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Balaram Chatterjee Vs. Hindustan Steel Ltd. - Court Judgment

LegalCrystal Citation
SubjectLabour and Industrial
CourtKolkata High Court
Decided On
Reported in(1975)ILLJ23Cal
AppellantBalaram Chatterjee
RespondentHindustan Steel Ltd.
Cases ReferredS.S. Shetty v. Bharat Nidhi Ltd. A.I.R.
- .....idea is to compensate the employee for loss of his wages or salary, not to punish the employer for wrongful dismissal. normally the damages recoverable will be the amount of wages or salary for the period of proper notice, for that amount will represent what the employee has lost by being dismissed without such, notice. hence if the employee has been given the amount which represents his salary or wages for the period of such notice no action for wrongful dismissal will lie against the employer. however, there may be circumstances in which more may be recovered for example, if the effect of such dismissal is to make the employee's task of finding other employment more difficult.14. mr. mukherjee further relies on the statement of law in the well-known book of 'the law of master and.....

Dipak Kumar Sen, J.

1. Balaram Chatterjee, the plaintiff in this suit, was appointed by the defendant Hindustan Steel Ltd. in its establishment known as Durgapur Steel Project in the post of a supervisor. The plaintiff, as such supervisor, was entitled to a monthly salary of Rs. 265 per month consisting of basic wages and dearness allowance. The plaintiff's said appointment was terminable by a month's notice on either side.

2. On 18th January, 1960 the General Manager, Durgapur Steel Project, acting for and on behalf of the defendant, without giving the stipulated notice to the plaintiff, terminated the latter's appointment with effect from 22nd January, 1960. as such the said termination was wrongful.

3. By reason of such breach of contract on the part of the defendant the plaintiff has suffered loss and damages assessed at Rs, 50,000. The defendant has not paid any part of the said sum of Rs. 50,000 to the plaintiff in spite of demands.

4. The above is shortly the case made out in the plaint filed in this suit where the plaintiff claims a decree for Rs. 50,000 alternatively, an enquiry into the damages suffered by the plaintiff and a decree for such sum as may be found due, interest and costs,

5. In the written statement filed on behalf of the defendant it is alleged that the plaintiff was offered the said appointment subject to the condition that a satisfactory report would be received on the verification of his antecedents and the plaintiff accepted the offer of appointment subject to the said condition. The plaintiff submitted a certificate dated the 11th April, 1959 from the sub-Divisional Officer, Assansol, stating that the plaintiff was reported to bear a good moral character, on the strength of which the plaintiff was allowed to take up the said appointment. Subsequently on verification by the Police Authorities, the plaintiff's antecedents were found to be such as to render the plaintiff unsuitable for employment in the service of the Government or of a Government undertaking. In the circumstances in accordance with the condition of his appointment, the plaintiff's services were terminated with effect from 22nd January, 1960. It is admitted in the written statement that the plaintiff was not given one month's notice of termination of his appointment, but it has been denied that the dismissal of the plaintiff was wrongful. The damages alleged to have been suffered by the plaintiff has also been denied.

6. The following issues were raised at the trial:

1. Was the termination of the plaintiff's service with the defendant wrongful as alleged in paragraph 4 of the plaint ?

2. If so, did the plaintiff suffer damages assessed at Rs. 50,000 as alleged in paragraph 7 of the plaint ?

3. To what relief, if any, is the plaintiff entitled ?

7. The plaintiff has deposed de bene esse in support of his claim. His evidence is that throughout his career he had been employed either under the Government or In Government undertakings. Betweenthe years 1937 and 1954 he had been employed under the Eastern Railways at Assansol. In 1954 he was employed by the Sindri. Fertiliser Chemicals Private Ltd., at Sindri, where he continued till 2lst April, 1959. On the 8th December, 1958 he applied in writing for employment under the defendant and on 22nd April, 1959 he joined the defendant as a transport supervisor at the Bhadreshwar Jetty. The plaintiff has stated that in his service under the defendant he was entitled to leave for one month in a year and fifteen days casual leave per year.

8. The plaintiff continued working as a supervisor at Bhadreshwar Jetty till 21st January, 1960 on which date he received a communication from the General Manager, Hindustan Steel Ltd., terminating his services with effect from 22nd January, 1960. Apart from the said communication dated 18th January, 1960 the plaintiff did not receive any other notice from the defendant in respect of the termination of the services. On 22nd January, 1960 and subsequently on 25th February, 1960 the plaintiff protested in writing to the defendant against such termination of his services. The said letters dated 22nd January, i960 and 26th February, I960 written by the plaintiff to the defendant are included in the admitted brief of documents which have been marked as Ext, 'C in these proceedings. Apart from such letters the plaintiff approached Mr. K.K. Sen the then General Manager of Hindustan Steel Ltd., Durgapur Project and learnt from him that his services were terminated on account of an adverse police report against him. It is the plaintiff's evidence that such alleged reports against him were absolutely false inasmuch as the plaintiff prior to his employment by the defendant was all along either in Government service or serving under Government of India undertakings which he could not have done had there been such reports as to his antecedents.

9. Subsequent to the termination of his employment by the defendant, the plaintiff tried to secure alternative employment at various places. The first attempt was made with Hindustan Steel Ltd. Rourkela Steel Project where the plaintiff was selected; but he was told to bring a certificate from the Hindustan Steel Ltd., Durgapur Project which the plaintiff could not or did not attempt to obtain in the circumstances of the termination of his services by the defendant. The plaintiff's next attempt was with Dalmia Cement Factory near Rourkela where the plaintiff sought to join as the Chief Yard Master. But again he could not take up the post at a certificate from the previous employer was needed. The plaintiff then turned back to his next preceding employer, namely, the Sindri Fertilisers and Chemical Ltd. for re-employment, But there was no scope for the plaintiff to obtain any employment as there were no vacant posts. Lastly, the plaintiff made an attempt to join the Ganga Project at Hatidaghat in Bihar but did not succeed.

10. The plaintiff thereafter abandoned all hope of future employment and joined the Law College in Calcutta in the year 1960 and completed the law course by 1963. The plaintiff joined the Assansol Bar as a lawyer on the 31st July, 1964 and has since been practising as a lawyer. The plaintiff's evidence remains uncontradicted and unchallenged.

11. The defendant has not called any witness to give evidence nor has the defendant made any attempt to prove the alleged police report on the basis of which the defendant terminated the services of the plaintiff. In fact Mr. Jayanta Mitra appearing on behalf of the defendant practically conceded that the termination of the plaintiff's services by the defendant was wrongful. The only contention which was made on behalf of the defendant was that the plaintiff, in view of the terms and conditions of his services, was not entitled to receive anything from the defendant by way of damages except his salary for one month, namely, the period of the notice which the plaintiff would have been entitled to under the terms and conditions of his services.

12. Mr. Ajit Roy Mukherjee, appearing on behalf of the plaintiff has contended that in law the plaintiff is entitled to damages which may exceed his salary for the period of notice provided under the terms and conditions of his employment. In support of his contentionMr. Roy Mukherjee has relied upon an English case, namely, Maw v. Jones, reported in [1890] 25 Q.B. at page 107. In that case the plaintiff was bound under a deed as an apprentice to the defendant for four years. It Was provided in the deed that in the event the apprentice ''showed want of interest' in his work the master could cancel his apprenticeship by giving a week's notice. The said deed further provided that in addition the master had the usual right to terminate the services of the apprentice without any notice on the ground of misconduct. The defendant dismissed the plaintiff on the ground of misconduct and without giving any notice. At the trial it was found that the apprentice was not guilty of any misconduct, but there were good grounds to Show that the apprentice had shown want of interest and his apprenticeship could have been terminated at a week's notice. The Jury in that case were directed that they were not limited to one week's wages in assessing damages suffered by the plaintiff and in fact the Jury awarded much more.

13. Mr. Roy Mukherjee contends that the decision in Maw v. Jones is still a good law and relies on the treatise of Friedman in support of his contention. At page 495 of the book 'The Modern Law of Employment' by Friedman the law is stated as follows:

The idea is to compensate the employee for loss of his wages or salary, not to punish the employer for wrongful dismissal. Normally the damages recoverable will be the amount of wages or salary for the period of proper notice, for that amount will represent what the employee has lost by being dismissed without such, notice. Hence if the employee has been given the amount which represents his salary or wages for the period of such notice no action for wrongful dismissal will lie against the employer. However, there may be circumstances in which more may be recovered for example, if the effect of such dismissal is to make the employee's task of finding other employment more difficult.

14. Mr. Mukherjee further relies on the statement of law in the well-known book of 'The Law of Master and Servant' by Francis Releigh Batt, 5th Edition at page 262 as follows:

In cases of wrongful dismissal (as distinguished from dismissal with wages) the servant is entitled to base his claim to damages not only on the lost salary but also on any other pecuniary Joss, such as the value of board and. lodging, tips given by master's customers, share of profits additional to salary. It is submitted that the Jury is entitled to take into consideration the difficulty of getting employment; thus, although a servant is liable to dismissal by a week's notice, if he is wrongfully dismissed, the Jury may, upon proper evidence award him considerably more than a week's wages. This is a rule often overlooked and in Savage v. British India SS. Co., Wright, J., appears to have given the plaintiff twelve months salary as damages because the plaintiff was entitled to twelve months notice. But clearly the servant's damages ought not to be so limited, the master has committed a breach of contract and so ail damages naturally flowing therefrom ought to be recoverable.

15. Relying on such authorities Mr. Roy Mukherjee contends that the Court should not limit the damages in the instant case only to the salary for the notice period but the Court should treat this as a special case and award something more and the quantum of damages is to be assessed by the Court.

16. Mr. Mitra further contends that the decision in Maw v. Jones is not good law any more. It has been overruled and/or distinguished by the decision in the case Addis v. Gramophone Co. Ltd. reported in [1909] A.C. at page 488. In this case the plaintiff was employed by the defendants as manager of the business at Calcutta on salary as well as commission on the trade done. The terms of his appointment provided that he could be dismissed by six months' notice. In fact he was given six months' notice. But dung the notice period another person was appointed as his successor and the new incumbent was allowed to work in place instead of the plaintiff during the period of notice and the plaintiff was prevented from acting as manager. The plaintiff filed a suit claiming various reliefs including damages for breach of contract. He was successful in the lower Court and obtained damages assessed at six hundred pounds on account of wrongful dismissal. Bat the Court of Appeal found that there was no basis for his claim and ultimately the matter came up to be decided in the House of Lords. The House of Lords by a majority of five to be found that the plaintiff was not entitled to any damages for wrongful termination of his services except on account of arrears of his salary and commission. Lord Moreburn in his judgment laid down the law as follows:

That there was a breach of contract is quite clear. If what happened in October, 1905, did not amount to wrongful dismissal it was, at all events, a breach of the plaintiff's right to act as manager during the six months and to earn the best commission he could make....

Did what happened entitled the plaintiff to treat the breach of contract as wrongful dismissal If yes, then did he elect to treat the contract of service still comminuting

17. To my mind, it signifies nothing in the present case whether the claim is to be treated as for wrongful dismissal or not. In any case, there was a breach of contract in not allowing the plaintiff to discharge his duties as manager, and, the damages are exactly the same in either view. They are, in my opinion, the salary to which the plaintiff was entitled for the six months between October, 1905, and April, 1908, together with the commission which the Jury think he would have earned had he been allowed to manage the business himself. I cannot agree that the manners of the dismissal affects these damages. Such considerations have never been allowed to influence damages in this kind of case. An expression of Lord Coleridge, C.J., has been quoted as authority to the contrary. I doubt if the learned Lord Chief Justice so intended it. If he did, I cannot agree with him.

18. If there be a dismissal without notice the employer must pay an indemnity, but that indemnity cannot include either compensation for the injured feelings of the servant, or for the loss he may sustain from the fact that his having been dismissed of itself makes it more difficult for him to obtain fresh employment.

19. Mr. Mitra also relied upon another English case, namely, Baker v. The Dankara Ashanti Mining, reported in 20 I.L.R. at page 37. In that case the plaintiff was appointed by the defendants and was directed to proceed to his place of work in Africa and serve as a miner and prospector for twelve months at a salary of L. 30 per month with Board and Lodging or monetary equivalent. The defendants were at liberty to terminate the services of the plaintiff at any time by giving two months' notice in Writing or two months salary in lieu thereof. The defendants also agreed to provide the plaintiff free passage on the termination of the agreement. The plaintiff was dismissed and it was found at the trial that admittedly the plaintiff was wrongfully dismissed. It was held in that case that the facts were different from Maw v. Jones as there was no limitation as to the reasons of the defendants for dismissing the plaintiff and the defendants were found liable only for arrears of salary, board and lodging and two months salary in lieu of notice. It was held that the plaintiff was not entitled to get any other damages.

20. Considering all the authorities cited on behalf of the parties it appears to me that the law is well-established by now. At page 522 of Vol. 25 Halsbury's Laws of England in footnote numbered (f) where the Addis v. Gramophone Company's case has been referred to it is noted that the former case overrules the case of Maw v. Jones. In our country the matter was considered by the Supreme Court in the case of S.S. Shetty v. Bharat Nidhi Ltd. A.I.R. 1958 S.C. page 12.

21. In that case the Supreme Court quotes Chitty on Contracts with approval as follows: 'The position as it obtains in the Ordinary Law of Master and Servants is quite clear. The master who wrongfully dismisses his servant it bound to pay him such damages as will compensate him for the wrong that he has sustained. They are to be assessed by reference to the amount earned in the service wrongfully terminated and the time likely to elapse before the servant obtains another post for which he fitted. If the contract expressly provides that it is terminable upon, e.g. a month's notice, the damages will ordinarily be a month's wage ....No compensation can be claimed in respect of the injury done to the servant's feelings by the circumstances of his dismissal, nor in respect of extra difficulty of finding work resulting from those circumstances. A servant who has been wrongfully dismissed must use diligence to seek another employment and the fact that he has been offered a suitable post may be taken into account in assessing the damages.'

22. The only exception the English Law admits is where the employment furnishes either publicity or enhancement of reputation to the employee concerned and in such circumstances (as in the case of artistes; wrongful dismissal may entitle the plaintiff to obtain further damages. It is obvious that the plaintiff cannot base and has not based his claim on this ground.

23. In view of the law discussed above I am constrained to hold that in the instant case the plaintiff cannot get, by way of damages more than the amount of his salary for the period of his notice. The plaintiff is, however, entitled to receive by way of additional benefit another month's salary in lieu of his leave pay and further 15 days, salary on account of casual leave.

24. Possibly the plaintiff would have been entitled to obtain more damages had he founded his claim on the wrongful conduct of the defendant in tarnishing his reputation in recording and reiterating an incorrect and improved adverse report thereby jeopardizing his future employment. It is not open to me to award anything more to the plaintiff on the basis of a case as made out in the instant case.

25. A few words on the conduct of the defendant is a public undertaking. In a society where employment is scarce and where the ideal is a welfare State the defendant's conduct cannot be described as any thing but irresponsible and the same has resulted in uncalled for hardship to the plaintiff. During the pendency of the suit it must have been apparent to the defendant that it cannot support its case on an adverse police report and in spite of that no attempts of reparation were made.

26. In the facts and circumstances, and on the basis of the law as discussed above I answer the issues as follows:

Issue No. 1 is 'answered in the affirmative and in favour of the plaintiff.

Issue No. 2 is answered partly in favour of the plaintiff. I hold that the plaintiff is entitled to damages but not to the extent of Rs. 50,000. The plaintiff will be entitled to a month's salary in lieu of notice, a month's salary in lieu of leave pay and another 15 lays' salary in lieu of casual leave at the rate of Rs. 265 per month.

Issue No. 3-As answered in Issue No. 2.

27. There will be a decree in favour of the plaintiff for a sum of Rs. 659.50P, The plaintiff is entitled to the costs of this suit which will be allowed as between attorney and client.

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