KARACHI, July 2: Judgment in the case of freezing of accounts of Al-Rasheed Trust, on the premise of its alleged involvement in terrorist activities, was reserved by a division bench of the Sindh High Court on Tuesday.
The bench comprised Justice Sabihuddin Ahmed and Justice Zia Pervez.
The petition, filed by Mohammed Suleman, was the consequence of refusal by the Habib Bank Limited to honour its two cheques with endorsement “stop your account by government of Pakistan, which the petitioner termed violation of Articles 23 & 24 of the Constitution.
The petitioner’s counsel Raja M. Irshad, who was assisted by M. Zafar Iqbal, advocate, rebutted arguments of the respondents’ counsel which had centred on international obligations.
Describing the action taken by Habib Bank on the directives of the State Bank as mala fide and illegal, the petitioners counsel pointed out that the government of Pakistan had not imposed any ban on its activities in Pakistan.
He was in complete agreement with the contentions of Mr Mushtaq Memon, amicus curiae who had argued before the bench on Monday that Habib Bank’s contention that had it not acted against the petitioner in Al-Rasheed Trust case, its operation in the US would have become impossible, provided no justification for freezing somebody’s account of the petitioner.
During the course of earlier hearing the attorney general had, however, argued “if the government had not accepted the directions of the Security Council, it would have resulted in the closure of Habib Bank’s branches the world over and the country could have faced great economic difficulties”.
Dismissing allegations of the respondent’s counsel (State Bank of Pakistan and Habib Bank Ltd), that the Trust was involved in terrorist activities, counsel Irshad submitted that Al-Rasheed Trust was still operating in Pakistan and also in Afghanistan and helping the needy.
“If there was any material available, the government would have immediately banned the charitable organization”, he argued.
He referred to a letter which, he said, originated from the US and claimed that while freezing the account the respondents had no material, and they had acted on the instructions of the US.
He urged the court to take cognizance of the objective conditions in which it was operating. He submitted that in Afghanistan Taliban had control of 95 per cent of the territory before being dislodged by the coalition backed forces. The Trust’s operation in that country was to help orphans, destitute etc. especially when restrictions had been imposed on Afghanistan.
At the very outset, the petitioners’ counsel argued that he was deprived of his right without the authority of law and without the show-cause notice.
“Why they did not issue a show-cause notice if they had sufficient material,” counsel Irshad argued.
He said on Sept 25 account of the Trust was frozen, yet on the same day an amount was credited in the frozen account. As per the statment of account given by the Habib Bank in its counter-affidavit, again on Oct 2 certain amount was accepted by the bank in the frozen account, counsel Irshad said.
It was his contention that Section 41 of the Banking Companies Ordinance did not authorize the State Bank of Pakistan to freeze the account of Al-Rasheed Trust. This section, he submitted, had been inserted to protect the rights of investors.
It was his contention that Article 23 of the Constitution provided to every citizen the right to acquire or to hold the property. It was his case that the Security Council resolution under which the respondents had sought refuge for justifying action against the petitioner was not applicable.
He also rebutted the contentions of Habib Bank’s counsel on public and national interests and claimed that national public interest was subservient to the national interest.
Earlier, counsel for Habib Bank, Qazi Fez Issa accused the petitioner of suppressing the facts about other accounts and said that the bank had not acquire the amount but had just frozen the account of the petitioner. It was not acquisition.
At this point, Justice Sabihuddin observed that no law allowing this kind of seizure has been enacted as yet.
The counsel had maintained that exercise of the provisions of the Banking Companies Ordinance 1962 was bona fide, legal and issued in the national interest; the interest of the Financial industry; in consonance with Pakistan’s international commitments and obligations; and public security interest of Pakistan.
The SBP action was initiated bona fide on evidence of the Al- Rasheed Trust assisting, aiding, abetting, and/or encouraging the Taliban, Osama Bin Laden and terrorists, against the interest of Pakistan, its national security, the economy, Pakistan’s international commitments, treaty and customary international law and contrary to public policy and necessity.
It was the case of the respondents that Al-Rasheed Trust was also responsible for inflammatory publications encouraging and inciting violence against Government of Pakistan and encouraging action in favour of the Taliban, Osama Bin Laden and terrorist organisations. In this context, he referred to the logo of Al- Rasheed Trust’s publication “Zarb-i-Momin”.
While Qazi Fez Issa was making submission on Section 40 and 41A of the Banking Companies Ordinance, Justice Sabih again observed that “court has to examine both the restrictions and reasonableness in accordance with the law. Reasonableness of the law must precede the reasonableness of the restrictions”.
When the proceedings commenced, Barrister Zahid Usman Jameel submitted some case laws before the court.
During the course of arguments the locus standi of the UN Security Council resolution vis-a-vis municipal laws, national sovereignty and proprietary rights were agitated and the petitioner built his case on the premise that the action taken at the behest of the US.