IN THE HIGH COURT OF DELHI AT NEW DELHI
VALMIKI J.MEHTA, J.
SDU TRAVELS PVT. LTD. - Appellant
Versus
VIPIN SHARMA - Respondent
FAO No. 134/2017
Decided On : 04-05-2017
CPC - Private Employment - Section 14 of the Specific Relief Act, 1963 - Sections 14(1)(c) and 41(e) of the Specific Relief Act - The court discussed the applicability of the principles of administrative law/public law to private employment and the entitlement of an employee in case of illegal termination. The court referred to the judgments in Shri L.M. Khosla Vs. Thai Airways International Public Company Limited and Anr, 2012 SCC Online Delhi 4019, Satya Narain Garg, through his Legal heirs Vs. DCM Limited and Ors. 187 (2012) DLT 25, GE Capital Transportation Financial Services Limited Vs. Shri Tarun Bhargava, 190 (2012) DLT 185 and Shri Naresh Kumar Vs. Shri Hiroshi Maniwa and Ors., 224 (2015) DLT 586 to establish that in private employment, the employee is entitled to damages for illegal termination, not continuation of service.
Fact of the Case:
The respondent/plaintiff filed a suit seeking continuation of services as a Grade M2 Manager after the appellant/defendant terminated the employment. The trial court allowed the application under Order XXXIX Rule 1 and 2 CPC filed by the respondent/plaintiff, directing continuation of service in private employment.
Finding of the Court:
The court found that in private employment, contracts of personal service are not enforceable, and the maximum entitlement of an employee in case of illegal termination is for damages, not continuation of service. The court held that the trial court committed illegality in granting the interim injunction and final relief by way of an interim order.
Issues: The issues revolved around the termination of private employment and the entitlement of the employee in case of illegal termination.
Ratio Decidendi: The court established that in private employment, the employee is entitled to damages for illegal termination, not continuation of service, as per Section 14 of the Specific Relief Act, 1963. The court also emphasized that injunctions cannot be granted to direct continuation of a contract which is determinable.
Final Decision: The appeal was allowed, the impugned order was set aside, and the interim injunction application filed by the respondent/plaintiff was dismissed. Parties were left to bear their own costs.
VALMIKI J. MEHTA, J.
1. This first appeal under Order XLIII Rule (1)(r) of the Code of Civil Procedure, 1908 (CPC) is filed by the defendant in the suit against the impugned order dated 14.3.2017 by which the trial court has allowed the application under Order XXXIX Rule 1 and 2 CPC filed by the respondent/plaintiff. By allowing the application, effectively, the trial court has directed continuation of service in private employment of the respondent/plaintiff with the appellant/defendant. The operative portion of the impugned order dated 14.3.2017 is not happily worded, however, the effect of the impugned order is not only to continue contract of private employment inspite of the same being terminable by a three months notice period, the impugned order also results in granting of the final relief by way of impugned interim order:-
“In consideration of above, the defendant is directed to conduct proper inquiry as per clause 22 of the appointment letter. It is also to be noted that subsequent to e-mail dated 17.02.2017 by the defendant, there is another e-mail dated 04.03.2017 intending to terminate the employment henceforth on payment of salary for three months. Both the e-mails above, which would cast misconduct on the plaintiff cannot be made operative without following clause 22 of the appointment letter as rights of the plaintiff would be prejudiced. A prima-facie case is made out in favour of the plaintiff, therefore, the operation of the notices are stayed and the defendant is directed to follow the procedure as per the terms and clauses of the appointment letter.
In view of above discussion, application under Order XXXIX Rule 1 & 2 CPC disposed off and nothing herein shall tantamount to my expression of opinion on merits of the case.
In consideration of above, written statement be filed within three weeks with copies exchange. Put up for filing of replication, original documents, admission-denial of documents and framing of issues on 27.04.2017.
(Ms. Vineeta Goyal)
ADJ-03(South)/Saket/New Delhi
14.03.2017”
2. The subject suit was filed by the respondent/plaintiff for declaration, mandatory injunction and permanent injunction seeking continuation of the respondent’s/plaintiff’s services as a Grade M2 Manager. The issue in the suit was a challenge by the respondent/plaintiff to the termination of services of the respondent/plaintiff by the appellant’s/defendant’s e-mail dated 17.2.2017 as also by another e-mail dated 4.3.2017. The relief clauses of the suit filed by the respondent/plaintiff read as under:-
“(a) Pass a decree of declaration, in favour of the Plaintiff and against the Defendant thereby declaring the notice dated 17.02.2017 and notice dated 04.03.2017 to be illegal, Null and Void, non-est and having no sanctity in law and not binding on the Plaintiff;
(b) Pass a decree of Mandatory injunction in favour of the Plaintiff and against the Defendant terminating the services of the Plaintiff from the defendant company and reinstate the Plaintiff to the post enjoyed by the Plaintiff before the notice dated 17.02.2017 and 04.03.2017 was send to the Plaintiff.
(c) Pass a decree of permanent injunction in favour of the Plaintiff and against the Defendant terminating the services of the Plaintiff from the defendant company and reinstate the Plaintiff to the post enjoyed by the Plaintiff before the notice dated 17.02.2017 and 04.03.2017 was send to the Plaintiff.
(d) Cost of litigation to be paid to the plaintiff
(e) Pass any other or further relief, in favour of the Plaintiff and against the defendants, which this Court deem fit and proper, in the facts and circumstances of the case.”
3. There is no dispute that the contract between the parties is a contract of private employment i.e a contract is not a contract of public employment i.e a contract of the respondent/plaintiff offering any services to an entity which is a State under Article 12 of the Constitution of India. With respect to private contracts of personal servic
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