KHADIM HUSSAIN Versus STATE

ORDER

1. SARDAR MUHAMMAD ASHRAF KHAN, J .‑By this order we propose to dispose of Criminal Miscellaneous Petitions Nos. 20 and 21 of 1982 as in each of them the detention of the petitioners in civil prison has been challenged on the same grounds and thus, common question of law are involved therein for determination.

2. Ch. Khadim Hussain and Ch. Muhammad Abdullah, petitioners in the above petition: are detained in civil prison since 4th December, 1981, on the authority of warrants of arrest issued by the Registrar, Co operative Societies, Azad Jammu & Kashmir (hereinafter referred to as Registrar) in exercise of powers vested in him under section 8 of the Azad Jammu & Kashmir Co‑operative Banks (Repayment and Recovery of Loans) Ordinance (hareinafter called Ordinance), for their failure to furnish security for repayment of loans outstanding against them of the Kashmir National Co‑operative Bank Ltd., which now stands dissolved under the Establishment of the Federal Bank for Co‑operatives and Regulation of Co‑operative Banking Ordinance as adapted in Azad Jammu & Kashmir. Through these petitions in the nature of habeas corpus under section 491, Cr. P. C., the petitioners have sought their release from the aforesaid detention by challenging the same on the following grounds :‑

(1) That the petitioners were not served with mandatory notices under section 5 (2) of the Ordinance and, as such, their detention is not warranted by law.

(2) That the Registrar has not conducted the inquiry to determine .the liability of the petitioners as required by section 4 (2) of the Ordinance.

(3) That despite the fact that the petitioners are in Civil prison for the last 10 months, they have not been given an opportunity by the Registrar to place their case before him.

(4) That the amendment made in section 5 (2) of the Ordinance by which the word "May" has been substituted for the word "shall" is void on account of its inconsistency with the Fundamental Right of "Equality before Law".

3. Now, we proceed to take up the above grounds of attack on the validity of the detention of the petitioners seriatim, for consideration and decision thereon :‑

4. In support of the first ground mentioned above, it has been contended by the learned counsel for the petitioners that under section 5 (2) of the Ordinance, it was incumbent upon the Registrar to issue notices to the petitioners requiring them to repay and secure the loans standing against them of the aforesaid Co‑operative Bank before making any order of their detention but as the same were not issued, the detention of the petitioners is devoid of legal sanction behind them. In the alternative, it has also been contended by the learned counsel for the petitioners that even if the notices were issued to the petitioners by the Registrar, the same have not been served upon them in acccordance with law. In elaboration of this contention, it is contended that the notices alleged to have been issued by the Registrar, were not duly served on the petitioners as their substituted service was affected by affixing copies of the same on the outer doors of their houses which mode of service is not permissible under the Code of Civil Procedure as is applicable in matter of service of notices issued under the Ordinance. This argument has been built on the ground that under section 6 (a) of the Ordinance, the Registrar has been invested with the powers of a Civil Court under the Code of Civil Procedure, trying a suit in respect of the matter, namely, summoning and enforcing the attendance of any person and examining him on oath and thus, the substituted service by way of affixing a copy of summons on the conspicuous part of the house of the defendant can only be affected under Order V, rule 17, C. P. C. in a case where the defendant is not found at his ordinary place of residence and no authorised agent or male member of his family is available to accept the service of the summons. It is thus, contended that since the report of the Serving Officer made on the notices issued to the petitioners does not show that there was no authorised agent of the petitioners or any male member of their family available at the time of affecting the service by affixing copies of the notices on the outer doors of their houses to accept their service, the substituted service so effected cannot be treated as due service of the notices on the petitioners and, as such, it would be considered as if no notices were served on the petitioners.

5. After giving our due consideration to this contention of the learned counsel for the petitioners, and taking into consideration the facts of the case and relevant law, we are of the view that there is no force in this contention of the learned Counsel for the petitioners that notice in terms of section 5 (2) of the Ordinance was not issued to each of the petitioner or that notices issued to them were not served in accordance with the provisions of law thereby rendering their service ineffectual and of no legal consequence. As regards the point as to whether or not notices under consideration were issued to the petitioners; it is established from the record of the cases that the same were caused to be issued by the Registrar before their detention in Civil prison. In this respect we may refer to the Photostat copy of the notice issued by the Registrar to each of the petitioners and a copy of the proclamation published in the "Daily Nawa e‑Waqt", Rawalpindi, dated 1st November, 1981 placed on the record. The aforesaid notices and proclamation required the petitioners to repay and secure the loan obtained by them from the Kashmir National Co‑operative Bank (dissolved) within a period stipulated therein under the Ordinance, failing which action against them would be taken under law and, therefore, in presence of the aforesaid notices and proclamation it cannot be said that the Registrar failed to comply with the provisions of section 5 (2) of the Ordinance by not causing the notices to be issued to the petitioners requiring them to repay and secure the loan. The alternative argument of the learned counsel for the petitioners that notices issued by the Registrar were not duly served upon the petitioners in accordance with law, has also no substance in it. It is true that under section 6 (a) of the Ordinance, the Registrar has been invested in the matter of summoning and enforcing the attendance of any person and examining him on oath, with the same powers as are vested in a civil Court under the Code of Civil Procedure, when trying a suit. But the above provision of law, by no stretch of imagination, can be construed to be applicable to the notices issued under Section 5 (2) of the Ordinance. Before proceeding to discuss further this matter, it appears appropriate to reproduce the relevant portion of Section 6 of the Ordinance which reads as under :‑

6. Power of Registrar when making inquiry.‑The Registrar shall, for the purpose of making any inquiry under this Ordinance, have the same powers as are vested in a civil Court under the Code of Civil Procedure, 1908 when trying a suit, in respect of the following matters, namely :‑

(a) summoning and enforcing the attendance of any person and examining him on oath."

6. From the perusal of the above provisions of law, it becomes quite clear that clause (a) of section 6 comes into play only when the Registrar is making any inquiry under the Ordinance and not otherwise and thus in view of this legal petition, the aforesaid provisions are not attracted in the matter of effecting the service of notices issued under section 5 (2) of the Ordinance to borrowers. To us, clause (a) of section 6 of the Ordinance is only attracted when the inquiry by the Registrar is made either under clause (6) of subsection (2) of section 4 or under subsection (3) of Section 5 of the Ordinance and it has no application to the notices issued to the borrowers in terms of section 5 (2) of the Ordinance. The stage of making inquiry under section 5 (3)'of the Ordinance for the determination of the liability of the borrower. In the event of his denial of such liability, comes only after the notice to the borrower is issued and, therefore, the question of application of the provisions of clause (a) of section 6 of the Ordinance does not arise at all. It is also an arguable point as to whether the provision as to the summoning and enforcing the attendance of any person and examining him on oath also covers, the matters relating to service of the summons issued under the Ordinance but we need not examine and discuss this question in view of our above conclusion that the aforesaid provision is not applicable to the notices issued under section 5 (2) of the Ordinance. There is no specific provision made in the Ordinance for the mode of service to be adopted for the service of notice issued under Section 5 (2) of the Ordinance and in absence of any such provision, it cannot be said that substituted service of notice effected on the petitioners was not in accordance with law thereby rendering it uneffectual and unlawful.) The purpose of making provision for issuance of notices to the borrower under section 5 (2) of the Ordinance appears to be to inform him that the loan of the Co‑operative Bank (dissolved) is outstanding against him which he is to repay and secure the same in accordance with the provisions contained in section 5 (3) of the Ordinance or to deny his liability in which case an inquiry is to be held for the determination of his liability by the Registrar. In the instant cases, first the notices were issued to the petitioners requiring them to repay and secure the loan and their service was effected by affixing copies of the same on the outer doors of their houses as they were not found at their residence by the Process Server and later proclamation was also got published in the Daily Newspaper for the purpose and these two modes of service were sufficient to meet the requirements of section 5 (2) of the Ordinance and in the circumstances of the cases, we are satisfied that the service through the aforesaid methods was quite reasonable to make the petitioners aware of their liability of loan to the dissolved Co‑operative Bank and their obligation to furnish security for the repayment of the same as contemplated by section 3 (2) of the Ordinance. As the petitioners did not deny their liability, the question or its determination by the Registrar did not arise. It may not be out of place to mention here that the petitioners have not denied their liability of repaying loan to the dissolved Co‑operative Bank even in these petition3 nor they have placed any material on the record showing that they have not admitted such liability before the Registrar. For what has been stated above, we find no substance in this contention of the learned counsel for the petitioners and accordingly repel it.

7. In support of the next ground taken in the petitions, the learned counsel for the petitioners has contended that under section 4 (2) of the Ordinance it was obligatory on the Registrar to held an inquiry for the determination of the liability of the petitioners before making any order of their detention under section 8 of the Ordinance and, as such, this lapse on the part of the Registrar has rendered the detention of the petitioners unlawful. We find that this contention of the learned counsel for the petitioners is also devoid of any force. For the sake of facility of reference, section 4 of the Ordinance is reproduced as under :‑

8. "4 Recovery of loans.‑(I) If the amount of any loan or any part thereof to be repaid in accordance with the provisions of section 3, is not paid within the period or periods specified in the said section, the same may be recovered by the Registrar according to the law ‑and under the rules for the time being in force for the recovery of arrears of land revenue and while doing so he may exercise all or any of the powers of Collector under the Land Revenue Act and the Rules made thereunder.

(2) Whereas‑

(a) the borrower is a company, partnership or association of persons and the assets of such company, partnership or association are not sufficient to meet the total liability, including the loans payable under this Ordinance of such company, partnership or association;

(b) the borrower is an individual person and his assets are not sufficient to meet his total liability and the Registrar is of the opinion, after such enquiry as he may deem fit, to hold in the matter, that the loan has been appropriated by any director, shareholder, partner or member, as the case may be, of such company, partnership or association or any other person, in case of an individual borrower, by any other person than the borrower himself, the loan shall be recoverable from the person who has appropriated the loan as aforesaid and his assets as if the loan had been taken by him.

(3) The recovery under this section shall not save a borrower from any other means of recovery or punishment provided in this Ordinance or rules made thereunder or under any other law for the time being in force."

9. From the bare reading of the provisions of the section reproduced above, it becomes quite clear that under it, the Registrar has been conferred powers to realise the loans from the borrower of the Co‑operative Banks (dissolved) as arrears of land revenue exercising the powers of a Collector under the Land Revenue act and. while doing so, he can recover the loans obtained by a company, partnership or association of person, from any of its directors, shareholders, partners or members, as the case may be, and in case the borrower is an individual person, from a person other than the borrower if he, after such inquiry as he may deem fit in the matter, is of the opinion that the loan has been appropriated by any such director, shareholder, partner or a member or any other person, as the case may be. Even the inquiry referred to in clause (b) of subsection (2) of the aforesaid section has been left to the discretion of the Registrar and no specific method or procedure for its holding has been prescribed and thus, in this sense, the inquiry is also discriminatory in nature. This inquiry has a reference to the proceedings being taken by the Registrar for the recovery of loan from the borrower as arrears of land revenue in exercise of his power vested in him by section 4 (1) of the Ordinance and no such inquiry is compulsory to be made before making an order of detention of the borrowers under section 8 of the Ordinance. From the photostat copies of the warrants of arrest forming basis of detention of the petitioners in civil prison, it appears that the petitioners are detained for not securing the loan of the Kashmir National Co‑operative Bank (dissolved) taken by them in their personal capacity and, as such, it cannot be said that the loan, for non‑securing of which in terms of section 3 (2) of the Ordinance, the petitioners have been detained in civil prison, was borrowed by any company or corporation etc. in which case it was necessary to form opinion after holding some inquiry by the Registrar that the loans have been appropriated by the petitioners as Directors or partners of such company or corporation. Apart from the above legal position, the provision as to the holding of an inquiry in section 4 of the Ordinance, cannot be pressed into service in the cases in hand because application of the said Section is specifically excluded where recovery of the loan from the borrower is being made by any other means of recovery and punishment provided under the Ordinance or rules made thereunder or under any other law for the time F being in force. In these cases, as is evident from the record, the coercive measure for the recovery of loan borrowed by the petitioners from the aforesaid dissolved Bank has been resorted to by detaining them in civil prison and this action of the detaining authority comes within the ambit of provisions of Section 4 (2) of the Ordinance, thereby excluding the applicability of the aforesaid section regarding the inquiry to be held by the Registrar.

10. The next ground urged in support of the detention being illegal is to the effect that the petitioners have not been provided an opportunity by the Registrar to place their cases before him despite the fact that they are in confinement for a period of ten months. This ground was not pressed by the learned counsel for the petitioners and rightly so because there is nothing in the relevant law requiring the Ragistrar to provide any such opportunity to the petitioners during their detention and there is nothing to prevent them to make any representation to the Registrar in this matter through the Incharge of the place where they are detained. As a matter of fact, Section 4 (3) enables the petitioners to make any representation in respect of liability of loan alleged to be outstanding against them if so allowed by the Registrar, in which case inquiry as to their liability of loan to the dissolved Co‑operative Bank shall be held by the Registrar but as stated earlier, there is nothing on the record to show that the petitioners did not admit their liability of loan of the said Bank.

11. The last ground taken in the petitions that the detention of the petitioners is unlawful because the amendment in section 5 (2) of the Ordinance by which word "May" has been substituted for the word shall", offends against the fundamental right of equality before law, is clearly without any substance. We fail to see how this amendment in any way is inconsistent with the fundamental right enshrined under Section 15 of the Azad Jammu & Kashmir Interim Constitution Act, 1974, providing that all the citizens would be equal before law. By this amend ment no discrimination has been made between a class of citizens, namely,. borrowers of the Co‑operative Banks (dissolved) and this amended section is equally applicable to all of them. However, this ground is not available to the petitioners because here the question of not issuing notices to the petitioners requiring them to repay and secure the loan is not involved as the same were already held to have been given to them while discussing this point somewhere in earlier part of this judgment.

12. For the foregoing reasons, we do not find the detention of the petitioners in civil prison and challenged in these petitions, without any legal justification which, in our view, is perfectly in accordance with and under the authority of law, for the Registrar had the powers to detain them in Civil prison for their failure to furnish security for payment of loan outstanding against them of the dissolved Kashmir National Co‑operation Bank, in exercise of the powers conferred upon him under section 8 of the Ordinance. We accordingly dismiss these petitions.

13. Petition dismissed