1998 PLP 103 (PLC)

AJMAL MIAN, J.

This is an appeal with the leave of this Court against the judgment dated 6-2-1994 passed by a learned Single Judge of the High Court of Sindh in Miscellaneous Appeal No.37 of 1992, filed by the appellants against the judgment dated 11-8-1992 of the Sindh Security Court No. 1, Karachi, holding that the respondent was not liable to contribute social security contribution under the Provincial Employees' Social Security Ordinance, 1965 (Ordinance X of 1965), hereinafter referred to as the Ordinance, for the period commencing from 26-7-1984 to 28-11-1984, dismissing the same by maintaining the above judgment.

2. The brief facts are that the appellant's Director through a demand letter called upon the respondents to pay social security contribution from 27-5-1984 and to get their workers registered. The respondents objected to the above demand and alleged that they had paid medical allowance to their workers up to 28-11-1984. Thereupon, the appellant filed an application under section 54 of the Ordinance on or about 1-1-1985 before the Commissioner, Social Security Institution, who allowed the same by his order dated 18-3-1986; against which the respondents filed an appeal before the Presiding Officer, Sindh Social Security Court No.

1. Karachi, which was allowed on or about 12-12-1989. Against the above order the appellant filed Misc. Appeal No.9 of 1989, which was allowed and the case was remanded to the Social Security Court No. 1, Karachi in the following terms:- "I have perused the decision of the Social Security Court as well as that of the Commissioner, Social Security. A perusal thereof would show that this aspect of the case was not adverted to by them. I accordingly accept this appeal and set aside the decision of the Social Security Court No. l and remit the case back with the direction that the parties may be allowed to lead evidence to establish whether for the period from 26-7-1984 to 28-11-1984 the medical facilities provided by the respondent to its workers were in accordance with the observations of the Supreme Court in the case of Kohinoor Chemical Company Ltd. " After the above remand order, the Social Security Court by its judgment dated 9-1-1990 held that the respondents were not liable to pay social security contribution for the above period. The appellants' aforementioned Miscellaneous Appeal also failed. After that they filed a petition for leave to appeal which was granted to consider the question, whether the facility provided by the respondents is alternate and adequate to entitle them the benefits of the judgment referred to above.

3. In support of the above appeal Mr. Farhat Ali Khan, learned Advocate Supreme Court has appeared for the appellant; whereas Mr. Ahmedullah Farooqui, learned Advocate-on-Record for the respondents, stated that he had contacted Mr. Noor Muhammad, learned Advocate Supreme Court for the respondents, who asked him to state no instructions in the Court.

4. Mr. Farhat Ali Khan, learned ASC for the appellant, has vehemently contended that the learned Social Security Court as well as the learned Judge in Chambers misapplied the ratio decidendi of the judgment of this Court in the case of Kohinoor Chemical Co. Ltd. and another v. Sindh Employees' Social Security Institution and another (PLD 1977 SC 197). According to him, once a notification is issued under the Ordinance covering the respondents, they became liable to contribute social security contribution. His further submission was that the Courts below had overlooked the evidence produced by the parties from which it was evident that the facilities which the appellant provide to the secured persons were not provided by the respondents to their workers. He also submitted that the benefits which the respondents might have provided to their workers were in addition to what had been provided under the Ordinance.

5. It will be advantageous to reproduce para. 4 at page 211 from the judgment of Kohinoor Chemical Co. Ltd. (supra), which reads asunder:-- , "(4) The arrears of contributions may not be realised from an employer for the period during which he had made alternative arrangements for affording the necessary benefits to the employees and had made a contribution in that behalf at least equal to the rate prescribed under the Ordinance and the Rules and Regulations framed thereunder. Otherwise, the realisation of arrears would mean a double levy on the employer, without any corresponding benefits to his employees. However, the existence of any such adequate alternative arrangements must be established to the satisfaction of the Social Security Institution. "

6. Keeping in view the aforementioned observation, we may now revert to the evidence of the parties on the controversy in issue. In this regard, reference may be made to page 38 of the paper book, wherein the respondents' witness, Mr. Zubair Alam Chishti, Finance and Administration Manager, has admitted as follows:-- "It is correct to suggest that we do not pay for Medical Treatment, Maternity Benefit, Dead Grant, Disablement Pension, Disablement Gratuity, Servivors' Pension, Expenses for Burial in case of death and cash benefit of seventy-five per cent to hundred per cent. of wages during the period of sickness. Voluntarily adds that instead of all these benefits we pay Medical Allowance which includes all benefits. During sickness the salary is not deducted and he is paid full salary on production of medical certificate for the entire period of sickness. It is correct to suggest that we did not get our employees registered after the promulgation of relevant notification dated 26th July, 1984. "

7. We may also refer to para. 4 of the affidavit-in-evidence filed on behalf of the appellants by S. Iqbal Shah son of Abdul Ghafoor Shah, a Social Security Officer, which reads as under:-- "

4. I say that I have not seen any evidence documentary or otherwise in the establishment of the appellant or elsewhere which would show that the appellant provided, inter alia, Sickness Benefit, Maternity Benefit, Death Grant, Medical Care during Sickness and Maternity, Injury Benefit, Disablement Pension, Disablement Gratuity, Survivors' Pension, Death Grant in case of death while in receipt of Injury Benefit or Total Disablement Pension, Medical Care in case of Employment Injury and other similar benefits which are provided by the Institution to the secured workers. " A perusal of the above-quoted portion of evidence indicates that the respondents do not pay for medical treatment, maternity benefit, death grant, disablement pension, disablement gratuity, survivors' pension, expenses for burial in case of death and cash benefit of 75 % to 100 % wages during the period of sickness. It is, therefore, clear that the payment of Rs.140 per month as medical allowance by the respondents to their workers does not cover all the above items. Hence, the conclusion recorded by the Social Security Court that the respondents had provided the benefit which the appellants were under a statutory obligation is not entirely correct. This aspect has also been overlooked by the learned Judge in Chambers.

8. We may observe that once a notification is issued under the relevant provision of the Ordinance notifying an establishment covered by the scheme, it becomes liable to contribute the social security contribution by operation of law. Similarly, the specified benefits under the Ordinance would accrue to all employees of the said Establishment who are working either in the Establishment or in connection with the work of the same as held by this Court in the case of Kohinoor Chemical Co. Ltd. (supra). The factum that the employees concerned were unable to receive the benefit under the Ordinance for want of registration of employees with the appellant in terms of the Ordinance would not, in any way, affect the liability of the Establishment to contribute the social security contribution in terms of the Ordinance and the rules framed thereunder as it cannot take benefit of its own wrong.

9. We may also refer to the judgment of this Court in the case of Shaheen Airport Services v. Sindh Employees' Social Security Institution (1994 SCMR 881), wherein it has been held that while construing a beneficial enactment, the Court can take into consideration the objects for which it was enacted and the mischief which it intended to suppress and if two possible constructions of a provision of such a statute are possible; one which favours the class of persons for whose benefit the statute has been enacted would be preferred.

10. If we were to accept the view found favour with the Courts below, it would lead to unreasonable consequences, namely, that an Establishment may not get itself registered in terms of the Ordinance and may avoid payment of social security contribution on the plea that its employees have not been granted any benefit under the Ordinance. The benefit can be availed of by the employees who are registered with the appellant by their employer in terms of the Ordinance and not otherwise, but non-registration of the employees with the appellant would not absolve the employer concerned if his establishment is notified under the Ordinance from his liability to contribute social security contribution.

11. We are, therefore, inclined to hold that the Sindh Social Security Court and the learned Judge in Chambers have misapplied the ratio decidendi of the judgment of this Court in the case of Kohinoor Chemical Co. Ltd. (supra). The upshot of the above discussion is that the appeal is allowed; the judgments of the Social Security Court and of the learned Judge in Chambers under appeal are set aside. However, there will be no order as to costs. M.B.A./S-25/S Appeal allowed.