KULDIP MEHTA Vs. UNION OF INDIA

JUDGEMENT

(1.) Services of the petitioner who was working as Chief Executive (Corporate Affairs) in Swadeshi Polytex Limited (respondent No.2), a public limited company, were terminated by order dated20June 1991 of the third respondent- Chairman and Managing Director (CMD)ofrespondentNo.2,anofficer of the Indian Administrative Service. The petitioner seeks an appropriate order, or a writ of certiorari quashing that order being violative of principles of natural justice and violative of Articles 14 and 21 of the Constitution. He further seeks an appropriate direction or order or writ in the nature of mandamus declaring that the third respondent had no legal authority to terminate his services. There is also a prayer that the appointment of the third respondent as C.M.D. of the company was itself irregular and void, but that prayer has not been pressed. Yet another prayer was that a direction, writ or order be issued directing the respondents to continue the services of the petitioner till the completion of his service tenure. Since during the pendency of the writ petition that service tenure was over, again this prayer was not pressed, it having become infructuous.

(2.) There are three respondents. First respondent is Union of India in the Ministry of Textile through its Secretary, and the second and third respondents, as noted above, are respectively the company and the CMD. The principal contention of the respondents which we may note at the very threshold of this judgment is that the company, the second respondent, is not a State within the meaning of Article 12 of the Constitution and, thus, not amenable to writ jurisdiction of this Court under Article 226 of the Constitution. We may now briefly give the facts of the case which are not in dispute.

(3.) The petitioner was earlier an employee of ICI India Limited from where he retired in 1989. A letter dated 22 July 1988 was addressed to him by the then Chairman of the Company, the second respondent, offering him the appointment as Chief Executive (Corporate Affairs) of the company at a fixed salary ofRs.l2,500.00 permonth on certain terms. A regular letter of appointment was issued to the petitioner on 22 February 1989 which spelled out in detail the terms and conditions of the employment of the petitioner. He was to be paid Rs. 12,500.00 per month as his salary and given other perks as per rules of the company. The petitioner was told that his tenure of service would be three years subject to extension by another two years at the discretion of the company with a rider that services could be terminated by either party by giving three months notice or paying salary in lieu thereof. This was term No. 18 of the letter of appointment. On 20 June 1991 the C.M.D., the third respondent, addressed a letter to the petitioner drawing his attention to this term and saying that services of the petitioner were no longer required, and therefore, stood terminated with immediate effect. The petitioner was told that he was entitled to three months salary in lieu of notice after dues, if any. from him to the company. By letter dated 27 June 1991 the petitioner asked the C.M.D. to give him reasons as to why he was issued the letter of termination and for an opportunity to state his case, if necessary. The petitioner said this might be useful to reconsider the matter by the C.M.D. Apublic notice, also appeared in the Hindustan Times on 26 June 1991 in the name of the C.M.D. that the petitioner had ceased to be in the employment of the company w.e.f. 20 June 1991 and that all authorities vested with him remained withdrawn from that date. It has not been made clear to us as to what was the necessity of issuing such a public notice. Then by letter dated 16 July 1991 the petitioner objected to the arbitrariness and unlawful action of the C.M.D. in terminating his services and requested him to withdraw the letter of termination and restore his status and facilities due to him. Since nothing happened this petition was filed on 31 July 1991.