C.W.P. No.7777 of 1988 -1- IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH **** C.W.P. No.7777 of 1988 Date of Decision:17.09.2008 The Ambala Central Co-operative Bank Ltd., Ambala City .....Petitioner Vs. The Presiding Officer, Labour Court, Ambala and another .....Respondents CORAM:- HON'BLE MR. JUSTICE HARBANS LAL Present:- Ms. Maninder, Advocate for Mr. R.K. Chopra, Sr. Advocate for the petitioner. Mr. Gobinder Singh Sandhu, Advocate and Mr. S.S. Dalal, Advocate for respondent No.2. **** HARBANS LAL, J. This petition has been moved by the Amabla Central Co- operative Bank Limited, Ambala City under Articles 226/227 of the Constitution of India for quashing the award dated 2.6.1988 (Annexure P.4) vide which the termination of services of the respondent- Banta Ram (hereinafter to be referred as `the workman') has been declared illegal. The brief facts giving rise to this petition are that the workman was appointed as a Manager of Cooperative Society. Later on, he was redesignated as Secretary on probation for a period of two years in the pay- scale of Rs.110-225/-. The appointment letter was issued on 9.9.1976. He joined on 18.9.1976. During his probation period, his work and conduct was not found to be satisfactory. On 6.3.1979, the Managing Director of the petitioner- Bank issued an order extending the period of probation of the workman, whose services were governed by the rules called the Haryana State Central Co-operative Banks Staff Service (Common Cadre) Rules, C.W.P. No.7777 of 1988 -2- 1975 (for short, `the Common Cadre Rules”). As provided in Rule 5(iv) of the Common Cadre Rules, every person appointed to any post in the service by promotion or direct recruitment shall remain on probation for a period of two years from the date of appointment unless it is extended for a further period not exceeding one year and during his probation period, an employee directly recruited shall be liable to be discharged from service without giving any notice and opportunity. An employee promoted from a lower post to higher post shall be liable to be reverted to the lower post, if his work and conduct is found unsatisfactory. The workman was appointed on probation for two years. While working as Secretary in Ratauli Cooperative Society, he made advances frequently to Shamsher Singh and Inderjit Singh on 20.2.1978, 8.3.1978, 15.5.1978, 30.6.1978 and 24.7.1978 amounting to Rs.13,700/- without any specific purpose and without obtaining permission of the Members of the Managing Committee of the Society. He misutilised the funds of the Society. Similarly, the closing balance of the cash book on 20.2.l978 was Rs.6,556.76. However, while carrying over the opening balance on 1.3.1978, he showed as Rs.5,556.76. In this way, he embezzled Rs.1,000/-. A proper inquiry was ordered. He intentionally did not participate in the same. The Inquiry Officer submitted its report reaching to the conclusion that he has misappropriated and embezzled the money. The petitioner instead of proceeding with the inquiry report decided to discharge the workman from the bank service. His appeal was rejected on 4.10.1979. Thereafter, he raised an industrial dispute which was referred for adjudication to the Labour Court, Ambala. Vide award dated 2.6.1988 (Annexure P.4), the termination of services of the respondent- workman has been declared illegal. Feeling aggrieved therewith, the petitioner has C.W.P. No.7777 of 1988 -3- filed this petition. In his written statement, the workman has inter-alia pleaded that the petitioner- Bank after having filed writ petition in this Court has decided vide resolution dated 17.5.1996 passed by the Board of Directors to permit him to join his duty as a Secretary. He is continuously working as a Secretary in various Societies since the decision of the petitioner- Bank dated 17.5.1996. It has been alleged that the answering respondent has neither made any embezzlement in any society nor any inquiry was ever held. Lastly, it has been prayed that this petition may be dismissed with costs. I have heard the learned counsel for the parties, besides perusing the findings returned by the learned Presiding Officer of the Labour Court with due care and circumspection. Ms. Maninder, Advocate appearing on behalf of the petitioner urged with a good deal of force that the workman was appointed on probation for a period of two years which was further extended upto September, 1979. As per Common Cadre Rules, his services could be terminated during the period of probation without any notice and without affording an opportunity of being heard. That being so, the learned Presiding Officer, Labour Court has gravely erred in holding that the inquiry was a statutory requirement and it had not been proved to have been held. To controvert these submissions, Mr. Gobinder Singh Sandhu, Advocate appearing on behalf of the workman pressed into service that the services of the workman could not be terminated without holding an inquiry. He further canvassed at the bar that as emanates from the petition, C.W.P. No.7777 of 1988 -4- the inquiry was held, but such inquiry report as well as the inquiry proceedings were not produced before the Labour Court. He further urged with great eloquence that as follows from the petition, the workman had allegedly embezzled some amount but without holding any inquiry, his services were terminated. Had he verily defalcated the alleged amount, by all probabilities, the inquiry would have been held. He further puts that the workman has been condemned unheard and that being so, no fault can be found with the observations of the Labour Court. To buttress these stances, he has sought to place abundant reliance upon the observations made in re: V.P. Ahuja v. State of Punjab and others, 2000(2) Recent Services Judgments 127; Dipti Prakash Banerjee v. Satvendra Nath Bose National Centre for Basic Sciences, Calcutta and others , AIR 1999 Supreme Court 983; Samsher Singh (Ex- Constable) v. State of Haryana and others , 1996(1) Services Law Reporter 298, The Haryana State Cooperative Apex Bank Limited v. Sat Narain , 1996(1) Services Law Reporter 559. I have given a deep and thoughtful consideration to the rival contentions. It is own case of the petitioner in the petition that the workman was covered by the Common Cadre Rules. As per the averments in the petition, the workman had made advances frequently to Shamsher Singh and Inderjit Singh and ultimately, it was found that he had embezzled a sum of Rs.1,000/-. His work and conduct was not found to be satisfactory. If he was governed by the afore-mentioned rules, his services could have not been terminated without holding inquiry. It is own plea of the petitioner that the inquiry was held and it was found that the workman has committed embezzlement/ misappropriation of the funds and serious irregularities. If it C.W.P. No.7777 of 1988 -5- was so, what was the hitch for the petitioner to produce the inquiry proceedings including the inquiry report before the Labour Court. The petitioner has come up with the plea that instead of proceeding with the inquiry report, it decided to discharge the respondent from the Bank service, as he was working on probation. Vide Annexure P.2, the probation period of the workman was extended for further six months. Annexure P.1 is his appointment letter purporting to have been issued on 9.9.1976. As transpires from Annexure P.3, he was discharged from the bank service on 30.3.1979. It is indicative of the fact that he had put in more than two years' service. In re: Jarnail Singh and others v. State of Punjab and others, 1986 (2) Services Law Reporter 278, the Apex Court ruled as under:- “The position is now well-settled on a conspectus of the decisions referred to hereinbefore that the mere form of the order is not sufficient to hold that the order of termination was innocuous and the order of termination of the services of a probationer or of an ad hoc appointee is a termination simpliciter in accordance with the terms of the appointment without attaching any stigma to the employee concerned. It is the substance of the order i.e. the attending circumstances as well as the basis of the order that have to be taken into consideration. In other words, when an allegation is made by the employee assailing the order of termination as one based on misconduct, though couched in innocuous terms, it is incumbent on the Court to lift the veil and to see the real circumstances as well as the basis and foundation of the order complained of. In other words, the Court, in such case, will lift C.W.P. No.7777 of 1988 -6- the veil and will see whether the order was made on the ground of misconduct, inefficiency or not.” (Emphasis supplied). In view of the above observations, it is to be seen as to what in fact were the basis for terminating the services of the workman. As noted supra, it is own plea of the petitioner that the workman had committed embezzlements, misappropriations of funds and his work was found unsatisfactory. These circumstances in fact became the basis of the termination order. On lifting the veil, it comes to the fore that the alleged embezzlements were the basis and foundation of the discharge order. Thus, this order is not a discharge simpliciter rather it attaches stigma and is punitive in nature for the reason that the workman was discharged from service owing to his alleged acts of embezzlement. In re: V.P. Ahuja (supra), the order of termination on the face of it was found to be stigmatic. The Apex Court held that order of termination could not have been passed without holding a regular inquiry and giving an opportunity of hearing to the appellant. The order by which the services of the appellant were terminated was quashed with a direction to put back the appellant in service with all consequential benefits as has been done by the Labour Court in the present case. In re: Samsher Singh (supra), the police officer was discharged from service on the ground that he was found unlikely to prove an efficient police officer within his probation period. It was held that the order casts a stigma. The order of discharge was held illegal in the case under reference. In re: Sat Narain's case (supra), the services of the employee were terminated during the period of probation on the ground that he was not found suitable. Before passing an order of termination of his services, he was called upon to submit his explanation about his work and C.W.P. No.7777 of 1988 -7- conduct. He submitted the same. It was held that the order could have been passed only after following principles of natural justice and service regulations by holding an inquiry. The order of termination is thus violative of principles of natural justice and bad in law. The Court can lift the veil to come to just conclusion and to know the background of the order of termination. Order of discharge even of a probationer based on misconduct will not be an order of discharge simpliciter and would be punitive in nature, which cannot be passed without affording an opportunity of being heard. Reverting back to the facts of the present case, as noted supra, on lifting the veil of the discharge order dated 30.3.1979 (Annexure P.3), there can be no escape from the finding that the background of discharge order of the workman from the service was the misappropriation of money which too smacks of punitiveness. The same could have not been passed without affording an opportunity of being heard to the workman. In view of the above discussion, no fault can be found with the impugned award. There is no denying the fact that the workman has been permitted to join his duty as a Secretary and he is continuously working as such. The petitioner has not filed replication controverting the pleas taken up by the workman in his written statement. In view of the preceding discussion, I do not consider it proper to interfere with the impugned award in exercise of the writ jurisdiction under Articles 226/227 of the Constitution of India. Consequently, this petition is dismissed. September 17, 2008 ( HARBANS LAL ) renu JUDGE C.W.P. No.7777 of 1988 -8- Whether to be referred to the Reporter? Yes/No