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  • Indian Contract Act and Specific Relief Act
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Citation Codes
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citation codes
Case Number
Disposition
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  • Indian Contract Act and Specific Relief Act
Smart Summary

Factual and Procedural Background

The petitioner, Radha Kishan, was engaged by the respondents on a contractual basis. The petitioner challenged the termination of his contract before this Court under Article 226 of the Constitution of India. The Court noted that the challenge to the termination order could not be entertained in view of binding precedent established by the Division Bench in Writ-A No. 54840 of 2013 (Rejesh Bhardwaj Vs. Union of India And Others). The case proceeded on the basis that the petitioner’s employment was governed by a contract of service rather than by statutory status.

Legal Issues Presented

  1. Whether the termination of a contract employee engaged on a contractual basis by a State entity can be challenged under Article 226 of the Constitution.
  2. Whether relief of reinstatement or continuance in employment is available to a contract employee terminated by the employer.
  3. The legal distinction between employment governed by 'status' and employment governed purely by a 'contract of service'.

Arguments of the Parties

The opinion does not contain a detailed account of the parties' legal arguments.

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
Roshan Lal Tandon Vs. Union of India, AIR 1967 SC 1889 Distinction between 'status' employment and contractual employment; rights under statute vs. contract. Used to clarify that contract employees do not acquire statutory status and their rights are governed by contract terms.
Sirsi Municipality Vs. Cecelia Kom Francis Tellis, (1973) 1 SCC 409 Categorization of dismissal cases into three heads: contract employment, industrial law governed, and statutory employment. Applied to explain that contract employment does not allow relief of reinstatement but only damages for wrongful dismissal.
Executive Committee of Vaish Degree College, Shamli and others Vs. Lakshmi Narain and others, AIR 1976 SC 888 Relief of reinstatement available where employment is governed by statute and termination violates statutory rules. Supported the principle that statutory employees have protection not available to contract employees.
Smt. J. Tiwari Vs. Smt. Jawala Devi Vidya Mandir and others, AIR 1981 SC 122 Similar principle affirming relief of reinstatement under statutory employment. Reiterated the distinction between contractual and statutory employment rights.
Life Insurance Corporation of India Vs. Escorts Ltd. and others, AIR 1986 SC 1370 Affirmed the principle of reinstatement relief under statutory employment. Used to confirm that statutory employment relationships are governed by public law.
A.K. Home Chaudhary Vs. National Textile Corporation U.P. Ltd., Kanpur, 1984 UPLBEC 81 Application of statutory employment principles in local context. Referenced to support statutory employment protections.
B.M. Varma Vs. State of U.P. and others, 2004 (4) AWC 2866 Reinforcement of statutory employment protections. Supported the Court’s position on statutory vs contractual employment.
Vivek Kumar Mishra and others Vs. State of U.P. and others, 2008(4) ESC 2811 Further affirmation of statutory employment protections. Used to consolidate the legal framework distinguishing employment types.
Kailash Singh Vs. The Managing Committee, Mayo College, Ajmer and others, (2018) 10 SCALE 638 Employment governed by simple contract does not permit relief of reinstatement, only damages. Applied directly to confirm that contract employees cannot claim reinstatement relief.
State of U.P. & Others Vs. Anil Kumar Singh Yadav & Others (2013) 2 UPLBEC 1588 Reiteration of principles regarding contractual employment and remedies. Supported the dismissal of writ petitions challenging contract termination.
Rajesh Kumar Srivastava Vs. State of U.P. and others, Writ Petition (Writ-A) No. 36854 of 2001 Similar application of contract employment principles. Referenced to uphold dismissal of claims for reinstatement by contract employees.

Court's Reasoning and Analysis

The Court analyzed the nature of the petitioner’s employment relationship and distinguished between employment governed by 'status' under statutory rules and employment governed purely by a 'contract of service'. It relied on binding precedents which establish that contract employees do not acquire the statutory status of government servants and their rights are governed strictly by the terms of the contract.

The Court further explained that under the law of specific relief, breach of contract of employment cannot be enforced by specific performance or reinstatement, as personal service contracts are not amenable to such relief. Instead, wrongful termination of a contract employee entitles the employee only to claim damages, not reinstatement.

The Court categorized dismissals into three heads: (1) pure contract employment, (2) employment governed by industrial law, and (3) statutory employment. Only the latter two categories permit relief of reinstatement, while the first does not.

Applying these principles, the Court held that since the petitioner’s employment was contractual and not statutory or industrial law governed, no relief of reinstatement or continuance in service could be granted.

Holding and Implications

The Court’s final decision was to dismiss the writ petition filed by the petitioner.

The direct effect of this decision is that the petitioner’s challenge to the termination of his contractual employment is rejected, and no relief of reinstatement or continuation in service is available. The ruling reaffirms established legal principles distinguishing contractual employment from statutory employment and confirms that courts will not grant reinstatement for breach of a contract of employment but may allow claims for damages. No new precedent was created by this decision.

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    Radha Kishan v. State Of U P And 4 Others

    Court No. - 6 Case :- WRIT - A No. - 27852 of 2018

    Petitioner :- Radha Kishan

    Respondent :- State Of U P And 4 Others

    Counsel for Petitioner :- Birendra Singh

    Counsel for Respondent :- C.S.C.,Ashok Kumar Yadav

    Hon'ble Yashwant Varma,J.

    Heard learned counsel for the petitioner and the learned Standing Counsel for the State respondents. Undisputedly, the petitioner was engaged on contractual basis by the respondents. The challenge to the order terminating the said contract cannot possibly be tested before this Court under Article 226 of the Constitution in light of the decision rendered by the Division Bench in Writ -A No. -54840 of 2013 (Rejesh Bhardwaj Vs. Union of India And Others). The Division Bench while deciding the aforesaid writ petition noted the status of a contract employee in the following terms:

    "31. As we have already said that CUPGL even if taken to be a 'State' within the meaning of Article 12 of Constitution, this by itself would not mean that petitioner can claim status of a Government Servant or holding a post governed by 'status'. Nature of engagement/ appointment of petitioner is not to be governed by 'status' but by a 'contract of service' entered into between master and servant. A distinction between an appointment under a contract and status was noticed and explained by Supreme Court in Roshan Lal Tandon Vs. Union of India AIR 1967 SC 1889. Court held that when a matter is governed by status, the employee has no vested contractual rights in regard to the terms of service but where employment is purely in the realm of a simple contract of employment, it is strictly governed by terms and conditions of employment settled between the parties. To remind the difference between 'status' and Neutral Citation No. - 2019:AHC:3338

    1

    'contractual appointment', we may take up case of a Government Servant. Origin of employment in a Government department is contractual. There is an offer and acceptance in every case but once appointed to the post or office, the person appointed, i.e., Government Servant, acquires a status and his rights and obligations are no longer determined by consent of both the parties but same are governed by Statute or statutory rules which may be framed and altered unilaterally by employer, i.e., the Government. Legal position of a Government Servant, thus, is more one of 'status' than of a 'contract'. The hallmark of 'status' is that attachment to a legal relationship of rights and duties must be by public law and not by mere agreement of parties. Relationship between Government (employer) and Government Servant (employee) is not like an ordinary contract of service between a master and servant. The legal relationship is something entirely different, something in the nature of status. In the language of jurisprudence, 'status' is a condition of membership of a group, whereof powers and duties are exclusively determined by law and not by agreement between the parties concerned. Thus, where appointment and conditions of service are governed by Statute, relationship of 'employer' and 'employee' is that of 'status' and not a mere contract. However, in other cases, it is purely a contract of service resulting in a relationship of ordinary master and servant.

    32. In the present case also, relationship of employment between petitioner and CUPGL is purely and simply an ordinary contract of service which is not governed by any statute or statutory provision. In such cases, a contract of service cannot be sought to be enforced by Court of law by giving relief of reinstatement or continuance in employment as this relief is barred under Act, 1963."

    After noticing the above principles, the Division Bench thereafter proceeded to hold as under:-

    "36. The matter was again considered by a Constitution Bench in Sirsi Municipality Vs. Cecelia Kom Francis Tellis (1973) 1 SCC 409 and therein Court held that cases of dismissal of a servant fall under three broad heads. The first head relates to relationship of master and servant governed purely by contract of employment. Any breach of contract in such a case is enforced by a suit against wrongful dismissal and for

    2

    claiming damages. Just as a contract of employment is not capable of specific performance similarly breach of contract of employment is not capable of finding a declaratory judgment of subsistence of employment. A declaration of unlawful termination and restoration to service in such a case of contract of employment would be indirectly an instance of specific performance of contract for personal services. Such a declaration is not permissible under the Law of Specific Relief.

    37. Second category noticed by Court is where master and servant's relationship is governed by Industrial Law. In such cases, a servant, who is wrongfully dismissed, may be reinstated since Industrial Law contains special provisions and this is a departure from the reliefs available under Indian Contract Act and Specific Relief Act which do not provide for reinstatement of a servant.

    38. The third category is where employment is in State or other public or local authorities or bodies created under statute. In such cases, if termination is contrary to Rules, Court can declare such termination illegal and grant relief of reinstatement for the reason that in such case, Court keeps employer within the limits of its statutory powers. The above view has been reiterated in Executive Committee of Vaish Degree College, Shamli and others Vs. Lakshmi Narain and others AIR 1976 SC 888 (paras 9, 10, 13 and 17); Smt. J. Tiwari Vs. Smt. Jawala Devi Vidya Mandir and others, AIR 1981 SC 122 (paras 4 and 5); and Life Insurance Corporation of India Vs. Escorts Ltd., and others AIR 1986 SC 1370 (paras 101, 102). Similar view has been taken by this Court also in A.K. Home Chaudhary Vs. National Textile Corporation U.P. Ltd., Kanpur 1984 UPLBEC 81; B.M. Varma Vs. State of U.P. and others 2004 (4) AWC 2866; and Vivek Kumar Mishra and others Vs. State of U.P. and others,

    2008(4) ESC 2811.

    39. Recently also, in Kailash Singh Vs. The Managing Committee, Mayo College, Ajmer anD others. (2018) 10 SCALE 638, where dispute related to termination of an employee of Mayo College, Court held that employment was governed by simple contract of employment and, hence, no relief of reinstatement can be granted, but employee, if wrongfully terminated, may claim damages.

    40. Following the above authorities, same view has been expressed and reiterated by this Court subsequently also in State of U.P. & Others Vs.

    3

    Anil Kumar Singh Yadav & Others (2013) 2 UPLBEC 1588 and Writ Petition (Writ-A) No. 36854 of 2001 (Rajesh Kumar Srivastava Vs. State of U.P. and others) decided on 09.05.2016.

    41. In view of discussions made hereinabove, no relief, as sought for, can be granted to petitioners. Both the writ petitions lack merits and are, accordingly, dismissed."

    Accordingly and for the reasons noted above, this petition is

    dismissed.

    Order Date :- 7.1.2019 Arun K. Singh

    (Yashwant Varma, J.)

    4

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    Radha Kishan v. State Of U P And 4 Others
    (Jan 7, 2019)