1. ' This suit has been filed for recovery of Rs, 43,000.
2. ' The brief facts are that the plaintiff is son of late Jal Dubash who was an employee of defendant No,1 since October 1917. He was drawing a salary of Rs,1,000 per month at the time of his death. It is the case of the plaintiff that . He was admitted to the benefits of Provident Fund Scheme of the firm, bonus payable to the employee and Compulsory Insurance by the firm for Rs,40,000. All the employment and benefits formed part of terms of his service with the defendant No,1. It is the case of the plaintiff that the said deceased while in service and working in office of the defendant No,1 collapsed on 28-2-1973 and remained in hospital where he expired on 9-3-1973 and upon his death, the defendant No,1 made the following payments to the plaintiff:- {{TABLE}}
(a) Salary for the months of February and Mrach 1973. Rs,1,759.30
(b) Accumulated leave salary due. Rs,1,970.00
(c) Medical. Rs,2,813.75 Rs,6,543.05 {{TABLE}} ' The provident fund of the deceased together with interest thereon amounting to Rs,27,231.40 was paid to the nominee of the daid deceased Mrs. Nurgez R. Dubash wife of the plaintiff. The plaintiff claimed the amount of bonus for the period dated 30-9-1972 and 31-3-1973 amounting to Rs, 1,500 for each period viz. a sum of Rs,3,000. The amount of compulsory group insurance amounted to Rs,40,000 but the defendant neglected to pay the same. The plaintiff claimed the following reliefs:- -
(a) A sum of Rs,43,000 with due interest at 11% per annum with monthly rest from the date of suit till payment;
(b) Costs of suit;
(c) Any other/further/additional relief or reliefs which the Hon'ble Court may deem fit and proper in the circumstances of the case.
3. ' The defendants have denied the allegations made by the plaintiff. The defendants denied that the deceased while in employment with the defendant No,l was admitted to the benefits of compulsory and/or assured group insurance for Rs, 40,000 or any amount by the defendant's firm.
4. It is averred that in November, 1971 when the deceased was very old, sick and infirm the defendant No,1 decided to retire from his service. The deceased pleaded not to retire him and allowed him to come to office as at home especially having lost his wife it would not be possible for him to pass his time. In view of the past service and old relationship with the deceased the retirement notice was withheld and the deceased was allowed to come to office and it was agreed that from 1-12- 1971 the defendant No,1 was to be paid a total salary of Rs, 1,000 to the deceased. Being old and sick, as the deceased was, attended the office in the morning hours and used to go away in the afternoon at his discretion. It is also averred that during his employment before 1-12-1971 and till his death he was holding a managerial post. The deceased was Custom Incharge of the defendant No,1 and was engaged in performance of his duties independently, making decisions and giving orders by his discretion to the employees holding under him. It is averred that in the year 1972 when the Government introduced the group insurance scheme for the first time the defendant No,1 forwarded to American Life Insurance Company, a list of all their employees for obtaining a Group Insurance Policy. The dates of birth of the employees was not shown in the list as at that time this information was not available with the defendants. As he was more than 72 years of age was not covered by the policy issued by the Insurance Company. The plaintiff is not entitled to the reliefs claimed by him. On the pleadings of the parties the following issues were framed:-
(1) Has the plaintiff obtained a succession certificate? If not, is he entitled to sue and whether the suit is maintainable?
(2) Is the suit bad for non-joinder of the Insurance Company as a defendant?
(3) Whether the deceased was entitled to Group or compulsory Insurance under the terms of his service?
(4) Whether the defendants had insured the life of the deceased for a sum of Rs,40,000? If so, is the plaintiff entitled to recover this amount from the defendants?
(5) What amount of bonus was payable to the deceased?
(6) To what relief if any is the plaintiff entitled?"
5. The defendants did not press first issue. Issues 3 and 4, I shall take together. Determination of both issues depends upon interpretation 'of Standing Order 10-B of the West Pakistan Industrial and Commercial Employment (Standing Orders) Ordinance, 1968. It is advantageous to reproduce the relevant portion of Standing Order 10-B which reads as under: "10-B. Compulsory Group Insurance.--(1) The employer shall haveall the permanent workmen employed by him insured against natural death and disability and death and injury arising out of contingencies not covered by the Workmen's Compensation Act, 1923 (VIII of 1923), or the Provincial Employees' Social Security Ordinance, 1965 (W.P. Ordinance No,X of 1965).
(2) The employer shall in all cases be responsible for the payment of the amount of premia and for all administrative arrangements whether carried out by himself or through an insurance company.
(3) The amount for which each workman shall be insured shall not be less than the amount of compensation specified in Schedule IV of the Workmen's Compensation Act, 1923 (VIII of 1923).
(4) Where the employer fails to have a permanent workman employed by him insured in the manner laid down in clauses (1), (2) and (3) and such workman suffers death or injury arising out of contingencies mentioned in clause (1) the employer, shall pay, in the case of death, to the heirs of such workman; or in the case of injury, to the workman, such sum of money as would have been payable by the insurance company had such workman been insured.
(5) All claims of a workman or his heirs for recovery of money under clause (4) shall be settled in the same manner as is provided for the determination and recovery of compensation under the Workmen's Compensation Act, 1923 (VIII of 1923)."
6. ' Mr. Muhammad Naeem has contended that when Jal Dubash died there was no liability in law upon the defendants to effect insurance upon the lives of its workmen against the side of natural death. He placed reliance on the case of Messrs Dost Muhammad Cotton Mills Ltd., Karachi v. The Commissioner for 'Workmen's Compensation, West Division, Karachi and another (1980 PLC 248) and the case of Jannat Textile Mills Ltd. v. Commissioner, Workmen's Compensation, Hyderabad and another (1980 PLC 472). Mr. Muhammad Naeem placing reliance on these two Single Bench decisions raised an objection that the provisions of the Standing Order are not applicable to the facts of this case.
7. On the other hand Mr. Zaidi the learned counsel for the plaintiff has submitted that the case of the deceased workman is covered under the provisions of clauses (1) and (4) of Stnding Order 10-B of the Ordinance. In support of his submission the learned counsel has placed reliance on the decision of Division Bench of this Court in the case of Muhammad Siddique v. Sindh Labour Appellate Tribunal, Karachi reported in PLD 1979 Karachi 560 in which the Division Bench after review of a catena of authorities opined that clause (4) of the Standing Order 10-B if construed according to the sense of the Statute and the intention of the Legislature, would cover cases of natural death and disability referred to in clause (1).
8. ' In taking the aforesaid view the Division Bench relied upon the various judgments of Supreme Court and Court of Appeal.
9. ' I hold that in view of Muhammad Siddique's case (PLD 1979 Karachi 560) the Single Bench decisions of this Court in Messrs Dost Muhammad Cotton Mills Ltd., Karachi's case (1980 PLC 248) and Jannat Textile Mills's case (1980 PLC 472) is no longer good law. The heirs of the deceased Dubash are entitled to get compensation and the defendants are entitled to cover a natural death.
10. ' The plaintiff produced letter as Exh.5/6. By this letter he demanded the amounts of bonus declared for the period ending 31st March, 1973 and amount of compulsory group insurance. The defendant sent a reply dated 21-11-1973 (Exh. 5/7) and stated therein that the bonus for the period ended 30th September 1972 was to be paid to him in due course. The defendants also sent a letter dated 27-4-1973 (Exh. 5/8) stating therein that they were sending Group Insurance claim form and also stated therein that there is a specific clause of Group Insurance Policy "that an employee crossing the age of 59 years does not become eligible for the claim". The defendants forwarded the claim papers to the Insurance Company which were rejected by the Insurance Company.
11. ' The defendants examined Khalid Raza, Assistant Manager of defendant as Exh.
6. He stated in his deposition that deceased was employed as Assistant Manager of Custom's Section of the firm. There were 8-10 employees under him in the said section. All the employees of the firm were entitled to group insurance. The firm entered into an agreement with Insurance Corporation in respect of its employees. He produced group insurance policy as Exh. 6/1. He also produced list of employees who were covered by the group insurance scheme (Exh. 6/2). He also produced census sheet as Exh. 6/3 and letter of Insurance as Exh.6/4. He also produced claim form as Exhs. 6/5 and 6/6. He also produced the letter of Insurance Company deciding the claim as Exh.
12. 6/14. He further stated that on the basis of letter Exh. 6/14 the defendant had declined to pay the amount of group insurance to the plaintiff.
13. ' Mr. Muhammad Naeem the learned Counsel for the defendants has contended that the defendants are only entitled to insure its employees with the Insurance Company and to pay the premia on account of such insurance and thereafter the payment of the amount of group insurance is between the employee and the insurance company. This contention is devoid of force.
14. The defendants pleaded in their written statement that "in November 1971 when the deceased was very old, sick and infirm the defendants No,1 decided to retire him from service. The deceased pleaded not to retire him from service. The deceased pleaded not to retire him and allow him to come to office as at home especially having lost his wife it would not be possible for him to pass his time. In view of the past services and old relationship with the deceased the retirement notice was withheld and the deceased was allowed to come to office and it was agreed that from 1-12- 1971 the defendant No,1 will pay a total salary of Rs,1,000 to the deceased. Being old and sick, as the deceased was he attended the office in the morning hours and used to go away in the afternoon at his discretion". The defendants also pleaded that upto November, 1971 the deceased was drawing a salary inclusive of allowances at Rs,1,850 per month and a further allowance of Rs,5 per ship was also paid to the deceased. Khalid Raza in his cross-examination admitted that retirement of an employee is made under an office order of the firm. He also deposed that he was not in a position to produce any office order in respect of retirement of Mr. Jal Dubash deceased. He also stated that "I cannot produce any letter whereby the deceased was permitted to continue to work in the firm after his retirement. Nor can I produce any letter to show that after retirement he was allowed to work on contract basis." The burden was on the defendants to show that the deceased was retired in November, 1971 and thereafter he was working on a contract basis. This burden was not discharged by the defendants. It is an admitted position that an employee is retired under an office order but in the instant case no such office order was produced by the defendant. From this fact an adverse inference can he drawn that the deceased was not retired by the defendants and he was not re-employed on contractual basis. Mr. Muhammad Naeem the learned counsel for the defendants has placed reliance on voucher dated 26-9-1970 (Exh. 5/12). A perusal of the voucher shows that it was in respect of payment of retirement gratuity. The defendants pleaded in their written statement that the deceased was retired in November, 1971 as such the voucher dated 26- 9-1970 (Exh.5/12) does not help them. This voucher may be a receipt for a loan in lieu of gratuity. In view of this evidence it seems that the deceased was permanent employee of the defendant No,1.
15. ' The defendants pleaded that he was working as Assistant Customs Incharge of the defendant No,1 and was engaged in performance of his duties independently making decisions and giving orders at his discretion to the employees working under him. The plaintiff replied to a suggestion in cross- examination that he had no document to prove the terms and conditions on which his father was employed by defendant No,
1. He further replied that "from record of the defendant No, 1, I was given to understand that my father was Incharge of the Customs Section of the defendant No, 1 firm."
16. Khalid Raza stated in his deposition that the deceased was employed as Assistant Manager of Customs Section of the above firm. There were 8-10 employees under him in the above section. It is for the defendants to prove that the deceased was not a workman but he was holding a managerial post. The defendants did not produce the terms and conditions of employment of the deceased. The defendants produced list of employees (Exh. 6/2). A perusal of the list shows that the deceased was custom incharge and was not working as Assistant Manager as stated by Khalid Raza. It is an admitted position that the entire record was in possession of the defendants but they failed to produce. In the case General Manager, Hotel Intercontinental, Lahore and another v. Bashir A. Malik and others (PLD 1986 SC 103) the Honourable Supreme Court laid down the following dictum:-- "The test for determining the question whether an employee is a workman within the meaning of various statutes in the field of labour legislation is well-settled. The consensus of judicial opinion seems to be that it is the nature of the work done by the employee that would be the essential and fundamental consideration for determining the question and not his designation which is not conclusive. The question to be examined is whether manual or clerical work is incidental to the main work or a substantial part of it, so that, the fact that a person employed in a supervisory capacity does some manual or clerical work as ancillary or incidental to such employment has been held not to bring him within the ambit of the definition. The main features, the pith and substances of his employment must be manual or clerical before the definition is attracted."
17. Applying the above dictum to the facts of this case, it seems that he was not working at a managerial post in the absence of this relevant record as the defendants have not produced the relevant record but on the contrary adverse inference can be drawn against the defendants. In this view of the matter I am of the humble opinion that he was working as a workman. A perusal of clause (4) shows that when the employer fails to have a permanent workman employed by him insured in the manner laid down in clauses (1), (2) and (3) and such workman suffers death or injury arising out of contingencies mentioned in clause (4) the employer shall pay in the case of death to the heirs of such workmen, or in the case of injury to the workmen, such sum of money as would have been payable by the Insurance Company had such workman been insured. In the instant case the deceased was duly insured in the American Life Insurance Company (State Life Insurance Corporation of Pakistan) vide group insurance (Exh. 6/1). In the Policy under which the contractual parties are the defendant No, 1 and the State Life Insurance Corporation of Pakistan.
18. The remedy of the defendant No, 1 is against the Insurance Company as they can claim the amount of group insurance from the State Life Insurance Corporation of Pakistan and it is not for the plaintiff to agitate the same before the Insurance Corporation of Pakistan. The other aspect of the case is that deceased Jal Dubash was over 60 years of age and according to the terms of the policy (Exh. 6/1) the Insurance Corporation of Pakistan was absolved from 'payment of group insurance amount. In view of this, I am of the humble opinion that the defendant No,1 cannot be absolved from the liability as the deceased was permanent employee and according to clause (4) the defendant No,1 is directly liable to pay the amount to the permanent employee even though the defendant No, 1 had complied with the obligations as contemplated under Standing Order 10-B.
19. The non-joinder of Insurance Company does not help the defendant. The Issue No,3 is accordingly decided in favour of the plaintiff. In this view of the matter the suit is not bad for non-joinder of the Insurance Company. Accordingly, it is held that the suit is not bad for non-joinder of the Insurance Company.
20. Issue 5. The defendants conceded that the plaintiff is entitled to bonus for the period ending September, 1972 which comes to Rs,1,500.
21. ' Accordingly for the reasons stated above the plaintiff's suit is decreed for Rs,41,500 against the defendants jointly and severally with interest at 11% per annum from the date of the suit till payment. The defendants shall also be liable to pay costs of the suit.