SIRSI MUNICIPALITY BY ITS PRESIDENT SIRSI versus CECELIA KOM FRANCIS TELLIS

SIRSI MUNICIPALITY BY ITS PRESIDENT SIRSI

CECELIA KOM FRANCIS TELLIS

January 18, 1973

(S. M. SIKRI, C. J., A. N. RAY, D. G. 'PALEKAR, M. H. BEG AND S, N. DWIVEDI, JJ.J

Bon1hay District Municipal Act 1901-Rules nuule under s. 46--Rults 143 11uindatory-Disn1issal of employee without reasonable oppor~ tunity .to show cause l'oid and illegal-State authorities 1nust cct 'within Jin1its of statuton,.i poa·ers-Public_ en1ploy11ient distinguished front p'ri· "·ate en1p/oy1nent. The respondent was an employee of the -appellant municipality a!' midwife in its hospital. On the death of patient in the hospital an enquiry was held by the Civil Surgeon who found that the death was not <luc to the negligence of the hospital staff. Thereafter committee appointed by the municipality held an enquiry and made its report. The President of the municipality gave notice to the respondent that as she was responsible for the death of the patient in question due to her :negligence she. should appear before the Municipal Council at its meeting at 4 p.m. on 25 March 195~ and give her explanation. She s-ent her reply denying her negligence and also stated that if It was necessary for her to explain anything she should be asked in writing. She did not appear before the Council at the appointed time. When she did appear at 6 p.m. she insisted that the charge against her should be in writing. The municipality dis~ssed her from service. The _res· pondent thereupon filed suit for declaration that the resolution of the municipality dismissing her from service was void. Her fir.st contention was that Rule 143 of the Ruk" framed by the municipality had been violated as she was !liOt given an opponunity of defending herself against the chafge. Her second contention was that the resolu-tion was passed by the municipality on day when the question of her dismissal was not on the agenda. The High Court upheld the findings of the trial court and the first Appellate court that the res· pQndent was not given reasonable opportunity to defend herself anJ thus r. 143 was violated and on this ground upheld the declaration that she was deemed to have continued in service from the date of dismissal to the date of the suit. In appeal by. special leave before this Court the municipality contended that the respondent was not entitled to any declaration and that if the dismissal was wrongful the remedy ·lay in damages.

HELD: (per Sikri, C.J ., Ray, Palekar and Dwivedi, JJ.) (i) Tennination or dismissal of what is described as pure contract of master and servant is not declared to be nullity however wrongful or iIJ.egal it may be. The reason is that dismissal in breach of contract is remedied by damages. [353F-GJ

In the case of servant of the State or of local authorities, courts have declared in appropriate cases the dismissal to be invalid if the dismissal is contra'rv to the rules of natural justice or if the dismissal or if- the dismissal iS in violation of the provisions of the stattife. Apart fram the intervention of statute there would not be a, declaration of

nullity in the case of termination or dismissal of setva!nt of the Stat-I! or of other local authoriti"' or statutory bodies. [3530-H]

The courts keep the State and the public authorities within the limits of their statutory powers. Where State or public authority dis· misses an employee in violation of the mandatory procedural require· ments or on grounds which are not sanctioned ol' supported by statute the courts may exercise, jurisdiction to declare the act of dismissal to' 8 be ;nullity. Such implication of public employment is thus distinguish-ed from private· employment in pure cases of master and .servant. l353H,354B]

This Court in its decisions has held that the dismissal or termination of the services of employees without complying with the provisions of statute or scheme or Order is invalid. This Court has questioned the orders of dismissal and granted appropriate declara-tions. [356C-DJ

Executh·e L'o111111iltee of U.P. State Warehousing Corporation Lbnit-<'d. v. l~hatulra Kiran Tyagi, [1970} 2 S.C.R. 250 a:nd Indian Airli1u•\' Corpora.tio11 v. Suklufeo Rai, [1971] 2 S.C.C. 192, distinguished.

S. R. Tewari v. District' Boar,/, Agra, [1964) 3 S.C.R. 56, Life Insurance l'orporation of India v. Sunit Kz11nar Mukherjee, [1964] 5 S.C.R. 528, Ca!cutta Dock Labour Board v. Jafjar bnani & Ors., 1'1965] 3 S.C.R. 453 and Nc.raindas Barot v. Divisiorui/ Controller, S.T.C., [1966] 3 S.C.R. 40, referred to.

Recent English decisions, also indicate that statutory provisions may lin1it the power of dismisSal. [356D-F]

Vine v. National Dock Labour Board, [1956) 3 All.E.R. 939 Barber v. Manchester Hospital Board, [1958] I All. E.R. 322. RidRe v. B<l/dwi11, 11964) A.C. 41, Malloch v. Aberdeen Corporation. [19711 2 All. E.R. 1278 and McClelland v. Northern Ireland Generc.l Health Services Board. [1957] I W.L.R. 594, referred to.

(ii) In the present case the dismissal of the respondent must he declared to be illegal and void. Rule 143 in1poses mandatory obligation. The rules y,·erc made in exercise of power confeired on the nlunicipality by statute. The rules are binding on the municipality. They cannot be. amended without the assent of the State Government. The disn1issal of the respondent was rightly found by the Hi~h Court to be in violation of rule 143 which imposed- ma,Ttdatory obligation. The respondent was dismissed without reasonable opportunity of being heard in her defence. The dismissal by the municipality was without recdrding anv written statemerit "'hich might have been tendered. The dismissal by the municioalitv was \vith· out \vrittcn order. The dismissal was ultra v;1·es. [357G-358A]

Per Beg, J. (concurri11g)-The competence of the Municipal courl to pass the rcso]utir.n dismis..;;ing the respondent depended more on compliance with Rule 143 made unclor s. 46 of the Bombay District Municipal Act, 1901 than on s. 26(8) of the Act. Compliance wit~ such rule could not be dispensed with bv the Collllcll or its presiding au1hority under s. 26(8) of the Act. [359C-E]

be made or

Neither r\lles nor bye-Jaws of the municipality could be made or altered by it unilaterallv. lloth operated as. laws which bound the local nuthority. This was clear frlllll ss. 46 and 48 of the Act_

An express statutory provision or guarantee is not the only basis of mandatory duty, or obligation. It ca'! he impo~ed either_ by .a r:ite made in exercise of statutory power or 1t may ar1sc by 1mpltcation when exercising quasi-judicial function, [360G-HJ

The present case undoubt£dly fell within the category of cases where dismissal must be based upon decision arrived at quasi·judicially about wrong done by the seryant. This ele-ntary and basic procedural safeguard, flows not merely from an implied rule of natural justice but in the present case it is actually embodied in rule which cannot be interpreted as anything other than legal limitation or fett£r on th<: power of the municipality to dismisses. [362F-Gl This could not be case in which damages for simple breach of contract could afford adequate relief. Damages could !OOt wipe off the· stigma attached to the record. of the sefV'aD.t. The law requires that he_fore the future of servant is allowed to be marred by blot on the recorJ of the servant concerned,, rules of natural justice must -be complied with. [363A-Bl

Case law referred to.

CIVIL APPELLATE JURISDICTION : Civil Appeal No. 330 of 1967.

Appeal by special leave from the judgm~nt and order dated June 16, 1966 of the Mysore High Court at Bangalore in Regular First Appeal No. 33 of 1962.

R. B. Datar and S. N. Prasad, for the appellant.

S. S. Javali, B. P. Singh and D. N. Mishra, for the re.spondent.

G. B. Pai and C. S. Rao, for the intervener No. 1.

G. Ramchandra Rao and B. Parthasarath.v, for intervener No. 2.

D. V. Patel and K. L. Hathi, for intervener No. 3.

S. Balakrishnan, for intervener No. 4.

B. Datta, for intervener No. 5.

The Judgment of Sikri, C. J., Ray, Palekar and Dwivedi, JJ. was delivered by Ray, J. Beg, J. gave separate Opinion.

RAY, J.-The question which falls for determination in this appeal by special leave is whether the respondent is entitled to declaration in suit filed by her that her dismissal by the appellant municipality referred to as the municipality was illegal and void.

The respondent was an employee of the municipality. Her services were terminated by resolution dated 23 March, 1955. She. was dismissed from service. She filed this suit for declara-tion . that the resolution of the municipality dismissing her from service was void and that she continued to be in service of the

municipality and was entitled to emoluments from the date of the resolution up ~o the date of the suit.

The Municipality is goverened by the Bombay District Muni-cipalities Act, 1901 referred to as the Act. Sectic;>n 46 of the Act provides that the municipality shall make rules in respect oi mat-B ters enumerated in that section. Clause (g) of section 46 empowers the municipality, to frame rules regulating inter alia the period of service, the conditions of service etc.

Rule 183 framed by the municipality provides that except in the case of Chief Health Officer and the Engineer every municipal officer or servant is liable to be discharged at one month's notice. Rule 183 was not invoked by the municipality in 'the present appeal. Therefore, rule 183 is out of consideration.

Rule 143 of the municipality provides two things. First, no officer or servant shall be dismissed without reasonable oppor-tunity being given to him of being heard in his defence. Any written statement tendered shall be recorded and written order shall be passed thereon. Second, every order of dismissal or con-firming dismissal shall be in writing and shall specify the charge or charges brought, the defence and the reasons for the order.

Sometime in February 1955 one Nayak brought his wife Nagarnma to Pandit Cottage l{ospital administered by the muni-E cipality. Nagamma was admitted to the maternity section. , On 15 February 1955 Nagamma died.

Nagamma's husband complained to the municipality against the negligence of the staff of the hospital as the cause for the death of Nagamma. The Civil Surgeon held an enquiry. He gave finding that the death of Nagamma was not due to the negligence of the staff. There was public agitation for fresh enquiry.

On 7 March 1955 the municipality passed resolution appoint-ing committee of four persons to hold an enquiry into the cause of the death of Nagamma and the alleged negligence of the staff of·the hospital. The committee recorded the statements of several persons. The committee submitted its report to the Municipal Council.

On 23 March 1955 meeting of the Municipal Council ~'as held. The respondent alleged that though the consideration of the report of the sub-committee and the taking of decision thereon II were not inc~uded in th~ agenda of that meeting, yet the President of the Council sent nouce to the respondent. The communication to the respondent was to the effect that it had come to the notice of the President that the death of Nagamma was due to the negli-

gcnce of rthe respondent, and, therefore, she was to appear before the Municipal Council at 4 p.m. on 23 March 1955 and give )\er explanation. The respondent received notice on 23 March, 1955 at about 10.30 a.m. She sent her reply denying her negli· gence. The respondent also stated that if it was necessary for !J.er to explain anything she should be asked questions in writing and she would give her answers in writing.

The respondent did not appear before the Municipal Council at 4 p.m. The respondent came to !he municipal hall at about 6 p.m. But that rtime, the Municipal Council had passed resolu· tion dismissing the respondent from service. The President asked the respondent what her statement was about negligence. The respondent did not make any oral sfatement. The respondent insisted that the charge ·against her should be given in writing and that she would reply in writing. The municipality did not acceds to the respondent's request. The resolution of the municipality was communicated to the respondent on the same day. The res-pondent handed over charge on 24 March 1955.

Broadly stated, the two contentions of :the respondent were these. First, rule 143 of the municipality was violated. She was not given reasonable opportunity of defending herself against the charge. Second, the resolution was passed by the municipality on day when the agenda before the municipality did not contain any subject of dismissal of the respondent. On these grounds the respondent filed suit for declaration that the resolution was illegal, that the status of the respondent as mid-wife in the hospital remained unaffected and that the respondent was an employee of the municipality as !Jiefore. The respondent claimed other reliefs.

The contention of the municipality on the other hand was that the rules and bye-laws of the municipality were only for the guid-ance of the municipality and that the respondent could not chal-lenge the resolution or action of the municipality on the ground of violation of rules and bye-laws.

The High Court upheld the findings of the trial Court and the first Appellate Court that the respondent was not given reason-able opportunity of defending herself against the charge on which she was dismissed and that the municipality thus violated rule 143. The High Court however did not accept the finding of the courts , below that the Municipal Council was not competent to pass the resolution on the ground of want of notice on the agenda. The High Court also set aside the findings ol the courts below that the charge had not been proved against the respondent. The High Court found that the resolution of the municipality was c~ · in violation of rule 143 and declared it as invalid and inopeiative;

The High Court maintained the declaration tha:t the respondent was deemed to have continued in service from the date of dis-missal to the date of the suit.

Counsel on behalf of the municipality contended that the res-pondent was not entitled to any declaration. In short, it was said on behalf of the municipality that if the dismissal was wrongful the remedy lay in damages.

The cases of dismissal of servant fall under three broad heads. The fir5t head relates to relationship of master and servant governed purely by contract of employment. Any breach of con-tract in such case is enforced by suit for wrongful dismissal and damages. Just as contract of employment is not capable of specific performance similarly breach of contract of emvloY1Dent is not capable of founding declaratory judgment of subsistence of employment. declaration of unlawful termination and resto-ration to service in such case of contract of employment would be indirectly an instance of specific performance of contract for personal services. Such declaration is not permissible under the Law of Specific Relief Act.

. The second type of cases of master and servant arises under Industrial Law. Under That branch of law servant who is wrong-fully dismissed may be reinstated. This is special provision under Industrial Law. _This relief is departure from the reliefs available under the Indian Contract Act and the Specific. Relief Act which do not provide for reinstatement of servant.

The third category of cases of master and servant arises in regard to the servant in the employment of the Sta:te or of other public or local authorities or bodies created under statute.

Termination or dismissal of what is described as pure oon-tract of master and servant is not declared to be nullity however wrongful or illegal it may be. The reason is that dismissal in breach of contract is remedied biy damages. In the case of servant of the State or of local authorities or statutory bodies, ·courts have declared in appropriate cases the dismissal to be invalid if the dismissal is contrary to rules of natural justice or if the dismissal is in violation of the provisions of the statute. Apa~t from the intervention of statute there would not be declaia'lion of nullity in the case of termination or dismissal of servant of the State or of other local authorities or statutory bodies.

The courts. keep the State and the public authorities within the limit~ of their statutory powers. Where State or ·a public authority dismis.~ an employee in violation of the mandatory procedural requirements or an grounds which are not sanctioned

or suppol'ted by statute the courts may exercise jurisdiction to declare the act of dismissal to be nullity. Such implication of public employment is thus distinguished from private employment in pure cases of master nnd servant.

Counsel on behalf of the municipality relies on the decisions of this Court in Executive Committee of U.P. State Warehousing Corporation limited v. Chandra Kiran Tyagi (1970) 2 S.C.R. 250 and Indian Airlines Corporation v. Sukhdeo Rai (1971) 2 S.C.C. 192 in support of 1the contention that even in cases· cf statutory authorities or bodies dismissal would only sound in damages and not entitle the dismissed servant to the relief of declaratory judgment against the order of dismissal or termina-tion.

In Tyagi's case (supra) the Warehousing Corporation was competent to make regulations not inconsistent with the Agricul-tural Produce (Development and Warehousing) Corporation Act, 1956. The Warehousing Corpor®.on framed regulations. Regulation 11 dealt wrth termination of the service al an employee other than b!y way of punishment. Regulation 16 dealt with penalties imposed on servant. Regulation 16(3) s1ated that no punishment other than fine, censure or postponement of incre-ments or promotion was to be imposed on an employee without giving him an opportunity for tendering an explanation in writing and cross examining the witnesses against him and of. producing evidence in defence. Tyagi in that case complained that at the enquiry he was not given opportunity to adduce evidence in defence and 1he persons from whom the Enquiry Officer gathered information were not tendered for cross-examination. The ques-tion for consideration by this Court in that case was whether the dismissal of Tyagi could support the grant of declaration that the dismissal was null and void and that Tyagi was entitled to be reinstated. This Court held that an order made in breach of regulation 16(3) was not in breach of any statutory obligation. It was also held in Tyagi's( [1]) case (supra) that the relevant Act did not 'guarantee any statutory status to Tyagi' nor did it 'impose any obligation' on the Warehousing Corporation in the matter of dismissal. The ratio in Tyagi's([1]) case (supra) was that violation of reeulation 16(3) was breach al terms and cOn-ditions of relationship of master and servant and the master was liable for damages for wrongful dismissal. This Comt did not find any violation of statntCl'.'y obligation in Tyagi's([1]) case (supra).

In the Indian Airlines Corporation case (supra) Sukhdeo Rai was suspended on certain charges. Later on he was found quilty of those charges in an enquiry. He was thereafter dismissed. He filed suit alleging that the enquiry had been conducted in breach of the procedure laid down by regulations made by the Corporation under section 45 oi the Act, and, therefore, the dis-B missal was illegal and void. The High Court held that the Cor-poration was under statutory obligation to obServe the procedure laid down in the regulations and gave the relief of declaratory judgment. This Court set aside the declaration granted by the High Court. The ratio in Indian Airlines Corporation case was st:rted · thus :

"The employment of the respondent not being one to an office or status and there being no obligation or restriction in the Act or the rules subject to which only the power to terminate the respondent's employment could be exercised, could the respondent contend that he was entitled to declaration that the termination of his employment was null and void ?" ·

In the Indian Airlines Corporation case (supra) regula-tions framed under section 45 of the Act were said by this Court to be terms and conditions of service but the same did not consti-E tute statutory restriction as to the kind of contracts ·which the Corporation could make with the servants or he ground on which it could terminate. The dismissal in ithat case was found to he wrongful and not to fall within the vice of infraction of statutory limitation or statutory obligation.

This Court in S. R. Tewari v. District Board Agra (1964) 3 S.C.R. 55, Life Insurance Corporation of India v. Sunil Kumar Mukherjee (1964) 5 S.C.R. 528, Calcutta Dock Labour BOlll'd v. Jaf]ar Imam & Ors. (1965) 3 S.C.R. 453 and Narain-das Barot v. Divisional Controller, S.T.C. (1966) 3 S.C.R. 40 dealt with power of statutory authorities and bodies to dismiss servants. These decisions establish that the dismissal of servant by statutory including local authorities or bodies in breach of the provisions of the statutes or orders or schemes made under the statute which regulate the exercise of their power is invalid or ultra vires and the principle of pure master and servant contractual relationship has no application to such cases.

In Tewari's case (supra) this Court said that dismissal, te-moval or reduction of an officer or servant might be effected under

the rules only after giving the servant reasonable opportunity of showing cause against the action proposed to be taken. This Court held in Tewari's case (supra) that in three instances dismissed employee might in ~ppropriate cases o1'tain declara-tory judgment that the dismissal was wrongful. Those three ins-tances are : first, cases of public servants falling under Article 3I1 (2) of the Constitution; secondly, cases falling under the In-dustrial Law and, thirdly, cases where acts of statutory bodies are in breach of mandatory obligation imposed by statute.

In Naraindas Barot's case (supra) this Court held that the order of tem1ination was bad in law since it contravened the pro-visions of clause 4(b) of the regulation and also the principles of natural justice.

This Court has held in the decisions referred to that the dis-missal or termination of the services of employees without com-plying with the provisions of statute or scheme or order is invalid. This Court has quashed the orders of dismissal and granted appro-priate declarations.

There have been recent English decisions on this subject. These are Vine v. National Dock Labour Board (1956) 3 All E.R. 939; Barber v. Manchester Hospital Board (1958) 1 All E.R. 322; Ridge v. Baldwin 1964 A.C. 41; Malloch v. Aberdeen Corporation (1971) 2 All E.R. 1278 and McClel-land v. Northern lreland General Health Services Board (1957) l W.L.R. 594.

These decisions indicate that statutory provisions may limit the power of dismissal. Where such limitation is disregarded dis-missal may be held invalid. In this respect employment under statutory bo,dies differs from ordinary private employment. Where public body is empowered to terminate employment on specified grounds or where public body does not observe the procedure laid down l\Y legislation e.g., improperly delegates power of dis-missal to another body the courts have declared such dismissal from public employment to be invalid.

The cases of statutory status of an employee can be also form the subject matter of protection of the rights of an employee under the statute. In Vine's case (supra) the removal of Vine's name from the register was held to be nullity. The statutory scheme of employment was held to confer on the worker status.

An unlawful act of the Board was found to be interference with status. The status of ·the dock worker was recognised by this in J11ffar Imam's case (supra). In Jaffar Imam's case (supra) the t~nnination of the employment in breach of clause 36(3) of the scheme made by the Central Government in exercise of the power conferred on it by section 4( 1) of the Dock Workers (Re-B gulation of Employment) Act 1948 was held to be bad. The ground given by this Court was that before any disciplinary action was taken under clauses 36( 1) and (2) of the scheme in Jaffar Imam's case (supra) th~ person concerned was to be given an opportunity to show cause as to why the proposed action should not be taken against him.

Again in Barber's case (supra) under the memorandum issued by the Minister of H:ealth the Hospital Board was not to carry into effect the dismissal of consultant before certain appeal procedure had been completed. Barbar was dismissed without the prescribed procedure being followed. It was held that despite the 'strong statutory flavour ~ttaching to the plaintiff's contract' this was an ordinary contract between master and servant. The House of Lord in McC/e/land's case held that the dismissal of the plairrtiff by the Board in that case on the ground of redundancy of staff was not one of the grounds specified in the tenns and con-ditions of service. It was found that the dismissal could be on specified grounds e.g .. , gross miscouduct. declaration was granted in favour of McClelland on an originating summons as to whether the agreement of service was validly tenninated. It was not case of Government servant. There was no question of breach of statutory provisions. The employment was based on contract. The Court found that the express power of the Board did not include reduction on the ground of redundancy. The Court spelt out security of status in employment. The legal basis of the decision in McClel/and's case (supra) is that the post was terminable only on certain specified grounds.

In the present appeal, the pre-eminent question is whether the dismissal is in violation of rule 143. Rule 143 imposes mandatory obligation. The rules were made in exercise of power conferred on the municipality by statute. The rules are binding on the muni-cipality. They cannot be amended without the assent of the State Government. The dismissal of the respondent was rightly found by the High Court to be in violation of rule 143 which imposed mandatory obligation. The respondent was di~missed without reasonable opportunity of bein~ heard in her defence. The dis-missal by the municipality was without recording any written

(1973] 3 S.C.R.

statement which might have been tendered. The dio.missal by the municipality was without written order. The dismissal was ultra vires ..

For the foregoing reasons the High Court was correct in declaring the dismissal of the respondent to be illegal anq void. The appeal is therefore dismissed. Jn view of the fact thL1 court directed the appellant would in any event pay the respon-dents' costs, 1he Respondent will be pai1 these costs.

BEG, J.-The facts of the case before us, which are so clearly set out in the judgment of my learned Brother Ray, need not be repeated by me. I respectfully concur with what has fallen from my learned brother. I would, however, like to add some obser-vation on two aspects of the case before us.

Firstly, it was suggested, on behalf of the Municipality, that the local authority had some kind of dispensing power which could enable it to over-ride Rule 143 in the circumstances of the Il case before us. Rule 143 of the Sirsi Murticipality, reads as follows :-

"Rule 143 (I). No officer or servant be dismissed without reasonable opportunity cieing given to him of being heard in his defence. Any written defence ten-dered shall be recorded and written order shall be passed thereon.

;2) Every order of dismissal or confirming dis-mbsal shall be in writing and shall specify the charge or charges brought, the defence and the reasons for the order".

This suggestion was based on the provisions of Section 26, sub. s(8) of the Bombay District Municipal Act 1901 (herein-after referred to as "the Act") which has ,really nothing to do with any general power to disperse wi1h the application of any rule. All that Section 26, sub. s(8), empowers the Council to do is to take up matter for consideration and discussion with the per-mission of the Presiding authority even though it may not have been tabled on 'the notified agenda for the meeting. This provi-sion reads as follows :

"26 ( 8). Except with the permission of the presiding

authority, which permission shall not ijl given in the case of motion or proposition to modiiy or cancel anv reso-lution within three months after the passing thereof. no business shall be transacted and no propositiorvshall be

discussed at any general meeting unless it has been men-uoned in the notice convening such meeting .or, in the case of special general meetmg, in the written request for such meeting. The order in which any business that may be transacted or any proposition that may be dis-cussed at any meeting in accordance with this sub-section shall be brought forward at such meeting, shaU be determind by the presiding authority, who in case it is proposed by any member to give priority to any parti-cular rtem of such business, or to any particular proposi-tion shall put the proposal to the meeting and be guided by the majority of votes given for or agaill.9t the proposal".

Section 26, sub. s. ( 8), seems initially to have been relied upon only to meet the argument that the impugned resolution could not be passed in the absence of previous notice of it to the Members of the Council. The competence of the Municipal Council to pass the resolution dismissing the respcindent depended more on compliance with Rule 143 made under Section 46 of the Act than on Section 26 ( 8) of the Act. Compliance with such rule could not be dispensed with by the Council or its presiding authority under Section 26 (8) of the Act.

The mode and conditions of appoi_ntment, punishment, and dismissal of officers and servants of the Municipality were meant to be regulated by rules which had to ~ approved by the State Government in the case of the City ¥unicipalities and by the Com· missioner in other cases before they could become binding or be altered. Bye-laws could be made on certain specified subjects only after the previous sanction of the State Government or the Com· missioner, as the case may be, given to them. Neither rules nor bye-laws of the Municipality could be made or altered unilaterally by it. Both operated as laws which bound the local authority. This was clear from the provisions of Section 46 and 48 of the Act.

In Yabbicon v. King(') it was said :

"The District Council could not control the law, and b!y~Iaws properly made have the effect of laws; public body cannot any more than privl!te persons dispense with laws that have to be administered; they have no dis-pensing power whatever".

Again in William Feam & Sons. v. Flaxton Dural Council(') Sankey, L. J., held that local authority has "no power" to con-H travene its own bye-laws properly made. In Kruse Vs. Johnson('), (I) (1-899) (I (1-899) (I (I Q.B. 444 (a). (a). (2) (1929) (I K. B. 4SO @ 467).

(I) (1-899) (I (1-899) (I (I Q.B. 444 (a). (a).

(3) (1898) (2 Q.B. 91).

[1973] 3 S.C.R.

JGO

Lord Russel pointed out that bye-law has the "force of law" within the sphere of its legitimate operation.

Therefore, quite apart from the basic character of Rule 143 as procedural protection against un-meritted punishment by dis-missal of servants of the Municipality, I think that the local body was not competent to act upon the assumption that it had any po:-ver to dispense with compliance with this rule so long a& it stood unaltered.

Secondly, the question arose whether the violation of Rule 143, which admittedly took place, made the dismissal of the res-pondent merely illegal, for which award of damages was sufficient remedy, or m~tje it void and ineffected, so that declaration of the rights of_ the respondent as servant of the Municipality could also be given despite the provisions of Section 21 Specific Relief Act. It is true that, ordinarily, Co1c1rt will not give declaration which will have the effect of enforcing contract of personal service and will restrict relief to the injured party to damages for breach of contract. But, the principles which are applicable to the relation of private master and servant, l!n-regulated by statute, could not apply similarly to the case of public statutory body exercising powers of punishment fertered or limited by statute and relevant rules of procedure.

Although Indian Airlines Corporation v. Sukhdeo Rai([1]), which was cited on behalf of the appellant, could perhaps be dis· tinguished on facts, I am unable to reconcile the decision of this Court in the case of Executive Committee of U.P. State Ware· housing Corporation Ltd. v. Chandra Kiran Tyagi('), with our view in the case before us. In Tyagi's case (supra), as in the case be.fore us, no express statutory provision was contravened by the impugned dismissal, but rule, made under. powers conferred by statute, which protects the servant concerned from punishment bv way of dismissal contrary to rules of natural justice, was violated. If guaranteed "statutory status" means only an express statutory p,rellection, such as the one found in Article 311 of 1he Constitution, and rule made under statutory power is not enough to confer it, there was none either in T,vagi's case. (supra) or in the case before us. An express statutory provision or guarantee is not the only basis of mandatory duty or obligation. It can be imoosed either by rule made in exercise of statutorv oower or it may arise by implication when exercising qu'asi-judicial functions.

Even when there was no specific rule on the subject. like Rule 143 in the case before us, this' Court has held that violation cf ita1·

(I) [19711 S·1p,, S.C.R. 510.

(3) (1970J (2) S.C. R. 250.

51RSI MUNIC. V. KOM FRANCIS (Beg, J . .)

plied rules of natural justice, iii exercise of quasi-judicial statutor: power, results in a· legally void decision. It was so held because the obligation to observe .~ules of natural justice was imperative in such situation. In State of Orissa v. Dr. (Miss) Bi11apa11i Rai('), this Court said :

"The rule that party to whose prejudice an order is intended to be passed is entitled to hearing applies alike 10 judicial tribunals and bodies of persons invested with authority to adjudicate upon matters involving civil consequences. It is one of the fundamental rules of our constitutional set up that every citizen is pro-tected against exercise bf arb:itrary authority by the State or its officers. Duty to act judicially would, 'therefore, arise from the very nature of the function intended to be performed; it need not be shown to be super-added. If there is power to decide and determine to the prejudice of person, duty to act judicially is implicit in the exercise of such power. If the essentials of justice be ignored and an order to the prejudice of person is made, the order is nullity. That is basic concept of the rule of Jaw and importance thereof transcends the significance of decision in any particular case".

This principle would be equally applicable to local Government bodies which fall within the definition of "State" given in Artkl~ 12 of the Constitution.

Byles, J., in Cooper v. The Board of Works for We11dswor1/1 District('), said long ago about the primordial character of the opportunity to be heard before punishment :

"The laws of God and man both give the party an opportunity to make his defence, if he has any. I re-member to have heard it obseryed by very learned man, upon such an occasion, that even God himsell did not pass sentence upon Adam before he was called upon to make his defence. 'Adam' (says God) 'where art thou ? Hast thou not eaten of the tree whereof I com-G manded those that thou shouldst not ear?"'

Such principle has been described as principle of "Universa jurisprudence" by Mahomood, J., in Queen Empress v. Po11hi(" l

Tn Ridge v. Baldwin(') Lord Reid observed (at page 71) "The authorities ·on the applicability of the Princi-ple& of natural justice are in some confusion and so I

(I) \196'.IJ (2) S.C::.R.625. 12) 0863) 14 C.N.S.180. (3) .L.R. 13 Alld. 171. (4) 1964 A.C. <IO@ 65.

[1973] 3 s.c.R.

find rt necessary to examine this matter in some detail. The principle audi a/teram partem goes back many c.en-tunes in our law and appears in multitude of judg-ments of judges of the highe!lt authority. In ,modem tlliles opinions have sometimes been expressec> to the eltect that natural justice is so vague as to be practically meaningless. But I would regard these as tainted by the perennial fallacy that because something cannot be cut and dried or ni~ly' weighed or measured therefore it does not exist. The idea of negligance is equally insus-ceptible of exact definition but what reasonable man would regard as fair procedure in particular circums-tances and what he would regard as negligance in parti-cular circumstances are equally capable of serving as tests in law, and natural justice as it had been interpreted in the coul'ts is much more definite than that. It appears to me that one reason why the authorities on natural jus-tice have been found difficult to reconcile in that insuffi-cient attention has been paid to the great difference bet-ween various kinds of cases in which it has been sought to apply the principle. What minister ought to do in considering objections to scheme may be very diffe-rent from what watch committee ought to do in consi-dering whether to dismiss chief constable. So I shall deal first with cases of dismissal. These appear to fall in.to t11ree classes, dismissal of. servant by his master, dismissal from an office held during pleasure, and dis-missal from an office where there must be something against man to warrant his dismissal".

The case before us undoubtedly falls within the category of cases where dismissal must be based upon decision arrived at quasi-judicially about wrong done by the servant. This elementary and basic procedural safeguard flows not merely from an implied rule of na'lural justice, but, in the case l:lefore us, it is actually embodied in rule which we cannot interpret as anything other than legal limitation or fetter on the power of the Municipal authority to dismiss. It constitutes condition pre-cedent to valid decision to dismiss whether contained in reso-lution or an order of the local authoritv. As the local Government authority had failed to see that mandatory duty, embodied ill basic rule, had been carried out. the resulting decision must neces~arily be held to be void.

If the c;lecision to dismiss the resnondent was vnid and inooera-t.i ve in law, there seems no reason whv declaration to that effect be not granted. Such case would be covered by the principles

SlllS! MUN!C, V. KOM FRANCIS (Beg, J,)

laid down by this court in. : Life Insurance Corporation of l ndia v. Sunil Kumar Mukherjea & 019.([1]) and S, P. Tewari v. District Board Agra & Anr. ('). This could not be case in which damages for simple breach of contract could afford ade-quate relief. Damages could not wipe oft the stigma attached to the record of the servant. The law requires that, before the future of servant is allowed to be marred by blot on the record of the servant concerned, rules ol natural justice must be complied with. I,· therefore, concur with the judgment and the order proposed by my learned Brother Ray.