IN THE SUPREME COURT OF PAKISTAN 
 
 
(Appellate Jurisdiction) 
 
 
Present: 
Mr. Justice Nasir-ul-Mulk, CJ 
Mr. Justice Gulzar Ahmed 
Mr. Justice Mushir Alam 
 
 
CIVIL PETITIONS No.565-568 & 582-584 OF 2014 
[On appeal against common Judgement dated 17.03.2014, passed by  
the Islamabad High Court, Islamabad, in ICA No.8 of 2012] 
 
CIVIL PETITIONS No.1596-1597, 1602, 1643 & 2064-2067 OF 2014 
[On appeal against common Judgement dated 03.07.2014 passed by 
the Peshawar High Court, Peshawar, in W.P.No.2657 of 2012] 
 
CRIMINAL PETITION No.214 OF 2014 
[On appeal against common Judgment dated 17.03.2014, passed by  
the Islamabad High Court, Islamabad, in ICA No.8 of 2012] 
AND 
CMA No.3540 OF 2014 in C.P.No.565 OF 2014 
[For impleadment of Telecom Pensioners Association as Respondent] 
 
 
 
Pakistan Telecommunication Employees Trust 
(PTET) through its M.D., Islamabad. 
 
(in CPs.565-568, 2064-2067,  
Crl.P.214 & CMA.3540) 
Pakistan Telecommunication Company Limited. 
 
(in CPs.582-584,1602) 
The President, PTCL, & another. 
(in CPs.1596-1597 & 1643) 
Petitioner(s) 
 
VERSUS 
 
Muhammad Arif & others. 
 
 
(in CP.565) 
Fazil Malik & others. 
 
 
(in CPs.566,582) 
Fida Hussain & others.  
 
 
(in CPs.567, 584) 
Muhammad Anwar Shahid & others. 
(in CP.568, 583) 
Muhammad Arif & others. 
 
 
(in Crl.P.214 & CMA.3540) 
Mst. Bakhat Pari & others. 
 
 
(in CPs.1596, 2066) 
Muhammad Yousaf Afridi & others.  
(in CPs.1597, 1602, 2064) 
Sadiq Ali & others. 
 
 
 
 
(in CPs.1643, 2065) 
Muhammad Rafique & others.  
(in CP.2067) 
Respondent(s) 
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C.Ps 565-568, 582-584, 1596-1597, 1602, 1643, 2064-2067 of 2014, Crl.P.No.214 of 2014 & CMA No.3540 of 2014 
 
 
 
For the Petitioner(s) 
  
[in CP.565 & 566] 
 
: Mr. Khalid Javed Khan, ASC 
[in CP.567] 
 
: Mr. Zia-ul-Haq Makhdoom, ASC 
[in CP.568] 
: Mr. Rizwan Ijaz, ASC 
Mr. Zia-ul-Haq Makhdoom, ASC 
 
[in CP.582-584, 1596-1597, 
1602, 1643] 
: Mr. Shahid Anwar Bajwa, ASC 
Ms. Zahida Awan, EVP (Legal) PTCL 
 
[in Crl.P.214, CP.2064-2067] 
: Mr. Zulfiqar Khalid Maluka, ASC 
 
  
For the Applicant(s) 
  
[in CMA.3540] 
: Mr. Hashmat Ali Habib, ASC 
 
  
For the Respondent(s) 
  
[R.1-34 in CP.565] 
[R.1-134 in CP.566] 
[R.1-34 in CP.582] 
 
: Mr. Khalil-ur-Rehman, ASC 
[R.1-4,6-9,11-18,20-51 in 
CPs.567, 584] 
 
: Mr. Ghulam Mahboob Khokhar, ASC 
[R.1 in CP.568] 
 
: Mr. Abdul Rahim Bhatti, ASC 
[R.2 in CP.568] 
[R.1-2 in CP.583] 
 
: Ch. Mushtaq Hussain, ASC 
[R.1-60 in CP.1596] 
[R.1 in CP.1597] 
[R.1 in CP.1602] 
[R.1-805 in CP.1643] 
[R.1 in CP.2064] 
[R.1-624 in CP.2065] 
[R.1-60 in CP.2066] 
[R.1-135 in CP.2067] 
: Mr. Salah-ud-Din Khan, ASC 
 
  
Dates of Hearing 
: 10.11.2014, 27.11.2014, 28.11.2014, 
01.12.2014 & 02.12.2014 
 
 
JUDGMENT 
 
GULZAR AHMED, J.—  These petitions have arisen from two sets of 
proceedings initiated by the respondents against the petitioners (1) at 
the Islamabad High Court, Islamabad and; (2) at Peshawar High 
Court, Peshawar.  The impugned judgment of the Islamabad High 
Court, Islamabad is dated 17.03.2014 while impugned judgment of 
Peshawar High Court, Peshawar is dated 03.07.2014.  Initially one set 
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C.Ps 565-568, 582-584, 1596-1597, 1602, 1643, 2064-2067 of 2014, Crl.P.No.214 of 2014 & CMA No.3540 of 2014 
 
 
 
of Writ Petitions were filed in the Islamabad High Court, Islamabad, 
which were allowed by a learned Single Judge vide common judgment 
dated 21.12.2011 against which the petitioners filed Intra Court 
Appeals, which have been dismissed by the impugned judgment.  The 
Writ Petitions in the Peshawar High Court, Peshawar, were decided by 
its Division Bench, by the impugned judgment. 
2. 
 
Admittedly, the respondents were the serving employees, 
retired employees and widows of retired employees, who were 
employed in the Pakistan Telegraph & Telephone Department (T&T 
Department) and through various enactments were transferred to 
Pakistan Telecommunication Corporation (the Corporation) and then 
to the Pakistan Telecommunication Company Limited (the Company).  
The enactments under which their services were transferred are dealt 
with in this judgment herein below.  In nutshell the grievance of the 
respondents who have filed Writ Petitions in the High Courts was that 
the pension was being paid to the erstwhile employees of T&T 
Department transferred to the Corporation and then to the Company 
which was with increase announced by the Government of Pakistan but 
this increase in pension was abruptly stopped by the petitioners.  The 
respondents have prayed that the pension be paid in accordance with 
the increase announced by the Government of Pakistan vide its 
notification dated 05.07.2010. 
3. 
 
We have heard the learned ASCs for the parties and have 
gone through the record. 
4. 
 
Mr. Khalid Javed Khan, learned ASC appearing for the 
petitioner-Pakistan 
Telecommunication 
Employees 
Trust, 
after 
extensively going through various enactments and rules etc., has 
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C.Ps 565-568, 582-584, 1596-1597, 1602, 1643, 2064-2067 of 2014, Crl.P.No.214 of 2014 & CMA No.3540 of 2014 
 
 
 
contended that there is no provision in the Civil Servants Act, 1973 for 
increase of pension and that whatever increase in pension is granted 
by the Federal Government is on the basis of its own policy.  He also 
contended that the provision of Civil Servants Act being not applicable 
to employees of the Company consequently any increase in pension 
granted by the government to the civil servants will not extend to the 
employees of the Company.  He further contended that though 
pension is granted as a part of terms and conditions of service but its 
increase is not the part of terms and conditions as the increase in 
pension is basically a matter of policy which has to be decided by the 
Trustees of the Trust.  He contended that though the Trust is a 
statutory Trust but there being no provision in the statute providing for 
increase in pension, the increase in pension being a matter of policy is 
granted through an executive order.  He admitted that before 2010, 
the pension to the employees of the Company was being increased as 
per the one announced by the Government of Pakistan but in 2010 the 
increase granted by the Government was not followed rather the 
increase in pension was granted as announced by the Trustees of the 
Trust.  He contended that if the employees are paid pension, as 
increased by the Government of Pakistan, the provision of Section 44 
of the Act of 1996 will become redundant.  He further contended that 
the liability of the Trust to pay pension and its increase to the 
employees is restricted only to those, who were in employment in 
1996, and those who came into employment after 1996 are not 
governed by the Trust and are merely contract employees and their 
contribution is paid to the Employees Oldage Benefit Institution 
(EOBI).  He also contended that the petitioner has paid benefit of 
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C.Ps 565-568, 582-584, 1596-1597, 1602, 1643, 2064-2067 of 2014, Crl.P.No.214 of 2014 & CMA No.3540 of 2014 
 
 
 
Voluntary Separation Scheme (VSS) to the employees and those who 
have received the benefit of VSS cannot maintain the petition as their 
dues including pensionary dues have been fully paid by the petitioner.   
5. 
 
Mr. Zia-ul-Haq Makhdoom, learned ASC for the petitioner 
in C.P.No.567 of 2014; Mr. Rizwan Ijaz, learned ASC for the petitioner 
in C.P.No.568 of 2014; and Mr. Zulfiqar Khalid Maluka, learned ASC for 
the petitioner in Crl.P.No.214 of 2014 & C.P.Nos.2064-2067 of 2014 
have adopted the arguments advanced by Mr. Khalid Javed Khan.   
6. 
 
Mr. Shahid Anwar Bajwa, learned ASC for the petitioners in 
C.P.Nos.582-584, 1596-1597, 1602 & 1643 has contended that after 
1996 on PTCL becoming a private Company, all the terms and 
conditions of service of respondents came to be fixed by the Company 
with the condition that it should not be less favourable to which they 
were entitled.  He further contended that in considering the increase in 
pension actuary report is required to be taken into consideration and 
the actuary report is made on the basis of inflation, financial 
constraints of the Company to fund the unfunded portion of the 
increase.  He contended that those employees who have opted for VSS 
in 2007, 2008 & 2009 are being paid pension @ 7% every month 
according to the terms of VSS and such being the bargain made by the 
VSS optees, they are not entitled to grant of any other pensionary 
benefit.  He contended that Section 45 (2) of the Act of 1996 provides 
for contribution by the Company to the Pension Fund the amount 
determined by Actuary representing the unfunded proportion of the 
accrued pension liabilities from the effective date.  He further 
contended that in terms of SRO NO.115(I)/96 dated 11.02.1996 the 
Company has discharged its obligation by making payment to the 
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C.Ps 565-568, 582-584, 1596-1597, 1602, 1643, 2064-2067 of 2014, Crl.P.No.214 of 2014 & CMA No.3540 of 2014 
 
 
 
Trust according to the amount specified in Schedule-III of the said 
SRO and such became past and closed transaction.  He contended that 
there are two types of regulations; one are statutory and the other are 
non-statutory and that the PTET Rules are statutory rules and are 
designed to govern the transferred employees.  He further contended 
that the case of Masood Ahmed Bhatti is being reconsidered by this 
Court.   
7. 
 
Mr. Khalil-ur-Rehman, learned ASC for private respondents 
in C.P.Nos.565, 566 and 582 of 2014 has read the provisions of six 
Ordinances commencing from Ordinance LI of 1994.  The learned ASC 
has contended that through Trust Deed dated 02.04.1994 Pakistan 
Telecommunication Corporation Employees Pension Fund was created 
and all departmental employees transferred to the Corporation were 
entitled to be paid pension as defined under the Federal Government 
Pension Rules.  He contended that after promulgation of the Act of 
1996, Pakistan Telecommunication Employees Trust was created which 
took over the liability of the Pension Fund created by the Trust Deed of 
02.04.1994 to that there was a continuity of Pension Fund from the 
one created by Trust Deed dated 02.04.1994 to that of the Pakistan 
Telecommunication Employees Trust.  He referred to the definition of 
the term ‘telecommunication employees’ as given in the Act of 1996 
and contended that all employees of former T&T Department are 
entitled to receive pensionary benefits as per the one fixed by the 
Federal Government.  He contended that through vesting order dated 
07.02.1996 issued by the Ministry of Communication, Government of 
Pakistan, the effective date of vesting of all properties, rights and 
liabilities of the Corporation to that of Pakistan Telecommunication 
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C.Ps 565-568, 582-584, 1596-1597, 1602, 1643, 2064-2067 of 2014, Crl.P.No.214 of 2014 & CMA No.3540 of 2014 
 
 
 
Company Limited was announced to be that of 01.01.1996.  Similarly, 
all employees of the Corporation become employees of the Company 
also from 01.01.1996 with liability in respect of payment of pension, 
therefore, the entitlement for payment of pension at the rate fixed by 
the Federal Government was accepted by the Company.  He referred 
to the provision of subsection (2) of Section 59 of the Act of 1996 and 
contended that all orders passed prior to the promulgation of this Act 
were saved including the Employees Pension Fund Rules, 1994 and 
that the Company has assumed the liability and such pension is also 
protected.   
8. 
 
Ch. Mushtaq Hussain, learned ASC for the respondents in 
C.P.Nos.568 & 583 of 2014 has made distinction of 4 kinds of 
employees that of T&T Department, Corporation Employees, Contract 
Employees and Company Employees and contended that the 
respondents are employees of T&T Department and being transferred 
employees their benefits cannot be reduced from the one they were 
enjoying as such departmental employees which is inclusive of 
pension.  He further contended that the Transferred Employees are 
being paid salary and other dues that of a government employees and 
posed a question as to why the pension as fixed by the Federal 
Government should not be paid to the respondents. 
9. 
 
Mr. Salah-ud-Din Khan, learned ASC for the respondents in 
C.P.Nos.1596, 1597, 1602, 1643, 2064, 2065, 2066 and 2067 of 2014 
has referred to the letter dated 05.04.2013 of the Ministry of 
Information Technology wherein four questions were referred to the 
Ministry of Law with regard to payment of dues and the opinion of 
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C.Ps 565-568, 582-584, 1596-1597, 1602, 1643, 2064-2067 of 2014, Crl.P.No.214 of 2014 & CMA No.3540 of 2014 
 
 
 
Ministry of Law dated 11.03.2013 where in dealing with the question of 
increase in pension it is opined as follows:- 
 
“Whether increase in pension of Federal Government is also allowed to 
transferred employees of the PTCL the issue is answered in the 
affirmative because their terms and conditions have been guaranteed 
by the Federal Government”. 
 
10. 
 
Mr. Abdul Rahim Bhatti, learned ASC for the respondents 
in C.P.Nos.568 & 583 of 2014 has contended that the employees of 
T&T Department were transferred to the Corporation and then to the 
Company by operation of law with specific provision that their terms 
and conditions will not be varied to their disadvantage.  He contended 
that the Company has been following the government rules in 
payment of pension upto 2010 and that such was a guaranteed right 
of the respondents which cannot be denied.  He also referred to the 
share-purchase agreement and the notifications providing for increase 
in pension and contended that the increase in pension, as per 
government rules, having been paid for almost 13 years became 
practice and such practice cannot be discontinued as it becomes law.  
He further contended that the Transferred Employees are civil servants 
and their terms and conditions of service are governed by the Civil 
Servants Act.  In support of his submissions, learned ASC has relied 
upon the case of Pakistan Telecommunication Corporation & another 
V. Riaz Ahmed & 6 others [PLD 1996 SC 222]; Divisional Engineer 
Phones, Phones Division, Sukkur & another V. Muhammad Shahid & 
others [1999 SCMR 1526]; and order dated 23.08.2013 passed by this 
Court in Civil Petition Nos.717 & 718 of 2013.   
11. 
 
Mr. Hashmat Ali Habib, learned ASC for the applicants in 
CMA No.3540 of 2014 and Mr. Ghulam Mahboob Khokhar, learned ASC 
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C.Ps 565-568, 582-584, 1596-1597, 1602, 1643, 2064-2067 of 2014, Crl.P.No.214 of 2014 & CMA No.3540 of 2014 
 
 
 
for the respondents in C.P.Nos.567 & 584 of 2014 have adopted the 
arguments of the respondents' counsel referred to above. 
12. 
 
The functions of telecommunication in Pakistan were being 
undertaken by the T&T Department of the Federal Government of 
Pakistan.  By the Pakistan Telecommunication Act, 1991 (the Act of 
1991), Pakistan Telecommunication Corporation was established with 
the purpose and function to establish, maintain and operate 
telecommunication with transfer of assets and liabilities and all 
employees of T&T Department to the Corporation.  Section 9 of the Act 
of 1991 provided that the employees of T&T Department transferred to 
the Corporation shall have the same terms and conditions to which 
they were entitled immediately before such transfer and that the terms 
and conditions of service shall not be varied by the Corporation to their 
disadvantage.  Subsequently, the Pakistan Telecommunication (Re-
Organization) Act, 1996 (the Act of 1996) was promulgated for the 
re-organization of Pakistan Telecommunication system in Pakistan by 
establishing 
Pakistan 
Telecommunication 
Authority, 
Frequency 
Allocation 
Board, 
National 
Telecommunication 
Corporation 
and 
Pakistan 
Telecommunication 
Employees 
Trust 
and 
transfer 
of 
telecommunication service to private sector etc.  Under Section 34 of 
the Act of 1996, the Federal Government established a Company 
known as Pakistan Telecommunication Company Limited incorporated 
under the Companies Act, 1984, with the principal object of provision 
of domestic and international telecommunication.  Section 35 of the 
Act of 1996 empowered the Federal Government to issue Vesting 
Order vesting certain rights and liabilities of the Corporation to the 
Company from the effective date.  The Vesting Order was also to 
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C.Ps 565-568, 582-584, 1596-1597, 1602, 1643, 2064-2067 of 2014, Crl.P.No.214 of 2014 & CMA No.3540 of 2014 
 
 
 
specify the employees of the Corporation to be transferred and 
become the employees of the Company from the effective date.  Sub 
Section (1) of Section 36 of the Act disentitled the Transferred 
Employees to any compensation as a consequence of transfer to the 
Company.  The proviso, however, lays down that the Federal 
Government shall guarantee the existing terms and conditions of 
service and rights, including pensionary benefits of the Transferred 
Employees.  Sub Section (2) of Section 36 provided that the terms and 
conditions of service of the Transferred Employees shall not be altered 
adversely by the Company except in accordance with the laws of 
Pakistan or with the consent of the Transferred Employees and the 
award of appropriate compensation.  Sub Section (5) of Section 36 
provided that in the order vesting property of the Corporation to the 
Company, the Federal Government shall require the Company to 
assume responsibility of pensionary benefits of the telecommunication 
employees and the Company shall not alter such pensionary benefits 
without the consent of the individuals concerned and the award of 
appropriate compensation.  In terms of Section 35 of the Act of 1996, 
the Government of Pakistan issued Vesting Order dated 07.02.1996, 
by which all properties and liabilities of the Corporation were vested in 
the Company w.e.f. 01.01.1996 and all employees of the Corporation 
except those transferred to Pakistan Telecommunication Authority, 
Frequency Allocation Board, National Telecommunication Corporation 
and Pakistan Telecommunication Employees Trust stood transferred to 
and become the employees of the Company w.e.f. 01.01.1996.  It 
further provided that w.e.f. 01.01.1996 the liability of Corporation in 
respect of payment of pension to telecommunication employees shall 
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C.Ps 565-568, 582-584, 1596-1597, 1602, 1643, 2064-2067 of 2014, Crl.P.No.214 of 2014 & CMA No.3540 of 2014 
 
 
 
be transferred to the Pakistan Telecommunication Employees Trust 
and the Company shall be liable for and assume the responsibility to 
contribute to the Pakistan Telecommunication Employees Trust the 
amount determined in accordance with Section 45.  The order further 
provided that the Corporation without being wound up stands 
dissolved and ceased to exist w.e.f.01.01.1996. 
13. 
 
From the reading of the Act of 1991 and thereafter of the 
Act of 1996, it is abundantly clear that the employees of T&T 
Department were transferred to the Corporation with the terms and 
conditions of their service similar to the one they were enjoying before 
such transfer.  It is not in dispute before us that the employees of T&T 
Department, whose case is before us, were transferred to the 
Corporation and they enjoyed the same terms and conditions of 
service as were applicable to them as employees of T&T Department.  
Under the terms and conditions of service, such employees were also 
entitled to payment of pension on their retirement.  On 2nd April, 1994, 
the Corporation executed a Trust Deed establishing Pakistan 
Telecommunication Corporation Employees Pension Fund.  Para 2 of 
which reads as follows:- 
 
 
“All departmental employees transferred to the Corporation as defined 
in section 9 of the Pakistan Telecommunication Corporation Act, 1991 
shall be entitled to benefits as defined under the Federal Government 
Pension Rules as applicable to such employees before the formation of 
PTC.” 
 
By section 44 of the Act of 1996, the Federal Government has 
established a trust called Pakistan Telecommunication Employees Trust 
(the Trust).  Section 45 of the Act of 1996 made provision for issuing 
of Vesting Order by the Federal Government of vesting of all assets 
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C.Ps 565-568, 582-584, 1596-1597, 1602, 1643, 2064-2067 of 2014, Crl.P.No.214 of 2014 & CMA No.3540 of 2014 
 
 
 
and such liabilities as are specified in the Trust from the effective date.  
Section 46 of the Act of 1996 lays down functions and powers of the 
Trust which, inter alia, provides for making of provision for the 
payment of pensions to telecommunication employees to the extent of 
their entitlement with exclusive right to determine the amounts, if any, 
payable in respect of pension benefits to the telecommunication 
employees.  It has already been mentioned above that by the Vesting 
Order dated 07.02.1996, inter alia, the liability of payment of pension 
of telecommunication employees was transferred to the Trust and the 
Company was liable and has assumed the responsibility to contribute 
to the Trust, the amounts determined in accordance with Section 45. 
14. 
 
The question that needs to be addressed is about the 
status in obtaining of pension by the employees of the erstwhile T&T 
Department, who were transferred to the Corporation from where they 
were transferred to the Company.  It is clear from the reading of 
provision of the Act of 1991 so also that of the Act of 1996 that the 
terms and conditions of service of the Transferred Employees from T&T 
Department to the Corporation and then to the Company remain 
unaltered and they continued to be paid the benefits as were 
admissible to them as employees of T&T Department.  There seems to 
be no dispute until 2009 regarding the entitlement of pension to the 
employees of erstwhile T&T Department inasmuch as they have been 
paid pension at the same rate of increase as has been provided by the 
Federal Government to its employees as is apparent from the record of 
pension payment submitted by the counsel for the Trust by way of 
CMA No.6331 of 2014, which shows the payment of pension as 
follows:- 
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C.Ps 565-568, 582-584, 1596-1597, 1602, 1643, 2064-2067 of 2014, Crl.P.No.214 of 2014 & CMA No.3540 of 2014 
 
 
 
CMA No.6331 of 2014 
Pension increased by the Pakistan Telecommunication Company 
Employees Trust 
 
Year(s) 
Category 
Percentage 
2004-05 
(i) 
Retired before 01.01.96 
16% As per GOP 
(ii) 
Retired after 01.01.96 
8% 
2005-06 
(i) 
Retired before 01.01.96 
10% as per GOP 
(ii) 
Retired after 01.01.96 
10% 
2006-07 
(i) 
Retired before 01.01.96 
20% As per GOP 
(ii) 
Retired after 01.01.96 
20% 
2007-08 
(i) 
Retired before 01.01.96 
Per GOP 
 
(ii) 
Retired after 01.01.96 
2008-09 
(i) 
Retired before 01.01.96 
20% As per GOP 
(ii) 
Retired after 01.01.96 
20% 
2009-10 
(i) 
Retired before 01.01.96 
15% As per GOP 
(ii) 
Retired after 01.01.96 
15% 
 
15. 
 
The above chart of payment of pension by the Trust shows 
that there were in all two categories of employees to whom the 
pension was being paid by the Trust; (1) who retired before 
01.01.1996 and (2) who retired after 01.01.1996.  The chart also 
makes it clear that those who had retired before 01.01.1996 are being 
paid pension as per the increase announced by the Government of 
Pakistan while those who had retired after 01.01.1996 being paid 
pension according to the rate fixed by the Trust.  The payment of 
pension by the Trust until 2009 appears to be consistent with the rate 
and entitlement of the employees of erstwhile T&T Department as has 
been amplified from the provisions of the Act of 1991 and the Act of 
1996 read with Para 2 of the Trust Deed of 2nd April, 1994, which term 
was not varied or altered in creation of the Trust rather the same was 
kept intact.   
16. 
 
While examining the question in issue we also examined 
some precedents of this Court in respect to the employees of PTCL, 
who were initially in employment of T&T Department from where they 
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C.Ps 565-568, 582-584, 1596-1597, 1602, 1643, 2064-2067 of 2014, Crl.P.No.214 of 2014 & CMA No.3540 of 2014 
 
 
 
were transferred to the Corporation and then to the Company.  In the 
case of Divisional Engineer Phones, Phones Division , Sukkur & another 
V. Muhammad Shahid & others [1999 SCMR 1526], the respondents 
were appointed Telephone Operators and it was held that “in cases of 
Corporation created by the Government through statutory instruments 
if existing employees are transferred to the Corporation in the absence 
of any provision to the contrary, the Transferred Employees continue 
to remain in the service of Corporation on the same terms and 
conditions under which they were working before their transfer to the 
Corporation.  Therefore, if an employee of the Corporation before his 
transfer to the Corporation was a civil servant, he continues to be a 
civil servant.  In all other cases, where an employee is appointed in 
the service of the Corporation after the Corporation is established, his 
service is governed by Service Rules of the Corporation.  If such Rules 
are not statutory, the principal of master and servant governed the 
relationship between the employee and the Corporation”.  In the case 
of Pakistan Telecommunication Corporation & another V. Riaz Ahmad 
& 6 others [PLD 1996 SC 222], it was held that the employees of T&T 
Department transferred to the Corporation were civil servants.  In the 
case of Ejaz Ali Bughti V. PTCL & others [2011 SCMR 333], this Court 
has held that as there were no statutory rules of service applicable to 
the employees of the Company and in view of the judgment in the 
case of Muhammad Mubeen-us-Salam V. Federation of Pakistan [PLD 
2006 SC 602], the petitioner was not civil servant and his appeal 
before the Service Tribunal was not maintainable.  In the case of 
Pakistan Telecommunication Corporation Limited V. Iqbal Nasir & 
others [PLD 2011 SC 132], though it was held that the Company is a 
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C.Ps 565-568, 582-584, 1596-1597, 1602, 1643, 2064-2067 of 2014, Crl.P.No.214 of 2014 & CMA No.3540 of 2014 
 
 
 
person within the meaning of Article 199 (5) of the Constitution and 
will be amenable to the writ jurisdiction of the High Court but there 
being no statutory rules of service applicable to its employees, the writ 
petition in the High Court was found to be not maintainable.   
17. 
 
Mr. Shahid Anwar Bajwa, learned ASC for the Company 
has contended that the case of Masood Ahmed Bhatti & others V. 
Federation of Pakistan through Secretary, M/O Information Technology 
& Telecommunication & others [2012 SCMR 152] may not be relied 
upon by this Court for the reason that such judgment is being 
reconsidered by this Court.  What we understand from this submission 
of the learned ASC is that a review petition for the review of a reported 
judgment may be pending in this Court.  We may note that until the 
judgment of this Court is reviewed and some other conclusion is 
reached other than the one which has already been pronounced by this 
Court, the same remains in field and operates as a law pronounced by 
this Court.  Therefore, we cannot ignore this case inasmuch as it is a 
judgment of three members bench of this Court and as per the law of 
precedent, the same is binding on us.  In this case, the appellants 
were admittedly civil servants and they were transferred from T&T 
Department to the Corporation and then to the Company.  The 
grievances of the appellants were with regard to promotion, for 
payment of pensionary benefits and of VSS.  The High Court of Sindh 
has dismissed the constitutional petition filed by the appellants on the 
ground of non-availability of statutory rules of service applicable to the 
employees of the Company.  This Court, after evaluating various 
provisions of the Acts of 1991 and 1996 and the Vesting Order dated 
07.02.1996 has made following observations :- 
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C.Ps 565-568, 582-584, 1596-1597, 1602, 1643, 2064-2067 of 2014, Crl.P.No.214 of 2014 & CMA No.3540 of 2014 
 
 
 
“14. 
We may now consider the effect of this transfer of the 
appellants to PTCL along with the assets and liabilities of the 
Corporation and the implications of such transfer on the nature of the 
rules of employment applicable to the appellants from the date (i.e. 
1.1.1996) they became employees of PTCL. The provision to section 
35(2) of the Reorganization Act provides a clear answer to this 
controversy. It specifies that even after the transfer of the appellants 
to PTCL their terms and conditions of service which existed on 
1.1.1996, would be the base and bare minimum in matters of their 
employment with PTCL. These terms and conditions were imposed on 
PTCL by the Reorganization Act, as a legal obligation and the Vesting 
Order was issued by the Federal Government “in exercise of powers 
conferred by section 35” of the Reorganization Act. The Federal 
Government, it will be noted, had been granted limited powers only; 
the constraint on it was that the terms and conditions of service of 
employees of the Corporation could not be varied to their 
disadvantage. PTCL, as the recipient of the properties and rights of the 
Corporation, also assumed the liabilities of the Corporation. Such 
liabilities necessarily included the liabilities owed to the employees, 
arising from the terms and conditions of their service as these could 
not be varied to their disadvantage.  
 
15. 
Thus it is evident that at the moment of transition when the 
appellants ceased to remain the employees of the Corporation and 
became the employees of PTCL, they admittedly were governed by 
rules and regulations which had been protected by the PTC Act. The 
said rules, therefore, by definition were statutory rules as has been 
discussed above. PTCL, no doubt, could made beneficial rules in 
relation to its employees which were in addition to the rules of 
employment prevailing on 1.1.1996. However, by virtue of the 
aforesaid proviso, PTCL had no power to “vary the terms and 
conditions of service” of its employees who were previously employees 
of the Corporation. “to their disadvantage”. Even the Federal 
Government was debarred by virtue of section 35 ibid from varying 
such terms and conditions of service to the disadvantage of the 
appellants.  
 
16. 
An easy and uncomplicated test becomes available to us to help 
determine the status of the employment rules governing the 
appellants. If the current employer of the appellant viz. PTCL is 
constrained by legislation such as section 35(2) of the Reorganization 
Act, and as a consequence, cannot vary the existing rules to the 
disadvantage of the appellants, because of such legislation, it must 
follow that such law has the effect of saving the rules which existed 
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C.Ps 565-568, 582-584, 1596-1597, 1602, 1643, 2064-2067 of 2014, Crl.P.No.214 of 2014 & CMA No.3540 of 2014 
 
 
 
when the appellants became employees of PTCL. Such existing rules, 
having been protected by section 35(2), therefore, can only be 
categorized as statutory rules.  
 
17. 
Section 36 of the Reorganization Act also has relevance in 
determining the controversy which arises in these appeals. Subsection 
(2) of section 36 gives protection to the terms and conditions of 
service of employees such as the appellants who stood transferred 
from the Corporation to PTCL on 1.1.1996. Their terms and conditions 
of service cannot be altered adversely by PTCL “except in accordance 
with the laws of Pakistan or with the consent of the transferred 
employees and the award of appropriate compensation”. When this 
legal provision is read together with section 35, it becomes abundantly 
clear that by operation of the Reorganization Act, the terms and 
conditions of service of the appellants as on 1.1.1996 stood conferred 
on them as vested rights under the said law”. 
 
18. 
 
Thus, in the above case this Court has held that the terms 
and conditions of service so also the rules of service which were 
applicable to the T&T Department employees while in employment of 
the Government of Pakistan will continue to be applicable to them on 
their transfer to the Corporation and then to the Company.  The 
proposition advanced by Mr. Khalid Javed Khan, learned ASC, that an 
order granting increase in pension is an executive function based on a 
policy taking into consideration various factors of inflation and financial 
conditions, on its face, appears to be correct as the same is based 
upon the pronouncement of this Court in the case of Akram Ul Haq Alvi 
V. Joint Secretary (R-II) Government of Pakistan, Finance Division, 
Islamabad & others [2012 SCMR 106].  However, the question before 
us is not about the tenor and status of the government order or the 
order which is passed by the petitioner for increasing the pension on 
the very entitlement of the respondents to the benefit of increase in 
pension awarded by the Government.  The entitlement of the 
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C.Ps 565-568, 582-584, 1596-1597, 1602, 1643, 2064-2067 of 2014, Crl.P.No.214 of 2014 & CMA No.3540 of 2014 
 
 
 
respondents to the increase in pension, as the one announced by the 
Government of Pakistan, is to be determined on the basis of the law 
applicable to their employment.  In Masood Ahmed Bhatti’s case 
(supra), this Court has held that not only the terms and conditions of 
service of the employees of T&T Department who were transferred to 
the Corporation and then to the Company will be the same but also the 
rules of service as were applicable to them as employees of T&T 
Department.  Thus, it becomes clear that the employees of T&T 
Department who were transferred to the Corporation and then to the 
Company having retired, they will as per the terms and conditions of 
service will be entitled to payment of pension also according to the one 
announced by the Government of Pakistan.  Thus if any increase in 
pension is announced by the Government of Pakistan for its 
employees, the same will also apply and will be paid to the employees 
of T&T Department transferred to the Corporation and then to the 
Company.  This view of ours is further fortified by the provision of 
Section 46 (1) (d) of the Act of 1996 where it is stated that the Board 
of Trustees of the Trust shall make provision for payment of pension to 
telecommunication employees to the extent of their entitlement.    The 
very term “to the extent of their entitlement” shows that there are 
different kinds of employees having different entitlement and 
provisions for them have to be made accordingly.  This is also 
apparent from the chart shown above where there already existed two 
kinds of employees, one who have retired before 01.01.1996 and the 
other who have retired after 01.01.1996 to whom different rate of 
increase in pension is paid.  It is, therefore, not correct to state that 
there will be redundancy of Section 44 of the Act of 1996 if the 
- 19 – 
 
C.Ps 565-568, 582-584, 1596-1597, 1602, 1643, 2064-2067 of 2014, Crl.P.No.214 of 2014 & CMA No.3540 of 2014 
 
 
 
Trustees are allowed to make provision for the pension according to 
their own working.  In view of this clear provision in Section 46 of the 
Act of 1996, we do not find that this Section has any direct nexus with 
Section 44 of the Act of 1996 nor the redundancy to Section 44 can be 
attributed.  We are here only dealing with cases of those employees, 
who were employed in T&T Department and transferred to the 
Corporation and then to the Company and not any other employees.  
Similarly, we also note that there is no mention in either of the two 
impugned judgments regarding the question of VSS.  We, therefore, 
do not consider it appropriate to decide this question at this stage.   
19. 
 
Adverting to the submission of Mr. Shahid Anwar Bajwa, 
learned ASC, we may note that while the Company may be entitled to 
fix the terms and conditions of service of its employees so also the 
provision of pension by the Board of Trustees of the Trust but as 
discussed above, as regards the employees of T&T Department 
transferred to the Corporation and then to the Company, their terms 
and conditions of service stand protected by the provision of Section 9 
of the Act of 1991 and Sections 35, 36 and 46 of the Act of 1996 and 
thus they will be entitled to payment of increase in pension as is 
announced by the Government of Pakistan.  The contribution of the 
Company to the Pension Fund determined by the Actuary and its 
payment by the Company does not appear to be of much relevance 
because the question before us is of entitlement of the respondents to 
the increase in pension. In the case of Secretary, Government of the 
Punjab, Finance Department & 269 others V. M. Ismail Tayer & 269 
others [2014 SCMR 1336], this Court has held that while on 
completion to commutation period the civil servant is entitled to 
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C.Ps 565-568, 582-584, 1596-1597, 1602, 1643, 2064-2067 of 2014, Crl.P.No.214 of 2014 & CMA No.3540 of 2014 
 
 
 
payment of full pension.  It was noted, and such has been done time 
and again by this Court that pension is a part of a civil servant’s 
retirement benefit and is not bounty or an ex-gratia payment but a 
right acquired in consideration of his past service which was a vested 
right with legitimate expectation.  The right to pension is conferred by 
law which could not be arbitrarily abridged or reduced except in 
accordance with law.  The aspect of the statutory rules has already 
been dealt with above and we tend to agree with the rule laid down in 
the case of Masood Ahmed Bhatti (supra). 
20. 
 
For the foregoing reasons, we have come to conclusion 
that the respondents, who were the employees of T&T Department 
having retired after their transfer to the Corporation and the Company, 
will be entitled to the same pension as is announced by the 
Government of Pakistan and that the Board of Trustees of the Trust is 
bound to follow such announcement of the Government in respect of 
such employees.  Consequently, these petitions are dismissed. 
 
 
 
 
 
 
CJ. 
 
 
 
 
Islamabad 
J. 
 
APPROVED FOR REPORTING 
*Hashmi* 
J. 
 
 
 
 
 
Announced in open Court on  12.06.2015  
 
 
 
 
 
J. 
 
 
