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Judgment
Madhava Rao
This is a Second Appeal by the defendants. The respondent plaintiff filed the suit for a declaration that the order dated 27-10-73 of the defendants terminating his services is illegal and that he is entitled to all the consequential benefits. The learned 8th Assistant Judge, City Civil Court, Hyderabad, dismissed the suit. On appeal by the plaintiff, the learned Additional Chief Judge, City Civil Court, Hyderabad, by his judgment dated 20th March 1978 allowed the appeal and decreed the suit of the plaintiff as prayed for. Hence this second appeal by the defendants. The substantial questions of law on which this second, appeal was admitted are as under:--
(1) Whether as per the provisions of the Mines Act and Metalliferous Mines Regulations 1961 the post of the Mines Manager occupied by the respondent herein is statutory in character or it is purely contractual.
(2) When the appointment of the Mines Manager is obligatory, whether the relationship of the employer and the mines manager is purely one of master and servant or acquires any Statutory characteristics.
(3) When the relationship between the appellant and respondent being that of a Master and Servant, there cannot be any decree directing reinstatement of the respondent as it is prohibited by Section 14 (b) of the Specific Relief Act since no contract of personal service can be enforced by a court of law.
(4) Whether the respondent is entitled to a reasonable opportunity before his services are terminated.
To appreciate the above substantial questions of law, it is necessary to note the relevent facts of the case in brief.
The defendant--Company took on lease a white clay mine at Ralapet Village, Taluk Asifabad form the Government. The Defendant--Company manufactured salt closer stones ware pipes and fire bricks, having its office and factory at Bakaram, Hyderabad. The matter is governed by the Mines Act, 1952 u/s 57 of the said Act, Metalliferrous Mines regulations 1961 were formed which governed the matter in the suit. As per regulation 34 (1) no mine shall be opened, worked or re-opened unless there is a manager of the mine being a person duly appointed and having the qualifications as required by the regulations. The plaintiff possesses a Manager permit granted under Special Regulation (6) of regulation 34, which permit is grated) to a person holding overman''s or Foremen''s certificate of competency as provided in the Regulation 34 (5). Being so qualified the plaintiff was appointed by defendant No. 2.'' on 11-11-70 as the mines manager, Hyderabad Potteries Private Limited, Asifabad, and was confirmed after six months. It is alleged that the plaintiff was discharging his duties as per the Mines regulations. But the Office Manager of the Company issued a memo on 27-10-1973 terminating his service. The said memo is illegal being in contravention of the said regulations. The Office Manager is not competent to terminate the services of the plaintiff, The Defendants entrusted the mines to a contract or on tonnage basis which was to be carried out under the supervision of the plaintiff, Mines Manager. When the Plaintiff reported against the contractor to the Managing Director, instead of interfering in the matter, he called the Plaintiff to Hyderabad and got issued termination order by the 1st defendant. The whole conduct of the defendants is malafide and collusive with a view to dispense with the service of the plaintiff.
In the written statement filed by the defendants it is stated that the Rules and Regulations of Mines etc. do not govern the service conditions of the plaintiff. It is admitted that the plaintiff was appointed as the Mines Manager on temporary basis with effect from 11-11-1970. His services were not confirmed as his appointment was temporary.. The contention of the plaintiff that after six months his service were confirmed is denied. The Plaintiff was not performing the duties as cast upon him on the other hand, he was habituated to leave the place of duty at Asifabad. In fact, he expressed his difficulty in staying at Asifabad, since he was not on good terms with the contractors and others concerned. Thus, the purpose for which he was appointed was completely defeated. Therefore, the plaintiff''s service were terminated on 27-10-1973. There was no regulation imposed on the defendants to continue the plaintiff in employment as Mines Manager though he was not discharging his duties. Therefore, the order of termination is perfectly valid, legal and binding on the plaintiff. The Plaintiff was on inimical terms with the contractors with whom the plaintiff''s attitude was reported to be hostile and not conducive to the smooth running of the business. The action of the defendants is neither malafide nor motivated. Therefore the defendants after having exerted much restraint and forbearance were ultimately compelled to take the inevitable action of terminating the services of the plaintiff. As such, the action of the defendant is neither malafide nor otherwise motivated. There was neither collusion nor any unfair treatment towards the plaintiff. In fact the plaintiff proved to be incapable of discharging his duties. It is further alleged that the order of termination was passed by the competent authority and that the plaintiff cannot challenge the same. There is no procedure laid down in the Mines Regulation for the termination of the service.
On the above pleadings, the trial Court framed the following issues:--
1) Whether the order dated 27-1-1973 terminating plaintiff''s service is illegal, null and void?
2) Whether the court has no jurisdiction to entertain this suit?
3) To what relief?
The trial Court was of the opinion that the plaintiff was not appointed under the provisions of the mines Act. Consequently it held that the relationship between the plaintiff and the defendant was that of servant and master. The trial Court was of the view that even if the dismissal is wrongful, the declaration sought for cannot be given for the reason that the plaintiff does not come within the three categories viz., (1) the case of public servant who has been dismissed from service in contravention of Art. 311 of Constitution of India, (2) the case of an industrial employee who can be reinstated in industrial adjudication by a labour Court or an Industrial Court. (3) In the case of statutory body, its employees can be reinstated when it was acted in breach of mandatory obligation imposed by a state. It was further held that the plaintiff cannot claim to be reinstated in service as it amounts to enforcing the contract for personal service of the plaintiff by an order of Specific performance in contravention of Section 21 or the Specific Relief Act. It was also pointed out that the order being wrongful order, the plaintiff is only entitled to damages. Since the Plaintiff did not make any claim for damages the trial Court dismissed the suit.
Aggrieved by the said judgment, the plaintiff carried the matter in appeal.
The appellate Court framed the following points for consideration:--
1) Whether the relationship between the appellant and the respondents is that of Masters and Servant?
2) Whether the appellant was not given any opportunity of being heard before issuing the order of termination and as such the same is illegal.
The appellate Court held that ''the post of Mines Manager being a statutory, one it cannot be said that the relationship between the appellant and the respondents is that of master and servant". It also confirmed the finding of the trial court that no opportunity was given to the plaintiff and therefore the dismissal is wrong. Having held that the post of Mines Manager is a statutory one, "the defendants have violated the statutory rules and as such this Court has powers to declare the order of termination of plaintiff''s service as null and void". In the result, the appeal was allowed and the suit of the plaintiff was decreed.
The learned counsel for the appellant Shri K Srinivasa Murthy submitted that the appellate court erred in holding that the post of Mines Manager being created under the Mines Act and regulations framed thereunder, could not be equated to that of a post having statutory status. The learned judge has misconstrued and scope of come of the provisions of the Mines Act. The learned judge has not keep up the difference as to the creation of the post and the appointment of the person to the post. They are distinct and separate. The substantial questions of law raised, which are noted already, also post the same question whether the post of a Mines Manager occupied by the respondent is statutory in character or it is purely contractual. These points are dealt with under points 1 to 3. I will now examine the position of law in this respect.
The relevent provisions of law which have bearing on this aspect of the case are sections 17, 18 and 57 of the Mines Act. The relavent regulations will be referred to at the appropriate time. Section 17 reads thus:
Save as may be otherwise prescribed every mine shall be under one manager who shall have the prescribed qualifications and shall be responsible for the control, management, supervision and direction of the mine, and the owner or agent of every mine shall appoint himself or some other person having such qualifications, to be such manager.
Section 18 is in the following terms:--
Duties and responsibilities of owners, agents and managers:--
(1) the owner, agent and manager of every mine shall be responsible that all operations carried on in connection therewith are conducted in accordance with the provisions of this Act and of the regulations, rules and bye-laws and of any orders made thereunder.
2) In the event of any contravention of any such provisions by any person whosoever, the owner, agent and manager of the in he shall each be deemed also to be guilty of such contravention unless he proves that he had taken all reasonable means, by publishing and to the best of his power enforcing these provisions, to prevent such contravention.
3) It shall not be a defence in any proceedings brought against an owner or agent of a mine under this section that a manager of the mine has been appointed in accordance with the provisions of this act.
Section 57 of the Act gives power to the Central Government to make regulations in respect of the matters enumerated therein under several heads given under that section.
Section 57 (e) reads thus.--
For regulating the manner of ascertaining, by examination or otherwise, the qualifications of managers of mines and persons acting under them, and the granting and renewal of certificates of competency;
Section 17 empowers the owner to appoint a qualified manager. A reading of the provisions of section 18 makes it clear that reasonable care has to be taken in the discharge of duties and if there is any contravention by any person whosoever, the owner, agent and manager of the mine shall each be deemed also to be guilty of such contravention unless it is proved that be had taken all reasonable means to prevent such contravention. Sub-Section (3) goes a step further and points out that the owner or agent of the mine cannot put up a defence in any proceedings brought against him that a manager of a mine has been appointed in accordance with the provisions of the Act and therefore for the negligence of the duties of the manager, proceedings cannot be taken against him and he cannot be found guilty. To put it in other words, for the acts committed by the manager, the owner or agent becomes responsible.
Now I will take up the regulations framed u/s 57 of the Mines Act of 1952 by the Central Government, Regulation No. 34 speaks about the qualifications and appointment of managers. The qualifications of a person who is eligible to be appointed as manager are stated therein. Regulation No. 34 (1) (A) prohibits the opening of a mines unless there is a manager of the mine appointed. It reads as under:
(a) No mine shall be opened, worked or reopened unless there is a manager of the mine, being a person duly appointed; and having such qualifications as are required by these regulations.
(b) No person shall act or employed as a manager unless he is 23 years of age and is paid by, and is directly answerable to, the owner or agent of the mine.
In this connection Regulation No. 34 (8) is also relevant, It reads:--
34 (8) (a) No manager shall vacate his office without giving due notice in writing to the owner or agent at least 30 days before the day on which he wishes to vacate his office:
Provided that the owner or agent may permit the manager to vacate his office after giving a shorter notice.
(b) No owner or agent shall transfer, discharge or dismiss a manager unless he has been relieved by a duly qualified person as prescribed under sub-regulation (2).
Regulation 34 (9) (A) reads as under:--
34 (9) (a) The owner or agent shall provide suitable residential accommodation for the manager, the assistant manager and the underground manager within a distance of 3 miles from all mine openings; and every manager assistant manager and underground manager shall reside in the accommodation so provided:
Provided that where special difficulties exist which render compliance with these provisions not reasonably practicable, the Chief Inspector may, by an order in writing and subject to such conditions as he may specify therein, grant exemption from the same.
(b) No manager shall be entrusted by the owner or agent with any work nor shall be himself perform any work which will necessitate his frequent or prolonged absence from the mine.
Regulation 34 clearly envisages that a qualified person has to be appointed as a manager and be has to be always near about the mine as frequent and prolonged absence is almost prohibited. Sub-regulation (8) gives option to the manager to vacate the office after giving at least 30 days notice and if necessary he can vacate earlier if the owner or agent permits him to do so. Sub-regulation (8) (b) gives power to the owner or agent to transfer, discharge or dismiss a manager subject to the condition that the manager should be relieved by a duly qualified person as prescribed under sub-regulation (2). Sub-regulation (8) (c) permits the Chief Inspector to appoint any person, who is not duly qualified, to act as manager during the period of such notice.
It becomes evident that the power of the owner to dismiss the manager is there and it cannot be questioned by the manager. The only look out of the owner is that unless he is replaced by another manager, dismissal should not be ordered for the reason that the mine cannot be operated in the absence of a manager. If the mine is operated without a manager, the owner will have to bear the consequences therefor. But the power to dismiss a manager cannot be disputed.
It is not pointed out during the course of the arguments that what procedure has to be adopted for dismissal of a manager from service. I have noted the relevant provisions that have got a bearing on this case.. Now the point urged is whether the manager has got a statutory status. We have to understand the meaning of the expression "statutory status".
Under the Mines Act 1952 whenever a mine is taken on lease, it has to be worked out according to the conditions imposed under the regulations. Chapter IV of the Mines Act relates to the mining operations and management of mines. Section 16 says that the owner, or agent or manager of a mine shall, before the commencement of any mining operation, give notice in writing to the Chief Inspector, the Director, Indian Bureau of mines and the District Magistrate of the district in which the mine is situate, in such form and containing such particulars relating to the mine as may be prescribed. Section 17, which I have already extracted above, is about the appointment of managers. What it provides is that each mine shall be under one manager who shall have the prescribed qualifications and shall be responsible for the control, management, supervision and direction of the mine and the owner or agent of every mine shall appoint him who will have to carry out the operations according to the provisions of the Act. Not only the manager but even the owner and agent were made responsible for all the operations, u/s 18, of the Mining Act, thus, for the operation of a mine, a manager is required. But the exclusive right to appoint him is given to the owner or agent and full control could be with the owner for the reason that if any proceedings are taken for the contravention of any of the provisions, each of the persons i.e., owner, agent and the manager could also held to be guilty. Even if the manager contravenes the provision, it is deemed that the owner or agent is guilty of such contravention. Therefore, it becomes necessary for the owner or agent to supervise the activities of the manager and if the manager is not acting properly, the owner is responsible to the acts of the manager and be has a right to take appropriate action and if necessary, in my view, dismisses him from service and that right is also clarified under Regulation 34 (8) (a) also.
When these are the provisions made could it be said that when a manager is appointed, that person is given "statutory status".
The learned counsel for the appellant relied upon the decisions in Executive Committee, U.P. Warehousing Corporation Vs. Chandra Kiran Tyagi, & Executive Committee of Vaish Degree College, Shamli and Others Vs. Lakshmi Narain and Others, and The Ahmedabad St. Xavier''s College Society and Another Vs. State of Gujarat and Another,
The learned counsel for the respondent, on the other hand, contended that the post of mines Manager was created by a statute viz., the mines Act. when the post is created by a statute, even the appellant should be conferred a statutory status In this connection he referred to the Judgment in W.A. No. 424 of 76 dated 21-9-76. It was submitted by him mat the order of the appellate court by him should be upheld on two grounds viz., (i) that the person who terminated the services of the plaintiff was not competent to do so and (2) that the principles of natural justice are not followed in terminating the services of the plaintiff. The learned counsel referred to the decisions in Ramswarup V. N.P. Co-operative M.F. Ltd (M.P). 1976 (2) SLR 454
The learned counsel also alternatively submitted that the plaintiff has filed a petition for amendment of the plaint and claimed damages for wrongful dismissal. If for any reason the suit is not decreed as prayed for the petition filed for amendment of the plaint be considered and the plaintiff permitted to claim damages.
I will now take up the point raised by the learned counsel whether statutory status is given to the plaintiff in the instant case, I have already referred to the Sections and Regulations that are relevant. The mines Act provides for the appointment of a manager for mines, but the power to appoint manager is given to the owner or his agent. The terms and conditions of service are to be entered into by the owner and the Manager. There are no rules stipulating the conditions of service with regard to the Manager''s post under the Mines Act. There are also no regulations framed enumerating the conditions of service under which disciplinary action can be taken or to remove or dismiss from service. Therefore, the parties are governed by contract of service. This cannot be termed as statutory appointment. If it is a statutory appointment, the appointment has to be made under the statute itself, and there is no need to enter into a contract for appointment. In Executive Committee, U.P. Warehousing Corporation Vs. Chandra Kiran Tyagi, this question was considered by the Supreme Court. In that case the respondent-plaintiff originally entered service with the appellant as a Technical Assistant in November, 1958 and later he was promoted to the poet of warehouseman on October 15, 1959. He was confirmed in 1962 in the said post. Certain charges were framed against him and pending the enquiry into these charges, he was placed under suspension on September 9, 1963. After an enquiry the respondent was found guilty. Consequently, he was dismissed from the service by the Executive committee of Uttar Pradesh State Warehousing Corporation, Lucknow, the appellant before the Supreme Court. The respondent Chandra Kiran Tyagi filed a civil suit challenging the order of dismissal on various grounds including the ground that the principles of natural justice were not followed. He also claimed that be was entitled to the protection under Article 311 of the Constitution. He prayed for a declaration that the order dismissing him from services was null and void and that he was entitled to be reinstated with full pay and other emoluments. In the written statement filed by the appellant-defendant, it was pleaded that the respondent was not entitled to the protection of Article 311 of the Constitution, and that the plaintiff had been given full opportunity to participate in the enquiry which he also did. The defendant further pleaded that the order of dismissal passed against the respondent was perfectly justified and that the suit was false and had to be dismissed with costs. The trial court held that the plaintiff was not entitled to the protection under Art. 311 of the Constitution. But it held that the enquiry was not proper. Ultimately it granted a declaration that the order of dismissal was void and ineffective and decreed the suit with costs.
Against the order, and appeal was filed by the defendant. The Plaintiff filed cross-objections challenging the decree of the trial court declining his relief for reinstatement with full pay. The appellate court dismissed the appeal and allowed the memorandum of cross objections filed by the respondent-plaintiff. The result was that the Plaintiff''s suit was decreed granting both the reliefs as prayed for by him. The defendant-warehousing Corporation took the matter in appeal to the High Court. The High Court also by its judgment dated October 25, 1966 dismissed the appeal. Aggrieved by the judgment of the High Court, the Warehousing Corporation preferred an appeal to the Supreme Court. The Supreme Court exhaustively dealt with the matter and referred to several decisions, which include the decisions in S.R. Tewari Vs. District Board Agra and Another, , S.B. Dutt Vs. University of Delhi, , Berber vs. Manchester Hospital Board, and Vine B. National Dock Labour Board (1956) 1956-3, All. ER. 939 = 1957-2 WLR 106.
After examining the case law, Vaidyalinga, J. speaking for the Bench has drawn some conclusions which have been incorporated in paragraph 23 of the judgment with reference to two decisions, as under;
From the two decisions of this court, referred to above, the position in law is that no declaration to enforce a contract of personal service will be normally granted. But there are certain well recognised exceptions to this rule and they are to grant such a declaration in appropriate cases regarding (1) a public servant, who has been dismissed from service in contravention of Article 311. (2). Reinstatement of a dismissed worker under Industrial Law by Labour or Industrial Tribunals. (3) A statutory body when it has acted in breach of a mandatory obligation, imposed by statute.
It was made clear that the case of the respondent before them did not come under either the first or the second category. The question then remained was whether relief could be granted under the 3rd category? As pointed out in the judgment, the regulations were made under the power reserved to the corporation u/s 54 of the Act, not inconsistent with the Act and the rules made thereunder. Those regulations provided for all matters for which provision was necessary or expedient for the purpose of giving effect to the provisions of the Act. It was found that there was violation of regulation 16 (3). Therefore, it was held as under:--
Under the circumstances, a violation of regulation 16 (3) as alleged and established in this section, can only result in the order of dismissal being held to be wrongful and, in consequences making the appellate liable for damages. But the said order cannot be held to be one which is not terminated the service albeit wrongfully or which entitled the respondent to ignore to ask for being treated as still in service. We are not concerned with the question of damages because no such claims has been made by the respondent in these proceedings.
The next important authority relied upon by the learned counsel for the appellants in Executive Committee of Vaish Degree College, Shamli and Others Vs. Lakshmi Narain and Others, The question that arose therein was, whether the services of a principal of a college whose appointment was to be formally approved by the Vice-Chancellor of the Agra University could be terminated by the Executive Committee without the approval of the Vice Chancellor. The services of the principal were terminated by a resolution passed by the Executive Committee of the Vaish Degree College. This gave rise to the institution of a suit by the principal, mainly contending that the Vaish degree college being affiliated to the Agra University and subsequently to the Meerut University, and having adopted the provisions of the Act and statutes of the said universities, became a statutory body and therefore the Executive committee had no jurisdiction to terminate his service without the prior approval of the Vice-Chancellor. After his appointment the principal entered into an agreement with the Executive Committee in accordance with the statue of the university and his appointment was, therefore, bound by the terms and provisions of the statute and his services could be terminated only with the prior approval of the Vice Chancellor as per the provisions of these statutes. Therefore, it is contended that his removal from the office was without jurisdiction and therefore must be deemed to have been continuing in service. Accordingly he prayed for an injunction retraining the defendant from interfering with the discharge of his duties as the principal of the college. The defence was that the executive committee was not a statutory body and therefore not bound by the statutes and various provisions of the University Acts, although as a matter of convention it had agreed to follow the same. It was denied that the defendant had entered into any agreement or contract with the plaintiff. It was further alleged that the plaintiff habitually and perpetually remained absent from his duties without the permission of the concerned authority and therefore the defendant was compelled to dispense with the service of the plaintiff. In fact the plea taken by the defendant was that the plaintiffs himself by his remaining perpetuality absent from duties abandoned the service and had put an end to the contract of service and therefore he could not be heard to say that the contract of service still subsisted. The trial court found that there was no agreement entered into with the defendant and that the defendant not being a statutory body was not bound by the provisions of the University Acts or the statues made thereunder. The trial court ultimately holding that no case was made out for the issue of an injunction or for declaration dismissed the suit. On appeal the 1st additional Civil and Sessions Judge reversed the judgment of the trial Court and decreed the suit granting the injunction as prayed for. The defendant filed a second appeal in the High Court of Allahabad, The learned Single Judge referred the matter to the Full Bench framing the issue:
Can the Civil Court grant the relief of Injunction in view of the facts and circumstances of the present case:
The full Bench in its turn framed the following points for its decision.
(1) that the defendant/appellant being a statutory body was bound by the provisions of the university Acts and the statues made thereunder and therefore the termination of the services of the plaintiff/respondent without obtaining the sanction of the Vice-Chancellor was illegal and invalid, and
(2) That in view of the facts and circumstances of the case, the Plaintiff/respondent was entitled to the injunction as prayed for.
The Full Bench affirmed the decree and judgment of the 1st Appellate Court. The defendant carried the matter to the Supreme Court by obtaining special leave. The main point raised before the Supreme Court was;
Whether or not the appellant Executive Committee can be said to be a statutory body in the circumstances of the present case.
Justice Fazil Ali speaking for self and on behalf of Justice Khanna observed in paragraph-9, thus ;
It seems to us that before an institution can be a statutory body it must be created by or under the statute and owe its existence to a statute. This must be the primary thing which has got to be established. Here a distinction must be made between an institution which is not created by or under a Statute but is governed by certain statutory provisions for the proper maintenance and administration of the institution. There have been a number of institutions which though not created by or under any statute have adopted certain statutory provisions., but they by itself is not, in our opinion, sufficient to clothe the institution with a statutory character.
The test as laid down by His lordship is as follows:
The positition seems to be that the institution concerned must owe its very existence to a statute which would be the fountain bead of its powers. The question in such cases to be asked is, if there is no statute would the institution have any legal existence.
If the answer is in the negative, then undoubtedly it is a statutory body, but if the institution has a separate existence of its own without any reference to the statute concerned but is merely governed by the statutory provisions it cannot be said to be a statutory body. The High Court in our opinion, was in error in holding that merely because the Executive Committee followed certain statutory provisions of the University Act or the statutes made thereunder it roust be deemed to be a statutory body. In fact the full bench of the High Court relied on three circumstances in order to hold that the Executive committee was a statutory body, viz.; (i) that it was affiliated the Agra University which was established by the statute; (ii) that there were certain mandatory provisions in the Agra University Act, which were binding on the Executive Committee; and (in) that the Executive Committee was governed by the statutes framed by the Agra University. In our opinion, none of these factors would be sufficient to alter the character and nature of the Executive Committee and convert into a lull pledged statutory body. To begin with the Executive Committee had an independent status having been registered under the Registration of Co-operative Societies Act and was a self governed or an Autonomous body. It was affiliated to the Agra University merely for the sake of convenience and mainly for the purpose that the course of studies prevalent in the college may be recognised by the University. Thus, the view taken by the Allahabad High Court that the Executive Committee was a statutory body was held to be not Valid and correct. Bhagawti, J., who delievered a separate Judgment expressed the view that the language used in section 28 (2) of the Kanpur and Meerut Universities Act is absolute and peremptory and leaves no doubt as to its meaning and effect and that it provides in terms clear and unambiguous that the termination of service of a teacher by the management shall not take effect, that is, it shall be ineffective and inoperative unless the Vice Chancellor on being informed has approved of it when that section which is a law made by the legislature, has enacted that the termination of service shall be ineffective or and inoperative, it shall have no validity or force unless it has been approved by the Vice Chancellor, it is difficult to see bow it can be regarded as effectively terminating the services. To take such a view would be to refuse to give effect to the law enacted by the legislature. The law enacted in this section operates, irrespective whether the management is or is not a statutory body. Such a consideration is entirely irrelevant to the applicability of this section, when the section says that the termination of service shall not have any effect the Court must refuse to (sic) the termination as valid and effective and when the Court does so, it merely enforces the law and there is no question of transgressing the principle that a contract of personal service cannot be enforced. There can, therefore, be no doubt that the termination of service of the plaintiff by the appellant defendant was ineffective and void and it did not operate to put an end to the employment, even wrongfully, by reason of section 28 (2) of the Act. However, keeping in view the provisions of the Specific Relief Act that grant of declaration and injuctions is discretionary, His Lordship agreed with the conclusions drawn by Fazil Ali, J., and the appeal filed by the Executive Committee was allowed, by which an aggregate amount of Rs. 21,100/- was considered to be fair and just compensation payable to the principal. The learned counsel for the respondent, Shri Suryaprakash Rao, referred to Ramswarup vs. M.P Co-operative M.F. Ltd. 1976 (2) SLR 454. This is a decision of the Full Bench of Madhya Pradesh High Court. The points for decision before the Full Bench were as under:--
(i) Whether Cooperative Society, registered under the M.P. Co-Operative Societies Act is a statutory body?
(ii) Whether a writ of mandamus, direction or order can be issued under Article 226 of the Constitution by a High Court against Co-operative Societies Registered under M.P. Cooperative Societies Act, 1960 ?
(iii) Whether the High Court can issue an appropriate writ, direction or order against a Co-operative Society or its officer, who has, in violation of the Act, rules or by-laws, dismissed its employee or terminated his service, for reinstatement and or with back wages ?
The Full Bench answered the first point in the negative and the third point in the affirmative. On the second point it held that the Co-operative Society will be amenable to writ jurisdiction only in cases relating to performance of legal obligations and duties imposed by a statute creating a corresponding legal right in one. The learned counsel for the respondent referred to the proposition laid down therein that when the dismissal or termination of provisions is in contravention of the statutory provision writ can be issued. Whenever there is a statutory requirement directing the society to perform the same and if the society does not obey it and acts in violation of the same, the person who comes to the Court claiming a writ does not come for the performance of the contract of service, but virtually comes for the enforcement of his legal rights, created in his favour by virtue of the provisions of the Statute, directing the Society to act in a particular manner. In view of the above dictum, the learned counsel for the respondent submitted that as there is a violation of the mandatory provisions of the Mines Act in the present case in terminating the services of the manager, this Court is certainly empowered to declare the terminations as void. A reference was also made to the judgment in E.C.I.L. ...vs.. State of Andhra Pradesh W.A. No. 424 of 1976 dated 21-9-1976. In that appeal three contentions were raised. The contention relevant in this case is that it was not competent for the Government to reinstate the 2nd respondent in service since the relationship between the petitioner company and the 2nd respondent was that of a master and servant and there was no question of statutory so far as the 2nd respondent was concerned. Several relevant provisions of the Factories Act and the rules framed thereunder were dealt with. The 2nd Respondent was a Labour Officer and his services were terminated by the petitioner company. The appointment of the Labour Officer should be in conformity with the Factories Act and the rules framed thereunder. Under sub-rule (4) of Rule 76-A the conditions of service of the welfare officer have been prescribed and the relevant clauses (clauses (iii), (iv) and (v)) had a bearing on that case. Clause (iii) provided that the services of a Welfare Officer shall not be dispensed with, nor shall be reverted without the written concurrence of the Commissioner of Labour, Hyderabad. Clause (iv) provided that no punishment such as withholding of increment, keeping under suspension, dismissal or termination of service, except censure, shall be imposed by the Management on Welfare Officer, except with the concurrence of the Labour Commissioner. Clause (v) provided that a welfare Officer, who has been dismissed from service or whose services have been terminated in any other manner other than as provided under clause (iv) may prefer an appeal to the State Government against such order and the order of the State Government shell be final. In that case the Welfare Officer, whose services were terminated, preferred an appeal before the State government and the Government reinstated him. The company filed a writ petition. Even though the learned single judge held that the appeal in those circumstances was not competent to be entertained by the Government, but having found that the dismissal order was not justified and the order of reinstatement passed by the State Government was proper, refused to exercise the discretionary power under Article 226 of the Constitution and dismissed the writ petition. On appeal the Bench held that the appointment of the Labour Officer was under the Factories Act and hence statutory status was given to the employee and that there has been a violation of the provisions of the statute while terminating the services of the Welfare Officer. The bench further held that the petitioner company was not a statutory body, in the sense explained by the Supreme Court in Executive Committee of Vaish Degree College, Shamli and Others Vs. Lakshmi Narain and Others, . Accordingly it was declared that the order of termination was null and void, and that be continues to be in service.
I have referred to the various decisions relied upon by the learned counsel and extracted the provisions of the Mines Act having bearing on the instant case at the beginning of the judgment. The learned counsel for the respondent contended that the manager is appointed u/s 17 of the Mines Act. Section 18 provides for the duties and responsibilities of the owners, agents and managers. Regulation 34 speaks about the qualifications and appointment of managers. Sub-regulation (8) (b) provides that no owner or agent shall transfer, discharge or dismiss a manager unless the manager has been relieved by a duly qualified person as prescribed under sub-regulation (2). The contention of the learned counsel for the respondent is that when the post of manager is created under the Mines Act, the person appointed to that post acquires statutory status and the ordinary relationship of master and servant does not remain. The learned counsel for the appellant on the other hand contended that under the scheme of the Act a manager has to be appointed for the operation of the mine, i.e., whoever takes the mine for operation it is necessary for him to appoint a manager. Section 18 clothes the full responsibility on the owner and makes him liable for contravention of any of the provisions. Under regulation 34 no rules have been framed as to the manager of discharging or terminating the services of the manager. The only limitation imposed on the owner under regulation 34 (8) (b) was that he shall not transfer, discharge or dismiss a manager unless the manager has been relieved by a duly qualified person as prescribed under sub-regulation (2). This limitation is imposed on the owner in view of section 17 of the Mines Act, which provided that every mine shall be under one manager who shall have the prescribed qualifications and shall be responsible for the control, management, supervision and directions of mine and the owner or agent of every mine shall appoint himself or such qualified person as the manager. It is only with a view to keep in consonance with this mandatory provision that it was provided that unless an alternative arrangement is made the manager could not be relieved either by way of transfer, discharge or dismissal. This does not mean that the owner cannot terminate or dismiss the manager. There are no provisions either in the Act or in the Regulation that the dismissal or termination of the services of the manager shall be with the approval or concurrence of any statutory authority. In my view, this argument carries sufficient force. We have already referred to the judgment in E.C.I.L. vs. State of A.P. W.A. No. 424/76 dt. 21-9-1976.
There the labour Officer could not be dismissed or removed without the prior approval of the Commissioner of labour as per the statute. In the absence of any such statutory provisions with regard to the conditions of service for the manager appointed under the Mines Act, in my view, the principles enunciated in that writ appeal have no application to the facts of the present case. The principle laid down in Executive Committee of Vaish Degree College, Shamli and Others Vs. Lakshmi Narain and Others, are clearly applicable to the instant case. The respondent, in my view, is not given any statutory status and is therefore not entitled to the protection under any provision of law, the breach of which he can made a complaint of. Therefore, he cannot seek any declaration that the order of termination is null and void and that he should be deemed to be continuing in service.
The learned counsel for the appellant further pointed out that a statute may direct a person to be appointed in an institution, who possesses certain qualifications. The institution has to appoint such persons having these qualifications but so far as the appoint of the person to that post is concerned, it is within the discretion of the management and the conditions of service of that person shall be governed by the terms of contract This position is simply explained in The Ahmedabad St. Xavier''s College Society and Another Vs. State of Gujarat and Another, . This authority pertains to the affiliation of a college It is observed there that affiliation is regulating the educational character and content of the minority institutions. These regulations are not only reasonable in the interest of general secular education but also conduce to the improvement in the statute and strength of the minority institutions. Therefore, measures which will regulate the course of study, the qualifications and appointment of teachers the conditions of employment of teachers, the health and hygine of students, facilities for libraries and laboratories are all comprised in matters germane to affiliation of minority institutions these regulatory measures for affiliation are for uniformity, efficiency and excellence in educational courses and do not violate any fundamental right of the minority institutions under Article. 30. The standards fixed for selection of the teachers do not in any way effect the powers of the management to deal with their servants. In the instant case a qualified manager has to be appointed and the qualifications are enumerated in the regulations. If a manager possessing the requisite qualifications is not appointed the owner may not be permitted to operate the mines to his own disadvantage. It is also noted that in certain cases even exemption from certain qualifications of the manager can be obtained. But the service, conditions are not statutorily provided and for the purpose of termination of his services no statutory provision was necessary to be complained of the termination of his services as void being in violation of some statutory provisions and seek for a declaration that the termination is void and that he should be deemed to be continuing in service.
The learned counsel for the respondent contended that the person who terminated the services is not competent. There is no issue framed in this respect by the trail Court and this allegation was denied by the defendant. In this second appeal, this question cannot be permitted to be agitated.
The learned counsel for the respondent further urged that the principles of natural justice were violated since he was not, given an adequate opportunity to represent his case. The lower appellate Court held that the defendants have not produced any record into the Court to show that the plaintiff was given any opportunity to represent his case before issuing the termination order. Therefore the order of termination is null and void. The trial court was also of the view that the plaintiff was not given an opportunity and therefore it is wrongful and therefore the plaintiff is entitled to damages only. But the trial court found that no claim for damages was made and therefore, it held that the same could not be considered. In this second appeal the question that there was no adequate opportunity given to the plaintiff may be true, but that itself is not sufficient to declare that the order of termination is illegal and void. At best the termination is wrongful and he may entitled to damages. After filing the 1st appeal, I.A. No. 482/77 was filed on 7-10-78 for amendment of the plaint claiming alternative relief of damages for wrongful termination of his services. But as the appeal itself was allowed and the suit was decreed, it was though unnecessary to allow the alternative claim for damages and therefore that I.A. was dismissed. In this second appeal, the learned counsel for the respondent pressed that I.A., stating that if the suit is liable to be dismissed on the ground that the plaintiff has no statutory status and the termination of his services is not violation of any statutory provisions, the termination being held to be wrongful, he may be awarded compensation. This submission, in my view, is proper and justified. When both the courts below found that the termination was bad and wrongful, he is certainly entitled to claim damages. Therefore the petition claiming damages deserves to be allowed and it is accordingly allowed. But the quantum of damages cannot be fixed up on this second appeal as it requires recording of evidence. Therefore, the suit is remanded to the appellate Court only for the purpose of permitting the plaintiff to amend the plaint making a claim for damages. The appellate Court shall record evidence on the question of damages and dispose of the matter on merits. In the result, the second appeal is allowed and the relief claimed in the suit for declaration that the termination of the services of the plaintiff is void and that he should be deemed to be continuing in service is rejected, But as the application for amendment of the plaint claiming damages is allowed, the appeal (suit) is remanded to the lower appellate court for permitting the bringing in of the amendment after issuing notice to the plaintiff. It shall permit the defendant to file any additional written statement consequent upon the amendment and shall inquire the quantum of damages after recording evidence of both parties and decide the matter on merits. The parties will bear their own costs throughout up to this stage.