Ex-PSM chairman, director acquitted in Rs4.19bn graft case

Published September 1, 2019
An accountability court on Saturday acquitted a former chairman and a director of the Pakistan Steel Mills in a Rs4.19 billion corruption case after the passage of nine years. — Reuters/File
An accountability court on Saturday acquitted a former chairman and a director of the Pakistan Steel Mills in a Rs4.19 billion corruption case after the passage of nine years. — Reuters/File

KARACHI: An accountability court on Saturday acquitted a former chairman and a director of the Pakistan Steel Mills in a Rs4.19 billion corruption case after the passage of nine years.

Moin Aftab Shaikh and Sameen Asghar, the ex-chairman and director (commercial), respectively — were booked by the National Accountability Bureau for allegedly misusing their official authority and embezzling/misappropriating Rs4.19bn in the import of raw materials.

Judge Farid Anwar Qazi of the Accountability Court-IV pronounced his verdict reserved earlier after recording evidence and final arguments from the prosecution and defence.

The judge noted that the prosecution failed to prove the allegations against the two former PSM officials.

The court exonerated them from all charges, discharged their bail and ordered return of the surety.

Despite passing nine years, NAB has failed to prove charges against the two former officials

The proceedings against another suspect, Capt Rashid Abro of M/s Noble Resources Singapore, were discharged on May 22, 2013 in the present case.

Advocates Shaukat Hayat and Khawaja Naveed Ahmed represented the accused while Niaz Husain Mirani represented NAB.

Initially, the Federal Investigation Agency had initiated an inquiry into the alleged scam. In 2009, the Supreme Court had initiated suo motu proceedings into the PSM’s affairs and transferred the investigation to NAB.

According to the prosecution, the PSM management had been procuring coking coal for the last 30 years through a long-term contract of five years and for each succeeding contract year the price was adjusted in accordance with the same percentage of increase and decrease in the average price of Glennies Creek coking coal.

The freight on board (FOB) price for the shipment made during each contract year was to be adjusted from the month of April of relevant year for the whole year, it added.

The prosecution further alleged that during the fiscal year 2008-09 the PSM procured coking coal from four foreign shippers — M/s Anglo Coal, Australia, M/s West Farmers, M/s Teck Coal, Canada and M/s Vales, Australia.

It said that former PSM chairman Shaikh had chaired a meeting on Nov 5, 2008 where it was decided to constitute a committee, headed by the then director-commercial Asghar, to negotiate with foreign suppliers to reduce the prices of the raw material on account of decrease in prices in the international market.

It added that the PSM’s board of directors (BoD) in its meeting on Nov 26, 2008 issued directives to constitute a high-powered committee to negotiate the prices of raw material or freight with the foreign suppliers and shipping companies by offering discount equivalent to difference in current rates.

The prosecution said that the directives of the BoD were not implemented by chairman Shaikh and director Asghar due to which the PSM suffered huge losses as the prices of the steel products had decreased in the international market, whereas the PSM had to procure the raw material on the rates fixed on April 1, 2008 when the prices were at their peak.

It said that the PSM received nine shipments of coal during the fiscal year 2008-09 and a forensic audit into the financial affairs of the mills revealed that during this period prevailing international prices of coal were $125.83 and US$128 per metric ton, thus the PSM suffered a loss of Rs28 million due to non-negotiation of coal prices by the two officials.

Out of nine shipment of coal, only three shipments were opened by the PSM after Nov 26, 2008 when its BoD had directed for negotiations to reduce the prices, the prosecution said, adding that the international contracts for two shipments were made before Nov 2, 2008, where four shipments were made after April 1, 2009 when the prices applicable after this date were paid by the PSM, which were lower than the prices paid for three shipments. Therefore, the PSM suffered a loss of Rs2.20bn.

NAB mentioned that since both the accused did not form a high-powered committee, as directed by the BoD, to negotiate the international imports prices with suppliers and shippers, it caused a loss to the tune of $24.762m.

It alleged that both the accused misused their official authority and official position and obtained undue benefits for themselves and wilfully failed to exercise their authority to prevent the grant or rendition of any undue benefit or favour to foreign supplier, which they could have prevented.

However, both the accused persons with mala fide intentions, ulterior motives and common objective in collusion, connivance and collaboration with Capt Abro illegally, unlawfully, fraudulently and deceitfully extended wrongful gains to the suppliers and caused corresponding losses to the PSM to the tune of Rs4.19bn.

They were charged with committing offences of corruption and corrupt practices punishable under Section 10(a) of the National Accountability Ordinance, 1999.

Published in Dawn, September 1st, 2019



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