Delhi District Court
Sh. Rajender Kumar Singhal vs M/S. Muthoot Finance Limited on 28 September, 2022
IN THE COURT OF MS. RAVINDER BEDI,
ADDL. DISTRICT JUDGE-02 (SHAHDARA),
KARKARDOOMA COURTS, DELHI.
C.S. No. 131/2016
CNR No.DLSH010003602015
In the matter of :-
Sh. Rajender Kumar Singhal,
S/o Sh. Shiv Shankar Dayal,
R/o H-25/1, Naveen Shahdara,
Delhi-110032.
..........Plaintiff
VERSUS
M/s. Muthoot Finance Limited,
Corporate Office (North) : Muthoot Towers,
Alaknanda, New delhi-110019.
Through its Chairman.
.......Defendant
Date of institution of suit : 15.12.2015
Date of final arguments : 22.08.2022
Date of judgment : 28.09.2022
Appearance :
Plaintiff represented through Counsel Mr. Abhishek Kumar.
Defendant represented through Counsel Mr. S.S.Sobti.
Digitally signed
by RAVINDER
CS 131/2016 BEDI
Sh. Rajender Kumar Singhal v. M/s. Muthoot Finance Limited RAVINDER Page No.1 of 14
Date:
BEDI 2022.10.01
18:01:17
+0530
JUDGMENT
1. Plaintiff by way of present suit claims recovery of Rs.3,43,325/- (Rupees Three Lakhs Forty Three Thousand Three Hundred Twenty Five) along with declaration and mandatory injunction against Defendant. The reliefs prayed by plaintiff are reproduced as :-
(a) a decree in favour of the plaintiff and against the defendant for a sum of Rs.3,43,325/- (three lacs Forty Three Thousand Three Hundred Twenty Five) with interest @ Rs.24/% p.a. from the date of filing of the suit till realization.
(b) a decree for declaration in favour of the plaintiff and against the defendant declaring the Termination dated 12.10.2015 as null and void with consequential relief to cancel and set aside the termination letter.
(c) a decree of mandatory injunction in favour of the plaintiff and against defendant directing them to return/handover the original Intermediate Certificate Sl. No. 22206 and Reg. No./Roll No. 12856, issued by Board of School Education, U.P. Dated 26.06.1969 to the plaintiff.
2. To put succinctly as mentioned in the plaint, Plaintiff was appointed as Branch Manager by Defendant at its Branch Office at Chanderlok, Shahdara vide an Appointment Letter dated 12.08.2011 on monthly salary of Rs.22,000/-. Plaintiff performed his duties with utmost satisfaction without Digitally CS 131/2016 signed by Sh. Rajender Kumar Singhal v. M/s. Muthoot Finance Limited Page No.2 of 14 RAVINDER RAVINDER BEDI BEDI Date:
2022.10.01 18:01:23 +0530 any complaint and his service was extended from time to time vide Extension Letter Ex. PW/4. Plaintiff was performing his duties on 12.10.2015 in the office as usual, when he was telephonically told by Assistant, Regional Manager that he was called by HR Department at Corporate Office of the Defendant. Plaintiff met Deputy General Manager (HR), Smt. Ruchi Dhawan Sharma, who handed him over a Termination Letter dated 12.10.2015 and stated that Plaintiff's services were no longer required and he was terminated with immediate effect. The termination of the plaintiff without any notice/show cause notice or issuance of any chargesheet was illegal, unjustified and against the principles of natural justice. Plaintiff visited to the Branch office of defendant on 15.10.2015 and requested to recall the notice dated 12.10.2015, but was asked to submit his statement of account for the remaining dues. Plaintiff submitted his statement of dues including his service benefits as mentioned para no. 11 of the plaint which were to the tune of Rs.3,43,325/-. The defendant however refused to pay the said amount. The act of the defendant in terminating the Plaintiff was clearly illegal for which Plaintiff issued a Legal Notice dated 17.10.2015 challenging the illegal termination and also issued a final reminder on 07.11.2015 but the defendant did not respond; Hence, the present suit.
3. The Defendant contested the suit and filed its written statement wherein it took certain preliminary objections and contended that Plaintiff was placed as a Manager for a period of one year with the Defendant Company w.e.f. 23.08.2011 and the same was extendable at the exclusive discretion of Digitally signed CS 131/2016 Sh. Rajender Kumar Singhal v. M/s. Muthoot Finance Limited by RAVINDER Page No.3 of 14 RAVINDER BEDI BEDI Date:
2022.10.01 18:01:28 +0530 defendant company for further period of one year at a time or till Plaintiff attained the age of 65 years and upon his performance being found satisfactory. It is contended that the terms and conditions were governed as per the Letter of Placement dated 12.08.2011. The service of the plaintiff was extended from time to time. A Letter of Placement dated 01.04.2014 was issued to the plaintiff as per which plaintiff's services were extended for another period of one year vide written communication dated 16.03.2015 and thus his services stood extended. It is stated that gross acts of indiscipline and misconduct were reported against the plaintiff viz. sleeping in his branch office during office hours, violation of laid down guidelines regarding operation of strong room containing valuation security etc. and same were reported against the Plaintiff. Defendant as per the Contractual rights vested in it terminated the services of plaintiff vide letter dated 12.10.2015. It was contended that as per Clause 14 of letter of placement dated 01.04.2014, Defendant was fully entitled to terminate the placement of plaintiff 'forthwith' since Plaintiff was found indulging in the acts of indiscipline and / or misconduct. Rest of the averments in the Plaint were denied as false. It is contended that only a sum of Rs.27,325/- was due and payable to plaintiff, which was offered to him, however, he avoided to collect the same. It is contended that plaintiff was not entitled to any other benefit/emoluments or the amounts claimed by him.
Digitally signed by RAVINDER RAVINDER BEDI CS 131/2016 Sh. Rajender Kumar Singhal v. M/s. Muthoot Finance Limited BEDI Date: Page No.4 of 14 2022.10.01 18:01:33 +0530
4. In replication, the Plaintiff reaffirmed and reiterated its averments set out in the plaint refuting the challenge to the suit by Defendant in Written Statement.
5. On the pleadings of parties, following issues were settled by Ld. Predecessor as under :
1. Whether services of plaintiff were illegally terminated by defendant vide its letter dated 12/10/2015 ? (OPP)
2. Whether Plaintiff is entitled for relief of declaration declaring letter dated 12/10/2015 as null and void ? (OPP)
3. Whether plaintiff is entitled to recover Rs.3,43,325/-
as prayed for ? (OPP)
4. Whether Plaintiff is entitled for interest, if so at what rate and for what period ?
5. Relief.
6. The matter was listed for evidence of Plaintiff. Plaintiff examined himself as PW-1 and tendered his affidavit as Ex.PW1/A. He has relied upon documents Ex.PW1/1 to Ex.PW1/19, i.e. voter ID card as Ex.PW1/1(OSR); Letter of Placement dated 12.08.2011 as Ex.PW1/2(OSR); Letter of Termination dated 12.10.2015 as Ex.PW1/3(OSR); Letter of Extension of Service dated 16.03.2015 as Ex.PW1/4(OSR); Legal Notice dated 17.10.2015 CS 131/2016 Digitally signed Sh. Rajender Kumar Singhal v. M/s. Muthoot Finance Limited by RAVINDER Page No.5 of 14 RAVINDER BEDI BEDI Date:
2022.10.01 18:01:37 +0530 as Ex.PW1/5; six postal receipts as Ex.PW1/6 to Ex.PW1/11 (OSR); tracking reports as Ex.PW1/12 to Ex.PW1/16; copy of Legal Notice dated 07.11.2015 as Ex.PW1/17 and postal receipts as Ex.PW1/18 and Ex.PW1/19 (OSR). He has been cross-examined at length by Ld. Counsel for Defendant and his evidence was closed by separate statement on 03.07.2017 and thereafter matter was posted for Defendants' evidence.
7. Defendant company examined its authorized representative, Sh. L.D.Sharma as DW-1, who has tendered his affidavit as Ex.DW-1/A. He has relied upon the documents Ex.DW1/1 to Ex.DW1/17 and Ex.PW1/D1 to Ex.PW1/D6 i.e. board resolution dated 22.09.2002 as Ex.DW1/1(OSR); POA dated 09.01.2015 as Ex.DW1/2(OSR); POA dated 09.01.2017 as Ex.DW1/3(OSR); Incorporation Certificate as Ex.DW1/4(OSR); office copy of communications dated 02.09.2014, 27.12.2014 and 21.08.2014 as Ex.DW1/5 to Ex.DW1/7 respectively; copy of email dated 21.08.2014 as Ex.DW1/8; photographs of plaintiff as Ex.DW1/9, deexhibited as Mark-A to Mark-D; Compact Disc containing said photographs as Ex.DW1/10; office copy of CCTV surveillance audit report dated 20.08.2014 as Ex.DW1/11; copy of email dated 20.08.2014 as Ex.DW1/12; certificate under Section 65-B of Indian Evidence Act in support of documents as Ex.DW1/13; office copy of reply dated 24.12.2015 as Ex.DW1/4; original postal receipts as Ex.DW1/15(colly); tracking reports as Ex.DW1/16(colly); full and final settlement as Ex.DW1/17; letter of placement dated 12.08.2011 as Ex.PW1/D1; documents pertaining list of duties and responsibilities of Branch Digitally signed CS 131/2016 Sh. Rajender Kumar Singhal v. M/s. Muthoot Finance Limited by RAVINDER Page No.6 of 14 BEDI RAVINDER Date:
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Manager / Assistant Branch Manager / Branch Incharge dated 23.08.2011 and 24.02.2010 as Ex.PW1/D2 and Ex.PW1/D3; honor code as Ex.PW1/D4, letter of placement dated 01.04.2014 as Ex.PW1/D5 and letter of termination dated 12.10.2015 as Ex.PW1/D6. He has been cross-examined at length by Ld. Counsel for Plaintiff. The evidence of Defendant was closed by separate statement on 22.12.2021 and the matter was listed for hearing final arguments.
8. I have heard Ld. Counsel for the parties, perused the entire record meticulously in the light of relevant statutory law as well as the legal issue raised by Defendant to the maintainability of suit.
ISSUES NO.1&2
1. Whether services of plaintiff were illegally terminated by defendant vide its letter dated 12/10/2015 ? (OPP)
2. Whether Plaintiff is entitled for relief of declaration declaring letter dated 12/10/2015 as null and void ? (OPP)
9. Issues no. 1 and 2 being interconnected and intertwined, are taken up together. The onus to prove them was upon Plaintiff. Ld. Counsel for the Plaintiff submits that the Plaintiff has been able to prove his case and the termination of the services of the Plaintiff was on illegal grounds for which no show cause notice or any inquiry was initiated by Defendant Company, which Digitally signed by RAVINDER CS 131/2016 BEDI Sh. Rajender Kumar Singhal v. M/s. Muthoot Finance Limited RAVINDER Page No.7 of 14 Date:
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terminated his services without assigning any reason. He further submits that the Plaintiff is entitled to the amount which includes service compensation for four years service i.e. Rs.56,000/-, notice pay one month salary as Rs.28,000/-, Leave, Bonus and Earned Wages, Renewal Incentives, NCD Collection Incentive, Quartely Interest Collection Incentive for September 2015 and salary for 5 months and 19 days amounting to Rs.3,43,325/- in total.
10. Ld. Counsel for Defendant raised the legal issue of non- maintainability of suit and urged that the same was hit by Section 14(1)(c) of Specific Relief Act, since the employment was determinable in nature. Counsel has argued that the suit was barred by Section 14(1)(c) of Specific Relief Act 1963 (in shot 'S R Act') which provided that the contract which was in its nature determinable could not be specifically enforced. Ld. Counsel argued that as per Clause 14 of the Letter of Placement dated 01.04.2014 which is not disputed by Plaintiff, the Plaintiff's services were terminated by giving him one month salary and therefore the contract which was determinable in nature i.e. by one month's notice and could not be specifically enforced. Ld. Counsel argued that in effect, specific performance of contract was sought by Plaintiff by seeking declaration of the termination notice as null and void. He argued that since the contract could not be specifically enforced, there could not be any relief of Declaration or injunction granted to the Plaintiff as Section 41(1)(e) of S R Act provides that injunction will not be granted to prevent breach of the contract, performance of which could not be specifically enforced. Digitally signed by RAVINDER CS 131/2016 Sh. Rajender Kumar Singhal v. M/s. Muthoot Finance Limited RAVINDER BEDI Page No.8 of 14 BEDI Date:
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11. Reliance is placed by Ld. Counsel for Defendant upon the judgments of Shri L.M. Khosla vs Thai Airways International Public Company Limited and Another, decided on 01.08.2012 and judgments Shri Satya Narain Garg through his legal heirs Vs. DCM Limited and Ors. decided on 5.12.2011; GE Capital Transportation Financial Services Ltd. Vs. Shri Tarun Bhargava decided on 20.3.2012 and an S.L.P. against this judgment dismissed by Hon'ble Supreme Court on 3.8.2012 in S.L.P. No.21723/2012 and Pawan Kumar Dalmia Vs. M/s. HCL Infosystems Ltd. and Ors. decided on 13.3.2012.
12. Counsel for Plaintiff, per contra, argued that the legal issue was not raised in pleadings by Defendant, therefore could not be considered at the stage of final submissions. He submits that the only plea taken by Defendant company is that Plaintiff was found doing strong room doing operations independently on 21.08.2014 and a report Ex. PW1/7 was submitted by AGM of Defendant Company. He submits that similar are the other contentions of Defendant that Plaintiff was misusing electricity and was found sleeping. He argues that inspite of these alleged misconducts, the Plaintiff's services were extended as is evident from the Letter dated 16.03.2015 upto 31.03.2016, meaning thereby, conduct of Plaintiff was satisfactory uptil 16.03.2015 without any gross indiscipline or any such similar act on his part. Therefore, it was argued that the plea of Defendant that Plaintiff was terminated on account of misconduct or indiscipline fell flat and was untenable.
Digitally signed by RAVINDER CS 131/2016 Sh. Rajender Kumar Singhal v. M/s. Muthoot Finance Limited RAVINDER BEDI Page No.9 of 14 BEDI Date:
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13. It is settled position under law that legal issue can be raised at any stage of proceedings and it is incumbent upon the Court to consider such issue on its own initiative, even if the same is not raised by the parties concerned. (State of Gujarat vs M/S. Kothari & Associates, DOD : 16 October, 2015).
14. It is the admitted case of plaintiff that the employment of Plaintiff was a private employment and was not a public employment which is protected like an employment with a State or an arm of a State as per Article 12 of the Constitution of India. Plaintiff has not disputed the Letter of Placement dated 01.04.2014 Ex.PW1/P5, which contains detailed terms and conditions of employment. Thus, before adverting to the evidence led by parties, it is imperative to discuss the nature of contract of employment between parties and the relevant settled law on the same as expounded by the Hon'ble Apex Court and Superior Courts of Law.
15. In the case of GE Capital Transportation Financial Services Ltd. (supra) and Shri Satya Narain Garg through his legal heirs Vs. DCM Limited and Ors. Decided on 5.12.2011, it was held that the contracts which are determinable in nature cannot be specifically enforced as per Section 14(1)
(c) of the Specific Relief Act, 1963. If the contract of employment provides for specific notice period, then, the maximum entitlement of damages of an employee who alleges illegal termination is specific period's pay.
Digitally signed by RAVINDER CS 131/2016 RAVINDER BEDI Sh. Rajender Kumar Singhal v. M/s. Muthoot Finance Limited BEDI Date:
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16. Hon'ble Supreme Court in the case of S.S. Shetty Vs. Bharat Nidhi (supra) observed that even if there is an illegal termination of an employee by a private employer, at best the employee is entitled to the salary for the notice period. Reliance can be placed further on L.M. Khosla Vs. Thai Airways (supra), decided by Hon'ble Delhi Court.
17. Plaintiff is governed by a private contract. Defendant terminated the services of Plaintiff by granting/offering one month's salary towards the notice period. What the Plaintiff alleges is that the act of his termination by the Defendant is illegal and against principles of natural justice. Since, it is not in dispute that the contract in the present case is determinable in nature; Plaintiff being in private employment, the Defendant has every right to terminate the services of their employees by giving specified notice period. Plaintiff at best is entitled to get salary for the notice period or during such period till the time he had not been employed to some other employment on principles of mitigation of losses.
18. Even presuming there was a breach of contract, only reasonable damages could be granted to Plaintiff. Once there is a clause for termination of services by notice, it can only be that notice period, which can be treated as reasonable damages in as much as parties understood the period for obtaining of an alternative employment (S.S. Shetty v. Bharat Nidhi (supra)).
Digitally signed by RAVINDER CS 131/2016 RAVINDER BEDI Sh. Rajender Kumar Singhal v. M/s. Muthoot Finance Limited BEDI Date: Page No.11 of 14 2022.10.01 18:02:05 +0530
19. In view of aforestated settled position under law, I hold that since the contract of employment was private in nature, it was determinable under law. Defendant already had offered Plaintiff, one month's salary in lieu of the Notice period. Plaintiff as such failed to establish that he had any cause of action against the Defendant's act of terminating him. Even as per the case of Plaintiff that the termination was illegal, the maximum effect of such an illegal termination could be his entitlement to the salary for period as per the contract. Having observed so, the issues stand decided against the Plaintiff and in favour of Defendant.
ISSUES No.3&4
3. Whether plaintiff is entitled to recover Rs.3,43,325/- as prayed for ? (OPP)
4. Whether Plaintiff is entitled for interest, if so at what rate and for what period ?
20. The onus of proving these issues was upon Plaintiff. Ld. Counsel for Plaintiff argued that the documents Ex.DW1/5 and Ex.DW1/6 were never given to Plaintiff. It is argued that Plaintiff a 66 years old man had to suffer on account of acts of Defendant. It is argued that Plaintiff was not claiming reinstatement but was claiming only his monetary service benefits, compensation and pending dues i.e. a sum of Rs.3,43,325/- alongwith interest @ 24% per annum from the date of filing of suit till its realization. Ld. Counsel argues that the allegations levelled by Defendant against Plaintiff Digitally signed CS 131/2016 by RAVINDER Sh. Rajender Kumar Singhal v. M/s. Muthoot Finance Limited RAVINDER BEDI Page No.12 of 14 BEDI Date:
2022.10.01 18:02:09 +0530 were far-fetched, imaginary and did not fall even within conditions of Ex.PW1/D5.
21. In Binny Ltd. & Anr. Vs. V. Sadasivan & Ors. (2005) 6 SCC 657, wherein it was held.
"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."
22. In view of the settled position as above and my observations in issues no.1&2, I hold that Plaintiff has failed to prove his entitlement for the reliefs claimed and as such, these issues also stand decided against Plaintiff.
Digitally
signed by
RAVINDER
CS 131/2016 RAVINDER BEDI
Sh. Rajender Kumar Singhal v. M/s. Muthoot Finance Limited Page No.13 of 14
BEDI Date:
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RELIEF
23. On account of my findings in issues no. 1&2, I hold that plaintiff has failed to prove his entitlement for relief for recovery of Rs.3,43,325/- as service compensation and other dues. The suit of the plaintiff stands dismissed.
Decree sheet of dismissal be prepared accordingly and file be consigned to records room after due compliance, as per rules.
Digitally signed by Announced in the open Court RAVINDER RAVINDER BEDI on 28.09.2022. BEDI Date: 2022.10.01 18:02:18 +0530 (RAVINDER BEDI) Additional District Judge-02 SHD/KKD/Delhi/28.09.2022. CS 131/2016 Sh. Rajender Kumar Singhal v. M/s. Muthoot Finance Limited Page No.14 of 14