Case: Life Insurance Corporation Of India Vs. Sunil Kumar Mukherjee &amp; Ors

1. This is a group of 15 appeals which raise a common question about the validity of the orders passed by the appellant Life Insurance Corporation of India terminating the services of its employees who are the respondents in these appeals. The facts which give rise to the present disputes between the parties in all the 15 cases are substantially similar, and so, it would be enough if we state the relevant facts in one of these cases. One of the respondents is Sunil Kumar Mukherjee. He was in the insurance line since June, 1941 and had been confirmed in his service by the Metropolitan Insurance Co. Ltd., in March, 1950. Since about 1953, he had been working as Inspector of the said Company, and since March 18, 1955, he was holding the appointment as Inspector at Barrackpore. The appellant which took over the controlled business of the Metropolitan Insurance Co. Ltd., terminated the services of Mukherjee by an order passed on October 16, 1958. The respondent then moved the Calcutta High Court under Art. 226 of the Constitution and prayed for a writ of certiorari or other appropriate writ or order quashing the said impugned order of discharge passed against him. Sinha, J. who heard the writ petition allowed the petition and directed that a writ in the nature of certiorari quashing and/or setting aside the impugned order be issued. A further writ in the nature of mandamus was also issued directing the respondents to the writ petition not to give effect to the said impugned order. To the petition filed by the respondent, he had impleaded eight. respondents, the principal amongst them being the appellant Corporation and the Union of India.2. Aggrieved by the decision of Sinha, J. the appellants preferred an appeal under the Letters Patent before a Division Bench of the said High Court. Bose, C. J. and Debabrata Mukerjee J., who heard the Letters Patent appeal substantially agreed with the view taken by Sinha, J. and confirmed the order passed by him. The appellants then applied for and obtained a certificate of fitness from the said High Court and it is with the said certificate that they have come to this Court in appeal. On similar facts, the appellants have brought to this Court the other further appeals, and a common question which has been raised by the learned Solicitor-General on behalf of the appellants is that the High Court was in error in holding that the orders of discharge passed respectively against the respondents in these appeals were invalid.Before dealing with the points raised by the appellants in the present appeals, it would be convenient to set out the relevant orders passed in respect of the appointment and discharge of the respondent Mr. Mukherjee. When Mr. Mukherjee was appointed a wholetime Inspector by the Metropolitan Insurance co. Ltd. on the 18th or 19th March, 1955, the terms and conditions of his employment were communicated to him by a document which contained 14 clauses (Annexure A to the W. P.).

Court's reasoning:
It is thus clear that under the terms and conditions of Mr. Mukherjees original appointment with the Insurance Co., he was liable to be dismissed for misconduct and was entitled to receive 30 days notice if his services were terminated for reason other than misconduct.It is thus clear that in regard to the Field Officers subsequently designated as Development Officers who became the employees of the Corporation after the appointed day, the Order provides a self-contained code in dealing with the material terms and conditions of service of the said Officers. In regard to the scales of pay and allowances which have been prescribed by Cl. 5, Cl. 11 contemplates that the actual pay and allowances admissible to any Development Officer will have to be determined in accordance with the principles which the relevant regulation would in that behalf lay down, and so, in the matter of scales of pay and allowances Cl. 5 read with Cl.11 has to be co-related with the relevant regulation which had to be subsequently framed. In regard to the other terms and conditions of service, however, the Order makes specific and clear provisions. That being so, there can be no doubt that in regard to the Officers to whom the Order applies, if any action is intended to be taken for the termination of their services, it has to be taken under Cl. 10 (a) or (b). Clause 10(a) deals with two alternatives; it empowers the appropriate authority to reduce the remuneration of the Development Officer or to terminate his services; in either case, an opportunity of showing cause against the action proposed to be taken has to be given to him, and an enquiry has to be conducted in the manner which the Corporation may think fit. If the Development Officer shows negligence in his work, or is guilty of misconduct, or is otherwise incapable of discharging his duties satisfactorily, the Corporation may reduce his remuneration or may terminate his service; but that can be done only after complying with the conditions prescribed by Cl. 10(a).It is true that in the present proceedings the respondents had claimed relief under Art. 311 (2) of the Constitution and had in their writ petitions challenged the validity of the Order and the Regulations. That, however, does not disentitle the respondents from claiming the same relief on the alternative basis that though the Order and the Regulations may be valid, the impugned orders whereby their services have been terminated are invalid for the reason that they do not comply with Cl. 10 of the Order. Therefore, we are satisfied that the learned Solicitor-General is not justified in contending that the impugned orders can be sustained under paragraph 4(h) of the Circular which has been adopted by the Regulations as annexure thereto.20. There is one more point which has yet to be examined. In regard to the case of Haridas Roy who is the respondent in C. A. No. 917 of 1963, the learned Solicitor-General has contended that the order terminating his services is valid either under para. 4(h) of the circular or under S. 11 (2) of the Act. Haridas Roy was originally employed by the Hindustan Co-operative Insurance Society Ltd., before the appointed day as an Inspector of Agents. After the Corporation took over the controlled business of the said Insurance Co., he was appointed as a Field Officer under the Order, and the order of his appointment was communicated to him on February 15, 1958. It appears that on August 9, 1958, he was told that his case had been considered by the Zonal Committee and it had been decided to absorb him in the office as an Assistant on the emoluments mentioned in the order. Haridas Roy declined to accept this assignment and stated that he wanted to continue as a Field Officer as before. Thereupon, his services were terminated by an order dated September 18, 1958. In this letter, Roy was told that his case had been carefully considered by the Zonal Committee and he was offered ex-gratia to be absorbed on the administrative side as an Assistant; since he refused to accept that assignment, his services were terminated on payment of one months salary in lieu of notice less deductions, if any. This letter also told Roy that there were no extenuating circumstances in his case and his work was found to be of very poor quality. It would be noticed that the Corporation presumably examined the performance of Roy in the light of the principles laid down by the relevant provisions in the circular and held that his case fell under the last part of paragraph 4(h) of the said circular. That only means that having regard to his poor performance Roy became eligible to be dealt with under Cl. 10 of the Order. It was not open to the Corporation to require Roy to accept an assignment in a lower or different category. What the regulations authorised to do is merely to determine his salary in the category of Development Officers, and so, we do not see how the order terminating his services because he refused to take an assignment as an Assistant can be justified. It would have been open to the Corporation to fix Roys salary at the minimum in the grade prescribed by Cl. 5 of the Order and if he had refused to take it, an occasion may have arisen for the operation of S. 11 (2) of the Act. Therefore, we are satisfied that the case of Roy cannot be distinguished from the cases of other respondents in the present group of appeals.