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PETITIONER: INTEGRATED RURAL DEVELOPMENT AGENCY

       Vs.

RESPONDENT: RAM PYARE PANDEY

DATE OF JUDGMENT24/02/1995

BENCH: PARIPOORNAN, K.S.(J) BENCH: PARIPOORNAN, K.S.(J) VERMA, JAGDISH SARAN (J)

CITATION:  1995 SCC  Supl.  (2) 495 JT 1995 (3)   119  1995 SCALE  (2)7

ACT:

HEADNOTE:

JUDGMENT: PARIPOORNAN, J.: 1.   Special leave granted. 2.   The  defendant  in O.S. No. 1204 of  1981,  in  Munsiff Court No. 3, Deoria, is the appellant.  The plaintiff in the suit  is the respondent.  The appellant -  Integrated  Rural Development  Agency  -  is  a  body  registered  under   the Societies  Registration  Act.  It has its  own  Articles  of Association.   The  respondent-plaintiff  was  appointed  as Junior  Clerk in the Integrated Rural Development Agency  on 14.5.1980  against  a permanent vacancy.   His  service  was terminated  on 6.6.1980. Thereupon, the respondent  filed  a suit  and  prayed for the grant of a  declaration  that  the termination order was illegal and void and it was passed  in violation of the rules governing the appellant.  The learned Munsiff  held  that the appointment of  the  respondent  was temporary and the termination order was not illegal or  void and  dismissed the suit.  The respondent-plaintiff filed  an appeal  before the VI Additional District Judge,  Deoria  -- Civil  Appeal  No.  186  of the  1982.   By  judgment  dated 29.4.1983   the  appeal  was  dismissed.   Thereafter,   the respondent   plaintiff filed Second Appeal No. 2163 of  1983 in  the  High Court of Allahabad.  Katju,  J.,  by  Judgment dated 22.3.1993, held that the termination of the service of the respondent was against the mandate of Rule 13(b) and  so the  termination  order  dated 6.6.1980  was  illegal.   The concurrent  judgments of the courts below were reserved  and the learned Judge fur- 121 ther  directed  that  the appellant will  be  reinstated  in service  and also will be entitle to arrears of salary  from the  date of term nation.  Aggreived by the aforesaid  judg- ment  of  the  learned Single Judge  the  Intergrated  Rural Development  Agency defendant in the suit -- has filed  this appeal by special leave. 3.   We  heard Mr. A.K. Srivastava, learned counsel for  the

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appellant  and  Mr.  S.A Gilani,  learned  counsel  for  the respondent 4.   The order of appointment of the respondent is quoted at page 21 of the paper book, which is as under :-               "S/Shri Mohan Prasad and Gorakh Nath on  being               promoted  to  the posts  of  Stenographer  and               Accountant    respectively,   the    following               employees who are working as work-charged  for               the  last four months arc hereby appointed  as               Clerks  in the payscale of  Rs.200-320/-  with               effect from 14.5.1980. They shall be  entitled               to  receive Dearness Allowance and  other  al-               lowances as approved by the Government.  Their               appointment  is temporary and  their  services               can be terminated at any time.               1.    Shri Rain Pyare Pandey S/o Late Kushahar               Pandey, r/o Village Pipraich, P.O. Deoria.               2.    Shri Krishan Kumar Shukla, s/o Shri  Ram               Subhag Shukla,r/o Sindhi Mill Colony, Deoria.                                    Sd/-                       District Development Officer/                         Project Officer, Deoria." (Sri Ram Pyare Pandey is the respondent herein). In exercise of the powers vested under Section 20(a) of  the Articles of Association, the Governing Body of the appellant had  framed its own rules regarding the conduct of  business and  office procedure.  Rule 13 of the said rules is to  the following effect:-               " 13.PERIOD OF THE OFFICE OF THE EMPLOYEES:               The  period  of office of an employee  of  the               Agency shall not be determined until: -               a)    His  resignation  has been  accepted  in               writing  by  the authority  competent  to  his               successor or               b)    The  services  of the Employees  can  be               terminated with one month’s notice from either               side.  " Katju, J., after having held that notwithstanding the  terms of appointment order to the effect that the services of  the respondent can be terminated at any time, rule 13(b), quoted above, requires one month’s notice to be given before termi- nation  and that the rule should prevail, which renders  the termination  order  dated  6.6.1980 illegal  and  viod.   In consequence, the learned Judge directed reinstatement of the respondent  in service, with arrears of salary.  We  are  of the view that the respondent is not entitled to either rein- statement or arrears of salary from the date of termination. The  learned single Judge was wholly in error affording  the relief  of reinstatement and back wages.  We will state  our reasons for the aforesaid conclusion. 5.   The  appellant - Integrated Rural Development Agency  - is one registered under Societies Registration Act.  It  has its own Articles of Association.  It has framed its 122 own rules thereunder.  There is no plea or material or proof that  the appellant - Integrated Rural Development Agency  - is  one constituted under statute or is owned or  controlled by the State Government or an instrumentality of the  State. The  relationship between the appellant -  Integrated  Rural Development Agency - and the respondent is based on contract and  is  purely  one of master and servant.   As  stated  by Jenkins,  L.J.,  in  his dissenting judgment,  in  Vine  vs. National  Dock  Labour  Board (1956 (1) AER  1),  which  was approved  in  appeal by the House of Lords in 1956  (3)  AER 939:

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             "               In  the ordinary case of master  and  servant,               however,  the  repudiation  or  the   wrongful               dismissal  puts an end to the contract, and  a               claim for damages arise.  It is necessarily  a               claim  for  damages  and  nothing  more.   The               nature  of the bargain is such that it can  be               nothing more." Delivering the judgment of three member Bench of this  Court in  Nandganj Sihori Sugar Co. Ltd.  Rae Bareli  and  another vs. Badri Nath Dixit and others (1991 (3) SCC 54),  Thommen, J. stated the law thus:-               "A contract of employment cannot ordinarily be                             enforced  by  or  against  aan  employer.   Th e               remedy is tto sue for damages (See Section  14               read  with Section 41 of the  Specific  Relief               Act;  see Indian Contract and Specific  Relief               Acts  by  Pollock and Mulla,  10th  edn,  page               983).   The grant of specific  performance  is               purely discretionary and must be refused  when               not  warranted by the ends of  justice.   Such               relief  can  be granted only  on  sound  legal               principles.   In the absence of any  statutory               requirement, courts do not ordinarily force an               employer  to recruit or retain in  service  an               employee not required by the employer.   There               are,  of  course, certain exceptions  to  this               rule, such as in the case of a public  servant               dismissed  from  service in  contravention  of               Article 311 of the Constitution; reinstatement               of  a  dismissed worker under  the  Industrial               Law;  a  statutory body acting  in  breach  of               statutory  obligations,  and the  like.  (S.R.               Tiwari  v. District Board, Agra (AIR  1964  SC               1680);  Executive  Committee  of  U.P.   State               Warehousing Corporation v. C.K.Tyagi (1969 (2)               SCC 838): Executive Committee of Vaish  Degree               College, Shamli v. Lakshmi Narain (1976(2) SCC               58); see Halsbury’s Laws of England, 4th edn.,               Volume 44, paragraphs 405 to 420)." Similarly in Ridge v. Ball-,win, [1963 (2) AER 66 (H.L.)],               "The  law regarding master and servant is  not               in   doubt.    There   cannot   be    specific               performance  of a contract of service and  the               master  can  terminate the contract  with  his               servant at any time and for any reason or  for               none.   But  if  be does so in  a  manner  not               warranted by the contract he must pay  damages               for  breach of contract. go the question in  a               pure  case of master and servant does  not  at               all depend on whether the master has heard the               servant  in  hiw own defence:  it  depends  on               whether the facts emerging at the trial  prove               breach of contract.  But this kind of case can               resemble  dismissal from an office  where  the               body employing the man is under some statutory               or  other  restriction  as  to  the  kind   of               contract which it can make with its  servants,               or  the grounds on which it can dismiss  them.               " In  the light of the above principles, it follows  that  the relief of reinstatement could not be granted in the  present case.    By  affording  the  relief  of   reinstatement   or backwages,  the courts will, in fact, be  granting  specific

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performance of contracts of service, which can be done  only in the 123 exceptional  or  rare cases referred to in the  Judgment  of this  Court in Nanddganj Sihori Sugar Co. Ltd,,  Rae  Bareli and another vs.  Badrinath Dixit and others (supra). 6.   In  the  result,  the relief of  reinstatement  of  the respondent  in service and also arrears of salary  from  the date  of termination, are improper and unjustified  in  law. The reliefs so granted are hereby set aside.  The appeal  is allowed.  In the circumstances, there shall be no. order  as to costs.