LAWS(CAL)-1971-2-15

ASANSOL ELECTRIC SUPPLY CO Vs. CHUNILAL DAW

Decided On February 24, 1971
ASANSOL ELECTRIC SUPPLY CO. Appellant
V/S
CHUNILAL DAS Respondents

JUDGEMENT

(1.) This is an appeal by a public company, the Asansol Electric Supply Company Ltd. and its four Directors against a judgment and decree of affirmance. The plaintiff Chunilal Das, as an employee of the company instituted a suit inter alia for a declaration that certain resolutions purported to have been passed by the Board of Directors of the Company as also by its shareholders were illegal, void, inoperative and not binding on the plaintiff and also for some other reliefs. The plaintiff's case in short is that he was firstly appointed a Manager of the Company which appointment was confirmed by a special solution passed at its General Meeting held on September 25, 1957 of the shareholders of the company, the plaintiff's designation was however changed from Manager to Supervisor, and, the remuneration fixed was Rs. 750/- per month with effect from January, 1958 and of annual increment of Rupees 10/- and dearness allowance of Rs. 180/- per month unless otherwise determined by the Board. It may be mentioned here that the plaintiff is a relative of the Defendant No. 2, the Managing Director of the Company and accordingly shareholders' approval was considered necessary in view of Section 314 of the Companies Act, 1956. By another resolution dated April 24, 1963 passed by the Board of Directors of the Company, the post of Supervisor was abolished with effect from May 1, 1963 and the plaintiff was appointed Store-in-Charge on the same pay and allowances. While he was engaged in the said office, a notice was issued on July 5, 1963 by the Board for a proposed extra ordinary general meeting of the company to be held on July 29, 1963 to consider and if thought fit to pass the resolution appended thereto, with or without modification, as a special resolution, also in view of Section 314 of the Act. In the said proposed resolution it was stated that the plaintiff was to be appointed a Store-in-Charge with effect from May 1, 1963 at a basic salary of Rs. 810/- per month. It appears that on that date a meeting of the shareholders was held when the plaintiff objected to the defendant No. 2 being in the chair which objection was overruled. The resolution which was notified to be proposed at the meeting by the notice of July 5, 1963 was neither placed nor moved and accordingly not passed at the said meeting. On the contrary a resolution was passed to the effect that the plaintiff was not to be appointed Store-in-Charge with effect from May 1, 1963 and further that the plaintiff had ceased to hold office as a Store-in-Charge with effect from the said date. On the same day, the defendant No. 2 informed the plaintiff by a latter that the plaintiff's service had been terminated with effect from May 1, 1963.

(2.) The plaintiff on the above allegations instituted the suit for declaration that the resolution of the Board dated April 24, 1963 as also the resolution of the General Meeting of July 29, 1963 were void, invalid, inoperative and not binding on the plaintiff, and, that further the service of the plaintiff as a Supervisor of the company had been continuing and the plaintiff was entitled to arrears of salary and allowances on account thereof. There was a claim for Rs. 3,000/- as damages for mental pain and agony as also loss of prestige in public estimation suffered by the plaintiff. The plaintiff was refused access to the company by the defendant and accordingly he instituted this suit for the aforesaid reliefs and for permanent injunction restraining the defendants from interfering with the plaintiff in the discharge of his duties under his service with the company.

(3.) The suit was contested by the defendants who filed separate written statements denying the claims made in the plaint. The common defence as it appears from the written statement was that the plaintiff's service was lawfully and validly terminated and the resolution passed by the Board as also in the extra ordinary general meeting of the shareholders impugned in the plaint were valid and legal. It was also contended that the suit for enforcement of the personal contract of service was not maintainable and was barred under the provisions of the Specific Relief Act, 1877.