1. ' ARSHAD NOOR KHAN, J.---This Constitutional Petition under Article 199 of the Constitution of Islamic Republic of Pakistan, 1973 has been filed by the petitioner whereby the notice issued by respondent No,2 for depositing the arrears of Sindh Employees Social Security Institution has been challenged.
2. ' The facts necessary for disposal of this petition in brief are that the petitioner is a body corporate under Security Exchange Commission of Pakistan as a mission driven and process oriented organization with global operation. It is further stated in the petition that the petitioner has more than 500 employees to whom they offer excellent employment opportunities to the quality human resource of Pakistan by offering highest remunerations along with benefits including pick and drop facility. The company also maintained cars, club memberships, healthcare and medical facilities, life insurance plan, complete career growth with in house and internationally certified training programs and an enviable life style to attract and retain the best human resource and axact's production facility in Karachi is the largest technology infrastructure of Pakistan with a working capacity of over 2500 employees. It is further stated in the petition that the petitioner received notice annexure "C" to the petitioner issued by the respondent No,2 claiming therein an amount of Rs,456,750 as social security contribution of employees whose salary is less than 5000 per month as required under the provision of Social Security Ordinance, 1965 (hereinafter shall be referred to the Ordinance, 1965) which is not applicable to the petitioner as none of the petitioner's employee draws salary below Rs,6000 per month. It is further stated in the petition that the respondents Nos.2 and 3 could not claim for social security contribution or its increase from the establishment whose employees were not benefited by the respondents and their claim is totally illegal, unlawful and of no legal effect. It is further stated in the petition that when it was communicated by the authorized representative of petitioner that the provisions of Ordinance, 1965 are not applicable, the respondents Nos.2 and 3 all of sudden on 25th of March, 2008 visited the office of petitioner at 5-00 p.m. And started threatening the staff of the petitioner by showing certain warrants in support of their claim and on 26th March, 2008 the respondents Nos.4 and 5 along with other unidentified persons visited the office of petitioner at 5-00 p.m. And abused the staff and also attached Toyota Hiace bearing No,TF-4078 after preparing inventory hence the present petition.
3. ' The respondents have been served with the notice who have filed counter affidavit to the contempt application and have not filed the objections or comments to main petition.
4. ' We have heard Mr. Abdul Karim Khan Advocate for the petitioner. Mr. Jawwad A. Sarwana, Advocate for respondents Nos.2 and 3 and Mr. Shafi Muhammad Memon, Additional AdvocteGeneral for respondent No,1.
5. ' Mr. Abdul Karini Khan Advocate for the petitioner vehemently contended that provisions of Ordinance, 1965 do not attract as none of employee of the petitioner is receiving less than Rs,6,000 P.M. And the provision of Ordinance, 1965 are applicable where the employees receive less than Rs,5,000 P.M. As such notice issued by respondent No,2 is contrary to provisions of Ordinance, 1965 and is illegal, inoperative and against the competency and powers of respondents Nos.2 and 3. He further contended that attachment of Toyota Hiace by the respondents is unlawful and in excess of powers vested in them as such respondents have acted in excess of their power and have violated the provisions of Ordinance, 1965 as such action of the respondent regarding issuance of notice thereby demanding contribution as well as attachment of Toyota Hiace is illegal and it may be declared as void ab initio.
6. ' Mr. Jawwad A. Sarwana Advocate for respondents Nos.2 and 3 has contended that provisions of Ordinance, 1965 are fully applicable to the present case and in case of default of contribution the respondents Nos.2 and 3 are well within their right to confiscate any of the property of the defaulting employer. It is further contended that in spite of service of notice neither the petitioner furnished necessary details nor paid the contribution demanded from them as such they are defaulter and that the petition is not maintainable. In support of his contention he has relied upon the case of Sunshine Diaries Ltd. v. Commissioner of Sindh Employees Social Security Institution reported in PLD 1976 Karachi 1228. The case of Kohinoor Company and others v. Sindh Employees Social Security reported in PLD 1977 SC 197 and case of Sindh Employees Social Security Institution v.
7. Messrs Corn Pak Ltd. Reported in 1988 PLC 115. Learned Additional Advocate-General adopted the arguments advanced by the learned counsel for respondents Nos.2 and 3.
8. ' We have considered the arguments advanced by the learned counsel for the respective parties and have gone through the record available before us as well as case law relied upon by the learned counsel for the respondents.
9. ' The petitioners are claiming exemption from payment of contribution as required under section 20 of Ordinance, 1965 which speaks about payment of contribution by the employer in respect of every employee whether directly by him or through other person, is liable to pay the institution a contribution on such rate fixed by Institution but not more than 6 percent, on the ground that none of their employee is receiving monthly pay less than Rs,5000.- Since the petitioner informed the respondents that none of their employee is getting monthly salary less than Rs,5000 per month, it was obligatory on the part of respondents to make enquiry about the stand taken by the petitioner to arrive at a conclusion as to whether none of employee of the petitioner is getting monthly salary less than Rs,5000. For the said purpose the Ordinance, 1965 empowers the institution to hold enquiry by appointing an official, duly authorized by a certificate in a form specified in the regulations, may, for the purpose of inquiring into the correctness of any of the particulars stated in the records or return referred to in section 21, ibid, or for the purpose of ascertaining whether any of the provisions of the Ordinance, 1965 have been complied with and the said officials, so authorized by the institution require an employer to furnish him such information as he may consider necessary and at any reasonable time enter any establishment or other premises occupied by such employer and require any person found in charge thereof or produce and allow him to examine such accounts books and other documents relating to the employment of persons and payment of wages, or to furnish such information, as he may consider necessary, or examine, with respect to any matter relevant to the purposes aforesaid, the employer, his agent or any person found in such establishment or other premises, or any other person whom the said official has reasonable cause to believe to be or to have been a secured person. The complete mechanism has, therefore, been provided in section 22 of Ordinance, 1965, thereby authorizing the institution to appoint a person to hold enquiry about ascertainment of such stand taken by the employer or for the said purpose the said authorized person who possesses certificate issued by the institution to enquire any person of the employer and may examine any of the record for the purpose of ascertainment of stand taken by the employer. In the recent case admittedly the respondents have not adopted the procedure provided under section 22, ibid, while issuing notice to the petitioner for payment of Rs,4,56,750 being the arrears of contribution of said employee of social security institution. A perusal of notice shows that it is completely silent to show that on what evidence or strength the respondents calculated the arrears mentioned in the said notice or it does not speak about holding of any enquiry as envisaged under section 22 of Ordinance, 1965. The respondents even have not filed any counter affidavit, or have not brought any material on record to show that in what manner they have calculated the amount of Rs,4,56,750 towards arrears of the contribution, nor it is specified for how much employees who are allegedly getting salary below Rs,5000 per month, the said arrears have been calculated. The respondents, therefore did not adopt the procedure provided in the Ordinance, 1965 for assessing the contribution and penalizing the petitioner. The petitioner after amendment in the Ordinance, 1965 whereby the quantum of salary from Rs,5000 to Rs,10,000 has been enhanced, have deposited contribution since from July, 2008 vide cheque dated 25-10-2008 which has not been controverted by the respondents, which shows that bona fide of petitioner who after enhancement in the monthly payment of worker from Rs,5000 to Rs,10,000 per month followed the provisions of section 20-A of the Ordinance, 1965.
10. ' The grievance of the petitioner that Toyota Hiace has been attached illegally by respondents Nos.2 and 3 seems to be genuine and reasonable as after service of notice of the contribution, the respondents Nos.2 and 3 were not permitted under the provisions of Ordinance, 1965 to attach any movable or immovable property of the defaulter, so as to compel the defaulter to deposit defaulted contribution. Section 23 of Ordinance, 1965 speaks about non-payment of contribution and its recovery and procedure regarding recovery of contribution. Section 23, ibid, postulate that if, employer fails to pay the said contribution, the same should be recovered as arrears of land revenue. Section 23 of Ordinance, 1965 is usefully quoted herein below for the sake of convenience:--- "23. Increase of unpaid contributed and recovery of contribution, etc., as arrears of land revenue.-- - (1) if any employer fails to pay on the due date the contribution payable by him under subsection
(1) of section 20, the amount so payable by him shall be increased by 'such percentage or amount as may be prescribed: ' Provided that in no case shall such increase exceed fifty per centum of the amount due: ' Provided further that no part of such increase shall be payable by, or the liability to pay the same be passed on by the employer to, his employees.
(2) Without prejudice to any other remedy, the amount of the contribution due, together with the increase provided for under subsection (1) may be recovered as arrears of land revenue."
11. Section 23 (ibid), shows that if any employer failed to pay contribution calculated in terms of subsection (1) of section 20 of Ordinance, 1965 the said amount is not paid by him after issuance of notice as prescribed by the authority then such amount may be recovered as arrears of land revenue, section 23 of the Ordinance, 1965 therefore do not empower the respondents to attach any movable or immovable property of the defaulting employer but provide mechanism to recover the contribution as arrears of land revenue and for the purpose of recovery of arrears of land revenue a complete and comprehensive procedure is provided in Chapter VIII of the Land Revenue Act, 1967 and by virtue of chapter VIII the matter shall be referred to Collector for the purpose of recovery of government dues and from section 81 of the Land Revenue Act, 1967 the mechanism of recovery of land revenue comes in operation as such the act of respondents Nos.2 and 3 in attachment of Toyota Hiace of the petitioner directly, appears to be in excess of their power and the said act of respondents Nos.2 and 3 could not be sustained in view of section 23 of Ordinance, 1965. The act of respondents Nos.2 and 3 in attachment of the Toyota Hiance is therefore declared as illegal, void ab initio, ultra vires and against the provisions of Ordinance, 1965 and they are detected to release the Toyota Hiace forthwith and adopt lawful methods for recovery of arrears of contribution, if any, in accordance with section 23 of Ordinance, 1965. The case law relied upon by the learned counsel for the petitioner speaks about proposition regarding jurisdiction of civil court in the matter of Sindh Employees Security Institution and furthermore the case of Sindh Employees Security Institution 1988 PLC 115, speaks about furnishing the security at the time of filing of appeal before Social Security Court, which in our humble opinion are not applicable to the circumstances of the present case.
12. In view of the aforesaid circumstances, we are of the opinion that the respondents wilfully and deliberately violated, the provisions of Ordinance, 1965 while penalizing the petitioner and by forfeiting the Toyota Hiace as such the act of the respondents are declared as illegal, inoperative, void ab initio and ultra vires to the Constitution and is of no legal effect against the petitioner. The petition is therefore, allowed in the terms stated above.