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Petitioner: HUMAYUN KHAN VS Respondent: MESSRS GHEE CORPORATION OF PAKISTAN LTD. AND 2 JUDGMENT
Court Name: Lahore High Court Judge(s): Ghazanfar Ali Gondal Title:HUMAYUN KHAN vs MESSRS GHEE CORPORATION OF PAKISTAN LTD. AND 2
JUDGMENT
Reported As: PLD 1984 Lahore 35 Result: Appeal accepted Judgment JUDGMENT ' By means of this writ petition, petitioner Humayun Khan seeks a declaration that the order, dated 9-6-1982 passed by respondent Ghee Corporation of Pakistan Limited, transfering him from Fazal Vegetable Ghee Mills Limited, Islamabad, and posting him as 0. S. D. In its Oil Procurement Wing at its Headquarter Office at Lahore with immediate effect is illegal, void and without jurisdiction. 2. The facts of the case as appear from pleadings of the parties and documents placed on record are that petitioner Hamayun Khan was appointed as Commercial Officer with effect from 1-9-1974 in Punjab Industrial Development Board constituted under Punjab Industrial Development Board Act, 1973 (XXIII of 1973) and was petted at Sergroh Vegetable Ghee Mills, Lyallpur. He joined service on 2-9-1974 and continued to work therein as Commercial Officer. In the meantime, Hydrogenated Oil Industry (Control and Development) Act 1973 (LXV of 1973) had been promulgated and put in force, with effect from 2-9-1973. Necessary poisons of such sections of the said statute as are relevant for the purposes of this case are given below :- 2. Definitions.-In this Act, unless there is anything repugnant in the subject or context,- (c) "corporation" means a corporation wholly owned by Government to which an establishment is transferred under section 13 ; (f) "establishment" means any company, firm, concern, institution or enterprise the whole or any part of the undertaking of which pertains to the industry and includes any related office, shop, factory, godown, yard, stocks and stores wherever that may be ; (g) "industry" means the hydrogenated vegetable oil industry ;
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(h) "Managing Director in relation to an establishment" means the Managing Director appointed under section 6 in respect of such establishment; and (i) "managed establishment" means an establishment in respect of which a Managing. Director has been appointed. 3. Declaration.-It is hereby declared that the industry shall be carried on and owned by the Federal Government or a Provincial Government or by a corporation controlled by any such Government, to the exclusion of all other persons, except a foreign investor. 4. Act to override other laws.-The provisions of this Act shall have effect notwithstanding anything contained in the Companies Act, 1913 (VII of 1913), or the Companies (Managing Agency and Election of Directors) Order, 1972 (P. 0. No. 2 of 1972), or any other law for the time being in force or in any agreement, contract, memorandum or articles of association of a company. 5. Power to take over management or acquire shares of business of an establishment.-(1) The Federal Government may, by aft order,- (a) take over the management of any establishment and, as from the date of such order, the previous management shall stand divested of such management ; (h)in the case of an establishment which is a company or an establishment owned by a company- (i) acquire the whole or a portion of the shares from all or any of the shareholders of such company and, as from the date of such order, the shares so acquired shall vest in the Federal Government ; or (ii) acquire the whole or a portion of the propriety interests of such company in such establishment and, as from the date of such order, the interests so acquired shall vest in the Federal Government ; and (c) in the case of an establishment owned by a person acquire the whole or a portion of the proprietary interests of such person, and as from the date of the order the interests so acquired shall vest in the Federal Government. 6. Appointment of Managing Directors.-(1) Where the Federal Government has made an order under section 5 in respect of an establishment it may appoint a Managing Director in respect of such establishment. (2) Upon the appointment of Managing Director in respect of an establishment, the administration and management of the affairs of the establishment shall vest in he Managing Director and any company or person or authority exercising or having the right to exercise, immediately before such appointment, any power or functions in relation to the establishment shall cease to exercise or to have the right to exercise such power or function. 13. Delegation of powers, etc.-(3) Where the Federal Government has taken over the management of an establishment under section 5, it may transfer the management of the establishment to a corporation wholly owned or controlled by Government or a corporation set up for the purpose, on such terms and conditions as the Federal Government may specify. (4) Where the Federal Government has acquired the shares or proprietary interests of an establishment under section 5, it may transfer the shares or proprietary interests to a corporation wholly owned or controlled by Government or a corporation set up for the purpose, on such terms and conditions as the Federal Government may specify. 16. Continuation in service.-In the case of a managed establishment, all persons employed in, by or for the purposes of the business of the establishment by whomsoever appointed or engaged, shall continue in their respective employments on the same remuneration and other conditions of service as were applicable to them immediately before the appointment of the Managing Director in respect of that establishment, unless the Managing Director directs otherwise in a particular
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case or their terms and conditions of service are altered in accordance with the law or any rules applicable to such establishment. 22. Continuance in service of employee on transfer to a corporation.- (1) Where the management of a managed establishment is transferred to a corporation under section 13, every wholetime employee of the establishment who was employed by the establishment immediately before the date of such transfer shall, on and from the date of such transfer, become an employee of the corporation and shall hold his office therein on the same terms and conditions, including remuneration, tenure of office, rights applicable to him immediately before the date of transfer, until his employment in the corporation is terminated or his terms and conditions of service are altered by the corporation. 3. It appears that the Federal Government made an order under section 5 of the said Act taking over the management of the Sergroh Vegetable Ghee Mills Limited, Lyallpur and Fazal Vegetable Ghee Mills Ltd., Islamabad and thus divested the Punjab Vegetable Ghee Board of the management of the said establishment. ' Further, in exercise of the powers vesting in the Federal Government under section 13(3), Notification No. VGI-3(5) 76, dated 11-1-1977 had been issued by the said Government transferring the management of the establishments manufacturing Ghee including Sergroh Vegetable Ghee Mills Limited, Lyallpur and Fazal Vegetable Ghee Mills Ltd., Islamabad to Ghee Corporation of Pakistan Limited with effect from 1-6-1976. From the said date respondent Ghee Corporation of Pakistan began to control and manage the different units of Ghee Industry. It also appears that as a result of operation of said statute and said notification, petitioner now became an employee of respondent Ghee Corporation of Pakistan Limited. The said Corporation by its order dated 26-6- 1976 transferred the petitioner from Sergroh Vegetable Ghee Mills Limited, Lyallpur to Fazal Vegetable Ghee Mills Limited, Islamabad under its control with immediate effect. Petitioner, accordingly, took over the charge as Commercial Officer in Fazal Vegetable Ghee Mills Limited and kept on working there in that capacity. On 15th of March, 1979, said Act LXV of 1973 was amended by Hydrogenated Vegetable Oil Industry (Control and Development) (Amendment) Ordinance, 1979 (Ordinance XVII of 1979) which inserted section 6-A in the said Act. The said section is given below in extenso for the sake of easy reference :- "6-A. Constitution of Board of Directors etc.-(1) Where the Federal Government has acquired under section 5 the whole or a majority portion of the shares of a managed establishment which is a company and is of the opinion that, in the interest of shareholders of the managed establishment, it is necessary to do so, the Federal Government may, by order n writing, direct that a board of directors consisting of a Managing Director and such number of other directors as may be specified in the order be constituted in such managed establishment. (2) Where the Federal Government had made an order under subsection (1) in respect of a managed establishment, the board of directors of such establishment shall be constituted within a period of sixty days from the date of the order. (3) Where the Federal Government has made an order under subsection in respect of a managed establishment,- (a) the Federal Government may nominate such number of directors including the Managing Director, on the board of directors of the managed establishment as bears to the total number of directors, as nearly as may be, the same proportion as the aggregate face value of the shares owned by the Federal Government and by an institution owned or controlled by the Federal Government, including the Corporation referred to in subsection (3) of section 13, hereafter in this section referred to as the Corporation, bears to the total issued share capital of the managed establishment ; and
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(b) the other directors shall from time to time be elected by the members of the managed establishment, other than the Federal Government an institution referred to in paragraph (a) and the Corporation, in general meeting in accordance with the Companies (Managing Agency and Election of Directors) Order 1972 (P. 0. No. 2 of 1972). (4) The Managing Director nominated under subsection (3) shall be the Chief executive of the managed establishment. (5) The board of directors of a managed establishment constituted under this section shall enter upon office on such date as the Federal Government may, by order in writing, appoint in this behalf and, upon their entering upon office as aforesaid,- (a) the Managing Director appointed under subsection (1) of section 6 in respect of the establishment shall cease to hold office; (b) the management of the establishment shall cease to vest in the Corporation, and the management and administration of affairs of the establishment shall, subject to this section, stand transferred to the board of directors ; and (c) the Managing Director nominated under subsection (3) shall have such powers and functions as the board of directors may, from time to time, confer upon or entrust to him. 5. It appears that in exercise of powers vested in the Federal Government under subsection (1) of said section 6-A, an order in writing was made by the Federal Government, directing that the board of directors be constituted in Fazal Vegetable Ghee Mills, Islamabad consequent upon taking over by Government of the management of the Fazal Vegetable Ghee Mills, Islamabad and acquisition by it of whole or major portion of its shares/proprietary interest under section 5 of the said Act. The date of this order has not been furnished by the parties. On 28-5-1979, an order was passed by the Federal Government 'under subsection (3) and subsection (5) of said section 6-A nominating the board of directors of Fazal Vegetable Ghee Mills, Islamabad, and directing them to enter upon their office on 28-5-1979. The said board of directors accordingly entered upon their office on 28-5-1979, upon which, the Management of the. Fazal Vegetable Ghee Mills Ltd., ceased to vest in the respondent Ghee Corporation of Pakistan Limited and the Management and administration of affairs of the said Company stood transferred to the said board of directors. On 11-10-1980 the board of directors of Fazal Vegetable Ghee Mills approved up-grading of Officer cadre in its meeting held on 11-10-1980 and up-graded the post of the Commercial Officer-Dy. Manager to Commercial Manager-Manager w. e. f. 12-10-1980. Petitioner thus stood promoted by the said ward of directors as Commercial Manager w. e. f. 12-10-1980. However, on 4-4-1982 there was a review by the board of directors of the organizational set up of the Company (Fazal Vegetable Ghee Mills Ltd.) and in view of financial posiiion of the Company, a reslution was passed down-grading the post of the Commercial Manager from Manager-I to Manager-II, after adjustment of the petitioner Hamayun Khan by respondent Ghee Corporation of Pakistan. On 31-5-1982 board of directors addressed a letter to respondent Ghee Corporation of Pakistan requesting that necessary adjustments of Hamayun Khan as Manager Commercial (Manager-I) at the Head Office be made and Manager II grade be provided for Fazal Ghee Mills Ltd; Islamabad. On 9-6-1982 respondent Ghee Corporation of Pakistan issued the impugned office Order No. GCP/ 1108-40 stating that consequent upon down-grading of posts of Manager-1, Commercial, in Fazal Vegetable Ghee Mills, Islamabad to Manager-II, Ghee Corporation of Pakistan Management has decided to create post of 0. S. D. In M. I. Status in its Oil Procurement Wing at Lahore and on creation of aforesaid post with the. Consent of the Fazal Vegetable Ghee Mills, Islamabad, Mr. Hamayun Khan M-I (Commercial) is transferred and posted as 0. S. D. In its Oil Procurement Wing at Lahore with immediate effect. 6. The challenge to the said transfer order is based on the plea of total incompetency of respondent Ghee Corporation of Pakistan Ltd. To transfer the petitioner at all anywhere after the
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management of Fazal Vegetable Ghee Mills had ceased to vest in Ghee Corporation of Pakistan and had been transferred to board of directors of said Company. 7. The learned counsel for the respondents have raised two preliminary objections to the maintainability of this writ petition. The first of these is that office of Commercial Manager held by the petitioner was not a public office and that the service of the petitioner was contractual in nature and was regulated by Law of Master and Servant and, therefore, the writ petition against the transfer of the petitioner was not competent and the only remedy available to him was one of seeking damages in case he can prove any injury to his rights. For this preposition they have relied upon R. T. H. Janjua v. National .Shipping Corporation (1). I have heard the learned counsel for the petitioner also on this preliminary objection. He has submitted that simple question involved in this case is whether an order passed by an incompetent authority can be struck down under Article 9 of the Provisional Constitution Order or not and to enable this Court to decide such a question it is not necessary that the applicant before it for such a relief should be holder of a public office. He has also submitted that service of the petitioner is not contractual in nature and in any way, it is regulated by rules made in that behalf and, therefore, even if petitioner (1) PLD 1974 SC 146 is an employee of the Ghee Corporation or Fazal Vegetable Ghee Mills Ltd., law of Master and Servant does not apply to him and, therefore, this writ petition for quashment of the order of his transfer passed by an incompetent authority is maintainable. He has relied upon case of the Evacuee Trust Property Board and another v. Muhammud Nawaz (1), in support of his later argument 8. I have given my anxious thought to opposing contentions of learned counsel for parties. I think, I need not go into the question whether the service of petitioner is contractual in nature and is regulated. By Law of Master and Servant and whether petitioner holds a public office as defined in R. T. H. Janjua's case, as in my opinion the said questions are irrelevant in this case and the said preliminary objection can be disposed of on other considerations. R. T. H. Janjua' case and the cases cited therein are all cases of arbitrary removal or dismissal from service of a statutory corporation and relief claimed therein was expressly or impliedly for grant of mandamus or an order in the nature of a mandamus for restoration to the office, of which an incumbent had been deprived arbitrarily or illegally. The rule relied upon in these judgments that it is not possible to extend scope of mandamus to restoration to office in private corporations is obviously confined to relief of mandamus alone and has nothing to do with. The relief of certiorari for quashment of an incompetent order of a corporation. The present case is not a case for grant of an order in the nature of mandamus for restoration to office either expressly or even by implication as the post held by the petitioner has been down-graded and is no more available for being occupied by him in case order of his transfer is held to be without lawful authority. The present writ petition is one for grant of an order in the nature of certiorari for quashment of an order of transfer passed by Ghee Corporation of Pakistan Ltd., which allegedly was incompetent to pass the said order. The only condition laid down in Article 9(1)(aXii) of the Provisional Constitution Order for claiming such a relief is that the person claiming said relief should be an aggrieved person. The petitioner is clearly aggrieved of the order of transfer passed against him and he could, therefore, approach High Court under the said article like an ordinary citizen of the country and is not hedged in by the condition of his being a holder of public office for grant to him of the relief of quashment of an order of his transfer. Further, this writ petition not being directed against order of removal or dismissal of petitioner from service of statutory corporation, there is no question involved in it of forcing on an unwilling master, a servant whom he does not want to keep. It is, on the other hand, directed against the order of transfer passed by a statutory corporation which is alleged to have no authority to do so. In my opinion the plea in this case is that petitioner is not now a servant of
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respondent Ghee Corporation of Pakistan and said Ghee Corporation of Pakistan is not his master and as such had no authority to transfer him. Therefore, obviously the doctrine of Master and Servant is inapplicable to it. Furthermore, the main point of attack to validity of transfer order in this writ petition is the incompetency of the Ghee Corporation of Pakistan to deal with service affairs of the petitioner aft r transfer of management and administration of affairs of the Fazal Vegetable Ghee Mills Ltd., from Ghee Corporation of Pakistan to board of directors of said Mills. In Akbar Ali Bokhari v. State Bank of Pakistan etc. (2), it was held that dictum of their Lordships (1) NLR 1980 Service 154 PLD 1977 Lab. 234 of the Supreme Court in R. T. H. Janjua's case enunciates only general principle but does not state that there can be no exception to the same and that in a service case of exceptional nature in which there is an inherent vice or inherent lack of jurisdiction or for that matter lack of authority on the part of the Corporation) to act or make an order in the matter, relief can be granted to a suitor who approaches the High Court for declaration or invalidity of impugned order, irrespective of the fact that his office was not a public office as defined in R. T. H. Janjua's case and was governed by Law of Master and Servant. In this case reliance was placed by the High Court on Maqbool Elahi and others v. Abdur Rehman Khan etc. (1). In that case, their Lordships of the Supreme Court had held that office of a Secretary in a company for performance of secretarial duties was not a public office yet they granted relief to the incumbent of that post and declared the order of his suspension passed by directors who had illegally been co-opted after wrongfully ousting the rightful directors to be of no effect in law on the ground that the three new Directors had no legal right to suspend him. As commented by another learned Bench of the Lahore High Court in Ijlas Ahmad Siddiqi v. The Municipal Committee, Multan etc. (2), in the said Supreme Court case the order suspending the Secretary from service plainly suffered from inherent vice having been made by Directors who assumed their Office illegally and were incompetent to make the order. This decision of their Lordships of the Supreme Court clinches the matter. In the case in hand, the order of transfer is alleged to have been passed by an authority not competent to do so' and, therefore, this writ petition is maintainable irrespective of the circumstance that the service of the petitioner is contractual in nature and is regulated by Law of Master and Servant. This preliminary objection has, therefore, no merit and is accordingly overruled. 9, The next preliminary objection raised by learned counsel for the respondents is that there is no post of Commercial Manager available in Fazal Vegetable Ghee Mills Limited now and, therefore, the writ petition filed by the petitioner is ab initio infructuous and as such should. Be dismissed straightaway. For this he has relied upon case of Pakistan v. Khondkar Ali Afzal and another (3). I have heard the learned counsel for the petitioner also in reply to this preliminary objection. In the authority cited by the learned counsel for the respondent the post in dispute was of Joint Secretary to the National Assembly and petition vas for grant of writ of mandamus requiring the Government of Pakistan to let the holder of that post to continue in office as Joint Secretary, National Assembly for a further period of two years. As already stated, the present case is not for grant of an order in the nature of a mandamus for restoration to the office but for declaration of incompetency or lack' of authority on the part of respondent, Ghee Corporation of Pakistin to pass order of transfer'of petitioner: That relief was claimable and was the only relief actually claimed against respondent Ghee Corporation of Pakistan. Furthermore, in the cited case, the post of Joint Secretary in National Assembly had been abolished .And on that account the writ petition was held to have 'become infructuous. In the present case, however, the post has not been abolished but has only been down-graded and if the order of transfer' by Ghee Corporation of Pakistan is held to be one without lawful authority, the board of directors of Fazal Vegetable (1) PLD 1960 SC 266 (2) PLD 1967 Lab. 408 (3) PLD 1.960 SC 1
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Ghee Mills Limited can offer the petitioner the down-graded post with all the consequences of decreased status, pay and emoluments or transfer him with the same status to any of or project of the Company as allowed by rule III(g) (1) of service rules framed by the board of directors of Fazal Vegetable Ghee Mills Limited, on 5-4-1980 if a job of Manager-I is available with them in any such office or Project of the Company or deal with him in any other way available to them under the law and terms and conditions of service of petitioner read with their own service rules. I am, therefore, of the opinion that in the special circumstances of this case, this writ petition is not infructuous on the mere ground of non-availability of a post equivalent to the present status of the petitioner in the Fazal Vegetable Ghee Mills Ltd; Islamabad, not does the said circumstances restrain me from issuing the declaration prayed for in this case. I, therefore, overrule the said preliminary objection also. 10. After having disposed of the preliminary objections raised by learned counsel for the respondents, ground is now clear for me to attend to the crucial point convased by the learned counsel for the petitioner in this writ petition. Contention of the learned counsel for the petitioner in this case is that board of directors constituted by the Federal Government having entered upon office in Fazal Vegetable Ghee Mills, Islamabad, on 28-5-1979, the management of the establishment known as Fazal Vegetable Ghee Mills Ltd. ; Islamabad had by virtue of section 6-A (5) (b) of Act LXV of 1973 ceased to vest in Ghee Corporation of Pakistan and its management and administration of its affairs had been transferred to the board of directors of said Mills and, therefore, the Ghee Corporation of Pakistan had no authority on 12-10-1980 to transfer the petitioner from Fazal Vegetable Ghee Mills to its office at Lahore. The next leg of the argument of the learned counsel for the petitioner on this point related to the Service Rules approved and adopted by board of directors of Fazal Vegetable Ghee Mills, Islamabad w. e. f. 5-4-1980 in its meeting held on the said date. The learned counsel for the…
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