MUHAMMAD SALEEM vs THE STATE BANK OF PAKISTAN AND ANOTHER

This appeal has been filed against judgment, dated 3rd September, 1981 of Sessions Judge, Karachi/F. E. R. Tribunal in Case No, 8 of 1981, whereby he convicted the appellant under section 9/23 of Foreign Exchange Regulation Act, 1947, and sentenced him to suffer R. I. For three months.

2. The brief facts of the prosecution case are that on 12th October, 1980, Sirajuddin Ahmed, was posted as Inspector with F. I. A. Police in State Bank Circle, Karachi. He received an information that some people were in possession of foreign currency. He alongwith his subordinate staff came at footpath near Old Building of State Bank of Pakistan, Boulton Market, Karachi, and in presence of mashirs Anwar Ali and Muhammad Hassan, caught hold of the present appellant Muhammad Saleem and searched his person. He recovered 1,117 Saudi Riyals and prepared mashirnama. He then lodged complaint under section 9/23 of the Foreign Exchange Regulation Act, 1947. The appellant was challaned on 21st January, 1981. The charge under section 9 read with section 23 of Foreign Exchange Regulation Act, 1947, was framed and he pleaded not guilty and case proceeded.

3. The prosecution examined Anwar Ali mashir, Exh. 3, and complainant Sirajuddin Ahmed, Exh.

6. The appellant produced no witness in his defence. P. W. 2 Sirajuddin, Inspector, stated the same facts as mentioned in the F. I. R., and deposed that he secured 1,117 Saudi Riyals from appellant. P. W.

1 Anwar Ali has stated that he was doing business of selling of opticals at Boulton Market, Karachi, when on 12th January, 1981 at about 12-00 noon, he was going from his shop to post office, one Police Officer asked him to act as mashir. He accompanied the Police Officer and on the -footpath he saw the present appellant was holding some foreign currency and was talking to some persons.

The police called another mashir and in their presence police recovered/secured 1,117 Saudi Riyals.

He has supported the prosecution case. The appellant has not proved any kind of enmity with mashir and Sirajuddin Ahmed.

4. Mr. Diwan Bashir Ahmed, the learned counsel for the appellant, has contended that appellant has wrongly been challaned under section 9 of the Foreign Exchange Regulation Act, 1947, because the appellant is not an authorised agent and such his conviction is bad in law.

5. Mr. Rasheed Qureshi, the learned counsel for the State, has argued that the case has been proved by the prosecution beyond the reasonable doubt. The respondent was caught on the spot with foreign currency. He states that the appellant can be convicted under section 4 of the Foreign Exchange Regulation Act, 1947.

6. The charge against the appellant has been framed as under :- "That you, on or about the 12th day of October, 1980, at footpath of Old State Bank of Pakistan Building, Karachi, were found in possession and holding 1,117 Saudi Riyals without any lawful authority."

There is no allegation that he was found selling foreign currency. The evidence against his is that he was found in possession of foreign currency. According to F. I. R. The Inspector of Police/complainant, received an information that the appellant was selling foreign currency illegally but there is no evidence to this effect that he was actually selling foreign currency. The complainant in his evidence has stated that he suspected the appellant to be in possession of foreign currency and on search he recovered 1,117 Saudi Riyals from his possession and then arrested him. Mashir was also stated that appellant caught hold by the police and on the search of his person recovered foreign currency. Section 9 of the Foreign Exchange Regulation Act, 1947, is reproduced which reads as under :- "The Central Government may, by notification in the official Gazette, order every person in, or resident in Pakistan.

(a) Who owns such foreign exchange as may be specified in the notification, to offer it, cause it to be offered for sale to State Bank on behalf of the Central Government or to such person, the State Bank may authorise for the purpose, at such price as the Central Government may fix, being a price which is in the opinion of the Central Government not less than the market rate of the foreign exchange when it is offered for sale.

(b) Who is entitled to assign any right to receive such foreign exchange as may be specified in the notification, to transfer the right to the State Bank on behalf of the Central Government on payment of such consideration, therefore, as the Central Government may fix : Provided that the Central Government may by notification or another order exempt any persons or class of persons from the operation of such order : Provided further that nothing in this section shall apply to any foreign exchange acquired by a person from an authorised dealer and retained by him with the permission of the State Bank for any purpose'."

The appellant cannot be charged under section 9 of the above Act as ingredients of section 9 are missing in the charge. There is no evidence to the effect that he was authorised by a notification to deal with the foreign currency. At the best he could have been charged under section 4 which provides that no person other than unauthorised dealer shall in Pakistan and no person resident of Pakistan other than an unauthorised dealer all outside Pakistan buy or borrow from or sell or lend to, or exchange with, any person not being unauthorised dealer, any foreign exchange. But in the present case no such charge has been made against the present appellant. I refer to a case of Jalil v. The State in which it has been held that mere possession of foreign exchange by itself constitutes no offence within the meaning of section 4 of the Act but prosecution is bound to prove for conviction under section 9 that accused after becoming owner of foreign exchange, failed to offer prepare, same for sell within one month from his acquisition as required under notification.1

7. In view of the above circumstances, prosecution has failed to prove the case. Upshot of the above discussion is that appeal is accepted and impugned judgment is set aside. The appellant is acquitted and his bail bon stands discharged. 1978 P Cr. L J 155