business manager - termination of service of private employee - whether hit by sec.23 of Contract and entitled for damages ?= I) Whether the civil suit lies and the relief granted by the trial Court in awarding damages including on the quantum for the termination while holding the termination is hit by Section 23 of the Contract Act, is unsustainable ? = the declaratory relief in service matters are maintainable.= the age of the plaintiff as on the date of termination notice under Ex.A.4 was about 45 years in claiming there could be at least 12 years of service remained and in saying as on the date of termination he was drawing undisputedly Rs.45,430/- per month and therefrom even estimated for 4 years of the salary payable at that rate it can be arrived of Rs.20lakhs. In fact, as pointed out by the appellant neither in the plaint nor in the plaintiffs evidence much less in the arguments before the trial Court, it was not raised much less pleaded of plaintiff could not get any alternative employment and remained idle totally with no any earnings or avocation and became burden to somebody with any basis for it but for saying the plaintiff could not secure an equivalent employment. Thus, it is not even a case of specific plea of he could not be in some other avocation to get any means. Once that also requires consideration in arriving the quantum of damages, even from possessing earning capacity not in dispute, even 50% therein as capacity of getting alternative source of earning taken consideration, what the trial Court granted of Rs.20lakhs requires to reduce to Rs.10lakhs and but for that there is nothing to interfere with the trial Courts decree and judgment by sitting against.

HONOURABLE Dr. JUSTICE B.SIVA SANKARA RAO          

C.C.C.A.No.177 of 2004

29-01-2016

M/s. Zee Tele-Films Limited  Rep. by its Assistant Vice President, Legal,
Continental Building and others...Appellants/Defendant Nos.1 and 3

Syed Inam Ur Rahaman.Respondent/plaintiff.
                          Indru Bai Chandani,
                          Director (H.R.) and another.Respondents/Defendants 3
and 4.
                                                                       
Counsel for the appellant:Sri Vedula Venkataramana

Counsel for 1st respondent: Sri A. Tulsi Raj Gokul
                             Counsel for 2nd and 3rd respondents : None

<GIST :  ---

>HEAD NOTE :  ---

? Cases referred:        :
1. AIR 1986 SC  1571
2. AIR 1991 SC  101
3. 1974 (1) WLR 1308
4. (2005)6  SCC 657
5. AIR 1977 SC  745
6.  AIR 1976 SC 888

HONOURABLE Dr. JUSTICE B.SIVA SANKARA RAO          

C.C.C.A.No.177 OF 2004  

JUDGMENT:  
        The sole plaintiff who is the 1st respondent to the appeal filed the
suit O.S.No.47 of 2002 on the file of the XI Additional Chief Judge (Fast
Track Court) City Civil Court, Hyderabad against four defendants of
whom the appellants M/s Zee Tele-films Limited, Siti Cable Network
Private Limited are the defendants 1 and 3 and 2nd defendant is one
Indru Bai Chandani, Director(H.R.) of 1st defendant and 4th defendant is
the Director of 3rd defendant. The 3rd and 4th defendants are shown as
proforma parties and they are the respondents 2 and 3 in the appeal.
The suit was filed seeking the reliefs to declare the action of the
defendants contained in the letter dated 06.09.2001 terminating the
services of the plaintiff invoking Clause 16 of the appointment order
dated 05.09.95, is wrongful and illegal as opposed to public policy and
also for damages against the  defendants to a sum of Rs.20lakhs with
interest at 24%p.a. from the date of the suit till the date of realization
as a consequential relief to the main prayer that the termination of
services of the plaintiff was wrongful and to grant such other reliefs.
        2. The averments in brief in the plaint are that the plaintiff by
name Syed Inam Ur Rahaman was appointed as Business Manager vide    
Ex.A.1 letter dated 05.09.1995 issued by the 3rd defendant-Siti Cable
Network Private Limited now represented by the 4th defendant as its
resident Manager posted under said 3rd defendant within the State of
A.P. and it is covered by the contractual terms of appointment with 17
clauses. He worked later as directed under the 1st defendant in Bombay
w.e.f. 01.04.2000 covered by Ex.A.2 till transferred back to Hyderabad
under Ex.A.3,dated 29.11.2000 while he was so working, not even for
any allegations against his performance much less as a measure of
disciplinary action, while appreciating his performance as above
satisfying with positive remark, however, claimed terminated by
invoking clause 16 of the contract of employment with three months
notice of termination from the alleged option both the employer and
employee got to do so.
        3. The suit claim was opposed by the defendants by filing written
statement of D.1 adopted by the D.2 and D.3, leave about the D.4 did
not file any separate written statement much less adopted.  It is averred
that of D.3-Siti Cable Network having its registered office at New Delhi is
a subsidiary of D.1-Zee Tele films Limited which is engaging of Cable
Network operations,  and distribution of films through cable and satellite
channel and D.1 and D.3 are not one and the same entity as alleged by
the plaintiff but are independent entities and they are justified in
serving the termination notice under Ex.A.4 in view of the closure of the
UTN channel w.e.f. July, 2001 for not able to generate work to continue
and by invoking clause 16 which includes with three months notice of
termination and sought for dismissal of the suit saying plaintiff is not
entitled to the relief of declaration much less the other relief of
damages with interest.
       4.  The trial Court therefrom having formulated and settled as many
as 8 issues of which issue No.6 is as to the entitlement of the relief of
declaration and consequential relief of damages, besides issue No.5 and
7 are on maintainability of the suit reliefs and existence of cause of
action or not and issue No.3 besides 1 and 2 as consequential to it of the
appointment and authority to terminate respectively for D.3 by D.1 and
having answered the two issues mainly placing reliance upon the
expressions of the Apex Court in Central Inland Water Transport
Corporation Limited Vs. Brojonath  two Judge Bench, that was referred
in the subsequent Constitution Bench expression in Delhi Transport
Corporation Vs. D.T.C. Mazdoor Congress  and by quoting the
expressions from Delhi Transport Corporation supra which relied upon
the observations of Lord Diplock in A Schroeder Music publishing
Company Limited  Vs. Macaulay (formerly instore)  and the
observations of Justice Madon which includes reference as to distress,
circumstances and conditions of one prevails upon the other in a
dominating position can be construed irrespective of there is consensus
ad idem as opposed to public policy dragnet u/sec.23 of the Contract
Act to grant the relief and therefrom concluded of the plaintiff entitles
to the damages as claimed in the suit by estimation of Rs.20lakhs with
interest thereon from date of suit at 6% p.a. till realization.
        5. The defendants 1 and 3 as referred supra maintained the
present appeal impugning said findings and conclusions arrived by the
trial Court with contentions in the appeal that once clause 16 is a
private contractual obligation with consensus ad idem enables not only
the employer if at all but also the employee to leave the entity if he
chooses when contemplated with three months notice and the same is  
neither arbitrary nor unreasonable nor inequitable much less opposed to
public policy and there is nothing to say the same is hit by Section 23 of
the Contract Act, apart from no cause of action to maintain civil suit for
its maintainability, much less to grant the discretionary relief of
declaration of the said termination is hit by Section 23 of the Contract
Act or to award any damages and the damages arrived are also 
unsustainable and baseless with no reason or rationale and thereby
sought for setting aside the trial Courts decree and judgment supra and
by dismissing the suit claim.
      6. The learned counsel for the appellants /defendants 1 and 3 in
support of the appeal contention placed reliance on the subsequent
expression of the Apex Court (two Judge Bench) in Binny Ltd. Vs.
V.Sadasivan  where particularly at paras-25,26, 29 to 33 observed that
the matters are prone to writ jurisdiction only when there is any
element of public sector contract of employment and not for any private
bodies in saying the principles of natural justice and violation of the
Section 23 of the Contract Act and Article 14 of the Constitution of India
with reference to the respective rules, cannot be applied to the private
bodies and ultimately observed in deciding the issue is not prone to a
writ jurisdiction of the private employee impugning the termination but
for to invoke any civil remedy or to approach other fora like labour
Court.  It is the submission of the learned counsel for the appellant
therefrom that the trial Court went wrong in placing reliance on the two
expressions of the Apex Court in Central Inland and Delhi Transport
Corporation supra which are in respect of either public employee or in a
civil suit in relation to a college formed as a society for termination of
the employee and not in private sector and not within the meaning of
State for writ jurisdiction and those decisions have no applications to
the present facts.
         7. Whereas, it is the contention of the learned counsel for the 1st
respondent/plaintiff by supporting the trial Courts judgment in saying
once the trial Court arrived in its conclusions within the discretionary
exercise of declaration from maintainability of the civil suit within the
meaning of Section 42 of the Specific Relief Act if not even otherwise
under Section 9 of C.P.C. as a suit of civil nature and so far as that
discretionary exercise of the trial Court concerned, there are limitations
particularly in service matters on the appellate authorities to interfere
merely because some other view is possible, unless it comes to the
conclusion on wrongful exercise of discretion, by relying upon in Mysore
State Road Transport Corporation Vs. Mirza Khasim Ali Beig  at para 18
and also the other expressions in support of the conclusions arrived by
the trial Court from Central Inland and Delhi Transport Corporation
supra and from the expression of the Apex Court in Executive
Committee of Vaish Degree college, Shamli  Vs. Laxmi Narain  (three
judge Bench) in relation to private employee though it prohibits
reinstatement under the Section 14(b) of the Specific Relief Act,
damages can be awarded for wrongful termination of service.
      8. Heard as referred supra at length and perused the material on
record.
      9. Now the points for consideration to decide the appeal are:
I) Whether the civil suit lies and the relief granted by the
trial Court in awarding damages including on the quantum
for the termination while holding the termination is hit by
Section 23 of the Contract Act, is unsustainable and it
requires any interference by this Court and if so, to what
extent this Court while sitting in appeal can interfere?
II) To what relief?
Point No.I:
      10. The facts not in dispute are that the plaintiff was appointed as a
business manager in the 3rd defendant entity-Siti Cable Network Private
Limited as per Ex.A.1 letter dated 05.09.1995 and while so working was
terminated with three months notice invoking clause 16 of the
appointment order under Ex.A.1 by Ex.A.4 by the 1st defendant. It is one
of the contentions therefrom that is also answered by the trial Court in
saying once it is the contest of the defendants in the written statement
of D.1 and D.3 are separate entities D.3 having been appointed if at all
terminate is only by D.3, and not by D.1 and that is enough to say
therefrom of termination is not pursuant even to the private contract
much less to invoke clause 16 of the contract and thus the termination is
not legal; apart from same also opposed to the public policy even
governed by the contractual terms. There is substance to the conclusion,
though not in so many specific words by the trial Court.
        11.  Coming to the other aspects covered by rival contentions, the
two expressions that is of Vaish Degree college(three Judge Bench)  and
Mysore State Road Transport Corporation(two Judge Bench) supra clearly
speak and spelt out the declaratory relief in service matters are
maintainable. No doubt specific relief Act provisions are not exhaustive,
however, that does not mean even a suit of civil nature otherwise not
falling within the scope of Section 34 of the Specific Relief Act, wont lie
for not impliedly or expressly taking away the jurisdiction of a civil
Court. It is not a contention either from the written statement or
grounds of the appeal much less from any of the expressions referred
supra including of the appellant of Binny supra to say there is a bar to
civil suit. In Binny supra even in the case of private bodies, it is not
prone to writ jurisdiction much less to construe strictly the application
of   Article 14 of the Constitution of India or basic principles of natural
justice, but for otherwise to govern by contractual terms and to consider
the scope of Section 23 of the Contract Act therefrom, if at all, opposed
to public policy. Though it is one of the contentions of the learned
counsel for the appellants (D.1 and D.3 of the suit) of the contractual
terms when equitably speak, either of the employer and employee can
invoke when the employer invoked the clause 16 and terminated with
three months notice, there is nothing to say opposed to public policy
from the facts and circumstances showing employee did not leave the
job all through after appointment by working hard and still employer
terminated him and from that the employee could not secure a suitable
employment suffice to say, the employer is in a dominant position in
upperhand and exercised the discretion unjustly, that too, when the
employee has been sincerely working with clear track record with
unblemished service and not even terminated for any misconduct and
misdemeanor in the course of his employment and  that too the so called
entity issued the termination order is not even the entity that appointed
as can be seen by keeping Exs.A.1 and A.4 in juxtaposition, besides same
not even in dispute but for to say another sister concern to whom if at
all transferred  was not continuing there as was re-transferred back to
the entity appointed i.e. D.3, apart from if at all to terminate is only by
D.3,D.1 has no right undisputedly being an independently and separate
entity to give order of termination, same is illegal and also opposed to
public policy including contra to the terms of the clauses 1 to 16 of the
contract of employment under Ex.A.1.
       12. Therefore, so far as that finding of the trial Court concerned,
even trial Court referred to the expressions of Central Inland and Delhi
Transport Corporation supra which are in relation to public employment
there in Delhi Transport Corporation(particularly) the principle laid down
by Lord Diplock in A Schroeder Music publishing Company Limited
supra referred and relied which principle equally applies herein, so
also the observations in saying, not even under direct undue influence, it
can be implied if any of the dominance of employer that is prone to the
dragnet of Section 23 of the Contract as opposed to public policy from
such distress situation prevailed in the position of the employee when
compared to the upperhand of the employer to consider. Apart from it,
the two expressions in Mysore State Transport and Vaish Degree college
supra also speak of a claim by a private employee, civil law remedy is
sustainable but for to say declaratory relief is discretionary to exercise
sparingly. Here from the expressions once the discretion was exercised
by the trial Court, for this Court while sitting in appeal, there is nothing
to interfere for nothing to say any wrongful exercise of the discretion so
far as that finding of the trial Court of the termination is not legal and
opposed to Public policy under Section 23 of the Contract Act.  Hence
said finding of the trial Court requires confirmation even by considering
the expression of Binny supra placed reliance by the appellants from its
saying the private employment contracts which govern by contractual
obligations prove to dragnet of public policy principle.
     13. Next coming to the quantum of compensation arrived by the trial
Court of Rs.20lakhs with interest at 6% p.a. is excessive and
unsustainable concerned, no doubt in the plaint there is a calculation
more particularly at para-6 in saying the age of the plaintiff as on the
date of termination notice under Ex.A.4 was about 45 years in claiming
there could be at least 12 years of service remained and in saying as on
the date of termination he was drawing undisputedly Rs.45,430/- per
month and therefrom even estimated for 4 years of the salary payable at
that rate it can be arrived of Rs.20lakhs. In fact, as pointed out by the
appellant neither in the plaint nor in the plaintiffs evidence much less
in the arguments before the trial Court, it was not raised much less
pleaded of plaintiff could not get any alternative employment and
remained idle totally with no any earnings or avocation and became
burden to somebody with any basis for it but for saying the plaintiff
could not secure an equivalent employment. Thus, it is not even a case
of specific plea of he could not be in some other avocation to get any
means. Once that also requires consideration in arriving the quantum of
damages, even from possessing earning capacity not in dispute, even 50% 
therein as capacity of getting alternative source of earning taken
consideration, what the trial Court granted of Rs.20lakhs requires to
reduce to Rs.10lakhs and but for that there is nothing to interfere with
the trial Courts decree and judgment by sitting against.
Point No.II:
         14. Accordingly and in the result, the appeal is allowed in part by
confirming the order of termination as illegal and opposed to public
policy and consequently from entitlement to reasonable sum as damages
to be arrived by some guess work and from what the trial Court arrived
of  Rs.20,00,000/-(Rupees twenty lakhs only)  is excessive by reducing to
50% therein awarded towards damages Rs.10,00,000/-(Rupees ten lakhs  
only) by confirming the rate of interest awarded thereon. Needless to
say any amount so far paid or deposited can be withdrawn, if not
withdrawn and if not paid, or partly paid, to pay the whole or the
remaining balance within three months from today.  There shall be no
order as to costs of the appeal. Consequently, miscellaneous petitions, if
any pending in this appeal, shall stand closed.
________________________  
Dr. B. SIVA SANKARA RAO, J  
Date: 29.01.2016

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