[CASE NUMBER] IN THE HIGH COURT OF GUJARAT AT AHMEDABAD LETTERS PATENT APPEAL NO. 1049 of 2012 In [CASE NUMBER] FOR APPROVAL AND SIGNATURE: HONOURABLE MR.JUSTICE [ENTITY] Sd/- and HONOURABLE MR.JUSTICE [ENTITY] Sd/- 1 Whether Reporters of Local Papers may be allowed to see the No judgment ? 2 To be referred to the Reporter or not ? No 3 Whether their Lordships wish to see the fair copy of the judgment No ? 4 Whether this case involves a substantial question of law as to the No interpretation of the [ACT] or any order made thereunder ? 5 Whether it is to be circulated to the civil judge ? No [ENTITY] Versus [ENTITY] Appearance: MR [ENTITY], ADVOCATE for the Appellant MR [ENTITY], ADVOCATE for the Respondent CORAM: HONOURABLE MR.JUSTICE [ENTITY] and HONOURABLE MR.JUSTICE [ENTITY] Date : 30/09/2014 CAV JUDGMENT
(PER : HONOURABLE MR.JUSTICE [ENTITY])
1. This appeal under Clause 15 of the Letters Patent is directed against the order dated 4.7.2012 passed by the learned Single Judge of this Court in the petition filed by the appellant under [SECTION] of the [ACT] seeking to hold that the action of the respondent in issuing penal order/ resolution dated 29.2.2012 is illegal, arbitrary, violative of the principles of natural justice and violative of [SECTION] and [SECTION] of the [ACT] and to direct the respondent to restore the petitioner to the position of Assistant City Engineer with all consequential benefits.
2. Learned Single Judge has dismissed the petition on the ground that it is the right of the employer for assessment of the petitioner's efficiency and efficacy during the period of probation for enabling the employer to retain him in the service in future and the petitioner could not be said to be penalized by the impugned order but it is just an order reverting the petitioner to his original position.
3. We have heard learned advocates for the parties.
4. Learned advocate Mr. [ENTITY] for the appellant submitted that the appellant-petitioner was issued a show cause notice containing various charges of his dereliction of duty and on such allegations, the petitioner was asked to explain as to why his probation should not be put an end to. Mr. [ENTITY] submitted that the petitioner gave detailed explanation to such show cause notice and thereafter, the impugned decision was taken vide resolution dated 29.2.2012 based on the conclusion of unsatisfactory performance of the petitioner. Mr. [ENTITY] submitted that such decision could be said to be stigmatic and therefore, before taking the impugned decision putting an end to the service of the appellant and reverting him to his original position, regular departmental inquiry was required to be initiated and since the same was not initiated, the impugned decision could be said in breach of the principle of natural justice. Mr. [ENTITY] submitted that after the appellant was selected, he was appointed on probation and such probation could not have been abruptly put an end to without following the principles of natural justice as it clearly appears that the appellant is reverted to his original position on various charges levelled against him in the show cause notice. He, therefore, urged to allow the appeal.
5. In support of his arguments, Mr. [ENTITY] relied on the following decision(s):-
[1] In the case of [PRECEDENT].
6. Learned advocate Mr. [ENTITY] appearing for the respondent submitted that in fact, the appointment of the appellant was purely on probation and his confirmation was subject to his completing the probation period satisfactorily. Mr. [ENTITY] submitted that the show cause notice was issued to the appellant to call for his explanation as regards his unsatisfactory work on different dates and for different works. Such explanation was called for to decide as to whether the appellant should be continued in service beyond the probation period. Mr. [ENTITY] submitted that it was always permissible to the respondent to judge the performance of the appellant during his probation period and when so judged, he was issued show cause notice for his unsatisfactory work so as to decide whether to end his probation or to continue him in service after the probation period. Mr. [ENTITY] submitted that on consideration of the explanation submitted by the appellant in response to the show cause notice, the respondent found that it was not desirable to extend his probation period further. On such assessment of the performance of the appellant during the probation period and having decided not to extend the probation period, the appellant was asked to go back to his original post of Technical Supervisor. Mr. [ENTITY] submitted that the appellant was not reverted from the promotional post as appointment of the appellant was directly on the post of Assistant City Engineer on probation. Since his probation period was not extended, he was sent back to his original post of Technical Supervisor and such being non- stigmatic order, no departmental inquiry was required to be held and therefore, it cannot be said that the respondent committed breach of the principles of natural justice in taking the impugned decision. He thus urged to dismiss the appeal.
7. In support of his arguments, Mr. [ENTITY] relied on the following decision(s):-
[1] In the case of [PRECEDENT];
[2] In the case of [PRECEDENT] Vs. L.A. Balakrishna reported in 2001 LLR 260.
8. Having heard learned advocates for the parties and having perused the papers of the case, what is not in dispute is that pursuant to the advertisement dated 28.8.2009 issued by the Municipal Commissioner of the respondent Corporation for filling the post of Assistant City Engineer with other posts, the appellant applied and he was selected for the said post and it was decided to appoint the appellant on probation for a period of one year under the resolution dated 24.5.2010. Following the resolution, the petitioner was issued the appointment order by the Assistant Manager. It is stated in the appointment order that the assessment of work of the petitioner during the probation period of one year shall be made at the end of the year. It appears that after the petitioner was issued show cause notice about his unsatisfactory work, since his explanation was under
consideration, his probation period was extended. It appears from the impugned decision dated 29.2.2012 that since the performance of the appellant was not found satisfactory, a decision was taken to put an end to his service after 29.2.2012, i.e. the date till which the probation period was extended. On account of such decision, naturally, the petitioner was to go back to his original post of Supervisor which he was holding when he was selected for the post of Assistant City Engineer pursuant to the advertisement as stated above. Therefore, it was never a reversion of the appellant from any promotional post.
9. Learned advocate Mr. [ENTITY], however, submitted that since the impugned decision was taken to put an end to the service of the petitioner on the basis of the allegations contained in the show cause notice, the same could be said to be stigmatic and could not be taken without complying the principles of natural justice and without following due departmental inquiry.
10. We have perused the show cause notice at Annexure-E. We find that by the show cause notice, it was stated to the appellant that his work was not found satisfactory on many occasions. In the show cause notice, it is clearly stated that the appellant should explain as to why his probation should not be put to an end to. After the explanation from the appellant, since the decision was taken to put an end to his service on the ground that his performance was not found satisfactory, the same cannot be said to be in any manner stigmatic. In fact, the decision is not taken on the basis of any proved misconduct nor even any allegation or charge which could be said to be a misconduct is at all referred in the impugned decision. Therefore, we find that the decision impugned in the petition since not stigmatic and is of simply discharging the appellant from the post of Assistant City Engineer and asking him to go back to his original post of Technical Supervisor, no departmental inquiry was required to be initiated nor any principles of natural justice were required to be followed.
11. In such view of the matter, we do not find that any interference is called for in the impugned order of the learned Single Judge.
12. In the case of [PRECEDENT] (supra), the Hon'ble Supreme Court found that the inquiry conducted against the judicial officer could not be said as innocent to judge his suitability. In the facts of the said case, Hon'ble Supreme Court found that there was a discreet inquiry made against the judicial officer who was on probation and following such discreet inquiry, termination was effected and therefore, the same was held to be stigmatic. This judgment of the Hon'ble Supreme Court will have no application to the facts of the present case.
13. In the case of [PRECEDENT] (supra), the Hon'ble Supreme Court has held and observed in para 10 and 12 as under:-
10. It is clear from the above that if the order of termination indicates that it is a termination simpliciter and does not cast any stigma on the employee by the said order of termination the mere fact that there was an inquiry into his conduct earlier would not by itself render the termination invalid. Applying the said principle, if we see that the order of termination in the present case is an order of discharge simpliciter. But in the course of the inquiry, the Labour Court noticed that on an earlier day, there was some incident where the administrative officer found some lacunae in the working of the respondent but based on that no charge-
sheet was served nor inquiry was conducted. However, the appellant came to the conclusion that it is not in its interest to continue respondent's services, hence, discharged him. In the background, the mere fact that there was a misconduct on the part of the respondent which was not enquired into ipso facto does not lead to the conclusion that the order of the termination is colourable and in fact is a punitive order.
12. This law laid down by a three-Judges Bench of this Court also shows that if an employer discharges the services of a probationer on the ground that his services are unsuitable, it does not cast any stigma on the employee nor it is punitive, in such cases even the principle of natural justices does not apply and there is no need for formal proceedings of inquiry before making such order.
14. In the case of [PRECEDENT] (supra), the Hon'ble Supreme Court has held and observed in para 5 and 6 as under:-
5. There can be no manner of doubt that the employer is entitled to engage the services of a person on probation.
During the period of probation, the suitability of the recruit/appointee has to be seen. If his services are not satisfactory which means that he is not suitable for the job, then the employer has a right to terminate the services as a reason thereof. If the termination during probationary period is without any reason, perhaps such an order would be sought to be challenged on the ground of being arbitrary. Therefore, normally services of an employee on probation would be terminated, when he is found not to be suitable for the job for which he was engaged, without assigning any reason. If the order on the face of it states that his services are being terminated because his performance is not satisfactory, the employer runs the risk of the allegation being made that the order itself casts a stigma. We do not say that such a contention will succeed. Normally, therefore, it is preferred that the order itself does not mention the reason why the services are being terminated.
6. If such an order is challenged, the employer will have to indicate the grounds on which the services of a probationer were terminated. Mere fact that in response to the challenge the employer states that the services were not satisfactory would not ipso facto mean that the services of the probationer were being terminated by way of punishment. The probationer is on test and if the services are found not to be satisfactory, the employer has, in terms of the letter of appointment, the right to terminate the services.
15. In the case of [PRECEDENT], the Hon'ble Supreme Court has held and observed in para 10 and 11 as under:-
10. Paras 1 to 3 of the show-cause notice reflect about the unsatisfactory performance of the duty of the appellant. Paras 4 and 5 of the show-cause notice were not taken into consideration in passing the order of termination of services as is evident from the termination order although reference is made to the show-
cause notice. The last para of the show-cause notice also indicates that the action was proposed in terms of Clause 2 of the order of appointment namely, terminating the services during probationary period. The order of termination of services refers to relevant clause in the order of appointment and explanation given by the appellant to the show-cause notice. The last paragraph of the said order shows that his explanation was found unsatisfactory. The appellant had wrongfully recommended acceptance of bad stock not once but several times; as such it was held that his services have been unsatisfactory. Hence, the order of termination was passed. From this order of termination, it is clear that the respondents did not rely on paras 4 and 5 of the show-cause notice. The Division Bench in the impugned judgment, after perusal of the files observed that the appointing authority had abandoned those charges and concentrated only on the lapses committed by the appellant in wrongfully recommending acceptance of bad stock. We have no good reason to differ with this finding recorded by the Division Bench after perusal of the relevant files and records. Even otherwise, paras 4 and 5 of the show-cause notice stand withdrawn as per the direction given by the High Court. This being the position, no prejudice is caused to the appellant to complain that High Court has exceeded its power to judicial review when such a deletion of paras 4 and 5 from the show cause notice is to the benefit and advantage of the appellant. This also protects the appellant from any adverse affect when he seeks employment elsewhere and prospective employer may not have any ground to take adverse view of the alleged misconduct contained in paras 4 and 5 of the show-cause notice.
11. An order of termination simpliciter passed during the period of probation has been generating undying debate. The recent two decisions of this Court in [PRECEDENT] v. Satyendra Nath Bose National Centre for Basic Sciences, Calcutta and others, 1999) 3 SCC 60) and [PRECEDENT] and another, 2002) 1 SCC 520), after survey of most of the earlier decisions touching the question observed as to when an order of termination can be treated as simpliciter and when it can be treated as punitive and when a stigma is said to be attached to an employee discharged during period of probation. The learned counsel on either side referred to and relied on these decisions either in support of their respective contentions or to distinguish them for the purpose of application of the principles stated therein to the facts of the present case. In the case of [PRECEDENT] (supra), after referring to various decisions indicated as to when a simple order of termination is to be treated as "founded" on the allegations of misconduct and when complaints could be only as motive for passing such a simple order of termination. In para 21 of the said judgment a distinction is explained, thus:-
"21. If findings were arrived at in an enquiry as to misconduct, behind the back of the officer or without a regular departmental enquiry, the simple order of termination is to be treated as "founded" on the allegations and will be bad. But if the enquiry was not held, no findings were arrived at and the employer was not inclined to conduct an enquiry but, at the same time, he did not want to continue the employee against whom there were complaints, it would only be a case of motive and the order would not be bad. Similar is the position if the employer did not want to enquire into the truth of the allegations because of delay in regular departmental proceedings or he was doubtful about securing adequate evidence. In such a circumstance, the allegations would be a motive and not the foundation and the simple order of termination would be valid."
From long line of decisions it appears to us whether an order of termination is simpliciter or punitive has ultimately to be decided having due regard to the facts and circumstances of each case. Many a times the distinction between the foundation and motive in relation to an order of termination either is thin or overlapping. It may be difficult either to categorize or classify strictly orders of termination simpliciter falling in one or the other category, based on misconduct as foundation for passing the order of termination simpliciter or on motive on the ground of unsuitability to continue in service. If the form and language of the so called order of termination simpliciter of a probationer clearly indicate that it is punitive in nature or/and it is stigmatic there may not be any need to go into the details of the background and surrounding circumstances in testing whether the order of termination is simpliciter or punitive. In cases where the services of a probationer are terminated by an order of termination simpliciter and the language and form of it do not show that either it is punitive or stigmatic on the face of it but in some cases there may be a background and attending circumstances to show that misconduct was the real basis and design to terminate the services of a probationer. In other words, the facade of the termination order may be simpliciter but the real face behind it is to get rid of services of a probationer on the basis of misconduct. In such cases it becomes necessary to travel beyond the order of termination simpliciter to find out what in reality is the background and what weighed with the employer to terminate the services of a probationer. In that process it also becomes necessary to find out whether efforts were made to find out the suitability of the person to continue in service or he is in reality removed from service on the foundation of his misconduct.
[SECTION]. In the case of [PRECEDENT], the Hon'ble Supreme Court has held and observed in para 19 and 20 as under:-
"19. It must be borne in mind that no employee whether a probationer or temporary will be discharged or reverted, arbitrarily, without any rhyme or reason. Where a superior officer, in order to satisfy himself whether the employee concerned should be continued in service or not make inquiries for this purpose, it would be wrong to hold that the inquiry which was held, was really intended for the purpose of imposing punishment. If in every case where some kind of fact- finding inquiry is made, wherein the employee is either given an opportunity to explain or the inquiry is held behind his back, it is held that the order of discharge or termination from service is punitive in nature, even a bona fide attempt by the superior officer to decide whether the employee concerned should be retained in service or not would run the risk of being dubbed as an order of punishment. The decision to discharge a probationer during the period of probation or the order to terminate the service of a temporary employee is taken by the appointing authority or administrative heads of various departments, who are not judicially trained people. The superior authorities of the departments have to take work from an employee and they are the best people to judge whether an employee should be continued in service and made a permanent employee or not having regard to his performance, conduct and overall suitability for the job. As mentioned earlier a probationer is on test and a temporary employee has no right to the post. If mere holding of an inquiry to ascertain the relevant facts for arriving at a decision on objective considerations whether to continue the employee in service or to make him permanent is treated as an inquiry "for the purpose of imposing punishment" and an order of discharge or termination of service as a result thereof "punitive in character", the fundamental difference between a probationer or a temporary employee and a permanent employee would be completely obliterated, which would be wholly wrong.
20. In the present case neither any formal departmental inquiry nor any preliminary fact-finding inquiry had been held and a simple order of discharge had been passed. The High Court has built an edifice on the basis of a statement made in the written statement that the respondent was habitual absentee during his short period of service and has concluded therefrom that it was his absence from duty that weighed in the mind of Senior Superintendent of Police as absence from duty is a misconduct. The High Court has further gone on to hold that there is direct nexus between the order of discharge of the respondent from service and his absence from duty and, therefore, the order discharging him from service will be viewed as punitive in nature calling for a regular inquiry under [SECTION] of the Rules.We are of the opinion that the High Court has gone completely wrong in drawing the inference that the order of discharge dated [SECTION]-3-1990 was, in fact, based upon the misconduct and was, therefore, punitive in nature, which should have been preceded by a regular departmental inquiry.There cannot be any doubt that the respondent was on probation having been appointed about eight months back. As observed in [PRECEDENT] (supra) the period of probation gives time and opportunity to the employer to watch the work ability, efficiency, sincerity and competence of the servant and if he is found not suitable for the post, the master reserves a right to dispense with his service without anything more during or at the end of the prescribed period, which is styled as period of probation. The mere holding of preliminary inquiry where explanation is called from an employee would not make an otherwise innocuous order of discharge or termination of service punitive in nature.Therefore, the High Court was clearly in error in holding that the respondent's absence from duty was the foundation of the order, which necessitated an inquiry as envisaged under [SECTION] of the Rules."
17. In the case of [PRECEDENT], the Hon'ble Supreme Court has held and observed in para 23 as under:-
23. This position is no longer res integra and it is well-settled that even if an order of termination refers to unsatisfactory service of the person concerned, the same cannot be said to be stigmatic. In [PRECEDENT], this Court has explained at length the tests that would apply to determine if an order terminating the services of a probationer is stigmatic. On the facts of that case it was held that the opinion expressed in the termination order that the probationer's "work and conduct has not been found satisfactory"
was not ex facie stigmatic and in such circumstances the question of having to comply with the principles of natural justice do not arise.
18. In the case of [PRECEDENT], the Hon'ble Supreme Court has held and observed in para 25 and 36 as under:-
"25. The ratio of the above noted judgments is that a probationer has no right to hold the post and his service can be terminated at any time during or at the end of the period of probation on account of general unsuitability for the post held by him. If the competent authority holds an inquiry for judging the suitability of the probationer or for his further continuance in service or for confirmation and such inquiry is the basis for taking decision to terminate his service, then the action of the competent authority cannot be castigated as punitive. However, if the allegation of misconduct constitutes the foundation of the action taken, the ultimate decision taken by the competent authority can be nullified on the ground of violation of the rules of natural justice.
36. There is a marked distinction between the concepts of satisfactory completion of probation and successful passing of the training/test held during or at the end of the period of probation, which are sine qua non for confirmation of a probationer and the Bank's right to punish a probationer for any defined misconduct, misbehaviour or misdemeanor. In a given case, the competent authority may, while deciding the issue of suitability of probationer to be confirmed, ignore the act(s) of misconduct and terminate his service without casting any aspersion or stigma which may adversely affect his future prospects but, if the misconduct/misdemeanor constitutes the basis of the final decision taken by the competent authority to dispense with the service of the probationer albeit by a non stigmatic order, the Court can lift the veil and declare that in the garb of termination simpliciter, the employer has punished the employee for an act of misconduct."
19. In light of the above settled principles of law and for the reasons stated above, the appeal is dismissed with no order as to costs.
([ENTITY], J.) Sd/-
[ENTITY], J.) omkar