2016 PLP 2026 (SCMR)
AKBAR ALI and others — Appellants Versus STATE BANK OF PAKISTAN and others — Respondents
| Citation | 2016 PLP 2026 (SCMR) |
| Forum / Court | Supreme Court of Pakistan |
| Bench Members | Anwar Zaheer Jamali, C.J., Amir Hani Muslim and Faisal Arab, JJ |
| Parties | AKBAR ALI and others — Appellants Versus STATE BANK OF PAKISTAN and others — Respondents |
| Primary Law | (a) Banking Companies Ordinance (LVII of 1962), (b) Administration of justice |
Q1: What are the key laws and sections cited in 2016 PLP 2026 (SCMR)?
This judgment primarily cites: (a) Banking Companies Ordinance (LVII of 1962), (b) Administration of justice as referenced in Pakistani case law index.
Q2: Which judicial bench decided the case 2016 PLP 2026 (SCMR)?
The case was heard and decided by the Supreme Court of Pakistan bench comprising: Anwar Zaheer Jamali, C.J., Amir Hani Muslim and Faisal Arab, JJ.
Q3: What is the official citation format for this judgment on Pakistan Law Portal?
Cite this legal precedent as: 2016 PLP 2026 (SCMR) (AKBAR ALI and others — Appellants Versus STATE BANK OF PAKISTAN and others — Respondents). Read the full summary and cross-referenced laws free on Pakistan Law Portal.
Laws Cited
Representation
- Kh. Azhar Rasheed, Advocate Supreme Court and Ahmed Nawaz Ch., Advocate-on-Record (Absent) for Appellants (in C.As. 1359-1360 and 1447-1448 of 2013).
- Z.K. Malooka, Advocate Supreme Court for Appellants (in C.A. 1511 of 2013).
- Haji M. Zahir Shah, Advocate Supreme Court/Advocate-on-Record for Appellants (in C.A. 1448, 1511 of 2013, C.M.As. 7981 of 2013 and 4609 of 2014).
- M. Saeed Khan Shangala, Advocate Supreme Court and M. Ajmal Khan, Advocate-on-Record (Absent) for Respondent No.4 (in C.As. 892, 895 of 2012).
- M. Saeed Khan Shangala, Advocate Supreme Court and M. Ajmal Khan, Advocate-on-Record (Absent) for Respondents Nos.21, 23 and 48 (in C.A. 898 of 2012).
- Farooq Zaman Qureshi, Advocate Supreme Court for Respondents Nos. 5 and 8 (in C.A. 1359 of 2013).
- Ghulam Shoaib Jally, Advocate Supreme Court and Syed Rifaqat Hussain Shah, Advocate-on-Record for Respondents Nos. 5, 68 (in C.A. 1446 of 2013).
- Mian Muhammad Hanif, Advocate Supreme Court and M. S. Khattak, Advocate-on-Record for Respondents Nos. 4-12 (in C.A. 1447 of 2013).
- Mian Muhammad Hanif, Advocate Supreme Court and M. S. Khattak, Advocate-on-Record for Respondents Nos. 4 and 5 (in C.A. 1511 of 2013).
- M. Ajmal Khan, Advocate-on-Record/Advocate Supreme Court (Absent) for Respondent No.1
- Qari Abdul Rasheed, Advocate-on-Record for Respondent No.2.
- Raja Abdul Ghafoor, Advocate-on-Record/Advocate Supreme Court for State Bank of Pakistan (in all cases).
- M. Saeed Khan Shangala, Advocate Supreme Court and M. Ajmal Khan, Advocate-on-Record (Absent) for Applicants (in C.M.A. 5415 of 2015).
- Khawaja M. Farooq, Senior Advocate Supreme Court for N.B.P. (in C.As. 1359 and 1360 of 2013).
- Ghulam Shoaib Jally, Advocate Supreme Court and Syed Rifaqat Hussain Shah, Advocate-on-Record for HBL (in C.As. 1359, 1447, 1448 of 2013).
- Ghulam Shoaib Jally, Advocate Supreme Court and Syed Rifaqat Hussain Shah, Advocate-on-Record for HBL (in all cases).
- Syed Zalfiqar Abbas Naqvi, Advocate Supreme Court (Nemo) for Bank of Khyber (in C.As. 1359, 1360, 1447 of 2013 and C.M.A. 7965 of 2013).
Headnotes / Summary
(On appeal against the judgment dated 4.7.2013 passed by the Peshawar High Court, Mingora Bench (Dar-ul-Qaza) Swat, in Writ Petitions Nos. 41, 166, 841, 1203, 1230, 1469, 1470, 1705, 1779, 1781, 2082 of 2011 and 25, 91, 116, 132, 156, 200, 358, 529 of 2012)
Ss. 25 & 41
State Bank of Pakistan SMEFD Circular No. 1/2011 dated 02.02.2011
Write off of loans in certain areas affected by terrorism
Scope
In order to rehabilitate business and industrial activities severely affected by the acts of terrorism in certain parts of the country, the Federal Government announced a relief package for such areas
Pursuant to such announcement, the State Bank of Pakistan issued SMEFD Circular No. 1/2011 dated 02.02.2011 ("the Circular")
In terms of said Circular, loans that were extended by financial institutions for their utilization in certain areas and had remained outstanding as of 31.12.2009 were to be written-off on certain conditions
Impact of such right-off on the financial institutions was to be borne by the Federal Government in the shape of providing subsidy to the affected financial institutions
Employees of the financial institutions located in the areas covered by the Circular claimed that they be also extended the benefit of the write-off scheme as they were also working in the areas to which benefit of the scheme had been extended
Circular of State Bank was followed by a clarificatory letter describing the scope of its application
Said letter provided that the loans extended by the financial institutions to their employees were not eligible for write-off under the Circular
Any category of persons who were excluded from the grant of benefit could not seek a write-off of its financial liability even if it related to the period or the areas covered under the scheme
Write-off package was intended to rehabilitate the business and industrial community of certain specified areas that were badly affected by terrorism, possibly for the reason that they may not close their businesses and shift to other areas, as such shifting might result in a decrease in commercial and industrial activities and an increase in unemployment ratio in the affected areas
Thus the whole purpose of the write-off scheme was to encourage business and industrial activities in such affected areas
Employee of a financial institution located in the affected areas, who had obtained loan from his financial institution, he being already gainfully employed could not be said to have been adversely affected by the hostile business or industrial environment
Claim of employees of financial institutions as borrowers, by no stretch of imagination fell within the object and scope of the write-off scheme
Appeal was dismissed accordingly.
Courts give effect to law or to any instrument having the force of law
Court of law cannot grant a concession under any legally enforceable instrument to a person who is not entitled thereunder. Raja Abdul Ghafoor, Advocate-on-Record/Advocate Supreme Court for State Bank of Pakistan (in all cases). M. Saeed Khan Shangala, Advocate Supreme Court and M. Ajmal Khan, Advocate-on-Record (Absent) for Applicants (in C.M.A. 5415 of 2015). Khawaja M. Farooq, Senior Advocate Supreme Court for N.B.P. (in C.As. 1359 and 1360 of 2013). Ghulam Shoaib Jally, Advocate Supreme Court and Syed Rifaqat Hussain Shah, Advocate-on-Record for HBL (in C.As. 1359, 1447, 1448 of 2013). Ghulam Shoaib Jally, Advocate Supreme Court and Syed Rifaqat Hussain Shah, Advocate-on-Record for HBL (in all cases). Syed Zalfiqar Abbas Naqvi, Advocate Supreme Court (Nemo) for Bank of Khyber (in C.As. 1359, 1360, 1447 of 2013 and C.M.A. 7965 of 2013).
Judgment & Decree
FAISAL ARAB, J.
In order to rehabilitate business and industrial activities severely affected by the acts of terrorism in various parts of the province of Khyber Pakhtunkhwa and the areas of FATA and PATA, the Federal Government in consultation with the Chamber of Commerce and Industry announced a relief package for such areas. Pursuant to such announcement, the State Bank of Pakistan issued SMEFD Circular No. 1/2011 dated 02.02.2011. In terms of this Circular, loans that were extended by financial institutions for their utilization in Malakand, Swat, Buner and Chitral districts and had remained outstanding as of 31.12.2009 were to be written-off on certain conditions. The impact of such right-off on the financial institutions was. to be borne by the Government of Pakistan in the shape of providing subsidy to the affected financial institutions. For the purpose of such write-off, a detailed procedure was prescribed in the circular.
2. The appellants are employees of the financial institutions located in the areas covered by State Bank's SMEFD Circular No. 1/2011 dated 02.02.2011. They claim that they be also extended the benefit of the write-off scheme launched under State Bank of Pakistan's Circular dated 02.02.2011 as they are also working in the areas to which benefit write-off of loans has been extended. We may point out here that this Circular of State Bank was followed by a clarificatory letter dated 17.02.2011 describing the scope of its application. Item Nos. 8 and 22 of State Bank's clarificatory letter dated 17.2.2011 provide that the loans extended by the financial institutions to their employees were not eligible for write-off under the State Bank's Circular dated 02.02.2011.
3. As noted above, the write-off package was intended to rehabilitate the business and industrial environment of certain specified areas that were badly affected by terrorism. Thus the whole purpose of the write-off scheme was to encourage business and industrial activities in such affected areas. As a prerequisite, the financial institutions were required to intimate the State Bank of Pakistan the list of beneficiaries covered under the write-off scheme. As the financial impact of such right-off scheme was to be borne by the Government of Pakistan, the financial institutions were entitled to reimbursement of written-off loans only if they have done so by remaining strictly within the ambit of the State Bank's scheme. Keeping in view the purpose and the scope of the benefit of the write-off scheme, which is to be read with State Bank's SMEFD Circular No.1/2011 dated 02.02.2011 and its clarificatory letter dated 17.02.2011, any category of persons who were excluded from the grant of benefit cannot seek a write-off of its financial liability even if it relates to the period or the areas covered under the scheme. It would have been an altogether different case where a person entitled for a write-off of loan has not been extended the benefit by a financial institution. In such a situation only he and no one else could have sought relief from a court of law.
4. The courts give effect to law or to any instrument having the force of law. A court of law cannot grant a concession under any legally enforceable instrument to a person who is not entitled thereunder. In the present case the whole background of granting concession of write-off was to restore the confidence of the business and industrial community of certain specified areas, possibly for the reason that they may not close their businesses and shift to other areas as such shifting might result in a decrease in commercial and industrial activities and an increase in unemployment ratio in the affected areas. An employee of a financial institution located in the affected areas, who has obtained loan from his financial institution on the bases on which other co-employees are also entitled then he been already gainfully employed cannot be said to have been adversely affected by the hostile business or industrial environment. The appellants' claim, as employees and borrowers of the financial institutions, by no stretch of imagination falls within the object and scope of the write-off scheme. They, therefore, cannot seek extension of the same benefit for themselves which was not extended to them but to others keeping in view an altogether different purpose and object in mind.
5. Vide short order 02.06.2016 these appeals were dismissed and these are the reasons for the same. MWA/A-25/SC Appeals dismissed.