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Md. Abdur Rahim v. Sub-Divisional Officer, Alipore Sadar, And Others

Calcutta High Court
Jul 22, 1992
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Structured Summary of the Opinion (Yusuf, J.)

Factual and Procedural Background

The appellant joined as a Tahsildar on 13 January 1971 after executing an agreement which specified that his service would be governed by the Government Servants' Conduct Rules and the West Bengal Services (Classification, Control and Appeal) Rules, 1971. By an order dated 24 December 1977 the Sub-Divisional Officer, Alipur Sadar, terminated the appellant's service with effect from 1 January 1978 under Clause (11) of that agreement.

The charges listed in the opinion were: (i) manipulation of false signatures, which the appellant admitted in writing; (ii) involvement in manipulating forged mutation orders, under investigation in Bhangar Police Station Case No. 21 of 1978; and (iii) fabrication of another Tahsildar's signature on rent receipts.

The appellant refuted the allegations generally, produced a certificate from the District Enforcement Officer stating he was not wanted in connection with the Bhangar police case, but admitted that in the absence of Tahsildar Islam Ali Mollah he had signed dakhilas in Islam Ali Mollah's name to collect rents and deposited amounts in the bank in that name; he also admitted issuing two dakhilas in that name for Rs. 261.05 which were not fully deposited and tendered an apology.

The State-respondents asserted that the appellant's representations were rejected after proper consideration and an opportunity to be heard, that a departmental enquiry followed in which he was found guilty, and that they had the right under Clauses (2) and (11) of the agreement to terminate his service. Procedurally, this appeal challenges a Single Judge's judgment and order dated 3 July 1986 which discharged the rule; Yusuf, J. authored the judgment summarized here and S.P. Rujkhowa, J. agreed.

Legal Issues Presented

  1. Whether the appellant was validly removed from service in accordance with law, and whether the charges against him were proved before removal.
  2. Whether Clause (11) of the employment agreement, which permits termination without prior notice or enquiry and makes the Government's decision final, is legally valid given that Clause (4)(e) provides governance by Government Servants' Conduct Rules and the West Bengal Services (Classification, Control and Appeal) Rules, 1971.
  3. Whether Clause (11) is contrary to Article 14 of the Constitution and Section 23 of the Indian Contract Act (i.e., whether it is an unfair, unreasonable or unconscionable clause and therefore void as against public policy).

Arguments of the Parties

Appellant's Arguments

  • The termination by the Sub-Divisional Officer was contrary to established law; the appellant's removal should be subject to legal safeguards and proper procedure rather than summary application of Clause (11).
  • Counsel relied on the West Bengal Land Management Manual, 1977 (Ch. II, rules 15–25), particularly Rule 25 (suspension and subsistence grant), to show relevant service procedures and protections for a Tahsildar.
  • Counsel cited Supreme Court decisions (discussed in the opinion) to contend that Clause (11)-type provisions are unfair, unconscionable and contrary to Article 14 and public policy, and that charges should be proved through departmental enquiry before dismissal.
  • The appellant contended that Clauses (2) and (11) could not operate in the face of Clause (4)(e) which subjects the post to statutory service rules.

Respondents' Arguments

  • The State-respondents asserted that the appellant's representations were considered after affording opportunity of being heard.
  • They asserted that a departmental enquiry was held and that the appellant was found guilty.
  • The respondents relied on Clauses (2) and (11) of the agreement as the contractual basis for termination and contended they acted within their rights under the agreement.

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
Central Inland Water Transport Corporation, Ltd. v. Brojo Nath Ganguly [1986 — II L.L.N 382] The Supreme Court held that a clause similar to Clause (11) was ultra vires Article 14, violative of Directive Principles (Arts. 39(a) and 41), and void under Section 23 of the Contract Act as opposed to public policy; it condemned clauses that give unfettered power to dismiss without meaningful bargaining power for the weaker party. The court treated Brojo Nath as directly applicable and held that the agreement's Clause (11) was "directly hit" by that decision; concluded Clause (11) is contrary to S.23 of the Contract Act and ultra vires Article 14.
Delhi Transport Corporation v. Delhi Transport Corporation Mazdoor Congress [1991 — I L.L.N 613] A majority (4:1) judgment further condemned arbitrary or "Henry VIII" service rules; emphasised the need for well-defined and explicit service conditions and rejected arbitrary rules in service conditions. The court relied on the majority view to strengthen the position that arbitrary clauses like Clause (11) have no place in service conditions and affirmed the reasoning in Brojo Nath; K. Ramaswamy, J. (para. 282) specifically held Brojo Nath's ratio required no reconsideration.
Kumari Shrilekha Vidyarthi v. State of Uttar Pradesh [(1991) 1 SCC 212] The Supreme Court held that State action regarding government posts carries a public element and is not purely contractual; arbitrary, unreasonable or irrational State action (e.g., termination) attracts Article 14. The court cited this decision to support the view that termination of appointment by the State cannot be treated as purely contractual and that Article 14 is attracted where State action is arbitrary—reinforcing invalidity of Clause (11).

Court's Reasoning and Analysis

The court began by focusing not on the merits of the charges but on whether the appellant had been validly removed in accordance with law and whether Clause (11) of the agreement could stand judicial scrutiny in light of Clause (4)(e) which subjects the post to the Government Servants' Conduct Rules and the West Bengal Services (Classification, Control and Appeal) Rules, 1971.

The court analysed Clause (11) and found that it conferred an arbitrary, unfettered power on the Government to discharge an employee without prior notice or opportunity to be heard, and to make the Government's decision final and binding. The court identified this as the same vice condemned in Brojo Nath (where a similar rule was held ultra vires Article 14 and void under Section 23 of the Contract Act) and reinforced by the Delhi Transport Corporation majority judgment and by Kumari Shrilekha Vidyarthi.

Relying on these precedents, and on the inequality of bargaining power between the State and the individual appointee (a Tahsildar who had no real choice but to sign a standard form), the court held that Clause (11) was arbitrary, contrary to public policy, and thus invalid. The court emphasised that even if a post is governed by contractual terms, the public element attached to government employment means arbitrary termination without departmental inquiry would attract Article 14.

The court then stated the necessary procedural consequence: a person cannot be removed from service under Clause (11) without a departmental proceeding with a proper enquiry where the employee is allowed to adduce evidence and make a proper defence. The court therefore quashed the termination order and set aside the Single Judge's prior judgment.

Holding and Implications

Holding: The appeal is allowed. The court quashed Order No. 5716 dated 24 December 1977 terminating the appellant's services and set aside the Single Judge's judgment of 3 July 1986. The appellant is reinstated as Tahsildar with effect from 1 January 1978 and is to be absorbed and designated as Bhumi Sahayak with effect from 1 July 1984 in accordance with the Board of Revenue notification dated 25 February 1988 and other relevant orders.

Specific directions and direct effects on the parties:

  • The respondents (including the Secretary, Land and Land Utilisation and Land Reforms Department and the Board of Revenue) are directed to implement the order within 30 days of communication.
  • The appellant shall be paid all arrears due from 1 January 1978 within three months of communication of the order.
  • There shall be no break in service.
  • The appeal was allowed and there was no order as to costs.
  • A xerox copy of the order is to be made available to the appellant upon usual undertaking and compliance with formalities.

Implications for law: The court applied and followed existing Supreme Court precedents that condemn contractual clauses permitting summary dismissal without procedural safeguards. The decision declares Clause (11) of the agreement void as contrary to Section 23 of the Contract Act and ultra vires Article 14 of the Constitution. The opinion does not announce a novel legal principle beyond the application of these cited authorities.

Show all summary ...

Yusuf, J.:— This appeal has been preferred against the judgment and order, dated 3 July, 1986, passed by a learned Single Judge discharging the rule. The case of the writ-petitioner, inter alia, is that he joined as a Tahsildar on 13 January, 1971 after executing an agreement and in terms of the said agreement the appellant's service is governed by the Government Servants' Conduct Rules and the West Bengal Services (Classification, Control and Appeal) Rules, 1971. The Sub-Divisional Officer, Alipur Sadar, by an order, dated 24 December, 1977, terminated the petitioner/appellant's service with effect from 1 January, 1978 in terms of Cl. (11) of the said agreement. His grievance is that his services were terminated without affording him any opportunity to show cause and without giving him any opportunity of hearing or conducting any departmental enquiry into his conduct. The charge against him is:

(i) manipulation of false signatures which he admitted in writing;

(ii) he was involved in manipulating some forged mutation orders which is under investigation in Bhangar Police Station Case No. 21 of 1978; and

(iii) he fabricated false signatures of another Tahsildar on some rent receipt.

2. The allegations made against the appellant are refuted by him and he in his affidavit-in-reply annexed a certificate from the District Enforcement Officer, Bhangar Zone, 24-Parganas, that he was not wanted in connection with Bhangar Police Station Case No. 21 of 1978. But the appellant admitted that in the absence of the Tahsildar Islam Ali Mollah he had collected rents on his behalf by signing his name in the dakhilas and deposited the amounts so collected in the bank in the name of Islam Ali Mollah. The appellant further submitted that he also granted two dakhilas in the name of Islam Ali Mollah for collecting a sum of Rs. 261.05, but he did not deposit the amount since it was collected in part. He tendered apology for the same.

3. The State-respondents maintained that the appellant's representation were rejected after proper consideration and after giving him an opportunity of being heard. The State-respondents also states that a departmental enquiry followed and he was found guilty. The respondents have relied in their affidavit-in-opposition that they have right under Cls. (2) and (11) of the agreement to terminate the service of a Tahsildar and they have done so in accordance with law.

4. Sri Dutt, learned advocate appearing for the writ-petitioner/appellant, has submitted that the very action of the Sub-Divisional Officcr, Alipur Sadar, terminating the service of the appellant is contrary to the well-established law of the land. The question of going into what he did or did not will be considered not now. But the first point for consideration is whether the appellant has been rightly removed from service in accordance with law or whether the charges were proved against him or he was sacked contrary to law. In this connection, he cited the West Bengal Land Management Manual, 1977, with particular reference to Chap. II thereof from rules 15 to 25 which relate to Tahsildar's functions, remunerations and conditions of service. Rule 25 in particular relates to suspension and the subsistence grant relating thereto. He also cited a number of decisions of the Supreme Court in support of his contentions which are convincingly in favour of the appellant and shall be discussed hereinafter. We are not going into the charges levelled against the appellant. But first we go whether in the face of those charges which were not proved beyond doubt through a departmental enquiry, whether it was proper on the part of the authority concerned to terminate the service of the appellant and also we are to examine whether Cl. (11) of the agreement stands a judicial test. When a Tahsildar according to Cl. (4)(e) of the agreement is to be governed by the Government Servants' Conduct Rules and also by the West Bengal Services (Classification, Control and Appeal) Rules, 1971, then how Cls. (2) and (11) of the said agreement can be applicable on the face of Cl. (4)(e). More so Cl. (11) is quite arbitrary and against the principles of natural justice giving the Government unlimited power to dismiss the Tahsildars at whim. The said Cl. (11) is quoted hereunder:

“That the Government shall have the right and be entitled to discharge the employee or terminate his agreement without any previous notice if the employee commits any breach of any of the terms and conditions herein contained or he is found to be otherwise negligent or inefficient or his work is found to be otherwise unsatisfactory and the decision of the Government in that respect shall be final and binding.”

5. This particular clause, as stated above, gives unlimited power to an officer to take any action against the Tahsildar in accordance with his sweet will without any previous intimation to him of any breach he has committed. Such an arbitrary power of discharge from service of a Government employee has been condemned by the Supreme Court in several decisions. The foremost decision on the point is that of Central Inland Water Transport Corporation, Ltd. v. Brojo Nath Ganguly [1986 — II L.L.N 382], where the Supreme Court in words categorically held as ultra vires Art. 14 of the Constitution and violative of Directive Principles as contained in Art. 39 (a) and Art. 41 of the Constitution and also void under S. 23 of the Contract Act as being opposed to public policy, the much maligned rule 9(i) of the Service, Discipline and Appeal Rules, 1979 of the Central Inland Water Transport Corporation, Ltd. Rule 9(i) was almost similar to Cl. (11) of the agreement in the instant case of the appellant relating to Tahsidars. The principle underline in Cl. 11 has been condemned by the Supreme Court in the aforesaid decision as unfair and unreasonable contract with a clause entered into between the parties who are not equal in bargaining power. The Supreme Court says that the Court should strike down an unfair and unreasonable contract, or an unfair and unreasonable clause in a contract, entered into between parties who are not equal in bargaining power where the inequality of bargaining power is the result of the great disparity in the economic strength of the contracting parties. It will apply to situations in which the weaker party is in a position in which he can obtain goods or services or means of livelihood only upon the terms imposed by the stronger party or go without them. The Supreme Court held that it would also apply where a man has no choice, or rather no meaningful choice, but to give his assent to a contract or to sign on the dotted line in a prescribed or standard form or to accept a set of rules as part of the contract, however unfair, unreasonable and unconscionable a clause in that contract or form or rules might be. The Supreme Court held that they are opposed to public policy and require to be adjudged void. In this particular decision which must be treated as a landmark decision of the Supreme Court. Thier Lordships further observed that in deciding any case which may not be covered by any authority, Courts have before them the beacon light of the preamble to the Constitution. Lacking precedent, the Court can always be guided by that light and the principles underlying the Fundamental Rights and the Directive Principles enshrined in the Constitution.

6. The abovementioned decision of the Supreme Court was further strengthened by a five-Bench 4 to verdict in the case of Delhi Transport Corporation v. Delhi Transport Corporation Mazdoor Congress [1991 — I L.L.N 613]. In this majority judgment, P.B Sawant, J., went a step further and said:

“Both the society and the individual employees, therefore, have an anxious interest in service conditions being well defined and explicit to the extent possible. The arbitrary rules which are also sometimes described as Henry VIII Rules, can have no place in any service conditions.”

7. Further, as referred to earlier, in Para. 282 of the Delhi Transport Corporation case, K. Ramaswamy, J., held specifically as under:

“Accordingly I hold that the ratio in Brojo Nath case [1986 — II L.L.N 382] (vide supra), was correctly laid and required no reconsideration.”

8. In this connection, another decision of the Supreme Court goes in favour of the appellant which is Kumari Shrilekha Vidyarth v. State of Uttar Pradesh [(1991) 1 SCC 212]. Here the Supreme Court again said that any State action in respect of a Government post should not be treated purely contractual but public element is attached to it. In case of the Government's arbitrary, unreasonable or irrational State action, i.e, termination of appointment, Art. 14 of the Constitution is attracted. We do not think that any further decision is required so far as this matter is concerned.

9. In our considered opinion, Appendix IV containing the agreement with a Tahsildar upon which the appellant was a signatory is directly hit by the Central Inland Water Transport Corporation case [1986 — II L.L.N 382] (vide supra). It was an agreement between the two unquals; the State with all its might and a poor man seeking job of a petty Tahsildar who has no right to utter a single word but to sign on the form given to him containing the agreement. We hold that Cl. (11) of the said agreement is contrary to S. 23 of the Contract Act as well as ultra vires Art. 14 of the Constitution.

10. The appellant cannot be removed from service until and unless there is a departmental proceeding against him with proper enquiry where he should be allowed to adduce evidence and make out a proper defence and thereafter the authorities can take a decision. Unless and until this procedure is adopted by merely applying Cl. (11), no one's service can be taken away by the Government, and more so when one is governed by the Government Servants' Conduct Rules and the West Bengal Services (Classification, Control and Appeal) Rules, 1971. We make it clear that even apart from the application of aforesaid rules and in keeping with the Supreme Court decision, nobody's service can be terminated by the Government or an organisation coming under Art. 12 of the Constitution at its sweet will or according to the terms as laid down in Cl. (11) of the agreement.

11. In the circumstances, the Order No. 5716, dated 24 December, 1977, issued by the Sub-Divisional Officer, Alipur Sadar, terminating the services of the writ-petitioner/appellant is hereby quashed and the judgment and order, dated 3 July, 1986, by the learned trial Judge is set aside. The appellant is hereby reinstated as the Tahsildar with effect from 1 January, 1978 and thereafter shall be absorbed and designated as Bhumi Sahayak with effect from 1 July, 1984 in accordance with the notification, dated 25 February, 1988, issued by the Board of Revenue, West Bengal, and other relevant Government orders and circulars. The respondents including the Secretary, Land and Land Utilisation and Land Reforms Department, Government of West Bengal, respondent 4, are directed to implement the order. We further direct the Board of Revenue, Government of West Bengal, and its Special Secretary to implement the aforesaid order. This order must be implemented within 30 days from the date of communication of the same toall the respondents including the Special Secretary of the Board of Revenue.

12. The writ-petitioner/appellant shall be paid all his arrear due's with effect from 1 January, 1978, within three months from the date of communication of the order and there will be no break of service.

13. The appeal is accordingly allowed. There will be no order as to costs.

14. Let xerox copy of this order be made available to the petitioner/appellant on usual undertaking and upon compliance of the necessary formalities.

15. S.P Rujkhowa, J.:— I agree.