LexCENTRAL INLAND WATER TRANSPORT CORPORATION LTD. & ANR. ETC. versus BROJO NATH GANGULY & ANR.
Open in Lexace · Ask the AI about this caseJudgment (excerpt)
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CEN'lKAL INLAND WATER. 'IIANSPORT
<DPOIATIOH LTD. & UL ETC.
_._
v.
BIIDJO NA11I GANGULY & .ANL
APRIL 6, 1.986
[A.P.SEN AND D.P. MADON, JJ.]
A. Constitution of India, 1950, Article 12 -
"State ..
whether a Government company as defined in section 617 of the
Indian Companies Act, 1956, is "the State" within the meaning
of Article 12 of the Constitution."
·{·
B.
Words
and
phrases
"Unconscionable
bargain",..(
"distributive justice,
reasonableness
and fair play"
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Meaning of -
Constitution of India, Articles 14, 38 and 39
read with sections 16, 19A of the Indian Contracts Act, 1872.
c. Contract of Employment - Whether an unconscionable
term in a contract of employment is void under section 23 of
the Indian Contract Act, 1872, as being opposed to public
policy and, when such a term is contained in a contract of}'--
employment entered into with the Government company, is also
void as infringing Article 14 of the Constitution in case a
Government company is "the State" under Article 12 of the
Constitution.
D.
The
Central
Inland Water Transport
Corporatiorr-t"'
Limited
(A
Government of India Undertaking)
-
Service,
Discipline and Appeal -Rules, 1979, Rule 9(1) Validity of --~
Whether the said provision is discriminatory and violates .
Article 14 of the Constitution and also void under section 16
of the Contract Act as opposed to public policy under section
23 ibid.
The Central Inland Water Transport CorpOration which was
incorporated on February 22, 1967 is a company owned by the
Government of India and the State Governments of West Bengal)..../
and Assam. It is a Government company within the meaning of
section 617 of the Companies Act, 1956. The Memorandum of
~sociation and the Articles of Association of the said
C.I.W.T.CORPN. v. B.N. GANGULY
279
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~corporation indicate that the corporation is under the
complete control and management of the Central Government
though all the shares
were and are owned by the Central
Government and the two State Governments. A company called
"Rivers Steam Navigation Company Limited" which was carrying
on very much the same business including the maintenance and
rUlUling of river service as the corporation is doing was
.. i ordered to be wound up by an order dated May 5, 1967 passed by
the Calcutta High Court and upon payment to all the creditors
it came to be dissolved. By a scheme of Arrangement approved
-
by the High Court and entered into between the said dissolved
company and the corporation the assets and certain liabilities
of the said company was taken over by the corporation. The
,,
-'\ Scheme of Arrangement provided as follows :
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(a) that the new company shall take as many of the
existing staff or labour as possible and as c:an be reasonably
taken over by the said transferee company subject to any valid
objection to any individual employee or employees;
(b) that as to exactly how many can be employed it is
left to the said transferee company's bonafide discretion;
(c) ·that those employees who cannot be taken over shall
be paid by the transferor company all moneys due to them under
the law and all legitimate and legal compensations payable to
them either under Industrial Disputes Act or otherwise legally
admissible and that such moneys shall be provided by the
-;.Government of India to the existing transferor company who
will pay these dues.
Brojo Nath Ganguly the first respondent in Civil Appeal
No. 4412 of 1985 was at the date when the said scheme of
arrangement became effective, working in the said company and
his services were taken over by the Corporation and he was
appointed on September 8, 1967 as a· Deputy Chief Accounts
Officer. Tarun Kanti Sengupta, the first respondent in Civil
Appeal No. 4413 of 1985 was also working in the said company
-v,;,.._.( and his services were also taken over by the Corporation and
he was appointed on September 8, 1967 as Chief Engineer on the
ship "River Ganga
11 Letters of appointment issued to both these
respondents provided that they would be subject to the service
rules and regulations including the conduct rules to be framed
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SUPREME COURT REPORTS
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[ 1986] 2 S. C. R.
by the Corporation.
Service rules were
framed
by
the .....l-
Corporation for the first time in 1970 and were replaced by
new rules in 1979 known as "The Central Inland Water Transport
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