1. ' SAIYED SAEED ASHHAD, J.---By this common judgment, we intend to dispose of the aforesaid Constitutional Petitions as question of law and facts and the circumstances involved in all these petitions are same.
2. ' The petitioners have filed these Constitutional Petitions to challenge the decision, dated 29-9-1993 of the Sindh Labour Appellate Tribunal in Appeals Nos,Kar-144 to Kar-151 of 1992.
3. ' The brief facts leading to the filing of the aforesaid Constitutional Petitions, as contained in the petitions, are that the petitioners were registered as a company in 1986 for assembling trucks and buses and for the purpose employed their own workmen, who had formed their union, which had been declared as C.B.A. And the petitioners had been entering into agreements with the said C.B.A.
4. For granting benefits to the workers employed by the petitioners permanently. It was further stated that some times, they engaged contractors for execution of certain works, in which case the contractors employed their own workmen for completing the contract works.
5. ' The petitioners further submitted that respondent No,3 in all the aforesaid Constitutional Petitions filed grievance applications stating therein that they were the workers of the petitioners and were terminated from service on 30-5-1989 by way of revenge as they had formed a Trade Union. As the petitioners did not remove their grievances, they filed grievance petitions before the IIIrd Sindh Labour Court stating therein the aforesaid facts and praying for reinstatement in service with, full back benefits.
6. ' The case of the petitioners was that respondents No,3 in all the aforesaid petitions were employed by contractor M/s. Al-Khair Services, who were given the contract for the purpose of manufacturing/construction of the bodies of the buses of several kinds i,e, Standard Bus, Delux Seat Bus, Delux Bus, Standard City Liner Bus and Standard A.C. Road Liner Bus as well as for manufacturing heavy commercial vehicles and for carrying on the job awarded to them, they had been given the right to employ their own workers, who had nothing to do with the employment of the petitioners' establishment and there was no relationship of employer and workmen between the petitioners and all the respondents No,3. They vehemently denied the allegation of termination of service of respondents No,3 on the alleged ground of formation of Trade Union and submitted that the application filed by respondents No,3 alongwith some other workers for registration of Trade Union in the petitioners' establishment was dismissed by the Registrar of the Trade Union and the said order was not challenged by respondents No,3 and other workers whose application for registration of the Trade Union was dismissed. It was further stated by the petitioners that the main ground on which the registration of the Trade Union was refused by the Registrar of the Trade Union was that all the respondents No,3 and other workers, who had formed the Trade Union, could not prove themselves to be employees of the petitioners and further submitted that the finding given by the Registrar of the Trade Union had attained finality as it was not challenged by the aforesaid respondents No,3 and other workers by way of appeal before the Labour Court in accordance with the provision of section 8(3) of the Industrial Relations Ordinance (hereinafter referred to as the Ordinance) and the respondents No,3 as well as other workers were precluded from challenging the same before the Labour Court in the grievance petitions filed by them.
7. ' The case of respondents No,3 is that they were employed by the petitioners at the time when it came into existence in 1986, but the petitioners with mala fide intention to deprive them of their legal rights available to them under the various labour laws, resorted to the ploy of engaging a contractor for the purpose of building/manufacturing of the bodies of the buses and other commercial vehicles and the workers, who were employed by the petitioners for carrying on the aforesaid manufacturing/building of the bodies of the buses and commercial vehicles, were put under the supervision of M/s Al-Khair Services, who were given a fake contract for carrying on the job of manufacturing/building of bodies of the buses and commercial vehicles while for all practical purposes, the work was being done and carried out under the supervisions of the petitioners. It was further submitted that a perusal of the contract entered into between the petitioners and M/s Al-Khair Services was sufficient to hold that it was a fake and bogus contract for circumventing the law so as to make out a case that the petitioners had handed over the job of manufacturing/building of bodies of the buses and commercial vehicles to M/s Al-Khair Services, who were required to employ their own workers/workmen for getting the job done, but the sole object of the above contract was to deprive the respondents No,3 of their rights and privileges available to them under the labour laws.
8. ' The Labour Court on the basis of the evidence adduced before it, came to the conclusion that respondent No,3 were the employees of the petitioners and not a labour contractor M/s Al-Khair Services. For coming to the above conclusion, the Labour Court had mainly relied on the statement made by the proprietor of M/s Al-Khair Services that when the petitioners appointed him as contractor for performance of aforesaid work, all the respondents No,3 were in the service of the petitioners. The second piece of evidence on which great reliance was placed by the Labour Court was that the petitioners failed to produce letters of termination of service of respondents No,3 before awarding contract to M/s. Al-Khair Services. The Labour Court further observed that production of appointment letters by M/s. Al-Khair Services in respect of the aforesaid respondents No,3 was absolutely immaterial and of no value in the absence of production of termination letters of all the aforesaid respondents No,3 in view of the provisions of Standing Order 12(3) of the Industrial and Commercial Establishments (Standing Orders) Ordinance (hereinafter referred to as the Standing Orders (Ordinance), which makes it obligatory for the employer to issue an order in writing explicitly stating the reasons for removal, retrenchment, discharge or dismissal of a workman from service. The Labour Court, however, did not allow the back benefits to respondents No,3 as it held that they had failed to prove that during the period, which had elapsed between the termination of service and order of reinstatement, they had remained unemployed and had not worked for gain. The petitioners being aggrieved and dissatisfied, filed appeals before the Sindh Labour Appellate Tribunal, who, by its order, dated 29-9-1993, upheld the order of the IIIrd Sindh Labour Court and dismissed the appeals filed by the petitioners. Again, feeling aggrieved and dissatisfied with the order of the Sindh Labour Appellate Tribunal, the petitioners have filed the aforesaid Constitutional Petitions.
9. ' We have heard the arguments of M/s. M.L. Shahani and Mr. Mirza Muhammad Kazim, the learned counsel for the parties, have perused the material available on record, the relevant provisions of law and the case-law relied upon by the learned counsel in respect of their respective arguments.
10. ' The question to be determined in these cases solely is whether respondents No,3 in all the aforesaid petitions were employed as workers/workmen by the petitioners or they were the employees of M/s AlKhair Services, a contractor, who had been entrusted by the appellant with the work of building/construction of the bodies of the buses and commercial vehicles. In this connections, the first contention advanced by Mr. M.L. Shahani was that all the aforesaid respondents No,3 had formed a Trade Union and had submitted an application to the Registrar of the Trade Union for its registration in the petitioners' establishment, but the same was refused by the Registrar of the Trade Union on the ground that they had failed to establish that they were the employees of the petitioners. Mr. M.L. Shahani further submitted that this order was passed by the Registrar of the Trade Union in exercise of his powers under section 8 of the Industrial Relations Ordinance and was a judicial order and could have been challenged by an aggrieved party under subsection (3) of section 8, but none of the aforesaid respondents No,3 had challenged the same by filing an appeal and on account of their failure to challenge the order of the Registrar of the Trade Union, they had surrendered their right to question the veracity, legality and propriety of the order of the Registrar of the Trade Union and bound themselves by the findings given therein. Mr. M.L. Shahani further submitted that all the aforesaid respondents No,3 were estopped from challenging the finding that they were not the employees of the petitioners. Mr. Mirza Muhammad Kazim, on the other hand, submitted that the order passed by the Registrar of the Trade Union under section 8 of the Industrial Relations Ordinance, refusing to register the Trade Union in the petitioner's establishment, was an administrative order and would neither create any right in favour of any party nor would deprive any party of any of his right guaranteed by a statute. He further submitted that an administrative order could not operate as an estoppel so as to deprive respondents No,3 from having recourse to the rights available to them under the Ordinance and the Standing Orders Ordinance. In support of his above contention that an order passed by the Registrar of the Trade Union under section 8 of the Industrial Relations Ordinance was merely an administrative order and would neither confer nor deprive any party of his rights, he referred to the case of Muhammad Chiragh through L.R. Sehar Bano Bibi and others v. Dullav Khan and others (PLD 1954 Dacca 134). We have gone through the aforecited case and find that there is no reference either to section 8 of the Industrial Relations Ordinance or of an order of Registrar, Trade Union, refusing to register a Trade Union, being an administrative order. It is to be presumed that Mr. Mirza Muhammad Kazim had tried to misguide us by citing a wrong and inapplicable authority, in support of his contention, which we had doubted. The Registrar of the Trade Union has been conferred the power to register or refuse to registered Trade Union, formed by workers of an establishment and his order is made appealable under subsection (3) of section 8 of the Industrial Relations Ordinance. The application filed by respondents No,3 for registration of the Trade Union was rejected by an order of the Registrar of the Trade Union, which was a judicial pronouncement inasmuch as in deciding the same, the Registrar of the Trade Union had followed the principles laid down for deciding a question or issue judicially. Any party aggrieved by the same had to challenge it by way of an appeal and on failure to do so, accepted the verdict and would be bound by it. We are not at all convinced with the reasons given by the Sindh Labour Court for not placing any reliance on the order of the Registrar of the Trade Union. The said order was brushed, aside by the Sindh Labour Appellate Tribunal in one sentence by stating that it was too late in the day. We are unable to understand as to what was meant by this observation.
11. ' The other ground on which Mr. M.L. Shahani assailed the impugned order was that neither the Sindh Labour Appellate Tribunal nor the Presiding Officer of the IIIrd Sindh Labour Court had taken into consideration the contents of the job contract entered into between the petitioners and M/s AI-Khair Services Limited. In this connection, he drew our attention to paragraphs Nos,i, ii, iv, v, vi, xiii, xv, and xix in particular of the job contract to substantiate his contention that the petitioners had, in good faith and in accordance with the provisions of law, entered into agreement with M/s. Al-Khair Service for manufacturing/building of bodies of the buses and commercial vehicles w,e,f, 1-10-1988 and that all the aforesaid respondents No,3 were employed by M/s. Al-Khair Services as their employees in the capacity of workers/workmen. Mr. Mirza Muhammad Kazim, on the other hand, submitted that the aforesaid agreement was merely an eye wash and was executed with a view to deprive all the aforesaid respondents No,3 of their rights and interests available to them under the various labour laws against the petitioners. Mr. Mirza Muhammad Kazim drew our attention to paragraphs x, xiv, xvi and xvii of the job contract in support of his contention that M/s Al-Khair Services was not assigned any independent and separate contract by the petitioners for carrying out the work of manufacturing/building of bodies of the buses and commercial vehicles but that their status was that of a supervisor and overseer to supervise and oversee the work carried out by respondents No,3, who basically were the employees of the petitioners. Great emphasis was laid by Mr. Mirza Muhammad Kazim on paragraph No,X of the job contract, which, according to him, completely exposed the ulterior designs and mala fide intention of the petitioners to enter into a fraudulent and fake agreement with M/s. Al-Khair Services purporting to assign the work of building/manufacturing of the bodies of the buses and commercial vehicles of M/s. Al-Khair Services to work independently and separately of the petitioners. We are unable to agree with the contention of Mr. Mirza Muhammad Kazim. If the petitioners had enterecd into an agreement with M/s. Al-Khair Services with mala fide intention and ulterior motives with a view to devise a plan to disown respondents No,3 as their employees so as to disentitle themselves of their obligations and liabilities towards respondents No,3 under the various laws, then they would not have explicity made arrangement and settled terms and conditions embodied in paragraph No,X of the job contract. We are also unable to agree with the finding of the Sindh Labour Appellate Tribunal doubting the agreement entered into between the petitioners and M/s. Al-Khair Services for payments of wages/salaries by the petitioners directly to respondents No,3 instead of the lump sum payment being made to M/s AI-Khair Services for onwards payment to respondents No,3 on the ground of insecurity prevailing in the town and are not at all impressed by the observations made as under:-- "To say that M/s. Al-Khair Services were not dealing with cash because of the general insecurity in the town is too much of a demand on our credulity."
12. ' We are also unable to find ourselves in agreement with the finding of the Sindh Labour Appellate Tribunal that so-called contract was nothing but a smoke-screen to deprive the workers of their lawful wages, and benefits given to them under the labour laws inasmuch as by the aforesaid job contract, the aforesaid respondents No,3 were not deprived of any of their rights, interest, privileges and benefits provided to them under the labour laws. The only difference which had emerged by execution of the job contract was that the aforesaid rights, interest and benefits provided to respondent No,3 under the labour laws were to be provided by M/s Al-Khair Services instead of the petitioners. Mr. M.L. Shahani further submitted that the law admits of the concept of assignments/entrusting of certain work or job by an industrial establishment to an independent and separate contractor, who for the purpose of carrying out and completing the said work/job would be absolutely independent and free to appoint his workers/employees, to make payments to them, to provide all the rights and benefits available to them under the labour laws and to make payments/contributions on their behalf under the various statutes, such as Social Security Fund, Old Age Employees Fund etc. In support of his above contention, he referred us to the cases of
(i) Mian Munir Ahmed v. The State (1985 SCM R 257);
(ii) Farid Ahmed v. Pakistan Burma Shell Limited (1987 SCM R 1463) and
(iii) Sindh Employees Social Security Institution v. Consolidated Sugar Mills (1989 SCM R 888).
13. ' Mr. Mirza Muhammad Kazim, on the other hand, submitted that the definition of worker and workman as provided in the Ordinance and the Standing Orders Ordinance was not confined to the employees employed by an industrial establishment or commercial establishment directly, but would, also cover the employees employed by a third person or a contractor for the purpose of carrying out the work in an industrial establishment. He further submitted that M/s. Al-Khair Services was not assigned an independent contract to carry out the work of manufacturing/building of bodies of the buses and commercial vehicles but they were engaged as contractor for supply of labour. In support of his above contention, he placed reliance on the cases of
(i) Humayun Badshah v. Habib Bank Limited and three others (1996 SCM R 1606);
(ii) Punjab Seed Corporation and others v. Punjab Labour Appellate Tribunal and others (1996 SCM R 1947) and
(iii) M/s. Hakim & Sons Chemical Industrial (Pvt.) Ltd.. v. The Registrar of Trade Unions and another (1999 SCM R 234).
14. ' We have gone through the case-law relied upon by Mr. Mirza Muhammad Kazim. In none of the cases relied upon by him, the concept of contract employees has been negated. The pronouncements made in the aforecited cases are of no assistance to Mr. Mirza Muhammad Kazim to support his contention that the job contract entered into between the petitioner and M/s Al-Khair was merely a contract to supply labour. We have no dispute with regard to the contention of Mr. Mirza Muhammad Kazim that the definition of worker and workman as provided in the Ordinance and the Standing Orders Ordinance would include an employee, employed or engaged by contractor, for the purpose of carrying out the work assigned or entrusted to him by an industrial establishment. The question which required to be determined was to specify the parties between whom the relationship of employer and employee existed or was constituted. If an industrial establishment succeeds In establishing that it had entrusted or assigned a particular work to an independent contractor, who had been authorized to engage his own labour force and to supervise them for the purpose of completion of the work assigned to it, then the relationship of employer and employee will be between the contractor and the workers/workmen employed by it and such employees would be the workers or workmen as defined in the Ordinance and the Standing Orders Ordinance and would be entitled to all the rights and benefits available to him under the labour laws, but such rights and benefits would be provided to the workers/workmen by the contractor and not by the original industrial establishment. The case-law relied upon by Mr. Mirza Muhammad Kazim, in no way supports his contention that workers/workmen employed by an independent contractor, would be deemed to be the workers/workmen of the original industrial establishment, petitioners herein. As a matter of fact, the case-law relied upon by Mr. M.L. Shahani negates the contention of Mr. Mirza Muhammad Kazim as it fully endorses the concept of employment of labourer/work force employees by an independent contractor in which case the labourer/work force employees would be the workers/workmen of the contractor.
15. ' Mere non-production of termination letters by the petitioners in respect of all the aforesaid respondents No,3 before their engagement/appointment by M/s Al-Khair Services as their employees would not be sufficient to discredit the agreement entered into between the petitioners and M/s. Al-Khair Services and to come to the conclusion that such arrangement was made with a view to deprive respondents No,3 of their rights, benefits and privileges under the labour laws inasmuch as respondents No,3 could not be deprived of such rights which they could claim against M/s Al-Khair Services.
16. Upon the above discussion, we are of the view that both, the Sindh Labour Court and Sindh Labour Appellate Tribunal had arrived at the findings in disregard and overlooking the material evidence on record and had placed reliance on inferences, surmises and conjecture, which, in our view, were not warrranted to be drawn from the material brought on record. Both, the Sindh Labour Court and Sindh Labour Appellate Tribunal had given unnecessarily great importance to paragraph No,X of the job contract and the application under Order 16, Rule 1, C.P.C., wherein M/s. Al-Khair Services were said to be a contractor for the supply of labour and at the same time completely ignoring the order of the Registrar of the Trade Union, wherein all the respondents No,3 hereinabove failed to establish themselves as employees of the petitioners and such order had attained finality as it was not challenged by the aforesaid respondents No,3. In the case of Distribution Officer. (Hoechest)
17. Pharmaceutical (Pvt.) Ltd. And another v. Punjab Labour Appellate Tribunal (1993 SCM R 1282), the Supreme Court, relying on its judgment in the case of Muhammad Sadiq v. Punjab Labour Appellate Tribunal No,1 and another (PLD 1988 SC 633), observed that where the findings of the Labour Courts below were not based on evidence on record,then the High Court would be justified in the light of evidence on record, to reverse the concurrent findings of the labour Courts below.
18. ' It is also pertinent to note that the two Courts below did not take into consideration the statement made by the proprietor of M/s Al-Khair Services, in his cross-examination with regard to the question relating to payment of contribution under the Employees Old Age Benefits Act and the Social Security Ordinance on behalf of the aforesaid respondents No,3. The evidence of Saiyed Saeed Hamid, proprietor of M/s. Al-Khair Services, relating to the salaries and the payment for over time work paid by him to the respondents No,3 and other workers, which was substantiated by him by production of salaries slips, was also completely overlooked. The Sindh Labour Court and Sindh Labour Appellate Tribunal were greatly influenced by the evidence of Saiyed Saeed Hamid, proprietor of M/s. Al-Khair Services, as well as the relevant paragraphs of the job contract, according to which it was brought on record that the salaries/wages were being paid by the petitioners to respondents No,3, but they did not take notice of the fact as stated by Saiyed Saeed Hamid in his affidavit-in-evidence as well as in his cross-examination that he used to submit monthly bills to the petitioners, which represented the wages/salaries of the workers employed by him including respondents No,3 as well as other charges of services rendered by him in connection with the manufacturing/building of the bodies of the buses and commercial vehicles. As a security measures it was agreed that instead of the amount of wages/salaries being paid by the petitioners to Saiyed Saeed Hamid of M/s. Al-Khair Services, who in turn would have been required to pay the same to respondents No,3, the petitioners would pay the amount which they were required to pay to Saiyed Saeed Hamid by way of salaries and wages of respondents No,3 and other workers employed by him directly to such workers and respondents No,3. It will be useful to reproduce the relevant portion of the cross-examination of Saiyed Saeed Hamid, which reads as under:-- ' The applicants were already working with Hinopak when I took the contract. I cannot say, if the applicants services were terminated by Hinopak but I had issued them appointment letters. I am paying the social security and old age contribution, on behalf of the applicants. It is incorrect to suggest that I have not paid contribution of above, in respect of any of the workers. I am not contributing social security or old age benefits contribution, by name of the workers, but I am depositing on the basis of strength of the workers. I produce photo copy of eleven slips, in respect of salaries, paid by him to the workers (original seen and returned) as Exhs.R.5 to R.15. Slips regarding over time, issued to the workers. The charges of the tea and lunch of the worker are being paid by the Hinopak and company charges from me."
19. Accordingly, we allow all these petitions. The decision of the Sindh Labour Appellate Tribunal is set aside and the grievance applications filed by all the respondents No,3 under section 25-A of the Ordinance are dismissed.