The Sindh High Court (SHC) has dismissed the appeal of a businessman, Mian Waqar Akhtar Paganwala, in loan default case. The appellant, the managing director of a milk processing plant Mass Dairies, was sentenced to seven-year imprisonment with a fine of Rs50 million by an accountability court on March 13, 2001.
According to the prosecution, the former management of the milk processing plant had obtained Rs29 million loan from the Agriculture Development Bank in 1981 for the import of machinery costing Rs26 million and purchase of local machinery worth Rs3 million.
The company was later transferred to Akhtar and other directors with liabilities of Rs37 million and it was alleged that at the time of the transfer of the project to the new management, an amount of Rs37.1 million was outstanding against the said company which the new management had accepted by taking over the project with the acceptance of all the liabilities/terms and conditions from the previous management.
According to the prosecution, the new management successfully operated the project from 1986 to 1987 but failed to repay the loan. The NAB reference alleged that the project had been closed and was in the custody of Akhtar and others and an amount of Rs.200.970 million was outstanding which they had failed to repay despite demand notices, and committed loan default.
The appellant’s counsel submitted that Akhtar was innocent and had committed no offence as he had not received any amount from the bank but the loan was obtained by the previous owners of the plant and the appellant not entered into any agreement with the bank.
He submitted that the loan was not utilised by the appellant and it was a case of simple default and did not fall in the definition of wilful default as it could not be repaid due to the reason that the unit could not run properly.
A NAB special prosecutor submitted that the prosecution had proved its case against the appellant beyond reasonable doubt by producing reliable, trustworthy and confidence-inspiring evidence that the loan was admitted by the appellant and was obtained by the previous owner for which the appellant took all the liabilities including the loan and signed his personal guarantee with the bank.
He submitted that it was also admitted by the appellant that he did not repay the loan to the bank and the reason given by the appellant for not repaying the loan was not satisfactory and no evidence in support of his defence was produced.
He submitted that the trial court passed a well-reasoned judgment besides a suit filed by the bank was also decreed in favour of the bank. The NAB official requested the high court to dismiss the appeal.
A division bench of the SHC headed by Justice Mohammad Karim Khan Agha after hearing the case observed that the prosecution had proved the case against the appellant beyond a reasonable doubt by producing reliable, trustworthy, and confidence-inspiring evidence. The court uphold the conviction of the appellant and dismissed the appeal.