Back
1977 Supreme(Cal) 371
High Court Of Calcutta
S.K.Datta, J.
Jogesh Chandra Chakravarty
Vs.
Union Of India
civil Rule No. 3891(w) of 1973
Decided On : Nov 24, 1977
Advocate Appeared:
Provat Kumar Mukharji, Rathindra Nath Bhattacharyya
Headnote:
WRIT - COMPANY - STATUTORY DUTY - PUBLIC UTILITY - GENERAL INSURANCE BUSINESS (NATIONALISATION) ACT, 1972 - SECTION 16 (1) - SCHEME - SERVICE OF EMPLOYEES - TERMINATION - WRIT OF MANDAMUS - STATUS - DECLARATION OF NULLITY.
Fact of the Case:
The petitioner was appointed as an Assistant Manager in the Sterling General Insurance Co. Ltd. (hereinafter also referred to as the Sterling) by a letter dated March 17, 1971 with effect from April 1, 1971, by way of "contractual appointment," for a period of 3 years ending on the 31st march, 1974. The letter of appointment provided that on the expiry of the contract period i. e. March 31, 1974 the petitioner's service would stand automatically terminated unless renewed by mutual agreement on terms as would be agreed upon. It was further provided that either party would be entitled to terminate the employment by a month's notice in writing or on payment of month's salary in lieu thereof. The employer reserved his right to terminate the service without notice at any time on ground of misconduct, gross negligence, absence from duty without permission, breach of discipline etc. While the petitioner was working in the company on the basis of the said contract of service he was served with a notice dated February 27, 1973 informing him that his appointment in contractual basis shall stand terminated on 31st March, 1973. The petitioner challenged the legal validity of the said letter and was informed by the company that the decision for termination of the contract of appointment had been taken in accordance with the general directive received from the General Insurance corporation of India the respondent no. 5 herein.
Finding of the Court:
The termination of service of the petitioner was apparently on the basis of a month's notice as per contract of employment, though it could not be so on account of delayed service. The real reason for such termination was expressly stated in the first sentence of the letter of termination which was the crossing of age of sixty years by the petitioner in variation of the terms of contract of service which did not provide for superannuation. Such termination cannot be accepted as a simpliciter termination on a month's notice according to contract and it finds support in the letter of March 17, 1973 issued by the Sterling General insurance Co. Ltd. on the representation of the petitioner. The letter states: the decision of termination of your contract appointment has been taken in accordance with the general directive received from the General Insurance Corporation. " the letter candidly states that the, termination was made in accordance with the provision to that effect in the contract which was kept for exercise in cases where necessary though in the same letter there was appreciation of the petitioner's service. The directive stated to have been issued by the corporation was however not produced before the court.
Issues: 1. Whether a writ can be issued against a company incorporated under the Companies Act, 1956? 2. Whether the petitioner had a statutory status in respect of his service? 3. Whether the termination of the petitioner's service was in breach of the conditions of service?
Ratio Decidendi: 1. A writ may issue against a public utility, even though it is a company, commanding it to perform its duties in discharge of its functions under the statute regulating such functions. If an employee is given by the Act and the scheme framed thereunder by the Central Government, a statutory guarantee in respect of his service in the transferee company converting his service beyond the scope of contract to status, there is no reason, as it appears, why, in absence of any other remedy, under the relevant statute, the aggrieved employee will not be entitled to mere the High Court under Article 226 of the Constitution for issue of appropriate writ commanding the company to perform its statutory obligations, putting the relationship between the parties back to rails. 2. The petitioner did not have a statutory status in respect of his service at the time of termination. 3. The termination of the petitioner's service was in breach of the conditions of service.
Final Decision: The Rule accordingly fails and is discharged. There will no order as to costs in the circumstances and all interim orders if any are vacated. Rule discharged.
1. THE petitioner was appointed as an assistant Manager, Calcutta in the sterling General Insurance Co. Ltd (hereinafter also referred to as the sterling) by a letter dated March 17, 1971 with effect from April 1, 1971, by way of "contractual appointment," for a period of 3 years ending on the 31st march, 1974. The letter of appointment provided that on the expiry of the contract period i. e. March 31, 1974 the petitioner's service would stand automatically terminated unless renewed by mutual agreement on terms as would be agreed upon. It was further provided that either party would be entitled to terminate the employment by a month's notice in writing or on payment of month's salary in lieu thereof. The employer reserved his right to terminate the service without notice at any time on ground of misconduct, gross negligence, absence from duty without permission, breach of discipline etc.
2. WHILE the petitioner was working in the company on the basis of the said contract of service he was served with the following notice dated February 27, 1973.
"as you are aware you have crossed the age of 60 years. This is to inform you that your appointment in contractual basis shall stand terminated on 31st March, 1973. This letter may therefore, be treated as a notice of termination of your contractual appointment you will be relieved on 31st March, 1973 and your dues will be settled as on that date. "
This letter was received by the petitioner on March 5, 1973. The petitioner challenged the legal validity of the said letter and was informed by the company that the decision for termination of the contract of appointment had been taken in accordance with the general directive received from the General Insurance corporation of India the respondent no. 5 herein.
The petitioner thereafter moved this Court by an application under article 226 of the Constitution contending that in view of the legislation relating to nationalisation of the general insurance business in India, he was conferred a statutory status which did not provide for superannuation; further the order was malafide and was passed in violation of the provisions of Articles 14 and 16 of the Constitution. On this application this Court issued a rule on September 24, 1973 but no interim order was granted. The Rule was opposed by the Respondent No. 4, the Senior Regional Manager of the oriental Fire and General Insurance Co. Ltd. unit Sterling and it was disclosed in his affidavit-in-opposition that the sterling General Insurance Co., ltd. ceased to exist as its right, title and interest had vested in the Oriental Fire and General insurance Co. Ltd., (hereinafter also referred to as "oriental") under the provisions of the General Insurance business (Nationalisation) Act, (Act 57 of 1972. It was stated that no writ lay against an existing company and the petitioner's service was duly terminated in accordance with terms of his contract of service while there was no infringement of any statutory right of the petitioner. The petitioner's service, it was further stated was terminated on one month's notice as provided in the contract of service, "in pursuance of the general directives issued by the General Insurance corporation" for effecting efficiency and proper running of the administration. It was also stated that a cheque for Rs. 5463. 18 p. was sent to the petitioner in full satisfaction of his dues which was however returned as it was stated that the petitioner had already taken recourse to legal proceedings for obtaining necessary relief. Further it was submitted that in any event the Petitioner's service automatically stood terminated on March 31, 1974 and the Rule accordingly has become in fructuous.
3. THE petitioner thereafter made an application for addition of the oriental as a party to the proceeding as respondent No. 6 was duly allowed. The petitioner also filed an affidavit-in-reply reiterating the contentions made by him in his petition of motion.
4. BEFORE we proc
