Khalid Tawab betrays the history of trade associations – Nasser Hyatt Maggo

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There is a surprising move unearthed in the history of trade associations of Pakistan that a presidential candidate for elections of an apex body like FPCCI; Khalid Tawab was not even a bona fide member of any association but he claimed as leader of business community and Member FPCCI Executive Committee.

It has been disclosed by Mian Nasser Hyatt Maggo, Member Executive Committee and President FPCCI on behalf of Pakistan Chemical and Dyes Merchant Association who filed a complaint before Director General Trade Organizations, Islamabad against Khalid Tawab (Member Executive Committee), Pakistan Iron and Steel Merchants Association, nominated on behalf of M/s F. Rabbi Steel (Pvt) Ltd.

Nasser made respondents M/s F. Rabbi Steel Pvt Ltd., Pakistan Iron and Steel Merchants Association through its Secretary-General, and the Federation of Pakistan Chamber of Commerce and Industry, through its Secretary-General. It is a mockery of the Act and the Rules of 2013, to allow such bogus members to participate in the election process to defeat and curtail the right of bona fide members of Trade Organizations and other bona fide business interest within Pakistan, the petition said.

Rule 15 of the Rules of 2013 provides that the eligibility of a member of Trade Organization to vote at the elections depends upon the member fulfilling the conditions of membership. The Respondent does not fulfill the conditions of membership of the respective Trade Organization from which he has been so nominated, Mian Nasser Hyatt Magoo added.

The Complaint was filed u/s 14 (1) & (3) of the Trade Organizations act, 2013 read with all other Enabling/ applicable provisions of the act and the Trade organizations rules, 2013. Mian Nasser Hyatt Magoo requested the DGTO to declare Khalid Tawab and his Company ineligible to be the members of the Pakistan Iron and Steel Merchants Association and renewal of his Company’s membership for the year 2020-2021 and 2021-2022 in violation of the Act and the Rules.

He requested that the Pakistan Iron and Steel Merchants Association be directed to forthwith revoke the Membership of Khalid Tawab’s Company and the representative character of Khalid Tawab as Member Executive Committee FPCCI be consequently declared as null and void and void ab initio by declaring that he was not eligible to be nominated. Pakistan Iron and Steel Merchants Association may be proceeded against for cancellation/ revocation of license for not complying with the mandatory provisions of the Act and Rules, of 2013.

According to details Mian Nasser Hyatt Maggo stated that Khalid Tawab claims to be the Chairman of F. Rabbi Steel Pvt Ltd and contested election for the post of ‘President’ FPCCI while his Company is not eligible and qualified to be a member of the Respondent Association. His Company does not fulfill the conditions for grant and renewal of membership of the Association and was therefore not qualified to represent the Association on Executive Committee of FPCCI; the Respondent Company is a mere sham and a vehicle to remain politically relevant in FPCCI, he alleged. Moreover, the Association is also not complying with the provisions of the Act of 2013 and the Rules of 2013, and is liable to be struck off as an eligible member and as a licensed Association.

The complainant further disclosed that Khalid Tawab and his Company is making a mockery of the Act of 2013 and the Rules of 2013 – the Company from which he claims to be the representative nominee, is not eligible and qualified to be and to remain as a member of the Association. The Company is a vehicle to pursue political goals and thus to serve vested interests. It is being so said because spurious, fictitious and in-genuine members obviously have no roots in the business community and do not serve the interests of the business community they seek to be the representatives off.

Nasser Hyatt Magoo further added that perusal of the sales tax/ federal excise return being submitted by Khalid Tawab’s Company since 2017 shows that the return is nil/ zero; the company is not engaged in any business and is redundant; the Company is listed as an ‘Importer & Exporter’ however the sales and federal excise tax return being nil/ zero demonstrates that the company is not engaged in any business activity and thus is not paying any sales tax and is a mere sham. The tax returns being filed by the Company also demonstrate a similar position, since 2017 till date.

The Financial Statement of the Company as at June, 2019 depicts that the Company does not have any employees and has been going in losses with no business activity. Therefore, the Respondent cannot be a member of a sector specific association under the Act of 2013, and the Rules thereto, having no business interest from the one the association has been organized to represent. Under Section 3(2) (d), an Association is the one organized to represent a specific trade, industry or service. As per the definition provided by Rule 2(c) of the Rules of 2013, an Associations means an Association with membership on all Pakistan basis organized to represent a specific trade, industry or service or any combination thereof as provided in Clause (d) of Sub Section (2) of Section 3 of the Act.

The term ‘member of a trade organization’ is defined in Section 2 (i) as meaning a firm and includes a proprietorship, an association of persons, a partnership, a company or a multinational corporation engaged in trade, industry of services. One of the conditions of eligibility for license for an ‘Association’ referred in Rule 3 (2) (d) (iii) is that its members are stakeholders in the relevant trade, industry of service. The Respondent Company is definitely not engaged in any trade, industry or business and is a nonexistent redundant business which is being used as a means to maneuver way into FPCCI for other vested interests.

The Respondent Company also does not qualify to remain as either a corporate or associate member of the Respondent Association, and as held by this Hon’ble Court in the Judgment in Aftab Barlas Case and the case of Gulzar Feroz vs. DGTO Judgment dated 15-12-2020 wherein it has been held that the prospective member has to have a business within the defined business scope for which the association is formed and that the conditions for the grant of membership and renewal thereof as provided for by Rule 11 is to be read with Rule 15 of the Rules of 2013. The Respondent Company is surely not engaged in any trade or business and thus was not entitled for the grant of renewal of membership and therefore could not have been nominated by the Respondent Association to represent it at the FPCCI.

The Respondent Association is also not complying with the mandatory provisions of the Act and Rules of 2013 and therefore the license of the Association is liable to be cancelled/ revoked forthwith. The Respondent Association does not have any ‘website’ which is violation of Rule 25 of the Rules of 2013, the petitioner disclosed.

The Rule 11 of the Rules of 2013, provides for the membership of Trade Organizations and wherein it is postulated that the prospective members business should fit within the defined business scope or are of jurisdiction of trade organization as provided in the said Trade Organizations approved Memorandum and Articles of Associations and under the license granted by the Federal Government.