1. All these five second appeals raise some common questions of law and have been argued together and will, therefore, be disposed of by a common judgment. In the course of the judgment we shall deal with the facts of each appeal separately. In all the appeals the respondent is the municipality of Patan (hereinafter referred to as the municipality). The municipality was the defendant in the five suits from which these five appeals arise. The plaintiffs in those five suits (who are the appellants in the five appeals) were the former employees of the municipality whose services were terminated by the municipality by resolutions of different dates to which we shall refer in due course. In each of those suits the plaintiff claimed a declaration that the resolution of the municipality terminating his services was illegal, void and of no effect and that it did not affect the continuance of his service and his service benefits and prayed for a perpetual injunction against the municipality restraining it from enforcing the said resolution. In all the suits except the one from which Appeal No. 662 of 1960 arises the orders passed by the municipality terminating services of the employees concerned were of dismissal. In the suit from which Appeal No. 662 of 1960 arises the order was one of discharge. The orders of dismissal were under rule 97 of the rules in force in respect of the municipality in relation to the conditions of service of its employees and the controversy in the trial Court centered on the questions whether the conditions of that rule had been complied with before the order of dismissal was made, and if not, whether that rule was mandatory or directory and whether the plaintiff was entitled to a declaration and injunction as sought or his remedy was for damages for wrongful dismissal, a claim which was not made. The lower appellate Court held on facts in each case that the conditions of rule 97 had not been satisfied before the resolution of dismissal was passed in the four suits in which the orders were of dismissal; but that the rule was directory and the only remedy available to the plaintiff was a suit for damages. The declaration for continuance in service and injunction were therefore refused. Against that decision the plaintiffs in all the suits have come in appeal.
2. In order to appreciate the submissions of counsel, to which we shall refer presently, it would be convenient at the outset to set out in brief the relevant legislative history relating to the law applicable to this municipality. Patan was a part of the former Baroda State. In that State two municipal Acts were in force - the Baroda A Class Municipalities Act and the Baroda B Class Municipalities Act. It is undisputed that the Patan municipality was governed by the Baroda A Class Municipalities Act which was Act 1 of Samvat Year 1962 and which appears to have come into force on 21 December, 1905. The said Baroda A Class Municipalities Act substantially contains the same provisions as are contained in the Bombay District Municipal Act, 1901, to which reference will be made later. Section 46 of the said Baroda Act (which corresponds with S. 46 of the corresponding Bombay Act) empowered the municipality to make rules inter alia for determining the executive functions to be performed by the president and vice-president, etc.; the delegation of any of the powers or duties and for determining the staff of officers and servants to be employed by the municipality and their respective designations, duties, salaries, etc.; the powers and duties delegated to them; the mode of punishing an officer or servant and delegation of powers to officers to fine, reduce, suspend and remove another officer or servant. In accordance with these powers the municipality had made rules. We are concerned with the rules framed with reference to the above subjects which fall under Cls. (kha), (ga), (gna) and (cha) of Sub-section (1) of S. 46. These rules, which for the sake of convenience may be referred to hereinafter as the rules, fall into nine chapters with a schedule attached. Of these rules we are particularly concerned with the rules contained in Chap. VIII wherein the important rules 95 and 97 are contained. We shall come to the contents of the relevant rules presently, but to contents of the narration of legislative history, it appears that the Baroda A Class Municipalities Act 1 of Samvat Year 1961 was repealed and re-enacted as Baroda A Class Municipalities Act 19 of 1949. The Patan Municipality Rules, it is conceded, continued in force under the new Act. The Ruler of Baroda ceded to the Government of India on 1 May, 1949, full and exclusive authority, jurisdiction and powers for and in relation to the Government of Baroda State. Thereafter, an order was made under S. 4 of the Extra Provincial Jurisdiction Act, 1947, called the 'Baroda State Application of Laws Order, 1949.' This order came into force on 30 July, 1949. Under Clause (1) of Para. 3 of that order, read with Sch. I, the Bombay District Municipal Act, 1901, and the Bombay Municipal Boroughs Act, 1925, as in force in the Province of Bombay immediately before coming into force of that order, were extended to and were to be in force in the Baroda State subject to any amendments to which the said enactments were for the time being generally subject in the Province of Bombay. Therefore, by this order the said Bombay Acts were extended to and came into force in the Baroda State. Under Clause (1)(c) of Para. 5 of that order, the enactments in force in the Baroda State corresponding to the enactments in force in the Province of Bombay and extended to the Baroda State under Para. 3 were repealed. The enactments corresponding to the Bombay District Municipal Act, 1901, and the Bombay Municipal Boroughs Act, 1925, were the Baroda A Class Municipalities Act and the Baroda B Class Municipalities Act, [See Kadi Municipality v. New Chhotalal Mills Company (I.L.R. 6 Guj. 145).] Those Acts therefore were repealed. Paragraph 6 of the order provided for continuance of the officers and authority constituted under the repealed Acts. Thus, as from 30 July, 1949 the District Municipal Act, 1901, took the place of the Baroda A Class Municipalities Act with respect to the Patan municipality. Thereafter, when the territory which formed part of the former Baroda State was merged into the then Province of Bombay and became part of that province, the Bombay Merged States (Laws) Ordinance, 1949, was enacted which was later replaced by the Bombay Merged States (Laws) Act, 1950 (Bombay 4 of 1950). This Act contained provisions similar to the provisions contained in the Baroda State Application of Laws Order, 1949, in respect of extension of laws. The Bombay District Municipal Act, 1901, was one of the Acts extended to the Baroda territories and in its application to those territories certain amendments were made in the Act of which only one is material for the purpose of this case. That was the insertion of S. 180A. Under that section all rules made, issued or sanctioned by or in respect of any of the municipalities whether constituted under the A Class Municipalities Act (Baroda 12 of 1949) or the B Class Municipalities Act (Baroda 14 of 1949) of the former Baroda State as were in force immediately before 30 day of July, 1949 under the said Baroda Acts, shall, in so far as they are consistent with the provisions of the Bombay District Municipal Act, 1901, be deemed to have been made, issued or sanctioned by or in respect of the said municipalities under the appropriate provisions of the said Bombay Act on the said date and continue in force until altered, repealed or amended by a competent authority. Thus, the rules, which we have earlier referred to, have continued in force in respect of Patan municipality as made under the District Municipal Act, 1901, notwithstanding the repeal of the Baroda A Class Municipalities Act. This position is conceded.
3. The relevant rules as we have stated are in Chap. VIII of the rules. Rule 93 in that chapter lays down the powers of different authorities to make appointment of municipal officers and servants. The power to appoint the chief officer lies with the general body subject to the sanction of the Government. The power to appoint the secretary, the overseer and other officers and servants drawing a pay above Rs. 40 is with the general body. The power to appoint servants drawing pay of Rs. 20 and above but not exceeding Rs. 40 is with the president and in his absence with the vice-president. In respect of the servants drawing a pay under Rs. 20 the power is with the chief officer and in his absence with the chairman of the concerned committee. We are not concerned with rule 94. Then rule 95 lays down different classes of punishments which can be inflicted and by whom. It is in Gujarati, as are all the rules. Translated it reads as under :
'95. Power to punish. - The officer or servant who has power to appoint an officer or servant has, on the principles embodied in the relevant rules relating to Government servants, the power
(A) to impose fine,
(B) to reduce from post,
(C) to suspend,
(D) to discharge from service,
(E) to dismiss.
In accordance with the said rules it is to be understood that unless otherwise directed in this rule,
(F) the powers of vahivatdar are vested in
(1) the chief officer, and
(2) the president of the respective sub-committee, and
(G) the Deputy Collector, in the vice-president,
(H) the Collector, in the president, and
(1) Sur Suba (i.e., Commissioner) and,
(2) the (officers) other than him in the general body.
They should use the said powers in accordance with the respective rules.
No resolution contrary to the principles laid down under the rule shall come into force without the sanction of the Government.'
4. Rule 96 concerns the power of suspension and rule 97 which has been the subject of considerable argument befores reads as under :
'97. Delinquent be given opportunity to defend and then resolution be made in writing :
(1) (a) No officer or
should be dismissed without giving him reasonable opportunity of declaring what he has to say in his defence.
(2) The order of
(a) every dismissal or
should be in writing and therein the charge for the offence for which the delinquent is dismissed and the facts of the case put forward (by him) in defence and the grounds of the order should be clearly stated.'
5. Rule 95, therefore, regulates the power of punishment and rule 97 provides the procedure to be followed when the punishment is by way of dismissal.
6. The submissions made by counsel may now be set out. On behalf of appellants Sri Vakil substantially argued the case and those arguments were adopted by Sri Parghi and Sri Abhichandani. On behalf of the respondent the case was presented by Sri Bhatt. Sri Vakil argued that rule 97 when properly construed requires that the servants concerned against whom action of dismissal is proposed to be taken should be informed of the specific charges against him, called upon to tender an explanation of those charges, permitted to cross-examine witnesses and be heard and should also be told what the proposed punishment is so as to enable him to make a representation against that punishment and unless these requirements are fully satisfied, sub-rule (1) of rule 97 cannot be said to have been complied with. In short, his submission is that rule 97 contemplated an enquiry of the nature intended by rule 55 of the Civil Services (Classification, Control and Appeal) Rules, a view which the lower appellate Court has taken in some of the cases. Then again under sub-rule (2) of rule 97 the order of dismissal has to be in writing, has to set out the offence for which the servant was being dismissed, the facts relating thereto and the defence of the said servant and has also to set out the grounds of the order clearly. In the cases under consideration, according to him, these requirements of sub-rules (1) and (2) have not been satisfied, and both the sub-rules have been violated. The next stage of his argument is that the non-observance of these requirements of the rule renders the order void and ineffective, firstly because that is what rule 95 lays down and secondly at any rate because rule 97 is mandatory and therefore non-compliance with its provisions must necessarily make the order, purported to have been passed under it, null and void. He argues that the ruling of the Bombay High Court in Broach Municipality v. Bhadriklal [53 Bom. L.R. 282] which held that rule 182 of the Broach municipality, which was similarly worded as rule 97 in the present case, was directory and on which the lower appellate Court has relied, proceeds on wrong premises. The High Court has proceeded on the premise that the municipal service is held at pleasure and the further premise that the rules framed under the District Municipal Act, 1901, were administrative in nature. According to him, these two propositions are not well-founded. If rule 97 is examined in that light and its language and object are considered, the only reasonable conclusion, he argues, is that it is mandatory an if that is so, the necessary result of its non-compliance is that the order of dismissal is null and void. The further stage of his argument is that if the order is null and void, the only result of it is that there was no termination of service and the appellant must therefore, be deemed to have continued in service as if no order was passed and the Court must of necessity give him not only the declaration that the order was void and ineffective but also the further declaration that he continues in service and an injunction restraining the municipality from denying him the benefit of continuous service. He submits that the lower Court was in error in holding that the only relief available to the appellant was for damages for wrongful dismissal and in throwing out the suit on that ground. In addition to these legal submissions, one more submission was made by Sri Vakil in Appeal No. 307 of 1960 and that was that the order of dismissal in that case, having been passed with retrospective effect, was even otherwise ineffective except from the date on which it is passed.
7. Sri Bhatt, on the other hand, submitted on behalf of the respondent that the reading of rule 97 as if it lays down the same requirements as are laid down by rule 55 of the Civil Services (Classification, Control and Appeal) Rules was not warranted by the terms of rule 97. All that rule required was that the servant concerned should be given an opportunity to give his say and that the said opportunity should be reasonable. There is no requirement of framing of charges, or recording of evidence in the presence of the servant or of the servant being given an opportunity of personal hearing nor is there any requirement that the servant should be specifically told that he is proposed to be dismissed. He argues that the requirements of rule 97 have been satisfied in all the four cases where there are orders of dismissal. But even if in any particular case they have not been satisfied to the letter, the order does not, for that reason, become void because rule 97, according to him, is directory. He argues that rule 95 does not control rule 97 but is a self-contained rule dealing with a separate subject, namely, what are the authorities who are entitled to impose punishment and what rules are applicable in respect of powers of proposed punishment. That rule, according to him, has nothing to do with the procedure to be followed in respect of the inquiry to be held by the competent authority before the punishment is inflicted. For that rule 97, he submits, is self-contained. He next argued that even if it is held that sub-rule (1) of rule 97 which is the material part of that rule is mandatory, even then having regard to the nature of the service in this case, the plaintiff is not entitled to any such declaration and injunction as prayed for but his only remedy is by way of suit for damages for wrongful dismissal. His arguments is that the plaintiff has no right to the post and no fixity of tenure and no declaration or injunction could be given as prayed for which is not founded on any such right and in any case the declaration being a discretionary relief, on the facts of this case, the discretion should not be exercised in plaintiff's favour. These are the only submissions requiring to be considered.
8. The principal questions which we have, therefore, to consider are :
(1) what are the requirements of rule 97 as regards the mode or manner of enquiry
(2) Whether rule 95 provides for the consequences of the breach of rule 97
(3) If not, whether rule 97 is mandatory or directory
(4) Whether the non-compliance with the provisions of that rule entitles an aggrieved servant to a relief for declaration that he continued in service and for a perpetual injunction against the municipality not to deny him the benefits of the service
(5) Whether on the facts of each case there has been non-compliance with the provisions of rule 97
9. Rule 97 has been earlier set out. The material portion of rule 55 of the Civil Services (Classification, Control and Appeal) Rules, on which the lower appellate Court has relied and the requirements of which are sought to be imported by Sri Vakil into rule 97, reads as under :
'55. Without prejudice to the provisions of the Public Servants Inquiries Act, 1850, no order of dismissal, removal or reduction shall be passed on a member of the service (other than an order based on facts which had led to his conviction in a criminal Court, or by a Court-martial) unless he has been informed in writing of the grounds on which it is proposed to take action, and has been afforded an adequate opportunity of defending himself. The grounds on which it is proposed to take action shall be reduced to the form of a definite charge or charges, which shall be communicated to the person charged together with a statement of the allegations on which each charge is based and of any other circumstances which it is proposed to take into consideration in passing orders on the case. He shall be required, within a reasonable time, to put in a written statement of his defence and to state whether he desires to be heard in person. If he so desires or if the authority concerned so directs, an oral inquiry shall be made. At that inquiry oral evidence shall be heard as to such of the allegations as are not admitted, and the person charged shall be entitled to cross-examine the witnesses, to give evidence in person and to have such witnesses called, as he may wish, provided that the officer conducting the inquiry, may, for special and sufficient reason to be recorded in writing, refuse to call a witness. The proceedings shall contain a sufficient record of the evidence and a statement of the findings and the grounds thereof.'
10. It will be noticed that the said rule 55 in terms requires that before any order of dismissal, removal or reduction is passed on the Government servant concerned, he shall be communicated in writing the grounds of the proposed action in the form of definite charges together with the statement of allegations on which the charges are based, required to put in his written statement of defence within reasonable time, entitled to have an oral inquiry held in his presence and to cross-examine witnesses as also to have his own witnesses examined. In these detailed provisions these are three essentials, the furnishing of a detailed chargesheet, the filing of a written statement in defence and oral hearing with a right to cross-examine. In sub-rule (1) of rule 97 which is the material part of that rule there is no mention of the first and third of these requirements; only the second requirement, it will be noticed, is, in substance, embodied.
11. Sri Vakil's argument is that in holding an inquiry under rule 97, the tribunal must follow the procedure very similar to the procedure laid down in the aforesaid rule 55, that is, it must give a chargesheet with a statement of allegations, it must examine witnesses in the presence of the person charged and they should be allowed to be cross-examined, the person charged should be permitted to lead oral evidence and should be orally heard and he should be clearly told what the proposed punishment is. According to Sri Vakil these obligations are implicit in the wording of rule 97 itself and if they are not, then they are implicit in the rules of natural justice which every tribunal acting quasi-judicially must follow. He argues that in so far as rule 97 does not provide for the various stages of inquiry, the tribunal is under an obligation to hold an inquiry in that manner, because of rules of natural justice. Now, Sri Vakil is right when he says that the authority acting under sub-rule (1) of rule 97 acts quasi-judicially. He is also right when he says the authority so acting must observe rules of natural justice. But he is not right in saying that unless the inquiry is held in the manner submitted by him the rules of natural justice would be violated. There are no absolute rules of natural justice. There scope and content must vary according to the nature and constitution of the statutory body acting as a tribunal. We shall examine later the relationship between a municipal employee and his employer, the municipality, and shall have occasion to point out that the employee has no statutory right to a post in the municipality and the relationship between the two except to the extent provided for in the statutory rules in contractual. When considering the content of the principles of natural justice to be observed by a tribunal constituted to determine the question of relationship between the two, this aspect cannot be overlooked. When therefore rule 97 does not provide for a charge-sheet or for a personal hearing, it does not follow that it has failed to provide for an inquiry according to the rules of natural justice, and that these requirements must be imported into it. When the statutory rule, as rule 97 is, embodies the procedure to be followed by the tribunal acting under it, then unless that rule is challenged and can be held ultra vires, that rule must govern the procedure to be followed in the matter covered by it and the argument that the body acting under it must follow some general rules of natural justice cannot prevail. Nor is there any authority for the proposition that there are any prescribed rules of natural justice governing all cases.
12. In N. P. T. Company, Ltd. v. N. S. T. Company, Ltd. : 1SCR98 , the question raised before the Supreme Court concerned the scope and nature of hearing before the authority deciding under S. 64 of the Motor Vehicles Act, 1939, an appeal from the decision of the Regional Transport Authority. The Supreme Court pointed out that the tribunal was not a Court of justice but a statutory body functioning in a quasi-judicial way. A tribunal acting quasi-judicially must no doubt act honestly and impartially and in the absence of provisions as to how he must proceed the law will imply no more than that substantial requirements of justice shall not be violated. These requirements do not postulate the method of a Court of justice. He is not a judge in the proper sense but he must give the parties an opportunity of being heard before him and stating their case. When, however, the statute under which the tribunal is constituted makes provisions whether in the statute or under the rules made thereunder as to manner of hearing, those provisions are the only provisions that need be followed. Indeed the tribunal is bound to follow those requirements. In this connexion the Supreme Court referred to the case the Rex v. Local Government Board Ex parte Arlidge [(1913) 1 K.B. 463], as it was decided first by the High Court, then by the Court of Appeal [(1914) 1 K.B. 160] and finally by the House of Lords [1915 A.C. 120]. The question was whether the local board while considering the report of the public local inquiry under the provisions of the statute was also bound to hear the appellant before dismissing his appeal. The trial Court repelled the argument that the appellant had a right to be heard and to know the contents of the public inquiry report. The ground given was that the procedure indicated by the rules framed under the statute had been followed and there was no further obligation on the Board to hear the appellant because there was no indication in the statute to that effect. The Court of Appeal by a majority took a contrary view stating that the Act and the rules except for certain matters were silent as to the procedure and that in the absence of such specific provisions, the non-disclosure of the inspection report was contrary to the principles of natural justice on which English law was based. It further held that the appellant before the Board was entitled to a hearing. Hamilton, L.J., in a dissenting judgment pointed out that it cannot be assumed that the report of the public inquiry was required by the legislature to be communicated to those interested when it does not say so. The House of Lords unanimously adopted the opinion of Hamilton, L.J. The Supreme Court summarizes the position in law as under :
'The question whether the rules of natural justice have been observed in a particular case must itself be judged in the light of the constitution of the statutory body which has to function in accordance with the rules laid down by the legislature and in that sense the rules themselves must vary.'
13. At another place they say :
'The rules of natural justice have to be inferred from the nature of the tribunal, the scope of the inquiry and the statutory rules of procedure laid down by law for carrying out the objects of the statute.'
14. Therefore, an authority acting quasi-judicially must act in good faith and listen fairly to the parties before it, but as to the mode or manner of the inquiry to be made for that purpose, if there is statutory provision in that regard, the authority is obliged to conform to it and no more but if there is no such provision the authority must give a reasonable opportunity to the party concerned to place its case before the authority. What is reasonable opportunity must depend upon the facts of the case, and in particular upon the nature of the tribunal and the scope of the inquiry. The procedure of every tribunal cannot be the same. Sri Vakil invited our attention to the decision in Dock Labour Board, Calcutta v. Joffar Imam [1965 - II L.L.J. 112]. In that case a dock worker who was detained under the Preventive Detention Act was, on his release, departmentally proceeded against by the statutory authority constituted under the Dock Workers (Regulation of Employment) Act, 1948, on the ground that he had been detained. The worker was without further inquiry of hearing removed from the reserve pool register. Now Clause 36(3) of the scheme framed under that Act required that before any action is taken against a worker so registered the person concerned shall be given a reasonable opportunity of showing why the proposed action should not be taken against him. The Supreme Court held that the requirements of that regulation had not been observed and quashed the order. Sri Vakil relies on the following observations at p. 117 :
'. . . At this enquiry, reasonable opportunity should have been given to the respondents to show cause and before reaching its conclusion, the appellant was bound to lead evidence against the respondent, give them a reasonable chance to test the said defence, and then come to a decision of its own. Such an enquiry is prescribed by the requirements of natural justice and an obligation to hold such an enquiry is also imposed on the appellant by Clause 36(3) of the scheme of 1951 and Clause 45(6) of the scheme of 1956. . .'
15. Sri Vakil argues that the above requirements are, therefore, the necessary requirements of natural justice. We do not read the decision to lay down any such broad proposition. The Court was considering the scope of the expression 'opportunity to show cause why the proposed action should not be taken against him.' The Court was at an earlier place, while referring to a right of a citizen to a fair and proper trial according to law, before his liberty is lost, stated that -
'a legal or proper trial according to law inevitably means, inter alia, a trial held in accordance with the statutory provisions or in their absence, consistently with principles of natural justice.'
16. Therefore, the observations on which Sri Vakil relies are related to the facts of that case and the provisions governing the inquiry. Sri Vakil also invited our attention to the observations of the Kerala High Court in M. Appukutty v. Sales Tax Officer : AIR1966Ker55 . There the question was whether an assessment made by a Sales Tax Officer was liable to be set aside on the ground that he had not observed principles of natural justice. The Sales Tax Officer had given notice to show cause and given the assessee a chance to explain, but it was contended that thereafter in deciding the matter the Sales Tax Officer had proceeded capriciously. The Court said that principles of natural justice demand that there should be a fair determination of the question by quasi-judicial authorities and this can be achieved by deciding the question in a quasi-judicial manner, which means not merely making known the proposal and giving a chance to explain but also a judicial consideration of the representation and the materials. These observations which are relied on by Sri Vakil relate to a fair and impartial consideration by a quasi-judicial authority of the matter required to be decided by it. They deal with a different aspect of the question.
17. Therefore, in examining the cases under these appeals all that we have to consider in so far as sub-rule (1) of rule 97 is concerned is whether these servants had been opportunity of declaring what they had to say in defence and whether that opportunity was reasonable. The opportunity may not be reasonable if the person concerned is not informed of the charge or default in respect of which the enquiry is to be held and of the material which went to substantiate that charge or default but it is not necessary that he should be given a chargesheet accompanied by a statement of allegations. Similarly, the opportunity may not be reasonable if sufficient time was not given to the servant concerned for declaring what he had to say in his defence, but it does not case to be reasonable because no personal hearing is given or is required to be given. A reasonable opportunity to show cause confers a right to state a case. Unless there is a statutory obligation otherwise, this right does not necessarily include a right or opportunity to be heard orally. Therefore, Sri Vakil's submission that in an inquiry under rule 97 the domestic tribunal must substantially follow the procedure of a chargesheet, recording of evidence in presence of the delinquent and a personal hearing cannot be accepted. What the tribunal is required to do under rule 97 is to give a reasonable opportunity to the servant concerned of declaring what he has to say in his defence. The content of that reasonable opportunity and some of the circumstances which would amount to a denial of such opportunity have been earlier indicated. There may be other circumstances peculiar to each case. In each case, whether the opportunity given to the servant to declare what he has to say has or has not been reasonable is a question of fact. There is no standard of what is reasonable in a given case. Each case will, therefore, have to be examined in the light of its facts. But before we do so in respect of these cases it would be convenient to dispose of the other point of law raised by Sri Vakil.
18. The next question raised is the legal effect of the non-compliance with the provisions of rule 97. Sri Vakil's first arguments is that the effect of the non-compliance is provided for in rule 95 and that effect is that the resolution would not come into force without the sanction of the Government. If this argument is accepted, the question whether rule 97 is mandatory or directory would not arise for consideration. It is, therefore, necessary to turn to rule 95. The first part of that rule sets out the broad proposition that the appointing authority has the power to punish. This power is to be exercised on the principles embodied in the relevant rules relating to Government servants. In short, the first part relates to conferment of power. As the first part makes reference to the relevant rules relating to Government servants, the second part indicates the municipal authority which would correspond to competent Government authorities, such as the Deputy Collector, Collector, Commissioner and others. The second part, therefore, relates to equation of authority consequent on the standard laid down in the first part. The third part which says,
'they should use the said powers in accordance with the respective rules,'
relates to the exercise of the power by the competent authorities set out in the second part. The power is to be exercised in accordance with the respective rules, that is to say, if there are limitations set out in the Government servants rules or the municipal rules on the authorities specified, those limitations must be adhered to. There may be, for example, limitations on the quantum of fine or other punishments or the nature of punishments which a particular authority may inflict. There may be limitation in respect of classes of servants on whom punishments can be inflicted by a particular authority. Those limitations would prevail. The last part which says that
'no resolution contrary to the principles laid down under the rule shall come into force without the sanction of the Government,'
Provides for validating by the Government of action which has been contrary to the principles laid down under the rule. There is no difficulty about the first three parts. It is in respect of the provision in the last part that Sri Vakil has addressed us at length. He argued that this part clearly lays down that the resolution which is contrary to the principles embodies under the rules will not be effective without the sanction of the Government and, therefore, a resolution of dismissal which is contrary to rule 97(1) will not be effective in the absence of validation by Government. He wants to read the words [in Gujarati 'Niyamthi Karel Dhoran Viruddha'] as meaning 'contrary to the principles laid down under the rules,' that is to say, he wants to read the word [in Gujarati 'Niyam'] as equivalent to rules. Sri Bhatt's reply is that the word [in Gujarati 'Niyam'] here is rule 95 and not all the rules. Sri Bhatt's construction, in our view, is more consistent with the language and object of the provision and is also consistent with the context. In rule 95 the word [in Gujarati 'Niyam'] has been used at several places. In the first part of the rule the relevant words are [in Gujarati 'Sambandhi Niyam na Dhorane'], in the second part in Gujarati 'Te Niyam ne Anvsarine'] and in Gujarati 'Aa Niyam na'] and in the third part [in Gujarati 'Te Niyamo ne']. So far as the last part is concerned, the only word used is [in Gujarati 'Niyam']. In the absence of any indication as in the other parts, we have to consider the expression in the light of context. What the provision deals with is the situation where a resolution is contrary to the principles laid down by the relevant rules. The provision does not cover the general situation where the resolution is contrary to any rule. Now rule 97 does not deal with principles. It deals with procedure. The rule which deals with principles in respect of the subject is rule 95 itself; the principles being firstly the principle that the appointing authority is the punishing authority, secondly the principle of equation and thirdly the limitations relating to the exercise of power of punishment. If there is any resolution contrary to these principles, if, for example, the punishment is inflicted by an authority which is not the appointing authority or the punishments is inflicted by an authority which through the appointing authority inflicts a punishments in excess of the limitations laid down in the respective rules or the punishment is inflicted by an authority which does not correspond to the authority in accordance with the equation laid down in the rule, such an order would be contrary to the principles and obviously it could be only the Government as the supreme authority, which could validate the action under such an order, because so far as the Government is concerned the legislation does not intend to place any limitation on its authority or its competency in respect of these different aspects of the exercise of power. This construction gets support from rules 17 and 18. Rule 17 provides for sanction of leave and rule 18 for promotion. They lay down the principles relating to leave and promotion, the authorities entitled to sanction the same and they provide for equation of authorities on the same basis as is provides in rule 95. The concluding part of each of these rules is in words identical with the concluding part of rule 95. If the expression [word in Gujarati] in rule 95 was meant to cover all the rules, an identical provision in rules 17 and 18 would not be necessary. Therefore, on the language and content of the last part of rule 95 and in the light of the context, the reasonable constriction is that the tharay which it refers to is a tharay which is contrary to the principles embodied in rule 95 itself. Sri Vakil's submission, therefore, that by reason of that provision in the last part of rule 95 any action contrary to sub-rule (1) of rule 97 is rendered ineffective, cannot be accepted.
19. It is then necessary to consider whether rule 97 is mandatory or directory for that would go to determine the consequences of its non-compliance. One aspect of the matter may at the outset be cleared. In the lower appellate Court it was urged that the rule was administrative. That argument was accepted by the Court and that was one reason why it was held to be directory. The argument was that as the rules can be charged from time to time by the rule-making authority, those rules have no greater force than executive directions and their non-compliance must be treated in that light. That is not the correct position of law. If the rules have been made by the competent authority in exercise of the power conferred by an Act and are consistent with the provisions of the Act under which they are made, they have in law the same force as the provisions of the Act itself. In State of Uttar Pradesh v. Babu Ram : 1961CriLJ773 , the Supreme Court held that the rules made under a statute must be treated for all purposes of construction or obligation exactly as if they were in the Act and are to be of the same effect as if contained in the Act and are to be judicially noticed for all purposes of construction or obligation. That being so, such statutory rules have the same forces as law. Now the question whether a particular statutory rule is mandatory or directory has importance with reference to the consequences of its non-compliance. If the consequences of non-compliance of the rule under consideration are legislatively provided for, there is no difficulty. If they are not so provided for, they turn on the question whether the rule was mandatory or obligatory and this has to be determined, as in the case of any legislative provision, by discovering the legislative intent. In Banwarilal v. State of Bihar : (1961)IILLJ140SC it is stated :
'As has been recognized again and again by the Courts, no general rule can be laid down for deciding whether any particular provision in a statute is mandatory, meaning thereby that non-observance thereof involves the consequence of invalidity or only directory, i.e., a direction the non-observance of which does not entail the consequence of invalidity, whatever other consequences may occur. But in each case the Court has to decide the legislative intent.'
20. These observation which relate to the construction of the provision of a statute, namely, Ss. 12 and 59 of the Mines Act, 1952, would apply equally to the construction of the provisions of statutory rules which have the same force as the provisions of the statute under which they are made. The Supreme Court then proceeds to indicate how the legislative intent is to be ascertained. Their lordships say :
'Did the legislature intend in making the statutory provisions that non-observance of this would entail invalidity or did it not To decide this we have to consider not only the actual words used but the scheme of the statute, the intended benefit to public of what is enjoined by the provisions and the material danger to the public by the contravention of the same.'
21. Therefore, the legislative intent is to be gathered by an examination of all the relevant circumstances, namely, the language used, the scheme of the legislation, the benefit intended by the observance of the rules and the risks arising from non-compliance with its provisions. One other circumstance which is relevant in discovering the legislative intent is whether the provision under consideration relates to performances of duty or whether it relates to the exercise of privilege or power. A strict compliance with the conditions of the exercise of privilege or power may be reasonably assumed to be intended, but not so with the manner of performance of a duty particularly when public inconvenience would result in enforcing strict compliance. As stated by Maxwell in his Interpretation of Statutes, 11th Edn., at p. 364 :
'A strong line of distinction may be drawn between cases where the prescriptions of the Act affect the performance of a duty and where they to a privilege or power. Where powers, rights or immunities are granted with a direction that certain regulations, formalities or conditions shall be complied with, it seems neither unjust nor inconvenient to exact a rigorous observance of them as essential to the acquisition of the right or authority conferred, and it is, therefore, probable that such was the intention of the legislature. But when a public duty is imposed and the statute requires that it shall be performed in a certain manner, or within a certain time, or under other specified conditions, such prescriptions may well be regarded as intended to be directory only in cases when injustice or inconvenience to other who have no control over those exercising the duty would result if such requirements were essential and imperative.'
22. We may examine rule 97 in the light of these considerations.
23. Now rule 97 consists of two sub-rules. The language and purport of each of which being different, it will be convenient to consider each sub-rule separately. Sub-rule (1) is worded in prohibitory language. It prohibits the dismissal without giving the officer or servant concerned a reasonable opportunity of declaring what he has to say in his defence. As observed by the Privy Council in the case of High Commissioner for India and Pakistan v. Lall [50 Bom. L.R. 649] if the language of a provision is prohibitory in form, it is indicative of it being mandatory in character. The content of sub-rule (1) supports this construction. The sub-rule relates to the severest punishment, namely, dismissal. Any action of dismissal may have, apart from termination of service, other serious consequences on the servant against whom that action is taken. He is likely to lose the benefits of service which may have accrued to him such as benefit of leave or gratuity or pension, if any. There would be a stigma attached to him. This is another consideration bearing on the question of intention. The object of the rule is to afford protection to the municipal servant against whom action of dismissal is to be taken and non-observance of the rule would defeat that object. Lastly, the rule relates to the exercise of power, namely, the power of termination of service by dismissal. This power can be exercised by an authority subordinate to the municipality, namely, the president, vice-president, chief officer, the chairman of the concerned committee. It could not be the legislative intent to permit subordinate authorities to exercise such an important power without following the procedure laid down. Therefore, on an examination of sub-rule (1) as a whole in the light of the tests laid down by authorities, that sub-rule must be held to be mandatory. The same cannot be said of sub-rule (2) of rule 97. That sub-rule requires every order of dismissal or confirmation to be made in a particular manner, namely, that it should be in writing and it should contain the substance of the charge, the defence and the grounds of the order. Such a provision would, on the above tests, be obviously directory. The language of sub-rule (2) is in affirmative and not in prohibitory form. The sub-rule deals merely with the form of the order of dismissal or confirmation. The object of the sub-rule appears to be to see that proper record is kept and for that purpose a duty is imposed on the authority recording the order passed as to the manner in which it shall be recorded. It is not in the circumstances possible to impute to this provision a legislative intent that its non-compliance shall invalidate the order purported to be recorded under it.
24. Sri Bhatt contends that even sub-rule (1) of rule 97 must also be held to be directory as the point is covered by a binding authority. The rule in question, he submits, must be deemed to have been made under the District Municipal Act, 1901, in view of S. 180A of that Act to which we have earlier referred. That part of his submission is correct because the rule is consistent with the provisions of the Act. He then proceeds to argue that an identical rule framed under that Act has been held to be directory by the Bombay High Court in Broach Municipality v. Bhadriklal Ambalal [53 Bom. L.R. 282]. It has been held by a Full Bench decision of this Court in State of Gujarat v. Gordhandas Keshavji [3 G.L.R. 269] that the decisions of the Bombay High Court given prior to 1 May, 1960 have the same binding force and effect as if they were decisions of the Gujarat High Court and therefore the decisions in Broach Municipality case [58 Bom. L.R. 282] (vide supra) should, Sri Bhatt says, be followed in respect of rule 97 and the effect of non-compliance with its provisions. Sri Vakil's submission is that the said Bombay ruling proceeds on certain premises which are not well-founded. He submits that the Full Bench decision of this Court is State of Gujarat v. Gordhandas Keshavji [3 G.L.R. 269] (vide supra) does not require this Court to follow the Bombay rulings as a matter of course but requires this Court to apply its mind and consider whether it can come to the same conclusion. It must make its best efforts to do so but if it cannot come to the same conclusion, it is open to this Court to reach its own conclusion.
25. In view of these submission it is necessary first to examine the facts in Broach Municipality case [53 Bom. L.R. 282] (vide supra) and the reasons underlying the decision in that case. The plaintiff in that suit was the chief officer of the Broach municipality. He joined the service of the Broach municipality in 1935 and was confirmed in 1936. There was considerable agitation against him in 1942 on account of his alleged interference in the municipal elections. On 16 December, 1942, at a special general meeting of the municipality, a resolution was passed terminating his services. No written notice was given to him and no explanation was called for. The plaintiff then filed this suit for a declaration that the resolution was illegal and ultra vires and was also null and void and against ordinary principals of natural justice, for a declaration that he continued in service as the chief officer of the municipality and for arrears of salary from 17 December, 1942 up to the date of the suit and further salary, in the alternative for reinstatement and in the alternative for damages for wrongful dismissal and for recovering the amount due to him under the provident fund. He also claimed Rs. 10,000 for lible. The suit was failed against the municipality who was dependent 1 and against the president who was dependent 2. Amongst the various contentions raised on behalf of the municipality were that the plaintiff was not holding office during good behaviour but only at pleasure and therefore was removable from office without any notice and without any cause being assigned and that therefore it was not incumbent upon the municipality before dismissing him to prove his misconduct or assign any reason for dismissal. It was further contained that even if the wrongful dismissal amounted to the infringement of some right, the only cause of action for the plaintiff, if at all, was to sue for damages for one month's salary. The Court in that case was concerned with the Bombay Municipal Boroughs Act, 1925. Section 58 of that Act is in terms similar to S. 46 of the Bombay District Municipal Act, 1901, and Clause (f) of the said S. 58 to Clause (e) of the said S. 46. Clauses (f) of the said S. 58 empowers the municipality to make rules, not inconsistent with the Act, determining subject to the limitations imposed by Ss. 33, 34(5) and 34A the mode and conditions of appointing, punishing, or dismissing any officer or servant. It appears that the Broach municipality before it became a municipal borough was a district municipality under the Bombay District Municipal Act, 1901, and under S. 46(1) of that Act it had framed the following rule 182 :
'(1) No officer or servant shall be dismissed without a reasonable opportunity being giving him of being heard in his defence. Any written defence tendered shall be recorded and a written order shall be passed therein.
(2) Every order of dismissal or confirming a dismissal shall be in writing and shall specify the charge or charges brought, the defence, and the reasons for the order.'
26. This rule had continued in force after the municipality became a borough municipality and it was this rule which came up for construction before the High Court. It will be noticed that the rule is in the same terms as rule 97 of the Patan Municipality Rules. In fact, sub-rule (1) of rule 97 of the Patan Municipality Rules is somewhat milder than the sub-rule (1) of the said rule 182, because under sub-rule (1) of rule 182, a reasonable opportunity is to be given to the servant concerned 'of being heard in his defence' but that is not so in sub-rule (1) of rule 97 under which the reasonable opportunity to be given is 'of declaring what he has to say in his defence.' The High Court first noticed S. 33 of the Municipal Boroughs Act, in Sub-section (2) of which it was provided.
'No chief officer shall be removed from office, reduced or suspended unless by the votes of at least two-thirds of the number of councilors : and no such officer shall be punishable with fine,'
27. and stated that the resolution in this case was passed by the necessary majority. The Court then noticed rule 189 of the rules which in substance provided that every municipal officer or servant was liable to be discharged by one month's notice. The rule had an explanation that the discharge did not include dismissal. The Court then went on to observe :
'This was not a case of discharge with one month's notice as contemplated by rule 189. It was a case of dismissal under the provisions of rule 182; and it is therefore necessary to consider whether the provisions of rule 182 had got to be complied with in order to validly remove the plaintiff from his office of chief officer. The municipality purported to dismiss the plaintiff from his position as chief officer and it was prima facie necessary for it, therefore, to comply with the provisions of rule 182.'
28. As these provisions had not been complied with, the question that was next considered was whether rule 182 was mandatory or whether it was merely directory and the non-compliance with its provisions would not vitiate the resolution. The Court held the rule to be directory. Now this decision which would be binding in view of the Full Bench ruling of this High Court in State of Gujarat v. Gordhandas [3 G.L.R. 269] (vide supra) would govern the interpretation of rule 97 which is practically in the same terms as rule 182 which was under consideration in that case. But Sri Vakil contends that it was not binding because it proceeds on premises which are not well-founded.
29. Now the main ground on which the Bombay High Court in the Broach Municipality case [58 Bom L.R. 282] (vide supra) held the rule it was considering to be to be directory was that the rule in question being a part of rules alterable from time to time is merely an administrative rule and is in marked contrast to the statutory provisions of the type contained in Ss. 33(2) and 34A of the Bombay Municipal Boroughs Act. The Court relied on the decision of the Privy Council in R. Venkata Rao v. Secretary of State [39 Bom. L.R. 699] and High Commissioner for India and Pakistan v. Lall [50 Bom. L.R. 649] (vide supra). Sri Vakil contends that the learned Judges who decide the Broach Municipality case (vide supra) have read into the two Privy Council ruling more than what was decided. In R. Venkata Rao case [39 Bom. L.R. 699] (vide supra) the Privy Council was considering the validity of a dismissal made without complying with the provisions of a rule made under S. 96B of the Government of India Act, 1915. The rule was in terms similar to rule 55, of the Civil Service (Classification, Control and Appeal) Rules. The Privy Council held the rules in that regards to be merely administrative directions given by the Crown to the administrative authorities for their guidance. The reason for the decision was that S. 96B in express terms stated that the office is held during pleasure and Sub-section (5) of that section expressly confirmed the supreme authority of the Secretary of State in Council over the civil service. No rules made thereunder could therefore import a kind of limited or special employment during pleasure with an added contractual term that the rules are to be observed. In the case of High Commissioner for India and Pakistan v. Lall [50 Bom. L.R. 649] (vide supra) the Privy Council was considering S. 240 of the Government of India Act, 1935. Their lordships noticed that the protection against removal or dismissal except by holding an inquiry in the manner provided, which was provided for in the rules made under S. 96B of the Government of India Act, 1915, was now placed in S. 240 itself of the Government of India Act, 1935. It was no longer resting on rules alterable from time to time but was mandatory, and necessarily qualified the right of the Crown recognized in Sub-section (1) of S. 240. These two Privy Council decisions therefore relate to rules concerning Government servants whose tender was governed by the Governments of India Act, 1915 or 1935, as the case may be. Under the former the tenure was entirely at pleasure and under the latter though the tenure was at pleasure, that pleasure could in case of removal or dismissal be exercised in the manner laid down by the Act. The two decisions do not support the proposition that all statutory rules relating to conditions of service must be treated as administrative and are meant only for guidance of officers acting under them. In State of Uttar Pradesh v. Babu Ram : 1961CriLJ773 their lordships of the Supreme Court after discussing the Privy Council cases above referred to have stated :
'These decisions and the observations made therein could not be understood to mark a radical departure from the fundamental principle of construction that rules made under a statute must be treated as exactly as if they were in the Act and are of the same effect as if contained in the Act. There is another principle equally fundamental to the rules of construction, namely, that the rules shall be consistent with the provisions of the Act. The decisions of the Judicial Committee on the provisions of the earlier Constitution Acts can be sustained on the ground that the rules made in exercise of power conferred under the Acts cannot override or modify the tenure at pleasure provided by S. 96B or 240 of the said Acts, as the case may be. Therefore, when the paramountcy of the doctrine was conceded or declared by the statute, there might have been justification for sustaining the rules made under that statute in derogation thereof on the ground that they were only administrative directions, for otherwise the rules would have to be struck down as inconsistent with the Act.'
30. The Supreme Court has thus explained the decisions of the Privy Council which form the basis of the decision of the Bombay High Court in Broach Municipality case [53 Bom. L.R. 282] (vide supra). It is not therefore possible to hold that a rule made under a statute being changeable from time to time is administrative in nature. In fact the Bombay High Court itself had, in an earlier decision, expressed a different view, for in Gokak Municipality v. Rajaram Shridhar [42 Bom. L.R. 886]. Broomfield, J., has observed :
'If you have to look to the special law to ascertain what the conditions of service are, it is difficult to see why a distinction should be made between a statutory provision and a provision made by a statutory rule.'
31. Therefore, the ruling in Broach Municipality case [53 Bom. L.R. 282] (vide supra) is not now determinative of the question and will not govern the construction of rule 97 on the question whether or not that rule is directory.
32. Sri Bhatt has advanced an alternative argument, namely, that a municipal employee holds office entirely at the pleasure of the municipality, that being an implied term of his service, and if the Act under which the municipality is constituted does not expressly negative that term, any rule made under the Act which is inconsistent with that term would have no binding effect. The question of tenure of a municipal employee is one of some importance, for, apart from its bearing in the binding effect of rule 97 hear, it bears on the further and more important question as to what relief is the employee entitled to if the termination of his employment is not in accordance with law. Sri Vakil's submission is that once it is held that rule 97 is violated and that it is mandatory, the Court must order that he was continued in service notwithstanding the order of dismissal. Sri Bhatt submits that the dismissed employee would at best be entitled to damages for wrongful termination of service. In respect of Government servants not only are there express provisions in the Constitution Act providing that the tenure is at pleasure but there is also such an implied them of their service as pointed out by the Privy Council in R. Venkata Rao case [39 Bom. L.R. 699] (vide supra) where they refer to the following observations of the Board in Shenton v. Smith [1895 A.C. 229] :
'They consider that unless in special case where it is otherwise provided, servants of the Crown hold their offices during the pleasure of the Crown, not by virtue of any special prerogative of the Crown but because such are the terms of their engagements, as is well-understood throughout the public service.'
33. No such implied term can, in our opinion, be understood in respect of municipal servants. Judicial authority on the point is, no doubt, not uniform. Some High Courts have taken the view that in the absence of an express provision in the statute a municipal servant holds office at pleasure and his position in that respect approximates to that of a Government servant. It is enough to refer to the decision of the Allahabad High Court in Prabhulal Upadhya v. District Board, Agra : AIR1938All276 , which is representative of that view. Some High Courts have taken a contrary view and the Bombay High Court is amongst these. The first case in which the point was considered by the Bombay High Court was Dhulia Municipality v. Ramchandra [39 Bom. L.R. 1269]. There the services of the chief officer of the municipality were terminated in contravention of the provisions of S. 33(2) of the Bombay Municipal Boroughs Act, 1925, which provided that no chief officer shall be removed from office, reduced or suspended except by the votes of at least two-thirds of the whole number of councillors. In that case the resolution terminating the employment was not passed with that majority. The chief officer sued for damages for wrongful dismissal. The trial Court held the plaintiff's dismissal unlawful, being in contravention of S. 33(2), and further held that he was entitled to the salary he would have earned if he had served till he completed the age of 55. The suit was therefore decreed. In appeal by the municipality it was contended that the non-observance of S. 33(2) gave no cause of action as the plaintiff held office at pleasure and reliance was placed on the decision of the Allahabad High Court in Roshanlal v. District Board, Aligarh : AIR1935All802 . Broomfield, J., said that he was by no means satisfied that the general rule applicable to Crown servants applied in its entirety to other public servants also but in any case the statutory provision in S. 33(2) was a limitation of the right to dismiss at pleasure. The provisions of S. 33, he said, may reasonably be said to affect the tenure of the post and to give the chief officer the right to hold office until removed from it in the manner provided and the removal contrary to S. 33 must be regarded as an infringement of plaintiff's right to hold office unless and until he is lawfully removed. Wasoodev, J., took substantially the same view. As regards the quantum of damages it was held that in view of the provisions of S. 33 the service of chief officer being at the will of the municipality, the only limitation being that it must be expressed in the manner provided by the section and as there was nothing to prevent the plaintiff being removed from office at any time by a voted resolution under S. 33, the only damages he can claim are wages for the period of the notice. No doubt Dhulia Municipality case [39 Bom. L.R. 1269] (vide supra) was a case of a breach of statuary provision in the Act, but the same principle was held by the Bombay High Court to apply to the breach of the provisions of a statutory rule; see Gokak Municipality case [42 Bom. L.R. 886] (vide supra). In that case their lordships said :
'In the case of Crown servants the prerogative of the Crown come into play. It is quite reasonable to say that in such a case the general rule is that Crown servants can be dismissed at pleasure without giving a cause of action, and it anyone alleges an exception to that rule, he must show that there is an exception in a statute which binds the Crown. But if there is no general overdoing principle of liability to dismissal at pleasure, if you have to look to the special law to ascertain what the conditions of service are, it is difficult to see why a distinction should be made between a statutory provision and a provision made by a statutory rule.'
34. The ratio of these two decisions of the Bombay High Court is that there is no general overriding principle of liability to dismissal at pleasure in respect of municipal servants but their tenure must be ascertained from the special law governing their conditions of service. The special law may in terms provide for determination of the service 'at the pleasure of' or 'at the discretion of' of the municipal board in which case the tenure would be terminable at pleasure. It may provide as in the case of a chief officer under the District Municipal Act, 1901, for determination of service by a resolution passed by the municipality in which case the tenure is terminable at will, the will being expressed by a resolution passed in the manner provided by the statutory provision. It may provide for different modes of termination and if the provisions are self-contained and exhaustive in that regard, the tenure can come to an end only in one of these modes. So much is clear. But what if the special law governing the conditions of service makes no provision for tenure or for the mode or the conditions of the exercise of the undoubted power of termination of employment, that power being a necessary concomitant of the power to appoint Then on principle, as the doctrine of pleasure is not of necessity attracted, if there is no special contract between the parties, the general law of master and servant would apply. The general law is that the services of the employee are terminable at any time by reasonable notice. In Ram Babu Rathaur v. Divisional Manager, Life Insurance Corporation of India : AIR1961All502 the Court held that the relationship between the employee and the said Corporation had to be determined in the absence of any statutory provision or a special contract, by the general law of master and servant. This view was stated to be correct by Shah, J., in S. R. Tiwari v. District Board, Agra [1964 - I L.L.J. 1]. Barwell and Karr in their Master and Servant, Vol. I (pp. 383-393) after examining various English and Indian authorities on the point sum up their view at p. 393 as under :
'In our submission, then, the true view is that the conditions of service of employees under local bodies in India are to be ascertained from the special statute by virtue of which the Indian municipality or other local body is created, read with such statutory rules or bylaws as have the force of law; and that if the relative enactment to attracted be silent upon the character and extent of a servant's tenure of office, the document or other evidence from which the terms of the individual contract are to be collected must be looked to; and, should those terms include no provision as to the manner in which, apart from dismissal for misconduct, the contract of service may be determined, the rule as to the necessity of implying a term requiring reasonable notice will take effect.'
35. Therefore, if the special law contains no provision for tenure, the services of the employee are terminable at any time on reasonable notice.
36. It has not been urged before us by counsel on either side that the Act contains any provisions bearing on the tenure of the employees. There is also no contention that there is any special contract in respect of the plaintiff's tenure. Section 46 of the Act empowers the municipality to make rules not inconsistent with the Act on the various subjects set out therein. Such rules may be made under Clause (b) determining the staff of officer and servants, their duties, salaries, allowances, etc., under Clause (e) determining mode and conditions of appointing, punishing and dismissing and under Clause (g) regulating the period of service of officers and servants and determining conditions under which the officers or servants may receive pension, gratuities on retirement or discharge from service. Therefore, it is possible to provide for tenure by rules made under S. 46. Sri Bhatt says no rule has been made giving any security of tenure. The only rule Sri Vakil relied on is the rule made on 31 May, 1952. It reads as under :
'1. (a) Except as otherwise provided in the following clause the date of compulsory retirement of a municipal servant, other than an inferior servant is the date on which he attains the age of 55 years. He may be retained in service after the date of compulsory retirement only with the previous sanction of the municipality on public grounds which shall be recorded in a resolution passed by the municipality with the support of at least three-fourths of the whole number of councillors.
(b) A municipal servant in inferior service should be required to retire at the age of 60 years. He may not be retained in the service after that except with the sanction of the municipality.
2. Each municipality servant's case should be taken up when he is approaching the age of superannuation and before the expiry of each extension of service. Extension may not be granted for any period exceeding one year at one time, the first extension being given generally up to the end of the financial year. In cases in which it is proposed to grant extensions of service, reports should be made to the municipality through the controlling officer at least two months before the necessity for the sanction or fresh sanction arises.
3. Without the previous sanction of the municipality no promotion whether acting or substantive in a permanent or temporary establishment should be given to a municipal servant who is under extension. This rule does not debar such municipal servant from earning an increment if the pay of the appointment held by him is on a time-scale or from drawing enhanced pay, if the pay of his appointment is enhanced as part of a general scheme of revision.'
37. Sri Vakil argues that this rule provides for security of tenure up to the age of 55, or in other words, a municipal servant has a right to the post of appointment till he reaches the age of 55 and the only method of removing him would be punishment of dismissal or removal. We are enable to read the rule as suggested by Sri Vakil. As the heading of the rule shows it is a rule framed for 'the compulsory retirement of employees.' It therefore fixes the upper age-limit of employment. The reading of sub-rules (a) and (b) of rule 1 makes this clear. It debars the municipality from continuing in employee beyond the age specified, unless of her requirement are satisfied. This compulsory age of retirement is referred to in rule 2 as the age of superannuation. Even in cases where employment is continued beyond that age, after following the procedure laid down in rule 1, extension of employment cannot exceed one year at a time. It is not possible to construe that rule as conferring a right to be continued till the age, which is referred to as the retirement age, is reached. The rules control and regulate the municipality's power of employment in so far as concerns the age of employees, but they do not confer a right of employees to be continued in employment till that age. Any comparison with the rules relating to Government servants will not be apt. The conditions of service of Government servants are governed by fundamental and other rules. These rules provide for creation of cadres, fixation of number of posts in each cadre, determination of nature of posts, whether permanent or temporary, and the right of lien. These provisions read together give to a Government employee appointed substantively to a permanent post a right to the post, see Parshottam Lal Dhingra v. Union of India [1958 - I L.L.J. 544]. It is this right which gives security of tenure. The removal of such a Government servant would be per se punishment and his right to the post cannot be terminated except in accordance with the rules governing the termination. Therefore, the rule relied on by Sri Vakil does not lend itself to the construction he places on it. The right of removal under rule 95 earlier noticed also negatives such a construction. The appointing authority has a right of removal. For removal no procedure, as in the case of dismissal, is prescribed. If there was right to the post, the right of removal would be conditioned. No doubt a procedure is provided for dismissal but from that a fixity of tenure or a right to the post cannot be inferred. The reasonable inference, having regard to the general legal position, is that the procedure so prescribed for dismissal indicates no more than that the power of dismissal shall be exercised in a particular manner. It does not by implication indicate a security of tenure.
38. This being the position regarding the tenure of the plaintiff-appellants, the question next is whether the non-compliance with the requirements of rule 97 would entitle the party aggrieved to the reliefs sought in these cases. We shall examine later whether there has in fact been non-compliance in all or any of these cases, but we propose to consider the legal position first. The reliefs sought are :
(1) A declaration that the resolution of the municipalities illegal, void and of no effect.
(2) A declaration that the resolution did not affect the continuance of the plaintiff's service and his service benefits.
(3) A perpetual injunction restraining the municipality from enforcing the said resolution.
39. The first two declarations are not substantially different. The first declaration is preliminary to the second. If the first declaration is given, a statutory body must proceed on the footing that the order made by it did not exist and has no effect whatsoever. The second declaration therefore only makes clear the effect of the first declaration. The perpetual injunction sought has the same object as the declaration. The main relief sought is therefore a declaration in terms earlier set out. Now such a declaratory relief is governed by the terms of S. 42 of the Specific Relief Act, 1877, which was in force at the time the suits were filed, corresponding to S. 33 of the Specific Relief Act, 1963. A suit for a declaration is maintainable if the plaintiff is to entitled to any right to property or to any legal character and when the Court finds that he is so entitled
'the Court may, in its discretion, make therein a declaration that he is so entitled, and the plaintiff need not in such a suit ask for any further relief.'
40. It has not been argued before us that the suit is not governed by the provisions of the said S. 42. The argument has proceeded on the footing that the plaintiff had a legal character to uphold and the only point argued is whether the Court should exercise its discretion in the plaintiff's favour. Now the first point to be noticed is that any such declaration and any consequential relief thereon would be enforcing a contract of personal service. In the ultimate analysis what has happened here is a repudiation of contract of service. As the tenure is contractual, however wrongful the termination may be, the contract has been put an end to by one party by repudiation. A master is not obliged to accept the services of a servant whose services he does not want nor a servant obliged to render services to a master whom he does not wish to serve. This principle is embodied in S. 21(b) of the Specific Relief Act, 1877 (corresponding to S. 14(1)(b) of the Specific Relief Act, 1963). This is not to say that the Court has no power or jurisdiction to declare that the contract is not at an end, but the relief being under the law discretionary, when such a declaration amounts to enforcing an obligation of a personal nature, the Court must have compelling reasons to give such a declaration. The circumstances of the case may be such as called for the exercise of the Court's discretion. There may for example be a case of a statutory body acting in clear breach of a mandatory provision governing its action, and the action cannot be remedied except by restoring the position that would have obtained but for the action. The Court however must consider whether it is proper to do so because in doing so it would be departing from the rule that a contract of service is not ordinarily enforced. Another factor which the Court must notice is that unless the declaration and the consequential injunction were meant to fasten an employee on an employer permanently, which it would not be proper to do if the employment is terminable on reasonable notice, the relief granted can be made ineffective no sooner it is granted. The municipality's right to terminate is not confined to a power of dismissal. It can terminate by a removal or by discharge and the declaration and injunction cannot prevent it from exercising these rights. Section 56 of the Specific Relief Act, 1877, provides inter alia that an injunction cannot be granted to prevent the breach of a contract the performance of which would not be specifically enforced. Then again, in exercising the discretion under S. 42 the Court has also to consider whether or not damages would be an adequate relief. Clearly in a case of this nature damages would be an adequate relief. The plaintiff is not disabled or debarred from serving elsewhere. The plaintiff's continuance in service, on the other hand, would, by forcing an unwelcome employee on an unwilling employer, give rise to tensions and failed to achieve the object of the declaration.
41. To turn to authorities, in Dhulia Municipality case [39 Bom. L.R. 1269] (vide supra) the chief officer who was removed in accordance with the provisions of S. 33(2) of the Bombay Boroughs Act, 1925, corresponding to S. 182(2) of the Bombay District Municipal Act, 1901, sued for damages. He was 53 years of age when so removed. Under the rules he could have served up to the age of 55, for rule 188 provided :
'Subject to S. 182 of the Act, every municipal officer or servant is liable to discharge at one month's notice, but, except with the concurrence of the president and the sanction of the municipality, no officer or servant whose salary exceeds Rs. 25 shall be discharged before he attains the age of 55.'
42. The amount claimed by the plaintiff for damages was salary for two years. The Court, while holding that the removal was not in accordance with the statutory provisions, held that plaintiff had no right to serve till he reached the age of 55 and that the only damages he could claim was for the period of notice and he was given damages equivalent to one month's salary. No doubt in that case the plaintiff did not claim a declaration that he had continued in service but his claim for damages was made on that footing. The rejection of that claim was founded on the ground that although the removal being contrary to the statutory provision was unlawful, there was no definite term of employment fixed but it was a case of service at the will of the municipality, the only limitation being that the will of the municipality must be expressed in the manner provided by S. 33. In Prabhulal v. Upadhaya : AIR1938All276 the point arose more directly. The plaintiff who was the secretary of the District Board, Agra, was dismissed by a resolution of the municipality in clear violation of S. 71 of the Uttar Pradesh District Board Act which section was similar S. 33(2) of the Bombay Municipal Boroughs Act, 1925. The plaintiff asked for a declaration that the resolution was null and void, illegal, wrongful, ultra vires and an injunction restraining the board from giving effect to the same. The Court held that the non-compliance with the provisions of S. 71 gave plaintiff a cause of action. Proceeding to consider the relief to which the plaintiff was entitled, Harries, J., observed :
'In my view this is not a case where an injunction could possibly be granted to the plaintiff and without an injunction the declaration claimed would not be really effective. The plaintiff was a servant of the board whose duties were of a personal and confidential character and it would be utterly impossible for any Court to ensure that in the event of an injunction being granted its terms would be strictly carried out by the parties.'
43. He then referred to Ss. 56, 21 and 42 of the Specific Relief Act. He took the view, based on the doctrine of pleasure, that the plaintiff was not entitled to a legal character as contemplated by S. 42 but proceeded to examine the matter on the footing that he was so entitled and observed :
'The words of the section are :
'and the Court may in its discretion make therein a declaration.'
As I have stated previously, the Court cannot grant an injunction in this case and that being so, even if the plaintiff was legally to a declaration I would not be prepared to grant one because the mere granting of a declaration without an injunction would not be an effective remedy. In any event, relief by way of damages is, in my view, adequate in cases of this kind and that being so a Court can in its discretion refuse a declaration or injunction.'
44. In S. R. Tiwari v. District Board, Agra [1964 - I L.L.J. 1] (vide supra) the services of the petitioner who was in the service of the board as an engineer were terminated by a resolution under which he was given three months' salary in lieu of notice. The petitioner's contentions were that there was no right to terminate except by dismissal, that at any rate the termination was capricious and was in reality a dismissal and that as a dismissal it was not in accordance with the statutory provision. The relief claimed by the petitioner was to have the resolution of the board quashed and a writ in the nature of mandamus to be issued commanding the board to treat the petitioner as the lawfully appointed engineer and not to give effect to the resolution terminating his services. A preliminary contention was raised on behalf of the board before the Supreme Court that the jurisdiction of the High Court even under Art. 226 of the Constitution was restricted by S. 21(b) of the Specific Relief Act, 1877, and that the relief claimed by him cannot in cannot in any event be given, the remedy, if any, of the petitioner being to claim damages by suit for wrongful termination of employment and not a writ declaring the termination of employment unlawful and a consequential order for restoration in service. The Supreme Court held that in cases of breach by a statutory body of a mandatory obligation imposed on it by statute, the Court had the power to declare its action in such breach as illegal or ultra vires, even if by making the declaration the body is compelled to do something it does not desire to do, but, said the Court :
'the jurisdiction may be exercised only when the Court is satisfied that departure is called for from the rule that a contract of service will not ordinarily be specifically enforced.'
45. The Court did not, in that case, consider in what special case a departure will be made, for the action in that case was found not to be in valuation of any mandatory provision. These authorities, therefore, go to establish that although the Court has power to make a declaration which would have the effect of enforcing a contract of personal service, the Court will exercise that power only when a departure from the ordinary rule that a contract of personal service will not be specifically enforced is clearly called for.
46. Sri Vakil, however, invites our attention to decision of the House of Lords in Vine v. National Dock Labour Board [(1956) 3 All E.R. 939] and the decisions of the Supreme Court in Life Insurance Corporation v. Sunil Kumar [1964 - I L.L.J. 442] and Dock Labour Board, Calcutta v. Jaffar Imam [1965 - II L.L.J. 112]. In Vine v. National Dock Labour Board [(1956) 3 All E.R. 939] (vide supra) the plaintiff was a registered dock worker employed in the reserve pool by the National Dock Labour Board under the scheme set up by an order issued under S. 2 of the Dock Workers (Regulation of Employment) Act, 1946. The object of the scheme was to ensure regularity of employment and availability of workers. Under it a National Dock Labour Board was establish and its functions set out. No employer can engage labour at the dock unless he is registered under the scheme and no dock worker can be employed at the docks unless he also is registered under the scheme. To be registered as a dock worker is, therefore, the first step to getting employment. Further, having been registered the workers come on pay-roll of the National Dock Labour Board. He is in, what the scheme calls, the reserve pool and while in the reserve pool, is in the employment of the National Board. While in the reserve pool he is to be at call and when allocated for work at the docks he comes for the time being into the employment of the particular registered employer requiring his service and when his employment is finished he falls back again in the reserve pool. It is open to the dock worker to get out of the scheme on due notice. His employment may also be terminated by the National Board by notice as provided in the scheme. He may also be dismissed summarily for failure to comply with any of the provisions of the scheme. In this case the plaintiff was dismissed by a disciplinary committee of a local board to which committee the powers of the National Board under the scheme were purported to be delegated. The plaintiff sued claiming damages for wrongful dismissal and a declaration that his purported dismissal was illegal, ultra vires and invalid. It was found that the plaintiff had failed to comply with the provisions of the scheme and was liable to be dismissed but the disciplinary committee had no power of dismissal as delegation of that power to the said committee was not permissible. The dismissal was therefore, held to be a nullity. The plaintiff was awarded suitable damages. Their lordships then proceeded to consider whether a declaration also should be given as prayed for. It was held that the granting of a declaration was discretionary. In that case, however, the granting of the declaration by the trial Judge was held to be a proper exercise of discretion. The reasons given are that the position of a dock worker in relation to the National Dock Board is not that of an employee under an ordinary contract of service but that under the scheme he acquires a status and a right of employment at the dock, that the status he acquires is bound up with his being in the reserve pool and that damages would not be an adequate remedy. This case, therefore, establishes that even when an act of termination of service by dismissal is a nullity, a declaration to that effect does not follow as a matter of course, but is a matter of the Court's discretion to be exercised along well-known judicial principles.
47. In Life Insurance Corporation v. Sunil Kumar [1964 - I L.L.J. 442] (vide supra) the Supreme Court was considering the orders of the Corporation terminating the services of certain officers called field officers (later designated as development officers). Their conditions of service were determined by the provisions of S. 11 of Act 31 of 1956 and by orders issued in exercise of the power conferred by Sub-section (2) of that section. An order was issued under the same provision. Clause 6 thereof provided for retirement and Clause 10 for penalties and for termination of service otherwise than as a penalty. On a consideration of these provisions the Supreme Court found that the order issued under S. 11(2) was a self-contained code as to the terms and conditions of service of the filled officers and any action intended to be taken for termination of service has to be under Clause 10(a) or 10(b). The termination in the cases which Supreme Court was considering was not in accordance with the said Clause 10. The Supreme Court confirmed the High Court's order directing a writ in the nature of certiorari to issue quashing or setting aside the impugned orders. No question appears to have been raised before the Supreme Court as to what would be the appropriate relief. Besides it would appear that S. 11 of the Act and the order issued Sub-sec (2) thereof gave security of tenure to the field officer which could not be determined except in the manner laid down by Clause 10 of the order. The case does not, therefore, assist Sri Vakil.
48. In Dock Labour Board, Calcutta v. Jaffar Imam [1965 - II L.L.J. 112] (vide supra) the employment of certain dock workers was terminated by the Calcutta Dock Labour Board on suspicion that they were engaged in activities prejudicial to the country. No opportunity was given to the workers to show cause. These orders were quashed on writ petitions by the Calcutta High Court and the board came in appeal to the Supreme Court but failed. The dock workers were employed under a scheme framed under S. 4 of the Dock Workers (Regulation of Employment) Act, 1948 (9 of 1948). The scheme created a reserve pool. The scheme was, it would appear, similar to the scheme in Vine case [(1956) 3 All E.R. 939]. Therefore this case also does not assist Sri Vakil.
49. It was urged in the course of arguments that even if the declaration of continuance in service and the injunction sought are not granted, at least the first declaration that the order of dismissal is illegal and ultra vires as being in contravention of rule 97 should be given, because the order of dismissal attaches a stigma and that stigma can be removed if the Court gives such a declaration. Now a declaration that the orders of the municipal body are illegal, void and of no effect must necessarily import an obligation on the party against whom the declaration is made to restore the original position. The declaration has otherwise no meaning. It must be remembered that it is the termination of employment which furnishes the cause of action. The termination of employment can be in various ways. It may be by superannuation, by compulsory retirement, by discharge, by removal or by dismissal. If a wrong mode or a mode not available is adopted, the termination is wrongful. Where the tenure is contractual, legally an action for wrongful dismissal is an action for breach of contract to employ and any declaration declaring the action ultra vires must have the effect of restoring the contract of employment as if it was never broken. No sooner the declaration is made the plaintiff could return physically to the employment of the defendant, and could the defendant then say that he (the plaintiff) was not in his employ, the declaration notwithstanding It is the substance of the Court's order that matters. As we said earlier the statutory body in respect of whose action the declaration is given must proceed on the footing that the order made by it did not exist and had no effect. As observed in Ram Babu Rathaur case : AIR1961All502 the Court must assume that the orders passed by it will be obeyed in substance whatever the form of the order and the logical result of quashing an order of dismissal would be the reinstatement of the petitioner to his office. When his lordship Shah, J., in S. R. Tiwari case [1964 - I L.L.J. 1] (vide supra) says :
'even if by making the declaration, the body is compelled to do something which it does not desire to do,'
he clearly envisages the continuance in service as a necessary result of declaring the order of the tribunal illegal and ultra vires. In Vine case [(1956)] 3 All E.R. 939] (vide supra) the only declaration that was sought and given and was considered sufficient was that the action of the defendants in dismissing the plaintiff was ultra vires and invalid. Therefore, a declaration that the act of a statutory body is illegal and ultra vires will compel that body to restore the position which obtained before the act so declared. If the body does not do it, it may make itself liable to be proceeded against. On the others hand, the non-making of such a declaration does not debar the employee from suing for damages not only for wrongful termination but also for the stigma which may have attached to him and it cannot be said that a decree for damages would not afford adequate relief. If would remove the stigma also.
50. On this view of the law the decision of the lower appellate Court is correct through on different grounds, and it is not necessary to examine the facts of each case and ascertain whether the requirements of rule 97 were complied with, but as the learned counsel have addressed us on that aspect also, we shall in deference to their arguments, deal with the facts in brief.
51. Second Appeal No. 306 of 1960
52. In this case the plaintiff was an octroi karkun in the employ of the municipality. He joined the municipal service as a peon in May, 1941 and was promoted as octroi karkun in January, 1950 in the grade of Rs. 40 - 2 - 60. He was dismissed from service from 19 October, 1953 by the resolution No. 1 of 1954 passed by the general body on that date. The circumstances under which that resolution came to be passed were these. On 5 July, 1953 when he was on duty at the octroi naka, 45 bags of coal on camel's back entered the municipal limits but octroi duty was charged on only 14 bags. The charge against him therefore was that he had failed to collect octroi on 31 bags. When this misconduct of the plaintiff came to the notice of the municipality, the municipality after a preliminary inquiry called upon the plaintiff to explain. The plaintiff's statement was recorded by the president on 13 July, 1953. Therein he offered some explanation. That explanation was found to be contradictory with documents and therefore a notice dated 23 July, 1953 was given to him calling upon him to submit his written explanation in this connexion. The written explanation that he gave now was different from the one that was given on 13 July, 1953. The president suspended him by an order dated 7 August, 1953. The suspension took effect from 8 August, 1953. He was then by a notice dated 10 October, 1953 asked to remain present before the general body on 19 October, 1953. Accordingly, he appeared before the general body with his pleader and after they were heard the general body passed the resolution dated 19 October, 1953 dismissing him from service. It will be noticed therefore that the plaintiff was clearly told what was his misconduct. The fact that he was so clearly told is apparent not only from his statement dated 13 July, 1953 (Ex. 35 in the case) but also from his detailed explanation dated 28 July, 1953 (Ex. 36). The resolution removing him from service which is endorsed below Ex. 36 gives the reasons why he was being removed from service. The provisions of rule 97 have, therefore, been complied with. The only argument which Sri Parghi was able to advance was that the plaintiff was not specifically told that he was going to be removed from service. Rule 97 does not lay down any such requirement and at any rate having regard to the order issued to him on 7 August, 1953 in which he was told that because of the seriousness of the offence it was not desirable to continue him in service and he was being suspended from service from 8 August, 1953, it cannot be said that he was not aware of what the municipality proposed to do if the offence was proved.
53. Second Appeal No. 307 of 1960
54. The plaintiff in this case was a temporary cattle-pound keeper in the employ of the municipality. He joined service in October, 1947 on a pay of Rs. 15 plus dearness allowance of Rs. 20. From August, 1948 his pay was increased to Rs. 20 and dearness allowance to Rs. 25. The misconduct for which he was proceeded against was detected in or about October, 1953. It appears that just before October the Government auditor audited the municipal accounts. When the auditor's report was forwarded to the municipality in October-November, 1953, it came to the notice of the municipality that there were numerous irregularities of a serious nature in the working of the cattle-pound of the municipality. The plaintiff was, therefore, suspended by the municipal president by an order dated 20 January, 1954 and was required to remain present before the president on 28 January, 1954 for giving his statement with reference to the audit objections. That notice has been produced and therein it has been stated that during the audit and in the other inquiry it has been found that he was negligent and careless in discharging his duties. Therefore this notice makes a charge of negligence and carelessness. A further notice was given to him on 1 February, 1954 wherein it was stated referring to the period of audit that the amount of public auction of cattle paid to him was not reflected in any credit entry in the daba rojmel. In his reply dated 3 February, 1964 (Ex. 38) he asked for fifteen days' time to give an explanation after he had seen rojmels and relevant papers. By a resolution dated 5 February, 1954 eight days' time was granted (Ex. 39). He gave a detailed written explanation on 22 March, 1954, in which after setting out all the items and examining them he stated that there appears to be a mistake in respect of one of the items relating to two cows and it may be that it had remained to be shown in the khata of Patan Daba through oversight. Then he went on to urge that the work that was being taken from his was against the provisions of the Cattle Trespass Act and concluded by stating that full amounts have been credited but there may be a mistake in the writing of dates and, therefore, the dates cannot be reconciled and therefore there was no mala fide intention on his part. On 22 March, 1954 the plaintiff asked for an opportunity to explain in person. The general body met on 30 March, 1954 and heard him in person. Then at the meeting of the municipality on 8 July, 1954 a resolution was passed dismissing him with effect from 5 February, 1954. It appears that effect was given from 5 February, 1954 because he was on his own request given time from 5 February, 1954 for his explanation. In the resolution of dismissal it is stated that although sufficient opportunity was given, the plaintiff had not given any explanation and from the record available it appeared that there was mischief in daba khata and that the case was one fit for fitting a complaint against the plaintiff under the Prevention of Corruption Act, 1947. He was accordingly dismissed.
55. Sri Vakil contended that the plaintiff was not told the exact nature of the allegations he was to answer nor was he told that the inquiry against him was with a view to take disciplinary action. It is not possible to accept that contention. The notice dated 20 January, 1954 and the notice dated 1 February, 1954 sufficiently indicate what was the misconduct alleged against him. It is true that in none of these notices was he told that disciplinary action was going to be taken against him. But in the notice dated 20 January, 1954 he was told that he was being suspended from service and in the resolution dated 5 February, 1954 under which he was given further time to file his written explanation there is a mention of his dismissal from 5 February, 1954 after his explanation is received, meaning that if the explanation is not found satisfactory he would be dismissed from 5 February, 1954. The plaintiff was therefore sufficiently aware that disciplinary action was contemplated against him. It is next urged by Sri Vakil that the plaintiff was denied a reasonable opportunity of giving his say because the details he had asked for in his letter dated 8 February, 1954 were not furnished to him. It appears that he had seen the accounts and it was on his inspection of the accounts that his reply Ex. 50 was based. It was then urged by Sri Vakil that the resolution of the municipality dated 8 July, 1954 mentions that the plaintiff has not given any explanation and from this it is clear that the municipality had not applied its mind at all, or had not considered the explanation tendered in detail by the plaintiff. What is probably meant by saying that the dabakamgar had not given any explanation was that the explanation furnished by him was not satisfactory. It was urged that the dismissal was illegal in so far as it was made with effect from an earlier date and that it should take effect only from 8 July, 1954. That no doubt is correct. But as there is no claim for damages in the suit nothing is required to be done in so far as that contention is concerned.
56. Second Appeal No. 350 of 1960
57. The plaintiff in this case was first appointed as a house-tax clerk in February, 1954 by the municipality at a monthly pay of Rs. 30, later increased to Rs. 40 and a dearness allowance of Rs. 35 per month. After he had worked as such house-tax clerk for about one and a half months he was transferred as nakedar. While he was working as such nakedar he refused to do night shift with effect from 16 May, 1954 as required by his superior and although he was assigned night shifts from 17 to 24 May, 1954 he did not turn up for work and he left the naka unattended. Thrice he was directed in writing to do the night shift and thrice he refused. Therefore, on 18 May, 1954 the chief officer who was his superior made an order that on account of his insubordination no work should be assigned to him. This was followed by an order of the president dated 25 May, 1954 dismissing him from service with effect from 26 May, 1954. It appears that the plaintiff moved the director of the local authority who set aside the order of the president and directed that the matter be placed before the general body as in the opinion of the director of the local authority the president had no right to dismiss. The general body met on 27 April, 1955. The plaintiff remained present at that meeting and he read over his explanation which he had brought ready written. The general body confirmed the order of the president dismissing the plaintiff from 26 May, 1954. The dismissal was from 26 May, 1954 because the general body took the view that the president had a right to dismiss. The only contention urged on behalf of the appellant before us is that the appellant was never told what was the charge against him which he had to explain. This contention cannot be accepted. On 18 May, 1954 the chief officer made his report to the president. In that report which is Ex. 33 the appellant's refusal to perform the night shift and his having left the naka contrary to the orders were pointed out and it was stated that the appellant.
p>'was rude, and he was not performing his duties properly and was committing the breach of the order.'
58. This report was shown to the appellant and bears his endorsement below it of the same date, in which he justifies his leaving the naka as nobody came over to take charge from him. It is obvious, therefore, that the appellant was aware of the charge against him and the only explanation he had to give about it was that he left the naka as nobody relieved him. He had no explanation why he refused to carry out the orders in respect of the night shift. It has not been urged that the president did not have the power of dismissal. The rules show that the president had the power and the view taken by director of the local authority to the contrary does not appear to be correct. Nevertheless, the plaintiff was again given an opportunity to explain in the meeting held on 27 April, 1955 and he read over his explanation which he had brought in writing. The resolution of the general body dated 27 April, 1955 (Ex. 26) shows that the explanation was taken into consideration and that thereafter they approved the action of the president and confirmed it pointing out that such action was necessary for the purpose of administration of the municipality. In these circumstances, it is not possible to hold that the provisions of rule 97 were not complied with.
59. Second Appeal No. 377 of 1960
60. The plaintiff in this case was in the service of the municipality since about 1940. At the time action was taken against him he was the secretary of the municipality. The accounts of the municipality covering the period 1950-53 were audited by the Examiner, Local Fund Accounts, Bombay, and the special audit of the railway station octroi naka disclosed that during the period from 1 April, 1950 to 30 September, 1953 the nakedar had misappropriated a sum of Rs. 35,906-13-9. The report shows that the fraud was facilitated mainly by the absence of any checking at any time during the above period either by the chief officer or the secretary or the account clerk though rule 16 of the octroi bylaws which applied laid down that the above persons should inspect all the account books and submit their reports to the president. On 6 October, 1953 the president called upon the plaintiff to remain present as his presence was necessary for some important work. In that letter, however, no details were given. On 10 October, 1953 a statement of the plaintiff was recorded. That statement which is at Ex. 49 shows that he was told that on inspection it had come to light that there was misappropriation at the railway octroi naka. He stated in that letter, inter alia, that as more than one officer was assigned the duty to make inspection there should have been a proper scheme. He admitted that he had not made any inspection of the railway octroi naka but explained his failure on the ground that he had no knowledge of any malpractice at that naka. On 16 December, 1953 the president gave a notice (Ex. 50) to the three officers concerned including the plaintiff. After referring to the big misappropriation of the money at the railway octroi naka, the failure of the officers to supervise and the fact that they had shown negligence in that respect it was stated that a decision was taken to take action against them and therefore if they had any explanation to tender they should do it on 21 December, 1953, before the municipality. Then on 8 July, 1954 a showcause notice was given to all the relevant officers including the plaintiff stating that during the period mentioned therein a serious defalcation of the octroi receipts at the railway naka had occurred and that if the officers to whom notice was given had exercised supervision and check this defalcation would not arise. The notice ended by stating that :
'you are therefore called upon to show cause within a week after the receipt of this letter why departmental and legal action should not be taken against you for his culpable negligence of duty.'
61. To this the plaintiff sent a reply on 23 July, 1954 (Ex. 41) reiterating the stand taken by him in his earlier explanation and further containing that no specific duty was assigned to him as the secretary to inspect the accounts of the octroi railway naka. A meeting of the general body took place on 5 November, 1954 and passed the impugned resolution. That resolution which is at Ex. 31 concerns all the officers against whom the show-cause notice had been issued. It states that the report of the inquiry committee was read and the written explanations of the officers were also read and that the board fully agreed with the report of the inquiry committee. Then facts and reasons are set out and it is unanimously resolved to dismiss the plaintiff. It is argued on behalf of the appellant firstly that the first notice dated 16 December, 1953 has to be ignored because nothing was done after the general body met on 21 December, 1953 and that therefore the proceedings so far as the dismissal is concerned really commenced with the show-cause notice dated 8 July, 1954 (Ex. 51) and in that notice all that he was called upon to show cause was why departmental and legal action should not be taken against him. The argument is that this only means that he was called upon to explain why an inquiry should not be held and he was not called upon why he should not be punished for the misconduct alleged against him. The expression used in the notice is :
'to show cause within a week after the receipt of this letter why departmental or legal action should not be taken against you for this culpable negligence of duty.'
62. This cannot be construed to mean that any explanation was to be tendered as to whether or not a departmental enquiry should be held. The letter must be read in the light of what had preceded and in the light of the other recitals in the letter, which set out the nature of the misconduct. It was a letter from the president himself. When the expression used is 'departmental action,' the reasonable reading in the context of the letter and in the light of the previous proceedings would be that he was called upon to explain his misconduct and to explain why for that misconduct he should not be punished departmentally as also 'legally' (meaning presumably action in a Court of law). The next submission on behalf of the appellant is that the resolution shows that some report of the inquiry committee was taken into consideration but as no explanation of the plaintiff was asked for in respect of that report nor was that report brought to the notice of the plaintiff, it cannot be said that the plaintiff was given a reasonable opportunity to give his say. There is substance in that contention and we are inclined to hold that the opportunity given to the plaintiff for that reason was not reasonable and, therefore, rule 97 was not wholly complied with.
63. Second Appeal No. 662 of 1960
64. The plaintiff was appointed as a sanitary inspector in November, 1950 in the grade of Rs. 80 - 10 - 130 with the starting pay of Rs. 80 per month and dearness allowance of Rs. 45 per month but he took charge of the post in September, 1951. The plaintiff was a temporary servant. Having served for nearly three years, as he was not granted any increment, he applied to the municipality in October, 1954 to make him permanent and to grant him increments with retrospective effect. On 11 July, 1955 the general body of the municipality passed a resolution stating that though opportunity was given, there is no improvement in the work of the plaintiff and therefore after giving him notice for one month he should be relieved on the expiration of the period of notice. Accordingly, a notice was given to the plaintiff on 13 August, 1955 and at the expiration of the period of the notice he was relieved. It is obvious that this is not a case of dismissal to which rule 97 is attracted but a case of discharge. The argument however is that the trial Judge held it a case of dismissal and gave a declaration that the said dismissal was wrongful but neither void nor inoperative and as the municipality did not go in appeal against that decree but only the plaintiff went in appeal, the municipality cannot now challenge that finding of the lower court. There is substance in that contention.
65. Therefore, if it is held that this was a case of dismissal it has to be held that the dismissal was not in compliance with the provisions of rule 97.
66. In the result, however, in the view we take of the legal aspect of the matter the appeals must be dismissed. Appeals dismissed with costs.