LAHORE, July 8: A banking court has initiated execution of a Rs47.319 million loan recovery suit filed against the Ittefaq Textile Mills by the Allied Bank (ABL).

The mill, said to be worth Rs120.92 million, is jointly owned by seven families of the Ittefaq Group, including that of the exiled former prime minister Nawaz Sharif.

The Lahore High Court on May 5, 2001, issued a decree in favour of the bank and referred to a banking court for its final execution.

The court would issue the orders for the liquidation of mill after receiving cost estimation from a customs appraiser who has been appointed by the court. The suit amount would be paid from the sales proceeds of the property.

The suit has been filed against Mian Yousaf Aziz, Mian Haroon Yousaf, Mrs Kausar Yousaf, Mrs Ayesha Haroon, Mrs Saira Farooq and Muhammad Sadiq under the Banking Courts Act, 1997.

As alleged by the plaintiff, the directors of the mill secured the loans by pledging its shares with the bank and leasing companies. It has been alleged that signatures of the two share-holders — Ms Hanifan and Ms Anwar — were forged by the borrowers while securing credit from the bank.

The mills is owned jointly by the families of seven brothers Mian Muhammad Sharif, Mian Muhammad Shafi, Mian Meraj Din, Mian Siraj Din, Mian Farooq Barkat, Mian Muhammad Yousaf and Mian Muhammad Bashir. With the exception of first two, all the remaining have died.

Mian Sharif’s family is the largest stakeholder in the mill with 791,072 shares. The break-up of 5.050 million shares of the mills is as follows:

Mian Muhammad Sharif (379,705), Mrs Shamim Akhtar (291,643), Mian Nawaz Sharif (48,606), Mian Abbas Sharif (17,675), Husain Nawaz Sharif (6,000), Hamza Shahbaz (4,800), Mian Yousaf Abbas (4,231), Mrs Sabiha Abbas (13,635), Maryam Nawaz (6,062), Ayesha Shahbaz (1,000), Sara Abbas (3,981), Salma Abbas (3,981), Mian Muhammad Shafi’s family (731,198), Mian Meraj Din’s family (671,699), Mian Siraj Din’s family (620,911), Mian Farooq Barkat’s family (709,811), Mian Muhammad Yousaf’s family (701,595) and Mian Muhammad Bashir’s family (645,741).

According to the property valuation report submitted by the ABL’s Special Assets Management (north) Wing before the court on August 15, 2001, the total value of the mill was Rs129.274 million. As surveyed by the plaintiff, the mill was spread over 700 marlas of land with a covered area of 89,477 square feet. The mill has been operating in two units with unit two constituting 33 per cent of the total project. The machinery is of 1985-86 model.

“Due to mismanagement and closure of the factory in different periods, the machinery has outlived its life,” observed the surveyor.

The cost of land and building has been estimated at Rs25.869 million with the machinery being valued at Rs103.405 million, taking the total value of the project to Rs129.274 million. The net realizable value has been estimated at Rs104.712 by the ABL after taking into account the depreciation. However, the survey team has cautioned in its report that the “net realizable value would be very difficult to be realized in case the plant has been closed down by the existing lessee.”