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Petitioner: The CITIZENS FOUNDATION and another VS Respondent: DIRECTOR, SESSI and others
Court Name: Supreme Court of Pakistan Judge(s): Khilji Arif Hussain, Rehmat Hussain Jaffery, Anwar Zaheer Jamali Title: The CITIZENS FOUNDATION and another vs DIRECTOR, SESSI and others Case No.: Civil Appeals Nos.1313 and 1314 of 2008 Date of Judgment:2010-06-16 Reported As: 2010 SCMR 1659 Result: Appeal dismissed
JUDGMENT
JUDGMENT ' ANWAR ZAHEER JAMALI, J.---The above titled two civil appeals arise out of common judgment dated, 25-4-2008, passed by a learned Division Bench of Sindh High Court at Karachi, whereby, petitions filed by the present appellants, along with another identical Constitutional Petition No,D- 165 of 2006, by some other petitioner, involving similar controversy, were dismissed. We, therefore, propose to dispose of both these appeals by this common judgment. 2. Briefly stated, relevant facts forming background of this litigation are that the two appellants i,e, Messrs City School (Pvt.) Ltd, and the Citizen Foundation both running educational institutions, with the only distinction in their cases that the latter one (Citizens Foundation) claims to be doing so on charitable basis, have challenged the two notifications of identical nature dated 5-12-1996 and 6- 3-2003 respectively, issued by the Govt. Of Sindh in exercise of its powers conferred by subsection (iii) to section 1 of Sindh Employees Social Security Ordinance, 1965 (in short "Ordinance of 1965"), thereby, amongst others, including the names of their respective educational institutions in the list of Establishments, whose employees will be now covered under the Ordinance of 1965 and entitled to the benefits of their schemes to the extent and in the manner as provided under sections 35 to 45 of the Ordinance of 1965. The names of the present appellants respectively appear at Serial Nos.20 to 22 of the notification, dated 5-2-1996 and Serial No,324 of the notification, dated 6-3- 2003. ' In a nutshell, in both the petitions before the High Court, grievance of the petitioners was that their educational institutions, which have been subjected to the scheme of Ordinance of 1965 through impugned notifications issued by respondents Nos. 1 and 2, were not the institutions covered by the definition of word "establishment" as defined under section 2(11) of the Ordinance of 1965.
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4. Mr Arshad Tayabaly, learned counsel for the appellant addressing the court in Civil Appeal No,1313 of 2008, vehemently contended that under subsection (11) to section 2 (ibid), defining word "establishment" for the .Purposes of Ordinance of 1965, use of words `industrial', 'commercial', agricultural', each having different connotations, followed by the words 'or otherwise', applying the well recognized principle of "ejusdem generis" will not cover the cases of the present appellants, as neither they are industrial, commercial or agricultural establishments covered under the scope of word "establishment", nor the use of words "or otherwise" will extend its scope to cover the case of appellants, being educational institutions. He further argued that an educational institution which is being run on charitable basis is rendering great service to the nation to educate poor people, therefore, it cannot he subjected to the scheme of the Ordinance of 1965 to burden it with extra financial liability in the form of payment of contribution to respondent No,2 in their capacity as employer. In support of his submissions, learned counsel placed reliance upon the case of Don Bosco High School Empress Road Lahore v. Director Social Security 2005 PLC 110. 5. However when confronted with an unreported judgment of this Court dated, 29-9-2005, learned counsel did not dispute that any reference to the judgment cited by him, which contains some observations in support of petitioners' case, will be an exercise in futility as the said judgment dated, 2-12-1999, whereby several identical petitions containing the same controversy in the context of definition of word 'establishment' under section 2(11) of the Ordinance of 1965, was set aside by this Court in all such identical petitions, vide common judgment dated, 29-9-2005 with the following observations:- "Be that as it may, after hearing learned counsel for the parties at quite some length and without entering into facts of the case, we are of the considered opinion that the submissions advanced at the Bar have sufficient force and the resolution thereof, involves indepth enquiry into various factual aspects, which cannot be undertaken by this Court in the exercise of Constitutional jurisdiction. It would, therefore, be just, fair, proper and expedient in the interest of justice to direct the respondents, as voluntarily offered by them, to place their grievance before the relevant authorities in terms of the provisions referred to above against the impugned action. On their part, the authorities shall determine their liability afresh on the basis of the material that may be produced by the respondents and pass a fresh order strictly according to law. With these observations, impugned judgments of the High Court are set aside and appeals disposed of by remanding the petitions to the Social Security Institution Punjab, Lahore for decision afresh in terms as indicated above. No order as to costs." 6. Mr. Khalid Javed Khan, learned counsel representing appellant in the other connected Appeal No,1314 of 2008, endorsing the submissions of learned counsel for the appellant in Civil Appeal No,1313 of 2008, further added that use of words "or otherwise" in subsection (11) to section 2 of the Ordinance of 1965 will not extend its scope in the manner that educational institutions could also be brought under the umbrella of word "establishment" as defined under the Ordinance of 1965. Learned counsel, however, did not dispute that the appellants in this case are not educational institutions which are being run on charitable basis, but essentially a commercial venture. Learned counsel in support of his submissions, also cited the cases reported as (a) K.G. Old v. Presiding Officer, Punjab Labour Court 1976 PLC 675, (b) Employees Union v. Registrar of Trade Unions 1981 PLC 403, and (c) Board of Governors Aitchison College v. Punjab Labour Appellate Tribunal 2001 SCMR 1928. (a) In the above cited K.G. Old's case (supra), learned single Judge in the chambers of Lahore High Court, dilating upon the principles of interpretation of statute, examined the import of words 'business', 'trade', 'manufacture', 'calling', 'service', `occupation' as defined under Industrial Relations Ordinance, 1969, and held that these words were to be used with widest amplitude to include in their sweep every conceivable human activity other than casual, recreational or a past time. After
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detailed discussion of case law and the definition of these words in different renowned English dictionaries, the learned Judge concluded as under:-- (52) The upshot of the entire discussion is 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 organized and is systematic depending substantially, if set entirely, on the cooperation between labour and capital, and having as its object production, distribution and consumption of wealth, off, the production or provision of material services. The enterprise as a whole has to be looked at to find out its raison d'etre, and any part of it which is incidental; ancillary or an adjunct cannot determine the character of the whole. (53) Applying these tests to the individual cases we find that Christian Technical Training Centre is an educational and training establishment. If it is maintaining an industrial unit (a workshop) rendering services on payment, advertising its product, it is as an incidence of vocational education and of training programme designed to ensure job opportunities to the trainees. Therefore, what is incidental to the main purpose cannot detract in any manner, from its being an educational institution. (b) In the next case of Employees Union (supra), while dealing with a case under the Ordinance of 1965 and considering the principle of interpretation of statute viz harmonious construction of different provisions of a statute, the High Court laid down as under:-- "In the light of the foregoing discussion regarding language used, the separability and interaction of the two parts of section 81 and their placement (as done in the earlier reproduction) its provisions become tangible besides being operative in each and every part thereof. Thus, applied the exercise made in the Karachi case of Mst. Lai Jan regarding inconsistencies in the sense of incompatibility, would have to be made in every case of the present type. After doing the same it would be resolved whether or not the benefit and/or compensation available under any of the laws mentioned in the first part of section 81, would not be obtainable in addition to the benefits under the Social Security Ordinance. In this case proper comparison was made by the special' forums constituted in this behalf, on the lines as was done in the Karachi case of Mst. Lai Jan. The compensation available under the Workmen's Compensation Act to the appellant was not found inconsistent/incompatible with the relevant benefits under the Social Security Ordinance. Accordingly both the benefits under both the laws could be obtained by the appellant. That being so this appeal merits acceptance." (c) In the last case of Board of Governors Atchison College (supra), while dealing with a case under the Industrial Relations Ordinance, 1969, it was held after taking into consideration the definition of word "industry" under the said Ordinance XXIII of 1969, that without any doubt, it can be deemed that institutions responsible for imparting education like the appellant's organization do not fall within the definition of industry. Further reference to the case of University of Delhi and others v. Ram Nath and others (AIR 1963 SC 1873) was made, wherein the Court had observed as under:- "(8) It is true that like all educational institutions the University of Dehli employs subordinate staff and this subordinate staff does the work assigned to it; but in the main scheme of imparting education, this subordinate staff plays such a minor, subordinate and insignificant part that it would be unreasonable to allow this work to lend its industrial colour to the principal activity of the University which is imparting education. The work of promoting education is carried on by the University and its teachers and if the teachers are excluded from the purview of the Act, it would be unreasonable to regard the work of imparting education as industry only because its minor subsidiary anti incidental work may seem to partake of the character of service which may fall under section 2(j)."
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7. In addition to it, both the learned counsel also seriously criticized the policy of pick and choose, which according to them, has been followed by the respondent No,2 institution since its inception, in notifying the names of various establishments, being discriminatory and violative of fundamental rights guaranteed under Article 25 of the Constitution, thereby opening a gateway for corruption in the institution on the basis of personal liking and disliking. 8. Conversely, Mr. S.A. Sarwana, learned counsel for the respondent in both the appeals, at the outset, read the preamble of the Ordinance of 1965, and Articles 2-A and 38(c)(d) of our Constitution to substantiate his submission that the definition of word "establishment" under section 2(11) of the Ordinance of 1965, wherever possible, was to be interpreted liberally and widely, as the scheme envisaged under the Ordinance of 1965 is wholly beneficial in nature, therefore, the employees of educational institutions like the appellants may not be deprived of its benefit. He reiterated that the definition of word 'establishment' in the Ordinance of 1965 is to be read in a wider sense to extend its benefit to the employees of educational institutions, running on commercial or even charitable basis, which makes no difference for the purpose of applicability of the Ordinance of 1965. Learned counsel, with reference to the definition of 'establishment' provided in subsection (11) to section 2 of the Ordinance of 1965, further contended that use of words 'industrial, 'commercial' and 'agricultural' with the addition of words "or otherwise" at the end, has enlarged and widened the scope of its definition, so as to cover any type of educational institution, irrespective of the fact, whether being run on commercial basis or charitable basis. In order to demonstrate the beneficial character of the Ordinance of 1965, learned counsel further made reference to chapter-V of the Ordinance of 1965, particularly sections 35 to 42. To add force to his contentions in this regard, he placed reliance on the reported cases (1) Sakina Bibi v. Crescent Textile Mills Ltd. PLD 1984 SC 241, (ii) Kohinoor Chemical's case PLD 1977 SC 197, (iii) Shaheen Airport Services v. Sindh Employees Social Security Institution 1994 SCMR 881, (iv) Holy Family Hospital v. Government of Sindh 1985 SCMR 593 and, (v) MacDonald Layton Constain Ltd. V. Punjab Employees S.S.I. PLD 1991 SC 1055. (i) In the case of Sakina Bibi, applying the principle of harmonious construction of a statute, keeping in view the beneficial nature of the Ordinance of 1965, the scope of section 81 of the Ordinance of 1965 was examined and following observations were made:-- "In the light of the foregoing discussion regarding language used, the separability and interaction of the two parts of section 81 and their placement (as done in the earlier reproduction) its provisions become tangible besides being operative in each and every part thereof. Thus, applied the exercise made in the Karachi case of Mst. Lai Jan regarding inconsistencies in the sense of incompatibility, would have to be made in every case of the present type. After doing the same it would be resolved whether or not the benefit and/or compensation available under any of the laws mentioned in the first part of section 81, would not be obtainable in addition to the benefits under the Social Security Ordinance. In this case proper comparison was made by the special forums constituted in this beialf, on the lines as was done in the Karachi case of Mst. Lai Jan. The compensation available under the Workmen's Compensation Act to the appellant was not found inconsistent/incompatible with the relevant benefits under the Social Security Ordinance. Accordingly both the benefits under both the laws could be obtained by the appellant. That being so this appeal merits acceptance." . (ii) In the case of Kohinoor Chemicals, the scope of words `employees' and 'establishment', as defined under section 2(8) and (11) of the Ordinance 1965 was considered indepth and, applying some well recognized principles of interpretation of statutes, following observations were made by the Court:- "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
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accepted principle of interpret -I as observed in Divisional Superintendent, P. W. R., Karachi v. Bashir Ahmed PLD 1973 SC 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." ' Viewed in this light, the term 'establishment', as defined in clause (11) of section 2 of the Ordinance, does not appear to me to be confined in its scope to merely the four walls of the physical premises where the notified establishment may be located; on the contrary, the definition speaks of an organization whether industrial, commercial, agricultural or otherwise. In its literal sense an organization 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. It follows, therefore, that an organization is not necessarily co-terminus with the physical premises where it may be located. It is possible that a part of its structure may be situated elsewhere, but it must, nevertheless be integral to its main functions and objects. ' That this is the proper construction of the term 'establishment' appears to find support from the definition of the term 'employee as given in clause (8) of section 2 of the Ordinance, which includes in the definition not only a person working in the industry or establishment but also "in connection with the work of any industry, business, undertaking or establishment. It is clear to me that a person who is working "in connection with the work of" an establishment may not necessarily be physically located in the notified premises, but may be elsewhere, of course, within the social security area as notified under clause (3) of section 1 of the Ordinance. The essential test in such a case would be whether the person concerned is indeed working in connection with the work of the notified establishment" (iii) In the case of Shaheen Airport Services, again the scope of applicability of Ordinance of 1965, keeping in view its beneficial character, was ably discussed with reference to various principles of interpretation of statutes and following observations were made:- "(6) There cannot be any cavil with the proposition that the Court cannot construe even a beneficial statute in such a way that it may violate its provisions nor the Court can place a beneficial interpretation on a provision contrary to its language merely on the ground that its literal construction will cause hardship or would not be beneficial to the class for whose benefit the statute in question was enacted. However, at the same time, the Court, while construing a beneficial enactment, can take into consideration the object for which it was enacted and the mischief which it intended to suppress, and if two possible constructions of a provision of such a statute are possible, one which favours the class of persons for whose benefit the statute has been enacted, would be preferred. In the case in hand, the Ordinance is a specie of a statute which was to be enacted by the State with the object of promoting social and economic well-being of the people and, therefore, it is a beneficial enactment intended to provide social security to the workmen covered by the provisions of the same end, hence, it is to be construed liberally and if two constructions are possible, one which extends the benefit of the Ordinance to more workmen and the other which limits such benefit, the former is to be preferred." (iv) In the case of Holy Family Hospital (supra), the scope of definition of word 'establishment' as defined under section 2(b) of the Workers' Children (Education) Ordinance of 1972, keeping in view its beneficial nature, was considered and in that context following observations were made: "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
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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 object of the legislation so as to advance the remedy and suppress the mischief or else it would defeat the very legislative intent." (v) In the last case of Macdonald Layton Constain Limited, with reference to the scope of word 'establishment' as defined under section 2(11) of the Ordinance of 1965, qua Article 2A of the Constitution, following useful observations were made by this Court:-- ' The learned counsel next contended that the petitioner/Company having itself made adequate arrangements for the Social Security cover, the High Court should not have interfered in the circumstances of this case. The criticism and-the conduct of the petitioner in the order of the Commissioner, a part of which has already been quoted above, indicated otherwise. Unfortunately we cannot help making an observation that the petitioner, in order to deprive a section of labour class employed by them, of due benefits under the Ordinance, took up untenable pleas and adopted such positions which it was difficult to establish. In such a please situation under the Islamic dispensation, even if the case for both the sides had been equally balanced in order to act advance the command regarding social justice, as contained in the Objectives Resolutions, the decision to be rendered by this Court would have gone in favour, of upholding the workers' right to the Social Security Cover. In the petition before us it is not even a case of equal strength of both the parties." 9. He also forcefully contended that upon use of word "or otherwise" in section 11(2)(ibid), the rule of "ejusdem generis" has lost its applicability and force. For this purpose he further placed reliance on the following cases:-- (a) Pir Sabir Shah v. Federation of Pakistan PLD 1994 SC 738. (b) Don Basco High School v. Assistant Director EOBI PLD 1989 SC 128 (c) Lila Vati Bai v. Bombay State AIR 1957 SC 521 (d) National Association of Local Government Officers v. Bolton Corporation (1942) 2 All England Reporter 425 (HL). (a) In the first case, dilating upon the provisions of Article 234 of the Constitution qua connotation of word "otherwise", after making reference to a plethora of case law, a larger Bench of this Court recorded its observations as under:-- " The term "otherwise" has a very wide connotation, it will cover information acquired by the President from any other source than the Governor. Thus, a proclamation founded on information other than the Governor's report will be valid if it is in consonance with Article 234(1) of the Constitution." (b) In the second case of Don Basco High School (supra), with reference to the principle of interpretation of statute, the applicability of rule of "ejusdem generis" was examined in the context of somewhat identical controversy with reference to the definition of term 'establishment' under section 2(e) of the Employees Old-Age Benefits Act (XIV of 1976) qua its applicability to the educational institutions (schools) and it was held that the mere fact that a school was not being run for profit or gain cannot be a reason for excluding it from the definition of word 'establishment' under the Employees Old-Age Benefits Act. Further in this case with reference to the inclusion of schools under the definition of 'establishment' qua doctrine of ejusdem generis following useful discussion was made by the Court. "According to 'Maxwell on the Interpretation of Statutes, 12th Edition, page 297, it is a well established rule in the construction statutes that "general terms following particular ones apply only to such persons or things as are ejusdem generis with those comprehend in the language of the Legislature; R. V. Cleworth (1864) 4 B & S.927, per Cockburn C.J. At 932. In other words, the
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general expression is to be read as comprehending only things of the same kind as that designated by the preceding particular expressions, unless there is something to show that a wider sense was intended (emphasis supplied)". Reference is made by the author to R.V. Edwardson (1859) 28 L.J.M.C. 213). ' According to Corpus Juris Secundum, Volume 82, page 658 the rule or doctrine of 'ejusdem generis' will apply unless intention to the contrary is clearly shown. The relevant passage may be quoted here. It reads: "Where general words follow the enumeration of particular classes of persons or things, the general words, under the rule or maxim of construction known as 'ejusdem generis,' will be construed as applicable only to persons or things of the same general nature or class as those enumerated, unless an intention to the contrary is clearly shown."…
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