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New Bhopal Textiles, Ltd. Vs. Ramdutt Chaturvedi and ors. - Court Judgment

LegalCrystal Citation
SubjectLabour and Industrial
CourtMadhya Pradesh High Court
Decided On
Judge
Reported in(1961)IILLJ580MP
AppellantNew Bhopal Textiles, Ltd.
RespondentRamdutt Chaturvedi and ors.
Cases ReferredIndian Iron and Steel Co. v. Their Workmen
Excerpt:
.....other kind of construction but a singular one. section 50 (4) proviso (as inserted by act of 2004): [dipak misra, krishn kumar lahoti & rajendra menon, jj] preparation of town development scheme held, proviso is not retrospective. scheme already finalised will not lapse and has to be completed within the time span provided under proviso. no vested right accrues in favour of authority on commencement of process of preparation of scheme, which cannot be impaired by introducing proviso. section 50(4) proviso (as inserted by act of 2004): [dipak misra, krishn kumar lahoti & rajendra menon, jj] preparation of town development scheme held, proviso uses the term shall be deemed to have lapsed. it does not convey that scheme gets automatically lapsed. .....special protection under industrial laws, the employees who are not so protected and rest their rights on contract alone cannot claim reinstatement even in case of wrongful dismissal by the employer. the only action which the employee can take for wrongful dismissal is to claim damages for breach of contract.8. in this connexion, i may refer to para. 991 on p. 519 of halsbury's laws of england, 3rd edn., voi. 25, where it is stated:the fact that the dismissal of the servant is otherwise than in accordance with the procedure laid down in his contract of service, does not, however, in a case where the rights of the parties are regulated by contract and are unaffected by statute, normally prevent the dismissal from being effective to terminate the contract; in such a case the servant.....
Judgment:

T.C. Shrivastava, J.

1. Three suits out of which these three appeals arise were filed by the respondents Ramdutt Chaturvedi, Gourishankar Mathur and Gourishankar Shrivastava, respectively, in the Court of the Second Additional Subordinate Judge, Bhopal, for arrears of pay and for their reinstatement on posts from which they were dismissed by the appellant. The suits were dismissed by the trial Court by a common judgment. The respondents went up in appeals to the Additional District Judge, Bhopal, who allowed the appeals and decreed the claims. Against this judgment, the appellant (New Bhopal Textiles, Ltd. Bhopal) have filed three appeals, viz., Second Appeals Nos. 518, 517 and 516, all of 1858. As these appeals arise out of the same judgment and common questions are involved, this judgment governs the disposal of all the three appeals.

2. It is not disputed that the three respondents were in the service of the appellant drawing a salary of Rs. 100, Rs. 115 and Rs. 99-12-0 per month, respectively. They were arrested on 18 January 1950 and were detained under the Preventive Detention Act till 24 April 1950. On release, they applied to the appellant for being taken in service, but they were orally told that their services had been terminated and on 20 May 1950 a formal order terminating their services was given to them.

3. The case of the respondents was that while under detention they had applied for leave to the appellant but did not hear anything from them. On release, they were entitled to be continued in service, as their tenure of office was permanent. The termination of their services by the appellant was wrongful and therefore they claimed arrears of pay till the date of filing the suits as also an order from the Court reinstating them in employment.

4. The appellant as defendant pleaded that the services of the respondents were terminated on account of long absence on 1 March 1950 and a formal order was delivered to them on 20 May 1950. It was stated that the appellant had a right to terminate the services of the respondents on account of absence and could not be forced to take them back in employment. The appellant also stated that the respondents had been paid salary up to 20 May 1960 as a special case and therefore they were not entitled to any damages for breach of contract. At any rate, they pleaded that the relief of reinstatement could not be granted.

5. The lower appellate Court found that the respondents had sent applications for leave to the appellant and the appellant was bound to grant it. Accordingly, it was held that the order terminating the services of the respondents was illegal. Further, the lower appellate Court placed the burden of proving the terms of the contract and the rules and regulations regarding service conditions on the appellant, and in the absence of proof it was held that the respondents were entitled to leave as of right. Accordingly, the appeal of each respondent was allowed and the relief, as prayed for, was granted.

6. The learned Counsel for both the parties have admitted before me that at the material time in 1950 there was no law governing the relations of the employers and employees in industries in Bhopal. They admitted that the relationship between the parties was thus governed by the normal law applying to master and servant unmodified by any statute.

7. The lower appellate Court also proceeded on the same assumption, but wrongly observed that an employee is entitled to leave as a matter of right and that it is for the employer to prove the terms of the contract or rules relating 'to service conditions. The normal rule is that every master and employer has an undoubted right to dismiss his servants or agents at any time. There is no law which compels a master to retain in his service a person who has ceased to possess his confidence, or whose services he no longer requires. The remedy of the servant for wrongful dismissal is by an action for damages he may have sustained in consequence of the breach of the master's contract to employ him. [See Ranee Usmut Koowar v. W. Tayler (1865) 2 W.R. 307]. The case of dismissal of an employee is one which is governed by the law of contract. Unlike Government servants whose rights have been enlarged by Article 311 of the Constitution or of workmen who have special protection under industrial laws, the employees who are not so protected and rest their rights on contract alone cannot claim reinstatement even in case of wrongful dismissal by the employer. The only action which the employee can take for wrongful dismissal is to claim damages for breach of contract.

8. In this connexion, I may refer to Para. 991 on p. 519 of Halsbury's Laws of England, 3rd Edn., VOI. 25, where it is stated:

The fact that the dismissal of the servant is otherwise than in accordance with the procedure laid down in his contract of service, does not, however, in a case where the rights of the parties are regulated by contract and are unaffected by statute, normally prevent the dismissal from being effective to terminate the contract; in such a case the servant cannot claim that the contract has not been validly terminated, and his remedy is in damages.

9. I may also refer to the decision in R. v. National Arbitration Tribunal (1947) 2 All. E.R. 693. In that case, the validity of the award of a tribunal functioning under an emergency labour legislation was considered. Lord Goddard, C.J., observed:

If an employer breaks his contract of service with his employees either by not giving notice to which the latter are entitled or by discharging them summarily for a reason which cannot be justified, the workmen's remedy is for damages only. A Court of equity has never granted an injunction compelling an employer to continue a workman in his employment or to oblige a workman to work for an employer.

10. Under Clause (b) of Section 21 of the Specific Relief Act read with the Illustrations thereunder, the performance of a contract regarding personal service cannot be specifically enforced. The order for reinstatement of the respondents has that effect and therefore the order of the lower appellate Court in the instant case is contrary to law. The respondents absented themselves on account of their being put in detention by the Government of Bhopal. Sri S.C. Dubey for the respondent Ramdutt Chaturvedi contended that the absence which entitles an employer to terminate the services of an employee must be voluntary absence. In other words, if the absence was for causes beyond the control of the employee, the employer has no right to terminate his services. He did not cite any authority in support of this contention. Sri V.S. Dabir, on the other hand, supported the case of the other two respondents on the ground that after release from detention they were entitled to a formal enquiry by the management and the order of dismissal passed without such enquiry violates the rules relating to natural justice.

11. The point raised by Sri Dabir was considered by the Supreme Court in Burn and Co. v. Their Employees 1957-I L.L.J. 226. In p. 234 of the judgment, their lordships observed:

Ashimananda Banerjee was arrested by the Government under the West Bengal Security Act and detained in jail from 25 January 1949 to 5 April 1951. The company terminated his services on 22 April 1949. The tribunal made an order that he should be re-employed, and that is not now in question. But he further claims that he is entitled to be reinstated. The Appellate Tribunal has accepted that claim on the ground that he had been discharged without the company framing a charge or holding an enquiry, and that the rules of natural justice had been violated. We are unable to agree with this decision. The ground of discharge is the continued absence of the employee, and his inability to do work, and it is difficult to see what purpose would be served by a formal charge being delivered to him and what conceivable answer ha could give thereto. The order of the Appellate Tribunal is manifestly erroneous and must be set aside.

12. The facts of that case were very much Similar to the present case and the decision affords a complete answer to the argument raised by Sri Dabir complaining of breach of the rules relating to natural justice. A contention similar to one raised by Sri Dubey before me was considered by the Supreme Court in Indian Iron and Steel Co. v. Their Workmen 1958-I L.L.J. 260. The argument was repelled with the following observations:

It is true that the arrested men were not in a position to come to their work because they had been arrested by the police. This may be unfortunate for them; but it would be unjust to hold that in such circumstances the company must always give leave when an application for leave is made. If a large number of workmen are arrested by the authorities in charge of law and order by reason of their questionable activities in connexion with a labour dispute, as in this case, the work of the company will be paralysed if the company is forced to give leave to all of them for a more or less indefinite period. Such, a principle will not be just; nor will it restore harmony between labour and capital or ensure normal flow of production. It is immaterial whether the charges on which the workmen are arrested by the police are ultimately proved or not in a Court of law. The company must carry on its work and may find it impossible to do so if a large number of workmen are absent. Whether in such circumstances leave should be granted or not must be left to the discretion of the employer.

13. It is clear from these observations that the fact that the employees were absent on account of circumstances beyond their control does not, in any way, affect the right of the employer to terminate their services. It is also clear that leave cannot be claimed as a matter of right by the employees.

14. Accordingly, even if it is accepted that an application for grant of leave was made by the respondents to the appellant, such an application alone would not create any right in the respondents to get leave. It was entirely a matter for the discretion of the employer to grant or refuse leave.

15. Suffice it to observe that the respondents absented from duty for a long period and although they could not help this, the employer had the right to terminate their services. He exercised that right by passing an order on 1 March 1950 (p. 33/34 of the record of the trial Court). The only right which the respondents could have, under the circumstances, even if the dismissal was wrongful, was to claim damages. They were entitled to a reasonable notice terminating their services. If such notice is not given, pay in lieu of notice should be paid by the employer. As the respondents got pay for four months without doing any work, it cannot be said that the termination was without reasonable notice. They are not, therefore, entitled to any further relief.

16. In the result, all the three appeals are allowed. The decree of the lower appellate Court in each case is set aside and that of the trial Court dismissing the suit is restored. Under the circumstances of the case, I order that the costs shall be borne by the parties as incurred throughout. The cross-objections filed by the respondents are dismissed with costs to be borne as incurred.


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