Ashok Paper Mills Ltd. vs Bani Gopal Basak

S.S. Ganguly, J.—The facts leading to the present appeal may be summarised in the following way:

The Appellant, Ashok Paper Mills, a public limited company having factories at Jogighopa in Goalpara and Rameshwarnagar in Durbhanga and offices at Guwahati and Calcutta, appointed the Respondent as a Sales Officer with headquarters in Calcutta on March 12, 1976. The Appellant-company was a flourishing concern but it fell upon bad days, both its factories were closed in 1982-83 and it was declared as a Relief Undertaking under the provisions of the Assam State Industries Relief Undertakings (Special Provisions) Act, 1984. Payment of salary became irregular and from October 1982, onwards increments, promotions, D.A., H.R.A. remained suspended. The company issued a circular dated May 30/31, 1988, addressed to all employees informing them that they could voluntarily resign from service and that in that case the company would arrange to pay them all outstanding allowances. On the day this circular issued, the company also issued an order transferring the Respondent from Calcutta to the Jogighopa unit. Thereafter, by another order dated June 9, 1988, the Respondent was released from the Calcutta Office. This led to the Respondent''s filing Title Suit No. 999 of 1988 and obtaining an ad interim order of injunction on June 13, 1988, alleging that (i) the order of transfer was an order of degradation of rank since it did not state specifically what was the post which the Respondent was going to fill up at Jogighopa, (ii) that the services of the Respondent will be required in Calcutta for promoting sales if the Jogighopa unit starts functioning and not at Jogighopa where a Sales Officer has practically no function and (iii) lastly, that the order of transfer meant mala fide victimization of the Respondent with the ulterior motive to compel him to resign his job which he was not in a position to do at present with all his dues against the Appellant remaining unpaid and outstanding. The Appellant challenged the ad interim order under Order 39 Rule 4 of the CPC alleging that the said order had been obtained by misrepresentation and suppression of material facts and further that Appellant would suffer irreparable loss since the services of the Respondent who had no work to do here in Calcutta were transferable and would be better utilized at Jogighopa where an attempt is being made to restart the factory. It was also urged that since the Respondent had already been released from Calcutta office with effect from June 11, 1988, the ad interim order should not have been passed on June 13, 1988. Certain other objections were also taken. Upon hearing both the parties the learned Chief Judge, City Civil Court, Calcutta, passed an order on May. 4, 1989, allowing the Respondent''s petition for temporary injunction restraining the Appellant from giving effect to the order of transfer holding that (i) the Respondent had a prima facie case to indicate that in view of the terms of employment he was not liable to be transferred outside Calcutta and further that (ii) even granting that he was liable to be transferred the impugned order was not a bona fide order of transfer. Hence, this appeal.

Both the conclusions of the learned trial Court are being challenged in this appeal. The Respondent added another dimension to this dispute by challenging the competence of Mr. Krishna Kanta Kalita who filed this appeal on behalf of the two Appellants.

In the affidavit accompanying the stay petition Mr. Kalita described himself as Chief Officer (Special Duty) and Company Secretary of the Appellant concern and, as such, a principal officer thereof. It is urged that Mr. Kalita does not have the required qualification as u/s 2(45) of the Companies Act, 1956, to be a Company Secretary, that he is not a full-time Company Secretary as required u/s 383A of the Act and, lastly, that he has not been authorised by the Board of Directors to file this appeal.

If Mr. Kalita does not have the required qualification under the Companies Act for that the authorities of the Appellant company will be answerable in case there be some such provisions to the appropriate authorities. But, so long as he is not removed from his office by the Board of Directors he continues to be the Secretary of the company and no third party can challenge that position.

We are also told that the authorities of the Appellant company have duly authorised Mr. Kalita to file this appeal and to take all appropriate steps therein. Under the circumstances stated we are of the view that the affidavit sworn by Mr. Kalita may be accepted and it may be held that as a principal officer of the company duly authorised Mr. Kalita has full competence to file this appeal.

Now to the question if the Appellant''s services were transferable. The first letter appointing the Respondent is dated March 12, 1976, and it informed him that his ''posting will be at Calcutta'' and further that "A formal appointment letter will be issued to you from our Head Office, Jogighopa". The formal appointment letter dated June 22, 1976, contained the following term:

(5) Headquarters: Your headquarters, for the present, will be in Calcutta, but you will be liable to be transferred and posted to any other units/offices of the company in any part of the country at any time. There obviously could not be two letter of appointment. The letter of appointment had to be one. Which one of the two letters mentioned above was the letter of appointment of the Respondent ? Obviously, the formal letter of appointment was the letter of appointment in this case. The first letter permitted the Respondent to join, but this was no letter of appointment as such or else there would not have been any need for a formal letter of appointment. Hence, we are of the view that the formal letter of appointment was the only letter of appointment in this case and that, as such, the Respondent was liable to be transferred as per the terms and conditions of the formal letter of appointment.

It is urged from the side of the Respondent that he is not nor even was in a position to leave Calcutta and that he would not have accepted the job had he known that it was a transferable job. We do not find any merit in this argument. The Respondent received the formal letter of appointment only a few months after accepting the job. He could have straightened out the matter at that very time. Citing decision in U.P. Government Vs. J.R. Bhatta, it is urged that the Appellant exercised undue influence and coerced the Respondent to accept the formal letter of appointment. We do not find any merit in this argument also. The Respondent - so we are told - left one job for accepting the job under the Appellant - presumably because the terms of the latter were better than those of the former. In case he felt that the terms of the latter did not suit him, he certainly could have and should have opted for another job. After remaining in service and reaping benefits granted by the letter of appointment for such a long time, the Respondent cannot now be heard to say that he would not be bound by inconvenient terms of the letter of appointment. Citing Sushil Kumar and Anr Vs. Ram Prakash and Ors, it is urged lastly that the term making the job transferable was imposed latter and that hence it was not binding on him. In the cited case the job was made transferable after the Respondent had entered service. That was not the case here since here transfer was made out of the terms and conditions of service.

Considering all the circumstances we are inclined to hold, therefore, that the services of the Respondent were transferable.

Now to the question as to whether the order of transfer was passed in good faith or if it was vitiated by mala fide. It is urged from the side of the Appellant that since an attempt is being made to restart the factory at Jogighopa, the Appellant would require the services of experienced hands like the Respondent and that, as such, he was being transferred thereto�more so as he had absolutely nothing to do here in Calcutta. It is urged from the side of the Respondent on the other hand that he will not also have anything to do at Jogighopa since the factory there has not been restarted, that as a Sales Officer his place was in Calcutta and that the order of transfer was passed merely to pressurize him to resign voluntarily since he was not willing to resign just now with his dues - amounting to Rs. 30,000 and odd, remaining unaccounted for and unpaid and more so as the Respondent cannot now sue the Appellant concern for the same as it has been declared a relief undertaking.

It may be that the Respondent has a large amount outstanding against the Appellant which is not recoverable at present. From that it does not follow that the order of transfer was passed merely to compel the Respondent to resign abandoning his dues from the Appellant. Admittedly, the Respondent has nothing to do here in Calcutta. His apprehension is that he will not also have anything to do there at Jogighopa where the factory has not started running. Granting that he is placed in an equivalent job and his salary is paid the Respondent can hardly resist the order of transfer on the ground that he will have nothing to do at his new place of posting. It is for the employer to decide where the services of an employee should be utilized. Here the employer feels that the services of the employee should better be utilized at Jogighopa since it has been decided to restart the factory there. It has been stated that there are posts of sales officers also at Jogighopa. Prima facie it becomes difficult to find fault with the order of transfer. In Shanti Kumar v. Regional Deputy Director AIR 1981 S.C. 1577 it was observed that transfer of a Government servant may be due to exigencies of service or due to administrative reasons and that the Court cannot interfere in such matters. The employee in this case is not a Government servant; but, the principle certainly applies.

Considering all the circumstances we are of the view that prima facie the services of the Respondent were transferable and further that the order of transfer was not vitiated by malice or mala fide.

In the circumstances stated, it is hereby ordered that the appeal is hereby allowed The impugned order passed by the learned trial Judge is hereby set aside and the Respondent''s petition for temporary injunction is hereby rejected. Let it be clearly understood, however, that at Jogighopa the Appellants must provide the Respondent with the job of a Sales Officer or with a job involving duties which the Respondent was discharging here in Calcutta. The Court desires that the Appellant-company should earnestly consider transferring the Respondent back to Calcutta as soon as the situation permits. At the prayer of the learned Advocate for the Respondent the operation of this order shall remain stayed for eight weeks and a plain copy of the order is made available to him on assurance that he will apply for a certified copy of this judgment and which when applied for must be granted to him by the office as expeditiously as possible.

S.P. Rajkhowa, J.

I agree.