20 July 1970
Supreme Court







DATE OF JUDGMENT: 20/07/1970


ACT: Indian  Railways Act (9 of 1890), ss. 3(7), 138  and  148(2) and Art. 311 of the Constitution-Licensee of Railway  stall- Whether  railway servant-Termination of agreement-Rights  of licensee-Whether   entitled   to  benefit   of   Art.   311- Relationship of master and servant.

HEADNOTE: The  appellant  was  running two stalls-a tea  stall  and  a refreshment stall-at a railway station.  They were  allotted to  him  by the Railway administration  under  two  separate identical agreements of different dates, which provided that the  appellant was to run the stalls in accordance with  the directions  of  the Railway administration and  among  other terms  for  termination of the agreements,  they  were  also terminable  by  one month’s notice on  either  side  without assigning  any  reason.   As  the  appellant  had  committed certain  irregularities in running the stalls, a  fine  was, imposed  on him in terms of the agreements.  Since the  fine was  not  paid  he was given notice to vacate  and  when  he failed  to  do  so,  the  agreements  were  terminated,  and possession  was sought to be secured through the  Magistrate under  s.  138 of the Indian Railways  Act.   The  appellant moved  the  Sessions Court and High Court  on  revision  but without success, In appeal to this Court, HELD  :  (1)  In  view of the fact that  the  terms  of  the agreements which govern the parties expressly reserve to the Railway  administration  extensive power  of  directing  and regulating the appellant’s work and also of controlling  the manner  of doing the work, which is necessary for  affording ’amenities to the travelling public, the appellant would  be a railway servant as defined in s. 3(7) read with s.  148(2) of the Indian Railways Act, against whom action can be taken under  s. 138. [S.  L. Puri v. Emperor, A.I.R.  1937  Lahore 547  and R. L. Mazumdar v. Alfred Ernest, A.I.R.  1959  Cal. 64, approved.] [655 D-F] (2)  By reason of being a railway servant the appellant  did not automatically become entitled to the protection afforded to Government servants by Art. 311 of the Constitution.   He was neither a member of the civil service as contemplated by this  Article nor was he dismissed, re-moved or  reduced  in rank so as to attract Art. 311(2).  His rights are  confined to the terms of the written agreements and if he  considered that they had been wrongfully terminated, he could challenge such termination in civil courts under the law. [654 E-G]



(3) The express terms of the appellant’s agreements  exclude the  heritable  character  of  his right  which  is  only  a contractual right of a bare licensee subject to the terms of the  agreement.   No right outside these can be  claimed  by him.   The fact that the appellant. was allotted the  stalls in  order  to rehabilitate him as a  displaced  person  from Pakistan  cannot over-ride the terms of the  agreements  and absolve him of his obligations thereunder and permit him  to avoid the consequences of the alleged breaches of agreements on his part., [655 B-D, G-H] 651 (4)  Merely because a judicial Magistrate passed  the  order under  s. 138,  Indian  Railways Act, five  days  after  the dismissal of the appellant’s. application under Art. 226  of the  Constitution  by  the  Gujarat  High  Court  does   not establish malice on the part of the Magistrate. [656 A-B]      (5)   The  relationship  of  master  and   servant   is characterised  by agreement of service, express or  implied, and whether or not a given agreement is one of service is  a question  of  fact depending on its terms  considered  as  a whole. [655 H]

JUDGMENT: CRIMINAL  APPELLATE JURISDICTION : Criminal Appeal No.51  of 1970. Appeal  by  special leave from the order dated  October  23, 1969 of the Gujarat High Court in Criminal Revision No.  407 of 1969. The appellant appeared in person. S. P. Nayar, for the respondent. The Judgment of the Court was delivered by Dua,  J. In this appeal by special leave the  appellant  who has  appeared  in person challenges the order of  a  learned single   Judge  of  the  Gujarat  High  Court  (Shelat   J.) dismissing in limine criminal revision against the, order of the  Sessions  Judge dated October 4,  1969  dismissing  the appellant’s   revision  from  the  order  of  the   Judicial Magistrate,  Kalol  dated  August  30,  1969  granting   the application  of the railway administration under S.  138  of the Indian Railways Act and directing the P.S.I. Railways at Sabarmati who is also the P.S.I. Railways at Kalol to secure possession  of the stalls in question from the appellant  to the railway administration or to the person appointed by the administration in that behalf. The  appellant  had, on February 9, 1964,  entered  into  an agreement with the railway administration by means of  which he  was  allotted a Tea Table (hereafter  described  as  Tea Stall)  at Katol railway station.  This agreement came  into force  from may 18, 1964 and subject to the  provisions  for earlier termination was to remain in force for three  years. By a similar agreement dated February 20. 1965 the appellant was allotted a Refreshment Stall at the same railway station for  a  period of three years subject to the  provision  for earlier termination similar to the first agreement.  In both the agreements the appellant was described as the  licensee. Under these agreements the terms of which are identical  the appellant  was to run the two stalls in accordance with  the directions  of the railway administration.  In  addition  to other  terms  for earlier termination, the  agreements  were also  terminable  under clause 52 by one month’s  notice  on either side without assigning any reason.  On July 11, 1965 652 the  two Stalls were inspected by the  Commercial  Inspector



and  the Station Master and it was found that the  appellant had  committed  irregularities and was not running  them  in accordance    with   the   directions   of    the    railway administration.   A  fine of Rs. 100 was imposed on  him  in terms  of the agreement, the fine being payable  within  one week  under cl. 38(a).  The amount of fine having  not  been paid within the stipulated period a notice was given to  the appellant  on September 16, 1965 for vacating  ’the  railway premises  by October 30,,1965.  The appellant having  failed to vacate the premises, the agreements were terminated  with effect from November, 1965. As the possession of the Tea and Refreshment Stalls was  not delivered  by the appellant to the  railway  administration, the  latter applied to the Judicial Magistrate, Kalol  under s. 138 of the Indian Railways Act for securing possession of the  aforesaid ’premises.  Before the Magistrate it was  not disputed  that  since the appellant had to  work  under  the supervision  and according to the directions of the  railway administration he was a railway servant.  This, according to the learned Magistrate, was not denied by the appellant even in his written statement; on the ,other hand it was  claimed that  the position of the appellant was at par with that  of the   railway   servants.   The  appellant   contested   the application principally on the ground that the contracts  of the  Tea and Refreshment Stalls had been entered  into  with the  appellant  with the object of rehabilitating him  as  a displaced  person from Pakistan and that,  therefore,  those contracts   could  not  be  terminated.   After  a   lengthy discussion  on  the  points raised  the  learned  Magistrate expressed his final conclusion in these words :               "The opponent is proved to be railway servant.               Also  it is proved that his service  has  been               lawfully  discharged.   Mr.  Thakursingh,  the               learned   advocate   for  The   opponent   has               contended  that the applicant  has  terminated               the  agreement without any  justification  and               without assigning any reason.  But that is not               required  to  be done by either party  to  the               agreement.   It is argued by  Mr.  Thakursingh               that  the opponent is prepared to pay  arrears               of licence fees to the tune of Rs. 4,000 or so               and  he  is prepared to pay the  same  to  the               railway.   But  that is not a good  ground  to               disallow the application.  Section 138 of  the               Railways  Act provides for summary remedy  for               delivery to Railway Administration of property               detained  by a railway servant.  The  opponent               who  is  proved  to be  a  discharged  railway               servant  refuses to deliver the stall and  the               place on which be is permitted to place a  tea               table though served 653               with  notice.   Hence  he  is  liable  to   be               summarily  evicted.   He  has  prolonged   the               matter  for  unreasonably  long  period  under               different  excuses.  His services  are  termi-               nated and so he has occupied the stall and the               place for table unauthorisedly. . . ." Reliance  for holding the appellant to be a railway  servant was placed on S. L. Puri v. Emperor(’). The  appellant took tile matter in revision to the court  of the Sessions Judge.  There the appellant denied that he  was a  railway  servant and-urged as an  alternative  submission that  even  if  he was a railway servant  he  had  not  been validly   discharged.   In  any  event,  so  proceeded   his



contention,  no notice to deliver possession of  the  Stalls having been given to him before filing the application under s. 138, he could not be dispossessed through the court.  The Sessions Judge did not agree with these submissions and held that termination of the contract amounted to the appellant’s discharge  and,  therefore, proceedings  could  lawfully  be initiated  against him under s. 138 -of the Indian  Railways Act  for summary delivery of property, in his possession  or custody,  to the railway administration.  The appellant  was held  to ’have become a railway servant by virtue of  ss.  3 (7)  and 148 (2) of the Indian Railways Act.   The  Sessions Judge  relied for his view both on S. L. Puri’s case(’)  and R. L. Majumdar v. Alfred Ernest(’).  A revision to the  High Court, as noticed earlier, was dismissed in limine. On appeal in this Court the principal point urged by the ap- pellant is that by reason of being a railway servant he  was automatically entitled as a matter of law to the  protection afforded   to  Government  servants  by  Art.  311  of   the Constitution.   This,  submission  is  wholly  misconceived. Article 311 is in the following terms .               "(1)  No  person who is a member  of  a  civil               service  of the Union or an all-India  service               or a civil service of a State or holds a civil               post  under  the  Union or a  State  shall  be               dismissed or removed by an authority  subordi-               nate to that by which he was appointed.               (2)  No  such  person as  aforesaid  shall  be               dismissed or removed or reduced in rank except               after an inquiry in which he has been informed               of  the  charges  against  him  and  given   a               reasonable  opportunity  of  being  heard   in               respect  of  those  charges and  where  it  is               proposed, after such inquiry. to impose on him               any  such penalty, until he has been  given  a               reasonable opportunity of (1) A.I.R. 1937 Lahore 547. (2) A.T.R. 1959 Cal. 64. 654 making  representation on the penalty proposed, but only  on the basis of the evidence adduced during suck inquiry Provided that this clause shall not apply- (a)  where  a person is dismissed or removed or  reduced  in rank  on  the  ground  of  conduct  which  has  led  to  his conviction on a criminal charge; or (b)  where  the authority empowered to dismiss or  remove  a person  or to reduce him in rank is satisfied that for  some reason,  to be recorded by that authority in writing, it  is not reasonably practicable to hold such inquiry; or (c) where the President or the Governor, as the case may be, is  satisfied  that in the interest of the security  of  the State it is not expedient to hold such inquiry. (3)  If,  in  respect of any such  person  as  aforesaid,  a question arises whether it is reasonably practicable to hold such  inquiry as is referred to in clause (2), the  decision thereon of the authority empowered to dismiss or remove such person or to reduce him in rank shall be final." A  plain  reading  of  this  Article  would  show  that  the appellant  ,cannot  claim  its benefit.   The  appellant  is neither  a  member of the civil service as  contemplated  by this  Article nor has he been dismissed, removed or  reduced in  rank so as to attract the protection of sub-Art. (2)  of this  Article.  The appellant’s rights are clearly  confined to  the  written  agreements and if he  feels  aggrieved  by anything  done  by  the  railway  administration  which   he considers to be in breach of the terms of the agreements, he



is at full liberty to seek redress in accordance with law in the ordinary civil courts.  In other words, if he  considers that his agreements have been wrongfully terminated then  he can challenge such termination in the civil courts and claim whatever relief is available to him under the law. So far as the impugned order of the High Court and the order of the Sessions Judge is concerned we are unable to find any legal  infirmity  which would justify interference  by  this Court under Art. 136 of the Constitution.  The  relationship of  master  and  servant is characterised  by  agreement  of service,  express  or implied, and whether or  not  a  given agreement is one of service .is a question of fact depending on its terms considered as a whole. 655 Indeed, it is notthe  appellant’s case before us that  he was not a railway servant. On  the  contrary,  the   main plank of his challenge is that as arailway  servant  he is  entitled to claim the protection of Article 311  of  the Constitution.   This submission, as already observed by  us, is  clearly  based on a misunderstanding of  the  scope  and effect of that Article. The  appellant’s  next submission that  the  two  agreements mentioned above clothed him with an independent vested right to  do his business of running the two stalls  in  question, which  right  is heritable and not open  to  termination  is equally misconceived and unacceptable.  The express terms of the  agreements  exclude  the heritable,  character  of  the appellant’s right.  The only right which the appellant could claim  is  a contractual right of a bare licensee  and  that right  is subject to the terms contained in his  agreements. He   cannot  claim  any  right  outside  or   beyond   those agreements.   The terms which govern the  parties  expressly reserve  to  the railway administration extensive  power  of directing and regulating the appellants work and also, to an extent,  of  controlling  the  manner  of  doing  the  work. Keeping in view the purpose and object of these  agreements, namely,  that  of  affording  necessary  amenities  to   the travelling  public, retention of this overall power  by  the railway   administration   is  not  only   appropriate   but necessary.   The retention of this power by the railway  ad- ministration, in our view, constitutes relevant material for sustaining  the  conclusion  of the courts  below  that  the appellant  is a railway servant, as defined in s. 3(7)  read with s. 148(2), Indian Railways Act, against whom action can be  taken under s. 138 of the said Act.  This conclusion  is in  accord with the view expressed in the decisions  of  the Lahore and Calcutta High Courts to which reference has  been made  earlier.   We  do  not  find  any  cogent  ground  for disagreeing with that view which seems to have prevailed all these  years.   May be that the appellant was  allotted  two stalls  under  the  agreements  with  the  object  of  reha- bilitating   him   as   a  displaced   person.    But   that consideration cannot over-ride, the terms of the  agreements and absolve him of his obligations thereunder and permit him to  avoid  the  consequences  of  the  alleged  breaches  of agreements on his part.  In this appeal we are not concerned with  the  question  of  violation  of  the  terms  of   his agreements by the appellant nor can we consider the legality of  the termination of his agreements.  For  that  grievance the  appellant has to seek relief elsewhere by  a  different process. It  may,  in  this  connection,  be  pointed  out  that  the appellant  had  also approached the Gujarat  High  Court  by certiorari  challenging  the order of fine imposed  on  him, relying on the objection that the imposition of the fine was



in violation of Art. 311 of 656 the Constitution.  This writ petition was rejected on August 25,  1969.  In the special leave application, the  appellant has  averred that the Judicial Magistrate passed  the  order under S. 138 of the Indian Railways Act on August 30,  1969- only five days after the order of the High Court  dismissing his  writ  petition.-and it is contended that  the  impugned order must for that reason be held to have been inspired  by malice  against the appellant.  We do not find  any  warrant for this assumption. The   appellant   had  also  filed   several   miscellaneous applications in this Court which were dismissed by us  after hearing  him.  He wanted to summon some witnesses  and  also some documents for proving that the allotment of the  stalls had  been made to him for the purpose of rehabilitating  him as a displaced person.  We did not consider it necessary  to take  evidence  in this Court on that  point.   The  written agreements, in our view, conclude the matter.  The appellant also sought adjournment of this appeal on the ground that he wanted  to engage a senior counsel to argue his appeal,  but that  counsel could only appear after the  summer  vacation. We did not consider that to be a sufficiently cogent  ground for  adjourning  the appeal, the hearing of  which  was  ex- pedited  on April 13, 1970.  The appellant also applied  for referring  this  case  to the  Constitution  Bench  because, according   to  him,  the  question  raised  was  of   great constitutional  importance.   We  did not  find  any  cogent ground for acceding to this prayer. The appellant has, in his arguments, laid repeated stress on the  submission  that  the impugned action  of  the  railway administration would deprive him and his family of the  only source   of  livelihood.   That  consideration  has   little relevance  because  this  appeal has to be  decided  on  the merits on the existing record in accordance with law.   That indeed  is  a matter between the appellant and  the  railway administration.  Ms request for allotment, we have no doubt, will be considered on its merits in accordance with the  law and the relevant departmental practice.  It is not for us in these  proceedings to express any opinion on the  merits  of his claim. This appeal fails and is dismissed. V.P.S.            Appeal dismissed. 657