Naval Farms & Naval Sailing Club case: IHC overturns single-bench verdict

ISLAMABAD: The Islamabad High Court (IHC) overturned a 2022 single-bench judgment that had declared the Pakistan Naval Farms and Naval Sailing Club, located on the banks of Rawal Lake, illegal.

A Division Bench, comprising Justice Inaam Amin Minhas and Justice Shah Rukh Arjumand,on Wednesday accepted the Intra-CourtAppeals filed against the single-bench judgment. It also set aside orders for the demolition of the club and proceedings against former naval chief Admiral Zafar Mahmood Abbasi (retd).

The appeals had been filed by the Ministry of Defence, former Chief of Naval Staff Admiral Zafar Mahmood Abbasi (retd) and other petitioners against the judgment delivered by the then IHC Chief Justice Athar Minallah in 2022.

The division bench also set aside the direction to demolish the Naval Sailing Club, as well as the order declaring the transfer of land to an office of Pakistan Navy headquarters illegal.

The court further annulled the directions concerning proceedings for alleged misconduct and criminal action against Admiral Abbasi (retd) in connection with the establishment and inauguration of the club.

The order directing the Auditor General of Pakistan to assess any loss caused to the national exchequer and recover the amount from officials found responsible was also set aside.

Admiral Abbasi (retd) was represented by senior lawyer AshtarAusaf. Sardar Ahmed Jamal and Abdul Wahid Qureshi appeared on behalf of the other petitioners.The federal government was represented by the Additional Attorney General and Assistant Attorney General, while counsel for the Capital Development Authority (CDA) also appeared before the court.

The case dates back to a petition challenging the establishment of Pakistan Naval Farms and the construction of the Naval Sailing Club near Rawal Lake.

In January 2022, then IHC Chief Justice Athar Minallah had ruled that the Pakistan Navy had no authority to directly or indirectly undertake a real estate venture unrelated to its institutional functions.

The court had declared both the Naval Farms and Sailing Club illegal and ordered the club to be demolished within three weeks.

The single bench had also held that the land occupied by the Navy near Rawal Lake had not been lawfully allotted or authorised and that the Sailing Club had been constructed on land in a protected national park area.

It had directed the relevant authorities to take over the land and proceed under the applicable law.

The court had further held that the CDA was not empowered to issue an NOC for the project and had ordered action against former naval chief Admiral (retd) Abbasi and other officers involved in the construction and inauguration of the club.

The judgment had been widely seen as a significant ruling on the limits of state institutions engaging in commercial and real estate activities. The court had questioned the legal basis for state institutions establishing housing schemes and commercial ventures, while stressing the principle that no institution was above the law.

Copyright Business Recorder, 2026