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CASE NO.: Appeal (civil)  21 of 2003

PETITIONER: Municipal Committee, Sirsa                

RESPONDENT: Munshi Ram                                               

DATE OF JUDGMENT: 04/02/2005

BENCH: N.Santosh Hegde & S.B. Sinha

JUDGMENT: J U D G M E N T

SANTOSH HEGDE,J.

       The appellant is a municipal committee which had  appointed the respondent on probation for a period of one year  as ’Octroi Moharrir’.  The letter of appointment dated  21.07.1979 inter alia stated that services of respondent can be  terminated without assigning any cause at any time during the  period of probation.  By a letter dated 12.03.1980, the service of  the respondent was terminated during the period of probation.   The said letter of termination read thus;         "Shri Munshi Ram, Octroi Moharrir Municipal  Committee, Sirsa is hereby discharged from the duty as  no longer is required by Municipal Committee, Sirsa with  immediate effect.                                                                 Sd/-                                                     Administrator                                         Municipal Committee,  Sirsa"

       The said termination/discharge gave rise to a labour  dispute raising the following issue;         "Whether the termination of services of Shri MunshiRam  was justified and in order?  If not, to what relief he is entitled?"

       The Labour Court by its order dated 19.06.1982 made an  award holding that the termination was neither justified nor in  order and the workman is entitled to reinstatement with  continuity of services and with full back wages.         The said award came to be challenged in the Writ  Petition before a learned Single Judge of the High Court of  Punjab & Haryana at Chandigarh.  The learned Single Judge by  his order dated 30.08.1991 allowed the writ petition and set  aside the award of the Labour Court.  While doing so, it  observed;         "He was on probation for a period of one year and  it was during the period of probation that his services  were terminated.  The order of termination did not assign  any reson\005  a person on probation is virtually on trial.   The employer is not bound to suffer an incompetent  employee for the full term of probation."

       This order of learned Single Judge came to be challenged  by the respondent in Writ Appeal before the same Court.  The  Appellate bench of the said High Court observed that during the  course of the inquiry before the Labour Court, a witness had  admitted that on 11.03.1980 when the Administrtor inspected

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the octroi post he had found that the respondent had allowed  certain vehicles carrying goods to go without charging of octroi  fees  and contrary to the rules he was found in possession of  excess money to the extent of Rs.15.80. From the record it was  found that immediately after the said instance in question the  services of the respondent came to be terminated.  Therefore,  concurring with the findings of the Labour Court, the Appellate  bench held that the order of discharge, though termed as  discharge simplicitor, was in reality a colourable exercise of  termination without holding an inquiry and it agreed with the  Labour Court and restored its award.         Against the said order of the Appellate bench of the High  Court, the appellant is now before us in this appeal.         The question for our consideration is on the facts and  circumstances of this case was the termination of the  respondent was punitive or is a discharge simplicitor?  On  reading of the order of discharge it is clear that it is a discharge  simplicitor, but the evidence as came on record shows that there  was some act of negligence on the part of the respondent which  was noticed by the officer of the appellant, hence, the Labour  Court as well as the Appellate bench came to the conclusion  that it was a termination in the guise of discharge. In the above factual back drop, we would like to examine  whether the Labour Court was justified in setting aside the  order of discharge made by the appellant.         Law on this question by now is well settled.  This Court  in the case of Krishnadevaraya Education Trust & Anr. vs.  L.A. Balakrishna {(2001) 9 SCC 319} while considering the  similar situation held thus;         "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, naturally 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 ht 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.

       If such n 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."

       It is clear from the above that if the order of termination  indicates that it is a termination simplicitor 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

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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 simplicitor.  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.          In H.F. Sangati vs. Registrar General, High Court of  Karnataka & Ors. {(2001) 3 SCC 117}, this Court while  considering the discharge of a probationary Munsif held;         "The impugned order does not cast any stigma on  the appellants.  All that has been said in the impugned  order is that the appellants were unsuitable to hold the  post of Munsif.  The impugned order of discharge has  been passed in strict compliance with the requirements of  rule 6. It does not cast any stigma on the appellants nor is  it punitive.  There was, thus, no requirement to comply  with the principles of natural justice, much less to hold  any formal proceedings of inquiry before making the  order."

       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.         In Pavanendra Narayan Verma vs. Sanjay Gandhi PGI  of Medical Sciences & Anr. {(2002) 1 SCC 520} this Court  again considering a similar case held;         "One of the judicially evolved tests to determine  whether in substance an order of termination is punitive  is to see whether prior to the termination there was (a) a  full-scale formal enquiry (b) into allegations involving  moral turpitude or misconduct which (c) culminated in a  finding of guilt.  If all three factors are present the  termination has been held to be punitive irrespective of  the form of the termination order.  Conversely if any one  of the three factors is missing, the termination has been  upheld."

       From the above, it is seen that in the absence of the three  facts as mentioned therein, namely,  (a) a full-scale formal enquiry;  (b) into allegations involving moral turpitude or misconduct  which;  (c) culminated in a finding of guilt the termination cannot be held to be bad.         This Court in the said case of Pavanendra Narayan  Verma vs. Sanjay Gandhi PGI of Medical Sciences & Anr.  {(2002) 1 SCC 520} further held:                 "It cannot be held that the enquiry held prior to the  order of termination turned the otherwise innocuous  order into one of the punishment.  An employer is  entitled to satisfy itself as to the competence of a  probationer to be confirmed in service and for this  purpose satisfy itself fairly as to the truth of any

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allegation that may have been made about the employee.   A charge-sheet merely details the allegations so that the  employee may deal with them effectively.  The enquiry  report in this case found nothing more against the  appellant than an inability to meet the requirements for  the post.  None of the three factors catalogued above for  holding that the termination was in substance punitive  exists in the present case.

               An affidavit cannot be relied on to improve or  supplement an order.  Equally, an order which is  otherwise valid cannot be invalidated by reason of any  statement in any affidavit seeking to justify the order."

       From the above, it is clear assuming that there was some  sort of misconduct, as noticed in the evidence of the witnesses  of the management in the cross-examination, the same could  not be used as evidence by the Labour court or by the Appellate  court for coming to the conclusion that an order of termination  which is otherwise simplicitor in nature is motivated by any  consideration other than the decision of the management as to  the satisfactory nature of the workman concerned.         As noticed above in the instant case, the respondent  having been appointed as a probationer and his working having  been found not to the satisfaction of the employer, it was open  to the management to terminate his services.  Assuming that  there was an incident of misconduct or incompetency prior to  his discharge from service, the same cannot be ipso facto be  termed as misconduct requiring an inquiry.  It may be a ground  for the employer’s assessment of the workman’s efficiency and  efficacy to retain him in service, unless, of course, the workman  is able to satisfy that the management for reasons other than  efficiency wanted to remove him from services by exercising its  power of discharge         On the facts of this case, we are satisfied that the incident  referred to in the evidence of the management’s witness does  not give rise to a conclusion that the discharge of the  respondent was a colourable exercise, with a collateral intention  of avoiding an inquiry. Nor does the order of discharge carry  any stigma. Hence, the Labour Court as well as the Appellate  bench of the High Court have erred in coming to a contra  conclusion. This appeal succeeds.  The same is allowed.  The  impugned order of the Appellate bench of the High Court as  well as award of the trial court is set aside upholding the order  of discharge made by the appellant in regard to the respondent  herein.