' SHAHID ANWAR BAJWA, J--- With the consent of learned counsel for the parties these miscellaneous appeals were finally heard at Katcha Peshi stage and are being decided accordingly.
2. These appeals are filed under Section 34 of the Securities and Exchange Commission of Pakistan Act, 1997 read with section 7 of the Companies Ordinance, 1984. The appellant in Miscellaneous Appeal No,16 of 2010 is working as Deputy Registrar (Companies) in the Securities and Exchange Commission of Pakistan (hereinafter referred to as the SECP) in CPS-07 (equivalent to grade 18). He entered employment in the year 2000. SECP has a Potential Assignment Policy under which policy the officers were rated in one of the categories of; High Potential, Proving stage, Assets or Need Improving. High potential officers are those who "will be promoted within a period of three years depending on availability of suitable vacant posts". It is also provided in the policy that a maximum of 15 per cent of officers in each division/department can be assigned rating of "High Potential". It is also provided that if high potential officer is not promoted after being assigned potential rating for continuous period of three years he may be provided with job enrichment and enhanced compensation/rewards. It is also provided in the policy that potential ratings for each officer will be assigned by the concerned Executive Directors on the potential assessment form and will be endorsed by the concerned Commissioner. It is further provided that division-wise list of officers containing their ratings will then be presented before the Commission for final approval. For the year ending 2008 overall performance of appellant was rated excellent and he obtained an average of 9.19 marks when it was also noted in the performance appraisal form that the appellant was a capable, competent, intelligent, hardworking and devoted officer and needs to be promoted.
In the potential assessm ent form appellant was shown as a high potential employee. In a meeting of Commission held on May 20, 2009 it was decided as under:--- Potential Assessm ent Rating & Promotions (Working Paper No,104). Chairman stated that potential assessm ent ratings and promotion recommendation from various Divisions/Departments of SECP as per Potential Assessm ent Policy have been received by HR Department (duly approved by the concerned Commissioner) including those of Junior Executives and Assistant Directors. It was recommended that all promotions from Junior Executives to Assistant Directors and Assistant Directors to Deputy Directors be made w.e.f, 1st July, 2009.
' On the basis of potential assessme nt ratings and recommendations in respect of each officer, their promotions to next grade be and hereby approved (as per list attached). It was also agreed that a salary increased of 15% in basic salary on promotion shall be given to each promoted officer.
Necessary letters in this regard will be issued by the Human Resource Department.
3. Appellant was also recommended for promotion as it was stated in the potential assessment form that he worked beyond expectation. A meeting of SECP was held on April 22, 2009 and following transpired in that meeting:---
(a) Revenue was estimated at Rs,1.358 million and expenses at Rs,1.64.2
(b) Capital expenditure was estimated at Rs,663 million and, therefore expected deficit was at Rs,284 million.
(c) Economy measure was proposed and this included that promotions of Deputy Directors and above be delayed for a period of 6 months to one year.
(d) It was approved that no promotions above the level of Deputy. Directors should be made.
However, if revenue is improved then promotions issue would be revisited in meeting midterm review in January, 2010.
4. On December 23, 2009 Commissioner (Law) prepared a working paper. After referring to earlier decision on economy measures he stated that there was net surplus of- income over expenditure and, therefore, duly recommended officers should be promoted. The matter was taken up in meeting of Commission and after detailed discussion it was decided as under:-- (i).
(ii) Comparatively, the Commission is a top heavy organization which requires a suitable reorganization/adjustment.
(iii) The Commission is already in litigation about its tax status and a threat of huge contingent tax liability cannot be ignored.
(iv) The existing promotion/potential assessment policy needs to be reviewed and a fresh criteria will have to be evolved.
' Keeping in view the above, it was Resolved that the proposal may not be supported at this stage unless the specific issues as mentioned above are addressed appropriately. In this connection, Executive Director (HR) be directed to review the existing potential assessment policy in light of the above stated observations and a revised promotion policy be submitted to the Commission for its consideration and approval.
5. Commissioner (Legal) recorded his disagreement.
6. Performance Approval of appellant for the year 2009 was prepared. He was granted marks of 6.62 and rating of Good which was subsequently changed to very good by the appraiser's supervisor.
7. In comments by the SECP it is stated that Promotion Assessment Policy is meant only for internal guidance. It was further contended that it has not been violated. It was also contended that there are no statutory rules and, therefore, employment of the appellant was governed by the law of Master and Servant. It is also stated that although initially appellant was recommended but in the final list approved by the SECP the appellant was not approved for promotion. It was also stated that in 10th meeting of SECP held on 18-6-2010 new promotion policy was proposed. It was also stated that in 2009 appellant was not rated as High Potential but rated as "Assets" and his recommendation for promotion for previous year was withdrawn due to decline in his performance. It was also stated that promotions were approved in June 2010 but appellant was not approved for promotion. In fact no promotion in department of appellant was made. It was summarized that appellant's performance rating and potential rating were as under:--- 20072008 2009 Performance ratingGoodExcellent Very Good Potential rating AssetHigh PotentialAsset
8. In Miscellaneous Appeal No,16 of 2010 appellant is working as Deputy Director in BS-18. In the year 2007 her performance was rated very good and in 2008 her performance was rated excellent. In 2009 her performance is rated good. She stated that since her transfer she has not been given any work. She was also not promoted in the meeting of SECP held on 18-6-2010. It is prayed by both appellants that it be held that they stood promoted as Joint Directors with effect from July 1, 2009 in accordance with working paper as approved by the Commission in its meeting held on 20-5- 2009. Consequent directions and reliefs are also sought.
9. Mr. Abid S. Zuberi learned counsel for appellant in M.A. No,18 of 2010 made the following submission:
(a) Learned counsel referred to section 42(1) of the Securities and Exchange Commission of Pakistan Act, 1997 (hereinafter referred to as Act of 1997). And submitted that appellants are civil servants and in terms of subsection (2) section 42 of the Act they are to be deemed to be in the Service of Pakistan.
(b) Learned counsel referred to section 40 of the Act and contended that power to make regulation has been conferred on the SECP but no such regulation have been framed so far, although government has repeatedly asked the SECP to frame regulations. Learned counsel in this regard referred to letter dated March 3, 2008.
(c) Learned counsel referred section 34 of the Act 1997 and section 7 of the Companies Ordinance, 1984 and submitted that appeals are maintainable.
(d) Learned counsel pointed out that present list is not a writ petition and, therefore, judgment of the Supreme Court in Pakistan International Airlines Corporation v. Tanveer-ur-Rehman (PLD 2010 SC 676) is not applicable to the present appeal. Learned counsel referred to judgment of the Supreme Court in Chairman SECP v. Muhammad Ashraf Gondal (Civil Appeals Nos. 305 and 306 of 2009) announced on 28-4-2010. Learned counsel also relied upon Walayat Ali Mir v. Pakistan International Airliness Corporation and another (1999 SCMR 650) and Fazali Rehmani v. Chief Minister, N.-W.F.P (PLD 2008 SC 769).
(e) Learned counsel extensively referred to performance, appraisal and potential assessment of the appellant to contend that exercise which resulted in denial of promotion to the appellant has been a manoeuvred exercise.
(f) Learned counsel submitted that appellant was recommended for promotion and the promotion was deferred in the meeting held on 20-5-2009 without a valid reason. He referred to the facts that bonus has been given to employees and salary increases have also been given. He submitted that he has to be promoted on the basis of assessment of 2008 and subsequent appraisal could not be taken into the consideration. He relied upon Amanullah Khan and others v. The Federal Government of Pakistan through Secretary, Ministry of Finance Islamabad and others (PLD 1990 SC 1092) and Abid Hassan v. P.I.A.C. And others (2005 SCMR 25).
10. Mr. Muhammad Umer Lakhani learned counsel for appellant in M.A. No,16 of 2010 on legal points adopted arguments of Mr. Zuberi and referred to performance appraisals etc. Of the appellant.
11. Mr. Makhdoom Ali Khan learned counsel for SECP made the following submissions:---
(a) The submissions are being made on merits without conceding that appeal is maintainable.
However, learned counsel did not argue aspect matter regarding maintainability of appeals.
(b) Learned counsel submitted that promotion is a multi tiered process culminating in final approval by the Commission and unless the Commission has approved, the fact that one level has recommended does not mean that appellant is entitled to promotion. When promotion policy was approved it was clearly stated that marks are mere threshold marks. The fact that an employee has crossed threshold would not mean that he is entitled to be promoted straightaway.
12. Learned counsel referred chronology of evidence and stated that on 12-10-2006 threshold marks for promotion to various categories were approved. On 14-2-2007 appellant applied for ex- Pakistan leave and thereafter on 27-9-2007 he applied for cancellation of ex-Pakistan leave with effect from October, 2007. Meanwhile, in June, 2007 appellant applied for the post of Joint Director.
On 20-11-2007 Potential Assignment Policy was approved by the Commission. However, the policy did not create vested right in any person who is assessed in any particular category for being promoted to the next level. On 22-3-2008 performance appraisal of the appellant for the year 2007 was recorded. His performance was rated "Good" and he was rated as "Asset" in terms of potential.
On 22-4-2009 a meeting of Commission was held. Deficit was noted and promotions for Deputy Directors and above were decided to be delayed for a period of 6 months to one year and it was also decided that promotions should be restricted that year and no promotion above the level Deputy Directors should be made. It was also decided that if revenue improved promotion issue may be revisited in the midterm view to be held in January, 2010, On 18-5-2009 43rd meeting of the Policy Board was held. The Chairman stated that as a result of liberal promotion policy adopted by the Commission over the last few years the Commission had become a top heavy organization.
Therefore, Policy Board decided that promotions upto the level of Deputy Directors may be finalized and promotions of Deputy Directors and above may be deferred till position of revenue improves.
Consequently, on 21-5-2009 promotion of officers upto level Assistant Directors were approved and it was also decided that 15 per cent increase in basic salary on promotion shall be given to each promoted officer. On 23-12-2009 the Commissioner (Law) submitted paper referred to in Para 4 above. This paper was considered in the meeting of Commission held on 19th and 20th of January, 2010 and the decision referred to in Para 2 above was recorded. On 9-4-2010 performance appraisal of appellant (Very Good) was recorded and on 21-4-2010 potential assessment of the appellant "Asset" was recorded (It was pointed by Mr. Zuberi that originally it was recorded as Proving Stage and then converted into Asset). On 18-6-2010 in a meeting of Commission promotions recommended in 2009 in respect of Management Cadre Employees were considered.
The cases of Management of employees who were recommended in 2008 but not in 2009 were also discussed and Commission agreed with composite recommendation made in assessment year 2009. It was in consequence of this subsequent decision that promotion order dated 1-7-2010 was issued and the appellants were not promoted.
13. Learned counsel submitted that there are no statutory rules. It is only a policy which is merely guideline. The policy has not been violated. Even if policy is violated it has no statutory force and, therefore, it cannot be enforced. In respect of section 34 of the Act of 1997 learned counsel submitted that it only changes the level at which decision is to be scrutinized but it does not change the law which remains law of Master and Servant. Learned counsel in this regard relied upon Ms. Zeba Mumtaz v. First Women Bank Ltd. And others (PLD 1999 SC 1106) and Ghiasuddin Shaikh and others v. Federation of Pakistan and others (2007 PLC (C.S.) 140).
14. On the question that no violation of policy has taken place and, therefore, appeals are not maintainable, learned counsel relied upon Anwar Hussain v. The Agricultural Development Bank of Pakistan and others (1992 SCMR 1112). Learned counsel further submitted that promotion is not a vested right and in this regard he relied upon Muhammad Aslam, A.S.I. v. D.I.G. Police, Faisalabad Range, Faisalabad and 10 others (2001 PLC (C.S.) 1298), The Chief Engineer, Irrigation, Lahore Zone, Old Anarkali, Lahore and others v. Sajjad Hussain Bhatti (2003 PLC (C.S.) 1153), Secretary, Government of Sindh Education Department and another v, Syed Riyazul Hassan Zaidi and another (1986 SCMR 64) and Abdul Hameed, v. Ministry of Housing and Works, Government of Pakistan, Islamabad through Secretary and others (PLD 2008 SC 395).
15. With reference to the case of Muhammad Ashraf Gondal (supra) learned counsel submitted that it appears that the Supreme Court was not properly assisted.
16. There is no mala fide. In any case mala fides have to be properly pleaded and established. The promotions have been granted by Commission unanimously. If an employee is placed in Proving Stage, neither it bars his promotion nor guarantees his promotion, Learned counsel referred to Page 125 in the Appeal No,16 of 2010 and submitted it is not proper appraiser: it is merely written "as appraised by the outgoing Chairman". Learned counsel referred to Muhammad Mubeen-Us-Salam and others v. Federation of Pakistan through Secretary, Ministry of Defence and others (PLD 2006 SC 602) and contended that scope of interference in Appeal under section 34 is very limited.
17. While exercising his right of reply Abid S. Zuberi submitted that policy under which he was assessed is policy of 2007. He submitted that appellants had legitimate expediency as, they had been recommended for promotion and promotion as merely deferred for a period of 6 months and, therefore, fresh exercise or subsequent appraisal could not be used as basis for denying promotions to the appellants. Learned counsel relied upon Sui Southern Gas Company Ltd v. Engr.
Naraindas and others (PLD 2001 SC 555) and Dr. Muhammad Amjad and another v. Dr. Israr Ahmed and others (2010 SCMR 1466). Umer Lakhani filed a statement on behalf of appellant in Court which referred to certain newspaper clippings.
18. We have considered the submissions made by the learned counsel and have also gone through the record.
19. Mr. Makhdoom Ali Khan submitted that policy has not been violated and even if policy is violated since it has no statutory force and is merely in the nature guidelines meant for internal, guidance of its officers and does not confer any right enforceable at law, this appeal is not maintainable.
Learned counsel further argued that substantive law remains law of Master and Servant and, therefore even if appeal under section 34 is maintainable it merely changes the level and does not change substantive law. Learned counsel relied upon Ms. Zeba Mumtaz's case (supra). Appellant in that case was an employee of First Women Bank Ltd. And after calling of her explanation her employment was terminated by paying her in lieu of notice period. Since at that time section 2-A of the Service Tribunals Act was effective she approached Federal Service Tribunal and Federal Service Tribunal dismissed her appeal on three counts which were concurred by the Supreme Court:---
(i) She had been given an opportunity of explanation and thereafter employment was terminated;
(ii) She had received notice pay, therefore she was not an aggrieved person and;
(iii) her employment was governed by the law of Master and Servant and, therefore, Service Tribunal could have ordered her reinstatement.
20. Learned counsel also referred to Ghiasuddin Shaikh's case (supra). In that case employment was terminated by giving one month's pay in lieu of notice period. Service Tribunal dismissed appeal holding that since there were no statutory rules the employment was governed by law of Master and Servant. There is plethora of case law starting from Pakistan International Airlines Corporation reported in PLD 1978 Lahore 748 coming right upto the case of Pakistan International Airlines Corporation v. Tanveer-ur-Rehman (PLD 2010 SC 676) in respect of employment governed by the law of Master and Servant. However, all this case law is in respect of maintainability of constitutional petition when employment is governed by the law of Master and Servant there being no statutory rules. On, one hand there is case law of Ms. Zeba Mumtaz, Ghiasuddin Shaikh (supra), Riazuddin v. Pakistan International Airlines Corporation (PLD 1992 SC 531), United Bank Ltd. v.
Shamim Ahmed Khan (PLD 1990 SC 990) and Pakistan International Airlines Corporation v. Koural Channa (PLC 1999 (C.S.) 1539) where it has been held that Federal Service Tribunal even if it had jurisdiction could not order for reinstatement in view of substantive-law of being law of Master and Servant. On the other hand there is case-law of Managing Director Sui Sonthern Gas Company Ltd. v. Saleem Mustafa Sheikh (PLD 2001 SC 176), Sui Southern Gas Company Ltd. v. Engineer Naraindas and others (PLD 2001 SC 555), Farasat Hussain and others v. Pakistan National Shipping Corporation and others (2004 SCMR 1874), Abdul Samad and others v. Federation of Pakistan and others (2002 SCMR 71), Managing Director Sui Southern Gas Company's case reported in PLC 2003 (C.S.) 796 wherein it has been held that even if there are no statutory rules the Federal Service Tribunal in appeal can order for reinstatement of an employee. Later view also find support from United Bank Ltd's case (supra) wherein it has been held that even non-statutory rule can be implemented or enforced through Section 2-A of the Service Tribunals Act.
21. There is, therefore, distinction and difference between jurisdiction under Article 199 of the Constitution of the Islamic Republic of Pakistan and appellate jurisdiction conferred by statute on a particular forum. It is settled beyond any shadow of doubt that even if there are no statutory rules and therefore writ petition would not be maintainable, if an appellate forum is provided by law, since it is settled law that an appellate forum has same power as the original forum and it I merely taking the matter from a lower to a higher forum, therefore, if departmental authority has a particular power, it cannot be argued that the appellate forum is devoid of that power. Appellate Court merely steps into shoes of original forum, albeit at a higher pedestal than the original authority and, therefore, exercise all such powers as .Are the powers available to the original authority. Since the original authority has powers to reinstate or grant promotion, if appeal under section 34 is maintainable (to this we will revert later) High Court exercise of powers under section 34 can grant the relief which the departmental authority while acting on its own could have granted.
22 These are appeals under section 34 of the Act of 1997. Said section is in the following words:- "34. Appeal to the Court.-- (1) An appeal shall lie to the Court referred to in Part II of the Ordinance in respect of an order of the Commission comprising two or more Commissioners of the Appellate Bench.
(2) The appeal under subsection (1) may be filed within sixty days of the date of the decision and shall be accompanied by a fee of one hundred rupees."
23. It states that an appeal lies to the Court referred to in Para II of the Ordinance. Ordinance as defined in section 2(o) of the Act of 1997 means the Companies Ordinance 1984. Part II of the Companies Ordinance, 1984 comprises of section 7 to section 10. Section 7 deals with jurisdiction of the Courts, section 8 with Constitution of Company Benches of High Court, section 9 with procedure of Court and section 10 with appeal against the order of Court. Section 7 provides as under:- "7. Jurisdiction of the Courts.--- (1) The Court having jurisdiction under this Ordinance shall be the High Court having jurisdiction in the place at which the registered office of the company is situate: ' Provided that the Federal Government may, by notification in the official Gazette and subject to such restrictions and conditions as it thinks fit, empower any Civil Court to exercise all or any of the jurisdictions by this Ordinance conferred upon the Court, and in that case such Court shall, as regards the jurisdiction so conferred, be the Court in respect of companies having their registered office within the territorial jurisdiction of such Court.
(2) For the purposes of jurisdiction to wind up companies, the expression "registered office" means the place which has longest been the registered office of the company during the six months immediately preceding the presentation of the petition for winding up.
(3) Nothing in this section shall invalidate a proceeding by reason of its being taken in a Court other than the High Court or a Court empowered under subsection (1).
24. Section 7 of the Companies Ordinance determines jurisdiction of High Court and the jurisdiction of High Court is qua "registered office of the Company". Appellate jurisdiction under section 34 of the Act 1997' provides that appeal is to lie to the Court referred to in Part II of the Companies Ordinance, 1984 and Court referred in Part II has Court having jurisdiction where registered office of the Company is situated. Therefore what is contemplated by section 34 are orders of Commission passed in respect of Companies and not order of the Commission in respect of its on internal working or matters relating to officers or employees of the Commission.
25. In our view, Section 34 cannot be given any other interpretation and its applicability has to be limited to the orders of Commission in respect of Companies incorporated under the Companies Ordinance, 1984. Therefore, in our opinion these appeals are not maintainable before this Court and are liable to be dismissed on this short ground alone.
26. However, since we had heard learned counsel at considerable length, we deem it appropriate to advert to some other contentions by the learned counsel for the appellants. Learned counsel for appellants referred to section 42 of the Act of 1997 and Contended that persons employed by the Commission are in the Service of Pakistan. Section 42 is in the following words:--- " Public Servants- (1) The members, Commissioners , employees and other persons authorized to perform or exercise any function or power under this Act or rendering services to Commission as consultant or adviser shall be deemed to be public servants within the meaning of section 21 of the Pakistan Penal Code, 1860 (Act XLV of 1860).
(2) Save as otherwise provided by this Act and only for the purposes so provided, nothing therein contained shall be construed to mean that any person referred to in subsection (1) is or shall be deemed to be in the service of Pakistan or is to be regarded or treated as a civil servant."
27. Subsection (1) of section 42 states that Members, the Commissioners and employees and other persons. Authorized to perform or exercise any function under the Act of 1997 shall be deemed to be public servants within the meaning of section 21 of the P.P.C. Therefore, they are not to be regarded or treated as civil servant. Every civil servant is to be treated as public servant. However confers is not true. Subsection (2) states that except for the purposes specifically provided employees of the Commission are not to be deemed to be in the service of Pakistan and or not to be regarded or treated as a civil servants. There was no requirements of making a provision or creating exception as has been done under subsection (2) of section 42 had the employees of the Commission been civil servants or in the service of Pakistan. Moreover, under subsection (2) of section 3 Commission is a body corporate with perpetual succession and capable of suing or be sued in its own name. Since Commission is a body corporate it is a person separate and distinct from the Federal Government and employees of Commission are not employees of the Federal Government.
28. In Mrs. M.N. Arshad v. Naeema (PLD 1990 SC SC 612) Supreme Court considered question of creation of corporation and its legal effects. This case was in respect of employee of Islamabad College for Boys and the Supreme Court came to the conclusion that since Islamabad College for Boys was setup by a resolution of the Federal Ministry of Education run by Board of Governor of College, such resolution did not confer status of legal person on the college and, therefore, employees of the college were held to be civil servants. In the present case corporate status has been conferred on SECP by subsection (2) of section 3 of the Act of 1997 and, therefore, SECP is legal person created by an Act of Parliament and, therefore, its employees cannot be treated as civil servants or employees of the Federal Government.
29. The case of Muhammad Ashraf Gondal (supra) was also referred to. The facts of case were that the appellants were civil servants and their case for absorption in the Commission was considered and refused. Against such decline writ petitions were filed in the Lahore High Court which were allowed by the High Court. Commission being aggrieved by the order of the High Court filed intra- Court appeal which appeal was dismissed. Honourable Supreme Court allowed the appeal by holding that since appellants were civil servants, jurisdiction of High Court was barred by Article 212 of the Constitution. Case is clearly distinguishable because it was regarding absorption of civil servant in the Commission.
30. Main thrust of arguments of Mr. Abid Zuberi was that the case of appellants was recommended and they were considered in the meeting by Commission and in the meeting held on April 22, 2009 promotions of Deputy Directors and above were deferred. No material has been placed on record that the promotions were "approved and deferred." All that has been this placed before us is minutes of April 22, 2009 meeting where promotions were deferred, that means consideration for promotions was, deferred. Therefore at no stage the Commission approved promotions of the appellants. It merely deferred them on 22-4-2009 and not approved and "deferred" implementation of promotion. Therefore, whenever subsequently promotions were considered it was consideration for promotions and not mere decision on implementation of an earlier decision of promotions because such earlier decision was never made. Mr. Zuberi submitted that appellant was given High Potential Rating in 2008 which, according to learned counsel, was for mala fide reasons, lowered to "asset" in the next year. There is no controversy on the point that appellant's Potential Rating was assessed for 2007 as asset and for 2008 as and High Potential. A look at the policy shows that for promotions in respect of High Potential ratings the following is provided':-- "High Potential Officers
(a) High potential officers will be promoted within a period of 3 years depending on availability of suitable vacant positions.
(b) A maximum of 15% officers in very division/department can be assigned the rating of "High Potential."
(c) In case of non-available of suitable position, if a High Potential officer is not promoted until 3 years after being assigned the potential rating of "High Potential" for continuous 3 years, he/she may be provided with job enrichment and enhanced compensation/ awards."
31. Therefore, even if is assumed that appellants should have been rated as "High Potential" for 2009 or even if appraisal both for performance as well for Potential for 2009 is taken out of consideration, we are unable to read anything in the policy that a person rated with High Potential is automatically entitled to promotion. Had that been so there would not be on any occasion for putting up the case for consideration before Commission. Therefore, fact that appellant was granted High Potential for a particular year does not, ipso facto, without any consideration entitle him to be promoted to the next cadre and we have not been able to find out any provision compelling Commission to promote persons who have been granted High Potential at any given time. Promotion is not a vested right of an employee and this proposition is so well settled with no authority is required in respect of it.
32. Result of above discussion is that these appeals are not maintainable besides of they are also devoid of any merits. They are consequently dismissed. Listed applications are also disposed.