SC says beneficiary of property cannot become its owner

–Three-member bench says avoiding tax through legal means is not considered dishonesty

–Abbasi’s lawyer alleges Tareen submitted fake documents in court, repeatedly changed stance

ISLAMABAD: The Supreme Court (SC) observed on Wednesday that a beneficiary of some property cannot become its owner, as it sought an explanation whether Pakistan Tehreek-e-Insaf (PTI) Secretary General Jahangir Tareen was required to disclose the trust property under the law.

The three-member bench headed by Chief Justice Saqib Nisar and comprising Justice Umar Ata Bandial and Justice Faisal Arab gave this observation as it continued hearing of a petition filed by Pakistan Muslim League-Nawaz (PML-N) leader Hanif Abbasi seeking the disqualification of PTI Chairman Imran Khan and Jahangir Tareen over the alleged non-disclosure of assets, existence of offshore companies, as well as receiving foreign funding for their party.

CJP Nisar, while referring to the Panama Papers verdict, observed that the main issue in the case was the source of money which was used to purchase the UK properties. According to the trust deed present in the court, Tareen is discretionary lifetime beneficiary of his UK properties.

The three-judge bench also maintained that avoidance of tax through legal means is not considered dishonesty. On this, Abbasi’s lawyer Azid Nafees said that the court, while deciding the issue of honesty, should examine the conduct of the candidate.

Nafees alleged that the documents submitted by Tareen in the court concerning 18,500 acres of contracted land were forged. He argued that the PTI leader has adopted varying positions regarding the aggregate agricultural income he declared in his 2013 nomination papers.

The lawyer said that, in a written response submitted before the court, the PTI leader adopted the stance that he was not liable to pay tax on the contracted land. Later, the position was adopted that there was no column on the nomination papers for Tareen to declare the income he earned from the land.

“The documents regarding the contract are fake,” the lawyer alleged.

“Jahangir Tareen did not pay any tax on his agricultural income,” the lawyer further told the court, adding that the leased land is not registered with the Department of Finance.

“Registering the land was the land owner’s responsibility,” Justice Arab said.

“If Tareen was paying such a large sum for the land, he should have had it registered,” the lawyer argued.

“We will have to see if the documents presented by Tareen prove dishonesty,” the chief justice said.

TRUST DEED:

Completing his arguments regarding the contracted land, Abbasi’s lawyer shifted his attention to a trust through which Tareen had bought property in Britain.

The lawyer recalled that Tareen, in a response submitted to the court earlier, had said that his children are the actual beneficiaries of the trust, not him. However, the lawyer argued, according to the trust deed submitted before the court, Tareen is the beneficiary of the trust, along with his wife and children.

The lawyer further argued that the trust was established to conceal the ownership of property.

“Are you trying to say that Tareen should have declared the trust in his nomination papers?” the chief justice asked. “The property bought through the trust belongs to the trust,” he said.

He added that Tareen, as the settler of the trust, could not have been the owner of the property.

“The trust is a legal entity, the property bought through the trust will belong to the trust,” the chief justice said.

When the lawyer told the court that Tareen was required to declare his assets in the nomination papers, the chief justice told him that the trust is not an asset.

“The trust was established in a legal way, where is the dishonesty?” the chief justice asked.

Advocate Nafees then reminded the court that in the Panama Papers case ─ in which former prime minister Nawaz Sharif was disqualified ─ the court had to look at the facts to determine whether the lawmaker was Sadiq and Ameen as per Article 62 and 63 of the Constitution. He added that in the present case, the court has to look for dishonesty in a lawmaker’s conduct, not intention.

To this, Justice Umar Bandial observed that two judges in the Panama Papers case had observed that there must be violation of law for the disqualification of a MNA under Article 62 (1) of the Constitution because it will be considered as a life-time disqualification.

He also said that review petition judgement has drawn a distinction between disqualification under election laws and Article 62 (1) of the Constitution.

After Nafees completed his arguments, Tareen’s lawyer Sikandar Mohmand told the court that his client is not the beneficial owner of the trust.

“Being a beneficiary does not prove that one is the beneficial owner,” the chief justice agreed.

“The owner of the trust’s funds is the trust,” Mohmand said.

“There is hope of receiving something from a trust. There is no column in the nomination to declare what is expected,” the lawyer argued.

The hearing was then adjourned until Thursday.