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September 20, 2020

SHC recalls pre-arrest bail of private builders in housing society fraud case


September 20, 2020

The Sindh High Court has recalled pre-arrest bail of four director of a private construction company and two others in a housing society fraud case.

Petitioners Hameedullah Khan, Zulfiqar Ali Mirani, Shafqat Ali Shah, Mohammad Luqman, Kauar Jabeen and Mumtaz Hussain sought confirmation of their pre-arrest bail in the NAB reference pertaining to cheating public at large.

NAB alleged that M/s. Shah Mirani Associates directors cheated cheating public at large in the name of housing society, namely Baitul-Noor Houses. According to the prosecution, petitioners being directors of M/s. Shah Mirani Associates entered into an agreement on April 21, 2012, to purchase the land from a private person by making a partial payment. It alleged that the owner signed a general power of attorney in favour of the builders; however, the power of attorney was not registered with the sub-registrar and the title of the land was agreed to be transferred after receiving the complete payment from the builders.

NAB alleged that the private builders in connivance with the land owners enticed the general public to invest in their housing project, namely Bait-Ul-Noor Houses, and sold the plots without having an NOC for sale and title documents of the subject land. It further alleged that a large number of people invested in the project and paid an approximate amount of Rs123.025 million to the builders, including the cost of plots and development charges, but the builders had not provided them any kind of ownership documents and had cheated the public at large.

It was further alleged in the reference that the allottees, who made full payments of their plots to the builders, demanded title documents, but the builders neither had title documents nor NOC for sale and in order to avoid the wrath of the allottees they gave physical possession of the plots to the allottees and thereafter the allottees built their houses on the respective plots without having title documents and started living there without the provision of basic necessities of life. NAB alleged that accused persons also encroached upon extra three acres of land with the active connivance of the owner accused and sold the same to members of the public without having approved a layout plan from the SBCA, which subsequently issued notices to the allottees.

The bureau alleged that the builders also violated the revised layout plan and illegality developed plots in a vacant area and amenity plots; besides, these plots were sold to the general public which was also a sheer violation of the layout plan. It was further alleged that the evidence collected during the inquiry and the investigation established that the private builder being directors in connivance with the owners had cheated the public at large in the name of a housing project. The builders with the collusion and involvement of the owner and her husband dishonestly and fraudulently deceived the general public and committed offences under section 9(a)(ix)(x)&(xii), punishable under section 10 of the National Accountability Ordinance, 1999, NAB alleged in the reference.

The petitioners’ counsel contended that the petitioners started the project and after the payments by the allottees gave them the possession. They submitted that it was settled between the petitioners and the owners that the petitioners would sell the plots and the sale deeds were to be executed by the owners.

They said that the petitioners only sold the plots and about 80 per cent of sale deeds were also executed in favour of the allottees and the same were pending before the sub-registrar. The counsel for the builders submitted that the petitioners were not at fault, but the owners and the Pakistan Telecommunication Limited filed civil suits respectively and obtained a restraining order from the court; therefore, the sale deeds were not finalised.

They said that the NOC for the sale was also issued but the same was subsequently cancelled. They requested the court to confirmed the pre-arrest bail of the petitioners.

The counsel for the private builder, Mohammad Luqman, contended that he was a sleeping partner in the project who had earlier invested an amount of Rs2 million and received only Rs1.5 million from the project. He said that the petitioner was expelled by the other partners from the partnership to which he filed a lawsuit in the court and obtained status quo order in his favour.

He said that the petitioner did not sell out any plot nor was he the beneficiary of the scam and being a sleeping partner had no idea of what the other partners were up to.

The counsel for the owners contended that they were the real owners of the land and they sold out the land to the private builders who launched the housing scheme on it. They said that the petitioners did not sell out any plot nor received any amount from the allottees; besides, the private builders had not paid them the entire amount though they received the same from the allottees and that was why they had a dispute with them.

They said that they were ready to execute all the sale deeds in favour of the allottees if the private builders paid them the entire amount which they owed to them.

The special prosecutor of NAB contended that all the petitioners in connivance with each other cheated about 125 allottees and they received the entire amounts from the allottees but did not hand over the title documents to them. He submitted that the Sindh Building Control Authority also issued notices to the allottees and they were suffering due to such cheating. He said the petitioners created a dispute only to cheat the allottees as they were in connivance with each other and filed cases in order to prevent the handing over of the title deeds to the allottees.

A division bench headed by Justice Mohammad Karim Khan Agha observed that it is admitted position that the title of the land where the housing scheme was launched by the accused persons was under dispute with the PTCL and cases are still pending before competent courts of law despite which the petitioners in collusion with each other by making different agreements between themselves sold out the plots to the different allottees and have not handed over the title documents to the allottees.

The court observed that allottees are facing difficulties in getting the necessities of life and are fearful of being evicted and losing their entire investments as they have no evidence of their title.

The court observed that no mala fide on the part of NAB officials have been pointed out by the petitioners’ counsel nor has the court seen any from the record.

It said that it is a well-settled principle of law that pre-arrest bail is an extraordinary relief and is only available in cases where there has been mala fide on the part of the complainant or the investigating agency.

The court observed that a cursory glance of the record shows that all the petitioners in connivance with each other have cheated the allottees after taking a huge amount from them and have deprived them of their right of ownership and title; therefore, the interim pre-arrest bail granted to all the petitioners is recalled with respect to each and each one of the petitioners with immediate effect.