ISLAMABAD – A two-member Supreme Court bench headed by Chief Justice Iftikhar Muhammad Chaudhry will resume hearing today (Monday) on a suo motu case against Rs 256 billion loans illegally written off between 1971 and 2009.
The bench will examine a report submitted by Punjab Advocate General (AG) Khawaja Haris Ahmad on Saturday, which recommended the Supreme Court to direct National Accountability Bureau (NAB) to recover the illegally waived off loans.
AG Punjab, who was deputed as amicus curia by the apex court in the suo motu case against Rs 256 billion loans written off illegally, has suggested the apex court in his report to first give an opportunity to the borrowers and those found involved, to reimburse the amount waived off illegally to the concerned banks and where the concerned borrowers refuse to cooperate, direct NAB to file references against them after ascertaining who the defaulters are.
In his report he said all the officials who by waiving off loans, had violated the condition stipulated in Circular 29 of State Bank of Pakistan (SBP), should be referred to NAB, where it should be found that loan advanced to the borrower was not adequately secured. “Officials of the bank who were instrumental in providing loans to the borrowers without adequate security should also be proceeded against,” he suggested.
He said that it was the SBP which ultimately decided whether waiving off such loans was legal or such practice was detrimental to the public interest or to the interest of the depositors. “SBP can take action for removal of the directors and other officials of the banking company under Section 41-A,” he stated. He said that it was not correct that SBP could only lay down guidelines for standardising the process of waiving off loans in the country.
“In fact, the SBP has the power and authority to ensure not only that such guidelines are implemented in letter and spirit, but also to ensure independently of such guidelines that any write offs of loans affected by the banking companies is detrimental to public interest or to the interest of depositors and where it is found any irregularities, the SBP can take action against the directors and chief executives and other officers of the banking companies”, he said.
