Nonpayment vitiates VR facility of NAB: SC

Says graft buster can’t recover amount determined in VR settlement as arrears of land revenue

ISLAMABAD: Explaining a key provision of the law governing the top accountability watchdog – the National Accountability Bureau (NAB) – the apex court has declared that a failure to deposit the required amount under NAB voluntary return (VR) facility vitiates settlement of an accused.

The VR is an option available to a person who is facing a NAB inquiry or fears such inquiry. The VR allows such an individual to come forward – prior to authorization of an investigation against him – to “discharge his liability” by making a voluntary return of the amount due against him.

A three-judge bench, comprising Justice Mushir Alam, Justice Mazhar Alam Miakhel and Justice Mansoor Ali Shah, has interpreted sections 25(a) and 33E of the National Accountability Ordinance (NAO) 1999 that respectively talk about the VR and recovery of fine as arrears of land revenue.

Explaining the provision, the judgment written by Justice Shah said a VR settlement is structured around and dependent upon the volition of the person who wishes to settle.

“The VR, therefore, constitutes (i) an offer of a holder of public office or any other person to make a voluntary return of the assets acquired or gained made by him in the course, or as a consequence, of any offence under the Ordinance; (ii) acceptance of that offer by the NAB chairman; (iii) determination of the amount due from such person by NAB chairman NAB; and (iv) deposit by such person with the NAB, of the amount so determined.”

The court said anything short of this does not constitute a valid VR settlement.

“The VR is, therefore, a one-off voluntary return facility linked with the liability of the accused as determined by NAB chairman. Being a voluntary payment, any failure thereof, simple puts an end to the facility of the VR”.

It said any short payment or partial payment does not constitute a valid VR settlement and thus does not discharge the person from his liability in respect of the matter or transaction in issue and the proceeding initiated under the Ordinance continues unabated. The judgment said that VR under the law is a one-time facility of depositing the determined amount and not a long-term repayment arrangement.

“Default in deposit of the amount under a VR settlement vitiates the settlement resulting in initiation of further proceeding by NAB against the accused under the ordinance…

“And NAB cannot recourse to section 33E of the ordinance to recover the amount determined in the VR settlement as arrears of land revenue,” the verdict added. The court noted that though constitutionality of section 25(a) is sub judice in other case but it would confine itself to the meaning and scope of VR.

It said in case NAB grants time to a person to arrange for money so as to discharge his liability under the VR settlement, any such concession extended to the accused has no bearing on the essential constituent of the VR, ie, the deposit of the determined amount.”

The judgment said the VR facility becomes effective once the entire determined amount is paid or else the facility comes to an end. Even if the accused is allowed to pay the amount in installments, the VR will only be effective once the determined amount is deposited in full.

“The VR envisages a voluntary deposit against the liability and there is no concept of any outstanding amount. ‘Outstanding amount’ or ‘any sum due’ imply that a person is otherwise bound to pay and hasn’t paid.”

The court said under the VR, there is either a deposit of the determined amount voluntarily or there is no VR. Therefore, the question of the recovery of the outstanding amount under VR does not arise in order to attract section 33E of the Ordinance.

However, any partial payment under the VR will be available for adjustment even after the VR stands vitiated and can be adjusted against Please Bargain (PB) or the liability determined by the court, as the case may be.

“VR is linked with the condition of full deposit whereas the PB becomes operative if the accused “agrees to return” to the NAB the amount determined by NAB chairman and the court approves such agreement.

“The amount so agreed to be returned under clause (b) becomes due under the Ordinance and is thus recoverable as arrears of land revenue under section 33E of the Ordinance” it added.