Islamabad - The Supreme Court has raised serious objections over appointing handpicked officers as heads of important state institutions in complete disregard for merit, honesty and integrity.

“We are in no manner of doubt that by conscious planned and premeditated design all important State institutions which could offer any resistance or act as impediments in the way of loot and plunder of State resources which rightfully belong to the people of Pakistan by those who wish to impoverish our country and its people have been captured, taken over and neutralized by appointment of their handpicked officers in complete disregard for merit, honesty and integrity to head such institutions,” observed Justice Ijaz ul Ahsan in the Panama leaks verdict.

“These cronies owe their loyalty to their masters to whom they are beholden and do not feel any sense of allegiance, loyalty or fidelity to the country or its people. This state of affairs has brought us to the sorry, pitiable, pathetic and heartbreaking situation that we find ourselves in,” Justice Ahsan further observed.

“In our quest to judge, analyse and examine the inclination, disposition and ability of the State institutions and functionaries created and charged with the responsibility to probe, investigate, inquire into matters of this nature… we also summoned representatives of FIA, FBR and Ministry of Interior to appear before us,” Justice Ijaz observed.

The FBR took the stance that it had taken immediate cognizance of the matter and issued notices to all those, whose names had appeared in the Panama Papers. “This ‘immediate cognizance’ translated into the half-hearted issuance of some notices six months after the information came into the public domain which speaks volumes of the lethargy, carelessness and inefficiency displayed by the premium tax and financial watchdog of the country,” he remarked.

The FBR chairman “informed us that as soon as the Panama Leaks appeared in April 2016, the FBR immediately took up the matter and started investigations/measures to collect information regarding the persons, about 400 in numbers, who allegedly owned offshore companies. Chairman stated that there were practical and procedural difficulties in finding the full names and addresses of the persons whose names appeared in the Panama Papers. On being pressed to disclose when such information was sought, the FBR chairman hesitatingly informed us that the first notice/correspondence was initiated in October 2016.

“Even the initial steps were half-heartedly initiated six months after the afore-noted information came to light. It is astonishing to see that while the matter was being widely agitated and discussed in the print and electronic media and the courts were being approached by different parties who were clamouring for investigation and probe, the FBR had gone into deep slumber and failed to initiate even the preliminary steps towards ascertaining the identities and other antecedents of the persons named in the Panama Papers, let alone taking any action against them,” Justice Ahsan remarked.

“The FBR chairman informed us that since a large number of persons named in the Panama Papers were either non-filers or non-residents, information and data regarding the said persons was not available in the database of FBR. However, the matter had to be coordinated with NADRA and other State agencies charged with the responsibility of maintaining the records of citizens to collect the requisite information in order to have access to such persons. Further, since the record and information relating to offshore companies was beyond the territorial jurisdiction of Pakistan and located in a number of tax havens including the British Virgin Islands, letters were written to the Foreign Office of Pakistan to coordinate with their counterparts in the British Virgin Islands etc. in order to collect the requisite information. However, so far no appreciable progress has been made in this regard.”

With reference to the respondents in these constitution petitions, the Chairman, FBR pointed out that Respondents No.7 (Hussain Nawaz) and 8 (Hassan Nawaz) are non-residents and therefore not amenable to the jurisdiction of the tax authorities in Pakistan. He submits that although the said persons were issued notices, they filed their replies on 21.11.2016 in which the position taken by them was that since they were non-resident Pakistanis, they were under no obligation to file returns or pay taxes on income generated outside Pakistan.

The FBR chairman was asked to explain how respondent No-7 claimed to have an NTN when the same was issued in 1995 and according to a circular issued by the FBR itself, all tax numbers issued up to 1998 stood cancelled and fresh tax numbers could be obtained by filing appropriate applications before the competent authorities which had apparently not been done. His response was that he had no specific information in this regard. However, the learned Additional Attorney General submitted that according to the records of FBR, respondent No-7 was the holder of an NTN which appeared in the database of FBR. He later confirmed that the earlier had subsequently withdrawn and all tax numbers initially issued by the FBR had been restored/revived.

“After hearing the FBR chairman, we are constrained to express our dissatisfaction and extreme disappointment on the mode and manner in which the premier taxation authority of the country has dealt with the matter,” Justice Ahsan observed. On behalf of the NAB, its chairman said that it was waiting to be approached by the “regulators”, like SECP, FBR, State Bank of Pakistan, etc before it could initiate any proceedings.

When his attention was drawn towards the provisions of the NAO which empowers NAB to initiate proceedings on its own accord and asked why such powers had not been exercised, he had nothing much to say except to mumble a half-hearted apology and an equally half-hearted promise to “look into” the matter.

“We are perturbed and disappointed to find that State functionaries/institutions charged with the responsibility to enforce the law and safeguard the interests of the State by strict, impartial and unbiased enforcement of the laws are disinclined, disinterested and unwilling to do so,”.

The Ministry of Interior pleaded lack of jurisdiction so did the FIA which stated that nobody had approached it in this regard. It also pleaded lack of jurisdiction.

The complete and utter apathy shown by the State functionaries/departments including the FBR in this matter has raised many questions and the constant foot-dragging on their part shows a complete and utter lack of interest and a desire to sweep the matters under carpet, Justice Ijaz remarked. This is obviously at the behest of those likely to be affected by deeper probe and investigation into the matter, he observed.