Judgment.-The defendant in O.S. No. 214 of 1971 in the Court of the Subordinate Judge of Coimbatore, is the appellant. The plaintiff one Veerappan was appointed as Manager of the defendant-company on 15th December, 1958 as per Exhibit A-1 on a monthly salary of Rs. 850 with the usual benefits including conveyance allowance. He was drawing a salary of Rs. 1,150 per month since 1965. In that year, he was sent abroad for training under auspices of the National Productivity Council. There was an agreement entered into between the plaintiff and the defendant on 23rd March, 1964 which has been marked as Exhibit A-2. Under Exhibit A-2 he was entitled to his usual salary and allowances, and he was further to serve the defendant for not less than three years in the Manager’s grade after his return from the training, failing which he would be required to compensate the Mills in accordance with clause 4 of the agreement. He underwent training ‘for six months in U.S.A. and returned to India and joined duty on 15th July, 1965. He was under an obligation to serve upto 15th July, 1968. However, the defendant-Mills was closed on 23rd April, 1968. On the date of closure, the plaintiff’s salary for the month of March, 1968 and upto the date of closure together with other allowances and bonus were due. The plaintiff alleged that his services had not been terminated in spite of the closure. On 27th July, 1968, he wrote to the defendant, asking whether he still continued in service, and in the reply dated 12th August, 1968, he was informed that he was at liberty to seek some other employment. He thereafter, obtained an employment from 21st August, 1968. He claimed in the suit, which has led to the present appeal, the salary and other emoluments upto 20th August, 1968 and also interest on the arrears at the rate of 12 per cent. Per annum from 20th August, 1968 on the basis that he continued in service upto that date. The amount claimed in the suit was Rs. 12,064. 2. The defendant in its written statement contended inter alia that the notice of closure was a public notice issued to all the employees stating that their services had been terminated and that the management gave notice of resumption of works about which the plaintiff was also informed. But he did not return. 12,064. 2. The defendant in its written statement contended inter alia that the notice of closure was a public notice issued to all the employees stating that their services had been terminated and that the management gave notice of resumption of works about which the plaintiff was also informed. But he did not return. It is stated that the plaintiff himself had considered that he was no longer in the service of the Mills. His securing an appointment even on 20th August, 1968 was referred to in this context. The defendant admitted the liability only to the extent of Rs. 2,338.32 which according to the defendant, had been offered to the plaintiff on 24th December, 1969 and which was declined by the plaintiff. 3. The learned trial Judge held that the plaintiff was given a notice regarding the closure of the Mills, that the plaintiff would be entitled to a decree for Rs. 8,180 and that he would also be entitled to interest at the rate of 9 per cent. Per annum from 20th August, 1968 till date of suit and at 6 per cent. Per annum thereafter. In effect, the suit was decreed almost on the terms as prayed for by the plaintiff. The defendant has filed this appeal challenging the decree so passed by the Court below. 4. The learned counsel for the appellant submitted that under Exhibit A-1the contract of employment was terminable by one month’s notice and that Exhibit A-2 only provided for continuation of the employment of the plaintiff for a period of three years subsequent to his return from the training. The contention, therefore, was that the plaintiff would be entitled only to one month’s salary and allowances, and that the Court below ought not to have granted any salary and allowance upto 20th August, 1968. For the respondent the submission was that Exhibit A-2 should be read independently of Exhibit A-1, that Exhibit A-2 incorporated all the terms of the contract between the parties and that in the absence of any period of notice, the plaintiff would be entitled to salary for the unexpired period of three years, and for the period he continued in service thereafter. It was also submitted that the Court below was wrong in proceeding as if he had notice of the termination of the services and that the correspondence with the company, would show that he did not have any notice of the termination of his employment. According to him, there was no termination till he took up an alternative employment. 5. Two questions arise for consideration in the context of the above facts. The first is whether there was termination of the service of the plaintiff at any time before 20th August, 1968 and the second is whether the plaintiff is entitled to salary and allowances for the period upto 20th August, 1968 after which he took an alternative employment. 6. With reference to the first point it is necessary to refer to Exhibit B-8, which was a public notice issued by the defendant-Mills on 23rd March, 1968. It is stated therein that the cotton industry had been passing through a crisis for three years and that particularly the running of this Mills had been affected by it. The notice refers to the continuing losses that would result if the Mill was run thereafter, and to the decision of the Management, with regret that the Mill would be closed with effect from the expiry of 30 days from that date. It is stated that during the period of closure there would be no salary or wages or compensation either to the workmen, clerks or officers. The Court below has referred to the fact that the plaintiff himself has indicated its receipt in Exhibit B-2 dated 15th April, 1968, which was sent even before the actual closure of the Mills by the National Textile Workers Union to the defendant referring to the public notice on 23rd March, 1968 of the closure of the Mills with effect from 30 days thereafter. The trial Court has, therefore, considered that the plaintiff was and would have been aware of the notice of the closure issued on 23rd March, 1968. Further, his own letter dated 27th July, 1968 shows that he was aware of the terminations . Having regard to the above, it is difficult to accept the plea that he was not aware of the notice regarding closure of the Mills issued on 23rd March, 1968. I, therefore, confirm the finding of the Court below that the plaintiff was aware of the closure. Having regard to the above, it is difficult to accept the plea that he was not aware of the notice regarding closure of the Mills issued on 23rd March, 1968. I, therefore, confirm the finding of the Court below that the plaintiff was aware of the closure. The notice issued under Exhibit B-8 was a notice issued to all the employees including the plaintiff. It does not purport to be issued to any particular class of employees so that the others would stand out of it. 7. The learned counsel for the appellant contended that the closure of a Mill involves an automatic termination of the employment of even’ one working therein and for this purpose drew my attention to a decision of the Supreme Court in The Workers of the Pudukottah Textile Mills v. The Management of the Pudukottah Textile Mills1. The judgment of the Supreme Court is dated 3rd April, 1964. In that case, a fire broke out in the godowns of the mills on 25th May, 1960 which resulted in the destruction of a very large part of the cotton stored in the mills and the value of the loss suffered in the fire was estimated at over rupees five lakhs. The mill itself was under considerable financial strain and the huge loss on fire added to its difficulties. Consequently, the management gave notice stating that the work in the mills would be suspended until further notice. A few days thereafter the management gave notice that the Directors had decided to close down the mills with effect from 8th June, 1960 and all the workmen would be discharged from that day and would be paid compensation as provided under the Industrial Disputes Act of 1947. On 11th August, 1960, the Directors decided to reopen the mills in view of the representations received from the workmen who had been thrown out of employment and in view of the Labour Union assuring its cooperation in working the mills properly. At the time of the reopening 169 of the old workers were not re-employed. The others were taken back in service. There was industrial dispute consequent on the failure in the mills to take in 169 of the old employees. At the time of the reopening 169 of the old workers were not re-employed. The others were taken back in service. There was industrial dispute consequent on the failure in the mills to take in 169 of the old employees. The dispute was referred to the Industrial Tribunal, which came to the conclusion that the closure was not bona fide and that the services of the 169 workmen could not be deemed to have been terminated. The matter was thereafter taken to the Supreme Court in C.A. No. 589 of 1961. There was a remand and subsequently after the Industrial Tribunal considered the matter afresh and passed its award, there was a further appeal to the Supreme Court. It was in the further appeal the Supreme Court pronounced that the closure on 8th June, 1960 was genuine and bona fide. 8. The aspect with which I am now concerned viz., whether the closure would involve the termination of the services of the employees, was not specifically discussed. But the basis of the decision of the Supreme Court is that the employment of the 320 employees who had previously been engaged in the mills had been terminated, that all of them need not be taken in the mill when it re-opened and that the management could take only such of those as it could find necessary for its employment. It is implicit in this decision that closure involves termination of employment. Section 25-FFF of the Industrial Disputes Act is based on this principle. 9. My attention was also drawn to another decision of the Supreme Court in Anakapalle Co-operative Agricultural and Industrial Society v. Its Workmen and others1. In that case, a company engaged in the business of manufacturing sugar incurred losses. A co-operative society purchased the business of the company. The company paid its employees retrenchment compensation. Some of the workmen were not given re-employment by the purchaser society. As a result of this, an industrial dispute arose and the matter was referred to the Industrial Tribunal. It is unnecessary to set out any further facts or the course of the proceedings that took place. It is enough to mention that in the context of the above facts on the course of the proceedings the Supreme Court considered the applicability of section 25-FF of the Industrial Disputes Act. It is unnecessary to set out any further facts or the course of the proceedings that took place. It is enough to mention that in the context of the above facts on the course of the proceedings the Supreme Court considered the applicability of section 25-FF of the Industrial Disputes Act. That section provided that where the ownership or management of the undertaking was transferred either by operation of law or by agreement between the parties, every workman who had been in continuous service for not less than one year in that undertaking, immediately before such transfer should be entitled to notice and compensation in accordance with the provisions of section 25-F as if the workmen had been retrenched. In construing this provision, the Supreme Court pointed out: "He (Solicitor-General) argues, and we think rightly, that the first part of the section postulates that on a transfer of the ownership or management of an undertaking, the employment of workmen engaged by the said undertaking comes to an end……" 10. In other words, the principle behind the decision of the Supreme Court is that on a transfer of the ownership or management of an undertaking, the relationship of master and servant with the transferor comes to an end. 11. In Nokes v. Doncaster etc., Collieries Ltd.2, it was held that an amalgamation of two companies by order of the Court under section 154 of the Companies Act, 1929 of the U.K. did not operate as a contract of service between the workman and the transferee company" and that the workman was not bound by the transfer. Thus, it is clear that as a result of a transfer of an undertaking, there is snapping of ties between master and servant. . Similarly it has been held that where a dissolution of partnership occurs due to the death of one of the partners, a contract of service with the firm is thereby terminated. A resolution to wind up a company voluntarily also operates as a notice of dismissal if it involves a termination of the servant’s employment by the company . See Halsbury’s Laws of England, Third Edition, Volume 25, ‘paragraphs 929 and 930. In principle, there can be no distinction between a case of closure and the other cases envisaged above. A resolution to wind up a company voluntarily also operates as a notice of dismissal if it involves a termination of the servant’s employment by the company . See Halsbury’s Laws of England, Third Edition, Volume 25, ‘paragraphs 929 and 930. In principle, there can be no distinction between a case of closure and the other cases envisaged above. The principle that the closure of a business results in the snapping of ties between master and servant, would have to follow logically. Otherwise, the closure would absolutely have no meaning. The closure is contemplated only for the purpose of putting an end to the continuing losses and if the relationship of master and servant is to continue even after the closure, it would not achieve the purpose for which the closure is contemplated. Thus, when once the establishment decides on closure, the result would be termination of the employment of the servants. Thus, either on the basis that the plaintiff had notice of the termination as a result of Exhibit B-8 or the plaintiff’s contract of employment got terminated consequent upon the closure, in either event, there has been snapping of the ties of the relationship of master and servant between the plaintiff and the defendant on 23rd March, 1968. 12. This leads to the consideration of the question as to what will be the compensation that will be due to the plaintiff. I have already referred to the contention of the learned counsel for the appellant that the period of one month’s notice as set out in Exhibit A-1 has to be read into Exhibit A-2, while the contrary was argued by the learned counsel for the respondent. Taking the language of Exhibit A-2, I consider that it only continues the employment of the plaintiff on the same terms and conditions as obtained prior thereto. The company did not terminate his services at the time when he went abroad. In fact, during his training period, the plaintiff was allowed to draw his salary and allowances as usual as provided by clause 5 of Exhibit A-2. If the contract continued during the period of the plaintiff’s training, subsequently after he rejoined there was no termination of the contract until closure. Exhibit A-2 was entered into for the limited purpose of seeing that the plaintiff’s services were available after he returned from his training. If the contract continued during the period of the plaintiff’s training, subsequently after he rejoined there was no termination of the contract until closure. Exhibit A-2 was entered into for the limited purpose of seeing that the plaintiff’s services were available after he returned from his training. The earlier contract was not given the go-by or was otherwise altered. 13. In Percy Edward Warne v. The Ouchterlony Valley Estate (1938) Ltd.1, a Bench of this Court went into the question of a contract of service for a fixed period. In the contract, there was a provision for determination of the service. In that particular case, the contract period was four years and the notice period was three months. The contract was terminated and it was held by this Court that the measure of damages in such cases of wrongful dismissal would only be the amount of wages for the period of notice, which might be regarded as liquidated damages fixed by the parties, and the damages could not be awarded on the basis of the salary for the entire unexpired period under the service contract. 14. There is an earlier decision of this Court in Muna Sona Sundaram Chettiar v. Sona Theeanna Chockalingam Chettiar alias Nagappa Chettiar2. In that case, a person was appointed as an agent for a period of three years. The employer finding that his business was not proving profitable, terminated the agent’s employment before the expiry of his period. The agent sued for the salary for the unexpired period of his service contract. At page 859 it was observed as follows: “If the contract provides for termination of employment by notice, the employer can lawfully terminate the employment on giving the required notice.” 15. But in that particular case, as there was no period of notice contemplated between the parties, the salary for the unexpired period of service was decreed.. It is. Unnecessary to refer to the other decisions that were cited. They do not take a different view. The principle is clear. In the case of a contract for a fixed period, in the absence of a provision in the notice, the employee is entitled to damages on the same salary and allowances for the unexpired period of contract, if the contract was terminated during its currency. They do not take a different view. The principle is clear. In the case of a contract for a fixed period, in the absence of a provision in the notice, the employee is entitled to damages on the same salary and allowances for the unexpired period of contract, if the contract was terminated during its currency. But, where there is provision for a period of notice, then the damages will be awardable only to the extent of salary and allowances for the notice period. There is no decision which takes a contrary view. Therefore, the plaintiff in the present case will be entitled to only one month’s salary and other allowances apart from bonus etc., that he may be entitled to. The defendant himself has admitted liability on the above basis to a sum of Rs. 2,338.32 and this amount will be substituted in the place of the amount for which the decree-has been passed. 16. There will be modification of the decree of the Court below accordingly. The appeal is allowed accordingly There will be no order as to costs.