Supreme Court vacates SHC's stay order on sugar inquiry

The apex court on Tuesday vacated a Sindh High Court (SHC) stay order as it allowed the government agencies to take action against sugar barons on basis of the reports of a sugar inquiry commission.

A three-judge bench, headed by Chief Justice of Pakistan Gulzar Ahmed, issued the order while hearing a federal government appeal filed against the SHC’s interim order which on June 24 restrained authorities from taking action against around 20 sugar mills of Sindh in light of the commission’s reports.

The Supreme Court bench, however, asked federal authorities not to take any unnecessary coercive action against sugar mill owners. It also directed the SHC and the Islamabad High Court (IHC) benches to decide the sugar mill owners’ petitions against the sugar inquiry commission within three weeks.

The sugar inquiry commission – headed by the Federal Investigation Agency (FIA) chief – was formed to probe into a sudden shortage of sugar that resulted in a steep hike in its prices in January this year.

In its preliminary report – unveiled on April 5 – the commission had claimed that sugar mills belonging to the families of the country’s top politicians including PML-N’s Shehbaz Sharif, PTI’s Jahangir Tareen and Khusro Bakhtiar, PML-Q’s Moonis Elahi and PPP’s Asif Ali Zardari were among beneficiaries of the crisis.

In its forensic report – issued on May 21 – the commission had accused the sugar mill owners of earning illegal profits to the tune of billions of rupees through unjustified price hikes, benami transactions, tax evasion, misuse of subsidy and purchasing sugarcane off the books.

The Pakistan Sugar Mills Association (PSMA) and 17 other petitioners challenged the commission and its reports in the IHC, whose single bench comprising Chief Justice Athar Minallah on June 20 disposed of the petition and declared that the inquiry commission was legal.

Sugar mill owners later moved an intra-court appeal in the IHC against its June 20 order and an IHC division bench is now hearing their appeal.

The sugar mills of Sindh had also moved the SHC against the commission which on June 24 stopped government authorities from launching a crackdown against 20 mills in the province.

The federal government later filed an appeal against the order in Supreme Court.

At the last hearing of the case on July 3, the SC bench had refused to stay the SHC order but on Tuesday it observed as to how the government could be stopped from working

During the proceedings, counsels for sugar mills alleged that the government representatives smeared reputation of people associated with the sugar industry through press conferences. The court directed authorities not to give public statements.

However, the chief justice noted that rhetoric is a political issue and could not be much interfered with. The Attorney General for Pakistan Khalid Javed Khan said this was the first commission before which two chief ministers and the closest aide of the prime minister appeared.

The AGP asked as to why action could not be taken against 20 sugar mills of Sindh.

Advocate Makhdoom Ali Khan, counsel for sugar mill owners, said if the SHC stay order was vacated, the case proceedings at the IHC and the SHC would be affected.

Justice Ijazul Ahsan, a member of the bench, noted that there should be a transparent investigation so that those involved could be punished. “Public interest would not be compromised,” he added.

The AGP gave a voluntary undertaking that no unnecessary coercive action would be taken against the sugar mills. He said the government is also setting up a commission on a petroleum crisis.

He said the government wants to resolve stay order issues on sugar inquiry before formation of the commission on petroleum shortage. The court later vacated the SHC stay order. It will issue a detailed judgment later.

The IHC on Monday issued its detailed verdict on sugar inquiry commission and ruled that the commission of inquiry had indeed “acted fairly” and had made the report “with courage and frankness”.