ISLAMABAD: The Public Accounts Committee (PAC) of the National Assembly warned the ministry of defence on Monday that if it failed to submit its report on financial mismanagement in the National Logistics Cell by June 30, the committee would go ahead with its own findings and fix responsibilities.

The PAC had in November last year decided to withhold its final recommendations and give some time to the military authorities after Army Chief General Ashfaq Pervez Kayani announced that the GHQ would hold its own investigation into the scandal. But so far nothing has been done by the army.

Three generals (now retired) were allegedly involved in misadventures in the stock exchange which caused a loss of about Rs2 billion to the NCL.

PAC Chairman Chaudhry Nisar Ali Khan did not attend the committee meeting because of illness. PAC member Zahid Hamid of the PML-N asked Defence Secretary Lt-Gen (retd) Athar Ali to convey Chaudhry Nisar`s message to the army chief.

“Initially, the army chief said the inquiry into the NLC scam would be completed in a couple of months, but unfortunately it has been well over seven months and there is no response from the military side. The PAC has to complete its report by June 30. It can`t wait any more,” Mr Hamid quoted the PAC chief as saying.

“The PAC has already given enough time to the military authorities to conduct their own inquiry and fix responsibilities. Billions of rupees went down the drain because of wrong decisions by former bosses of the NLC and now it`s time to take tough decisions,” Chaudhry Nisar said.

The defence secretary said he would immediately convey the committee`s concern to the army chief and report back to it.

It may be mentioned that three inquiries have been conducted at various levels over the past couple of years to determine who had ordered the investment of a huge amount of Rs4 billion into the risky business of stock market.

The first inquiry was carried out by the Planning Commission on the directives of the PAC. When the committee was discussing the PC`s report, it was informed that the new NLC management had hired a consultant to prepare a fresh report on the scam. Initially, the consultant`s report was not submitted to committee. But at the insistence of the PAC chairman it was made available.

After going through the two reports when the committee was about to make its final recommendations, it was informed that a local chartered accountancy firm had prepared a report which also covered the wrongdoings committed under a director general of the NLC.

The committee sought this report and decided to make final recommendations after going through the three reports. At one meeting of committee, the PAC chairman said “everything is crystal clear”, but so far nobody has been held responsible.

According to facts presented before the PAC, bosses of the NLC had made heavy investments in the stock exchange between 2004 and 2008 in violation of government rules. Besides borrowing money from commercial banks at high mark-up rates, they also used pensioners` money for the business.

In return, heavy commissions were received from companies through which the investment of over Rs4 billion had been made in the stock market. The NCL suffered a loss of nearly Rs1.8 billion.

Lt-Gen (retd) Khalid Munir Khan (officer-in-charge of NLC from Jan to June 2005), Lt-Gen (retd) Mohammad Afzal Muzzafar (officer-in-charge from June 2005 to Oct 2008) and Maj-Gen (retd) Khalid Zaheer Akhtar (director general from July 2002 to Jan 2008) are at the centre of investigations.

Former director finance and accounts Najibur Rehman, who worked for the NCL from Oct 2002 to April 2007, and former chief finance officer Saeedur Rehman (June 2004 to Oct 2008) were also allegedly involved in the questionable investment.

At present Mr Rehman is member finance in the CDA.