LexPYARE LAL SHARMA versus MANAGING DIRECTOR, JAMMU & KASHMIR INDUSTRIES LTD. & ORS. & VICE VERSA.
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A B PYARE LAL SHARMA v. MANAGING DIRECTOR, JAMMU & KASHMIR INDUSTRIES LTD. & ORS. & VICE VERSA. JULY 19, 1989 [MURARI MOHON DUTT AND KULDIP SINGH, JJ.] +- Jammu & Kashmir Industries Employees Service Rules & Regulations-R. 16.14-Termination of service-Provision of show cause notice'sufficient safeguard against arbitrary action-Held regula- ~. - C tion not arbitrary. 1 Regulation 16.14-Termination of service-Ground (a) & (b)- ~ Three months notice or pay in lieu thereof. Amended Regulation- grounds (c) & (d) unauthorised absence and taking part in politics-15 days notice required-No requirement of any other notice or pay in D lieu thereof: Show cause for the period prior to amendment-Held amended regulation not operative retrospectively and the notice served on the employee was illegal and the order of termination had to be set aside. Also held termination on the basis of taking part in politics not maintainable as no show cause given. E Constitution of India 1951)-Article 311( 1) Employees of the com- pany not civil servants-Cannot claim protection of Art. 311(1) of the Constitution of India nor the extension of that guarantee on parity- Employees governed by the provisions of Articles of Association and Regulations of the Company. F Natural Justice-Principle-No one can be penalised for the action which was not penal on the day it was committed. Delegated authority acquires the power ofappointing authority- Held M.D. who had been delegated the powers of the Board of Directors was legally competent to terminate the services of the G employee. According to the Regulation 16.14 Of the Jammu & Kashmir Industries Employees Service Roles & Regola'tioos the services of the 'r' permanent employee could be terminated if the posl'is ·abolished ot he is declared medically uiifit after giving three month's ·notice or pay in lien H -thereof and in case oftemjlOrary employee·oue month's ·notice or paylin 428 P.L. SHARMA v. J. & K. INDUSTRIES 429 lieu thereof. This regulation was amended on April 20, 1983 by adding two more grounds namely, if the employee remains on an unauthorised absence or if he takes part in active politics, in such cases the services shall be terminated if he fails to explain his conduct satisfactorily within 15 days from the date of issue of notice and the management shall be empowered to take a decision without resorting to further enquiries. Pyare Lal Sharma was employed as a Chemical Engineer by the Jammu & Kashmir Industries Ltd. hereinafter called 'Com11any'. The Company issued a show cause notice on 21.4.83 in terms of the added clauses for his unauthorised absence from duty. As no reply was sub- mitted, the M.D. terminated his services by an order dated 14.6.1983. Sharma challenged the order of termination by way of a writ petition before the J & K High Court. Learned Single Judge allowed the Writ Petition on three grounds namely, violation of Rules of Natural Justice, that the Board of Directors having appointed Sharma, the M.D. who is subordinate authority could not terminate his services and that the regulation 16.14 was arbitrary and violative of Art. 14 of the Constitu- tion of India. The Letters Patent Bench of the High Court dismissed the appeal of the Company but denied backwages to Sharma. Aggrieved by that order both the Company as well as Sharma came up in appeals before this court. While allowing the appeal of Sharma partially and dismissing the appeal of the Company, this Court, HELD: That Regulation 16.14 was not arbitrary. The provision of show cause notice is a sufficient safeguard against arbitrary action. Under grounds (a) & (b) of the Regulations three months notice or pay in lieu thereof is required. Regarding grounds (c) & (d) the regulations provide for IS days notice to explain the conduct satis- factorily and there is no requirement of any other notice or pay in lieu thereof. [437C-D] There is no provision in the Articles of Association or the regulations of the company giving same protection to the employees of the company as is given to the civil servants under Art. 3ll(l) of the Constitution of India. An employee of the Company cannot, therefore, claim that he cannot be dismissed or removed by an authority subordinate to that by which he was appointed. Since on the date of termination of Sharma's services the M.D. had the powers of the appointing authority he was legally compeient to terminate Sharma's
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