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Petitioner: AKHTAR HUSSAIN CHAUDHRY VS Respondent: AGRICULTURAL DEVELOPMENT BANK OF PAKISTAN
1993 P L C (C
1993 P L C (C.S.) 1298
[Lahore High Court]
Before Irshad Hasan Khan, J
AKHTAR HUSSAIN CHAUDHRY
Versus
AGRICULTURAL DEVELOPMENT BANK OF PAKISTAN through its Chairman and another
Writ Petition No. 4466 of 1984, decided on 18th April, 1993.
(a) Agricultural Development Bank Ordinance (IV of 1961)‑‑‑
‑‑‑‑S. 39‑‑‑Agricultural Development Bank (Staff) Service Regulations, 1961, Regln. 13‑‑‑Agricultural Development Bank (Staff) Service Regulations, 1961 were not promulgated with the approval of Federal Government as at the time of their promulgation, no approval of the Federal Government was necessary under S.39 of the Ordinance‑‑‑Board of Directors was competent to make Regulations to provide for matters which it thought necessary or expedient for giving effect to the provisions of the Ordinance and for the efficient conduct of the affairs of the Bank.
(b) Agricultural Development Bank (Staff) Service Regulations, 1961‑‑‑
‑‑‑‑Regln. 13‑‑‑Agricultural Development Bank of Pakistan Officers (Efficiency and Discipline) Regulations 1975, Regln. 95‑‑‑Two distinct powers available to competent Authority to decide whether action proposed to be taken against any of its officers should be taken in accordance with Regln. 13, Agricultural Development Bank Service Regulations, 1901 or under Regln. 95, Agricultural Development Bank of Pakistan Officers (Efficiency and Discipline) Rules, 1975‑‑‑Competent Authority was empowered to invoke either of two different modes for terminating services of employees unless impugned order was shown to be mala fide either in fact or in law‑‑‑Where absolute discretionary power of removal from service had been conferred on a statutory corporation or body without assigning any reason, exercise of such power to be immune from judicial scrutiny, must be accompanied by absence of taint of mala fides, or guarantee of tenure of service available under the statute or the regulations framed thereunder having the force of statute.
Agricultural Development Bank of Pakistan and 2 others v. Muhammad Sharif 1988 SCMR 597; Abdul Karim v. West Pakistan Province PLD 1956 SC' 298; Water and Power Development Authority v. Muhammad Ali 1987 SCMR 261; Karachi Development Authority and another v. Wali Muhammad Khan and others 1991 SCMR 2434; Dr. Abdul Hafeez v. Chairman, Municipal Corporation, Lahore and others PLD 1967 L.A. 1251; Muhammad Salimullah v. Trustees of the Port of Karachi PLD 1975 Kar. 758; R.T.H. Janjua v. National Shipping Corporation PLD 1974 SC 146; The Lahore Central Cooperative Bank Ltd. v. Pir Saifullah Shah PLD 1959 SC (Pak.) 210; Salahuddin v. Frontier Sugar Mills and Distillary PLD 1975 SC 244; Chairman, East Pakistan Development Corporation v. Rustam Ali PLD 1966 SC 848; Shahid Khalil v. Pakistan International Airlines Corporation, Karachi 1971 SCMR 568; Muhammad Aslam v. National Shipping Corporation PLD 1979 Kar. 246; Evacuee Trust Property Board v. Muhammad Nawaz 1983 SCMR 1275; Principal, Cadet College, Kohat v. Muhammad Shoab Qureshi PLD 1984 SC 170; Anwar Hussain v. Agricultural Development Bank of Pakistan PLD 1984 SC 194; WAPDA v. Muhammad Arshad Qureshi 1986 SCMR 18 and Anwar Hussain v. Agricultural Development Bank of Pakistan 1992 SCMR 1112 rel.
(c) Civil service‑‑‑
‑‑‑‑Mala fides‑‑‑Question of mala fides is to be decided with reference to facts and circumstances of each case‑‑‑Where allegations about an employee's misconduct existed in the office noting, but orders terminating his service did not contain any charge or stigma against him, such action would not ipso facto lead to conclusion that his services were terminated by way of penalty or termination of service was tainted with mala fides.
The Secretary East Pakistan Industrial Development Corporation, Dacca v. M.D. Sirajul Haque 1970 SCMR 398 : Abdul Karim v. West Pakistan Province PLD1956 SC (Pak) 298; Noorul Hassan and others v. The Federation of Pakistan PLD 1956 Sc (Pak.) 331 and Water and Power Development Authority v. Muhammad Ali 1987 SCMR 261 rel. (d) Civil service‑‑‑
‑‑‑‑ Mala fides‑‑‑Termination of service of employee on the basis of finding recorded by Ombudsman and enquiry report prepared by Director Vigilance to which petitioner was not party and he was never associated with those proceedings at any stage‑‑‑Validity‑‑‑Ombudsman's Secretariat, at whose instance impugned action was taken, had recommended to Authority to reconsider the termination of employee as the same was considered to be harsh, having regard to the circumstances of the case but Authority never reconsidered its earlier decision which was wholly unwarranted‑‑‑Authority's decision in terminating employee's service could not be deemed to be bona fide in circumstances.
(e) Mala fides‑‑‑
‑‑‑‑Proof‑‑‑To establish a case of mala fides some specific allegation would be necessary which must be supported by some prima facie proof to justify the Court, to call upon the other side to produce evidence in its possession, for presumption of regularity was attached with regard to all official acts, and unless that presumption was rebutted, impugned action could not be challenged merely upon a vague allegation of mala fides‑‑‑Allegations of mala fides having been pleaded with particularity alongwith affidavit, such allegations were neither denied by Authority nor counter‑affidavit was filed to controvert the allegations‑‑‑Plea of mala fides was established in circumstances.
Federation of Pakistan v. Saeed Ahmad Khan PLD 1974 SC 151; Government of West Pakistan v. Begum Agha Abdul Karim Shorish Kashmiri PLD 1969 SC 14; Abdul Baqi Baluch v. Government of Pakistan PLD 1968 SC 323 and Lt.‑Col. Farzand Ali v. Province of West Pakistan PLD 1970 SC 98 ref.
(f) Agricultural Development Bank (Staff) Service Regulations, 1961‑‑‑
‑‑‑‑Regln. 13‑‑‑Termination simpliciter of employee in accordance with terms and conditions of his service‑‑‑Legality of termination would not turn on whether employer had heard employee before terminating him‑‑‑Where an office was held during pleasure and not governed by any statutory rules regulating employment of service, person having the power of removal need not give any reasons.
(g) Agricultural Development Bank of Pakistan Officers (Efficiency and Discipline) Rules, 1975‑‑‑
‑‑‑‑Regln. 5(a)‑‑‑Action proposed to be taken against employee‑‑‑Employee would be entitled to know the grounds of the proposed action and reasonable opportunity to show cause against that action‑‑‑Where such procedure was not followed, impugned action against employee was not bona fide.
Ali Sibtain Fazli for Petitioner. Raja Muhammad Akram for Respondents Nos. 1 and 2. Aftab Iqbal Chaudhry, Dy. A.‑G. for Pakistan.
Dates of hearing: 4th and 5th April, 1993.
JUDGMENT
This petition under Article 9 of the Provisional Constitution Order, 1981, seeks a declaration that the Office Memorandum bearing No. P.(E&D)‑(II)/15(2)84/1739, dated 6‑6‑1984, terminating the services of Mr. Akhtar Hussain Chowdhry, Deputy Director, Officer on Special Duty, Regional Manager's Office, ASBP, Faisalabad, under Regulation 13(1) of the Agricultural Development Bank (Staff) Services Regulations, 1971, on payment of three months substantive pay in lieu of notice, without assigning reason, is without lawful authority.
2. The facts leading to this writ petition are that petitioner, Akhtar Hussain Chowdhry, was appointed on 8‑9‑1974 as a Junior Officer‑I with Agricultural Development Bank of Pakistan, respondent No. 1 (hereinafter to be referred to as the Bank). The terms and conditions of his employment are recorded in Appointment Offer No. Admn.l/8(143)VI/2046, dated 8‑5‑1974. Clause 7 of the letter of appointment stipulates as under:‑‑
"You will be governed by the Rules, Regulations and Orders of ADBP in force and as amended from time to time in all matters in respect of your service not specially mentioned in the memorandum. The rule, regulations and orders of the Bank shall prevail if there is any conflict between the conditions laid down in this office memorandum and the Rules and Regulations."
It is submitted that the petitioner became Manager/Deputy Director of the Bank at Jhang. In December, 1983, one Muhammad Dilmeer Khan and three others jointly applied for loan which was sanctioned by the Bank for Rs.84,000 on 21‑12‑1983. It is alleged that Muhammad Dilmeer Khan, one of the co- applicants for loan, lodged a complaint with the learned Wafaqi Mohtasib alleging demand of bribe by the petitioner for disbursement of loan. It was also alleged that the sanction was withdrawn on the assumption that Atta Muhammad, a co‑applicant for loan, was minor and the Bank was guilty of mal administration in not accepting the date of birth on the National Identity Card, the certificate issued by the Medical Superintendent, District Headquarters Hospital, Rang and the birth certificate issued by the Union Council. The learned Wafaqi Mohstasib disposed of the complaint on 16‑5‑1984, with the following findings:‑‑
(a) The ADBP should explain the uncivilised and unwarranted act of taking off the clothes of Mr. Muhammad Atta for ascertaining his having attained the age of majority. The action was against the accepted norms of civilised behaviour and becomes more glaring because it was taken after submission of (i) National Identity Card which showed 1964 as his date of birth, (ii) Birth Certificate from the Union Council showing .11‑2‑1965 as the date of birth and (iii) Age Certificate from the Medical Superintendent, District Headquarters Hospital, Jhang, confirming his date of birth of 11‑2‑1965, after examining him. The Agency should also explain as to why compensation be not awarded to Mr. Muhammad Atta for the humiliation and the indignity suffered by him on account of perverse act of the Manager, ADBP, Jhang.
(b) The complainants be disbursed the loan as already sanctioned by the ADBP on 21‑12‑1983.
Action taken on my findings be reported by the target date on 15‑6‑1984".
3. Pursuant to the findings of the learned Wafaqi Mohtasib, the Chairman of the Bank, respondent No. 2, directed the Director (Vigilance) of the Bank to submit report vide Office Note dated 24‑5‑1984. In consequence, the Director (Vigilance) visited Jhang on 27‑5‑1984 and after hearing the applicants for loan, recording their statements and perusing the record, held that the loan case had been carelessly handled. The following observations by the Director (Vigilance) in his report dated 31‑5‑1984 may be reproduced with advantage:‑‑
"The applicants argued that Mr. Muhammad Atta did look like a minor due to inherent birth defects but he is major by all means and they could satisfy the Manager about it. The Manager, however, did not agree and he got his shirt put off and inspected his armpits which had no hair. The Manager pronounced his judgment that the boy is minor and he closed the loan case. It has however been established beyond doubt that the Manager or any other Bank functionary never got removed other clothes of the applicant. His shirt was only removed and armpits were examined. .
The complainant did not stress or produce any evidence in respect c demand of illegal gratification of Rs.2,000 from him. Although he did not give in writing but he confessed before me that the Manager himself did no demand any money from him. Being annoyed with the behaviour of the Manager, as in spite of all proofs of majority of Mr. Muhammad Atta he did not release the sanctioned loan he inferred that he needs money for doing our work.
Thus, it is clear that no inhuman treatment has been meted out to the applicants nor money has been demanded from them but nevertheless they have been put to unnecessary trouble and botheration by the irresponsible behaviour of the Manager.
It is, therefore, proposed that Mr. Akhtar Hussain Chowdhry may be proceeded against under ADBP Officers Service (E&D) Regulations, 1975 for efficiency as under:‑‑
(i) He closed the sanctioned case on 28‑12‑1983 in a hurry and without satisfying himself about the majority of the disputed applicant Mr. Muhammad Atta with reference to other documentary evidence available with Union Council/DHO etc.
(ii) Even after closure of the case he kept the applicants running from one office to another for producing documentary evidence of majority of Mr. Muhammad Atta, without authority.
(iii) He also referred the same issue to the Regional Manager and LA. Faisalabad although he had formally closed the loan case.
(iv) He sanctioned fresh loan case No. 075675 to the same applicants excluding the so‑called minor on 2‑5‑1984 and paid a loan of Rs.99,475 the same day on the charge already created on the land of the applicants on 24‑12‑1983 including the so‑called minor applicant.
(v) On account of his mishandling of the loan case, the applicants have been put to inconvenience, unnecessary expenditure and harassment and Bank's image has been tarnished.
I may also add that it will be in fitness of things that pending formal enquiry into the charges Mr. Akhtar Hussain Chowdhry may be withdrawn from field duty as Manager and posted as OSD in Regional Office, Faisalabad."
4. The report of the Director (Vigilance) was placed by the Executive Director (Operation Division) before respondent No. 2 vide note dated 3‑5‑1984 which reads thus:‑‑
"Reference Chairman's note dated 24‑5‑1984, Director (Vigilance) visited Jhang on 27‑5‑1984. His report is placed below. Its perusal shows that Manager did show highhandedness towards the borrowers and exceeded the limit of modesty.
(2) In the meanwhile fresh loan application from 3 applicants after excluding the name of Mr. Muhammad Atta was entertained on 30‑4‑1984 and loan for tractor disbursed on 2‑5‑1984. The party as such is satisfied.
(3) In view of the earlier misconduct, he has been removed from the branch and posted at Faisalabad in Regional Office. R.M. (Faisalabad) passed these orders on 30‑5‑1984 under my directions.
(4) Disciplinary action is being initiated for the misconduct and other irregularities pointed out by Director (Vigilance) in the concluding para of his report.
(5) We may apprise Wafaqi Mohtasib of the above position."
5. Respondent No. 2 made the following remarks on the said note on 2‑6‑1984:‑‑
"(1) Seen.
(2) I very strongly feel that it is necessary now to make some cases as examples so that the staff may get the message that the management can act forcefully in the event of cases of corruption and/or highhandedness and rudeness with clients.
(3) I would therefore very much like to terminate the services of this officer under section 13(1).
(4) Before we do so, however, I think it is necessary to get a clearance from Ombudsman's Office so that there is no misunderstanding with them whatsoever.
(5) Therefore, Director (E&D) may please personally call on the relevant official in Ombudsman's office, explain the position and get their clearance so that we may go ahead with termination orders."
6. Respondent No. 2 informed the Wafaqi Mohtasib vide Letter No. C&1/FSD‑5(421)/84, dated 12‑6‑1984 that the services of the petitioner have been terminated. However, the Wafaqi Mohtasib's Secretariat, vide D.O. No. REG.II/3522/84, dated 18‑7‑1984, recommended the respondent to reconsider the decision in the light of the appropriateness of the punishment with the following observations:‑‑
"It is obvious that the Bank justified the action of the Manager ADBP Jhang. Moreover, the tenor of thought as given in your Letter No.C&I/FSD‑5(42)/84, dated the 12th June, 1984 does not seem to occasion the extreme punishment of termination of service of Mr. Akhtar Hussain Chaudhry. You may like to kindly reconsider the decision in light of the appropriateness of punishment."
Respondent No. 1 gave the following remarks on the said D.O. letter which read thus:‑‑ "Seen. No action required ..............
(Sd.) Chairman, 25‑7‑1984."
7. Mr. Ali Sibtain Fazli, learned counsel for the petitioner, argued that Regulation 13(1) of the Staff Service Regulations, 1961, has wrongly been applied to the case of the petitioner, in that, it has been removed from the statute book by an amendment to the Agricultural Development Bank Ordinance (IV of 1961) on February 6, 1973, by virtue of the Agricultural Development Bank (Amendment) Act (XII of 1973). In this amended Act section 39 of the Ordinance No. IV of 1961 was amended and a proviso was added to the effect that no regulation made with respect to the matters mentioned in clauses (e) and (f) pertaining to amongst other things disciplinary and service matters of the Bank shall take effect until it has been approved by the Federal Government. It was argued that on the basis of the aforesaid amended provision, the Bank made Regulations called the Agricultural Development Bank of Pakistan Officers Service (Efficiency and Discipline) Regulations, 1975 and got the same approved by the Federal Government and, therefore, these regulations alone regulate the service of all the officers of the Bank. As regards Service Regulations of 1961 (supra), it was argued that the Federal Government never accorded any approval to the said regulations and; therefore, the same were non‑existent in the eye of law and the impugned order of termination passed thereunder is of no legal validity.
8. In order to appreciate the aforesaid submissions it would be advantageous to reproduce the provisions of Regulation No. 13 of the Agricultural Development Bank (Staff) Service Regulations, 1961 and the provisions of sections 30 and 39 of the Agricultural Development Bank Ordinance, 1961, Regulation 13 reads as under:‑‑
"13. Termination of service.‑‑‑(1) The Bank may dispense with the services of an employee other than an employee on probation or a temporary employee, by giving 3 months' previous‑ notice in writing or 3 months of 30 days' substantive pay in lieu thereof, to an employee in Class I or Class II and one month of 30 days' previous notice or 30 days' substantive pay in lieu thereof to an employee in Class III and Class IV. In the case of a temporary employee of any class, such notice or pay in lieu shall be for a period of one month of 30 days. The power to terminate the service of an employee shall be exercised by the competent authority. Such termination of service of any employee is in the absolute discretion of the Bank and it shall not be necessary to assign any reason for the termination and the employee shall not be entitled to any form of compensation for termination of service.
(2) The Bank reserves the right of dismissing an employee without any notice if he is found guilty of misconduct, breach of trust or neglect of duty.
(3) Nothing in sub‑regulation (1) shall effect the right of the Bank to make an employee retire or to dismiss an employee without giving notice or pay in lieu thereof in accordance with the provisions of sub‑regulation (4) and regulation 95 or its right to determine the service of an employee without notice or pay in lieu thereof on his being certified by the authorised medical attendant to be permanently incapacitated for further continuous service in the bank.
But an employee whose service is determined on his being so certified may ask for medical examination by a Board of Doctors constituted by the Chairman and by the General Manager, East Pakistan in case of employees in East Pakistan:
Provided that an employee who is made to retire or is dismissed or whose service is terminated under this regulation shall have the right of making an application for review, to the competent authority.
(4) An employee in the service of the Bank shall retire from service‑‑
(a) on such date after he has completed twenty‑five years of service as the competent authority may in the interest of the Bank, direct;
(b) if he has completed before, or completes within a period of six months from the date of publication of sub‑regulation (4) in the Gazette of Pakistan, the fifty‑fifth year of his age, on such date after such completion, being a date within the said period, as the Competent Authority may direct or in the absence of such direction, on the expiry of the said period or on the completion of the sixtieth year of his age, whichever be earlier;
or
(c) in any other case, on the completion of the fifty‑fifth year of his age.
(5) Notwithstanding anything contained in clause (b) or clause (c) of sub- regulation (4) the competent authority may extend the service of an employee beyond, or re‑employ an employee after, the date of his retirement for such period and on such terms and conditions as it may deem fit:
Provided that the service of an employee which has been extended or of an employee who has been rd‑employed, shall to liable to termination at not less than three months' notice on either side or upon payment of three months' salary in lieu thereof; and such termination shall not be deemed to be removal or dismissal.
(6) ....................................................................... ...................
(7) ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...
9. The provisions of sections 30 and 39 of the Ordinance, as amended in 1973, are as follows:‑‑
"30. Appointment of officers and advisors.‑‑‑The Bank may appoint or employ such persons including advisors as it considers necessary for the efficient performance of its operation on such terms and conditions as may be prescribed by regulations.
39. Regulations.‑‑‑(1) The Board may make regulations not inconsistent with this Ordinance or the rules to provide for all matters for which provision is necessary or expedient for the purpose of giving effect to the provisions of this Ordinance and the efficient conduct of the affairs of the Bank.
(2) Without prejudice to the generality of the provisions of subsection (1), the regulations may provide for:‑‑
(a) ......................................................
(b) ......................................................
(c) ......................................................
(d)......................................................
(e) the recruitment of the employees of the Bank, the terms and conditions of their service, the constitution and management of Group Provident Funds for the employees of the Bank and all other matters connected with any of these things;
(f) the duties and conduct of employees and agents;
(g) ....................................................
(h) .......................................................
Provided that no regulation made with respect to the matters mentioned in clauses (e) and (f) shall take effect until it has been approved by the Federal Government:
10. The effect of insertion of the proviso to subsection (2) of section 39 of Ordinance was considered in the case of Anwar Hussain v. The Agricultural Development Bank of Pakistan and others (1992 SCMR 1112). It was held:‑‑
"Regulations relating to terms and conditions of service of the employees including the termination, were subjected to the approval of the Federal Government. Therefore, if the proviso was attracted the contracting parties were not free in the matter of contract of service and the rule laid down excluding the principle of master and servant, because of the statutory rule placing fetters upon the freedom of parties, would coming into operation:'
It was further held:
"After coming into force the Amendment Act (XII of 1973) on 6th February, 1973, with the approval of the Federal Government Regulations relating to the Efficiency and Discipline of employees were made which are called the A.D.B.P. Officers (Efficiency and Discipline) Regulations, 1975 which are more or less on the same pattern as the Efficiency and Discipline Rules governing the civil servants. These Regulations repealed Regulation 95 in Chapter VI of the Service Regulations of 1961" (the latter Regulation No. 95 related to Efficiency and Discipline of employees). (The words in the parenthesis are mine).
It was further observed:‑‑
"The proviso to subsection (2) of section 39 of the Ordinance as appended by means of amendment of the law in 1973 plainly stipulates that the Regulation made under clauses (e) and (f) of the said subsection can come into force only upon and from the date of the approval accorded by the Federal Government. Therefore, such Regulations will be inoperative or ineffective until the condition laid down, namely, the approval of the Federal Government, is fulfilled."
11. A question was raised whether the amendment made in 1973 by its own force renders the Service Regulations of 1961 which were already in effect and which fell within the purview of clause (e), inoperative from the date when the amendment came into force on 6th February,1973. It was held:‑‑
"It will be difficult to construe the provisions of the proviso to destroy the Regulations which had already come into force prior to the amendment,…
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