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1992 PLC 733

SHAMA ZARI INDUSTRIES (PVT.) LTD. vs REGISTRAR OF TRADE UNIONS, SINDH

Citation1992 PLC 733
CourtSindh High Court
Judge(s)Mamoon Kazi
ResultOrder accordingly

' These petitions are being disposed of by a common judgment as common questions of law have been raised therein.

2. The case of the petitioner in Petition No,52/91 is that the petitioner is public limited company. In 1987, with permission of the Labour Court, the petitioner had closed down its factory. Thereafter, the petitioner had given its various departments to independent contractors and the workers working in the petitioner's factory were employed by such contractors who have been impleaded in the said petition as respondents Nos, 2 to 6. According to the petitioner on the 20th January, 1991 respondents Nos, 2 to 6 had served notice on the petitioner informing it that they had terminated the employment contracts as it was not found feasible by them to operate the different departments at the rates agreed by the parties and after expiry of the said notices the services of the workmen employed by them were terminated with effect from 20-2-1991.

3. The case of the petitioner further is that after termination of their services by the respective contractors the workers formed a trade union under the name and title of "United Carpets Limited Mazdoor Union" and filed an application before the Registrar, Trade Unions Sindh (respondent No, 1) seeking registration of the said union. The petitioner was also informed in regard to the name of the office-bearers of the said Union by a telegram dated 23-2-1991 which was followed by a letter of the said date. The said trade union has been impleaded in the petition as respondent No, 7.

4. After receiving intimation in regard to formation of the said Union, the petitioner wrote letters to respondent No, 1 informing him that the office-bearers of the union were not the employees of the petitioner and respondent No, 7 had been registered by respondent No, 1 in violation of the provisions contained in sections 7(1)(d) and 7(2)(a) of the Industrial Relations Ordinance, 1969 but to no avail as respondent No, 2 was issued certificate of registration by respondent No, 1 on 13-3- 1991.

5. The petitioner thereafter wrote to respondent No, 1 bringing all the relevant facts to his notice and requesting him to conduct an enquiry into the matter and then recall the certificate of registration granted to respondent No,7 and in response the said respondent required certain information from the petitioner which was made available by the petitioner to the former. However, no further action was taken in the matter thereafter and hence the petition.

6. The facts of C.P. No, S-66/90 are also more or less identical.

7. It is pertinent to point out that none of the parties in the case filed any counter-affidavit, refuting the allegations made in the said petitions. However, respondent No, 1 has filed comments wherein it has been stated that proceedings under section 46(a) of the Industrial Relations Ordinance have been initiated before the Third Sindh Labour Court, Karachi against the petitioners in the said petitions by the Assistant Director -Labour and Conciliator as the respondent No, 3 (National Engineering Co. Pvt. Limited Mazdoor Union) had alleged that the services of the office-bearers had been terminated by the petitioner in violation of section 8(a) of the said Ordinance. A criminal complaint in this regard has also been filed against the petitioner before the said Court.

8. The case of the petitioners in C.P. No, S-59/88 is that the petitioners are a private limited company and were incorporated on 20-7-1982. The petitioners are also carrying on their business in a factory which is situated in Federal 'B' Area, Karachi and has been duly registered as a factory as defined in section 2(j) of the Factories Act, 1934. Shama Zari Industries Labour Union which has been impleaded in the petition as respondent No, 3 was the only registered trade union connected with the petitioners' establishment and had been certified as a Collective Bargaining_ Agent for their workmen under section 22(1) of the I.R.O. The petitioners and respondent No, 3 had also entered into an agreement in terms of section 26(1) of the I.R.O. On 20-2-1988 whereby certain benefits had been extended to the workers of the petitioner's establishment.

9. By a letter, dated 18-2-1988 the petitioners received information that another union under the name and title of "Noor Lace & Shama Zari Workers Union" had been formed by the workers connected with the petitioners' establishment as well as M/s. Noor Lace Industries Limited and they had applied for registration with the Registrar Trade Unions, Sindh. The said Union and the Registrar have been impleaded in the petition as respondents Nos, 4 and 1 respectively. Thereafter the petitioners immediately protested to the Registrar in regard to the registration of the said Union which, according to the petitioners, had offended against the provisions of section 3(a) of the I.R.O.

But nevertheless the Registrar granted Certificate of Registration to respondent No, 4 on 24-5-1988.

10. The petitioners are aggrieved because the petitioners have received an intimation from respondent No, 1 that respondent No, 4 had applied for determination of a. Collective Bargaining Agent and the petitioners had been requested to submit a list of the workmen employed by them.

The petitioners again objected to the registration of the said respondent but to no effect and therefore, the petitioners apprehend that respondent No, 1 would proceed with the holding of the referendum and perpetuate the illegality already committed by him by grant of Certificate of Registration to the respondent No, 4.

11. The circumstances under which C.Ps. Nos, S-72, 73 and 74 of 1989 have been filed are that the petitioners in the three petitions are joint stock companies and are distinct juristic persons under the law. The petitioners were informed by a telegram in regard to formation of a union (respondent No, 3) by employees of the three petitioners. The list of office-bearers supplied to the petitioners by the said telegram indicated that more than 25% of the office-bearers were outsiders and were not employed by the petitioners nor they were covered by the definition of "worker" under the I.R.O.

Therefore, according to the petitioners, respondent No, 3 has been formed by contravention of section 7(1)(d) of the I.R.O. Furthermore, according to the petitioners, the employees of all the said companies cannot form one union collectively because neither there is unity of accounts nor units of management nor there is anything common which may be considered a binding force among the workers. The grievance of the petitioners is that such objection was sent by the petitioners to the Registrar, Trade Unions/Joint Director Labour but to no effect. Respondent No, 3 has also contravened of section 7(2)(a) of the I.R.O. But notwithstanding such objections respondent No, 3 has been able to get a certificate of registration dated 29-3-1989 from respondent No,

1. The petitioners, therefore, have sought declaration that the Certificate of Registration granted to respondent No, 3 is illegal, ultra vires and ab initio without lawful authority. The petitioners are also aggrieved by the fact that respondents Nos, 1 and 2 have taken further steps on the application of respondent No, 3 for determination of Collective Bargaining Agent in the establishments run by the petitioners.

12. I have heard Mr. Munawar Malik, Mr. Abdul Hameed Puri and Mr. Rehan Aqeel, learned counsel respectively appearing in the aforesaid petitions and Mr. A.A. Mohammadally, learned Additional Advocate-General who has appeared on behalf of the respondents Nos, 1 and 2 in these petitions.

13. Mr. Munawar Malik, learned counsel for the petitioners in C.P. Nos, S-52/91 and S-66/91 has referred to section 7(2)(a) of the I.R.O. Which requires that "A trade union of workmen shall not be entitled to registration under this Ordinance (The I.R.O.) unless all its members are workmen actually engaged or employed in the Industry with which the trade union is connected". (The words within the brackets are mine). Learned counsel has also referred to section 7(1)(d) of the I.R.O.

Which further provides that the number of persons forming the executive which shall not exceed the prescribed limit and shall include not less than 75 % from among the workmen actually engaged or employed in the establishment or establishments or the industry from which the trade union has been formed. It has been pointed out that the petitioners, in fact, moved the Registrar, Trade Unions, Sindh for lodging a complaint before the Labour Court under section 10 of the I.R.O.

Indicating that the union had been registered by him in contravention of the provisions of the I.R.O.

For cancellation of the registration of the Trade Union but no action has so far been taken in the matter by the Registrar.

14. So far as Petition No, 59/88 is concerned, Mr. Abdul Hameed Puri has argued that respondent No, 4 cannot be formed by the employees of the petitioner as well as M/s. Noor Lace Industries as they are separate establishments. He has further argued that some of the members who are represented by respondent No, 4 are also members of Shama Zari Industries Labour Union, respondent No, 3 in the case, hence respondent No, 4 has contravened the provisions of section 3(a) of the I.R.O. Which provides that "Provided that no worker shall be entitled to be a member of more than one trade union at any one time."

15. The contention of Mr. Muhammad Rehan Aqeel before me has been that the three petitioners are separate and distinct legal entities and consequently, the Trade Union (respondent No, 3) which has been constituted by the workers of the said company is an illegally constituted body.

16. It may be pointed out that with the exception of C.Ps. Nos, S-52/91 and S-66/91, I find no force in any of the other petitions. So far as the said two Constitutional petitions are concerned, no doubt, there are factual controversies which cannot be determined by this Court in the exercise of its jurisdiction under Article 199 of the Constitution but section 10 of the 1.R.O. Which has been invoked by Mr. Munawar Malik, learned counsel for the petitioners provides that: "10. Cancellation of registration.--(1) The registration of a trade union shall be cancelled if the Labour Court so directs upon a complaint in writing made by the Registrar that the trade union has--

(i) contravened (or has been registered in contravention of) any of the provisions of this Ordinance or the rules; or

(ii) contravened any of the provisions of its constitution; or

(iii) made in its constitution any provision which is inconsistent with this Ordinance or the rules.

' The registration of a trade union shall be cancelled by the Registrar if, after holding such inquiry as he deems fit, he finds that such trade union has dissolved itself or has ceased to exist."

' It is the case of the petitioners that they informed the Registrar about the fact that the services of the workmen had been terminated by the contractors and they had ceased to be the workmen actually engaged or employed in the petitioner establishments but no action was taken by the Registrar, Trade Unions Sindh. It hardly needs to be pointed out that unless the workers who formed the union are actually employed in the establishment with which they are connected, the Trade Union would not be entitled to registration in view of the provisions contained in sections 7(2)(a) and 7(1)(d) of the I.R.O. When this fact was pointed out to the Registrar, it was incumbent on him to make proper enquiry into the matter. Admittedly no such enquiry was conducted by the Registrar notwithstanding the fact that the defect was pointed out to him. Under the circumstances, I have no hesitation in allowing the two petitions (C.Ps. Nos, S-52/91 and S-66/91) and directing the Registrar to conduct an enquiry into the matter and then act in accordance with section 10 of the I.R.O. If he is satisfied that the Trade Union (respondent No, 7) has been registered in contravention of the provisions of the I.R.O. Or has contravened the same.

17. So far as Petition No, C.P. S-59/88 is concerned, the contention of Mr. Abdul Hameed Puri is that the same trade union cannot represent the employees of the petitioner as well as M/s. Noor Lace Industries. The learned counsel further argued that registration of such union by the Registrar is ab initio illegal and void. It may be pointed out that a trade union may be formed by the employees of an establishment or a group of establishments or an industry as the case may be and there are no restrictions whatsoever contained in the I.R.O. In regard to formation of such trade unions (see section 6 (iv-a) and 6(iv-b) of the I.R.O.). Mr. Abdul Hameed Puri has not been able to point out any provision in the I.R.O. Which prohibits formation of a trade union by employed of a group of establishments or more than one establishment together. The first contention of Mr. Abdul Hameed Puri, therefore, has no force..

18.So far as the second contention of Mr. Puri that the trade union has contravened the provisions of section 3(a) of the I.R.O. As some of the workers which have formed respondent No, 4 are already members of respondent No,3, is concerned, no doubt, the proviso to section 3(a) does not permit workmen to be members of more than one trade union at any one time but in such a case although the Registrar can be moved to lodge a complaint with the Labour Court under section 10 of the I.R.O. But the mere fact that the trade union includes as its members some of the workers who are already members of another union cannot render the registration of the union illegal or void ab initio. Apart from that the question raised by the counsel is a mixed question of law and fact and therefore, no declaration as sought by the petitioner can be granted in its favour in any case. Consequently, although C.P. No, S-59/88 is dismissed, it is however, expected that the Registrar, Trade Unions, Sindh will himself conduct an enquiry into the allegations made by the petitioner since the alleged defect in the formation of the trade union was brought to his notice by the petitioner. In case, the allegations are established, it is expected that the Registrar shall act in accordance with the relevant provisions of the I.R.O. In this regard.

19. Turning now to the Constitutional Petitions Nos, 72/89, 73/89 and 74/89, as has been pointed out earlier, a trade union can be formed by the workers of a single establishment or a group of establishments. The mere fact that the workmen of all the petitioners have formed a single trade union cannot render their constitution illegal. The question whether the union has complied with the provisions of section 7(1)(d) of the I.R.O. Would also be determined in the light of the membership of workmen working in Noor Group of Companies jointly. Mr. Muhammad Rehan Aqeel has not been able to point out how the union, has been registered in contravention of either section 7(2)(a) or 7(1)(d) of the I.R.O. Under the circumstances, I find no force in these petitions and the same are dismissed. The parties are, however, left to bear their own costs.

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