P L D 1967 Karachi 171 (PLP)

QADEERUDDIN AHMED, J.‑‑This petition is directed against two orders of the Returning Officer, Shikarpur, dated the 13th of February, 1956. by which he rejected the objections which were raised to the nomination of respondents Nos. 2 and 3 for election to the Shikarpur Municipal Committee. The main objection was that they are Directors of the electricity company which has a contract with Municipal Committee for supplying electricity to it. A copy of the contract appears at page 9 of this record. It shows that there is a company known as Shikarpur Electric Supply Co. Ltd., which has undertaken to supply electricity to the Municipal Committee. The contract was made on the Ist of March, 1951 and was to subsist for five years from that date, but it is not denied that the company is still supplying electricity to the Municipal Committee. When respondents Nos. 2 and 3 were nominated, objections were raised by the petitioner to their nomination on the ground that they had a pecuniary interest in the Municipal Committee which disqualified them for becoming its members.

2. Counsel for the petitioner has explained that the above disqualification was the result of the introduction of the following provision by section 10 of the Municipal Administration (West Pakistan Amendment) Act, 1965. 1n Municipal Administration Ordinance, 1960:‑ A person shall be disqualified from being elected as a member of a Municipal Committee to represent special interests, if he‑‑ (a) .. (b) is a party to a contract for work to be done for or goods to be supplied to the Municipal Committee or has otherwise any pecuniary interest in such Municipal Committee. The disqualification from which respondents Nos. 2 and 3 suffer, according to counsel, is that they are the Managing Directors of the company which has the contract for supplying electricity. At the time of the first hearing of this petition we were given to understand that the Shikarpur. Electric Supply Co. Ltd. was a private limited company and that it was originally constituted of two shareholders who were brothers. One of the shareholders, according to counsel held shares of the value of nine annas in a rupee and the other of the value of seven annas in a rupee. The brother who held shares of the value of seven annas in a rupee, according to counsel, had migrated to India and that the other brother having died, his two sons were holding the entire value of nine annas in a rupee in the company. When today counsel opened his arguments, he informed us that he was mistaken because according to his instructions the Shikarpur Electric Supply Co. Ltd. is not a private limited company but a statutory body. We called upon Mr. Samad Khan to explain to us as to what the true situation was. He produced a copy of the Memorandum and Articles of Association of the company which shows that it is neither .a statutory corporation nor a private limited company but that it is a public limited company which has been formed under the Companies Act, 1913. We have, therefore, made inquiries from respondent No. 2 who is present in Court. He has explained that this is a public limited company and that from the beginning it had about 400 shareholders.‑ He informed us that it is managed by a firm of "Managing Agents." Originally the Managing Agents, according to him, were a certain Punjabi Co. which was a firm. Now the firm called Messrs Chunilal Motilal & Co. occupies that position. This firm, according to hits, originally consisted of two partners: Chunilal and Motilal. Chunilal is said to have died in 1937 and his wife Shrimati Vovan Bai to have become the Managing partner of the firm in his place. Subsequently, Motilal died and his wife became a partner in the place of her husband. Respondent No. 2 is a son of Chunilal but not a partner, according to him, of the Managing Agents. The two ladies, who constituted the firm, according to respondent No. 2, hold shares in the public limited company to the value of seven annas in a rupee: Some of the shares held by them are said to be in the name of respondent No. 2 also. The nominal value of the shares which are in his name is said be Rs. 10,

000. The position of respondent No. 2. in the public limited company is further said to be that he has been nominated by the firm of the Managing Agents to be the Managing Director of the Company. Although he has been appointed by the Managing Agents, is paid by the public limited company. His salary, according to himself is Rs. 800 per month. 3: The above facts have not been disputed before us and there is nothing on this record to show that they are in any respect wrong excepting for a confusion that is noticeable in the use of the expressions "Managing Directors" and "Managing Agents" when ‑a reference is made to Article 96 of the Articles of Association of the Company. The position of the respondents in a nutshell is that respondent No. 2 is the "Managing Director" of the Shikarpur Electric Supply Co. Ltd. He has been appointed by the firm of the "Managing Agents" but is paid by the Company itself. Respondent No. 3 has no status in the firm of the Managing Agents or in the Company. He is said to be an employee of the Company as the Power‑House Superintendent only.

4. Counsel for the petitioner argued this case on the assumption that the facts were as explained above. He attacked the orders which are in question by referring to English cases and by referring to the provisions which are contained in section 116 of the Representation of the People Act (XXXI) of 1957. That section is as follows:‑ Government contractors etc.‑(1) Subject to the other provisions of this section, a person shall be disqualified for being elected or being a member of the National Assemebly or a Provincial Assembly if, whether by himself or by any person or body or persons in trust for him or for his benefit or on his account, he has any share or interest in a contract for the supply of goods to, or for the execution of any works or the performance of any services undertaken by the Government. (2) A disqualification under subsection (1) shall not, where the share or interest in the contract devolves on a person by inheritance or succession or as a legatee, executor or administrator, take effect until the expiration of six months after it has so devolved on him or of such longer period as the Election Commission may in any particular case allow. (3) A person shall not be disqualified under subsection (1) by reason of his having a share or interest in a contract entered into between the Government and a public company, as defined in section 2 of the Companies Act, 1913 (VII of 1913), of which he is a shareholder but is neither a director holding as office of profit under the company nor a managing agent. (4) Nothing in subsection (i) shall extend to a contract entered into between a co‑operative Society and the Govern ment. (5) For the avoidance of doubt it is hereby declared that where any such contract as is referred to in subsection (1) has been entered into by or on behalf of a Hindu undivided family shall become subject to the disqualification mentioned therein, but where the contract has been entered into by a member of a Hindu undivided family carrying on a separate business in course of such business, any other member of the said family having no share or interest in that business shall not become subject to such disqualification." Counsel has argued that though the present case is governed by the provisions contained in section 16 of the Municipal Administration (West Pakistan Amendment) Act, 1965, yet by analogy the disqualification should be considered to be the same as is imposed by subsection 3 of section 116 of the Representation of the People Act, 1957. This argument is not sound because the two statutes are vastly different and by analogy the disqualification arising from one cannot be regarded to be the disqualification which arises from the other. Similarly the English Judgments to which reference have been made are not helpful because they have proceeded on the language of the relevant provisions which were different from the provisions which are under consideration now.

5. Counsel has further argued that respondents Nos. 2 and 3 have a pecuniary interest in the contract which has been made by the company inasmuch as (i) they are interested in the Managing Agents who are incharge of the administration of the company and (ii) one of them is a shareholder in the company itself. We find however, that the language of section 16 of the Municipal Administration Ordinance, 1960 as amended by Municipal Administration (West Pakistan Amendment) Act, 1965, on which counsel has retied, restricts the disqualification to a person being as party to the contract with the Municipal Committee or to a person having pecuniary interest in the Municipal Committee. The first part of that provision is not relevant to this case. Its second part was therefore pressed by counsel by saying that respondent No. 2 has a pecuniary interest in the Shikarpur Municipal Committee itself in terms of the section. We tried to ascertain from counsel as to hour in the above circumstances respondent No. 2 could be said to have any pecuniary interest in the municipality his only reply was that he was paid a salary of Rs. 800 by the company itself. This interest which he has in getting the salary from the company, as ad appointee of the Managing Agents, does not create his interest in the Municipal Committee. We may recall here that the Shikarpur Electric Supply Co. Ltd., has a contract with the Shikarpur Municipal Committee but that contract has not been made with respondents Nos. 2 and

3. It has not even been made with the firm of the Managing Agents excepting for their status of being agents of the Company. The connection of respondents Nos. 2 and 3 therefore, is not only indirect but it ceases to be recognisable when it is found that they are not the beneficiaries of the contract. They cannot be said to have pecuniary interest in the Municipal Committee.

6. In the above circumstances, we do not think that the orders of the Returning Officer rejecting the objections raised on behalf of the petitioner were wrongly made. The petition is, therefore, dismissed with costs. K. B. A. Petition dismissed.