What next?

The hidden wealth of some of the world's most prominent leaders, politicians and celebrities has been revealed by an unprecedented leak of millions of documents that show the myriad ways in which the rich can exploit secretive offshore tax regimes - 'The Panama Papers: how the world's rich and famous hide their money offshore', The Guardian, April 3, 2016.
After the submission of final report on July 10, 2017, the Supreme Court dissolved the Joint Investigating Team (JIT). The JIT did a herculean task within 60 days. Earlier, the Apex Court conducted twenty hearings before giving voluminous judgement in Imran Ahmad Khan Niazi v Mian Nawaz Sharif & 9 Others [CP No. 29 of 2016]. Now, everybody is asking,"What next?" The moot question remains unearthing of sources of investment outside Pakistan by the House of Sharifs and non-disclosure of the same in their tax declarations at home or abroad. The report of JIT also does not authoritatively determine when and from where the payment of properties in London were made. Unveiling the offshore vehicle with multiple layering and secrecy through bearer certificates was no doubt an uphill task. However, JIT's report confirms one thing beyond reasonable doubt that the ruling family's financial and tax affairs are not transparent.
The ongoing legal battle in Supreme Court and Election Commission of Pakistan between rival politicians of Tehreek-e-Insaf and Pakistan Muslim League (Nawaz) has a silver lining. It has the potential of purging politics from the corrupt, tax evaders, beneficiaries of loan write-offs and 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. One thing that has clearly emerged so far is that as long as state institutions remain subservient to rulers thriving on corruption and plundering of national wealth, people will not be able to enjoy the fruits of representative rule that is at the core of democracy.
Observing that the Sharif family's assets do not match their known sources of income, JIT has recommended filing of a reference against Prime Minister Nawaz Sharif and his offspring with the National Accountability Bureau (NAB). "Failure on the part of all respondents to produce the requisite information confirming known sources of income are prima facie tantamount to not being able to justify assets and the means of income," the JIT's final report observes.
Report of the six-member JIT comprising 10 volumes, including a 254-page summary of the investigation, highlights many gaps and disparities in the declared sources of income and wealth accumulated by Nawaz Sharif and his offspring. "The financial structure and health of companies in Pakistan having linkage to the respondents also do not substantiate the wealth of the respondents," the report says.
The JIT found irregularities in movement of loans and gifts from Hussain Nawaz to his father Nawaz Sharif. It said that five offshore companies including Nielson, Nescoll, Allanna, Lamkin SA Coomber Group Inc and Hiltern International Limited had been used for inflow of funds, which not only acquired expensive properties in the UK from such funds but also revolved these funds amongst their companies of UK, Saudi Arabia, the United Arab Emirates and Pakistan.
"Needless to say, these UK companies were loss-making entities heavily engaged in revolving of funds vis-à-vis creating a smoke screen that the expensive properties of UK were due to the business operation of these UK companies," the report added. The findings said that 32 companies and mills, wherein the PM and his children were acting as shareholders/directors/beneficial owners, are primarily family-owned businesses and the companies were mainly incorporated in the 1980s and the 1990s when the PM was holding public office.
"Accumulation of assets of Hussain Nawaz shows a drastic hike in early 90s with no declared source of income. This is the period the Sharif family was part of ruling elite," the JIT stated, believing that this buildup of assets was through irregular means and the PM's son was used as a proxy to increase the assets.
The JIT submitted that PM Nawaz Sharif concealed Rs 45 million in wealth statement for tax year 2013: "An amount of Rs 100 million was shown as donation given to the PML-N by Nawaz Sharif. However, during analysis of the account statement, it was observed that an amount of Rs 45 million was transferred back by the PMLN on June 10, 2013, to Respondent No.1 (Nawaz Sharif).
The JIT found that financial details of assets of Hussain Nawaz and record of Federal Board of Revenue (FBR) reflected irreconcilable differences that tantamount to hiding of assets and tax evasion. It alleges those financial details of Hassan Nawaz in the UK companies reveal a gap between claimed parent funds from Qatar and his funding to UK companies. It further claims that like Hassan and Hussain Nawaz, the assets of Maryam Safdar also showed extraordinary increase in the 1990s with no declared sources of income.
A strange and shocking revelation is that Maryam Safdar declared ownership of a BMW car as gift from royal family of the UAE on which Rs 3.5 million was paid as customs duty without any known source of income. The same car claimed to be sold at Rs 28 million increasing her assets without identifying the buyer. The same car remained part of her wealth statement in subsequent years, the report claims.
The most damaging part of JIT's report is alleged withdrawal of salary by Nawaz Sharif from FZE Capital, a company registered with Jebel Ali Free Zone Authority (JAFZA) of the UAE. A copy of certificate, duly signed by SVP, Administrative Services JAFZA, Shehab Sultan Mesmar, published in newspapers, depicts Nawaz Sharif as the Chairman of Board of Capital, FZE and receiving salary worth 10000 AED basic. If it is true, the disqualification will be a fait accompli in the light of following two recent cases decided by Supreme Court:
The Rai Hassan Nawaz v Haji Muhammad Ayub & Others [2017 PLD 70 SC] holding 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 Muhammad Ahmad Chatta v Iftikhar Ahmad Cheema & Others [2016 SCMR 763:
From the perusal of record, it is established that while submitting the nomination papers, the respondent has not submitted statement regarding assets of his spouse as required under section 12 of the Act, 1976. The learned Election Tribunal, without taking into consideration this aspect of the case and while holding that respondent has not disclosed assets owned by his spouse and the account maintained by him, dismissed the election petition merely on the ground that mens rea is not proved and further the government exchequer has not suffered any loss on account of non-disclosure of these material facts. This finding of the Tribunal is against the spirit of law and as such calls for interference.
As regards jurisdiction of the Supreme Court to directly disqualify any elected member, it is pertinent to quote Lt-Col. Farzand Ali and others v. Province of West Pakistan through the Secretary, Department of Agriculture, Government of West Pakistan, Lahore (PLD 1970 SC 98) in which the Supreme Court had clarified that where the question was of a right to continue in public office, the Apex Court could interfere "through proceedings not exactly as quo warranto but in the nature of quo warranto with a wider scope".
(The writers, lawyers and partners in Huzaima, Ikram & Ijaz, are Adjunct Faculty at Lahore University of Management Sciences)