JUDGMENT SHEET IN THE ISLAMABAD HIGH COURT, ISLAMABAD

JUDGMENT SHEET

IN THE ISLAMABAD HIGH COURT, ISLAMABAD JUDICIAL DEPARTMENT

W.P. No.2097/2020 Javed Iqbal

v. Federation of Pakistan & 04 others

Petitioners by: Syed Waqar Hussain Naqvi, Malik Babar Hamid, Mr. Muhammad Shahid Kamal Khan, Dr. G. M. Chaudhary, Syed Shahbaz Shah, Hazrat Younis, and Mr. Aftab Adam Yasir, Advocates for respective petitioners.

Respondents By: Barrister Muhammad Mumtaz Ali, AAG.

M/s Ahmar Bilal Soofi, Majid Bashir, Bakhtawar Bilal Soofi, Iqbal Khan Nasr, Samar Masood and Mr Naveed Ahmad, Advocates for NBP.

Mr. Faisal Mehmood Ghani, Advocate for Directors, NBP (Respondents No.2 to 16)

Suhbat Ali Talpur, Deputy Secretary (Banking), Ministry of Finance, Islamabad.

Ms. Mehnaz Salar, Legal Head, NBP.

Mr. Mehmood Nazir Rana, Law Officer, NBP.

Akhtar Javaid (Director), Qadir Bakhsh (Director Finance Department), Sanaullah Gondal (Legal Advisor), Syed Ansar Hussain (Deputy Director) of Banking Policy & Regulation Department, State Bank of Pakistan.

Date of Hearing: 11.06.2021.

JUDGMENT

MOHSIN AKHTAR KAYANI, J:- By way of this common

judgment, I intend to decide the captioned writ petition along with

connected W.P. No.3179/2020 (Syed Jahangir v. Federation of Pakistan, etc.),

W.P. No.3205/2020 (Fazal Rahim Khan v. Federation of Pakistan, etc.) and W.P.

No.3725/2020 (Abdul Latif Qureshi v. Federation of Pakistan, etc.) having

common questions of law and facts, whereby the petitioners have called in

W.P. No.2097/2020, W.P. No.3179/2020, W.P. No.3205/2020 & W.P. No.3725/2020

question notification, dated 12.02.2019, whereby appointments of Arif

Usmani as President / Chief Executive Officer of the National Bank of

Pakistan for a term of three (03) years as well as appointments of other

senior positions in the National Bank of Pakistan have been made.

2. Brief and consolidated facts are that pursuant to publication of a

tailored advertisement Arif Usmani has been appointed as President /

CEO of the NBP for the period of three (03) years vide impugned

notification, dated 12.02.2019, in complete derogation of relevant laws and

precedents of the superior Courts as the newly inducted President has no

relevant qualification. Likewise, the Federal Government, vide impugned

notification dated 17.04.2019, also appointed Zubyr Somroo as Chairman/

Non-Executive Director of the NBP in violation of Bank Nationalization

Act, 1974 and Public Sector Companies (Corporate Governance) Rules,

2013, as such, the said Chairman is also Member / Chairman of Board of

Human Resource & Remuneration Committee as well as of Risk

Committee, and it is clear violation of the SBP Prudential Regulations.

Besides that the above referred appointments, the Federal Government, in

violation of the SBP Prudential Regulations, has also appointed Asma

Sheikh as SEVP, Saad-ur-Rehman Khan as SEVP, Amin Manji as SEVP,

Mehnaz Salar as EVP, Adnan Ally Agha as SEVP, Mudassir Hassan Khan

as EVP, Mirza Muhammad Asim Baig as EVP, Muhammad Abdul Moeed

as EVP, Riaz Hussain as EVP, Danish Bin Inbsat as SVP, Abbas Ali Hatim

as SVP, Syed Kaleem Ahmed Riaz as SVP, Nida Haider as SVP, Moiz

Uddin Khan as SVP, Lt. Col. (R) Abdul Waheed Sabir as SVP, Riaz ud Din

as SVP, Naeem Balouch as VP. Hence, these writ petitions.


3. Learned counsel for respective petitioners contend that the

appointment of NBP’s President is against the rules and practice as the

respondent did not met with required qualification as well as with

minimum criteria; that the President of NBP has no relevant qualification

in the banking field and even he was found involved in money laundering

in Nigeria, in capacity of Managing Director of City Bank Nigeria, per se,

the recruitment process of the President NBP was carried out in violation

of the Public Sector Companies (Appointment of Chief Executive)

Guidelines, 2014; that appointments of Directors in NBP are in flagrant

violation of the test laid down by the apex Court in PLD 2012 SC 132 and

2019 SCMR 1; that the Board of NBP has been constituted in violation of

law and settled principles of the superior Courts as Regulation 6 of the

Listed Companies (Code of Corporate Governance) Regulations, 2017

enumerates that the Independent Directors of listed company shall not be

less than two or one third of the total members of the Board, as such, the

current Board of NBP has only one Independent Director, per se, such

constitution and orders of the Board could rightly be held as illegal; that

the NBP Staff Service Rules, 1973 are statutory in nature but, the

appointments at higher positions in NBP have been made on the ground

that the said Rules of 1973 are not applicable to them as they have been

appointed on contractual basis, which is sheer contempt of this Court’s

order, reported as 2019 PLC (CS) Note 19 Islamabad, even otherwise,

selection of persons to be appointed against senior positions bereft of

merits has been frowned upon by the apex Court in celebrated judgment of

Ashraf Tiwanas, reported as 2013 SCMR 1159.


4. Conversely, learned AAG along with learned counsel for respective

respondents and representatives of the departments contend that the

instant writ petitions are hit by doctrine of laches as jurisdiction of this

Court has been invoked after 20 months of the impugned appointments,

therefore, same are not maintainable; that the petitioners are not aggrieved

persons and lack the locus standi to file the instant writ petitions; that the

office of the President of NBP does not constitute a public office in terms of

Article 199 of the Constitution of the Islamic Republic of Pakistan, 1973 as

the President of NBP is not a public officer in terms of Section 2(17) of the

Code of Civil Procedure, 1908, therefore, instant writ petitions are not

maintainable; that captioned writ petitions are apparently filed with

malafide and ulterior motives to stone-wall the technological and

managerial changes the respondent Bank wanted to bring in.

5. Arguments heard, record perused.

6. Perusal of record reveals that all the petitioners have separately

assailed appointment notification of respondent No.5 Arif Usmani being

President/Chief Executive Officer of the National Bank of Pakistan, who

was appointed vide notification dated 12.02.2019 for a period of three

years. In some of the writ petitions, appointments of Chairman of Board

Human Resource & Remuneration Committee, Risk Committee and

different SEVPs, EVPs and SVPs have also been assailed with the view that

all those appointments have been made in violation of the Banks

Nationalization Act, 1974, Public Sector Companies (Corporate

Governance) Rules, 2013 and the SBP Prudential Regulations.

7. Before going into the legal question qua the appointments, it is

necessary to discuss the establishment of the National Bank of Pakistan.


The NBP was established as a statutory bank under National Bank of

Pakistan Ordinance, 1949 and then it has been regulated by the Banks

Nationalization Act, 1974, whereby Section 3(1) defines the term “bank”, in

the following manner:

(a) a company registered under the Companies Act, 1913

(VII of 1913), and transacting, in or outside Pakistan, the

business of banking as defined in clause (b) of section 5 of

the Banking Companies Ordinance, 1962 (LVII of 1962), in

respect of which no proceedings under Part III or Part IV

of the said Ordinance have been taken or are pending

immediately before the commencing day; and

(b) a banking company incorporated by or under any law

within the legislative competence of Parliament,

including the State Bank, the National Bank of

Pakistan, the Industrial Development Bank of Pakistan

and the Agricultural Development Bank of Pakistan.

8. The above mentioned definition clearly spells out that NBP falls

within the concept of banking company and has specifically been referred

in Section 1(b) of the Banks Nationalization Act, 1974. Learned counsel for

respondents contends that NBP is governed through Banks Nationalization

Act, 1974, which is a special law and Public Sector Companies (Corporate

Governance) Rules, 2013 and Public Sector Companies (Appointment of

Chief Executive) Guidelines, 2015 promulgated by the SECP are to be

treated as general law, which stand excluded on touchstone of Section

505(1)(d) of the Companies Act, 2017, wherein it was held that “any

company governed by any special enactment for the time being in force,

except insofar as the said provisions are inconsistent with the provision of

such special enactment”, this aspect simply excludes the corporate


governance rules as well as guidelines for the appointment of CEO and

Companies Act, 2017 for the appointment of President/CEO of NBP which

has been provided in the Bank Nationalization Act, 1974. This aspect has

also been highlighted by the SECP in their official position as well as

through their opinion rendered in letter dated 20.05.2015.

9. On the other hand, Ministry of Finance in their reply in Para-9 has

also taken the stance and denied applicability of Public Sector Companies

(Corporate Governance) Rules, 2013 on the NBP on the basis of reference

made to Section 505(i)(d) of the Companies Act, 2017.

10. On comparison of the provision of Banks Nationalization Act, 1974

as well as the Companies Act, 2017, this Court is of the view that NBP has

been defined in Section 3(1)(d) of the Banks Nationalization Act, 1974 and,

as such, special law has to prevail over the general law. Even otherwise,

Section 2 of the Banks Nationalization Act, 1974 gives an overriding effect

on all other laws while dealing with the issues relating to general provision

pertaining to management of the banks, especially with reference to

Section 11, which deals with appointment of President, Board of Directors,

Chairman of the Board in respect of the Bank who are appointed by the

Federal Government in consultation with the SBP in terms of Section

11(3)(a) of the Banks Nationalization Act, 1974. Learned counsel for

petitioners contends that Public Sector Companies (Corporate Governance)

Rules, 2013 have been framed with approval of Federal Government

through power granted under Section 506 of the Companies Ordinance,

1962 (now Section 508 of the Companies Act, 2017) read with Section 43(b)

of the SECP Act, 1997, whereby Rule 1(3) of the Public Sector Companies

(Corporate Governance) Rules, 2013 refers that it shall apply on public


sector companies as defined in clause (g) of Rule 2. I have gone through the

said arguments and not convinced with submission that NBP is a public

sector company in terms of Section 2(54) of the Companies Act, 2017 read

with Rule 2(i)(g) of the Public Sector Companies (Corporate Governance)

Rules, 2013, which are not applicable to NBP in a strict sense. However,

Section 505(1)(d) of the Companies Act, 2017 gives an exception as phrase

(except insofar as said provisions are inconsistent with the provisions of such

special enactment) has been used. This aspect is not in contradiction with

special law i.e. Banks Nationalization Act, 1974 rather declares that Public

Sector Companies (Corporate Governance) Rules, 2013 and Public Sector

Companies (Appointment of Chief Executive) Guidelines, 2015 are

applicable to NBP if any situation has not been defined in Banks

Nationalization Act, 1974. On the other hand, it is settled proposition that

the companies which have been controlled by the Federal Government are

to be called public sector companies and they run under the Public Sector

Companies (Corporate Governance) Rules, 2013, whereas by virtue of

Section 3(1)(b) of Banks Nationalization Act, 1974, NBP has been defined

separately in comparison to Section 3(1)(a), which deals with a company

under the Companies Act, 1913 (now Companies Act, 2017) transacting in

or outside Pakistan, the business of banking as defined in clause (b) of

Section 5 of the Banking Companies Ordinance, 1962.

Appointment Procedure of President

11. Section 11(3)(a) of the Banks Nationalization Act, 1974 provides the

concept of appointment of President of the Bank, who shall be appointed

by the Federal Government in consultation with SBP provided that

President shall be appointed from amongst professional bankers whose


names are included in a panel of bankers qualified to be appointed as

President, such panel has also been determined, maintained and varied,

from time to time by the State Bank, hence, appointment of President of NBP

could only be made by the Federal Government in consultation with SBP.

12. In order to resolve the controversy, I have gone through Section 11 of

the Banks Nationalization Act, 1974, which is as under:-

11. General provisions pertaining to management of banks.---(1)

Subject to Sub-section (2), a bank shall have a Board consisting of---

(a) a President, who shall be its Chief Executive; and

(b) not less than five and not more than seven other members

[including one or more directors whose election by the private

shareholders, removal and other matters shall be governed by the

Companies Ordinance, 1984.

(2) The Federal Government may, if it deems necessary, appoint a

Chairman of the Board in respect of a bank.

(3) The Chairman, the President, and other members of the Board

[representing the Federal Government’s direct and indirect

shareholding”]----

(a) shall be appointed by the Federal Government, in

consultation with the State Bank, for a term of three years, on

such terms and conditions as may be fixed by the General

Meeting of the bank: Provided that the Chairman and the

President shall be appointed from amongst professional bankers

whose names are included in a panel of bankers qualified to be the

Chairman or the President, which panel shall be determined,

maintained and varied, from time to time, by the State Bank;

(b) may be removed for misconduct or physical and mental

incapacity before the expiry of the three years term by the Federal

Government in consultation with the State Bank;

(c) shall stand removed if he becomes ineligible on any of the

grounds specified in sub-section (12); and

(d) may be re-appointed by the Federal Government, in

consultation with the State Bank of Pakistan, [for such further

term or terms as may be determined.”]


13. In compliance of above provision, Finance Division advertised the

post of CEO/President of NBP in the national newspaper on 30.09.2018,

whereby 98 applications were received, the same were scrutinized by the

short listing committee constituted vide order dated 11.10.2018, comprising

of Additional Secretary Establishment Division, Finance Division, Special

Secretary Finance and Secretary Finance, who have given their marking by

making a comparative analysis of each candidate. Before going further, it is

necessary to reproduce the eligibility qualification and other factors which

were advertised in the daily newspaper for the post of CEO/President of

NBP, which are as under:-

GOVERNMENT OF PAKISTAN FINANCE DIVISION

PRESIDENT/CEO

NATIONAL BANK OF PAKISTAN Finance Division requires the services of a dynamic and qualified full time

professional for the position of President/CEO, National Bank of Pakistan

(NBP) to be filled in accordance with Banks (Nationalization) Act, 1974.

The prescribed qualifications, experience, age limit and other terms of

appointment are as

QUALIFICATIONS & EXPERIENCE

Minimum Bachelor’s and preferably Master’s degree from a local or

foreign institution recognized by the Higher Education Commission in the

disciplines of banking, finance, economics, business administration

or related fields. Applicants must have extensive experience in the

financial sector with at least 5 years of experience at senior level as EVP

and above or equivalent in banking sector and posses expertise and skills

to perform the responsibilities of the position effectively and prudently.

Applicants should also have the eligibility to qualify for inclusion in the

list of professional bankers maintained by State Bank of Pakistan.

14. The short listing committee headed by the Secretary Finance

Division has compared each and every aspect of the candidates/applicants

for the post of President of NBP in line with the eligibility criteria as per


advertisement, as a result of the same, following five candidates were short

listed:-

i) Mr. Atif Bajwa

ii) Mr. Nadeem Lodhi

iii) Wajahat Hussain

iv) Javed Kureishi

v) Arif Usmani

15. The comparative marks achieved by these five candidates are as

under:-

S #

Name and age of the Candidate

Qualification and relevant experience

Educational Qualifications (20 Marks)

Experience (30 Marks)

Total Short-listing Marks

Qualification (Including Quality and Standard)

Higher/ Additional/ Professional qualification in the relevant field

Relevance and quality / Standard

Diversity Holding of Senior Positions/ Eminence

1 to 10 Marks

1 to 10 Marks

1 to 20 Marks

1 to 5 Marks

1 to 5 Marks

1 to 50 Marks

1. Mr. Atif Bajwa 60 years

Graduation in Finance Columbia University (USA) Ex-President/CEO Alflah, Soneri & MCB bankds and over 20 years exp as EVP and above in international banks

Graduation 10

0 18 4 4 36

2. Mr. Javed Kureshi 57 years

Graduation in Economics University of Sussex UK Over 20 years exp as Head/ Group Head in international banks

Graduation 10

0 17 04 03 34

3. Mr. Wajahat Husain 60 years

MBA, IBA Karachi Ex-president/CEO UBL and 14 years exp as EVP/SEVP in banks

MBA 08

0 17 04 04 33

4. Mr. Arif Usmani 61 years

Graduation in Theoretical Physics Imperial College of Science & Technology, University of London 18 years exp as EVP and above in international banks i.e. Citibank, ADIB and Mashriq Bank, UAE

Graduation 08

0 17 04 03 32

5. Mr. Nadeem B.A (Economics Graduation 0 14 03 03 30


Lodhi 55 years

& Finance) Muhlenberg College, Allentown USA Country Officer Citi Bank Pk since 2012 Over 20 years exp as Senior Banker in International Banks

10

16. On the basis of five short listed candidates referred by short listing

committee, the selection committee duly constituted by the Prime Minster

Office, vide order dated 02.11.2018, headed by Secretary Ministry of

Finance conducted the interviews on 09.11.2018, as a result whereof one of

the candidates Mr. Atif Bajwa did not participate in the interview,

committee unanimously recommended three persons for the post of

CEO/President NBP in order of merit namely (a) Mr. Javed Kureshi, (b)

Mr. Arif Usmani, (c) Mr. Wajahat Hussain. However, Javed Kureshi has

withdrawn his name from the appointment process due to some personal

reasons as he sent e-mail to the Ministry of Finance in this regard. The

remaining two candidates have been considered and Mr. Arif Usmani,

who was on the top in order of priority has been recommended through a

summary prepared by Finance Division, which was sent to the Cabinet for

appointment as CEO/President of NBP. The Cabinet in its meeting dated

23.11.2018 approved the appointment of Mr. Arif Usmani as

CEO/President of NBP subject to notification by Government of Pakistan

as required u/s 11 of the Banks Nationalization Act, 1974.

17. The State Bank of Pakistan while evaluating FPT assessment of Arif

Usmani raised the objection qua his dual citizenship as he was also

national of Antigua & Barbuda, where-after Arif Usmani renounce his

citizenship and submitted renunciation certificate duly issued by Ministry

of External Affairs Antigua & Barbuda Citizenship Regulations, 1982 and


certificate dated 04.02.2019 was provided, the same is appended with this

writ petition. After clearance by the State Bank of Pakistan, Finance

Division issued notification for appointment of CEO/President on

12.02.2019.

18. Learned counsel for the petitioners have mainly argued upon the

issue of qualification and experience in which it was argued that the

Bachelor degree in the disciplines of “banking, finance, economics, business

administration or related fields” is the minimum requirement to be

demonstrated by the applicants before the short listing selection committee

and as such the first objection on the appointment of Arif Usmani is qua

his educational qualification, whereby the comparative chart referred

above only gives the marking on the basis of graduation. Against the name

of Arif Usmani in column No.2 qualification, it has specifically been

written “Graduation in Theoretical Physics”. Now the question arises as to

whether the subject of physics fulfills the minimum requirement of

bachelor degree in the fields of banking, finance, economics, business

administration or related fields? In order to resolve this issue it is necessary

to apply the minimum test settled by the rules of interpretation where

specific term i.e. subject or related field have not been defined then the

literal rule has to be applied by giving the words used ordinary, natural

and grammatical meaning. However, if such reading leads to absurdity

and the words are susceptible of another meaning, the Court may adopt

the same. If no such alternate construction is possible, the Court must

adopt ordinary rule of literal interpretation. It is settled law that statute has

to be interpreted in a manner more conducive to the interest of justice and


practically possible as held in PLD 2007 SC AJK 119 (Tahir Mahmood and

3 others Vs. Khalid Sharif and 9 others).

19. I have gone through Section 11 of the Banks Nationalization Act,

1974 with the assistance of learned counsel for the parties as well as AAG

they all are unanimous that Section 11 is silent qua the bachelor or master

degree of related fields of banking, finance, economics, business

administration. The plain reading of section 11(3)(a) of the Act highlights

the only pre-requisite for appointment against the post of President that

name should be included in the panel of bankers, determined, maintained

and varied from time to time by the State Bank of Pakistan, hence, it is clear

that the subject requirement incorporated by the Ministry of Finance in

their advertisement is not the requirement of basic law, but now the same

has to be applied in strict manner.

20. The basic law is silent qua the subject requirement but Ministry of

Finance has imposed the requirement of bachelor degree in four subjects or

in the related field, in this scenario the question arises as to whether the

degree of bachelor in theoretical physics is equivalent to the disciplines of

banking, finance, economics, business administration, such aspect has to be

seen while applying the literal rules especially when these four subjects

have not been defined in the Act or in any other legislation. Banking is

derived from basic word “bank” means “financial institution, commercial

bank, etc. Finance means money matters, pecuniary matters, fiscal matters,

economics, money management, commerce, business, investment. Economics

means financial, monetary, pecuniary, budgetary, fiscal, trade, mercantile”.

“Business Administration” means “management of business in all aspects

including finance, marketing, human recourses, etc.” as referred in Oxford


thesaurus of English. On the other hand, the term “business” has been

defined by Blacks’ Law Dictionary 8th Edition as “commercial enterprise

carried out for profit and commercial transaction”; “banking” means “business

carried on by or with bank”; “economics” means “the social science dealing with

the production, distribution and consumption of goods and services”; “finance”

means “the aspect of business concern with management of money, credit,

banking and investment”. In broader perspective, the fields i.e. banking,

finance, economics and business administration have been defined as under:

BANKING 1

Banking is an industry that handles cash, credit, and other

financial transactions. Banks provide a safe place to store extra

cash and credit. They offer savings accounts, certificates of deposit,

and checking accounts. Banks use these deposits to make loans.

These loans include home mortgages, business loans, and car loans.

Banking is one of the key drivers of the U.S. economy. It

provides the liquidity needed for families and businesses to invest

in the future. Bank loans and credit mean families don't have to

save up before going to college or buying a house. Companies use

loans to start hiring immediately to build for future demand and

expansion.

FINANCE 2

The management of large amounts of money, especially by

governments or large companies.

Finance is defined as the management of money and

includes activities such as investing, borrowing, lending,

budgeting, saving, and forecasting. In other words, Finance is a

term for matters regarding the management, creation, and study of

money and investments. Finance can be broadly divided into three

categories: (1) personal, (2) corporate, and (3) public/government.

KEY TAKEAWAYS

• Finance encompasses banking, leverage or debt, credit,

capital markets, money, investments, and the creation and

oversight of financial systems.

• Basic financial concepts are based on microeconomic and

macroeconomic theories.

1 Banking and How It Works by Kimberly Amadeo 2 https://corporatefinanceinstitute.com


• The finance field includes three main subcategories:

personal finance, corporate finance, and public

(government) finance.

• Financial services are the processes by which consumers and

businesses acquire financial goods. The financial services

sector is a primary driver of a nation’s economy.

ECONOMICS 3

The branch of knowledge concerned with the production,

consumption, and transfer of wealth.

The condition of a region or group as regards material

prosperity.

Economics is a social science concerned with the

production, distribution, and consumption of goods and services.

BUSINESS ADMINISTRATION 4

(In education) a course of study at a university or college

that prepares students for managerial roles in companies or

organizations.

The term also refers to the management of a business i.e.

management in all aspects. This includes finance, marketing,

human resources, and accounting. It also includes business

operations.

The administration of a business includes the performance

or management of business operations and decision-making, as

well as the efficient organization of people and other resources to

direct activities towards common goals and objectives. In general,

“administration” refers to the broader management function,

including the associated finance, personnel and MIS services.

Administration can refer to the bureaucratic or operational

performance of routine office tasks, usually internally oriented and

reactive rather than proactive. Administrators, broadly speaking,

engage in a common set of functions to meet an organization’s

goals. Henri Fayol (1841-1925) described these “functions” of the

administrator as “the five elements of administration.” According

to Fayol, the five functions of management are;

1. Planning.

2. Organizing

3. Commanding

4. Coordinating

5. Controlling

3 Oxford Dictionary 4 GNU Free Documentation Licence (www.sciencedaily.com)


21. While going through these definitions provided in law dictionary

and ordinary dictionary of Oxford, the above referred terms are considered

to be words which have to be interpreted in context of whole scheme of

things which they are to serve, especially when these terms have not been

defined anywhere in the Act, in such scenario it is the function of the court

to interpret in such a manner as to reconcile them and make them

consistent with each other. The court shall assign ordinary and plain

meaning to words used in any statute and not to import meaning of any

word which is not susceptible or defeat the intent of law makers. Similarly

where there is no technical definition in the statute or rules framed therein,

then one has to resort to ordinary dictionary meaning held in PLD 2016 SC

534 (Chairman, Pakistan Railways v. Shah Jehan Khan). It is the duty

devolved upon the court to ascertain the true meaning especially when

there is an ambiguity or phrases used in the legislative document are silent,

then courts have to fill the gaps, clear doubts and eliminate hardships,

which leaves a sufficient discretion for the Judges to interpret laws in the

light of purpose as held in 1999 SCMR 1852 (Sheikh Saeed Ahmed and

another Vs. Abdul Wahid).

22. While going through the interpretation techniques all the four

disciplines referred in the advertisement have been taken through their

ordinary dictionary meaning or the 5th term “related fields” means

“connected, interconnected, associated, linked, coupled, allied, evaluated,

comparable, equivalent and field means green lands, recreational ground, park,

area, etc.” as referred in Oxford Thesaurus of English.

23. The definition and dictionary meaning qua the words “related

fields” means that the principal subject/discipline i.e. banking, finance,


economics and business administration are the predominant areas, where

applicants have to demonstrate their educational background with

reference to these subject, however, the Ministry of Finance while

considering the highest position has extended the scope and used the term

“related field” which gives the meaning that other disciplines may also be

included having some commonality and equivalence. At this stage, this

court has considered the ordinary meaning of the discipline of the subject

theoretical physics for the purpose of comparison with other four

disciplines, theoretical physics means, “the description of natural

phenomena in mathematical form” [as referred in Collins Dictionary].

Similarly, the subject “theoretical physics” has also been explained as,

“theoretical physics is a branch of physics which employs mathematical

models and abstractions of physical objects and systems to rationalize,

explain and predict natural phenomena. This is in contrast to experimental

physics, which uses experimental tools to probe these phenomena.” [The

Story Of Our Universe: An Archimedean Screw Interpretation by Johny

Jagannath], therefore, the four disciplines defined in the advertisement i.e.

banking, finance, economics, business administration and its related fields

have no nexus with theoretical physics in any manner, although learned

counsel for respondent No.5 has heavily relied upon the following

published articles:-

i. Why do physicists gravitate towards jobs in finance? By Jeff

Forshaw, published on 21st July, 2013 in “The Guardian”.

ii. Taking the long view. By Patrick White and Emma Smith,

published in January, 2017 in “Physics World”.


iii. Common Careers of Physicists in the Private Sector. By

Roman Czujko and Garret Anderson, AIP Statistical

Research Center.

iv. Physicists Graduate from Wall Street. By Jennifer Ouellette,

published in December, 1999.

v. Physicists in Finance. By Joseph M. Pimbley, published in

January, 1997.

vi. Finance jobs for physics and maths graduates, published on

31 January, 2020.

24. I have gone through these articles which give complete insight qua

the different midcareer physicists who are working in the field of finance,

trading companies, investment group and also managing the investment

funds, majority of them working in large international banks. In majority

of the published articles and research journals referred by learned counsel

for respondent No.5 explains that high number of physicists applied their

knowledge and expertise of mathematical software and modeling to field

of finance. They built financial risk models or developed financial

modeling software. These models and algorithms are often used to buy

and sell financial instruments and predicting the movement in prices,

future of equity markets, bonds, currency marketing, mortgage,

refinancing rate, etc. All these articles are based upon comparative analysis

and might be based upon correct data collected by the authors and writers

but this court is not equipped to give an equalization of theoretical physics

with other discipline to be called as related fields of finance, banking,

economics and business administration, such aspect requires deeper

analysis by the technical experts of the relevant fields, such as SBP, HEC,

Ministry of Finance, HODs of different state universities, etc., therefore,


such practice is not permissible under the law to be applied in cases of

judicial review in terms of Article 199 of the Constitution of Islamic

Republic of Pakistan, 1973.

25. The Courts are governed on the basis of plain, simple principles

where literal interpretation of the words and terms could be made within

four corners of law. As such, it is the case of respondent No.5 that the

subject of theoretical physics is related to banking, finance, economics and

commerce field in some aspect but the job requirement advertised in the

newspaper are with specific discipline other than theoretical physics. In

case, if the Federal Government is interested to enlarge the pool of

applicants in order to achieve the best person to be recommended for the

said post, they are equipped and empowered to exclude the discipline of

economics, finance, banking and business administration by changing the

same with Urdu, Islamiyat, Chemistry, Biology or Theoretical Physics, etc.

or only refers the minimum requirement of bachelor degree of any field

but this is not the case, therefore, in such scenario the very basic

foundation i.e. the subject (qualification) for the post of President of NBP

seems to be agreed against the standard set out in the advertisement. I

have gone through the qualification of respondent No.5, which is

Graduation in Theoretical Physics from Imperial College of Science &

Technology, University of London and even respondent No.5 has not

achieved any other qualification qua the banking, finance, economics or

business administration after his bachelor degree so that he could not be

evaluated among his other colleagues though it has been claimed and also

acknowledged by Federal Government as well as officials of State Bank of

Pakistan that respondent No.5 is the best person having vast experience of


four different banks including the international banks and he was selected

amongst 98 applicants rather he stood first on the basis of pre-selection

committee evaluation as well as by the selection committee, there-after his

name has been approved by the Federal Cabinet. I am surprised to see the

working of selection committee comprising of the best policy makers of the

Government of Pakistan including Secretary Finance and the officials of

State Bank of Pakistan who have ignored the educational qualification

blatantly coupled with the fact that no explanation regarding ignoring the

basic qualification is available on record.

26. I have called Director Finance, Legal Advisor and Director Policy of

the State Bank of Pakistan to apprise this court who have taken the stance

before this court that respondent No.5’s name has been enlisted in the

panel of professional bankers u/s 11(3) of the Bank Nationalization Act,

1974 and his name was enlisted for the position of President as well as

Chairman since, 2008 and 2011 respectively as he had performed his duties

as ex-country head Citi Bank Pakistan and has also remained on such

position of two other international banks. As per Prudential Regulations,

the State Bank has applied the fit and proper test including but not limited

to the integrity, honesty, reputation, solvency, financial integrity,

qualification and experience, conflict of interest with the assessment of

fitness and propriety as referred in Annexure-A appended with the

regulations in which the requirement of CEO has been mentioned in clause

4(ii)(c), whereby the applicant who have minimum qualification of

graduation or equivalent in the discipline of banking, finance, economics,

business administration and related fields are eligible. In response to said

query, the officials of State Bank of Pakistan have taken a stance that this is


not hard and fast requirement especially when the name of an individual

has been enlisted in the panel of bankers maintained by State Bank of

Pakistan on the basis of experience and evaluation of his previous key

position of the banks (local and international), as such, the name of

respondent No.5 is maintained since, 2008 in the panel of bankers. This

argument by the officials of State Bank of Pakistan is contrary to the

prescribed standard provided in fit and proper test, such answers also lead

to a disclosure that both the officials of State Bank of Pakistan and Ministry

of Finance, Government of Pakistan have not gone through the minimum

qualification requirement and over looked one of the basic ingredient of

fitness and proper test.

27. I have also gone through the approval of name of respondent No.5

when his name has been enlisted in the panel of bankers by the State Bank

of Pakistan and has also gone through different examples in which

different individuals have been enlisted in the panel of bankers who are

short of qualification of related degree in the field of banking, finance,

economics and business administration but such requirement could be

over looked for private banks but same could not be excluded for any

public sector bank owned and controlled by the Federal Government.

28. After going through the complete record as well as arguments

advanced by different parties in this case, this Court is of the view that the

SBP has made certain technical mistakes while enlisting the name of

professional bankers in the list of panel in terms of Section 11(3)(a) of the

Banks Nationalization Act, 1974 by ignoring their qualification factor as

majority of professional bankers have short of relevant qualification but

they have been accommodated on the basis of their experience, such


illegality is not curable unless the SBP changes the qualification factor and

special discipline of banking, finance, economic, business administration

are related fields, therefore, it is necessary to pass a direction to the

Governor SBP to look into the affairs and revise the list of panel of

professional bankers maintained by SBP by applying strict criteria

mentioned in the law, otherwise all those persons who have short of the

discipline or related fields of banking, finance, economics, business

administration, etc. are not eligible to be enlisted, though they might have

vast experience of banking sector.

29. Learned counsel for petitioner Syed Waqar Hussain Naqvi,

Advocate in W.P. No.3205/2020 has initially assailed the appointments of

Respondents No.5 to 10 i.e. Non-Executive Directors and one Independent

Director of NBP but, during the course of proceedings learned counsel, has

withdrawn his writ petition to the extent of respondents No.6 to 10, vide

order dated 25.05.2021, whereafter the only issue left for determination of

this Court is regarding the status of Zubyr Somroo being Chairman/Non-

Executive Director, NBP. Learned counsel has confined his arguments to

his extent only and argued that NBP is a public sector company in terms of

Section 2(54) of the Companies Act, 2017 read with Rule 2(1)(g) of Public

Sector Companies (Corporate Governance) Rules, 2013. The NBP is also

listed company as per definition of Section 2(38) of the Companies Act,

2017, hence the Public Sector Companies (Corporate Governance) Rules,

2013 and Listed Companies (Code of Corporate Governance) Regulations,

2017 are applicable to the NBP. While considering the arguments of

learned counsel, this Court has already answered this query in Para-10 of

this judgment with the conclusion that NBP is not a company falling


within the definition of Section 2(54) of the Companies Act, 2017 nor falls

within the mandate Public Sector Companies (Corporate Governance)

Rules, 2013, but the expression in Section 505(1)(d) of the Companies Act,

2017 (except in so far as the said provisions are inconsistent with the provisions of

such special enactments) has been used, the grey areas may be filled in with

these enactments and rules. The Federal Government in exercise of powers

granted by By-laws 2015 read with Bank Nationalization Act, 1974 in terms

of Section 11(1)(b) appointed six Non-Executive Directors and one

Independent Director vide notification dated 17.04.2019, which is

reproduced hereunder for ready reference:

Government of Pakistan

Finance Division

(Internal Finance Wing)

*****

NOTIFICATION

Islamabad the April 17, 2019

No.F.1(11) Bkg-III/2017-568. In exercise of powers conferred under Section

11(3)(1) of the Banks (Nationalization) Act, 1974, the Federal Government is

pleased to appoint the following incumbents as Chairman / Directors on the

Board of Directors of National Bank of Pakistan for a term of three years with

immediate effect in place of the persons mentioned against each.

S# Name Position In place of

1. Mr. Zubyr Soomro Chairman Vacant slot

2. Mr. Muhammad Sohail Rajput,

AFS (IF/Inv) Finance Division

GoP

Director

Mr. A. Akbar Sharifzada,

Ex-AFS, Finance Division.

3. Mr. Tawfiq Asghar Hussain Director Mr. Muhammad Imran

Malik

4. Ms. Sadaffe Abid Director Mr. Asad Munir

5. Mr. Zafar Masud Director Vacant slot

6. Mr. Imran Bakhsh Baloch Director Vacant slot

(Suhbat Ali Talpur)

Deputy Secretary to the

Government of Pakistan

30. However, at this stage, the petitioner is only aggrieved to the extent

of Zubyr Somroo who has been appointed as Chairman of the Board of

Directors primarily on the ground that the appointments of Chairman and


Director were in violation of Banks Nationalization Act, 1974, Public Sector

Companies (Corporate Governance) Rules, 2013, SBP Prudential

Regulations and Listed Companies (Code of Corporate Governance)

Regulations, 2017. I have confronted learned counsel for petitioner to

highlight the grounds and reasons which are in violation of law in case of

appointment of Zubyr Somroo being Chairman of the Board of Directors,

NBP, whereby the learned counsel advanced the following grounds:

a) Zubyr Somroo is 73 years of age, who could not be appointed

as Chairman nor any relaxation of age has been extended to

him by the Federal Government, therefore, his appointment is

in violation of the 2019 SCMR 1 (HRC No.365/2019, in matter

regarding appointment of Managing Director PTVC).

b) Zubyr Somroo being Chairman of the Board of Directors is

also Chairman of Board of Human Resources and

Remuneration Committee and Member of Risk Committee

which is in violation of the SBP Prudential Regulations.

c) Zubyr Somroo has received Rs.1,928,000/- as meeting fee for

attending both meetings of the committees in 2019 as evident

from the annual accounts of NBP for the year 2019.

d) Zubyr Somroo is interfering in day to day affairs of NBP and

even conducting meetings with officer of NBP regularly in

violation of SBP Prudential Regulations G1, Para B, Sub Para 1.

e) Zubyr Somroo has conducted a meeting with the bank officers

of junior grades on 10.07.2020 without participation of the

President and is also in occupation of complete 5th floor of

NBP building in Karachi.


f) Zubyr Somroo has hired the secretarial staff through internal

advertisement, dated 18.05.2020, for Research Associates of

EVP / VP to be placed at Chairman Secretariat.

g) Zubyr Somroo has passed certain order in violation of

Remuneration Policy and has allowed additional payments

and perquisites to the Non-Executive Directors and Chairman,

although they are only entitled to TA/DA under the standards

rules and regulations.

h) Zubyr Somroo along with other Directors in their 301st

Meeting held on 12.12.2019 recommended remuneration

package for Chairman in violation of SBP Instructions and

Code of Corporate Governance.

i) Zubyr Somroo received Rs.2,550,000/- in the heads of fees and

allowance along with the amount of Rs.1,654,000/- in the

heads of others for period of seven months, as such, he

attended only two meetings which cost the bank to the tune of

Rs.2,276,000/-, per se, total amount received by him sum up to

Rs.5,204,000/-, which itself is in violation of Public Sector

Companies (Corporate Governance) Rules, 2013

31. While going through the objections raised by the petitioner, the

grounds (c) & (i) relating to remuneration of Zubyr Somroo have to be

understood within the concept of the expression i.e. Non-Executive

Director is defined in Section 2(1)(e) of the Public Sector Companies

(Corporate Governance) Rules, 2013 which means a Director of public

sector company who is not interested with responsibilities of

administrative or managerial nature. Such Directors are only entitled to get


their remuneration if they attend meeting of the Board and, as such, no

regular remuneration will be paid to such kinds of Directors. However, the

decision has to be made by the Board of Directors of NBP after scrutiny of

the record as to whether Zubyr Somroo has received perks and privileges

on account of salary or otherwise and these payments are legally

justiciable, therefore, this Court will not enter into these disputed facts

which are within the domain of Board of Directors of NBP. The concept of

appointment of Chairman of the Board of Directors in terms of Banks

Nationalization Act, 1974 is governed under Section 11(3)(a) of the Act,

whereby the Chairman shall be appointed by the Federal Government in

consultation with the SBP for term of 3 years, on such terms and conditions as

may be fixed by General Meeting of the Bank; provided that the Chairman and the

President shall be appointed from amongst professional bankers whose names are

included in the panel of bankers qualified to be Chairman or the President, which

panel shall be determined, maintained and varied, from time to time, by the State

Bank. The above mentioned minimum prerequisite has been seen through

the record and para-wise comments separately submitted by the Finance

Division, Government of Pakistan, in compliance of direction passed by

this Court on 11.06.2021, which reveals the following details:

2. Finance Division was in search of potential/competent

candidates for the vacant positions of Chairman and

Directors of NBP’s Board and was evaluating the known

professional bankers of the country. Mr. Zubyr Soomro,

who is very senior and renowned banker of Pakistan, was on

the board of SBP at that time. He obtained BSc Economics

from London School of Economics (LSE), MA from School

of Oriental and African Studies (SOAS), remained Country

Head/Chief Executive of international banks, President &

Chairman of United Bank, Chairman Pakistan Banks

Association and held various important posts in his

professional career (Annex-I).


3. Considering his vast banking experience, and as a

Director of State Bank of Pakistan (“SBP”), the

central bank of Pakistan which regulates all other

banks and the monetary/credit system on behalf of the

Government of Pakistan, he was considered the best

choice for becoming the Chairman of another

Government owned bank i.e. NBP.

4. After seeking his consent, the Finance Division, proposed

his name, along with the following other candidates, for the

position of Chairman/Directors of NBP:-

S# Name Position

1. Mr. Zubyr Soomro Chairman

2. Mr. Taqfiq Asghar Hussain Director

3. Mr. Hussain Islam Director

4. Mr. Asif Jooma Director

5. Ms. Sadaffe Abid Director

6. Mr. Zafar Masud Director

5. In compliance with Section 11(3)(a) of BNA 1974, Finance

Division requested SBP to furnish its view/comments vide

letter No.F.No.1(11)Bkg-III/2017/122 dated January 24,

2019 (Annex-II)

6. SBP evaluated the above mentioned candidates and

provided its views/comments vide Letter

No.BPRD(CGD)/FD/NBP/7099/2019/3532 dated

February 14, 2019. No objection was raised against Mr.

Zubyr Soomro. Mr. Hussain Islam against whom SBP gave

certain observations was dropped from the consideration

(Annex-III).

7. Views/comments of SBP with regard to Mr. Zubyr Soomro

vide above said letter are reproduced as under for ready

reference:

“Mr. Zubyr Soomro possesses requisite qualification

and experience for the position of board

member / Chairman, NBP. However, he is

currently serving on the board of SBP and his

term will expire on March 21, 2019. As per

Section 13(1)(F) of SBP Act, 1956, he cannot

continue directorship of SBP, if he is


appointed as a Director (Board Member) of

any bank. Therefore, in order to be appointed

as Chairman NBP, he has to leave his

directorship from SBP’s board. Further, as per

BNA, 1974, both the President and Chairman

of the bank should be appointed from the panel

of professional bankers. Considering his

professional experience and qualification, Mr.

Zubyr’s name has been included in the

professional banks”.

8. It is important to note that any Director of SBP cannot

simultaneously become Director/President/Chairman of any

other bank since SBP is the regulator and it can amount to

conflict of interest and his name was not earlier included in

the panel of professional bankers. However, since his term

was to expire on 21 March 2019 after which he was

proposed to be appointed as Chairman NBP, his name was

added in the panel of professional bankers.

32. The above referred reply of Finance Division clearly spells out that

the name of Zubyr Somroo was not available in the panel of professional

bankers due to restriction of the SBP as a result, the name of Zubyr Somroo

has been included by the SBP on urgent need basis in violation of their

own law, especially when he was in the Board of Directors of SBP.

Similarly, Zubyr Somroo has been selected by the Finance Division at their

own without any known method of search i.e. by inviting applications,

through advertisement in the national dailies or from the list of

professional bankers, hence it has clearly been established that Zubyr

Somroo has been nominated by the Finance Division on the whims and

choice of some individual behind the curtain without any subjective

criteria which amounts to negation of principle of fairness, transparency

and legitimate expectation of others, who have been deprived of from such

a process, though the Federal Government is competent to appoint any

person which they may choose for the position of Chairman in terms of


Section 11(3)(a), however in comparison to the appointment of post of

President of NBP, whose name has been brought through advertisement

and not by a method adopted for Zubyr Somroo. In such situation, when

Banks Nationalization Act, 1974 has not provided the concept of

advertisement for any position of President or Chairman of NBP, the

minimum requirement provided in Public Sector Companies (Corporate

Governance) Rules, 2013 highlight the concept of public advertisement or

public notice to achieve the best person after competitive process. In case of

non-issuance of public notice the process could be considered as tailored

made to accommodate blue eyed person and considered to be illegal. For

making appointment against public posts, issuance of advertisement

inviting application from all eligible candidates is the basic requirement.

The advertisement must specify the number of posts available for selection

and recruitment. The qualification and other eligibility criteria for such

position should explicitly be provided and schedule of recruitment process

should be published with certainty and clarity. The advertisement should

also specify the rules which are necessary to prevent arbitrariness and to

avoid change of criteria after selection process is commenced as held in

AIR 1914 SC 2175 (Renu & Ors vs. District & Sessions Judge, Tis Hazari &

another). The requirement of advertisement has also been highlighted in

cases reported as 2019 SCMR 1 (in the matter of HRC No.3654/2018:

regarding appointment of Managing Director, PTVC) and 2012 SCMR 673

(Muhammad Ali v. Province of KPK through Secretary, Elementary and

Secondary Education, Peshawar), whereby it was held that appointment

made in public office without advertisement is considered to be illegal.

Learned counsel for respondent Zubyr Somroo contends that publication


of an advertisement is not articulated in the Banks Nationalization Act,

1974 nor it is the requirement of law but he could not escape from the

advertisement given for the post of President NBP though the appointment

of the President was also made in terms of Section 11(3)(a) of the Banks

Nationalization Act, 1974, hence this Court is of the view that Finance

Division has adopted two different criteria depending upon their

requirement and to accommodate the person of their choice without giving

effect to transparency and principle of fairness, initiated the name of Zubyr

Somroo without inviting applications from general public or those

technical special experts enlisted in the panel of professional bankers

maintained by the SBP. Such conduct could not be condoned in any

manner.

33. The other technical flaw in this case, which came into limelight is

the status of Zubyr Somroo who was on the Board of Directors of SBP

when his name has been floated by Finance Division, Government of

Pakistan, this aspect has also been admitted by the officials of the State

Bank of Pakistan, Banking Policy & Regulation Department, who

acknowledged that the name of Zubyr Somroo was not included in panel

of professionals when his name was floated for vacant post of Chairman of

NBP as he was on the Board of Directors of State Bank of Pakistan at that

very time. In the SBP his term stood expired on 20.03.2019 and in order to

appoint him as Chairman of NBP, he has to resign from the Board of SBP

being a Director. These facts clearly spell out that officials of Ministry of

Finance have some personal relationship with Zubyr Somroo, who floated

his name though I have called a concise report from the Finance

Division (Respondent No.2) in which it was specifically written that


Finance Division was in search of potential / competent candidates

evaluating the known professional bankers of the country though there is

no structured concept provided by the Finance Division as to how they

came to know about Zubyr Somroo to be the most competent professional

banker for such position. Such silence in the para-wise comments gives a

different meaning to accommodate the respondent in such position

knowingly that any person who is on the Board of Directors of SBP could

not be appointed as Chairman of the NBP as SBP is the master regulator of

all the banking companies and banks. In order to accommodate Zubyr

Somroo, his name has also been placed in the list of professional bankers to

put him within eligibility and qualification factor for the appointment

against the post of Chairman NBP and this aspect has also been

acknowledged by the Finance Division in their para-wise comments by

referring that, since his term was to expire on 21.03.2019 after which he was

proposed to be appointed as Chairman NBP his name was added in the panel of

professional bankers. This unqualified admission further casts doubt upon

the entire selection process adopted by the Finance Division for the

selection of Zubyr Somroo.

34. This Court has also been guided by the principles settled in Quranic

Injunctions in Surah An-Nisa, Yusuf and Al-Qasas for the selection of any

person of authority or public servant in the following manner:

Surah An-Nisa [Verses: 58 & 59]

“(O Muslims), Allah enjoins you to give the trusts into the care of those

persons who are worthy of trust and to judge with justice, when you judge

between the people. Excellent is the counsel that Allah gives you, for Allah

hears everything and sees everything. [58]

O Believers, obey Allah and obey the Messenger and those entrusted with

authority from among you. Then if there arises any dispute about


anything, refer it to Allah and the Messenger, if you truly believe in Allah

and the Last Day. This is the only right way and will be best in regard to

the end.” [59]

Surah Yusuf [Verse: 55]

“When Joseph had a talk with the king, he said, “From now you have an

honourable place with us, and you will enjoy our full confidence.” Joseph

said, “Please place all the resources of the land under my trust for I know

how to guard them and also possess knowledge.”

Surah Al-Qasas [Verse: 25]

“One of the two women said to her father, “Dear father, employ this man

as a servant, for the best man for you to employ as a servant can be the one

who is strong and trustworthy. Her father said (to Moses), “I wish to give

you one of my daughters in marriage provided that you serve me for eight

years; and if you wish you may complete ten. I do not want to be harsh to

you; if God wills, you will find me a righteous man.” Moses replied, “Be it

an agreement between me and you. Whichever of the two terms I complete,

let there be no injustice to me after that; and Allah is a witness to what we

have agreed upon.”

35. While going through the above referred Quranic Injunctions, the

Government of Pakistan, Finance Division is under heavy onus to

demonstrate that they have selected the best person in a justiciable manner

as public trust has been imposed upon the Government to exercise their

discretionary power in reasonable and fair manner while considering the

essential conditions within the framework of law. All the judicial, quasi

judicial and administrative authorities are under legal obligation to

exercise the powers in a reasonable manner and must also ensure the

justice as per spirit of law held in 2010 SCMR 1301 (Tariq Aziz ud Din, etc.

in Human Right Case). Article 25 of the Constitution of the Islamic

Republic of Pakistan, 1973 lays down a constitutional guarantee and

equality of citizens, denial of such protection and peculiar circumstances of

the case on reasonable classification founded on intelligible differentia,

which distinguishes a person or thing that are grouped together from those

who are left out, has to be demonstrated by the Finance Division, which is


not on record. The concept of good governance is based upon exercising of

discretionary power in a reasonable and fair manner, in case of non

application of these discretionary powers in unbridled and unreasonable

manner, the entire superstructure raised for such appointment erode the

public trust.

36. The respondents have failed to demonstrate as to how and under

what intelligible differentia they have nominated Zubyr Somroo for the

position of Chairman of NBP amongst the panel of professional bankers

maintained by the SBP without an advertisement or without giving other

aspirants a reasonable opportunity to compete in the selection process.

Hence, the discretion of selection by the Federal Government for the

position of Chairman of NBP is considered to be in violation of Article 25

of the Constitution of the Islamic Republic of Pakistan, 1973 as they have

not evaluated other potential candidates for such position independently,

transparently, impartially and in unbiased manner. Similar view has also

been taken by the apex Court in case reported as 2019 SCMR 1952 (in the

matter of: Selling of National Assets including of PIAA at throwaway

prices).

37. The objection on the age has also been considered by this Court, as

such, there is no restriction of age provided in the Banks Nationalization

Act, 1974, however the suitability of the candidates for the position of

Board / Members of the NBP has to be seen under FPT Criteria, which is

silent qua the age and in Schedule-II, no age limit has been provided,

except the competence and capability, probity, personal integrity and

reputation as well as financial integrity.


38. The other objections raised by the petitioners against Zubyr Somroo

being Chairman of Board of Directors, NBP are qua the interference in day

to day affairs of the NBP, meeting with bank officers, hiring of secretarial

staff, violation of remuneration policy, charging heavy fee for attending the

meetings, enhancing the remuneration package, are relating to internal

working of the NBP, rather those are the policy matters, and internal affairs

of the NBP, which could not be interfered with by this Court. The

petitioners have neither any locus standi to question these issues unless

they are shareholders of the bank nor have they any legal relationship to

the NBP for its administrative internal control. NBP is a listed company

and its management and administration has to be seen in terms of Section

131 of the Companies Act, 2017 where every public company having share

capital, within period of 180 days from the date which company is entitled

to commence business or 9 months from its corporation, whichever is

earlier, hold a general meeting of the members of the company to be called

the statutory meeting. A statutory report has to be published and given to

members after the meeting providing details of number of shares allotted,

cash received, debentures, balance remaining in hand, preliminary

expenses of the company, name, addresses and occupation of Directors,

Chief Executive, Secretaries, Officers and Legal Advisor of the company,

approvals of meetings, underwriting contracts, etc. Similarly, any

shareholder has objection on affairs of public listed company and he is

aggrieved with the management affairs, he can raise his objection in the

annual general meeting or can initiate action in terms of Section 286 of the

Companies Act, 2017 subject to condition that he is holding not less than

10% of issued share capital of the company and he has complaint that


affairs of company are being conducted or likely to be conducted in

unlawful or fraudulent manner or in a manner not provided for its

memorandum, or in a manner oppressive to the members or any of the

members or creditors are being conducted in a manner that is unfairly

prejudicial to the public interest, such member can make an application to

the Court.

39. In view of said position, learned counsel for petitioner in W.P.

No.3205/2020 conceded that petitioner is not a shareholder of the company

nor having any interest in this case, rather he is the retired employee of the

NBP, therefore, it is necessary to look into the locus standi of the petitioner

as to whether he is entitled to file the above mentioned writ petition. In this

regard, this Court is guided by the principle settled in 2000 SCMR 1720

(Muhammad Naseem Hijazi v. Province of Punjab), wherein it was held

that under Article 199(2)(b)(ii) of the Constitution of the Islamic Republic

of Pakistan, 1973, the High Court in exercise of its constitutional

jurisdiction is competent to inquire from any person or holder of public

office to show that under what authority he is holding the office. In such

like cases where a writ of quo warranto is instituted, the duty of petitioner

is to lay information before the court that such an officer has no legal

authority to retain such office. For a petitioner who acts as an informer is

not required to establish his locus standi to invoke the jurisdiction of the

Court. In such type of cases, any person who even may not be an aggrieved

party but can move to the High Court to challenge unauthorized

occupation of the public office, on any such application the Court is not

only to see that the incumbent is holding the office under the order of

competent authority but it has to go beyond that and see as to whether he

is legally qualified to hold the office or to remain in the office, as such, the


Court shall also see if statutory provisions have been violated in making

the appointment.

40. In view of above position, the very appointment of President NBP

i.e. Arif Usmani is defective and illegal as he did not possess requisite

qualification provided in the advertisement in a particular manner qua the

subject / discipline, which is not related to the field of banking, finance,

economics, business administration, etc. although the appointment has

been made through advertisement published in dailies, on the other hand

the very appointment of Chairman NBP i.e. Zubyr Somroo is also declared

illegal, who has not been recommended through a transparent manner by

the Finance Division, especially when there was no advertisement for his

position, which reflects that other best suitable candidates have not been

given fair chance to participate in the recruitment in violation of Article 25

of the Constitution of the Islamic Republic of Pakistan, 1973, therefore, the

captioned writ petitions are ALLOWED, the appointments of Arif Usmani,

President, NBP and Zubyr Somroo, Chairman, NBP are declared to be

illegal. The other claim regarding appointment of other staff in the NBP is

out of purview of this Court as held above.

(MOHSIN AKHTAR KAYANI)

JUDGE Announced in open Court on: 29.06.2021.

JUDGE

Khalid Z.

JUDGMENT SHEET IN THE ISLAMABAD HIGH COURT, ISLAMABAD

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