The Lahore High Court (LHC) on Thursday declared the notices sent by the Joint Investigation Committee and Federal Investigation Agency (FIA) to the Sharif family's Al-Arabia Sugar Mills and Jahangir Tareen's JDW Sugar Mills null and void.
The two-member LHC bench comprising Justice Shahid Karim and Justice Sajid Mehmood Sethi temporarily accepted the sugar mills' appeals while announcing the reserved verdict.
The court also quashed the notices sent to the sugar mills by the Securities Exchange Commission of Pakistan (SECP).
The two-member bench observed in its ruling that the SECP failed to play its role in accordance with the law. The ruling further maintained that the FIA had the right to conduct an inquiry but the laws under which the inquiry can be conducted have to be ascertained.
The court observed that it will elaborate on the FIA's powers in the detailed order that it will issue.
The petitioners had maintained in their appeals that the FIA did not have the power to conduct such inquiries. Their counsels, Salman Akram Raja and Salman Aslam Butt, told the court that the federal government constituted an inquiry commission to probe the sugar crisis on March 16.
The commission levelled baseless allegations of committing 'corporate fraud' on the Sharif family and Jahangar Tareen's sugar mills, the counsels argued. According to the petitioners' lawyers, the federal cabinet's directive to take action against the mills was unlawful.
In their appeals, the petitioners had requested the court to declare the JIT's notice seeking records from the Al-Arabia Sugar Mills as null and void.
They had further prayed to the court to also declare unlawful, and consequently null and void, the federal government's directives to the commission to conduct an inquiry against the Al-Arabia Sugar Mills and Faruqi Pulp Mills.
The court was also asked to have the show cause notices issued to the mills retracted and bar the commission from harassing them.
The LHC had earlier reserved the ruling in the case after listening to all the arguments, and today, temporarily accepted the petitioners' appeals while announcing the verdict.
On October 23, it was reported that an official inquiry report had revealed that the Pakistan Sugar Mills Association – the representative body of the sugar barons, is prima facie a “cartel” that manipulated the recent price hike with active coordination of a senior officer of JDW Sugar Mills Group, owned by Jahangir Khan Tareen.
The Competition Commission of Pakistan (CCP) – the entity responsible for ensuring fair play in the market, concluded a 10-month long inquiry and unearthed that the PSMA was indulged in illegal activities, according to a briefing by the CCP and its official inquiry report.
The findings also showed that the millers managed a decision to influence the PTI government to allow export of 1.1 million tons of sugar, that also caused a 48% increase in its prices.
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