| Citation(s) |
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| 2025 SLG 3768 2025 SLD 3768 = 2025 CLD 689 |
Lahore High Court
Writ Petition No. 79375 of 2023 (and other connected petitions), heard on 21st January, 2025.
Before Shahid Karim, J
Petitioner by: Barrister Muhammad Umer Riaz, Saqib Haroon Chishti, Abdul Waheed, Muhammad Amin, Rana Rehan, Haseeb Tariq, Barrister Hassan Safdar Khan, Rashid Khan, Rana Muhammad Afzal Razzaq Khan, Sajid Asghar Langhra, Awais Toseef Rana, Faisal Anwar Minhas, Hafeez Ullah Maan, Asif Amin Goraya, Nazakat Abbas Bhatti and Muhammad Sohail Anjum.
Respondents by: Ahmed Pervaiz for SBP. Azmat H. Lodhi for FBL. Zahid Mahmood Arain for UBL. Muhammad Riaz for Bank Al-Falah. Kashif Hussain for Meezan Bank. Zameer ud Din Ibad for Sindh Bank. Mirza Abdul Basit for Soneri Bank. Asad Ali Bajwa, D.A.G with Muhammad Waqar Khalique, Law Officer, SBP.
Writ Petition No. 79375 of 2023 (and other connected petitions), heard on 21st January, 2025.
Before Shahid Karim, J
Petitioner by: Barrister Muhammad Umer Riaz, Saqib Haroon Chishti, Abdul Waheed, Muhammad Amin, Rana Rehan, Haseeb Tariq, Barrister Hassan Safdar Khan, Rashid Khan, Rana Muhammad Afzal Razzaq Khan, Sajid Asghar Langhra, Awais Toseef Rana, Faisal Anwar Minhas, Hafeez Ullah Maan, Asif Amin Goraya, Nazakat Abbas Bhatti and Muhammad Sohail Anjum.
Respondents by: Ahmed Pervaiz for SBP. Azmat H. Lodhi for FBL. Zahid Mahmood Arain for UBL. Muhammad Riaz for Bank Al-Falah. Kashif Hussain for Meezan Bank. Zameer ud Din Ibad for Sindh Bank. Mirza Abdul Basit for Soneri Bank. Asad Ali Bajwa, D.A.G with Muhammad Waqar Khalique, Law Officer, SBP.
Messrs MUMTAZ GHANI TEXTILE (PVT.) LTD. through Chief Financial Officer and others---Petitioners
VERSUS
FEDERATION OF PAKISTAN through Secretary, Ministry of Finance and 2 others---Respondents
Law: Foreign Exchange Regulation Act, 1947
Section: VII,3,12(1),12(3),20(3),23B,23J
Law: Constitution of Pakistan, 1973
Section: 9,10A,14,18
(a) Foreign Exchange Regulation Act (VII of 1947)-------Ss. 3, 12(1), 12(3), 23B & 23J---Constitution of Pakistan, Arts. 9, 10A, 14 & 18---Adjudicating Proceedings and Appeal Rules, 1988---State Bank Notification No.F.E.I/2002 dated 05.01.2022---Foreign Exchange Circular No.1 dated 13.02.2023---Foreign Exchange Circular No.2 dated 31.03.2023---Payment of exported goods---Delayed realization of export proceeds---Issuance of show cause notice by State Bank of Pakistan (SBP)---Lien on export proceeds---Adjudication process---Due process of law, violation of---Assumption of role of Adjudicating Officer by the SBP---Legality---Claim of the petitioner was that Circular No.2 of 2023 issued by SBP amending Foreign Exchange Manual by adding paragraph 33A was ultra vires and impinged on their rights to deal with their funds---Plea of the SBP was that as per Ss. 3, 12(3) & 20(3) of the Foreign Exchange Regulation Act, 1947 (Act) powers were vested with SBP to issue the circular---Validity---Section 20(3) of the Act merely grants power to SBP to give directions qua making of payment and doing of other acts, inter alia, by authorized dealers in the course of their business and these directions may be given as appears to SBP to be necessary or expedient for the purpose of securing compliance with the provisions of the Act--State Bank of Pakistan was not at all empowered to add anything or impose stricter conditions to the conditions already prescribed by Adjudication Proceedings and Appeal Rules, 1988 (Rules), and power to do so vested in the Adjudicating Officer upon a complaint being filed to him and that too at the conclusion of the hearing after following due process of law---State Bank of Pakistan had arrogated to itself the power vested in the Adjudicating Officer by virtue of S. 23J of Act regarding the recovery of sums due to the Government in execution of the orders passed by him---Circular No.2 condemned the authorized dealer unheard and was a pre-emptive order issued by use of SBP's dominant position as a regulator---Such act of SBP not only offended the provisions of the Act but also the constitutional rights enshrined in Arts.…