ISLAMABAD: The Islamabad High Court (IHC) on Wednesday allowed the Federal Investigation Agency (FIA) to proceed against the suspects allegedly involved in the Rs290 million EOBI investment scam.

Justice Tariq Mehmood Jahangiri of the IHC dismissed four petitions filed against the ongoing inquiry by the FIA into purchase of Rs290m worth of shares of a loss-making entity by the Employees Old-Age Benefits Institution. The petitions were filed by Amtex Private Limited owner Khurram Iftikhar, Khurram Shahzad and two market securities.

Khurram Iftikhar, being chief executive of the company, appeared before the FIA and got his statement recorded on Dec1, 2011, in connection with the EOBI investment in shares of his company. The directors of the company again received notices from the FIA in 2013. The petitioners again appeared before the FIA in the second inquiry and got their statements recorded.

The FIA started the third inquiry and consequently registered an FIR under Sections 409, 109 and 34 of the Pakistan Penal Code, read with Section 5(2)(47) of the Prevention of Corruption Act, 1947, against them on December 31, 2015, at the FIA police station, Karachi, over allegations of causing a loss of Rs290m to the public exchequer/EOBI.

Dismisses petitions filed against inquiry into institution’s Rs290m investment in loss-making entity

The petitioners had challenged the FIA inquiry and secured a restraining order.

Petitioners’ counsel Hasnain Kazmi and Salman Aslam Butt argued before the IHC that their clients were being unnecessarily harassed by various public functionaries and the FIA was causing substantial pecuniary damage and loss to the reputation and good will of the companies.

They contended that in terms of FIA rules, more specifically Rule 5 thereof, initiation of any inquiry and registration of any criminal case by the FIA involving any public servant over BPS-19 requires prior authorisation, approval and permission of the Federal Anti-Corruption Council.

The allegations levelled in the FIR can only be dealt with under special enactments and not general law of the land. The SECP Ordinance provides the machinery for dealing with the matters related to securities, including prosecution of offences, the counsel argued.

SECP’s counsel also challenged the jurisdiction of the IHC on the grounds that the subject matter of sale of shares took place in Karachi within the territorial jurisdiction of the Sindh High Court.

The EOBI also contended that since the inquiry had been conducted in Karachi, the FIR registered in Karachi and the challan submitted to the court of competent jurisdiction in Karachi, the IHC had no jurisdiction to adjudicate upon the matter.

The FIA, on the other hand, informed the court that the petitioners had neither joined the investigation nor surrendered themselves before the court of competent jurisdiction. Final challan was submitted on May 22, 2017, to the court of Special Judge Central-II, Karachi.

As per the prosecution case, the EOBI had purchased 11,700,000 shares of Amtex Private Limited on Aug 16, 2010 for Rs227,172,818 at Rs19.3716 per share. It again purchased 5,650,000 shares of Amtex Limited on Aug 27, 2010 for Rs110,487,106 at Rs19.51 per share. Total 17,350,000 shares were purchased by the EOBI for Rs337,659,914.

The shares were purchased on the recommendation and approval of EOBI’s investment committee comprising Kanwar Khursheed Wahid, the then DG investment, and Zafar Iqbal Gondal, the then EOBI chairman.

The current value per share is Rs2.73.

The petitioners had not appeared before the trial court and were declared absconders, the FIA told the high court.

Justice Jahangiri noted that “it has also transpired from the order sheets of the learned trial court that petitioners are absconders, their non-bailable warrants of arrest have also been issued but the FIA officials are not arresting them as FIA has been restrained from arresting the petitioners vide order dated May 24, 2016 passed by this court [IHC]”.

Citing earlier precedents of the superior judiciary, Justice Jahangiri declared that “in view of above discussion and laws laid down by the Hon’ble Supreme Court of Pakistan, all the petitions are not maintainable, hence dismissed being meritless”.

Published in Dawn, June 17th, 2021