SHC warns Axact chief over no-show

Despite court orders Shoaib Shaikh remained absent from hearing of appeal by FIA against his acquittal

Naeem Sahoutara February 21, 2018
Despite court orders Shoaib Shaikh remained absent from hearing of appeal by FIA against his acquittal. PHOTO: PPI

KARACHI: The Sindh High Court (SHC) warned on Wednesday that it may pass orders in a money laundering case against Axact Chief Executive Officer Shoaib Ahmed Shaikh after he failed to appear for a hearing.

A two-judge bench, headed by Justice Naimatullah Phulpoto, has allowed an appeal by the Federal Investigation Agency challenging Shaikh's acquittal, with a date of hearing to be notified later.

At the outset, the judges found that Shaikh was absent during the hearing despite the issuance of a notice after the last hearing.

Taking serious exception to his attitude towards the court’s directive, the bench ordered the Axact CEO to appear in person on the next hearing.

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Shaikh’s lawyer, Shaukat Hayat, undertook to ensure compliance with the court’s directive.

Case history

The federal government had, through the Federal Investigation Authority (FIA), challenged an order passed by the District and Sessions Judge-V, Karachi on August 24, 2016, that acquitted Shaikh in a money laundering case.

The Axact CEO was accused of having illegally transferred Rs170.17 million to a Dubai-based firm, Chanda Exchange Company, in April 2014.

Chanda Exchange Company’s directors Mohammad Younis and Mohammad Junaid were named co-accused in the case, which was registered under Foreign Exchange Regulation Act, 1947 with First-Information Report (FIR) 51/15.

Sessions Judge Sohail Ahmed Leghari, after hearing arguments, discharged Shaikh from the case, saying the possibility of conviction was low.

But the FIA argued that after the completion of the investigation, a final charge-sheet was submitted on March 31, 2016, to the trial court, which had taken cognizance of the same and accepted the charge-sheet.

It was argued that due to the continued absence of the accused from the trial court and the failure of the jail authorities to produce him, charges could not be framed by the trial court and proceedings were being adjourned from time to time.

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Despite the fact that accused Shaikh was not produced on many hearings before the tribunal, his lawyer moved an application under Section 265-K of the Criminal Procedure Code, which was converted into an application under Section 249 CrPC on the date of hearing and at the time of arguments.

Therefore, the FIA pleaded that the court set aside the trial court’s acquittal order. It further requested that the accused may be convicted or the case may be remanded back to the trial court for recording all prosecution evidence afresh.

Earlier, the Supreme Court, while hearing a suo motu case regarding the Axact fake degree scam, had directed the Islamabad High Court and the Sindh High Court (SHC) to decide all the matters relating to the company within 15 days.

The Axact scandal surfaced in May 2015 when The New York Times published a report that claimed the company sold fake diplomas and degrees online through hundreds of fictitious schools, making “tens of millions of dollars annually”.

Subsequently, the offices of Axact were sealed, its CEO and key officials were arrested and a probe was launched on the basis of the allegations.

Earlier, the SHC had in August 2016 granted bail to Shaikh and 13 others.