Court directs Tamil Nadu State Marketing Corporation to adopt fair transfer counseling and enhance shop administration amid allegations of mala fide transfers
In a significant judgment dated October 13, 2026, the Madurai Bench of the Madras High Court addressed the issue of alleged mala fide transfers of employees working under the Tamil Nadu State Marketing Corporation Limited (TASMAC). The case involved multiple writ petitions filed by TASMAC employees, including Salesmen and Supervisors, challenging their transfer orders on the ground that the transfers were retaliatory, following complaints lodged against a private respondent.
The petitioners contended that one among them, Kodeeswaran, had filed a complaint against Govindaraj, a private respondent, and subsequently, all petitioners were transferred to various places at the instance of Govindaraj, which they claimed was a mala fide action. The Court, upon examining the pleadings and documents-including a complaint bearing the seal of the third respondent-granted an interim stay on the transfer orders, allowing the petitioners to continue in their original shops pending further inquiry.
Following the Court's direction to inquire into the authenticity and circumstances of the complaint, the first respondent submitted a report indicating the proposal to implement a transparent transfer counseling policy. Appreciating this initiative, the Court emphasized that transfers should not be executed merely on the basis of allegations or complaints. Instead, employees should be considered fairly through an open and transparent counseling process, ensuring no prejudice or arbitrariness in administrative decisions.
Further, to improve the overall administration and oversight of TASMAC shops, the Court issued directions for the installation of CCTV cameras in all shops. It mandated that these cameras be monitored regularly from the Regional Offices to ensure proper governance and to prevent any misuse of power or harassment of employees.
The Court disposed of the writ petitions with liberty to the respondents to take decisions on transfers during the proposed counseling sessions. It reiterated the importance of fairness in service matters and the need for transparent administrative procedures in a public sector undertaking such as TASMAC.
This judgment is expected to set a precedent for the treatment of transfer matters within TASMAC and potentially other government undertakings, promoting employee rights and administrative transparency.
Bottom Line:
Transfer of TASMAC employees challenged on allegation of mala fide transfer at the instance of a private respondent - Court appreciated proposed transparent transfer counselling policy and held that employees should be considered during transfer counselling instead of being transferred merely on the basis of allegations - Directions also issued for installation and monitoring of CCTV cameras in TASMAC shops for proper administration.
Statutory provision(s):
Article 226, Constitution of India, 1950
