P L D 1964 Karachi 337 (PLP)

I will discuss these points separately.

4. In support of his contention that the demand for re instatement of Abdul Aziz was barred by the Award dated 29th March 1962, the learned representative of the appellant has referred to section 14 of the Industrial Disputes Ordinance, 1959, which is reproduced below :‑ "Period of operation Settlement and Awards :‑‑ (1) A settlement shall come into operation on such date as is agreed upon by the parties to the dispute, and if no date is agreed upon, on the date on which the memorandum of the settlement is signed by the parties to the dispute. (2) Such settlement shall be binding for such period as is agreed upon by the parties, and if no such period is agreed upon, for a period of one year from the date on which the memorandum of settlement is signed by the parties to the dispute and shall continue to be binding on the parties after the expiry of the period aforesaid, until the expiry of two months from the date on which a notice in writing of an intention to terminate the settlement is given by one of the parties to the other party or parties to the Settlement. (3) An (award published under subsection (2) or sub section (2‑B) of section 12 shall come into operation on such date and remain in operation for such period ; not exceeding one year, as may be specified in the award Provided that before the expiry of the said period the Court may, upon an application of any party bound by the award, by an order :‑ (i) extend the period of operation of the award by any period not exceeding one year at a time as it thinks fit, so, however, that the total period of operation of any award does not exceed three years from the date on which it came into operation ; or (ii) terminate the period of the award so specified or extended, on a date fixed by that order on the ground of material change in the circumstances on which the award was based. (4) Nothing contained in subsection (3) shall apply to any award which by its nature, terms or other circumstances does not impose, after it has been given effect to, any continuing obligation on the parties bound by the award. (5) Notwithstanding the expiry of the period of operation under subsection (3), the award shall continue to be binding on the parties until the expiry of two months from the date on which a notice in writing of an intention to terminate the award is given by one of the parties to the other party or parties to the award." For the disposal of this appeal only sections 14(3) and (5) are relevant. It will be significant to note that under subsection (3) an award remains into operation for such period not exceeding one year as may be specified in it, from the date of its publication in the Official Gazette. On the terms of this subsection the power to terminate or extend the period of the award can only be exercised by the Industrial Court upon an application of a party bound by the award. In subsection (5) it is provided that not withstanding the expiry of the period of operation under sub section (3), the award shall continue to be binding on the parties until the expiry of two months from the date on which a notice in writing of an intention to terminate the award is given by one of the parties to the other party or parties to the award.

5. In order to appreciate the point raised by the appellant it is necessary to state certain material facts. In September 1961, certain demands were made by the respondent Union which also included the question of the re‑instatement of Abdul Aziz as item No.

14. In respect of these demands on 9th September 1961, conciliation proceedings commenced which failed on 25th September 1961. This was followed by an application under section 5 (5) of the said Ordinance by the respondent Union. In November 1961, the workers of the Packing Department resorted to go "slow" which resulted in the suspension of 28 operators. This led to a strike on the part of the workers and eventual dismissal of 23 workers. It resulted in the total suspension of the appellant‑company. At last on the intervention of Lt. General W. A. Burki, the then Labour Minister, on 6th February 1962, there was an agreement between the parties which was in the nature of settlement. According to this settlement the respondents agreed to withdraw all the demands pending before the Industrial Court. Later on this settlement was repudiated by the respondent Union in the proceedings before the Industrial Court, which by an award dated 29th March 1962, published in the Government Gazette dated 10th April 1962, declined to adjudicate upon the respondents' demands including the demands under consideration holding them as frivolous and vexatious on the basis of the settle ment between the parties dated 1‑7‑1960 and 6th February 1962.

6. In the, light of the above‑mentioned fact, Mr. Z. A. Ansari, contended that the said award was binding upon the parties and the demand under consideration should not have been allowed to be re‑agitated before the Industrial Court in later proceedings op. the ground that these disputes were covered by an effective settle ment between the parties followed by a valid award, which was still operative. This argument has not impressed me. Admittedly the award dated 29th March 1962, was not given on merits. Besides it is not one of those awards which by its nature, terms and other circumstances, imposed or gave effect to any continuing obligation on the parties bound by the award and having regard A to section 14 (4), it is not covered or affected by section 14 (3) o section 14 (5). It is quite obvious that the restrictions imposed by these subsections are not applicable to such awards and the disputes covered by such awards, if re‑agitated, cannot be thrown out on the mere ground that the operative period of the award has not come to an end. It is, therefore, not open to the appellant to contend that the question of re‑instatement of Abdul Aziz could not be reopened, as the operative period of the said award has not expired or notice in writing of an intention to terminate the award has not been given.

7. The utmost that can be argued on behalf of the appellant is that on the principle of res judicata, the question of the rein statement of Abdul Aziz should not have been allowed to be raised before the Industrial Court. It is well established rule of law that in order to support a plea of res judicata the formed' decision must have been on the merits of the question in issue in the subsequent litigation. Admittedly in the present case the question of re‑instatement of Abdul Aziz was at no time decided on merits. There is no finding on merits about this demand. I, therefore, hold that the contention of the appellant cannot be upheld on this ground.

8. Apart from this, the appellant‑company is itself respon sible for reopening the question under consideration. There is overwhelming documentary evidence on the record to establish the fact that in spite of the award dated 29th March 1962, there was no industrial peace in the appellant's factory at Mauripur in order to avoid further trouble the appellant‑company by its letter dated 5th June 1962, showed willingness to discuss all the demands which according to them were effectively settled under the above‑mentioned award of the Central Industrial Court. It was for this reason that the respondent's Union submitted on 15th June 1962, a charter of demands which also included the question under consideration. On 20th June 1962, the appellant‑company informed the respondent Union that if there was no agreement at factory level, the dispute will be referred to the Central Industrial Court. On 5th July 1962, the appellant‑company called upon the respondent Union to advise the names of the representatives of the Union, who negotiated in respect of the above demands. It is admitted that these negotiations did not have any fruitful result. The conciliation proceedings failed and a certificate of failure dated 10th September 1962, was obtained by the appellant company. About this time three office‑bearers of the respondent Union went on hunger strike. Consequently on 24th October 1962, the appellant‑company took the entire dispute to the Indus trial Court for adjudication which resulted in the award under appeal.

9. It will thus be noticed that the appellant‑company was itself responsible for reopening the entire dispute between the parties including the demand under consideration and brought the dispute before the Industrial Tribunal for adjudication. In these circumstances it is perfectly clear to me that in law the appellant company is estopped from contending in these proceedings that the question about the re‑instatement of Abdul Aziz could not be reopened in view of the award dated 29th March 1962. Mr. Ansari made a feeble attempt to argue that there is no estoppel against statute, but his contention has no force. As already observed the award referred to is not one of those awards which by its nature, terms or other circumstances imposed, after it has been given effect to, any continuing obligation on the parties bound by the award. It is outside the purview of section 14(3) and (5) and the restriction of not reopening the demand up to a certain time limit is not in the way of the respondent Union. The appellant's con tention that no estoppel can be pleaded against a statute has no force and is repelled. In view of the above discussion, I am satisfied that the learned Industrial Court was perfectly justified in considering the question of the re‑instatement of Abdul Aziz and there was no bar in its way to decide the question on merits.

10. I will now take up the question whether the appellant company was ,justified in terminating the service of Abdul Aziz. The case of the appellant‑company is that Section‑man Abdul Aziz's services were terminated in the ordinary course of business under Standing Order No. 12 (1). It is no doubt correct that accord ing to the view of the Supreme Court in Karnaphully Paper Mills Ltd. v. Workers Union (P L D 1961 S C 329), "in the case of private employment, the ordinary rule of master and servant must be sustained, namely, that without cause assigned the master may dispense with the services of the servant with notice or can payment of salary in lieu of notice". But this is not a case of termination of service simpliciter. It was admitted by the appellant‑company in their letter dated 28th July 1960, Annexure 43, to the Labour Commis sioner that the services of Abdul Aziz were terminated on payment of one month's pay In lieu of notice on the ground of his prolonged absence. Mr. Ansari also admitted before me that the Management of the company is faced with a difficult situation, in those cases where the employees absent themselves without reasonable cause and the appellant‑company had no other course but to terminate the service of such servants. It is, therefore, one of those cases in which it was open to the Industrial Court to consider the bona fide of the appellant in terminating the service of the workman concerned. On consideration of these facts in my view the service of Abdul Aziz cannot be said to be terminated for bona fide reasons. It is abundantly clear that his service was terminated in order to make it clear to the other employees that the appellant‑company would not show any indulgence to those workers who prolong their earned leave on false pretext and lame excuses. But for this purpose the appellant should not have resorted to employ Standing Order No. 12 (1). There is a specific provision in the Standing Orders to meet such situation namely Order 13 (3) (e) which treats the case of habitual absence without D leave or absence without leave for more than 10 days as miscon duct resulting in the dismissal. If the appellant‑company was satisfied that Abdul Aziz was guilty of prolonged absence, it was incumbent on it to take action under this Standing Order and not to have resorted to Standing Order 12 (1) which is applicable to a different situation altogether.

11. The appellant‑company's contention that there was no nexus between the termination of Abdul Aziz's employment and the dispute raised by the Union in September 1962, has no force. It is quite correct that his services were terminated on 17th June 1960, but this issue remained alive. Not only the worker con cerned persued his case but the other workers throughout supported his cause. Even the appellant‑company, besides giving assurance to the Labour Commissioner to employ him, discussed his case in September 1962, with the respondent Union. In these circumstances his case is covered by the principle laid down by the Pakistan Supreme Court in the case of National & Grindlay Bank v. East Pakistan Bank Employees (1961 P L C 1022). I would, therefore, repel the technical objections and proceed to consider the pro prietary of the impugned order.

12. I would now consider the case of Section‑man Abdul Aziz on merits. He was employed on a permanent job for about ten years and on 21st March 1960, proceeded on annual leave. While on leave be fell ill and requested for further leave on the basis of a medical certificate of the Civil Surgeon of Abbottabad, who recommended for 1J months leave. No objection was taken on this certificate and the appellant‑company granted him leave from 4th May to 16th June 1960. By this time, he did not recover from illness and had to apply for further leave and in support again submitted another certificate of the Civil Surgeon concerned. Instead of considering the genuineness of the reason submitted by Section man Abdul Aziz, by letter dated 16th June 1960, the company terminated his service with effect from 17th June 1960, on the ground that he was physically unfit. In the circumstances of this case the learned Industrial Court was per fectly justified in finding out the real nature of the order passed by the appellant‑company. Its conclusion that the service of Abdul Aziz, Section‑man was not terminated in the ordinary course of business are fully justified on the facts disclosed on the record. In law it is the duty of the company in such cases to consider the reasonableness of the demand of an employee. The proper pro cedure for an employer in such cases is first to find out whether the workman concerned is ill or not. It is only when the employer is satisfied and comes to the conclusion that the workman is making lame excuses that he is entitled to dispense with the service of an employee. Unfortunately in the present case no such steps were taken. The appellant‑company did not even ask Abdul Aziz to get himself examined by a doctor of its own choice for satisfying itself whether the ground of illness was genuine or not. I, therefore, find no force in the grievance of the appellant in respect of the re‑instatement of Abdul Aziz and fully agree with the reasoning given by the learned Industrial Court for his re‑instatement.

13. The case of Khan Muhammad stands, however, on a different footing altogether. Workman Khan Mohammad also proceeded on annual leave. While he was on leave he fell sick and sent a medical certificate of Medical Officer, who recom mended for him six weeks' leave. According to the certificate (Annexure 51) the Senior Medical Officer, Saidoo Shareef, Sawat State, certified that the workman Khan Muhammad was suffering from dysentry for which he was under treatment as an out‑door patient. He, therefore, recommended that he should be granted six weeks' extension of leave. In my opinion, on the basis of this certificate the company was perfectly justified in granting him two weeks' leave which was due to him. He should have reported on duty on 11th June 1962, but failed to do so. He did not submit any certificate about his further illness. In these circumstances the appellant‑company was perfectly justified in treating his case under Standing Order No. 8 (3) which is in the following terms :‑ "(3) If the workman remains absent beyond the period of leave originally granted or subsequently extended, be shall lose his lien on his appointment unless he (a) returns within 8 days of the expiry of the leave and (b) explains to the satisfaction of the manager his inability to return before the expiry of his leave. In case the workman loses his lien on his appointment, he shall be entitled to be kept on the 'badli' list." Khan Muhammad returned and reported to the Personnel Manager on 6th July 1962. and produced the fitness certificate, but the explanation given by him was not found satisfactory and his lien was considered to be terminated under the above‑mentioned Standing Order. In my opinion, the appellant‑company was perfectly justified in not accepting the explanation of Khan Muhammad and dispensing with his lien on the job held by him. But while acting under Standing Order No. 8, the appellant company failed to observe its other requirement. Under this rule it is necessary for an employer to keep such workman on the "badli list". Admittedly this was not done. I would, therefore, hold that although Khan Muhammad had lost his lien on the post held by him, he continues to be on the 'badli list' of the appellant company.

14. After careful consideration of the points raised by the parties, I maintain the order of the Industrial Court in respect of the re‑instatement of Abdul Aziz. I would, however, set aside the order of the Industrial Court about the re‑instatement of Khan Muhammad and hold that he continues to be on the 'badli list' of the appellant‑company and whatever advantages are available to him would be given to him.

15. In the result, subject to the above, the appeal is partly allowed against Khan Muhammad as indicated above. In the circumstances of the present case I would direct the parties to bear their own costs. K. B. A. Appeal partly accepted.