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PLD 1996 KARACHI 27

Per Nazim Hussain Siddiqui, J.

(a) Constitution of Pakistan (1973), Articles 153, 154, 173 & Fourth
Schedule
R/w Legislative List, Federal Legislative List, Part II, Entry 3———

Perusal of these Articles shows that the object of C.C.I, is to safeguard the interest of Federating units and to establish good relations between the Government of Federation and the Provinces. C.C.I. is to work as laid down in Article 154 and is responsible to both the Houses of Parliament. C.C.I. is required to formulate and regulate polices in relation to matters in Part II of the Federal Legislative List. The Council has two main functions to perform. One to formulate and regulate policies as stated above, and second to exercise supervision and control over related institutions. Part II of the Federal Legislative List contains 8 items and entry No.3, which is relevant for these matters, speaks about of “Development of Industries”. We are of the view that the Council would have power to formulate and regulate polices when basically the question is of development of industries and the development is declared by the Federal law to be expedient in the public interest. In these case, the controversial point is not about development of industries but disposal of property vested in the Government. Prima facie, the development and disposal are two different propositions and stand for different legal meanings. Suffice it to say that C.C.I. has nothing to do so far the disposal of the Government property, is concerned.[pp.35, 36]A

There is no nexus between the two terms/words “DEVELOP” and “DISPOSE” and that C.C.I. is only concerned with the development and the disposal of the Government property is a different matter, which is governed by Article 173 of the Constitution.[p. 36]D

(b) Constitution of Pakistan (1973), Article 253

This Article cannot be invoked where the question of the disposal of Government property is involved, nor the Government can be compelled to run any trade, business, or industry; which it does not want to carry on.[p.37]E

(c) Constitution of Pakistan (1973), Article 173

“It is thus clear that Article 173 is in pari matria with Article 298 of the Indian Constitution. We find no reason to differ with the approach of the Indian Supreme Court in Rai Sahib Ram’s case which is in accord with the principle of interpretation of Constitutional instruments that the Constitutions are to be interpreted organically and harmoniously. Every word in the Constitution is to be given effect by harmonizing the various provision of the Constitution and nothing is to be rendered surplus or redundant.

We are, thus of the view that no specific legislation is necessary for the exercise of executive authority under Article 173(1) ibid of our Constitution for the purpose of sale, mortgage or disposal of the property by the Federal/Provincial Government of course if an Act of the appropriate legislature holds the field its provisions shall be followed by the executive authority in the matter of sale, mortage or disposal of the property vested in the Federal or Provincial Government. However, existence of an Act of the appropriate legislature is not a prerequisite for the exercise of the executive authority under Article 173(1) of the Constitution.”

It is pointed out here that the judgment of Galicon case was challenged before the Supreme Court in Appeal No. 70/L of 1992 and the petition was dismissed with the following observations:

“We have heard Mr. K.M.A. Samdani, Advocate for the petitioner but we do not consider it necessary to go into all the questions agitated before the High Court because we are fully satisfied that the petitioner’s writ petition stands rightly rejected.”

We agree with the dictum laid down in the Calicon case and hold, with reference to the facts of this case, that the Federal Government was competent to dispose of the property involved in these petitions.[p.43]F

(d) Constitution of Pakistan (1973), Article 25

It is not dispute, nor it could be, that reasonable classification is always permissible under law. Classification which is based upon substantial difference with reference to the object or persons dealt with is always permissible under law. It does not violate the principle of “Equal Protection of Law”. The provisions of this Article do not speak about abstract equality, but in fact, proclaims equality before the law. The officers and workers are two different type of employees and their terms and conditions of service are also distinct. Classification for them was within the parameter of legally permissible actions.[p.47]G

(e) Constitution of Pakistan (1973), Article 4, Fourth Sched.
R/w Transfer of Managed Establishments Order (12 of 1978)——

It is quite clear that the expression “development of industries” appearing in Item 3 of Part II is subject to the words that follow, namely, “where development under Federal control is declared by Federal law to be expedient in the public interest”. The earlier nationalization has since been reversed by Federal law which now, on the contrary, deems it “necessary in the public interest to transfer the shares or proprietary interests in respect of a managed establishment acquired by it”, in other words, to privatise certain such establishments. (Section 2 of Act XXII of 1991 substituting Article 4 of P.O. 12 of 1978). Accordingly, the said item 3 has no application in the present case and does not preclude or affect transfer pursuant to the provisions of law as amended by Act XXII of 1991.[p.60]I

(f) Constitution of Pakistan (1973), Article 4,154, 97, 199.
R/w Transfer of Managed Establishments Order (12 of 1978)——-

It is not before us what, if any, formulation and regulation of policies the Council has undertaken or, for that matter, what supervision and control it has exercised in terms of Article 154(1). The Council has not been made a party to the proceedings and it is not necessary for us to determine whether, if at all, it could be made a party. Clause (5) of Article 154 provides specifically for the Federal Government or a Provincial Government to question a decision of the Council before a joint sitting of Parliament “whose decision in this behalf shall be final”. Whether any other party can therefore do so is not strictly a question before us, so we need not dilate upon it.

However, Council is composed of the representatives of the Federal and the Provincial Government and is responsible to the Parliament in joint sitting. No direction has been sought calling upon the Council to perform its functions and although again not necessary for us to decide, it does not to our mind appear within the competence of a private party (as opposed to the Federal or a Provincial Government) to seek such a direction to enforce the words “The Council shall” in clause (1) of Article 154 of the Constitution. Moreover, Article 97 of the Constitution reads as follows:-

“97. Subject to the Constitution, the executive authority of the Federation shall extend to the matters with respect to which (Majlis-e-Shoora (Parliament) has power to make laws, including exercise of rights, authority and jurisdiction in and in relation to areas outside Pakistan:

Provided that the said authority shall not, save as expressly provided in the Constitution or in any law made by (Majlis-e-Shoora (Parliament), extend in any Province to a matter with respect to which the Provincial Assembly has also power to make laws.”

Clearly, therefore, the Federal Government had the executive authority over the subject-matter and there exist no provision which prevents it.[pp.61,62]J

It is clear therefore that even the Parliament in joint sitting acts “through the Federal Government to the Concil”. Thus, in the absence of any direction, either from Parliament in joint sitting or the Council of Common Interests, the authority of the Federal Government is unfettered.[p. 62]L

(g) Constitution of Pakistan (1973), Article 4, 173, 154
r/w Transfer of Managed Establishments Order (12 of 1978)——

Finally, Article 173 of the Constitution specifically provides, inter alia, that “The executive authority of the Federation…..shall extend …. to the grant sale, disposition or mortgage of any property vested in ….. Federal Government….. and to the making of contracts”. This provision is only subject to any Act of the appropriate legislature, and there exists no enactment which prevents such a sale or disposition as is now envisaged by the Federal Government.

Therefore, in al respect, it is the Federal Government which is the executive authority with necessary powers in this matter. Even Article 154(4) in relation to the Council of Common Interests envisages the Federal Government as the appropriate authority. It reads as follows:-

“(4) (Majlis-e-Shoora (Parliament) in joint sitting may from time to time by resolution issue directions through the Federal Government to the Council generally or in a particular matter to take action as (Majlis-e-Shoora (Parliament) may deem just and proper and such directions shall be binding on the Council.”[p.62]K

(h) Constitution of Pakistan (1973), Article 4, 173
r/w Transfer of Managed Establishments Order (12 of 1978)——-

It may also be mentioned that, admittedly, each new owner is a legal entity being a company incorporated under the Company Law and is presently governed under the Companies Ordinance, 1984. The nature of shares and Certificates of Shares are described under section 89 of the Companies Ordinance, 1984, as movable property transferable in the manner provided in the Articles of the Company, and section 76 of this Ordinance specifically deals with transfer of shares. Thus, the Federal Government, under Article 173 of the Constitution read with Article 4 of the Transfer of Managed Establishment Order, 1978, as amended by Act XXII of 1991 read with the relevant provisions of the Companies Ordinance, was fully competent to cause the transfer of shares of the managed establishments, subject to the terms of the agreement executed with the purchasers in this regard. That being so, the Federal Government was, indeed, competent to privatise/sell the establishments owned by it to the respondent private parties and, for the reason given above, consultation with the Council of Common Interests was not required.[p.63]M

(i) Constitution of Pakistan (1973), Article 4, 199.
R/w Transfer of Managed Establishment Order (12 of 1978)——

Consequently, the cases under consideration being governed entirely by Act XXII of 1991, the employees ceased to have the protection of continuance in service on the same terms and conditions as were available to them when they were employees of establishments in public sector. That being so, after privatization, the ordinary law of master and servant, subject to any other application law and the terms of transfer which the Government deems fit, applied and governed the rights of the petitioners as to their service. Accordingly, the terms and conditions of service of the petitioners could not be enforced through these Constitutional petitions, as rightly submitted by all the learned counsel for the respondents.[p.67]Q

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