Nawaz Sharif & alleged corruption  

Huzaima Bukhari & Dr. Ikramul Haq

From life-time disqualification of Muhammad Nawaz Sharif—first time of any prime minister in Pakistan under Article 62(1)(f) of the Constitution—to sentence in criminal cases involving alleged corruption and finally permission to travel abroad for medical treatment, there are many lessons for the rich and mighty, who have been claiming that “we are above law or courts are not giving us justice”. The myth that “rich are above the law in Pakistan” was busted on July 6, 2018 by a 174-page comprehensive judgement delivered by Judge, Accountability Court No. 1, Islamabad, in Reference No. 20 of 2017 (Avenfield Apartments No. 16, 16a, 17 & 17a) and later in judgement dated 24.12.2018 in Reference No.19/2017. The most important and significant aspect of these judgements is that intentional/willful withholding of information/documents and misrepresenting/concealing the facts could not help avoid punishment for a criminal act falling in the definition of “corrupt practices” within the ambit of National Accountability Ordinance, 1999 [NAO, 1999].

The adverse comments on the judgement declaring it “weak”, full of “legal lacunae” and even “against the law” by supporters of Nawaz Sharif and some persons posing as “independent analysts” lack objectivity as well as basic understanding of the relevant law under which punishments were awarded to Muhammad Nawaz Sharif and other accused. The most important part of the judgement in Reference No. 20 of 2017 is as under:

“The case has a different set of facts, therefore, it is distinguishable from usual cases of assets beyond sources. The accused had also not appeared before NAB where a proforma would have been given to them for the purposes of showing income, assets and property.”

The judgement specifically notes that the accused deliberately did not cooperate with NAB (National Accountability Bureau) before the filing of reference. The same attitude was demonstrated by them during the 10-month trial before the Accountability Court and earlier before the Joint Investigation Team (JIT) and even before the Supreme Court of Pakistan. This deplorable act was noted with dismay by the Supreme Court in its judgement of April 20, 2017 [2017 PLD 265] that Nawaz Sharif and family members did not come with clean hands and intentionally concealed the relevant documents (real ownership of offshore companies), making contradictory statements (in various interviews and even on the floor of National Assembly by Nawaz Sharif and in his official addresses to the nation). This annoyed the honourable judges who made the following observations:

Per Justice Asif Saeed Khan Khosa as he was then[para78]:

 “Although it had specifically and repeatedly been said by respondent No. 1 on the floor of the National Assembly in the above mentioned speech that the entire record relevant to the setting up and sale of the factories in Dubai and Jeddah was available and would be produced whenever required yet when this Court required Mr. Salman Aslam Butt, Sr. ASC, the then learned counsel for respondent No. 1, on December 07, 2016 to produce or show the said record he simply stated that no such record existed or was available and that the statement made by respondent No. 1 in the National Assembly in that respect was merely a “political statement”!

………………………………………………..

In one of his interviews with Mr. Javed Chaudhry on Express News television on March 07, 2016 Mr. Hussain Nawaz Sharif, respondent No. 7, had also categorically maintained that the entire record pertaining to acquisition of the four properties in London was available with the family and the same would be produced before any court looking into the matter. Such state of affairs has been found by me to be nothing but shocking as it tends to be an attempt to suppress the relevant facts and the truth and to mislead the Court. Mr. Haroon Pasha and Mr. Hussain Nawaz Sharif have never denied or contradicted the contents of the above mentioned interviews.

[underlined by us for emphasis]

In his judgement [Para 83], the honourable Justice Asif Saeed Khan Khosa as he was then reproduced a chart highlighting “the serious contradictions in the stands taken by respondent No. 1 and his immediate family from time to time in the matter of acquisition of the relevant four properties in London” and noted that such “contradictions may reflect upon their lack of honesty on the issue”.

Per Justice Gulzar Ahmed [para 11]:

This anomaly of increase in the number of shares of the two companies is not explained. Further, I find that the Bearer Share Certificates of the two companies separately mentioned authorized capital of each of the company to be US$ 50,000 divided into 50,000 shares of par value US $ 1 each. No record is made available on the basis of which it can be ascertained as to what number of shares in each of the company were issued either bearer or registered. The Bearer Share Certificate of Nescoll Limited is dated 29.04.1993 while that of Nielsen Enterprises Limited is dated 22.01.1994 Mian Muhammad Nawaz Sharif and his family does not claim that these Bearer Share Certificates were in their custody from their respective dates.

He when called upon by the highest Court of the country to explain, what Mian Muhammad Nawaz Sharif chose was to remain silent and gave bare statement that he is not owner of the four London Flats and of the two offshore companies. This evasive attitude of Mian Muhammad Nawaz Sharif, more so before the highest Court of the country, to me, did not appear to be justified or bonafide rather its purpose appears to throw the Court in altogether a dark alley where it is left groping without realizing that this very act of his will cast a substantial shadow upon him, more so when the Court is considering the very question of his being Honest and Ameen in holding office of the Member of National Assembly and the Prime Minister of Pakistan.

[underlined by us for emphasis]

Per Justice Sh. Azmat Saeed[para 69, 72 & 80]:

In the circumstances, it is clear and obvious that the person, who instructed M/s. Minerva Nominees Limited and M/s. Minerva Services Limited in 2006 and M/s. Trustee Service Corporation in June 2014 to provide services for the two companies M/s. Nielsen Enterprises Limited and Nescoll Limited, is the real beneficial owner of two companies. The said documents were not provided. This aspect of the matter was pointed out to the learned counsel for the Respondents, more particularly, Respondent No.7.

There is no document available on the record in favour of Respondent No.7 Hussain Nawaz to show that he (Respondent No.7) is a shareholder i.e. owner of the two BVI Companies. The Trust Deed dated 2nd/4th June, 2006 is not the evidence of Respondent No.7’s title. It pre-supposes that the shares vest in Respondent No.7 Hussain Nawaz Sharif and, at best, is an admission in one’s own favour, which is legally irrelevant.

 “A clear cut explanation for the title thereof and all the obvious documents in support thereof should be in the custody of the private Respondent, who claims to be the owner. Such documents have been deliberately withheld from this Court. The Flats have been in occupation of the Sharif Family since early 90s through Respondent No.8, who was a student and was a dependent upon Respondent No.1 at that point of time. The alleged source of funds through which the various properties were acquired is shrouded in mystery and no clear cut transparent transactions have been shown. Respondent No.1 has admittedly benefitted from such assets, including Hill Metal Establishment through various “gifts” totaling an amount of Rs. 84 corers as is mentioned in CMA No.432 of 2017”.

[underlined by us for emphasis]

Per Justice Ijaz Ul Ahsan[para 36 & 39]:

The total liability of Gulf Steel was about 36,023,899.31 Dirhams. According to the terms of the agreement, the entire sale price for the 75% shareholding was received by BCCI towards part payment of amounts owed to it by Gulf Steel. There is no explanation available on record and none has been offered despite repeated queries by us as to whether the balance outstanding amounts which were admittedly owed by Gulf Steel or its shareholders/partners to BCCI and other creditors were paid and if so by whom and from what source(s). There has either been complete silence or evasive responses on the part of the Respondents claiming lack of information/documentation/record to answer this question or fill these material gaps in the information.

We have found it strange that while all other transactions including setting up of Gulf Steel, obtaining financing for it, repayment of dues of BCCI, furnishing of guarantees stipulated in the Tripartite Agreement, etc. were undertaken by involvement of Banks/Financial Institutions, the entire alleged transaction related to investment of 12 Million Dirhams in Qatar is claimed to have been undertaken through cash transactions without documentation of any nature being executed by the parties evidencing such transaction(s). There is not a shred of evidence showing the terms and conditions on the basis of which this sum of 12 Million Dirhams was invested in the real estate business of the Thani Family. Late Mian Muhammad Sharif was a seasoned businessman of long standing. We find it hard to believe that he instructed Mr. Tariq Shafi to handover 12 Million Dirhams in cash to Sheikh Fahad for investment in his father’s business without any documentation whatsoever.

[underlined by us for emphasis]

In the aftermath of submission of report by JIT came the unanimous judgement [2017 PLD 692] of the five-member bench of the Supreme Court asking for filing of reference against Nawaz Sharif, offspring and son-in-law. The decision by Judge Muhammad Bashir in Reference No. 20 of 2017 also clearly establishes withholding of evidence (available with Nawaz Sharif and family) regarding possession and ownership of the four Avenfield apartments. Those criticising the judgement, many without reading and having no training in the discipline of law, must first read section 5(c) of the NAO, 1999, which defines the term ‘assets’ as under:

“Assets” means any property owned, controlled by or belonging to any accused, whether directly or indirectly, or held benami in the name of his spouse or relatives or associates, whether within or outside Pakistan which he cannot reasonably account for, or for which he cannot prove payment of full and lawful consideration.   

The case was for assets held indirectly through offshore companies and onus was on the accused to produce documents of purchase through bona fide funds. The critics of the judgement must be reminded that the matter could have ended even before the investigation was referred to JIT/NAB had Nawaz Sharif and family discharged the onus.

In the majority judgement (two honourable judges siding with then Justice Ejaz Afzal Khan) ,reported as 2017 PLD 265, Supreme Court gave another chance to Nawaz and family to prove their case before JIT but they miserable failed to do so and the same thing happened before the Accountability Court as noted in the judgement of July 6, 2016.

It is pertinent to mention that in the first round of litigation, the five members could have decided the matter themselves after giving categorical findings of concealing the facts and deliberate withholding of evidence by Nawaz and family. They intentionally avoided resorting to Article 129(g) of Qanoon-e-Shahadat Order. Had they done so, Nawaz and supporters could have taken the plea that right to appeal was not available under Article 184(3) of the Constitution and Article 10A was violated. Now, they have right to appeal and the order of the Judge Muhammad Bashir is open to all kinds of objections, legal as well as factual. Therefore, Nawaz Sharif and family and PMLN cannot claim that in their case injustice was committed. On the contrary, many believe that they have been given extraordinary concessions that have never been extended to other accused facing similar charges of corruption under the law.  

The judgement by the Accountability Court aptly holds that “heavy burden was shifted” to the former premier as all four ingredients were established”: (a) holding public offices, (b) nature and extent of his pecuniary resources or properties (c) his sources of income known after thorough investigation and (d) his resources or properties being disproportionate to his known sources of income. The judgement mentions that Nawaz Sharif was a public office holder, remained Punjab chief minister, finance minister, prime minister and member of National Assembly, and the London properties were purchased through offshore companies Nielson and Nescoll during the years 1993, 1995 and 1996.

The judgement notes that the prosecution in the circumstances of the case and evidence produced reasonably established that “Avenfield flats were not purchased from sources of income shown by the accused……The prosecution had succeeded to bring home the guilt of the accused….. The guilt of the accused Nawaz Sharif u/s 9(a)(v) NAO 1999 read with Serial No.2 of the Schedule attached with the said Ordinance is punishable under section 10 of NAO….Nawaz Sharif is hereby convicted and sentenced to rigorous imprisonment for a term of ten years with a fine of 8 million pounds…..Nawaz Sharif is also convicted under Schedule offence for one year and both the sentences would run concurrently”.

As wrongly projected in the Press, it was never a case of section 9(a)(iv) of NAO 1999 that reads as under:

“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:

“if he by corrupt, dishonest, or illegal means, obtains or seeks to obtain for himself, or for his spouse or dependents or any other person, any property, valuable thing, or pecuniary advantage”.

This was a case section 9(a)(v) of NAO 1999 that reads as under:

“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:

“if he or any of his dependents or benamidar owns, possesses, or has acquired right or title in any “assets or holds irrevocable power of attorney in respect of any assets or pecuniary resources disproportionate to his known sources of income, which he cannot reasonably] account for or maintains a standard of living beyond that which is commensurate with his sources of income.

Keeping in view the definition of term ‘assets’ under section 5(c) of the NAO, 1999, the charge was that Avenfield apartments were created from unexplained resources and ownership was disguised under offshore companies. If the hands of Nawaz Sharif and family were clean why did they not produce the sources and mode of payment for acquiring the flats? One the one hand, Nawaz Sharif publicly claimed that flats were purchased from sale of mills established by his late father and on the other could not give simple money trail. Condemning conviction under 9(a)(v) and celebrating acquittal under section 9(a)(iv) of NAO, 1999 shows how naïve Nawaz Sharif and his supporters are!  

The judgement of the Accountability Court in Reference No. 20 of 2017 is sound in law. The real issue in appeal would remain the same—the deliberate withholding of information and its effect. The Lahore High Court in RSA No. 108 of 2006 [Manzoor Hussain v Haji Khushi Muhammad] held that:

This omission was fatal to the case of the appellant as it is a settled principle of law that if a best piece of evidence is withheld by a party, then it is to be presumed that said party had some sinister motive behind it and a presumption under illustration (g) of Art. 129 of the Qanun-e-Shahadat, 1984 has to be drawn that the said evidence if produced, it would have not been favourable to the party concerned [See Muhammad Rafique, etc. vs. State & others (PLJ 2011 SC 191)].

[underlined by us for emphasis]

Illustration of Article 129(g) squarely applies to the Avenfield Case. It reads as under:

“129. Court may presume existence of certain facts. The Court may presume the existence of any fact which it thinks likely to have happened, regard being had to the common course to natural events, human conduct and public and private business, in their relation to the facts of the particular case.

Illustrations

The Court may presume—

…………………………..

…………………………

(g) that evidence which could be and is not produced would, if produced, be unfavourable to the person who withholds it;

as to illustration (g). A man refuses to produce a document which would bear on a contract of small importance on which he is used, but which might also injure the feelings and reputation of his family”………;

Taking cognizance of Article 129(g) Qanoon-e-Shahadat Order, 1984 and above cited case law, Mian Muhammad Nawaz Sharif and his family could not escape adverse order in the Avenfield Case [Reference No. 20 of 2017]. They could not take benefit of their own wrongdoings. In appeal as well, Nawaz Sharif and family have a weak case though judgement is suspended and he is allowed to proceed abroad on humanitarian ground despite conviction in Reference No.19/2017, which was not suspended by any court and appeal is pending. Everybody prays for his early and complete recovery. He is entitled to medical treatment of his choice and unfortunately during his three rules and that of his younger brother in Punjab, not a single hospital was established that can cater for ailments suffered by Muhammad Nawaz Sharif.

The conviction in Reference No.19/2017 [Azizia Steel Company Ltd. Jeddah K.S.A, Hill Metals Establishment, Jeddah K.S.A & Remittances] entailing seven year imprisonment along with a fine of, Rs. 1.5 billion and US $ 25 million is also significant though conduct of judge had been highly inappropriate as later on emerged from his statement, videos etc. Who approached the judge and who offered him concessions and/or threats for dire consequences still shrouded in mystery? These allegations need proper probe so that real culprits are taken to task.

The following part of judgement in Reference No.19/2017 is worth mentioning:

It is manifest from the record that accused Mian Muhammad Nawaz Sharif at initial stage in his address to the nation and speech on the floor of National Assembly, attempted to vindicate his and his immediate family members position by adopting a stance similar to that put forth by his sons regarding the source of income with which assets held abroad were created. Similar position remained prevalent till the matter was taken up by the august Supreme Court Pakistan. However, given the sharp reaction against this version, he started distancing himself from the line of defence advanced in the CMAs and Concise Statements. After his disqualification by the Honourable Supreme Court and initiation of investigation by NAB, in view of the continued failure to provide the money trial and documentation he himself had claimed to the nation were all available, a different stratagem was adopted to avoid liability. This entailed keeping the two sons away from this trial and claiming that he himself had little, if any, personal knowledge of the matters pertaining to the source of wealth which was used to set up, inter alia, GSM, ASCL and I-RvE. Perusal of file goes on to show that the Accused No. 1 in, reply to questions in his statement under section 342 Cr.P.C endorsed the stance taken by accused Hussain Nawaz Sharif with reference the ASCL and HME. The foregoing, considered cumulatively, betrays a sinister and guilty mind. The claim of ignorance on part of the Accused No. 1 and disassociation from the version of his sons with regard to material facts is a mere ruse and subterfuge.

Mian Muhammad Nawaz Sharif could not be given benefit of doubt after deliberately withholding crucial evidence which was in his possession or with other accused about which the following observations were made in the judgement dated 24.12.2018 in Reference No.19/2017:

Two accused namely Hassan Nawaz Sharif and Hussain Nawaz Sharif are absconding and have already been declared as proclaimed offenders. Perpetual non bailable warrants of arrest be issued against them directing the NAB authorities to enter their names in the relevant register of POs under intimation to this court. Reference file with all of its documents, evidence and material be kept intact, till the absconding accused Hassan Nawaz Sharif and Hussain Nawaz Sharif appeared or arrested and brought before the Court to face the trial. File, till then, be consigned to record room after completion and compilation.

It is pertinent to mention that even under section 111 of the Income Tax Ordinance, 2001, the taxation officer gives a chance to the taxpayer to explain the source of investment/property/expenditure and if he/she/it fails to do so the entire value/amount is treated as his/her/its unexplained income. It is not the legal obligation of the taxation officer to first establish the sources and then make the addition. Once a person accepts ownership of an asset then onus lies on him/her to explain its source of acquisition. If acquisition is from unexplained source, then penal action is to be taken without any exception. Strangely, this simple principle is not being admitted by the defenders of Nawaz Sharif, who are misreading and misconstruing the judgements of June 6, 2018 and December 24, 2018 delivered by the Accountability Courts to intentionally mislead the masses.

______________________________________________________________

The writers, lawyers and partners in Huzaima, Ikram & Ijaz, are Adjunct Faculty at Lahore University of Management Sciences (LUMS)