1993 PLP (C (PLC(CS))

...... This argument in effect, assumes that because the Cooperative Bank concerned in the present case had by its own bye‑laws adopted the procedure of the Government Service Rules for the taking of disciplinary action against its employees, such employees were also entitled to the protection given to Government servants under section 240(3) of the Government of India Act, 1935. This assumption, however, is totally unwarranted, for. the Civil Service Rules were made applicable to the case of the appellant not by virtue of any statutory provision but purely by the adoption thereof under the bye laws of the Cooperative Bank, which were no more than the rules laid down for the guidance of the Bank itself. These' rules, therefore, did not create any right in the appellant to hold his office in accordance with them, nor did the said rules automatically extend the protection given to a Government servant under the Constitutional provisions of the Government of India Act, 19.35, and the late Constitution, to persons employed in non‑Governmental institutions or concerns. Even if the adoption of the Government Service Rules could be interpreted as amounting to the adoption of also the quarantees of the kind given to public servants by the aforesaid Constitutional provisions, they would have no statutory force. behind them and would, therefore, according to the decision of the Judicial Committee in the ease of Venkata Rao v. The Secretary of State for India‑in‑Council (64 IA 55) be no more than mere violations of rules or regulations which would not entitle the appellant to have the performance of the rules enforced by action. The High Court of West Pakistan was, therefore, in our view, right in refusing to interfere in its writ jurisdiction with the decision of the appellate order of the Principal, Cooperative Training Institute, acting as Registrar, Cooperative Societies, West Pakistan, upholding the dismissal of the appellant." In The Lahore Central Cooperative Bank Ltd. v. Pir Saif Ullah Shah (PLD 1959 SC (Pak.) 210, it was held that the employees of Cooperative Bank cannot claim protection of their service under Civil Services Rules because those are only applicable to the public servants and not the employees of Cooperative Bank. It was further observed that the employees of private corporations or Banks couldn t resort to writ jurisdiction for the redress of their grievance in the matter relating to their service. In Muhammad Sharif v. The Secretary to the Government of the Punjab, Basic Democracies, Social Welfare and Local Government Department, Lahore PLD 1973 SC 497, it was observed that as regulations of Governing Council of a College do not have the status of statutory rules, the writ jurisdiction could not be invoked for the redress of their grievance in the matter of service under Article 98 of the Constitution of Pakistan, 1962. In R.T.H. Janjua v. National Shipping Corporation PLD 1974 SC 146, it was observed that Constitutional safeguard available to a civil servant against the order of dismissal or removal from the service is not available to the servants of the company or statutory corporation because such employees are governed by the principle of master and servant. They can seek the redress of their grievance by claiming damages for the wrongful dismissal or any other wrongful act affecting their services. In Zainul Abidin v. Multan Central Cooperative Bank Limited, Multan PLD 1966 SC 445, it was observed that Constitutional remedy under Articles 98 and 177 of the Constitution of Pakistan, 1962 could only be availed by a person holding public office and wrongful dismissal of an employee of Cooperative Bank could not seek redress of his grievance by invoking the writ jurisdiction. It was further opined that although the Bank has made the Public Service Rules applicable to their employees but as the application of the said Rules is not in pursuance of a statutory provision, their adoption under Bye laws of Cooperative Bank is no more than the rules laid down for the guidance of the Bank. These rules did not create any right in favour of employees of the Bank to seek redress in the matter of their service by resorting to writ jurisdiction. In the Chairman, East Pakistan Industrial Development Corporation, Dacca v. Rustom Ali PLD 1966 SC 848, it was observed that employees of Cooperative Bank are governed by the rule of Master and Servant and, thus, they were not entitled to seek redress of their grievance by resorting to writ jurisdiction under Article 98 of the Constitution of Pakistan, 1962. In Fawwad &. Fareen Enterprises Ltd, v. Director of Industries. Government of Sindh, Karachi PLD 1983 SC 268, it was held that as the rules contained in Sindh Purchase Manual, 1977 do not have force of law or statutory rules, violation thereof did not furnish any cause of action to seek redress by resorting to writ jurisdiction. In Anwar Hussain v. Agricultural Development Bank of Pakistan (PLD 1984 SC 194), it was observed that as the relationship of the employees of the statutory corporation is governed by the contract entered into between the parties, the principle of Master and Servant is applicable and they are not entitled to any relief by resorting to writ jurisdiction. It was further opined that the doctrine is based on the principle that a civil servant for whom there are Constitutional safeguards is not‑governed by the principle of master and servant because he is possessed of a legal character for enforcement of which he can bring an action but it is not in case of employees of the statutory corporation. However, if the employees of a statutory corporation have been provided protection of their service through statutory rules, the general law of master and servant will not apply. In such a case the employer would be bound to follow the procedure provided for in the statute or the statutory rules. In Ghulam Hafeez v. Government of Sindh (1991 PLC (C.S.) 530), it was held that rules under which the petitioner was governed in the matter of his service cannot be equated with the statutory rules, as the rues were framed/adopted by the Governing Body of the Institution under the powers vested in it under section 80 of the Provincial Employees' Social Security Ordinance, 1965. The writ filed by the petitioner was not maintained. In Lt.‑Col. Shujauddin Ahmad v. Oil & Gas Development Corporation‑(1971 SCMR 566), it was held that the employees of statutory corporation did not acquire the status of Government servants nor guarantees given by the Constitution were applicable to them. Their case will be governed by the law of master axed servant because a contract of service cannot be specifically enforced. Consequently, the petition for leave to appeal against the judgment of the High Court was refused. The above survey of the case‑law shows that later view of the Supreme Court of Pakistan is that if terms and conditions of the service of employees of a statutory body are regulated by statutory rules, the doctrine of `master and servant' will have no application and in such a case an aggrieved employee of a statutory body can seek redress of his grievance by invoking writ jurisdiction. The aforesaid view has been affirmed by the Supreme Court of Pakistan in cases relied upon by the learned counsel for the respondents, referred to above and reported as Muhammad Sharif v. The Secretary to the Government bf Punjab, Basic Democracies, Social. Welfare and Local Government Department, Lahore PLD 1973 SC 49 7, Fawwad & Fareen Enterprises Ltd. v, Director of Industries, Government of Sindh, Karachi PLD 1983 SC 268 and Anwar Hussain v. Agricultural Development Bank of Pakistan PLD 1984 SC

194. The principle has been further approved by the Supreme Court of Pakistan in the following cases:‑‑ In Raziuddin v. Chairman, Pakistan International Airlines PLD 1992 SC 531, it has been observed as under:‑‑ "

6. The legal position obtaining in Pakistan as‑to the status of employees of the Corporations seems to be that the relationship between a Corporation and its employees is that of Master and Servant and that in case of wrongful dismissal of an employee of the Corporation, the remedy, is to claim damages and not the remedy of reinstatement. However, this rule is subject to a qualification, namely, .if the relationship between a Corporation and its employees is regulated by statutory provisions and if there is any breach of such provisions, an employee of such a Corporation may maintain an action for reinstatement:' In Karachi Development Authority v. Wali Ahmad Khan 1991 SCMR 2434, it was observed as under:‑‑ "The review of the cases discussed above shows that the general rule is that the service of a person with a statutory Corporation is essentially based on contractual relationship and is therefore governed by the law of master and servant, which implies that the remedy for illegal termination of service resulting into the breach of contract of service, is to file a suit for damages but no suit for declaration is maintainable, for the simple reason that a service contract is not specifically enforcible which will result in compelling an unwilling master to accept a person in his service: against his will. The position so far as the Constitutional remedy tinder Article 199 of the Constitution is identical. However, to cases where the post held by the employee of a statutory Corporation is a public office, as defined hereinabove, then relief in the nature of quo warranto to remove a, person who is unlawfully holding the post can be granted in Constitutional jurisdiction. The other exception to the aforesaid general rule is that if the freedom of contract is placed under statutory fetters, by reserving controlling power with the Government in the matter of framing of rules or regulations touching the terms and conditions of service of the employees of such a statutory body, in such a case the pleasure of the master is taken over by the statutory provisions and the, case would stand outside the toaster and servant rule, so that Constitutional jurisdiction would be amenable to any violation of the statutory rules or regulations." In Sindh Road Transport Corporation v. Muhammad Ali G. Khokhar 1990 SCMR 1404, it was held that there were no statutory rules in the field to govern matters relating to employment in the Road Transport Corporation, therefore, the High Court could not issue a writ. In The Principal, Cadet College, Kohat v. Muhammad Shoab Qureshi (PLD 1984 SC 170), it was held as under:‑‑ "It is, therefore, evident that where the conditions of service of an employee of a statutory body are governed by statutory rules, any action prejudicial taken against him in derogation or in violation of the said rules can be set aside by a writ petition. However, where his terms and conditions are not governed by statutory rules but only by regulations, instructions or directions, which the institution or body, in which he is employed, has issued for its internal use, any violation thereof will not, normally, be enforced through a writ petition." The point which falls for determination is as to whether in the instant case the rules governing the matter relating to the service of the parties are statutory rules or the same would be only deemed to be instructions for the guidance of the Bank administration. The Rules of 1984 are purported to have been made by the Board of Directors under Bye‑Law No.

17. It is desirable to reproduce the same below:‑‑ "The Board may appoint from among its own members a small Working Committee, and may delegate to that Committee or to any employee of the Bank, acting singly or jointly, such of its own powers as it may consider necessary to delegate for the better conduct of the bank business." It is evident that Bye‑Law No. 17 of the Bye‑laws made by the Board of Directors does not deal with the appointment of the officers of the Bank and, thus, it is not correct to suggest that the Rules of 1984 were framed under Regulation No. 17 of the Bye‑laws. It may be stated that the Cooperative Societies Act, 1925 was adopted in Azad Kashmir by an Act known as the Cooperative Societies (Application to Azad Jammu and Kashmir) Act, 1967. Under section 5 of the Act, the rules made under the Cooperative Societies Act, 1925 (Act VII of 1925) as they were in force in the West Pakistan, were also made applicable to the Azad Jammu and Kashmir territory until altered, amended or repealed under the aforesaid Act. At the time of adoption of Cooperative Societies Act, 1925 in Azad Kashmir, the Cooperative Societies Rules, 1927 were in force in Pakistan which were framed by the Government under section 71 of the Cooperative Societies Act, 1925. Under Rule 55(1) of the said Rules, the Committee of every Cooperative Bank having a working capital of over Rupees one lac, have to frame Rules for regulating the appointment, removal, dismissal and promotion of its employees. In other words, the power of framing rules regarding terms and conditions of service of employees of a Cooperative Society or a Bank was delegated to the Committee or the Board by virtue of Rule 55 of the Cooperative Societies Rules, 1927. Thus, at the time of framing Rules, 1984, the aforesaid Rules of 1927 were in force in Azad Kashmir by virtue of section 5 of Cooperative Societies (Application to Azad Jammu and Kashmir) Act, 1967. It follows from what has been stated above that the aforesaid Rules of 1927 were substituted by the Board as a delegated of the powers under Rule 55 of Cooperative Societies Rules, 1927 read with subsection (3) of section 71 of the Cooperative Societies Act, 1925. Thus in view of the aforesaid facts, the Rules of 1984 purported to have been framed under Bye‑law No. 17 would be deemed to have been framed under Rule 55 of the Cooperative Societies Rules, 1927 read with section 71(3) of the Cooperative Societies Act, 1925 because mere wrong reference to law, rule or statute would not adversely affect the validity of the rules or the powers of the rule‑making body; if such body otherwise had the jurisdiction to frame the rules. The next question which calls for resolution is as to whether Rules of 1984, in view of the circumstances listed above, are statutory rules or not. We are of the view that this question does not pose any difficulty because section 71 of the Cooperative Societies Act stipulates the framing of such rules by the Government or by its delegated. According to the definition of word `Committee', `Board' is included in it. Therefore, the aforesaid Rules of 1984 having been framed in pursuance of powers which vested in the Government and were delegated to the Board would be deemed to be the statutory rules and not the rules only for the guidance of the Administration of the Bank Authorities. The view taken in case reported as The Principal, Cadet College, Kohat v. Muhammad Shoab Qureshi PLD 1984 SC 170 and followed in Ghulam Hafeez v. Government of Sindh 1991 PLC (C.S.) 530, that if the relevant statute gives powers to the statutory body to frame rules regarding terms and conditions, the Government would have no control over same and the writ petition would not be competent. In the instant case, as has been already stated, the Government enjoys power to frame rules relating to the terms and conditions of the employees of the Bank under section 71 of the Cooperative Societies Act, 1925; however, it has delegated the powers of framing the rules to the Board. Thus, the Government is not divested of the powers to frame rules or amend the same merely by the factum of delegation of powers. The Government can amend or substitute rules even after delegating the powers whenever it so chooses. Therefore, it cannot be said that in the instant case the rules cannot be regarded to be the `statutory rules' because the Government has no control over the matter in view of the relevant statutory provisions. Even otherwise, we are doubtful that the mere fact that statute gives powers to the management of the statutory body to frame rules instead of Government, the rules would not be statutory rules. However, this question does not need to be resolved in the present case, as the matter can be otherwise disposed of. The next point which has been urged by the counsel for toe respondent is that as alternate remedy was available to the appellants, herein, the writ was even otherwise incompetent. Sub‑rules (1) and (2) of Rule 22 of the Rules of 1984 are reproduced below for elucidating the matter: (1) An employee shall have the right of making an application for review, as provided hereunder; against any of the penalties imposed under subsections (iii) and (iv) of the rule. (2) An appeal or an application for review, as the case may be, shall lie‑‑ (a) in the case of employees except in category IV and V to the Board which may refer the same to a Standing Committee of at least 3 members of the Board. The Committee shall consider the application and submit its recommendations to the Board for such final orders as the latter may deem fit to make; (b) in the case of employees in category IV and V to an authority next higher to that which has passed the orders in question; provided that in every case where the employee concerned so desires, he will have a right to be heard in person before authority competent to hear the review or the appeal, as the case may be. (3) It is evident that under sub‑rule (1), an employee of the Bank has a right to file a review against any of the penalties imposed under subsections (iii) and (iv) of the rule and the expression of the rule implies Rule 22 but there are no subsections (iii) and (iv) of Rules

22. Punishments which could be awarded under the Rules have been enumerated under Rule 21 (section 11); and subsection (ii) of Rule 21 pertains to the punishment of dismissal from service and subsection (iii) to allowances to which an employee of the Bank is entitled in case of suspension. It does not deal with the question of appointment or promotion. Thus, even if it is assumed for the sake of c, arguments that subsections (iii) and (iv) appearing in Rule 22(1) refer to Rule 21(11) even then it cannot be said that the matter could be assailed by the appellants under the Rules by way of an appeal or review and, thus, they had an adequate remedy other than the writ. Thus, the argument that an alternate remedy was available in the instant case is without any substance and is hereby repelled. The next question which needs determination is as to whether respondents Nos. 2 and 3 were competent to promote or appoint respondent No. 4 as Deputy General Manager. Under Rule 7 of the Rules, appointment as an officer of the Bank could be made by initial recruitment or by promotion. Under Rule 8 the General Manager can ‑pass any order of appointment in respect of employees other than Categories I, II and III; appointments of officers falling in Categories I, II and III could be made by the Board; the respondent No. 4 falls in Category I and only the Board was competent to pass the order regarding his promotion etc. The Registrar, Cooperative Societies, had no power whatsoever under the Rules to pass the impugned order. Besides, under Rule 19, the promotions of Bank employees were ordinarily to be made on the basis of seniority‑cum‑merit but in the instant case merits of the appellants for promotion were not considered at any stage. The record placed in the writ petition shows that the appellants were senior to respondent No. 4 according to the seniority list. Thus, the impugned order cannot be regarded to be in conformity with the Rules. Therefore, the finding of the High Court that the impugned order was violative of the Rules is not open to an exception. We may point out that the learned Judge in the High Court also reached the conclusion that the promotion of respondent No. 4 was illegal on the grounds which have found favour with us but respondent No. 4 did not rile an appeal before this Court. Since we have set aside the operative part of the order by which the High Court dismissed the writ petition, it was not necessary for us to examine the validity of the promotion order of respondent No. 4 because there was no appeal against it. It was contended that the Registrar of the Cooperative Societies issued the impugned order subject to the approval of the Board of Directors and, thus, the writ was not maintainable. This argument has no force because the relevant rules did not authorise the Registrar of Cooperative Societies to pass an order of promotion to a post of BPS‑18 subject to approval of Board of Directors and the order, therefore, is without jurisdiction. We note that the impugned order was passed on 28th February, 1991 and more than two years have passed which, prima facie creates the impression that reference to the Board of Directors was merely a device to camouflage and to protect an order passed without jurisdiction. It was also held by the High Court that the employees of the Bank, including the appellants, were inducted in the service of the Bank on the basis of agreement, therefore, no writ was competent. Copies of the appointment orders of the appellants form a part of the record of the High Court and para. No. 4 of both the orders is in the following terms:‑‑ "4.He will be governed by the rules and regulations of the Bank as framed from time to time." This provision clearly shows that the appellants were not serving the Bank on the basis of an agreement but were governed by rules and regulations of the Bank as has been found by us in the earlier part of this judgment. There is another aspect of the matter. In their written statement, the respondents, including Registrar, have taken the stand that the appellants were governed by the rules known as Azad Jammu and Kashmir Civil Servants (Appointment and Conditions of Service) Rules, 1977 and, as such, they could file an appeal to the Service Tribunal and could not invoke writ jurisdiction. This contention on the very face of it was devoid of any force; so much so that it does not find any reference in the written arguments filed on behalf of the respondents. The Registrar, in the instant case, could only perform functions according to the Service Rules of 1984, referred to above. It may be pointed out that the said Rules were framed by a Committee which was headed by the Additional Chief Secretary as Chairman and the Registrar, Cooperative Societies, was one of the members of the Committee. The said Rules were duly signed by the Registrar of the time on 1‑8‑1986. Thus, it can be safely in friend that any reference to the Service Rules of 1984 in the written statement was avoided intentionally because the respondents were conscious of the fact that the impugned order was violative of the said Rules; however, in the written arguments they were obliged to rely upon Service Rules of 1984. Even if Service Rules of 1984 had not been framed, this was a fit case in which the impugned order of the Registrar could be held as without jurisdiction under section 44 of the Interim Constitution Act, 1974. The Registrar is appointed by the Government under section 4 of the Cooperative Societies Act, 1925 and the Government by general and special order can confer any of the powers on the Registrar under the said Act. It is obvious that while performing the duties, the Registrar is legally competent to perform only those functions, which have been specifically entrusted to him by the Government. The High Court under section 44(2)(a)(ii) of the Azad Jammu and Kashmir Interim Constitution Act, 1974, on the application of an aggrieved person, can declare any act done by a person acting in connection with the affairs of the State or a local authority as being without lawful authority and of no legal effect, if it is shown to be in violation of law. Thus, if the Registrar passes any order, which is outside the ambit of his jurisdiction, i.e., power, which has not been conferred on .him by the Government, it can be declared as nullity in exercise of writ jurisdiction. In such a case it cannot be said that as there were no service rules governing the service of the Bank employees, the order passed by the Registrar is not open to challenge by invoking the writ jurisdiction. It would be preposterous to suggest that although a civil servant acting in connection with the affairs of the State has passed an order in violation of law, the same cannot be assailed because it relates to Bank employees. In the light of what has been stated above, we accept the appeal and setting aside the judgment of the High Court, we quash the order passed by the Registrar, Cooperative Societies, on 28th of February, 1991 promoting respondent No. 4, Aftab Aziz, as Deputy General Manager. The parties shall bear their own costs throughout. A.A./4/SC.A Appeal accepted.