The counsel for the Pakistan Steel Mills (PSM) on Tuesday apprised the Supreme Court that the PSM had suffered a loss of Rs 26.5 billion during the year 2008-09.

Appearing before the three-member bench of Chief Justice Iftikhar Muhammad Chaudhry, Justice Khilji Arif Hussain and Justice Tariq Parvez on a suo motu case regarding alleged corruption in the PSM, Fakkhruddin G. Ebrahim submitted a forensic audit report consisting of nine volumes.

Ebrahim apprised the bench that from the final report of July 27, 2011, a total of Rs 26.5 billion loss was detected during the 2008-09, out of which Rs 4.68 billion was incurred in category of business loss, Rs 9.99 billion due to corrupt practices and Rs 11.48 billion due to mismanagement.

He said before submission of the report by M/s Avais Hyder Liaquat Nauman, Chartered Accountants, the Federal Investigation Agency (FIA) had taken notice of 10 cases in which involvement of PSM officials and other private persons was suspected.

The FIA lodged 10 FIRs against 51 nominated traders, consumers, contractors, besides, nomination of ten officers and PSM employees, he added.

The counsel further said that in category of corrupt practices, the FIA had proceeded against the accused, registering 10 FIRs which had been pending before the relevant courts.

He said that all the accused were on interim bails, except former PSM Chairman Moin Aftab Sheikh, who though arrested, was allowed to remain in hospital on medical grounds. Five additional complaints were also lodged with the FIA through a letter of November 11, 2011 moved under an advice of the Ministry of Production, he added.

The Chief Justice observed that the FIA should have moved in the case and that the PSM was not being run smoothly as it had been suffering losses to tune of billions of rupees.

He also questioned as to why the ministry concerned remained inactive after receiving the forensic audit report. The bench observed that it was not known how much loss had been occurred in this organization.

Gul Muhammad Rind, Secretary Industries, appeared and stated that the forensic audit report was received by the ministry about six months back. To a bench's query, he explained that the ministry was contemplating to refer the matter to the National Accountability Bureau regarding all the cases.

The Chief Justice told him that it was upto them to take a decision in this regard. The bench said that they were surprised to note that no steps had been taken so far by the ministry despite the fact that the Pakistan Steel Mills was not being run properly.

The bench directed the Secretary Production to explain on next date of hearing what steps they had taken against the persons identified in the report.

Further hearing was put off till March 15.