ISLAMABAD -  The Supreme Court on Wednesday noted that according to the trust deed submitted by the Pakistan Tehreek-e-Insaf General Secretary Jahangir Tareen, he had power over income from and capital of the trust.

Jahangir Tareen on April 27th, 2011 created an offshore company with the name Shiny View Limited.

It owns a house constructed on 12 acres with the cost of 2.4 million pounds, under discretionary trust, which was irrevocable.

The company is operated through a trust that is the EFG Bank, which was created on May 5th, 2011 and registered on May 10th, 2011 in the British Virgin Island.

Justice Umar Atta Bandial said that according to the trust deed, Tareen had power on its income and capital.

He asked from Tareen’s counsel, if tomorrow the trust did put property on rent then what would happen.

Justice Faisal remarked Tareen created trust for himself and his posterity, and it was secured through the deed.

Earlier, Sikandar Bashir, representing Jahangir Tareen, argued that his client had no power to direct the trust to invest money, adding its property did not produce income.

The lifetime beneficiary does not give any right to Tareen unless it is exercised in his favour, he said.

If the trust is liquidated and the amount is distributed then shall get the money.

“Absolute beneficial owner of the trust is its trustee. The trust has all power,” Bashir added.

He said it was irrevocable trust and its nature was static.

Bashir contended that Tareen was not the beneficial owner of the property.

Azid Nafees, appearing on behalf of the PML-N leader Hanif Abbasi , said before the Panama leaks judgment there was no disqualification in the proceedings of Article 199 and 184(3) of constitution but the Panama judgment set a new trend.

He also said the apex court also considered the element of manseria (intention), but after the five-member judgment the court need not examine whether it was intentional or unintentional and it could also issue decree.

Azid contended that the 28th July judgment had made the case even easier for disqualification as the court need not to simply depend on the declaration in the nomination paper.

Manseria is no more important, but the conduct is more important, he said.

If the court comes to the conclusion a parliamentarian is not honest then it can give a declaration, Azid said.

Justice Umar Atta Bandial said that in the 28th July judgment the two judges had declared that violation of law could also be considered for disqualification under Article 62(1)(f) of constitution.

The chief justice questioned if your client committed to give you fee and if he does not pay then would he not be Sadiq and Ameen.

Azid contended that the issue needed to be examined whether one did it privately or publically.

Justice Faisal Arab said whether the breach of contract would also be considered dishonesty?

Azid said the parliamentarian had fiduciary duty as he could become prime minister or foreign minister or finance minister.  The parliamentarian has the fiduciary duty towards the nation and to his electors.

He said the court had to examine whether Tareen violated fiduciary duty, adding the PTI general secretary was the director of a company and he was aware of the situation of increasing share rate.

The court noted that the money had gone out of Pakistan through banking channel and asked what tantamount to dishonesty?

Azid said what could be the purpose of creating a company outside with legal money.

He said the property might have been camouflaged, adding if Tareen transferred money legally 100 per cent then there was no need to camouflage.

Azid said it was a revocable trust and was with the settler, Tareen.

He said Tareen’s counsel’s stance was that it was discretionary irrevocable trust and that the settler did not have power.

The PTI general secretary relied upon the Income Tax Ordinance 2001 to not disclose the property, he said.

The chief justice asked Hanif Abbasi’s counsel to show that the money transferred to the UK was still Jahangir Tareen’s asset.

The chief justice asked whether a person was bound to disclose a property, which was with the trust, in his nomination.

Is in the nomination paper it is a requirement to disclose beneficial interest or beneficial yield, he asked.

The chief justice further questioned after creating trust whether the settler remained the owner of the property.

Azid said according to the trust deed, Jahangir Tareen and his wife and children were permanent beneficiaries of the trust, while in his CMA he did not mention that he was a beneficiary, but only stated his wife and children were the beneficiaries of the company.

He said that the court had to see the honesty of Jahangir Tareen by lifting the “corporate veil”.

Azid said Tareen should have disclosed the spouse’s asset even if she was not a dependent.

Hanif Abbasi counsel Azid Nafees and Sikandar Bashir have concluded their arguments.

 


 

Terence J Sigamony