LAHORE – Lahore High Court (LHC) Chief Justice Umar Ata Bandial on Friday ordered the auction of assets and different units of the Ittefaq Group of Industries for recovering loans of different banks amounting to about Rs3 billion.

The chief justice issued the order dismissing a civil miscellaneous application moved by the Miraj family in the main case, in which the LHC had issued a stay order against the sale of these units that was also vacated on Friday.

Mian Meraj Din, a shareholder in the Ittefaq Group of Industries and an uncle of twice former Prime Minister Nawaz Sharif, had challenged the sale of three units on the ground that their auction was in violation of Section 284 of the Companies Ordinance.

“Since I am the owner of three units – Ittefaq Foundries, Ittefaq Brothers and Brothers Steel Mills – they could not be sold out,” Meraj had submitted. However, the chief justice ruled out that these units were mortgaged with the banks at the time of securing loan and they would be sold out to recover the amount of loans. The court also allowed a sale committee to sale out different units of the Ittefaq Group of Industries for recovering the loans.

The National Bank of Pakistan, Habib Bank Ltd, United Bank Ltd, Zarai Taraqiati Bank of Pakistan, Muslim Commercial Bank, Picic Bank, First Punjab Mudarba and Corporate Law Authority had filed the petition in 1998.

The petitioners prayed to the court to order for the recovery of their loans through auction of the Ittefaq Foundries, Ittefaq Textile Mills, Khalid Siraj Industries and other units because they had failed to fulfill their financial commitments made against the loan given to them.

The LHC had ordered the sale of these industrial units on the banks’ petition and a sale committee was constituted, comprising representatives of banks, to monitor the auction. Nawaz Sharif had handed over four units, including the Ittefaq Foundries, Ittefaq Brothers and Brother Steel Mills, to the eight scheduled banks to clear their loans, but the banks objected to it and demanded cash settlement against the loans.

Also, the LHC on Friday again suspended a notification appointing Zia Latif as chief executive officer (CEO) of the Lahore Electric Supply Company (Lecso).

The court had restrained Zia Latif from acting as the Lesco CEO on a petition moved by his predecessor Sharafat Sial. After Sial withdrew his petition, Justice Muhammad Khalid Mahmood Khan issued the order on another petition filed by Ateequr Rehman Khan, superintendent engineer, through Rafique Rijhwana.

The petitioner submitted the Ministry of Water and Power had appointed Zia Latif as the CEO on contract basis despite filling the post on permanent basis.

“Only the Lesco Board of Directors could appoint the CEO; however, Zia Latif had been appointed on political basis through a notification issued by the ministry,” contended the petitioner, adding the appointment was also discrimination with many Lecso officers.

He said the Lesco chief had strong political contacts and was also facing allegations of corruption and mismanagement. He requested the court to declare the appointment as illegal and unlawful.

The court heard initial arguments and suspended the notification appointing Zia Latif as the Lesco CEO. The court also sought reply from the Water and Power Ministry and other respondents.

Separately, the LHC on Friday summoned the chief executive officer of the Faisalabad Electric Supply Company (Fesco) for not removing electricity poles installed on the land of a woman.

Naziran Bibi of Faisalabad through her counsel submitted that the court had directed the Fesco authorities to remove the electricity poles illegally installed on her property, but the order had so far not been obeyed.

The Fseco counsel told the court that the order had been complied with and poles had been removed from the property of the petitioner. However, the petitioner’s counsel stated that the order had not been completely implemented as the Fesco had removed only one of the two poles.

After hearing arguments of the two sides, Justice Khalid Mahmood Khan issued a notice to the Fesco CEO and directed him to appear in person on October 8.