Hindustan Lever Ltd. v. Hindustan Lever Mazdoor Sabha
1975-09-05
PRODYOT KUMAR BANERJEE
body1975
DigiLaw.ai
JUDGMENT This rule is directed against an order passed by the learned Judge, City Civil Court, Calcutta, holding that the suit filed by the opposite party is maintainable. 2. Mr. Roy Mukherjee on behalf of the petitioner contended, inter-alia, that the suit is not maintainable as the prayer is for the enforcement of a contract of personal service by the plaintiffs. The opposite parties, a trade union and a workman filed the suit in the City Civil Court, Calcutta alleging inter alia, that the petitioner company's work, administration and business were divided into 3 divisions, namely, Soap's division, Toilets preparation divisions and Foods division. In 1966 the management of the defendant company on the plea of reorganisation wrongfully and without complying with the mandatory provisions of law decided to introduce a system of two divisional working instead of the then prevailing three-divisional working. The proposed two divisions were the main lines divisions and speciality lines division. The said proposed changes by introduction of the two divisional systems adversely affected the conditions of service of the employees of the defendant company. Against the said two divisional system an industrial dispute cropped up on the issue whether the said changes introduced by the management in the name of reorganisation were justified and the matter was referred to the 3rd Industrial Tribunal by the Government of West Bengal. In the said Reference, it is alleged, seven applications were filed by seven workmen under section 33A of the Industrial Disputes Act which were disposed of by the Third Industrial Tribunal, West Bengal by an Award dated 23rd March, 1967. Thereafter the company appealed before the Supreme Court of India against the said Award given by the Third Industrial Tribunal, West Bengal on 23rd March, 1967 and those appeals are still pending.
Thereafter the company appealed before the Supreme Court of India against the said Award given by the Third Industrial Tribunal, West Bengal on 23rd March, 1967 and those appeals are still pending. In the said appeals pending before the Supreme Court, the company gave the following undertakings :– a) The number of employees in any category affected by the Reorganisation has not been and will not be reduced during the pendency of the appeals before the Honourable Supreme Court of India ; b) Each workmen will be gainfully employed and the terms and conditions for each workmen will remain the same as on the pre-reorganisation basis ; c) The management of the defendant company will not contend before any Court or Tribunal that the Union is stopped from challenging the merits of the Reorganisation on the ground of commencement of work by non-working employees or Reorganised basis". It is stated that in view of the undertaking given by the company, the company must follow the undertaking given before the Supreme Court and as such they cannot change the conditions of the service of the employees to their detriment. On 5th January, 1971 the management of the defendant company put into circulation a cyclostyled manual of instructions along with various cyclostyled and/or printed forms, and called upon the workers and employees to act according to the said instructions and forms on and from 12th March, 1971. In the said manual of instructions, the management of the defendant company has given the following reasons for introduction of the instructions and forms in the working of various departments of the company :– a) To introduce standard procedure between all despatch points, factories, depots and C. & F. S. ; b) To fall in line in the company's Information Reporting Practices which are now by private centres ; c) To improve control over inventory and damaged stocks". It is alleged that the introduction of these forms will change the condition of service of the employees to their detriment and increase the workload of each employee of the Departments and/ or Centres affected by the proposed scheme.
It is alleged that the introduction of these forms will change the condition of service of the employees to their detriment and increase the workload of each employee of the Departments and/ or Centres affected by the proposed scheme. It is alleged that this change was introduced with the ulterior object of increasing the work load of the employees and ultimately with the illegal and ulterior object of dispensing with human agency by Substituting the same with Electronic Computers by reducing, if not totally eliminating, the employment potentiality of and in the defendant company. On the basis of these allegations, the plaintiffs claimed relief in the following terms :– "a) Perpetual injunction restraining the defendant company, its servants and agents from giving effect to or acting upon the new manual of instructions and/ or directions in respect of the proposed changes as mentioned in the (Packed Stock and accounting, new forms) and /or the Manual of Instructions and/ or the new printed Forms issued by and/ or under the authority of the defendant company on the 22nd January, 1971 ; b) Perpetual injunction restraining the defendant company its servants and agents from, in any manner, interfering with the service conditions prevailing at the time when the solemn undertaking pleaded in paragraph 3 of the plaint was given on behalf of the defendant company before the Honourable Supreme Court of India ; c) Further injunction in such other terms and to such other effect as may be deemed necessary in the facts and circumstances of this case ; d) Costs." Affidavit has been filed by the opposite parties, inter alia, stating that since the filing of the suit the said appeals were disposed of by the Supreme Court. After the determination of the appeals by the Supreme Court, the plaintiffs prayed for an amendment of the plaint which was allowed and by which paragraphs 3A, 3B, 3C and 5 were added. It is pleaded in the added paragraphs that even before the said undertakings to the Supreme Court, the company gave an assurance to the Union not to reduce the number of employees in any category or of any branch and further not to alter the terms and conditions of service of the workmen to their detriment.
It is pleaded in the added paragraphs that even before the said undertakings to the Supreme Court, the company gave an assurance to the Union not to reduce the number of employees in any category or of any branch and further not to alter the terms and conditions of service of the workmen to their detriment. After the amendment, the facts remain that the opposite party's case was based on the assurance given before the Supreme Court as also the assurance given by the Company to the employees Union that they will not alter the terms and conditions of the service of the workmen to their detriment. 3. On this pleading the petitioner contended that the suit is not maintainable as the suit is not the enforcement of the personal service. The opposite party however contended that this is not a case of enforcement of the personal service and the suit is maintainable. The learned Judge, City Civil Court, having held against the defendant, the petitioner challenges the finding about the maintainability in the present proceeding. 4. Before I deal with the question raised, it is convenient for me to consider the effect of the Supreme Court's decision in Civil Appeal Nos. 675-681 of 1967 and No. 1759 of 1971 decided on 7th March, 1973. The company's decision regarding marketing organisation of the Calcutta Branch of the company on 30th September, 1956 was referred by the Government of West Bengal to the 3rd Industrial Tribunal for adjudication of the question namely, "Is the human rationalization as a measure of economic reorganisation of the company reflected through job-integration that have either been effected or proposed to be effected justified ?" Pending the adjudication of this issue, seven workers filed applications under section 33A of the Industrial Disputes Act before the same Tribunal alleging that during the pendency of the adjudication their service conditions had been changed adversely and their salary for the month of October, 1966 had not been paid. The Tribunal held in favour of the workers and passed its award on 23rd March, 1967. By Special leave granted by Supreme Court the employer filed appeals, viz. Civil Appeal Nos. 675-681 of 1967 against the said awards.
The Tribunal held in favour of the workers and passed its award on 23rd March, 1967. By Special leave granted by Supreme Court the employer filed appeals, viz. Civil Appeal Nos. 675-681 of 1967 against the said awards. The main reference was finally disposed of on 11th August, 1969 by the same Tribunal holding in favour of the employer and the workers filed their Civil Appeal No. 1759 of 1971 against the said award by Special leave granted by the Supreme Court. Both the, appeals were disposed of by the Supreme Court by the same judgment in Civil Appeal No. 1759 of 1971. It has been held that the employer has jurisdiction to change the conditions of service and the employer has the right to reorganise his work in the manner he pleases. It has been held that the company has a right to reorganise its departments in order to meet the challenge of change in marketing conditions. In the company's appeal also the Supreme Court upheld the awards passed in favour of the workmen, inter alia, holding that non-payment of wages in the circumstances of the case amounted to an alteration in the conditions of service and the fact that the scheme was introduced before the reference under section 10 was made did not bar an application under section 33A and that the Tribunal was justified in coming to the conclusion that the alteration in the condition of service could not have been made without notice under section 9A. There was an appeal by the workmen against the award upholding the reorganisation and appeals by the employer against the orders under section 33A. The Supreme Court held on the basis of the evidence adduced before the Tribunal that both the awards must be upheld. 5. Mr. Roy Mukherjee on behalf of the petitioner argued that the plaintiffs in the suit sought to enforce the terms of a contract of personal service and as such the suit is barred under sections 41 and 14 of the Specific Relief Act. 6. Mr. P. K. Chatterjee on behalf of the opposite party contended that neither section 14 (b), (c) and (d) of the Act nor section 41 of the Specific Relief Act was applicable in this facts of the present case. It is stated that section 38 of the Specific Relief Act is applicable in the present case.
6. Mr. P. K. Chatterjee on behalf of the opposite party contended that neither section 14 (b), (c) and (d) of the Act nor section 41 of the Specific Relief Act was applicable in this facts of the present case. It is stated that section 38 of the Specific Relief Act is applicable in the present case. It is argued by Mr. Chatterjee that the plaintiff is trying to prevent the breach of existing terms in their favour arising out of the assurance given by the company and the breach cannot be compensated in money. Mr. Chatterjee further contended that, assuming but not admitting that section 14 (b) is a bar the question cannot be decided at this stage as no fact is before the Court at the present moment and it can only be decided after the evidence is adduced. It is further contended that section 41 of the Specific Relief Act provides for the prevention of continuing breach of the employer. Mr. Chatterjee contended that section 14 only applies when there is termination or removal from service. That is not the fact in the present case. Therefore it is contended that section 14 of the Act has no application. 7. It is well-known that under the Specific Relief Act, a contract for personal service cannot be enforced in a suit and section 14 bars such suit. Mr. Chatterjee contended that the frame of the suit does not come within the mischief of the Specific Relief Act. It is argued that the defendant company assured the plaintiff about the contract of service, that there would not be any reorganisation. Mr. Chatterjee contended that the bar under section 14(b) of the Specific Relief Act applies only in respect of the termination of service and all the cases which have been cited are cases of termination of service and not one of the present nature. It is argued by Mr. Chatterjee that section 14(b) of the Specific Relief Act has no application unless there is a termination of service. In my opinion, this contention of Mr. Chatterjee cannot be accepted to be correct. There is no doubt that all the cases cited at the Bar relate to cases of termination of service but section 14(1)(b) of the Act makes it clear that its provision does not relate to only termination of service.
In my opinion, this contention of Mr. Chatterjee cannot be accepted to be correct. There is no doubt that all the cases cited at the Bar relate to cases of termination of service but section 14(1)(b) of the Act makes it clear that its provision does not relate to only termination of service. Secti0n 14(1)(b) of the Act bars the specific performance of a contract which runs into such minute or numerous details or which is so dependent on the personal qualifications or volition of the parties, or otherwise from its nature is such, that the Court cannot enforce specific performance of its material terms. Section 14(1)(b) of the Act applies to a contract which runs into such minute or numerous details that the Court cannot enforce specific performance of it. The contract of employment regarding how the employer will have his work done by his employees comes within the mischief of section 14(1)(b) of the Act. It amounts to a contract which runs into minute and numerous details relating to the duties of the workmen vis-a-vis the employer. The employer has no doubt the right to reorganise the working of its company for the purpose of getting the best results in the best available way. Section 14 cannot, in my opinion, be limited to the case of termination of service only. If that was so, the words "contract which runs into such minute or numerous details or otherwise from its nature is such, that it..." would not have been there in the section itself. Contract of employment is included in the words "which is so dependent on the personal qualifications of the parties". The suit, in my opinion, also comes within the mischief of section 14(1)(c) of the Act. Section 14(1)(c) relates to a contract which is in its nature determinable. There is no doubt that the employer has a right to determine the contract between the parties, if any. The contract in the present case is a contract of service and it is determinable by the employer. In the substance, therefore, the suit is barred under section 14(1)(b) and (c) of the Specific Relief Act. 8. Mr. Chatterjee contended that the bar of section 14 of the Specific Relief Act can only be agitated if the plaintiffs could be compensated with money for the breach of the agreement. Section 14(1)(b) does not, however, say so.
In the substance, therefore, the suit is barred under section 14(1)(b) and (c) of the Specific Relief Act. 8. Mr. Chatterjee contended that the bar of section 14 of the Specific Relief Act can only be agitated if the plaintiffs could be compensated with money for the breach of the agreement. Section 14(1)(b) does not, however, say so. Under section 14(1)(a), a contract, the non-performance of which can be adequately compensated by money, cannot be enforced specifically. In section 14(1)(b) reference to relief by way of compensation is totally absent Section 14(1)(b) or (c) does not speak of adequate compensation. In the present case, it appears to me on the face of the plaint itself that the plaintiff is trying to whittle down the defendant's right to reorganise their department in a way they like or trying to enforce a contract alleged to have been entered into by the plaintiff with the defendant as to how the employer will deal with the terms of service of his employees. In my opinion, this comes within the mischief of section 14(1)(b) of the Specific Relief Act and is not maintainable in Courts. Whether they can be agitated as an industrial dispute is a different matter with which I am not concerned in the present proceeding. Mr. Chatterjee contended that in the proceeding under Order 14, Rule 2 of the Civil Procedure Code no question of fact can be raised, assuming section 14(1)(b) is a bar. In my opinion, Mr. Chatterjee is correct in his submission. The question of fact cannot be raised in the proceeding under Order 14, Rule 2 of the Code. Mr. Chatterjee further contended that the suit as framed is maintainable. The bar of Section 14 of the Act can only be applied when the jurisdictional fact is decided by the Courts below. In my opinion, assuming all the statements made in plaint as correct (which however is not admitted by the defendant) the Court may see whether the bar of section 14(1)(b) or (c) apply in the facts of this case.
In my opinion, assuming all the statements made in plaint as correct (which however is not admitted by the defendant) the Court may see whether the bar of section 14(1)(b) or (c) apply in the facts of this case. The case of the plaintiff as pleaded is that there is an assurance given by the company that the terms and conditions of the service of the employee will not be changed at all and the Company is under a statutory obligation under section 9A of the Industrial Disputes Act not to change the conditions of service and that the defendants are trying to commit, a breach of the obligation existing in favour of the employee of the defendant company. On the face of it, it appears that the plaintiff in this suit is trying to enforce a contract of service on the basis of the subsisting agreement between the company and its workmen and/or statutory obligation. Therefore, on the plaint as framed, I have no doubt that the plaintiff is trying to enforce the terms and conditions of the service between the employee and the employer. It is argued by Mr. Chatterjee, assuming section 14(1)(b) is bar, still the case is covered under section 42 of the Specific Relief Act. Section 42 of the Specific Relief Act runs as follows : "Section 42. Injunction to perform negative agreement. Notwithstanding anything contained in clause (e) of section 41, where a contract comprises an affirmative agreement to do a certain act, coupled with a negative agreement, express or implied, not to do a certain act, the circumstance that the court is unable to compel specific performance of the affirmative agreement shall not preclude it from granting an injunction to perform the negative agreement ; Provided that the plaintiff has not failed to perform the contract so far as it is binding on him". From the said section it appears that the affirmative agreements cannot be enforced specifically by Court but negative agreements can be enforced by injunction. In this case, however, on the facts as alleged in the plaint, it can not be said that there are two parts of the agreement and so the question of granting a perpetual injunction for the negative part does not at all arise.
In this case, however, on the facts as alleged in the plaint, it can not be said that there are two parts of the agreement and so the question of granting a perpetual injunction for the negative part does not at all arise. On the other hand if this relief as claimed is allowed the Court will be enforcing an agreement which in my opinion, is specifically barred under section 14 (1)(b) and/or 14(1)(c) of the Specific Relief Act. A relief which cannot be granted directly cannot be allowed indirectly. 9. Mr. Chatterjee relied upon the case reported in 14 Mad, 18 (Madras Railway Company v. Thomas Rust) in support of his contention. In the said case the defendant signed an agreement in England with the Madras Railway Company whereby he contracted to serve the company exclusively for 4 years in India under a penalty of £ 100. The defendant came to India at the expense of the company and served the company for 2 years and left the service for that of another employer. The Court held that the defendant had no right to rescind the agreement and an interlocutory injunction was granted to the plaintiff restraining the defendant from serving others. The interim order was in respect of a negative agreement. The affirmative agreement could not be enforced according to the said judgment. In my opinion the said case does not lay down the contention which has been put forward by Mr. Chatterjee. 10. Mr. Chatterjee further relied upon the case reported in ILR 1936 Cal. 354 (Burn and Co. Ltd. v. Macdonald). It is also a case of an injunction in respect of a negative agreement. The agreement was made in England where the defendant was engaged by B. & Co. for a period of 5 years. During the terms of the agreement the defendant left the employment of the firm of the plaintiff and entered another firm. The suit having been brought the plaintiff was granted an injunction restraining the defendant from serving the other firm. In the facts of that case this Court held that though there was no negative condition in the terms of the agreement, a negative covenent could be implied and therefore the interim order was granted. On the face of the plaint, in my opinion, it is clear that there was no such agreement.
In the facts of that case this Court held that though there was no negative condition in the terms of the agreement, a negative covenent could be implied and therefore the interim order was granted. On the face of the plaint, in my opinion, it is clear that there was no such agreement. In my opinion, the case has no application. In the present case as I have held that the plaintiffs have no right to claim a specific performance regarding the minute details of a contract of service and/or contract of service which is determinable, they cannot have the same relief by way of injunction under section 42 of the Specific Relief Act. 11. Mr. Mukherji relied upon the case reported in 1974 (2) LLJ, 106 (Calcutta Electric Supply Corporation v. Ramratan Mahato) in support of his contention. In the said case, the Division Bench held that only in exceptional cases of wrongful dismissal, a declaration that the order is a nullity and reinstating the dismissed employee in service may be made. The said exceptions are (1) where a public servant is dismissed from service in contravention of Article 311, (2) reinstatement of a dismissed worker under the Industrial Law by a Labour or Industrial Tribunal and (3) where a statutory body has acted in breach of a statutory obligation. The Division Bench held that if an employee is retrenched or dismissed inviolation of the Standing Orders, a suit is not maintainable. The Division Bench held that "in the present case, no statutory status was conferred on the respondent. The effect of the Standing Order is only to incorporate certain provisions in the contract of service between the appellant and the respondent. The contract still remained a contract of service. The nonobservance of the provisions of the standing order does not make the order of dismissal a nullity although it may be wrongful or illegal". Mr. Chatterjee sought to distinguish the decision on the ground that the case pending before the court below is not one of wrongful dismissal but is based on contract which is protected under section 9A of the Industrial Disputes Act or in other words the right of the plaintiffs is based on a statutory status of the employees.
Mr. Chatterjee sought to distinguish the decision on the ground that the case pending before the court below is not one of wrongful dismissal but is based on contract which is protected under section 9A of the Industrial Disputes Act or in other words the right of the plaintiffs is based on a statutory status of the employees. In my opinion, section 9A of the Act provides for change in conditions of service and requires that it must be done in a particular manner but that does not mean that the, employee by the process has a statutory status as pointed out in the case reported in 1973(2) L.L.J. 226. The fact remains that even under section 9A of the Act it is clear that the said section speaks of change in the conditions of service which in view of section 14 of the Specific Relief Act cannot be agitated in a Civil Court for the purpose of obtaining specific performance. Whether that can be agitated under the Industrial Disputes Act is a different matter. 12. In my opinion, therefore, the suit as framed is not maintainable. I, therefore, set aside the order passed by the learned Judge, City Civil Court and hold that the suit is not maintainable being barred under section 14 of the Specific Relief Act and that the suit is liable to be dismissed. The Rule is made absolute without any order as to costs.