FEDERATION OF PAKISTAN, CHAMBER OF COMMERCE AND INDUSTRY, KARACHI vs ALI AHMED QURESHI

ORDER

' RANA BHAGWAN DAS, J.---Leave to appeal is sought against the judgment dated 29-11-1999 rendered by a learned Division Bench of the Sindh High Court in High Court Appeal No,30 of 1995, whereby appeal preferred by the petitioner was dismissed with slight modification in the decretal amount awarded by the learned Single Judge.

2. Respondent was employed with the petitioner in different capacities and was holding the office of its Joint Secretary when he was abruptly retired from service with effect from 6-1-1986 vide management letter of the even date, stating that Managing Committee in its special meeting held on January 5, 1986 had decided that he shall stand retired with effect from the next day. No reason whatsoever was assigned for premature retirement of the respondent.

3. Accordingly, respondent filed a suit for damages claiming an aggregate amount of Rs,9,82,001.41 in terms of his salary, annual increments, bonus, gratuity, leave encashment, etc. In the written statement, petitioner raised legal pleas of non-maintainability of the suit, unlimited discretionary powers of the Managing Committee to deal with service matters of any employee in the interest of the petitioner federation and lack of cause of action. It was asserted that respondent had received his service dues in full and final settlement of his claim and acknowledged the same in writing.

4. After settlement of issues and recording evidence, learned single Judge decreed the suit with costs in the sum of Rs,10,00,000 and repelled the questions of law agitated by the petitioner.

5. In High Court Appeal, learned Division Bench observed that an amount of Rs,1,52,885.38, was payable to the respondent and after adjustment of loan of Rs,25,500 and the price of car in his possession assessed at Rs,35,000, a sum of Rs,92,385 was paid to him. This amount included Rs,24,097.50 towards notice pay. Learned Division Bench after adjusting this amount concluded that the net amount thus, payable would work out to Rs,9,57,003.50 and accordingly modified the decree.

6. At the hearing, Mr. Akhtar Ali Mehmood, Advocate Supreme Court, learned counsel for the petitioner, referred to clause (5) of Regulation 10 of the "Service Rules of the Employees of the petitioner Federation", which deals with termination of service of an employee.

Clause (5) of the aforesaid Regulation, heavily relied upon by the petitioner, inter alia, envisages:- "5. When services of an employee are terminated for the purpose of retrenchment, notice or pay in lieu of the notice will be given as under:-- (a)

(b)

(c)

(d) In case of an employee who has served for more than 15 years six months' notice or pay in lieu thereof."

7. Learned counsel vehemently contended that in the event of termination of service of an employee of the petitioner, he was not entitled to salary and allowances for a period exceeding six months within the contemplation of the above said regulation. According to learned counsel, respondent was neither entitled to any general or special damages, nor could he lawfully claim his salary and allowances till attaining the age of 58 years, which was prescribed as age of retirement in the petitioner organisation.

8. The argument is completely misconceived as respondent's employment was neither terminated by way of retrenchment, nor was it a termination simpliciter in terms of the contract of employment. It is sad to note that though the respondent served the petitioner organisation for more than 15 years and he had still a period of 12 years at his credit for employment with the petitioner for attaining the age of normal retirement, he has been deprived of his right of employment without any reason or rhym. It is not disputed that the letter of termination candidly states that the Managing Committee of the petitioner had decided to retire him with immediate effect. His case is thus regulated by Regulation 15 of the Regulations and not by Regulation 10 referred to in paragraph 6 of the judgment. This regulation reads as under.-- "15. Retirement.--Notwithstanding anything contained in these rules, the Federation may, at its absolute discretion, retire any employee from its service on the completion of 58 years of age. The President may, however, extend the service period of an employee beyond the age of 58 for a specific period not exceeding one year at one time for reasons to be recorded in writing if in the interest of the Federation such an extension is considered desirable but no employee shall be retained in service beyond the age of 60 years."

9. Learned counsel mainly contended that respondent's services were terminated by way of retrenchment, therefore, in terms of clause (5) of Regulation 10, he was not entitled to more than six months' pay since the very letter of termination plainly spells out that the respondent's employment was brought to an end by, way of retirement and not on account of retrenchment.

The argument, therefore, must be repelled. Assuming for the sake of argument that respondent's employment was terminated by way of retrenchment, still the petitioner was required under the law to assign a good reason for termination of the contract of employment, but none was assigned.Non-placement of the contract of employment on the paper book patently tends to show that had the same been produced, it would have been unfavourable to the petitioner. In all probability, it can be assumed that the contract of employment would be governed by the Regulations framed by the petitioner for its employees, which has the binding force for all intents and purposes. It is well-settled that civil contracts are entered into for strict adherence rather than for gross violation and breach of their terms. The petitioner having flagrantly violated and acted in contravention of its own rules cannot be allowed to abdicate their obligation to perform the covenants of the contract. Learned counsel referred to a judgment of the Sindh High Court in Muhammad Afzal v. House Building Finance Corporation PLD 1976 Karachi 1121, but the principle laid down therein is not attracted in the circumstances of the case and does not improve petitioner's stand point. In view of the doctrine of master and servant relationship, contract of personal service cannot be specifically enforced but in law in the event of arbitrary dismissal or unwarranted termination of employment, an employee is always entitled to sue for damages. In such a case he would be legally entitled to claim his wages, allowances and other benefits, which would have been otherwise due and payable under the contract of employment.

10. Adverting to the question of compensation as modified by the learned Division Bench, suffice it to say that the respondent was entitled to serve the petitioner organisation in his right till 8th January, 1998 and thus, entitled to salary, annual increments, bonus, ex gratia, etc. As admissible under the Regulations of the petitioner and law of the land. Learned Division Bench was conscious of the fact that in the event of respondent being allowed to remain in service was not entitled to notice pay and thus, this amount was rightly adjusted from the decretal amount. Needless to emphasise that in the event of normal employment with the petitioner, respondent was legally entitled to bonus and all other allowances paid to other employees of the petitioner and as no evidence in rebuttal was adduced by the petitioner, therefore, it is not entitled to make grievance of the circumstance that the respondent was not entitled to such allowances.

11. No other point was urged in support of the petition which is devoid of any merit and substance. It is accordingly dismissed and leave to appeal refused.