Calcutta High Court (Appellete Side)
Beer Bikram Kumar Singh vs Datex-Ohmeda (India) Pvt. Ltd on 21 March, 2014
Author: Arindam Sinha
Bench: Jyotirmay Bhattacharya, Arindam Sinha
IN THE HIGH COURT AT CALCUTTA
Civil Appellate Jurisdiction
Appellate Side
Present :
The Hon'ble Justice Jyotirmay Bhattacharya
And
The Hon'ble Justice Arindam Sinha
F.A. No. 44 of 2008
Beer Bikram Kumar Singh
Vs.
Datex-Ohmeda (India) Pvt. Ltd
For the Appellant : Mr. S.P. Roychoudhury, Adv.
: Mr. Ganesh Srivastav, Adv.
: Mr. Sukanta Das, Adv.
For the Respondent : Mr. Soumya Majumdar, Adv.
: Mr. Sourav Bhagat, Adv.
: Mr. Pares Chandra Nath, Adv.
Heard on : 28.11.13, 29.11.13, 24.01.14, 31.01.14,
21.02.14 & 28.02.14.
Judgment on : 21st March, 2014
Arindam Sinha, J.
The plaintiff had filed his suit for declaration, injunction and damages for wrongful dismissal from employment. Such suit was decreed in part on contest with costs. The plaintiff got a declaration that the censure notice and order of termination made by the defendant against him was wrongful in nature and a decree for damages of Rs.86,400/-. Being aggrieved and dissatisfied with the rejection of the rest of his claim for damages, the plaintiff preferred this appeal.
The only question that arises in this appeal relates to the quantum of damages the plaintiff is entitled. This is because the declaration made by the Ld. Court below stands accepted by the defendant.
Mr. S. P. Roychoudhury Ld. Senior Advocate appearing on behalf of the plaintiff submitted that the service of the plaintiff was wrongfully terminated on 20th February, 2003 and the plaintiff filed the suit on 9th June, 2003. The plaintiff in cross-examination on 5th April, 2005 had deposed that he was unemployed and not trying to get further job with his qualification. It was submitted on behalf of the plaintiff that the wrongful termination was a stigma attached to the plaintiff by reason of which knowing he would not get employment elsewhere, he had been compelled to file the suit in seeking to have, inter alia, the stigma removed. There was no evidence on record to the effect that the plaintiff obtained employment elsewhere or had obtained some income following wrongful termination of his service by the defendant. In the circumstances, the plaintiff was entitled to his claim on damages as made in the suit.
Mr. Roychoudhury, took us through the pleadings in the plaint, paragraph 49 thereof and the written statement also paragraph 49 in dealing with the particulars of the plaintiff's claim for damages. He submitted that the bare allegation made by the defendant that there was no justification or basis for the amount of damages of Rs.1,07,68,075/-claimed was at best an evasive denial. He relied on Order 8 Rule 4 of the Code of Civil Procedure to submit that the claim made by the plaintiff on account of damages by particulars given in paragraph 49 of the plaint thus stood admitted. According to Mr. Roychoudhury the plaintiff, therefore, had proved actual loss suffered. To substantiate his submissions, Mr. Roychoudhury relied upon the decisions reported in (2004) 1 WBLR (Cal) 799 (WBSEB Vs. Dilip Kumar Roy and Ors.), (2003) 5 Supreme Court Cases 705 (ONGC Ltd. Vs. Saw Pipes Ltd.), AIR 2000 Supreme Court 2003 (Ghaziabad Development Authority Vs. Union of India) and AIR 1985 Delhi 45 (Andard Mount (London) Ltd. Vs. Curewel (India) Ltd. New Delhi).
Mr. Roychoudhury relied on the decision of the Division Bench of this Court in the case of WBSEB for the finding in paragraph 24 therein that the service incident of a private employer or employee is governed by the law of contract. Relying on the decision reported in the case of ONGC he submitted that thereby the Hon'ble Supreme Court had widened the interpretation and effect of Sections 73 and 74 of the Contract Act, 1872. Relying on paragraph 68 of the said judgment he submitted the law thus declared was that in every case of breach of contract, the person aggrieved by the breach was not required to prove actual loss or damages suffered by him before he can claim a decree. The court is competent to award reasonable compensation in case of breach even if no actual damage is proved to have been suffered in consequence of the breach of a contract. He laid great emphasis on the declaration made in that paragraph of this judgment where the Hon'ble Supreme Court had laid down that in some contracts, it would be impossible for the court to assess the compensation arising from breach and if the compensation contemplated is not by way of penalty or unreasonable, the court can award the same if it is genuine pre- estimate by the parties as the measure of reasonable compensation. He submitted that the particulars given in paragraph 49 of the plaint, as stood admitted by the defendant, was a genuine pre-estimate by the parties and ought to have been relied upon as the measure of reasonable compensation by the Ld. Court below.
Mr. Roychoudhury then went on to submit by relying on the case of Gaziabad Development Authority, the Hon'ble Supreme Court had held that broadly the principle underlining the assessment of damages is to put the aggrieved party monetarily in the same position as far as possible in which it would have been if the contract would have been performed. Following the rule as to remoteness of damages, such loss may be compensated as the parties could have contemplated at the time of entering into the contract. According to Mr. Roychoudhury the parties knew that the plaintiff had obtained employment on terms which were to be effective for the period of his employment till retirement. A breach committed by the defendant would, therefore, require it to pay damages by compensating the plaintiff monetarily to put him in the same position of having continued to serve till his retirement and accordingly such compensation had been claimed by the plaintiff.
Lastly, Mr. Roychoudhury relied upon the case of Andard Mount (London) Ltd. in particular paragraph 77 thereof where the Ld. Single Judge of the High Court, Delhi had quoted from the decision reported in AIR 1923 Calcutta 49 (Thomas Kingsley Vs. Secretary of State for India) as reproduced herein.
"In cases admitting of proof of such damages the amount must be established with reasonable certainty. But this does not mean that absolute certainty is required nor in all cases is there a necessary for direct evidence as to the amount. Damages are not uncertain for the reason that the loss sustained is incapable of proof with the certainty of mathematical demonstration or is to some extent is necessary and loss or damage must be so far removed from speculation or doubt as to create in the minds of intelligent and reasonable men the belief that it was most likely to follow from the breach of the contract and was a probable and direct result thereof."
Mr. Soumya Majumdar, Ld. Advocate appearing on behalf of the defendant confined his submissions to the measure of damages in the ordinary law of master and servant. He submitted that assessment of damages was to be made by reference to the amount earned in the service wrongfully terminated and the time likely to elapse before the servant obtained another post for which he is fitted. According to him, 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. The principle that the plaintiff must be placed, in the same situation as if the contract had been performed was qualified by a second principle which imposed on the plaintiff the duty of taking all reasonable steps to mitigate the loss consequent on the breach and debarred him from claiming any part of the damage which was due to his negligence to take such steps. In making the submissions noted above Mr. Majumdar relied upon the following decisions:-
i) AIR 1958 Supreme Court 12 (S.S. Shetty Vs. Bharat Nidhi, Ltd.);
ii) AIR 1962 Supreme Court 366 (Murlidhar Chiranjilal Vs. Harishchandra Dwarkadas and Anr.); and
iii) (1975) 1 LLJ 23 Cal (Balaram Chatterjee Vs. Hindustan Steel Ltd.).
Mr. Majumdar continued on the question of assessment of damages by elaborating on the principle of mitigation of damages. He relied on the decisions reported in AIR 1981 Supreme Court 162 (M. Lachia Setty and Sons Ltd. Vs Coffee Board, Bangalore); (2009) 3 Supreme Court Cases 124 (Novartis India Ltd. Vs. State of West Bengal and Ors.); and 187 (2012) Delhi Law Times 25 (Shri Satya Narain Garg Vs. DCM Ltd. and Ors.). He submitted that the principle of mitigation of loss is a concept to be borne in mind while awarding damages. 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 such loss which he ought reasonably to have avoided. He submitted that the self-serving statement of the plaintiff that he had not tried to get further job with his qualifications cannot be held as discharge of onus of proof of damages. So it is the submission of Mr. Majumdar that in a situation where the plaintiff had not discharged his onus to show mitigation of damages, the award of damages made by the Ld. Trial Court below was justified. The decree on damages equivalent to six months pay and other benefits which would have been earned by the plaintiff being basic salary, conveyance allowance and supplementary allowance was just and proper.
In the absence of any evidence regarding notice period, Mr. Majumdar relied on the following decisions to support the award of damages decreed.
i) AIR 1959 Calcutta 536 (Satyendra Kumar Dutta Vs. District Board of 24 Parganas); and
ii) AIR 1964 Madras 183 (The Tanjor Permanent Bank Ltd. Vs. G.N Muniswami).
He submitted that different courts had held that three months notice period was reasonable. A servant complaining of wrongful dismissal could not claim the entire amount of anticipated salary covering the whole period for which he expected to continue in service so as to utilize such amount for other investment and thus to convert the very injury complained of into a blessing in disguise. Common law which recognized his right to recover damages for wrongful dismissal imposed a corresponding duty on him to do all that was possible to mitigate such damages.
The plaintiff had claimed damages under several heads as per particulars given in paragraph 49 of the plaint. Those particulars not having been disputed by the defendant except to say that there was no justification or basis for the same gives us the impression that the denial was directed at the period claimed and not the particulars themselves. We find from the evidence-in-chief of the plaintiff that he had stated that his dismissal from service was widely publicised in one of the leading newspapers of the city being the Ananda Bazar Patrika published on 18th April, 2003. In such a situation and considering the several judgments cited before us, we find that there is no evidence on record to show that the plaintiff in the time following his wrongful dismissal from service had either obtained employment or some income. The defendant could not show otherwise. What remained to be seen was what were the circumstances which prevented him from seeking to obtain employment elsewhere with the qualification he has. The part of the decree which stands accepted by the defendant is the declaration that the censure notice and order of termination made by the defendant were both wrongful in nature. The Ld. Trial Court did find that thereby stigma had been cast upon the plaintiff.
Once the declaration was made that, inter alia, the termination of service was wrongful by the judgment and decree dated 21st June, 2007, the stigma stood removed. Till before that time we accept that such stigma remained attached to the plaintiff giving rise to circumstances which prevented him from obtaining employment elsewhere. It follows that damages must be assessed as can be awarded to the plaintiff following the wrongful termination of his service on 20th February, 2003 till the date of the impugned judgment and decree being 21st June, 2007. In assessing such damages we can do the same from the pre-estimate by particulars given in paragraph 49 of the plaint but only those which have been duly proved and appear to us to be reasonable. Those particulars that are unacceptable to us is because they relate to reimbursibles and the plaintiff not having worked did not incur any reimbursible expenses.
We find that the following particulars given in paragraph 49 of the plaint have been duly proved by the plaintiff and are reasonable for the purpose of assessment of damages payable for the aforesaid period of four years and four months ( i.e. 52 months).
i) Basic salary @ Rs.9,900/- per month = Rs.5,14,800/-
ii) House rent @ Rs.35% of basic salary per month = 1,80,180/-
iii) Supplementary allowance @ Rs.500/- per month = 26,000/-
iv) Provident Fund employers contribution @ Rs.12% of basic salary per month Rs.61,776/- Total =7,82,856/-
That brings us to the question of what would be the reasonable notice period for the plaintiff to have obtained employment after the stigma was removed? We find from the decisions referred to above on the question that three months was consistently held to be reasonable notice period in the absence of a term of contract to that effect. In this case though it was submitted that there was a term of one month's notice for termination, no such evidence is available on record and in the circumstances we feel that three months severance pay calculated in the same manner would be just and reasonable. In the premises we award aggregate damages to the plaintiff of the sum of Rs.8,28,020/-. The impugned judgment and decree is modified accordingly in allowing the appeal in part. The aggregate damages decreed is to be paid within one month from the date of the decree failing which the decretal amount will carry interest @ 8% per annum till the date of payment.
There will be no order as to costs.
(Arindam Sinha, J.) Jyotirmay Bhattacharya, J.
I agree (Jyotirmay Bhattacharya, J.) Later Prayer for stay made by the appellant is considered and refused.
(Arindam Sinha, J.) (Jyotirmay Bhattacharya, J.)