THE HIGH COURT OF SINDH AT KARACHI

Criminal Misc. Applications No. 458 and 269 of 2019

Criminal Misc. Application No.561 of 2021

Present: Mr. Justice Muhammad Iqbal Kalhoro

Mr. Justice Abdul Mobeen Lakho

Date of Hearing : 11.01.2022

Date of Order : 11.01.2022

Applicant(s) : Khalid Iqbal through Mr. Tasawar Ali Hashmi advocate in (Cr. Misc. Appln. No.269/2019)

Khurram Shehzad Sindhu through Mr. Muhammad Shahbaz advocate in (Cr. Misc. Appln. No. 561/2021)

Nemo for Hafiza Maryam Khurram in (Cr. Misc. Appln. No. 458/2019)

Respondent No.1 : SECP through Mr. Imran Shamsi advocate

Mr. Muhammad Irfan Memon D.A.G

O R D E R

ABDUL MOBEEN LAKHO, J.- Through instant Criminal Misc. Applications, the applicants have called in question dismissal of their applications under Section 265-K Cr.P.C. Criminal Misc. Application No.561 of 2021 was dismissed for non-prosecution by this Court vide order dated 21.09.2021. However, an application along with affidavit was moved for restoration of the case. For the reasons stated in the affidavit, Criminal Misc. Application No.561/2021 is restored to its original position. In Criminal Misc. Application No. 458 of 2019, none appeared on behalf of the applicant, however, as controversy involved in the matters is similar arising out of same case, as such, we intend to decide all the captioned Criminal Misc. Applications on merits through this single order.

2. The relevant facts in nutshell are that SECP filed criminal complaint No. 1840 of 2017 against the applicants under Section 163 of the Securities Act, 2015 for commission of offences under Sections 128, 129, 130 and 135 punishable under sub-section (1) of section 159 of the Securities Act, 2015. In the complaint it is alleged that as a result of analysis of Karachi Automated Trading System (KATS) data from 01.09.2015 to 31.01.2016, unusual transactions in illiquid shares of Gharibwal Cement Limited by UBL were found. The said analysis led to suspicion that one of the accused person namely Khalid Iqbal (former Head Capital Markets UBL) who was authorized for investment decision to trade on behalf of UBL misused his position to carry out manipulated deals with the connivance of Khurram Shahzad Sindhu, Muhammad Tousif Peracha and Abdur Rafiq Khan structured the deal in trades involving the scrip of Gharibwal Cement Limited, hence, investigation was carried out for said period of five months from 01.09.2015 to 31.01.2016. An internal investigation was carried out by the UBL, wherein it was found that Khalid Iqbal confessed his involvement in rogue trader while misusing his position to carry out manipulated deals in few listed scrips. Accused Khurram Shahzad Sindhu was shown as main accomplice for structuring the deal in trades involving scrip of Gharibwal Cement Limited. During investigation it was found that both the accused were involved in insider trading via front running trading was being done through account of Hafza Maryam Khurram, who was maintaining her trading account with Escort Capital Limited. During investigation, proximity of time between order placement and simultaneous buying and selling through the account of Hafza Maryam Khurram was also established. It further transpired that on 31.12.2015, UBL through accused Khalid Iqbal purchased a total 6.5 million shares of Gharibwal Cement Limited whereas 6.009 million shares were bought on 06.01.2016 and accused Muhammad Tousif and Abdul Rafiq Khan were appearing as counter parties. By transactions of insider trading/ front running the accused made illegal profits and caused financial loss to the UBL which constituted offences of insider trading, market rigging and employment of fraudulent or deceptive devices to trade in listed share pursuant to section 128 and 135 of the Securities Act.

3. Record reflects that UBL filed a criminal case against the Khalid Iqbal and Khurram Shahzad Sindhu at Dubai Court, wherein the charge against Khalid Iqbal was that he being the Investment Manager in stock market at United Bank took a bribe of AED 541,000 in consideration for purchasing undesirable inactive stocks in the market from six different companies in Pakistan with amount of AED 69,787,689 in breach of his job, whereas, the charge against Khurram Shahzad Sindhu was that he was involved in abetment, agreement and assistance with Khalid Iqbal in commission of offence of bribery, which case was proceeded and ultimately accused were acquitted. Against such acquittal, appeal was filed before appellate Court, which was also dismissed. Subsequently, Court of Cassation was approached, who remanded the matter to Appellate Court, where appeal was heard and allowed, which order was again challenged before Court of Cassation, who upheld the order of appellate Court and convicted the accused. Now the matter is pending for execution of judgment. In the proceedings emanating from the complaint of SECP, the applicants moved application under Section 265-K Cr.P.C before trial Court on the ground of double jeopardy. Such application was dismissed vide order dated 23.05.2018, which was assailed before this Court. However, during hearing of the matter, it was informed that accused have been acquitted by Dubai Court which order was affirmed by the appellate Court at Dubai, hence, this Court vide order dated 05.01.2019 disposed of the Misc. Application with directions to the applicants to approach the learned trial Court on fresh ground of acquittal. The applicants again moved an application under Section 265-K Cr.P.C, but the said application was dismissed by the learned trial Court vide impugned order dated 09.05.2019 mainly for the following reasons:

“While dismissing earlier application u/s 265-K Cr.P.C this court had given its findings on 04 grounds on behalf of applicants, which are reproduced as under:

i) The alleged offence has not been committed in Pakistan, hence cannot be tried in Pakistan.

ii) For the same offence UBL has initiated court proceedings against the accused in UAE, hence present proceedings would be double jeopardy.

iii) The commission was not properly constituted, hence was incompetent to order to initiate proceedings against present accused.

iv) The evidence collected during the investigation inadmissible in nature

This court dilated upon all these grounds and the findings were given in detail in the earlier order dt. 23.5.2018. The sole new ground on the basis of which the fresh applications u/s 265-K Cr.P.C are filed, is acquittal of the accused by Dubai courts. The contention of learned counsel for UBL that orders passed by the trial court dt. 31.5.2018 and appellate court dt. 21.11.2018 have been set aside and the matters are remanded back by the court of Cassation Court Dubai has not been rebutted by the learned counsel for the accused. Thus their acquittal orders have not attained the finality. Moreover the acquittal of the accused by Dubai court has no bearing upon the proceedings of this case. The case at Dubai has been filed by UBL for the offence/cause taken place in Dubai while the complaint pending before this court has been filed by Security & Exchange Commission of Pakistan regarding the offence taken place in Pakistan at Karachi Stock Exchange.

Therefore, I do not find any substance in the fresh ground of the applications, hence instant applications are hereby dismissed.”

4. Hence, the applicants have preferred the instant Misc. Applications against the impugned order.

5. Learned counsel for the applicants mainly argued that UBL filed complaint against applicants on identical grounds at Dubai, hence the proceedings on the complaint filed by the SECP is contrary to Article 13 of the Constitution and Section 403 Cr.P.C and the same amount to double jeopardy; that there is no direct evidence available on record in respect of insider trading. Lastly, it is prayed that proceedings emanating from the complaint filed by the SECP may be quashed and the applicants may be acquitted.

6. On the other hand learned counsel appearing on behalf of SECP has argued that complaint has been filed as a result of analysis of Karachi Automated Trading System data for the period from 01.09.2015 to 31.01.2016 relating to unusual transactions in illiquid shares of Gharibwal Cement Limited; that during course of investigation, insider trading through front running transaction with UBL was proved; that the offence was committed in Pakistan hence the complaint filed by the SECP against the applicants does not amount to double jeopardy, therefore, he prayed for dismissal of the applications.

7. We have heard learned counsel for the parties and perused the record carefully.

8. In order to comprehend the issue effectively, it would be appropriate to reproduce the aforesaid two provisions of law as under:-

       "Article 13 of the Constitution:

       Protection against double punishment and self-incrimination. No person....

a)    Shall be prosecuted or punished for the same offence more than once: or

b)   Shall, when accused of an offence, be compelled to be a witness against himself"

"Section 403 Cr. P.C provides as under:

      Persons once convicted or acquitted not to be tried for the same offence.

       (1) A person who has once been tried by a Court of competent jurisdiction for an offence and convicted or acquitted of such offence shall, while such conviction or acquittal remains in force, not to be liable to be tried again for the same offence, nor on the same facts for any other offence for which a different charge from the one made against him might have been made under section 36, or for which he might have been convicted under section 237.

       (2) A person acquitted or convicted for any offence may be afterwards tried for any distinct offence for which a separate charge might have been made against him on the former trial under sections 235, subsection (1).

       (3) A person convicted of any offence constituted by any act causing consequences which together with such act, constituted a different offence from that of which he was convicted, may be afterwards tried for such last-mentioned offence, if the consequence had not happened, or were not happened, or were not known to the Court to have happened, at the time when he was convicted.

       (4) A person acquitted or convicted of any offence constituted by any acts may, notwithstanding such acquittal or conviction, be subsequently charged with, and tried for any other offence constituted by the same acts which he may have committed if the Court by which he was first tried was not competent to try the offence with which he is subsequently charged.

       (5) Nothing in this section shall affect the provision of section 26 of the General Clauses Act, 1897, or section 188 of this Code."

“Article 26 of the General Clauses Act:-

"26. Provision as to offences punishable under two or more enactments--

Where an act or omission constitutes an offence under two or more enactments then the offender shall be liable to be prosecuted and punished under either or any of these enactments, but shall not be liable to be punished twice for same offence."

9. The aforesaid law is based on old principle of common law i.e. "Nemo bis puniture ant vexature pro eodum delico" which means that no one should be subjected to peril twice for the same offence. This fundamental principle of law which has been embodied in our Constitution as well the Code of Criminal Procedure and the General Clauses Act is that no person shall be vexed twice and prosecuted or punished with the same offence, but such principle is not applicable in cases where an accused is guilty of offence under another enactment though by the same chain of facts, he could be tried, convicted and punished under that very offence committed by him. Reliance is placed upon the case reported as Muhammad Nadeem Anwar vs. The Securities and Exchange Commission of Pakistan through Director NBFCs Department, Islamabad (2014 SCMR1376), wherein the Honourable Supreme Court while dealing with the principle of double jeopardy has held as under:

“6…………although both sets of offences had been committed by the accused in one go, however accused acted in such a manner which constituted offences punishable under two separate and distinct laws, i.e. one under the NAB Ordinance and the other under Companies Ordinance. Both are different and distinct pieces of legislation, therefore, acts and omissions committed by him cannot be said to be the same offences……..Since the acts committed by accused do not fall at all within the definition of same offence, therefore, the principle of double jeopardy will not come into force…”

10. In the present case, record reflects that a case at Dubai was filed by UBL for the offences of bribery in purchase of unvested shares which were unwanted in the market from six different companies in Pakistan, however, the Security & Exchange Commission of Pakistan filed a complaint for committing offence of insider trading in Pakistan at Karachi Stock Exchange by the applicants, therefore, in such circumstances, provisions of Article 13(a) of the Constitution of Islamic Republic of Pakistan, 1973, section 403 of the Code of Criminal Procedure, 1898 and section 26 of the General Clauses Act, 1897 are not attracted in the instant case.

11. The learned trial Court has, thus, committed no illegality or irregularity while passing the impugned order, as such, the same warrants no interference by this Court. Consequently, captioned Criminal Misc. Applications are dismissed.

12. These are the reasons for the short order announced on 11.01.2022.

JUDGE

JUDGE

.