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PETITIONER: MUNICIPAL CORPORATION, RAIPUR

       Vs.

RESPONDENT: ASHOK KUMAR MISRA

DATE OF JUDGMENT16/04/1991

BENCH: RAMASWAMY, K. BENCH: RAMASWAMY, K. KASLIWAL, N.M. (J)

CITATION:  1991 AIR 1402            1991 SCR  (2) 320  1991 SCC  (3) 325        JT 1991 (2)   599  1991 SCALE  (1)753

ACT:      Madhya Pradesh Government Servants’ Central  Conditions of  Service  Rules, 1961: Rule 8 - Probationer -  Expiry  of prescribed  period of probation - Termination of  service  - Whether  Valid   -  Whether  entitled  to  right  to  deemed confirmation - Madhya Pradesh Civil Services Classification. Control  and  Appeal  Rules, 1966:  Rule  9A  and  Municipal Officers’ and Servants’ Recruitment Rules: Rule 14-  Whether applicable.

HEADNOTE:      The   respondent   was  appointed  in   the   appellant Corporation and put on probation for a period of two  years. About  three  month’s  after the completion  of  two  years’ period he was served with one month’s notice for termination of  his  service.  Challenging  the  termination  order  the respondent filed a suit for declaration that the termination without enquiry and opportunity of being heard was violative of   Rule   9A  of  the  Madhya   Pradesh   Civil   Services Classification,  Control and Appeal Rules 1966 and  that  he became   a  permanent  employee  of  the  Corporation   with continuity of service and arrears of salary. The trail court dismissed  the suit, and appeal, it was confirmed. The  High Court allowed the respondent’s second appeal and decreed the suit.      In the appeal, by special leave, before this Court,  on behalf  of the appellant-Corporation it was  contended  that the respondent being a probationer, would acquire  permanent status  only  on  confirmation,  that  the  High  Court  had committed  manifest  error  in law in holding  that  on  the expiry  of  two years’ period of probation,  the  respondent must  be deemed to have been confirmed under Rule 14 of  the Municipal  Officers’ and Servants’ Recruitment Rules,  which were  no  longer  in force, and that Rule 8  of  the  Madhya Pradesh  Government Servants’ General Conditions of  Service expressly   proved confirmation of probation as a  condition precedent and since notice terminating respondent’s  service was  issued, in terms of the rules, before confirmation,  it was valid in law.      On  behalf of the respondent, it was contended that  by operation   of  the  resolution  passed  by  the   Municipal

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Corporation under Section 25 of                                                      321 the Central Provinces and Bearer Municipality Act, 1922, the Municipal Officers and Servants was governed by  recruitment rules  thereunder,  that since no action was  taken  by  the appellant  Corporation  to dispense  with  the  respondent’s service,  on  the  expiry of the period  of  two  years,  as envisaged  in  Rule  14  of  the   Municipal  Officers’  and Servants’  Recruitment Rules, the respondent must be  deemed to have been confirmed, and consequently, the only power the Corporation had was to terminate the respondent’s service in accordance  with  the  classification,  Control  and  Appeal Rules, after conducting an enquiry and giving him reasonable opportunity,  that  too for misconduct, but  since  no  such procedure  was adopted, the notice was illegal and the  High Court was justified in granting the decree.      Allowing the appeal, this Court,      HELD:  1.1 Under the Note to sub-rule (2) of Rule 8  of the  Madhya Pradesh Govt. Servant’s, General  Conditions  of Service Rules, 1961 if the probationer is neither  confirmed nor  discharged  from service at the end of  the  period  of probation,  he  should be deemed to have been  continued  in service  as  probationer  subject to the  condition  of  his service  being terminated on the expiry of a notice  of  one calendar month, given in writing by either side. As per sub- rule (6) on passing the prescribed departmental  examination and on successful completion of the period of probation, the probationer  should be confirmed in the service or  post  to which  he  has been appointed. Then he becomes  an  approved probationer.  Therefore, after the expiry of the  period  of probation and before its confirmation, he would be deemed to have been continued in service as probationer. [375F-H]      1.2  Confirmation  of  probation would  be  subject  to satisfactory  completion  of the probation and pass  in  the prescribed examinations. Expiry of the period of  probation, therefore,  does  not  entitle him with a  right  to  deemed confirmation. The rule contemplates to pass an express order of confirmation in that regard. By issue of  notice  of  one calendar  month in writing by either side, the tenure  could be put to an end. [326A-B]      1.3  If  the  rules  do  not  empower  the   appointing authority  to  extend  the period of  probation  beyond  the prescribed  period,  or  where the rules  are  absent  about confirmation   or  passing  of  the  prescribed   test   for confirmation of probation, inaction for a very long time may lead  to  an indication of the  satisfactory  completion  of probation. [327D-E]                                                      322      1.4  Rule 8 expressly postulates otherwise. Hence  mere expiry  of the initial period of probation which is  subject to  extension  for  another  period of  one  year  does  not automatically  have the effect of deemed  confirmation,  and the  status of a deemed confirmation of the  probation.   An express   order  in  that  regard  on  fulfillment  of   the conditions stipulated in the Rule only confers the status of approved probation.[327E-F]      State  of  Punjab v. Dharam Singh [1968] 3  SCR  1;  Om Prakash  Maurya v. U.P. Co-op. Sugar  Factories  Federation, Lucknow & Ors. [1986] Suppl.SCC 95; M.A. Agarwal v.  Gurgaon Bank  & Ors.,[1987] Suppl. SCC 643 and State of  Gujarat  v. Akhilesh   C.   Bhargav   &  Ors.,  [1987]   3   SCR   1091, distinguished.      1.5  Note  to sub- rule (2) read with sub-rule  (6)  of Rule 8 manifest she legislative intent that confirmation  of the  probation  of  the respondent would  be  made  only  on

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successful  completion of the probation and the  passing  of the   prescribed   examinations.   The   respondent   shall, therefore,  be deemed to be continued an  probation.  Before confirmation  the  appointing  authority  is  empowered   to terminate  the  service of the probationer  by  issuing  one calendar month’s notice in writing and on expiry thereof the service stands terminated without any further notice. Within three  months from the date of expiry of original two  years period  of probation and within th extendable period of  one year the order of termination was made. Hence, the  question of  conducting an inquiry under the Classification,  Control and  Appeal Rules after giving an opportunity and  that  too for specific charges does not arise. [327G-H, 328A]      In the circumstances the High Court, committed manifest error of law in decreeing the suit. [328B]      2. By virtue of the resolution passed by the  Municipal Council,  which subsequently became  Municipal  Corporation, making  a  draft bye-law , exercising  power  under  section 173(2)  of  the  Madhya  Pradesh  Municipal  Act,  1922  and confirmed   under  Section  25(1)  of  the   Act,   adopting Government rules    to regulate the conditions of service of officers  and  servants  of  the  Municipal  Committee,  the Fundamental  Rules,  Civil Service  Regulations,  Government Servants’  Conduct Rules, and General Book Circulars of  the State  Government, as amended from time to time, etc.  would apply  to  the officers of the Municipal Committee  and  the previous rules were superseded and were no longer in  force. Hence  the reliance placed by the High Court on Rule  14  of the Municipal Officers’ and Servants’ Rules is wrong. [324D- E, G-H]                                                        323

JUDGMENT:      CIVIL  APPELLANT JURISDICTION: Civil Appeal No. 722  of 1978.      From  the  Judgment and Decree dated 11.4.1977  of  the Madhya Pradesh High Court in Second Appeal No. 315 of 1970.      S.K.Gambhir for the Appellant.      S.S. Khanduja for the Respondent .      The Judgment of the Court was delivered by      K.RAMASWAMY,J. The facts in this appeal would lie in  a short  compass.  The appellant appointed the  respondent  as Lower  Division Clerk on September 22, 1966 and put  him  on probation  for  a  period  of two  years  which  expired  on September  21,  1968.  On December 9,  1968,  the  appellant served him with one month’s notice terminating the  services with  effect from January 9, 1969. Calling in  question  the order  of  termination,  the respondent laid  the  suit  for declaration  that  the termination without  enquiry  and  an opportunity  of being heard was violative of Rule 9A of  the Madhya Pradesh Civil Service Classification Control & Appeal (Rules), 1966 with consequential declaration that he  became a  permanent  employee of the corporation with  cotiuity  of service and arrears of salary. The Trial Court dismissed the suit  and  on  appeal it was confirmed. The  High  Court  in Second Appeal No. 315/70 by judgment and decree dated  April 11,  1977 allowed the appeal and decreed the suit as  prayed for.  On  leave  under Art. 136  the  Appellant  filed  this appeal.      Shri  S.k.Gambhir,  learned counsel for  the  appellant contended that the respondent being  a probationer, acquires permanent  status only on confirmation. Before  confirmation the  appellant  had  exercised its power, in  terms  of  the

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rules,  and  terminated the respondent’s service.  The  High Court committed manifest error of law in its finding that on expiry of two years period of probation the respondent  must be  deemed  to  have been confirmed under  Rule  14  of  the Municipal  Officers and Servants Recruitment Rules which  no longer  were in force. He further contended that rule  8  of the Madhya Pradesh Government Servants’ General   Conditions of  Service  Rules,  1961 for short  ’the  Rules’  expressly provides confirmation of probation as a condition precedent. Notice   was   issued   terminating   the   service   before confirmation and so it is valid in law. Shri S.S.  Khanduja, learned  counsel  for  the  respondent  contended  that   by operation of the resolution passed                                                      324 by  the  Municipal Corporation under s. 25  of  the  Central Provinces  and  Berar Municipality Act  1922  the  Municipal Officers  and  Servants are governed  by  recruitment  rules thereunder.  Rule  14 thereof, relied on by the  High  Court expressly  provided  to put an employee on probation  for  a period  of two years subject to being confirmed. At the  end of  the  probationary period, if the probationer  was  found unfit,  the  Municipal Committee shall, if he was  a  direct recruit,  to  dispense with his service and if he  has  been recruited  by  tranfer, to revert to his original  post.  On expiry  of the period of two years, no action was  taken  by the Municipal Corporation. Therefore, the respondent must be deemed  to  have been confirmed. Thereafter the  only  power which  the Corporation had was to terminate the  service  of the  respondednt in accordance with  Classification  Control and Appeal Rules after conducting an enquiry and giving  him reasonable  opportunity  that too for  misconduct.  No  such procedure  was adopted. Therefore, the impugned  notice  was illegal  and  the High Court was justified in  granting  the decree.      The  first  question is, which are the  relevant  rules that would be applicable to the respondent? Admittedly,  the Municipal Council became a Municipal Corporation on or after August 26, 1967. A resolution was passed making a draft bye- law by a Municipal Council on November 11, 1960,  exercising the  power under s. 178(3) of the Madhya  Pradesh  Municipal Act, 1922 and confirmed the same under s. 25 (1) of the said Act, adopting Government Rules to regulate the conditions of service  of  officers and servants  of  Municipal  Committee which provides thus:           "The  fundamental  rules  and  the  Civil  Service           regulations as amended from time to time in  their           applications to M.P., the M.P.Government  Servants           Conduct  Rules 1959, as amended from time to  time           and  the  General Book Circulars of the  Govt.  of           M.P. as in force for the time being shall apply to           the officers and servants of the M.C. in the  same           way as they apply to Govt. Servants". Thus, it is clear that the Fundamental Rules, Civil  Service Regulations,  Govt, Servants Conduct Rules and  the  General Book  Circulars  of  the Government  of  Madhya  Pradesh  as amended from time to time, etc. shall apply to the  officers and servants of the Municipal Committee. The Previous  rules were  thus superseded and were no longer in force.  Reliance on  Rule  14 referred to above made by the  High  Court  is, therefore, wrong. Rule 8 of the Rules reads thus:                                                      325           "Probation-(1) A person appointed to a service  or           post  by  direct recruitment shall  ordinarily  be           placed  on  probation for such period  as  may  be           prescribed.

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         (2)  The appointing authority may, for  sufficient           reasons,  extend  the  period of  probation  by  a           further period not exceeding one year.           Note - A probationer whose period of probation  is           not  extended  under  this Sub-Rule  but  who  has           neither been confirmed nor discharged from service           at  the  end of the period of probation  shall  be           deemed to have been continued in service,  subject           to  the condition of his service being  terminable           on  the expiry of a notice of one  calender  month           given in writing by either side.           (3) A probationer shall undergo such training  and           pass  such  departmental examinations  during  the           period of his probation as may be prescribed.           (4) and (5) are not relevant, hence omitted.           (6) On the successful completion of probation  and           the   passing  of  the   prescribed   departmental           examinations,  the probationer shall be  confirmed           in  the  services  or post to which  he  has  been           appointed." Thus,  it  is  clear  from Rule 8  of  the  Rules  that  the procedure  to  place  a direct recruit on  probation  for  a prescribed  period  was provided. The  appointing  authority would be entitled to place a direct recruit on probation for a specified period and for sufficient reasons may extend the period  of probation to a further period not  exceeding  one year.  Under the note to sub-rule (2) if the probationer  is neither confirmed nor discharged from service at the end  of the  period  of probation, he shall be deemed to  have  been continued in service as probationer subject to the condition of his service being terminated on the expiry of a notice of one  calender month given in writing by either side. As  per sub-rule   (6)  on  passing  the   prescribed   departmental examination  and on successful completion of the  period  of probation, the probationer shall be confirmed in the service or  post to which he has been appointed. Then he becomes  an approved  probationer.  Therefore, after the expiry  of  the period of probation and before its confirmation, he would be deemed to have been continued in service                                                       326 as  probationer. Confirmation of probation would be  subject to  satisfactory completion of the probation and to pass  in the  prescribed  examinations.  Expiry  of  the  period   of probation, therefore, does not entitle him with a right to a deemed  confirmation.  The  rule  contemplate   to  pass  an express  order of confirmation in that regard. By  issue  of notice of one calender month in writing by either side,  the tenure could be put to an end, which was done in this  case. In   State  of  Punjab  v.Dharam  Singh,  [1968]  3  SCR   1 considering  the  effect  of  continuing  a  probationer  in service  after  the period of probation was  completed,  the Constitution  Bench  held  that there was no  rule  for  the extension of probation after October 1, 1960 and it was  not possible  to  presume the competent  authority  extended  it beyond  October 1, 1960.Thus in the above case there was  no power  to  extend  the probation in  the  rules  beyond  the specified period. It was held that:           "The   initial   period  of   probation   of   the           respondents ended on October 1, 1958. By  allowing           the   respondents  to  continue  in  their   posts           thereafter   without   any   express   order    of           confirmation,  the  competent  authority  must  be           taken  to  have extended the period  of  probation           upto October 1, 1960 by implication. But under the           proviso  to  Rule 6(3),  the  probationary  period

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         could  not extend beyond October 1, 1960. In  view           of the proviso to Rule 6(3), it is not possible to           presume that the competent authority extended  the           probationary period after October 1, 1960, or that           there  after  the respondents  continued  to  hold           their posts as probationers". Accordingly  it  was held that the  respondent  therein  was deemed to have been confirmed.      In  Om  Prakash Maurya v.  U.P.  Co-op.Sugar  Factories Federation,  Lucknow & Ors. [1986] Suppl. SCC 95 this  Court held  that  U.P. Co-op. Sugar Factories  Federation  Service Rules,  1976 made under  the U.P. Co-op. Societies Act  were in force. Regulations 17 of 1975 Regulations does not permit continuance  of  an employee for a period of more  than  two years.  One  year normally was the period of  probation  and further being extended to a period of one more year. Rule  5 of 1976 Rules does not prescribe any limit on the  extension of the probationary period. In the light of the operation of those  rules when the probationary period was prescribed  on promotion  to  the  post  of  Commercial  Officers  with   a condition  that his probationary period may be extended  and he could be reverted to the post of Office Superinten-                                                        327 dent   without  any  notice,  this  Court  held   that   the stipulation  for  extension of probationary  period  in  the appointment order must be considered in accordance with  the proviso   to   regulation  17(1)  which   means   that   the probationary  period could be extended for a period  of  one year  more and the probationary period was further  extended to one year during which period the service of the appellant was   neither  terminated  nor  was  he  reverted   to   his substantive  post, instead he was allowed  to  continue.  On those  facts  this  Court  held  that  "since  under   those regulations’  appellant’s probationary period could  not  be extended  beyond the maximum period of two years,  he  stood confirmed on the expiry of maximum  probationary period  and there after he could not be reverted to lower post  treating him  on probation". In M.A. Agarwal v. Gurgaon Bank &  Ors., [1987] Suppl. SCC 643 and in State of Gujarat v. Akhilesh C. Bhargav  & Ors. [1987] 3 SCR 1091 this Court reiterated the same view.      Exercise of the power to extend the probation is hedged with  the existence of the rule in that regard  followed  by positive  act  of either confirmation of  the  probation  or discharge from service or reversion to the substantive  post within  a reasonable time after the expiry of the period  of probation.  If  the  rules do  not  empower  the  appointing authority  to  extend the probation  beyond  the  prescribed period, or where the rules are absent about confirmation  or passing of the prescribed test for confirmation of probation and inaction for a very long time may  lead to an indication of  the  satisfactory completion of probation. But  in  this case  Rule 8 expressly postulates otherwise. The  period  of probation  is subject to extension by order in  writing  for another   period  of  one  year.  Passing   the   prescribed examinations  and successful completion of probation and  to make an order of confirmation are condition precedent.  Mere expiry   of  the  initial  period  of  probation  does   not automatically have the effect of deemed confirmation and the status of a deemed confirmation of the probation. An express order in that regard only confers the status of an  approved probationer.  We are of the view that note to  sub-rule  (2) read  with sub-rule (6) of Rule 8 manifests the  legislative intent that confirmation of the probation of the  respondent would be made only on successful completion of the probation

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and  the passing of the prescribed examinations. It  is  not the  respondent’s case that he passed all the  examinations. He  shall  be deemed to be continued  on  probation.  Before confirmation  the  appointing  authority  is  empowered   to terminate   the  service of the probationer  by  issuing  on calender month’s notice in writing and on expiry thereof the service  stands  terminated   without  any  further  notice. Within three months from the date of expiry of original two                                                     328 years period of probation and within one year’s period,  the order of termination was made. In this view the question  of conducting  an inquiry under the Classification Control  and Appeal (Rules) after giving an opportunity and that too  for specific charges does not arise. The High Court,  therefore, committed manifest error of law in decreeing the suit. By an interim order passed by this court, the respondent  received a  sum of Rs. 5,000 from the appellant. The appellant  shall not  recover  the same from him. The appeal  is  accordingly allowed.  The judgment and decree of the High Court  is  set aside  and  that of the Trial Court and  the  Ist  Appellate Court  are confirmed. But in the circumstances  parties  are directed to bear their own costs. N.P.V.                                      Appeal allowed.                                                    329