P L D 2003 Lahore 106 (PLP)

2. Precisely stated, the facts culminating to the filing of the present petitions are that the petitioner, on 24‑8‑2002, filed his nomination papers to contest the Provincial Assembly Elections from Constituency PP‑241, Dera Ghazi Khan II (subject‑matter of this petition) and National Assembly Elections from Constituency NA‑171, Dera Ghazi Khan‑I (subject‑matter of W. P.No.17063 of 2002) before the concerned Returning Officers. Respondent No. 3 (Sardar Fateh Muhammad Khan Buzdar in W. P. No. 17061 of 2002 and Khawaja Sheroz Mahmood In W.P.No.17063 of 2002). The contesting candidates from the afore‑noted two constituencies, raised, separate objections against the candidature of the petitioner, mainly contending therein that he was a defaulter, because a huge amount of loan was taken by the company known as M/s. Langar Sulaimani Industries Ltd., D.G. Khan of which he was one of the Directors. It was further the case of respondent No.3 that an interim decree dated 18‑11‑1999, was passed against certain defendants, including the petitioner, and the said decree is still unsatisfied, therefore, it was alleged that the petitioner is not qualified to contest the forthcoming elections. On the scrutiny of the nomination papers, the Returning Officers of PP‑241 as well as NA‑171 accepted the said objections of respondent No.3 and both the nomination papers, filed by the petitioner from the afore‑noted two constituencies, were rejected by the Returning Officer vide two separate orders dated 2‑9‑2002, holding therein that the petitioner is a defaulter of more than Rs.2 Million for more than one year and is, thus, disqualified Obviously the petitioner felt aggrieved and filed two separate appeals under section 14(5) of the Representation of People Act, 1997, read with Rule 5 of Representation of People (Conduct of Elections) Rules, 1997, before the Election Tribunal, but without any success as his appeals were dismissed by the learned Election Tribunal vide single order dated 12‑9‑2002, hence the present two Constitutional petitions.

3. Pursuant to the issuance of notice, Dr. Danishwar Malik, learned Deputy Attorney‑General has entered appearance on behalf of respondent No.4, while Sardar Khurm Latif Khan Khosa, Advocate, has represented respondent No.3 in both the cases.

4. Learned counsel for the petitioner leas submitted that both the forums below have erred in law in rejecting the nomination papers of the petitioner from both the constituencies without taking into consideration the provisions of Chief Executive's Order No.7 of 2002. He has further submitted that the ingredients of Article 81(2)(o) of the aforesaid Order are not at all attracted in the case of the petitioner, as he did not obtain any loan in his name or in the name of his spouse or any of his dependants. Learned counsel while referring to certain documents on record, further added that although the interim decree was passed yet, the suit is still pending, wherein the evidence is yet to be recorded, therefore, the submission of the learned counsel is that no final adjudication has been made by any Court determining the liability of the petitioner as a defaulter. He has re‑enforced his arguments by submitting that although he was a Director of the afore-noted company, yet Form XXIX submitted to the Company Registration Office, shows that he resigned from the company with effect from 22‑6‑1994, therefore, he cannot be saddled with any liability and in addition thereto he was holding 8% shares only.

5. Conversely, the learned counsel for respondent No.3, while refuting the aforesaid contentions, has submitted that the petitioner was not only a Director of the Company, but was also a guarantor and that interim decree for a sum of Rs.29,15,32,000 was passed against defendants Nos.2 to 10, wherein the petitioner was arrayed as defendant No.4, as they have executed personal guarantees in favour of the A.D.B.P. In support of this contention the learned counsel has placed on record photo copies of interim decree as well as judgment rendered by the Full Bench of this Court. In W.P. No. 16711 of 2002 (PLD 2003 Lah, 169), titled Rao Tariq Mehmood v. The Election Tribunal etc.

6. There is no denial of the fact that the petitioner was one of the Directors of Private Ltd. Company by the name of M/s. Langar Sulaimani Industries Ltd. Dera Ghazi Khan which obtained loan from the Agricultural Development Bank and the petitioner stood as one of the guarantors. Upon committing default by the company and the guarantors/Directors, Agricultural Development Bank of Pakistan filed a suit for the recovery against the company and other persons, including the petitioner, before this Court in its civil original jurisdiction, wherein, on 18‑11‑1999, an interim decree for the recovery of Rs.29,15,32,000, together with mark‑up at the agreed rate from the date of filing of the suit till realization, was passed against defendants Nos.2 to 10 (petitioner was listed as defendant No.4), as they executed personal guarantees in favour of the Bank. Needless to add that the said decree was jointly and severally passed against all the defendants, which is still unsatisfied. The petitioner in order to show that the said interim decree has been assailed by way of filing the appeal, has appended copy of memorandum of appeal (R.F.A.No.8 of 2000), but no document has been placed on record in order to establish that either the said interim decree has been set aside or even operation of the said decree has been suspended. Even, during the arguments the learned counsel could not satisfy this Court on the point that the said decree has been suspended by this Court in exercise of its appellate jurisdiction. It flows from the above that the aforenoted company, to which the petitioner was one of the components, obtained the loan from Agricultural Development Bank and he furnished his personal guarantee thereby undertaking to liquidate the liabilities of the company, in case of its failure to fulfil its obligations, and subsequently an interim decree was passed, which remains still unsatisfied, though the same has been assailed before the higher forum. Now the petitioner is not only a guarantor but by virtue of the aforenoted decree has also become a judgment‑debtor, thus, we are of the view that it can neither be argued simply on the basis of Article 8D (2)(o) of the aforesaid Order that he did not obtain any loan in his name, in the name of his dependants or in the name of his spouse nor the petitioner can be permitted to take shelter under the said provisions of law. Needless to note that the position of the petitioner qua the loan has further been worsened by way of passing an interim decree of such a colossal amount. The petitioner, at any stage, could have easily satisfied the decree and then contest the elections. To our mind he cannot be allowed to contest the forthcoming elections, when a colossal public money has illegally been with held by the petitioner, the financial institution is clamouring for the realization of the decretal amount and the petitioner has been able to forestall the execution of the decree for the last more than 3 years, despite the fact that no injunctive order was granted by any Court nor the operation of the decree was suspended. This fact amply manifests the intention of the petitioner to liquidate public money and the resources he has to prevent the process for the execution of the decree.

7. As regards the contention raised by the learned counsel regarding Directorship of the petitioner, suffice it to say that the petitioner was not arrayed in the suit only on the basis of Directorship of the company, but he was impleaded as party in the suit on the basis of a guarantee, as the petitioner, statedly, stood guarantor for the repayment of the loan. There is co cavil to the proposition that under section 128 of the Contract Act the liabilities of the principal debtor and the guarantor are co‑extensive and that is the reason why the interim decree was passed, jointly and severally, against the petitioner and other defendants. Photocopy of the interim decree, produced by the learned counsel for respondent No.3, amply fortify the fact that the interim decree was passed against the petitioner not in the capacity of a Director of the company but as a guarantor for the repayment of the loan. We are of the view that the position of the petitioner qua the said transaction has further deteriorated as the petitioner has been relegated to the position of a judgment‑debtor from a guarantor, against whom a decree for the huge amount is outstanding, which still remains to be satisfied.

8. So far as the contention raised by the learned counsel that the petitioner has sold his 8% shares of the company as far back as on 22‑9‑1994, that limb of argument would also be of no avail to the petitioner as the guarantee must have been executed prior to the alleged sale of the shareholding of the petitioner. The petitioner has not placed on record the copy of the plaint upon which we could ascertain that at what point of time and on which date the petitioner executed the guarantee attributed to him. Even on our asking the learned counsel could not produce the copy of the plaint. It is settled law that even resignation from the Directorship of the company or the sale of shareholding would not in any way absolve a person from the rigors of execution of the guarantee prior to the resignation or sale of the shares of the company. Even subsequent revocation of guarantee or/and resignation from the Directorship of the company would not discharge the guarantee or the liabilities of the guarantor incurred and undertaken prior to the said happenings. Under section 130 of the Contract Act, of course, a surety is competent to revoke the guarantee but that revocation would be regarding the future transactions and could not affect the transactions, already undertaken by the said guarantor, or the guarantee already furnished by the guarantor. The petitioner has failed to place on record any document in order to show that he, in the capacity of the surety/guarantor, has been discharged either by the principal debtor or by operation of law. Be that as it may, the bitter fact remains that decree for the colossal public 'money is outstanding against the petitioner and others since 18‑11‑1999, the same is still unsatisfied: It appears that the petitioner by his acts and omissions has not allowed the said decree to be executed, even after the lapse of 3 years and still he has courage to say, in the Constitutional petition, that he is not a defaulter quid he may be allowed to contest the National as well as Provincial Assemblies Elections. We are unable to comprehend these two situations, which do not coincide and are polls apart.

9. Now coming to the contention raised by the learned counsel regarding the interim decree. The concept of passing the interim decree was introduced by the Legislature, while promulgating the Banking Companies (Recovery of Loans, Advances, Credits and Finances) Act. 1997. Section 11 of the said Act provides that a Banking Court is empowered to pass an interim decree in respect of the part of the claim, which appears to be payable by the defendants to the plaintiff. Section 11, subsection (2) provides that the interim decree shall he executable and appealable as a decree passed under the said Act. It flows from the above that the interim decree is a "decree" for all intents and purposes inasmuch as the same is not only executable as a decree but also appealable. However, it has been. provided that, if any amount will be recovered through an interim decree the same shall be adjusted at the time of passing of the final decree.

10. We have examined the photo copies of the nomination papers, submitted by the petitioner, to contest the elections from both the aforenoted constituencies and find that the petitioner did not mention in his nomination papers that a decree for a huge amount has been passed against him in the capacity of the guarantor and that the same is still unsatisfied. This fact is sufficient to come to the conclusion that the petitioner is not qualified to contest the elections in view of Article 8D(1)(g) of the aforesaid Order.

11. We have examined the judgment rendered by the learned Full Bench of this Court in W.P. No.16711 of 2002, copy whereof has been furnished by the learned counsel of respondent No.3. We find that almost similar questions were involved in the aforenoted case and this Court while dilating upon almost similar issues came to the following conclusions:‑‑ "...... This fact was not mentioned by the petitioner in the columns of the Liabilities, Verification and in the affidavit submitted by the petitioner in the nomination papers. This fact alone is sufficient to come to the conclusion that the petitioner is not qualified to contest the election in view of Article 8D (1)(g) of the aforesaid Order. As the decrees against the petitioner stand unsatisfied and the debt is not finally repaid, the petitioner is a defaulter of a bank loan. The Tribunals below were justified to reject the nomination papers of the petitioner in view of the provisions of section 14(5)(A) of the Representation of the People Act, 1976, which empowers the Tribunal to reject the nomination papers if it is found that a candidate is a defaulter of loan. It is pertinent to mention here that section 14(3)(c) of the Representation of the People Act, 1976, contemplates rejection of the nomination papers of a candidate if the provisions of sections 12 and 13 of the aforesaid Act are not complied with. As mentioned above, by virtue of the decrees referred to above, it was the liability of the petitioner, which was suppressed by the petitioner from his nomination papers and filed false affidavit thereby attracting the provisions of Article D(1)(g) of the Conduct of the General Elections Order, 2002. The petitioner cannot be considered as an honest person. due to the non disclosure of his liabilities in his nomination papers, therefore, he stood disqualified from contesting the election to the Provincial Assembly, his nomination papers were, thus, rightly rejected by the Tribunals below. In arriving at this conclusion, we are fortified by the following judgments: Babu Muhammad Munir v. Appellate Tribunal of the Election Commission and others (1993 SCMR 2348). Aijaz Ali Khan Jatoi v. Liaquat Khan Jatoi (1993 SCMR 2350). The petitioner has invoked the Constitutional jurisdiction which is discretionary in nature. It is settled principle of law that he who seeks equity must come to the Court with clean hands. In view of the concealment of the liabilities in the nomination papers by the petitioner, we are not inclined to exercise our discretion in his favour, in view of the law laid down by the Honourable Supreme Court in the following judgments:

1. Abdul Rashid v. Pakistan and others (1969 SCMR 141),

2. Principal, King Edward Medical College v. Ghulam Mustafa (1969 SCMR 196),

3. Rana Muhammad Arshad v. Additional Commissioner (Revenue) (1998 SCMR 1462). In view of what has been discussed above, this writ petition has no merit and the same is dismissed."

12. In addition to the findings recorded by us, in the light of the dictum laid down by the Full Bench of this Court in the aforenoted case, we have examined the orders rendered by the two forums below and find that the impugned orders are legal, unexceptionable, apt to the facts and circumstances of the case and do not call for any interference by this Court in exercise of its Constitutional jurisdiction, which is not only discretionary but equitable also. In the above perspective, we are of the view that the present petitions are devoid of merits, thus, we are constrained to dismiss both the petitions with no order as to costs. M.B.A./M‑1493/L Petitions dismissed.