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Arun Tandon Vs. Insurance Co. Ltd. and ors. - Court Judgment

LegalCrystal Citation
SubjectCriminal
CourtJammu and Kashmir High Court
Decided On
Judge
Reported in1983CriLJ459
AppellantArun Tandon
Respondentinsurance Co. Ltd. and ors.
Cases Referred and Ajay Hasia v. Khalid Majid
Excerpt:
- .....having conducted insurance business up to the mark a right had accrued in his favour to hold the post of inspector substantively; thirdly, that the order is actuated by malice; and fourthly, that it is violative of article 311 of the constitution.4. this writ petition was filed at srinagar. hon'ble the acting chief justice, before whom it came hp for admission, passed the following order or 22-12-1981:issue notice to the respondents to show cause why the petition be not admitted. the petition shall be transferred for hearing to the jammu wing. alongside, the petitioner had also made an application being cmp no, 1020/1981, for staying the implementation of the impugned order, on which too the following order came to be passed on the said date:issue notice. till further orders from this.....
Judgment:
ORDER

I.K. Kotwal, J.

1. The petitioner, Arun Kumar Tandon. was on the clerical staff of the National Insurance Company Limited, respondent No. 1 herein, when on April 29, 1976, the Central Government floated a scheme known as General Insurance (Rationalisation of Pay Scales and other Conditions of Service of Development Staff) Scheme, 1976, providing for conversion of the clerical staff into Development staff. This scheme laid down the procedure for categorisation of Development Staff and their emoluments and other perquisites besides leave. Provident Fund and Gratuity, Para 11 of the scheme provided that every person employed with the Development, Staff shall maintain his cost ratio within the limits stipulated in Sub-clause (b) of Clause (17) of Para. 3. According to Clause (17) an Inspector operating in a city other than Bombay, Calcutta, Madras, or other A-Class or B-1 and B-2 Class cities was bound to maintain cost ratio up to the maximum limit of 12'/2%,

2. Pursuant to this scheme the Assistant Manager of Insurance Company, respondent No. 2 herein, addressed a letter to the petitioner on 13-7-1978, that in case he accepted the conditions of service set out therein, he shall be appointed as a probationary Inspector with effect from 1-1-1978. Some of the conditions stated therein, which alone are relevant for the present discussion, read as below:

1. (a) You shall be on probation with effect from 1-1-1978 for a period of on year which can be extended by the Appointing Authority at his discretion for a period not exceeding six months.

X X X X X(b) You shall not be confirmed in the cadre of Development Staff unless you have passed the Licentiate examination before conversion or during the probationary period or the extended probationary period.

III. Cost control during the period of probation:

With the total emoluments payable to you in terms of Paragraph II you shall procure that much premium income during the probationary period or the extended probationary period which would enable you to ensure that the cost ratio computed as a percentage of the total emoluments paid during the probationary period or the extended probationary period to the 'Scheduled Premium Income' procured by you during the said period, shall not exceed the following limits.

Place of posting Maximum limit for Cost-ratio: --------------------------------------------------1) Metropolitan cities (Bombay,Calcutta, Madras and NewDelhi) 9 1/2%2) 'A' Class cities (other thanBombay, Calcutta. Madras and New Delhi) and B1 and B3 class cities 10 1/2%3) Other centres 12 1/2%V. Revised and determination of targets of scheduled premium income.

Your performance during the probationary period or the extended probationary period shall be reviewed half-yearly. The Authority may revert you to your previous cadre in the clerical grade in the event of unsatisfactory performance.

VI. Lien during the period of probation:

On the expiry of the probationary period or the extended probationary period, unless an express order in writing, confirming you as a Development Staff is issued you shall not be deemed to have been confirmed as an Inspector and you shall be reverted to your original position in the clerical cadre.

During the period of probation or extended probationary period you shall have a lien over your previous post of the clerical cadre. You shall be at liberty to go back to the clerical cadre and company shall also have an option to revert you to the clerical cadre without assigning any reasons.

X X X X XVII. Fitment of absorption of successful completion of probationary period:

On your fulfilling the premium target as per Para. - IV above and on your passing the Licentiate Examination of the Federation of Insurances Institutes of India during the probationary period or the extended probationary period you shall be confirmed in the Development Staff Cadre and you shall be fitted into the scale of Rs. 250-15-295-20-375-25-552-30-675-35-850 at the stage at which the present emoluments payable to you in terms of Para II above in equivalent to gross emoluments (as defined in the General Insurance Rationalisation of Pay Scales and other Conditions of Service of Development Staff Scheme 1976) in the above scale and if the present emoluments are not equivalent to the stage in the scale, at the stage next above in the said relevant scale.

3. The petitioner, on 29-7-1978 accepted all the conditions unreservedly by writing back : 'I accept all the terms and conditions stated in this letter'. He continued working on the Development Staff as an Inspector when on 25-8-1980 he was placed under suspension by the Divisional Manager, respondent No. 3 herein, pending enquiry into a charge of criminal misappropriation against him. Ultimately, respondent No. 1 by his order dated 18-8-1981, reverted him to former cadre of Assistant in the Clerical staff by saying that his performance as Inspector had been unsatisfactory during his probationary period. Through the medium of this writ petition, the petitioner has challenged the aforesaid order of his reversion on the grounds : firstly, that it, has been passed at his back without giving him a prior hearing and is, therefore, violative of the principles of natural justice; secondly, that he having passed the Licentiate examination and also having conducted insurance business up to the mark a right had accrued in his favour to hold the post of Inspector substantively; thirdly, that the order is actuated by malice; and fourthly, that it is violative of Article 311 of the Constitution.

4. This writ petition was filed at Srinagar. Hon'ble the Acting Chief Justice, before whom it came HP for admission, passed the following order or 22-12-1981:

Issue notice to the respondents to show cause why the petition be not admitted. The petition shall be transferred for hearing to the Jammu Wing.

Alongside, the petitioner had also made an application being CMP No, 1020/1981, for staying the implementation of the impugned order, on which too the following order came to be passed on the said date:

Issue notice. Till further orders from this Court, the petitioner unless already reverted shall not be relieved from the post of Inspector The petition shall be transferred for hearing to the Jammu Wing.

5. The petitioner then moved an application for contempt against respondent No. 4 alone on 25-2-1982 alleging that the latter had defied the Court order by stopping the petitioner's pay from 22-12-1981 onwards. This is Contempt Petition No. 6/82. On this, rule nisi was issued to respondent No. 4 on 27-2-1982 and objections on his behalf are yet to be filed in it.

6. The petitioner made yet another application on 15-4-1982; this time against all the respondents with a composite prayer that they be directed to release his pay due from 22-12-1981 on-words and be not granted any hearing in the case till they are purged of the contempt. This is CMP No. 446/82. On this, Hon'ble the Acting Chief Justice passed the following order on the same day:

Issue notice to the respondents. In the meantime the respondents are directed to deposit within two weeks in the Registry at Jammu arrear salary due to the petitioner from 22-12-1981. The amount, shall not, however, be disbursed to the petitioner till further orders from the Court.

Pursuant to the show cause notice, the respondents appeared in the Court and filed their counter-affidavit in the writ petition. Their case is that the petitioner had no right to hold the post of Inspector and that he has been rightly reverted to his original post of Assistant, as his performance during his probationary period was found unsatisfactory. His business had a gradual decline whereas there was a constant rise in the cost ratio of his work. He, under the terms of the contract of his employment, had no right of a prior hearing, even though the fact that there was a constant shortfall in the business and a constant rise in the cost ratio was brought to his notice more than once, to which no heed was paid by him, There is absolutely no truth in his allegation of mala fides and he being an employee of an Insurance Company, Article 311 of the Constitution is not applicable to his case. The respondents have also made an application seeking vacation of the stay order issued by the Court on 22-12-1981 alleging that the same has been obtained by him by sheer misrepresentation of facts, as he had been relieved from his post long before the order came to be issued. This is CMP No. 22/82.

7. Mr. Sawhney, the learned Counsel for the petitioner, raised a preliminary point that the respondents had no right to be heard, unless they first purged the contempt for which rule nisi was issued to them on 27-2-1982 in Contempt Petition No. 6/82. For this, he relied upon Hadkinson v. Hadkinson 1952 (2) All ER 567; Dr. Madan Gopal Gupta v. Agra University : AIR1974All39 , and C. M. P. No. 293 of 1981 titled Mehraj-ud-Din v. Peer Ahmed Ullah decided by a Division Bench of this Court on 28-10-1981. The first two authorities no doubt say that before a party to a litigation may be heard in support of its case, it must purge itself of the contempt that tends to impede the course of justice. But, the contempt of which these authorities speak is admitted or proved contempt and not merely an alleged contempt. Even otherwise also, refusing a right of hearing to a party against whom merely a notice for contempt has been issued, is fraught with grave injustice, for, the other party by merely levelling a false charge of contempt against it and thereby inducing the Court to issue rule nisi against it, may have it condemned unheard. What will happen if a party levels a false charge of contempt against its opponent and thus persuade the court to issue a notice for contempt against him, the court refuses to hear the alleged contemned and on an ex parte version also grants relief to it before the charge of contempt is eventually found baseless on the conclusion of the enquiry? Mr. Sawhney, placed in this predicament, argued that in order to obviate any injustice, the main proceedings shall have to be stayed till the issue of contempt is finally disposed of. Even this is no cure. What will happen where a notice for admission and stay in a writ petition, for example, is issued by the Court in a matter of urgent nature, the respondent feels that if the implementation of the impugned order is not stayed forthwith, the writ petition will become anfractuous, and with this object in view, he commits a deliberate contempt of Court and then asks it to stay further proceedings in the main writ petition till the contempt matter is finally disposed of? Will such a course not result in grave injustice to the writ petitioner? And if the matter is left entirely to the discretion of the Court, whether or not to stay the main proceedings, when shall the court stay them, and when not and for what reasons? Judging from any angle, therefore, the contempt that has to be purged is admitted or proved contempt and not merely an alleged contempt. This is also the view taken in 1952 (2) All ER 567, (supra) and : AIR1974All39 (supra). From the Division Bench authority of this Court it is not revealed whether it was a case of proved or admitted contempt or of a merely alleged contempt. That apart, even if Mr. Sawhney's argument were to be accepted in toto still notice of contempt having been issued to respondent No. 4 alone right of hearing could not be refused to the other respondents. I. therefore, heard Mr. Mirdul as well.

8. The order passed by respondent No. 1 reverting the petitioner to the clerical post, was even though administrative in character, yet, there can be no manner of doubt, it entailed civil consequences, which ordinarily required the observance of rules of natural justice. But, as held by their Lordships in the New Prakash Transport Co. Ltd. v. New Suwarna Transport Co. Ltd. : [1957]1SCR98 : 'the rules of natural justice vary with the varying constitutions of statutory bodies and the rule prescribed by the Act under which they function and the question whether or not any rules of natural justice have been contravened shall be decided not by any preconceived notion but in the light of the statutory rules and provisions.

9. For applying this rule to the present case, we shall have to look into the conditions of service communicated to the petitioner by respondent No. 2 by his letter dated 13-7-1978 and accepted by the latter on 29-7-1979. Under Condition No, VI the petitioner could be reverted to his original position in a clerical cadre in case he was not expressly confirmed as an Inspector by an order in writing, mere length of service as a probationer could not confer on him the right to hold the post substantively. His employer could revert him during the period of probation even without assigning any reason. This para does not speak of reverting the petitioner except by serving a prior notice on him. Notwithstanding that, it is in the counter-affidavit of the respondents that more than once the petitioner's attention was invited to the fact that his work was not satisfactory, but he did not pay any heed to it. This, in any case, was a sufficient compliance with the rules of natural justice.

10. Nor are the provisions of Article 311 applicable to the petitioner's case. Assuming, though not granting, that the Insurance Company of which the petitioner is an employee, is a Government agency and, therefore, an authority within the meaning of Article 12 still its employees cannot have the status of Government employees to attract the provisions of Article 311. This point is no more res integra. (Sukhdev v. Bhagat Ram : (1975)ILLJ399SC , and Ajay Hasia v. Khalid Majid : (1981)ILLJ103SC ),

11. Equally untenable is the petitioner's contention that he had acquired a substantive right to hold the post of Inspector because he had passed the Licentiate examination and had conducted insurance business up to the required limit to satisfy the requirements of Condition No. VII, He, as the impugned order itself shows, was reverted on account of unsatisfactory work. The respondents have produced a chart of his business performance right from the year 1978 when he was appointed as a probationary Inspector up to the year 1981 which reads as under:

'BUSINESS PERFORMANACE OF SH. ARUN TANDAN---------------------------------------------------------------Gross Non Tradl. Adjusted Cost%Premium Premium Premium---------------------------------------------------------------1978 1,32,416 6,299 1,32,418 11.041979 1,05.791 3,522 89,313 15.091980 97,456 8,506 96,052 16.401981 44,868 834 ... ...---------------------------------------------------------------

12. It is quite obvious from this chart that his business was gradually decreasing and his cost ratio gradually increasing. It could not be, therefore, said to be satisfactory business. He contends that this statement excludes the business conducted on his behalf by his agent, but the respondents contend that the said agent did his business independently and was also given credit for it. This Court in its writ jurisdiction is not competent to record a finding of fact on the point after taking evidence. If that be so, as in fact it is, then the petitioner cannot be heard to say that his work as a probationer was satisfactory which entitled him to hold the post substantively.

13. Coming now to the last plea of mala fides, suffice it to say that no foundation has been laid for it in the Writ petition by pleading necessary facts. This plea appears to have been raised as a last resort. In the absence of necessary material to substantiate the same, the plea cannot be taken into consideration.

14. All the grounds urged in support of the petition having failed, the petition also fails, which is dismissed in limine accordingly, but in the circumstances of the case without any order as to costs.

15. The stay order issued by the court on 22-12-1981' in CMP No. 1020/81 as well as the order issued by it on 15-4-82 in CMP No. 446/82 shall also stand vacated.


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