1982 PLP 850 (PLC(CS))

Chamber of Commerce and Industry, Karachi v. Presiding Officer, Sind Labour Court No. 111, Karachi and another 1979 P L C 179 rel. M. L. Shahani for Appellant. Tariq Ali for Respondent. Date of hearing: 17th February, 1982. The service of the appellant, who was employed as a Clerk under the control of the Engineer‑in‑Chief of the respondent‑Company, were terminated, vide office order, dated 28th May, 1980. The said order was based on the domestic enquiry proceedings held against the appellant in which it is stated that an act of serious misconduct on the part of the appellant was established against him. The appellant challenged the order of termination of his services before the learned 1l[rd Labour Court which dismissed his grievance petition on account of the absence of the appellant, who was to appear for cross‑examination, vide its order, dated 5th November, 1980. On appeal, this Tribunal, by its order, given on 26th January, 1981, set aside the orders of the learned Labour Court and remanded the case to it for decision on merits a this Tribunal was of the view that there was nothing to contradict the application submitted by the learned counsel of the appellant before the learned Labour Court that the appellant was ill and hence the prayer of the learned counsel for a short adjournment should not have been rejected. On remand, the appellant was cross‑examined by the learned counsel for the respondent‑Company but it appears that no evidence was recorded on behalf of the respondent company as its side was closed on account of the fact that despite sufficient opportunities being given to it, it failed to adduce any evidence. The learned Labour Court, by its fresh decision given on 11th March, 1981, 'has again dismissed the grie vance petition of the appellant on the ground that the same is not main tainable as the Standing Orders are not applicable to the respondent company. In coming to this decision, the learned Labour Court has relied upon the decision of a Division Bench of the Karachi High Court in the case of Sind Industrial Trading Estate v. Board of Revenue and 3 others (P L D 1975 Kar. 128). Aggrieved by this decision, the appellant has come up in appeal to this Tribunal.

2. I have heard Mr. M. L. Shahant learned counsel for the appel lant, and Mr. Tariq Ali, who represented the respondent company. Mr. Shahani assailed the impugned decision of the learned Labour Court on 2 grounds‑ (a) that the learned Labour Court has misconcei ved the legal position in holding that the Standing Orders are not applicable to employees in the ‑respondent‑Company and (b) that there was not tangible evidence either before the enquiry officer or the learned Labour Court to establish misconduct punishable under Standing Order 15 against the appellant.

3. It was' submitted by Mr. Shahani that the respondent was a Joint Stock Company, which was‑.running and managing the Sind Indus trial Trading Estate, and, therefore, it should be deemed to be a com mercial establishment for the purposes of the Standing Orders. He further submitted that even if the respondent‑Company somehow could be presumed to be a department of Government or to be run by or under the authority of the provincial Government, it has admittedly no Statutory Rules of service and, hence, it does not qualify for exemption from the operation of the Standing Orders under the first proviso to subsection (4) of section 1 of the Sind Industrial and Commercial Employment (Standing Orders) Ordinance, 1968. The learned counsel further submitted that the mere fact that the respondent company was not', set up for the purposes of making profits or even the fact that the profits; if any, made by the company, are not to be distributed among its members and shareholders would not exclude the company from the operation of the Standing Orders, if there was evidence to indicate, as in the present case, that the company is running on commercial lines or for commercial purposes. In support of his contention, he relied upon the decision of a learned Single Judge of the Karachi High Court in the case of Chamber of Commerce and Industry, Karachi v. Presiding Officer, Sind Labour Court No. III, Karachi and another (1979 P L C 179). On the other hand, Mr. Tariq Ali placed reliance on the decision in the case of Sind Industrial Trading Estate, Karachi.

4. The decision in the case of S. I. T. E., turned on the provision of the Constitution exempting the Government of a Province from liabi lity to Federal taxation in respect of income accruing, arising or received is Pakistan. It was held by the Division Bench in that case that the S. I. T. E. Ltd., being nothing more than a department of the Provincial Government, though clothed with juristic personality, performs the essential functions entrusted to the Province with regard to the develop ment of trade and industries, and hence, the income of this body corpo rate is the income of the Provincial Government, and was not liable .to taxation under the Income‑tax Act, .1922. In the instant case however, the issue is totally different. Even if it were to be conceded that the' S.

1. T. E. was being run under the authority of the Provincial Government, the second essential requirement, in order to entitle it to exemption from the operation of the Standing Orders under the first proviso to subsection (4) of section 1 of the Sind Industrial and Commercial Employ ment (Standing Orders) Ordinance, 1968, is that it should have Statutory Rules of Services, Conduct or Discipline applicable to its employees. No such Statutory Rules were either produced or are stated to be applicable to the employees of the respondent‑Company, who are admit tedly not Government servants and are not governed by the provisions of the Sind Government Servants Act, 1973. Mr. Tariq Ali was, there fore, at some pains to show that the respondent company was neither a commercial establishment nor an Industrial establishment for the purpose of the Standing Orders. The Memorandum and Article of Association of the respondent company, which were produced before the learned Labour Court, indicate that the respondent company was established under the Sind Government Resolution No. 24‑1, B/47‑1, dated 2nd tune, 1947. According to the said Resolution, the following are to be the functions of the company:‑ "(ii) The functions of this Company will be to acquire land for these trading estates, to lay out and develop such land by construction of roads and drainage and the provision of light and where either at the request of a particular trader or otherwise it appears to be advantageous to do so, to construct and rent promises to traders. The company will make such charges for water and electricity supplied and for the rent of land and premises as to enable it to pay its expenses and interest at the rate not higher than 4 percent on its capital outlay.

5. The Government Resolution further provides that the company would not issue shares to the public, but if the shares are required by law, they would be of the minimum amount possible and all held by Government, unless under law, each Director must hold are a certain minimum amount of shares. The company is prohibited from making any profit or declaring any dividend on its shares, and, unless provided otherwise by law, the company is to be financed solely by Government though pro vision might be made for the issue, later, of debentures. In the case of winding up, any property of the respondent company remaining after satisfaction of all its debts and liabilities, the same shall not be paid to or distributed among the members of the company, but shall be paid or transferred to the provincial Government or to its nominee. It is also provided in the Memorandum of respondent company that in the event of the company being wound up, every member of the company will con tribute to the assets of the company for payment of its debts and liabili ties up to an amount not exceeding rupees ten. These provisions, according to Mr. Tariq Ali, do not bring the respondent company within the definition of Joint Stock Company as given in section 254 of the Companies Act, as the company has neither any capital nor any share. It is, however, unnecessary to go into the question whether the respon dent company is or is not a commercial establishment for the pur poses of the Standing Orders, as even on the assumption that the Stan ding Orders are applicable to the respondent company, I am of the view that the appellant has no case and his appeal is liable to be dismissed. It is not disputed that a charge‑sheet, dated 2nd February, 1980, was served on the appellant. It is true that the charge‑sheet, does not give details of the actual misconduct committed by the appellant, but looking to the fact that the misconduct alleged against the appellant was of un dressing and committing an extremely obscene act, the omission to give details in the charge‑sheet would be immaterial, particularly when in the domestic enquiry full details of the indecent act committed by the appel lant were given to the domestic enquiry as many as 5 witnesses were exami ned. Both complainant Aftab Ahmad Mangi and Mustafa Ali, a Typist in the respondent company, supported the allegations against the appel lant and gave details of the obscene act committed by him. Witness Mustafa All was not cross‑examined by the appellant and hence his evidence stands unrebutted. His evidence was sought to be assailed by Mr. M. L. Shahani, the learned counsel for the appellant, on the ground that whereas complainant Aftab Ahmad Mangi has stated in his complaint that it was witness Muhammad Ali Qazi who was inviting person to witness the obscene act of the appellant in his statement before the enquiry officer, witness Mustafa Ali has stated that it was the appellant himself who was inviting the bye-standers to wit ness the obscene act. The criticism levelled against the testimony of this witness by Mr. Shahani is not well founded as the witness also alleged that Muhammad Ali Qazi too was asking the bye‑standers to witness the obscene act. As regards Aftab Ahmad Mangi, who was the person who had brought the matter to the notice of the authorities by his written report which appears to have been made on the very day that the incident had occurred, Mr. Shahani attempted to argue that no reliance should be placed on his evidence before the Enquiry Officer as in his application, dated 22nd January, 1980, the said complainant has stated that he had made the report against the appellant on account of undue pressure of Superintendent Shaukat Ali Ansari, and that the truth is that it was all a joke and that there was no substance in the matter. The complainant was not confronted by the appellant in his evidence before the Enquiry Officer, with this subsequent application. However, it appears that the "Enquiry officer, subsequently had examined the complainant in the presence of the appellant in regard to the said sub sequent application. The complainant stated before Enquiry Officer that the appellant had obtained the application, dated 20th January, 1980, from him by misrepresenting to him that the Engineer‑in‑Chief has ordered that he should give such an application to save the appellant from dis ciplinary action. Complainant Aftab Ahmed further stated that on realising that a trick had been played upon him by the appellant, sub mitted another application, dated 23rd January, 1980, that is the day following the one on which he had made the application, dated 20th January, 1980, explaining the circumstances in which the earlier applica tion had been made by him. The third witness examined in the do mestic enquiry, namely Muhammad Ali Qazi, has not supported the allegations against the appellant. This was to be expected as he appears to have been at least partly responsible for the obscenity, committed by the appellant and apparently the act was committed on his instigation. The remaining 2 witnesses, Nazir and Imam Bux, have stated that they were told of the incident immediately after it had occurred. It is true that they are not actual eye‑witnesses to the incident but their evidence lends support to the testimony of the complainant Aftab Ahmad, who had narrated the incident to them immediately after it had occurred. The Enquiry Officer further came to the conclusion that this was a serious act of misconduct committed by the appellant. The services of the appellant, therefore, were rightly terminated by the Engineer‑in‑Chief who was the competent authority to do so. This order was passed by him after a second show‑cause notice was issued to the appellant and his reply thereto was considered and found unsatisfactory. All the require ments of Standing Order 15 have thus been fulfilled in tire instant case. As such, even if the Standing Orders are considered to be applicable to the respondent company, there would appear to be no valid ground for interference with the action taken against the appellant. In fact, the appellant appears to have been lightly looking to the grave act of mis conduct committed by him in an office in the presence of several employees.

6. For the reasons discussed by me above, I find no merit in this appeal and wound dismiss the same. Appeal dismissed.