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Petitioner: M/s. Telenor Microfinance Bank Limited VS Respondent: Province of Sindh and others
Court Name: Sindh High Court Judge(s): Salahuddin Panhwar, Adnan-ul-Karim Memon Title: M/s. Telenor Microfinance Bank Limited vs Province of Sindh and others Case No.: C.P. NO.D-6712/2020 Date of Judgment:2021-10-07 Reported As: 2021 SHC 940 Result: N/A
JUDGMENT
JUDGMENT SALAHUDDIN PANHW AR, J. This petition seeks direction to respondents/Sindh Employees Social Securit y Institution ( hereinafter referred to as 'the SESSI ) to issue registration cards for its insured workers/employees. 2. Briefly facts of the case are that petitioner is a company incorporated under the Companies Act 2017 registered under Provincial Employees' Social Security (Employer's Return and Records) Regulations 1967, pays contributions under Sindh Employees' Social Security Act 2016( the Act of 2016 ); that the Minister for Labour & Human Resources is a chairman of governing body of SESSI and its general superintendence vests with governing body while SESSI is an autonomous body under the Act of 2016 whose main function is to provide medical care and cash benefits to secured workers and their dependents as well death grant; financial benefit for iddat , disablement gratuity , disablement pension, survivors' pension and ex-gratia grant; SESSI's Commissioner (respondent No.2) is Chief Executive of the Institution, respondent No.3 is Directo r Administration responsible for registration of employees of petitioners and issuance of registration cards to secured employees/persons enabling them to avail benefits under the law. It is stated that petitioners have huge numbe r of employees out of which 590 are secured persons with SESSI; that though petitioners have registration certifica te and paying contributions yet its employees are still without registration cards therefore unable to avail benefits under the law; SESSI was approached even served with a legal notice dated 01.12.2020 yet in vein hence this petition. 3. Respondent No.2/Sindh Employees Social Security Institution filed their comments in CP No.D-6712/2020 contending that petitioner under the Provincial Employees Social Security (Contributions) Regulations, 1967 (the PESS [Contributions] Regulations of 1967) as a notified establishment under PESS Ordinance, 1965(the Ordinance of 1965)/Sindh Employees Social Security Act, 2016 is required to pay social security contribution under Section 20 and submit Form C-1 (Contribution Schedule) under Rule 4(11) of the Provincial Employees Social Security (Contribution) Rules, 1966 (the PESS [contribution[ Rules 1966 ) along with such payment to the
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Respondent Institution; Forms R-1 and R-2 (Registration of Secured person) unde r the Regulations 3 and 4 of the PESS (Employees Rules and Records) Regulations, 1967; that upon notification u/s 1(3) of the Ordinance of 1965/the Act of 2016, the petitioner was required to submit without delay to the Respondent institution Forms R-1, R-2, etc. under Employers (Returns and Records) Regulations, 1967 in respect of secured persons working with the Petitioner's Establishment; that Section 22 of the Act of 2016 (Section 21 of repealed PESS Ordinance, 1965) mandates that the responsibility of subm ission of Forms R, R-1, R-2, etc. which pertain to the registration of secured workmen is that of the Employer , i.e. the Petitioner but the Petitioner is not submitting the said information/forms to the Respondent Institution; the Petitioner Establishment has not filed any evidence with his petition which shows that the Petitione r submitted Form R-1 or R-2 with the Respondent Institution. Once completed, Forms R-1 and R-2 are required to be submitted to SESSI for processing and issuance of the R-5 Registration. 4. The submission of the forms can also be made online on SESSl?s web-portal. in fact, the Petitioner has miserably failed to complete and submit Forms R-1 and R-2; instead he has been dilly-dallying the matter unnecessarily and has filed this frivolou s Petition; that Section 70(d) of the Act of 2016 (Section 66(d) of the repealed Ordinance of 1965) states that failure on the part of an establishment not to furnish the above information (Forms R-1, etc.) are a criminal offence. As such Petitioner is in criminal breach of its duties with its failure to submit the requisite returns under the 1976 Regulations. It was further contended that Section 61 of the Act of 2016 (Section 57 of the Ordinance of 1965) states that if any person has any complaint regarding any question or dispute as to any benefit payable and or any other matter in respect of benefits, then such person may approach the Competent Authority with his/her grievance, i.e. the Commissioner , SESSI; that Petitioner complaint pertains to non-registration of secured workmen which is a matter that concerns secured workman. An aggrieved person in the present circumstances is/will be the secured workman who has been denied registration and not the Petitioner . The main cause of action in the current situa tion lies with the secured person to sue his employer/Petitioner for non- compliance of the SESSI laws and its failure to submit the Forms R-1 and R-2 which would enable it to avail benefits under the Act of 2016. This petiti on has not been filed by the aggrieved person, i.e. the secured workman. Instead, the person who is in breach of its statutory duty to file the relevant forms and get his employees registered with SESSI, has malafide filed this petition against the Respondent. Additionally , even if it is assumed that the petitioner is aggrieved by any action on the part of the Respondent Institution, then the Petitioner?s adequate alternate remedy available it to lodge its grievance lies under Section 61 of the Act of 2016, i.e. to file a Complaint against the Commissioner , SESSI. The petitioner cannot leap-frog the special law and special forum provided by the Legislature in case of complaints in relation to social security under the Act of 2016 and agitate this Petition; reliance was placed on the above proposition on (i) Standard Printing Press (PLD 1978 Karachi 945); (ii) Sunshine Dairies (PLD 1976 Karachi 1228; (iii) and Naveed Ullah Khan Bhatti (Lahore) (2006 PLC 593). It was further contended that Payment of contribution and service of benefits cannot be co-mingled and onus is on Petitioner to submit proper forms to Institution. The Supreme Court of Pakistan in the cases of (i) Spencer & Company (Pak) Ltd. (1998 SCMR 440) and (ii) Sindh Abadgars Sugar Mills Limited (2009 SCMR 367) has consistently held that the payment of contribution and service of benefits to the secured workmen cannot be connected. They are separate and the Petitioner cannot wriggle out of his liability to pay social security contribution and submit Forms; that onus is on the petitioner to submit the relevant forms which it has miserably failed to do. On receipt of Form (R-2) the Respondent Institution then issues the Secured Persons? Registration Card Form R-5 under Employers (Returns and Records) Regulations, 1967 to such secured persons whose information has been provided by the Petitioner but the Petitioner has not done the needful. The Respondent institution has made efforts by sending notice (Annexure M) to the Petitioner to submit the above Forms, so that secured person s? Registration Card (R-5) may be issued to such persons to enable them to avail all the benefits mentioned but without any luck. Form R-1, R-2, etc. are available online on SESSI website, stationary shops, in the Rules and Regulations of SESSI. The Petitioner continues to hide behind excuses not to register its employees. lnspite of the above the Petitioner , Telenor Microfinance Bank Ltd. has not submitted details of its workmen on whose behalf it has been paying contribution on Form R, R- 1 and R-2, which are mandatory forms in order for the Respondent Institution to register
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its employees with SESSI. The Petitioner Establishment has been filing Form C1 (containing the names and CNIC of the secured workmen); but the same are neither sufficient for registration nor a substitute for Forms R-1, R-2, etc. required for registration of secured workmen. The Petitioner must follow the proper procedure for registration laid down in the Rules and Regulations of SESSI which are publicly available. The Petitioner , Telenor Microfinance Bank Ltd. has failed and continues to fail to provide the missing information forming part of forms R, R-1 R-2 etc. to the respondent. It was further stated that Notification is issued by the Government of Sindh not SESSI hence Petition not maintainable against SESSI; that Government of Sindh has issued the present notification under Section 1(3) of PESS Ordinance, 1965 which is currently in force and applicable to the Petitioner Establishment, as per Section 1(3) of the "SESSI Act, 2016 the Scheme is establishments defined in Section 2(12) of the Act, from such date or dates and with regard to the provisions of such benefits as Governme nt may be notification, specify in this behalf. As per directive of the Honou rable Supreme Court of Pakistan the provision under Section, 1(3) of the Act, is applicable on Territorial Basis w.e.f. December , 2011. As mentioned above the current Notifications in force have been issued pursuant to the Judgment of the Supreme Court of Pakistan in the Citizen's Foundation case reported in 2009 SCMR 367/2010 PLC 489. Further , the Supreme Court of Pakistan has clarified that no grievance regarding the procedure for issuance of the Notification can be raised in respect of the grounds as alleged by the Petitioner detailed therein in PLD 2002 SC 726. In addition to the above-titled Petition, i.e. CP No.D-6712/2020 Petitioner has also filed CP No.D-2249/2021 in which they have also impleaded SESSI in the array of Respondents. The Petitioner continues to harass the Respondent institution by filing frivolous litigation from time to time; instead of complying with the law and paying social security contribution and submitting the relevant forms to get their employees registered; there also appears to be yet another Petition filed by Telenor but respondent institution is not party to these proceedings i.e. CP No.D-6713/2020. 5. Respondents/SESSI have further contended that they Labour Department, Government of Sindh. The general direction and superintendence of the affairs of the institution vests in the Governing Body , which with the assistance of the Commissioner (Chief Executive), exercises all powers. As a body corporate the Respondent Institution works and carries on its business independently without any impediment of the Government (expect instructions or question of policy given by the Government under Section 4(2) of SESSA, 2016 (Section 4(2) of the repealed PESS Ordinance and under the rules and regulations framed for its operation, function and running. (Reliance is placed on PLD 1956 SC 445 and 2008 PLC (C.S.) 949). The Respondent Institution neither relies on any government funds or public or taxpayer money nor borrows any monies from the Federal or Provincial or any other authority for running of its affairs. The Respondent Institution has its own Fund which is generated on the basis of contributions paid by notified establishments, profit on investment and other income (Section 28, PESS Ordinance, 1965). 6. It is further the case of SESSI that after registration of an establishment the employer of the establishment is liable to pay social security contribution to the Institution in respect of every employee, as defined in Section 2(9) of the Act, 2016, whether employed by him directly or through any other person at the rate of 6% of his wages provided that an employee shall not, cease to be an employee for the reason that his monthly wages exceed the statutory threshold of minimum wages plus Rs.5,000 . Presently , S.S. Contribution is received/receivable at the rate of minimum wages. The payment of social security contribution by the employer is statutory and mandatory . It is not subject to demand by the Institution. The social security contribution for the preceding month is payable in the following month. If any employer fails to pay social secu rity contribution to the Institution by the due date, the contribution payable by him increases day by day at the rate of 1/2% per day subject to the maximum of 50% of the amount due as per Section 24(1) of the Act of 2016. The primary aim of Application of Scheme of Social Security on the establishment is to provide benefits and facilities to secured employees or their depen dents in the event of sickness, maternity , employment injury or death, lddat benefits, disablement gratuity , disablement Pension, survivors Pension and medical care and for the matter ancillary thereto as provided Section 36 and 47 of the Sindh Employees Social Security Act, 2016. Although the Government of Sindh aims to issue fresh rules and regulations under the Act of 2016, the same are still under process of being replaced; hence the 1966 rules and the 1976 regulations issued under the
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Ordinance of 1965 continue to remain in force. SESSI conducted awareness programs through SESSI Public Relation Wing cum-T raining & Research institute. SESSI Public Relation Wing-cu m-Training & Research Institute from time to time publishes advertisement in the leading newspapers documenting and informing general public about the activities of the institution. (clipping enclosed). Besides, Public Relation Wing-cum- Training & Research Institute, SESSI publishes Annual Administration Reports, Pamphlets and Quarterly News Bulletin in the name of BEHBOOD" which mentions activities performed by SESSI every quarterly . Prior to the Coronavirus (Covid-19) pandemic beginning February 2020, advertisement regarding awareness of Social Security published in leading newspapers on 5"` November 2019 . One seminar has been conducted at Hyderabad (Hyderabad and Kotri Directorates) on 29-10-2019 and one seminar at Sukkur Directorate on 30-10-2019 and on 8"` November 2019 at Karachi Report regarding awareness programs held at Hyderabad, Sukkur and Karachi were also published. in daily newspapers. Directions have already been issued to the Directors of SESSI Local Directorates to convene meetings with Deputy Commissioner concerned and to apprise them regarding awareness programs conducted by SESSI and convey message of Social Security Scheme. SESSI also runs awareness program on Typhoid vaccination with collaboration of District Health Officer West (WHO) held at KVSS SITE Hospital on 7th November ,2019. Apart from above, Commissioner , SESSI and Local Directors of SESSI hold meetings with the Employers and Employees Associations of Karachi, Hyderabad, Kotri and Sukku r from time to time of regarding Social Security Contribution and benefits provided by the SESSI to the Secured Workers and their dependents admissible under SESSI Act, 2016. `These awareness and informational programs which were shut down through most of 2020 due to the Coronavirus (Covid-19) pandemic have recently restarted since March 2021 subject to NCOC and Government of Sindh Lockd own Orders/Permissions for Public Gatherings. The mechanism for providing medical facilities to secured worker and their dependents through 42 Dispensaries and 5 Hospitals of SESSI at Karachi, Kotri, Hyderabad and Sukkur Sindh, which are easily accessible for secured worker to get medical facility . SESSI not only provides basic medical and surgical facilities to secured workers and their dependents but also provides a treatment of Hepatitis, Cancer , Cardiac, Neurosurgery , Bone Marrow and Kidney Transplantation as well from private hospital on the recomm endation of concerned Medical Superintendent and Chief Medical Officer by paying amount through permission/reimbursement. During the Coronavirus (Covid-19) pandemic, SESS I has also provided medical care and support in the national fight against the virus. In August 2021, the Respondent Institution and NADRA have signed an MOU for preparation of Smart Card (Benazir Mazdoor Card) for register ed Industrial workers. NADRA has also started registration and the facility is also available to the secured workmen of the Petitioner Establishment. But the statutory onus of submission lies with the Petitioner as per Section 22 of SESSI, 2016. The step-by-step procedure for the registration of the Employees at SESSI, as per the Provincial Employee's Social Security (Employers' Return and Records Regulations, 1967) is set out as follows: STEP 1: Form C-1: On notification of the establishment the establishment is required on its own to submit form C-1 (Regulation 8). Form C-1 states the payment and the names of the Employees in respect of whom the payment is made. The online version of Form C-1 is attached to the pleadings in electronic format. This electronic format is submitted on the SESSI website online. STEP 2: R-1 Form: Simultaneously with the filing of Form C-1, the Employer is also required to submit R-1 form; informing the number of employees. The employer shall within 10 days submit the R-1 form to SESSI. STEP 3: R-2 Form: Together with the R-1 form, the Employer is also required to submit the R-2 form duly completed by the Secured workman with all missing data mentioned in the form populated with the required information and photographs. The Employer usually passes the R-2 Form to his employees to fill it and hand it back to the Employer for handing them over along with Form R-1 to the Resp ondent Institution. The secured person shall fill the R-2 form by providing the details which includes his Name, CNIC, Address, Name of Dependents (including Parents and his children), and the marriage certificate, if he is married, and the birth certificate of the children, if he has children along with the 3 passport size Photos of secured person and all of his Dependents). The photos are also attested by the Company to confirm that the said person is employed at the notified establishment. In R-2 Form, the Employee shall also identify the Dispensary to which he wishes to be
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associated and from where he would collect the benefits. The R-2 form also is submitted by the Employer along with R-1 form to SESSI. Forms R-3 and R-4 given in the Regulations of 1967 have been discontinued and are no long in practice/vogue anymore. STEP 4: Form R-5: On receipt of duly completed R-2 Form along with all its particulars from the Establishment the Institution shall within 15 days issue R-5 (card), of each of the Employees to the Employer and/or his company . The employer would then pass on the R-5 cards to his respective employees. Registration ID Card has photos of secured workmen and their dependents. All Forms R, R-1 and R-2 are available online as well as can be submitted online. Physical forms are available with SESSI and Stationary shops which carry proforma of other forms under the labour laws of Pakistan, such as, Petiwalla in Karachi. Further the format is given in the Regulations of 1967. 7. It was further contended that Petitioner's establishment is a notified unit under the Social Security Scheme and the same was registered with the name and style of M/s. Tameer Microfinance Bank Ltd., vide Notification No. L- II(SESSl)5-9/2010 dated 19/12/201 1 the name of M/s. Tameer Micro Finance Bank Ltd. was changed to M/s. Telenor Microfinance Bank Lid. Social Security Contribution for the month of July 2021 in respect of 408 employees for which contribution amounting to Rs.550,470 has been deposited by the Petitioner online . Approximately for the last one year the petitioner is making online payment that is fluctuated according to the strength of the employees of the Petitioner , and prior to online deposit of S.S. Contribution the same was being deposited manually . Recently , the Petitioner , Telenor Microfinance Bank Ltd. has become litigious and filed CP No.D-2249/2021 challenging the quant um of contribution dues set out in SESSI's Demand Notice dated 20.01.2021 sent to the Petitioner and challenging the demand in the Court. The Respondent Institution is in the process of filing Written Comments in the said CP No.D-2249/2021 and expects the petitioner to pay the true and correct social security contribution payable by them in accordance with law. The Written Reply does not constitute a waiver or release of SESSI's claims against the Petitioner . According to the policy of the Respondent Institution where the establishment is situated it is registered with the concerned Directorate of the Institution, and the concerned Directorate of the Institution is approached by the employees for getting the R-5 Card under the Social Security Scheme. However , the complete picture is already submitted above. It is admitted that the strength of employees of the Petitioner fluctuates, and that S.S. Contribution is deposited according to the strength of employees. The burden of submission of the proper forms is on the Petitioner . Ignorance of law is no excuse; the Petitioner's employees have never applied for getting R-5 Registration Card. As a matter of fact the thorough procedure for getting the R-5 Card is laid down and the respective employee has to undergo the process for getting the R-5 card. In this regard the Petitione r was apprised in our very first letter of Notification as already attached herewith and marked as Annexure M) along with which all the relevant documents were provided to the Petitioner . Neither the Petitioner nor his employees have approached the Institution for getting the R-5 Card, if the Institution would have been approached by the Petitioner or his employees; the R-5 Registration Card had definitely been issued. Moreover , the Institution has started making online the NADRA R-5 Registration Card with the help of NADRA, and for this purpose the employee has to visit the office of the Institution. The Petitioner has not produced any evidence whatsoever when and how he complied with the law and submitted the relevant form "R" series. There is no contemporaneous evidence submitted by the Petitioner . As a matter of fact the applications required as precursor to the R-5 Card were never made and thus for want of information of the employees, the R-5 Card could not be made. 8. Respondents/SESSI have emphasized that there is not a single example that the R-5 Registration Card might have been refused by the Institution after its formal application. Petitioner has never applied for getting the R-5 Cards for his employees, and there is no evidence on the hand of the Petitioner that at any stage the R-5 Registration Cards may have been applie d by the Petitioner or his employees. Even otherwise, No R-5 card can be issued without submission of the R series forms such as R-1, R-2, R-3, etc. All these forms are required to be submitted to the Institution first and the Petitioner has not filed any evidence befor e this Court that such materials as per the Rules and Regulations were provided to the Institution; hence Respondent Institution has no objection to the grant of the relief prayed by the Petitioner after submission to the Institution of the duly completed relevant
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forms, such as, R-1, R-2, etc. (Annexure M) required to register the employees of the Petitioner Establishment. The Respondent Institution will be pleased to extend social security benefits to the secured workmen of the Petitioner in accordance with law after the Petitioner has complied with all the provisions of law and happily grant the R-5 Registration to the secured workers of the Petitioner Establishment after provision of the requisite information of his employees is submitted by the Petitioner Establishment to the Institution. 9. Heard learned counsel for the parties and perused the record. 10. The core issue, compelled the petitioner to approach this court was that of denial of institution (respondent) from issuing registration cards to worker s/employees of petitioner , however , the respondent (institution) through comments while admitting :- i) the Act is beneficial for workers/employees; ii) the status of institution as autonomous body which generates its own funds; iii) every industry was/is required to register its workers/employees with institution; iv) every single worker was/is entitled for benefit but if he/she earns status of secured worker ; v) the status of secured worker could only be earned if the industry itself while completing formalities submits required Form (s) and pays contribution ; categorically stated that if the petitioner completes formalities then the respondent (Social Security Institution) shall happily issue the registration card(s). 11. Though, the dispute appears to be no more a dispute yet has given rise to number of propositions to be answered which, prima facie , include: a) Whether on failure of the industry estab lishment as notified in getting its employees registered,…
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