Calcutta High Court
Subhojit Dutta vs Union Of India & Ors on 23 December, 2008
IN THE HIGH COURT AT CALCUTTA
CONSTITUTIONAL WRIT JURISDICTION
ORIGINAL SIDE
Present:
The Hon'ble Justice S.P. Talukdar
W.P. No. 936 of 2008
Subhojit Dutta
Vs.
Union of India & Ors.
For the Petitioner : Mr. Kashi Kanta Moitra, Sr. Adv.,
Mr. R. N. Majumdar,
Mr. Sandip Ghosal,
Mr. Susanta Pal,
Ms. Rupa Mukherjee,
Ms. Reshmi Mukherjee.
For the Respondent No. 2 : Mr. Partha Sarathi Sengupta,
Mr. Soumya Majumdar, Mr. P. K. Mishra.
For the Respondent Nos. 1 & 4 : Mr. Ashutosh Law, Sr. Adv.,
Mr. P. Mukherjee,
Mrs. A. Banerjee.
Judgment on : 23.12.2008.
S.P. Talukdar, J.: The petitioner, Subhojit Dutta, by filing the instant
application under Article 226 of the Constitution has sought for withdrawal, recalling and/or cancellation of the impugned letter dated 29th February, 2008, being Annexure-'P-7' to the writ application Grievances of the petitioner, as ventilated in the instant application, may briefly be stated as follows:-
After getting promotion at various levels, he was finally posted as General Manager (North) w.e.f. 1st April, 2004. The Secretary of the Public Enterprises Selection Board (PSEB) by notification No. 7/68/2004-PESB dated 14th September, 2004 apprised the Bridge and Roof Co. (I) Ltd. that the Public Enterprises Selection Board was on the look out for a suitable candidate for the post of Director (Project Management) of Bridge and Roof Co. (I) Ltd. Request was made that names of the willing eligible candidates seniority-
wise might be forwarded to the office of Public Enterprises Selection Board within 30 days from the issue of that letter. In pursuance of the said notification, the petitioner applied for the said post in the prescribed proforma and it was duly forwarded by respondent No. 2 company to its holding company, the Bharat Yantra Nigam Ltd. which in turn forwarded the same to the office of Public Enterprises Selection Board. The petitioner duly appeared on 22nd December, 2004 for selection to the said post.
By letter dated 17th June, 2005, the Company Secretary of the respondent No. 2 company was informed that the President of India had sanctioned appointment of the petitioner as Director (Project Management) of the respondent No. 2 company w.e.f. 12th April, 2005. The terms and conditions of such service included the period of such appointment. It was mentioned that such period of appointment will be till the date of his superannuation or until further orders, whichever is earlier and in accordance with the provisions of the Companies Act. It was further mentioned that the appointment may, however, be terminated even during this period by either side on three months notice or on payment of three months salary in lieu thereof. At the time of such appointment, the age of retirement of the employees in respect of Board and Below Board Level employees of the respondent No. 2 company was 58 years. Government of India, Ministry of Heavy Industries and Public Enterprises, Department of Heavy Industry by a Memo No. 7(12)/2007-PE dated 30th July, 2007 conveyed the Managing Director of Bridge & Roof Company (I) Ltd., Kolkata about the approval of the competent authority to enhancement of retirement age from 58 to 60 years in respect of Board and Below Board Level employees of Bridge & Roof Company (I) Ltd. (B & R) with immediate effect. Thus, in terms of clause (i) of the letter dated 17th June, 2005, the appointment of the petitioner for the post of Director (Project Management) would be till the date of his superannuation i.e. on attaining the age of 60 years or until further order whichever is earlier and in accordance with the provisions of the Companies Act.
Under Secretary (Vig) Government of India, Ministry of Heavy Industries and Public Enterprises, Department of Heavy Industry by letter dated 7th February, 2008 informed the Chairman - Managing Director of Bharat Yantra Nigam Limited that the ACR of the petitioner for the year 2006-2007 had not yet been received and since the same was required to be sent to Department of Personnel & Training in connection with extension of tenure of the petitioner, Bharat Yantra Nigam Limited was requested to send the ACR within three days of the date of the said letter. Copy of the letter was endorsed to the petitioner. This was incomprehensible when the terms and conditions of appointment of the petitioner specifically mentioned that such appointment would till the date of his superannuation and so there could be no question of any extension of tenure.
To his utter surprise, by a letter dated 29th February, 2008 under the heading "completion of tenure of Shri Subhojit Dutta, Director (Project Management), Bridge & Roof Co. (India) Ltd. (B & R), Kolkata" the Government of India, Ministry of Heavy Industries & Public Enterprises, Department of Heavy Industry informed the Managing Director of the respondent No. 2 company that since at the time of appointment of the petitioner as the Director (Project Management) the superannuation age in the respondent No. 2 company was 58 years and taking into consideration that the age of superannuation of the petitioner is 58 years only i.e. up to 29th February, 2008, this period had not been extended by the competent authority and, thus, the petitioner would cease to be Director (Project Management) of the respondent No. 2 company beyond 29th February, 2008.
By a circular dated 4th March, 2008, the Company Secretary of the respondent No. 2 company informed all concerned that in terms of letter dated 29th February, 2008, being Annexure-'P-7' to the writ application, the petitioner had ceased to be Director (Project Management) of the respondent No. 2 company beyond 29th February, 2008. The petitioner was humiliated by the respondent No. 2 company by way of a letter dated 13th March, 2008 whereby the respondent No. 2 company communicated to the petitioner about the purported policy for retention of lien on appointment below the Board level in the case of individuals selected and appointed to Board level positions in the public sector. The petitioner was thereby informed that he was permitted by the respondent No. 2 company to keep lien and accordingly was placed in the pay scale of E-7 (Rs. 18500 - 450 - 23900) w.e.f. 1st March, 2008.
By a circular dated 20th March, 2008, the General Manager (HRD) of the respondent No. 2 company informed all concerned that the petitioner has been posted in grade (E-7) w.e.f. 1st March, 2008 and he is designated as Technical Adviser to MD of the respondent No. 2 company. Such termination of appointment of the petitioner to the post of Director (PM) smacks of arbitrariness and highhandedness and against the principle of Article 311(2) of the Constitution of India. It was violative of the principle of audi alteram partem. It was also in violation of Articles 14, 16 and 21 of the Constitution of India. Arbitrary action in terminating the appointment of the petitioner in the post of Director (Project Management) and reducing his rank by posting him as Technical Adviser to the Managing Director of the respondent No. 2 company is without any authority of law. This was done without even giving the petitioner any reasonable opportunity of hearing. Petitioner's position in the society as well as family has, thus, been lowered. The communication of such termination and subsequent letter dated 13th March, 2008 thereby lowering the rank of the petitioner are products of total non-application of mind. It was bad on the face of it inasmuch as three months notice and/or notice salary in lieu of said three months notice as required to be given in terms of clause (i) of the appointment letter dated 17th June, 2005, being Annexure-'P-2' hereof was not given before effecting such termination.
By letter dated 4th March, 2008, the petitioner requested the concerned authorities to let him know the reasons which prompted them to take such a punitive step by terminating his appointment to the post of Director (Project Management) and reducing his rank by posting him as the Technical Advisor to the Managing Director of the respondent No. 2 company being a below Board level post. The petitioner has not received any reply thereto. By letter dated 28th April, 2008, the petitioner called upon the respondents to restore him to the post of Director (Project Management), but there had been no reply to the same.
In the circumstances, the petitioner has approached this Court for redressal of his grievances.
Respondent No. 2 contested the case by filing Affidavit-in-Opposition wherein all the material allegations made by the writ petitioner had been challenged.
Respondent No. 2 stated that the petitioner was appointed in the company as an Officer vide appointment letter dated 23rd February, 1987. He was selected and promoted as General Manager (North) vide order dated 1st November, 2004 and he was promoted to the post w.e.f. 1st April, 2004 fitted in Grade E-7. The promotion benefit was, however, effected only from 1.10.2004. By an order dated 12th April, 2005, the Ministry approved the appointment of the writ petitioner as Director (Project Management) of the respondent No. 2 company. He was subsequently appointed as Director (Project Management) by the competent authority of Government of India of the respondent No. 2 company w.e.f. 12.4.2005 on the terms and conditions mentioned in the letter dated 17th June, 2005 issued by the Ministry of Heavy Industries and Public Enterprises to the company. At the time of his appointment to the post of Director, the age of superannuation was 58 years. Considering the petitioner's lien to the post of General Manager which he was holding at the time of his appointment as Director (Project Management) in terms of Department of Public Enterprise Guideline he was posted to the same post of General Manager with protecting his salary last drawn. As per personnel policies of the Directorate of Public Enterprises, the retention of lien to the substantive post below Board level is permissible for a period of five years. The petitioner was, thus, placed to the substantive post in which he had lien.
Appointment of Director in the respondent company is regulated by the contractual service condition and extension beyond 58 years is based on some fixed criteria and cannot be automatically done like other below Board level who are governed by permanent regular promotions.
Respondent Nos. 1 and 4 in the Affidavit-in-Opposition took virtually the same stand and stated that the petitioner does not have a legally enforceable right to continue his service by treating his age of superannuation to be 60 years since he had been appointed to the post of Director knowing fully well that the contractual employment as Director would come to a cessation on attaining the age of 58 years. Respondents further claimed that the petitioner did not even have the requisite actual experience of one year in the post of General Manager to become eligible to hold the post of Director (Project Management).
Dismissal of the writ application was, thus, prayed for.
It appears from the materials available on record that the petitioner was appointed as Director (Project Management) w.e.f. 12th April, 2005 of M/s. Bridge & Roof Company (I) Ltd. (B & R). The period of his appointment was till the date of his superannuation or until further order, whichever is earlier and in accordance with the provisions of the Companies Act. The terms and conditions as mentioned in the letter of appointment also referred to the fact that the appointment may be terminated even during this period by either side on three months notice or on payment of three months salary in lieu thereof.
Learned Counsel for the petitioner, deriving inspiration from the said terms and conditions as referred to, submitted that there could be no reason nor any justification for making the petitioner retire on his attaining the age of 58 years. This was in the context of the fact that the age of retirement was enhanced to 60 years and as such, the petitioner was very well entitled to continue in the said post till his attaining of 60 years. In fact, that is the crux of the controversy raised in the present writ application.
Assailing the order of termination, it was contended on behalf of the petitioner that where the termination is outside powers of a statutory body either because the statutory body has no power to terminate the employment or because the termination is effected in breach of a mandatory obligation imposed by law which prescribes that the termination shall be effected only in a particular manner and no other, it would be a nullity and the employee would be entitled to ignore it and ask for being treated as still in service. In this context, learned Counsel for the petitioner derived inspiration from a decision of the Apex Court in the case of Executive Committee of Vaish Degree College, Shamli & Ors. Vs. Lakshmi Narain & Ors., as reported in AIR 1976 SC 888.
While referring to the status and position as well as the nature of the post of the writ petitioner, it was submitted on his behalf that the legal position of a Government servant is more one of status than of contract. Referring to the decision of the Apex Court in the case of Roshan Lal Tandon Vs. Union of India & Anr. as reported in AIR 1967 Sc 1889, it was submitted that the hall-mark of status is the attachment to a legal relationship of rights and duties imposed by the public law and not by mere agreement by the parties.
It was emphatically mentioned on behalf of the writ petitioner that it is a well settled rule of administrative law that an executive authority must be rigorously held to the standards by which it professes its actions to be judged and it must scrupulously observe those standards on pain of invalidation of an act in violation of them. (Ref: -Ramana Dayaram Shetty Vs. The International Airport Authority of India & Ors., as reported in AIR 1979 SC 1628).
Reference was made to the observation of Mr. Justice Frankfurter in Vitarelli Vs. Seaton (1959) 359 US 535 where the learned Judge said :
"An executive agency must be rigorously held to the standards by which it professes its action to be judged......... Accordingly, if dismissal from employment is based on a defined procedure, even though generous beyond the requirements that bind such agency, that procedure must be scrupulously observed. .......... This judicially evolved rule of administrative law is now firmly established and, if I may add, rightly so. He that takes the procedural sword shall perish with the sword."
Attention of the Court was invited to the article of Mathew, J. "The Welfare State, Rule of Law and Natural Justice" in Democracy, Equality and Freedom which is:
"Substantial agreement in juristic thought that the great purpose of the rule of law notion is the protection of the individual against arbitrary exercise of power, wherever it is found."
No doubt, every action of the executive Government or any of its officers should be free from arbitrariness and it must be informed with reason. This is the very essence of the rule of law and its bare minimal requirement.
The Apex Court in the case of West Bengal State Electricity Board & Ors. Vs. Desh Bandhu Ghosh & Ors., as reported in AIR 1985 SC 722, observed that the time for banishing altogether the naked 'hire and fire' rule from employer-employee relationship is fast approaching. An authority cannot be conferred with such arbitrary, uncanalised and drastic power to enable the employer to dispense with an enquiry and to dismiss an employee, without assigning any reason.
On behalf of the respondent No. 2 it was submitted by Mr. Partha Sarathi Sengupta, as its learned Counsel, that the eligibility relating to age for the job of Director (Project Management) was indicated as 'at least 45 years but not more than 56 years on the date of occurrence of the vacancy'. He submitted that the persons above the age of 56 years, thus, could not apply for the said post. This was on the basis of the fact that retirement age at the relevant time was 58 years. To entertain the claim of the writ petitioner, according to Mr. Sengupta would, thus, amount to depriving other eligible candidates who could have very well approached had the retirement age been 60 years.
Referring to copy of the communication dated 17.6.2005, being Annexure-'P-2' at page 43, it was submitted by Mr. Sengupta that the same is prospective in nature. It was contended that what is natural justice to the petitioner would be unjust and unreasonable for others. According to him, automatic extension of the period of service of the petitioner to 60 years will result in discrimination. Mr. Sengupta then submitted that a contract essentially means meeting of minds and certainly, with regard to the conditions as specified in the relevant document. There cannot be shift from the same and subsequent change of policy decision cannot bind the parties to the contract. It was further submitted that the essential ingredients of a contract are required to be looked into and for that purpose, the terms and conditions as mentioned at the time of execution of such contract are binding. Since retirement age of employees at the time of execution of contract was 58 years, both parties must have acted on it. He also submitted that enforcement of a contract is possible by way of seeking damages.
It was submitted on behalf of the respondent No. 2 that a contract of employment for personal service could not be specifically enforced. Referring to the decision in the case of Jitendra Nath Biswas Vs. M/s. Empire of India & Ceylone Tea Co. & Anr., as reported in AIR 1990 SC 255, it was submitted that except the industrial law, under the law of contract and the civil law, an employee whose services are terminated could not seek the relief of reinstatement and back wages. At best he could seek relief of damages.
Reference was further made to the decision of the Apex Court in the case of Piara Singh & Ors. Vs. Natha Singh & Ors., as reported in AIR 1991 SC 1525. The Apex Court in the said case observed that a contract of employment cannot ordinarily be enforced by or against an employer. The remedy is to sue for damages. It is well settled that in absence of any statutory requirement, Courts do not ordinarily force en employer to recruit or retain in service an employee not required. There are, of course, certain exceptions to this rule, such as in the case of a public servant dismissed from service in contravention of Article 311 of the Constitution; reinstatement of a dismissed worker under the Industrial Law; a statutory body acting in breach of statutory obligations, and the like.
In this context, Mr. Sengupta also referred to Section 14 of the Specific Relief Act while dealing with the appropriate forum for redressal of the grievances.
Mr. Sengupta, deriving inspiration from the decision of the Apex Court in the case of State Bank of India & Ors. Vs. S. N. Goyal, as reported in 2008 AIR SCW 4355, submitted that when an employee of a statutory body whose service is terminated, pleads that such termination is in violation of statutory rules governing his employment, an action for declaration that the termination is invalid and that he is deemed to continue in service is maintainable and will not be barred by Section 14 of the Specific Relief Act.
Learned Counsel for the respondent/Union of India virtually echoed the submission made on behalf of the respondent No. 2.
It emerges from the materials available on record that in response to the communication dated 14th September, 2004, the writ petitioner presented himself as a candidate and as it appears from the Annexure-'P-2' at page 43 of the writ application, he was appointed as Director (Project Management) of M/s. Bridge & Roof Company (India) Limited (B&R) w.e.f. 12.04.2005. It was indicated that 'the period of his appointment will be till the date of his superannuation or until further orders, whichever is earlier and in accordance with the provisions of the Companies Act. The appointment may, however, be terminated even during this period by either side on three months notice or on payment of three months salary in lieu thereof.' Annexure-'P-3' at page 49 is a communication dated 30th July, 2007, which relates to enhancement in the retirement age from 58 to 60 years in respect of profit making PSEs which have been earning profit for the last three years. The circular dated 30th July, 2007, being Anneuxre-'P-4' is a communication of the approval of the competent authority for implementation of the roll forward of retirement age from 58 to 60 years in respect of Board & Below Board level employees of Bridge & Roof Co. (I) Ltd. By letter dated 7th February, 2008, the under Secretary (Vig.), Ministry of Heavy Industry & Public Enterprises, Department of Heavy Industry, requested the CMD of Bharat Yantra Nigam Limited to send the CR, which was required in connection with extension of his tenure of the petitioner.
Referring to the policy and procedures of the Public Enterprises Selection Board, it was submitted that so far the tenure of appointment at Board level is concerned, it would be an appointment for a period of five years or till the age of superannuation, whichever is earlier on contract basis with a provision that the Government will have the option to terminate the services with three months notice.
By letter dated 29.2.2008, being Anexure-'P-7' at page 59 of the writ application, the Managing Director of Bridge & Roof Co. (I) Ltd. was informed that at the time of appointment of the writ petitioner, the superannuation age was 58 years. He was appointed as Director (Project Management) taking into consideration the age of his superannuation as 58 years only i.e. up to 29.2.2008 and such period was not extended by the competent authority.
In course of submission, plea was raised on behalf of the respondent that there had been suppression of material fact even at the time of furnishing particulars for appointment in the post of Director (PM) and that was in relation to his experience. This point does not deserve to be entertained since there is no reflection of such a ground in the order of termination. Moreover, raising of that plea would certainly demand initiation of an enquiry, as it is stigmatic.
In the case of Central Inland Water Transport Corporation Ltd. & Anr. Vs. Brojo Nath Ganguly & Anr., as reported in AIR 1986 SC 1571, it was observed that Courts will not enforce and will, when called upon to do so, strike down an unfair and unreasonable contract, or an unfair and unreasonable clause in a contract, entered into between parties who are not equal in bargaining power.
Reference was made to the decision of the Apex Court in the case of Mohinder Singh Gill & Anr. Vs. The Chief Election Commissioner, New Delhi & Ors., as reported in AIR 1978 SC 851, while submitting that when a statutory functionary makes an order based on certain grounds, its validity must be judged by the reasons so mentioned and cannot be supplemented by fresh reasons in the shape of affidavit or otherwise. The Apex Court expressed concern that otherwise, an order bad in the beginning may, by the time it comes to Court on account of a challenge, get validated by additional grounds later brought out.
Thus, the submission relating to alleged suppression of material fact is of little significance.
It was contended that mala fide exercise of power and arbitrariness are different lethal radiations emanating from the same vice: in fact the latter comprehends the former. Both are inhibited by Articles 14 and 16. (Ref: E.P. Royappa Vs. State of Tamil Nadu & Anr., as reported in AIR 1974 SC 555).
Deriving support from the decision in the case of Nehru Yuva Kendra Sangathan Vs. Mehbub Alal Laskar, as reported in 2008-II-LLJ-868 (SC), it was submitted on behalf of the petitioner that authority concerned was not justified in issuing such order thereby bringing the service of the writ petitioner as Director (PM) to an end without affording him an opportunity of hearing.
Having regard to the nature of the controversy raised and the relief sought for and the status of the respondent authority, I do not find any reason whatsoever as to why this Court in exercise of its writ jurisdiction should not entertain the application. The doors of this Court cannot be closed on the plea that the petitioner, in effect, has sought for enforcement of a contract of service.
This would be an over simplification of the issues raised in the writ application. The terms of service never mentioned the age of retirement. It only speaks about 'superannuation'. It is true that at the time of extension of the contract, the age of retirement was 58 years but there can be no reason as to why it was not extended to 60 years, as has been done in respect of all kinds of employees. The authority cannot be permitted to take the plea that the intention of the parties was that the service would be till 58 years when it only refers to 'superannuation'. Such a plea would be unreasonable and unjust and a clear departure from the spirit of the letter of appointment. This Court cannot appreciate such an attempt to read something more than what meets the eyes.
As discussed earlier, there is very little force in the submission that the present application is barred by Section 14 of the Specific Relief Act.
Considering all these aspects, I find it difficult, if not impossible, to brush aside the grievances as ventilated on behalf of the writ petitioner. It was not justified on behalf of the respondent authority to ignore the subsequent enhancement of the age of retirement to 60 years. The impugned letter dated 29th February, 2008, thus, cannot stand a moment's judicial scrutiny and the same is accordingly quashed.
Consequently, any action taken by the respondent authority in pursuance thereto stands cancelled. This Court by order dated 19th June, 2008 directed that 'any action regarding filling up the post under reference will be subject to the result of the writ application'. In view of the said interim order, the respondent authority is hereby directed to take appropriate steps for compliance with this Court's order whereby the order of termination has been quashed. This must be done within a period of four weeks from the date of communication of the order. It may be mentioned that at the time of hearing of the application, it was not submitted by either of the parties that the post of Director (Project Management) had since been filled up by appointing anyone in place of the writ petitioner.
There is no order as to costs.
Xerox certified copy of the judgment be supplied to the parties, if applied for, as expeditiously as possible.
(S.P. Talukdar, J.) Later:
Immediately after passing of the aforesaid judgment and order, Mr. Mukherjee, as learned Counsel for the respondent authority, has prayed for stay of operation of the same.
Mr. Majumdar, learned Counsel on behalf of the writ petitioner, has raised objection thereto.
After due consideration of all relevant aspects, prayer for stay is refused. Xerox certified copy of the judgment be supplied to the parties, if applied for, as expeditiously as possible.
(S.P. Talukdar, J.)