1. SYED DEEDAR HUSSAIN SHAH, J. - According to petition, petitioner No.1 is a private limited company, incorporated under the laws of Pakistan jointly owned by two Government owned corporations, Pakistan National Shipping Corporation (PNSC) and State Petroleum Refinery and Petro Chemical Corporation (PERAC), whereas petitioner No.2 are the trustees of the Companies Profit Workers Participation Fund (hereinafter referred to as the Participation Fund) established by petitioner No.1 in 1985 under the provisions of Companies Profits (Workers' Participation) Act, 1968 (hereinafter referred to as the Act). According to Section 3 of the Act 5% of the petitioners' profits in each year were to be credited into the participation fund, which the petitioner No.1 started crediting the same, the moment they became liable to do so under the said Act. That under the Schedule to the Act any amount left out of the allocation of the fund as per provision of clause 4 of the Schedule is to be transferred to the fund created under the Act. That according to the Schedule of the Act, the amount in the Participation Fund can be invested or used by petitioner No.1. However, the income thereto is to be paid towards participation ' fund and is to be available for the benefit of the Workers as provided in the Act. That under Clause 2(2) of Schedule to the Act 100% of the annual income of the fund is to be distributed amongst the workers in proportion to their units of entitlement. That while distributing the income amongst the workers the question was agitated as to whether the interest accrued on the amount transferred to Government Welfare Fund was to be distributed amongst the worker or was to be transferred to Government Welfare Fund. That in or about 1985, legal opinion was obtained from M/s. Orr. Dignam & Co. Who in their advice stated "any interest income which is related to a return on units of entitlement which cannot be allocated to Employees must be transferred to the 1971 Fund of the Government." In view of the opinion referred to hereinabove, petitioner No.1 Started transferring the interest income accruing on such amounts as well to Government Welfare Fund and have credited the following amount to Government Welfare Fund:- FROM 1982-83 TO 1989-1990 YEAR INTEREST DATE PAID 1982-83 - - 1983-84 818.053 23.01.1988 1984-85 424,807 23.01.1988 1985-86 439,212 23.01.1988 1986-87 480,096 10.11.1988 1987-88 350,303 23.10.1989 1988-89 245,537 19.04.1990 1989-90 787,546 11.05.1991 Total: 3,545,554 The workers of petitioner No.1 protested to the payment of these amounts to Government Welfare Fund maintaining that 100% of the income is to be paid to the workers. That the petitioners upon verification from two other companies namely, M/s. Pakistan National Shipping Corporation and M/s. Sui Southern Gas Company Limited, came to know that the Worker's contention appeared to be correct inasmuch as these Corporations were paying 100% of the income from the fund to the workers. Consequently, petitioner No.1 approached thesame law firm in or about 1992 for a second opinion whereupon they furnished an opinion absolutely contrary to their previous opinion in the following terms:- "We would advice that the whole of the amount of interest accruing to the fund should be distributed to eligible workers, and no portion thereof should be paid over to the workers welfare fund."
2. Keeping in view the two different opinions from the same law firm petitioner No.1 approached the respondents through their letter dated 20.12.1993 and requested them for permission to adjust the excess amounts so paid in the Government Welfare Fund against the principal amounts to be paid into the fund in the future. The respondents denied the request of the petitioner to adjust the excess amounts towards Government Welfare Fund against the principal amount payable towards the welfare fund in future and in support thereof referred to their circular and to that of Institute of Chartered Accountants of Pakistan, which is based on the previous opinion of M/s. Orr. Dignam legal firm, whereby the interest income on amount allocated to welfare a'mounts were to be credited into Government Welfare Fund. That respondents have rejected the petitioner/ demand to permit adjustment of excess amounts paid against the principal amount into the Government Fund in future and furthermore are insisting upon maintaining the practice based on the opinion of the- legal firm referred to above. That petitioners have no other adequate, efficacious or expeditious remedy except to file the petition for the following reliefs:-
(a) declare that under the provisions of the Companies Profits (Workers' Participation) Act, 1968 the full interest income accruing on the amount allocated to the Workers' Participation Fund is to be distributed amongst the Workers and no part of such income is to be paid into the Government Welfare Fund.
(b) declare that the respondent's directions as per their letter of 19.04.1994 are void ab initio and of no legal effect.
(c) direct the respondents that an amount of Rs.3,545,554/- paid by the petitioners into Government Welfare Fund as interest income on amounts allocated to the Government Workers Fund be refunded to the petitioner No.2 alongwith interest at 10% per annum from the date that amounts were paid into welfare fund till the date of payment, or IN THE ALTERNATIVE petitioners be permitted to adjust the said excess amount of Rs.3,545,554/- alongwith interest as aforesaid against the principal amount payable by petitioners into the Welfare Fund in the future.
3. In support of petition, affidavit of one Rear Admiral M.Z. Shah, the Managing Director of the petitioners has been filed. Parawise comments on behalf of the respondents have been filed.
4. Moreover, counter-affidavit in reply to the petitioner's affidavit has also been filed by one Muhammad Ahmad, Section Officer, Labour, Manpower and Overseas Pakistanis Division (Labour Wing), Government of Pakistan. Re-joinder Affidavit to the counter-affidavit filed on behalf of the respondents has not been filed by the petitioners.
5. We have heard Mr. Shaiq Usmani, learned counsel for the petitioners who has contended that the decision of the respondents communicated through their letter dated 19.4.1994 is defective in law and is not maintainable. That Section 2(2) of the Schedule to the Act provides that the entire interest income on the amounts allocated to the fund is to be paid to the workers. That Act is a legislation with a specific purpose of conferring benefits on the workers, consequently a presumption can be drawn that legislature intended to give maximum benefit to the workers.
6. Learned counsel for the petitioner has referred to Constitution Petition No. D-682/1991, decided by a learned Division Bench of this Court vide its order dated 3.5.1994, in support of his contention.
7. Mr. Mubarak Hussain Siddiqui, learned D.A.G, as contended that under Section 3(b) of the Act, petitioner No.1 was required, subject to adjustment to pay every year to the Fund not later than nine months after the close of that year, 5% of its profits during such year where the accounts have been audited by the auditor appointed under Section 23(b) of the Industrial Relations Ordinance, 1969, to be assessed on the basis of such audit. Moreover under clause (2) of the section the petitioner No.1 was required to furnish to the respondent and the Board not later than nine months after the close of every year of account its audited accounts for that year duly signed by its auditor.
8. That on the contrary petitioner No.1 did not pay in time 5% of their profits towards workers' participation fund as required under Section 3 of the Act and did not furnish requisite information as required under the above Section for their financial year 1980-81 inspite of instructions to them from the respondent. That the actual requirements for establishment of existing board of trustees (petitioner No.2 in the office of petitioner No.1 were not made as required under Rule 3(1) and 3(2) of the Companies Profits (Workers' Participation) Rules, 1971. Whereas keeping in view Rule 3(1 )(a) and sub-rule (2) of the above Rules, petitioner No.1 was required to intimate to the respondents, the names, addresses and particulars of trustees, consisting of four representatives, two each from management of the petitioner No.1 and the other two from workers nominated by the C.B.A. That the trustees are not supposed to hold offices for two years under the Rules. Despite the above provisions the petitioner No.1 not only did not hold new election of the trustees of workers' participation fund but also did not intimate to the respondent, names, addresses and other particulars of the existing trustees. Under the circumstances the Board of Trustees i.e. Petitioner No.2 stands unjustified and unlawful. That petitioner No.1 neither paid within the specified period of nine months, 5% of their profits towards workers participation fund nor furnished to the respondent their audited accounts and other related information on its allocation and distribution for the accounting years 1982-83, 1983-84, 1984-85 and 1985-86 but they furnished the information on 28.1.1988 which is noncompliance on their part of the clause (c), sub-section (1) of Section 3 of the Act with the result that total left over amount of Rs.3,517,959/- under clause 4(d) of the schedule to the Act was transferred to Workers' Welfare Fund on 19.1.1988 which was delayed by more than 4 years vide their letter No. F&A/143/88. Similarly left over amount of Rs.3,185,847/- for the period 1990- 91 and 1991-92 was transferred to workers' welfare fund on 21.6.1994 which was not in consonance with Section 3(c) of the Act, whereas information for the years 1993 and 1994 has not been furbished by the petitioner No.1 so far. That the petitioners on their own accord did not avail of the remedy under Section 7 of the Act. That clause 5(a) of schedule to the Act relating to 100% distribution of the annual income of the fund, including capital gains in proportion to their units of entitlement is to be read in conjunction with its clause 4(d). That clause 4(d) of the schedule was substituted for the original text in the year 1972 by Ordinance No. IX of 1972 while sub-clause (a) of clause 5 remained the same as provided in the original Act No.XII of 1968. There was no provision in the original Act for deposit of left over amount in workers' welfare fund. That purpose of transfer of left over amount in the workers' welfare fund constituted under Section 3 of the Workers' Welfare Fund Ordinance, 1972 is to finance projects connected with establishment of Housing Colonies for workers, financing welfare schemes such as award of scholarships to workers' children, Jahez fund for their girls, grant of sewing machines to widows and bicycles to industrial workers. That sub- clause (d) of clause 4 of the schedule not only puts limits on payments of maximum amount of Rs.3000/- to workers at the time of distribution but also restricts their rights in respect of left over amount. That Government will be loosing quite a sufficient revenue coming to it every year in pursuance of provisions of Workers' Profit Participation Act which in all fairness is being used for the over-all welfare of the workers and their families. That the board of trustees with the intention of increasing amount of interest will use delaying tactics so that transferring of the amount allocated to the fund is delayed. Specially prayer 'C' of the petition referred to hereinabove involves factual controversies about the payment of the amount, non-payment delayed payment and excess amount which can be decided/adjudicated only through recording of evidence and production of necessary documents which exercise under the circumstances is not permissible by way of this Constitutional petition. That the decision of Constitution Petition 682 of 1991 decided by a learned D.B. Of this Court dated 3.5.1994 is not helpful to the petitioners' case inasmuch as relevant provisions of law contrary to the claim of the petitioner was not placed before the D.B. This special provision is contained in clause 4(d) of the schedule to the Act. Furthermore the learned counsel who appeared on behalf of the State candidly conceded to the grant of petition and did not support the impugned letter dated 22.9.1990 before the' learned D.B. And consequently the petition was allowed. it would be pertinent to reproduce relevant provisions of the Act and Rules referred to by the learned counsel for the parties.
9. Section 2(e) of the Act provides as under:- 2(e). "scheme" means the scheme set out in the Schedule, Section 3(b) provides as under:- S.3(b). "subject to adjustments, if any, pay every year to the Fund not later than nine months after the close of that year five percent of its profits doing such year."
10. Clause 2(1) of the Schedule reads as follows:- S.2(1). "Investment of Fund. - (1) The amount allocated or accruing to the Fund shall be available to the company for its business operations. The. Company may, however, request the Board to utilize the amount in the Fund and the Board may decide to so invest the amount."
11. Section 4(d) reads as under:- S.4. Distribution of benefits of workers.
12. S.4(d). Notwithstanding anything contained in this scheme, no worker shall, in any one year, be entitled out of the annual allocation to units exceeding rupees (three thousand) in value so far as such allocation is relatable to clause (b) of subsection (1) of Section 3. Any amount left out of the annual allocation after the units have been so allocated shall be transferred to the Fund constituted under Section 3 of the Worker's Welfare Fund Ordinance, 1971 (XXXVI of 1971).
13. No part of such amount shall be deemed to be included in the net asset value of the Fund established under this Act and no individual worker shall have any lien on this amount by virtue of holding any units.
14. Section 5(a) and (g) is as follows:- 5.5. Disbursement of benefits: The disbursement of the benefits from the Fund shall be as under:- S.5(a) 100% of the annual income of the Fund, including capital gains realized, shall be distributed each year to workers in proportion to their units of entitlement; S.5(g) A worker, in the event of his retirement, or, his nominated beneficiary, in the event of the worker's death (from whatsoever cause) while in the employment of the company, shall receive 100% of the net asset value of the units standing in the worker's name.
15. The Act provinces Model procedure for the maintenance of accounts of worker's participation fund.
16. Article 10 provides as under:- Distribution of Principal out of the Fund.
10. On retirement, leaving employment, death, disability, termination of employment etc. Or at the end of the period prescribed in paragraph 5 of the scheme (please see Schedule to the Act), the net asset value of the units held by the workers as at the commencement of the year during which such event occurs shall, subject to forfeiture provisions of the Act be paid out to the worker or his nominee as the case may be. it would also be in the interest of justice to refer to Section 7 of the Act which provides as under:- S.7(1) Any difference arising between the Board and the company relating to the administration of the scheme shall be reported to the (Federal Government) whose decision thereon shall be final.
17. S.7(2) All claims of a worker relating to the benefits of the scheme, whether against the Board or the company, shall be settled in the same manner as is provided for in the Payment of Wages Act, 1936, for the settlement of claims arising out of deductions from wages.
18. Section 8 of the Act further provides that:- The (Federal Government) may, by notification in the official Gazette, direct that all or any of its powers functions under this Ordinance may, subject to such limitations, restrictions or conditions, if any, as may be specified in the notification, be exercised or performed also by any officer subordinate to it or by any authority so specified.
19. We would like to reproduce the provisions of Companies Profits (Workers' Participation) Rules, 1971 referred to by learned D.A.G, which provides as under:-
3. Establishment of Board of Trustees. -- (1) As soon as possible (but not later than two months) after the establishment of Fund by a company, the company shall-
(a) intimate to the Federal Government the names, addresses and other particulars of the two persons nominated by the company to represent the management on the Board to be constituted for the administration of the Fund; and
(b) where there is no collective bargaining agent in relation to the company, hold elections amongst the workers to elect two of them to the Board by the method of single non-transferable vote:, Provided that, if a collective bargaining agent in relation to the company comes into existence subsequent to the elections, the elected representatives of workers shall cease to be trustees as soon as such agent has nominated two persons to represent the workers on the Board.
20. Sub-rule (2) says as under:- Sub-rule (2): As soon as possible after the result of the elections held under sub-rule (1) is available, the company shall intimate to the Federal Government the names, addresses and other particulars of the workers elected to the Board.
21. The learned D.A.G, has pointed out the official functions to be performed by the respondents under Section 6 of the Worker's Welfare Fund Ordinance:-
6. Purposes to which moneys in the Fund may beapplied. - Moneys in the Fund shall be applied to- -
(a) the financing of projects connects with the establishment of housing estates or construction of houses for the workers;
(b) the financing of other measures for the welfare of workers;
(c) the meeting of expenditure in respect of the cost of management and administration of the Fund;
(d) the repayment of loans raised by the Governing Body; and
(e) investment in securities approved for the purpose by the (Federal Government).
22. Considering the contentions of the learned counsel for the parties and the provisions of the Act, Rules and other relevant statutes referred to and reproduced hereinabove, it is clearly established that petitioners have not come to this Court with clean hands inasmuch as they themselves have not complied with the provisions of the Rules, specially Rule 3(1), 3(2)(a), 3(b) and sub-rule (2) of the Rules by which the petitioner No.1 was required to nominate and furnish to the respondents the names, addresses and other particulars of the trustees consisting of four representatives, two each from the management of the petitioner No.1 and two from the workers nominated by the C.B.A.
23. According to Section 3(b) of the Act, petitioner No.1 was required, subject to adjustments to pay every year to the Fund not later than nine months after the close of that year 5% of its profits during such year, where the accounts have been audited by the Auditor appointed under Section 23(b) of the Industrial Relations Ordinance, 1969, to be assessed on the basis of such audit. Under clause (c) of the above Section, petitioner No.1 was required to furnish to the respondent and the board not later than nine months after the close of every year of account, audited accounts for that year duly signed by its auditor which petitioner have miserably failed to furnish and have not complied with the provisions of the Rules and the Act. Section 7 of the Act reproduced hereinabove provides that if any difference arises between the Board and the company relating to the administration of the scheme the same shall be reported to the Federal Government whose decision thereon shall be final. The petitioners on their own accord have not approached the Federal Government which provides necessary' provisions for the decision of difference, if any. Clause 4(d) reproduced hereinabove clearly shows that no part of such amount shall be deemed to be included in the net asset value of the Fund established under this Act and no individual worker shall have any lien of this amount by virtue of holding any units. it is pertinent to state that clause 4(d) of the Schedule to the Act relied upon and reproduced hereinabove provides that any amount left out of the annual allocation after the units have been so allocated shall be transferred to the Fund constituted under Section 3 of the Workers' Welfare Fund Ordinance, 1971 which provides as under:-
3. Constitution of Worker's Welfare Fund. -- (1) There shall be constituted for the purposes of this Ordinance a Fund to be called the Worker's Welfare Fund.
(2) The Fund shall consist of-
(a) an initial contribution of ten Crores of rupees to be made by the Federal Government.
(b) such moneys as may, from time to time, be paid by the industrial establishments under Section 4 (and Section 4-A).
(bb) the amount transferred to the Fund from time to time, under clause (d) of paragraph 4 of the scheme set out in the Schedule to the Companies Profits (Workers' Participation) Act, 1968 (XII of 1968).
(c) voluntary contributions in the shape of money or building, land or other property made to it from time to time by any Government or by any person.
(d) income from the investments made and properties and assets acquired from out of the Fund.
(e) proceeds of loans raised by the Governing Body.
24. Moreover, sub-para (d) of Clause 4 of the Schedule not only puts limits on payments of maximum amount of Rs.3000/- to workers at the time of distribution but also restricts their rights over left over amount. If the contention of the petitioners for distribution of 100% income is accepted then each worker falling under Cat-1 to III in the petitioner's Company shall get more than the ceiling of Rs.1500/- existing during the period in dispute which would also tantamount to negating the spirit of the law and intention of the legislature emerging from the ceiling that has been laid down in Clause 4(d) of the Schedule referred to hereinabove.
25. Mr. Shaiq Usmani, learned counsel has referred to the decision of the learned D.B. Of this Court passed in C.P. 682/91. With due respect to the decision of the D.B. It would be entirely in the interest of justice and fairness to point out that provisions of Clause 4(d) of the schedule to the Act reproduced hereinabove were not pointed out before the learned D.B. Moreover relevant material was not placed by the learned counsel who appeared on behalf of the State and did not support the impugned order dated 22.9.1990 and conceded to the grant of the petition with the result that petition was granted. From the aforesaid facts, circumstances and the provisions of the Act we are of the considered opinion that decision of learned D.B. In the referred case is not applicable to the facts of this petition.
26. A bare reading/perusal of the provisions of the Act and Rules referred to hereinabove is very clear and shows that petitioners have not come to the Court with clean hands and they have not approached the concerned quarter for settlement of their disputes as required under Section 7 of the Act. Whatever has been stated above concerning the provisions of the Act, Rules. The decision of the learned D.B. Is quite distinguishable from the facts of this petition, In this petition as per prayer of the petitioners particularly paragraph 'C' of the prayer referred to hereinabove factual controversies regarding the amount, getting direction from the respondents for excess payment and the interest involved, show that these factual controversies in any case are not to be decided in the extraordinary Constitutional jurisdiction of this Court because for the settlement of above factual controversies evidence is to be adduced by the parties alongwith documents if any and these above controversies cannot be adjudicated through this Constitutional petition.
27. The upshot of the above discussion is that this Constitution petition is devoid of merits and substance and must fail. Accordingly the same is hereby dismissed alongwith listed application. revisions by the competent authorities. Therefore, it is advisable to consult the official sources or legal professionals for the most up-to-date and accurate information.