It is apparent that the disguised ownership of the said properties is aimed at avoiding the personal scrutiny and accountability of the appellant under the Income Tax Ordinance, 2001. At the level of income derived by the appellant that process also requires the disclosure of wealth of an assessee and a reconciliation of his total means and total expenditures--Supreme Court in Rai Hassan Nawaz v Haji Muhammad Ayub & others [Civil Appeal No. 532 of 2015]

The contents of five petitions filed in Supreme Court for disqualification of the third-time elected prime minister, his son-in-law and finance minister and rejoinders filed by them once again confirm that our elected representatives are highly insensitive about complying with election laws requiring bona fide declarations of assets and liabilities and discharging of tax obligations. The same position emerges from the references filed against Imran Khan and Jehangir Tareen of Pakistan Tahreek-i-Insaf.

Though rival politicians are accusing each other of concealing assets and/or tax evasion, people of Pakistan are indifferent. In fact, the common people have become further disillusioned about the conduct of their elected representatives vis-à-vis transparency in their financial affairs and discharging tax obligations honestly and diligently.

The citizens are stunned to learn that elected representatives of both the ruling and opposition parties have been taking shelter of section 5 of the Protection of Economic Reforms Act, 1992 and section 111(4) of Income Tax Ordinance, 2001 for concealing untaxed incomes and assets. They ask why such obnoxious laws are still in operation protecting money launderers and tax evaders and why three amnesties were offered in the last three years to tax evaders and another is in the offing for whitening offshore/onshore assets. They ask whether it is beneficial for the State to have such laws and amnesties. They ask if no question can be asked even if illegal and untaxed funds are remitted in Pakistan or sent abroad from foreign currency accounts through banking channels, then why waste time on hearing legal niceties in the case presently sub judice in the highest court of the country.

People of Pakistan are horrified to learn that majority of elected representatives from all parties have very poor tax record. Many years back, the Center for Investigative Reporting in Pakistan (CIRP) in its reports, Taxation by Misrepresentation and Representation Without Taxation: CIRP’s Report Unmasked Tax Evasion In Parliament, exposed how income tax law was violated with impunity by elected representatives but till today no action has been taken by either the Federal Board of Revenue (FBR) or the National Accountability Bureau (NAB).

Section 5(m) of National Accountability Ordinance, 1999 (law effective from 1985 is recently amended through a Presidential Ordinance, National Accountability (Amendment) Ordinance, 2017, to disqualify for life anybody that offers voluntary payment to enter into a plea bargain) includes in the definition of ‘public officeholders’ all existing, former and incumbent presidents, governors, prime ministers, chairmen and deputy chairmen Senate, speakers and deputy speakers, federal ministers, ministers of state, advisors, special assistants as well as political secretaries to the prime minister, parliamentary secretaries, members of parliament, and auditor generals. It also covers anybody who has been an officer or had been holding a post in the service of Pakistan or any service in connection with the affairs of the federation, or of a province, or of a local council or in the management of corporations, banks, financial institutions, firms, concerns, undertakings or any other institution or has been the chairman or vice chairman of a district council, a municipal committee, metropolitan corporation, fall in the category of public officeholders.

Taxation is one of the fundamental elements of constitutional democracy. If elected members do not discharge their tax obligations diligently, not only the entire tax system gets discredited, they also lose the moral right to represent the people. ‘No taxation without representation’ is a cardinal principle of democracy -- Article 77 of our Constitution says that no tax shall be levied for the purposes of the Federation except by or under the authority of the Act of Parliament.

The Supreme Court, in its recent judgement [(2016) 114 Tax 241 (SC Pak.)] has held that "neither a Secretary, nor a Minister and nor the Prime Minister are the Federal Government and the exercise, or purported exercise, of a statutory power exercisable by the Federal Government by any of them, especially, in relation to fiscal matters, is constitutionally invalid and a nullity in the eyes of the law. Similarly, budgetary expenditure or discretionary governmental expenditure can only be authorized by the Federal Government i.e. the Cabinet, and not the Prime Minister on his own."

The abuse of power, concealment of assets/liabilities and tax avoidance/non-compliance by elected representatives have recently been highlighted in a number of judgements of Supreme Court. In the latest judgement, Rai Hassan Nawaz v Haji Muhammad Ayub & others [Civil Appeal No. 532 of 2015], it is held as under:

"An honest and truthful declaration of assets and liabilities by a returned candidate in his nomination papers furnishes a benchmark for reviewing his integrity and probity in the discharge of his duties and functions as an elected legislator. His statement of assets and liabilities along with other financial disclosures contemplated by Section 12(2) of the Representation of People Act, 1976 [ROPA] provide the Election Commission of Pakistan and the general public with a picture of both his wealth and income. Such disclosures are crucial for demonstrating the legitimacy and bona fides of the accrual and the accumulation of economic resources by such a candidate. In other words, the said disclosures show the returns received from his economic activities and can indicate if these activities may be tainted with illegality, corruption or misuse of office and authority. This important aspect of the financial disclosures by a contesting candidate has been noticed by this Court in Muhammad Yousaf Kaselia   vs   Peer Ghulam (PLD 2016 SC 689)".

In Rai Hassan Nawaz v Haji Muhammad Ayub & others, the Apex Court further held that:

"Where assets, liabilities, earnings and income of an elected or contesting candidate are camouflaged or concealed by resort to different legal devices including benami, trustee, nominee, etc. arrangements for constituting holders of title, it would be appropriate for a learned Election Tribunal to probe whether the beneficial interest in such assets or income resides in the elected or contesting candidate in order to ascertain if his false or incorrect statement of declaration under Section 12(2) of the ROPA is intentional or otherwise."

The Supreme Court has held that the Election Tribunal, under section 76A of the ROPA, is conferred with the power to probe, either at its own motion or on the basis of material brought to its knowledge from any source, any false or incorrect statements made by a returned candidate in respect of his own assets and liabilities and those of his spouse or his dependents. Strangely, in the wake of Panama Leaks and Bahamas Leaks, no investigation was initiated by the Election Tribunal as its own motion, as mandated under the law, against any member of Parliament for holding assets abroad using different legal devices, including benami, trustee, nominee, etc.

It is a universally accepted principle that democracy and rule of law go hand in hand and without transparency and accountability both remain mere clichés. It is a constitutional obligation for persons aspiring for members of parliaments to be honest and sagacious. If for contesting elections and thereafter as elected members they commit any lapse in respect of declarations of their assets/liabilities/tax obligations, exemplary punishment should be awarded -- they being custodians of public trust.

The present legal battle before Supreme Court and Election Commission of Pakistan has a silver lining. It has the potential of purging politics from the corrupt, the tax evaders, the beneficiaries of loan write-offs and the plunderers of national wealth -- no matter which political party they belong to. The decision by Apex Court will have far reaching consequences for the future of democracy in Pakistan.

The real challenge before society as a whole is how to eliminate money power that has crippled the institutions and polluted polity where people can exercise freely and independently their right to elect true representatives. Since thana (police), kutchery (courts) and patwari (revenue) are in their control, voters are negatively influenced as they are at the mercy of these butchers. As long as these state institutions remain subservient to rulers thriving on corruption and plundering of national wealth, they will never serve the people as per law.