CIVIL APPELLATE JURISDICTION: Civil Appeal No. 917 of 1989 etc.
From the Judgment and Order dated 15.12.1988 of the Allahabad High Court in C.M.W.P. No. 10059 of 1987.
Yogeshwar Prasad, Satish Chandra, Mrs. S. Dixit and Mukul Mudgal for the Appellants. A.K. Srivastava for the Respondents. The Judgment of the Court was delivered by
K. JAGANNATHA SHETTY, J. This is the third time the matter is coming before this Court and we hope that this is the last of a series of litigations between the parties.
We have been helpfully provided with a chronology of the events leading up to this appeal. It is important that the chronology is made clear. It is as follows:
At Allahabad, there is a private college called "Kulbhaskar Ashram Agriculture Intermediate College". It is run by the "Kayastha Pathshala" which is a society registered under the Societies Registration Act. Rajendra Prasad, the common respondent in the appeals, was a Chemistry lecturer in that College. He was appointed on 15 July 1962 in the scale of Rs. 175-10-2 15. On 20 June 1963, the management wrote to him stating that his services would not be required after 15 July’ 1963. It was indeed a termination letter. The respondent moved the Civil Court with suit No. 422/1963 for permanent injunction restraining the management from interfering with his teaching work. The management resisted the suit inter alia, contending that the respondent was appointed only for one year. He was removed after the period of probation since his work was found to be unsatisfactory. It was also contended that no injunction could be granted for enforcement of the contract of personal service and the suit was not maintainable. On 20 May 1964, the Trial Court dismissed the suit as not maintainable. It was also held that the suit had become infructuous since the management had withdrawn the impugned communication.
It seems that the management had withdrawn its earlier communication only to make another order. On 28 August 1964, the respondent was placed under suspension and he again approached the Civil Court for relief. He instituted suit No. 198 of 1964 in the Munsif Court seeking a declaration that the order of suspension was illegal. The trial court dismissed the suit, but the appeal therefrom, F.A. No. 583/1965, was allowed by the First Additional Civil Judge, Allahabad decreeing the suit as prayed for. That decision was affirmed by the High Court in Second Appeal No. 1111 of 1966. The High Court rendered the judgment on 9 April 1968. Before the disposal of the appeal by the High Court, the management made a fresh order suspending the respondent pending enquiry on certain allegations- That order was issued on 30 December 1965/7 January 1966. This order was also the subject matter of a suit. The respondent filed Civil Suit No. 48 of 1966 in the Munsif Court at Allahabad challenging the competency of the managing committee to take action against him. He also contended that the prior approval of District Inspector of Schools (DIOS) was not taken for placing him under suspension- The Munsif Court accepted the suit and declared that the suspension order was illegal and void. But the management successfully took up the matter of Civil Appeal No. 117 of 1969 before the Additional Civil Judge. The appeal was allowed reversing the trial court decree and upholding the respondent’s suspension. The respondent preferred second appeal to the High Court and it was numbered as S.A. No. 2038 of 1970. We may stop here for a moment and refer to some other events.
During the pendency of the said second appeal in the High Court, the U.P. Secondary Education Laws (Amendment) Act, 1976, was brought into force with effect from 18 August 1976. The provisions thereunder required the management of the college to take prior approval of DIDS for taking any action against teaching staff. The respondent took advantage of those provisions and made an application for amendment of his plaint to incorporate additional paragraphs 13-A and 14(g). In the additional paragraphs, he challenged the validity of the suspension order since management did not take prior permission of the DIOS. It was alleged that the suspension order became invalid and inoperative on the expiry of 60 days from the date of service.
The State of Uttar Pradesh was not a party to the original suit. For the first time, on 31 October 1980 the respondent made an application for impleading the State of U.P. and DIOS as supplemental respondents to the appeal. Their impleading was perhaps necessitated in view of the liability of the State Government to pay salaries to teachers under the U.P. High School and Intermediate College (Payment of Salaries of Teachers and Other employees) Act, 1971. Section 10(1) of the Act provides that the State Government shall be liable to payment of salaries of teachers and employees of every institution due in respect of any period after March 31, 1971.
The High Court did not consider it necessary to allow the said amendment of the plaint. But the respondent succeeded in this Court. By order dated 20 April 1980 the Court allowed his appeal and directed the High Court to allow the amendment. The second appeal No. 2038 of 1970 thus fell for consideration in the light of fresh points raised in the amplified plaint.
Next, as to proximity, there is one other related litigation between the same parties. It is now necessary to refer to it. The respondent filed a suit for recovery of arrears of salary past, pendente lite and future. It was claimed for the period between 21 February 1964 and 20 February 1967. That suit was filed in 1968 and registered as Civil suit No. 53 of 1968. On 31 July 1969, the trial court decreed the suit for Rs.7812.92 being the arrears of salary for the period of three years. The management of the college appealed to the District Court in Civil Appeal No. 268 of 1969. The respondent filed a cross objection to the extent of the relief denied to him. The second appeal no. 2038 of 1970 was then pending in the High Court. It seems that the parties moved the High Court for withdrawal of C.A. No. 268 of 1969 from the District Court for being disposed of along with the second appeal No. 2038 of 1970. That request was allowed and the said appeal was withdrawn. It was renumbered by the High Court as First Appeal No. 450 of 1982.
The High Court disposed of both the said appeals by common judgment dated 22 October 1982. The second appeal No. 2038 of 1970 was dismissed confirming the finding of the Additional Civil Judge as to the validity of the suspension order. The first appeal No. 450 of 1982 was allowed reversing the decree of the trial court and dismissing the respondent’s suit for arrears of salary. His claim for pendente lite salary also vanished along with that.
The respondent stopped into this Court for the second time. Being aggrieved by the decision of the High Court, he appealed to this Court in C.A. No. 5891 of 1983. The appeal was allowed by a brief order dated 25 September 1986 which has since been reported in AIR 1987 SC 1644. For immediate reference we may set out the same hereunder:
"The High Court in the judgment recorded the
following findings:
"The result is, as noticed above, that al-
though it cannot be said that the order dated
30 December 1965/7 January 1966 suspending the
plaintiff from service of the defendant col-
lege was illegal or null and void inoperative
against the
plaintiff from its inception, it did cease to
be operative with effect from 17 October 1975
on the expiry of 60 days from the commencement
of the U.P. Secondary Education Laws (Amend-
ment) Act, 1975.
Having recorded this finding, the
High Court refused to exercise its discretion
to grant a declaration that the order of
suspension ceased to be operative with effect
from 17 October 1975. We think that the High
Court was wrong in refusing to grant the
declaration. We, therefore, declare that the
order of suspension ceased to be operative
with effect from 17 October 1975. The appeal
against the judgment of the High Court in
second appeal No. 2038 of 1970 is disposed of
accordingly.
In the appeal against the judgment
of the High Court in First Appeal No. 450 of
1982 we do not see how the appellant can be
denied his salary for the period between 20
February 1964 to 15 January 1966, the date on
which the effective order of suspension was
communicated to him. Instead of sending the
case back to the trial court for determining
the amount, we think that a decree may
straight away be passed for a sum of Rs.
10,000 which will include salary for the
period, interest up to date and costs."
With due apologies for this lengthy introduction, we then come to the proceeding out of which the present appeals arise. On 18 May 1986 the respondent moved the High Court under Article 226 of the Constitution seeking a writ of Mandamus against the State of U.P. and management of the college for his reinstatement in service with payment of entire arrears of salary. He rested his case on the aforesaid decision. This High Court accepted the writ petition and gave him all the reliefs asked for. As to the validity of suspension order, the High Court remarked:
"The order of suspension being illegal was
correctly set aside by the Supreme Court after
the enforcement of U.P. Secondary Education
Laws (Amendment) Act, 1975 as none of the
conditions mentioned in sub-section (5) of
Section 16-G of the Act were fulfilled as no
charges were framed against the petitioner,
nor any charge sheet was served on
him .............. The petitioner, there-
fore,
could not have been suspended and the order of
suspension, in our view, was void ab initio.
Under law there was no provision to keep the
petitioner under suspension for more than 21
years without enquiry being held and without
any charge sheet being submitted. The peti-
tioner has a legal right to continue in serv-
ice and we direct him to be reinstated forth-
with." As regards the arrears of salary, the High Court observed:
"Once the order of suspension ceased to
be operative and was ab initio void from its
very inception, the petitioner shall be deemed
to be in continuous service. That application
of the petitioner was sent to State of U.P.
through the Education Secretary and also the
District Inspector of Schools. The District
Inspector of Schools has already sent a letter
dated 7.1. 1987 (Annx. 28) to the Manager,
Kulbhaskar Ashram Agriculture Intermediate
College, Allahabad about the payment of ar-
rears of salary to the petitioner. But the
Manager and the State of U.P. do not seem to
be interested in making payment of arrears of
salary to the petitioner. We are accordingly
of the opinion that the petitioner has made
out a case for issuance of a writ of mandamus
directing the State of U.P. and the District
Inspector of Schools, Allahabad to make pay-
ment of arrears of salary to the petitioner in
view of Section 10 and prior to that date the
arrears of pay and other emoluments would be
payable by the institution. In case the insti-
tution fails to make payment the procedure
under Section 11 of the Payment of Salaries
Act may be adopted." Finally, the High Court issued the following directions:
"In view of the premises aforesaid, the
present petition succeeds and is allowed
Respondents Nos. 1 and 2 the State of Uttar
Pradesh and the District Inspector of Schools,
Allahabad are directed to make payment of
salary to the petitioner since 16.1.1966 till
date, forthwith including D.A. and other
emoluments admissible under law, of course,
after deducting the amount, if any, paid to
him as subsistence allowance during the period
of his suspension. We further add that the
petitioner shall be reinstated forthwith and
shall be paid his salary regularly in accord-
ance
with the provisions of Section 3 of the Pay-
ment of Salaries Act, 1971."
Challenging the judgment of the High Court, the management as well as State Government by obtaining leave have now appealed. This how the matter is coming before the Court for the third time.
The first question for consideration is whether the High Court was justified in directing reinstatement of the respondent? There is a long established rule of Courts that service contract cannot be specifically enforced. There are, however, three exceptions which have been adverted to in very many cases. In Vaish Degree College v. Lakshmi Narain, [1976] 2 SCC 68 at 71 after examining a large v. number of authorities like: S.R. Tiwari v. District Board, Agra and Anr., [1964] 3 SCR 55, 59: The Executive Committee of U.P. Warehousing Corpora,on Ltd v. Chandra Kiran Tyagi, [1970] 3 SCR 250, 265: Bank of Baroda v. Jewan Lal Mehrotra, [1970] 3 SCC 677 and Sirsi Municipality v. Kom Francis, [1973] 3 SCR 348 the Court rounded off the conclusion:
"On consideration of the authorities mentioned
above, it is, therefore, clear that a contract
of personal service cannot ordinarily be
specifically enforced and a court normally
would not give a declaration that the contract
subsists and the employee, even after having
been removed from service can be deemed to be
in service against the will and consent of the
employer. This rule, however, is subject to
three well recognised exceptions: (i) where a
public servant is sought to be removed from
service in contravention of the provisions of
Article 311 of the Constitution of India; (ii)
where a worker is sought to be reinstated on
being dismissed under the Industrial Law; and
(iii) where a statutory body acts in breach or
violation of the mandatory provisions of the
Statute.
This decision has been affirmed in Smt. J. Tiwari v. Smt. Jawala Devi Vidya Mandir and Ors., [1979] 4 SCC 160 and reiterated in Deepak Kumar Biswas v. The Director of Public Instructions, [1979] 4 SCC 160 and adverted to in Andi Mukta Sadguru Shree Muktajee Vandas Swami Suvaran Jayanti Mahotsav Samarak Trust and Ors. v. V.R. Rudani and Ors., [1989] 2 SCC 691 at 697. These authorities say that a college owned by a private body, though recognised by or affiliated to a Statutory University will not become a statutory body since not enacted by or under a statute. And the dismissed employee of such institution cannot get specific performance of service contract:
The submission for the respondent, however, was that the present case stands on a different footing since there was no repudiation of the respondent’s contract of service. The contract of service, according to him is still subsisting and it was, therefore, not inappropriate for the High Court to put the respondent back into service. But counsel for the appellants added that the respondent himself has abandoned his post after he was suspended and there was therefore no need to terminate his service. The declaration made by the respondent when he enrolled himself as an advocate in 1968 stating that he was not employed nor engaged in any business or profession was relied upon to support the submission. It is said that the law required that the respondent at the time enrolment must have given particulars of his employment or of his business or trade it he had one. He must have also produced a character certificate from the employer and proved as to how the employment came to an end. Since he did not furnish any such particulars counsel urged that it was a clear case of abandonment of service and no specific order of termination was necessary.
Much could be said on both the contentions, but we refrain from expressing any opinion since this is not a proper case for reinstatement. Indeed, the reinstatement would be an unwise move from any point of view. In educational institutions, the Court cannot focus only on the individual forgetting all else. The Court must have regard to varying circumstances in the academic atmosphere and radically changed position of the individual sought to be reinstated. The Court must have regard to interests of students as well as the institution. It is not unimportant to note that the respondent was out of teaching for over 25 years. He seems to have taught Chemistry for one or two years in 1962 and 1963. Thereafter, he did not teach Chemistry at any time in any College. In 1964-65 he diverted his attention and sought admission in LL.B. Degree Course. In 1968, he enrolled himself as an advocate and since then concentrated only in law courts. In this gap of twenty five years he must have clearly lost touch with Chemistry as well as art of teaching. It must have been also deeply buried and disintegrated under the new acquisition of his legal knowledge. Reinstatement of such a person seems to be unjustified and uncalled for.
The next question for consideration is whether the respondent is entitled to damages or salary as ordered by the High Court and if so what should be the measure for determination? Counsel for the appellants urged that the respondent’s claim for salary was the subject matter of previous litigation which finally ended with a decree by this Court in C.A. No. 5891 of 1983 and it was a final settlement of all his claims. It was also argued that in any event, the respondent is not entitled to damages or salary for more than three years. Our attention was drawn to the decision in Tilok chand Motichand & Ors. v. B. Munshi & Anr., [1969] 2 SCR 824.
In reply and in support of the High Court order, counsel for the respondent referred to us a number of decisions and in particular (i) Malmoona Khatun and Anr. v. State of U.P. & Anr., [1980] 3 SCR 676; (ii) Managing Director, Uttar Pradesh Warehousing Corporation and Anr. v. Vinay Narain Vajpayee, [1980] 2 SCR 773 and (iii) Maharaja Sayajirao University of Baroda and Ors. v. R.S. Thakur, AIR 1969 SC 2112.
We have read cases carefully, but it is not necessary to refer to them in detail when we have guidance from binding precedents in similar cases. There is a triology of cases on the question, See: (i) The Vaish Degree College, (ii) Smt. J. Tiwari and (iii) Deepak Kumar Biswas to which brief reference was made earlier. in the first of the three cases, the institution concerned was a degree college managed by a registered co-operative society. The dismissed Principal of the College filed a suit for reinstatement, inter alia, contending that the management of the college though a society registered under the cooperative societies Act was a statutory body since affiliated to the Agra University (and subsequently to Meerut University). It was contended that the Principal’s termination was in violation of statutory obligation of the society, and therefore, his reinstatement should be ordered. But that contention was not accepted and the Court said (at 74-75):
"That the plaintiff/respondent served the
institution for a short period of two years
only, i.e. from 1964 to 1966 and thereafter he
was bereft of all his powers and did not work
in the college for a single day.
(2) That if the declaration sought for or the
injunction is granted to the plaintiff/re-
spondent the result would be that he would
have to be paid his full salary with interest
and provident fund for full nine years, i.e.
from 1966 to 1975, even though he had not
worked in the institution for a single day
during this period.
(3) That consequent upon the declaration the
appellant would have to pay a very huge amount
running into a lakh of rupees or perhaps more
as a result of which the appellant and the
institution would perhaps be completely wiped
out and this would undoubtedly work serious
injustice to the appellant because it is
likely to destroy its very existence.
(4) It is true that the plaintiff/re-
spondent is not at fault,but the stark reali-
ties, hard facts and extreme hardship of the
case speak of themselves. And said:
"It appears but by virtue of the interlocutory
orders passed by this Court, the appellant has
already deposited Rs.9,000 before the High
Court which was to be withdrawn by the re-
spondent after giving security, and a further
sum of Rs.9,100 being the salary of 13 months
has also been deposited by the appellant
before the trial court under the orders of
this Court. It is also stated by Counsel for
the appellant that the appellant has deposited
Rs.3,000 more. We feel that in the circum-
stances the respondent may be permitted to
keep these amounts with him and he will not be
required to refund the same to the appellant.
The amount of deposit in the High Court, if
not withdrawn by the respondent may now be
withdrawn by him without any security and if
he has already withdrawn the amount he will be
discharged from the security. This will vindi-
cate the stand of the respondent and compen-
sate him for any hardship that may have been
caused to him by the order terminating his
services, and will also put a stamp of finali-
ty to any further litigation between the
parties."
The case of Smt. J. Tiwari seems-to be closer to the case before us. There the appellant claimed arrears of salary for six years covered by the period of suspension from 1952 till 1958. In January 1952 she filed a suit in the court of Munsif challenging her suspension which was later withdrawn by the High Court of Allahabad for trial by itself. The High Court decreed the suit holding that the order of suspension was not made by a properly constituted Committee. On 24 May 1958, her services were terminated by the management of the college with retrospective effect from the date of suspension. On 28 August 1958, she filed a suit for a declaration that she continued in the service and for setting aside the termination order. She claimed a decree in a sum of Rs.37,657.40 by way of salary. The trial court upheld her contention that the termination of service was bad and ineffective. The trial Court, however, passed a decree in her favour in the sum of Rs. 15,250 as arrears of pay for a period of 3 years from August 1, 1955 to July 31, 1958. Both the parties filed appeals before the High Court. The Division Bench of the High Court partly allowed the appeal of the management and dismissed the appeal of Smt. J. Tiwari. The High Court took the view that though the dismissal was wrongful, she was entitled to a decree of damages only and not to a declaration that she still continued to be in the service of the management. The High Court upheld the money decree passed by the trial court, but did so on the ground that the amount awarded by the trial court by way of arrears of salary could justifiably be granted to her by way of damages. This Court while affirming the decree of the High Court has, however, said as follows (at p. 162):
"The High Court has treated the claim for
three years’ arrears of salary as being pay-
able to the appellant on account of damages.
But that is not a right approach to the prob-
lem. The appellant is entitled to three years’
arrears of salary for the period of suspension
,since the order of suspension was without
jurisdiction and until May 1958 no order of
termination of her service was passed by the
Society. In addition to the arrears of three
years’ salary, the appellant would be entitled
to three months’ salary as provided for by
clause 10 of the agreement.
We would like to add that even if the appel-
lant could be held to be entitled to a decla-
ration that she continued to be in the service
of respondent 1, this is not a proper case in
which such a declaration should be granted to
her. The appellant’s claim according to her
counsel would amount to over Rs.2 lakhs. The
appellant has admitted in her evidence that
she did not make any attempt to mitigate the
damages by trying to obtain an alternative
employment during the last 20 years. The
difficulty of obtaining employment is an
argument which cannot be permitted to a person
who, on her own showing, has made no effort to
obtain any employment."
Deepak Kumar Biswas case appears to be the closest to the present case. There the appellant was a Lecturer in English in Lady Keane Girls College, Shillong. The college was governed by the statutes of the Meghalaya University and the Education Code framed by the State Government. The college was also receiving financial aid from the Government. His appointment was terminated for want of approval by the Director of Public Instruction. The trial court decreed the suit for declaration and permanent injunction. The appellate Court set aside that decree and granted monetary compensation of one year salary as damages although his removal was found to be wrongful. This Court sustained the removal but enhanced the compensation to three years’ salary following the pattern adopted in the aforesaid two cases.
What do we have here? In 1962 the respondent was appointed as a Chemistry lecturer in the scale of Rs. 175-10215. His performance was found to be unsatisfactory. In August 1964, he was placed under suspension. In January 1966, he was again suspended. Thereafter, he brought suit after suit, appeal after appeal from the lowest court to the Apex Court. He continued the litigation for about 25 years. On 17 March 1976 the management had appointed Dr. Gopendra Kumar as Chemistry Lecturer and his appointment was approved by the DIOS. On 28 October 1982 the management passed a resolution confirming his appointment w.e.f. 27 September 1975. That was also approved by the DIOS. Dr. Gopendra Kumar was not a party to any one of the earlier litigations nor to the present appeal.
The respondent knew very well that his service contract was with the private management. In 1964 itself learned Munsif while dismissing the first suit No. 422/1963 has held that his contract of employment could not specifically be enforced. He was then obliged to place his services on the market to mitigate the damages. But he did nothing of the kind. In 1968 he joined legal profession and he is still not out of it. He has not disclosed his professional income. In fairness he ought to have disclosed his income to the Court since it is in his personal knowledge. Instead, he seems to have urged before the High Court that the professional income is not relevant for consideration. The High Court while accepting the submission went a step further and observed: "that joining the legal fraternity can never be said to be employment and could not disentitle the respondent to claim his arrears of salary." Legal profession may not be considered as an employment but the income from profession or avocation if not negligible, can not be ignored while determining damages or back wages for payment. It must also be taken into consideration. In S.M. Saiyad v. Baroda Municipal Corporation, Baroda, [1984] (Supp) SCC 378 the Court gave deduction of even a small income of Rs. 150 per month earned by the worker turned advocate while awarding backwages upon reinstatement.
But we cannot accept the contention for the appellants that the sum of Rs. 10,000 decreed in favour of the respondent in Civil Appeal No. 5891 of 1983 was a final settlement of all his claims. There is no indication in the order of this Court to that effect.
In the light of all these facts and circumstances and the authorities to which we have called attention, it seems to us that it would be sufficient if the respondent is given salary for three years on account of damages.
In the result, the appeals are allowed and in reversal of the judgment of the High Court, we direct that the respondent be paid three years salary. The payment shall be treated as a final settlement of all his claims. The payment shall be made by the management and not by Government. In a case like this, the Government cannot be saddled with the liability to make payment. There is no relationship of master and servant between Government and respondent and such relationship existed only between the management and respondent. So far as statutory liability to pay salary to teachers is concerned, the Government has been paying salary to Dr. Gopendra who has since been appointed as Lecturer in the place of respondent. Therefore, the Management alone should pay the amount ordered. The payment shall be made within four weeks. In the circumstances of the case, we make no order as to costs. Y. Lal Appeals allowed.