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Petitioner: LIAQUAT NATIONAL HOSPITAL ASSOCIATION through Chairman, Governing Body and another VS Respondent: PROVINCE OF SINDH through Chief Secretary and 5 others
Court Name: Sindh High Court Judge(s): Shabbir Ahmed Title:LIAQUAT NATIONAL HOSPITAL ASSOCIATION through Chairman, Governing
Body and another vs PROVINCE OF SINDH through Chief Secretary and 5 others Case No.: Suit No,892 of 2000 Date of Judgment:2001-10-05 Reported As: PLD 2002 Karachi 359 Result: Application allowed Judgment ORDER Through this application, the plaintiffs have sought restraint order against the defendants from acting on the interim report dated 7-7-2000 and or from interfering in the affairs of plaintiffs in any manner pending disposal of the suit. The facts connected with this application are that plaintiffs, Liaquat National Hospital Association, a registered body was established on 18-5-1953, with Begum Rana Liquat Ali Khan, its first President who had appointed plaintiffs No,2 as the President of the plaintiff No,1 with effect from 13-5-1959. The members of the Governing Body since its inception varied in number from 9 to 18. At the time of suit, its strength was 17, inter alia, composed of two representatives from the Pakistan Red Crescent . Society, a former Surgeon General of the Army, persons from industrial concern as well Nas leading Scientists from A.Q. Khan Laboratory and highly reputed Medical practitioners. The plaintiffs established hospital known as Liaquat National Hospital and also Liaquat National Post-Graduate Centre recognized by Karachi University and College of Physician and Surgeons (hereinafter referred to as the Hospital). It is the case of the plaintiffs that there was no, public complaint or concern regarding its affairs. An unfortunate controversy' has been conjured by a former Member of the plaintiffs namely, I.H. Bhatti (defendant No,4), who also served as Medical Director till his resignation in the year 1999, who engineered a campaign of slander against the plaintiffs management and levelled unsubstantial allegations for personal and mala fide reasons only to gain control of the Liaqut National Hospital Association through back door. Though the plaintiffs received no financial help from the Government for the operation of the hospital; the defendant
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No,2 vide letter dated 21-4-2000 initiated an inquiry to investigate the allegations made by Mr. Bhatti although no allegation whatsoever were put to the plaintiffs. The plaintiffs fully' cooperated with the defendant No,2, whose team visited the hospital for three days and conducted thorough examination of the record. The report of defendant No,2 has not been made available but the plaintiffs has cogent reason to believe that the said report indicates its stand and discredits the wild allegations of Dr. I.H. Bhatti, notwithstanding the investigating by the team of defendant No,2, the then Minister Health Prof. S.M. Rab also examined the allegations of Dr. Bhatti with the explanation provided by the plaintiffs at the meeting held on 22-5-2000. Thereafter, the Minister submitted his report to the Governor though copy of report has not been supplied to the plaintiffs but the plaintiffs were informed that the allegations do not have any merit and were plainly made for personal reasons by Dr. Bhatti. In spite of two above inquiries, the Medical Director of the Hospital was called by defendant No,3 to appear before him and furnish documents. A copy of allegation was provided to the plaintiffs and its Director was asked to submit the written reply of unsigned complaint with prayer for following measures:-- (1) The Governing Body must be dissolved for financial and administrative irregularities and an administrator appointed to run the affairs of Liaqat National Hospital Association. Prof. I.H. Bhatti, who served LNH without salary for three years and effected major improvements in patient care and educational services, should be made the Administrator. (2) Ordinary and life memberships should be restored at the original rates and a proper general body should be formed. (3) The Governing Body and Executive Committees should be reconstituted under the rules of the Association. Both the Governing Body and the Executive Committee should have senior Doctors as regular members (in addition to the Medical Director who is an ex-officio member). (4) All financial irregularities must be investigated and appropriate action taken. The next meeting was scheduled for 11-7-2000 for filing of hospital's response to the allegations. However, the Chairman of the defendant No,3 called the Medical Director on 8-7-2000 and was provided with a copy of letter of Chairman of the defendant No,3, purported to be the interim report. The issuance of the interim report before the scheduled meeting confirmed that the entire exercise is mala fide, illegal and designed as sham to cover unjustifiable action proposed in the interim report. The basis of the interim report on the face of it ludicrous and farcical. Such action of the defendants is mala fide, without jurisdiction, inequitable and violation of the mandatory requirements of law. The defendants rendered themselves unfit to examine or investigate this matter due to the blatant bias and mala fide motivating their actions. The interim report dated 7- 7-2000, for suppression of the management with two options was submitted by defendant No,3 to the Governor in, the following terms:- Principal Secretary Governor Subject: Mal-administration--Liaquat National Hospital. Karachi Interim Report The Team has been apprised of the recommendation of Army Monitoring Team. Our views are in total conformity with those of Army Monitoring Team. 2. On scrutiny of records/documents received form Director, Medical Services Liaquat. National Hospital and numerous petitions by the terminated/relieved doctors have revealed the following observations: (a) Under clause 2 of the Articles of Association one of the category of members includes "Ordinary Member". The record of the Society (LNH) reflects that no ordinary member was inducted nor applications invited for such category of members. (b) Clause 3 of Articles of Association deals with the composition of the Governing Body consisting of a President and 24 members through election/selection. However the Registrar as well as the
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Management (LNH) confirms that the composition of the Governing Body was never 24, but varied from 9 to 17 members. Again a discre pancy! (c) The membership of the Society (LNH) has been restricted to a group of close associates which indicates ulterior motives. (d) Unilateral amendments enforced at the whims and fancies of management from time to time which were never got approved from the Registration Authority, thus lacking legal status. 2. The above observations/violations suffice for action under section 16-A, Societies Registration Act, 1860, envisaging an appointment of an Administrator with a specified agenda and holding of elections for transfer of the management to the new elected Governing Body. 3. Keeping the above mentioned observations in view, it is however felt that the following options can be exercised to save the institution from collapse/mismanagement and internal blacking lefts which are likely to continue if no firm decision is enforced now:-- (a) OPTION-1 (1) Governing Body be dissolved and an Administrator appointed. (2) Removal of the present Director Medical Services. (3) Review termination of petitioners/others for reinstatement on fresh contracts/conditions. (b) OPTION-2 (1) Dissolve the Governing Body and install the present Chairman as patron for life owing to his long association with the institution. (2) Remove the present administration and appoint an Administrator. (3) A committee may be formed under the rules of Society (LNH) enabling Administrator to form a Governing Body by 1st August, 2000. (4) Administrator, Chairman Governing Body, Member-III of Governor's Inspection Team review termination and other arbitrary decisions to clear friction areas. By this process restore this institution as an organized body. (5) Decision on the options available will be placed before Chaimian, Governing Body (LNH). You are requested further guidance. (Brig. Retd. A.S. Nasir), Chairman. Hence the suit with the following prayer:-- (1) Declare that actions of the defendant No,3, specifically the Interim Report dated 7-7-2000 is mala fide and illegal. (2) Declare that the defendants by their actions set forth in the Plaint have rendered itself incapable of fair and impartial probe into the allegations sponsored disgruntled former members of LNHA. (3) Restrain the defendants from acting in any manner whatsoever on the Interim Report dated 7- 7-2000. (4) Restrain the defendants from interfering in the affairs of the plaintiff No,1 in any manner whatsoever. (5) Appoint an appropriate independent authority to investigate the allegations made against LNHA and pending thereto, to restrain any adverse action. (6) Grant any other or better relief that this Hon'ble Court feels just and equitable in the circumstances. (7) Grant costs to the plaintiffs. During the proceeding, the plaintiffs asked for the discovery of document mentioned in the application, particularly, the reports in terms of Order 11, Rule 12, C.P.C. The defendant No,3 through affidavit denied having any of document in their possession though the interim report was based on the recommendation of Army Monitoring Team.
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The plaintiffs No,2 namely, Wajid Ali Shah filed his own affidavit affirming the above facts in his affidavit. The application has been opposed through counter-affidavit filed by Farooq Azam, Secretary of defendant No,3, wherein the allegation of plaintiffs were denied with the plea that the suit is liable to be dismissed as the same is not maintainable nor the plaintiffs are entitled for any relief. The plaintiffs have failed to make out a case for injunction. The plea taken was that according to Rule 3 of Rules and Regulations of the Association, the required strength of the Governing Body is 24, including its President. The procedure for nomination of members of the Governing Body has been laid down in the said rule. The strength of 24 members has never been attained by the Association, which is a discrepancy being perpetuated by the plaintiffs. The initiation of inquiry was admitted, issuance of interim report was also admitted but with a plea that plaintiffs has failed to understand the purpose of interim report, which was not in any case a final inquiry report but was merely a report seeking the guidance of the Governor, prepared on the basis of conclusion of the inquiry conducted by defendant No,2, in the following terms:-- (a) Difference of approach between Hospital Administration and some consultants as to the direction in which the hospital should be headed i,e, whether to make it into a full time Post Medical Centre or not. (b) Prolonged leadership under autocratic system has brought .It stagnation and inertia into the governing system. The present Governing Body needs to be reconstituted to ensure more representative discussion before taking important decisions and to check monopolization. The defendants Nos. 4 to 6 were joined on their own request have also opposed the application by taking common grounds and pleas. The defendant No,4, namely, Iqtidar Hamid Bhatti through verbose counter-affidavit has opposed the application precisely the grounds taken, inter alia, are as follows: 1. There was no compliance of the by-laws, the running of Post Medical Graduate Centre is without the reorganization of Pakistan Medical and Dental Association and the members of the Governing Body are close and family members/associates and employees or of companies controller and managed by the Chairman. I have heard Mr. Zahid F.Ibrahim learned counsel for the plaintiffs and Ch. Muhammad Rafiq, Additional Advocate-General, Sindh for defendants Nos. I to 3 and Mr.Naimur Rehman, learned counsel for the defendants Nos.4 to 6. At the very outset, the learned Additional Advocate-General has stated that the interim report has been withdrawn by the defendants. His further submission was that such statement was filed on 12-1-2001, with letter dated 27-11-2000 of the defendant No,3 that no action, whatsoever, was being contemplated on such report. The application was opposed on the plea that the relief claimed through application as well as in suit is barred under the provision of section 56 (d) of Specific Relief Act, which I will discuss later. Mr. Zahid F.Ibrahim, learned counsel. For the plaintiffs has vehemently urged that two inquiries, first by Army Monitoring Cell, and second by the then Health Minister Mr. S.M. Rab, have vindicated the stand of the plaintiffs. The plaintiffs asked for the reports through an application for discovery of documents but was not provided on the plea that the same are not available with them but interim report has been prepared on the basis of such report. It may be mentioned that the copy of report of inquiry conducted by the defendant No,2 has been placed on record by Mr. Naimur Rehman, learned counsel for the private defendants. Although the learned Additional Advocate-General was unable to obtain and produce the same in spite of several opportunities provided to him. It was further contended by him that Association was running the affairs of the hospital without any cause or complaint from any quarters. For the first time, on 21-4-2000, the trouble started when
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the hospital was visited three times by the defendant No,2, though the Association was not informed about the contents of the complaint. The then Health Minister also conducted separate inquiry and submitted his report on 22-5-2000. The report of the Minister also vindicates the position of the plaintiffs. After submission of the report in the month of May In very next month the Government of Sindh issued Notification whereby Committee was constituted to probe into the matter pertaining to the malpractice in hospital. The plaintiffs received a letter dated 19-6-2000 requiring the plaintiffs to attend the meeting on 24-6-2000 with documents/record at the first place specified therein. The plaintiffs responded such notice through their letter dated 21-6-2000 intimating the Committee that two inquiries were already conducted, as stated above, but no evidence of malpractice was found. The reply was also submitted. Learned counsel further contended that though the term 'malpractice' was used as allegation but no detail was mentioned, which was only bald allegation with the purpose, to take the control of the hospital and appoint Mr. I.H. Bhatti. The next meeting was scheduled on 11-7-2000, before the scheduled meeting the interim report came to the light when it was received by the plaintiffs. The learned counsel for the plaintiffs further contended that the interim report was prepared 4 days in advance with the object to take over the management and to appoint an Administrator. The learned counsel in support of his contention contended that, no doubt, the Provincial Government can supersede a Governing Body of the Association under the provision of section 16- A but such power and supervision is subject to the grounds enumerated in section 16-A of the Societies Registration Act, which enjoins the Provincial Government, if it comes to the conclusion that the Governing Body of the Association is (a) unable to discharge or persistently failed to discharge its duties; (b) unable to administer its powers; (c) generally acts in a manner contrary to public interest or interest of the members of the Society. The Provincial Government may by a Notification in the Official Gazette declare the Governing Body to supersede for such a period not exceeding one year as may be specified in the Notification. He further contended that section 16-A was further amended by Ordinance 41 of 1984, whereby a proviso was brought on the Statute Book under the direction of Federal Shariat Court for amendment in the Societies Registration Act, 1860, which proviso reads as under:-- "No Governing Body shall be superseded unless it is given an opportunity of being heard." On the basis of the above proviso, learned counsel for the plaintiffs argued that the interim report offends the said provisions as the same was prepared without giving opportunity to the plaintiffs of hearing. His further contention was that the Provincial Government can supersede the Governing Body on any of the grounds mentioned in subsection (1) of section 16, clause 3(A) of the .Societies Registration Act, when the Society is unable to discharge or persistently fails to discharge its duty, unable to administer its affairs or to meet its obligations and generally acts in a manner contrary to the public interest or interest of the members of the Society. He further contended that the interim report contains four grounds. None of the grounds mentioned in the interim report can be categorized the grounds available in section 16-A. On the above premises, he contended that the action of the defendants in initiation of third inquiry is unjust, unfair and unreasonable. He contended that the executive discretion over the private right cannot be exercised at the whims of the executive authority. Such discretion must have a basis and such basis must be reasonable, fair and just in the circumstances of the case and to support his case has referred Messrs Abdullah & Co. v. Province of Sindh (1992 M LD 293), wherein the following observation was made:-- "Power of discretion which affected individual rights was required to be exercised in a fair, reasonable and just manner. An executive discretion which affects private rights cannot be exercised at the whim of the Executive Authority. It must have a basis and such basis must be reasonable, fair and just in the circumstances of the case.
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To further support his contentions, he referred cases Chairman, Regional Transport Authority, Rawalpindi v. Pak Mutual Insurance Co. Ltd., Rawalpindi (PLD 1991 SC 14), wherein discretion of the Executive Authority in the line of American Jurisprudence, 2nd Edition, Volume 63-A was examined. Mr. Zahid Ebrahim also referred Dr. Muhammad Asghar Malik v. Auqaf Department (1998 M LD 76), wherein the mode of exercise of discretionary power vested in the public functionary was elucidated in para.5 of the report as follows:-- "5. The theory of discretion as relied by the learned counsel for the respondent cannot be countenanced in the present day society where the functionaries of the State are expected to conduct themselves fairly, justly and equitably meaning thereby that even in the case of exercise of discretion it must be shown that the discretion so exercised is not only fair but also just and equitable in the circumstances of the particular case because after all the functionaries of State, vested with powers to carry out certain functions of the sovereign, de not expected to assume the role of absolute rules. The purpose afore noted can only be achieved if the proposed action is shown to be bona fide, supported by reasons, therefor, and is taken with due diligence and required element of prudence and caution. The theory of exercise of discretion and the structuring thereof has been amply dealt with in the case of Chairman, R.T.A. v. Pak Mutual Insurance Company Ltd., Rawalpindi (PLD 1991 SC 14) wherein a profuse reference has been made to American Jurisprudence, 2nd Edition, Volume 63-A (Public Officers and Employees) sections 7, 308, 315 and 317. The wisdom contained in these sections is to the following effect:-- "A public office is a public agency or trust created in the interest and for the benefit of the people, and since an incumbent of a public office is invested with certain powers and charged with certain duties pertinent to sovereignty, the powers so delegated to the officer are held in trust for the people and are to be exercised on behalf of the Government or of all citizens who may need the intervention of the officer. Such trust extends to all matters within the range of the duties pertaining to the office. In other words, public officers are but the servants of the people and not their rulers. A public officer is amenable to, the rule which forbids an agent or trustee to place himself in such an attitude towards the principal or cestui que trust as to have his interest conflict with his duty. Where a statute is silent with respect to the time within which an official act must be performed, the law contemplates that the duty must be performed within a reasonable time. A public official who undertakes to perform an act, even an act which is completely discretionary, must do so reasonably and in complete good faith without such delay as would frustrate its ultimate objective.... One who accepts a public office does so cum on ere, or with the burden, and is considered as accepting its burdens and obligations with its benefits. He thereby subjects himself to all Constitutional and legislative provisions relating thereto and undertakes to perform all the duties of the office, and while he remains in such office the public has the right to demand that he ,performs such duties. The acceptance of every public office implies an agreement on the part of the officer that he will execute its duties with diligence and fidelity. The duty of a public officer to fulfill the obligations of his office should take precedence over all other matters... Every public officer is bound to use reasonable skill and diligence in the performance of his official duties, particularly where rights of individuals may be jeopardized by his neglect. In other words, he is bound, virtue official, to bring to the discharge of his duties that prudence, caution, and attention which careful men usually exercise in the management of their own affairs." Mr. Zahid has further contended with vehemence that the interim report whereby the supervision of the Governing Body and appointment of Administrator has been proposed is without show- cause notice to the plaintiffs and the ground taken for exercise of such powers is beyond the provisions. The initiation of further inquiry is nothing but to satisfy the former Director, the defendant No,4, who himself has resigned from the directorship and praised the services of Chairman in his letter dated 11-8-1999. The defendant No,4 now wants himself to be appointed as Administrator by
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removing the present Governing Body. It has been also pointed out by Mr. Zahid F. Ibrahim, learned counsel for the plaintiffs that on 19-8-2000, new Governing Body was formed and communicated to the Registrar, 'Joint Stock Companies, Government of Sindh on 6-9-1992, and the composition of the Governing Body are as under:-- COMPOSITION OF THE GOVERNING BODY PRESIDENT: SYED WAJID ALI SHAH Co-opted by the Governing Body: (1) Sardar Sherbaz Mazari, (2) Mr. Illahi Buz Soomro. (3) Sardar Akhtar Mengal. (4) Mr. Zulfiqar Ali Shah Jamot. (5) Dr. Faridoon Sethna. (6) Dr. Yaseen Ali. (7) Chairman, Faculty L.N.H. Nominated by the President: (1) Mr. Justice (Retd.) Mahboob Ahmed. (2) Dr.Zafar H. Zaidi (3) Dr. Qasim Mehdi. (4) Lt.-Gen (Retd.) Arshad Hussain. (5) Mr. Riyaz H. Bokhari. (6) Mr. Mohammad Hanif. (7) Mr. Tariq Hamid. (8) Syed Shahid Ali. (9) Mr. Muhammad Shafique. (10) Mr. Aftab Shafique. (11) Mr. Humayun Hanif. (12). Mr. Basit H. Syed. (13) Dr. Moizuddin, Medical Director. (14) Mr. Adi Cawasji (Honorary Treasurer). (15) Mr. M.S. Baig, Secretary. Nominated by the Red Crescent Society, Islamabad: (1) Air Marshal (Retd.) Sheikh Muhammad Saeedt (2) Brig. (Retd.) Dr. A.R.K. Burki. Mr. Ch. Muhammad Rafiq, A.A.-G submission was that prayer for injunction in the suit is barred by clause (d) of section 56 of the Specific Relief Act, which lays down that an injunction could not be granted to interfere with the public duties of any department of the Central Government, or any Provincial Government, or with the sovereign act of a Foreign Government. It is true that under this clause no injunction be granted against the Department of Government including individual officers of the Department so as to interfere in their public duties authorized by law but where the department or its officers exceed or abuse the powers conferred upon them by the Legislature, this clause cannot apply. The State functionaries are expected to act fairly and justly in a manner not to give to any one a cause of complaint or of being accused of biased treatment; but the experience is otherwise. Due to discriminate and partitioned behaviour of the officials, the sanctity attached to the official act has been eroded, gradually such erosion was noticed by Legislatures in India, while enacting Specific Relief Act of 1963, such immunity was withdrawn. Section 41 is analogous to the existing section 56 of the Specific Relief Act, the provision contained in clause (d) of section 56, was not retained in…
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