JUDGMENT 1. THE main point for determination in this appeal by the defendant and the cross-objection by the plaintiff-respondent is whether an order for transfer of an officer in the employment of a government company to its subsidiary company can be declared by the Civil Court as illegal, viod and inoperative, without granting any further relief to the plaintiff-respondent. 2. THE plaintiff-respondent was appointed to the post of assistant project Officer in the Hindusthan Paper Corporation Limited in a scale of pay of Rs. 1100-50-1250-EB-1400 with an initial pay of Rs. 1200/- per month for a tenure of five years by the secretary -cum executive Officer of the Corporation by a letter of appointment dated 27. 4. 72. It was stated in that letter of appointment, inter alia, that other conditions of service of the respondent would be governed by the relevant rules and orders of the. Corporation in force from time to time and that the appointment carried with it the liability to serve in any part of India. By another office order dated 15. 5. 72, the respondent was intimated that the Chairman- cum- Managing Director of the Corporation had been pleased to appoint him as assistant Project officer with effect from 8. 5. 72, subject to ratification by the Board. In a meeting of the Board of Directors of the Corporation held or, 1. 2. 75, it was decided that the appointment of the respondent would be converted from tenure basis to regular one. This decision of the board of Directors was communicated! to the respondent on 25. 6. 75. The respondent was transferred to Calcutta Office from the New Delhi office of the Corporation on 2. 6. 76. By an office order dated 17. 1. 78, the respondent was transferred by Sri G. D. Sharma, General Manager, (Personnel and Administration) of the Corporation in his existing scale of pay of. Rs. 1300-1700, as Shift -in- Charge (Paper Machine), Nagaland pulp and Paper Company Limited (hereinafter referred to as the 'nagaland company' for the sake of convenience) at Tuli with immediate effect. It was stated in that letter of transfer that the scale of pay of Rs. 1300. /- Rs. 1700/- would remain as personal to the respondent. The respondent submitted a representation dated 27. 1. It was stated in that letter of transfer that the scale of pay of Rs. 1300. /- Rs. 1700/- would remain as personal to the respondent. The respondent submitted a representation dated 27. 1. 78 for postponing his transfer on the ground of illness of his mother and wife and complained in that representation that the transfer would cause his demotion and would block his future promotion. On 1. 0. 2. 78, there was an appeal by the Chairman-cum -Managing Director of the Hindusthan paper Corporation Limited (hereinafter referred to as the 'corporation' for the sake of brevity) in the form of a circular requesting the officers transferred to report to their new place of posting. As nothing was done by the Corporation regarding the respondent's reprsentation dated 27. 1. 78, the respondent sent another representation dated 14. 4. 78 to dr. A. Panda, Director (Technical) of the Corporation. Subsequently, on 8. 5. 78, Sri Panda informed the respondent by a D. O. letter that the respondent's letter dated 14. 4. 78 did not call for any further comments and that 'it was decided that the respondent could better be utilised in a running mill. By that: D. O. letter the respondent was relieved on 8. 5. 78 with a request to hand over the charge of papers to Sri G. P. Garg, Chief Engineer (Feasibility Studies. The respondent preferred an appeal before the Chairman of the Corporation on 19. 5. 78 on the ground that his demotion was illegal and unauthorised. On 31. 5. 78, the respondent received a pay advice whereby" he was allowed to be paid Rs. 216. 75p., being the salary for 8 days for the month of May, 1978. On thinking that his service had been terminated, the respondent moved this Court under article 226 of tire Constitution on 2. 6. 78. A Rule was issued by thus Court and an interim order was passed. The interim order was vacated by this Court as the Corporation submitted that the services of the respondent had not been terminated. The Rule was discharged by this Court on holding, inter, alia, that no writ lay against the Corporation, which was a government company. Subsequently, the respondent filed a title suit in the City Civil Court, calcutta. It is against the judgment and decree passed in that suit that the present appeal and the cross-objections are directed. The Rule was discharged by this Court on holding, inter, alia, that no writ lay against the Corporation, which was a government company. Subsequently, the respondent filed a title suit in the City Civil Court, calcutta. It is against the judgment and decree passed in that suit that the present appeal and the cross-objections are directed. The case of the plaintiff-respondent was that the orders dated 17. 1. 78 and 8. 5. 78 were void, illegal and inoperative and could not be enforced under the terms and conditions of his employment with the Corporation. The respondent prated tor declaration to this effect and for a decree of permanent injunction for restraining the Corporation from giving effect to the order of transfer and the subsequent order dated 8th May, 1978. It was alleged by the respondent that the order of transfer was actually an order for his demotion,. On 21. 2. 80, the respondent prayed for amendment of the plaint by insertion of. paragraphs 10 (a) and 12 (a) in the plaint. The prayer for amendment was allowed. By making this amendment the plaitiff alleged that the Nagaland company was a different and a separate entity and had no connection with the Corporation. It was further alleged that the order of transfer was illegal, mala fide and without jurisdiction as the respondent, not being an employee of. the Nagaland Company, could not be transferred by the Corporation to that Company.- 3. THE defence of the appellant was. that the transfer, being a matter within the exclusive domain of the employer, the City Civil court had no jurisdiction to entertain the suit. It was alleged that the respondent was not transferred to any junior post and that his scale of pay was protected. The alleged demotion of. the respondent, by the order of transfer was denied. An additional written statement was filed by the appellant after insertion of paragraphs 10 (a) and 12 (a)in the plaint. It was stated in the additional written statement that rule 11 of the Service Rules of the Corporation, as approved by the board of Directors of the Corporation in their meeting held on 23. 5. An additional written statement was filed by the appellant after insertion of paragraphs 10 (a) and 12 (a)in the plaint. It was stated in the additional written statement that rule 11 of the Service Rules of the Corporation, as approved by the board of Directors of the Corporation in their meeting held on 23. 5. 75, was to the effect that an employee in the service of the Corporation would be liable to serve in any of its mills or subsidiary companies in any part of the country or abroad, as decided by the order of the chairman or such other subordinate authority to whom power would be delegated. It was further stipulated in that Rule 11 of the Service rules of the Corporation that an employee in the service of the subsidiary company would be liable to serve in the Corporation or any of its subsidiary companies, as decided by the order of the Chairman or such other subordinate authority to whom power would be delegated. It was alleged that on the basis' these service Rules of the Corporation, the transfer of the respondent to Nagaland company was justified and that there was no deration or reduction in rank of the respondent. 4. THE respondent examined himself as P. W. I. Sri Cyen Dutt Sharma, who issued the order for transfer under his signature, was examined as D. w. 1. Considering the evidence of these witnesses and the documentary evidences on record, the learned Judge, 4th Bench, City Civil court, Calcutta, found that the order for transfer of the respondent did not cause any loss of emoluments or any reduction in rank of the respondent and as such, the respondent had no cause of action and the court had no jurisdiction to entertain the suit, there being no dispute of a civil nature within the meaning of section 9 of the code of Civil Procedure. On finding that the plaintiff had nowhere made out a case in the body of the plaint that the order for transfer dated 17. 1. 78 or the subsequent letter dated 8. 5. On finding that the plaintiff had nowhere made out a case in the body of the plaint that the order for transfer dated 17. 1. 78 or the subsequent letter dated 8. 5. 78 was in any way void, illegal, inoperative and un-enforceable under the terms and conditions of service under the Corporation, the learned Judge did not grant any relief by way of declaration to the respondent on the ground that these orders were purported orders for his demotion in the guise of orders for transfer. The learned Judge, however, decreed the suit on declaring that the order for transfer dated 17. 1. 78 was void, illegal and inoperative and could not be enforced under the terms and conditions of the respondent's employment under the appellant on the ground that the order of transfer was passed by the General manager (Personnel and Administration) of the Corporation, though he had no authority to pass such order for transfer. The learned Judge did not pass any decree for permanent injunction or any declaration regarding the D. O. letter dated 8,. 5. 78, as prayed for by the respondent, on the ground that the plaintiff nowhere challenged in the body of the plaint that the order for transfer was void, illegal, inoperative and unenforceable under the terms and conditions of service of the respondent under the Corporation. Mr. Ghosh, the learned Counsel for the appellant, has challenged the decree passed by the learned Judge on the ground that no case was made out by the plaintiff in the plaint or in his evidence that the order of transfer was passed by the General Manager (Personnel and Administration) without any authority. No specific issue was framed in the suit as to whether the order for transfer was passed by the general Manager (Personnel and Administration), having authority to pass the same. As such Mr. Ghosh has contended that the judgment and decree passed by the learned judge should be set aside. 5. MR. Banerjee, learned Advocate for the plaintiff-respondent, has contended that the learned Judge acted rightly in granting the declaration that the order of transfer was illegal, void and inoperative as it was passed by the General Manager (Personnel and Administration)of the Corporation without any authority to pass such order for transfer. Mr. 5. MR. Banerjee, learned Advocate for the plaintiff-respondent, has contended that the learned Judge acted rightly in granting the declaration that the order of transfer was illegal, void and inoperative as it was passed by the General Manager (Personnel and Administration)of the Corporation without any authority to pass such order for transfer. Mr. Banerjee has contended that the learned Judge erred in not granting the other declaration prayed for by the plaintiff regarding the subsequent order dated 8. 5. 78. According to Mr. Banerjee, the learned Judge ought to have come to the conclusion, on the basis of the materials on record, that the order of transfer was actually an order for demotion and reduction in rank of the respondent. Mr. Banerjee has further contended that the order for transfer of the respondent, who was a public servant, in the employment of a Government company, to its subsidiary company was not justified as the subsidiary company was a separate legal entity. Mr. Banerjee relied' strongly on the recent decision of the Supreme court in the case of Central Inland Water Transport Corporation Ltd. V. Brojo Nath (A. I. R. 1986 S. C, 1571) to substantiate his contention that the order for transfer was void, being opposed to public policy under section 23 of the Contract Act, 1872. 6. MR. Ghosh has referred to the. cases reported in A. I. R. 1956 s. C. 231 (J. K. Iron and Steel Company v. The Iron and Steel Mazdoor union, Kanpur), A. I. R. 1970 S. C. 1818 (Ram Prasad v. State of M. P.), a. I. R. 1958 S. C. 255 (Venkataramana Devaru v. State of Mysore), 84 C. W. N. 221 (Vest Bengal Provincial Co-operative Bank Ltd. v. S. N. Ghosh), A. I. R. 1978 S. C. 484 (Ganesh Trading Co. v. Muji Ram), a. I. R. 1968 S. C. 1083 (Om Prabha v. Abnash Chand), and A. I. R. 1953 s,c. 235 (Trojan and Co. v. Nagappa) and has contended that it was not open for the court below to fly, off at a tangent and to reach the conclusion that the order for transfer was issued by the General manager without any authority, on disregarding the pleadings. It is no doubt true that procedural law is intended to facilitate and not to obstruct the course of substantive justice. It is no doubt true that procedural law is intended to facilitate and not to obstruct the course of substantive justice. The provisions relating to pleadings in civil cases are meant to give to each side intimation of the case of the other, so that it may be met to enable the courts to determine what is really at issue between the parties and to prevent deviation from the course which litigation on particular causes of action must take. Order 6 rule 7 of the Code of Civil Procedure contains provision against departure of proof from the pleadings except by way of amendment of pleadings. In the plaint, as originally filed in the court below, there was no case that the order for transfer was issued by the General Manager without any authority. Even in the amended plaint, after insertion of paragraphs 10 (a) and 12 (a) in the plaint, there was no specific averment by the respondent that the general Manager (Personnel and Administration) was not authorised to issue the order for transfer. Even then, the court would be slow to throw out a claim on a mere technicality of pleading when the substance of the thing is there and no prejudice is caused to the other side, however clumsily or inartistically a plaint may be drafted (Kedar lal v. Harilal) A. I. R. 1952 S. C. 47. In the case of Bhim Singh v. Kan singh (A. I. R. 1980 S. C. 727), the Supreme Court distinguished its earlier decision in the case of Trojan and Company v. Nagappa (A. I. R. 1953 s. C. 235. referred to by Mr. Ghosh, and was of the opinion, on following the decision in the case of Bhagwati Prasad v. Chandrammal (1966)2 S. C. R. 286, that the main question was to find out as 'to whether the parties knew that the matter in question was involved in the trial and whether the parties led evidence about it. In the court below, evidence v ere taken during the cross examination of D. w. 1 about the authority of D. W. 1 to issue the order for transfer. In the court below, evidence v ere taken during the cross examination of D. w. 1 about the authority of D. W. 1 to issue the order for transfer. In paragraph 6 of the additional written statement filed for the appellant, it was alleged that the order for transfer was issued to the plaintiff by the general Manager (P and A), who was duly authorised on this behalf, it was for the appellant to prove this part of their case. The three issues framed in the suit were comprehensive, though no specific issue about the authority of the General Manager (P and A) to issue the order for transfer was framed in the case. Mr. Ghosh has contended, on the authority of a decision of the Madras High Court in the case of L. Balamukundas v. K. Kothandapasni (A. I. R. 1971 Madras 422), that the respondent coming to court on a specific case on specific grounds cannot, failing to prove it, try to rely on the facts alleged by the appellant. There can be no dispute about this legal proposition. In fact, this decision of the Madras' High Court is based on a Full bench decision of this Court in the case of Ramdoyal v. Junmonjoy coondoo (1887) I. L. R. 14 Calcutta 791, to the effect that it will certainly be very unusual to permit the plaintiff, who has alleged one set of facts against the defendant, who has denied the case and alleged another set of facts, to turn round and ask to be allowed to carry on the suit and claim relief on the set of facts alleged by the defendant, abandoning his own case (emphasis supplied by us. The respondents has not, however, abandoned his case in the plaint or the amended plaint, by asking the appellant to prove his case in the additional written statement that the General Manager (F and A) was duly authorised to issue the order for transfer. Though no case about the absence of authority of the General Manager (P and A) to issue the order for transfer was made out by the respondent in the plaint and though no specific issue on the score was framed in the suit, D. W. 1 was cross-examined regarding the case in the additional written statement that the General Manager was duly authorised to issue the order of transfer. In these circumstances, the court below was not unjustified in considering the question as to whether the order for transfer was issued by the General Manager (IP and A), on being authorised to issue the same. The Corporation received the certificate of incorporation in 1970-71 from the Assistant Registrar of Companies, Delhi. Ext. A contains the Memorandum and thee Articles of Association of the Corporation. The business of the Corporation is to be managed by the Directors under Article 116 of the Articles of Association. Powers of the directors have been enumerated in Article 117 of the Articles of association. There is no dispute that the Directors had the power to transfer the respondent. The question is whether the General Manager (P and A) had the power to transfer the respondent to a subsidiary company. The evidences of D. W. 1 are that though he issued the office order dated 17. 1. 78, Ext. 2 (b), under his signature, the respondent did not serve under his department and that he had no authority to transfer him. D. W. 1 has justified the order for transfer, Ext. 2 (b), on the ground that it was issued under orders of higher authorities, i. e. Director (Technical) and Chairman -cum -Managing Director. D. W. 1 went on to say that the order for transfer was processed through the general Manager (P and,a) and that the subsequent D. O. letter dated 8. 5. 78, Ext. 6, would show that the respondent was released by the director (Technical) of the Corporation. As regards the documents to show that the order for transfer was issued under orders of the higher authorities, D. W. I stated that those documents were available and could be produced at any time. Relying on these evidences Mr. Ghosh has contended that the learned Court below erred in holding that the General' Manager (P and A) was not authorised to issue the order for transfer though these documents, which were available. were not called for by the respondent from the Corporation. We are unable to accept this contention. It appears that after the examination of D. W. I on 4. 2. 81, a petition was filed for the appellant on 27. 4. 81 in the court below, though the suit was fixed for hearing of arguments, for recording additional evidence. This prayer of the appellant was allowed. On 13. 5. We are unable to accept this contention. It appears that after the examination of D. W. I on 4. 2. 81, a petition was filed for the appellant on 27. 4. 81 in the court below, though the suit was fixed for hearing of arguments, for recording additional evidence. This prayer of the appellant was allowed. On 13. 5. 1981 another petition was filed for the appellant for recalling D. W. I for proving some documents filed by the appellant. This prayer for recalling D. W. I was allowed and D. W. I was further examined and cross-examined on 13. 5. 81. This is thus not a case where the appellant was not given opportunity to file the documents in spite of cross-examination on 24. 2. 81, to support their case that the General manager (P and A) was authorised to issue the order for transfer. The order for transfer was to the effect that the respondent was transferred in his existing scale of pay as Shift -in- Charge of the Nagaland company at Tule with immediate effect. A copy of that office order. Ext. 2 (b), signed by D. W. I, was sent to the Director (Techinical)with the request that the respondent should be released with immediate effect. The subsequent request by the Chairman-cum-Managing Director, in the form of a circular, on 10. 2. 78, was meant also for persons joining the Corporation in 1973. A copy of that circular, Ext. 4, was seat to the respondent. There is nothing in the office order, Ext. 2 (b), to show that the office order was issued on being directed by the board of Directors of the Corporation or the Chairman -cum -Managing directors of the Corporation. If actually that office order was issued under the direction of the Board of Directors or the Chairman-cum-Managing director of the Corporation, there appears to have been no necessity on the part of D. W. I to request the Director (Technical)to release the respondent with immediate effect. It has been contended that even though it was not stated in the office order, Ext. 2 (b), that it was issued under order of the Chariman -cum -Managing Director or the Director (Technical of the Corporation, the D. O. letter dated 8. 5. 78 ratified the order for transfer. It has been contended that even though it was not stated in the office order, Ext. 2 (b), that it was issued under order of the Chariman -cum -Managing Director or the Director (Technical of the Corporation, the D. O. letter dated 8. 5. 78 ratified the order for transfer. This contention cannot be accepted in the absence of any document to show that the Director (Technical) was authorised to transfer an officer of the Corporation with a scale of pay exceeding Rs. 1300/- per month. The service rules of the Corporation, Ext. C, known as HPC Service Rules, 1975, came into effect from 23. 5. 75, on being approved by the Board of Directors of the Corporation in their 23rd Meeting held on' 23. 5. 75. These Service rules contain the provision in Rule 11 about the liability of service recording transfer. Before framing of these service rules, the Board of Directors in their meeting held on 30. 7. 73 had delegated powers to the Chairman -cum –Managing Director and some other officers of the Corporation and had authorised thee Chairman -cum -Managing director to re-work out the schedule of powers to be delegated to Heads of departments and other officers, as was considered appropriate, vide Ext. 11. Accordingly, there was review of delegation of powers by the Chairman-cum -Managing Director and sub-delegations were made to the General Manager (Projects) and other Heads of departments from time to time. This delegation of powers was revised for different departmental heads by a circular on 26. 11. 76, Ext. 11. So far as the cases relating to establishment matters were concerned, it was directed in that circular that these cases should be approved by the authorities to whom powers had been delegated., but processing of such cases should be done through the Personnel Department. It is because of this. circular dated 26. 11. 76 that D. W. 1 stated that the transfer of the respondent was processed through his department. Ext. 11 (b) is the list of powers of the General Manager (P and A) on the basis of this Circular dated 26. 11. 76. No power had been delegated to the general Manager (P and A) to transfer an officer of the Corporation in any scale of pay the maximum of which exceeds Rs. l300/- per month. There was another circular dated 10. 12. 79, Ext. 11. 76. No power had been delegated to the general Manager (P and A) to transfer an officer of the Corporation in any scale of pay the maximum of which exceeds Rs. l300/- per month. There was another circular dated 10. 12. 79, Ext. G, whereby powers were delegated to the General Managers (Projects) by the corporation. Even in this circular, Ext. G, no power has been delegated to the General Manager (Projects) to transfer any officer with a scale of pay, the maximum of which exceesds Rs. 1300/- per month'. It is not disputed that on 17. 1. 78, the respondent was holding the scale of Rs. 1300-1700 and had reached the upper most limit of that scale (vide D. W. I. In the absence of any document or any circular on record to show that the Board of Directors or even the Chairman -cum -Managing director of the Corporation had authorised any General Manager, be he the General Manager (P and A) or General Manager (Technical)or General Manager (Projects), of the Corporation to transfer any officer of the Corporation having a scale of pay exceeding Rs. 1300/-per month, the order of transfer, Ext. . 2 (b), must be deemed to have been issued by the General Manager (P and A) without any authority. If actually the order for transfer was under the direction of the chairman -cum -Managing Director of the Corporation to issue the appeal in the form of the circular, Ext. 4, an 10. 2. 78 and to send copy of the same to the respondent. In short, the appellant has failed to prove his case that the General Manager (P' and A) was fuly authorised to issue the order for transfer on 17. 1. 78. The finding of the court below that the order for transfer was issued by the General Manager (P and A), without any authority to issue the order for transfer, cannot thus be interfered with. 7. THE decision of the Supreme Court in the case of Central Inland water Transport Corporation Ltd. v. Brojo Nath (A. I. R. 1986 S. C. 1571), is a land-mark regarding cases relating to service matters. It was well-established by series of decisions of the Supreme Court that a contract of personal service could not generally be specifically enforced. Three exceptions were laid down viz. It was well-established by series of decisions of the Supreme Court that a contract of personal service could not generally be specifically enforced. Three exceptions were laid down viz. (a) where a public servant was sought to be removed, in contravention of Article 311 of the Constitution or (b) when a worker was sought to be re-instated on being dismissed under the Industrial Law or (c) where a statutory body acted in breach or violation of the mandatory provision of the statute. So far as any company incorporated under the Companies act was concerned, the view of the Supreme Court was that such a company was not created by the Companies Act, but came into existence in accordance with the provisions of that Act. It was not, accordingly, a statutory body because it was not created by the statute. It was a body created in accordance with the provisions of the statute. The difficulty regarding the enforcement of a contract of personal service, arising from the provisions in sections i4 (l) (b) and 14 (1) (d)of the Specific Relief Act, 1963 (corresponding to section 21 of the old Specific Relief Act, 1877) was thus solved by enumerating these exceptions. In the case of Sirsi Municipality v. C. K. F. Tellis ( AIR 1973 SC 855 ), the Supreme Court went a bit further and held that in cases of servants of local authority or statutory bodies, courts have declared in appropriate cases the dismissal as invalid if the dismissal was contrary to the rules of natural justice. Even in the case of Sirsi Municipality (supra), the Supreme Court sounded a warning that apart from the intervention of the statute, there would not be declaration of nullity in the case of termination of dismissal of any servant of the local authorities or statutory bodies. So far as the statutory bodies were created by the statutes. Later on, the meaning of the expresion, "other authorities", appearing in Article 12 of the Constitution, was extended. The Supreme Court was of the view that the expression "other authorities" would include every authority created by statute or functioning under the control of the Government of India. All constitutional or statutory auhtorities on whom powers were conferred by law were held to be the "other authorities" (see sukhadev Singh v. Bhagatram AIR 1975 SC 1331 . The Supreme Court was of the view that the expression "other authorities" would include every authority created by statute or functioning under the control of the Government of India. All constitutional or statutory auhtorities on whom powers were conferred by law were held to be the "other authorities" (see sukhadev Singh v. Bhagatram AIR 1975 SC 1331 . The Supreme Court was of the further view that if it was a case of public sector undertaking, it would be "other authority" within the meaning of that expression in Article 12 of the Constitution (see Workman of Hindusthan steel Ltd. v. Hindusthan Steel Limited AIR 1985 SC 251 . In the case of Central Inland Water Transport Corporation Limited (supra), the supreme Court held that the Central Inland Water Transport Corporation Limited, though a government company under section 617 of the Companies Act, was "the State", within the meaning of Article 12 of the Constitution for the purpose of Parts III and IV of the Constitution. In the present appeal, ill is to be held, on a scrunity of the memorandum and Articles of Association of the Corporation, Exts. A and 7, that the Corporation is "the State" within the meaning of article 12 of the Constitution. The Memorandum and Articles of Association show that the Corporation is in fact owned by the State, in truth controlled by the State and in effect an incarnation of the State, though it is a private company under Article 4 of the Articles of association. A perusal of Articles 43,44, 48,50,51,54,60,65,67,95,96 (a), 144 and 145 of the Articles of Association show the over-all control of the Corporation by the Central Government through the President of India. Be it the increase of capita of the Corporation or issue of new shares or consolidation, division and sub-division of shares, power of borrowing, condition for borrowing, issue of bonus or securities at a discount, premium or otherwise, holding of extraordinary general meeting, the quorum for general meeting, appointment of representative, the number of Directors of the Corporation, appointment of chairman and other Directors of the Corporation or issue of directives, the overall control of the President of India is manifest in the Articles of Association. In these circumstances the Corporation though a private company and registered a government company under section 617 of the Companies Act, 1956, will be "the State" within the meaning of that expression in Article 12 of the Constitution, when it is stated in the personal guide for executives of the Corporation, Ext. 12 (at page 13), that the Corporation, as an agency and instrument of the central Government, has to play an increasingly active role in the development of pulp and paper industry in India. The entire capital of the Corporation is owned by the President of India, vide Ext. 12. It is to be stated in this connection that the Nagaland Company is equally a government company, being a subsidiary of the Corporation. The Memorandum and Articles of Association of the Nagaland Company, ext. B, shows that the entire share-capital of the Nagaland Company is held by the Corporation and the Governor of Nagaland. The provisions in Article 4 (a), 4 (b), 4 (c), 4 (d) and 23 of the Articles of Association of the Nagaland Company show that the Corporation and the Governor of Nagaland exercise control over the Nagaland Company. The overall control lies with the Central Government which can, under article 37 of Che Memorandum of Association, issue directions or instructions through the President of India regarding finances, conduct of business and the affairs of the Company. It is in the evidence of D. W. 1 that the Nagaland Company has a separate entity, though it is a subsidiary of the Corporation. The Managing Director of the Corporation and the Nagaland Company is the same. The Nagaland Company has its own rules as to employment. The Nagaland company recruits lower categories of employees. The officers of the Nagaland company are, according to D. W. 1, recruited by the Corporation. 8. THE question is whether, in the aforesaid circumstances, the services of the respondent could be transferred by the Corporation to the Nagaland Company. Transfer is undoubtedly an insident of service and court refuses to interfere with an order of transfer for the sake of better administration by any company or even public sector undertaking. This is not, however, a case wherein the transfer was from one branch or unit of the Corporation to another branch or unit of the Corporation. This was a case of transfer from the Corporation to its subsidiary company. This is not, however, a case wherein the transfer was from one branch or unit of the Corporation to another branch or unit of the Corporation. This was a case of transfer from the Corporation to its subsidiary company. It is not disputed that at the time of the transfer the respondent was in the scale of Rs. 1300-1700 and had reached the upper most limit of that scale. The personal guide for executives of the Corporation. Ext. 12, shows the existence of a scale of Rs. l100-50-1600 and thereafter another scale of Rs, 1300-50-1700. The next scale in the. Corporation was Rs. 1500-2000. The organisational chart of the Nagaland Company, Ext. 13, does not show any scale of rs. l300-1700 for assistant Project Officer. It has a scale of Rs. l300-1700 on operational side (vide D. W. 1. The respondent was. transferred as Shift-in-charge, for which the scale of pay is Rs. 1 100-1600. Though the pay of the respondent was protected by the order for transfer, ext. 2 (b), as his personal pay, there is nothing in the order for transfer to show that there will be no loss of seniority in the respondent's substantive rank if the respondent joined the Nagaland Company. Judged by the test of "right to the rank", the order of transfer, Ext. 2 (b), is clearly an order of demotion. Though the respondent was holding post of Assistant Project Officer in a substantive capacity in a scale of Rs. 1300-1700, he was transferred to a lower post in the scale of rs. 1100-1600/-, in a subsidiary company, which had its own service rules. The service rules of the Corporation did not apply to the Nagaland Company. This is evident from Rule 2 (v) of the service rules of the Corporation, Ext. C. The service-rules of the Corporation dc not apply to employees of the subsidiary companies unless these rules are adopted by the Boards of Directors of the subsidiary companies. There is nothing to show that: the service-rules of the Corporation were adopted by the Nagaland Company. The minutes of the 29th meeting of the Board of Directors of the Company held on 30. 5. 77, ext. There is nothing to show that: the service-rules of the Corporation were adopted by the Nagaland Company. The minutes of the 29th meeting of the Board of Directors of the Company held on 30. 5. 77, ext. F, go to show that the Chairman of the Nagaland- Company informed in that meeting that the Corporation had already issued advertisements for recruitment of technical/other officers for the project and that it would be possible to select them shortly. There is no evidence that any Shift -in -charge i)Paper Machine) of the Nagaland Company was recruited by the Corporation on the basis of this Board Meeting of the Nagaland Company. On the other hand, the respondent, holding a substantive post in the scale of Rs. 1300-1700, was transferred to the Nagaland Company in a lower post or rank having a lower stage in the pay-scale. There was thus reduction in rank of the respondent in the physical sense as the service rules of the Corporation did not apply to the Nagaland Company. There is no knowing if the seniority of the respondent in the service of the Corporation would have been protected in the Nagaland Company after the respondent joined the nagaland Company. There is also knowing, in the absence of production of the service-rules of the Nagaland Company, by the Corporation as to whether there would have been stoppage or postponement of future chance of promotion of the respondent in the Nagaland Company, if the respondent joined the Nagaland Company. Apart from reduction in rank in the physical sense, the transfer was thus of a penal nature, it will thus be a case of demotion as alleged by the respondent. The respondent is a public servant under section 21 (12) of the Indian Penal code. The respondent, in the service of a government company as defined in section 617 of the Companies Act, 1956, will be a public servant. As a public servant, the respondent cannot be transferred to a subsidiary company without protection of his seniority in service in the Corporation, or by postponement of his future chance of promotion. Mr. Ghosh and Mr. Banerjee both referred to the case of p. K. P. Bidi Factory v. O. 11. Thenge ( AIR 1970 SC 823 . The contention of Mr. Mr. Ghosh and Mr. Banerjee both referred to the case of p. K. P. Bidi Factory v. O. 11. Thenge ( AIR 1970 SC 823 . The contention of Mr. Ghosh is that, even though the respondent was transferred to the Nagaland Company, the Nagaland Company could not have dismissed the respondent and the respondent remained under the administrative control of the Corporation. This contention cannot be accepted. This is not a case of lending of the service of an employee to a third person, so that the original employment does not cease as per the decision in the case reported in AIR 1970 SC 823 . This is a case wherein the service of the respondent was transferred to a subsidiary company in a lower post without mention about protection of his seniority in his substantive post in the scale of Rs. 1300-1700. On the basis of the decision of the Supreme Court reported in AIR 1970 SC823, it cannot thus be stated that the respondent could not be effected by the order for transfer. It cannot be stated, in the aforesaid facts and circumstances, that there was no reduction in rank of the respondent as his pay was protected by the order for transfer. The decision of the Supreme Court in the case of M/s. Kundan Sugar mills v. Ziyauddin 1960 (2) SCR 918 , though a decision under the industrial Disputes Act, 1947, shows that if a person employed in a factory is transferred, to some other [independent concern started by the same employer at a stage subsequent to the date of his appointment, the transfer will not be proper. The transfer of the repondent on the basis of Rule 11 of the Service rules of the Corporation were adduced by the respondent (P. W. I) about his lack of knowledge of the service-rules, ext. C It is not necessary to discuss these evidences of P. W. i, which are controverted by D. W. I. Assuming for the sake of argument that the respondent was aware of the provisions of these service-rules of the Corporation, Ext. C It is not necessary to discuss these evidences of P. W. i, which are controverted by D. W. I. Assuming for the sake of argument that the respondent was aware of the provisions of these service-rules of the Corporation, Ext. C, the fact remains that as the transfer was not from one department or any unit of the Corporation to another department or unit of the Corporation but to an entirely different legal entity, though a subsidiary company of the Corporation, the transfer cannot be proper as lit involved reduction in rank with penal consequence, The next point for decision this appeal is whether the Civil court can grant a declaration that the order for transfer is void, illegal, inoperative and unenforceable under the terms and conditions of his employment, as prayed for by the respondent. Mr. Ghosh has referred us to the case of Salil Kumar Mukherjee v. Hindusthan Steel ltd. 1978 (2) CLJ 417 and has contended that on the basis of the division Bench decision of this court, the respondent cannot claim any declaration in the suit, as prayed for. The contention is that thodrigot claimed by the respondent flows from his contract of service and not for any legal character. It is contended that as the right originates in or flows from a contract of service, such right cannot form the subject-matter of a declaration under section 34 of the Specific relief Act. In the case of Salil Kumar Mukherjee (supra), the suit was filed for declaration that seniority should be calculated from the date of appointment under the Hindusthan Steel Limited. The plaintiffs in that suit were employees of one unit under the Hindusthan Steel ltd. The case of the plaintiffs in that suit was that they had legal character and could ask for the declaration under section 34 of the specific Relief Act. It was decided in that case that section 34 of the Specific Relief Act could not be attracted as the plaintiffs were employees of Hindusthan Steel Limited, which was a Government of India Undertaking and was a company registered under the Companies act, 1956. It was further held in that case that the position of the plaintiffs in that suit was not better than the employees under a private employer. It was further held in that case that the position of the plaintiffs in that suit was not better than the employees under a private employer. After the decision of the Supreme Court in the case of workmen of Hindusthan Steel Ltd. v., Hindusthan Steel Ltd. ( AIR 1985 sc 251 .) and the case of Central 1nland Water Transport Corporation limited (supra), it can no longer be urged that the Hindusthan Steel limited was a private employer. On the authority of the Division bench decision of this Court in the ca. se of Salil Kumar Mukherjee (supra), the respondent's suit cannot thus be defeated. Mr. Ghosh has next contended, by referring to the decisions of the Supreme Court in the cases of Kulchhinder Singh v. Hardayal Singh ( AIR 1976 SC 2216 ), Sirsi Municipality v. C. K. F., Tellis ( AIR 1973 SC 855 ), Vaish degree College v. Lakshmi Narayan ( AIR 1976 SC 888 ) and 3. Tiwari v. jawala Devi Vidya Mandir ( AIR 1981 SC 122 ), that Civil Court discussed the difficulty in enforcing specifically contracts for personal service in view of the provisions in sections 14 (l) (b) and 14 (l) (d) of the Specific Relief Act, 1963. The present suit is not, however, governed by section 34 of the Specific Relief Act. A decree which has the effect of giving relief besides serving to define rights is not a declaratory decree. Declaratory decrees which merely serve to define rights, present or future, without giving present relief, are governed entirely by old section 42 of the Specific Relief Act, 1877 (present section 34 of the Specific Relief Act, 1963. Where the decree has the effect of giving present relief as well, the powers to make it will be governed by the general provisions of the Code of Civil Procedure, such as section 9 or Order 7 or Rule 7 of the Code of Civil procedure and not by section 34 of the Specific Relief Act, (Md. Manjural Haque v. Bisseswar Banerjee AIR 1943 Calcutta 361. Manjural Haque v. Bisseswar Banerjee AIR 1943 Calcutta 361. In the case of Vemareddi Rammaraghayya Reddy v. Konduru Seshu ( AIR 1967 sc 436 ), it has been held by the Supreme Court that a declaration that a compromise decree is not binding on the deity is itself substantial relief and his immediate coercive effect and that such a declaration fails outside the purview of old section 42 of the Specific Relief act and would be governed by general provisions in the Code of Civil procedure such as section 9 or Order 7 Rule 7. In the case of Siten bose v. Ananda Bazar Patrika 1980 (II) CHN 99 = 84 CWN 545, it has been held by a Division Bench of this Court that old section 42 of the Specific Relief Act is not extensive of the cases in which a declaratory decree may be made and that courts have, power to grant such a decree independently of the requirement of that section. Mr. Ghosh has challenged this decision of this Court on the ground that this decision is contrary to the decision of the Supreme Court in the case of Premier Automobiles v. K. S. Wadke (A1. R 1975 SC 2238. It is not necessary for disposing of this appeal to discuss as to whether the decision in the case of Siten Bose (supra) cannot be supported on the authority of the decision of the Supreme Court in The case of Premier Automobiles. The power of the civil court to make a declaration, apart from the provisions of section 34 of the Specific Relief act, has been recognised by the Supreme Court in the case of V. R. Reddy ( AIR 1967 SC 436 ), already referred to, provided such declaration had immediate coercive effect. In the present case a declaration that the order for transfer and the subsequent release order are void, illegal, inoperative and cannot be enforced, will have immediate coercive effect inasmuch as we are told that there is another suit pending between the parties and that the fate of that suit hangs on the result of this appeal. The plaintiff did not carry out the order for transfer (vide P. W. 1. The plaintiff did not carry out the order for transfer (vide P. W. 1. As for the decisions of the Supreme Court in the cases reported in AIR 1976 SC 2216 , AIR 1973 SC 855 , AIR 1976 SC 888 and AIR 1981 SC 122 , it is to be stated that a new vista has been opened by the decision of the; Supreme Court in the case of Central inland Water Transport Corporation Limited ( AIR 1986 SC 1571 . In that case the Supreme Court has gone to the extent of stating in paragraph 104 at page 1616 that a civil suit could have been filed for declaration that termination of service was contrary to law on the ground that Rule 9 (i) of the Central Inland Water Transport corporation Limited Service Discipline and Appeal Rules, 1979, was void. If such a civil suit is competent, as per the decision of the Supreme court, there is no reason why the present suit will not be competent for granting a declaration, as prayed for, when the order for transfer is actually an order for reduction in rank of a public servant and was unconscionable and opposed to public policy. The order for transfer was unconscionable as there was want of mutality, there being nothing on record to show what the service rules of the Nagaland Company actually were. The transfer is opposed to public policy under section 23 of the Constract Act inasmuch as it involved reduction in rank with penal consequence, though the respondent was a public servant. Mr. Ghosh has contended that the observation of the Supreme Court in paragraph 104 in the case of Central Inland Water Transport Corporation limited, is an obiter and is not binding. This contention cannot be accepted. Even an obiter dicta by the Supreme Court is binding on the High Court. Mr. Ghosh contended that if actually a civil suit for granting of a declaration, as prayed for in this suit, was maintainable in the civil court, there was no reason to observe further in paragraph 104 in the case of the Central Inland Water Transport Corporation limited (supra) that the civil court could not have ordered reinstatement as it would have amounted to granting specific performance of a contract of personal service. It is not necessary for disposal of this appeal to discuss as to whether reinstatement for wrongful termination of service not under Industrial Law could be ordered by the civil court, as this is not a case with any prayer for reinstatement in service. If a civil suit for declaration that termination of service of a public servant is contrary to law, as being opposed to public policy under section 23 of the Contract Act, could be filed in the civil court as per the decision in the Central Inland Water Transport Corporation limited, there is no reason why the present suit would not also be maintainable. It is to be stated, in this connection, that the provisions of section 23 of the Contract Act, were not considered in any of the cases referred to by Mr. Ghosh vis. AIR 1. 976 SC 2216, AIR 1973 sc 855 , AIR 1976 SC 888 , and AIR 1981 SC 122 . 9. MR. Ghosh has contended that unless Rule 11 of the Service-rules of the Corporation, Ext. C, is declared ultra vires in exercise of power under Article 226 of the Constitution by this court in a writ jurisdiction, civil court cannot grant declaration, as prayed for by the respondent. We have already stated that the respondent had moved this court under article 226' of the Constitution and that the interim order at first passed in that case was vacated and the Rule issued in that case was discharged on the ground that the respondent was an employee of government company. The position has since changed so far as the government companies are concerned, after the decision if the supreme Court in the case of Central Inland Water Transport Corporation limited (supra. If the employee of a government company, being a public servant under section 21 (12) of the Indian Penal Code, can now maintain a writ under Article 226 of the Constitution, there is no reason why the civil court will not be granting any declaration, as prayed for by the respondent, simply because the Rule previously issued under Article 226 of the Constitution at the instance of the respondent has been discharged. It is no doubt true that the civil court cannot strike down Rule 11 of the service-rules of the Corporation, ext. It is no doubt true that the civil court cannot strike down Rule 11 of the service-rules of the Corporation, ext. C. Even then, if the respondent is reduced in rank and is demoted by passing an order for transfer, which is unconscionable and opposed to public policy, there is no reason why the civil court cannot grant a declaration, as prayed for by the respondent. The court can undoubtedly take notice of subsequent events to shorten litigation, to preserve the rights of the parties and to sub-serve the ends of justice (M. Laxmi and Co. v. A. R. Deshpande AIR 1973 SC 171 ), 10. IT has been contended by Mr. Ghosh that the motive behind transfer was administrative. The transfer may be ordered for administrative reason. If it is however, of a penal nature, involving reduction in rank, the motive for the transfer will be immaterial. It has been contended that without granting further relief, declaration as prayed for by the plaintiff-respondent, cannot be granted, this contention cannot also be accepted. We are told that the plaintiff has already retired from service. ' There is thus no scope for granting any decree for permanent injunction, as prayed for by the respondent even then, as the declaration, as prayed for, will have immediate coercive effect, the declaration can be granted under the general provisions in section 9 and Order 7 Rule 7 of the Code of Civil Procedure, though not under section of the Specific Relief Act. 11. WE are, accordingly, of opinion that the appeal should be dismissed and the cross-objection should be allowed in part as no decree for permanent injunction could be passed. Though the court below granted a declaration that the order for transfer was void, illegal, inoperative and could not be enforced under the terms and conditions of the respondent's employment under the Corporation, the other-declaration regarding the release order dated 8. 5. 78 was not grantee by the court below. Mere declaration of the transfer order dated 17. 1. 78 being void, illegal, inoperative and unenforceable, will not serve any purpose unless the release order is also declared to be void, illegal, inoperative, arid unenforceable. 12. THE appeal is accordingly, dismissed and the cross-objections are allowed in part. It is thereby declared that the order for transfer dated. 17. 1,78 and the release order dated 8. 5. 1. 78 being void, illegal, inoperative and unenforceable, will not serve any purpose unless the release order is also declared to be void, illegal, inoperative, arid unenforceable. 12. THE appeal is accordingly, dismissed and the cross-objections are allowed in part. It is thereby declared that the order for transfer dated. 17. 1,78 and the release order dated 8. 5. 78 issued to the plaintiff-respondent is void, illegal inoperative and unenforceable under the terms and conditions of service of the respondent with the appellant company. Parties to bear their own costs of this appeal. 13. ON the verbal prayer of the learned Advocate for the appellant, certificate do issue that the case is fit for appeal to the Supreme court as it involves substantial question of law of general importance. Let the operation of this judgment be stayed for a period of two weeks after the Christmas vacation as verbally prayed for by the learned advocate for the appellant. Appeal dismissed.