Ramesh Kumar Sharma v. The Ambassador, Royal Netherlands Embassy New Delhi And Another

Manmohan Sarin, J.— By this order, defendant's application under Order VII Rule 11 read with Section 151 CPC for rejection of the plaint is being disposed of.

The plaintiff's suit is for a decree against the defendant, for reinstatement of the plaintiff in the service of the Embassy with retrospective effect with full back wages and consequential benefits. In the alternative, plaintiff prays for a decree in the sum of Rs. 30,00,000/- (Rs. Thirty lacs only) against the defendant together with interest @ 24% per annum from the date of the institution of the suit.

2. The present suit has been instituted by the plaintiff after the Ministry of External Affairs, Union of India had granted permission under section 86 of the cpc on 10.2.1998, for institution of the suit. The plaintiff has earlier filed a writ petition bearing CW No. 2643/91, which was disposed of by this Court vide orders dated 13.11.1997, directing the Ministry of External Affairs, UOI to consider the plaintiff's prayer for permission to sue the defendant and pass a reasoned order.

3. The facts of the present case leading to the filing of the suit and the application under Order VII Rule 11 CPC insofar as they are relevant for the purposes of disposal of the present application may be briefly noted:

(i) The plaintiff was employed with Royal Netherlands Embassy in India defendant No. 1 herein, since 1971 and was last working as a Film Librarian in the Press and Cultural Department of defendant No. 1. Defendant No. 2 is the Government of Netherlands. The plaintiff as per the defendant was governed by the Dutch Civil Law and had been employed in accordance with Article 89 para 4 of the Regulations of Foreign Service 1951.

(ii) Plaintiff had taken leave to visit his home town, but failed to report back on duty, upon expiry of leave. Plaintiff sought extension of leave. It was granted for a lesser period than requested for. Plaintiff sought further extension of leave on ground of illness, claiming to be admitted in the Government primary health centre and expressing his inability to resume duty. The plaintiff was asked to report back latest by 10.8.1990 The plaintiff sought yet further extension upto 22.8.1990 In the event, the defendant, sent one of their employees Mr. Verma to trace the plaintiff, who is alleged to have found the plaintiff under the influence of alcohol.

(iii) It is not necessary for the purposes of disposal of the present application to go into the question of whether the plaintiff was genuinely sick or was feigning sickness. It is sufficient to notice that when the plaintiff reported back to duty on 16.8.1990, a show cause notice dated 24.8.1990 was issued to the plaintiff. The plaintiff of course made a representation but the defendant No. 1 confirmed the suspension. In the event, on 28.9.1990, the Ministry of Foreign Affairs, Government of Netherlands as per its rules and regulations issued an order of dismissal in pursuance to which the plaintiff was dismissed from service w.e.f 1.10.90 On 1.8.1991, the plaintiff filed an appeal before the Queen of Netherlands. The appeal redirected to the Ministry of Foreign Affairs, who on 1.7.1992, upheld the decision dated 28.8.1990 The plaintiff preferred an appeal against the order 1.7.1992, before the Appeals Committee. The Appeals Committee after considering the whole matter and the evidence, was of the view that the petitioner should have been “terminated” rather than being “dismissed”. The Appeals Committee recommended the quashing of the decisions dated 28.9.1990 and 1.7.1990 It held that the “ground of poor relations” did not constitute compelling reasons for dismissal. As regards the ground of absence without leave. Appeals Committee held that it had not been established that plaintiff was not unfit for work. No medical examination was got done after his return, The Committee therefore recommended that the plaintiff was entitled to compensation, which he would have received, if his employment had been terminated in a regular manner rather than dismissal.

(iv) The Ministry of Foreign Affairs accepted the report of the Appeals Committee and held that the plaintiff was entitled to 8 weeks' notice salary plus Rs. 3,000/- on account of interest. The “termination” in contradistinction to “dismissal” entitled the plaintiff to “compulsory pension” calculated at half month's salary for each six months of service put in by the plaintiff. This worked out to Rs. 64,057/- approx. The plaintiff was advised by the Foreign Ministry that against the aforesaid order of the Appeals Committee, he could prefer an appeal in the Hague District Court. The plaintiff preferred the appeal. The District Court held appeal to be not maintainable and inadmissible, since dispute with the defendant arose from an employment contract and the plaintiff was required to bring in action before the Civil Court in Netherlands rather than seek administrative relief in appeal before the Hague District Court. The plaintiff was also awarded costs of 555/- dutch gilders.

(v) The Ministry of Foreign Affairs, Government of Netherlands informed the plaintiff that it would arrange for the payment of compensation as well as costs as awarded vide its letter dated 22.8.1996 The plaintiff in response asked for deposit of the amount in his bank account together with interest @ 18% p.a The plaintiff withdrew the said amount without prejudice to his rights. in the meanwhile, as noted earlier writ petition bearing CW No. 2643/91, seeking permission to institute the suit against the defendant, had been disposed of by this Court directing the Ministry of External Affairs to reconsider the appeal after giving an opportunity of being heard to the plaintiff and pass a reasoned order in accordance with law. The said permission was granted on 10.2.1998

4. The plaintiff thereupon instituted the present suit on. 10.3.1998, claiming reinstatement in the alternative Rs. 30,00,000/- together with interest and costs.

5. I have heard learned Senior Advocate Mr. Ashok Desai, and Mr. D.S Narula, Advocate in support of the defendant application and Mr. Pawan Upad-hyay, counsel for the plaintiff in opposition. Counsel for the defendant challenges the maintainability of the suit and the prayer for rejection is made on the following grounds:

(i) The suit is barred since it has been filed without any legal or valid permission being granted by the Central Government under the provisions of Section 86 of the Code of Civil Procedure. The defendants submit that the conditions precedent for grant of permission under Section 86 CPC were altogether missing. Conditions as per Clauses (a) to (c) of sub-section (2) of Section 86 CPC were admittedly non-existent. There was factually no express or implied waiver of immunity or privilege to attract clause ‘d’. The permission granted was, therefore, non est and a nullity. Defendant urged that the said permission can be collaterally challenged in these proceedings.

(ii) The present suit is barred by the principles of res judicata. The plaintiff had duly agitated and challenged the order of dismissal by approaching the appropriate authorities in accordance with Dutch Law for redressal. It was treated as termination instead of dismissal. The termination or removal from service was upheld and Compensation was awarded, which had been duly received and accepted by the plaintiff though without prejudice. The plaintiff, therefore, cannot agitate the same grievance before this Court as the suit is barred by principles of res judicata.

6. Learned counsel for the parties had been heard at length and have also filed their written submissions in support of their respective contentions and propositions.

7. Learned counsel for the defendants, Mr. Ashok Desai, submitted that permission under Section 86 CPC has been granted contrary to the express provision. Ex facie ingredients of Section 86 CPC were not satisfied. The order granting permission does not record the reasons, despite the direction by a Division Bench in its judgment, while disposing of writ petition filed by the plaintiff. Reference is invited to the provisions of Section 86 (1) and (2) CPC, which are as under:—

‘86. Suits against foreign Rulers, Ambassadors and Envoys— (1) No Foreign State may be sued in any Court otherwise competent to try the suit except with the consent of the Central Government certified in writing by a Secretary to the Government;

Provided that a person may, as a tenant of immovable property sue without such consent as aforesaid a Foreign State from whom he holds or claims to hold the property.

(2) Such consent may be given with respect to a specified suit or to several specified suits or with respect to all suits of any specified class or classes, and may specify, in the case of any suit or class of suits, the Court in which the Foreign State may be sued, but it shall not be given, unless it appears to the Central Government that the foreign State—

(a) has instituted a suit in the Court against the person desiring to a sue it, or

(b) by itself or another, trades within the local limits of the jurisdiction of the Court, or

(c) is in possession of immovable property situate within those limits and is to be sued with reference to such property or for money charged thereon, or

(d) has expressly or impliedly waived the privilege accorded to it by this section.”

8. Learned counsel submitted that the case was not covered by clauses (a), (b) and (c) of sub-section (2) of Section 86. As regards sub-clause (d), the condition specified is that consent shall not be given unless Foreign State has expressly or impliedly waived the privilege. Learned counsel for defendants submitted that the contention of the plaintiff there being an implied waiver by Defendants, by virtue of the agreement of employment containing a provision for a limited application of local law, was manifestly untenable and wholly misconceived. In these circumstances, in the absence of satisfaction of Clause ‘d’ of sub-section (2), the consent could not have been given under Section 86 to the plaintiff. Learned counsel further submitted that the consent was given without hearing the defendant and in violation of principles of natural justice and hence it was non est. Further, the petitioner could challenge the same in these collateral proceedings. In support of this, reliance was placed by the learned counsel on Nawabkhan Ab-baskhan v. State of Gujarat, AIR 1974 Supreme Court 1471, Swadeshi Cotton Mills v. Union Of India, AIR 1981 Supreme Court 818, Ajudh Raj and others v. Moti s/o Mussadi (1991) 3 Supreme Court Cases 136 and East India Corporation Ltd. v. Shree Meenakshi Mills Ltd., (1991) 3 Supreme Court Cases 230. The defendants, therefore, assailed the permission under Section 86 CPC as non east and being a nullity.

9. It was contend on behalf of plaintiff that once consent under Section 86 CPC had been granted, a Foreign State could be sued in the Municipal Courts in India and the same could not be assailed under Order 7 Rule 11 (a) CPC. Learned counsel for plaintiff relied on Govindram Gordhandas Seksaria and another v. State of Gondal by His Highness the Maharaja of Gondal and others, AIR 1950 Privy Council 99, to urge that the consent once given could not be questioned before the Court and was binding.

10. The Privy Council itself recognised that there could be cases and special circumstances where the Court could go behind the certificate of consent issued. It observed “There might conceivably have been cases, as Kania, J. supposed in his judgment in which the certificate showed on the face of it that the Crown representative did not consider any of the necessary conditions of exist; or possibly special circumstances might have arisen entitling a Court to go behind a certificate and investigate the facts”. In the cited case under consideration the Privy Council had found that there was nothing to suggest the existence of any special circumstances. However, in the present case at hand, learned counsel for Defendant contended that non-existence of the circumstances under sub-sections (a) to (d) would result in a bar to the grant of consent.

11. Mr. Upadhya, learned counsel for the plaintiff, on the other hand, submitted that once the consent and permission under Section 86 CPC had been granted, it was not open to challenge and the Courts could not go behind the certificate granted. He further submitted that a collateral challenge was not permissible Relying on Bhairavasingh Malojirao Ghorpade and another v. Shankar Rao Bindu Rao Padaki and others, AIR 1976 Karnataka 164, learned counsel submits that once the consent had been obtained for institution of the suit, it was also consent for continuation of the suit. Learned counsel also urged that as per the service conditions of employment of the plaintiff; the remuneration of locally engaged assistants, who were not the nationals of Netherlands was to be determined on the local conditions of employment. Learned counsel urged that submissions to the jurisdiction of India/local laws by Netherlands Embassy, by virtue of the above contract, shall amount to implied waiver of the privilege/immunity under Section 86(2)(d) CPC. Learned counsel in this connection cited certain authorities with regard to waiver.

12. I am unable to accept submissions of the learned counsel for the plaintiff. The contract provided for application of Dutch Civil Law except for the limited purpose of determination of remuneration of locally engaged assistants. In any case, the choice of law does not per se excludes the jurisdiction. It is well settled and recognised principles of International Law that choice of law and jurisdiction may be of different States. In any case, a provision enabling the application of Indian local laws for a particular purpose, cannot be given an expanded meaning or interpretation that it amounts to waiver of the privilege under Section 86(2) CPC. There has to be an intentional abandonment of a right with the full knowledge of the rights to constitute waiver which are altogether missing in the instant case.

13. As regards the defendants' contention that the permission/consent under Section 86 CPC could be assailed in these circumstances collaterally since the same was void and nullity, I prima facie find merit in the submission since ex facie the condition under Section 86(2)(d) of their being an express or implied waiver has not been satisfied. Besides, as recognised in the Govindram Gordhandas Sek-saria and another (supra) by the Privy Council itself, normally the courts are not to go behind the certificate and investigate the facts. However, special circumstances may exist when the Courts could go behind the certificate. In the instant case, I find that it is not even necessary to go into, this question and the matter can be decided de hors the question of validity of the consent or permission under Section 86 CPC. This is because the present suit is barred by the principles of res judicata and the plaint is liable to be rejected under Order 7 Rule 11 (d) CPC, as hereinafter discussed.

14. The plaintiff seeks a decree of reinstatement and compensation of Rs. 30 lacs with interest, as prayed from the Embassy and the Government of Netherlands. Plaintiff claims that his services were illegally and wrongfully terminated and further that he is entitled to be compensated for the amount claimed keeping in mind his balance years of service and the amounts he would have earned and the loss suffered by him.

15. It is an admitted position that the plaintiff had taken recourse to legal remedies available under the Laws of Netherlands and had submitted his representation and thereafter appeal against the decision of the Ministry of Foreign Affairs to the Appeals Committed. It was in pursuance to the said legal remedies availed, that the “dismissal” of the plaintiff was recommended by the Appeals Committee to be treated as “termination”. This was accepted by Competent Authority. This enabled the plaintiff to receive compensation in the sum of Rs. 64,057 together with interest and costs of 555/- dutch gilders. Plaintiff was also held entitled to the salary for notice period of 8 weeks. The plaintiff upon being advised by the Deputy Head (Personnel) Management, Directorate, Ministry of Foreign Affairs with regard to the decision of payment of compulsory pension amount to Rs. 64,057.50, the plaintiff vide its letter of 4.10.1996 called upon them to make the entire payment with interest at the rate of 18% p.a as also 555 dutch gilders imposed as costs. Plaintiff asked them to make the payment in his saving bank account. The plaintiff added in the last para of the said communication stated as under:

“I trust that you will do the needful and arrange to make this payment with interest to my Saving Account No. 5705 situated in the Bank of Baroda, Yashwant Place, Chanakyapuri, New Delhi with intimation to me (without prejudice to my rights) and further delay.”

16. In these facts, learned counsel for the defendant has submitted that it is not open to the plaintiff to agitate his grievance regarding wrongful dismissal/termination of service and claim for compensation before the courts in India in the present suit. The plaintiff having approached the competent authorities under the Dutch Law, which was applicable to the service contract with the plaintiff, cannot now be permitted to reagitate his grievances and assert his claims by starting yet another round of litigation in the Courts in India. The use of expression “without prejudice” by the plaintiff, while accepting payment from the Dutch Authorities, can only be interpreted as to preserve the plaintiff's rights, as may be available to the plaintiff in law to agitate the matter further before the Dutch Courts or Authorities and not so as to permit the plaintiff with a right to institute the suit, which is barred by the principles of res judicata or to approbate or reprobate.

17. The doctrine of res judicata and of principles analogous thereto preclude the plaintiff from the relief of either reinstatement or recovery of damages since the prayer of the plaintiff for reinstatement has been declined by the competent Dutch authorities under Dutch Law and his termination upheld with grant of compulsory pension/compensation. The present suit would thus be barred by principles of res judicata. Reference is invited to Daryao and others v. State of U.P and others, AIR 1961 SC 1457. The Supreme Court repelled the argument that res judicata was a technical rule under the Civil Procedure Code and was thus irrelevant while deciding and considering the petition under Article 32. The Supreme Court observed as under:

“The rule of res judicata as indicated in Section 11 of the Code of Civil Procedure has no doubt some technical aspects, for instance the rule of constructive res judicata may be said to be technical but the basis on which the said rule rests is founded on considerations of public policy. It is in the interest of the public at large that a finality should attach to the binding decisions pronounced by Courts of competent jurisdiction, and it is also in the public interest that individuals should not be vexed twice over with the same kind of litigation.

18. The binding character of judgments pronounced by Courts of competent jurisdiction is itself an essential part of the rule of law, and the rule of law obviously is the basis of the administration of justice on which the Constitution lays so much emphasis. On general considerations of public policy there seems to be no reason why the rule of res judicata should be treated as inadmissible or irrelevant in dealing with petitions filed under Article 32 of the Constitution. It is true that the general rule can be invoked only in cases where a dispute between the parties has been referred to a Court of competent jurisdiction there has been a contest between the parties before the Court, a fair opportunity has been given to both of them to prove their case, and at the end the court has pronounced its judgment or decision. Such a decision pronounced by a Court of competent jurisdiction is binding between the parties unless it is modified or reversed by adopting a procedure prescribed by the Constitution”.

Reference is also invited to the decision of the Supreme Court in Lalchand (dead) by L.Rs and others v. Radha Kishan, AIR 1977 Supreme Court 789. The respondent in the cited case instituted a suit for eviction of the appellant from the premises. Respondent had earlier sought permission for the said relief under the Slum Clearance Act, which was denied to him. The subsequent suit filed by the respondent was held to be barred by principles of res Judicata. The Supreme Court observed as under:

“The fact that Section 11 of the Code of Civil Procedure cannot apply on its terms, the earlier proceeding before the competent authority not being a suit, is no answer to the extension of the principle underlying that section to the instant case. Section 11, it is long since settled, is not exhaustive and the principle which motivates that section can be extended to cases which do not fall strictly within the letter of the law. The issues involved in the two proceedings are identical, those issues arise as between the same parties and thirdly, the issue now sought to be raised was decided finally by a competent quasi-judicial tribunal. The principle of res judicata is conceived in the larger public interest which requires that all litigation must, sooner than later, come to an end. The principle is also founded on equity, justice and good conscience which require that a party which has once succeeded on an issue should not be permitted to be harassed by a multiplicity of proceedings involving determination of the same issue.”

19. From the foregoing authorities, it would be seen that the doctrine of res judicata is founded and based on rule of public policy and larger public interest. The rationale being that there should be a finality to a decision of a court of competent jurisdiction and the parties are not vexed twice over litigation on the same issues, the rule and principle of res judicata is extended to writ petition and similar petitions. The rule of res judicata is founded on the public policy of binding nature of the decision of a dispute where both sides have had a fair hearing and opportunity to prove their case. It is also not material whether previously instituted proceedings were in the nature of a suit or were other proceedings before a Tribunal. In the instant case it is not in dispute that proceedings had been instituted by the plaintiff before the competent authorities in Netherlands under Dutch Law on the same cause of action and facts. The plaintiff availed of his opportunities to present his case and obtained relief. Having obtained judgment and part relief as given by the competent authorities under Dutch Law, it is not open to the petitioner to reagitate the same grievances by filing the present suit for damages and claim compensation.

20. I, therefore, hold that the present suit is barred by principles of res judicata and the plaint is liable to be rejected under Order 7 Rule 11 (d) CPC. Accordingly, application being IA. No. 11421/98 is allowed and the plaint is rejected. The file be consigned to record room.