SALEEM DIL KHAN, J.---The petitioners have invoked the Constitutional jurisdiction of this Court under Article 199 of the Constitution for taking corrective steps in declaring the order dated 29-7- 1997 passed by Registrar/Administrator Cooperative Societies, N.-W.F.P. As without lawful authority and of no legal effect. Another writ petition numbered as 1569 of 1998 is also directed against the same order where Murad Khan one of the retired employees of the Frontier Cooperative Bank is aggrieved of the impugned order and has assailed the same through writ petition numbered above. Since both these petitions are directed against the same order and common question of law and facts are involved, therefore, we proceed to decide all these petitions through a single consolidated judgment. Brief facts giving rise to the present lis are that the Board of Directors of Frontier Provincial Cooperative Bank (hereinafter called "the Bank") framed Service Rules making provision for pension benefit to the employees of the Bank. Accordingly, an exhaustive set of rules were framed to govern the grant of pension. For the proper implementation of these rules, a fund was created which was named as Pension Fund Trust. The record indicates that after creation of the fund, as many as 32 persons have retired from service out of whom 13 persons have been granted the relevant benefit.
In the meanwhile, the Pension Fund Trust was dissolved by Administrator/Deputy Registrar Cooperative Societies, Peshawar through the impugned order dated 29-7-1997. Resultantly, the remaining 19 persons could not get the pension benefit. It is worthwhile to state that the Bank has now been dissolved/wound up through order dated 19-3-2001 and no other employee can claim pension benefit after the date of winding up of the Bank.
3. We have heard the learned counsel for the petitioners in both the writ petitions and have also heard the learned counsel for the respondents. The main thrust of the learned counsel for the petitioner was on the competence of the administrator to dissolve the Trust and also on the legal flaws in the impugned order. The learned counsel for the respondents mainly contended that the very creation of the Trust was illegal ab initio because the said Trust could be created only by the general meeting of the Cooperative Societies and that its creation by the Board of Directors was an act without jurisdiction.
4. After hearing the learned counsel for the rival parties, we examined the record in all its details.
The impugned order dated 29-7-1997 has been passed by the Administrator in exercise of the powers available to him under Rule 48 of the Cooperative Societies Rules, 1927. A perusal of the impugned order indicates that the Trust was dissolved on two grounds; firstly, that the Trust could be created only by the general meeting of the members of the Cooperative Societies and, secondly, that the creation of the Trust was detrimental to the interest of the members of the Societies and was thus, hit by section 10 of the Trust Act, 1882. In the first instance we understand that Rule 48 empowers the Registrar to supersede the committee or Cooperative Society for a period to be specified in the order passed under the Rules which shall be duly published in the official Gazette with the reasons therefor. Therefore, we find ourselves in agreement with the learned counsel for the petitioner that the dissolution of the Pension Fund Trust could not be made under Rule 48 because it was not a Cooperative Society nor a committee. It is also noteworthy that the impugned order has not been passed by the Registrar nor it has been published in the official Gazette as required by the relevant provision mentioned above.
5. We have examined the two reasons given in the impugned Order for the dissolution of the Trust and proceed to record our finding on the legality or otherwise of the impugned order on the basis of these reasons. So far as the first reason, namely, competence of the Board of Directors, is concerned, we understand that the Trust was rightly created and the impugned order is not only wrong but illegal in dissolving the Trust. According to the bye-laws, the powers of the general meeting of the members have been enumerated in Rule 16 of the Bye-laws of the Bank. We find it advantageous to reproduce the said rule as under:-- "16. In the General Meeting, the following business shall be transacted:--
(i) Election, suspension and removal of members of the Central Board other than the ex officio members and framing of Election Rules, subject to approval of the Registrar.
(ii) Consideration of the annual statement of accounts and Balance Sheet and of the Auditor's Report.
(iii) Disposal of profits, as disclosed by the audited balance-sheet.
(iv) Amendment of the Bye-laws in accordance with the provisions of the Act and Rules.
(v) Prescribing a scale of any item of working expenses and travelling allowance ordinarily payable to members of the Central Board or any Working Committee and the sanction of any special allowance to them."
6. The plain reading of all the provisions of Rule 16 would indicate in neatly clear terms that rules governing the service of the employees of the Bank do not fall under any category of the powers described in the aforesaid provisions, thus, no powers regarding terms and conditions of service are available to the general meeting of the member. Therefore, we hold that the first ground which weighed with the Administrator for passing the impugned order is contrary to law. We find it advantageous to state in this context that the rules framing powers have been conferred on the Board of Directors as detailed in Rule 24 of the Bye-laws. In order to understand the true import of the relevant provision, we reproduce sub-rule (19) of rule 24 as under:-- "(19) To frame, amend service regulations, Provident Fund Rules, Gratuity Rules and other Rules and Regulations respecting Bank's employees subject to prior approval of the R9istrar."
The Rules governing the grant of pension benefit is fully covered by the phraseology "other Rules and Regulations respecting Bank's employees". The next condition "subject to prior approval of the Registrar" has also been fulfilled and, interestingly, the author of the impugned order has affixed his signature on the Pension Trust Deed. In this view of the matter, we have no doubt in our mind that the Trust was created validly, and, in accordance with law. Therefore, we declare this ground of the impugned order as illegal and result of misinterpretation of the relevant law.
7. It was argued with vehemence by the learned counsel for the respondent that the impugned order is correct in holding that the creation of Trust was detrimental to the members of the Society because the same was not approved by the general meeting of the members and, therefore, was in contravention of section 4 of the Trust Act, 1882. We are not impressed with this argument. For, the share capital of the Bank is contributed by the Provincial Government, Federal Bank for Cooperative and members Cooperative Societies in equal proportion, that is to say, 1/3rd by each.
It is because of this reason that the Board of Directors is comprised of 18 members; out of which six members represent the Provincial Government, six members nominated by the Federal Bank for the Cooperative and six members elected by the members of the Societies. Therefore, the unanimous decision of the Board would ipso facto mean that all the three contributors including the members of the societies have assented to the creation of the Pension Fund Trust. It is worthwhile to state that the members of the societies were duly represented by the six Directors properly elected by the members of the societies. Viewed from any angle, we- are not persuaded to agree with the logic that the creation of Trust Fund must have been approved by the general meeting of the members of the societies because members of the societies is one of the three components/contributors of the share capital.
8. As stated earlier, the Bank has been wound up/dissolved, and therefore, no employee would be entitled to get pension benefit after winding up of the bank. Therefore, only 19 persons have been left out because 13 persons have already obtained the benefit before the impugned order was passed. Therefore, the benefit of the instant petitions shall go to only 19 persons including Murad Khan petitioner in Writ Petition No,1569 of 1998. We have also taken note of the fact that in service employees would also get benefit in shape of golden hand shake etc. While 13 retired persons have already received the pension benefits and the petitioners would be the only sufferers at the hand of the impugned order. Therefore, the equity and rule of propriety also demand of this Court to come to the rescue of these persons.
9. For what has been .Stated above, we allow this petition alongwith Writ Petition No,1569 of 1998 and declare the impugned order bearing endorsement No,1207-10/DRP/C, dated 29-7-1997 passed by the Administrator/Deputy Registrar Cooperative Societies as without lawful authority and of no legal effect. In view of the peculiar circumstances of the case, we do not pass any order as to costs.