10 MPs, politicians involved in Benami scam

ISLAMABAD: With alleged involvement of ten politicians/public officeholders, the FBR has attached largest ever land of about 12,000 acres (95,603 kanals) in 10 different districts of the country against a corporate firm on charges of possessing Benami assets. The FBR’s Benami wing also attached seven bank accounts of the Benamidar firm through issuance of provisional attachment order and show cause notice.

The market value of attached properties in 10 districts stands at around Rs15 to 20 billion in accordance with conservative estimates.

The ongoing investigations will reveal more startling facts as the FBR investigators seemed confident that the names of certain public office-holders/politicians were allegedly involved in this mega Benami scam, but they refused to share their names arguing that the investigation was still underway. But the record of documentary proof in possession of the FBR revealed that some politicians were allegedly connected with the whole scam as the accused person obtained loans but never came up with rental power plants. Then Supreme Court of Pakistan directed the NAB to probe alleged ill-gotten money. The accused owners established a paper firm and bought 125,000 kanals land allegedly by hiding facts from the NAB. They struck plea bargain with the NAB and committed to pay Rs1.9 billion against ill-gotten money of Rs13 billion. However, they paid just Rs771 million.

The FBR is bound to file reference in 90 days under the Benami law and at time of reference name of certain politicians would be ascertained and made public after completion of ongoing investigation. The alleged ill- gotten money has been routed through UAE and investigators are probing the charges of money laundering as well in this whole scam.

A tale of this whole scam in shape of official documents such as show cause notice, provisional attachment of 95,603 kanal properties and seven bank accounts with money of Rs500 million to Rs1 billion as well as background interviews disclosed on Wednesday that a case was reported by the commissioner Rawalpindi to the FBR after receiving general directives from the PM Office to deputy commissioners for reporting suspected Benami properties to the FBR’s Benami zones located in Islamabad, Lahore and Karachi.

It was reported to the Benami zone Islamabad in August 2019 that huge pieces of land holdings have been registered in the name of a company M/s SAS Pvt Limited (Benamidar). After conducting detailed inquiry, the FBR established that the beneficial owner is Techno Engineering Pvt Ltd.

After conducting detailed inquiry of more than three months and getting evidence through holding joint investigations with assistance of the SECP, NAB, district administrations, detailed tax record analysis and all scheduled banks, the FBR found evidence of the provision of considerations directly from the bank accounts of the beneficial owner to the bank account of sellers, evasion of statutory dues under NAB ordinance 1999, avoidance of contingencies and commitments to defraud the bank creditors, circumventions of provisions of Companies Act 2017, tax evasion of millions of rupees of non-deduction of tax u/s 150, and concealment of financial statements from FBR and SECP and irregularities (contradictory stances in tax returns).

The FBR found that it was held in the Supreme Court of Pakistan in the rental power projects suo motu case judgment that the beneficial owner Techno Engineering Pvt Ltd and its directors Abid Ali Jindrani got the illegal financial benefit of about Rs13 billion.

Consequently, a case was registered in the NAB and plea bargain was done with the commitment to recover dues of Rs1.912 billion. Out of total commitment, the beneficial owner made payment of Rs771 million.

During this period, Benami assets were acquired in the name of Benamidar. The Benamidar company SAS is a paper company, shell company holding Benami assets of about 125,000 kanals land.

The FBR issued provisional order for attachment of 95,603 kanal out of total 125,000 kanal on 17-12-2019 against Principal Officer Abid Ali CEO SAS Pvt Ltd with NTN 1436181-7 on the address of Flat-15 &16 4th Floor Malik Complex 80 East Jinnah Avenue, Blue Area, Islamabad. The FBR attached properties in District Attock including 27,493 kanals land in Mauza Makhad, 4,334 in Chak Fateh Khan, 2117 in mouza Dullhian, 1,954 kanals in Dhari Rai Ditta, 858 kanals in Nara Taraf Nara, 625 kanals in mouza Kinyal, 433 kanals in mouza Kani, 275 kanals in mouza Malluhuwaal, 256 kanals in mouza Dhoke Mari, 240 kanals in mouza Parri, 211 kanals in mouza Pind Kala, 193 kanal in mouza Kolyal and 73 kanal in mouza Fatwala.

In district Mianwali, the FBR attached 15,857 kanals in mouza Massan and 8,560 kanal at mouza Peer Pehal. In district Jhelum, the FBR attached 10,826 kanals in mouza Sial, 6,325 kanals in Ahmedabad, 756 kanals in Langar and 322 kanals in Dhudi Thal. In district Chakwal, the FBR attached 4,453 kanals at Turab Janoobi, 2,034 kanals at Rajar and 1,377 kanals in Mandwal.

In Rawalpindi district, the FBR attached 409 kanals in Bagra, 232 kanals in Sehal, 221 kanals in Bun, 549 kanals in Pind Goundal, 73 kanals in Deddar, 71 kanals in Chak Shahbaz, 71 kanals in Chohhan and 146 kanals in Mohra Shah Wali.

In district Sargodha, the FBR attached 1430 kanals in Bharrath and 1343 kanals in Sadda Kambo. In Muzzafargarh district, the FBR attached 707 kanals, in district Sialkot, the FBR attached 165 kanals in Lorkhay and 36 kanals in Jamkay. In district Khushab, the FBR attached 317 kanals in Jaswal and 48 kanals in Dhak. In district Layyah, the FBR attached 231 kanals in Chak-227 B TDA Korar Lal Hassan. The FBR has attached seven bank accounts including account number 0010036189740017 in ABL Blue Area Jinnah Avenue Islamabad, second account number 000236709108 at UBL Jinnah Avenue Blue Area Islamabad, third account number 0080100007643 in Askari Bank Limited Blue Area Islamabad, fourth account 0100000033 in Askari Bank Blue Area branch Islamabad, fifth account number 00040081049734015 in Bank Ul Habib Blue Area Branch Islamabad, sixth account number 9003000001027228 in JS Bank Blue Area Islamabad and seventh account number 0100024704 in Bank Ul Habib Jinnah Avenue Blue Area Islamabad.

The FBR also found that in violation of SECP regulations and section 84, 85, 199, 200, 242 of Companies' Act 2017 the beneficial owner invested and held assets in the name of Benamidar without any shares, loan, and authorized share capital in the Benamidar company.

When the director of Benamidar and beneficial owner company was summoned u/s 16 of Benami Transaction Prohibition Act 2017 to give statement and produce record relating to Benami assets held on and after the commencement of Benami Transactions Prohibition Act 2017 but they did not complied and did not provide complete record. Their counsel refused that they would not provide further record and started delaying tactics. However, it was revealed by Registrar SECP that meanwhile the Benamidar has applied on 09-12-2019 for increase in authorized share capital in order to sell the shares to the beneficial owner company and to mislead the Benami investigations.

This action prompted the legal action of prohibition of the transfer of Benami assets u/s 5 and hence the provisional attachment u/s 22(3) of the Act was made based on the evidence and the cause of action so that the Benamidar may not alienate from these assets during the investigations and before filing of reference within next 90 days. The FBR has now served show cause notice to Abid Ali CEO S.A.S Pvt Ltd and stated that as per SECP record the authorised share of capital of S.A.S Pvt Ltd is Rs37.165 million against declared shared assets of Rs4.248 billion. The FBR has estimated that the alleged tax evasion stood in the range of Rs500 million to Rs1 billion.

The FBR stated that the Benamidar company is a “Paper Company” a shell company whose primary objectives is to hold Benami assets of the beneficial owner company. As per settled principles held at higher legal for a about the place of entitlement documents, all the entitlement documents of these Benami assets are kept at the business premises of the beneficial owner. As the beneficial owner has lent its premises on paper to Benamidar.