THE HIGH COURT OF SINDH AT KARACHI

Criminal Accountability Appeal No. 12 of 2010

Present: Mr. Justice Naimatullah Phulpoto

Mr. Justice Abdul Mobeen Lakho

Appellant : Peer Deedar Ahmed Sarhandi through Mr. Ghulam Sarwar Chandio advocate

Respondent : The NAB through Mr. Shahbaz Sahotra Special Prosecutor NAB

Date of Hearing : 27.10.2021

Date of decision : 29.10.2021

JUDGMENT

NAIMATULLAH PHULPOTO, J. Peer Deedar Ahmed Sarhandi (since demised) was tried by learned Accountability Court No.1, Sindh at Karachi in Reference No.01/2003. After regular trial, he was found guilty under Sections 9(a)(iii)(iv) and (vi) of the National Accountability Ordinance, 1999, he was sentenced under section 10(a) of the said Ordinance to undergo 14 years R.I and to pay fine of Rs.62.354 Million. In case of default in payment of fine he shall suffer further R.I for five (05) years. His immovable properties were also ordered to be confiscated to the Habib Bank Limited. Deceased appellant was declared disqualified to hold any public office or contest the elections for a period of 10 years. However, benefit of section 382-B Cr.P.C was extended to him.

2. Brief facts of the prosecution case, as mentioned in the impugned judgment dated 26.04.2010 are as under:

“The case of the prosecution as per FIR is that the complainant who is a senior vice president Habib Bank Limited, small finance division, Karachi, states that under the then Prime Minister scheme and to revamp public transport dated 2^nd December 1991 and 3^rd December 1991, the Habib Bank Limited disbursed billions of rupees in the aforesaid scheme and said facility was availed by a number of the borrowers and the 90% of the price of the vehicles popularly known as yellow cab had to invest by the Habib Bank limited and 10% by the borrowers. It is further stated that subsequently a separate division was introduced in the name of vigilance branch whose function was to impound the defaulted vehicles. It is further stated in the FIR that the accused Peer Deedar Ahmed Sarhandi, Assistant vice president was posted as Divisional head of the vigilance cell and accused Sabir Hussain, Assistant Vice president. The accused Peer Deedar Ahmed Sarhandi after impounding of about 57 vehicles released the same without realizing the loan amount unauthorizedly and caused a colossal loss of Rs.2,36,19,416/- as such the accused exercised the powers in abuse of his official powers and committed criminal breach of trust. The case was, therefore, registered and after usual investigation, initially the challan was submitted in the Banking Court (Offences in Banks) at Karachi from where it was transferred on the application of the prosecution u/s 16-A of the Ordinance, 1999.”

3. Learned Accountability Court No. I, Karachi framed charge against deceased appellant/accused and others under the above referred sections at Ex.3, who pleaded not guilty and claimed trial.

4. In order to prove its’ case, the prosecution examined as many as 22 witnesses, who exhibited various documents in support of the prosecution case, where after the prosecution closed its’ side.

5. Trial Court recorded statement of deceased appellant/accused under Section 342 Cr.P.C, in which he denied prosecution allegations and claimed his false implication in this case.

6. Learned trial Court after hearing learned advocate for the deceased appellant, Special Prosecutor NAB and after assessment of the evidence convicted and sentenced the deceased appellant as mentioned above, while co-accused were acquitted mainly for the following reasons:

“After appraisal of the whole oral as well as documentary evidence available on record, I am of the firm opinion that the accused Peer Deedar Ahmed Sarhandi while acting as divisional head of the vigilance team to impound vehicles from defaulting borrowers and disposed off 57 vehicles involved in the present reference by using corrupt practice and misuse of powers vested in him either released the vehicles after receiving money from the customers/ purchasers or after recovery of defaulting installments from the borrowers but did not deposit the same with the respective branches of the bank who disbursed the loan to the borrowers by issuing release orders in writing throughout Pakistan and it has been proved beyond any reasonable doubt that the accused Peer Deedar Ahmed Sarhandi is the main offender and the author who committed the offence of embezzlement as such he by disposal of such vehicles have caused colossal loss of Rs.62.354 million to the Habib bank limited. The evidence against the remaining accused is not sufficient to implicate them in the present crime.

After appraisal of whole evidence available on record I am of the firm opinion that the accused Peer Deedar Ahmed Sarhandi is the accused who is responsible for the present crime and the evidence did not implicate the remaining accused to implicate them in the present crime and is highly doubtful against them as such it brought me to the proposition as to what sentence may be awarded to the accused. The record shows that originally the accused were challaned u/s 409/34 PPC r/w section 5(2) of Act-II, 1947 before the Banking Court (Offences in banks) from where the case was transferred to this court u/s 16-A of the ordinance 1999 and the charge against all the accused was framed u/s 409/34 PPC r/w section 9(a)(iii),(iv) and (vi) of the ordinance 1999. I am oblivious of the fact that in criminal administration of justice if the case has been proceeded in two distinct laws, for the same offence the law which provides the lesser punishment to the accused will be applied against him. In the present case originally the accused has been challaned u/s 409 PPC, before the banking court relating to the offences in banks and the punishment of section 409 PPC is of life imprisonment besides the fine whereas u/s 10 of the Ordinance 1999 the maximum punishment of the ordinance is 14 years with fine as such the law which is providing lesser punishment to the accused is to be followed by this court. The accused Peer Deedar Ahmed Sarhandi is, therefore, convicted and sentenced as follows:

(a) Convict the accused Peer Deedar Ahmed Sarhandi s/o late Nisar Ahmed Sarhandi u/s 10(a) of the ordinance 1999 and sentence him to suffer Rigorous Imprisonment (R.I) for 14 (Fourteen) years and a fine of Rs.62.354 million being the colossal loss caused to the Habib bank limited. In case of default in payment of fine he shall suffer further R.I for five (05) years. His immovable properties are also confiscated to the Habib Bank Limited.

(b) He is also declared disqualified to hold any public office or contest the elections for a period of 10 years.

(c) He shall be entitled to the benefit of section 382-B Cr.P.C.

(d) He is on bail his bail bond stands cancelled. He is taken into custody and is remanded to the prison to serve the sentence in the light of the observation made as above.

(e) Acquit the accused Sabir Hussain s/o Suleman, accused Anwar Hyder Qureshi s/o Ghulam Qadri and accused Muhammad Younus Dalia s/o Muhammad Ismail from the charge u/s 265-H Cr.P.C. They are on bail, their bail bonds stand cancelled.

7. Deceased appellant filed the instant appeal against his conviction and sentence recorded by trial court. Appeal was admitted to regular hearing. However, during pendency of this appeal, appellant expired. Investigation officer NAB submitted his death verification report and proceedings were abated against him. However, we have decided to hear appeal on merits in view dictum laid down by the Honourable Supreme Court of Pakistan in Criminal Petition No. 79-K of 2019 (Sheikh Iqbal Azam Farooqui through his legal heirs vs. The State through Chairman NAB) decided on 02.01.2020, for the reasons that financial liability of the deceased appellant, consequent upon conviction and shifted upon the estate, would certainly require the decision by this Court on its merits as in the event of its failure, the liability is to be exacted from the assets devolving upon the legal heirs. A plain reading of Section 431 Cr.P.C confirms the above contemplation of law.

8. Learned advocate for the deceased appellant mainly contended that prosecution has failed to produce any witness from whom deceased appellant had recovered cash, whose vehicle was sold out; that no documentary evidence has been produced against appellant to prove prosecution case. It is further submitted that co-accused Sabir Hussain, Anwar Haider Qureshi and Muhammad Younus Dalia have been acquitted by the trial court more or less on the same evidence and case of the deceased appellant was on better footing. Lastly, he contended that appellant has expired during pendency of appeal; prosecution has failed to establish its’ case; liability is not to be exacted from the assets devolving upon the legal heirs of the deceased appellant.

9. Learned Special Prosecutor NAB argued that deceased appellant was head of Vigilance Division to revamp public transport under the Prime Minister Scheme of Yellow cab for the purpose of impounding vehicles taken on loan of defaulters borrowers; that prosecution has proved its’ case that deceased appellant had impounded 57 vehicles of defaulters, but later on released the vehicles without receiving any loan from them and in that way caused a loss of Rs.62.354 Million to the HBL; that fact of issuance of release orders was never disputed in the cross-examination. It is further argued that PW-10 Yousuf Hussain produced release order at Ex.17/4 signed by the deceased appellant; that PW-13 Muhammad Azeem worked in the subordination of the deceased appellant confirmed that release orders were issued by the deceased appellant and signatures of the deceased appellant on release orders were not disputed at the time of trial. Special Prosecutor NAB prayed for dismissal of the appeal on merits and submitted that liability is to be exacted from the assets devolved upon the legal heirs of deceased appellant in the circumstances of the case.

10. After re-assessment of evidence, we have come to the conclusion that prosecution has proved its’ case beyond reasonable doubt against the appellant, who expired during pendency of Appeal. Evidence of complainant Anwar Aziz (P.W-01) is very important for just deciding this appeal on merits. He has deposed that he joined Habib Bank Limited as Probationary officer in the year 1965. In the year 1996 he assumed the charge of Small Finance Division of Habib Bank Limited. His duties were to monitor and inform higher ups in office about the small financial activities. On 13.08.1996, he sent an application to FIA in connection with misappropriation in yellow cab finances. He further deposed that he found misappropriation of over 23 million including mark up of 8 million. The principle amount was of Rs.15 million. The misappropriation in yellow cab scheme detected since April 1995 to June 1996 by accused Peer Deedar Ahmed Sarhandi, Sabir Hussain, Muhammad Younus Dalia and other officers of different grades, then employed in Habib Bank Limited. He further stated that under the yellow cab scheme specific instructions were passed on to all the concerned branches of HBL for effective recoveries from the defaulters of the said scheme. In supersession of the aforesaid circulars accused Muhammad Younus Dalia had issued circular No.2 in the months of April 1995 whereby a separate cell was created for effecting recoveries from the defaulters. He further stated that accused Peer Deedar Ahmed Sarhandi the AVP was appointed as Head of the Cell. Accused Peer Deedar Ahmed Sarhandi was re-instated by accused Muhammad Younus Dalia the then President of the bank in the year 1995. As per Circular No.2 of 1995 it was the duty of accused Peer Deedar Ahmed to intercept the defaulting vehicles and effect recoveries of the defaulted amount and also to seize the defaulting vehicles for the purpose of the recoveries of the loans and the amounts thus recovered was required to be deposited in the concerned branch wherefrom the loan was granted for the purchase of the vehicle. Accused Muhammad Younus Dalia had issued circular No.4 of 1995 whereby the status of the vigilance cell was upgraded to a Division. He further stated that accused Peer Deedar was authorized to lookafter all affairs, he was required to report directly to accused Muhammad Younus Dalia. As per his knowledge accused Peer Deedar was terminated from service of the bank in the year 1973, based on resignation. During Martial Law regime, he applied for withdrawal of resignation on the basis that he was victimized, his appeal was rejected by Martial Law authorities. In the mid of 1980’s accused Peer Deedar approached to the Labour court for his reinstatement in service. His such plea was rejected by Labour Court, he thereafter approached appellate labour court where in the year 1992 a decision was passed in his favour. Habib Bank assailed such decision before this Court. Order of appellate labour court was set aside by this Court with direction to deposit all benefits in court. The amount was more than 400,000/-. It is further stated that accused did not deposit the said amount in court. Accused Muhammad Younus Dalia reinstated accused Peer Deedar in service and all the benefits beside Rs.400,000/- were extended in favour of Peer Deedar. On the proposal of HR Division, accused Muhammad Younus Dalia rewarded five promotions to accused Peer Deedar. As per approval, the recovery of Rs.400,000/- from accused Deedar was also waived. He further stated that initially accused Peer Deedar was inducted as cashier later he was promoted to AVP after his reinstatement in service. More than Rs.700,000/- were paid to accused Peer Deedar on his reinstatement as back benefits. One surety furnished by accused Peer Deedar is still outstanding liability against him. Accused Peer Deedar and other who were responsible for the affairs of vigilance division regarding the impounding yellow revamp scheme did not discharge their duties as per rules. As per procedure the vehicles were required to be impounded and in case of default those vehicles were required to be kept in bank godown. He further stated that accused Peer Deedar Ahmed Sarhandi released the vehicles unauthorizedly without realizing the amount, some vehicles were released after realizing the amount which was not deposited in the branches of Habib Bank. The complaint started arising from the loans when the vehicles were impounded and after realizing the amount the same were not released, the loanees wanted their vehicles back. He further deposed that he had received complaints of 29 vehicles including two vehicles of UBL. When he took over the charge, as per reports from different divisions, one thousand impounded vehicles were available with the banks. Accused Deedar Ahmed had released the vehicles unauthorizedly without depositing the recovered amount in HBL which caused colossal loss of Rs.23 million to HBL. Accused Muhammad Younus Dalia served as president HBL upto June 1996, during his regime also complaints were received. Shujaul Hassan took over as president of HBL after accused Muhammad Younus Dalia, he gave instructions to him to investigate into the matter. He further stated that he reported the matter to FIA for investigation. Formal report was lodged in September 1996. He produced letter Ex.8/1, FIR at Ex.8/2 and detailed list of vehicles at Ex.8/3.

11. In cross-examination, he denied the suggestion that he had hatched conspiracy with Shujaul Hassan and other official of the bank for removal of accused Peer Deedar and Muhammad Younus Dalia from services of HBL. He has also denied the suggestion that he had deposed falsely against deceased appellant due to enmity. Other P.Ws namely Muhammad Athar Jamal, Nafees Ahmed Khan, Raeesuddin Ansari, Abdul Saleem, Khalid Hussan Rajpar, Muhammad Amir Saeed, Syed Faizur Rehman, Shakeel Raza, Yousuf Hussain, Muhammad Arif, Shahzad Ahmed Khan, Muhammad Azeem, Rahim Bux Mahar, Ateshamuddin Nazar, Jahangir Ahmed Awan, Muhammad Saleem, Dost Muhammad, Sheikh Irshad Hussain, Ayaz Hussain, Mirza Masood Alam Baig and Gulsher Mugeri, have also fully supported the prosecution case at trial. Evidence of all the P.Ws is consistent on material aspect of the case. No doubt, there are some minor contradictions, which were highlighted by the learned counsel for the deceased appellant, but the same are minor in nature and not material and certainly not such materiality so as to effect the prosecution case and the conviction of the deceased appellant. In this respect reliance is placed on the case of Zakir Khan vs. State (1995 SCMR 1793).

12. Admittedly, deceased appellant was head of Vigilance Cell under the Prime Minister Scheme of yellow cab for the purpose of impounding vehicles obtained on loan of defaulters borrowers. It has come on record that deceased appellant had impounded 57 vehicles of defaulters, but later on released vehicles without receiving any loan from them and in that way caused a loss of Rs.62.354 Million to the HBL. Prosecution examined 22 witnesses in order to substantiate the case. All of them have deposed against deceased appellant at trial. Amir Aziz PW-01 bank official, deposed that he had made complaint to FIA on 13.08.1996 against embezzlement and misappropriation in yellow cab finance scheme and it was duty of the deceased appellant to impound defaulting vehicles and to effect recoveries but deceased appellant misused his authority and without recovering defaulted amount. As regards to the issuance of release orders is concerned, it is matter of record that this fact was not disputed in the cross-examination. All the P.Ws were cross-examined at length but signatures of the deceased appellant were not challenged/disputed by his counsel. Abdul Salam PW-5 had produced release orders before trial court at Ex.12/1 to 12/10. PW-06 Khalid Hussain recognized the signatures of deceased appellant on release orders. P.W-10 Muhammad Yousuf Hussain produced release order at Ex.17/4 signed by deceased appellant. P.W-13 deposed that he had directly worked under deceased appellant. He confirmed the fact that release orders were not issued by deceased appellant.

13. Learned trial Court has rightly appreciated evidence according to settled principles of law and disbelieved defence plea by assigning sound reasons. Therefore, we have no hesitation to hold that conviction and sentence recorded by learned trial Court vide judgment dated 26.04.2010, calls for no interference on merits, but during pendency of appeal, the deceased appellant has expired and his appeal is abated against him. So far fine of Rs.62.354 million is concerned, in terms of Section 431 Cr.P.C, fine is ordered to be recovered as land revenue from assets devolved upon the legal heirs of deceased appellant. Immovable properties of deceased convict have rightly been confiscated by trial court to Habib Bank Limited. We further observe that normally criminal cases and appeals abate after the expiry of an accused but this abatement can affect the case to the extent of the punishment, provided under the sections of law involved in the FIR and the case to that extent will abate but as far as the property, which has also been made a subject matter of reference or the FIR with the allegations of embezzlement, fraud, cheating etc. cannot ipso facto be cleared from the allegations and will not vest clear title on the deceased accused, therefore, his legal heirs too could not be in position to claim the same until the allegation in respect to the property is being disproved. The abetment, after expiry of an accused, can only be in respect to his personal corporeal would be punishments but not in respect to the properties, as such, the properties which are made subject of the reference to involve an accused person in a criminal case or a reference etc. cannot automatically be taken out of the allegations and their status and title is to be considered by the court even after the death of an accused person. Under the references of the NAB, the properties, which are made subject matter of a reference are normally considered public property until vice-virsa held by proper adjudication, therefore, death of an accused cannot do that job. In the present case, deceased appellant faced full-fledged trial and he was found guilty by the learned Accountability Court and his appeal is without merit and appellant has expired during pendency of the appeal. In this respect Honourable Supreme Court has laid down law in the case of Sheikh Iqbal Azam Farooqui through his legal heirs vs. The State through Chairman NAB (Criminal Petition No. 79-K of 2019) decided on 02.01.2020. The relevant portion is reproduced as under:

“4. Corporal consequences of a conviction wither away with the death of the convict, therefore appeal filed by the convict would automatically abate, as the death severs all temporal links with his corpus. However, financial liability, consequent upon conviction and shifted upon the estate, would certainly require the appellate court to decide the appeal on its own merit as in the event of its failure, the liability is to be exacted from the assets devolving upon the legal heirs. A plain reading of Section 431 of the Code ibid confirms the above contemplation of law. Criminal petition is converted into appeal; allowed. The impugned order is set aside. Appeal filed by the deceased, being sustained by his legal heirs, shall be deemed as pending before the High Court for adjudication on merits.”

14. In another case reported as (2019 SCMR 1144) Muhammad Shamoon (deceased) through legal representatives vs. The State and another, the Honourable Supreme Court held as under:

“Monetary punishment is to be carried out from the assets held by the offender; his death would not absolve the legacy and it is unambiguously evident by the legislative intent manifested in section 386 of the Code of Criminal Procedure, 1898. Diyat is amongst the punishments provided under the Code and according to clause (e) of section 299 thereof, it is compensation payable to the legal heirs of the victim, value whereof, is equivalent to 30,630 grams of Silver to be determined on yearly basis. Section 331 of the Code provides that an offender burdened with payment of Diyat, in the event of default, shall remain lodged in prison until it is paid in full or through installments settled against security, however, under subsection (3) thereof, in the event of his death, it shall be recoverable from his estate. A combined reading of section 431 of the Code of Criminal Procedure, 1898 with section 331 of the Code, unambiguously ensure continuation of appeal by an offender liable to payment of Diyat even after his death, thus, there was no occasion for the learned Judges in the High Court to short-circuit the proceedings without adjudication on merit.”

15. For the above stated reasons and law laid down in the above mentioned judgments, as appellant has expired during pendency of appeal, proceedings are abated against him. However, since we have heard his appeal on merits and dismissed the same whilst upholding the impugned judgment. So far as fine of Rs.62.354 million is concerned, the same is ordered to be recovered as land revenue from assets devolving upon the legal heirs of deceased appellant in accordance with law.

16. The instant Accountability Appeal stands disposed of in the above terms.

JUDGE

JUDGE