IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED:10.02.2010 CORAM: THE HON’BLE MR. JUSTICE T.S.SIVAGNANAM W.P.No.26640/2009 & M.P.No.1/2009 & M.P.No.3/2010 C.Duraikannu ... Petitioner -vs- 1.Neyveli Lignite Corporation, Rep. by its Chairman cum Managing Director, Neyveli – 1. 2.Director (Personal), Neyveli Lignite Corporation Ltd., Neyveli. 3.The General Manager (P&A), NLC Ltd., Corporate Officer, Personal and Administration Department, Neyveli. 4.The General Manager, Thermal Power Station-I, NLC Ltd., Neyveli. ... Respondents Prayer: The Writ Petition filed under Article 226 of the Constitution of India for issue of Writ of Certiorari to call for the pertaining to the orders dated 02.12.2009 in letter No.O.O.No.CORP/P&A/ 502/355/2009-169 issued by the 3rd respondent transferring the petitioner from Neyveli to Thoothukudi and the order dated 10.12.2009 in Lr.No.GM/TPS-I/P&A/DA/2009 issued by the 4th respondent, quash the same For Petitioner :Mr.N.G.R.Prasad Senior Counsel for Mr.R.Krishnaswamy For Respondents :Mr.N.A.K.Sarma for RR3 & 4 O R D E R By consent the Writ Petition itself is taken up for disposal. The challenge is to an order of transfer dated 02.12.2009 https://hcservices.ecourts.gov.in/hcservices/ transferring the petitioner from Neyveli to Thoothukudi and the consequential order dated 10.12.2009 by which the petitioner's request for extension of time for joining the post was declined. 2. The petitioner is employed as the Chief Engineer (Civil) in the first respondent Corporation (hereinafter referred to "as NLC") and he was promoted to the said post on 01.08.2007. According to the petitioner he was a public spirited person and was engaged in various activities, which according to the petitioner was in the interest of NLC and ultimately in public interest. While so the third respondent issued the impugned order transferring the petitioner to Thoothukudi. The correctness of the impugned orders are assailed, stating that the 3rd and 4th respondents are incompetent to pass the impugned orders and the competent authority is only the Director(Personal), the second respondent. It has been further contended that the petitioner fought against the corruption in making appointments of SC/ST candidates and therefore the order is malafide and illegal. It was further contended that other two officers, who were also transferred under the same order were transferred on their own willingness. It is further submitted that on account of the petitioner's communal status discriminatory treatment has been meted out to him, since people belonging to other community in the same cadre are available and not transferred. 3. This Court by order dated 21.12.2009 ordered notice of motion to the respondents and also granted the interim order for a limited period, which order was subsequently extended till the matter was heard by this Court. During the pendency of the writ petition, the petitioner filed two miscellaneous petition in M.P.Nos.1&2/2010, seeking permission to raise additional grounds and file additional affidavit. These petitions were ordered by this Court on 03.02.2010. The additional ground of challenge is that, NLC Tamil Nadu Power Limited (NTPL) to which the petitioner had been transferred, which is at Thoothukudi, is a separate, independent and different company and the respondents cannot transfer the petitioner to a new 3rd party company and to a different management/establishment without the petitioner's consent and willingness and as the respondents have not obtained consent and willingness from the petitioner before issuing the impugned order, the same is illegal. 4. Mr.N.G.R.Prasad, learned counsel appearing for the petitioner would contend that if the impugned order is given effect to it would amount to transferring the petitioner to a new establishment and a new employer and the NTPL is a joint venture company with the Tamil Nadu Electricity Board and as per the Memorandum of Articles of Association of the company as amended upto 30.10.2007, the NLC holds only 50% of the shares in NTPL and therefore it cannot be a subsidiary of NLC and for being the subsidiary the holding should be a minimum of 51%. https://hcservices.ecourts.gov.in/hcservices/ 5. Next, it is contended that if transfer is stated to be an incidence of service, it can be only within the organisation and not outside the organisation and the petitioner cannot be transferred outside the company without the consent of the petitioner. The learned counsel placed reliance on the decision of the Hon'ble Supreme Court in M/s.Kundan Sugar Mills Vs. Ziyauddin and others, AIR 1960 SC 650, Jawaharlal Nehru University Vs. Dr.K.S.Jawatkar and Others 1989 Supp (1) SCC 679, and BCPP Mazdoor Sangh and another Vs. N.T.P.C and others, 2008 1 LLN page 1 in support of his contentions. 6. Mr.N.A.K.Sarma, learned counsel appearing for the NLC by relying upon the counter affidavit would contend that transfer is an incidence of service and more particularly when the petitioner is working as Chief Manager (Civil) in the Thermal Power Station – I at Neyveli and in the pay scale of Rs.36600-62000 and his present basic pay is Rs.58,500 and is drawing a monthly gross salary of Rs.79,852 and such Chief Manager holding a Middle Management Level Post is not entitled to avoid transfer on specious and imaginary grounds. Learned counsel would further submit that NTPL is a subsidiary of NLC, the Memorandum and Article of Association relied on by the petitioner is of the year of 2007 and the correct position being NLC has 89% equity participation in NTPL and TNEB has balance of 11% and NTPL project is in the process of implementation and suitable and experienced personnel in different disciplines in different grades are being transferred to Thoothukudi and during the end of November 2009, over 30 Executives have been transferred who have all joined NTPL and the seniority and the promotional avenues of the transferred employees do not undergo any alteration and are maintained as such in NLC. 7. The learned counsel appearing for the respondents placed reliance on the following decisions in support of his contentions Government of Andhra Pradesh Vs. G.Venkata Ratnam (2008) 9 SCC 345, State of U.P. and others Vs. Gobardhan Lal, 2004 11 SCC 402, S.C.Saxena Vs. Union of India and Others (2006) 9 SCC 583, Mohd. Masood Ahmad Vs. State of U.P. and others, JT 2007 (11) SC 540 and unreported Judgment of the Hon'ble First Bench of this Court in W.A.No.282/2009 dated 18.03.2009 and the subsequent order passed by the Hon'ble First Bench dated 30.04.2009 in review application No.37/2009 in W.A.No.282/2009. The learned counsel for the respondents further placed the annual report of the NLC – 2008-2009 and in the statement made under Section 212 of the Companies Act, it has been noted that NTPL is a subsidiary of the NLC and it became a subsidiary on 26.05.2008. 8. The learned counsel appearing for the respondents would further submit that the order of promotion given to the petitioner on 06.08.2007, clearly states that the petitioner was liable to be transferred to any Establishment/Department/Unit (or) Subsidiaries / Undertaking of the Corporation situated anywhere in India. The learned counsel for the respondents would submit that the petitioner https://hcservices.ecourts.gov.in/hcservices/ cannot resist the order of transfer. It is further contended that in sofar as the project at Rajasthan, it was established by the NLC during 2000 and so far 215 Executives have been transferred from Neyveli to Rajasthan. The other allegations made by the petitioner pertaining to the actions stated to have been initiated by him for certain stated reasons have been denied. These allegations, denial and counter allegations are not gone into in the present case, since the validity of the impugned order of transfer is tested only on the legal grounds raised. 9. I have carefully considered the submissions on either side and perused the materials available on record. 10. Admittedly, the petitioner is a Middle Management Level Officer working as Chief Manager (Civil) in Thermal Power Station – I NLC and drawing a substantially good monthly gross salary of Rs.79,852/-. The Hon'ble First Bench of this Court considered the validity of an order of transfer of an Additional Chief Manager of NLC drawing a salary of over Rs.40,000/-, when he was transferred to Rajasthan. The Hon'ble First Bench by order dated 18.03.2009, while dismissing the appeal held as follows:- "4. We have heard both the parties. We are inclined to accept the submission made on behalf of the respondents. It is well known that transfer is an incidence of service and highly placed officers like the appellant herein cannot refuse to proceed to the station where they have been transferred." 11. The review petition filed against the such order was in review application No.37/2009 came to be dismissed by order dated 30.04.2009. Thus the view taken by the Hon'ble First Bench is that transfer is an incidence of service and highly placed officer like that of the appellant therein cannot refuse to proceed on transfer. 12. Mr.N.G.R.Prasad, learned counsel appearing for the petitioner would contend that the transfer could be an incidence of service, if it is within the organisation and if it is outside the organisation, it cannot be done without the consent of the employee. Therefore, it has become necessary to examine the aspect as to whether the petitioner has been transferred within the organisation or outside the organisation. The order of promotion dated 06.08.2007 empowers NLC to transfer the petitioner to any Establishment/Department/Unit (or) Subsidiaries /Undertaking of the Corporation situated anywhere in India. The point which has been raised by the learned counsel for the petitioner is that NTPL is not a subsidiary of NLC, since as per the Memorandum and Articles of Association 2007 NLC holds only 50% of the equity and the minimum requirement for being a subsidiary is 51% and therefore NTPL is not a subsidiary of NLC. Learned counsel by placing reliance on the case https://hcservices.ecourts.gov.in/hcservices/ of Kundan Sugar Mills, referred supra, would contend that the Hon'ble Supreme Court held as follows:- "4.......... In the instant case, as we have indicated, the two factories are distinct entities, situated at different places and, to import a term conferring a right on the employer to transfer respondents 1 to 4 to a different concern is really to make a new contract between them." 13. Further the learned counsel would rely on the decision in the case of Jawaharlal Nehru University, referred supra, wherein the Hon'ble Supreme Court held that : "7........ The position in law is clear, that no employee can be transferred, without his consent, from one employer to another. The consent may be express or implied. We do not find it necessary to refer to any case law in support of this conclusion." 14. It is to noted that in the counter affidavit, it has been specifically stated that the NLC has 89% equity participation in NTPL and it is a subsidiary of NLC. In support of the said averments, the 53rd annual report 2008-2009 of NLC has been produced and in page 73 of the said report, it is seen from the statement pursuant to Section 212 of the Companies Act 1956, that NTPL has become a subsidiary of NLC on 26.05.2008. Therefore, it is clear that the contention raised by the petitioner stating that NTPL is not a subsidiary of NLC is factually incorrect. 15. Having been faced with such factual material, the learned counsel appearing for the petitioner would alternatively submit that the petitioner was promoted on 06.08.2007 and as on such date NTPL was not a subsidiary of NLC as it had become a subsidiary only on 26.05.2008 and therefore the petitioner cannot be transferred to NTPL without his consent. 16. Therefore, the submission of the petitioner is that the conditions of service and the position of the Rules or Regulations cannot be altered and such regulations have to remain unaltered as on the date when the petitioner joined service. On this aspect, it would be relevant to note the decision of the Hon'ble Supreme Court in P.U.Joshi Vs. Accountant General, (2003) 2 SCC 632, wherein the Hon'ble Supreme Court held that there is no right in any employee of the State to claim that rules governing conditions of his service should be forever the same as the one when they entered service for all purposes and except for ensuring or safeguarding rights or benefits already earned, acquired or accrued at a particular point of time, a government servant has no right to challenge the authority of the State of amend, alter and bring into force new rules relating to even an existing service. https://hcservices.ecourts.gov.in/hcservices/ 17. Therefore, I am unable to accept the contention raised by the learned counsel appearing for the petitioner that the Rules of the organisation should remains static. In view of the above reasoning, it has to be necessarily concluded that the NTPL is a subsidiary of NLC and therefore the ground raised by the petitioner that he has been transferred to a different organisation is not well founded. Therefore, the Judgments relied on by the learned counsel for the petitioner does not advance the case of the petitioner, since factually in the present case the order of promotion specifically stated that the petitioner was liable for transfer to the subsidiaries of NLC. 18. Next, it has been contended that the impugned order of transfer is on account of malafide exercise of power and discriminatory treatment meted out to the petitioner. In the affidavit filed in support of the writ petition though the words "malafide" has been used in more than one place, no specific allegations of malafides have been made relatable to the impugned order of transfer and no specific officer or authority has been named for such transfer and no such person has been impleaded in his personal capacity. The Hon'ble Supreme Court in 2005 SCC 630, Prabodh Sagar Vs. Punjab State Electricity Board and other held that mere use of the word malafide by the petitioner would not by itself make the petition entertainable. The Hon'ble Supreme Court in Purushottam Kumar Jha Vs. State of Jharkhand and others - (2006) 9 SCC 458 on the same issue, held as follows:- "23. It is well settled that whenever allegations as to mala fides have been levelled, sufficient particulars and cogent materials making out prima facie case must be set out in the pleadings. Vague allegation or bald assertion that the action taken was mala fide and malicious is not enough. In the absence of material particulars, the court is not expected to make "fishing" inquiry into the matter. It is equally well established and needs no authority that the burden of proving mala fides is on the person making the allegations and such burden is "very heavy". Malice cannot be inferred or assumed. It has to be remembered that such a charge can easily be "made than made out" and hence it is necessary for the courts to examine it with extreme care, caution and circumspection. It has been rightly described as "the last refuge of a losing litigant". (Vide Gulam Mustafa Vs. State of Maharashtra; Ajit Kumar Nag. V. GM(PJ), Indian Oil Corpn. Ltd. (2005) 7 SCC 764". Therefore, I am unable to accept the contention raised on behalf of the petitioner that the impugned order of transfer is on account of malafide exercise of power. https://hcservices.ecourts.gov.in/hcservices/ 19. Having held that the NTPL is a subsidiary of NLC and that the petitioner cannot state that since it become a subsidiary after his order of promotion, the same would not have any effect, which contention is untenable, and it has to be held that the transfer in the instant case is an incidence of service. As rightly pointed out by the learned counsel appearing for the respondents in S.C.Saxena Vs. Union of India and Others (2006) 9 SCC 583, Mohd. Masood Ahmad Vs. State of U.P. and others, JT 2007 (11) SC 540, the petitioner is not justified in resisting the order of transfer. 20. For the above reasons, I find no valid grounds to interfere with the order of transfer and accordingly the writ petition fails and it is dismissed. Consequently, connected miscellaneous petitions are also closed. No costs. Sd/ Asst.Registrar /true copy/ Sub Asst.Registrar pbn To 1. The Chairman cum Managing Director, Neyveli Lignite Corporation, Neyveli – 1. 2. The Director (Personal), Neyveli Lignite Corporation Ltd., Neyveli. 3. The General Manager (P&A), NLC Ltd., Corporate Officer, Personal and Administration Department, Neyveli. 4. The General Manager, Thermal Power Station-I, NLC Ltd., Neyveli. 1 cc To Mr.V.Ajay Khose, Advocate, SR.8402 1 cc To Mr.N.A.K.Sarma, Advocate, SR.8365 W.P.No.26640/2009 AR(CO) sra 11.02.2010 https://hcservices.ecourts.gov.in/hcservices/