Yograi Beliramji Sachdeva v. National Textile Corporation Ltd.
1982-04-20
H.G.MISHRA
body1982
DigiLaw.ai
ORDER H.G. Mishra, J. This is a petition under Article 226 of the Constitution of India for issuance of a writ of Certiorari and or any other suitable writ, order or Direction for quashing the order of termination of Services of the petitioner (Vide No. 2576/80/88, dated 6th,/7th June 1980-Annex. M). Briefly stated the case of the petitioner as emerging from the petition and his rejoinder is as under : That the petitioner was appointed as spinning Master in the Kalyanmal Mills Ltd. Indore, on 25-9-1971 (Vide Annex. A). This appointment was confirmed on 21-10-1972 (vide Annx. B) by the Technical Director of the said Mills. Thereafter under the Sick Textile Undertaking (Nationalisation) Ordinance 1972 was promulgated which was eventually replaced by the Sick Textile Undertaking (Taking over of Management) Act, 1972 according to which the management of the Kalyanmal Mills Ltd. vested in the Central Government. A Custodian of the Kalyanmal Mills Ltd. who was appointed under the said ordinance and continued as such under the aforesaid Act designated the petitioner as a spinning Superintendent in the aforesaid Mills vide No. 1252/73 dated 19-4-1972 (Annex. C) and the question of giving him grade shall be considered when the M. P. State Textile Coporation Ltd., Bhopal decides the strength and grades for the various officers in the Mills. Thereafter the Sick Undertakings (Nationalisation) Act, 1974 (Act No. 57 of 1974) was brought into force w. e. f. 21-12-1974. As a consequence as envisaged by section 3(1) of the said Act the sick undertakings mentioned in its Schedule vested with retrospective effect from 1-4-74 in the Central Government. By virtue of Sec. 32 of the said Act, the National Textile Corporation Ltd., New Delhi has been given power to transfer the sick undertakings so vested in it to a subsidiary Company. Accordingly, on 23-11-1974 the sick undertaking in which the petitioner was employed was transferred by the National Textile Coporation Ltd. to the National Textile (M. P.) Ltd. Bhopal and on such transfer the said sick undertaking vested and continued to be so vested in the National Textile Corporation Ltd. (M. P.) w.e.f. 1st April 1974. Thereafter the petitioner was transferred as production Manager to New Bhopal Textiles Ltd., Bhopal vide No. 11-1(9)/74-8466, dated 31-7-74 (Annex.
Thereafter the petitioner was transferred as production Manager to New Bhopal Textiles Ltd., Bhopal vide No. 11-1(9)/74-8466, dated 31-7-74 (Annex. D) by the Personnel Manager of the Madhya Pradesh State Textile Corporation Ltd., Bhopal (A subsidiary Company of the National Textile Corporation Ltd., New Delhi an undertaking of the Central Government). Then on 27-2-75 the petitioner was granted an ad hoc increment of Rs. 100/- by the Manager of the National Textile Corporation (M. P.) Ltd., Bhopal vide No. II/NBT/ (3)/75/2680, dated 17/18-2-1975 (Annex. F). Thereafter on 14-5-1977 the petitioner was transferred on promotion to the Hira Mills, Ujjain and worked as General Manager in temporary capacity in the aforesaid Mills until further orders vide No. II/NBT/75/6281 dated 13th/14th May 1975 (Annex. G) by the Managing Director of the National Textile Corporation (M. P.) Ltd., Bhopal. From 1-4-1976 the National Textile Corporation (M. P.) Ltd., Bhopal brought into force the 'National Textile Corporation (Madhya Pradesh) Limited Employees, Conduct, Discipline and Appeal Rules 1976' (Annex. H). Thereafter the petitioner continued as General Manager of the Hira Mills Ltd. upto 11-4-1978 when he was confirmed on that post vide order No. 2708/Estt./78 dated 6th/11th April 1978 (Annex.J) issued by the Personnel Manager of the National Textile Corporation (M. P.) Ltd., Iadore. However, this appointment was for a period of five years terminable by a three months' notice on either side. The petitioner objected to this condition vide his letter dated 22-4-78 (Annex. J-2). On 17-10-1979 the petitioner was transferred as General Manager to Swadeshi Cotton & Flour Mills, Indore in the same capacity and on the existing emoluments vide order No. 6728/Estt./79 dated 17th October 1979 (Annex. L). However the service conditions of the petitioner's appointment remained unchanged. Thereafter the petitioner received a letter dated 15-11-1979 issued by the General Manager (Annex. L-l) along with which a proforma of option was sent indicating the petitioner that he should exercise option within a period of one week from the date of the receipt of the covering letter. In the said letter it was also stated that in case the option was not received within the prescribed period the petitioner shall be deemed to have elected to be governed by the revised scales of pay on and from 1-10-1979. In para. 4 of the said letter (Annex.
In the said letter it was also stated that in case the option was not received within the prescribed period the petitioner shall be deemed to have elected to be governed by the revised scales of pay on and from 1-10-1979. In para. 4 of the said letter (Annex. L-l) it is stated that - After fixation of your pay in the revised scale w. e. f. 1-10-1979 you will be governed by the rules, ragulations and other service conditions prescribed and presently applicable to the employees of this corporation and as amended/altered/revised from time to time any further agreement settlement of award in respect of pay scales. Other benefits for the employees of the N. T. C. (M. P.) Ltd. will not be applicable to you. In reply to the said letter the petitioner sent the proforma of option duly tilled in vide Annex. L-2 dated 3-12-1919. In para 3 thereof it has been stated : - I agree that after electing the N. T. C Scales I will be governed by the Rules, Regulations and other service conditions of the Corporation and will not be entitled to the benefits of any existing or future agreement settlement of award relating to pay scales and other benefits applicable to the employees of Textile Mills of N. T. C. (M. P.) Ltd. By order dated 6th/7th June 1980 (Annexure M) the petitioner was inter alia informed that his services are no longer required w. e. f 7th June 1980 AN and a crossed cheque of three months' pay in lieu of 3 months' notice as envisaged in his initial appointment letter No, 2708/Estt /78/ 8041-43 dated 6/11-4-1978 (Annex. J) is being given to him separately. Now the petitioner contends that this order of termination of his services (Annex. M) is illegal, void and inoperative inter alia on the ground (i) that the introduction of condition in Annex. J to the effect that his appointment is for a period of 5 years terminable by three months" notice on either side is illegal; (if) that after calling upon the petitioner to exercise his option vide letter Annex. L-l dated 15-11-1979 and after exercising of option by the petitioner vide Annex.
J to the effect that his appointment is for a period of 5 years terminable by three months" notice on either side is illegal; (if) that after calling upon the petitioner to exercise his option vide letter Annex. L-l dated 15-11-1979 and after exercising of option by the petitioner vide Annex. L-3 dated 3-12-1979 the services of the petitioner ceased to be contractual in character and began to be regulated by Rules/regulations and other service conditions prescribed and applicable to the employees of the Corporation, (iii) that the impugned order of termination of his services could not be based on the condition of three months' notice as contained in Annex. I more so because the age of superannuation had already been fixed at 58 years as is clear from Regulation: 4(a) of the Revised Gratuity Scheme circulated vide letter No. 2412/Estt./ 78/28783 86 dated 3-2-1979 issued by the Personnel Manager of N.T.C. (M. P.), Indore and also from Circular No Estt/79/3640 dated 23-5-1979 and (iv) that the impugned order in reality being an order of dismissal from service is vitiated by mala fides. The petition is resisted by the respondent No. I inter alia on the grounds set out in the Return and the reply to the rejoinder (i) that N. T. C. (M. P.) being a Company incorporated under the Companies Act is a private body against whom a writ under Art. 226 of the Constitution does not issue. Moreover the services of the petitioner being contractual in character and not statutory his remedy can be by way of a suit for damages or for any other relief but a petition under Art 226 of the Constitution is not maintainable; (ii) that the imposition of the condition regarding duration of appointment of the petitioner being for five years terminable by three-months' notice on either side vide Annex. J is proper and continues to be effective, (iii) that even after sending of letter (Annex.
J is proper and continues to be effective, (iii) that even after sending of letter (Annex. L-l) along with a proforma of option the services of the petitioner did not cease to be contractual in character, (iv) that there is no Rule enabling the employees like the petitioner to continue as of right upto the age of superannuation, (v) that the impugned order of termination of services of the petitioner has not been passed by way of punishment and does not amount to an order of dismissal and (vi) that the impugned order is merely an order of termination of the services of the petitioner. During the course of arguments vide order dated 25-2-82 of this Court one of the points which cropped up for consideration was as to whether there was any 'age of superannuation' for the employees and whether the N. T. C. (M. P.) Ltd. "has been acting upon that age. Since it appeared necessary to this Court to direct the parties to submit affidavit of some competent person to depose on the point an order to that effect was made, In pursuance of this order Shri L. J. Kale, personnel Manager of the N. T. C. (M. P.) Ltd., Indore submitted his affidavit on 11-3-1982 and the petitioner submitted his own affidavit on 15-3-1982. In this case the controversy between the parties has boiled down into a narrow compass. On the one hand the petitioner claims that condition No. 2 in Annex. J regarding the duration of his appointment being for five years terminable by 3 months' notice on either side had ceased to be operative after the exercise of option vide Annex. L-2 dated 3-12-1979 in pursuance of Annex. L-l sent by the N. T. C. (M. P.) and his service condition stood altered and instead of being contractual in character began to be regulated by rules and regulations governing the service conditions applicable to employees of the N. T. C (M. P.) Ltd. Accordingly the order of termination of his services being solely based on the aforesaid Condition No. 2 is wholly ineffective and inoperative. The petitioner also claims that the age of superannuation of the employees other than workmen having been fixed at 58 years the service condition got altered within the contemplation of section 16 read with section 14(2) of the Act No. 57 of 1974.
The petitioner also claims that the age of superannuation of the employees other than workmen having been fixed at 58 years the service condition got altered within the contemplation of section 16 read with section 14(2) of the Act No. 57 of 1974. For this reason also the impugned order is illegal and ineffective. On the other hand the respondents contend that the services of the petitioner remain contractual in character in spite of the exercise of his option by the petitioner vide Annex. L-2 and in spite of fixation of age of superannuation in absence of a rule entitling the employees like the petitioner to continue upto the age of superannuation. Now Section 16 of the Act No. 57 of 1974 provides as under: - "16. Transfer of employees to a Subsidiary Textile Corporation.- Where any sick textile undertaking or any part thereof is transferred under this Act to a Subsidiary Textile Corporation every person referred to in sub-section (1) and sub-section (2) of section 14 shall on and from the date of such transfer become an employee of the subsidiary Textile Corporation and the provisions of Sections 14 and 15 shall apply to such employees as they apply to an employee of the National Textile Corporation as if reference in the said sections to the National Textile Corporation were reference to the subsidiary Textile Corporation." (Emphasis supplied) Section 14 of the above Act which is relevant for the present purposes reads as under :- Employment of certain employees to continue. (1)........................
(1)........................ (2) Every person who is not a workman within the meaning of the Industrial Disputes Act, 1947 and who has been immediately before the appointed day employed in a sick textile undertaking shall in so far as such person is employed in connection with the sick textile undertaking which has vested in the National Textile Corporation become as from the appointed day an employee of the National Textile Corporation and shall hold his office or service therein by the same tenure at the same remuneration and upon the same terms and conditions and with the same rights and privileges as to pension and gratuity and other matters as he would have held the same under the sick textile undertaking if it had not vested in the National Textile Corporation and shall continue to do so unless and until his employment in the National Textile Corporation is duly terminated or until his remuneration, terms and conditions of employment are duly altered by the National Textile Corporation: Provided that in respect of any sick textile undertaking the management of which could not be taken over by the Central Government under the Sick Textile Undertakings (Taking Over of Management) Act, 1972 by reason of any decree order or injunction of any court any agent, director (including a managing or whole time director by whatever name called) or manager shall not become an employee of the National Textile Corporation." (Emphasis supplied) Undisputedly the petitioner is a person falling within sub-section (2) of Section 14 read with section 16 of the Act he being a person who is not a workman within the meaning of the Industrial Disputes Act, 1947. Now as the N. T. C. (M. P.) asked the petitioner to exercise option by their letter Annex. L-l and further asked him to exercise his option in accordance, with the proforma appended thereto and when the petitioner exercised his option in matter vide Annex. L-2 it will be regarded that the terms and conditions of employment as contained in Annex. J stood duly altered and replaced by the Rules and Regulations applicable to the employees of the N. T. C. (M. P.) Ltd. as envisaged in para 4 of the option letter Annex. L-l reproduced above. The contention put forth on behalf of the respondents that nothing contained in the option letter Annex. L-l and the options AN.
J stood duly altered and replaced by the Rules and Regulations applicable to the employees of the N. T. C. (M. P.) Ltd. as envisaged in para 4 of the option letter Annex. L-l reproduced above. The contention put forth on behalf of the respondents that nothing contained in the option letter Annex. L-l and the options AN. L-2 constitutes a change in the service conditions appears to overlook the contents of para 4 of the option letter and those of para 3 of the option Annex. L-2. That apart in view of the Circular letter No. Estt/79/3640 dated 23-5-1979 (quoted in the affidavit of the petitioner dated 15-3-1982) and in view of the admission made in the affidavit of Shri L. J. Kale, Personnel Manager of the N. T. C. (M. P.) Ltd., Indore it is clear that the age of superannuation for employees like the petitioner laid down and acted upon is 58 years'. It is no doubt true that a rule fixing the age of superannuation does not confer upon any employee an indefeasible right to retire only on the attainment of that age. It is also true that the employer can compulsorily retire an employee for good reasons before attainment of the age of superannuation or may continue him thereafter in the public interest and in view of his efficiency beyond that age. However, in this case the order of termination of the services of the petitioner is solely based on the condition of three months' notice term incorporated in Annex. J. The impugned order of retirement is thus attributable to the condition mentioned in Annex. J only and cannot be regarded to have been passed on considerations of desirability of retiring the petitioner before the attainment of age of superannuation. It is the law well settled that public orders publicly made in exercise of statutory authority have to be construed objectively with reference to the language used in the order itself. In this view of the matter the impugned order of termination of the services of the petitioner is based on the condition contained in Annex. J which stood superseded with the exercise of the option Annex. L-2 by the petitioner in pursuance of letter of option Annex. ;L-1 and also with the fixation of age of superannuation.
In this view of the matter the impugned order of termination of the services of the petitioner is based on the condition contained in Annex. J which stood superseded with the exercise of the option Annex. L-2 by the petitioner in pursuance of letter of option Annex. ;L-1 and also with the fixation of age of superannuation. As such the impugned order has no legs to stand on and being not authorised by law as envisaged by section 16 read with section 14(2) of Act No. 57 of 1974 is wholly illegal and ineffective'. Before parting with this order it has to be stated that although in the Return the respondent has set out a plea that the petitioner's petition cannot be entertained under Article 226 of the Constitution of India yet in view of the ratio of Sukhdev Singh v. Bhagatram AIR 1975 SC 1331 , Ramana v. I.A. Authority of India AIR 1979 S C 1628, U.P. Warehousing Corpo. v. Vijay Narayan AIR 1980 SC 840 , Som Prakash v. Union of India AIR 1981 SC 212 and Ajay Hasia v. Khalid Mujib AIR 1981 SC 487 . Mr. Chafekar learned counsel for the respondent stated not to press the plea on the point. In the light of the discussion aforesaid the petition succeeds and is hereby allowed. The impugned order No. 2576/80/88/ dated 6th/7th June 1980 (Annex. M) is hereby quashed. No order as to costs. The amount of security if any shall be refunded to the petitioner. Petition allowed