1986 INSC 0231
                                     Smt. Kusum Gupta alias Kusum Bansal
                                                           Vs

                       Haryana State Small Industries & Export Corpn., Chandigarh
                                          Civil Appeal No. 2569 of 1986

                                      (O. Chinnappa Reddy, M. M. Dutt JJ)
                                                      31.07.1986
                                                        ORDER

CHINNAPPA REDDY, J. ­
1. Special leave granted.
2. The services of Smt. Kusum Gupta, who was originally appointed as a clerk in the respondent-
Corporation on July 25, 1974, were terminated on August 7, 1980 by an Office Order running as
follows :

                  Office Order
                  The services of Mrs. Kusum Gupta working as Sales Assistant in Haryana
                  Emporium, New Delhi are no longer required by the Corporation with immediate
                  effect. She will be paid one month's pay plus allowances in lieu of notice period.
                  #
                  Sd/-
                  P. R. Kaushik
                  Managing Director
                  Endst. No. HIEC/Estt./6165
                  Dated August 7, 1980.##
                  Copy forwarded for information and necessary action to :
                  #
                  1. General Manager, Marketing They are required to issue
                  2. Company Secretary } no dues certificate in favour of Mrs. Kusum Gupta,
                  3. Controller of Accounts
                  4. General Manager, New Delhi Emporium } Sales Asstt. immediate.
                  5. Mrs. Kusum Gupta, Sales Assistant, New Delhi Emporium, New Delhi. General
                  Manager for Manager Director##

It is admitted that the "one month's pay plus allowances in lieu of notice period" was never paid to
the appellant. She filed a suit questioning the order terminating her services on the principal ground
that she had not been paid "one month's pay plus allowances in lieu of the notice period"
simultaneously with the order terminating her services. The suit was decreed by the trial court, but
on appeal, the Additional District Judge reversed the judgment and decree of the trial court. The
appellant filed a second appeal to the High Court. The High Court while holding that one month's
pay and allowances had to be paid along with the order terminating the appellant's services,
nevertheless confirmed the decree of the appellate court on the ground that the plaintiff had failed to
obtain the no dues certificate even by the time she appeared in the trial court. We are of the view
that the judgment of the High Court is wholly unsustainable.

3. Bye-law No. 3.2(ii) which governs the situation is as follows :

                  3.2 Termination of Service. - The services of an employee of the Corporation may be
                  terminated by the Appointing Authority -

                  (ii) In the case of temporary employees by giving one month's notice on either side
                  or, in lieu thereof pay for the period the notice falls short of one month.

The bye-law is clear that the services of an employee could only be terminated by giving one
month's notice or, in lieu of notice, by paying the salary, etc. for the period of one month. It would
not be open to the employer to insist upon the production of no dues certificate' by the employee. In
fact, we fail to see how the employer can insist upon the production of a 'no dues certificate' by the
employee when the certificate has to be given by the employer. The employer is the person who is
in the know of things whether any amount is due from the employee or not. The employer cannot
certainly take advantage of his failure to give a certificate to the employee and claim that he was
entitled to withhold the one month's pay and allowances payable in lieu of the one month's notice on
the ground of non-production of no dues certificate by the employee. We have no hesitation in
allowing this appeal. The judgment and decree of the High Court are set aside. The judgment and
decree of the trial court are restored with costs throughout.

</html