TARUN CHUGH, CEO AND MANAGING DIRECTOR, BAJAJ ALLIANZ LIFE INSURANCE COMPANY LTD.versusSAROJ KUMAR PANDA

                  [2024] 9 S.C.R. 981 : 2024 INSC 821

            Tarun Chugh, CEO and Managing Director,
            Bajaj Allianz Life Insurance Company Ltd.
                                  v.
                        Saroj Kumar Panda
                       (Civil Appeal No. 12135 of 2024)
                              23 September 2024
             [J.K. Maheshwari and Rajesh Bindal,* JJ.]


                            Issue for Consideration
       Respondent No.1 filed a statement of claim before the Tribunal
       impugning his termination vide order dated 25.07.2017 – Tribunal
       passed ex-parte award dated 05.02.2019, the termination of the
       Respondent No.1 was held to be bad – Respondent No.1 was
       directed to be reinstated with back-wages and other service
       benefits – The aforesaid ex-parte Award was challenged by all the
       parties impleaded by the Respondent No.1 before the Tribunal,
       namely, the officers in person, without joining the company-employer
       as a party – The writ petition filed by the writ petitioners/appellants
       before the High Court, impugning the ex-parte Award of the Tribunal,
       was dismissed vide order impugned dated 01.03.2021 – Appellant
       approached the Supreme Court and filed an appeal against the
       order dated 01/03/2024 passed by the High Court – SC while
       setting aside the impugned order passed by the High Court and
       the Award of the Tribunal allowed the appeal.
       Whether proper impleadment of parties in any proceedings is sine
       qua non in the matter coming before the court.

                                   Headnotes†
       Practice and Procedure – Impleadment – Proper impleadment
       of parties in any proceedings is sine qua non in any matter
       coming before court – A corporate has a separate legal entity
       as compared to an individual or an officer of the company:
       Held: It needs to be appreciated that proper impleadment of parties
       in any proceedings is sine qua non in any matter coming before the
       court. However, what is noticed is that it has become a casualty
       in the process. Due care is not taken at the time of initiation of
       any proceedings before any forum to ensure that proper parties

* Author
982                                                               [2024] 9 S.C.R.

                              Digital Supreme Court Reports


       are impleaded. It needs to be appreciated that a corporate has a
       separate legal entity as compared to an individual or an officer of the
       company. There can be privity of contract between the corporate and
       any other individual and that contract or communication may have
       been signed by any officer on its behalf as an authorized signatory.
       It does not mean that the officer signing the communication or
       the agreement or the executive head of the company becomes
       individually liable for any claim against the company except the
       cases where any specific claim is made in that regard. Any order
       or decree or award passed by the Court, in case proper parties
       are not impleaded, becomes inexecutable. [Paras 10.1 and 10.2]

                                        List of Keywords
       Ex-Parte Award; Termination; Reinstate; Impleadment of Proper
       Parties; Privity of Contract; Separate legal entity.

                                       Case Arising From
       CIVIL APPELLATE JURISDICTION: Civil Appeal No. 12135 of 2024
       From the Judgment and Order dated 01.03.2021 of the High Court
       of Orissa at Cuttack in WP(C) No. 8877 of 2020

                                     Appearances for Parties
       Amol Chitale, Mrs. Shweta Singh Parihar, Sartak Sharma,
       Mrs. Pragya Baghel, Advs. for the Appellant.
       R. Balasubramanian, Sr. Adv., Karunakar Mahalik, B. Venkatraman,
       Debasish Mishra, Ms. Sanya Minhas, Advs. for the Respondent.

                      Judgment / Order of the Supreme Court

                                             Order
       Rajesh Bindal, J.

1.     Leave granted.
2.     The impugned order1 was passed by the High Court2 in Writ Petition3


1    Dated 01.03.2021
2    High Court of Orissa, Cuttack
3    W.P.(C)No.8877 of 2020
[2024] 9 S.C.R.                                                                      983

       Tarun Chugh, CEO and Managing Director, Bajaj Allianz Life
             Insurance Company Ltd. v. Saroj Kumar Panda

      filed by Tarun Chugh,4 Ruben Selvadoray5 and Prabir Ranjan Prusty6
      whereby the ex parte Award7 of the Tribunal8 was upheld.
3.    Initially the Special Leave Petition was filed by one of the writ
      petitioners, Tarun Chugh, however, while deleting the proforma
      Respondent Nos.2 and 3 from the array of the parties, as allowed vide
      order dated 30.06.2021, the name of the Petitioner in the Amended
      Cause Title annexed to the S.L.P. paper book is shown as ‘Bajaj
      Allianz Life Insurance Company Ltd.’ herein after referred to as ‘the
      Company’, which is different from the original Petitioner. This change
      was made without any order of the Court, hence, cannot be admitted.
4.    Briefly, the facts as available on record are that a statement of claim
      was filed by the Respondent No.1 before the Tribunal impugning his
      termination vide order dated 25.07.2017. Vide ex-parte Award dated
      05.02.2019 passed by the Tribunal, the termination of the Respondent
      No.1 was held to be bad. He was directed to be reinstated with back-
      wages and other service benefits. The aforesaid ex-parte Award was
      challenged by all the parties impleaded by the Respondent No.1
      before the Tribunal, namely, the officers in person, without joining
      the company - employer as a party. The writ petition filed by the writ
      petitioners/appellants herein before the High Court, impugning the
      ex-parte Award of the Tribunal, was dismissed vide order impugned.
5.    Learned counsel for the Appellant submitted that it is a case in which
      the matter was entrusted to the counsel for appearance before the
      Tribunal, but later he failed to take care of the proceedings of the
      case. The Officer in the Legal Department had left the management
      company on 26.09.2018 and the Officer in the Human Resource
      Department had left the management company on 24.05.2019
      respectively, i.e., during the pendency of the dispute before the
      Tribunal. It was under these circumstances that proper representation
      could not be made.
      5.1 The Respondent No.1 had failed to implead the employer with
          whom there may be privity of contract. Only the officers of the


4    CEO and Managing Director, Bajaj Allianz Life Insurance Co. Ltd.
5    Chief Human Resource Officer, Bajaj Allianz Life Insurance Co.Ltd.
6    Regional Head, Bajaj Allianz Life Insurance Co.Ltd.
7    Dated 05.02.2019
8    Central Government Industrial Tribunal, Bhubaneswar in I.D. Case No.86 of 2017
984                                                          [2024] 9 S.C.R.

                      Digital Supreme Court Reports


            company were impleaded. Such officers of the company had
            not engaged Respondent No.1 in their personal capacity. It
            was argued that the Respondent No.1 was initially appointed
            as Branch Accountant on 09.05.2006 by the Company.
            Thereafter, he was promoted as Senior Divisional Accountant in
            Grade L(IA) on 01.04.2009. He was redesignated as Business
            Supporting Officer (Managerial Post) w.e.f. 01.08.2014. He was
            transferred from Finance Department to Sales Administration
            w.e.f. 01.01.2015 and again from Agency Sales Administration
            to Agency Sales w.e.f. 15.05.2017. On account of Departmental
            restructuring resulting in changes in roles and responsibilities
            of different officers, the Respondent No.1 became surplus
            and redundant in the company and there being no alternative
            work available for his adjustment, however, his services
            were dispensed with, as per the terms of appointment and a
            communication was sent to the Respondent No.1 on 25.07.2017
            by the company. A sum of ₹ 1,07,787/- was transferred in his
            bank account in lieu of notice for termination. The Respondent
            No. 1 was earning a salary of ₹35,929/- per month, as was
            his last drawn salary for the month of June 2017. Further,
            it was argued that the Respondent No.1 was working on a
            managerial post, by no stretch of imagination he could be
            treated as workman, entitling him to invoke the jurisdiction of
            the Tribunal by raising an industrial dispute. The order passed
            by the Tribunal was totally without jurisdiction. This basic issue
            should have been examined by the Tribunal even on the facts,
            which were brought on record.
       5.2 The order of the Tribunal was challenged before the High
           Court placing the aforesaid facts and also explaining the lapse
           on the part of the counsel, who was later removed from the
           panel of the advocates engaged to conduct cases on behalf
           of the company. However, the writ petition was dismissed. The
           submission is that an opportunity be granted, and the matter
           may be remitted back to the Tribunal for re-examination on
           merits after impleadment of proper parties.
6.     On the other hand, learned counsel for the Respondent No.1
       submitted that after due service of notice, no one had appeared
       before the Tribunal, hence, they were proceeded against ex-parte.
       The management was well within knowledge of the pendency of the
[2024] 9 S.C.R.                                                            985

       Tarun Chugh, CEO and Managing Director, Bajaj Allianz Life
             Insurance Company Ltd. v. Saroj Kumar Panda

      matter before the Tribunal, hence,it cannot be allowed to take the
      plea that employer was not impleaded as such,as senior officers were
      already before the Tribunal, as such a hyper-technical submission
      deserves to be rejected. Once service to the Respondent No.1 before
      the Tribunal was complete, which is not disputed by the Appellant
      before this Court, there is no good reason for setting aside the Award
      of the Tribunal only because of the Appellant’s lapse in appearance.
      The appeal deserves to be dismissed.
7.    Heard learned counsel for the parties and perused the paper book.
8.    The facts as evident from the record are that the Respondent No.1
      was appointed as Branch Accountant on 09.05.2006. Thereafter,
      he was promoted as Senior Divisional Accountant in Grade L(IA)
      on 01.04.2009. He was redesignated as Business Support Officer
      (Managerial Post) w.e.f. 01.08.2014. Further, he was transferred
      from Finance Department to Sales Administration w.e.f. 01.01.2015
      and again from Agency Sales Administration to Agency Sales w.e.f.
      15.05.2017. It is claimed that on account of Departmental restructuring
      resulting in changes in duties and responsibilities of different officers,
      the Respondent No.1 became surplus and there being no alternative
      job available for his adjustment, his services were dispensed with,
      as per the terms of appointment.
9.    The Respondent No. 1 challenged his termination before the Regional
      Labour Commissioner (Central), which led to conciliation proceedings.
      However, no settlement could be arrived at. The Respondent No. 1 was
      issued a Certificate dated 25.10.2017 to approach the Tribunal directly.
10. The Respondent No.1 filed claim petition9 before the Tribunal. Three
    officers of the company were impleaded and not the company, which
    was the employer of the Respondent No.1. Para 3 of the Award of
    the Tribunal mentions that in spite of notice, neither the management
    company nor the officers who were impleaded as party appeared.
    Hence, they were proceeded against ex parte. However, the fact
    remains that the management was not a party before the Tribunal.
    Finally, while granting the relief also it was directed that the first
    party management-Bajaj Allianz Life Insurance Co. Ltd. is directed
    to reinstate the applicant workman whereas the first party impleaded



9    I.D. Case No.86 of 2017
986                                                          [2024] 9 S.C.R.

                              Digital Supreme Court Reports


       before the Tribunal was not Bajaj Allianz Life Insurance Co. Ltd. but
       Tarun Chugh, CEO and Managing Director of the company.
       10.1 It is to observe that proper impleadment of parties in any
            proceedings is sine qua non in any matter coming before the
            court. However, what is noticed is that it has become a casualty
            in the process. Due care is not taken at the time of initiation
            of any proceedings before any forum to ensure that proper
            parties are impleaded.
       10.2 The case in hand is not in isolation. It needs to be appreciated
            that a corporate has a separate legal entity as compared to an
            individual or an officer of the company. There can be privity of
            contract between the corporate and any other individual and
            that contract or communication may have been signed by any
            officer on its behalf as an authorized signatory. It does not mean
            that the officer signing the communication or the agreement or
            the executive head of the company becomes individually liable
            for any claim against the company except the cases where
            any specific claim is made in that regard. Any order or decree
            or award passed by the Court, in case proper parties are not
            impleaded, becomes inexecutable.
11. The plea taken before the High Court while challenging the aforesaid
    Award of the Tribunal was that the then Human Resource Manager
    and the Legal Manager were dealing with the matter and had
    engaged a counsel to represent the company before the Tribunal.
    However, the Legal Manager had left the management company
    on 26.09.2018 while the Human Resource Manager had left the
    management company on 24.05.2019, i.e., during the pendency
    of the matter before the Tribunal. The counsel10 engaged by the
    management company did not take proper care of matter,hence,was
    removed from the panel of the advocates conducting cases on behalf
    of the company. However, the High Court did not accept this plea
    and rejected the writ petition.
12. On the facts at hand and the material available on record, we find
    that there was a technical defect in the claim petition filed by the
    Respondent No.1 as the management who was his employer was


10   Name is being withheld
[2024] 9 S.C.R.                                                           987

      Tarun Chugh, CEO and Managing Director, Bajaj Allianz Life
            Insurance Company Ltd. v. Saroj Kumar Panda

     not even impleaded as party before the Tribunal, still a direction was
     issued to the management to reinstate him. The designation and
     job profile of the Respondent No.1 and even the material placed on
     record by the Respondent No. 1 were required to be considered by
     the Tribunal to come to the conclusion whether he was a workman
     or not. It is only then jurisdiction is vested in the Tribunal to deal with
     the subject. The reason assigned by the Appellant explaining the
     non-appearance of the counsel before the Tribunal seems plausible
     and acceptable. As the two officers, who were dealing with the matter
     and engaged the then counsel, had also left the organization.
13. Considering the totality of the facts, as discussed above, in our
    opinion, the appeal deserves to be allowed.
14. For the reasons mentioned above, we allow the present appeal.
    The impugned order passed by the High Court and the Award of the
    Tribunal are set aside. The matter is remitted back to the Tribunal
    for fresh consideration on merits after proper parties are impleaded,
    giving due opportunity to both the parties. There shall be no order
    as to costs.

     Result of the Case: Appeal Allowed.



     †
         Headnotes prepared by: Himanshu Rai, Hony. Associate Editor
                                 (Verified by: Kanu Agrawal, Adv.)