' SALEEM AKHTAR, J.--The appellant by the leave of this Court has challenged the judgment of the Lahore High Court passed in writ petition filed by him whereby the same was dismissed.
2. The appellant being a registered voter at serial No, 271 of voters' list of Ward No, 1/2, Jand Khanzada of Tehsil Chakwal, filed a writ petition seeking a direction to call upon Mushtaq Ahmad Bhatti respondent No,1 to show under what authority he holds the membership of Zila Council, Chakwal from electoral unit ZC-A. The ground for objection is that respondent No, 1 is a regular employee of the United Bank Ltd. Which is wholly owned and controlled by the Federal Government and therefore he is disqualified to be candidate or member of Zila Council in view of Article 63 (1)
(i) of the Constitution read with section 21(1) (f) of the Punjab Local Government Ordinance, 1979.
The respondent denied the claim. By the impugned judgment the writ petition was dismissed.
Reliance was placed on the case of Inayatullah Narejo v. United Bank Ltd. 1988 CLC 1446 in which it was held that the banks notwithstanding the nationalisation continue to enjoy their status as legal entities and were independent of the Federal Government. Reliance was also placed on an unreported judgment of the Sindh High Court in Constitution Petition No,D-634 of 1984 (Taj Muhammad v. Provincial Election Authority of Sindh) in which it was held that the respondent in that case was not disqualified under section 37 of the Sindh Local Government Ordinance, 1979 as the nationalised banks are controlled by Pakistan Banking Council which is neither an organ of the Government nor a statutory body. It was further pointed out that petition for leave to appeal (C.P.
No,546-K of 1984) against it was dismissed by this Court.
3. The learned counsel for the appellant has contended that the judgment relied upon by the learned Judges in Chambers of the High Court are distinguishable and the bar as contemplated by section 21(1)(f) of the Punjab Local Government Ordinance, 1979, and Article 63(1)(e) of the Constitution does not entitle respondent No,1 to contest or to go and remain as member of the Zila Council, Chakwal. Section 21(1) ( id (f) reads as follows:-- "21. Disqualification of candidates and members.--(1) A person shall be disqualified to be a candidate or a member of a local council--
(e) if he is a salaried official of Federal or Provincial Government or of a Public or Statutory Corporation, a local council or other local authority and in case such an official has retired, a period of two years has not elapsed since his retirement; ' Explanation.--The expression 'salaried official' shall not be interpreted to include a Minister or Minister of State or Advisor in the Federal Government or a Minister or Advisor in the Provincial Government;
(f) if he for the time being is disqualified for membership of the Parliament or a Provincial Assembly under any law for the time being in force;
4. Section 21 (1) (f') refers to the disqualification for membership of the Parliament or a Provincial Assembly as contained in Article 63 of the Constitution, relevant part of which reads as follows:-- "63. (1) A person shall be disqualified from being elected or chosen as, and from being a member of the Majlis-e-Shoora (Parliament), if--
(e) he is in the service of any statutory body or anybody which is owned or controlled by the Government or in which the Government has a controlling share or interest;"
' By virtue of Article 127 the provisions relating to National Assembly including Article 63 have been made applicable to the Provincial Assembly as well. Therefore, Article 63 provides for disqualification for membership of Majlis-eShoora (Parliament) as well as the Provincial Assembly.
Section 21 of the Ordinance prescribes disqualification for a candidate or member of a local council. This means that if a person is covered by any of the specified disqualifications he cannot be a candidate, but if he has become a member and the disqulification continues and remains attached to him, he shall be disqulified from being a member. The third situation may arise when a person elected may incur disqualification after the election. In such a situation also the member shall be disqualified to remain as a member of a local council.
5. Now coming to the disqualification the objection is that respondent No,1 is an employee of the United Bank Ltd., which is a body owned or controlled by the Government or in which the Government has a controlling share or interest. It seems that the discussion in the impugned judgment has proceeded on the ground that the United Bank Ltd. Is an independent corporate entity controlled by the Pakistan Banking Council, another independent corporate entity and is therefore not under the control of the Federal Government. For such observation reliance was placed on Inyatullah Narejo and Taj Muhammad's cases where the entire discussion was on the point whether Habib Bank Ltd. Or any .Nationalised bank is not statutory body or a statutory corporation. With respect, we may observe that due and proper attention has not been paid to the provisions of the Banks Nationalisation Act, 1974, nor much emphasis has been laid on the language of Article 63(1)(e) which refers to the service in any body which is owned or controlled by the Government or in which the Government has a controlling share or interest. The pivotal word to be construed is "control". If any body, organisation or I corporation is under the control of the Federal Government, any person I employed in it stands disqualified from being a member or a candidate for the election to the Zila Council. The meaning of the word "control" was considered as used in Houses of Parliament and Provincial Assemblies Election Order (5 of 1977) in Ghulam Rasool v Muhammad Hayat PLD 1984 SC 385. At no stage this judgment was noticed by anyone, although it had direct bearing on the controversy.##TE# In this case also election to Zila Council, Attock, was under consideration, which was challenged, on the ground that Muhammad Hayat who had contested the election and was declared elected was a full time employee of the Pakistan Oilfields Ltd. And was therefore disqualified on the express words of clause (aa) of Article 10(2) of the Houses of Parliament and Provincial Assemblies Election Order, 1977, as incorporated in the Punjab Local Government Ordinance, 1979 by its section 21(1)(f), Various dictionary meanings were taken into consideration. Another judgment of this Court in Karachi Electric Supply Corporation v. National Industrial Relations Commission (PLD 1982 SC 113) was also noticed. After examining the principles of interpretation it was observed that the Court must place restricted meaning on the word "control" mainly because it being a provision for disqualifying a person from being elected to public office and therefore general, vague and very wide meanings cannot be attributed to it. It was observed as follows:-- "Control over persons and their affairs in the context of the dispute before us, may be either proprietary or regulatory. The source, scope and the nature of each of these two powers is materially different. The incidence of ownership is a right to possess, a right to use and enjoy a right, to consume or destroy or alienate the thing owned. The State, the Government, or the functionary of Government as an owner will normally be possessed of all such powers incidental to ownership. The regulatory power of the State is very dissimilar to ownership. As an inherent attribute of sovereignty and a necessary attribute of every civilized Government, the State is imbued with a power to promote order, safety, health, moral and the general welfare of the society.
In legal parlance it is called its police power. Business and occupations are subject to regulation under this power. Statutes intended to provide relief in an emergency depend for their validity on a proper exercise of this police power."
' Finally it was found that three out of eight Directors were nominees of the Government and the Government share in the company did not exceed 34.76% and it was held that the Government had no proprietary control as such and it was observed: "The plenary statutory and regulatory control of the Government by itself would not in the circumstances entail disqualification of the employee of a non-statutory, non-governmental company, undertaking or enterprise".
6. In the light of these principles we will now examine whether the Government has control over the nationalised banks. The Banks Nationalisation Act, 1974 was promulgated on 7-3-1974 and came into force at once and further that it was deemed to have taken effect on the first day of January, 1974. The Act shall have effect notwithstanding anything contained in any other law for the time being in force or any agreement, contract, award, memorandum or articles of association or other instrument. Section 4 provides that the Federal Government or a Corporation wholly owned or controlled by the Federal Government shall have the exclusive right to establish a bank. Now by amendment made in December, 1990, the Government may in public interest, permit establishment of a bank subject to such terms and conditions as may be specified. Section 5 provided that the ownership, management and control of all banks shall stand transferred to and vest in the Federal Government on the commencing day. It further provided that all shares in the capital of a bank held by persons other than the Federal Government or Corporations owned or controlled by the Federal Government or State Bank shall stand transferred to and vest in the Federal Government free from all trusts, liabilities and encumbrances. In respect of shares vesting in the Federal Government the shareholders were to be awarded compensation. The Federal Government or a Corporation owned or controlled by the Federal Government was authorised to sell all or any of its shares in the capital of a bank as may be determined, but the aggregate value of the shares shall not exceed forty per cent of the issued capital of the bank. Therefore, even after sale the Federal Government was to remain owner of the majority shareholding. All the persons holding office in any bank as a Chairman, Director or Chief Executive except those holding such appointment made by the Federal Government or the State Bank were removed from the office and they ceased to hold office. A Banking Council was constituted by the Federal Government by notification in the official Gazette and the council was a body corporate. The banks were to have a Board of Directors consisting of President and six other members to be nominated by the Federal Government to whom vested overall policy-making in respect of its operation. The Chairman, the members of the Council and the President and the members of the Board were to be appointed by the Federal Government and were to hold office during the pleasure of the Federal Government on such terms and conditions as approved. From these provisions it is clear that the entire shareholding of the banks' capital, assets and liabilities vested in the Federal Government. The banks were constituted having a corporate entity. So, was the Banking Council which controlled the banks, but the entire management and the machinery provided for running the banks and controlling them was directly under the control of the Federal Government. The Banks and the Banking Council both having separate legal entities were under the control of the Federal Government. Therefore, even if they had separate corporate entity, the control of the Federal Government was not lost or wiped out. The control was not regulatory in nature, but it was positive and proprietary in character. The Federal Government has right to possess and alienate the shares.
After the enforcement of privatisation policy the alicnaion of shares by the Federal Government is nothing but exercise of the proprietary control and powers over these banks.
' Having come to the above conclusion, in our view, the Government having ownership of the shares, appointing officials and functionaries, at its discretion and commanding management, has full control over the Banks. Respondent No,1 being an employee of such a bank was therefore hit by the disqualification. The appeal is therefore allowed with no order as to costs.