BROOKE BOND (PAKISTAN) LTD. Versus CONCILIATOR

1. MUHAMMAD AKRAM, J. -This is an appeal by special leave of this Court frown the judgment dated the 27th June 1973, passed by a Division Bench of the High Court of Sind & Baluchistan at Karachi, dismissing a Constitutional Petition moved by the appellant herein to call in question a reference to arbitration dated 10-3-72 and two awards dated 24th of February 1972, separately made in pursuance thereof in favour of respondents Nos. 2 and 3 respectively by Mr. Mairaj Muhammad Khan, the then Presidential Adviser for Public Affairs, Government of Pakistan, as the sole arbitrator, under section 31 of the Industrial Relations Ordinance No. XXIII of 1969.

2. The appellant is a Public Limited Company incorporated in Pakistan, with a foreign majority share-holding. It is engaged In blending, packeting and distribution of tea throughout Pakistan. It has a factory situated at Karachi and five sales branches at Karachi, Sukkur, Rawalpindi, Lahore and Peshawar. Each of the branches has a number of depots under its control manned by a salesman and vanman. At present there are about 300 depots belonging to appellant throughout the country. For the purposes of its business the appellant has a large staff including workmen, salesmen and vanmen on its pay rolls.

3. Respondent No. 2 (hereinafter also referred to as the Workers' Union) is a Collective Bargaining Agent representing the factory workers under the appellant in Karachi. Respondent No. 3 (hereinafter also referred to as the Field Staff Union) is registered Trade Union and purports to represent the workers including the salesmen and vanmen in the service of the appellant, Company employed in its sales offices and depots throughout the Province of Sand, as their Collective Bargaining Agent.

4. Respondents Nos. 4 to 6 alongwith three others were employed as workers under the appellant but their services were terminated on 8-1-1963 by the Company. The Workers' Union assailed the legality of the orders terminating their service and in due course the industrial dispute concerning their wrongful dismissal was taken to the West Pakistan Industrial Court at Karachi. But that Court declined to interfere. On this the award made by the Industrial Court was challenged by the Workers' Union before the High Court of West Pakistan, Karachi Bench at Karachi in Appeal No. 7., of 1966 filed on 22-7-1966.

5. During the pendency of that appeal, on the 13/14th of March 1969, a memorandum of settlement was reached between the Company and respondent No. 2 as the Collective Bargaining Agent of the factory workers. This was followed by another memorandum of settlement arrived at between them on 19th October 1972 on certain terms and conditions. This settlement wag to remain in force until 14-3-1973 and it was Inter alia agreed that during this period of validity the. Union will not raise any fresh demands having financial implications.

6. In spite of these settlements the Workers' Union is stated to have placed -the following fresh charter of demands on the Company on 6-2-72

(1) Re-instatement of victimised Workmen/Officers of the Brooke Bond Workers' Union.

(a) Re-instatement with full back pay and all benefits, of

(1) Mr. Akbar Khan ???? Packer (Hon. Secy.)

(2) Mr. Fazle Rabim ???????????????? (Gen. Secy.)

(3) Mr. Taza Gul ????????????????????? (Treasurer)

(b) Re-instatement of-

(1) Mr. Iqbal Ahmad ??? Vanman

(2) Mr. Mir Tahir Ali ?? Salesman

7. (3j Mr. Muhammad ???? Vanman

(4) Mr. Daleel Khan ??? Vanman with fall back pay and benefits

(c) Full entitlements and other benefits shall be given to other discharged workers.

(2) Full average rate wages for weekly holiday/holidays for the workmen who were/are on daily wages.

(3) Award on the demands submitted by the Field Staff Union Brooke Bond Pakistan Ltd.

(4) Ad hoc Relief at the rate of 20 %, 15 % and 10 % to all the workmen with effect from 1st March 1969.

(5) Production Bonus to Coolies and Workmen of

(a) O. T. Deptt.

(b) Packing Deptt.

(c) Engineering Deptt.

(6) Chowkidars, Peons and Drivers shall be treated at pat with the rest of workmen being the workmen of the same Industrial establishment. They shall be given the same rights/facilities as available to all other workmen of the Factory as per the terms of Settlement/Settlements so far arrived at between the Brooke Bond Workers' Union and the Management of Messrs Brooke Bond Pakistan Ltd., Mauripur Road, Karachi.

(7) Union's participation in the Medical Relief Committee.

(8) To make all workmen permanent if they have put in more than three months continuous service.

8. The Field Staff Union placed a separate character of demands raising in all 26 demands against the Company. Out of these the first two which are relevant for the present purposes are reproduced below:

9. Demand No. l.-All the members of the staff employed as Vanmen, Salesman/Relief Salesmen, Clerks and over members shall be placed in the following consolidated salary scales ; tram retrospective effect of 1st January 69. The present staff shall be fitted at a stage higher and thereafter adjusted accordingly.

10. Rs.

(i) Vanmen ?????????????????????????????????????????????????????? 250-15-325

(ii) Salesmen/Relief Salesmen ??????????????????????????? 600-30-900

(iii) Clerk ????????????????????????????????????????????????????????? 500-25-750

(iv) Peon ????????????????????????????????????????????????????????? 200-IS-275

(v) Cooly (Tikka) ???????????????????????????????????????????? 200-15-300

11. Demand No. 2.-The scales staff such as Vanmen and Salesmen shall be paid commission for extra curricular work of sates promotion. Generally it shall be paid at the rate of Rs. 50 and 100 p.m. to Vanmen and Salesmen respectively and additionally Rs.100 per 1000 Lbs. in addition to the target figures of normal sales.

12. Normal Sales

13. Centres A ???????? Over 5000 Lbs. per month

14. Centres B ???????? Over 2000 Lbs. per month

15. Centres C ??????? Over 1000 Lbs. per month

16. It appears that the Management was not agreeable to these demands. In early 1972 industrial peace of the country was greatly disturbed and unrest and commotions prevailed in Karachi. In those days, according to the appellant, respondents Nos. 2 and 3 and the workers took unfair advantage of the prevailing conditions. They exploited the situation and on 10-2-72 procured an agreement from the Company in favour of respondents 2 and 3 for the appointment of Mr. Mairaj Muhammad Khan, the then Presidential Advisor for public Affairs, Government of Pakistan, as a sole arbitrator for the adjudication of the disputes arising out of their two charters of demands by intimidation, under duress, coercion and undue pressure against the free will and consent of the Company. The arbitrator entered upon the reference. On the 14th of February 1972, the Company filed its written statement before the arbitrator and inter alia raised a preliminary objection to the effect that in presence of the memorandum of Settlement dated 19th October 1971, respondents Nos. 4 to 6 were not entitled to be re-instated and also that respondent No. 2 was debarred from raising any fresh demands having financial implications against the Company. The Company refused to admit that the salesmen and vanmen were workmen within the definition of the term under section 2 (xxviii) of the Industrial Relations Ordinance, 1969 and as such respondent No. 3 could not lawfully represent them as their Bargaining Agent. In their joint reply filed by respondents Nos. 2 and 3 before the arbitrator they denied the validity of the two memorandums of settlements dated 13th of March 1969 and 19th of October 1971; as having been procured from respondent No. 2 under coercion and threat. 1t was, therefore, alleged that those were not binding on them.

17. On the 24th of February 1972, the said arbitrator gave his two separate awards in favour of respondents Nos. 2 and 3 respectively and despatched copies thereof to the parties, In the award the arbitrator inter alia directed the re-instatement of respondents Nos. 4 to 6 allowing them back benefits by payment of their full pay and other dues for the period they remained out of employment. He allowed ad hoe relief to all the categories of workmen employed by the appellant including vanmen and salesmen at the rates varying from 10 to 20% of their salaries with retrospective effect from 1st of March 1069 to be paid within a period of one month. This was in addition to the productive bonus allowed to the various categories of the employees. Incoming to this conclusion the arbitrator held that both the memorandums of settlements dated 1393-69 and 19-10-71 were not made in accordance with law and were procured under duress and coercion and as such were not binding on respondent No. 2 in the other award in favour of respondent No. 3 the arbitrator held that the salesmen and the vanmen are workmen within the definition of section 2 (xxviii) of the Industrial Relations Ordinance, 1969 and that the Field Staff Union was a duly registered Trade Union of the workmen of the sales establishment of the Company and was duly constituted as the Collective Bargaining Agent of the workmen including the salesmen and vanmen. In the opinion of the arbitrator the salesmen in Karachi and in the area of the Province of Sind in the service of this Company were entitled to a uniform rate of salary in the scale Rs. 600-30-900. Their pay to be fixed in the scale according to their seniority measured in terms of their length of service as Salesmen. The arbitrator also awarded the following scales of pay to the Vanmen and Cooly (Tikka)

18. ??????????? Categories ??????????????????????????????? Scale of salary

19. ??????????????????????????????????????????????????????????????????????????????????? ??????????? Rs.

20. ??????????? (a) Vanmen ????????????????????????????????????????????????????? 250--15-325

21. ??????????????????????? (b) Cooly (Tikka) ???????????????????????????????????????????? 200-15-300

22. These scales of pay were awarded to them retrospectively with effect from 1-8-1969. The arbitrator further directed that the arrears may be paid to them within one month after necessary fixation of their pay in their respective scales. He also awarded incentive remunerations to the salesmen and vanmen based on sales targets at the rates specified by him.

23. In these circumstances the appellant-Company filed the Constitutional Petition against the respondents challenging the validity of the two awards.

24. At the hearing the appellant advanced the following contentions in support of its petition against the two awards before the High Court

(1) That the parties had no capacity to raise the dispute in view of the previous settlements as no dispute could be raised during the validity of those settlements.

(2) That the parties had no capacity to make the reference to the arbitration under section 31 of the Industrial Relations Ordinance without having complied with the requirements of sections 26 to 28 of the Ordinance.

(3) That the reference was bad on account of the coercive methods employed by the respondents.

(4) That the arbitrator did not afford any opportunity to the appellant to lead evidence.

(5) That the awards were based on no evidence.

(6) That the awards were erroneous on the face of the record.

25. But a Division Bench of the High Court of Sind & Baluchistan at Karachi dismissed the petition on the 27th of June 1976. The High Court gave effect to a preliminary objection raised on behalf of the respondents to the effect that no writ could be legally issued to an arbitrator who was appointed by the agreement of the parties, and did not perform any functions connected with the affairs of the State to the opinion of the Court the Constitutional Petition to challenge the validity of the two private awards made by the arbitrator appointed under a reference arrived at with the consent of the parties was not maintainable. On the merits according to the High Court this reference to the arbitration was invalid and contrary to the mandatory requirements of sections 26 'o 31 of the Ordinance. Neither the reference to arbitration nor the impugned awards were mad? in pursuance to any conciliation proceedings undertaken by the Conciliator in accordance with the law. The High Court observed that in the opinion of the arbitrator the two previous settlements of the years 1969 and 1971 between the Company and the Workers' Union were procured by the Company by undue influence and coercion and as such they did not debar the respondents from raising these demands forming the subject-matter of the impugned awards. But the High Court expressed its inability in these proceedings to sit in appeal on these findings of the arbitrator. According to the High Court the appellant failed to raise the objection before the arbitrator to the effect that the parties had no capacity to make this reference to him under section 31 without having fully complied with the provisions of sections 26 to 28 of Ordinance. Therefore, in the opinion of the High Court, the appellant must be deemed to have waived the objection and the Company could not be allowed to raise any such objection against the appointment of the arbitrator for the first time before it in these proceedings. The appellant fully knew that the arbitrator was appointed without having complied with all the requirements of the provisions contained in sections 26 to 31 of- the Ordinance and despite that the Company not only entered into the reference and agreed to the arbitration but also continued to participate in the proceedings before the arbitrator and submit to his jurisdiction. Therefore, they could not be permitted in the proceedings before the High Court for the issuance of an appropriate writ to turn round arid challenge, the authority of the arbitrator to enter upon the reference. The High Court refused to entertain the objection advanced by the appellant-Company to the effect that the .reference to arbitration was procured from them under pressure and by coercive methods employed by the respondents it was never raised before the arbitrator in the first instance. On going through the record of the proceedings before the arbitrator, the High Court was satisfied that before him the parties merely relied on their respective written statements, and the documents filed by them and that they had themselves dispensed with the right of further hearing and to adduce any evidence before him. In the opinion of the High Court the award wag based on the material produced by the parties :before the arbitrator. There was no error apparent on the face of the award. In corning to this conclusion the Court held that it was not open to it to go into the evidence led by the parties before the arbitrator but riot discussed in the award itself and that the Court cannot constitute itself into a Court of appeal over the decision of the arbitrator and make a sifting examination of the entire proceedings before him. The High Court, however, observed that in any case the award must necessarily be confined within the scope of the reference and the arbitrator cannot travel beyond it. In conclusion the High Court refused to interfere with the two awards and dismissed the petition before it as incompetent.

26. This Court allowed leave to appeal from the judgment of the High Court as it gave rise to points of considerable general importance. I shall first deal with the objection against the maintainability of the Constitutional Petition filed by the appellant in the High Court. A preliminary objection to this effect was raised on behalf of the respondents in the High Court. It was argued that in this case Mr. Mairaj Muhammad Khan was appointed as the so arbitrator with the agreement of the parties and therefore his position was no mare and no better than that of a private arbitrator only. In making this awards he did not perform any functions connected with the affairs on the State to attract the application of Article, 93, of the 1962 Constitution.

27. The High Court gave effect to this objection raised before it on behalf of the contesting respondents. In that connection the High Court observed that the main question for consideration was whether this was a statutory arbitration or not. According to the High Court there are many statutes which provide for settlement of disputes by arbitration. Nevertheless it was not in every such case that the arbitration is statutory. In its opinion in a statutory arbitration three considerations must be fufilled (a) that the statute must provide for arbitration, (b) that the arbitration is compulsory and (c) that the relevant provisions of the statute are treated as the reference to arbitration. In elaborating the High Court further observed that in a statutory arbitration the law compels the patties to agree to arbitration by a person or authority named therein or nominated by another authority. On the other hand in a private arbitration although the statute makes provisions for arbitration, it is purely optional and the reference to arbitration is made only with the consent of the parties. According to the High Court in the instant case under section 31 of the Industrial Relations Ordinance the reference to arbitration was not at all compulsory. It was altogether discretionary and optional, dependent upon the agreement of the parties. Therefore, in the opinion of the High Court it was a private arbitration only and no writ could be issued to the arbitrator exercising his powers by virtue of an agreement made with the consent of the parties. In arriving at this conclusion the High Court in particular relied on the reported cases of Rajbarl Devi v. Deputy Registrar Co-operative Societies A I R 1963Al1.113 and A. K. M. Employees Association and Musaller Industries (Private) Ltd. and another II L L J Ker. HC under the Indian jurisdiction.

28. In general the common law envisages this distinction against the issuance of prerogative writ to the privately appointed arbitrators. In that connection in Regina v. National Joined Council (1933) 1 Q B 704, Lord Goddar. C. J. observed as under

29. "But the bodies to which in modern times the remedies of these prerogative writs have been applied have all been statutory bodies on whom Parliament has conferred statutory powers and duties which when exercised, may lead to the detriment of subjects who may have to submit to their jurisdiction.

30. There is no instance of which I know in books where certiorari or prohibition has gone to any arbitrator except. a statutory arbitrator, and a statutory arbitrator is a parson to whom by stature the parties must resort."

31. Undoubtedly under section 31 of the Industrial Relations Ordinance, 1969 the appointment of an arbitrator is made on a voluntary reference to arbitration. But his true character, the functions he has to perform and the procedure he has to follow can best be gathered from a study of the different provisions of the Ordinance. The appointment of the arbitrator for the settlement of an industrial dispute is made under the Industrial Relation Ordinance, 1969 and not the Arbitration Act, 1940. The term 'arbitrator' is defined in section 2 (i) of the Ordinance to mean a person appointed as such "under this Ordinance. According to section 2 (ii) "award" means the determination by a Labour Court, Arbitrator or Appellate Tribunal o; any industrial dispute or any matter relating thereto and includes an interim award. In section 2(xxiv) the term 'settlement' is defined to mean a settlement arrived at in the course of conciliation proceeding, and includes an agreement between an employer and his workmen arrived at otherwise than in the course of any conciliation proceeding there such agreement is in writing, has been signed by the parties thereto in such manner as rosy be prescribed and a copy thereof has been sent to the Provincial Government, the conciliator and such other person as nay be prescribed. Subsection (1) of section 31 deals with the appointment of the arbitrator. It lays down that if the conciliation fails, the conciliator shall try to persuade the parties to agree to refer the dispute to an arbitrator. In case the parties agree, they shall make a joint request in writing for reference of the dispute to an arbitrator agreed upon by them. According to subsection (2) of this section the arbitrator to whom a dispute is referred under subsection (1) may be a person borne on a panel to be maintained by the Provincial Government or any other person agreed upon by the parties. Subsection (3) lays down that the arbitrator shall give his award within a period of thirty days from the date on which the dispute is referred to him under subsection (1) or such further period as may be agreed upon by the parties to the dispute. Under subsection (4) after the arbitrator has made an award, the arbitrator shall forward a copy thereof to the parties and to the Provincial Government who shall cause it to be published in the official Gazette. Subsection (5) lays down that the award of the arbitrator shall be final and no appeal shall lie against it, and that it shall be valid for a period not exceeding two years as may be fixed by the arbitrator. In effect the award made by an arbitrator appointed with the consent of the parties under section 31 has the same force and validity as an award made by a Labour Court and a settlement arrived at between the parties. Section 34 expressly lays down that any Collective Bargaining Agent or any employer may apply to the Labour Court for the enforcement of any right guaranteed or secured to it or him by or under any law or any award or settlement. As in the case of an award made by an Arbitrator, copies of the award or decision of a Labour Court are forwarded to the .Provincial Government for publication in the official Gazette in accordance with the requirements of section 37 of the Ordinance. An award made by the arbitrator is final and no appeal lies against it under section 31 (5). On the other hand an award made by a Labour Court is subject to a right of appeal against it to the Labour Appellate Tribunal in accordance with section 37 (3). Section 39 lays down that a settlement arrived at in the course of a conciliation proceedings, on award of an arbitrator published under section 31, an award or decision of a Labour Court delivered under section 37 and the decision of a Tribunal under section 38 shall (a) be binding on all parties to the industrial dispute, (b) be binding on all other parties summoned to appear in any proceedings before a Labour Court as parties to the industrial dispute, unless the Court specifically otherwise directs in respect of any such party, (c) be binding on the heirs, successors, or assigns of the employer in respect of the establishment to which the industrial dispute relates where an employer is one of the parties to that dispute, and (d) where a Collective Bargaining Agent is one of the parties to the dispute, be binding on all workmen who were employed in the establishment or industry to which the industrial dispute relates on the date on which the dispute first arose or who are employed therein after the elate. According to section 40 (3) the arbitrator, the Labour Court, or as the case may by, the Tribunal, shall specify dates from which the award on various demands shall be effective and the time limit by which it shall be implemented in each case. However it is provided i n section 4;i (5) that notwithstanding the expiry of the period for which an award is to be effective the award shall continue to be binding on the parties until the expiry of two months from the date on which either party informs the other party in writing of its intention no longer to be bound by the award. Under section 50 (1) if any difficulty or doubt arises as to the interpretation of any provision of an award or settlement, it shall be referred to the Tribunal constituted under the Ordinance. According to section 51 (1) any money due from an employer under a settlement, an .award or decision of the arbitrator, Labour Court or Tribunal may be recovered as arrears of land revenue or as a public demand. Breaches of the terms of any settlement, award of decision are made penal offences punishable under section 54. Similarly under section 55 wilful failure to implement any term of any settlement, award or decision under the Ordinance constitutes a penal offence. recovered as arrears of land revenue or as a public demand. Breaches of the terms of any settlement, award or decision are made penal offences punishable under section 54. Similarly under section 55 wilful failure to implement any term of any settlement, award or decision under the Ordinance constitutes a penal offence.

32. This brief resume of the provisions of the Ordinance shows that the award made by the arbitrator about an industrial dispute is authenticated by its publication by the Provincial Government is tine official Gazette like any other award made by the Industrial Court. The recourse through arbitration by an arbitrator appointed with the consent of the parties is a recognised mode for the settlement of an industrial dispute bet peen them under section 31 of the Ordinance and the award made by the arbitrator is equally binding and enforceable like any other award made by the Industrial Court.

33. Section 31 of the Industrial Relations Ordinance, 1969 read with section 46 of the Arbitration Act specifically makes the provisions of the said Ordinance as a part of the arbitration agreement The arbitrator is constituted by and invested with the powers under the provisions of section 31 of tile Ordinance for the adjudication of industrial disputes between the parties. The machinery for the execution of the award made by the arbitrator envisaged under sections 51, 54 and 55 of the Ordinance, is made available only after it has been published by the Provincial Government in the official Gazette. It then become an officially recognised document binding between the parties and capable of enforcement. The authority of arbitrator to act as such in an industrial dispute arises not by agreement of the parties but by virtue of the reference made by the conciliator under section 31 (1) of the Ordinance. The parties did not have any capacity to confer jurisdiction on the arbitrator or to reach an agreement for reference to him outside the context of the Industrial Relations Ordinance in relation to matters falling within its scope. The representative character of a collective Bargaining Agent, re-instatement of workmen and settlement of industrial disputes are matters within the exclusive domain and scheme of the Ordinance aid not the Arbitration Act. Indeed there is no jurisdiction or power in an arbitrator, appointed otherwise than under section 31 of the Ordinance to adjudicate upon these matters.

34. In the 1962 Constitution of the Islamic Republic of Pakistan it was laid down in the Principle of Policy No. 8 that just and humane conditions of work should be provided, Also under the Principle of Policy No. 9 (c) the State was bound to secure the well-being of people irrespective ? of caste, creed or race by ensuring an equitable adjustment of rights between employees and employers. It is the responsibility of every modern State to achieve social and economic justice in society. In order to establish a just order in society industrial peace and prosperity must be ensured through welfare legislation, the State must evolve a satisfactory and workable system for peaceful settlement of industrial disputes and conflicts without any delay and strife as far as possible. It is of vital concern for every Government established by law to maintain industrial relations and see that industrial peace is not disturbed in the interest of national economy. Indeed the Government is as much a party to an industrial dispute to see that it is resolved justly and peaceably. With this end in view the Ordinance contemplates the settlement of industrial disputes by negotiation, mediation, conciliation and arbitration between the parties and failing that by resort to the Labour Courts specially established for the purpose. As already stated above the arbitrator appointed by the parties is constituted and invested with legal authority under the Ordinance to adjudicate upon industrial disputes and discharges quasi-judicial functions entrusted to him under the law. His appointment is accorded statutory recognition and he is invested with quasi-judicial powers under section 31 of the Ordinance. He acts as a person clothed with legal authority to perform his functions pertaining to the affairs of the State. His award is equally binding and enforceable between the parties like any other award made by tire industrial Court under the Ordinance. According to Article 98 (2) (a) the High Court of a province may, if it is satisfied that no other adequate remedy is provided by law, on the application of any aggrieved party, make an order directing a person performing in the province functions in connection with the affairs of the' province to refrain from doing that which he is not permitted by law to do or to do that which he is required by law to do.

35. In the Ring v. Electricity Commissioner, In re : Ex parte London Electricity Joint Committee Company Limited and others (1923) K B 171 Atkins, L. J. observed that the operation of the writs has extended to control the proceedings of bodies which do not claim to be, and would not be recognised as Courts of Justice. Whenever any body of persons having legal authority to determine questions affecting the rights of subjects, and having duty to act judicially, act in excess of their legal authority they are subject to the controlling jurisdiction of the King's Bench Division exercised in writs.

36. As already discussed above, under section 31 (4) of the Ordinance a duty is cast on the arbitrator to submit his award to the Provincial Government and the Government in turn is bound to publish the award in the official Gazette. The arbitrator appointed under section 31 (2) of the Ordinance serves as a link between the reference made to him by the Conciliator and the publication of the award by the Government. At any rate, in a proper case, the prerogative writ may be issued against the functionaries of the Government against the publication of the award, in case the High Court finds that it was not made in accordance with law and bas no light effect:

37. As observed in Halsbury's Laws of England (Fourth Edition), Vol. 2, para. 510, there are many statutes which provide for settlement of disputes by arbitration and their number is increasing. In some cases arbitration is compulsory, in others arbitration may be resorted to at the option of the parties. The learned author bas also given lists of the examples of these statutes. In my opinion, however, the statutory arbitrations take their character from the statutes providing them and in this connection the distinction drawn by the High Court appears to be artificial.

38. Russel on Arbitration, Chapter 7 on "Statutory Arbitration" page 98 (Seventeenth Edition) has observed that a statute may provide that disputes of a particular class shall be determined by arbitrator of a particular sort, either in every case or upon certain steps being taken by the parties. Where such a provision applies, the arbitrate tribunal laid down by the statute has exclusive jurisdiction over suds dispute. In that connection the learned author has further observed at page 188 that in the cafe of a Statutory arbitration, the normal procedure may not be applicable or the statute concerned may exclude it. The Courts will then have recourse to prerogative orders: thus mandamus will lie to' a statutory arbitrator, and so will prohibition and. certiorari.

39. I find that under the Indian jurisdiction there has been a conflict of judicial opinion amongst some of the High Courts on the true character and effect of arbitration under a similar provision in force in that country. But the controversy was set at rest by the observations by the Supreme Court of India in Anglo-American Direct Tea Trading Co. Ltd. v. Their Workers and another A I R 1963 S C 874. That case related to the appointment of an arbitrator with the consent of the parties in accordance with section 10-A(1) of the Indian Industrial Disputes Act, 1947. Under it the parties to an industrial dispute may agree to refer the dispute to arbitration by a written agreement and the reference shall be to such person as arbitrator as may be specified in the arbitration agreement. In teat case the Supreme Court on a consideration of the relevant provisions under the law observed that an arbitrator appointed under section 10-A could not be treated to be exactly similar to a private arbitrator to whom a dispute has been referred under an arbitration agreement under the Arbitration Act, and that possibly, in a loose sense, he may be described as a Statutory arbitrator. In Air Corporation Employees' Union and another v. D. V. V yas and others A I R 1962 Bom.274, the Court held that the arbitration contemplated by section 10-A of the Indian Act has all the essential attributes of a statutory arbitration and the High Court has power of superintendence over him. I have, therefore, no hesitation in observing that in the instant case the High Court has relied on two reported cases from the Allahabad and Kerala High Courts, which did not lay down good law in view of the pronouncement by the Supreme Court of India In re : Anglo-American Direct Tea Trading Co. Ltd. v. Their Workers and another.

40. The learned counsel for the appellant next laid stress before us that the very agreement of reference dated 10th February, 1972 to the arbitration of Mr. Mairaj Mohammad Khan in this case was involuntary and had been procured from the company by intimidation, duress and pressure and the use of coercive methods employed by the respondents. This plea was actually taken by the Company in its written statement filed before the arbitrator. But the High Court refused to entertain the objection because it would necessitate an enquiry into disputed questions of fact between the parties. Moreover, in the opinion of the High Court, although the Company had taken the objection in its written statement filed before the arbitrator, but it was not pressed before him at the hearing.

41. But in my considered opinion none of these considerations that has prevailed with the High Court is tenable. As already discussed above this was a statutory arbitration between the parties and in the proceedings before it under Article 98 of the 1962 Constitution, the High Court was not debarred from entertaining the dispute as to the validity of the reference in question. Indeed in this connection the High Court itself deemed it proper to summon Mr. Moosa Khan, Deputy Director, Labour Welfare, Karachi and recorded his statement on 4-4-1972 in order to elicit true facts. The impugned judgment also shows that during the hearing before it the High Court had itself suggested to the learned counsel for the appellant to call the arbitrator for his evidence but he declined to avail of the opportunity. The precise objection was admittedly raised by the Company in its written statement filed before the arbitrator. The record of the proceedings before the arbitrator shows that the parties were given an opportunity to file their respective written statements and produce the documents on which they relied. Beyond this there was no oral hearing allowed to the parties before the arbitrator. He was required to give his award on the basis of the material placed before him by the parties. In this state of affairs the High Court was little justified in holding that this precise objection although admittedly raised by the Company in its written statement was not pressed before the arbitrator. In my opinion therefore none of these objections that had weighed with the arbitrator are tenable. As such the Company was not precluded from advancing the objection before the High Court.

42. In the interest of justice and under the peculiar circumstances of this case I have, therefore, deemed it proper to examine tile merits of this objection raised by the Company. In that connection the appellant filed a number of affidavits in the High Court in support of the writ petition. The circumstances that led to the signing of the, impugned agreement of reference to arbitration dated I0-2-1972 between the appellant and respondents Nos. 2 and 3 an: set out in the sworn affidavit filed by Mr. Henry James Lloyd, Production Director of -the Company in support of its case. According to him on the 24th of January-, 1972, the President of the Workers' Union. Mr, Akbar Khan, and an examination of the Karachi Branch Mr. Iqbal Ahmed bad gone on hunger strike in front of the premises of the Company without placing any demands on it. In that connection on the 26th of January, 1972 tire Management of the company was gheraoed. In this Mr. Saeed Hassan, MPA intervened, discussions were held between the parties and the gherao was lifted at 4 a m .on 27-1-1972. But afterwards on the 3rd of February, 1972 the management was once again gheraoed and on this occasion the workers attempted to molest Pakistani Officers of the Company. As a result of this violent attitude of the pokers on the 3rd of February, 1972, Mr. Shafiq Ahmad Khan, Assistant Commissioner and S. D. M. Harbour, Karachi on his own initiative and without the authority of the Management informed the workers that the matter would be referred to arbitration. As against this the Management was prepared for the matter to be decided by the appropriate authorities under the Labour Laws. But Mr. Shafiq Ahmad Khan stated that his act could be challenged later. Accordingly on the 7th of February, 1972 the Chairman of the Company even wrote a letter to Mr. Shafiq Ahmad Khan in that connection. On the 7th of February, 1972 the Chairman also received a telephone call from the Private Secretary to the Central Minister for Labour, inviting him to attend a meeting on the following day for discussion on the pending dispute between the Management and the Union. On the 8th February, 1972 at 10 a.m., a few hours before the meeting called by the Minister for Labour, a copy of a letter dated 6-2-1972 addressed by the Union to the Deputy Commissioner, Government of Sind, Karachi was delivered to the Company along with au Annexure containing further demands. In the meeting with the Central Minister for Labour held on the 8th of February, 1972 the Company produced a copy of the letter dated 7th of February, 1972 sent by the Chairman of the Company to the said Mr. Muhammad Shafiq Khan and also placed reliance on the two memorandums of settlement dated 13th of March, 1969 and 15th of October:, 1171 in support of it: stand. On that the Minister suggested that the question of any demands not legally covered by the Labour Laws or the memorandum of settlement could be discussed and resolved in accordance with law before tile Director of Labour, Government of Sind, or the Governor's Labour Committee But the Union refused to participate in any such meeting called before the Governor's Labour Committee or the Director of Labour and in the presence of the Minister they threatened to gherao the Officers of the appellant-Company and their families at their houses, unless the matter was referred to the arbitration of Mr. Mairaj Muhammad Khan as demanded in the Union's letter dated 6th of February, 1972 addressed to the Deputy Commissioner, Karachi. It is further armed in the affidavit that these incidents commencing from 24th of January. 1972 leading up to 8th February, 19972 in the context of the personal threats held out to the executive staff of the Company operated as a duress, particularly as they had been gheraoed and personally threatened with violance to themselves as well as to their families. It was in the face of these threats that the Chairman of the company agreed on the evening of 8th of February, 1972 that legal issues not covered by the existing settlement should be referred to the arbitration of lair. Mairaj Muhammad Khan. On this the Representatives of the Company were informed that Mr. Mairaj Muhammad Khan would see them and the Unions representatives on 10th of February, 1972 at 6 a.m. Accordingly the Chairman of the Company alongwith its other representatives met Mairaj Muhammad Khan in the presence of the Union's representatives and also gave a copy of a letter dated 10th of February, 1912 addressed to the Minister for Labour together with the draft terms of reference for arbitration as they were understood by the appellant. But Mr. Mairaj Muhammad Khan and the Union's representatives refused to accept the proposed terms of reference and the Union's representatives once are resorted to threats if their demands were not fully met. It is alleged that the. Union insisted that the latter should ire referred to the arbitration of Mr. Mairaj Muhammad Khan under section 31 of the industrial Relations Ordinance, 1969 and the terms of reference should be drawn up in the presence of the Deputy Director Labour. Therefore, at the instance of the Union's Legal Adviser and threats of the Union's representatives in the presence of Mr. Mairaj Muhammad Khan, the representatives of Company were compelled to proceed at 9 p.m. on the 10th of February, 1972 to the Labour Directorate, where the Union's Legal Adviser brought Mr. Moosa Khan Deputy Director Labour from his house. It is stated that the Company's representatives objected to the terms of the reference demanded by the Union being contrary to the two settlements dated 13-3-1969 and 19-10-1971. But the objections were brushed aside and the Union's Legal Adviser threatened them with dire consequences if they did not agree to the arbitration as suggested by the Union. R hereupon the terms of reference ? as drawn up by Mr. Mossa Khan, Dy. Director Labour at the request of the Union's representatives, were signed by the representatives of the Company.

43. These allegations were denied before us on behalf of the respondents. Their counter version of the sequence of events culminating in the execution of the impugned agreement for reference to arbitration is contained in the sworn affidavit of Mr. Muhammad Akbar Khan, President of the Workers' Union filed in the High Court. He affirmed on solemn affirmation that on the 20th of January, 1972 he had personally handed over the demands of the factory workers, which are the subject-matter of the first award to the factory Manager Mr. Abidi and requested him for negotiation and settlement. But on the 22nd of January, 1972 Mr. Abidi told him that the Company was not prepared to negotiate and enter upon any settlement of the demands made by them. He also threatened them that in case the Union persisted in pursuing their demands the Company shall terminate services of the entire Managing Committee of the Union. On this on the 24th of January, 1972 Mr. Akbar Khan, along with Iqbal Ahmad a member of the Field Staff Union) went on hunger strike in support of their respective demands against the Company. However, on the 26th of January, 1972 Mr. Said Hassan, M. P. A. intervened and tried to persuade them to call off the strike. He after consultation with the appellant informed them that the Company was agreeable to some of their demands and that the remaining demands of the Union could be discussed in a meeting to be held with the Company afterwards on 31-1-1972. On this assurance they called off the hunger strike. But afterwards on the 31st January, 1972 when the Company was approached for a settlement of the remaining demands, they refused to negotiate and agree to any settlement. On this Mr. Akbar Khan contacted Mr. Said Hassan and apprised him of the stand taken by the Company. He then advised him to contact Mr. Qassim Patel, Minister for Induitries, Government of Sind, But he could not be contacted as he was not available. In the meantime the workers were getting restive and Mr. Akbar Khan contacted the officers of the Company who refused to enter upon any direct negotiations with him. On 3-2-1972 at 5 p.m. the workers gathered outside the factory, when Mr. Shafique Ahmed Khan, S. D. M. Harbour happened to be on the round of the Industrial Area at the time. Seeing them gathered outside the factory he enquired of them the reasons for it. He then went inside the factory and saw the Management. It is alleged that on his intervention and persuasion the company aid the Union agreed to refer the matter to the arbitration of Mr. Mairaj Muhammad Khan. The respondents ware advised to give their demands again in a consolidated form so that the same may be referred to arbitration. Accordingly on 6-2-1972 they resubmitted their charter of demands with a covering letter addressed to the Deputy Commissioner. Its copy was also handed over to the company on the 8th of February, 1972. In pursuance thereof on the 10th February, 1972 when the parties appeared before the Labour Minister, Mr. Mairaj Muhammad Khan was also present. He advised that the parties should first go to the Conciliation Officer for conciliation of the dispute and on the failure of the conciliation proceedings he will arbitrate between them under section 31 of the Industrial Relations Ordinance. The parties, therefore, contacted Mr. Musa Khan, the Conciliation Officer, and appeared before him in his office at 9 p.m. for the purpose of conciliation. But the conciliation failed and the parties formally agreed to refer their disputes to the arbitration of Mr. Mairaj Muhammad Khan. A memorandum of settlement to that effect was duly signed between the parties in his presence. It was denied on behalf of the respondents that the Management of the Company was gheraoed at any time or that the workers had attempted to molest the Pakistani Officers of the company or that the S. D. M. had without the agreement of the Management informed the workers that the matter would be referred to the arbitration. According to the respondents the company had voluntarily agreed to refer the dispute to the arbitration of Mr. Mairaj Muhammad Khan.

44. In the High Court in was suggested to the learned counsel for the appellant-Company to examine the arbitrator in support of his allegations but be declined to accept the suggestion and stated that he would simply rely on the record already available in Court. The High Court, however, examined Mr. Moosa Khan, Deputy Director Labour Welfare, Karachi as a Court witness on 4-4-1972. He deposed that both the parties had telephoned him at his residence and requested him to come to his office as they wanted to sign an agreement in his presence. They sent a car to fetch him from his residence. He accordingly came to his office at about 9 p.m. on 10-12-72 and found the representatives of both the sides present there. According to the witness both the parties told him that they had agreed to appoint, Mr. Mairaj Muhammad Khan as an arbitrator. They did not bring any signed settlement with them. The settlement was actually prepared in his office which was duly signed by the parties in his presence and he also countersigned it.

45. In the face of the conflicting versions by the parties, the statement of Mr. Moosa Khan is particularly helpful in arriving at the truth. According to both the sides he was admittelly present in his office at 9 p.m. on 10.2-197: when the impugned reference to arbitration was actually drawn up and executed between the parties. In fact he also countersigned the agreement between them. According to the judgment by the High Court it was suggested to the learned counsel for the appellant to examine Mr. Moose Khan in Court as his witness with a view to substantiate his allegations But be declined to accept the suggestion and stated that he would prefer to rely on the record already available in Court. In these circumstances the witness was examined as a Court witness and none of the parties chose to cross-examine him in spite of the opportunity allowed to them. It is in the affidavit of Mr. Henry James Lloyd, Production Director of the Company discussed above that even in the meeting in the office of Mr. Moose Khan, in his presence, the Legal Adviser of the Union had threatened them with dire consequences if they did not agree to the arbitration as suggested by the Union and it was then that the Management of the Company was compelled to agree to this reference to the arbitration of Mr. Mairaj Muhammad Khan. But no question in this behalf was put to Mr. Moose Khan if at all there was any truth in this allegation. It is difficult to conclude from the record that on or about 6-2-1972 Mr. Shafique Ahmed Khan, Asstt. Commissioner and S. D. M. Harbour, Karachi had on his own without the authority of the Company informed the workers that their dispute would be referred to the Labour Adviser to the President. At any rate owing to the events that followed there were further developments. Indeed the Chairman of the Company in his letter dated 10th February, 1972 addressed to Mr. Mohammad Hanif, Central Minister of Labour, stated that the Unions representatives had become extremely agitated and in view of their hostile attitude they felt compelled to accept their demand for arbitration, on the understanding that the arbitration shall be on legal issues involved strictly in consonance with the Labour Laws. Similarly the company in para. 16 of its concise written statement admitted that in view of the compelling circumstances, and subject to certain conditions, it was obliged to agree on 10-2-1972 before Mr. Mairaj Muhammad Khan to appoint him as the arbitrator under section 31 of the Industrial Relations Ordinance and therefore signed the agreement of reference to his arbitration. In this connection the Company in paragraphs 16 and 17 of its written statement filed before the arbitrator admitted that the Union did not agree to the terms of reference proposed by the Company and demanded arbitration under section 31 of the Ordinance. It was pointed out to the Union that demands placed vide their letter dated 6-2-1.972 had not been put before the Conciliation Officer and it was then agreed that both the parties would approach Mr. Moosa Khan, Deputy Director Labour Welfare, Government of Sind. The parties therefore approached him and after discussion the memorandum of settlement dated 10-2-1972 was arrived at and duly signed in his presence.

46. From this sequence of events narrated by the Company in its own written statement I have no hesitation in holding that this reference to the arbitration of Mr. Mairaj Muhammad Khan was made with the free consent of the parties. To me it appears that in spite of its initial hesitation and reluctance. the company eventually decided upon and was agreeable to the reference to arbitration by ? Mr. Mairaj Muhammad Khan.

47. The industrial laws in themselves provide for strikes and lock-outs an take care of the stresses and strains that are bound to develop in their working. In the process of negotiation and conciliation of industrial disputes some sort of pressures are inevitably built up by one or both the parties in the bargain. indeed the method of persuasion, involves the use of legitimate pressures some of which are intrinsic in industrial disputes. In every dispute personal considerations, social, political and economic factors do count and go to influence one or the other party in arriving at a negotiated settlement. Under section 30(3) of the Ordinance, in the conciliation proceeding, the Conciliator may suggest to either party to the dispute such concessions or modifications in their demand, as are in his opinion, likely to promote an amicable settlement of the dispute. . Indeed in this connection the task before a mediator or conciliator is well illustrated by Edger L. Warren of the University of California (Los Angeles) in his Article on "Mediation and Fact Finding", Chapter 22 (reproduced at page 251 of Labour Laws and Practice by Kothari). He says :

48. 'Perhaps the most potent factor determining the pressures which ma) be exerted in the mediation is the comparative economic strength of the two parties. If, tire Union is particularly weak because of a loose labour market and a deficient Union treasury for example, there is light pressure on the employer to make concessions. Under these circumstances the mediator's only recourse for settlement may be to convince the Union that it will not be able to carry on a successful strike. Similarly in the tight labour market and where a loss of production is costly to the employer a small show of strength by the Union may result in major gains. If, however the strength of the two parties is in approximate balance, the mediator may be able to channel pressures for most effective results. Thus the mediator may get employer's customers to insist on the importance of an early settlement so that they will not be deprived of that supplies. In the case of a Union where the substantial degree of public interest is involved the mediator may point out the postponement of the strike is the only way to avoid a government injunction - . . . . . A good deal of the mediator's effectiveness in dealing with economic pressures will be based on his ability to make a realistic appraisal of possible future trends and the comparative economic positions of the parties."

49. It is no wonder that compelled by the force of circumstances that prevailed in the instant case, the appellant finally decided voluntarily to abide by the arbitration of Mr. Mairaj Muhammad Khan and also actually participated in the proceedings before him. Hut this would be far from holding that the arbitration agreement was obtained from the company under coercion and by intimidation. This plea has, therefore, no force and is repelled.

50. It was next strongly contended before us on behalf of the appellant, Company that at any rate this reference to the arbitration of Mr. Mairaj Muhammad Khan was invalid and that the parties did not have any capacity to make the reference without having complied with the requirements of sections 26 to 31 of the Ordinance. In this connection just to recapitulate it tray be stated that according to the affidavits filed by Mr. Akbar Khan for the Worker's Union on the Nth of January 1972, he had personally handed over a charter of these demands made on behalf of the factory workers to Mr. Abidi. Factory Manager with the request to negotiate for their settlement. But on the 22nd of January 1972, Mr. Abidi informed him that the Company was neither prepared to negotiate nor settle the dispute and threatened that if the Union precipitated any action in pursuance thereof the Company shall terminate the services of its entire Managing Committee. It is alleged that on this Akbar Khan along with Iqbal Ahmad went on hunger strike on 24-1-72. On this on the 26th of January 1971, Mr. Said Hassan, M. P. A. intervened and persuaded them to call off the strike on the assurances advanced on behalf of the Company for a settlement. But the Company afterwards backed out and refused to negotiate. In these circumstances at about 5 p.m. on 6-2-1972 the workers gathered outside the factory to know about the fate of their negotiations with the Company. At the time Mr. Shaft Ahmad Khan S. D. M. Harbour was on a round of the industrial area. On seeing them he enquired from the workers the reason for the gathering. He then saw the Management of the Company inside the factory. It is alleged that on his persuasion the Company and the Worker's Union agreed to refer their demands to the arbitration of Mr. Mairaj Muhammad Khan. Accordingly on 6-2-72 a charter of these demands were resubmitted and a copy of the same was also handed over to the Company on 8-2-72.

51. The Company denied having received the charter of these demands at any time prior to 8-2-72. It was however admitted that on the 8th of February 1972, a copy of the Union's letter addressed to the Deputy Commissioner, Karachi was delivered to them by hand enclosing therewith a charter of these demands. A memorandum signed between the parties (pages 472-473 of the paper-book) and countersigned by Mr. Mairaj Muhammad Khan shows that the parties met in a joint meeting held on 10-2-1972 and agreed to the arbitration under section 31 of the Ordinance. They denied to approach the Conciliator and then Mr. Mairaj Muhammad Khan entered upon the reference.

52. From the statement of Mr. Moosa Khan, Deputy Director, Labour Welfare, Karachi recorded in the High Court on 4-3-72 it is evident that he did not receive any notice under section 28 with a view to initiate proceedings under section 30 of the Ordinance. According to him both the parties ,contacted him on telephone at his residence and they requested him to come to his office as they wanted to sign an agreement. in his presence. He came to his office where both the parties were present. It was 9 p.m. on 10-2-1972. The parties told him that they had agreed to appoint Mr. Mairaj Muhammad Khan as their sole arbitrator. An agreement to that effect was prepared in the presence of the parties and was signed by them and he also countersigned the same.

53. This reference to arbitration was made on 10-2-1972 under the Industrial Relations Ordinance, 1969 as in force at the time. Section 26 of the Ordinance provides for a demand notice and amicable settlement of the dispute by negotiation, if possible. In case of failure of the negotiations, under section 27-A in force at the time the employer or the Collective Bargaining agent may report to the Conciliator that the negotiations have failed and request him in writing to conciliate in the dispute and the Conciliator shall, on receipt of such request proceed to conciliate in the dispute. Section 2h lays down that if the Conciliator fails to settle the dispute within ten days from the date of receipt of request made under section 27-.A, the Collective Bargaining Agent or the employer may, in accordance with the provisions of the Ordinance,, serve on the other party to the dispute 21 days notice of strike or lock-out. Under section 29, where a party to an industrial dispute serves a notice of strike or lock-out under section 28, it shall, simultaneously with the service of such notice, deliver a copy thereof to the Conciliator who shall proceed to conciliate or, as the case may be, continue to conciliate in the dispute notwithstanding the notice of strike or lock-out. Section 30? deals with the proceedings before the Conciliator. He shall as soon as possible call a meeting of the parties to bring about a settlement between them under this section. If however, no settlement is reached and the conciliation fails, then the Conciliator shall try and persuade the parties to, agree to refer the dispute to an arbitrator. In case the parties agree, they shall make a joint request in writing for reference of the dispute to an arbitrator agreed upon by them in accordance with the provisions contained in subsection (t) of section 31 of the Ordinance.

54. In this context section 28 embodies an important provision. It is only, after the notice of strike or lock-out, as the case may be, has been served by one party to the industrial disputes on the other under this section and after its copy has been delivered to the Conciliator in accordance with section 29, that he assumes jurisdiction to proceed to conciliate and try to bring about a settlement between them as envisaged in section 30 of the Ordinance. In this connection section 41(1) expressly lays down that a conciliation preceding is deemed to have commenced on the date on which a notice of strike or lock-out is received by the Conciliator under section 28. The receipt of this notice is sine qua non and the signal for the Conciliator for the commencement of the conciliation proceedings before him. Alternatively he has not jurisdiction at all to enter upon conciliation proceeding in the absence of any offer of strike or lock-out served by one party to the dispute on the other and copy delivered to the Conciliator in accordance with the requirements of sections 28 and 29 of the Ordinance. It Is also self-evident that there could be no failure of the conciliation proceedings without having commended them, In terms the provisions of subsection (1) of section 31 relating to the appointment of an arbitrator between the parties to the dispute are attracted only on the failure of the conciliation proceedings. As such in the absence of the failure of the conciliation proceeding the appointment of the arbitrator is not warranted by the provisions of the Ordinance.

55. But in the instant cafe before us no such strike notice was served b4 the Worker's Union on the Company. Nor was any copy thereof at alt delivered to the Conciliator in compliance with the mandatory requirement (if section 29 of the Ordinance. As such there was no valid commencement of the conciliation proceedings in this case. In this connection Mr. Moosa Khan, Deputy Director Labour Welfare, as the duly appointed Conciliator," admitted in his evidence before the High Court that he did not receive any such notice with a view to initiate proceedings under section 3019 the Ordinance. In its absence the jurisdiction of the Conciliator was not lawfully invoked by the parties. Nor was this initial defect cured by the Conciliator simply countersigning the agreement dated 10-2-72 executed between the parties for reference to the arbitration of Mr. Mairaj Muhammad Khan. In countersigning the agreement the Conciliator did not actually enter upon any conciliation proceedings and the reference to arbitration was not trade in pursuance to the provisions contained in sections 30 and 31 ?f the Ordinance. In this connection I am in agreement with the High Court in holding that this reference to arbitration was, therefore, invalid.

56. In Ramington Rand of Pakistan Ltd, v. The Islamic Republic of Pakistan P L D 1957 S C (Pak.) 170 ? in a case arising under the Industrial Disputes Act XIV of 1947, the Court observed that the conciliation proceedings do not at all commence when the Conciliation Officer intervenes in a dispute and section 12 otherwise than on receipt of a notice of strike or lock out under section 22. In the reported case of Hourly Paid Employees' Association Regd, Rahimyar Khan v. Lever Brothers (Pakistan) Ltd. 1962 P L C 371 under a similar provision in section 16 (1)(a) of the Industrial Disputes Ordinance, 1959, it was held that the Conciliation Officer is not justified and has no jurisdiction to initiate cancellation proceedings in the absence of a strike notice. Similarly in Batn Mazdoor League Batapur, Lahore v. Rata Shoe Co. Pakistan Ltd. 1962 P L C 795 it was held that the Conciliation Officer had no jurisdiction to issue certificate of failure without complying with the provisions relating to conciliation proceedings. A certificate of failure issued in the case of a public utility preview without a strike notice under section 18 of the Industrial Disputes Ordinances 1959, was held to be bad in lay. and the Court had no jurisdiction to adjudicate pan the dispute referred to it. In this connection, according to the judgment of the High Court under appeal, it was conceded by the learned counsel for the respondents that the reference to arbitration is rendered illegal for non-compliance with those preliminary steps.

57. In connection with the above before us the learned counsel for the respondents relied on reported case of Marker Employees' Union v. Marker Alkaloids Ltd. 1976 S C M R 82 to contend that the provisions of a notice in a beneficial statute, such as this Ordinance, should not be equated with similar provisions in laws dealing with rights in property. In that case it was held that year it a demand notice under section 26(1) of the Ordinance is ruled out, that. does not ipso facto render the strike notice given undo section 26(3) of the Ordinance illegal. Also in the opinion of the Court the period of 10 days prescribed in subsection (3) of section 26 for bilateral negotiations and period of 7 days in subsection (3) for service of a notice of strike, are intended to infuse a sense of urgency amongst the parties to the industrial dispute and there was no indication in the Ordinance that if the time schedule laid down in section 26 is not conformed to strictly, the entire process laid down in that section for the settlement of industrial disputes will fall through. In my opinion that case is distinguishable on facts. Ira that case admittedly a strike notice was served on the employer though late and in that context the provisions of section 26 of the Ordinance came under discussion before this Court, and it did not deal with the interpretation of sections 28 to 31 of the Ordinance. In the instant case there was no strike notice at all required under sections 28 and 29 of the Ordinance, which amounted to a jurisdictional defect as already discussed above.

58. Before parting with this part of the case, in this connection I deem it necessary to advert to the findings of the High Court reproduced as under :

59. "Since the reference to arbitration in the present case was invalid, it cannot be treated to be a reference in pursuance of section 31 and, therefore, the provisions of this section are inapplicable to the proceedings before the arbitrator and the award made by him. Indeed, the parties intended it to be a reference under that section with all the consequences but if law produced a different result, the intention assumes a secondary consideration and it is the effect of law which prevails. Consequently, on this score also the arbitration cannot be held to be statutory."

60. In this connection, while I agree with the High Court in holding that the reference to arbitration in the present case was invalid and contrary to the requirement of section 31 read with sections 28 to 30 of the Ordinance, I regret to find that there was no justification in observing that the agreement of the parties nonetheless remained valid as a private arbitration only. In this connection the High Court was fully conscious that the parties had indeed intended it to be a reference under section .31 of the Ordinance. Even otherwise there is unimpeachable evidence on the record to establish that the parties by common consent intended to appoint Mr. Mairaj Muhammad Khan as the sole arbitrator for the settlement of the industrial disputes between them in accordance with the requirements of section 31 of the Ordinance. There was no agreement between the parties to refer their disputes to arbitration under the Arbitration Act. To hold that the agreement of the parties remained valid as a private arbitration amounts to substitution into the terms of the agreement without the consent of the parties. The parties bad agreed to make the reference only under section 31 of the Ordinance. There was this consensus ad idem between them and if failed to achieve that object then by no process of reasoning it could be held valid as a reference under the Arbitration Act. Indeed if the intention of the parties could not be effected then there may be the frustration of the contract between them.

61. In this connection the observations in American Jurisprudence, Vol. 3, at pages 838-839 are quite pertinent and are usefully reproduced below ;

62. "An attempt to enter into a statutory arbitration, which fails because of non-compliance with some essential provisions of the statute, cannot be made effective as a common-law submission, for the law will never make a contract for the parties, though in carrying their intentions into effect, mere deficiencies in matters of form may sometimes be disregarded."

63. As already discussed above, in this case the parties did not have the capacity to enter upon the reference and confer jurisdiction on the arbitrator in agreeing to his appointment as such under section 31 of the Ordinance, without having complied with the requirements of sections 28 and 29. In the circumstances his appointment was ab initio void and invalid. He bad no jurisdiction to enter upon the reference and his award was a nullity in the eye of law. The appellant-Company cannot be held to have waived this objection which goes to the root of the case but was not raised, before the arbitrator. It was; therefore, entitled to the declaration under Article 98 of the Constitution. In Chhabba Lal v. Kallu Lal anal others AIR 1946 PC72 their Lordships of the Privy Council observed that it there is no valid) reference, the purported award is a nullity and can be challenged in any appropriate proceedings Under the Indian jurisdiction in Chinoy Chalani & Co. and others v. Y. Anjiah A I R 1958 Andh. Pro. 384 it was held that a distinction must always be drawn between elements which are essential for the foundation of jurisdiction and the mode in which such jurisdiction has to be assumed and exercised. Where there is jurisdiction over the subject-matter but only noncompliance with the procedure prescribed as an essential for the exercise of jurisdiction, the defect might be waived but the same may not be said in a case where there is inherent lack of jurisdiction. The arbitrators therefore can make a valid award only if they are duly appointed according to rules which the parties have to abide by and have thus acquired jurisdiction.

64. The Company in its written statement filed before the arbitrator raised an objection to the effect that those demands of the Union which were already covered by a memorandum of settlement arrived at between the parties could not be re-agitated during the period of its validity. This objection was inter alia raised in the context of Demand No. 1(a) preferred by the Worker's Union for the re-instatement of Mr. Akbar Khau, Fazle Rahim and Taza Gul with full back pay and ail other benefits. The Company alleged that these three employees were lawfully discharged from service on 8-1-1964. The Union took up their cause and raised a number of demands including the one for their re-instatement with the Company.

65. On the failure of the negotiations the Union unsuccessfully referred the dispute to the industrial Court at Karachi. Eventually the Union filed an appeal against the order of the Industrial Court before the High Court at Karachi. In course of time the Company entered into further negotiations with the Union and on the 13th of March 1969, an agreement was reached between them and they executed a memorandum of settlement which was also authenticated by the Joint Director, Labour Welfare, Karachi. Akbar Khan, whose re-instatement was being sought under this demand, was himself a signatory to this settlement in his capacity as the General Secretary of the Union. It was agreed vide clause 2 of this Agreement that the Company shall make ex gratia payment of Rs 4,000 to each of these workers as compensation for loss of their employment. In addition they shall be paid their full provident fund, gratuity and all other dues to which they will be entitled, In consequence thereof the Union agreed to withdraw their appeal against the Company from the High Court at Karachi. In spite of these payments made to them by the company the Union did not withdraw the appeal from the High Court. Afterwards as a result of fresh negotiations between the representatives of the parties before the Conciliation Officer, on the 19th of October 1971, another memorandum of settlement was signed between them and authenticated by the Conciliator. Under clause 9 of this memorandum the Union again agreed to withdraw its Appeal No. 76 of 1966 for their re-instatement periling in the High Court. This agreement was also signed by Mr. Akbar Khan in his capacity at the President and by the Vice President and the General Secretary of the Union. In pursuance to this agreement the General Secretary of the Union, Mr. Saleh Muhammad, along with the Company's representatives appeared before the High Court with an application for withdrawal of the pending appeal filed by the Union The High Court accordingly dismissed the appeal as withdrawn. It was therefore alleged by the Company that Messrs Akbar Khen, Fazle Rabim and Taza Gul were discharged from service some eight years back and they received their gratuity, provident fund and all other dues from the Company in full and final settlement of their accounts. In addition to this ex gratia payments of Rs. 4,000 each were also made to them by the company as compensation for the loss of their service in accordance with the two memorandums of settlements. The Company therefore submitted before the Arbitrator that the demand made by the Union for their re-instatement was wholly misconceived.

66. In reply the Workers' Union in its written statement filed before the Arbitrator contended that the services of these three office-hearer:: of the union were illegally terminated on 8-1-1964 without any show-cause notices issued to them. The Union, therefore, served a strike notice on the Company for their : e-instatement. The conciliation proceedings taken in pursuance thereof failed and the union then applied to the Industrial Court for adjudication on their demand made in this respect. But the Industrial Court refused to interfere can a technical objection raised by the Company. The Union then filed the Misc. Appeal No. 76 of 1966 against the order in the then High Court of West Pakistan, Karachi Bench at Karachi on the 20th of July 1966. According to the Union the private and stealthy agreement dated 13th of March 1969, was forced upon the workers under duress and coercion by illegal lock-out of the workmen on the 8th of March 1969, which was lifted only after the signatures of the office-bearers of the Union had been obtained on it. This agreement was made against public policy and was not binding on the Union. It is further alleged by the Union in its written statement that the Management again resorted to the same. repressive methods and obtained the signatures of Akbar Khan and Saleh Muhammad on another agreement under gherao on the 19th of October 1971, with the help of 11 named hired agents including Mir Rehmar and Salim Fitter. It was averred that even otherwise under Regulation No. 6 of the Governor's directive dated 6th of January 1972, all agreements made by employers under gherao were declared to be null and void. According to the Union in these circumstances, the two memorandums of settlements, on which the company relied, did not bind the Union and its workers.

67. The Company in its rejoinder filed before the arbitrator denied that the office-bearers of the Union were victimised or their services were illegally terminated. The Company denied that the memorandum of settlement dated 11-3-1969 was procured stealthily under duress and coercion and was not binding on the respondents. The Company also denied having obtained the signatures of Messrs Akbar Khan and Saleh Muhammad on the memorandum of settlement dated the 19th of Oatobar 19711, under gherao through hired agents. In this connection the Company point ? out that the so called hired agents. in whose presence the agreement was reached, wart none else but the members of the Managing Committee of the Union who had come to negotiate with the Company and that Mr. Saleem Fitter was the Office Secretary and Mir Rehman the organizer of their Union. In the opinion of the Company the Union had deliberately distorted farts with a view to mislead the Arbitrator. The Company denied that Messers Akbar Khan. Fazle Rahim and Taza Gut were dismissed from service for misconduct or for Trade Union activities during the pendency of any industrial dispute and that their removal from service was illegal.

68. The Arbitrator in his impugned award held that Messrs Akbar Khan, Fazle Rahim and Taza Gul were victimized because of the differences that arose on account of the failure of the Company to implement the lead Scheme introduced for the benefit of the workers. They were dismissed from service for Trade Union activities during the pendency of conciliation proceedings and their dismissal was ab initio illegal. The Union therefore took up their cause and raised the dispute with the Company against their wrongful removal from service. But the conciliation proceeding started between the parties failed on 26-2-1964. 'The Union then applied to the then West Pakistan Industrial Court, Karachi for adjudication of this and the other disputes between the parties. But on 31-.5-1966 on an objection raised by the Company, the Industrial Court declined to entertain the demand and adjudicate upon the same on .a technical objection raised by It. The validity of the order made by the Industrial Court was challenged by the Workers Union in the then High Court of West Pakistan, Karachi ,Bench in Misc. Appeal No. 67 of 1966 filed on 22-7-1966. In this connection. the Arbitrator observed that although according to clause (2) of the: memorandum of settlement dated 13-3-09 the Union had agreed to withdraw the appeal from the High Court, but the appeal was not actually withdrawn and remained pending till November 1971, for unexplained reasons. According to the Arbitrator a certified copy of the order passed by the High Court in the appeal was not produced before him and even the number of this appeal to be withdrawn was not specified in the agreement dated 13-3-69. The Arbitrator therefore doubted if this agreement had anything to do with the Misc. Appeal No. 67 of 1966. In tile opinion of the Arbitrator while a mention of Appeal No. 76 of 1 966 was made in the agreement dated 19-10-71 but conspicuously there was no specific mention about it in the agreement dated 13-3-69. In the circumstances the arbitrator did not find it safe to rely on this agreement to hold that the union had agreed to withdraw this appeal against the Company from the High Court. The Arbitrator agreed with the contention that the memorandum of settlement dated 13-3-69 was procured under duress and that the memorandum of settlement dated 19-10-71 was arrived at under "gherao" of the office-bearers of the Union. In the opinion of the Arbitrator these were never made in accordance with law and that their copies were not sent to the appropriate authorities. As such no sanctity could be attached to them. Moreover according to the Arbitrator the parties were bound by their present agreement to refer this dispute for the re-instatement of the three victimised workers try his arbitration. He also relied on the order dated 6-1-72 issued by Mr. Mumtaz Ali Bhutto, the then Governor of Sind to the effect that all agreements made by employers under "gherao" shall be deemed to be null and void. In conclusion the Arbitrator held that the two memorandums of settlements dated 13-3-69 and 19-10-71 in question were not at all binding on the Union and its workers. He held that the services of Messrs Akbar Khan, Taza Gul and Fazle Rahim were dispensed with on account of Union activities and that the Union was not debarred from re-agitating for their re-instatement. He therefore ordered their re-instatement in service with full benefits, pay and other dues to be paid to them.

69. As already mentioned above, in the opinion of the High Court this reference to arbitration could not be considered to 511 a reference under section 31 of the Industrial Relations Ordinance and treated tile award merely as a private award made between the parties under the Arbitration Act. In this connection the Court observed that the Arbitrator has held that the two previous memorandums of settlement of the years 1969 and 1971 were procured under pressure and undue influence by the Company and that this finding by the Arbitrator ore a disputed question of fact was final and could not be questioned in the proceeding under the writ jurisdiction. the High Court also observed that the objection that this reference to the arbitration of Mr Mairaj Muhammad Khan was invalid and did not comply with the requirements of sections 26 to 31 of the Ordinance, wars riot raised before the arbitrator and that therefore the Company must be deemed to stave waived it. Even otherwise according to the High Court on this ground no writ could be issued at the instance of a petitioner who had failed to raise this objection in the first instance before the concerned authority. The High Court on going through the record of the arbitration proceedings repelled the contention advanced before it on behalf of the Company to the effect that the Arbitrator had failed to afford any opportunity to them do produce their evidence. According to the High Court the parties were satisfied with the material produced before the Arbitrator in the form of documents and they did not choose to examine any witnesses before him. As such the Arbitrator could not be held responsible for any failure on the part of the parties to adduce any evidence before him. The Court also repelled the contention of the Company to the effect that award was based on no evidence or that it was vitiated by any error apparent on the face of the record. At the bearing before the High Court, on the merits of the award the Company assailed the findings of the Arbitrator in respect of Demands Nos. 1, 1(a), l(b), 1(c) and 4. In conclusion the High Court declined to interfere with the finding and the award of the Arbitrator.

70. Before us in this Court the Company strongly relied on the two memorandums of settlement dated 13-3-69 and 19-10-1971 executed between the parties. It was argued that during the period of validity of the last mentioned agreement between the Company and the Workers' Union no fresh demand having financial implications could be raised by the Union. In this connection the Company on its rejoinder filed before the Arbitrator adequately repelled and denied the allegations raised by the Union in its written statement filed before him to the effect that the two memorandums of settlements were procured by the Company from the representatives of the Union by intimidation, under pressure and gherao, and were invalid.

71. In the written statement of the Union filed before the Arbitrator signatures of its representatives on the two memorandums of settlement, dated 13-3-69 and 19-10-71 were not denied. Therefore, the onus rested heavily on the Union to establish that these were procured under pressure, intimidation and duress. But the Union, beyond the bare allegations in its written statement, did not produce any evidence in support of this plea. Nor has the Arbitrator even adverted to any such evidence in his impugned award in support of his findings on this point. Indeed in this case the parties did not choose to produce any oral evidence before the Arbitrator and merely relied on their pleadings and documents produced before him on either side, The documentary evidence produced by the Union was altogether silent on this part of its case. Therefore, in the absence of any evidence, the Arbitrator merely acted on conjectures and unwarranted assumptions in favour of the Union, in striking down the two agreements by holding that they were procured from the office-bearers of the Union by gherao and under duress.

72. In its written statement the Union alleged that the memorandum of settlement dated 19-1071 was obtained from the two office-bearers of the Union namely Messrs Akbar Khan and Saleh Mohammad under "gherao" with the help of eleven hired agents chose names are also mentioned. But in the rejoinder the Company denied the allegation and explained that eight of those named workers were none else than the; members of the Managing Committee of the Union. Muhammad Salim Fitter was their office Secretary and Mir Rehman ? was the Organizer of the Union. Nothing could be easier for the Union to have produced some of those workers before the Arbitrator in support of its allegations. The Union even failed to examine Akbar Khan and Saleh Mohammad, two of its office-bearers in this connection.

73. In its written statement the Union did not even allege that the copies of the two memorandums of settlements in question were rot sent to any of the prescribed authorities or that they were contrary to any specific provisions of the Ordinance. But surprisingly the Arbitrator has gone on to hold that theses agreements were not made in accordance with law and no sanctity could be attached to them and at no stage of the proceedings before the Arbitrator the Company was even called upon to meet this case.

74. In conclusion I find that in this connection the award made by the Arbitrator is based on conjectures and surmises and on no evidence in setting aside the two memorandums of settlement executed between the parties on 13-3-1969 and 19-10-1971 and is not binding on them. In consequence the Arbitrator altogether failed to consider the effect of these settlements on the various demands raised by the Union against the Company.

75. Above all in this behalf, in connection with Demand No. 1(a) relating to the re-instatement of Messrs Akbar Khan, Fazle Rahim and Taza Gul, the Arbitrator has failed to even advert to a most material aspect of the case. The Company in its written statement filed before the Arbitrator pleaded that they were removed from service in 1964. After their discharge the Union put up the demand for their re-instatement in service and the matter was taken to the industrial Court, but their application was dismissed. They then filed an appeal against the order before the then High Court of West Pakistan (Karachi Bench), Karachi. Afterwards the Company entered into negotiations with the Union. Accordingly on 13-3-1969 an agreement was arrived at between the parties which was reduced to the form of a memorandum of settlement executed between them. Mr. Akbar Khan, whose re-instatement vas sought, was himself a signatory to this settlement in his capacity as the General Secretary of the Union. Under clause (2) of the memorandum the Company agreed to pay full provident fund, gratuity and other dues to which these discharged workers were entitled. The Company also agreed to pay ex gratis payment of Rs. 4,000 to each of these discharged workers as compensation for the loss of their employment and in consequence thereof the Union .agreed to withdraw their appeal from the High Court at Karachi. The Company made the payments duly accepted by the discharged workers against receipts executed by them. It is further alleged by the Company in its written statement that on 19-10-1971 another agreement was recorded between the representatives of the Union and the Company which was also reduced to writing in the form of the memorandum of settlement. It was again signed by Mr. Akbar Khan in his capacity as the President of the Union and by the Vice President and the General Secretary of the Union. Under clause (9) of this memorandum the Union again agreed to withdraw its Appeal No. 76 of 1966 from the High Court in accordance with clause (2) of the agreement reached between them on 13th March 1969 as all their disputes between them stood finally resolved.

76. In this connection in the written statement filed by the Union before the Arbitrator, except for the allegation that the two memorandums of settlements an question were obtained t)y the Company from its office-bearers by gherao and under duress The Union did not deny the other allegations as to the payments made to these ex-employees in lieu of their gratuity, provident fund and other dues and also the ex gratia payments made to them as compensation for the loss of their employment. But strangely enough the Arbitrator did not even advert to this material aspect of the case and the documentary evidence produced by the Company in support of the allegations.

77. In consequence of these payments made to the discharged workers the Union agreed to withdraw its appeal filed in the High Court for their re-instatement in service vide memorandum of settlement dated 13-3-69. But despite this agreement the Union did not actually withdraw the appeal for sometime. In the memorandum of settlement dated 19-10-71 the Union again agreed to withdraw Appeal No 76 of 1966, from the High Court. Reading :these two agreements together there can be no doubt left that the Union had .agreed to withdraw Appeal No. 76 of 1966 about the re-instatement of these discharged employees from the High Court. But in this connection the approach by the Arbitrator, to say the least on the face of it, is unintelligible, illogical and highly perverse, and is based on a traversity of seasonings.

78. On these facts and circumstances, I have no option but to conclude that in making his award the arbitrator misconducted himself and the proceedings before him in all these respects.

79. There is little doubt that in accordance with section 3 read with clause (7) of the First Schedule to the Arbitration Act, 1940 it is an implied term of an arbitration agreement, unless different intention is expressed therein, that the .award made by the Arbitrator shall be final and binding on the parties and persons claming under them. Similarly according to section 31(5) of they Industrial Relations Ordinance, 1969, the award made by an Arbitrator appointed by the parties in an industrial dispute is final and no appeal shall lie against it. In Selley v. Whit Bread & Co. (1917) 1 K B 736, it was observed that the; Court should approach an award with a desire to support rather than destroy it. It is all the more desirable in cases relating to the settlement of industrial disputes that the Court should be slow to interfere with the award made by an Arbitrator voluntarily appointed by the parties. This sanctity of course is attached to an award made in accordance with law.

80. Section 46 of the Arbitration Act is made applicable to every arbitration) under any other enactment for the time being in force. It lays down that the provisions of the Arbitration Act. except subsection (1) of section 6 and sections 7, 12, 36 and 37. shall apply to every arbitration under any other enactment for the time being in force, as if the arbitration was pursuant to an arbitration agreement except in so far as that Act is inconsistent with that either enactment or with any rules made thereunder. In suitable cases under this section read with section 30 of the Arbitration Act the validity of an arbitration award made under any other enactment can be challenged, unless) there is something to the contrary in the other enactment. Section 30 of the Arbitration Act inter alia expressly lays down that an award may be set aside on the ground that the Arbitrator has misconducted himself or the proceedings.

7. Russel on Arbitration (Seventeenth Ed.) at page 307 has observed on the authority of In re : Jhones and Carter (1922) 2 Ch. 599, that section 23(2) of English Arbitration Act, 1950 (which corresponds to section 30(2) of Arbitration .Act, 1940 in force in this country) extends to statutory arbitrations, where statute concerned does not exclude it. Even where the section is excluded, however the High Court still has inherent jurisdiction to set aside an award .bad, on its face, unless that too is excluded. In this connection the learned ,author in his invaluable treatise has further observed at page 133 that the .obligation to act fairly as between parties to a dispute binds statutory arbitrators as well as arbitrators under a submission, whether the Acts apply or not for it binds all persons performing judicial and quasi-judicial functions. Where the Acts do not apply, however, there can be no setting .aside on motion to the Court: the proper remedy for injustice will be by application for prerogative order, or by whatever equivalent procedure is laid down by any statute governing the tribunal concerned. In the instant case no remedy is provided by the statute to challenge the validity of the two awards in question. Therefore, in the absence of any alternative remedy, the Company filed the Constitutional Petition in the High Court to question their validity. the term misconduct used in connection with arbitration does no necessarily imply anything in the nature of fraud or moral turpitude. In the judicial sense the misconduct of an Arbitrator means his failure to perform his essential duty, resulting in substantial miscarriage of justice between the parties. According to Atkin, J. in Williams v. Willis 83 L J K B 1296, the words "misconducted the proceedings" means such a mishandling of arbitration as is likely to cause some substantial miscarriage of justice. In the American Jurisprudence Vol. 3 on pages 964-5 it is observed that awards which are valid on their faces may be set aside in equity for misconduct on the part of the arbitrators, and the extrinsic evidence is admissible to prove such misconduct Conduct inconsistent with the duties imposed upon those selected as the arbitrators, either at the hearing, or in reaching their conclusions will frequently constitute misconduct as will impeach an award.

81. I shall now turn to the other award made by the Arbitrator in favour of respondent No. 4, Field Staff Union Brooke Bond (Pakistan) Limited, Karachi. This Union purports to be the only Trade Union of workmen representing the field staff of the company mainly consisting of the salesmen, vanmen, coolies (Tikka), peons and the other clerical staff. This Union placed as many as 26 demands on the Company but only two of these, reproduced above in the beginning of this judgment, are relevant for the purposes of this case. Under the first demand the Union claimed fur the award of consolidated salary scales for salesmen, vanmen and other field staff of the Company with effect from 1-1-1969. But in the written statement filed before the Arbitrator the Company raised an objection that the Field Staff Union could not lawfully represent the salesmen and vanmen, who are not "workmen" within the definition of the term. According to the appellant a salesman in this Company is not a salesman at the strop counter. lie is exclusively engaged in the field of distribution and sales, earning commission on such sales, and in view of the nature of his duties and responsibilities, he cannot be classified as a workman. The salesmen in this Company are mobile salesmen with responsibilities for stocks, sales and general business of the Company in their respective areas. They operate independently and a vanman is provided to perform all manual work required under him. According to the appellant a salesman in this Company is a well paid employee. The average monthly earnings of a salesman in the Company in the year ended June 1971 came to Rs. 655 per salesman in the Karachi Branch and Rs. 535 per month on West Pakistan basis. Since 1st July 1971 a salesman's basic remuneration was increased by Rs. 22 per four weeks (Rs. 23.83 per month). This and the other improvements in their terms and conditions of service gave them a total direct or indirect benefit of Rs. 50 per month. Commission on sales is the major source of a salesman's earnings. There is no upper limit on the commission and the monthly earnings of a local salesman in Karachi have gone up to about Rs. 1,000 per month. According to the Company the salary scales and all other benefits extended to sales staff are ahead of those extended to similar staff of other competitors and, in fact, the staff of their main competitors have recently demanded that their terms be improved to match those enjoyed by its sales staff. It was alleged in the written statement that the dispute as to whether a salesman in the Company is a workman was already sub judice in the Labour Courts at Karachi and Peshawar. It was therefore, submitted before the Arbitrator that this important legal matter, which has a definite bearing on the structure of the existing sales department of this and the other companies might be left to the decision by the Courts of law.

7. Respondents Nos 3 and 4 in their joint written statement filed before the Arbitrator controverted these allegations and asserted that the salesmen and vanmen in the Company are workmen within the definition of the term under the Industrial Relations Ordinance, The Field Staff Union was duly registered on the 17th of July 1969 with the Registrar of Trade Unions. It consisted of vanmen. salesmen and clerical and subordinate staff employed by the Company in the field and is their sole representative as their bargaining agent.

82. The Arbitrator in his award observed that the Field Stag Union Brooke Pond (Pakistan) Limited. is the only Trade Union representing the field staff of the Company in the Province of Sind. The field staff consisted of mainly the vanmen and salesmen. It is supervised, controlled and administered by the Sales Executives of the Company namely the General Sales Manager and Sales Director of the Company.

83. The Arbitrator relied on the statement of Mr. Bhutto, the General Sales Manager of the Company in defining the duties of salesmen. According to him the salesmen were incharge of the tea stocks entrusted to them. They have to sell tea and for this purpose they go from shop to shop to the dealers and hotelwalas carrying with them the stocks kept in the van. Sometimes they take the stocks on their own bicycles. They prepare cash memos in individual customer's name and collect the sale proceeds from him. They prepare daily and weekly statements of sales and receipts of stocks. In the evening they deposit cash in the banks and keep a--count. They open the depots in the early morning and after they have entered the withdrawals of the required stocks of tea from their respective depots they lock !heir depots and go out in the market in their area for sales duly accompanied by the vanman carrying the cart load.

84. In the opinion of the arbitrator all these duties performed by a. salesman are both clerical and manual. They do not supervise anybody's work but in fact are supervisors of their own work. The vanman pushes and carries the cast load of tea kept in the van and moves it from shop to shop to make supplies of the tea ordered in quantity and quality by the customers. Before the Arbitrator on behalf of the Company it was stressed that the salesman was solely engaged in the field of distribution and sales, earning commission on such sales and that having regard to the nature; of his duties rind responsibilities, he could not be classified as a workman. In this behalf, before the Arbitrator reliance was placed on the judgment of Supreme Court of Pakistan reported as Pakistan Tobacco Company v. Tobacco Company Employees' Union, Dacca P L D 1961 S C 403 and also on a Division Bench judgment of the High Court of West Pakistan in Chairman. Brooke Bond Co. (Pakistan) Ltd. v. General Secretary, Union Karkurrane Brooke Bond (Pakistan) Ltd. P L D 1969 Lah. 717. But in that connection the Arbitrator in distinguishing the two reported cases observed that the Supreme Court authority was based on the definition of tile term "workman" under section 2(s) of the Industrial Disputes Act, 1 947. Similarly the case before the Division Bench of the West Pakistan High Court arose under section 2(n) of the Industrial Disputes Ordinance, 1959. In conclusion the Arbitrator repelled the objection raised by the Company and held that a salesman in the Company was a "workman" within the definition of section 2(xxviii) of the Industrial Relations Ordinance. 1969. The Arbitrator found that the Field Staff Union was registered by the Registrar of Trade Unions, Karachi, under sections 7 and 8 of the West Pakistan Trade Unions Ordinance, 1968 having exclusive jurisdiction in the matter. This Trade Union existed as on the 13th of November, 1969 on the commencement of the Industrial Relations Ordinance, 1969 and its operation was saved and protected under section 67(2) (a) of the Industrial Relations Ordinance. Under section 22 (i) of the Ordinance this Union being the only registered Union of the Field Staff Workers of the Company must be deemed to be Collective Bargaining Agent for the workmen of the sale establishment entitled to represent them.

85. On the merits of the first demand raised by the Field Staff Union the Arbitrator fixed and awarded the pay scale of Rs X600-30-900 to the sales. men employed under the Company in Karachi and the area of the Province of Sind. He further directed that the present incumbents with the length of service shall be fitted in the pay scales according to their seniority as salesmen as under :

(i) Salesman having more than ?? ?????????????????????? Four advance increments in the scale

86. ??????????? 11 years but below 16. ??????????????????????????????????? as above.

(ii) To those who have put in ??????????????????????????? Three advance Increments in the scale

87. ???????? 10 years or more service ????????????????????????? as above.

88. (iii`) To those who have less ????????????????????????????? Two advance increments only.

89. ????? than 10 years but not below

90. ??????????? 5 years.

(iv) Less than 5 years but not ??????????????????????????? one advance increment.

91. ??????????? below 3 years.

(v) Less than 3 years ???????????????????????????????????????? No advance increment.

92. In respect of the category of vanmen/coolies the Management did not oppose their demand and the Arbitrator awarded the following salary scales to them

(a) Vanman ???????????????????????????????????????????????????? Rs. 250-15-325

(b) Cooly (Tikka) ??????????????????????????????????????????? Rs. 200-13-300

93. The Arbitrator awarded the above scales of pay to the salesmen, vanmen and coolies (Tikka) respectively with effect from 1-8-1969 only. He therefore directed that the arrears be paid to them after the necessary fixation within one month's period. At the same time the Arbitrator rejected this demand for the fixation of the salary scales for the clerical staff and the peons in the service of the Company.

94. Under Demand No. 2 the Arbitrator awarded the incentive remuneration for salesmen and vanmen based on sales targets on earnings at the following sates :-

95. Range of incentive sales ??????????????????????????????????????????????????????????? Incentive Remuneration

96. ??????????? per 4 weeks ???????????????????????????????????????????????????????????????? Salesman ????????? Vanman

97. ??????????? (a) Up to 300 Lbs. Sales. ???????????????????????????????????????????? - ????????????????????? -

(b) From 601 to 1000 Lbs. ?????????????????????????????????????????????????????? 8 paisa per lb ??? 5 paisa per lb

98. Range of incentive sales ??????????????????????????????????????????????????????????? incentive Remuneration per 4 weeks ???????????????????????????????????????????????????????????????????????????? Salesman ????????? Vanman

(c) From 1001 to 1500 Lbs. ???????????????????????????????????????????????????? 6 paisa per lb ??? 2 paisa per

(d) From 1501 to 2000 Lbs. ???????????????????????????????????????????????????? 5 paisa per lb ??? 2paisa per lb

(e) From 2001 to 3500 Lbs. ???????????????????????????????????????????????????? 4 paisa per lb ??? 2paisa per lb

(f) From 350 s to 5000 Lbs. ???????????????????????????????????????????????????? 3 paisa per lb ??? 1paisa per lb

(g) From 5011 to 7000 Lbs. ???????????????????????????????????????????????????? 2 paisa per lb ??? 1paisa per lb

(h) Over 7000 Lbs. ????????????????????????????????????????????????????????????????? 1? paisa per lb 1paisa per lb

99. In respect of the remaining Demands raised by the Union the Arbitrator left the matter open for mutual discussions between the parties.

100. The Company challenged the validity of this award as well. In fact the validity of the two awards made by the Arbitrator in favour of the respective Unions was challenged together before the High Court in the Constitutional Petition. Before the High Court the Company reiterated its objection to the effect that the salesman was not a workman within the definition of the term under the Industrial Disputes Ordinance and that respondent No. 3 could not in law represent the salesmen and vanmen in the Company and had no legal character to represent them as their Collective bargaining Agent and raise these industrial disputes for them. It was also alleged that this matter was already sub , judice in the Labour Courts at Karachi and Peshawar and therefore the Arbitrator acted without lawful authority in pronouncing his award without waiting for the judgment of the competent Courts of law on this issue. The Company also raised a further objection to the effect that the Field Staff Union did not issue any demand notice under section 26 of the Ordinance to the Company nor any conciliation proceedings were held between the parties in accordance with section 27-A. Moreover no strike notice was served by the Union under section 2~- In the circumstances there was no valid reference to arbitration under section 31 of the Ordinance. The Field Staff Union in its counter ;davit dented these allegations and maintained that it was duly constituted as the Collective Bargaining Agent representing the salesmen and vanmen and other workers of the Company in the field.

101. But unfortunately the High Court does not appear to have addressed itself to this main contention raised in the Constitutional Petition against the impugned award in favour of the Field Staff Union. In this Court before us the appellant laid stress to contend that salesmen in the Company were not "workmen" within the definition of the term in section 2(xxvii) of the Industrial Relations Ordinance, 1969 and that as such the Field Staff Union could not in law represent them as their bargaining agent and raise these demands with the Company for and on their behalf.

102. In that connection the appellant-Company heavily relied on the two reported cases In re: Pakistan Tobacco Company Ltd. v. Pakistan Tobacco Company Employees' Union, Dacca and The Chairman, Brooke Bored (Pakistan) Ltd., Karachi v. General Secretary, Union Karkunane Brooke Bond (Pakistan) Lad., Rawalpindi. In the first-mentioned case, the Chief Justice of the Supreme Court in the context of the definition of the term "salesman" in section 2(s) of the Industrial Disputes Act, 1947, observed :- PLD1961SC403

103. "I consider that it admits of no doubt, that persons who are engaged exclusively in the held of distribution through proper agencies of the products of the Company, are nut assimilable either to the group of workers whose manual labour contributes to that product, or those of the clerical establishment who perform the paper work connected with the operations of the Company."

104. Similarly in the other case of the Chairman Brooke Bond (Pakistan) Ltd. I along with my learned brother Muhammad Afzal Cheema, J. as members of the then Division Bench of the High Court, were of the opinion that a salesmen in this Company was not a "workman" within the meaning of the term in section 2(n) of the Industrial Disputes Ordinance, 1959. In that case in conclusion we observed :

105. "In short a salesman in this Company is responsible for the sales and distribution of the tea in his area. No doubt in the process he has to go round mostly on cycle at the cost of the Company but that it not the end in itself. It is merely an incidental part of those main and primary duties. For the manual work involved in carrying the stocks for distribution all over the area he has the services of the vanman under him and he is not there merely to push the van from shop to shop. The clerical work involved in the discharge of his responsibilities in preparing the cash memos., the small column wise daily statement of sales and the weekly returns forms but a small part of his duties and are altogether inconsequential in nature. These do not in any may change the in complexion of the basic work for which the. salesman is employed by the Company."

106. The definition of the term "workman" in the Industrial Disputes Act, 3947 as well as in the Industrial Disputes Ordinance, 1959 was substantially the same. Workman means any person employed, including an apprentice,. in any industry to do any skilled or unskilled manual or clerical work; for hire or reward. It was on the basis of this definition that in the two reported cases discussed above it was held that a salesman was not a workman as from the nature of his duties it appeared that he was not engaged in a manual or clerical work. But this definition was not adopted in the Industrial Relations Ordinance, 1969.

107. According to section 2 (viii) of the Industrial Relations Ordinance "employer" in relation to an establishment, means any person or body of persons, whether incorporated or not, who or which employs workmen in the establishment under a contract of employment and includes r

(a) ,??????????..

(b) any person responsible for the management. supervision and control of the establishment

(c) in relation to any other establishment, the proprietor of such establishment and every director, manager, secretary, agent or other officer or person concerned with the management o" the affair thereof."

108. According to section 2 (xxviii) of this Ordinance "worker" and "workman" mean any person not falling within the definition of employer who is employed (including employment as a supervisor or as an apprentice) in an establishment or industry for hire or reward either directly or through a contractor whether the terms of employment be expressed or implied, and, but does not include .any person : --

109. "(a) who is employed mainly in a managerial or administrative capacity, or

(b) who, being employed in a supervisory capacity, draws wages exceeding eight hundred rupees per mensem or performs, either because of the nature of duties attached to the office or by reason of the powers vested in him, functions mainly of a. managerial nature."

110. The two clauses (a) and (b) reproduced above were added by the Industrial Relations (Amendment) Act, 1973.

111. It is clear that in enacting section 2(xxviii) of this Ordinance the Legislature did not adhere to the old definition of the term "worker" given in the earlier enactments and has in fact altered the entire scheme behind it. The scope of this definition is more comprehensive. It includes all persons employed in an establishment or industry, other than the employer. But it does oat include any person who is employed mainly in a managerial or administrative capacity or who, being employed in a supervisory capacity, draws wages exceeding eight hundred rupees per-mensern or performs, either because of a nature of duties attached to the office or by reason of the powers vested in him, functions mainly of a managerial nature.

112. A salesman in this Company, as his designation implies, is to go round the market in the area for which he is appointed for the distribution and sales of its products. A branch manager is in charge of the administrative control and Management of the affairs of a depot. Primarily tire salesman as such is not concerned with Management. Incidentally, however, in his capacity as a salesman be has to account for daily and weekly sales and submit his returns to the manager in charge of the depot. But all this is an insignificant and a minor part of the duties for which he is appointed se a salesman. In my opinion, therefore, a salesman in this Company is a '"workman" within the definition of the term in section 2 (xxvii) of the Industrial Relations Ordinance, 1969 and respondent No. 3 was lawfully constituted as their Collective Bargaining Agent. Accordingly the objective raised by the Company in this behalf has no force and is repelled.

113. It is evident that the Field Staff Union has also failed to serve any strike notice on the Company and forward its copy to the Conciliator in accordance with law. In fact there was no attempt at all made at conciliation before the Conciliator. In the circumstances, as already discussed above, the parties did not have the capacity and acted illegally in referring this dispute to the arbitration of Mr. Mairaj Muhammad Khan, as the sole arbitrator, without having fully complied with the mandatory requirements of sections 26 to 31 of the Industrial Relations Ordinance, 1969. A fortiorari the reference to his arbitration and the consequent award, were riot made in accordance with law and were without lawful authority. These are, therefore, liable ; be set aside and declared as such on this short ground alone.

114. In passing suffice it to mention here that the High Court, on an examination of the record of the arbitration proceedings, has rightly held that before him the parties had merely depended on their respective written statements and the documents produced before him. They did not choose to produce any witnesses before him. In the circumstances it could not be held that the Arbitrator had failed to afford any reasonable opportunity to the parties to produce their evidence..

115. In conclusion, I am of the opinion that neither the reference to the arbitration or Mr. Mairaj Muhammad Khan, nor his two impugned awards in favour of respondents Nos. 3 and 4, were made in accordance with law, and are without lawful authority. They are liable to be set aside and declared as such.

116. I may mention here that it was strenuously argued before us that according to the financial implications under the two awards, the Company is required to pay about one crore of rupees Vi its workmen as the past arrears, and for the future incur an additional liability of about 35 lacs per annum. It is alleged that this was wholly beyond the means of tike Company. But these allegations were denied before us. On behalf of the two Unions, according to the sworn counter-affidavit of S. Muhammad Iftikher Mohain, dated February, 1974 filed in this Court, the implication of the main demands in the award in favour of the Workers' Union would cost not more than Rs.. 1,91,001 annually and Rs. 80,000 towards the arrears. Similarly the award in favour of the Field Staff union would cast Rs 11,17,520 only for the past arrears and Rs. 2,7:1,?80 annually. By and large I have refrained from expressing any opinion can the merits of the various demands .raised by the two Unions against the Company. It is primarily because in spite of this judgment, the two Union are not debarred from raising their demands afresh against the Company in accordance with the requirements of the law for adjudication under ? the Ordinance and except as otherwise stated above to the contrary, nothing contained herein shall be construed as prejudging their demands on the merits.

117. As a result of this discussion I accept this appeal, reverse the judgment of-the High Court and declare that the impugned reference to arbitration and the two awards of the Arbitrator were ,:jade against the provisions of the Industrial Relations Ordinance, 1969 and are without lawful authority . But there is no order as to costs in the circumstances of the case.

118. MUHAMMAD YAQUB ALI, C. J.-I agree.

119. MUHAMMAD GUL, J.-I agree. s. A. H. ??????????? Appeal allowed.