SUO MOTU ACTION TAKEN UP IN COURT: In the matter of vs NOT
This matter arose from a suo motu action concerning the widespread practice of Pakistani citizens maintaining undisclosed foreign bank accounts and assets, potentially representing ill-gotten gains, kickbacks, or tax evasion, which the Court observed causes significant economic disparity and constitutes a plunder of national wealth. The core legal question addressed was the Court's authority to intervene in matters of public importance involving the potential violation of citizens' fundamental rights due to the siphoning of national wealth abroad. Exercising its jurisdiction under Article 184(3) of the Constitution, the Court held that the failure to address the illicit transfer of wealth and the lack of progress regarding disclosures in the Panama and Paradise Papers warranted judicial oversight. The Court directed the State Bank of Pakistan, the Federal Board of Revenue, the Securities and Exchange Commission of Pakistan, and various intelligence and investigative agencies to collaborate, retrieve information through diplomatic and legal channels, and submit comprehensive reports on actions taken to identify and recover such assets. The holding emphasizes that the state has a duty to protect national resources for public welfare.
- Does the maintenance of undisclosed foreign accounts by citizens, potentially involving ill-gotten gains, constitute a matter of public importance justifying the invocation of Article 184(3) of the Constitution?
- Can the Supreme Court direct state institutions to collaborate and retrieve information from foreign jurisdictions regarding undisclosed assets held by Pakistani citizens?
- Article 184(3), Constitution of the Islamic Republic of Pakistan 1973
ORDER
It has been common knowledge for years that a large number of Pakistani citizens, who are residents of Pakistan and are maintaining accounts in foreign countries without disclosing the same to the authorities competent under the Laws of Pakistan or paying taxes on the same in accordance with law. Prima facie, it appears that such money is siphoned off without the payment of taxes through illegal channels and represents either ill-gotten gains or kickbacks from public contracts. Such money creates gross disproportion, inequality and disparity in the society, which warps economic activity and growth, and constitutes plunder and theft of national wealth.
2. Recently, the names of a large number of Pakistani citizens were disclosed in the Panama Papers and Paradise Papers. The Chairman, Federal Board of Revenue (FBR) had appeared before the Court and made a statement that appropriate action was being initiated against the citizens whose names had appeared in above said papers. However, no appreciable progress appears to have been made in this regard. The society and economy of the country is being bled by illegal and surreptitious theft of national wealth, which is stashed in foreign countries, the same could otherwise be utilized for the welfare of the people in projects such as education, health and public welfare. Such delinquency constitutes violation of the fundamental rights of the citizens of Pakistan and is a matter of great public importance.
3. Therefore, in exercise of powers under Article 184(3) of the Constitution of the Islamic Republic of Pakistan, 1973, we direct as follows: i) The State Bank of Pakistan shall before the next date of hearing submit a comprehensive report regarding steps which have been taken under the International agreements/treaties/ protocols to identify the citizens who hold accounts in foreign jurisdictions including UAE, Switzerland, Luxemburg, Spain, UK, etc. and other tax haven jurisdictions, including, British Virgin Islands, Cayman Islands, Channel Islands, etc. ii) The State Bank of Pakistan, the FBR, the Securities and Exchange Commission of Pakistan and the Ministry of Finance I shall submit report'about the steps taken, in collaboration with other State institutions, for retrieval of the said money. iii) The Federal Board of Revenue shall also submit a report providing details of the steps taken on the basis of information available, inter alia, through Panama Papers and Paradise Papers and the action taken against citizens holding properties and banks accounts in foreign countries. iv) All State agencies including IB, ISI, MI and FIA are directed to share all requisite information available with them with this Court. v) The State Bank of Pakistan, FBR, the Ministry of Finance and Ministry of Foreign Affairs shall collaborate with each other, collect and share information and approach the afore-noted foreign jurisdictions to obtain such/other further information, as may be necessary, through legal and diplomatic channels.
4. Let responsible officers, conversant with the necessary facts appear before this Court on 15.02.2018.