THE PORT CARGO CORPORATION, Appellant, and MESSRS MOHAMED THAMBY & SON, Respond

107-NLR-NLR-V-73-THE-PORT-CARGO-CORPORATION-Appellant-and-MESSRS-MOHAMED-THAMBY-SON-Respond.pdf


Port Cargo Corporation v. Messrs Mohamed Thamby «fc Son
553
1970 Present: H. N. G. Fernando, C.J., and Sirimane, J.
THE PORT CARGO CORPORATION, AppelJant, and MESSRSMOHAMED THAMBY & SOX, RespondentsS. C. 101IG6 (F)—D. C. Colombo, 1041 fSpl.port {Cargo) Corporation Act No. 13 of 195S, as amended by Act No. 67 of 1061—Sections 26 (1), 39, 40, 47, 55, 56, 57. 57A, 5$, 5SA, 59, 60, 62A, 62B—Gratuities payable by a port entrepreneur of the Port of Colombo after deductingcomjxnsation payable to him—Admission by the entrepreneur of the correctnessof the sum payable by him to the Port {Cargo) Corporation—Procedure forrcctvcry of the sum—Co-operative Societies Ordinance—Estate Ditty Ordinance{Cap. 211), s. 57—Income Tax Ordinance {Cap. 212), ss. 84, 85—Constitutionallaic—Power of Parliament to create a liability retrospectively.
In April 1903 tho Port (Cargo) Corporation filed in tho District Court a.C'ortificato in which tho Chairman of tho Board of Diroctors of tho Corporationcertified in terms of soction 62A of tho Port (Cargo) Corporation Act No. 13 of195S, ns amendod by Act No. G7 of 19G1, that a sum of Rs. 00,003 was due from(he respondent Firm to the persons who became omploycos of tho Port (Cargo)Corporation and who wero formerly omployed by tho said Firm at tho time whontho sorvicos porformod by tho Firm coased by virtue of tho provisions ofsection 20 (1) of tho Port (Cargo) Corporation Act. With this Certificate theCorporation also filod a petition moving the Court to issue writ of executionagainst tho respondent in terms of section 62B of tho Act for tho recovery oftho sum of Rs. 90,003 spocifiod in tho Certificate.
Objections to tho Certificate were raised by the respondent, and tho applica-tion fur writ of execution was refused by tho District Court on tho main groundthat, although Act No. 67 of 1961 which amendod soction 55 of the principalAct imposed on an entrepreneur a now and additional liability retrospectivelyin respect of pnymont of gratuities to omployocs whoso services had terminatedoil l.,« August 195S, tho Legislature had not in any express provision of theamending Act cloarly statod its intention to impose such retrospective liability.
Held, that sinco tho Certificate issued by the Chairman of tho Board ofDirectors under soction G2A of tho Port- (Cargo) Corporation Act was in factvalid on its face, tho Judgo was bound to porform the ministerial act, undorsection G2B, of directing a writ of oxeeution to issuo. It was not open to theDistrict Court to consider tho objections which wore raised by the respondent.The sum of Its. 90.003 was admitted by tho Firm to bo duo from it as gratuitioato tho employees after deducting the amount of its own entitlement to com-ponsnls'ii. Tho provisions, therefore, of section 47 (1) (a) (ii) were applicable,and the Corporation was bound by the Statuto to recover tho sum. Thoprocedure for recovery of tho money in tho prosont- caso was fairly comparablewith thu procedure for recovery of Estate Duty or Incomo Tax by applicationto n District Court.
Held further, that Act No. 67 of 19G1 which aincndod soction 55 of tho Port(Cargo) Corporation Act so as to imposo an additional liability rotrospoctivolyon Port entrepreneurs was valid. Tho Legislature has powor to create aretrospective liability, provided that its intention to do so is clearly oxprossodin tho relovnnt legislation.
L’.Vlir_->4• K 1351—2,255(2/71)
554
H. X. G. FERNANDO, C.J—Port Cargo Corporation v.
J/cssr» Mohamcd Thainby <t Son
Appeal from a judgment of tho District Court, Colombo.
II. W. Jayewardene, Q.O., with B. J. Fernando end Paul Perera, forthe petitioner-appellant.
C. Ranganalhan, Q.G., with K. Nadarajah and K. Kanagarainam, forthe respondent-respondent.
Cur. adv. vult.
November 7, 1970. H. N. G. Fekxaxdo, C.J.—
The Port Cargo Corporation Act No. 13 of 1958 provided by Section26 (1) that the Minister shall by Order declare that on and after tho datespecified in the Order certain Port Services shall be provided in the Portof Colombo exclusively by the Port Cargo Corporation. The Orderthus contemplated was made to take effect from 1st August 195S. Aconsequence of the Order was that as from 1st August 195S all PortEntrepreneurs ceased to have the right to carry on undertakings in thePort of Colombo for providing Port services. Subsequent Sections inthe Act provided for the vesting in or requisitioning by the Corporationof property of former Port entrepreneurs and ss. 39 and 40 providedfor the payment by the Corporation of compensation for such property.
Sections 55 to 57 of the Act relate to persons who had formerly beenemploj’ees of a Port Entrepreneur. The effect of sub-section (2) ofSection 55 was that if a per son had been employed by a Port entrepreneurat any time during the period commencing on 20th December 1950 andending on 1st August 195S, the employer shall pay a gratuity in respectof the employee’s service calculated at the rate specified-in-the sub-section.If after 1st August 1958 any such employee became an employee of theCorporation, then the gratuity due to him was to be paid to the Corpora-tion ; and if not, the gratuity was to be paid to the employee himself.
Similarly if a former employee of an entrepreneur had been a contri-butor to a Provident Fund and the employee became employed by theCorporation,- then s. 56 required the Administrators of the Fund totransfer to the Corporation the amount which was to the credit of theemployee in that Fund. _
Section 57 provided that , any sum due from an entrepreneur to aformer-'employee under a-collective agreement, shall, if the-1 employeebecame an employee of the Corporation be paid to the Corporation.
Section 47 of the Act of 1958 provided that where an entrepreneur isentitled to compensation from the Corporation, the Board of Directors -cViall pay from the amount of such compensation inter alia, (a) –any..-
655
H. N. G. FERNANDO, C.J.—Port Cargo Corporation v.
Messrs Mohamcd Thamby <t Son
sum certified a Labour Tribunal constituted under this Act to theChairman of the Board of Directors to be due from such person undersection Go, section 56, or section 57.”
The provision in s. 47, to which reference had just been made, wasintended to enable the Corporation to recover the sums which, by reasonof ss. 55, 56 and 67 became pajablc to the Corporation by an entre-preneur to or in respect of the latter’s former employees. But it was *apparently realized that that provision was defective in many ways ; forinstance, it necessitated a Certificate from a Labour Tribunal as to thesums due to the Corporation on this account from an entrepreneur, butthe Act (in s. 60) only authorised the Labour Tribunal to consider suchmatters in the event of a dispute between the Corporation and an entre-preneur as to the amount due. Thus there was no power for the Cor-poration in s. 47 to make a deduction under that section except in easeswhere the liability of an entrepreneur to make payments to the Corpora-tion under ss. 55 or 56 or 57 became the subject of a dispute. Anotherdefect or omission in the original provision in s. 47 was that if the amountcf the compensation due from the Corporation to an entrepreneur wasJess than the amounts paj'able to the Corporation by the entrepreneurunder ss. 55, 56 and 57, there was no special provision in the Act givingto the Corporation a means of recovering the deficit.
The Act No. 67 of 1961 amended the Act of 195S in a manner clearlydesigned to remedy these and other defects in the original Act. Section 47was amended by substituting, for the former paragraph (a) (reproducedabove), a much more comprehensive provision. Under s. 47 as thusamended the Board of Directors were required to pay from the com-pensation due to any person “ (a) any sum—
which is certified in writing by a Labour Tribunal constitutedunder this Act to the Chairman of the Board of Directors to bedue from such person under section 55, section 56, or section57 ; or
which is admitted by such person to bo due from Jiim undersection 55, section 56, or section 57, and is certified in writing bythe Chairman of the Board of Directors to that Board to liavebeen admitted by such person to be so due to an employee ofthe Corporation, or is certified in writing by the Commissioner ofLabour to the Chairman of the Board of Directors to have beenadmitted by such person to be so due to anyone who is not anemployee of the Corporation ; or
which is neither admitted nor denied by such persons to be duefrom him under s. 55, s. 56 or s. 57, and is certified in writing bythe Chairman of the Board of Directors to that Board to havebeen neither so admitted nor so denied by'such person and to beso due from such person to any employee of the Corporation, or
556
H.N. G. FERNANDO. C.J.—Port Cargo Corporation v.
Messrs Mohamad Thamby <fc Son
is certified in writing by the Commissioner of Labour to theChairman of the Board of Directors to have been neither soadmitted nor so denied by such person and to be due from suchperson to anyone who is not an employee of the Corporation ; ”
A new section 62A was also introduced in the following terms : —
" 62A. Where the compensation to which a person is entitled inrespect of any property vested n or requisitioned for the Corporation isinadequate to pay the whole or any part of any sum payable out ofthat compensation under section 47 (1) (a), then, if that sum is due toan employee of the Corporation, the Chairman of the Board of Directors,or, if that sum is due to an3'one who is not an employee of theCorporation, the Commissioner of Labour, shall certify in writingthe amount due from that person which cannot be £>aid out of thatcompensation.”
Thus the Legislature provided that when in any case the compensationdue to an entrepreneur under the Act was insufficient to enable theCorporation to pay out the sums specified in s. 47, the amount could berecovered from the entrepreneur under the authority of a certificateissued by the Chairman of the Board of Directors ; and a new section 62Bprovided that upon the production of this certificate before a DistrictCourt “ the Court shall direct a writ of execution to the Fiscal ” for theseizure and sale of property necessary for the recovery of the sum in .deficit,
I should also refer at this stage to another new section introduced bythe Act of 1961. The new s. 58A required every entrepreneur of the Portof Colombo to furnish to the Corporation a statement specifying the nameof every person in respect of whom the entrepreneur is liable to make apayment under s. 55 or s. 57, and also the amount of such payment andthe details of the mode of computation of that amount. Section 58Aalso required the Administrators of Provident Funds to which formeremployees had been contributing, to furnish similar statements regardingthe names of the former contributors and the amovint and mode ofcomputation of payments due to such contributors.
There was yet another amendment effected in 1961 which is ofimportance in the present case. The original s. 55 of the Act had providedthat the gratuities payable by an entrepreneur in respect of the servicesof his former employees should be calculated at the rate of one-half of onemonth’s salary for every 12 months of employment. It was apparentlythought or realized that under the original section no gratuity, will bepayable in respect of any part a period of employment falling short of acomplete year. The mode of calculation set out in the original s. 55 was •amended in 1961 so that the sum payable as a gratuity in respect of anemployee’s former service shall be calculated “ at the rate of one-half of ;one month’s salary for every 12 months and one and one-fourth dayswages for every complete month in every period of service”-.. ‘ .
H. X. G. FERNANDO, C.J.—Port Cargo Corporation v.
Mutrs Mohamed Thamby <£.* Son
557
Trior to the enactment of the amending Act, the Corporation had called. -for reports from entrepreneurs setting out particulars of the names ofemployees and of payments due to them whether in respect of gratuitiesas provided in s. 55 or in respect of amounts due to them on account oftheir contributions to former provident funds. In the present case, theRespondent Fjrm, which had previously carried on business of a Tortentrepreneur, had with the document A3 of 1st April 1959 furnished astatement, a summary of which is stated in A3 (2). According to thissummary, the Respondent Firm stated that the amount of the gratuitiesdue to its ex-employees taken over by the Port Cargo Corporation wasRs. 147,S75'52. A3 itself stated that the aggregate amount of gratuitiesdue from the Firm was Rs. 91,961 -72, and it is common ground now thatthis sum of Rs. 91,9621-72 was the amount payable as gratuities by theRespondent Firm in terms of the original s. 55 of the Act, that is to say,in respect of the services of past employees for all complete periods of 12months. It is also common ground that this figure was properly reachedby the deduction from the sum of Rs. 147,875 52 ofasumof Es. 55,913 80which had apparently (according to A3 (2)) been the employers’ formercontributions to Provident Funds.
I have referred already to the amendment of s. 55 in 1961 whichincreased the amount of gratuities by requiring periods of less than a yearto be taken into account in the computation of gratuities. The amend-ments of 1961 became effective on December 7, 1961, when assent wasgiven to the amending Act. Thereafter, the Respondent Firm furnishedthe documents A7 and A7 (1), the former being a summary of the latter.These documents wore presumably furnished in terms of the new scot ion57A which required the Respondent Firm to furnish a statement of thenames of its former employees and the total amount of the gratuitiespayable in terms of s. 57 (a) as amended. According to the summary thegratuities in respect of seven categories of employees was stated to beRs. 185,004-25. In addition the last two pages of the statement A7 showgratuities due to two other categories of employees, i.c., Labour Super-visors and Office Clerks. The total stated by the Respondent Firm in thedocuments as being due is thus Rs. 1S9.234 S6.
On 2Sth September 1962, the Corporation wrote to the Respondent theletter AS setting out what was according to the Corporation the presentposition “ with reference to the payment of addit onal gratuity" on theStatement- supplied by you In this letter the Corporation first gavecredit to the Respondent for Rs. 34,244 as amount of the compensationaward and for Rs. 55,$53 as the amount of the Respondent Firm’s con-tribution to the Provident Fund. (It will be seen that the figure in ASin respect of contr:butions to the Provident Fund differs only m milclyf:om the corresponding amount which the respondent had cla/Dird in thestatement A3 (2).)
K 1351/2/71)
558
H. N. G. FERNANDO, C.J.—Port Cargo Corporation v.
Messrs Mohamcd Thamby efc Son
In A8, the Corporation claimed, on account of gratuities duo to theFirm’s employees, a sum of Rs. ISO,100 ; after giving credit for thetwo amounts referred to in the preceding paragraph, the Corporationdemanded from the Respondent a sum of Rs. 90,003.
In April 1963, the Corporation filed in the District Court a Certificate in(he following terms : —
" I, Vidane!age Samson Manuel do Mel, Chairman of the Board ofDirectors of the Port (Cargo) Corporation do hereby certify in terms ofSection 62A of the Port (Cajgo) Corporation Act, No. 13 of 1958, asamended by the Port (Cargo) Corporation Amendment Act, No. 67 of1961, that a sum of Rupees Ninety Thousand and Three (Rs. 90,003) isdue from the Respondent Firm to the persons who became employeesof the Port (Cargo) Corporation and who were formerly employedb}' the said Firm M. Mohamed Thamby & Son, when the servicesperformed by the said Firm ceased by virtue of the provisions ofSection 26 (1) of the Port (Cargo) Corporation Act.”
With this certificate the Corporation also filed a petition moving theCourt to issue writ of execution against the Respondent in terms ofs. 62B of the. Act for the recovery of the sum of Rs. 90,003 specified bythe Certificate.
■ On this motion the learned District Judge ordered the petitioner tosupport the motion on 23.5.63. On that day Counsel for the petitionerinformed the Court that notice had been given in writing to theRespondent Firm of the filing of the Certificate, but upon the orderof the Judge, Counsel agreed that notice be served on all the membersof the Firm, Thereafter proxy was filed ori behalf of all the membersand also their objections. The learned District Judge then proceededto hold an inquiry into those objections.
At a later stage of the inquiry the objections wero formulated in theform of issues as follows : —
** 1. Do the provisions of Port (Cargo) Corporation AmendmentAct No. 67 of 1961 apply in respect of any gratuity payable in respectof . the relevant period commencing 20th December 1950 and ending31st July 1958.
2.- Are tho provisions of s. 62A and 62B of the Act No. 67 of 1961applicable to gratuities if any payable in respect of the said period.
3- Does the certificate marked A conform to the provisions ofs. 62A of the Act No. 67 of 1961.
Docs the certificate marked A or the production thereof tot-hiB Court entitle the petitioner to-any one or more of the reliefsclaimed by the petitioner.
H. N. G. FE KN'AXDO, C. J.—Port Cargo Corporation r.
Messrs Mohamed Thamby <fc Son
559
(a) Is the Chairman empowered by section 62A(a) to issue onocertificate in respect of the aggregate amount due as gratuity to anumber of employees.
(b) to issue n certificate in respect of the gratuity referred to inparagraph 7 and/or S of the petition.
Is the petitioner entitled to apply for one writ for the recoveryof the aggregate amount aforesaid.
If one or more of the issues 1 to G are answered in the negative —
is the certificate marked A invalid and of no. force or avail in
law.
can the petitioner have and maintain this aj^plication or action.
S. Is the plaintiff's action prescribed.
(a) At the time of the issue of the certificate marked A, hasthe full amount of the gratuities been paid to the employees.
(b) If so, can the petitioner have and maintain this application oraction.
Did the petitioner reduce or agree to reduce by way of reliefthe gratuity alleged to be payable by the-respondent by a sum ofIts. 34,948.
What sum is due to the petitioner upon the sum of Rs. 43,244ns interest under the provisions of the Act No. 13 of 1958.
Is the certificate marked A invalid, void and of no force orvH'cct in law, in that the amount in the said certificate hasbeen computed without giving credit to the defend arils or takinginto account the said sum of Rs. 34.94S and the interest aforesaid.
In connection with issue No. 2, it was contended for the respondentthat the amendment of s. 55 which was effected by the amending Actof 19G1 created a new and-.additional liability: whereas the originals. 55 provided only for the paj-ment of a gratuity in respect ofan employee’s past services calculated at the rate of 15 days wages forevery completed 12 months service, the amendment of 1901 providedndditionallj* for the payment of a gratuity in respect of each additionalcomplete month, in the period of service. It was further contendedthat in this way the amending Act created in 1961 a new liability inrespect of cmplo3*ecs whose services had terminated on 1st August1958 ; that, although the new liability was retrospective, the Legislaturehad not in any express provision of the amending Act clearly statedits intention to impose such retrospective liability.
5G0* H. N. G. FERNANDO, C.J.—Port Cargo Corporation v.
Messrs Mohamcd Thamby <0 Son
The learned District Judge agreed with this contention of the res-pondent firm, and .this was the principal ground upon which he rcjectcilthe petitioner’s application for execution. Since however there hadbeen full arguments on the other objections taken by the respondent,the learned Judge also briefly expressed his views on those objectionsand held that they were not maintainable.
In appeal, Counsel for the Corporation lias argued that under theprocedure contemplated in ss. 62A and. 6213, the District Court had nojurisdiction to consider any of the objections which were formulated onbehalf of the respondents. Counsel conceded that when an applicationis made to a Court for execution in terms of a provision like s. 62A theCourt may consider whether the certificate upon which the applicationis based is valid on its face in the sense that it is issued by an authoritycompetent to issue it and that it specifies that a sum is due from theperson named in it. .Counsel was also willing to concede that sincesub-section (2) of s. 62B requires notice to be given to the person concernedof the issue of the certificate, it was open to the District Judge to hearthe respondents on the question whether a certificate under s. 62A wasvalid on its face. Counsel’s principal argument was that since thecertificate in't-his case was in fact valid on its face, and since the Judgedid not find in the certificate any invalidity of this nature, he was boundto perform the ministerial act under s.62B of directing a writ of executionto issue.
Counsel for the respondents relied on the majority decision inBandahamy v. Senanayake which approved the decision in Jayasinghev. Boragodawatta Co-operative Stores2.
It is sufficient for present purposes to cite the relevant statement ofGratiaen J. in the latter case which w-as approved by the majority decisionin the former :-?•
“ The principle involved' is one of substance and not merely-, ofform. Justice requires that a party who invokes the aid of a Courtto obtain the enforcement of an extra-judicial decision purportingto grant him relief against someone else should proceed in two stages :(1) he must in the first instance place sufficient material before theCourt to establish that the decision in question had been validly madeby a person vested with jurisdiction over the dispute ; and (2) it isonly after he has obtained judicial recognition of the extra-judicialdecision that he may proceed to take steps to have it carried intoexecution.- It would be quite improper for the Court to grant finalrecognition t-d^an extra-judicial decision without giving the’ party-alleged to be affected, by ;it an opportunity of challenging its.,validity. V:■; ' ' " J.r o,r • v . ■ – -■
. .(I960) 62 N.L. It. jii.;* 0955) 56 N. L. R. 462. "’
I
H. N.C.FERN'ASDO, C.J.—Port Cargo Corporation v.561
Messrs JUohamed T Hamby «fr Son
It will be scon that in the instant case the last of the pre-requisitesformulated by Cratiacn J. was clearly satisfied in that the respondentfirm did have an opportunity to challenge the validity of the certificate.The further question is whether and to what extent the dictum of Gratiacn
J.is applicable to a consideration by the District Court of the validityof a certificate purporting to have been issued under such a provisionns s. 62A of the Port Cargo Corporation Act. I think it proper totake into account in this connection the respective contexts : the one,in which an award is made under the Co-operative Societies Ordinance,and the other, in which a certificate is issued under s. G2A of the PortCargo Corporation Act.
The dictum cited above from Jayasinghe's case indicates that anarbitrator's award is one made upon a dispute, and it is obvious thatsuch an award is a nullity if it was made by a person “ not vested withjurisdiction over the dispute In fact Gratiacn J. himself, in theearlier case of IK. Barnes tie Silva v. Galkissa Wallarappola Co-operaliveStores Society 1 stated his opinion more fully when he said that " it isthe clear duty of a Court of law whose machinery as a Court of executionis invoked to satisfy itself, before allowing writ to issue, that the purporteddecision or award is prime facie a valid decision or award made by aperson duly authorised under the Ordinance to determine a disputewhich has properly arisen for the decision of an extra-judicial tribunalunder the Ordinance. ”
I nyself entirely agree that the prima facie validity of an awardmade under the Co-operative Societies Ordinance is not established,unless the award lias been made by a person properly constituted thearbitrator in a dispute, and unless the nature and character of the dispute,and the parties to a dispute, are such that it . was properly referableto arbitration in terms of the Ordinance. If these conditions are notsatisfied, the award is a nullity for the reason that the arbitrator hadno jurisdiction to make the award. In the context therefore of theCo-operative Societies Ordinance, the question whether an award hasprima facie validity depends on the existence of facts which are notapparent on the face of the award and the presence of which haveto be prima facio established to the satisfaction to the Court ofexecution.
Let me now examine the circumstances in which a certificate is issuedunder the new Section G2A of the Port Cargo Corporation Act. Whena former employer is liable under any of the provisions of ss. 55, 5G andf>7 to pay an}- sum to the Corporation in respect of past employees,s. 47 provides that such sums shall be paid out from the compensationto which the former employer is entitled. Hut this payment is onlymarie upon the authority of a certificate issued under one of the threesub-paragraphs of s. 47 (1) (a).
1 (1953) 54. X. L. Ji. 320.
562
H. N. G. FERNANDO, C.J.—Port Car-jo Corporation v.Messrs Mohamed Thamby <£.• Sou
A certificate under the let of the sub-paragraphs is one issued by aLabour Tribunal. The circumstances in which such a certificate willbe issued by a Labour Tribunal could perhaps have been set out in theamending Act in clearer terms. Nevertheless, the object of s. 59 (asamended in 1961) was that if a claim to a payment due under ss. 55, 56or 57 is made by the Corporation to a former port employer, the employerhas the right to refer the claim to a Labour Tribunal; and the Tribunalwould then, if it upholds fully or partly the Corporation’s claim, issuethe certificate which is referred to in the 1st paragraph of s. 47 (1) (a).In the instant case the Corporation made a claim of Rs. 90,003 in theletter A8 of 2Sth September 1962. The respondent firm, if desirous of-contesting that claim, could have referred that claim to the LabourTribunal. Since however no such reference was made, there was no6Cope in this case for the application of the first sub-paragraph ofs. 47 (1) (a).
' In fact there was issued in this case a Certificate (A2) of 2nd January1963 which is refer able to the second sub-paragraph of s. 47 (1) (a). Inthis certificate, the Chairman of the Board of Director s of the Corporationcertified to the Board of Directors that the respondent firm had admittedthis amount to be due. It has been ihown earlier in this judgment thatthe sum of Bo. 1S9.100 specified in the Corporation’s “ claim ” (AS)was based on computations stated and summarised in the statementsA7 and A7 (1), which were furnished by the respondent firm, andthat the deduction from this amount which was allowed to the firm onaccount of its former contributions to a provident fund was also basedon the statement A3 which had been furnished by the firm on 1st April1959. After the claim A8 was made by the Corporation in September1962, and until March 1963, the firm neither referred the claim to aLabour Tribunal nor denied in any way the correctness of that claim.In these circumstances the Chairman in my opinion correctly certifiedto the Board by A2 that the firm had admitted liability in respect ofits employees of the amount of Rs. 189,000 odd reduced by the totalof its former contributions to the provident fund.
Let me refer also to the third sub-paragraph of s. 47 (1) (a), in order tocomplete my examination of the “ schema ” in the Act. Under thissub-paragraph the certificate of the Chairman may state that an amountis neither admitted nor denied to be due. The sub-paragraph providesfor an eventuality different from: the two eventualities contemplatedin the two earlier sub-paragraphs. If for instance the Corporation makesto an employer a claim which is not based on the employer’s own com-putation, and if the. employer does not refer that claim to a LabourTribunal, and if furthermore the firm does not make to the Corporation,a denial of liability, the case would appear to be one in which the liability'is neither admitted nor denied. If so, the Legislature contemplated theissue of a'certificate under the. third sub-paragraph.
H. N. O. FERNANDO, C.J.—Port Cargo Corporation v.
Messrs Mohamed Thamby <£.• Son
563
Upon the issue in this case of the Chairman’s Certificate A2 to theJBoard of Directors, the substantive provision of s. 47 became operative,namely that the Corporation became bound to pay out the sums so certifiedns being due to employees of the Corporation, and (in terms of s. 5Sof the Act) to credit the payment to the individual accounts of therespective employees. Thus although the liability of a former employerunder ss. 55, 56 and 57 is to'make certain payments to the Corporation,and although in appearance the Chairman issued a Certificate as to apayment due to the Corporation itself, yet in fact the Corporation wasmerely an agent required by the Statute to receive these paymentsfor the benefit of its employees. I must repeat that the Corporationwas bound by the Statute to recover these payments. If then thecompensation to the credit of the Respondent Finn had sufficed to defraythe certified liability, the Corporation was perfectly entitled in terms ofthe Act to apply that compensation in the payment of the firm’s Lability ;and in the circumstances of the instant case, I much doubt whetherthe Respondent Firm could have had any legitimate complaint if theamount to its credit had been exhausted by' a recovery in terms of theCertificate. Thus the only reason why it was necessary for the Cor-poration to resort to s. 62A was because the firm’s liability exceededthe amount of the compensation to which the firm was entitled. Inthe result, the Certificate issued under s. 62A that a sum of Rs. 90,000was due, -was a mere arithmetical computation of the difference betweenthe firm’s liability (which I have shown was admitted) and the amountof its omi entitlement to compensation, which latter has never beendisputed. In these circumstances, one can easily understand whythe Legislature clearly expressed in s. 62B its intention that onproduction of the Certificate, a District Court “ shall direct a writ ofexecution
In my opinion the provisions of 6S. G2A and 62B of the Act are fairlycomparable with other statutory provisions which have in recent yearsbeen the subject of decisions in our Courts, namely s. 57 of the EstateDuty Ordinance (Cap. 241), and 6s. 84 and 85 of the Income Tax Ordinance(Cap. 242).
In Banaueera v. Commissioner of Inland Revenue 1 it was held thatwhen a Certificate of collection to recover Estate duty is issued by theCommissioner of Inland Revenue in terms of s. 57 of the Estate DutyOrdinance, it is incumbent on a District Court to issue" a writ of execution ;and it was pointed out that in such a case the Court has no dutyto satisfy itself whether the application for execution is in conformitywith the Rules of the Civil Procedure Code covering applications forexecution.
1 (1965) C7 S. L. It. 13J.
564H. X. G. FKRNAXDO, C. J.—Port Cargo Corporation v.
Messrs Mohamad Thamby dr Son
In a case between the same parties reported in 70_>fe,L.-R. p. 564, aCertificate for the recovery of Income Tax had Hfen issued to the DistrictCourt under s. 84 of the Income Tax Ordinarn^ One point which wasraised was that the Commissioner had not in his Certificate repeatedthe words of the section, that recovery by other means was impracticableor inexpedient. The Court however held that such a statement wasunnecessary. Both these decisions proceeded on the basis that iuordering execution upon a Certificate for the collection of Estate Dutyor Income Tax, a District Court acts only ministerially and hot judicially.The same principle was recognized in 70 N. L. R. p. 294, although inthat case it was pointed out that if the Court stays execution after writwas issued, then the Court does act judicially.'
I ara unable to agree with the contention of Counsel for the RespondentFirm that there is a ny valid distinction between the procedure for recoveryprovided in ss. 62A and 62B of the Port Cargo Corporation Act, and theprocedure for the recovery of Estate Duty or Income Tax by applicationto a District Court. The issue of a Certificate under s. 62A is not precededby anything which can be properly called a.decision in a dispute betweenthe Corporation and an employer. Save in a case in which a claim bythe Corporation is actually challenged by reference to a Labour Tribunal,the Certificate issued is for the recovery of an undisputed liability,and in the instant case the amount of the liability was computed by theemplo3’er himself. If the employer thought fit to ohallenge even hisown computation, then it was open to him to refer the Corporation’sclaim to a Labour Tribunal. The Act having properly provided a meansof redress to an employer who disputes the Corporation’s claim, theAct then adopts a Certificate procedure for the recovery of amountswhich are either undisputed or which are certified by the appropriateTribunal.
For these reasons I hold that it was not open to the District Courtto consider the objections to the Certificate which w-ere raised in thiscase.
Although the conclusion just stated is decisive, I will, out of deferenceto the learned District Judge and to learned Counsel who appeared forthe Respondent Firm, briefly discuss some of the objections taken bythe Respondent.
Section 55 of the Port Corporation Act, as originally enacted, imposedin May 1958 a liability on employers in the Port of Colombo to paygratuities to their employees in respect of periods of employment wjiichcommenced long before 1958 and which were due to terminate afterMay 1958.'- The section as amended- in' 1961 imposed-an additionalliability to pay a further gratuity in respect of some months in'the'same *periods, which periods had terminated before 1961.- Let me now assume
H. X. G. FERNANDO, C.J.—Port Cargo Corporation e.
Messrs Mohamcd Thamby <Cr Son
563
that tho learn, v District Judge correctly decided that the additionalliability was rctrospe'♦ively imposed. Since the power of Parliamentto create a retrospective liability is not and cannot be denied, the onlyquestion is whether the intention to create such a liability was clearlyexpressed in the relevant legislation.
At tho time when the Amending Act of 1901 was enacted, an Orderunder s. 26 of the principal Act- had already been made (effective on SthAugust 195S) by reason of which former port entrepreneurs had becomedisentitled to carry on undertakings in the Port of Colombb ; and by thattime also, the former employees of such entrepreneurs had censed to betheir employees. The additional liability was imposed in 1961 by anamendment of tho original s. 55, which in terms (cf. sub-section (1))applied only to employees in the Port of Colombo. The additionalliability itself was to pay gratuities in respect of some months in periodsof employment which had terminated long before 1961. Hence the soleeffect of the amendment of s. 55 was to require the payment of additionalgratuities—
(а)only by former entrepreneurs in the Port of Colombo;
(б)only to their former employees ; and
(c) only in respect of former periods of employment.
I cannot imagine any terms in which Parliament could have expressodmore clearly an intention to impose a retrospective liability.
There was also a submission that ss. 62A and 62B arc hot applicablefor the recovery of the amounts due as gratuities under the originals. o-5, on tho ground that the remedy provided in these two sectionsis not available to the Corporation. This submission is founded on anargument that Parliament has not clearly expressed its intention thattho two new sections can bo utilised by the Corporation to recover theamounts of gratuities duo under the original s. 55. I
I have already pointed out that tho original expectation of Parliamentin enacting s. 47 was that the amount of compensation due to a portentrepreneur would suffice to enable the Corporation to pay therefromthe amount of gratuities to employees due from the entrepreneur. Buts. G2A in terms establishes a design of Parliament to provide for n- casein which tho -ompensation due to an employer “ is inadequate to paya sura payable out of the compensation under s. 47 (1) (a)”. Evenafter the amendments of 1901, the major part of the sum payable unders. 47 (1) (a) is attributable to the liability to pay gratuities which wasimposed in the original s. 55 of the Act.
566H. N. G. FERNANDO, C.J.—Port Cargo Corporation v.
Messrs Mohamtd Thamby tk Son
Parliament has explicitly stated in s. 62A that the Certificate procedurewill be available to the Corporation for the recovery of sums payablein terms of s. 47 (1) (a), which clearly provided, both before and afterits amendment, that the sums due as gratuities under the original s. 55of the Act had to be paid under s, 47 (1) [a). Parliament has thusmanifested its intention that the Certificate procedure is applicable for,and only for, the recovery of sums payable under s. 47. If ss. 62A and62B are retrospective, in that they provide a new remedy for the recoveryof a past liability, Parliament has clearly manifested tile intention thatthe new remedy is retrospective.
The two submissions which have now been rejected were in substancearguments that the relevant enactments of Parliament are meaninglessand futile. It will perhaps assist Counsel to know that the Courtswill presume that enactments of Parliament arc both meaningful andpurposeful, unless the contrary is clearly established.
I need refer only to one other matter. It appears that at some stagethe Cabinet had decided that some part of the liability of former PortEntrepreneurs to pay gratuities to their former employees would, as aconcession to these Entrepreneurs, be borne by the Government.Accordingly, the Respondent Firm had in its statement A7 claimed adeduction from its liability on this basis, and the Corporation in itsclaim A8 of September 1962, had allowed for that deduction in demandingimmediate payment of its claim. Had the Respondent complied withthat demand for payment on the reduced basis, the matter would nodoubt have ended there. But since such payment was not in fact made,it became necessary for the Corporation to set in motion the statutoryprocedure for the recovery of what was statutorily due from the RespondentFirm to its former employees. The statutory procedure necessitatedthe issue by the Chairman of the Certificate A2 of the amount due underthe Statute, and the subsequent Certificate under s. 62A had necessarilyto be issued for the recovery of the difference between the amountcertified in A2 and the amount due as compensation to the RespondentFirm.
The submission of Counsel in this connection was that the Certificateissue?! under s. 62A is invalid, for the reason that the Certificate shouldhave taken into account the Cabinet decision that the Government willbear a part of the liability of the Respondent Firm. There may havebeen substance in this submission, if, before the issue of the Certificate,Parliament had passed a resolution to assume or under-write'a part ofthe statutory liability of the Respondent Firm. Evidence of such aresolution of Parliament could easily have been available. In the absenceof any such evidence, the statutory liability of the Respondent. Firmremained intact, and the Corporation was in my opinion bound to issuethe Certificate actually issued under s. 62A of the Act.,
SIVA SUPRAMANIAM, J.—Scnevira/ne v. Jahan
567
For these reasons, I would allow the Corporation’s appeal. TheDistrict Judge will order writ of execution to issue, against the Res-pondent Firm in terms of s. 62B of tho Act, The Respondents willpay to the Corporation the costs in both Courts.
S'uumaxk, J.—I agree.
Appeal allowed.