Punjab-Haryana High Court
M/S Sun Pharmaceutical Industries Ltd vs Ashish Vij And Ors on 8 January, 2024
Author: Anil Kshetarpal
Bench: Anil Kshetarpal
Neutral Citation No:=2024:PHHC:006145
RSA-2908-2016 (O&M) & 2024:PHHC: 006145
RSA-2909-2016 (O&M)
-1-
IN THE HIGH COURT OF PUNJAB AND HARYANA
AT CHANDIGARH
1. RSA-2908-2016 (O&M)
Reserved on: 31.10.2023
Date of decision: 08.01.2024
M/S SUN PHARMACEUTICAL INDUSTRIES LTD. ..Appellant
Versus
ASHISH VIJ AND ORS. ..Respondents
2. RSA-2909-2016 (O&M)
M/S SUN PHARMACEUTICAL INDUSTRIES LTD. ..Appellant
Versus
ASHISH VIJ AND ORS. ..Respondents
CORAM: HON'BLE MR. JUSTICE ANIL KSHETARPAL
Present: Mr. M.P.S. Mann, Advocate
for the appellant.
Mr. Gurnoor P.S. Sarna, Advocate
for respondent No.1.
ANIL KSHETARPAL, J(Oral)
1. With the consent of the learned counsel representing the parties
two connected regular second appeals arising from the same suit shall stand
disposed of by a common judgment.
2. The defendant has filed the present appeal to challenge the
correctness of two separate judgments filed by the First Appellate Court in
two cross-appeals filed by the plaintiff and the defendant.
3. After having carefully examined the judgments of the Courts
below and the requisitioned trial Court record, this Court is of the opinion
that the following two issues need adjudication:-
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i. Whether an employee whose resignation is submitted,
on acceptance or conveyance of his resignation, in
absence of service rules or statutory provisions governing
the service conditions of employee in the non-
government organization/business house, enforce its
subsequent withdrawal through Court?
ii. Whether a civil suit for declaration filed by an
employee who is not covered under the definition of a
workman under the Industrial Disputes Act, 1947,
regarding his continuation in service in a non-government
organization/company, maintainable?
4. In order to comprehend the issue involved in the present case,
the relevant facts, in brief, are required to be noticed.
5. The plaintiff was appointed as a field coordinator in Ranbaxy
Laboratories Limited. On 09.04.1998, he was promoted as area Sales
Manager and thereafter, promoted as a Zonal Manager on 04.05.2001. The
respondent (plaintiff before the trial Court) submitted his resignation on
05.09.2003, which was accepted on 01.10.2003. He was asked to hand over
the company's properties, which were in his possession and also to obtain
the 'No Dues Certificate' from all the stockists. The resignation as well as its
acceptance, which was conveyed to the respondent reads as under:-
"Resignation:
Due to unavoidable personal reasons it is not possible for
me to continue my service with the company. I, therefore,
tender my resignation from the company's services w.e.f.
05th Sept. 2003. Treat the same as three month notice
period"
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"Acceptance of Resignation:
With reference to your resignation, we wish to inform you
that your resignation has been accepted and you will be
relieved from your duties with effect from the closing
hours of 04.12.2003 to your handing over the company's
properties in your possession to your superior/branch.
You are advised to return all company's properties
in your possession to your superior and also obtain 'No
Duess Certificate' from all the stockists to enable us to
settle your full and final account.
Your are advised to contact your branch office to
enable them to settle your account in accordance with the
terms and conditions of your employment. Please also
complete the enclosed feedback from & send back to us at
the earliest."
6. The respondent on 07.11.2003, requested the company to give
him 45 days time for obtaining the 'No Dues Certificate' as he requires such
time to cover whole of India for collecting the certificates. On 14.11.2003,
the plaintiff again requested for the same. He also requested the company to
pay him arrears of salary and tour expenses. He also demanded advances so
that he could visit and collect the 'No Dues Certificate' from the stockists,
who are spread over in 2/3rd of the country. In the letter dated 07.11.2003, as
well as 14.11.2003, the plaintiff stated that he would remain on the
company's payroll till collection of 'No Dues Certificate's. On 25.11.2003,
the respondent requested the office to permit him to withdraw resignation,
and his withdrawal was not accepted or replied to by the company. The
plaintiff claims that he kept attending the work of the company, however, he
was not paid. On 21.01.2005, the appellant sent a cheque of Rs.2,00,000/-
towards the full and final settlement of the accounts.
7. Though, the plaintiff has claimed that he wrote a letter on
02.11.2003, however, the same has not been produced. The first letter, which
has been produced by the plaintiff is a letter dated 07.11.2003, which is
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Ex.P-4. In this letter, the plaintiff acknowledged the receipt of letter dated
01.10.2003 accepting his resignation. He requests for release of his salary
and tour expenses. He also requests for tour advance to enable him to get the
'No Objection Certificate' from the parties, who are residing in 2/3rd of the
country. He further states that without the tour advances and extended
period, it will not be possible for him to collect the No Objection Certificate.
In the end he has stated that his notice period of resignation may be
considered from the date of supply of requisite certificates. This request is
reiterated in the communication dated 14.11.2003. The receipts of letter
having been sent through registered post produced by the plaintiff are
perused carefully by the Court. It appears that these letters were posted on
25.11.2003. In the letter, the plaintiff has made reference to a telephonic
conversation with the general manager regarding his pending salary and tour
advances, which took placed on 08.03.2004. He also refers to the discussion
that took placed with another officer Mr. Mukherjee. Thereafter, on
06.05.2004, Ex.P-10, he requests for release of his salary etc. Ex.P-11, dated
06.05.2004, is again a letter written by the respondent (plaintiff) to the same
effect. He also refers to some bio-fuel project carried on in the State of
Madhya Pradesh with some parties. The next communication dated is
07.08.2008 (Ex.P-3), wherein he claims that he still on company's payroll.
On 21.01.2005, the appellant-company sent a cheque of Rs.2,00,000/-
against full and final settlement. On a perusal of the receipt, it is evident that
the plaintiff received the cheque, wherein, it was recorded that he has
received the payment in full and final settlement of the company.
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8. The plaintiff (respondent herein) filed the suit on 07.10.2005,
for grant of decree of declaration to the effect that the resignation of the
plaintiff has not been effective, having been withdrawn during the notice
period and before the effective date and hence, the plaintiff is entitled to all
the consequential benefits etc. including arrears of salary etc. The suit was
contested by the defendant (appellant).
9. Both the Courts decreed the suit on the ground that the
resignation was withdrawn before it was to come into effect and in view of
the judgment passed by the Supreme Court in Shambhu Murari Sinha Vs.
Project and Development India Ltd., AIR 2002 (SC) 1341, the plaintiff is
entitled to grant of decree of declaration that he continues in service. Against
the judgment and decree passed by the trial Court, two appeals were filed,
one filed by the plaintiff claiming interest on the arrears of pay and other
allowances, whereas, the second filed by the appellant (defendant)
challenging the correctness of the judgment and decree passed by the trial
Court. The First Appellate Court has passed two separate judgments. The
appeal filed by the respondent has been accepted and the Court has directed
the company to pay arrear, salary and consequential benefits along with
interest at the rate of 12% from the date it becomes due till its payment,
whereas, the appeal filed by the appellant has been dismissed.
10. This Bench has heard the learned counsel representing the
parties at length and with their able assistance perused the paperbook and the
written submissions filed by them along with the requisitioned record.
11. On the one hand, the learned counsel representing the appellant
contends that on acceptance of resignation, the jural relationship between the
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respondent and company came to an end and therefore, letters sent by him
on 25.11.2003, are of no substance. He submits that the suit filed by the
plaintiff for grant of decree of declaration was also not maintainable in view
of Section 14 of the Specific Relief Act, 1963.
12. On the other hand, the learned counsel representing the
respondent has submitted that the resignation of the respondent was accepted
subject to the condition that he will be relieved from his duties with effect
from closing hours of 04.12.2003, subject to his handing over company's
properties in his possession and 'No Objection Certificate' obtained from all
the stockists. He submits that in these circumstances, there was no
acceptance of his resignation and therefore, the resignation stood withdrawn
vide communication dated 25.11.2003. He also relies upon the judgment
passed in Rajasthan State Road Transport Corporation Vs. Krishan Kant
and others, AIR 1995 (SC) 1715 and Ashok Kumar Srivastav Vs. National
Insurance Company Ltd., AIR 1998 (SC) 2046, to contend that the suit for
grant of decree of declaration is maintainable.
Discussion and Conclusion:-
13. A perusal of the entire record shows that while coming to
conclusion both the Courts have over emphasized on the oral evidence of
DW-1 Sh. Varinder Singh, Senior Executive, HR of the appellant-company
on the basis of his deposition, the Courts have held that the respondent
continued to work for the company after his resignation was accepted. It
may be noted here that overemphasis on the oral evidence in preference to
the documentary evidence is not appropriate. It has been noticed that the
deposition of Sh. Varinder Singh runs from pages 215 to 259, whereas, the
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cross-examination itself is covered in around 30 pages. As per the provisions
of the Indian Evidence Act, 1872, the Courts have a bounden duty to
regulate the relevant evidence even during the stage of cross-examination of
the witness. Irrelevant and totally unrelated questions should not be
permitted as it results in wastage of precious time and energy of the Court.
Moreover, while relying upon the oral evidence, the Court is expected to
read the statement/deposition in entirety in order to understand it. Reading of
isolated sentences in the deposition, divorced from the entire context should
be avoided. It is also well settled that the oral evidence is not required to be
given precedence over the documentary evidence, available on record.
14. In this case, it is evident that the respondent resigned without
any pre-condition. He submitted his resignation from 05.09.2003, which
shall be treated as three months' notice period. On 01.10.2003, his
resignation was accepted. The communication dated 01.10.2003, is required
to be read carefully. The first part of the first sentence of letter dated
01.10.2003, proves that respondent's resignation was accepted forthwith,
however, the date of relieving him from his duties was postponed till the
closing hours of 04.12.2003, with a caveat to return company's properties in
his possession. However, the acceptance of resignation was complete and it
was not subject to the respondent's handing over the company's property. In
the second paragraph, the respondent has been advised to obtain 'No Dues
Certificate' from all the stockists. The requirement of the certificates was to
enable the appellant to settle his full and final accounts. Therefore, both the
Courts have erred in assuming that the resignation shall be deemed to have
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been accepted only with effect from 04.12.2003. In fact, the first part of the
first sentence is categoric that the respondent's resignation stands accepted.
15. Thereafter, it is the prerogative of the appellant-company to
permit him to withdraw the resignation or not. The appellant is a limited
company but it is not an instrumentality of the State as provided under
Article 12 of the Constitution of India. It is not the case of the plaintiff that
there is any rule or resignation which enables the employee to withdraw the
resignation. In these circumstances, the unilateral withdrawal of the
resignation is not binding on the appellant-company.
16. On a comprehensive reading of the deposition of Sh. Varinder
Singh, the only witness who was examined by the appellant-company, it
becomes evident that the resignation was accepted forthwith i.e. on
01.10.2003. In one of the isolated sentence, he has stated that he was not
aware of the fact that after withdrawal of his notice of resignation, the
plaintiff continued to attend the office. That statement has been interpreted
to hold that the respondent continued in service. This sentence as already
noticed cannot be read in isolation. The defendant has only stated that he
was not aware of the fact.
17. Both the Courts have also assumed that because Sh. Varinder
Singh has admitted that full and final payment has not been made to the
respondent, therefore, he continued in service. The full and final payment is
not one of the pre-condition for acceptance of resignation. As already
explained, the resignation was accepted forthwith. Only relieving of the
employee was postponed in order to fulfill the formalities, however, the
plaintiff cannot claim that he continues in service. It is also evident from the
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various communications that the plaintiff was requesting for meeting with
the officials and was writing letters by registered post. If he had been
continuing in service, there was no necessity of sending the communications
by the registered post.
18. This Bench now proceeds to discuss the law laid down by the
Supreme Court on the subject.
19. This Court has carefully read the judgment passed in Shambhu
Murari Sinha's case (supra). This case was related to the instrumentality of
the State because a writ petition under Article 226 of the Constitution of
India was filed. Moreover, the issue in this case is not related to resignation.
Rather, a voluntary retirement scheme was floated by the employer and the
employee submitted his request. The terms and conditions of the voluntary
retirement were governed by the Voluntary Retirement Scheme (VRS),
hence, the aforesaid judgment is not applicable to the peculiar facts of the
present case. The First Appellate Court has also relied upon the judgment
passed in Raj Kumar Vs. Union of India, AIR 1969 (SC) 180. On a careful
reading of the aforesaid judgment, it becomes evident that the Supreme
Court held that the resignation could only be withdrawn before it was
accepted by the appropriate authority. This case was also with regard to a
government employee or in other words a civil servant, whose service
conditions are succinctly elucidated in the service rules and Article 311 of
the Constitution of India.
20. The learned counsel representing the respondents has also relied
upon the judgment passed by the Supreme Court in Krishan Kant's case
(supra). After reading the aforesaid judgment, it is evident that the judgment
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nowhere discusses the context of Section 14 of the Specific Relief Act, 1963.
The employer in this case was instrumentality of the State Government and
the case pertains to a suit filed for declaration assailing the correctness of the
order passed terminating the services of the employees. Hence, the aforesaid
judgment is also not applicable to the facts of the case at hand.
21. The next judgment relied upon by the learned counsel is passed
in Ashok Kumar Srivastav's case (supra). This judgment is also with
respect to instrumentality of the Central Government and therefore, the
services were governed by the service rules. Moreover, the suit filed by the
plaintiff was dismissed ultimately.
22. It may be noted here that a Five Judge Bench of the Supreme
Court in Sirsi Municipality Vs. Cecelia Kom Francis Tellis, (1973) 1 SCC
409, held that except under the Industrial Disputes Act, 1947, or public
servants under employment of the State or other public or local authorities or
bodies created under the State can be reinstated, even if the dismissal is
contrary to the rules of natural justice or in violation of statute. It is evident
from the reading of the aforesaid judgment that only three following
exceptions were carved out by the Supreme Court while ordering
reinstatement:-
i. If the dispute is covered by the Industrial Disputes Act,
1947.
ii. If it pertains to a public servant, who is sought to be
removed from service in contravention of Article 311 of
the Constitution of India.
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iii. Where a statutory body acts in breach of the violation
of the mandatory provisions of the statute.
23. This judgment has been consistently followed in Executive
Committee of Vaish Degree College Vs. Lakshmi Narain (1976) 2 SCC 58
and Hindu College Vs. Sadhu Ram Saini, (1997) 11 SCC 471. In Kailash
Singh Vs. Mayo College, (2018) 18 SCC 216. In these cases, the Court held
that in an ordinary relation of master and servant governed purely by
contract, a grant of decree of declaration of unlawful termination would
indirectly amount to specific performance of contract of personal service,
which is not permissible under Section 14 of the Specific Relief Act, 1963.
Similarly, in M/s Pearlite Liners Pvt. Ltd. Vs. Manorama Sirsi, (2004) 3
SCC 172, the Court once again held that unless the case falls in any of the
three exceptions carved out in Sirsi Municipality's case (supra), the suit for
grant of decree of declaration that the employee continues in service of the
defendant company would amount to enforcing a contract of personal
service, which is barred under law.
24. With reference to question No.1, it may be noted that the
respondent's resignation was accepted on 01.10.2003, in absolute terms and
only his relieving was postponed for a period of two months to enable the
respondent to complete the formalities. In these circumstances, both the
Courts have erred in observing that acceptance of resignation was subject to
the fulfillment of the formalities.
25. In view of the aforesaid conclusive interpretation of law on the
subject, it is evident that the suit filed by the plaintiff for grant of decree of
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declaration was not maintainable. Consequently, question No.2 is answered
in favour of the appellant i.e. it is answered in affirmative.
26. Though, it has not been prayed for by the plaintiff, however, in
order to avoid multiplicity of the litigation, it is ordered that the appellant
shall release all the dues payable to the employee as admitted by Sh.
Varinder Singh within a period of two months. Sh. Varinder Singh has
admitted that the appellant-company has to pay a sum of Rs.3,48,000/- to the
respondent. Hence, the aforesaid amount shall be paid along with interest at
the rate of 9% from 04.12.2003 till its payment.
27. With these observations, both the appeals are allowed.
28. All the pending miscellaneous applications, if any, are also
disposed of.
January 08th, 2024 (ANIL KSHETARPAL)
Ay JUDGE
Whether speaking/reasoned : Yes/No
Whether reportable : Yes/No
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