Nanik Awatrai Chainani Vs. Union of
India  INSC 142 (20 July 1970)
20/07/1970 [A. N. RAY AND I. D. DUA, JJ.]
Indian Railways Act (9 of 1890), ss. 3(7),
138 and 148(2) and Art. 311 of the Constitution-Licensee of Railway stallWhether
railway servant-Termination of agreement-Rights of licensee-Whether entitled to
benefit of Art. 311Relationship of master and servant.
The appellant was running two stalls-a tea
stall and a refreshment stall-at a railway station. They were allotted to him
by the Railway administration under two separate identical agreements of
different dates, which provided that the appellant was to run the stalls in
accordance with the directions of the Railway administration and among other
terms for termination of the agreements, they were also terminable by one
month's notice on either side without assigning any reason. As the appellant
had committed certain irregularities in running the stalls, a fine was, imposed
on him in terms of the agreements. Since the fine was not paid he was given
notice to vacate and when he failed to do so, the agreements were terminated,
and possession was sought to be secured through the Magistrate under s. 138 of
the Indian Railways Act. The appellant moved the Sessions Court and High Court
on revision but without success, In appeal to this Court,
HELD : (1) In view of the fact that the terms
of the agreements which govern the parties expressly reserve to the Railway
administration extensive power of directing and regulating the appellant's work
and also of controlling the manner of doing the work, which is necessary for
affording 'amenities to the travelling public, the appellant would be a railway
servant as defined in s. 3(7) read with s. 148(2) of the Indian Railways Act,
against whom action can be taken under s. 138. [S. L. Puri v. Emperor, A.I.R.
1937 Lahore 547 and R. L. Mazumdar v. Alfred Ernest, A.I.R. 1959 Cal.
64, approved.] [655 D-F] (2) By reason of
being a railway servant the appellant did not automatically become entitled to
the protection afforded to Government servants by Art. 311 of the Constitution.
He was neither a member of the civil service as contemplated by this Article
nor was he dismissed, re-moved or reduced in rank so as to attract Art. 311(2).
His rights are confined to the terms of the written agreements and if he
considered that they had been wrongfully terminated, he could challenge such
termination in civil courts under the law. [654 E-G] (3) The express terms of
the appellant's agreements exclude the heritable character of his right which
is only a contractual right of a bare licensee subject to the terms of the
agreement. No right outside these can be claimed by him. The fact that the
appellant. was allotted the stalls in order to rehabilitate him as a displaced
person from Pakistan cannot over-ride the terms of the agreements and absolve
him of his obligations thereunder and permit him to avoid the consequences of
the alleged breaches of agreements on his part., [655 B-D, G-H] 651 (4) Merely
because a judicial Magistrate passed the order under s. 138, Indian Railways
Act, five days after the dismissal of the appellant's. application under Art.
226 of the Constitution by the Gujarat High Court does not establish malice on
the part of the Magistrate. [656 A-B] (5) The relationship of master and
servant is characterised by agreement of service, express or implied, and
whether or not a given agreement is one of service is a question of fact
depending on its terms considered as a whole. [655 H]
CRIMINAL APPELLATE JURISDICTION: Criminal
Appeal No.51 of 1970.
Appeal by special leave from the order dated
October 23, 1969 of the Gujarat High Court in Criminal Revision No. 407 of
The appellant appeared in person.
S. P. Nayar, for the respondent.
The Judgment of the Court was delivered by
Dua, J. In this appeal by special leave the appellant who has appeared in
person challenges the order of a learned single Judge of the Gujarat High Court
(Shelat J.) dismissing in limine criminal revision against the, order of the
Sessions Judge dated October 4, 1969 dismissing the appellant's revision from
the order of the Judicial Magistrate, Kalol dated August 30, 1969 granting the
application of the railway administration under S. 138 of the Indian Railways
Act and directing the P.S.I. Railways at Sabarmati who is also the P.S.I.
Railways at Kalol to secure possession of the stalls in question from the
appellant to the railway administration or to the person appointed by the
administration in that behalf.
The appellant had, on February 9, 1964,
entered into an agreement with the railway administration by means of which he
was allotted a Tea Table (hereafter described as Tea Stall) at Katol railway
station. This agreement came into force from may 18, 1964 and subject to the
provisions for earlier termination was to remain in force for three years.
By a similar agreement dated February 20.
1965 the appellant was allotted a Refreshment Stall at the same railway station
for a period of three years subject to the provision for earlier termination
similar to the first agreement. In both the agreements the appellant was
described as the licensee.
Under these agreements the terms of which are
identical the appellant was to run the two stalls in accordance with the
directions of the railway administration. In addition to other terms for
earlier termination, the agreements were also terminable under clause 52 by one
month's notice on either side without assigning any reason. On July 11, 1965
652 the two Stalls were inspected by the Commercial Inspector and the Station
Master and it was found that the appellant had committed irregularities and was
not running them in accordance with the directions of the railway
administration. A fine of Rs. 100 was imposed on him in terms of the agreement,
the fine being payable within one week under cl. 38(a). The amount of fine
having not been paid within the stipulated period a notice was given to the
appellant on September 16, 1965 for vacating 'the railway premises by October
30,,1965. The appellant having failed to vacate the premises, the agreements
were terminated with effect from November, 1965.
As the possession of the Tea and Refreshment
Stalls was not delivered by the appellant to the railway administration, the
latter applied to the Judicial Magistrate, Kalol under s. 138 of the Indian
Railways Act for securing possession of the aforesaid 'premises. Before the
Magistrate it was not disputed that since the appellant had to work under the
supervision and according to the directions of the railway administration he
was a railway servant. This, according to the learned Magistrate, was not
denied by the appellant even in his written statement; on the ,other hand it
was claimed that the position of the appellant was at par with that of the
railway servants. The appellant contested the application principally on the
ground that the contracts of the Tea and Refreshment Stalls had been entered
into with the appellant with the object of rehabilitating him as a displaced
person from Pakistan and that, therefore, those contracts could not be
terminated. After a lengthy discussion on the points raised the learned
Magistrate expressed his final conclusion in these words:
"The opponent is proved to be railway
Also it is proved that his service has been
lawfully discharged. Mr. Thakursingh, the learned advocate for The opponent has
contended that the applicant has terminated the agreement without any
justification and without assigning any reason. But that is not required to be
done by either party to the agreement. It is argued by Mr. Thakursingh that the
opponent is prepared to pay arrears of licence fees to the tune of Rs. 4,000 or
so and he is prepared to pay the same to the railway. But that is not a good
ground to disallow the application. Section 138 of the Railways Act provides
for summary remedy for delivery to Railway Administration of property detained
by a railway servant. The opponent who is proved to be a discharged railway
servant refuses to deliver the stall and the place on which he is permitted to
place a tea table though served 653 with notice. Hence he is liable to be
summarily evicted. He has prolonged the matter for unreasonably long period
under different excuses. His services are terminated and so he has occupied the
stall and the place for table unauthorisedly. . . ." Reliance for holding
the appellant to be a railway servant was placed on S. L. Puri v. Emperor(').
The appellant took tile matter in revision to
the court of the Sessions Judge. There the appellant denied that he was a railway
servant and-urged as an alternative submission that even if he was a railway
servant he had not been validly discharged. In any event, so proceeded his
contention, no notice to deliver possession of the Stalls having been given to
him before filing the application under s. 138, he could not be dispossessed
through the court. The Sessions Judge did not agree with these submissions and
held that termination of the contract amounted to the appellant's discharge
and, therefore, proceedings could lawfully be initiated against him under s.
138 -of the Indian Railways Act for summary delivery of property, in his
possession or custody, to the railway administration. The appellant was held to
'have become a railway servant by virtue of ss. 3 (7) and 148 (2) of the Indian
Railways Act. The Sessions Judge relied for his view both on S. L. Puri's
case(') and R. L. Majumdar v. Alfred Ernest('). A revision to the High Court,
as noticed earlier, was dismissed in limine.
On appeal in this Court the principal point
urged by the appellant is that by reason of being a railway servant he was
automatically entitled as a matter of law to the protection afforded to
Government servants by Art. 311 of the Constitution. This, submission is wholly
Article 311 is in the following terms .
"(1) No person who is a member of a
civil service of the Union or an all-India service or a civil service of a
State or holds a civil post under the Union or a State shall be dismissed or
removed by an authority subordinate to that by which he was appointed.
(2) No such person as aforesaid shall be
dismissed or removed or reduced in rank except after an inquiry in which he has
been informed of the charges against him and given a reasonable opportunity of
being heard in respect of those charges and where it is proposed, after such
inquiry. to impose on him any such penalty, until he has been given a
reasonable opportunity of (1) A.I.R. 1937 Lahore 547.
(2) A.T.R. 1959 Cal. 64.
654 making representation on the penalty
proposed, but only on the basis of the evidence adduced during suck inquiry
Provided that this clause shall not apply(a) where a person is dismissed or
removed or reduced in rank on the ground of conduct which has led to his
conviction on a criminal charge; or (b) where the authority empowered to
dismiss or remove a person or to reduce him in rank is satisfied that for some
reason, to be recorded by that authority in writing, it is not reasonably
practicable to hold such inquiry; or (c) where the President or the Governor, as
the case may be, is satisfied that in the interest of the security of the State
it is not expedient to hold such inquiry.
(3) If, in respect of any such person as
aforesaid, a question arises whether it is reasonably practicable to hold such
inquiry as is referred to in clause (2), the decision thereon of the authority
empowered to dismiss or remove such person or to reduce him in rank shall be
final." A plain reading of this Article would show that the appellant cannot
claim its benefit. The appellant is neither a member of the civil service as
contemplated by this Article nor has he been dismissed, removed or reduced in
rank so as to attract the protection of sub-Art. (2) of this Article. The
appellant's rights are clearly confined to the written agreements and if he
feels aggrieved by anything done by the railway administration which he
considers to be in breach of the terms of the agreements, he is at full liberty
to seek redress in accordance with law in the ordinary civil courts. In other
words, if he considers that his agreements have been wrongfully terminated then
he can challenge such termination in the civil courts and claim whatever relief
is available to him under the law.
So far as the impugned order of the High
Court and the order of the Sessions Judge is concerned we are unable to find
any legal infirmity which would justify interference by this Court under Art.
136 of the Constitution. The relationship of master and servant is
characterised by agreement of service, express or implied, and whether or not a
given agreement is one of service .is a question of fact depending on its terms
considered as a whole.
655 Indeed, it is not the appellant's case
before us that he was not a railway servant. On the contrary, the main plank of
his challenge is that as a railway servant he is entitled to claim the
protection of Article 311 of the Constitution. This submission, as already
observed by us, is clearly based on a misunderstanding of the scope and effect
of that Article.
The appellant's next submission that the two
agreements mentioned above clothed him with an independent vested right to do
his business of running the two stalls in question, which right is heritable
and not open to termination is equally misconceived and unacceptable. The
express terms of the agreements exclude the heritable, character of the
appellant's right. The only right which the appellant could claim is a
contractual right of a bare licensee and that right is subject to the terms
contained in his agreements.
He cannot claim any right outside or beyond
those agreements. The terms which govern the parties expressly reserve to the
railway administration extensive power of directing and regulating the
appellants work and also, to an extent, of controlling the manner of doing the
Keeping in view the purpose and object of
these agreements, namely, that of affording necessary amenities to the
travelling public, retention of this overall power by the railway
administration is not only appropriate but necessary. The retention of this
power by the railway administration, in our view, constitutes relevant material
for sustaining the conclusion of the courts below that the appellant is a
railway servant, as defined in s. 3(7) read with s. 148(2), Indian Railways
Act, against whom action can be taken under s. 138 of the said Act. This
conclusion is in accord with the view expressed in the decisions of the Lahore
and Calcutta High Courts to which reference has been made earlier. We do not
find any cogent ground for disagreeing with that view which seems to have
prevailed all these years. May be that the appellant was allotted two stalls
under the agreements with the object of rehabilitating him as a displaced
person. But that consideration cannot over-ride, the terms of the agreements and
absolve him of his obligations there under and permit him to avoid the
consequences of the alleged breaches of agreements on his part. In this appeal
we are not concerned with the question of violation of the terms of his
agreements by the appellant nor can we consider the legality of the termination
of his agreements. For that grievance the appellant has to seek relief
elsewhere by a different process.
It may, in this connection, be pointed out
that the appellant had also approached the Gujarat High Court by certiorari
challenging the order of fine imposed on him, relying on the objection that the
imposition of the fine was in violation of Art. 311 of 656 the Constitution.
This writ petition was rejected on August 25, 1969. In the special leave
application, the appellant has averred that the Judicial Magistrate passed the
order under S. 138 of the Indian Railways Act on August 30, 1969only five days
after the order of the High Court dismissing his writ petition.-and it is
contended that the impugned order must for that reason be held to have been
inspired by malice against the appellant. We do not find any warrant for this
The appellant had also filed several
miscellaneous applications in this Court which were dismissed by us after
hearing him. He wanted to summon some witnesses and also some documents for
proving that the allotment of the stalls had been made to him for the purpose
of rehabilitating him as a displaced person. We did not consider it necessary
to take evidence in this Court on that point. The written agreements, in our
view, conclude the matter. The appellant also sought adjournment of this appeal
on the ground that he wanted to engage a senior counsel to argue his appeal,
but that counsel could only appear after the summer vacation.
We did not consider that to be a sufficiently
cogent ground for adjourning the appeal, the hearing of which was expedited on April 13, 1970. The appellant also applied for referring this case to the Constitution
Bench because, according to him, the question raised was of great
constitutional importance. We did not find any cogent ground for acceding to
The appellant has, in his arguments, laid
repeated stress on the submission that the impugned action of the railway
administration would deprive him and his family of the only source of
livelihood. That consideration has little relevance because this appeal has to
be decided on the merits on the existing record in accordance with law. That
indeed is a matter between the appellant and the railway administration. Ms
request for allotment, we have no doubt, will be considered on its merits in
accordance with the law and the relevant departmental practice. It is not for
us in these proceedings to express any opinion on the merits of his claim.
This appeal fails and is dismissed.
V.P.S. Appeal dismissed.