1983 PLP 725 (PLC)

This appeal is directed against the order of the Presiding Officer, 1st Labour Court, Baluchistan, Quetta dated 29th July, 1982 whereby he allowed the respondent's application filed under section 25-A of the Industrial Relations Ordinance, 1969 (hereinafter referred to as the "I. R. O.") for re-instatement in service with back benefits.

2. Briefly the facts are that the respondent was employed as Cashier in the United Bank Limited, the appellant - herein ; when as alleged against him, he received an amount of Rs. 3,49,000 from a customer on 15th May, 1980 under a receipt but did not credit the entire amount to his account. The matter was reported to the Police and a criminal case was registered against him which is still pending. Subsequently the appellant served him with a charge-sheet on 4th April, 1981 which was replied by him (Annexure B) denying the allegation of misappropriation. However, he admitted that he might have signed the receipt through inadvertence. Finding the reply unconvincing, the appellant straightaway dismissed him from service, on 18th July, 1981. They latter served a notice upon the appellant as required under section 25-A of the I. R. O. and then brought an application before the Labour Court seeking re-instatement in service with back benefits. The application was allowed and his services were restored with back benefits mainly on the ground that enquiry as envisaged by Stand ing Order 15 (4) of the West Pakistan Industrial and Commercial Employ ment (Standing Orders) Ordinance, 1968 (hereinafter called the "Ordi nance") had not been conducted in the case, as such, the impugned order was illegal.

3. Mr. Munawar Ahmed Mirza, learned counsel for the appellant contended that the above said provision of the Ordinance did not apply to this case as the Ordinance did not apply in matters pertaining to disciplinary action to the appellant's organization. Rather, the Efficiency and Discipline (Banks and Financial Institutions) Rules, 1975 (hereinafter refer red to as the "Rules") framed by the First Wage Commission constituted under section 38-A of the I. R. O. applied to the appellant bank and entirely excluded the provisions of the Ordinance in this regard. On the other hand, Mr. Basharatullah contended that the Wage Commission Award did not occupy the status of statutory rules so as to be able to exclude the provisions of the Ordinance. He further maintained that the Wage Commission Awards were a kind of recommendations and had no force of statutory rules. Let us now examine the legal position of these arguments.

4. Standing Order 15 of the Ordinance safeguards the interest of the workman against any whimsical and capricious orders of termination of service therefore, it makes a provision for enquiry vide subsection (4) in all cases of termination of service. This provision also lays down the manner in which a domestic enquiry was to he held. But the provisions of this Standing Order are subject to the provisions of the Standing Order 1 which excludes from its operation all such commercial institutions as have been established under the authority of the Federal Government or any Provincial Government and had their own rules governing the service of their workmen. There are no two views about it that the nationalized banks are the insti tutions which had been established and are run under the authority of the Federal Government. It is also not disputed that the appellant's bank has no service rules of its own. However, some banks like the National Bank of Pakistan which too is a bank run under the authority of the Federal Government has its own statutory rules. Accordingly, the provisions of Standing Order 15 should normally apply to the appellant bank. However, Mr. Munawar's contention is that the "Rules" framed by the Wage Commission, constituted under section 38 of the I. R. O. in 1975 provide the rules to regulate service of their workmen and that under rules 4 and 5 thereof (reported on page 159 of the report of the Wage Commission for Banks and Financial Institutions 1974-75), it was not necessary for a banking or financial institution to enter into the formality of enquiry in each case of intended termination of service and that if the employer was satisfied after receiving the explanation of the employee that he was guilty of the misconduct alleged against him, he could straightaway terminate his services and that in this view of the matter, the appellant proceeded against the respondent on the authority of this rule, and so committed no illegality. He further referred to rule 26 of the Second Wage Commission Award (published in Extraordinary Gazette of Pakistan on 24th July, 1978) which confirmed rules 4 and 5 referred to above with certain modifications. This provision further points out that the rules aforementioned shall apply only to the institutions which had no statutory rules of their own. It also recommends vide the next following rule that all nationalized banks should frame their rules on the lines of the National Batik of Pakistan (Staff) Service Rules, 1973 ; meaning thereby, that the Wage Commission only made recommendations. Further that it did not frame the rules with any intention to make them permanent. Award of 1981 came into effect after the expiry of the Second Award. It also protected the above-said procedure vide its rule

153. It is thus manifest that the appellant's bank has no rules of its own and the only course open is either to deal with such cases under the "Ordinance" or otherwise under the "Rules". The question whether the Wage Commission Award excluded the operation of the Ordinance, has been controvertial for some time. Mr. Munawar referred to the case of Tufail Ahmed v. National Bank of Pakistan (1983 P L C 206). In this case the view of the Punjab Labour Appellate Tribunal is that disciplinary rules framed by the Wage Commission occupied the position of statutory rules and such rules are applicable to all the Banks and financial institutions, that had no statutory rules of their own. However, the contrary view was expressed by the Labour Appellate Tribunal Sind in Syed Ghazanfar Hussain Rizvi v. Habib Bank Limited (1980 P L C 1067) in it, that Mr. Justice Z. A. Channa, in this judgment held that the banks, although run under the authority of the Federal Government, were for all intents and purposes, commercial establishments and that the rules framed by the Wage Commission constituted for Banks and financial institutions, cannot be construed to b statutory rules. I would quote from this judgment as under :- "Section 38-H empowers the Wage Commission to fix interim rates of wages and the conditions of service of workmen in respect of whom it is constituted. Section 38-1 gives overriding effect to the provi sions of sections 38-A to 38-H, notwithstanding anything contained in any other law or in the terms of an agreement or contract of service. An examination of the above provisions indicates that nowhere the decision of the Wage Commission is either referred to, or Rules have been given the effect of Statutory Rules. As provided in section 38-D, the Commission's decision is to be deemed to be an award of the N.I.R.C. Whether, therefore, it be considered as an award of the N.I.R.C. or a decision of the Commission, in my respectful view, the same cannot be considered to be Statutory Rules for the purposes of the Standing Orders. As such I am of the view that the second requirement for being entitled to be exempted from the operation of the provisions of the Standing Orders is wanting in the instant case and hence the Standing Orders would be applicable to the respondent bank since admittedly it is a commercial establishment notwithstanding the fact that it is being carried on by o; under the authority of the Federal Government." Same view was reiterated in Syed Irshad Hussain v. Habib Bank Limited (1979 P LC 543). The view that the recommendations of the Wage Commission were not an award by the N.I.R.C. and thus binding on all concerned to the exclusion of the Ordinance is unassailable and I am in respectful agreement with Justice Channa. In these circumstances, the provisions IC of the Ordinance should have been followed by the appellant which he, failed to do. This flaw renders the impugned order as illegal.

5. Mr. Munawar next contended that the back benefits should also not have been allowed by the Labour Court as it had vacated the order of dismissal passed by the Bank only on a technical ground. In fact a person who has not been removed from service in accordance with law is liable to be treated in service and is thus generally entitled to all benefits which would have come to his share, had his services not been terminated illegally. May be in such cases where the workman has engaged himself in some profitable business afterwards, such benefits may be withheld but this would depend on the circumstances of each case which would guide the court in the exercise of its discretion. However, such is not the position in the instant case. The respondent is continuously out of service. In similar circumstances in Textile Corporation of Pakistan Ltd. v. Sind Labour Appellate Tribunal and another (N L R 1980 Kar. 172), it was held by a Division Bench that while re-instating a workman in service on the ground that Enquiry Officer's decision was absolutely illegal, the court should not deprive him of his legitimate dues. The instant case stands on better footings because here no enquiry had been held at all. Similar view was taken in Allied Bank of Pakistan Ltd. v. Punjab Labour Appellate Tribunal etc. (1980 P L C 42) and it was held that the order of re-instatement should be coupled with an~ order of back benefits unless specific reasons were given for denying the same. In the circumstances of the case, I do not find- any cogent reason to deprive the respondent of the back benefits.

6. The appeal is accordingly dismissed with no order as to costs. The appellant bank shall however, be at liberty to conduct domestic enquiry against the respondent in accordance with law. Appeal dismissed