Janah, J.@mdashThis is an appeal under Clause 15 of the Letters Patent from a judgment passed by S.K. Datta J. in S.A. No. 291 of 1971 on
February 2, 1973. The facts giving rise to this appeal are briefly as follows:
The respondent instituted a suit against the appellants alleging that he had been working under the appellant Corporation for several years
temporarily in place of bearers absent on leave. He was appointed in the permanent post of Vendor-cum-Cleaner-cum-Plate-washer by the
appellant Corporation from 1.2.68. The respondent automatically became permanent in his post from 1.8.68 on completion of 6 months''
continuous service. The second appellant by a verbal order dispensed with the service of the respondent on 12.11.68 without assigning any reason
or holding any enquiry. On this allegation the respondent instituted the suit for declaration that the verbal order of termination of the respondent''s
service was illegal, void, inoperative and ultra vires, that the respondent was and continued to be in the permanent service of the appellant
Corporation and he was entitled to salary and damages. He also prayed for an injunction restraining the appellant Corporation from issuing any
written order of dismissal without following the legal procedure.
The suit was contested by the appellants by filing a joint written statement. The defence taken was that the respondent was merely a casual
labourer and he was paid on hourly basis. It was alleged that being a casual labourer the respondent could not claim any right of enquiry or
observance of legal procedure in the matter of termination of his employment since the respondent held the job at the pleasure of the appellants. It
was alleged that casual labourers are not appointed in writing and their services are liable to be dispensed with by verbal order. It was further
alleged that in order to absorb the respondent in a permanent vacancy the appellants offered him the post of lamp-lighter but the plaintiff refused to
accept the same and by his refusal the plaintiff forfeited the right to be absorbed in the permanent post and he remained as Casual labour. On this
ground it was alleged that the plaintiff was not entitled to any relief in the suit filed by him.
2. The trial court found that the respondent was a temporary workman under the appellant Corporation. It also found that there were breaks in
service of the respondent and he did not render continuous service for a period of 6 months during the period from 1.2.68 to 11.11.68 and
therefore the respondent was not entitled to get 7 days'' notice as provided for in the standing orders. The trial court further found that the
respondent was offered the post of lamplighter by the appellants before his dismissal from service but the respondent refused to accept such offer.
The trial court held that the verbal order of dismissal of the respondent was legal and valid and it also held that the suit filed by the respondent was
not maintainable. On these findings the trial court dismissed the suit. On appeal by the respondent the Lower Appellate Court affirmed the finding
of the trial court that the respondent was a temporary workman in the employment of the appellant Corporation during the period from 1.2.68 to
12.11.68. But the Lower Appellate Court disagreed with the finding of the trial court on the question as to whether there was intermittent breaks in
service of the respondent and held that the respondent worked as a temporary Vendor-cum-Cleaner-cum Plate-washer for more than 6 months at
a stretch during the relevant period. The Lower Appellate Court took the view that the appellant Corporation could not dispense with the service
of the respondent who was a temporary workman having worked continuously for more than 6 months without giving him one week''s notice or
without holding an enquiry before dispersing with his service, in view of the Standing Order No. 13 (b) of the Standing Orders of the appellant
Corporation which provides that the services of a temporary workman who has worked continuously for 6 months can be dispensed with after
giving him a week''s notice. The Lower Appellate Court was of the view that the termination of service of the respondent was in breach of the
Standing Orders and as such it was in breach of a Statutory obligation which prevented the termination of service of the respondent except in the
manner prescribed by the Standing Orders. Upon this view the Lower Appellate Court allowed the appeal and decreed the suit and passed the
declaration in favour of the respondent that the order of dismissal was illegal and void and that he continued to remain in the employment of the
appellant Corporation.
3. Against the decision of the Lower Appellate Court the present appellants filed a Second Appeal in this Court, namely S.A. No. 291 of 1971.
The said appeal came up for hearing before S.K. Datta, J., and his Lordship affirmed the judgment and decree passed by the Lower Appellate
Court and dismissed the Second Appeal. His Lordship took the view that the Standing Orders on being duly certified became the statutory terms
and conditions of service. Therefore, when there was a breach of any provision of the Standing Orders the aggrieved party had the legal right to
challenge such order as being null and void and to obtain a decree declaring its statutory invalidity. His Lordship also took the view that a case for
declaration of a statutory invalidity of an act of dismissal of an employee is wholly different from the enforcement of contrast of personal service.
Upon this view his Lordship dismissed the appeal.
4. Mr. Ginwalla appearing for the appellants has contended before us that a declaration as sought for in the present case can only be granted in a
case where the employer, by its constitution, can only act in a particular way in terminating the employment of his employee. He has contended that
in no other case such a declaration can be granted because that would amount to granting a decree for specific performance of a contract for
personal service which is clearly barred by Section 14(b) of the Specific Relief Act, 1963, which corresponds to Section 21(b) of the Specific
Relief Act, 1877. Mr. Ginwalla has argued that a breach of statutory provision does not make an act invalid or a nullity. It was argued that in such
a case the act may be wrongful illegal and the remedy of the aggrieved party would lie in an action for damages. It is further argued that it is only
the breach of a provision of a statute which is a part of the constitution of that particular body, which would make such an act invalid. Reliance was
placed by Mr. Ginwalla on the decision of the Supreme Court in (4) Executive Committee, U.P. Warehousing Corporation Vs. Chandra Kiran
Tyagi, , for the proposition that ordinarily a declaration to enforce a contract of personal service will not be granted. The only exceptions to this
rule are: (1) where a public servant who has been dismissed from service in contravention of Article 311 of the Constitution, (2) reinstatement of a
dismissed worker under Industrial Law or by Labour or Industrial Tribunal and (3) a statutory body when it has acted in breach of a mandatory
obligation imposed by statute. The question for decision before the Supreme Court in that case was whether certain Rules and Regulations framed
under the Agricultural Produce (Development and Warehousing) Corporations Act, 1956 had statutory force and whether a violation of such
Regulations would entitle the employee of the Corporation to a declaration that his dismissal from service was null and void and he was entitled to
be reinstated with full pay and other emoluments. Their Lordships reviewed a number of English decisions as well as decisions of the Supreme
Court and came to conclusion that the Regulations were made under the power reserved to the Corporation u/s 54 of the Act and these
Regulations lay down the terms and conditions of relationship between the Corporation and its employees. The order made in breach of
Regulations would be contrary to such terms and conditions but would not be in breach of any statutory obligation. Their Lordships further held
that a violation of regulation 16(3) as was alleged in that case, can only result in the ordered dismissal being held to be wrongful and, in
consequence, making the appellant liable for damages. In corning to the conclusion their Lordships at page 1251 of the report observed as follows:
The law relating to master and servant is clear. A contract for personal service will not be enforced by an order for specific performance nor will it
be open for a servant to refuse to accept the repudiation of a contract of service by his master and say that the contract has never been terminated.
The remedy of the employee is a claim for damages for wrongful dismissal or for breach of contract. This is the normal rule and that was applied in
Barbar''s case, 1958 (1) All. E.R. 322 and Fraud''s case, 1962 (3) All. E.R. 633. But when a statutory status is given to an employee and there
has been a violation of the provisions of the statute while terminating the services of such an employee, the latter will be eligible to get relief of a
declaration that the order is null and void and that he continues to be in service, as it will not then be a mere case of a master terminating the
services of a servant. This was the position in Vine''s case, 1956 (3) All. E.R. 939.
5. The next case relied upon by Mr. Ginwalla in support of his contention is (5) Indian Airlines Corporation v. Sukdeo Rai, AIR 1971 S.C. 1823.
In that case the respondent who was an employee under the Indian Airlines Corporation was dismissed on being found guilty of certain charges
after an enquiry was held by the Corporation. The respondent in that case thereafter filed a suit for a declaration that his dismissal was in breach of
the procedure laid down by the Regulations made by the Corporation and, therefore, the dismissal was illegal and void. It was held by the
Supreme Court that though the Corporation''s employee is dismissed in contravention of Regulations made by it under the Airlines Corporation Act
(1953), the dismissal cannot be declared as null and void as the Act did not cast any obligation upon indian Airlines Corporation to appoint
employees under particular type of contract or to terminate them on specific grounds. In dealing with this aspect of the case their Lordships at page
1834 of the report observed:--
The regulations contain the terms and conditions which govern the relationship between the Corporation and its employee. Though made under the
power conferred by the statute, they merely embody the terms and conditions of service in the Corporation but do not constitute a statutory
restriction as to the kind of contracts which the Corporation can make with its servants or the grounds on which it can terminate them. That being
so, and the Corporation having undoubtedly the power to dismiss its employees, the dismissal of the respondent was within jurisdiction, and
although it was wrongful in the sense of its being in breach of the terms and conditions which governed the relationship between the Corporation
and the respondent it did subsist. The present case, therefore, did not fall under any of the three well recognized exceptions, and, therefore, the
respondent was only entitled to damages and not to the declaration that his dismissal was null and void.
6. Reliance was also placed on behalf of the appellants on a decision of the Supreme Court in Co-operative Central Bank Ltd. and Others Vs.
Additional Industrial Tribunal and Others, . In that case the Supreme Court was considering the effect of bye-laws of a Co-operative Society
framed in pursuance of the provisions of the Act. The contention was advanced on behalf of the appellants in that case that the bye-law which
contain the conditions of services were themselves laws so that any direction made by an Industrial Tribunal altering a condition of service would
be an order contrary to law and therefore illegal. Their Lordships held that the bye-laws framed by a co-operative society in pursuance of the
provisions of the Act can not be held to be law or to have the force of law. Their Lordships observed that the bye-laws that can be framed by the
society under the act are similar in nature to the Articles of Association of a Corporation incorporated under the Companies Act.
7. The next case cited before us is (10) Workmen of Motipur Sugar Factory (Private) Limited Vs. Motipur Sugar Factory, . That case arose cut
of a reference u/s 10 of the Industrial Disputes Act, 1947. The question referred to the Tribunal was whether the discharge of some workmen was
justified. It appeared that the employer had failed to make an enquiry before dismissing the workmen. The Supreme Court held that the scope of
the reference was wide enough to entitle the tribunal to investigate the reason for discharge and the entire matter would be open before the tribunal
and it will have jurisdiction not only to go into limited questions open to a Tribunal where the domestic enquiry has been properly held, but also to
satisfy itself on the facts adduced before it by the employer whether the dismissal or discharged was justified. On the basis of this decision it was
argued that if the effect of failure to hold an enquiry before dismissing the employee was to render the order of dismissal void in law, there would
be no point in the tribunal deciding for itself on the evidence adduced before it whether charges have been really made out or not. It was argued
that this indicate that the act of dismissal in such a case was not void but was a mere irregularity.
8. Counsel for the appellant also relied upon the decision in J. Molby D''Cruz and others v. The Chief Administrative Officer Travancore Minerals
Ltd. and others, AIR 1968 Kerala 121, in support of his contention than an order of dismissal without following the provisions of the Standing
Orders may be wrongful, and illegal, giving rise to a cause of action for damages for breach of contract or for wrongful dismissal, but it cannot be
said the person wrongfully dismissed must still be deemed to be in service so that he continues to earn wages notwithstanding the termination of his
employment.
9. Mr. Banerjee appearing on behalf of the respondent has contended that an organisation or a body which has statutory duties to perform, is a
statutory body to the extent of that statute or for the purpose of that statute. Alternatively, he has argued that even if such an organisation or body
is not a statutory body but if it has some statutory obligations to perform, the nonperformance of these obligations will render its act void, and such
an act would therefore be a nullity. In other words Mr. Banerjee contends that by the Standing orders the appellants were required to act in a
particular manner before terminating the service of the respondent, but the appellants not having followed the procedure laid down by the standing
Orders then act is a nullity, and the court, under such circumstances, is entitled to make a declaration treating the impugned order as such. In
support of his contention Mr. Banerjee has relied upon the decision in (7) The State of Bombay and Others Vs. The Hospital Mazdoor Sabha and
Others, where it has been held that non-compliance with the requirement prescribed u/s 25F (b) of the Industrial Dispute Act, 1947 renders the
retrenchment invalid and in-operative. Reliance was also placed by Mr. Banerjee in support of his contention upon the decision in (12) Western
India Match Company Ltd. Vs. Workmen, ; (11) Workmen of Dewan Tea Estate and Others Vs. The Management, ; (1) The Bagalkot Cement
Co. Ltd. Vs. R.K. Pathan and Others, ; (8) Tata Chemical Ltd. and Ors. v. Kailash C. Adhvaryu, AIR 1964 Gujrat 265; (6) Sirsi Municipality by
its President Sirsi Vs. Cecelia Kom Francis Tellis, ; Executive Committee of U.P. state Warehousing Corporation v. Chandra Khan Tyagi, 1970
S.C. 1244; (12) The Western India Match Co. Ltd. v. Rameswar Prosad (1971) 2 Lab. I.C. 1447 and (2) Bihar State Road Transport
Corporation Vs. State of Bihar and Others, . We shall have occasion to deal with these decision later in this judgment.
10. The point for consideration in the present appeal is whether the Standing Orders framed under the Industrial Employment (Standing Order)
Act, 1946 have statutory force, and secondly, even if those have statutory force whether an order of termination of service in violation of the
provisions of the Standing Orders would make the order a nullity so as to entitle a civil court to make a declaration that inspite of the termination of
service the employee still remains in service of his employer. Generally a contract of personal service is not enforceable by specific performance
and the employee cannot be heard to say that inspite of the termination of his service he is still in employment. If his service has been wrongfully
terminated in breach of the contract for service, his remedy will lie in damages. It is only in certain exceptional cases that a civil court or a tribunal is
entitled to make a declaration that inspite of the termination of service the employee concerned will remain in the employment of his employer.
These exceptions, as has been laid down by the supreme Court, are (1) a public servant who has been dismissed from service in contravention of
Article 311, (2) reinstatement of a dismissed worker under Industrial Law or Labour or Industrial Tribunal and (3) a statutory body when it has
acted in breach of a mandatory obligation imposed by statute. But it is not every breach of a statutory provision that will entitle the employee to ask
for such a declaration. It is only when a statutory status in given to an employee and there has been a violation of the provision of a statute while
terminating the service of such an employee the latter will be entitled to get a declaration that the order is null and void and that he continues to be
in service, as it will not; be a mere case of a master terminating the service of a servant. In (9) Vine v. National Dock Labour Board, 1956 (3) All.
E.R. 939, the House of Lords upheld the order of the trial court which granted a declaration that the order of dismissal of the appellant in that case
was illegal, ultra vires and invalid on the ground that the removal of the appellant''s name from the register was in law a nullity and he continued to
have the right to be treated as a registered dock worker. It was because of the status conferred by the statute upon the appellant in that case that
such a declaration was granted as it was held that the disciplinary committee had no power to terminate the employment of Mr. Vine. In the said
decision the House of Lords emphasized that the order directing the removal of the plaintiff''s name from the register was not considered simply as
a case of a master terminating the service of a servant, but it was treated as one effecting the status of the plaintiff of that case. The House of Lords
observed in that case as follows:--
This is not the straightforward relationship of master and servant. Normally, and apart from the intervention of statute there would never be a nullity
in terminating an ordinary contract of master and servant. Dismissal might be in breach of contract and so unlawful but could only sound in
damages. Here we are concerned with a statutory scheme of employment...The scheme gives a dock worker a status. Unless registered, he is
deprived of the opportunity of carrying on what may have been his lifelong employment as a dock worker, and he has a right and interest to
challenge any unlawful act that interferes with this, status. If the actings here complained of were a nullity Mr. Vine (hereinafter called the Plaintiff) in
my opinion, has a clear right to have that fact declared by the court.
11. It is clear, therefore, that it is because of the status conferred by the statute on a person that such a declaration was granted in his favour, and
that case was not treated as an ordinary case of master and servant. To the same effect is the decision of the Supreme Court in the case of U.P.
State Warehousing Corporation referred to hereinbefore.
12. In the present case however no statutory status was conferred upon the respondent. The effect of the Standing Orders is to incorporate certain
provisions in the contract of service between the appellant and the respondent, but the contract still remains a contract of service. For instance, if a
workman is dismissed for misconduct in breach of a provision contained in the Standing Orders and if the matter comes up before the tribunal
under the Industrial Dispute Act, 1947, the tribunal has to see whether there is, in fact, any misconduct or not. If the tribunal finds that the
misconduct alleged has been proved it will uphold the order of dismissal notwithstanding the fact that the provisions of the standing Orders were
not complied with. The nonobservence of the provisions of the Standing Orders with regard to dismissal of an employee, therefore, does not make
the order of dismissal a nullity although it may be wrongful or illegal.
13. The decision reported in (State of Bombay v. Hospital Mazdur Sabha AIR 1960 B.C. 610 which was relied on by counsel for the respondent
is quite distinguishable. There the order of retrenchment was passed without complying with the provisions of section 25F (b) of the Industrial
Dispute Act, 1947. That is a statutory provision. But the standing Orders cannot be said to be statutory provision in that sense, although those
might have been framed under a statute. The effect of the standing Orders is to incorporate certain terms and conditions in the conditions of
service. But the terms and conditions nonetheless remain the terms and conditions of service between the master and servant.
14. The next decision relied upon by Mr. Banerjee in support of his contention reported in Western India Match Company Ltd. Vs. Workmen, is
also of no assistance to Mr. Banerjee. That case arose out of an Industrial Dispute in connection with the discharge of an employee on the ground
that it was in contravention of the standing Orders. It was held in that case that the employer could not enter into the agreement with the workmen
which is inconsistent with the standing Orders of the company. The terms of the standing Orders would prevail over the corresponding terms in the
contract of service and while the standing Orders are in force it is not permissible for the employer to seek their statutory modification so that there
can be one set of standing orders in respect of certain employees and another for the rest. The decision in that case, therefore, has nothing to do
with the question involved in the present case. The decision reported in Workmen of Dewan Tea Estate and Others Vs. The Management, which
was relied upon by Mr. Banerjee is also of no assistance to him in the present case. The question considered in that case was that the standing
orders or a company having been certified before the defination of Lay-off was introduced in the Act by an amendment; whether the management
was entitled to rely upon the said defination in support of the plea that the impugned lay-off was justified. The Supreme Court held that the
management could not be allowed to contend that as the amended section 2 (kkk) of the Industrial Dispute Act, 1947 is wider than the relevant
rule of the standing orders it should apply to the facts of that case. It was further held that after the standing orders were finally certified those
became part of the statutory terms and condition of service, and would govern the relation between the parties. This decision, therefore, does not
help the respondent in any way. The decision reported in The Bagalkot Cement Co. Ltd. Vs. R.K. Pathan and Others, which was relied upon by
Mr. Banerjee also does not lay down anything more than saying that once certified the standing orders consitute the statutory terms of employment
between the industrial establishment in question and their employees. The fact that these standing orders do constitute the statutory terms and
conditions of service between the employer and the employees has not been disputed before us by the appellant. The contention of the learned
counsel for the appellant has been that even though standing orders constitute the statutory terms and conditions of service these are still the terms
and conditions of service between the employer and the employees. The above mentioned cases cited by councel for the respondent are, in our
opinion, of no assistance to his client''s case.
15. The next case cited before us on behalf of the respondent is the decision in Tata Chemicals Ltd. and other v. Kailash C. Adhvaryu, AIR 1964
Gujarat 265. In that case the Gujarat High Court held that a suit by an employee who was dismissed in contravention of the rules contained in the
standing orders was merely a suit for declaration of statutory invalidity of the dismissal and it was not enforcement of a contract of personal service.
The decision of the Gujarat High Court in that case proceeded upon the basis that the rights and obligations created by the standing order derive
their force not from the contract between the parties, but from the provisions of the Act. They are statutory right and obligations and not
contractual rights and obligations. Therefore, if the employee is dismissed in violation of the provisions of the standing orders it would be a violation
of contractual obligation. With great respect to the learned Judge we are unable to accept this view as correct. As already noticed above it is only
in three classes of cases that the servant can obtain a declaration that his dismissal is invalid in law and is a nullity. There also be a fourth class of
cases where a statute confers a status upon an employee and if an order is made in violation of any statute and if such violation affects his status
conferred by the statute then a court of law can make a declaration that the order is a nullity. In that case before the Gujarat High Court the learned
Judge observed that where there is a breach of statutory obligation which prevents the termination of the contract except in the manner prescribed
by the statute, the dismissal being in breach of the statute, is null and void and the servent is entitled to a declaration that the dismissal is null and
void and that he continues in the employment of the master. We are unable to subscribe to this proposition of law in so far as a private employer
and his employee is concerned. It may be so in case of a statutory body whose rights and obligations are regulated by statute creating it. But the
position is quite different in the case of a private employer. In such a case a termination of service in violation of the standing orders would
nevertheless be a breach of contract between the master and servant and a dismissal in breach of contract would only sound in damages.
16. The next decision relied upon by Mr. Banerjee is Sirsi Municipality by its President Sirsi Vs. Cecelia Kom Francis Tellis, . In that case the
Supreme court affirmed its earlier decision that it is only in the three classes of cases mentioned hereinbefore that a declaration that a dismissal is
invalid will be made by a court or a tribunal. The Supreme Court has further pointed out that there may be fourth category of cases where such
declaration can be made, namely, where a statutory status of an employee has been affected by my order made in violation of a statute, as was
held in Vine''s case. It is to be noticed also that the supreme court made a distinction between public authority or the state and a private employer,
as would appear from the following observations:--
The courts keep the state and the public authorities within limits of their statutory powers. Where a state or a public authority dismisses an
employee in violation of the mandatory procedurial requirement or on grounds which are not sanctioned or supported by statute the courts may
exercise jurisdiction to declare the act of dismisses to be a nullity. Such implication of public employment is thus distinguished from private
employment in pure cases of master and servant.
17. Again, it is to be noticed, that the Supreme Court made a distinction between dismissal of an employee in the context of contractual relation of
master and servant in general and the dismissal of a servant by statutory, including local authority or body, in breach of provisions of a statute
which regulates the exercise of their power. The Supreme Court held that it is only in the latter class of cases that a dismissal in violation of
statutory provision can be declared invalid and ultra vires. Mr. Banerjee also relied upon the decision in The Western India Match Co. Ltd. v.
Rameshwar Prasad, (1971) 2 Lab. I.C. 1447. In that case an employee having been dismissed in violation of the standing orders by its employer,
filed a suit against his employer for a declaration that the order dismissing him from service was void, illegal and inoperative. Before the Allahabad
High Court an objection was raised on behalf of the employer that the suit for a declaration as was claimed in that case was not maintainable in
view of section 21 of the Specific Relief Act. Their Lordships of the Allahabad High Court negatived that contention on the grounds that the
standing orders having provided for a particular procedure to be observed before an employee could be dismissed the impugned order which was
in violation of the said provision of the standing order was void and illegal. Their Lordships took a view that by virtue of the standing orders the
plaintiff in that suit got a statutory status and as there was a violation of the provision of the standing orders the plaintiff was entitled to the
declaration sought for. With great respect we are unable to accept this view as correct for reasons already mentioned. The Standing Orders, in our
view, do not confer any status upon the employee. It merely incorporate certain terms and conditions in the contract of service by virtue of the
statute. That is quite different, in our opinion, from giving a statutory status to the employee. The contract of service (sic)nonetheless remains a
contract for personal service. The result of granting of such a declaration in a case like this would be that the moment such a declaration is made
the servant has to be paid his salary. But his salary is governed by contract and not by the standing orders i.e. by the statute. Therefore, making
such a declaration would amount to enforcing the contract of personal service. For these reasons we are unable to follow the decision of the
Allahabad High Court in the abovementioned case. The last case cited before us by Counsel for the respondent is Bihar State Road Transport
Corporation Vs. State of Bihar and Others, . That case arose out of an ""award"" passed by a Labour Court on a reference u/s 10(1) of the
Industrial Dispute Act, 1947. In that case there was no question of violation of standings orders and it involved a question regarding non-
observance of principles of natural justice. That case, in our opinion, therefore, has no application in the present case. From what has been
discussed above it follows that the present case does not fall within any of the three well recognised exceptions where a court can grant a
declaration that an order of dismissal is invalid, inoperative and null and void. Neither does it fall within the fourth class of exceptions where a
statutory status has been conferred upon an employee or the dismissal complained of affects his status. In our opinion, therefore, the trial court
rightly dismissed the suit. We, accordingly, allow this appeal, set aside the judgment and decree under appeal and restore those of the trial court.
In the circumstances we make no order as to costs.
The operation of this order will remain stayed for a period of six weeks from this date.
S.K. Mukherjee, J.
I agree.