' NASIR ASLAM ZAHID, J.-This constitutional petition calls into question the impugned order, dated 7th July, 1975 passed by the Controller of Insurance, respondent in this petition, cancelling the insurance survey certificate for fire, marine and motor granted to the petitioner firm by the Department of Insurance, Government of Pakistan. It was further mentioned in the order, dated 7th July, 1975 that as the insurance survey certificate to the petitioner firm had been cancelled, the petitioner firm shall not undertake in Pakistan any type of insurance survey, assessment or adjustment of any loss in respect of general insurance business with effect from 14th July, 1975. The impugned order was passed by the Controller of Insurance under subsection (7) of section 44-A of the Insurance Act, 1938. The main ground on which the impugned order has been challenged is that no hearing was granted to the petitioner before the order was passed, which action violated the specific provisions of section 44-B of the Insurance Act, 1938. We have heard Mr. Kamal Azfar, learned counsel for the petitioner and Mr. S. M. Nurul Hassan, learned counsel for the respondent.
2. The petitioner, an insurance surveyor, has been carrying on business as such since 1958. In August, 1964, on account of a fire, some goods belonging to M/s. Zameer Jon Corporation (the insured) were destroyed/ damaged.
' The godown, where the goods were stored, was mortgaged with the Bank of America and insured with M/s. Union Insurance Company Limited. According to the petitioner, originally the insurance company had instructed another surveyor, M/s. Hashmi and Company, to survey the loss but since proprietor of Hashmi & Company was proceeding abroad, the insurance company appointed the petitioner to undertake the survey and ask Hashmi & Company not to continue with the survey. The petitioner conducted a survey of the loss on the instructions of the insurance company during October, 1964 and assessed the loss at Rs, 1,718.74. According to the petitioner, the claim was finally settled between the bank and the insurance company at Rs, 8,460. It appears that another report had also been given by Hashmi & Company, the first surveyor.
' The policy of the insurance continued an arbitration clause and the dispute was referred to the Sole Arbitrator, who gave his award on 8th July, 1966 assessing the loss at Rs, 25,129 and the amount payable at Rs, 16,663 being the difference between the amount awarded by the Sole Arbitrator and the amount paid by the insurance company to the bank. The petitioner has submitted that the said award of the Sole Arbitrator was based on the survey report of Hashmi & Company, which report, according to the petitioner, was self-contradictory, incomplete and otherwise not acceptable. The award dated 8th July, 1966 of the Sole Arbitrator came before the erstwhile High Court of West Pakistan, Karachi Bench, Karachi and learned Single Judge in Suit No, 36 of 1968 by judgment dated 31st October, 1969 upheld the award to the extent to which it assessed the loss suffered by the insured but the Arbitrator's direction to the insurance company to pay a balance of Rs, 16,669 to the insured was set aside.
' After more than 10 years of the survey report given by the petitioner, a show-cause notice, dated 3rd December, 1974 was issued by the Deputy Controller of Insurance to the petitioner in which it was mentioned that the petitioner had assessed the loss at Rs, 1,718.74, whereas the loss was surveyed by Hashmi & Company, who assessed the loss at Rs, 25,129 and the assessment of Hashmi & Company was upheld by the Sole Arbitrator in the award given by him on 19th July, 1966.
It was pointed out that the difference in the two assessments was Rs, 23,410.26. The petitioner was required to show-cause why the certificates granted to him under the Insurance Act, 1938, be not cancelled on account of the gross under-assessment of the loss. The petitioner gave a detailed reply, dated 22nd December, 1974 denying the charge that he had under-assessed the loss. In the reply the petitioner had stated that he had not been examined by the Sole Arbitrator, who had only examined Hashmi and whose survey report had been accepted. He asserted that his survey report was correct and desired that he i,e, Ishrat Hussain (proprietor of the petitioner) Hashmi and the insurance company be summoned by the Controller of Insurance and the various documents bearing on the subject were examined so that an independent decision could be taken under section 44-B of the Insurance Act, 1938, determining who was at fault.
3. It is an admitted position that no personal hearing was granted to the petitioner nor any one was examined and by the non-speaking impugned order, dated 7th July, 1975 the certificates of the petitioner were cancelled. It was contended by Mr. Kamal Azfar, learned counsel for the petitioner, that section 44-B required a hearing before the certificates of the petitioner could be cancelled and in any case as the petitioner had requested that he may be examined alongwith Hashmi and a representative of the Insurance Company, an enquiry should have been held in which the petitioner should have been associated and as this was not done, the impugned order is liable to be set aside.
' On the other hand, it was argued by Mr. S. M. Nurul Hassan, learned counsel for the respondent, that the law on the subject did not require a personal hearing and in reply to the show-cause notice the petitioner had given a detailed reply and after consideration of this reply, the impugned order had been passed. According to the learned counsel for the respondent, no illegality was committed by the Controller of Insurance in passing the impugned order. It was further contended that the petition itself was incompetent, as various adequate remedies were available to the petitioner. The other remedies available to the petitioner, according to the learned counsel for the respondent, were as follows :
(a) In the proviso to section 44-A (7) of the Act it is provided that in the event of cancellation of a certificate under the discretionary powers of the Controller under subsection (7), the Government may, upon an application made to it in that behalf, call for a report from the Controller and after considering such report and hearing the applicant, may give such directions to the Controller as may be thought fit.
(b) Under section 110 (i) (o), any person being aggrieved by an order of cancellation under section 44-A of the Insurance Act, 1938, can file an appeal against the order of cancellation to the Insurance Appellate Tribunal.
(c) Under section 114-B the Controller has to exercise the powers given to him by or under the Insurance Act, 1938, in accordance with such general or specific directions if any, as may be issued by the Government. It was contended on behalf of the respondent that the petitioner could have approached the Government for issuance of a direction to the Controller to restore his certificates.
4. We propose first to dispose off the preliminary objection raised on behalf of the respondent that the present petition is incompetent, as adequate alternate remedies were available to the petitioner. Insofar as section 114-B of the Insurance Act, 1938, is concerned, it may be observed that the said legal provision gives a power to the Federal Government to issue a general or specific direction. In our view, it does not provide for any remedy to a person, whose certificate has been cancelled. As A regards the appeal under section 110 (1) (o) of the Insurance Act, 1938, it is stated in para. 14 of the memo. Of the present petition that the petitioner had filed an appeal and also a stay application before the Insurance Appellate Tribunal. It is stated by Mr. Kamal Azfar, learned counsel for the petitioner, that the appeal has not yet been decided, although over 8 years have passed since the appeal was filed. It appears that no application had been filed by the petitioner before the Federal Government under the proviso to subsection (7) of section 44-A of the Insurance Act, 1938.
In our view, although the remedies provided by the proviso to section 44-A (7) and under section 110 (1) (0) of the Insurance Act, 1938, are alternate remedies but in the circumstances of the present case they are not efficacious and speedy remedies. In any case this petition was admitted to regular hearing on 12th July, 1975 and the interim stay granted on 12th July, 1975 was confirmed by order, dated 29th July, 1975 with the consent of the learned Deputy Attorney-General. If there was any objection to the maintainability of this petition, the same should have been taken at the earliest opportunity. This was not done. In fact after nearly 8 years a counter-affidavit has been filed. We are not inclined to uphold the preliminary objection.
5. The petitioner has been carrying on the business of insurance 'surveyor since 1958 on the basis of the certificates issued to him by the Controller of Insurance and the cancellation of such certificates debars the petitioner from carrying on his business. If in reply to the show-cause notice the petitioner had desired that he, Hashmi and a representative of the insurance company be examined to find as to who was at fault, it was necessary for the Controller of Insurance to have granted a hearing and also examined Hashmi and allowed the petitioner to cross-examine him, as apparently it is on the basis of Hashmi's survey report that the certificates of the petitioner were cancelled. 'I he proceedings against the petitioner for cancellation of his certificates on the ground of gross under-assessm ent of the loss were in fact quasi-criminal in character. The charge against the petitioner was that he had given a false report and by the impugned order the Controller of Insurance had in fact found that the petitioner had given a false report and consequently all the certificates granted to the petitioner were cancelled. In these circumstances, it was required that a personal hearing should have been granted to the petitioner and if he wanted to examine any witness, that opportunity should also have been granted to him. We also find that the impugned order is a non-speaking order inasmu ch as apart from referring to the fact that Hashmi had given a report and that the Sole Arbitrator, before whom the petitioner had not been examined, had upheld the assessm ent of Hashmi, no grounds or reasons are given for cancellation of the certificates of petitioner.
' Mr. S. M. Nurul Hassan, learned counsel for the respondents, relied upon two judgments of the Dacca High Court for the proposition that the petitioner was not entitled to any personal hearing.
The first case cited by the learned counsel is reported in Iqbal Hassan Mahmood v. Board of Intermediate and Secondary Education (1). In this case decision of the Dacca High Court was that there had not been any contravention of the principles of natural justice. The learned Judges of the Dacca High Court referred to the well-known dictum of the Supreme Court of Pakistan regarding the principles of natural justice in the case of University of Dacca v. Zakir Ahmed (2). In the Dacca case the petitioner, who had appeared in an examination, had challenged the decision of the Board cancelling his results and debarring him from appearing at the next examination. The Dacca case is clearly distinguishable from the present case, as in the Dacca case from the explanation submitted by the petitioner in reply to the show-cause notice, he had not asked for any personal hearing or for examination or cross-examination of any witness. The other case relied upon by the learned counsel for the respondents is reported in Tofazzal Hussain v. Province of East Pakistan (3).
In that judgment it was observed that failure to give an opportunity to show-cause does not always require that the impugned order is to be struck down and an ex post facto hearing constitutes sufficient compliance with rule of natural justice requiring affording of opportunity to show-cause. This case also does not help the respondents very much. The facts and point involved in that case are clearly distinguishable.
6. As we have found that the alternate remedies available to the petitioner under proviso to section 44-A (7) and under section 110 (1) (o) o the Insurance Act, 1938, were neither efficacious nor speedy, we are of t view that the present petition is not liable to be dismissed on the ground that alternate remedies were available to the petitioner. The impugned order, dated 7th July, 1975 is liable to be set aside, as firstly no hearing was granted to the petitioner and secondly the impugned order is a non-speaking order. We have already observed that in the circumstances of this case the petitioner was entitled to a personal hearing, as he had made a request that he should be examined.
7. Constitutional Petition No, 713 of 1975 is allowed and the impugned order, dated 7th July, 1975 of the Controller of Insurance is declared to have been passed without lawful authority and to be of no legal effect. The petitioner is entitled to costs.
(1) PLD 1968 Dacca 5 (2) P 1965 SC 90
(3) P L Q 1969 Dacca 589