1986 PLP 405 (CLC)

Rodgrigues Ishrat Jehan 9. (Sd.) 10. (Sd.) A. Rehman M.S. F. Rifat. 11. (Sd. ) 12. (Sd. ) Hap Haroon Tayub Rashid Soorty. Dated 11‑10‑1983. Applicant Abdul Razzak and respondents M. A. Wajid Jawad, Mustafa Qassam and Rashid Soorty have signed this compromise. In pursuance of compromise, the suit filed by respondent Soorty was withdrawn. However, the Managing Committee, after obtaining legal advice, came to the conclusion that the compromise contemplated re‑election for the vacant seats, was not covered by any of the clauses of the Articles of Association and as such it was illegal and ineffective. Under these circumstances there was no alternative for the Committee but to accept the result of elections already held on 28‑9‑1983 as stated above. It was, therefore, decided that a General Body meeting may be called for 18‑10‑1983 for announcing the result of election of the members and office‑bearers of the Committee. According to the Industries (respondent No.l), M.A. Majid Jawad (respondent No.3) is now legally elected Chairman of the Committee, while Abdul Razzak Rajwani is only a member of the Committee as he had automatically ceased to be the Chairman in June 1983 on expiry of his term as such. The only formality that remained to be performed was the announcing of the result of the election in the annual general meeting of the General body of the Association, as contemplated by Article 32(ii). All these facts which have so far been stated are not denied by the parties. The grievance of the Industries is that in spite of the result of the elections held on 28‑9‑1983 and the compromise having been declared to be illegal, applicant Abdul Razzak Rajwani is still insisting on exercising the powers of .Chairman of the Committee. These were the circumstances under which the industries` filed the suit for declaration and injunction, in which the impugned orders were passed. In the suit (S. No. 4576 of 1983) filed by them in the Court of IIIrd Senior Civil Judge Karachi on 31‑12‑1983 following reliefs were sought: (i) To declare that the defendant No.l has been retired from the Office of Chairman of defendant No.2 with effect from June, 1983 and as such the defendant No.l is now so more Chairman of defendant No.2 with effect from 28‑9‑1983. (ii) To declare that defendants Nos. 3 and 4 and 5 are the duly elected Chairman and Vice‑Chairmen of defendant No.2 for the year 1983‑84 with effect from the date the result of the election of office‑bearers held on 28‑9‑1983 was declared and as such the defendants Nos. 3 and 4 and 5 are now only entitled to work and to act as Chairmen and Vice‑Chairmen of the defendant No..2. (iii) To declare that defendants Nos. 1, 3, 5 and 6 are newly and duly‑elected members of the Managing Committee as per election held on 15‑9‑1983 and as such the said defendants are now entitled to act as member of Managing Committee. (iv) To declare that the compromise /settlement dated 11‑10‑1983 for the re‑election (Annexure 'I' of this plaint) is illegal, void, unauthorised and is of no legal effects. (v) Permanent injunction restraining defendant No‑1 from working, using and exercising the power of the Chairman and to act as Chairman of the defendant No‑2 in any manner. (vi) Permanent Injunction restraining the defendant No.1 from representing himself as Chairman of defendant No.2 in any manner before any person /authority/Orgnization or anywhere in any manner and the defendant No.1 may also be restrained from performing any duty as Chairman and or from availing any benefit or privilege appertaining to the said office of the Chairman of the defendant No.2. (vii) Permanent injunction restraining the defendant No.1 from managing, controlling and administering the affairs of the defendant No. 2 as its Chairman in any manner. (viii) Mandatory Injunction directing the defendants Nos. 3 and 4 and 5 to work and to act as Chairman and Vice‑Chairmen of the defendant No. 2 for all purposes in accordance to the Articles of Association. (ix) Mandatory injunction direction the defendants Nos. 2 and 10 to call a general body meeting of the members of defendant No.2 for the announcement of the result of the election for the year 1983‑84 held on 15‑9‑1983 and 28‑9‑1983 and to announce the result of election therein accordingly. (x) Permanent injunction restraining all the defendants from implementing and acting upon the compromise/ settlement dated 11‑10‑1983 (Annexure '1' of this plaint) in any manner. (xi) Cost of suit. (xii) Any other relief which this Honourable Court deems fit and proper under the circumstances of this case." Alongwith the plaint the Industries i.e. plaintiff /respondent No. 1, also filed an application for appointment of Receiver to look after and manage the affairs of the Association. Another application was made praying that the applicant /defendant No.1 should be restrained from calling himself as Chairman and exercising the power of Chairman during pendency of the suit. The learned Civil Judge, after narrating the facts in detail, came to the conclusion that respondent No.1 had ceased to be the Chairman automatically in terms of Article 32(iii) of the said articles and that he was not entitled to exercise Chairman's functions. He further came to the conclusion that the affairs and management of the Association cannot be left in vacuum and that it was necessary to appoint some Receiver to manage its affairs and that respondent No.3 was the fittest man for this purpose as he had also the support of the majority of the members of the Committee. Even the members whose nomination papers were rejected, have not challenged his election. One of them namely, Rashid Soorty, respondent No.7 had withdrawn his suit and not contested the right of respondent No.3 to act as Chairman during the pendency of the suit. Consequently the Civil Judge passed the first impugned order in the case which is dated 24‑i‑1984 referred to above. This order was challenged in appeal being Civil Miscellaneous Appeal No. 35 of 1984 which was decided by the 11Ird Additional District Judge, Karachi on 4‑3‑1984 as stated above. The above two orders have been challenged by applicant (defendant No.1 in the suit) mainly on the ground that the civil suit filed by the Industries (respondent No.1 was barred .by section 12 of the Trade Organizations Ordinance, 1961 (hereinafter referred to as the Ordinance). It may be stated that this plea was not raised either before the trial Court or before the first appellate Court. But since the plea relates to the very jurisdiction of the Court, hence it was allowed to be set up and the revision application was admitted mainly on this ground. Alongwith the revision application, the applicant has also filed an application (C . M . A . . No. 357 of 1984) praying that operation of the order of IIIrd Additional District Judge, Karachi dated 3‑4‑1984 in Civil Appeal No. 35 of 1984 be suspended. On this application notice was ordered by this Court and meanwhile ad interim stay as prayed was also granted on 23‑4‑1984. Messrs S. Ishtiaq Ali and Syed Zia Abbas filed powers on behalf of respondents Nos. 1 and 3 and also filed two applications (C . M . A . No. 390 of 1984 and C . M . A . No. 391 of 1984) on behalf of respondents Nos. 1 and 3 respectively. In the first application a prayer was made that applicant Abdul Razzak Rajwani may be restrained from taking charge of the Association as the receiver had already taken charge of the management and administration of the Association by virtue of the order of the trial Court and appellate Court before ad interim order dated 23‑4‑1984 was passed by this Court. In C.M. A. No. 391 of 1984, prayer was made on behalf of respondent No.1 that ad interim order dated 23‑4‑1984 may be recalled. These two applications were put up before me for orders on 25‑4‑1984. Notices were issued to the applicant's counsel of these applications. The question of removal of respondent No.3 as interim Receiver was, however, left open to be considered at the time of hearing of the above C.M.As. These observations in the order dated 25th April. 1984 were necessitated on account of statement of Messrs Syed Abbas Zia and Syed Ishtiaq Ali to the effect that ad interim order did not specifically contemplate removal of respondent No.3 as interim Receiver, who had already taken over the administration of the Association. It may be stated that although applicant Abdul Razzak Rajwani had no prima facie title or right by .virtue of any provision of Articles or Memorandum of Association to continue to act as Chairman of the Association after expiry of his term in June 1983, he continued to write letters designating himself as Chairman. Even after the filing of this revision application and passing of the ad interim order, he issued certain letters through the Secretary of the Association in which he designated himself as Chairman of the Committee. On the other hand respondent No.3 also continued to exercise powers of interim Receiver not only on the basis of the two impugned order of the Senior Civil Judge and Additional District Judge, but on account of observations made by this Court in the order dated 25‑4‑1984 to the effect that the question of removal of respondent No.3 as interim Receiver shall be considered at the time of hearing of the interim applications. Meanwhile both the applicant and respondent No.3 were aggrieved on account of the conduct of each other so far as it related to the exercise of powers on interim Receiver. M. A. Wajid Jawad, respondent No.3, therefore, filed Criminal Original Miscellaneous Application No. 4 of 1984 against the applicant for contempt of the Court on the ground that the applicant was insisting even after the interim order, on designating himself as Chairman of the Committee, although the interim order dated 24‑4‑1984 did not authorise him to act as Chairman. On the other hand an application was also moved on behalf of the applicant being C.M.A. No. 845 of 1984 under Order XXXIX, rule 2(3), C.P.C praying that respondent No.3, M.A. Wajid Jawad be punished for deliberate violation of the stay order passed on 23‑4‑1984, whereby the orders of the subordinate Court appointing him as Receiver were stayed. The main petition, the interim applications and the two contempt applications were heard together and are being decided by this order. The main objection which has been urged in support of the revision application by Mr. Ali Ahmed Fazeel, learned counsel for the applicant is that the suit filed by the Industries (respondent No.l) is hit by the mischief of section 12 of the said Ordinance. It is not disputed that the Association has been registered under the relevant provisions of the said Ordinance and that the provisions of the Ordinance are applicable to it. It is, therefore, to be seen whether section 12 of the said Ordinance will bar this suit. Subsection (1) of section 12 is relevant for the purpose of deciding the question under consideration. It is reproduced hereunder:‑

"12.‑‑(1) Notwithstanding any thing contained in any law for the time being in force or in the articles or memorandum of a registered trade organization, no suit or other legal proceedings shall be instituted or commenced against such registered trade organization (or any member thereof or any member of Executive Committee of such trade orgnization) questioning the validity or propriety of any act or proceedings of such trade organization of the Executive Committee or other body thereof or the constitution of, or election or appointment to such Committee or body, by any member of such trade organization or by, any member of, any other trade orgnization unless such member or other trade organization has made an application, accompanied by such fee not less than one thousand rupees as may be prescribed by rules, referring the matter to the Arbitration Tribunal constituted for the purpose of deciding 0eh references by the Federation of Chambers of Commerce and Industry registered under the Act in pursuance of a licence and such Arbitration Tribunal has given its decision 'or award thereon." From the above provisions it would appear that the Ordinance bars civil suit under two circumstances; namely. (1) if the suit relates to questioning the validity or propriety of any act or proceedings of such trade organization or of the Executive Committee or other body thereof and (2) that the suit relates to questioning the constitution of or the election or appointment to such Committee or body by any member of such trade organization or by any other trade organization. If these two circumstances are shown to be the subject‑matter of a suit, then, of course, the suit shall be barred under section 12 of the said Ordinance and the only remedy for the aggrieved party shall be to approach the Arbitration Tribunal as contemplated in the above section itself, as constituted for the purpose by the Federation of Chambers of Committee and Industries. In support of the above plea Mr. A. A. Fazeel, learned counsel for the applicant, has relied on a Full Bench decision ‑of Lahore High Court in the case of Sultan Ali Najghiana v. Nur Hussain reported in A I R 1949 Lah.

131. The subject‑matter of dispute in the above decision was infringement of election rules by a candidate. It was contended that a petition based on infringement of election rules was exclusively triable by a Tribunal constituted under the election laws and that the jurisdiction of Civil Court was barred in respect of such matters. The contention was upheld by the Full Bench in the following words:‑

"Electoral right which may generally be defined as the right to vote at an election or the right to be elected as a member of Legislature or the privileges and disabilities attaching to the status of a person when elected as a member, is purely a creation of Constitution Act. Several functionaries are entrusted with the duty of adjudicating on the rights of persons who claim the right to vote or the right to be elected as members and finally there is the Provision (Para. 2, Part 3, Government of India Provincial Elections Corrupt Practices and Election Petitions Order 1936) that an election shall not be called in question except by an election petition and that all applications in connection with such petition have to be made to the Election Petitions Commissioners, to be nominated by the Governor, who are enjoined to hold an enquiry into the allegations contained in petition in the same way as if the proceedings were a suit and to submit the result of their enquiry in the form of a report to the Governor whose orders thereon are declared to be final, Though there is no express provision, from the tenor of these various provisions it can be inferred with sufficient certainty that all disputes relating to elections were intended by the Legislature to be entrusted for investigation and determination to the several functionaries mentioned therein to the exclusion of the civil Courts. " . The next case cited in this connection is Dost Muhammad Malik v. Returning Officer and others P L D 1965 Lah.

560. This was also an, election matter in which the point involved was whether the High Curt could take cognizance of a matter which could have been challenged only by filing an election petition before an Election Tribunal. It was held by the Full Bench which decided the case that the jurisdiction of the High Court to deal with the matter was barred. Reliance has also been placed on the decision of a learned Single Judge of this Court in Amin Cotton Company v. Karachi Cotton Association, P L D 1968 Kar.

797. Ali v. Nur Hussain in respect of conditional ousting of Civil Court's jurisdiction in cases where the rights created by the statute ‑may be agitated before a Tribunal constituted under the statute has or has not come into existence, observed as under:‑

"If Courts have jurisdiction to examine whether a tribunal has exceeded the jurisdiction, then at least in respect of common law rights, the jurisdiction of Courts cannot be barred when no tribunal has been set up' under an act which purports to exclude the jurisdiction of the Courts. In my opinion, the ratio decidendi of the judgment of Mr. Justice Munir is that when rights created by statute are required by that statute to be adjudicated only by a tribunal to be set up under that statute, then the Civil Courts have no jurisdiction to grant relief. But where, as in the case under appeal a statute confers exclusive jurisdiction on a tribunal for determining claims in respect of common law rights, then the jurisdiction of the Courts will not be excluded until the tribunal required by the statute is set up." It may be remembered that where jurisdiction of a civil Court is barred by a statute, then the provisions barring the jurisdiction should be construed strictly. Reference in this connection may be made to a Full Bench decision of Lahore High Court in the case of Ali Muhammad v. Hakim and others A I R 1928 Lah. 121 in which the Full Bench observed as under:‑

"The Court must, no doubt, give effect to the language of the statute, which, either by express words or by plain and necessary implication, takes away the jurisdiction of the ordinary Courts. But it is a well‑established doctrine that a statute interfering with the established state of law must receive a strict construction, and that, when its language is doubtful, the Courts should lean against an ouster of the jurisdiction of the ordinary tribunals. Neither the language of the section which to my mind is not open to any ambiguity or doubt nor any principle of law can warrant the contention that the Collector should intervene in a dispute between private persons and that the Civil Courts should be debarred from adjudicating upon it. My answer to the question submitted to the Full Bench is, therefore, in the affirmative. " In the present case the jurisdiction of Civil Court shall be barred only if the reliefs sought fell squarely within the mischief of section 12 of the Ordinance. The various reliefs which the plaintiff respondent No.1 has sought in his plaint have already been narrated. Some of the items of the relief do come within the mischief of section 12 of the said Ordinance. But the main emphasis of Mr. Syed Ishtiaq Ali, learned counsel for the respondent No.l, is on item No.4 of the relief which is to the effect that the compromise dated 11‑10‑1983 contemplating re‑election be declared to be illegal, void, unauthorised and of no legal effect. He has contended that the compromise does not fall within the Articles or Memorandum of the Association nor it is between members of the Association or members of the Committee. This compromise was arrived at between some members who were already elected as members of the Committee and some other persons who were either not elected or who were not members of the Committee. However, the main ground which has been urged to nullify the compromise is that it contemplates re‑election of the members of the Committee for which there is no provision at all in the Articles of Association and moreover the Committee itself has rejected this compromise. There is much force in the contention of Mr. Syed Ishtiaq Ali. What the plaintiff has sought by the Civil Court is the declaration that the compromise entered into between certain parties is not covered by any of the provisions of the Articles of Association and as such it should be declared ineffective particularly for the reason that the Committee itself has rejected this compromise. The plaintiff respondent No. l has not questioned the validity or propriety or any act or proceedings of the organization or of the Executive Committee. Nor has he challenged constitution of or appointment to such committee or body of the organization. What he seeks is declaration that the applicant has ceased to be Chairman on the expiry of his term in June 1983 which fact is not disputed and no declaration even is necessary on this item of the relief. The plaintiff /respondent No.1 has not challenged even the appointment of respondent No.3 as Chairman of the Committee. On the contrary the prayer is to enforce the result of the election which was held on 28‑9‑1983 and which has not been annulled by any authority. This prayer was sought in pursuance of invalidation of the compromise by the Committee. Hence the prayer sought in item No.4 of the relief is not prima facie hit by the mischief of section 12 of the said Ordinance. So far as other items of the reliefs are concerned, they are only ancillary to the relief sought in l item No.4. Hence the entire suit cannot be thrown out on the ground that the one sought in item No.4 falls within the bar of section 12 of the said Ordinance. No other point has been urged to challenge the concurrent findings of the two Courts below in respect of appointment of respondent No.3 as interim receiver. I myself do not have nay reason to take exception to the views that have been adopted by two Courts below. No member of the Committee except the applicant has challenged the right of respondent No.3 to act as interim Chairman. It is also evident from the fact that respondent No.3 commands majority of the members of the Committee. Even one of the candidates whose nomination paper was rejected namely Rashid Soorty, has not taken any objection to the right of respondent No.3 to act as interim Receiver in the capacity of elected Chairman of the Committee. Other members of the Committee are respondents Nos. 4, 5 and

6. They too have not contested the claim of respondent No.3 to act as Chairman, nor have they taken any objection to the impugned orders whereby respondent No.3 was appointed as interim Receiver to run the affairs of the Association. Hence the revision application, so far it relates to appointment of respondent No.3 as interim Receiver, should be dismissed and is hereby dismissed as being without any substance. Consequently C.M.As. Nos. 390 of 1984 and 391 of 1984 regarding vacating the interim order dated 23‑4‑1984 passed by this Court also stand allowed, and C.M.A. No. 357 of 1984 stands dismissed. Now remains the two contempt applications which have been filed by the applicant Abdul Razzak Rajwani and M.A. Wajid Jawad, respondent No.3 against each other. So far as the conduct of Abdul Razzak Rajwani is concerned, there is nothing on the record to show that any injunction was issued against him restraining him from calling himself as Chairman. The injunction was issued against the respondents whereby the operation of the trial Court's order was stayed. Thus there was injunction, if' any, against respondent No.3 and not against the applicant. Hence the fact that the applicant in some letters issued by him after 25‑4‑1984 designated himself as Chairman of the Committee does not amount to contravention of the said interim order. Criminal Miscellaneous Application No.4 of 1984 is, therefore, dismissed. Now remains C.M.A. No. 845 of 1984 made by the applicant under Order XXXIX, rule 2 (3) read with Order XLI, rule 5, sections 94 and 151, C.P.C. praying that M.A. Wajid Jawad respondent No.3 may be punished for deliberated contempt of the Court inasmuch as he wilfully violated the order of this Court dated 23‑4‑1984 and continued to act as Receiver of the Association. Mr. Ali Ahmed Fazeel, learned counsel for the applicant, has referred to three letters which respondent No. 3 had written as Receiver of the Association after the stay order dated 23‑4‑1984 was served upon him. The first letter referred to by him is dated 22‑5‑1984 which respondent No.3 wrote to "All the Constituent Member Units of the Association". By this letter respondent No.3 had only informed the Units that interested members may avail of the opportunity by their participation in the proposed International Exhibition in Brunei. The second letter is dated 24‑5‑1984 addressed by respondent No.3 to the National Bank of Pakistan requesting the Bank to honour the cheques issued by him on behalf of the Association. The third letter is dated 26‑7‑1984 addressed by M.A. Wajid Jawad to All the Constituent Members of the Association" informing the members that the next meeting of the Export Promotion Committee on Exhibitions, Delegations and Display Centres will be held shortly. He further requested the members to send to the Bureau suggestion /recommendation for inclusion in the agenda of the next meeting. Except the above three letters no other allegation has been made against, respondent No.3 regarding his contravention of the stay order dated 23‑4‑1984. It may be stated that in view of the dismissal of the revision petition and upholding of the orders of the two Courts below appointing respondent No.3 as Receiver of the Association, the question of breach of stay order by the Receiver had not actually done anything to run the affairs of the Association. The two letters written by him to the Constituent Members only purport to inform the members about participation in some exhibition and calling upon them to send suggestions /recommendations to the export Promotion Bureau. These are letters of very formal nature and do not relate to administration of the affairs of the Association. The third letter addressed to the Manager, National Bank of Pakistan purports only to a request from respondent No.3 to honour the cheques issued by him on behalf of the Association. The plea of Mr. S. Ishtiaq Ali and Mr. Syed Abbas Zia learned counsel for respondents Nos. 1 and 3 respectively is that order dated 23‑4‑1984 of this Court, suspending the operation of the appellate Courts order, did not amount to removal of the Receiver, who was appointed by the trial Court and not by the first appellate Court and that in the absence of specific order regarding removal of the Receiver, respondent No.3 acted in good faith in continuing to act as Receiver by virtue of his appointment which had taken place before the passing of the stay order. The Receiver had already taken over charge of the Association immediately after the trial Court's order dated 25‑1‑1984 and that since then he had been running the affairs of the Association in the best interest of the Association with the support of all the members of the Committee except one namely the applicant. In view of, the above circumstances I do not think that there was any deliberate attempt on the apart of respondent No.3 to violate the order of this Court. However, in view of the decision of the main petition, it would be futile to consider the question of violation of an interim order which has been vacated. Consequently C.M.A. No. 845 of 1984 is also dismissed as there has been no deliberate violation of the order of this Court. One more application remains to be decided which .has been made by the intervenes Le. National Bank of Pakistan and is C.M A, No. 644 of 1984. By this application the Manager, National Bank of Pakistan states that an amount of Rs.2,953.25 is lying deposited as credit balance in favour of the Association. He seeks permission to deposit this amount with Nazis of this Court so that the account may be closed in view the stay order passed by this Court. The Bank may be informed the since the appointment of M.A. Wajid Jawad as Receiver of the Association has been upheld by this Court, hence it is not necessary to deposit the balance with this Court. The Receiver shall be entitled to operas the account of the Association with the Bank. This application is dismissed as having become infructuous the main petition and the various miscellaneous applications as well as criminal Miscellaneous Application No.4 of 1984 stand disposed of accordingly with no orders as to costs. M.Y.H. Petition dismissed