Goetze (India) Ltd. , Bangalore v. H. R. Thimappa Gowda
2015-02-20
B.VEERAPPA, N.KUMAR
body2015
DigiLaw.ai
JUDGMENT : N. Kumar, J. : R.FA.No. 1475/2010 is filed by the defendants against the judgment and decree dated 24th June 2010 passed by the City Civil Court, Bangalore, in O.S.No.7383/1999, decreeing the suit of the plaintiff and directing the defendants to pay Rs. 26,76,000/- as damages and granting other consequential benefits. Plaintiff has also preferred Cross Objection No.9/2012 claiming a sum of Rs. 55 lakhs as damages in addition to what has been granted by the trial Court. 2. For the purpose of convenience, the parties are referred to as they are referred to in the original suit. 3. The plaintiff H.R. Thimmappa is a Diploma holder in Metallurgy. He joined the defendants' organisation viz., Goetze (India) Ltd., on 10.1.1980. He worked in different sections such as Sand Plant and Moulding, Melting and pouring, Shakeout and grinding and Centrifugal Castings sections. His hard and sincere work in the aforesaid sections of the Foundry up to 1985 earned him a promotion as an Engineer (JME). Subsequently, he was put as a shift incharge and there also he worked sincerely and meritoriously which earned him a promotion as a Senior Engineer (JM-3). In April 1992 he was promoted as Assistant Manager (M-3) of Foundry (Production). Thereafter, he was shifted to general shift and was entrusted with additional responsibility of defendant No.1 Foundry as ISO-9000 coordinator of Foundry. In that capacity he earned appreciation for his sincere efforts put therein in achieving the goal of ISO 9000. Thereafter, he was shifted to new foundry and was placed incharge of the same. In the year 1995, he further earned his promotion as a Deputy Manager. The plaintiff by his hard work and sincerity, coupled with utmost honesty completed department operative procedure, work procedure and documentation work and thereby successfully completed ISO 9000 Certification Audit. In 1993, a letter of appreciation followed by a gift voucher of Rs. 1,000/-was conferred on him. In 1994 he was placed in charge of a new foundry. He worked hard and developed different types of alloyed cast iron viz., IKA KVIG13 and 4 and F-14 materials and also shim castings for Federal Mogul of America. He also worked with company's two value Engineering team viz., Machine shop GI4 Sleeves, Multi Operation Project value Engineering team and GIL Foundry. Also GI-4 Sleeves Yield Improvement Value Engineering team.
He worked hard and developed different types of alloyed cast iron viz., IKA KVIG13 and 4 and F-14 materials and also shim castings for Federal Mogul of America. He also worked with company's two value Engineering team viz., Machine shop GI4 Sleeves, Multi Operation Project value Engineering team and GIL Foundry. Also GI-4 Sleeves Yield Improvement Value Engineering team. Both the said teams with whom plaintiff worked were successful and one team was declared as a winner and the other team as a runner in the competition held on 18.2.1999 by training department. When he was promoted as a Deputy Manager, he was put in Re-Engineering course and he successfully completed the same. In the year 1998, he was promoted as Manager (M-5). He was made as a Coordinator in ISO-9000 certification of 1st defendant's Foundry. The plaintiff completed successfully this ISO-9000 Certification also. He was drawing gross salary of Rs. 15,492/- and his net salary was Rs. 13,673/-. Beside the salary, he was drawing an additional amount of more than Rs. 1,600/- per month as the nature of work was managerial-cum-supervisory and as Assistant Manager. 4. The plaintiff submits that, throughout his service, at no point of time, he gave room for complaint against him. He was discharging his duties sincerely, honestly and without fear or favour of anybody and to the utmost satisfaction of his official superiors. There were no adverse remarks against him. If there were any remarks, they were not communicated to him. He had completed 19 years and 5 months of service with no black marks. But to his shock and surprise, on 2.7.1999, he was served with an order of termination of his services with the defendants' organization. Along with the communication, a crossed account payee cheque for a sum of Rs. 23,365/- was also handed over to him. In the said order, it is stated that, defendants have reviewed the plaintiffs performance and found that the same was not satisfactory, as such, they are unable to retain the plaintiff in the services of their organization. Therefore, according to the terms and conditions of plaintiff's employment, his services have been terminated with immediate effect and the plaintiff stood relieved from the duties immediately. The sum of Rs. 23,365/- was towards three months salary in lieu of notice. He was also asked to settle his accounts in full and final settlement after obtaining clearance.
Therefore, according to the terms and conditions of plaintiff's employment, his services have been terminated with immediate effect and the plaintiff stood relieved from the duties immediately. The sum of Rs. 23,365/- was towards three months salary in lieu of notice. He was also asked to settle his accounts in full and final settlement after obtaining clearance. On the date of termination, he was aged 50 years. As he has been thrown out from the service, he lost every chance of getting employment elsewhere admittedly either in Government service or in any private organisation with this black mark, the result of which is not only plaintiff, but also his family consisting of his wife and school and college going children were thrown to the streets with the begging bowls in their hands. Plaintiff has no other source and he is only sole breadwinner of the family. He contended, that none of the procedure has been followed by the defendants and it is not a termination simpliciter. A stigma is attached. Therefore, it amounts to misconduct. Without holding an enquiry and without hearing the plaintiff, an order of termination could not have been passed. Then, he has referred to the terms and conditions of his employment, particularly Clause 15(a) (i) to (xvi), Section 23 of the Indian Contract Act and Articles 16(1), 19(l)(f)and 21 of the Constitution of India. Then, he has narrated in detail how the dispute in Escorts and Goetze Administrative and Supervisory Staff House Building Co-operative Society Ltd., Yelahanka, Bangalore, is the cause for his dismissal. He has also set out the number of complaints filed by him against other office bearers and the complaints filed against him. Therefore, he filed a suit in O.S.No.7383/1999 for a declaration that the order of termination dated 30.6.1999 is illegal, unjust, arbitrary and the same is null and void and not binding on the plaintiff and for mandatory injunction to defendants 1 and 2 to reinstate the plaintiff into defendants' service and for other consequential reliefs. 5. After service of summons, defendants entered appearance. The 1st defendant filed detailed written statement. It was admitted that the plaintiff was employed as a Manager. He was working in managerial, supervisory and administrative capacity. He was not a workman as defined in Section 2(s) of the Industrial Disputes Act, 1947.
5. After service of summons, defendants entered appearance. The 1st defendant filed detailed written statement. It was admitted that the plaintiff was employed as a Manager. He was working in managerial, supervisory and administrative capacity. He was not a workman as defined in Section 2(s) of the Industrial Disputes Act, 1947. The suit filed by the plaintiff seeking to enforce the contract for personal service is barred by the provisions of the Specific Relief Act, 1963. Defendants 2 and 3 are neither necessary nor pro forma parties in the suit. Therefore, the suit is bad for misjoinder of parties. Plaintiff is neither a public servant covered by Article 311 of the Constitution of India nor is a workman under the Industrial Disputes Act, 1947. Therefore, the question of reinstatement, would not arise. Subsequently they have admitted in the written statement that, the employment of the plaintiff and the various functions which he has discharged from time to time and the promotions which he has earned in the course of his employment. They also admitted that his services came be terminated and three months salary in lieu of notice was sent to him. However, they have denied all other allegations which are made in the plaint. They have justified the order of termination passed. They contend that the plaintiff was an office bearer of the society from time to time. The society is a separate and distinct legal entity. Defendants have no control over the affairs of the society. Initiation of some proceedings between various members of the society is totally irrelevant. The pendency of criminal proceedings pertaining to the affairs of the society is a matter of record. The termination of services of the plaintiff had absolutely no nexus whatsoever with the affairs of the society or any dispute or proceedings relating to the affairs of the society. The services of the plaintiff were terminated as his performance was not found satisfactory and not on account of initiation or pendency of any legal proceeding relating to the society, its office bearers and members etc., The services had been terminated in accordance with the terms and conditions of his employment and it does not suffer from any infirmity as alleged. 6.
6. On the aforesaid pleadings, the trial Court framed the following four issues : (1) Whether suit brought in the present form is barred by the provisions of Specific Relief Act, 1963 as contended by the 1st defendant? (2) If not, does plaintiff's termination order dated 30.6.1999 issued by the 2nd respondent is illegal, unjust, arbitrary, null and void and not binding on him? (3) If so, is plaintiff entitled for the relief of declaration and relief of mandatory and permanent injunction as prayed for? (4) What decree or order? 7. Plaintiff examined himself as PW-1 and marked Exs.P-1 to P-21 - documents in support of his claim. One V.T. Narayan, the Ex-Chief Manager of the defendant company was examined as DW-1. On behalf of the defendants, no documents were marked. After hearing the learned counsel for the parties, on appreciation of oral and documentary evidence on record and after taking note of the various judgments on which reliance is placed, the trial Court held that, the order of termination dated 30.6.1999 issued by the 2nd defendant as illegal, unjust, arbitrary, null and void. Further the trial Court held that plaintiff is entitled for the relief of declaration and mandatory injunction as sought for i.e., reinstatement was ordered. Consequently it held that the suit of the plaintiff is maintainable. It awarded damages of Rs.7,65,216/-. It also awarded cost of the suit. 8. Aggrieved by the said judgment and decree of the trial Court dated 17th January 2004, defendants preferred an appeal before this Court in RFA.No.325/2004. This Court after hearing the parties, upheld the judgment of the trial Court in so far as declaring the order of termination dated 30.6.1989 as illegal, unjust arbitrary, null and void. However, the order of the trial Court directing reinstatement and awarding damages of Rs. 7,65,216/- was set aside. The application filed by the plaintiff i.e., IA-6 in the suit for amendment of the prayer seeking for damages was allowed. Thereafter, the matter was remitted to the trial Court with a direction to restore OS. No. 7383/99 for the limited purpose of quantification of damages. Further they directed the trial Court to frame issue with regard to quantification of damages and determination of damages award-able to the plaintiff, and afford an opportunity to both plaintiff, as well as, defendant to lead evidence in this regard.
No. 7383/99 for the limited purpose of quantification of damages. Further they directed the trial Court to frame issue with regard to quantification of damages and determination of damages award-able to the plaintiff, and afford an opportunity to both plaintiff, as well as, defendant to lead evidence in this regard. The defendants challenged the said judgment of this Court in Apex Court by preferring Special Leave to Appeal (Civil) No. 18703/2006. The Apex Court after hearing both the parties, referred the matter to Mediation Centre, Bangalore. When the mediation failed, Special Leave Petition came to be dismissed. With the dismissal of the Special Leave Petition, the judgment and decree passed by the trial Court attained finality. Consequently, the trial Court restored the suit to its original file and thereafter, framed the following issues : (1) What is the actual damage the plaintiff is entitled to? (2) What order? 9. The plaintiff in support of his claim, examined himself as PW-1 and produced Exs.P-18 to P-66 documents. On behalf of the defendants, one P.S. Kulkami was examined as DW-2 and Sanath Kumar M.N. was examined as DW-3 and produced 23 documents which were marked as Exs.D-1 to D-23. The trial Court on appreciation of the oral and documentary evidence, held that plaintiff is entitled for a sum of Rs. 1 lakh towards anxiety and worry, a sum of Rs. 23,76,000/- as damages at the rate of Rs. 18,000/- per month from 30.6.1999 - the date of termination till 24.6.2010 - the date of the judgment, which comes to 132 months. A sum of Rs. l lakh was awarded as damages towards time spent in establishing the claim. A sum of Rs. l lakh was awarded towards undergoing insults. The cost was also awarded. Thus, a sum of Rs. 26,76,000/- was awarded as total damages less the amount which is received. Aggrieved by the said judgment and decree of the trial Court awarding damages, the defendants are in this appeal. The plaintiff also has preferred a cross appeal claiming damages of Rs. 55,00,000/-. 10.
The cost was also awarded. Thus, a sum of Rs. 26,76,000/- was awarded as total damages less the amount which is received. Aggrieved by the said judgment and decree of the trial Court awarding damages, the defendants are in this appeal. The plaintiff also has preferred a cross appeal claiming damages of Rs. 55,00,000/-. 10. The learned counsel for the appellant-defendants by assailing the impugned judgment and decree passed by the trial Court contends that, after recording a finding that the plaintiff has miserably failed to prove that he has failed in his duty to mitigate the damages, the trial Court erred in awarding damages at the rate of Rs.18,000/- per month for 132 months. He submitted that absolutely there is no basis ' whatsoever with regard to awarding damages and in support of his contention, he relied upon various judgments. 11. Per contra, learned counsel for the plaintiff submitted that the evidence on record shows that the defendant has engaged the services of a detective agency to prosecute the plaintiff and whenever plaintiff made an attempt to secure an employment, defendant was successful in aborting such attempts. Because of the stigma attached in the order of termination, it came in way of the plaintiff securing an alternative employment. The documents produced by him Shows he borrowed money from banks, from credit cards and he was unable to repay the same. Only when the amounts were released in pursuance of the interim orders passed by this Court, he was able to discharge those debts. On the contrary, the defendant has hot produced any evidence to show that plaintiff was gainfully employed during this period and therefore, awarding of damages by the Court below cannot be found fault with. In fact, plaintiff has filed cross-objection stating that the damages should have been paid in accordance with the regulations prevailing in the organisation and by taking into consideration the remuneration paid to similarly placed persons and not a sum of Rs. 18,000/- as done by the trial Court while awarding damages. Therefore, he submits that the appeal preferred by the appellants-defendants is liable to be dismissed and cross-objection filed by the plaintiff is to be allowed and the damages as claimed to the tune of Rs. 55 lakhs is to be awarded. 12.
18,000/- as done by the trial Court while awarding damages. Therefore, he submits that the appeal preferred by the appellants-defendants is liable to be dismissed and cross-objection filed by the plaintiff is to be allowed and the damages as claimed to the tune of Rs. 55 lakhs is to be awarded. 12. In the light of the aforesaid facts and rival contentions, the points that arise for our consideration in this appeal are : (1) When the order of termination of employment is held to be illegal, how the compensation or compensation for loss or damage is to be assessed? (2) How the principle of mitigation of loss is applied in case of wrongful termination of service while assessing compensation or compensation for loss or damage? (3) Whether the damages awarded by the Tribunal to the plaintiff is in accordance with law, if not what is the damages to which the plaintiff is entitled to? Regarding Point Nos. 1 and 2:- 13. The facts are not in dispute. The plaintiff was working as a Manager on 30.6.1999 when his services came to be terminated on the ground that his service was unsatisfactory. On the date of termination, he was drawing a salary of Rs. 15,492/-. His net salary was Rs. 13,673/-. It is his case that he was drawing a sum of Rs. l,600/- per month as additional amount. On the date of his termination, he was aged about 50 years. In fact, his remaining service was 132 months. The order of termination is held to be illegal. It has attained finality. Therefore, the contract of employment between the plaintiff and defendants was illegally terminated. Consequently, the plaintiff is entitled to damages. Section 73 of the Indian Contract Act, 1872 provides for compensation for loss or damage caused by breach of contract. It reads as under: "73. Compensation for loss or damage caused by breach of contract:- When a contract has been broken, the party who suffers by such breach is entitled to receive, from the party who has broken the contract, compensation for any loss or damage caused to him thereby, which naturally arose in the usual course of things from such breach, or which the parties knew, when they made the contract, to be likely to result from the breach of it.
Such compensation is not to be given for any remote and indirect loss or damage sustained by reason of the breach. Compensation for failure to discharge obligation resembling those created by contract: - When an obligation resembling those created by contract has been incurred and has not been discharged, any person injured by the failure to discharge it is entitled to receive the same compensation from the party in default, as if such person had contracted to discharge it and had broken his contract. Explanation: - In estimating the loss or damage arising from a breach of contract, the means which existed of remedying the inconvenience caused by the non-performance of the contract must be taken into account." 14. Section 73 contains four paragraphs. The first paragraph deals with compensation for loss or damage caused by breach of contract. It states that where a contract is broken, the party suffering from the breach of contract is entitled to receive compensation from the party who has broken the contract. The compensation can be recovered for loss or damage, (i) that arose in the usual course of things from such breach; or (ii) which the parties knew at the time they made the contract, as likely to result from such breach. The second paragraph provides that no compensation is payable for any remote or indirect loss or damage. The third paragraph applies the same principles where breach occurs of obligations resembling contracts. The fourth paragraph provides that while assessing the damage, the means that existed with the person claiming damages for the inconvenience caused by non-performance, must be considered. 15. An action for damages is always available as a matter of right when a contract has been broken, as against the relief of specific performance, which lies in the discretion of the Court. The law imposes an obligation or implies the terms that upon breach of a contract, damages must be paid; that is also provided in plain terms by the section. In a suit to enforce a contract, it is necessary to ascertain its exact terms, so as to determine its breach. The section applies only where a contract has been broken; and breach of contract must be proved before setting about the question of damages. No damages can be awarded by the court without coming to any conclusion about breach.
In a suit to enforce a contract, it is necessary to ascertain its exact terms, so as to determine its breach. The section applies only where a contract has been broken; and breach of contract must be proved before setting about the question of damages. No damages can be awarded by the court without coming to any conclusion about breach. The rule that the party in breach of contract be placed as far as money can do it, in as good a situation as the contract had been performed, is qualified by one more principle which imposes on a plaintiff the duty of taking all reasonable steps to mitigate the loss consequent on the breach and debars him from claiming any part which is due to his neglect to take such steps. The plaintiff can recover no more than he would have suffered if he had acted reasonably. In assessing the damages for wrongful dismissal, the Court has to make two calculations: (i) what the position would have been if the old employment had run its full course? And (ii) what the plaintiff has done since his dismissal? 16. It is the duty of the plaintiff to act reasonably in mitigation of damages by taking reasonable steps to obtain other suitable employment. If he has acted reasonably and obtained new appointment, the court must calculate the sums received for his work during the run-off period. If he has not acted reasonably, the court must calculate the sums which lie might reasonably have been expected to receive, if he had acted reasonably. Then the damages are assessed by giving him the sum which he would have received in his old employment, less the sum deducted in mitigation of expenses. Even where the contract of employment was for a specific terms, the servant would, in that event, be entitled to damages, the amount of which would be measured prima facie and subject to the rule of mitigation, in salary of which the employer had deprived him and that servant would then be entitled to the whole of the salary benefits etc., which he would have earned, had he continued in the employment for the full term of the contract, subject of course, to mitigation of damages by way of seeking alternative employment.
In assessing the damages in such case, one has to see the period of employment, the nature of the job, the availability of suitable job, immediately or in the near future and the like to assess the damages. As to what means existed of remedying the inconvenience caused by the breach of the contract in mitigating the loss or damage therefrom is a question of fact to be seen in each case. The explanation does not cast any duty on the plaintiff to look for an alternative employment. If a suitable job existed, which the plaintiff did not take, the salary and perks in that job could certainly be taken into account while assessing the damages. It is not for the plaintiff to prove that other jobs were not available. Burden lies on the defendant to show that means existed to mitigate the loss and if it is so proved, the plaintiff cannot recover for a loss which he could have avoided. If the plaintiff gets or is able to get another job, the earnings in that job would have to be taken into account in assessing the damages. 17. In Halsbury's Laws of England (4th Edition) on the question of mitigation, it is held as under: "The plaintiff must take all reasonable steps to mitigate the loss which he has sustained consequent upon the defendant's wrong, and, if he fails to do so, he cannot claim damages for any such loss which he ought reasonably to have avoided." 18. Where the plaintiff does mitigate his loss he cannot recover damages in respect of that avoided loss even if the steps that he took to avoid the loss can be characterised as being more than what was reasonably necessary. The duty arises only upon the commission of a tort or breach of contract. In the case of a contract there is no duty to mitigate before the breach has occurred. Whether the defendant alleges that the plaintiff has failed to take all reasonable steps to mitigate his loss, the burden of proof is upon the defendants. The plaintiff is required only to act reasonably and whether he has done so, is a question of fact in the circumstances of each particular case, and not a question of law.
Whether the defendant alleges that the plaintiff has failed to take all reasonable steps to mitigate his loss, the burden of proof is upon the defendants. The plaintiff is required only to act reasonably and whether he has done so, is a question of fact in the circumstances of each particular case, and not a question of law. He must act not only in his own interests, but also in the interests of the defendants and keep down the damages, so far as it is reasonable and proper, by acting reasonably in the matter. 19. The Apex Court in the case of S.S. Shetty v. Bharat Nidhi, Ltd., reported in AIR 1958 SC 12 while dealing with the damages payable in cases of wrongful dismissal in the ordinary law of master and servant has held as under: "12. The position as it obtains in the ordinary law of master and servant is quite clear. The master who wrongfully dismisses his servant is bound to pay him such damages as will compensate him for the wrong that he has sustained. 'They are to be assessed by reference to the amount earned in the service wrongfully terminated and the time likely to elapse before the servant obtains another post for which he fitted. If the contract expressly provides that it is terminable upon, e.g., a month's notice, the damages will ordinarily be a month's wages No compensation can be claimed in respect of the injury done to the servant's feelings by the circumstances of his dismissal, nor in respect of extra difficulty of finding work resulting from those circumstances. A servant who has been wrongfully dismissed must use diligence to seek another employment, and the fact that he has been offered a suitable post may be taken into account in assessing the damages". (Chitty on Contracts, 21st Edn., Vol (2), p. 559 para 1040). 13. If the contract of employment is for a specific term, the servant would in that event be entitled to damages the amount of which would be measured prima facie and subject to the rule of mitigation in the salary of which the master had deprived him. (Vide Collier v. Sunday Referee Publishing Co. Ltd., (1940) 4 All ER 234 at p. 237(A).
(Vide Collier v. Sunday Referee Publishing Co. Ltd., (1940) 4 All ER 234 at p. 237(A). The servant would then be entitled to the whole of the salary, benefits, etc., which he would have earned had he continued in the employ, of the master for the full term of the contract, subject of course to mitigation of damages by way of seeking alternative employment. 14. Such damages would be recoverable by the servant .for his wrongful dismissal by the master only on the basis of the master having committed a breach of the contract of employment. If, however, the contract is treated as subsisting and a claim is made by the servant for a declaration that he continues in the employment of the master and should be awarded his salary, benefits, etc., on the basis of the continuation of the contract, the servant would be entitled to a declaration that he continues in the employment of the master and would only be entitled to the payment of salary, benefits, etc., which accrued due to him up to the date of the institution of the suit." 20. Again the Apex Court in the case of M/s. Murlidhar Chiranjilal v. M/s. Harishchandra Dwarkadas and another, reported in AIR 1962 SC 366 while dealing with the quantum of damages payable under Section 73 has laid down the following principles for determination of such compensation: "The two principles on which damages in such cases are calculated are well-settled. The first is that, as far as possible, he who has proved a breach of a bargain to supply what he contracted to get is to be placed, as far as money can do it, in as good a situation as if the contract had been performed; but this principle is qualified by a second, which imposes on a plaintiff the duty of taking all reasonable step" to mitigate the loss consequent on the breach, and debars him from claiming any part of the damage which is due to his neglect to take such steps: (British Westinghouse Electric and Manufacturing Company Limited v. Underground Electric Railways Company of London (1912)AC 673 at p.689). These two principles also follow from the law as laid down in Section 73 read with the Explanation thereof.
These two principles also follow from the law as laid down in Section 73 read with the Explanation thereof. If therefore the contract was to be performed at Kanpur it was the respondent's duty to buy the goods in Kanpur and rail them to Calcutta on the date of the breach and if it suffered any damage thereby because of the rise in price on the date of the breach as compared to the contract price, it would be entitled to be reimbursed for the loss. Even if the respondent did not actually buy them in the market at Kanpur on the date of breach it would be entitled to damages on proof of the rate for similar canvas prevalent in Kanpur on the date of breach, if that rate was above the contracted rate resulting in loss to it. But the respondent did not make any attempt to prove the rate for similar canvas prevalent in Kanpur on the date of breach. Therefore it would obviously be not entitled to any damages at all, for on this state of the evidence it could not be said that any damage naturally arose in the usual course of things." 21. The Apex Court in the case of M. Lachia Setty & Sons Ltd. v. Coffee Board, Bangalore, reported in AIR 1981 SC 162 while dealing with the determination of compensation payable under Section 73 of the Contract Act, taking note of the principle of mitigation of law has held as under: "At the outset it must be observed that the principle of mitigation of loss does not give any right to the party who is in breach of the contract but it is a concept that has to be borne in mind by the Court while awarding damages. The correct statement of law in this behalf is to be found in Halsbury's Laws of England (4th Edn.) Vol. 12, para 1193 at page 477 which runs thus: "1193. Plaintiff's duty to mitigate loss.
The correct statement of law in this behalf is to be found in Halsbury's Laws of England (4th Edn.) Vol. 12, para 1193 at page 477 which runs thus: "1193. Plaintiff's duty to mitigate loss. The plaintiff must take all reasonable steps to mitigate the loss which he has sustained consequent upon the defendant's wrong, and, if he fails to do so, he cannot claim damages for any such loss which he ought reasonably to have avoided." Again, in para 1194 at page 478 the following statement occurs under the heading 'Standard of conduct required of the plaintiff': 'The plaintiff is only required to act reasonably and whether he has done so is a question of fact in the circumstances of each particular case, and not a question of law. He must act not only in his own interests but also in the interest of the defendant and keep down the damages so far as it is reasonable and proper, by acting reasonably in the matter..........In cases of breach of contract the plaintiff is under no obligation to do anything other than in the ordinary course of business, and where he has been placed in a position of embarrassment the measures which he may be driven to adopt in order to extricate himself ought not to be weighed in nice scales at the instance of the defendant whose breach of contract has occasioned the difficulty............. The plaintiff is under no obligation to destroy his own property, or to injure himself or his commercial reputation, to reduce the damages payable by the defendant. Furthermore. the plaintiff need not take steps which would injure innocent persons." (Emphasis supplied). In Banco De Portugal v. Waterlaw & Sons, Ltd., 1932 All ER 181, Lord Shankey, L.C., quoted with approval the statement of law enunciated in James Finlay & Co. v. N.V. Kwik Hoo Tong, Handel Maatchappij, (1929) 1 KB 400, to the effect "In England the law is that a person is not obliged to minimise damages on behalf of another who has broken a contract if by doing so he would have injured his commercial reputation by getting a bad name in the trade." American Jurisprudence 2d, Vol. 22 para 33 (at pp. 55-56) contains the following statement of law: "33. The general doctrine of avoidable consequences applies to the measure of damages in actions for breach of contract.
22 para 33 (at pp. 55-56) contains the following statement of law: "33. The general doctrine of avoidable consequences applies to the measure of damages in actions for breach of contract. Thus, the damages awarded to the non-defaulting party to a contract will be determined and measured as though that party had made reasonable efforts to avoid the losses resulting from the default. Some courts have stated this doctrine in terms of a duty owing by the innocent party to the one in default; that is, that the person who is seeking damages for breach of contract has a duty to minimise those damages. However, on analysis, it is clear that in contract cases as well as generally, there is no duty to minimise damages, because no one has a right of action against the non-defaulting party if he does not reasonably avoid certain consequences arising from the default. Such a failure does not make the non-defaulting party liable to suit; it only indicates that the damages actually suffered are greater than the law will compensate. Therefore, in contract actions, the doctrine of avoidable consequences is only a statement about how damages will be measured." (Emphasis supplied). From the above statement of law it will appear clear that the non-defaulting party is not expected to take steps which would injure innocent persons. If so, then steps taken by him in performance or discharge of his statutory duty also cannot be weighed against him. In substance the question in each case would be one of the reasonableness of action taken by the non-defaulting party." 22. The Travancore-Cochin High Court in the case of Mookan Ouseph Thomakutty v. Thomas, reported in AIR 1954 Travancore-Cochin 104 has held as under: "15. The next aspect to be considered is as to the quantum of damages to be awarded in this case. In the statement Ex.M filed by the plaintiff he has estimated the damages sustained by him on account of his wrongful dismissal from service at Rs. 32,875. The basis of this estimate is that as per the contract of service he was entitled to be in service till his sixtieth year of age i.e., for a further period of 25 years from the date of his dismissal when he was only 35 years old.
32,875. The basis of this estimate is that as per the contract of service he was entitled to be in service till his sixtieth year of age i.e., for a further period of 25 years from the date of his dismissal when he was only 35 years old. He has assumed that he would have got the regular increments in his salary from time to time and stricking an average of such expected increase in salary, he has taken Rs. 100/- per month as his average salary for the purpose of the calculation made in the statement. Ex.M. Even if he were to retire on the completion of his 55th year, he would have had 20 years, service more to his credit and on that basis the salary which he would have got has been estimated at Rs. 25,000/-. After making such an estimate, he has limited his claim in the suit to Rs. 10,000/-. The lower Court has taken the view that the basis of the calculation adopted by the plaintiff is proper and acceptable and that therefore the full amount claimed by him has to be decreed. 16. The basis of the calculation adopted in Ex.M statement is clearly unsupportable in law. As already stated, there is no written agreement between the parties stipulating that the plaintiff shall be retained in service till he completes 55 or 60 years of age and that in the event of the termination of his services at an earlier period, the total amount of salary that he would have got for the remaining period would be paid to him by way of liquidated damages. All that can be said is that as per the custom and practise proved to govern the service of teachers in recognised private schools conducted in accordance with the provisions of the Cochin Education Code, the plaintiff could expect to be in service till the completion of his 55th year of age. At best an implied agreement could be inferred on the part of the management to retain him in service under normal circumstances until he completes his 55th year of age. But a wrongful dismissal from service resulting in a breach of that agreement will not entitle the plaintiff to get the total amount of salary which he would have got had he continued in service for the whole of the expected period, by way of damages.
But a wrongful dismissal from service resulting in a breach of that agreement will not entitle the plaintiff to get the total amount of salary which he would have got had he continued in service for the whole of the expected period, by way of damages. The possibility of continuance in service for the whole of such period cannot be asserted with certainty. The possibility of the termination of service at any time during that period, on account of death or of physical or mental disability or on account of other justifiable causes, cannot be ruled out. The assumption that there would have been a progressive increase in the salary of the plaintiff by regular increments and higher scales of pay on account of promotions, is equally bad for uncertainty. Promotions and the consequent increase in salary cannot be taken to be automatic, but can be expected to follow only from the acceptance of the service as satisfactory and creditable. The damages claimed on the basis of an anticipation or assumption of all these factors in favour of the plaintiff can only be termed as too remote, and such a claim will not be countenanced by a Court of law. 17. A servant complaining of wrongful dismissal from service cannot rest content by merely putting forward a claim for recovery in a lump and in advance the entire amount of anticipated salary covering the whole period for which he expected to continue in service so as to utilise such amount for safe investment and thus to convert the very injury complained of into a blessings in disguise. The common law which recognises his right to recover damages for wrongful dismissal imposes a corresponding duty on him to do all that is possible to mitigate such damages. He is bound to act in that direction not only in his own interest but also in the interests of the opposite party against whom he has to sustain an action for damages. He has to use due diligence in endeavouring to obtain suitable employment with wages approximating that which he was getting in the service from which he was dismissed, even though he is not expected to accept a fresh engagement in a lower status. The possible chance of obtaining a suitable employment elsewhere has to be taken into account in assessing the measure of damages to be awarded to the plaintiff.
The possible chance of obtaining a suitable employment elsewhere has to be taken into account in assessing the measure of damages to be awarded to the plaintiff. In the judgment of the House of Lords in 'Beckham v. Darke', (1848) 2 HLC 579 (F), the principles to govern a claim for damages for wrongful dismissal in violation of an agreement for service, have been stated thus: 'The measure of damages for the breach of promise now in question is obtained by considering what is the usual rate of wages for the employment here contracted for, and what time would be lost before a similar employment could be obtained. The law considered that employment in any ordinary branch of industry can be obtained by a person competent for the place, and that the usual rate of wages for such employment can be proved, and that when a promise for continuing employment is broken, it is the duty of the servant to use diligence to find another employment." Even where the service is not covered by a contract, the rule is that the service can be terminated only after reasonable notice except in cases where the dismissal is for proved misconduct or for other justifiable causes. The period of such notice will ordinarily be fixed as the time during which a fresh employment may reasonably be expected to be obtained. Thus in either case the anticipated salary or wages for an unreasonably long period subsequent to the date of the dismissal cannot be fixed as the measure of damages arising out of the wrongful dismissal. These principles have been embodied in Section 73, Contract Act also. It is stated in that section that 'such compensation is not to be given for any remote and indirect loss or damage sustained by reason of the breach." The Explanation to the section states as follows: "In estimating the loss or damage arising from a breach of contract the means which existed of remedying the inconvenience caused by the non-performance of the contract must be taken into account." The quantum of damages to be awarded in favour of the plaintiff in the present case have to be fixed in the light of these principles." 23.
The Madras High Court in the case of R.J. Mohammed Jacub Sahib v. The Indian Bank Ltd., Madras and another reported in AIR 11975 Madras 220 has quoted with approval, the following passage fram Mayne and McGregor on Damages: "6. In Mayne and McGregor on Damages, in para 158 at page 145, it is observed: - "Although the plaintiff must act with the defendant's as well as with his own interest in mind, he is only required to act reasonably and the standard of reasonableness is not high in view of the fact that the defendant is an admitted wrongdoer." Then in that book the observations of Lord Macmillan in Banco de Portugal v. Waterlow, 1932 AC 452 have been quoted with approval. In that case, Lord Macmillan said- "Where the sufferer from a breach of contract finds himself in consequence of that breach placed in a position of embarrassment the measures which he may be driven to adopt : in order to extricate himself ought not to be weighed in nice scales at the instance of the party whose breach of contract has occasioned the difficulty, it is often easy after an emergency has passed to criticise the steps which have been taken to meet it, but such criticism does not come well from those who have themselves created the emergency. The law is satisfied if the party placed in a difficult situation by reason of the breach of a duty owed to him has acted reasonably in the adoption of remedial measures and he will not be held disentitled to recover the cost of such measures merely because the party in breach can suggest that other measures less burdensome to him might have been taken." 24. The Delhi High Court in the case of S.M. Murray v. M/s. Fenner India Ltd., reported in AIR 1986 Delhi 427 after referring to the judgment of the Apex Court in the case of S.S. Shetty ( AIR 1958 SC 12 ) as well as Travancore-Cochin High Court in the case of Thomakutty referred to supra held as under: "(23) At this stage, I may note the evidence which has come on record in the present case.
The plaintiff, in answer to a court question as to whether he tried to get any alternative employment, said that he did not because after crossing the age of 50, it was not possible to get a suitable employment. He also said that he made no efforts to get alternative employment and also that between the period 21-1-1984 and 11-8-1985 when he was in Delhi he had been applying for employment but could not get any employment. He said that he was being offered emoluments much lower than what he was getting and also the employment offered was not having the same status which he was enjoying in the service of the defendant. In answer to a question in cross-examination, the plaintiff gave names of three companies to whom he had applied for employment. He said that though he received letters from these firms, he told them that he could join only after 1986. The plaintiff also said that for the first time he received offer from M/s. Hilton Rubber Industries Ltd. in January 1985, when that company asked the plaintiff as to what he was getting from the defendant. The plaintiff informed that company that he was getting Rs. 5,000.00 plus perks and if he was paid the same amount he would join that company. The plaintiff did not receive any offer thereafter. (24) It, therefore, appears to me that if there was any burden or duty cast on the plaintiff not to sit idle and to try to look for an alterative employment in order to minimise the loss or damage arising from the breach of the contract he did discharge his burden or the duty. Though the plaintiff did say that he informed the companies from which he received letters that he would join them in 1986, there was no firm offer and he was not getting suitable employment. It has come on record that the plaintiff is a rubber technologist. He is B.Sc. and is holding Diploma in Polymer Technology from U.K. The plaintiff said that he was basically a tyre-man and a tyre manufacturing specialist and that he developed special technology for the manufacture of V-belts and auto fan belts." 25.
It has come on record that the plaintiff is a rubber technologist. He is B.Sc. and is holding Diploma in Polymer Technology from U.K. The plaintiff said that he was basically a tyre-man and a tyre manufacturing specialist and that he developed special technology for the manufacture of V-belts and auto fan belts." 25. Dealing with the question of damages or salary payable to such dismissed employee, the Apex Court in the case of The Kayastha Pathshala, Allahabad and another v. Rajendra Prasad and another reported in AIR 1990 SC 415 after referring to the three decisions of the Apex Court in the case of Vaish Degree College v. Lakshmi Narain reported in AIR 1976 SC 888 , in case of Smt. J. Tivari v. Smt. Jawala Devi Vidya Mandir, reported in AIR 1981 SC 122 and in case of Deepak Kumar Biswas v. The Director of Public Instructions reported in AIR 1987 SC 1422 and after noticing the law laid down therein, held that the reinstatement would be an unwise move. From any point of view, the Court must have regard to circumstances in the academic atmosphere and radically change the position of the individual staff to be reinstated and if the declaration sought for namely as his termination was held to be invalid, he is deemed to have been in service then, the master would have to pay a very huge amount running into lakhs of rupees or perhaps more, as a result of which, the institution would be completely wiped out. It would undoubtedly work serious injustice to the master and is likely to destroy its very existence. The difficulty of obtaining alternative employment is an argument which cannot be permitted to a person, who has made no efforts to obtain any employment. Taking into consideration the aforesaid decision of law, the Supreme Court proceeded to award salary of three years on ground of damages. 26. Thus, the law on mitigation of damages could be summarised as under: The master who wrongfully dismisses his servant is bound to pay him such damages as will compensate him for the wrong done to him. The measure of damages for the breach of promise is obtained by considering what is the usual rate of wages for the employment contracted for, and what time would be lost before a similar employment could be obtained.
The measure of damages for the breach of promise is obtained by considering what is the usual rate of wages for the employment contracted for, and what time would be lost before a similar employment could be obtained. The damages are to be assessed by reference to the amount earned in the service wrongfully terminated and the time likely to elapse before the servant obtains another post for which he fitted. If the contract expressly provides that it is terminable upon, e.g., a month's notice, the damages will ordinarily be a month's wages. If the contract of employment is for a specific term, the servant would then be entitled to the whole of the salary, benefits, etc., which he would have earned had he continued in the employment of the master for the full term of the contract, subject of course to mitigation of damages by way of seeking alternative employment. Such damages would be recoverable by the servant for his wrongful dismissal by the master only on the basis of the master having committed a breach of the contract of employment. The damages awarded to the non-defaulting party to a contract will be determined and measured as though that party had made reasonable efforts to avoid the losses resulting from the default. The servant would in that event be entitled to damages the amount of which would be measured prima facie and subject to the rule of mitigation in the salary of which the master had deprived him. 27. The principle of mitigation of loss does not give any right to the party who is in breach of the contract but it is a concept that has to be borne in mind by the Court while awarding damages. The common law which recognises his right to recover damages for wrongful dismissal imposes a corresponding duty on him to do all that is possible to mitigate such damages. He is bound to act in that direction not only in his own interest but also in the interests of the opposite party against whom he has to sustain an action for damages. He has to use due diligence in endeavouring to obtain suitable employment with wages approximating that which he was getting in the service from which he was dismissed, even though he is not expected to accept a fresh engagement in a lower status.
He has to use due diligence in endeavouring to obtain suitable employment with wages approximating that which he was getting in the service from which he was dismissed, even though he is not expected to accept a fresh engagement in a lower status. The plaintiff must take all reasonable steps to mitigate the loss which he has sustained consequent upon the defendant's wrong, and, if he fails to do so, he cannot claim damages for any such loss which he ought reasonably to have avoided. The plaintiff is only required to act reasonably, and whether he has done so is a question of fact in the circumstances of each particular case, and not a question of law. He must act not only in his own interests but also in the interests of the defendant and keep down the damages, so far as it is reasonable and proper, by acting reasonably. 28. A servant complaining of wrongful dismissal from service cannot rest content by merely putting forward a claim for recovery in a lump and in advance the entire amount of anticipated salary covering the whole period for which he is expected to continue in service so as to utilise such amount for safe investment and thus to convert the very injury complained of into a blessings in disguise. The possibility of continuance in service for the whole of such period cannot be asserted with certainty. The possibility of the termination of service at any time during that period, on account of death or of physical or mental disability or on account of other justifiable causes, cannot be ruled out. The assumption that there would have been a progressive increase in the salary of the plaintiff by regular increments and higher scales of pay on account of promotions, is equally bad for uncertainty. Promotions and the consequent increase in salary cannot be taken to be automatic, but can be expected to follow only from the acceptance of the service as satisfactory and creditable. The anticipated salary or wages for an unreasonably long period subsequent to the date of the dismissal cannot be fixed as the measure of damages arising out of the wrongful dismissal. A servant who has been wrongfully dismissed must use diligence to seek another employment, and the fact that he has been offered a suitable post may be taken into account in assessing the damages. 29.
A servant who has been wrongfully dismissed must use diligence to seek another employment, and the fact that he has been offered a suitable post may be taken into account in assessing the damages. 29. It is in the background of these legal principles enunciated, we have to assess the quantum of damages to be awarded to the plaintiff. Regarding Point No. (3) 30. In the instant case, the contract of employment has been wrongfully terminated by the defendants and therefore, the said wrongful termination of employment entitles the plaintiff to claim damages. In order to determine the said damages, we have to look into the terms of the contract entered into between the parties. 31. The letter of appointment by which the plaintiff was appointed is marked in the case as Ex.D.l which is dated 21st December 1979. His appointment came into effect from 10th of January, 1980. He was on probation for a period of 6 months. After the expiry of the said period, he has been confirmed. He was working at Yelahanka, Bangalore. Under the terms of the employment, he is entitled to the benefit of provident fund, family pension and leaves. He was liable to be transferred to any place of business in the company. Clause 12 of the terms and conditions of the appointment which speaks about the retirement reads as under: "12. Retirement: As per rules, normally you may, at the option of the Company, be retained in service upto the age of 58 years. However, it is clearly understood and it shall always be deemed to be a condition of employment that the Company may terminate your services without assigning any reason for such termination provided that a notice for a period of one month or salary in lieu of such notice, has been given to you". 32. The aforesaid provision makes it clear that, he could continue in service at the option of the company i.e., the defendants. The contract provided for termination of the plaintiff's service without assigning any reason. The only pre-condition is a notice for a period of one month or salary in lieu of such notice has to be given. Therefore, this contract of employment is not for any definite period. The contract provided for termination of his employment without assigning any reason with either one month's notice or one month's salary in lieu of such notice.
The only pre-condition is a notice for a period of one month or salary in lieu of such notice has to be given. Therefore, this contract of employment is not for any definite period. The contract provided for termination of his employment without assigning any reason with either one month's notice or one month's salary in lieu of such notice. As the termination did give reasons i.e., as his service was not satisfactory, it amounted to termination on the ground of misconduct. Neither the principle of natural justice was followed nor was the enquiry conducted. The plaintiff was not heard before passing of the order of termination. Therefore, the said termination was held to be illegal and wrongful. It is because of wrongful termination of service, he is entitled to damages/compensation. 33. If the contract of an employee had provided a certain period and if his services are terminated before that period, then the measure of damages payable would be the remuneration paid to him for the remaining period of his service. In the instant case, though normally he could have continued in service up to the age of 58 years, the option was that of the defendants and not of the plaintiff. In other words, he was holding the said post at the pleasure of the defendant. The contract further provided that his services could be terminated without assigning any reason and if his contract has been terminated, in that manner no compensation was payable under the terms of the contract. All that was expected is to issue one month's notice. If the notice is not issued, one month's salary in lieu of notice had to be paid. Now by virtue of this wrongful termination of his service, he has challenged the said termination in a Court of Law. Not only did he want the order of termination to be set aside but also wanted reinstatement and other consequential benefits such as damages and compensation. The trial Court decreed the suit as prayed. 34. However, in appeal, this Court though upheld the finding of wrongful termination but set aside the order of reinstatement and remitted the matter to the trial Court for determination of the damages payable on account of wrongful termination. In the process, the plaintiff was kept away from employment. On the contrary, he has been spending time and money in fighting this litigation. 35.
In the process, the plaintiff was kept away from employment. On the contrary, he has been spending time and money in fighting this litigation. 35. Now the question for our consideration is: after his termination, what has he done to mitigate the damages which he has sustained? 36. The burden of proving that the plaintiff was gainfully employed is on the defendant. Similarly the burden of proving that the plaintiff has not done any act to mitigate the damages is also on the defendant. But at the same time, an obligation is cast on the plaintiff to mitigate the damages as is clear from the explanation to Section 73 of the Contract Act which provides that in estimating the loss or damage arising from a breach of contract, the means which existed of remedying the inconvenience caused by the non-performance of the contract must be taken into account. The plaintiff being conscious of the obligation cast upon him by law has made an attempt to discharge the burden cast on him. In his evidence in examination-in-chief which is filed by way of an affidavit at para-10, he has stated as under: "10. I submit that ever since 30.6.1999 when was illegally terminated, the Defendants have deliberately ensured that I do not get employment in any other organization. After my wrongful termination by the Defendant I had secured employment with a company called Bangalore Malleable Private Limited. The officials of the Defendants became aware of this and due to their intervention and giving of false information to my prospective employers. Similarly I would appear for interview at the various places and the defendants with mala fide and oblique motive solely with an intention to harass me would intervene and by giving false information to my intending employers would ensure that I do not secure employment in the organisations where I give my interview. Accordingly, the officials of the defendant tried to ensure to their best of their ability not to allow me to get employment and hence I was unable to secure any alternative employment." In the cross-examination, he has answered as under: "Now a document is shown alleged to be issued by Bangalore Malable Castings Private Limited. I never worked in Bangalore Malable Castings Private Limited. I have made my efforts to get a job but my image was already spoiled as terminated Manager, hence I could not secure job.
I never worked in Bangalore Malable Castings Private Limited. I have made my efforts to get a job but my image was already spoiled as terminated Manager, hence I could not secure job. I cannot remember I produced the letter issued by Bangalore Malable Castings Pvt. Ltd., rejecting to give me a job. My superannuation age completes in the year 2010, if I had remained in company. My date of birth is 24.1.1952. It is true to suggest that there may be chances that employees may not complete the superannuation age because of accident and casualties. There may chances the employees might take VRS or resign the job for the reasons known to them. There is likelihood of termination of Employees by employer by taking disciplinary action." 37. From the aforesaid material on record, it is clear that the plaintiff secured employment with a company called Bangalore Malleable Private Limited. Even if the said employment was terminated because of the efforts made by the defendants, in order to substantiate the said allegations, the plaintiff was expected to produce the order of appointment issued by the Bangalore Malleable Private Limited, the salary which they had agreed to pay, the date of termination and the reasons for termination. All these are not forthcoming. It is a settled law in assessing the damages payable for wrongful termination of service, if the plaintiff has secured an alternative employment, the salary he received in the alternative employment should be taken into consideration while determining the compensation payable. The said amount has to be deducted out of the amount which the plaintiff is entitled to as damages, if he had been employed. The plaintiff has withheld that information which is in his possession. Thus depriving this Court as well as the trial Court by arriving at correct amount of compensation payable to the plaintiff for wrongful termination of the service. The only inference that could be drawn is, if that material has been produced before the Court that would be against the defendant which would negative the claim in the suit. It was contended that as the termination order was passed with a stigma attached, the plaintiff was unable to secure an alternative employment.
The only inference that could be drawn is, if that material has been produced before the Court that would be against the defendant which would negative the claim in the suit. It was contended that as the termination order was passed with a stigma attached, the plaintiff was unable to secure an alternative employment. Secondly the defendants engaged the services of the private detectives to approach the employers whom the plaintiff had approached for employment and give them this information that his services were not satisfactory and therefore, his services came to be terminated and thereby in spite of best efforts made by the plaintiff, he could not secure an alternative employment. Thus he was prevented by the defendants from their conduct making it difficult for the plaintiff to mitigate damages. 38. In order to appreciate this point, reliance was placed on die documentary evidence produced in this case. Ex.P.56 is a letter written by Advance Group Private Detective Surveillance agent Recovery Service to the defendants on 1st of June, 2001. It relates to confidential assignment in respect of gainful employment of the plaintiff which states that in the first month, they have carried out strict surveillance and shadowing of the individual which did not reveal much about his engagement. Subsequently, once he was spotted at M/s. BMCL., and confirmed that he is employed there on a full time basis. They crosschecked the same with the employer and it was confirmed. They have also recorded his telephonic conversation which confirms that he is working at M/s. BMCL., and further looked for better jobs. Ex.P.57 is a complaint addressed by the plaintiff to the Police Inspector, Yelahanka New Town, Bangalore complaining that 4 persons on bike were watching him. As his case was pending between him and the defendants, he would suspect those people are watching him at the instance of the respondents/defendants. Therefore, he requested for appropriate action against them. Thereafter, the police took up investigation and one Umesh, who was interrogated, gave a statement that he is working in the People's Choice Security System and he is entrusted with a job to follow the plaintiff and collect information regarding his gainful employment. Similarly one A. Keshava Murthy also has deposed to the same effect which is at Ex.P.59.
Thereafter, the police took up investigation and one Umesh, who was interrogated, gave a statement that he is working in the People's Choice Security System and he is entrusted with a job to follow the plaintiff and collect information regarding his gainful employment. Similarly one A. Keshava Murthy also has deposed to the same effect which is at Ex.P.59. Thereafter R.G. Sharma, the Manager of the investigating agency admitted that they had carried out such exercise and they agreed to suspend the operations. Thus the documents on which plaintiff is relying on clearly demonstrates that the plaintiff was gainfully employed after his termination. The investigating agency was able to get that information which again shows that the plaintiff had secured an alternative employment. If the defendants had engaged the services of a detective, that is the only mode in which the defendants could get information about his alternative employment which they wanted to make use of in the pending litigation where the burden of proving that the plaintiff is gainfully employed is on them. They cannot be found fault with. The aforesaid materials do not establish that the defendants engaged the services of the private detectives to inform the intending employers of the plaintiffs not to give him employment. The learned Counsel submits that the allegations made to that effect by the plaintiff in his examination-in-chief is not controverted to in the cross-examination and therefore, it is deemed to have been accepted. We find it difficult to accept that submission. We have set out the above evidence in examination-in-chief as well as the evidence in cross-examination which has to be read together. Merely because one sentence in the examination-in-chief is not traversed in cross-examination that does not mean that what has been stated in the examination-in-chief is held to be proved. It is the substance of the evidence which has to be taken into consideration and a finding has to be recorded on the basis of such evidence. 39. Here is a case where the plaintiff admits in his examination-in-chief about securing a job but denies it in the cross-examination and that when he was confronted with the documents, he goes to the extent of making sweeping allegations against the defendants which he has failed to establish by any acceptable evidence.
39. Here is a case where the plaintiff admits in his examination-in-chief about securing a job but denies it in the cross-examination and that when he was confronted with the documents, he goes to the extent of making sweeping allegations against the defendants which he has failed to establish by any acceptable evidence. Therefore, the evidence on record shows that the plaintiff did obtain alternative employment, but he is withholding the information regarding the extent of his earning in the alternative employment. 40. From the aforesaid evidence on record, it is clear that the contract of employment is not for any specific period. The contract of employment could be terminated without assigning any reason. In fact the admissions of the plaintiff in the cross-examination shows that in the establishment, employees had been retired before attaining the age of superannuation, some of them have taken VRS, some of them have been terminated for their misconducts after disciplinary enquiry. All these go to show that merely because the plaintiff was wrongfully terminated, the plaintiff is not entitled to the salary which he would have drawn, if he had continued in service till he attained the age of superannuation. Though the plaintiff was drawing a salary of Rs. 15,492/- p.m. and his net salary was Rs. 13,637/- p.m. as on the date of his termination, the trial Court has proceeded to award damages on the basis that he was drawing a salary of Rs. 18,000/- p.m. for which we find no basis. At the same time, if the plaintiff had continued in service certainly he would have drawn much more than the salary he was drawing on the date of termination and also would have been entitled to higher salary, if he had earned promotions as he had earned earlier. That is precisely the claim which the plaintiff has put forth by way of cross-objection. 41. The evidence on record shows that the plaintiff claimed a sum of Rs. 2 crores and in the examination-in-chief, he has restricted the same to Rs. 55 lakhs and the trial Court has granted the compensation of Rs. 26 lakhs all of which has no basis. Added to that, the plaintiff has withheld from the Court, the salary he has drawn in the alternative employment. Nearly 132 months of service he had before attaining the age of superannuation.
55 lakhs and the trial Court has granted the compensation of Rs. 26 lakhs all of which has no basis. Added to that, the plaintiff has withheld from the Court, the salary he has drawn in the alternative employment. Nearly 132 months of service he had before attaining the age of superannuation. Even in the Industrial Law where statute gives protection to a workman, a principle of no work no pay is well accepted. Even if the termination is held to be wrongful and he is ordered to be reinstated, back wages is not automatic. In the ordinary law, the principles of mitigation of damages has to be kept in mind while determining the compensation payable. Our job has been made difficult by the plaintiff, by keeping away from the Court the salary which he was drawing in the alternative employment. 42. Yet another factor which has to be kept in mind is, if really the plaintiff was a performer as sought to be made out from the various promotions which he has earned and with 20 years of experience behind him, he being a technician, certainly he would have great demand and he would have secured probably a better employment than that what he had with the defendants. If his evidence that because he was a terminated employee and because of the stigma, he could not secure any employment at all, the stigma which was attached to him is only that his work was not satisfactory and therefore his contention because of the stigma, he could not secure any employment at all is hard to be believed. On the contrary, it may be a justification for the defendants to terminate his employment as his work was not satisfactory. 43. Keeping in mind all these aspects, we are of the view that the plaintiff is entitled to damages because of wrongful termination, but it is to the extent of the amount so far paid and drawn by him. The plaintiff has received a sum of Rs. 3,82,604/- by way of an interim order passed in the first round. At the time of entertaining this appeal by granting an interim order of stay, this Court directed the defendants to deposit a sum of Rs. 10 lakhs with a further direction that the said amount should be kept in fixed deposit earning interest.
3,82,604/- by way of an interim order passed in the first round. At the time of entertaining this appeal by granting an interim order of stay, this Court directed the defendants to deposit a sum of Rs. 10 lakhs with a further direction that the said amount should be kept in fixed deposit earning interest. Accordingly, the defendant deposited the said amount in Court which was kept in fixed deposit. By an interim order dated 19.9.2011 a sum of Rs. 6 lakhs was directed to be paid to the plaintiff and accordingly, it was paid. Subsequently by further interim order dated 5.7.2013 the balance amount of Rs. 4 lakhs in deposit was also ordered to be paid to the plaintiff. Thus in all a sum of Rs. 13,82,603/- has been paid by way of compensation. In the facts and circumstances of the case, we do not find any justification to direct the plaintiff to redeposit the amount. On the contrary, in our view, interest of justice would be met by holding that the plaintiff would be entitled to the aforesaid amount as damages payable to him for wrongful termination of his employment. In addition to the said amount, he would be entitled to all the statutory benefit such as Provident Fund and Gratuity. The defendant shall co-operate with the plaintiff in securing release of the said amount at the earliest and all payments made after termination till today in addition to what is referred to above, also belongs to the plaintiff and not refundable. Accordingly, we pass the following: ORDER (i) Appeal is partly allowed to the extent indicated above; (ii) Cross-Objection is dismissed. Parties to bear their own costs. Appeal partly allowed.