Pay illegally waived loans or face consequences, warns SC

islamabad — The Supreme Court has given last warning to the companies and individuals, accused of having billions of rupees worth of loans written-off illegally, to return the money or face consequences.

A three-member bench headed by the Chief Justice of Pakistan, Mian Saqib Nisar, was hearing a suo motu case against illegal waivers of bank loans by influential persons and companies.

During the hearing, the chief justice remarked: “The nation was burdened with huge debt. They had no right to occupy the office if they failed to bring back the nation’s wealth”.

Additional attorney-general (AAG) informed the bench that out of 222, only 39 persons had availed the apex court’s offer and deposited back the written-off amount to the national kitty.

The chief justice observed that those who did not avail the opportunity would regret as the court would take strict action against them.

The apex court had earlier given options to the companies and individuals to return only 75 per cent of the outstanding loans while waiving interest as per a formula suggested by Justice Muneeb Akhtar, or contest their cases in banking courts. The CJP said that in case the banking courts gave verdicts against the companies, they would have to pay the full amount of their loans and in case of failure to do so, they could go to jail.

The CJP while giving the eight weeks to the respondents to repay their loans, adjourned the case for an indefinite period. Neither banks nor any financial department had claimed the written off loans, therefore, the amounts would be deposited in the dams fund, the CJP added.

It may be added that soon after the October 2002 elections, the then finance minister Shaukat Aziz and the State Bank of Pakistan (SBP) officials had approved the loan write-off scheme and subsequently the SBP had issued a circular, containing guidelines in that regard. The SBP had offered an incentive scheme advising the banks and development finance institutions (DFIs) for waiving of the loans of those organisations which had been showing the “loss” for three years.

On February 20, 2013, the Supreme

Court had ordered making public a 2,200-page report regarding the written-off bank loans worth billions of rupees from 1971 to 2009.

According to the report, the total amount of waived-off loans over the past four decades was Rs87 billion, the major chunk of Rs84.621 billion was written off between 1992 and 2009 and Rs2.3 billion from 1971 to 1991. —