Sindh High Court summons FIA chief in pleas against notices for banking records of Cotton Exchange directors, tenants
KARACHI: The Sindh High Court has summoned the director general of the Federal Investigation Agency (FIA) in petitions challenging the notices issued by the agency to commercial banks seeking banking records of current and former directors of the Karachi Cotton Exchange and others.
A two-judge constitutional bench headed by Justice Adnan-ul-Karim Memon also restrained the FIA from taking any coercive action against the petitioners till April 16.
The bench allowed the FIA to continue to proceed with the matter in accordance with law and also issued notices to the additional attorney general and advocate general for the next hearing.
However, it directed the FIA chief to explain on the next date the conduct of agency officials when the court had reserved for order the similar issue.
Constitutional bench restrains the agency from taking any coercive action against petitioners
The Karachi Cotton Exchange and its many members and tenants including Sharik Bashir, Arif Piracha, Amin Hashwani, Nadeem Maqbool filed three petitions in the SHC impugning the notices issued under the Anti-Money Laundering Act (AMLA) 2010 seeking their detailed banking records from all commercial banks.
They named the ministries of interior and religious affairs, Karachi Metropolitan Corporation (KMC), Evacuee Trust Property Board (ETPB), FIA and others as respondents.
The petitioners’ counsel — Anwar Mansoor Khan, Arshad Tayebaly, Haider Waheed and others — submitted that the impugned notices were issued under Section 25 of the AMLA in a case (FIR No. 37/2025) to the banks seeking financial information of the Karachi Cotton Exchange, its members and tenants without any predicate offence.
The counsel argued that the questions regarding the ownership of Cotton Exchange Building were sub-judice before the SHC as it had already reserved its judgement on a set of petitions filed about the ownerships of the subject property.
They also stated the Karachi Cotton Association (KCA) has been in lawful possession of the property in question since 1936 through a registered conveyance and valid lease from the KMC and the association had provided offices in the subject property under the valid rental agreements to its members engaged in cotton related businesses.
They contended that despite the ongoing judicial proceedings challenging the property’s alleged evacuee status, the ETPB and FIA had unlawfully sealed the property on Dec 12, 2025 forcibly evicting tenants and later trespassed into the offices. The counsel maintained that the FIR/inquiry and impugned notices were lodged and issued without jurisdiction and as part of a fishing and roving expedition intended to harass their clients and force them to surrender their lawful rights over the subject property as no offence existed and the ownership of the property remained undecided.
The lawyers for the petitioners also argued that these actions were taken on the mistaken premise that the building was an evacuee trust property and their clients had allegedly caused a loss of over Rs15 billion, though no methodology for this calculation was explained.
They highlighted interim orders passed by the SHC in earlier petitions restraining the FIA and ETPB from taking coercive action against the petitioners and other occupants.
However, they contended that despite existing restraining orders and pending adjudication, the FIA attempted to occupy the building, creating a conflict of interest and acting in bad faith.
The counsel argued the petitioners have fully complied with statutory and regulatory obligations and there was no nexus between their financial affairs and any alleged wrongdoing while these notices were unlawful.
The petitioners asked the SHC to declare the impugned notices and FIR/inquiry illegal and restrain the respondents from taking coercive action against them.
The bench in its orders said, “Notice be issued to Director General, Federal Investigation Agency, who shall appear in person on the next date of hearing.
“Meanwhile, no coercive action shall be taken against the petitioners in terms of notices dated 30.01.2026, 06.02.2026 and 13.2.2026. However, they may continue to proceed with the matter in accordance with law. In the meanwhile, notice be issued to the additional attorney general and advocate general Sindh for 16.01.2026,” the order concluded.
The same bench had already heard and reserved its judgement in four identical petitions filed by the KMC and others pertaining to the subject property and against the FIR.
At a previous hearing, the FIA had informed the SHC that the FIR in question was being treated as an inquiry and the procedure under the FIA Act 1974, FIA Inquiry and Investigation Rules and standard operating procedure will be followed and after approval of the competent authority, the FIA will proceed with the matter in accordance with law.
In the impugned notices, the FIA has alleged that the “illegal occupation” of retrieved federal government property has caused a loss of nearly Rs16 billion to the national exchequer.
Published in Dawn, April 2nd, 2026
