From: Asif Kasbati <asifskasbati@gmail.com>
Date: Thu, Apr 5, 2018 at 8:05 PM
Subject: QC 453- Federal IRA 2012 is valid for Trans provincial entities/ entities having operations in more than one province - May effect Sindh WPPF & WWF and Provincial Sales Tax Laws
To: <asifskasbati@tax-excellence.com> <asifskasbati@tax-excellence.com>
Cc: Kasbati Co- Main <kasbati.co@gmail.com>
 

Dear Learned Professionals

 

A.   EXECUTIVE SUMMARY
 

The Supreme Court SC has upheld Federal Governments’ Constitutional Right of legislation on Trans provincial matters / entities having operations in more than one province, hence, Federal Industrial Relation Act 2012 (FIRA) held as intra vires the Constitution.

 

2.  This refers to the QC 418 whereby we informed that the SHC decided the Trans province issue about Sindh WPPF allocation is based on number of workers as per SHC order dated 12 February 2018. The matter was also discussed in detail in Sindh & Federal WPPF and Sindh & Federal WWF Workshops to the effect that the issue has not attained finality in case of trans province matter, as the issue is pending in the Supreme Court in Labour law matter and the SHC order may also land to Supreme Court.

 

3. Moreover, effectively in case another Labour Law Issue viz Federal Indirect Relations Act 2012 (FIRA) was challenged in the Supreme Court (SC) as all the four provincial HC had held this as ultra vires the Constitution.

 

4. The SC has now upheld FIRA retrospectively from 1 May 2010 in CA No. 1583 to 1598 of 2014 ,etc  (Click on the link and treat it as Attachment 453.1) in a judgment announced on 28 March 2018, in case of Trans-Province entities / i.e entities having operations in more than one Province, which may affect Sindh WPPF & WWF and may even effect all Provincial Sales Tax Law.

 

 B.  BACKGROUND & DETAILS

 

4. Prior to the 18th Amendment, the Labour and Trade Union Laws enacted by the Federation were binding in the Provinces as well.

 

5. When Parliament enacted IRA 2012, a year after the 18th Amendment was passed, the Act was challenged in the High Courts of Lahore, Sindh, Peshawar and Islamabad, on the grounds that the Parliament did not have the legislative authority to pass laws regarding Labour and Trade unions as the subject had been devolved to the provinces. All four high courts had ruled in favour the IRA 2012, reinforcing the authority of the federation over the provinces.

C.  SUPREME COURT JUDGEMENT EXCERPT
 

6. The operative part of Order is reproduced (in green and Times New Romans) as under for your goodself ready reference.

 “23. ……it is held as under: -

(1) the Federal Legislature has extra-territorial authority but no such extra-territorial authority has been conferred to the Provincial Legislature by the Constitution;

(2) the Federal legislature does, but the Provincial Legislature does not, have legislative competence to legislate to regulate the trade unions functioning at trans-provincial level;

(3) the matters relating to trade unions and labour disputes, etc., having been dealt with and protected under the International Conventions, are covered under Entries No.3 and 32 of Part-I of the FLL. Thus, the Federal Legislature has legislative competence to legislate in this regard; 

(4) under the command of Entry No.13 in Part-II of the FLL, the Federation has competence to enact laws relating to the inter-provincial matters, Entry No.18 thereof further enlarges the scope of the said Entry; therefore, Federal Legislature has legislative competence to legislate in this regard too; 

(5) the IRA 2012 neither defeats the object of the Eighteenth Amendment to the Constitution nor does it destroy or usurp the provincial autonomy;

(6) the IRA 2012 has been validly enacted by the Parliament and is intra vires the Constitution;  

(7) the workers of the establishments/industries functioning in the Islamabad Capital Territory or carrying on business in more than one provinces shall be governed by the Federal legislation i.e. IRO 2012; whereas, the workers of establishments/industries functioning or carrying on business only within the territorial limits of a province shall be governed by the concerned provincial legislations;  

(8) as we have held that the IRA 2012 is valid piece of legislation, it is held that the National Industrial Relations Commission (NIRC) formed under Section 35 of the IRA 2012 has jurisdiction to decide the labour disputes, etc., relating to the employees/workers of companies/corporations/institutions/establishments functioning in more than one Province;

(9) the IRA 2012, being a procedural law, would be applicable retrospectively w.e.f. 01.05.2010, when the IRO 2008 ceased to exist; and

(10) M/s Shaheen Airport Services is not a charitable organization and IRA 2012 is applicable to it as it is operating in more than one Province.”

                                                                                             (Emphasis is ours)

In view of above, the SC has now upheld FIRA retrospectively from 1 May 2010 in CA No. 1583 to 1598 of 2014 ,etc  (Click on the link and treat it as Attachment 453.1) in a judgment announced on 28 March 2018, in case of Trans-Province entities / i.e entities having operations in more than one Province, which may affect Sindh WPPF & WWF and may even effect all Provincial Sales Tax Law.

D. WORKSHOPS on above, etc, we have arranged Sindh & Federal WPPF and Sindh & Federal WWF Workshop   (Click on the link to see flyer and details). Please click on the Link to tentatively Register Now. We also intend to arrange a Workshop on Provincial Sales Tax. Click   Register Now  button to fill the Registration form.

Best regards

Asif