P L D 1988 Karachi 473 (PLP)

SALEEM AKHTAR, J.‑‑We propose to dispose of all these petitions by this Judgment in which common question of law is involved. All the petitioners are Educational Institutions or control, manage and run schools and claim to impart education as social service. Each of the .petitioners were individually called upon by the respondent No.l to get themselves registered under section 11 of the Employees' Old‑Age Benefits Act, 1976 (hereinafter called the Act) and pay the contribution w.e.f. July, 1976. Some petitioners had applied for exemption which was refused. All the petitioners have challenged the action of the respondent No.l on the ground that it is without jurisdiction as they are not covered by the provisions of the Act. In the counter‑affidavit it has been stated that the petitioners are commercial establishment and are covered under section 2(e) of the Act. It has also been pointed out that adequate remedies for redress are provided under the Act for adjudication of the dispute under section 33 and further that appeal .and review is provided under sections 34 and 35 of the Act. The petitioners have not availed of those remedies therefore the, petition is, not maintainable. We have heard Mr. Khalid M. Ishaque, Mr. Obaidur Rehman, Mr. A.Aziz Khan for the petitioners and Mr. Wajihuddin Ahmad Advocate‑General Sind and Mr. M.A.M.Namazi for the respondents. Mr. Khalid Ishaque the learned counsel for the petitioners has contended that taking into consideration the provisions of the Act and the services rendered by the petitioners they are not covered by the act and therefore the respondent No.l has no jurisdiction to call upon them to obtain registration and pay the contribution. There is no dispute that the petitioners are not industry. Therefore it is to be considered whether the petitioners are 'establishment'. The charging section 3 provides that all persons employed in an 'industry' or 'establishment' under a contract of service or apprenticeship, whether written or oral, express or implied, shall be insured in the manner as provided by the Act. Section 9 provides that from the first day‑ of July 1976 the employer shall pay contribution to the Institution every month in respect of every person in his insurable employment at the rate of five per cent of his wages in the prescribed manner. However, exception has been made in respect of employees whose wage exceeds Rs.1,000 per month or who have attained the age of 60 years and the age of 55 in case of women. The Act is applicable to all persons employed in an industry and establishment under a contract. In the present case we will examine the definition of the term 'establishment'. The definition of establishment was first provided by section 2(e) as follows: "Section 2(e). 'Establishment' means an organisation, whether industrial, commercial or otherwise; By Ordinance XVII of 1983 this definition was substituted .by the following definition: Section 2(e) 'Establishment' means an establishment to which the West Pakistan Shops and Establishments Ordinance, 1969 (West Pakistan Ordinance No. Viii of 1969), for the time being applies, and, notwithstanding anything contained in section 5 thereof, includes clubs, hostels, organizations and messes, not maintained for profit or gain and establishment, including hospitals, for the treatment or care of sick, infirm, destitute or mentally unfit persons." All the learned counsel agree that the amended definition as provided by Ordinance XVII of 1983 will apply to all the petitioners. In the aforestated definition all the establishments to which the West Pakistan Shops and Establishments Ordinance, 1969 (hereinafter referred as the Ordinance) applies are to be treated as establishment for purposes of the Act. Besides this a number of other concerns, organisations and establishments to which the Ordinance does not apply have been included in this definition. In the West Pakistan Shops and Establishments Ordinance. Section 2(j) of the Ordinance reads as follows:‑‑ "Section 2(j): 'Establishment' means a shop, commercial establishment, industrial establishment, private dispensary, maternity home, residential hotel, restaurant, eating house, cafe, cinema, theatre, circus, or other place of public amusement or entertainment, and such other establishments or class thereof as Government may, by notification in the official Gazette, declare to be establishments for the purposes of this Ordinance." Section 5 of the Ordinance specifies the establishments and persons to which its provisions are not applicable. The relevant provisions are reproduced as under: Section 5(vi) clubs, hostels, and messes not maintained for profit or gain; (vii) establishments for the treatment or care of the sick, infirm, destitute or mentally unfit persons; An examination of the aforestated provisions of the Act and Ordinance will reveal that besides the establishments to which the Ordinance applies certain other establishments and organisations to which the Ordinance is not applicable have been brought within the ambit of the Act. The definition in the Act is wider. The learned counsel for the petitioners has contended that word 'Organisation' as used in section 2(e) of the Act should be read to give colour of those terms which precede or follow it and therefore it will cover only those organisations which are in the nature of club, hostel or mess rendering material service of like nature. And as the service rendered by the petitioners does not fall within the nature of services contemplated by section 2(e) the petitioners cannot be treated as organization. It was further contended that the general word 'establishment' is followed by specific words therefore its meaning should be restricted to similar those words and will not apply to petitioners. In order to show the nature of service rendered by the petitioners reliance has been placed on Jamia Karachi v. Jamia Employees (1981 P L C 403) where a Bench of our Court consisting of one of us i.e. Saleem Akhtar, J. observed as follows:‑ "The importance of education can neither be ignored nor denied. Education is designed to guide a man in learning and culture, and mould him towards his eventual role in society. Education through the institutions like schools, colleges and Universities is agent of cultural transmission. Culture depends upon continuity, and these institutions help to provide it by transmitting accumulated knowledge and skills values and beliefs. Schools, Colleges and Universities help in building up character and such qualities as honesty, piety, thrift and industriousness. Besides. this they impart knowledge of art, philosophy, science, literature and last but not the least the professional expertise to meet the challenge of time and growing expansion in all fields. From the very inception of our society prime emphasis has been on learning and education. The learned people and institutions have always commanded high esteem, respect and reverence. It is a source of all knowledge and learning where people come to learn and go forth to serve. Education is the fountainhead of all inventions, sciences, technology, research, learning and knowledge. The benefit a student gets or the community at large receives from the university is completely different and distinguishable from the benefit of service which provide the community with the use of something such as hotel, electric power, transportation, mail delivery, etc. The University serves the students intellectually, morally and mentally. The service rendered by the University entirely depends upon the contribution of the learning, research, study and knowledge of the men of letters. It is this distinctive character of the University which absolutely distinguishes it from institutions providing material service. This absence of material nature of service keeps the University and the Board out of the pale of the word Industry. Education is not a service, it is a duty. Its acquirement is no longer voluntary but undisputedly it is being made compulsory. The Universality and cosmopolitan nature of education keeps it completely distinct and distinguished from material service. Education is of such universal importance that in 311 countries, the Governments have owned it as their obligation and duty towards the people. These considerations in our view are sufficient to draw a .line and save it from the sweep of generality. " The above observation was made while considering whether University of Karachi and Board of Secondary Education, Karachi are Industry as defined by the Industrial Relations Ordinance. The definition of Industry in I.R.O. is completely different from the definition of establishment in the Act. There can be no dispute with the purposes and object of the education as stated above which may be relevant to show the nature of petitioners' function and pursuits. The Act is a beneficial statute intended to provide security and benefit to the old age employees of industrial, commercial or other organizations covered by it. In this view of the matter a liberal and wide meaning should be given to the provisions of the Act to advance the remedy and not to throttle it. In Kohinoor Chemical Co. Ltd. v. Sind Employees Social Security (P L D 1977 S C 197) while considering the provisions of Social Security Ordinance, it was observed: "There is no doubt that we are dealing with a beneficial or remedial legislation conceived as a means of ameliorating the lot of the working class, and as such it would be in keeping with the accepted principle of interpretation, as observed in Divisional Superintendent, P.W.R. Karachi v. Bashir Ahmed PLD 1973 S C 589 that it should be so construed as to advance the remedy and suppress the mischief, or else it would frustrate the legislative intent. It would appear, therefore, that, in keeping with the object of the legislation, as wide an interpretation should be placed on the terms 'employee' and establishment as permissible within the language employed in the statute." In this regard Mr. Namazi has referred to P L D 1968 S C 154 and 1985 S C M R

593. According to the learned counsel for the petitioners a restricted meaning should be given to the word 'Organisation'. Considering the principle of interpretation we see no valid reason to accept this contention. In the earlier definition the term 'establishment' had been defined in a very general term as an organization commercial industrial or otherwise. But the present definition is more expressive, comprehensive, specific and definite. It includes clubs, hostels, organizations and messes, not run on profit basis. The element of earning profit has also been excluded and those clubs, hostels, messes or organizations which are not run for earning profit will also be covered by this definition. The word 'organization' was considered in Kohinoor Chemical Co. Ltd., case (supra) where Supreme Court observed: "In its literal sense an organisation connotes a systematic arrangement for a definite purpose. In the legal sense it describes a system, a body or a society furnished with organs for the normal exercise of its appropriate functions." In Adamjee Foundation and others v. First Sind Labour Court Karachi and another (P L D 1979 Kar.510) the meaning of the word 'organization' as used in the Act was stated as follows:‑ ". , . . . . .It, therefore, follows that the term 'organisation' has a very wide and literal import to deliver benefits to its employees regardless of the fact as to of whatever kind the organisation may be. In literal sense an organisation connotes systematic arrangement for a definite purpose. In the legal sense it describes a system, a body or society furnished with organs for the formal exercise of its appropriate functions.' The petitioners claim to run school, many of them as a socials service not on profit basis. Even if this claim is accepted the petitioners fall within the ambit of the word 'organisation' as used in the Act. The petitioners have a systematic arrangement with a purpose to impart education in the school which are organized, administered, managed and run by them by engaging many employees. These characteristics found in all the petitioners make them an organisation and establishment. In section 2(e) of the Act the term 'establishment' besides industrial and commercial organisations means clubs, hostels, organizations and messes run on non‑profit basis and 'establishment including hospital for treatment of sick, poor and mentally infirm persons'. Therefore while defining establishment besides using various specific and descriptive expressions the word 'establishment' has been used. The legislative intent to give a wide meaning reflects from the fact that first the general definition was changed to a wider description in which all establishments within the ambit of West Pakistan Shops and Establishments Ordinance 1969 and some of those which were excluded from its operation were included in the definition of 'establishment'. Furthermore the definition of the word 'establishment' in it besides other expressions incorporates the word 'establishment' which means that ordinary or dictionary meaning of word 'establishment' has also been incorporated in the definition which enlarges its scope. The dictionary meaning of 'establishment' is 'act of establishing, a fixed state, permanent staff, a business, a settlement.' Therefore, establishment will mean a concern, society or body of person or persons formed to run any organised activity, business, profession or pursuit for commercial, social or charitable) purpose. The learned counsel for the petitioners has relied on A.F. Ferguson & Co. v. Sind Labour Court (P L D 1985 S.C.429) but in this case the question )vas whether a firm of chartered accountants constituted an 'industry' as defined in section 2 (xiv) of the I.R.O. but no finding was given on this question and it was left open for decision by the Labour Court. Reference was also made to Holy Family Hospital v. Government of Sind (1985 S C M R 593). In this case the question for consideration was whether Hospital was covered by the word 'establishment' as defined in Workers Children Education Ordinance, 1972 and it was observed:‑ "The main contention raised on behalf of the appellants that they were not liable to pay education case because the hospitals in question were not being run for the purpose of profit or gain has no force. The education cess in terms of section 3 of the Ordinance is not levied on profits of an establishment but is required to be paid by an employer of an establishment at the rate of Rs.100 per worker per annum provided the number of such employees during a year is twenty or more. The education cess is charged for the benefit of the education of workers' children. Such object indeed is beneficial and has nothing to do whether the service rendered by the workers results in yielding any profit for the establishment or not. In accordance with the accepted principle of interpretation while dealing with a welfare and beneficial legislation, which indeed the Ordinance in question is, the term 'establishment' is to be given wide and liberal interpretation in keeping with the suprers object of the legislation so as to advance the remedy and suppress the mischief or else it would defeat the very legislative intent." The third case cited by the learned counsel is K.G.Old Principal Christian Technical Training v. Presiding Officer, Punjab Labour Court and others (P L D 1976 Lah. 1097). In this case while elucidating the definition of 'Industry' as provided in the Industrial Relations Ordinance it was observed that: "The use of the expressions Business, Trade, Manufacture, Calling Service, Employment or Occupation in the definition of Industrial Relations Ordinance is not in its ordinary dictionary meaning but in its popular and conventional meaning. In the context of Industrial and Labour Laws, these expressions apply to any enterprise which is organised and is systematic depending substantially, if not entirely, on the cooperation between labour and capital, and having as its object production, distribution and consumption of wealth, or the production or provision of material services." The dictionary meaning of the expression used for defining 'industry' was restricted taking into consideration the object and context of the Industrial and labour laws. Under the Act the element of labour, capital, distribution of wealth or the production or provision of material service cannot be a relevant factor for determining the meaning of the term establishment. It does not even take into consideration the fact that the organisation is run on philanthropic charitable or non‑profitable basis. The Act is a beneficial legislation intended to give benefit to employees during old age. As discussed above and as held in (P L D 1977 S.C.391) a wide meaning has to be given to the terms and expressions used in the Act so that maximum number of persons could receive benefits. Therefore, the term 'establishment' cannot be used only for such concerns and organisations which are engaged in business, commerce, trade and industry rendering material services. It covers even organisation, society or concern which do not render any material services or are engaged on non‑profit basis rendering charitable, social, medical, educational or any welfare service. Mr. Namazi the learned counsel for the respondents has heavily relied on P L D 1979 Kar.510 and Anjuman Faizul Islam v. Pakistan, etc. NLR 1980 Labour (Lahore)

4. In the latter case it was observed I that employees of organization of charitable or religious nature are covered by the term 'establishment'. Mr. Wajihuddin Ahmad the learned Advocate‑General has rightly contended that in view of different nature of legislation and different inquiries involved in the present cases the observations in Jamia Karachi, K. G. Old, Principal, Christian Technical Training Centre, Gujranwala, and A.F. Ferguson & Co. cases are distinguishable and not applicable. Mr. Namazi the learned counsel for the respondents has contended that some of the petitioners had applied for exemption which was not granted and as an alternate and adequate remedy is provided under the Act the petition is not maintainable. It is well‑recognised that where any action of any Government functionary is without jurisdiction, violates fundamental rights, has infringed principles of natural justice or any provision of Constitution or they statute under which action has been taken is void, the same can bed challenged without availing the alternate remedy provided under the statute. As discussed earlier the petitioners are covered by the Act; and are. an 'establishment' within the meaning of the section 2(e) of the Act, therefore, the petitions are dismissed with no order as to costs. M.B.A./5‑209/K Petitions dismissed.