.10 and 11 were decided as follows:-- "Having perused the prosecution evidence and arguments of both counsel, I am of the opinion that accused Mansoorul Haq in view of Ex.10/8 was required to oversee the entire project of acquisition of ships honestly, fairly and diligently keeping in view the interest of PNSC. Prosecution has brought sufficient evidence on record to prove that accused Mansoorul Haq has failed in his duties of overseeing the project fairly, honestly and in accordance with the directives of Prime Minister and approved procedure by the Board of Directors. It was he to keep eye over the acts of Board of Directors and not to allow them to deviate from the laid down procedure, feasibility report and decisions taken in different meetings of the Board of Directors. In most of the meetings of Board of Directors he has been attending not only here in Pakistan but even in London. He has been advising the Board of Directors on many occasions in the interest of Corporation but lastly when the purchase of ships was being finalized he was aware of the fact that exemption in customs and regulatory duty has not been allowed by the Government of Pakistan or CBR, as such, proposed ships which were going to be purchased could not enter into Pakistani waters and PNSC would not be able to take benefit of induction of these ships into PNSC fleet and resultantly PNSC would suffer heavy loss. It was, therefore, his duty to prevent such deal of acquisition of ships when he was specially assigned this duty by the then Prime Minister. The word 'over-seein the letter Ex.10/8 does not convey that hands of accused Mansoorul Haq were tied up and he was not to say anything to the Board of Directors in the interest of PNSC. Here, it will be seen that accused Mansoorul Haq has been taking interest in the acquisition programme from very beginning when he was Chairman PNSC and for this purpose he was required to oversee the entire programme and on his suggestion and wishes the. Prime Minister had issued such directives, but it appears that he by misusing his authority, strongly recommended the case to the Prime Minister through Ahmed Sadiq, as is evident from letter Ex.10/15 instead of preventing the deal/purchase of ships for which approval was sought by the Chairman PNSC. It will be pertinent to mention here that there was no urgency to purchase those container ships which could not enter Pakistani waters and were already chartered. It was not necessary that an amount of 50.00 million US$ must have been invested without any benefit or advantage to the PNSC. As a part of duty, in view of Ex.10/8 accused Mansoorul Haq should have killed the deal or postponed till exemption was allowed by the Government in customs and regulatory duty. He should not have allowed the Chairman PNSC to proceed farther. It amounts that he had no objection to the purchase of 3 container ships in the circumstances as discussed above and wanted Chairman, PNSC to finalize the deal without seeking exemption in customs and regulatory duty and thus he was in league with Chairman and Board of Directors of PNSC. I have perused the evidence adduced by prosecution and the accused persons and scrutinized the same with the help of counsel for the parties. In view of my above discussions and findings given on points, I am of my considered opinion that prosecution has been able to prove the points in hand. Hence points in hand are answered as proved."
16. On the basis of above findings, the learned trial Court decided the Point No,12 in the terms that the prosecution has been able to prove that Commodore Mirza Ashfaq Baig, and Mansoorul Haq committed an offense punishable under Section 9(a)(vi) of the NAB Ordinance, 1999, R/W Schedule attached thereto and were liable to be punished under Section 10 of the NAB Ordinance. They were convicted accordingly and awarded sentences narrated in the earlier part of this judgment.
17. Being aggrieved with the conviction and sentences as above, the appellants have preferred this appeal.
18. We have heard Mr. Azizullah K. Shaikh, assisted by Ms. Shaista Shamim, learned counsel for appellant Commodore Mirza Ashfaq Baig, Mr. Iqtidar Ali Hashmi, learned counsel for appellant Mansoorul Haq and Mr. Muhammad Anwar Tariq, learned DPGA for the NAB/State.
19. The main contention of the learned counsel for the appellants is that the prosecution utterly failed to substantiate and establish the allegations levelled in the reference and in the charge. Mr. Azizullah Shaikh, learned counsel for the appellant Mirza Ashfaq Baig, has submitted that appellant Mirza Ashfaq Baig, initially rejected the proposal for purchase of ship M.'V. Apolonia, without examination of relevant record and subsequently, after examination of relevant record, changed his opinion. He has submitted that the change of opinion on the part of appellant Mirza Ashfaq Baig, was on account of objective consideration. However, the final decision for the purchase of ship was taken by a small Acquisition Committee, on which Mirza Ashfaq Baig was not a member.
He has maintained that the trial Court has absolved both the appellants from the charge of paying exorbitant price much higher than prevailing in the international market and of causing any loss to the exchequer and PNSC. There is not a single word in the entire prosecution evidence alleging any profit or gains on the part of two appellants, before, during or after the transaction of purchase of the three ships and the learned trial Court has not given any finding as to how and in what manner any ulterior motive is established on the part of appellants, by the prosecution. He has vehemently argued that after a specific and categorical finding on the point that neither any exorbitant price was paid for the purchase of ships nor any loss was caused to the exchequer and PNSC and in the absence of any iota of evidence on the point of personal gains on the part of appellants and any ulterior motive, the appellants were entitled to be acquitted of the charge.
20. Mr. I. A. Hashmi, learned counsel for the appellant Mansoorul Haq, has also reiterated the contentions raised by Mr. Azizullah Shaikh and has further submitted that appellant Mansoorul Haq being Principal Technical Advisor for Maritime Affairs to the Government of Pakistan, has merely performed his duty for strengthening the feeble maritime fleet of Pakistan as compared to the neighbouring countries and in this behalf has overseen the operation without acquiring any personal gains or benefits and without any ulterior motive. He has further submitted that the finding of the trial Court has attained finality on the points that no exorbitant price for the purchase of ships was paid and no loss was caused to the exchequer and PNSC. The loss referred to in the reference and the charge is operational loss for the period between 1996 and 2000, for which the appellant Mansoorul Haq is not responsible at all. He has further submitted that no loss has been caused to PNSC, by induction of the ships in the fleet of PNSC without getting extension of exemption form CBR for payment of customs duty and taxes. He has maintained that the prosecution witnesses have admitted that the three ships under consideration never entered the domestic water of Pakistan and remained in the international waters till the exemption from the payment of taxes and duties were allowed by the CBR. During this period all the three ships were chartered and were being run on profit which were used for the payment of loan which was taken from the National Bank of Pakistan, for the purchase of ships. Both the learned advocates for the appellants have forcefully argued that the learned trial Court has convicted the appellant for the offence punishable under Section 9(a)(vi) of the NAB Ordinance, 1999, without adverting to the fact that the necessary ingredients of the offence under above provision were not fulfilled. They have submitted that the conviction awarded by the trial Court is violative and destructive of its own findings in the impugned judgment to the effect that neither any exorbitant price was paid for the purchase of three ships under consideration nor any loss was caused to the exchequer and PNSC.
They have further argued that mere irregularity if any, mistake or administrative lapse on the part of public servants in execution of policy matters or implementation of a policy decision does not constitute an offence per se until and unless it is coupled with the intention/purpose of deriving any benefit/gain by such public servant directly or indirectly or to any other person. Likewise any act or omission which does not result into any loss of public money or does not result into any undue benefit or favour shall not amount to the commission of an offence under Section 9(a)(vi) of the NAB Ordinance.
21. On the other hand, Mr. Muhammad Anwer Tariq learned DPGA, has supported the impugned conviction and sentence. He has however, frankly stated that the learned trial Court has given an unequivocal and categorical finding to the effect that neither any exorbitant price was paid for the purchase of 3 ships under consideration nor any loss was caused to the exchequer or PNSC on account of purchase of these ships. On being confronted by the Court with the evidence on record he frankly stated that according to the Investigating Officer and other prosecution witnesses, the loss referred to in the reference and charge is an operational loss for which the appellants are not responsible and no evidence has been brought on record to substantiate the allegation of causing any loss to the exchequer by the appellants. When called upon to show any evidence on the record to the effect that the appellants gained any benefit or favour for themselves or any other person, the learned DPGA had no option but to concede that there was no such evidence on record. He however, submitted that the appellant Mansoorul Haq was instrumental in getting the 3 ships purchased and in doing so, he did not exercise his authority for preventing the Board of Directors of PNSC from deviating from the policy laid down by ECC for the purchase of ships and likewise appellant Commodore Mirza Ashfaq Baig, wilfully failed to exercise his authority to prevent the purchase of ship M.V. ApoIonia, which he could have done by sticking to his earlier opinion rejecting the ship. He was specifically asked to show from the impugned judgment of the trial Court as to what were the findings forming basis for the impugned conviction and sentence. The learned DPGA, took us through the, impugned judgment and contended that so far, the points pertaining to exorbitant payment of price and causing of loss to exchequer and PNSC, are concerned, they have been decided against the prosecution and in favour of appellants. He however, submitted that the learned trial Court awarded conviction and sentence to the appellant on the basis of findings on the Point Nos.9, 10 and 11. The learned DPGA, was asked to point out findings of trial Court on the point of ulterior motive on the part of appellant Mirza Ashfaq Baig and any favour to the co- accused resulting in advantage to them as envisaged in Point Nos.9 and 10. After going through the entire impugned judgment and the prosecution evidence, he submitted that neither there is any finding of the trial Court nor there is any evidence on record to show that the alleged misuse of authority on the part of appellant Mirza Ashfaq Baig, resulted in any favour or personal advantage to any accused or any other person and that any omission on the part of appellant Mansoorul Haq resulted in favour or advantage to any accused or any other person.
22. We have very carefully considered the contentions raised by the learned advocates for the parties and have assessed the entire material available on record. We are of the considered opinion that in view of very specific and categorical finding on the part of the trial Court that no exorbitant price was paid for the purchase of 3 ships under consideration and no loss was caused to the exchequer or PNSC on account of the purchase transaction of the ships and in the absence of any finding of the trial Court on the point of ulterior motive resulting in any benefit, advantage, gain or favour to accused or any other person, we need not to dwell on the findings of facts. The only point requiring our consideration is, whether a mere deviation from any policy decision or any mistake, lapse or irregularity in execution of any decision or policy matter or a transaction or in execution of a project is an administrative lapse calling for disciplinary action only by the competent administrative authority or it amounts to commission of an offence under Section 9(a)
(vi) of the NAB Ordinance.
23. It would be appropriate to reproduce the provision contained in Section 9(a)(vi) of the NAB Ordinance, 1999. Which reads as follows:-- "9. Corruption and Corrupt 'Practices:
(a) A holder of a public office, or any other person, is said to commit or to have committed the offence of corruption and corrupt practices-
(i) ...............................
(ii) .......................
(iii) ............
(iv)....................................
(v) ..................
(vi) if he misuses his authority as to gain any benefit or favour for himself or any other person, or renders or attempts to render or wilfully fails to exercise his authority to prevent the grant, or rendition of any undue benefit or favour which he could have prevented by exercising his authority;
(vii) ..
(viii)
(ix)
(x)
(xi)
(xii).............................
24. A perusal of the above provision shows that following are the ingredients, constituting offence under this provision:-
(a) A holder of a public office, or any other person misuses the authority;
(b) so as to gain any benefit or favour for himself or any other person;
(c) renders or attempts to render or wilfully fails to exercise his authority;
(d) to prevent the grant of rendition of any undue benefit or favour which he could have prevented by exercising his authority. The language of the provision is very clear and free from any ambiguity. The first ingredient is the misuse of authority. However, it is not unqualified which is indicated from the use of expressions immediately following, "so as to gain any benefit or favour for himself or any other person". Thus, the misuse of authority simpliciter, may entail to a disciplinary action under the respective efficiency and disciplinary rules by way of an administrative/executive action but shall not constitute an offence under Section 9(a)(vi) of the NAB Ordinance, until unless the misuse of authority is with intention/purpose to gain any benefit or favour for himself or any other person or is directed in this behalf. Here we will hasten to add that it is not necessary that the misuse of authority should necessarily result into gain, benefit or favour for the person exercising the authority or any other person but it would amount to an offence even, if the misuse of authority is rendered or there is an attempt to render towards the gain, benefit or favour. This intention is manifested with the use of words "render or attempt to render". Now we come to the second part of the subsection which provides that if a person wilfully fails to exercise its authority to prevent the grant rendition of any undue benefit or favour, which he could have prevered by exercising his authority, it would amount to commit corruption and corrupt practices. It means that in the second part also mere inaction or failure to exercise the authority in deviation or even violation any administrative policy decision instructions, rules or regulations.Per se would not be a criminal offence under this provision but shall become so if the failure or inaction on the part of any person results into rendition of any undue benefit or favour which that person could have prevented by exercising his authority or any grant could have been prevented but was not so prevented for want of action on the part of the person concerned and on account of omission of exercise of authority.
There are two parts of the provision contained in Section 9(a)(vi) of the NAB Ordinance. First, resulting from an action on the part of holder of public office or any other person and, second, on account of omission on the part of such person, the sine qua non, is that such action is with the intention/purpose and in direction towards any gain, benefit or favour for such person or any other person and rendering of misuse of authority or an attempt to render the misuse of authority is necessarily towards the gain, benefit or favour for the person exercising authority or any other person. Likewise the omission, failures or inaction in exercise of the authority should such that in the event of exercise of authority, the grant or rendition of any undue benefit or favour could have been prevented. Thus, the intention of Legislature is very clear that in order to constitute an offence under Section 9(a)(vi) of the NAB Ordinance, the necessary ingredient is the intention or purpose to gain any benefit or favour for such person or any other person and the inaction/omission is also in the same direction.
25. Although the preamble of a statute is not the substantive pari of the statute but by now it is accepted principle of interpretation of statutes that for ascertaining the intention of Legislature the Courts can look into The preamble of a statute. A perusal of the preamble to NAB Ordinance, 1999, shows that it was found expedient and necessary to provide for effective measures for the detection, investigation, prosecution and speedy disposal of cases ,involving corruption, corrupt practices, misuse or abuse of power or authority, misappropriation of property, taking of kickbacks, commissions and for matters connected and ancillary or incidental thereto and a grave and urgent need was there for the recovery of State money and other assets from those persons who have mis-appropriated or removed such money or assets through corruption, corrupt practices and misuse of power or authority. In this background and for achieving these objects and purposes the NAB Ordinance, was promulgated. We are of the considered opinion that the main purpose of inacting NAB Ordinance, 1999, was to provide effective measures for preventing amassing of wealth by the holders of public offices or any other person by corrupt and illegal means, misuse or abuse of power or authority, misappropriation of property, taking of kickbacks commissions and for other matters connected, ancillary or incidental there Thus, if there is any act or omission on the part of holder of a Public office or any other person which merely falls within the preview of misconduct or dereliction of duty entailing a disciplinary action, or is in the nature of civil wrong and is not coupled with the intention or purpose to gain any benefit or favour for himself or any other person and likewise if there is omission or inaction resulting in the grant or rendition of any undue benefit or favour which could have been prevented by exercise of authority then only it shall amount to the commission of offence under Section 9(a)(vi) of the NAB Ordinance.
26. A similar question came for consideration before a Division Bench of this Court, in the case of Muhammad Siddiqe-ul-Farooq v. The State PLD 2002 Karachi 24. One of us (Muhammad Mujeebullah Siddiqui, J) while examining the issue held as follows: "Almost all the appointments made by the appellant appear to be on merit, and offering reasonable salary, in accordance with the policy already in existence prior to his appointment as M.D., H.B.F.C, in the interest of day to day working of the Institution, against the existing vacancies and all the appointments were approved even after the arrest of appellant and during the present Government, therefore, we are of the opinion that the prosecution has utterly failed to establish that the appellant made any appointment to gain benefit or favour for himself or any other persona The prosecution has not been able to bring any material to show that the appellant appointed any of his relatives or near and dear ones during his tenure. The prosecution has further failed to prove the charge that any wrongful loss was caused to the Government exchequer with the appointments made by the appellant on contractual/daily wages appointments. It is also to be kept in view that a head of the department or an Institution, may sometimes exceed his normal administrative powers in the interest of Institution and under some wrong impression about his authority on the basis of a practice in vogue or on account of a policy framed by the predecessors and continuance thereof without any objection more particularly when it is in the interest of smooth working of the Institution. Every such irregularity is not to be treated as misuse of authority and more particularly is not to be treated as criminal offence. It is established principle of the criminal administration of justice that before convicting any person the prosecution is required to establish beyond any reasonable doubt, all the ingredients constituting an offence and if there is any lacuna, infirmity or doubt it has always to be resolved in favour of an accused person. Coming to the facts of the present case we find that the prosecution has at the most established some irregularity in making appointments by not taking prior approval of the Finance Division.
However, the offence under section 9(a)(vi) shall be made out if a holder of a public office, misuses his authority, so as to gain any benefit or favour for himself or any other person. Mere irregular use of authority may attract disciplinary action under the Service Rules. But in order to establish the offence of corruption and corrupt practices, mere irregularity on the part of holder of a public office or any other person is not sufficient. The prosecution must establish misuse of authority coupled with the intention to gain any benefit or favour for himself or any other person or to render or attempt to do so. Here, we are not dilating on the latter part of the definition given in section 9(a)
(vi) of the N.A.B. Ordinance, because the first part only is relevant for the purpose of the matter before us. It is also established principle of the criminal administration of justice that if there are more than one ingredients for constituting a criminal offence, all of them are to be established any if any one or more ingredients are not established then and accused person cannot be convicted for the commission of offence merely on committing one part of the act which in itself does not constitute the totality of act amounting to an offence."
27. The same principle was reiterated in the case of Akhtar Hassan Ansari v. The State. 2003, PCr.LJ 473 (Kar.) in the following words:-- "The perusal of material placed on record shows that the allegations against the applicantiaccused is that he misused his authority. There is nothing on record from which it could he said that the applicant/accused himself dishonestly and fraudulently in collusion with other" accused derived benefit or pecuniary advantage or allowed the others to do so by misusing his lawful authority and committed offences of corruption and corrupt practices by causing loss to public exchequer with motivation to favour any person, or made any grant, concession or caused benefit to any person or his relative as defined in section 9 of the NAB Ordinance."
28. Similar view has been taken by three Division Benches of the Lahore High Court in the following cases:-
(i) Dr. Farooq Sattar v. The State, PLD 2002 Lahore 95.
(ii) Tariq Javed Afridi v. The State, PLD 2002. Lahore 233.
(iii) M. Anwar Saifullah Khan v. The State PLD 2002 Lahore 458.
29. In the first case, it has been held that the accused persons were not shown to have derived any benefit in the matter of award of a contract and consequently the alleged misuse of authority did not constitute an offence contemplated under Section 9(a)(vi) of the NAB Ordinance.
30. In the second case, it has been held as follows:-- "A person may, in exercise of his authority, go wrong due to some ordinary human failing or error but this, per se, will not be actionable under the law. However, if a person knowingly and deliberately follows a wrong course of action and deviates from the purposes of law and proceeds to achieve some other objective either prohibited or not intended by the law then he becomes liable under the law. Therefore, mere erroneous order or lack of jurisdiction on the part of a public functionary will not amount to an offence under section 9(a)(vi) of the Ordinance. However, if a public functionary deliberately uses or exercises his own authority or for that matter usurps the powers of another public functionary with the objective of gaining any benefit or advantage for himself or for any other person then he will be guilty of an offence under section 9(a)(vi) of the Ordinance. It is true that mens rea is a necessary constituent for every penal offence except those of strict liability.
31. In the third case, the following question was formulated for consideration:-- "Whether every erroneous order or mistake of law would tantamount to misuse of authority within the mischief of section 9(a)(vi) of the NAB Ordinance, 1999?"
32. Reliance was placed in this case on the judgments in the case of Tariq Javed (supra) and Siddique-ul-Farooq (supra) and it was held as follows:-- "19. Coming to the second question i,e, whether every erroneous order or mistake of civil law would amount to misuse of authority, it has to be kept in mind that the Reference filed against the appellant did not seek judicial review of the appointments made. It was filed under a Penal statute and the prosecution had to prove the charges framed.
2. Misuse of authority means the use of authority or power in a manner contrary to law or reflects an unreasonable departure from known precedents or custom. Every misuse of authority is not culpable. To establish the charge of misuse of authority, the prosecution has to establish the two essential ingredients of the alleged crime i,e, "mens rea" and `actus reus". If either of these is missing, no offence is made out. Mens rea or guilty mind, in context of misuse of authority, would require that the accused had the knowledge that he had no authority to act in the manner he acted or that it was against law or practice in vogue but despite that he issued the instruction or passed the order. In the instant case the documentary evidence led by the prosecution and its own witnesses admit that the appellant was told that he had the authority to relax the rules and the competent authority P.W.3 could make the appointments thereafter. The guilty intent or mens rea is missing. Even the actus reus is doubtful because he had not made the appointments. He merely approved the proposal and sent the matter to the competent authority. At worst he could be accused of mistake of civil law, i,e, ignorance of rules. But a mistake of civil law negates mens rea."
33. Reverting back to the facts of the present case and examination thereof on the touchstone of the exposition of legal position as discussed above, we find that there is no iota of evidence on record to show that any exorbitant price was paid for the purchase of the three ships thereby causing any loss to the exchequer or PNSC. It is established on record that no loss of any nature was caused as a result of the purchase transaction. There is nothing on the record to show that any favour was done to anybody or was attempted to be done to anybody for the purpose of any gain or benefit or any attempt was made or rendered in this direction by the two appellants and consequently it is held that the learned trial Court while rightly holding that no exorbitant price was paid for the purchase of three ships and no loss was caused by the appellants to the exchequer and PNSC, has misdirected in holding that the prosecution has succeeded in bringing home the guilt to the appellants for the commission of offence under section 9(a)(vi) of the NAB Ordinance.
In the absence of any evidence and finding on the point of any gain, benefit or favour or any attempt in this behalf to the appellants or any other person, the impugned finding of the trial Court is not sustainable which is hereby set aside. Consequently the impugned conviction and sentence are also set aside. Both the appellants are acquitted.
34. On 4-3-2004, the learned advocates for the parties concluded their arguments and the appeal was allowed by a short order as follows:-- "Having heard the defence counsel and the learned DPGA for NAB having assessed the entire evidence in detail, we have reached a definite conclusion that the prosecution has failed to prove the charge against both the appellants. Resultantly by this short order, we allow the appeals of both appellants and acquit them in the Case/Reference. They shall be released forthwith if not required to be detained in any other case."
These are the detailed reasons in support of the short order dated 4-3-2004. The appeals are allowed.