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of <h1>Court dismisses claim for compensation in employment termination case due to lack of standing under Companies Act.</h1> The court dismissed the petitioner's claim for compensation due to premature termination of employment, stating the petitioner lacked standing to present ... Compensation for loss of office Issues:1. Validity of the petitioner's claim for compensation due to premature termination of employment.2. Jurisdiction of the court to determine the quantum of compensation under section 318 of the Companies Act.3. Payment of arrears of salary to the petitioner.Analysis:The petitioner, an ex-employee of the respondent-company, sought compensation of Rs. 4,02,828.90 for premature termination of his employment. His appointment as a technical director was approved by the Company Law Board and extended for five years. However, the petitioner resigned, claiming the amount due. The court noted that the petitioner failed to establish his locus standi under section 433 of the Companies Act to present a winding-up petition. The court emphasized that claims for compensation for loss of office should be determined by a civil court, not the company court, unless a decree is obtained.Regarding the jurisdiction to determine compensation under section 318 of the Companies Act, the court clarified that the provision merely authorizes the company to compensate for loss of office without conferring jurisdiction on the court to decide the quantum of compensation. The court rejected the argument that section 318 empowered the court to determine the compensation amount, stating it is a declaratory provision for the company to compensate employees as mentioned.The respondent contended that arrears of salary due to the petitioner had been paid after the petition was filed, a fact not disputed by the petitioner's counsel. As a result, the court found the company petition to be not maintainable and dismissed it. The court also ruled that the application to summon documents was no longer relevant, and the order was passed accordingly.
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