AZIZ-UR-REHMAN, J.---Through the above High Court Appeal [in short HCA], the Appellant herein viz. Arshad Tanveer [Plaintiff in Suit No,1833 of 2016] while, feeling aggrieved and dis-satisfied with the 'impugned order' datedand March 2017, passed by a learned Single Judge of this Court on C.M.A. No,11782 of 2016, being an application under Order XXXIX, Rules 1 and 2, C.P.C. read with section 151, C.P.C. filed in Suit No,1833 of 2016 [Arshad Tanveer v. Sindh Industrial Trading Estates [Guarantee] Limited, inter alia is seeking setting aside of the 'impugned order' dated 2nd March, 2017. The prayer sought by the Appellant in the above High Court Appeal reads as follows:-- It is, therefore, most respectfully prayed in the interests of justice that this Honorable Court may be pleased to pass judgment and grant a decree in favour of the Appellants and against the Respondents jointly and severally in the following terms: [underlining is ours] A. SET ASIDE
(i) The Order dated 2 March 2017 B.RESTRAIN
(i) The Respondent No,1 from acting upon the First Notification.
C. DIRECT
(i) The Respondent No,1 to conduct the elections of the Respondent No,1 de novo D. GRANT
(i) Costs.
(ii) Any other relief that this Honourable Court may deem fit in the facts and circumstances.
2. The brief relevant facts diverged from the record seem to be that the appellant as being citizen of Pakistan and resident of Karachi, is an Industrialist and 'inter alia' carrying on his business in the name and style of Tanveer Dyeing and Bleaching Mills (Private) Limited, in Sindh Industrial Trading Estates [in short SITE], Karachi. Besides, the appellant, is a nominee for the position of the Board of Directors [In short BoD] of Respondent No,l.
3. Respondent No,1, is the Sindh Industrial Trading Estates [Guarantee] Limited, a company duly incorporated under the provisions of the Companies Ordinance, 1984, [XLVII of 1984]. As far as, Respondent No,2, is concerned, it is the Province of Sindh as per provisions of the Constitution of Islamic Republic of. Pakistan, 1973. Needless to say, Respondents Nos,3 and 4 were impleaded in the array of Defendants much after passing of the 'ad-interim' order on 20.08.2016, as per 'Amended Title' filed on 24.12.2016 i,e, pursuant to and in compliance with order dated 16.12.2016, passed in Suit No,1833 of 2016 which suit is still pending adjudication before this Court.
4. Like-wise, Respondent No,5 viz. Security Exchange Commission of Pakistan [in short SECP], it was joined in the array of defendants [as Defendant No,5], seemingly, in compliance with order dated 19.12.2016 passed in Suit No,1833/2016, filed by the Plaintiff/Appellant herein, for declaration and 'injunction' on or about 19.08.2016 with the following prayers:- "It is, therefore, most respectfully prayed in the interests of justice that this Honorable Court may be pleased to pass judgment and grant a decree in favour of the Plaintiffs and against the Defendants jointly and severally in the following terms: A. DECLARE
(i) That the First Notification dated 14 June 2016 (Annexure C) is arbitrary, capricious illegal and void.
(ii) That the Second Notification dated 14 June 2016 (Annexure D is arbitrary, capricious illegal and void.
B. RESTRAIN
(i) The Defendant No,1 from holding the elections of the Board of Directors in terms of either the First Notification dated 14 June 2016 (Annexure C) or the Second Notification dated 14 June 2016 (Annexure D)
C. DIRECT
(i) The Official Assignee of this Honourable Court to convene and supervise the elections of the Board of Directors of the Defendant No,1 in accordance with the provisions of the Memorandum of Association and Articles of Association and the provisions of the Companies Ordinance, 1984.
D. GRANT
(i) Costs.
(ii)Any other relief \ that this Honourable Court may deem fit in the facts and circumstances.
5. Along with the plaint, an application under Order XXXIX, Rules 1 and 2, C.P.C. read with section 151, C.P.C., was filed inter alia with a prayer for suspension of the Election of Board of Directors of Respondent No,1 [SITE] until, the final decision of the 'subject suit' No,1833/2016, is announced/passed. On 20.8.2016 while, issuing notice to the initially impleaded defendants only i,e, SITE and Province of Sindh (Respondents Nos,1 and 2 herein], in the meanwhile, 'Notification' dated 14.6.2016 [Annexure 'D' to the plaint at page 49 of the suit file Page 73 herein], which was/is relating to the 'retirement' of three [3] 'tenants members' and 'appointment' of three [3] 'tenant members', was also suspended till further orders. The relevant part of order dated 20.8.2016, passed in Suit No,1833/2016 for ready reference is reproduced herein below:--
20. 8.2016 Mr. Abdur Rehman for plaintiff x.x.x.x
1. Urgency application granted.
2. Learned Counsel submits that the defendants Nos, 1 and 2 in pursuance of the elections of Board of Directors have violated most of the Memorandum and Articles of Association of the company. He has relied upon Article 2 of Articles of Association which provides the number of General Body of 60 who are in fact eligible to elect both the official and non-official members of the Board of Directors. He then relied upon Articles 5 and 9 and submits that insofar as compulsory retirement of any director/member of the company is concerned, it could only be done by following a procedure laid down in the Memorandum and Articles of Association which has been violated while issuing one of the subsequent notification available as Annexure-D at page 49. Learned Counsel further submits that in terms of Article 30 of the Board of Directors eight directors are to be nominated by the Government of Sindh whereas, seven tenant members are to be elected by the members of the General Body which is in fact 60 and now in terms of the notification, available as annexure-C at page 47, has reduced to 25. Learned Counsel submits that official members are now excluded from participating elections of the tenant directors.
Counsel submits that in fact the entire general body i,e, 35 official members and 25 non-official members should take part in the election of the entire Board of Directors and as such the tenant directors are now facing the situation whereby the official members are not allowed to vote for them in terms of the notification available as annexure-C at page 47.
Let notice be issued to the defendants for 23.8.2016. In the meantime insofar as the notification dated 14.6.2016 available as Annexure-D at page 49, in relation to the retirement of the three tenant members and appointment of three other tenant members are concerned, shall remain suspended till further orders. [Underlining is ours)
6. Significantly, at the time of passing of the aforesaid 'ad-interim Order' of 02.08.2016, Respondents Nos,3, 4 and 5 herein, were not party[ies] to the suit. Nevertheless, while, keeping in view the aforesaid 'ad-interim order' and also to properly understand, the nucleus point of dispute it would be advantageous to reproduce the 'Notification' dated 14.6.2016, herein-in-below:- Government of Sindh Industries and Commerce Department Karachi, dated the 14th June, 2016 NOTIFICATION NO:EC(RO)/IV-65/94: With the approval of the Competent Authority, the Government of Sindh is pleased to direct that the following private tenant members of the General Body of Sindh Industrial Trading Estates Guaranteed Limited are hereby retired due to their old age:
1. Mr. G.R. Arshad, SITE, Karachi
2. Mr. Inam Illahi, SITE, Karachi
3. Syed Muhammad Hussain, SITE Hyderabad The Government of Sindh is further pleased to nominate the following members on the General Body of SITE Limited against the vacancies occurred due to retirement of above mentioned three private tenant members: [Underlining is ours] 1 Mr. Haroon Farooki, SITE, Karachi Mr. Younus Muhammad Bashir, SITE, Karachi
3. Mr. Abdul Razzak Agar, SITE, Karachi Mukhtar Hussain Soomro Secretary to Govt. of Sindh
7. Evidently, the 'ad-interim order' dated 20.08.2010, was only to the 'extent' and 'effect' of 'retirement' of three [03] 'tenant members' and 'nomination' of other three [03] 'tenant members' in terms of the aforesaid 'Notification' dated 14th June, 2014. Later on vide order dated 06.02.2017, passed in Suit No,1833/2016, by a learned Single Judge of this Court, the 'BoD' of SITE, was directed to fill-up the vacancies as required under law and thereafter, Election of SITE be also held insuring therein, the participation of Defendants Nos,3 and 4 [Respondents Nos,3 and 4 herein]. The Election to be so held, however, was made subject to Court's orders. Order dated 06.02.2017, passed in Suit No,1833/216 runs as follows:-- "It seems that quorum of the members who are required to vote in the elections is not completed by the Directors of the Board SITE which vacancies were made available on account of sad demise of 02 members out of 25. Let such steps be taken by the Board to fill-up the vacancies as required under law, where-after the elections of SITE may be held which may include participation of defendants Nos,3 and 4 subject to order.
As far as issue of composition of electoral office is concerned, this issue shall be resolved on the next date of hearing. Adjourned to 13.2.2017 at 12:30 p.m. [Underlining is ours].
Subject to the above direction, interim order to be continued.
8. On 13.02.2017, the issue of `composition of Electoral office', however, could not be resolved, as seen from and observed in order dated 06.02.2017, as seemingly, the suit was then, discharged. The relevant observations, nevertheless, made by the learned Single Judge of this Court in the 'impugned order' dated 02.3.2016 vis--vis the afore-mentioned 'Notification' of 14.6.2016 read as follows:-- "Insofar as the second notification attached as Annexure 'D' is concerned, it seems that the two vacancies, which were filled by the notification of even date, counsels have no objection in view of vacancies left by the two deceased members however it was agreed that it shall be subject to the elections of SITE, which may include participation of defendants Nos,3 and 4 as contesting parties." [Underlining is ours]
9. Per record, on 20.02.2017, when the Plaintiff/Appellant's 'injunction application' bearing C.M.A.
No,11782/ 2016, came-up before the Court, then upon hearing the learned counsel for the parties, the said 'injunction application' [C.M.A. No,11782/2016] under Order XXXIX Rules 1 and 2, C.P.C., was dismissed. The 'operative part' or the 'impugned order' dated 02.03.2017 reads as follows:-- "In view of the above, I am of the view that the plaintiff has not been able to ,make out a prima facie case; balance of inconvenience is also not in his favour and no irreparable loss would be caused to him and hence the injunction application in hand is dismissed."
10.The Appellant feeling aggrieved and dis-satisfied with the 'impugned order' dated 02.03.2017, passed by a learned Single Judge of this Court and now challenged through the instant HCA filed on 08.03.2017 with a prayer for setting aside the 'impugned order' and passing of a judgment and decree in favour of the Appellant. Needless to say, the instant High Court Appeal has been filed against the `impugned order' dated 02.03.2017 whereby, only the injunction application [C.M.A.
No,11782/2016] was dismissed inter alia for want of a prima facie case in favour of the Plaintiff/Appellant herein.
11.Upon filing of the above HCA, the learned Division Bench of this Court while, issuing notice to the Respondents on 09.03.2017, observed that the result of the election, however, will be subject to the order of this Court, if any. Order dated 9.03.2017, passed in the above HCA is reproduced here-in- below:- 09.03.2017 Mr. Abdur Rehman Advocate for Plaintiff .x.x.x.x
1. Granted.
2. Granted subject to all just exceptions.
3-4. Through instant High Court Appeal, the appellant has impugned the order dated 02.03.2017 passed by the learned Single Judge of this Court on C.M.A. No,11782/2016, whereby, the injunction application filed by the appellant has been dismissed. Learned counsel for the appellant has argued that while passing the impugned order, the learned Single Judge failed to appreciate that any amendment in the Memorandum of Article of SITE could be made only in terms of section 28 of the Companies Ordinance, 1984, after approval of the General Body, whereas, in the instant case, the impugned Notification(s) have been issued by the Government of Sindh in excess of powers, which did not vest in the Government of Sindh. Per learned counsel, the Electora College in respect of private tenan Directors has been amended b' reducing it to 25 private member only, instead of all the members a per company Law. Learned counsel for the appellant further submit that pursuant to impugned ordi the respondents have held the Elections of SITE merely on to (02) days' notice instead of 21 day prior notice in violation of time the provisions of Companies Ordinance, 1984.
M/s. Mansoor Ali Ghanghro and Zubair Ahmed Abro, have shown appearance waived notice and file Vakalatnama on behalf of the respondents Nos,1, 3 and 4, which are taken on record. They claim copy of instant High Court Appeal which the learned counsel for the appellant undertakes to supply before the next date of hearing. Learned counsel for respondents vehemently controvert the submissions made by learned counsel for the appellant and submit that the impugned order does not suffer from any error or illegality, as there is no amendment in the Memorandum of Articles made through impugned Notifications nor any right of the appellant or any private members has been effected through such Notification(s). It has been further contended by the learned counsel for the respondents that there has been no change or amendment in the Memorandum of Article of Association of the SITE through impugned Notification(s), it has been clarified that private Member will vote for private Directors, which provision already exists in the Memorandum of Article of SITE in terms of Article 2 read with Article 3(1)(vi) and (c) of the Memorandum and Articles of Association of SITE.
Let notice be issued to the remaining respondents to be served through first three modes for 22.03.2017. In the meanwhile, learned counsel for the appellant shall supply the copy of instant High Court Appeal to the learned counsel for the respondents Nos, ], 3 and 4, whereas, comments, if any, shall be filed by the respondents before the next date of hearing with advance copy to the learned counsel for appellant. However, the result of the Elections will be subject to order of this Court, if any. [Underlining is ours].
12.The above HCA when, came-up before us on 24.08.2017 then, we heard Mr. Abdur Rehman, learned counsel for the Appellant. Mr. Mansoor Ali Ghanghro, learned counsel for Respondent No,1 and Mr. Zubair Ahmed Abro, learned counsel for Respondents Nos,3 and 4 and also perused the relevant record minutely with their valuable assistance.
13.Mr. Abdur Rehman, learned counsel for the Appellant vehemently contended that the 1st 'Notification' No,ECL [RC]/V-65/94 dated 4th June, 2016 [Annexure 'C' to 'MoAs] was neither passed through and/or approved otherwise, by the Annual General Meeting [In short AGM] of private/`tenant members' of the Respondent No,1 [SITE]. Per Mr. Abdur Rahman, no any meeting, as alleged, was ever held either of the private 'tenant members' or of all the members at the Annual General Meeting, as such, the 'impugned Order' dated 2nd March, 2017, besides, being erroneous is liable to be set aside. The Appellant, however, did object to the 'minutes of the meeting', as and when the same were made available to Plaintiff/Appellant herein.
14.Mr. Abdur Rehman, learned counsel for the Appellant next contended that the power to amend Articles of Association, vests solely in General Body through General meeting of the company and not by Government of Sindh [In short GoS] otherwise. The actions taken on the part of GoS is clearly in violations of section 28 of the Companies Ordinance, 1984 [XLVII of 1984], hence in-valid. Per Mr. Abdur Rahman, such powers are vested in the members of the Respondent No,1 [SITE] which they, no doubt, are required to exercise in General Body Meeting of SITE. Moreover, the dictum laid down in the case of S. M. Munir and 3 others v. Government of Sindh and others 11996 CLC 370 (DB)), by the Division Bench of this Court, has not been appreciated in its' true perspective. In the cited case, it appears that a 'Notification' issued by Government of Sindh, whereby, two Additional Directors were appointed on the Board of Sindh Industrial Trading Estates [Guarantee] Limited, upon being found in violation of the Articles of Association, was 'struck down' by the 'Division Bench' of this Court. The relevant portion from the aforesaid case of S.M. Munir and 3 others v. Government of Sindh and others [1996 CLC 370 (Ker.)] reads as follows:- "...In such circumstances and in view of the above provisions of Memorandum and Articles of Association, the other 4 Directors had to be from public who are the present petitioners mentioned in the petition. Thus, it is obvious that having nominated the said 5 Directors on the Board of Directors, the Provincial Government could not have nominated any Additional Director which may have the effect to increase the number of Directors beyond nine. During the course of arguments the learned AA.-G. under instructions from the Deputy Director present in Court has submitted that the two Directors nominated by the Notification are Additional Directors. We are afraid this very statement on the face of it goes to show that the provisions of Memorandum and Articles of Association are contravened which the Provincial Government could not do unless the same are amended or the number of Directors is increased by a resolution passed in accordance with the provisions of the above Memorandum and Articles of Association. The respondent No, 3 also had no authority to nominee the Chairman in contravention of Article 52 supra.
In view of the above discussion we are of the view that the Notification issued by the respondent No, 3 bearing No, EC(AD-III)IV-44/92 dated 31-11993 is without lawful authority and accordingly we quash the same. The consequence of this declaration is that all acts and orders of the respondent No, 3 based on this notification or in consequence of this notification would also be rendered as a nullity in law in view of the principles laid down in the case of Yousuf All v.
Muhammad Aslam Zia PLD 1958 SC (Pak.) 104 as the subsequent acts and orders which are in the nature of super-structure built on the unlawful notification should fall down as a house of cotes."
[Underlining is ours] 15.Per Mr. Abdur Rahman, against Section 28 of the Companies Ordinance, 1984 [XLVII of 1984], no one can claim estoppel, merely on the basis of non-filing of any objections by Plaintiff/Appellant herein viz-a-viz the minutes of the meeting i,e, 410th AGM of BoD of SITE wherein the subject 'Notifications' were passed and approved, as ex-facie the same is/are, of no consequences.
Moreover, according to Mr. Abdur Rahman, 'Clause 3(1)(vi)(c)' of the 'Memorandum of Association' is in express in conflict of Article 2 of the Articles of Association of the Respondent No,1 [SITE], which Article not only clarifies but also fixes the 'quantum' of members of the Respondent No,1 at sixty [60]. Mr Abdur Rahman, next, urged that out of 60 members. 35 official members, have been illegally dis-enfranchised of their right to vote under the 1st. 'Notification' dated 14th June, 2016 [Annexure 'C' to the Plaint].
16.To see and appreciate clause 3(1)(vi)(c) of 'Memorandum of Association' [In short MoA], in juxtaposition of Article 2 of Articles of Association [In short AoA] of SITE, we would like to reproduce Article 3 of the 'MoA' and Article 2 of 'AoAs here-in-below as 'A' & '13'. respectively:-- A. "3. The objects for which the company is established are:
(1) To implement the provisions of Government Resolution No,24-1.B/ 47-1, dated 2nd June, 1947 set out below:
(i) Resolution.--- With a view to bring about industrial development of Sindh, Government are pleased to direct that a company called "The Sindh Industrial Trading Estates Company" should be formed to establish and manage trading estates at Karachi, Hyderabad, and Sukkur, on the following lines:.
(ii)The function of this company will be to acquire land for these trading estates, to lay out and develop such land by construction of roads and drainage and the provision of light and where either at the request of a particular trader or otherwise it appears to beK advantageous to do so, to construct and rent premises to traders. The company will make such charges for water and electricity supplied and for the rent of land and premises as to enable it to pay its expenses and interest at the rate not higher than 4 per cent on its capital outlay.
(iii)The company will not issue any shares to the public. If shares are required by law, they will be of the minimum amount possible and held by Government, unless under law, each Director must hold a certain minimum amount of shares. The company will make no profit or declare any dividend on its shares, if any.
(iv)Except as provided in the previous paragraph, the company will be financed solely by Government, through provision might be made for the issue, letter, of debentures.
(v)The Director will receive only fees for attendance at meetings, Government Officials, who are also Directors, will receive no fees.
(vi)The Director shall be:
(a) Ex-Officio, the Finance Secretary, Secretary Agriculture and Industries Department, and the Director of Industries.
(b)The Managing Director who will be a salaried Government servant, appointed by Government.
(c)Three representatives of the tenants of the Estate to be elected by them on the one firm one vote principle. [Emphasis supplied].
No member of the Sindh Assembly shall be eligible to become a Director
(vii) If the Managing Director of either of the ex-officio directors so desires, he may ask that a resolution passed by the Directors be suspen-ded pending a reference to Govern-ment in the appropriate department. On such reference Government may decide that the resolution shall have no effect or shall have effect in a modified form.
(viii) ..."
B. "2. The Company for the purposes of registration is declared to consist of 25 members, but the Directors may register an increase in the number of members whenever or as often as they think fit.
Board of Reso. Board increased the No,04. Dated 3rd number of members January, 1998 of General Body to 60 with 35 official and 25 non-official members."
[Emphasis supplied]
17. Mr. Abdur Rahman further argued that the powers to amend the resolution ratified in Clause 3(1)
(vi)(c) of the Memorandum of Association [MoA] in actual fact needs to be exercised by the members of the Respondent No,1 by amending Article 2 of the Articles of the Association [AoA] of Respondent No,1 which, as urged by learned counsel, prevails over the provisions of the Clause 3(1)
(vi)(c) of the Memorandum of Association [MoA]. Moreover, Respondent No,1 [SITE], did not derive its' power from Clause 3(1)(vi)(c) of the Memorandum of Association. While, concluding his arguments, learned counsel for the Appellant prayed for setting aside of the 'Impugned Order' dated 02.03.2017 and consequently allowing the HCA as prayed which also includes the 'prayer' for passing of judgment and decree.
18. Conversely, Mr. Mansoor Ali Ghanghro, learned counsel for the Respondent No,1 [SITE], argued that Respondent No,1 [SITE], has been established on 29th November 1947. i,e, pursuant to a resolution of the Government of Sindh, dated 16th May, 1947 [the Resolution] for promotion and growth of industrial development in the Province of Sindh. For and to achieve the said object/ purpose, Industrial and Trading Estates in Karachi. Hyderabad and Sukkur, were established. The 'Resolution', per learned counsel for SITE, was passed under the Constitutional powers conferred on the Province by the Government of India Act, 1935 [read with the Indian Independence Act of 1947], viz-a-viz. development of Industries and Trade. The powers, so conferred on the Province of Sindh [In short Pos] remained/being continued under the Constitutions of 1956, 1962 and 1973. The guidelines are contained in the Resolution, according to which, Respondent No,1 [SITE] to perform its' function as follows:--
(i) land would be acquired for the development of trading and industrial estates, to develop such lands by construction of roads and drainage, and by provision of light and to construct, whenever feasible, premises for purposes of renting them out to traders and industrialists;
(ii) power to levy rent for use of the land and premises let out and charge water and electricity charges;
(iii) no shares shall be issued and no profit shall be made or any dividends declared;
(iv) solely financed by the Government of Sindh;
(v) to be managed by a 'Board of Directors' consisting of (a) Secretaries to the Government of Sindh, and (b) representatives of the tenants of the Estate to be elected by the tenants on the one firm one vote principle; (vi)the Managing Director to be appointed by the Government of Sindh;
(vii) any resolution of the Board of Directors may be suspended pending a reference to the Government of Sindh at the instance of the Managing Director or any of the Ex Officio Directors, and, on such reference being made the Government of Sindh would be empowered to decide that the resolution shall have no effect or shall have effect with such mod(fications as may be approved by the Government. [Emphasis supplied].
19.Per the aforesaid 'Resolution', Lieut Colonel A.J.A. Beck, it appears was appointed 'Industrial Development Officers Managing Director' for to take necessary steps for forming the Respondent No,
1. The said 'Resolution' also provides a provision that the expenditure involved in the formation of Company [SITE] should provisionally be debited to the head "Industries", and that the expenditure for the current financial years, 1947-48 be met through a supplementary demand. For the next financial year, the Resolution has provided for necessary provisions in the budget estimates in consultation with the Director of Industries, Government of Sindh.
20.Manifestly, the 'Articles of Association' or the Respondent No,1 [SITE], contained the same provisions as are/were incorporated in the Sindh Government's Resolution. Pursuant to the Resolution, the Board of Directors was so constituted that at all times the Directors appointed by the Government of Sindh to remain in majority. Further, the Managing Director, is to be a salaried officer of the Government of Sindh. The Sindh Government, instead of discharging its' Constitutional functions for the development and promotion of industries in the Province opted for formation of a no profit association' under the erstwhile. Companies Act, 1913. Moreover, the Government of Sindh clothed the activities entrusted to it under the Constitution for the development of Trade and Industries in the Province with a 'corporate' personality, i,e, a no profit's association.
21.Per Mr. Mansoor Ali Ghanghro, learned counsel for Respondent No,1, Respondents Nos,3 and 4 being the 'tenants members' of the Respondent No,1 [SITE] and, indeed, are entitled to contest elections for seats of 'private tenant directors' in accordance with the Articles of Association. The Respondent No,1 [SITE], no doubt, has already acted in accordance with law and its Articles and Memorandum of Association. The Respondent No,5, it is needless to say, is not empowered to regulate or otherwise, govern the Respondent No,1, as SITE/Respondent No,1, is a Department of the Government of Sindh. Per learned counsel, 'official members' are nominating and suggesting the names of the 'official directors', whereas, the private members vote for private 'tenant directors'. As seen there is no conflict as alleged. The second Notification dated 14th June, 2016 in no manner, as alleged, is in violation of law and/or Articles and Memorandum of Association. Respondents Nos,1 and 2, as alleged, have never 'handpicked' or can handpick otherwise, any private members. The approbating and reprobating, it appears, is the habit of the Appellant.
22. The Appellant, as seen has no objection if, Respondents Nos,3 and 4, are appointed as 'private tenant directors'. Moreover, all the 'tenant members' were not only aware but also well informed of the two 'Notifications' and election schedule. Per Mr. Mansoor Ali Ghanghro it is absolutely incorrect that '35 official members', have forcibly restrained from voting. This if is the case, then why those 35 official members did not approach this Hon'ble Court or the Government of Sindh for redressal of their grievances if any. The allegations, so leveled, per Mr. Ghanghro, are a figment of the appellant's imagination. It is logical and reasonable if 'tenant members' vote for 'tenant directors', as the 'tenant members' are in a best position to raise voice in respect of their grievances and issues, if any. No person, legally entitled to vote was ever removed, as alleged, by the Appellant. The Appellant/Plaintiff is the only tenant member who levels such allegations in a calculated manner with a mala fide intention.
23.Per learned counsel for Respondent No,1 [SITE], the Articles and Memorandum of Association of the Respondent No,1, are not in contravention of any law as alleged, by the appellant. The allegations and pseudo pleas raised by the Appellant are not only 'sham' but also call for the wisdom of the appellant. The 'subject Notifications', learned counsel urged, have not only been approved but also ratified by the Board of Directors [BoD] in its' 410th meeting held on 21st July, 2016 which meeting admittedly was also attended by the Appellant. Not only this, the Appellant, at no stage filed and/or raised any objections to said Notifications. Lastly, learned counsel forcefully submitted that the 'impugned order' dated '02.03.2016', does not suffer from any legal infirmities.
The same, rather is in accordance with law. The instant High Court Appeal besides, being not maintainable in law, is liable to be dismissed with punitive costs as contended by learned counsel for SITE.
24.Per Mr. Zubair Ahmed Abro, learned counsel for Defendants Nos,3 and 4 [Respondents Nos,3 and 4 herein], the BoD of the SITE in its' 410th meeting held on 21st July, 2016, has already approved the two 'Notifications' dated 14th June 2016. The Plaintiff/Appellant herein, in the 410th AGM of BoD besides, very much vocal did attend the 410th BoD's meeting but in his own wisdom did not raise any objection in respect of the said 'Notifications' issued by the Government of Sindh [In short GoS].
Rather to say, the Appellant out of his 'free will' accepted/agreed-upon the decision wherein, the said 'Notifications' were approved and passed. Per Respondents Nos,1, 2 and 3's stand the two 'Notifications' both dated 14th June 2016, have been issued manifestly, quite in accordance with law/various clauses of Memorandum of Association and Articles of the Association of SITE. Per Respondents Nos, 3 and 4's stand and keeping in view sub-clause (c) of clause (vi) of sub-Article
(1) of the Article 3 of the Memorandum of Association of the SITE, it is clear that 'Representatives' of the tenants of the Estate, seemingly, to be elected by 'tenant members' only and not by the 'official members', who before issuance of Notification dated 14th June, 2016, were not only in majority but also free in electing 'tenants representatives' of their choice. The referred clauses, in no event, as alleged are in conflict with any of the provisions of law. Rather, it determines, the number of Directors and right of vote for electing the Tenant Representatives.
25. Per Respondents Nos,3 and 4's version, on all the previous occasions, the blue eyed members of GoS, used to become private 'tenant directors' due to majority of the Official Members. The 'Notification' dated 14th June 2016, in fact did correct the mistake as being practiced in past election of 'tenant representatives' as it was seemingly against the 'wishes' and 'desires' of the 'tenant members'. The change thus brought in no manner has caused any prejudice to the Plaintiff/Appellant. The Plaintiff/Appellant, it appears, did conceal the passing away of deceased members occurred before filing of the Suit bearing No,1833 of 2016 [Arshad Tanveer v. SITE and others]. The members replaced were due to their old age and passive role in the affairs of the SITE.
The Plaintiff/Appellant herein, is/was well aware of the said two 'Notifications' as he was present in the 410th BoD meeting held on 22-07-2016 wherein the said two Notification were passed/approved. Item No,6, of the agenda as reflects, is relating/concerning the subject two Notifications, under challenge.
26. The decision that was taken in the 410th BoD meeting in terms of Item No,6 run as follows:-- "Item No,6 Fixation of date for holding meeting of General Body and election of Tenant Directors MD SITE Ltd.
Presented notifications issued by Government of Sindh regarding appointment of three Tenant Members i,e, Mr. Haroon Farooki SITE Karachi, Mr. Younus Muhammad Bashir SITE Karachi and Mr. Abdul Razzak Agar from SITE Hyderabad in place of Mr. G.r. Arshad and Mr. Inam Illahi Shaikh, SITE Karachi and Syed Muhammad Hussain from SITE Hyderabad.
MD SITE further said that as per the notification, the electoral college of Tenant Members of SITE Ltd., shall only be eligible to elect the private tenant directors, the directors so elected will be induced in the Board. The notification also mentioned that as required under Clause (b) of subsection (2) of Section 160 of the Company Ordinance, 1984, 25 percent of the total voting power must be present in a General meeting to elect the Private Tenant Directors, therefore out of 25 private tenant members the minimum pre-requisite quorum needed to elect private tenant directors in a meeting shall not be less than seven tenant private members. A list of 25 tenant members was also placed before the board for approval [Emphasis supplied]..
Decision It was decided that the meeting of the General Body of private tenant members be convened on 23rd August, 2016 for holding the elections of Tenant Directors of SITE Board, as per the notifications issued by the Government of Sindh issued vide No,EC(RO)/IV/65/94 dated 14th June, 2016 wherein three Private Tenant Members i,e, Mr. Haroon Farooki SITE Karachi, Mr. Yunus Muhammad Bashir SITE Karachi and Mr. Abdul Razzak Agar from SITE Hyderabad have been appointed in place of Mr. G.R. Arshad and Mr. Inam Illahi Shaikh from SITE Karachi and Syed Muhammad Hussain from SITE Hyderabad and in the light of another Notification No,EC(RO)/ IV/65/94 dated 14.6.2016 wherein the it has been decided that the electoral college of 25 Tenant Members of SITE Ltd. shall only be eligible to elect the private tenant directors, the directors so elected will be induced in the Board. The notification also refers Clause (b) of subsection (2) of Section 160 of the Companies Ordinance, 1984 according to which 25 percent of the total voting power must be present in a General meeting to elect the Private Tenant Directors, therefore out of 25 private tenant members, the minimum pre-requisite quorum needed to elect private tenant directors in a meeting shall not be less than seven private tenant members." [Emphasis supplied].
27.Heard.
28.Before proceeding further, it is worth to note that the above HCA though has been filed against the 'impugned order' dated 2.3.2016 [Annexure 'X' to the MoA] whereby, the injunction application under Order XXXIX, Rules 1 and 2, C.P.C. read with section 151, C.P.C. [C.M.A. No,11782/2016]. filed by the Appellant in his capacity as a Plaintiff in Suit No,1833/2016 [Arshad Tanveer v. SITE & Ors], was dismissed. The Appellant, however, despite pendency of the suit, has prayed for passing a judgment and decree in favour of the Appellant in this High Court Appeal. The prayer as sought in the above HCA besides, mis-conceived, misleading, calls for the wisdom of the appellant.
Moreover, in the already dismissed Injunction Application and its' supporting affidavit [CMA No,11782/2016], the Plaintiff/ Appellant has failed to raise and/or avoided to show the existence of three [03] important ingredients i,e, 'prima facie case', 'balance of convenience' and 'irreparable loss' in his favour. For and in view of this position as well the learned Single Judgeof this Court, of course, has properly refused the discretionary relief while, dismissing the injunction application [C.M.A. No,11782 of 2016] through the impugned order dated 2.3.2016. In this regard reliance can be placed on the case of Muhammad Abid and 2 others v. Nisar Ahmed (2000 SCM R 780). The relevant portion therefrom reads as follows: "....Even so, where plaintiff neither has a prima facie case, nor would suffer irreparable loss nor balance of convenience lies in his favour, as covered by Order XXXIX, Rules 1 and 2, C.P.C. nor the interests of justice, in contemplation of section 151, C.P.C. so warrant, it is a more appropriate exercise of discretion to refuse rather than allow the interim relief."
29. Not only this, the Appellant as Plaintiff has also failed to seek in suit any perpetual injunction and that too despite the legal position that no temporary injunction in absence of any prayer for perpetual in unction, can be granted. Regarding this aspect of the matter reference can be to the case of Sh. Irshad Ahmad v. English Leasing Ltd. and 6 others (2004 YLR 2700) wherein reliance has been placed on the case of Marghab Siddiqi v. Hamid Ahmed Khan and 2 others (1974 SCM R 519).
The relevant extract therefrom reads as follows:-- "....that the petitioner did not pray for the grant of the decree for perpetual injunction and the only relief claimed by the petitioner is regarding the grant of decree for declaration. It is true that ad interim injunction has also been prayed but the fact remain that no relief for the grant of decree of perpetual injunction was claimed in the suit. The learned Additional District Judge has rightly held that "it is settled proposition of law that in case permanent injunction is not claimed in a suit, temporary injunction cannot be granted", which findings are in consonance with the principle laid down in the judgment reported as Marghub Siddiqi v. Hamid Ahmed Khan and 2 others (1974 SCM R 519), wherein the apex Court of the Country, while dealing with the identical question of law, has held as under:--- "Apart from the question that in the present case the trial Court had exceeded its jurisdiction by deciding the question of the validity of the resolution finally it appears to us that present petition must fail, for, the ad interim injunction could not have been granted for two other very good reasons which have , unfortunately not been noticed by the Courts below.
The first is that in a suit where no perpetual injunction is claimed no question of granting ad interim injunction can possible arise. In the present case, the application for ad interim injunction should have failed on this ground alone.
Secondly ..."
Being guided by the aforesaid law declared, I am constrained to hold that as the petitioner did not claim the decree for perpetual injunction in the suit, therefore. the temporary injunction has rightly been refused by both the Courts below."
30.Moreover, from perusal of Article 2 of `AoA' it is quite clear that it is BoD who enjoys absolute power to increase the number of members and as per Board's Resolution No,4 of 3rd January, 1998, the Board had increased the number of members of General Body to 60 with 35 official and 25 'non-official members'/ 'tenants members'. Per record, it appears that the Elections of SITE were regularly held in the past. Nevertheless, before the last elections as announced to be held on 23.08.2016. Respondent No,2 [PoS] issued two Notifications both dated 14th June, 2016 i,e, the Notifications under challenge. The said Notifications as per Appellant's version are nothing but a direct interference in the functioning of Respondent No,1 [SITE].
31.Per 1st Notification dated 14th June, 2016 [Annexure 'C' to the MoA] only the electoral collegeof 'tenant members'/'non-official members' of SITE are eligible to elect the private/non-official tenant Directors who upon succeeding in the election, thereafter to be inducted in the Board of Director [BoD]. As far as the 2nd Notification dated 14th June, 2016 Annexure 'D' to the MoA] is concerned, ex- facie, the same pertains to the retirement of 3 tenant members i,e, [1]. Mr. G.R. Arshad, SITE, Karachi.
[2]. Mr. Inam Illahi Shaikh, SITE, Karachi and [3]. Syed Muhammad Hussain, SITE, Hyderabad on account of their old age and nomination of [1] Mr. Haroon Farooki, SITE Karachi, [2]. Mr. Yonus Muhammad Bashir, SITE. Karachi and [3]. Abdul Razzak Agar, SITE, Hyderabad as member on the General Body SITE Ltd against the occurred retirement of the above mentioned three [03] private tenant members.
32.Significantly, both the aforesaid Notifications issued on 14.06.2016 have been issued in pursuance of provision of Article 3(1)(vi)(c) of MoA of Respondent No,1 after passing and approval of the same 'Notifications' under Item 6 of the agenda in the 410th AGM of Board of Director held on 21.7.2016 in which meeting the Plaintiff/Appellant herein, was also present. The decision of General Body members of SITE in relation to private/tenant members has never been challenged by the Plaintiff/ Appellant herein and this factum is quite clear from the minutes of the meeting. Likewise, the Plaintiff/Appellant did not raise any objection as to the electoral college which otherwise, amounts to satisfaction of the Appellant on the decision taken in 410th meeting. For and in view of this position as well, the Plaintiff/Appellant herein, is not an aggrieved person. Moreover, the Sindh Industrial Trading Estate, it is needless to say, is a statutory body which is under the administrative control of the Industrial Department of Government of Sindh [GoS].
33.Manifestly, the Articles of Association [AoA] of Respondent No, 1 [SITE], contain the same provision as are/were incorporated in the Sindh Government's Resolution dated 16th May, 1947. The Respondent No,l. thus is nothing more than a department of the Government of Sindh as SITE operates as a department of Government of Sindh and performs its' essential functions entrusted to the Province of Sindh with regard to the development of trade and industries. The Respondent No,1 thus in discharge of its' functions has always acted in accordance with law, its' Articles of Association [AoA] and Memorandum of Association (MoA]. The allegation that Respondent No,1
[SITE] is involved in any alleged gerrymandering is not only false but also seems afterthought as both the Notifications dated 14th tune, 2016 besides, being genuine have been issued in accordance with law, AoA and MoA of Respondent No,1 [SITE]. The requisite qualifications in order to become a member of the general body are as follows:-- "5. No person shall be admitted as a member of the company, unless he is first approved by the Directors, and the 'Directors shall have full discretion as to the admission of person to membership. The Directors may from time to lime lay down the qualifications requisite for being admitted to the membership of the company and the terms and conditions on which a person shall be admitted to membership and the admission and to other fee (if any) payable by him.
Further Qualifications for membership of SITE Limited
(i) That a member must be a National of Pakistan
(ii) That a member must be a responsibleexecutive e . g. Managing Director, Governing Director or Chairman of a tenant company of SITE Limited.
(iii). That a member must be over 30 years of age.
(iv). That a member must have adequate knowledge of English.
34. Keeping in view the above position three [03] private tenant members, as per Notification dated 14th June, 2016, were retired due to their old age and 3 other members were nominated/ appointed on the general body of SITE Ltd. against the vacancies occurred due to retirement of 3 private members. In this regard the observations made in the impugned order dated 02.03.2016 i,e, Insofar as the second notification attached as Annexure 'D' is concerned, it seems that the two vacancies, which were filled by the notification of even date, counsels have no objection in view of vacancies left by the two deceased members however it was agreed that it shall be subject to the elections of SITE, which may include participation of defendants Nos,3 and 4 as contesting parties are appropriate. The grievance of the Appellant/Plaintiff thus was, if any, seems duly resolved in view of the observations made/recorded in view of no objection raised the counsel for the parties including counsel for the Appellant/plaintiff. The representatives of tenants of Estate/SITE indeed is/are to be elected by the members on the One Firm-One Vote Principle which apparently means that a private member L. eligible to cast one vote even if any private/tenant member having more than one plot or estate at Sindh Industrial Trading Estate Ltd [SITE].
35. Since, both the Notifications have been duly approved and ratified by the BoD in its 410th meeting held on 21st July, 2016, in which meeting it is important to note the Appellant/Plaintiff was also present but he failed and/or avoided to raise any objection on the said decision taken place in 410th meeting of BoD wherein, the two 'Notifications' both dated 14th June, 2016, were approved/ passed.
36. As far as the case law reported in 1996 CLC 370 and relied upon by the learned counsel for the Appellant is concerned, the same under the facts and circumstances of the case in hand besides being distinguishable is not applicable as in that reported case the question involved was pertaining to the appointment of Additional Directors without consultation of the BoD which, however, is not the case in hand.
37. For all the above on 24.8.2017 while, arriving at the conclusion that the impugned order dated 2.3.2016 besides, not suffering from any legal infirmities, needs no interference, the above HCA was dismissed by our short order dated 24.8.2017, however, with no order as to costs.
38.Foregoing are the detailed reasons for our short order dated 24.8.2017.
39.The above HCA thus stands dismissed.