1986 PLP 2519 (CLC)

(c) Constitution of Pakistan (1973)‑‑ ‑‑‑Art. 199‑‑Marketing of Petroleum Produce (Federal Control) Act (XVII of 1974), Ss.4 & 6(3)(b)‑‑Constitutional jurisdiction, exercise of Petitioner having been prejudiced for failure to afford him opportunity of being heard either by Government or by Authority‑‑High Court in exercise of constitutional jurisdiction directed respondents to decide case of petitioner afresh after giving him opportunity of being heard. Yousuf Rafi for Petitioner. A.S. Pingar with A.H. Mirza for Respondents. Date of hearing:, 10th April, 1986. MUHAMMAD ZAHOORUL HAQ, J.‑‑The petitioner, who claims to be the transferee of 50,000 shares of Premier Oil Company Limited from different previous owners, has felt aggrieved against the order passed by Premier Oil Co. Ltd. on 23‑5‑1975 rejecting the request of transfer of those shares and the consequent order of May, 20, 1977, passed by the same company informing the petitioner that their appeal submitted to the Chairman, Pakistan Petroleum Marketing Board has been rejected by the Government. The facts are not much in dispute. The petitioners claim to have purchased 50.000 shares by Dawood Petroleum Ltd., which was later on converted into Premier Oil Company Limited which in its turn is now known as Pakistan State Oil Company Limited. The petitioner applied for the transfer of the said shares in its name on 15‑4‑1974 and Dawood Petroleum Ltd. issued a receipt in respect of transfer of those shares but the shares were not transferred. Meanwhile the name of the company changed. On 20th May, 1975, the Premier Oil Company Limited informed the petitioner that the application for transfers lodged by it does not meet with the requirements of Marketing of Petroleum Products (Acquisition and Compensation) Rules, 1974 and hence it cannot be accepted. On June, 6, 1975 the petitioner wrote back that it had applied under provision for registration of transfer stipulated in the relevant rules and they submitted documents in support thereof. The documents submitted by the petitioners included 1923 scripts for 50,000 shares, transfer‑deed‑bearing signatures of the transferors and transferees and a declaration and a certificate in terms of section 3(2). On 9th August, 1976 the Premier Oil Company Limited wrote back to the petitioner to produce certified copies of broker's bills, Mode of payment to the broker, cheque number, date and amount of the cheque and name of Bank and Account Number. On August 23, 1976, the petitioner supplied the information required as above and attached the photo copies of broker's bills of 5‑5‑1973, 7‑5‑1973 and 8‑5‑1973 and also intimated that the payment to the broker was made by three cheques of which numbers, date and amount involving a total of Rs.4,52,237.50 was disclosed and the name of the bank was stated to be Habib Bank Ltd. Cloth Market Branch, Account No. 5399. Meanwhile, the petitioner had also sought the intervention of the Chairman, Pakistan Petroleum Marketing Board, by letters, dated July, 7, 1975 and July 15, 1975. They had also sent reminders in September and November, 1975, but only acknowledgment, dated July 21, 1975 had been received by the petitioner from Pakistan Petroleum Marketing Board. The petitioner had continued writing letters to the said Marketing Board in 1976 but it does not appear to have received any communication from them. Eventually, on 20th May, 1977 the Premier Oil Company Limited informed the petitioners that their appeal addressed to the Chairman Pakistan Petroleum Marketing Board had been considered and rejected by the Government and, therefore, the matter was considered as finally closed. In March 1977, the petitioner had also applied to the present respondent No. 2 for transfer of those shares (the Premier Oil Company had been merged with ESSO but later on ESSO was transformed into the present respondent No, 2). This had been done by the petitioner in pursuance of a notice published in Dawn Karachi, dated 7‑10‑1977, whereby the claims were invited by the present respondent No. 2 from the members of Premier Oil Company Limited. But no reply was received from respondent No.

2. The petitioner, therefore, filed this petition. Mr. A. M Mirza, Liaquat Merchant, Advocate, submitted that the petitioner had the alternate remedy under section 38 of the Companies Act, 1913, for rectification of the shares register. Mr. Yousuf Rafiq, Advocate, for the petitioner replied that section 4 of Marketing of Petroleum Product (Federal Control) Act, 1974 provides that the provision of this Act shall have effect notwithstanding anything in the Companies Act, 1913 etc. Section 6(3)(b) of this Act makes the Managing Director subject to such orders and such direction of the Federal Government as the Board of Management may be given from time to time in writing. The case of respondent No. 2 is that they have acted under the orders of Federal Government issued under section 6(3)(b) and that the Federal Government had conducted an inquiry against the petitioner and had found that the transferors of the shares to the petitioner were fictitious persons. This being the position, the action of the Federal Government cannot be challenged in the proceedings taken under section 38 of the Companies Act, 1913 and hence the objection in respect of alternate remedy is not justified. Mr. A.S. Pinger had taken the objection that the petition was directed against a limited company and, therefore, it was not a person under Article 199 of the Constitution of Pakistan hence the petition is not competent. The submission is not justified because the first prayer of the petitioner is directed against order which is shorn to have been passed by the Government in the letter of Premier Oil Company Limited, dated 20th May, 1977. Consequently, the petition is basically directed against the orders of the Federal Government. Respondent No. 2 which is a company has followed the orders of the Government, and it is bound to follow the orders of the Government as provided in section 6(3)(b) of the Act XVII of 1974, The petition is, therefore, competent as it is directed against the Federal Government basically. Mr. Yousuf Rafi, petitioner's counsel had contended that the petitioner had been condemned unheard. The submission appears to be justified as the counter‑affidavit of respondent No. 2 in para. 7 has taken the position that the transferees from whom the petitioner has alleged to have purchased the said shares were fictitious persons. The petitioners' contention is that it was never informed of any grounds of rejection of its application for transfer and that it was never provided an opportunity to meet the allegations in respect of fictitious transfers. No one has placed before us any material to show that the petitioner was ever heard in this matter either by the Government or by the respondent company, and it, therefore, appears to us to be clear that the petitioner has been prejudiced on account of failure of Federal Government of Pakistan to issue any notice to the petitioner to explain its position before they decided to reject the appeal of the petitioner which had been submitted to Pakistan Petroleum Marketing Board. The petition is, therefore, allowed and the Federal Government is directed to allow the petitioners to present it case before them. The respondent No. 2 would then automatically follow the directions which are to be issued by the Federal Government after hearing the petitioner in respect of transfer of 50,000 shares in its favour. H . B . T . Petition allowed.