' SABIHUDDIN AHMED, J.---The facts of this case are brief and simple. The respondent No,1 was employed with the petitioner-Bank and was dismissed from service on 29-12-1991. After serving requisite grievance notice he moved the respondent (Sindh Labour Court No,V), Karachi under section 25-A of the Industrial Relations Ordinance seeking the relief of reinstatement. While the matter was pending, section 2-A was inserted in the Service Tribunals Act stipulating inter alia that a person holding any post under any Organisation by or under a Federal Law or which was owned or controlled by the Federal Government or in which such Government had controlling shares or interest would be deemed to be a civil servant for the purpose of the aforesaid Act. Consequently an objection was raised as to the maintainability of the proceedings before the Labour Court. It was contended that such proceedings abated in view of section 6 of the Service Tribunals Act and the only remedy available to the respondent No,1 was to approach the Service Tribunal by an appeal under section 4. The matter was heard by learned Labour Court alongwith several others involving the same question of law and by an order dated 6-8-1997 it was held that proceedings stood abated.
2. The respondent No,1 preferred an appeal against the aforesaid order before the respondent No,3 (Sindh Labour Appellate Tribunal) wherein it was contended that the Federal Government only owned 49% in the petitioner's bank whereas majority shares (51%) had already been transferred to private parties. Indeed this fact is not disputed by the petitioner. The learned Labour Appellate Tribunal consequently found that in view of the aforesaid admitted position proceedings before the Labour Court did not abate and remanded the matter for decision on merit. Aggrieved thereby the petitioners have called in question the decision of the Tribunal under Article 199 of the Constitution.
3. It may be pertinent to mention that pursuant to the Banks (Nationalisation) Act, 1974, the ownership, management and control of all banks in the country stood transferred to the Federal Government. Section 15 of the Act inter alia enabled the Federal Government to prepare and enforce schemes for merger of certain banks with others. Pursuant to the aforesaid powers a scheme was introduced whereby three small banks were merged with the then Australasia Bank Limited which was re-named as Allied Bank Limited. Subsequently a new subsection (6) was inserted in section 6 of the Act enabling the Government to transfer all or any of its shares in the capital of a bank. By an agreement dated 9-9-1991, the employees of the bank having formed themselves into a group known as the Allied Management Group (A.M.G.) agreed to purchase 51% shares in the capital of the Bank in two places; i,e, 26% in the first place and 25% later. A specific number of shares was allocated to every employee according to his entitlement and at the moment 51% shares are held by such employees or their successors whereas 49% continue to vest with the Federal Government. Three of the seven Directors on the Board of the Bank are nominated by the Federal Government whereas remaining four are elected by the private shareholders. There is no dispute amongst the parties as regards the above factual metrix,
4. Mr. Shahid Anwar Bajwa learned counsel for the petitioner however, argued that the mere fact that the Federal Government no longer owned majority shares in the petitioner did not necessarily mean that the provisions of section 2-A of the Service Tribunals Act were not applicable to the employees of the Bank. For the purpose of determining merits of his contention it may be appropriate to reproduce the aforesaid section 2-A which reads as under:-- "(2-A). Service under certain corporations, etc. To be service of Pakistan.--Service under any authority, corporation, body or organisation established by or under a Federal law or which is owned or controlled by the Federal Government or in which the Federal Government has a controlling share or interest is hereby declared to be service of Pakistan and every person holding a post under such authority, corporation, body or organisation shall be deemed to be a civil servant for the purposes of this Act."
5. Mr. Bajwa argued that the provisions of the above-quoted section 2-A were attracted to a variety of situations. In the first place he urged that they were applicable not only to Organisations established by but even those established under a Federal Law. The word "establish" according to learned counsel did not merely imply initial setting up of an Organisation but also placing it on a sound footing. He contended that it was a Federal Government which had, after merging four small banks succeeded in placing the petitioner on a sound and permanent footing as a viable banking company. Irrespective of the connotations of the expression "establish" we find the arguments plainly untenable on a bare reading of the statutory provisions. It may be observed that section 2- A only speaks of Organisation established by or under a Federal Law and not merely one which is established by the Federal Government. Indeed a company or a banking company is also incorporated under a Federal Law but even Mr. Bajwa was not willing to go to the extent, and rightly so, that the above provisions would be applicable to every incorporated company irrespective of ownership or control by any person.
6. Learned counsel then argued that some force that controlling shares or interest did not necessarily mean ownership of majority shares. Referring to different Law Dictionaries learned counsel argued that the expression "control" has been construed to mean something in the nature of power to regulate, dominant, govern, administer, manage or superintend. Moreover, he pointed out that Federal Government in the circumstances of the case was the substantially dominate shareholders as it owned 49% of the stocks whereas the remaining 51% were scattered over 8000 small shareholders. For all practical purposes, therefore, the petitioner bank was controlled by the Federal Government. In support of his contention Mr. Bajwa relied upon a Full Bench judgment of the Lahore High Court in Kausar Ali Shah v. Member Election Commission PLD 1978 Lah.
5. In the aforesaid case the expression "controlling shares or interest" was interpreted in the context of Election Laws where the nomination papers of the petitioner were rejected on the ground that he was in the service in a company were less than 50% but about 10% shares were held by the Pakistan International Airlines. Their Lordships held that the expression controlling interests ought to be construed in its ordinary sense and it was shown the Government had full control over the affairs of the P.I.A. And adding ups the shares of the P.I.A. Constituted majority holding in the shares of a company, it must be held that the Government had controlling interest and the petitioner stood disqualified from contesting elections.
7. Mr. Latif Sagar, learned counsel for the respondent No,1 on the other hand brought to our attention the terms of the agreement recapitulating the provisions of section 5 of the Banks (Nationalisation) Act and particularly subsection (6) thereof. It may be observed that section 5(1) of the Act stipulated that the ownership, management and control of all banks shall stand transferred to and vest in the Federal Government on the commencing day. Subsection (6) which was introduced later enabled the Government to sale from time to time all or any of its share and provided that upon sale of 26% of the shares the application of the provision of the Act shall stand suspended for such period as the Government may specify and further that upon sale of 51% of the shares provisions of the Act shall cease to apply to such Banks. Moreover, clause 2 of the agreement expressly stipulated that with the sale of 26% with the (A.M.G.) management and control of the Bank shall be handed over to the A.M.G. And the Government would cause and support the election/appointment of three representatives of t'he employees and the nominated Chief Executive as Director. Under clause 2.3 the appointment of the Chief Executive was to be made by the employees after taking approval in writing of the State Bank. Under clause 2.5 unless the employees fail to purchase the remaining 25% shares the Government would not use its voting rights to oust or otherwise prejudice the management and control of the Bank by the A.M.G. And under clause 2.6 even thereafter it will exercise its voting rights subject to the aforesaid clause 2.6.
Learned counsel also referred to a notification dated 30-8-1993 (Annexure A to the memo. Of Petition) declaring that consequent upon transfer of 51% shares to the A.M.G. The provisions of the Banks (Nationalisation) Act have ceased to apply to the petitioner.
8. Mr. Naimur Rehman learned D.A.-G. Appearing for the respondent No,4 stated on instructions that the aforesaid respondents did not have any controlling interest in the petitioner's bank. He nevertheless, agreed with Mr. Bajwa to the extent that controlling interest need not necessarily mean owning majority shares.
9. Having examined the respective contention of the learned counsel, we are inclined to agree with Mr. Bajwa only to the extent that controlling interest may not invariably mean ownership of majority shares and would in this respect follow the view taken by their Lordships in Kausar Ali Shah's case cited above. We are nevertheless of the opinion that the above case does not help Mr. Bajwa inasmuch as it has not been shown that the Government exercised any control over shares registered in the name of any of the remaining 51% shareholders. Furthermore, it needs to be appreciated that management and control over nationalised banks was exercised by the Federal Government on account of specific stipulation by way of section 5(1) of a special law and not merely through ownership of majority interests. The provisions of the Act having ceased to apply the Federal Government cannot claim any interest in the management and control of the Bank.
Moreover there is tremendous force in Mr. Latif Sagar's contention that the Government instead of retaining a controlling interest had in fact decided to abdicate such interests in the management and control of Bank even before divesting itself of majority shares. Thus by no stretch of imagination it could be assumed that the Government continues to retain any controlling interest in the petitioner-bank.
10. For these reasons we find no substance in this petition and are constrained to dismiss the same in limine.