SHAFIUR RAHMAN, J.--- Leave to appeal was granted in these two appeals to examine whether the "general balance amount of the agent's commission which was lying in the accounts of taken over insurance companies is an abandoned property".
2. The factual background of these two appeals is that the appellant State Life Insurance Corporation of Pakistan (hereinafter referred to as the Corporation) came into existence as a statutory corporation under the Life Insurance (Nationalization) Order, 1972--President's Order 10 of 1972 (hereinafter referred to as the Order). Article 4 of the Order vested the management of all Insurers transacting life insurance business in the Central Government disvesting persons previously entrusted with such management. Article 15 transferred all assets and liabilities appertaining to the life insurance business in Pakistan of all insurers as from the appointed date to the Corporation. The general effect of such vesting of insurance business was that it shall be as of "full force and effect against or in favour of the Corporation, as the case may be, and may be enforced or acted upon as fully and effectually as if, instead of the insurer, the Corporation had been a party thereto or as if they had been entered into or issued in favour of the Corporation".
Article 20 laid a duty on every person having property appertaining to the life insurance business of an insurer to transfer it to the Corporation forthwith.
3. There were in Pakistan. Approximately 41 insurance companies carrying on life insurance business, mostly having their head offices in West Pakistan and Branches in East Pakistan. In 1975 was promulgated Abandoned Properties (Taking Over and Management) Act, 1975 (XX of 1975)
(hereinafter referred to as the Act). "Abandoned property" was defined therein in section 2(a) as hereunder:- "'abandoned property means any property, movable or immovable (including share in industrial units and firms; investments, deposits, policies of insurance and all other interests and rights in or to or arising out of any such property), belonging to a specified person and includes any such property sold or transferred to, or placed under the supervision or control of, any other person on or after the sixteenth day of December, 1971, but does not include any ornaments or wearing apparel or any cooking vessels or other household effects in the immediate possession of a specified person, not exceeding a total of rupees one thousand.' specified person was defined in clause (f) of section 2 as hereunder:-- specified person means a citizen of Pakistan domiciled in the territories which immediately before the sixteenth day of December 1971, constituted the Province of East Pakistan who has left or leaves or has expressed his desire to be taken out of, or to be allowed .To leave, the territories of Pakistan and includes a company registered in the said territories the registered office of which has not been shifted in pursuance of the Companies. (Shifting of Registered Office) Ordinance, 1972 (V of 1972)."
Section 3 of the Act vested all abandoned properties in the Federal Government on and from the sixteenth day of December, 1971, section 6 required its declaration andsurrender, section 7 authorised the Administrator appointed under the Act to take possession of the abandoned property, section 12 prohibited the transfer of abandoned properties, section 13 required confirmation of transfers already made by specified persons, section 14 made provision for filing of claim of interested persons and section 15 provided for appeals/revisions against the orders passed.
4. The Deputy Administrator of Abandoned Properties issued notices dated 13-4-1977 and 30-4- 1977 calling upon the appellant to furnish the following information With regard to the taken over insurance companies doing business in East Pakistan:-- "(1) Names of nationalised Insurance Companies of former East and West Pakistan;
(2) list of employees being its field staff of such companies who ceased to be Pakistani citizens on or after 16-12-1971;
(3) amounts due to each of such employees who were being paid regular percentage share out of premium received from different categories of policy-holders insured by such field staff;
(4) any other amounts like provident fund, company contribution, commission, etc., payable to them;
(5) said information be supplied separately for each nationalised Insurance Company with the list of its said employees and amounts due to them."
4. In response the appellant submitted two separate affidavits; one in respect of nine such insurers and one in respect of another insurer, as hereunder:-- "Sr.No, Name of the Insurance Company Total amount due to vast Pakistan Field Workers Under First Affidavit
(1) American Life Insurance Co. Ltd. Rs, 1,10,64525 Habib Insurance Co. Ltd. Rs, 1,579.56 New Jubilee Insurance Co. Ltd. Rs, 766.76 National Security Insurance Co. Ltd. Rs, 13,313.70 Oriental Mutual Life Insurance Co. Ltd. Rs, 4,894.54 Prudential Insurance Co. Ltd. Rs, 17,953.27 Cooperative Insurance Co. Ltd. Rs, 9,702.12 International General Insurance Co. Ltd. Rs, 31,109.57 Oriental Insurance Co. Ltd. Rs, 10,510.03 Under Second Affidavit: Rs, 34.737.25
(1) Adamjee Insurance Co. Ltd. Total: Rs, 2.00.478.83"
6. The Deputy Administrator after receiving these statements passed two separate orders; one on 3-9-1977 holding that the commission payable to the Field Staff (1128 workers) in respect of nine nationalized insurance companies amounting to Rs,2,00,478.83 was abandoned property and was to be dealt with under the Act; and the other on 21-9-1977 determining in a similar fashion that the amount of Rs,34,737.25 relating to 215 employees of one company (Adamjee Insurance Company Ltd.) was abandoned property and was to be dealt with as such. This adjudication was followed by a notice of demand dated 17-10-1977. The appellant invoked the appellate and revisional forums.
Provided tinder the Act but being not successful instituted two Constitution petitions.
7. The main contention of the appellant before the High Court was that these insurance companies were in fact maintaining their separate offices/branches in East Pakistan and West Pakistan. On account of the war and the imposition of the Defence of Pakistan Rules, the arrangement existing between the Insurance Companies and the Field Officers had got frustrated. It could not be enforced nor the liabilities of the Insurance Companies towards those Field workers/officers be taken over and discharged by the appellant.
8. The High Court on the question of law came to the conclusion that the definition of 'specified person and of 'abandoned property as reproduced above brought within its net the liabilities passed on under the statute to the appellant and it was in respect of it accountable to the authorities established under the Act. The Constitution petitions were, therefore, dismissed with no order as to costs.
9. Mr. Mansoor Ahmad Khan, Senior Advocate, the learned counsel for the appellant has in arguing the appeal urged before us without disputing the applicability of definitions of 'abandoned property and 'specified person that the liabilities in respect of such Field workers were in the form of a running account and the amount of commission due to them was not the net amount in fact due to them. Besides, according to the learned counsel, individual accounts of the specified persons or field workers were not maintained by these insurance companies at the principal office in West Pakistan wherefrom these amounts were payable. It was only the lump sum due on account of these East Pakistani Field Workers that was entered in the books of accounts and was conveyed. He has relied on the decision in Arab Bank Limited v. Barclays Bank (1954)2 All ER 226.
10. So far as the legal and jurisdictional aspect of the case is concerned, the High Court adopted the right course of first examining the jurisdictional fact prescribed under the Act by defining 'abandoned property and 'specified person'. The definitions provided therein do bring within their net the dues entered into and payable to Field Workers in East Pakistan who ceased to be citizens of Pakistan after declaration of independence by the Bangladesh Government and its recognition by our Government. Any amount due to such persons would be 'abandoned property and such persons would under the definition be classified as 'specified persons'.
11. As regards the questions of frustration of the contract, or the liability in view of the state of war, the applicability of Defence of Pakistan Rules or the taking over of the properties of the insurance companies located in East Pakistan by the Bangladesh Government, these are questions which do not touch the jurisdictional aspect of the matter. As between parties these factors would have been relevant and determinative in apportioning rights and liabilities, if a statute on the subject had not intervened. The statute completely takes over in a situation where the contracts get affected by a state of war, by appropriation of property and assets, and by non- recognition/recognition of Governments. It isstatute and its provisions which control thereafter the C liabilities and not the ordinary civil laws dealing with the contract between the parties.
12. The argument that the accounts have not been kept in proper form, or that the liability in respect of each specified person is not disclosed therein, or that it was a running account, makes no difference to the application of law though these factors may make difference to the ultimate financial liablility or burden to which the appellant can be put under the law. It cannot be said on the facts admitted that the liability of the Field Workers commission was not of the insurance companies or of its principal office and that the offices located in East Pakistan were such complete units as to discharge those responsibilities entirely by themselves, the Head Office being not accountable for them nor the branches accountable to the Head Office.
13. The case of Arab Bank Limited is of no assistance on the facts of this case because therein it is a different statute governing the situation which was taken note of and given effect to. An amount payable in a particular branch of a particular country could not be realized from the Head Office located in a different country when it amounted to violation of so many local and international laws in the field. Here, neither factually nor legally the position is analogous. The difficulty of working out the net due to each Field Worker can be resolved by having access to the claim and the record relating to it. It is for the appellant in that case to dispute the amount and not the right of the respondents to ask for it.
14. In the circumstances, we find that no case has been made out for interference in the Constitutional jurisdiction. Both the appeals are without merit and are hereby dismissed with no order as to costs.