Allowed

Manmohan Singh v. Central Bank of India

Punjab & Haryana HC19 Jul 2011CWP/12613/1999

Case brief

AI extract

What is this about?

Petitioner, a deposit collector, sought reinstatement after termination without notice. Judge held termination clause inoperative as petitioner was a workman under ID Act. Denied reinstatement due to time lapse but awarded substitutional compensation.

What did the court decide?

Compensation of 4,00,000/- awarded with interest at 6% p.a. from date of order.

Manmohan Singh Vs Central Bank of… — Contract and Commercial Disputes | Punjab & Haryana HC (2011)

¶1

CWP No. 12613 of 1999

¶2

¶3

IN THE HIGH COURT OF PUNJAB & HARYANA, CHANDIGARH

¶4

CWP No. 12613 of 1999 Date of decision July 19 , 2011

¶5

Manmohan Singh

¶6

....... Petitioner

¶7

Versus

¶8

Central Bank of India and others

¶9

........Respondents

¶10

CORAM:

¶11

HON'BLE MR. JUSTICE K. KANNAN

¶12

Present:Mr. Vikas Bali, Advocate for the petitioner.

¶13

Mr. Jatinder Nagpal , Advocate for Mr. O. P. Nagpal, Advocate for the respondents.

¶14

¶15

Whether reporters of local papers may be allowed to see the judgment ? No

¶16

To be referred to the reporters or not? Yes

¶17

Whether the judgment should be reported in the digest?Yes

¶18

K. Kannan, J (oral).

¶19

The petitioner who was a deposit collector engaged with the respondent bank since October 1978 was terminated from his services in the year 1998. He did not come through any specific order of termination but his services were not utilized and he was not permitted to work with the respondent as a Collection Agent. The petitioner would contend that his credentials were never in doubt and as a matter of fact in a letter of communication dated 28.10.1998 by the Senior Manager of the Bank to his Zonal Office, it was specifically observed that the reintroduction of the deposit collector's services would bring a lot of clientale and they shall be permitted to allow the petitioner to resume work

¶20

CWP No. 12613 of 1999

¶21

¶22

of collection whose agency had still not been suspended. It was only in the reply filed before this Court in response to the petition that it was stated that he had not been permitted to resume duty and his agency was terminated from April, 1999.

¶23

The counsel appearing for the Bank would contend that the petitioner was employed as an agent through an agreement entered into by the petitioner with the Bank on 30.8.1980 and the agreement provided for the termination of the agency at the discretion of the bank without any notice through clause 1 in the agreement and that it further provided through clause 14 that the termination could be effected without assigning any reason. The clause also provided that the Collection Agent shall not be entitled to raise any dispute as to whether the termination was lawful or not. The Bank would therefore contend that no action is possible before this Court to accommodate the prayer for resuming the agency or to give a positive direction for renewing the agency in favour of the petitioner.

¶24

The status of the Collection Agency came to be considered by the Hon'ble Supreme Court in Indian Bank Association Vs. Workmen of Syndicate Bank in (2001) 3 SCC 36 where the Industrial Tribunal had originally directed absorption to persons who were less than 45 years of age and also granted gratuity and full backwages in respect of persons who are above 45 years. This direction of the Tribunal in the appeal to the High Court stood modified to vacate the direction for absorption and restricted the claim only for backwages, conveyance allowance, gratuity etc. In the further appeal by the Bank's Association, the Hon'ble Supreme Court held that there was a control of Banks on these classes of workmen and affirmed a finding of fact that there was a relationship of master and servant. The Hon'ble Supreme Court further observed that deposit Clerks were not regular employees of the Bank and

¶25

CWP No. 12613 of 1999

¶26

¶27

they were not in any way prevented from doing other works and earn a living for themselves. Notwithstanding the scope of such other employment for the Deposit Clerks, the Court held that they were nevertheless “workmen” as defined under the Industrial Disputes Act, 1947. It found that there was a clear relationship of master and servant between the Deposit Clerks and the concerned bank and affirmed the decisions of the High Court awarding backwages, gratuity and other allowances.

¶28

Although, I have not the benefit of any particular oral evidence adduced with reference to the work which the petitioner was turning out for the Bank, it is brought through several communications that the Bank had reminded the petitioner to immediately report for duty on every occasion he was absent. By a letter dated 6.4.1994 the Bank had stated that he was not turning up at the Bank from 4.4.1994 and that he should visit the Branch immediately not later than 24 hours. This letter would show that even a day's absence mattered to the Bank and they wanted to ensure that no amount that was collected by the Agent was retained by him without being remitted to the Bank. Again on 9.12.1994, the complaint was that the petitioner was not visiting the bank 10-12 days and on 22.2.1996 the Bank has stated that the petitioner was absent from Ist January, 1996 to 16.3.1996 and the petitioner had been reminded that he should visit the Bank daily to deposit the amounts collected from the customers. These communications are relied on by the Bank to show that the Bank was not happy about the conduct of the petitioner. Counsel for the petitioner would however, contend that these letters merely referred to temporary absences and none of the communications culminated in termination of the Agency itself. The petitioner would therefore rely on how the communication dated 28.10.1998 from the Senior Manager to the Zonal Office contained an acknowledgment of the petitioner's credibility and the respondents recommendations that his services should be retained.

¶29

CWP No. 12613 of 1999

¶30

¶31

An Agency is terminable at will if there exists no interest in the subject matter of Agency. Section 202 of the Contract Act refers to an Agency which is coupled with interest and protects against unilateral termination of an agency who has an interest. The interest could be even minimal as in this case, the petitioner as an agent was entitled to a remuneration of 2% of the collections which he was making. The reliance on the provisions under the agreement allowing for termination without notice or the agent's undertaking not to dispute any action of the Bank cannot therefore avail and they must only be taken as inoperative, being oppressive and what is perceived by Courts in some of the cases, as Henry VIII clause. There could be no doubt that if the status of the petitioner as an agent would still be seen under the particular facts as in the position of a master and servant, the termination summarily without affording to the petitioner the protection which the Industrial Disputes Act, 1947 would provide, shall entitle the petitioner to contend that the termination was not valid in law.

¶32

The only question would be, whether the petitioner would be entitled to a direction for resumption of the agency and for payment of all the wages which he had been denied. In my view, from the time when the case was instituted to the time when the case is being taken up, more than a decade has passed and there shall be no justice in directing the Bank to force the reemployment of the petitioner as an agent. Indeed, even the decision in Indian Bank Association's case (supra) only provides for upholding of the direction of the High Court for past wages, gratuity and transport allowances etc. The petitioner has given the details of the payments which he has received from the Bank from the year 1978 till February, 1996. The income has gradually increased from 648/to start with for two months to about 50,000/- annually in the year 1995. The tabulation of the details is reproduced to assess the extent of loss that

¶33

CWP No. 12613 of 1999

¶34

¶35

was occasioned to him by the termination which was not in accordance with law.

¶36

*Year*	*No. of* *days*	*Collectio* *n per* *day*	*Total Collection* *(approx.) (*`)	*Total* *(earning/commission* *@ 2% given by bank* *on total collection in* *approx. (*`)
10.10.1978			32,400/-	648/-
to
31.12.1978	81	400
1979	365	800	2.92,00/-	5,840/-
1980	365	1200	4,38,000/-	8,760/-
1981	365	1600	5,84,000/-	11,680/-
1982	365	2000	6,57,000/-	13,140/-
1983	365	2400	7,30,000/-	14,600/-
1984	365	2400	8,76,000/-	17,520/-
1985	365	2600	9,49,000/-	18,980/-
1986	365	2800	10,22,000/-	20,440/-
1987	365	3000	10,95,000/-	21,900/-
1988	365	4000	14,60,000/-	29,200/-
1989	365	4500	16,42,500/-	32,850/-
1990	365	4800	17,52,000/-	35,040/-
1991	365	5000	18,25,000/-	36,500/-
1992	365	5600	20,44,000/-	40,880/-
1993	365	5800	21,17,000/-	42,340/-
1994	365	6200	22,63,000/-	45,260/-
1995	365	6800	24,82,000/-	49,640/-
1.1.1996 to 6.2.1996	365	7100	2,20,100/-	4,402/-

¶37

He had worked for at least 17 years in full and the form of termination as found expressed in the reply came about three years later. Going by the average income earned in the last year of his effective work, I am of the view that the appropriate compensation that could be granted to him would be `4,00,000/- (50% of annual wages x No. of years of service) to fulfill all claims in lieu of the services which he demands by the petition. The amount of compensation is for the unlawful termination of services in the manner done. The same shall be paid by the respondents

¶38

CWP No. 12613 of 1999

¶39

¶40

within a period of eight weeks from the date of receipt of copy of the order failing which the amount shall attract interest at the rate of 6% from the

¶41

date of this order till the date of payment.

¶42

The writ petition is disposed of as above.

¶43

(K. KANNAN) JUDGE

¶44

July 19, 2011 archana

Manmohan Singh v. Central Bank of India

Case brief

What is this about?

What did the court decide?

Manmohan Singh v. Central Bank of India

Case brief

What is this about?

What did the court decide?

What the court decided

A compact analysis

Issues for consideration

Cases cited

Statutes considered

Parties & counsel

Coram

Case details

Similar cases

Arjan Singh Vs UOI and Anr.

M/S Ssb Enterprises Vs State of Punjab and Anr.

Ishwar Singh and Anr. Vs State of Haryana and Ors.

Nasib Singh Vs State of Punjab and Ors.

Man Singh & Ors. Vs State of Haryana & Ors.

Harvinder Kaur Vs Jugraj Singh