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PETITIONER: RADHEY SHYAM GUPTA

       Vs.

RESPONDENT: U.P. STATE AGRO INDUSTRIES CORPORATION LTD. & ANR.

DATE OF JUDGMENT:       15/12/1998

BENCH: K.VENKATASWAMI, & M. JAGANNADHA RAO.

ACT:

HEADNOTE:

JUDGMENT: JUDGMENT -------- M. JAGANNADHA RAO. J. -------------------- Leave granted. This  appeal   is   preferred   by   the   appellant questioning  the  judgment  of  the  High Court of Allahabad dated 10.12.97 (Lucknow Bench) which reversed  the  Judgment of the Administrative Tribunal III, Lucknow in claim No. 686 of TIII of 1977 dated 3.12.80. The  appellant  was  working   in   the   respondent Corporation as   Senior   Accountant  from  27.7.1970.    On 17.7.1973, he was appointed as Branch Manager and posted  at the  Meerut  Division  of  the  respondent  Corporation  and transferred to various places.  He was posted at Faizabad as Branch Manager on 3.10.1975 and while he was working  there, he  received  a  letter  dated  12.1.1976  from the Managing Director on 15.1.1976 alleging that one person by  name  Jai Chandra  Lal  complained that the appellant had fraudulently taken Rs.  2000/- from him and  that  the  appellant  should therefore offer  his  explanation.  The appellant denied the allegation and submitted his explanation  on  22.1.1976  was submitted   by  one  Sri  Ram  Pal  Singh,  General  Manager (Fertiliser) without  issuing  any  Charge  Memo  or  giving hearing.   Copy  of  the  report  was  also not given to the appellant.  Thereafter, on  23.1.1976,  a  simple  order  of termination  was  passed stating that the appellant had been appointed as Branch Manager by order  dated  17.7.1973,  and Condition  No.3  of  the appointment order provided that the services of the appellant could be terminated  at  any  time after  giving  one month’s notice or one month’s day in lieu thereof and that his services  were  being  terminated  with immediate  effect  in  terms of the aforementioned Condition No.  3 of the appointment order.  It  was  stated  that  the appellant  could  obtain  one  month’s  day from the General Manager (Fertiliser), Lucknow. It   was   the   appellant’s   case    before    the Administrative    Tribunal,   Lucknow,   that   though   the termination order appeared to be  innocuous,  it  was  still punitive  in  nature  inasmuch as it was based on an experts

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report of inquiry by the said Ram Pal  Singh  and  that  the allegation of  accepting a bribe in a sum of Rs.  2000/- was not merely the motive but the very foundation of  the  order of termination.    The  appellant  also  raised  a  plea  of malafides against the said Shri Ram Pal Singh who  allegedly bore  a  grudge against the appellant as the appellant while working at  Meerut  in  1973-74  had  made  certain  serious complaints against one Balbir Singh Chauhan, Assistant Sales Officer-I  - who was a close friend of the said Shri Ram Pal Singh.  In fact, soon after the appellant complained against Balbir Singh, a letter of transfer  is  said  to  have  been engineered  and the appellant was transferred to Varanasi on 9.5.74.  Various details have been given to prove malafides. The Administrative Tribunal, Lucknow  in  its  order dated  31.12.80  accepted  the  appellant’s  contention  and allowed  the  appellant’s  application   and   quashed   the termination order declaring it to be violative of principles of natural  Justice  and  hence viod.  It also held that the inquiry report of Shri Ram Pal Singh was a malafide one.  It was however stated that the respondents would be at  liberty to initiate regular inquiry if they so desired and deal with the appellant’s case in accordance with law. Aggrieved  by  the  said  judgment,  the  respondent Corporation filed Writ Petition No.  1591 of  1981  and  the same  was allowed by the High Court on 10.12.97 holding that though an inquiry was conducted by Shri Ram Pal Singh and  a report  was  given  against  the  appellant,  the  same  was conducted "to assess the work" of the appellant  as  it  was decided  to  dispense with his temporary service in terms of Condition No.3 of the order of appointment, which  permitted such  termination  on payment of one month’s salary or after giving one month’s notice.  That was why a simple  order  of termination  was  passed  and  it  did  not cause any stigma inasmuch as it did not refer to  any  disciplinary  inquiry. There    was   "sufficient   material"   to   indicate   the unsatisfactory work and conduct of the appellant.  The  High Court  referred  to  various  decisions  relied  upon by the appellant and said that they did not apply.  It however held that the ruling of this Court in State of U.P.  vs.  Kaushal Kishore  Shukla  (1991(1)  SCC  691)  was  in  point,   that whenever,  the  competent  authority  was satisfied that the work  and  conduct  of  a   temporary   employee   was   not satisfactory,  it  could  pass a simple order of termination and such an order could not be treated as one of punishment. The High Court also referred to Triveni Shanker  Saxena  vs. State of  U.P.    [1992 Suppl.(1) SCC 524] and State of U.P. vs.  Km.  Premlata Misra [1994 (4) SCC 189].  The High Court held as follows:         "In view of the law laid down by the Hon’ble Supreme         Court, we are of  the  opinion  that  the  temporary         services  of  the  respondent  No.1  have  not  been         terminated by  way  of  punishment  founded  on  any         misconduct  but  on  the  other  hand, the competent         authority has found that the respondent No.1 was not         fit to  be  continued  in  services  on  account  of         unsatisfactory work   and  conduct.    There  is  no         material to establish that the respondent  No.1  had         outstanding or meritorious service record."         It further observed:         "Further  in  view  of  the law laid down by Hon’ble         Supreme  Court,  even  if  some  parte   preliminary         inquiry  has  been conducted or disciplinary inquiry         was initiated to inquire into some misconduct, it is         the potion of the competent  authority  to  withdraw         the  disciplinary proceedings and take the action of

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       termination  of   service   under   the   terms   of         appointment  and  the  same  would  not be by way of         punishment." One  this  reasoning,  the  Writ  Petition  of   the Corporation  was  allowed, the order of the Tribunal was set aside and the termination order was upheld. Aggrieved by the Judgment of  the  High  Court,  the appellant has preferred this appeal.  It is contended by the learned senior  counsel  for  the  appellant Sri M.L.  Verma that the High Court had  assumed  that  the  inquiry  was  a preliminary  inquiry  report  but it was in fact a final one which gave findings as to the  quilt  of  the  appellant  in regard  to  the  allegation  of  receiving  a  bribed of Rs. 2000/- and the said finding  was  arrived  at  by  examining witnesses  behind  the  back  of the appellant and therefore there  was  a  clear  violation  of  principles  of  natural justice.  In other words, the findings in the inquiry report were the  ’foundation’  for the termination.  This was not a case where some allegations against the appellant  were  the ’motive’.  It was permissible for the Court to go behind the order and  find  out  if  it was punitive in nature.  It was also argued that the High Court was in error  in  not  going into  the question of malafides even though the Tribunal had held that the inquiry report was vitiated by malafides. On  the  other  hand,  learned   counsel   for   the respondent, Sri J.M.  Khanna made a vehement submission that the  termination was the result of a preliminary inquiry and it was always permissible to rely on  such  an  inquiry  and pass  a  simple  order  termination  by giving a one month’s notice or giving one  month’s  pay  in  lieu  thereof.    He contended  that it was not permissible for the Court to look into the report given by Sri Ram Pal Singh  to  the  General Manager as  the  same was confidential in nature.  The Court could not go behind the order. On the basis of the above contention, the  following point arises for consideration: Whether  the  report  of  Sri  Ram  Pal  Singh was a preliminary report and whether it  was  the  motive  or  the foundation  for  the  termination  order  and whether it was permissible to go behind the order? On  this point, the question is whether the contents of the report dated 22.1.76 of Sri Ram Pal Singh against the appellant were the motive or foundation for the  termination order dated 23.1.76 issued by the General Manager? Now,  there  are  two lines of cases decided by this Court which deal with the question in  issue.    In  certain cases of temporary servants and probationers, this Court has taken the view that if the experts inquiry or report are the motive  for  the  termination order, then the termination is not to be  called  punitive  merely  because  principles  of natural justice  have not been followed.  On the other hand. there is another line of cases where  this  Court  has  held that  the  facts  revealed in the inquiry are not the motive but the foundation for the termination of  the  services  of the  temporary  servant  of  natural  justice  have not been followed, and such orders are to be  declared  void.    This Court  has  held  that  for finding out whether a given case falls  within  either  of  these  two  categories,   it   is permissible for the High Court or Administrative Tribunal to go  behind  the  order  and  look  into  the  record  of the proceedings,  the  antecedent  and  attendant  circumstances culminating in the order of termination. In  what  situations  the  allrgations of misconduct will be the motive and  in  what  cases  they  will  be  the foundation, it is argued, is not clear enough.

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In fact, Krishna Iyer, J.  his characteristic  style described  the words ’form’ substance, motive and foundation as the face of an inscrutable sohink, baffling  lawyers  and judges alike.   [See Samsher Singh vs.  State of Punjab 1974 (2) SCC 831 (at 889)].  According to him, the need  in  this branch  of  law  is  to  lay down a simple test which can be grasped by the administrator or Civil servant  without  much subtlety. De Smith says, as    to  procedural  fairness  where preliminary inquiries are conducted (See 5th Ed., 1995 (page 491,  para  10.027)  that the question of "proximity between investigation and act or decision" depends on the degree  of proximity  so far as the person affected claiming a right of hearing is concerned. He says:         "Thus,  a  person empowered or required to conduct a         preliminary   investigation   with   a    view    to         recommending or deciding whether a formal inquiry or         hearing  (which  may  lead  to a binding and adverse         decision) should take place, is not  normally  under         any  obligation  to  comply  with  rules of fairness         (Beetham vs.  Trinided Cement Co.  1960 A.C..   132;         Medical  Board  of  Queens  Land  vs Byme College of         Physicians, ex P Samuels (1996) 58 D.L.R.(2ND)  622;         Re; Drummoyne M.C.   (1962).    S.R.   (N.S.W.) 193.         But he may be placed under such an obligation if his         investigation is an integral part of a process which         may terminate in action adverse to the interest of a         person claiming to be heard before  him.    (Wiseman         vs.  Borneman  1971  AC 297).  Re:All General Canada         and Canadian Tabacoo Manufacturers’  Council  (1986)         26.D.L.R (4th) 677." The  above  principles stated in De Smith are, as we shall presently see, very close to  what  is  laid  down  in Samsher Singh’s case and other cases decided by this Court. It   is,   therefore,  necessary  to  refer  to  the development of the law in this branch between 1958  to  1974 in  the  first  phase  -  a development which was noticed by Krishna Iyer,  J.  in  the  above  case  and  also  by  E.S. Venkataramiah,J.  (as  the  then  was)  in Anoop Jaiswal vs. Government of India (1984 (2) SCC 369). There are atleast seven Constitution Bench Judgments and & Judgment of seven Judges of this Court on this  issue. It  will  be  seen that form stage to stage the law has been developed. The  first decision of the Constitution Bench was in Parshottam Lal Dhingra vs.  Union  of  India  [AIR  1958  SC 826].   There  a twin test was laid down - whether the order in terms of the appointment gave a right  to  terminate  and whether the order was punitive in nature.  If misconduct was motive,  the  order  was  not  punitive  but  if  it was the foundation it was punitive.  In that case, the employee  was working in a higher post in an officiating capacity and that appointment was terminated and he was reduced in rank.  S.R. Das, C.J.      stated   (para  28)  (p49)  that  misconduct, negligence, inefficiency or other disqualification might  be the  motive  or  the  inducing  factor  which influenced the Government to take action under the terms of the contract of employment or the specific service rule, and the motive  was irrelevant.    But  if  the  termination  was  ’founded’  on misconduct,    negligence,     inefficiency     or     other disqualification,   it   would  have  to  be  treated  as  a punishment.  It was also held  that  the  use  of  the  word ’termination’ or  ’discharge’  was not conclusive.  In spite of the use of such innocuous expressions,  the  Court  could still hold  it  be  punitive.   On the facts of the case the

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termination of the officiating appointment  was  based  upon certain  adverse  remarks and it was held that it was not by way of punishment. Next came the decision of the Constitution Bench  in State of  Bihar  vs.  Gopi Kishore Prasad [AIR 1960 SC 689]. Here a test of ’inquiry’ was laid down.   That  was  a  case probationer.   The Government had come to the conclusion, on inquiry, that the respondent was  unsuitable  for  the  post held on  probation.    Because  of  the inquiry, Sinha, C.J. held this to be "clearly by way of punishment."  Termination (without  notice)  but  after  holding  an  inquiry into the alleged misconduct or inefficiency or  some  similar  reason would be   punitive.    Government  could  not,  "brand  him dishonest and incompetent without inquiry." If it did so, it would be by way of punishment, but not if the position  "was that  he  was found unsuitable’, without holding an inquiry. Both Dhingra and Gopi Kishore Prasad were decided  when  the law in this branch was just developing. However Shah,J.  (as he then was) in State of Orissa vs.  Ram Narayan Das [1961 (1) SCR 606] gave a new dimension to the  legal  principles.    That  case  also  related to a probationer but was governed  by  Rule  55-B  of  the  Civil Services  (Classification,  Control  and Appeal) Rules which was a special provision and which stated that "where  it  is proposed  to  terminate  the  employment  of  a probationer, whether during or at the and of the period of probation, for any specific fault or on account of  his  unsuitability  for the  service,  the  probationer  shall  be  apprised  of the grounds of such proposal and given an opportunity  for  show cause  against it, before orders are passed by the authority competent to terminate  the  employment."  if  the  test  of ’industry’  laid  down by Sinha, CJ was to be applied, every termination of a probationer made by following the rule  and conducting an  inquiry would become punitive.  The ’industry test’ (as pointed out  by  Krishna  Iyer,  J.    in  Samsher Singh’s case  broken  down.    A  new  test had to invented. Therefore Shah, J.  (as he then was) laid down  a  new  test which  required that one should look into "object or purpose or the inquiry" and not merely hold the  termination  to  be punitive merely  because  of  an  antecedent industry.  J.C. Shah, J (as he then was) said:         "Whether  it  amounts  for  an  order  of  dismissal         depends upon the nature of the inquiry, if any,  the         proceedings  taken  therein and the substance of the         final orders passed on such inquiry." The  learned  Judge  pointed  out  that the employed being a probationer, "the inquiry against the respondent was for ascertaining whether he was fit to  be  confirmed."  His Lordship  pointed  out that this inquiry was not of the same nature as an inquiry into charges of misconduct, negligence, inefficiency or other disqualification.   On  the  facts  of thee  case,  the  termination  of  a  probationer was upheld inasmuch as the purpose of the inquiry was to  find  out  if the employee could be confirmed.  The purpose of the inquiry was  not  to  find  out  if he was guilty of any misconduct, negligence, inefficiency or other disqualification. We then come  to  the  third  case  decided  by  the Constitution  Bench  in  Madan Gopal vs State of Punjab (AIR 1963 SC 5312.  Here Shah, J.  (as he then was), applied  the same  principle laid down earlier by him out in this case he held the order was punitive.  That was a case of a temporary employee.  There was a  report  of  the  Settlement  Officer about  the  ’misconduct’ of the employee and the termination was based on the said report.  It was, therefore, held  that though  the  order  of  termination was an order simpliciter

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still the Court could go behind the same and further if thee foundation was the finding as to misconduct, then the  order was punitive.    The  termination  order  was  quashed, even though  the  employee  participated  therein   because   the statutory  procedure  for a regular departmental inquiry was not followed.  Emphasis was again made on  the  "purpose  of the inquiry".   The distinction between the earlier case and this case was that while  in  Ram  Narayan  Das’  Case,  the inquiry  was  made  to  find out if the probationer could be continued and confirmed and was,  therefore,  not  punitive, the  position in the Madan Gopal’s case was that the inquiry by the Settlement Officer was to find out  if  the  employee was guilty of misconduct.  In fact the termination order was based on the inquiry held behind his back and was held to be punitive.  In Ravindra Chandra vs.  Union of India (AIR 1963 SC 1552), being a case of a probationer to whom Rule 55-B of the Central  Rules  applied,  Wanchoo  J.   (as he then was) upheld the order on the ground that the limited  purpose  of the inquiry was to find out whether he could be ’retained or not’ in  the  service.   In other words, the inquiry was not with a view to see if the employee had misconducted  in  his duties.  This case was similar to Ram Narayan Das case. The  theory  of  ’object of the inquiry’ was further emphasised by the Constitution Bench in Jagdish  Mitter  vs. Union of India.    [AIR  1964 SC 449].  That was a case of a temporary employee.  The discharge from service was  by  way of an  order  ’simpliciter’.  But there, an inquiry was held and the termination order was based on it as  it  stated  on its  face  that  it  was  ’found  undesirable’ to retain the employee and hence his services were being terminated.   The order  was  held to be punitive on its face and was quashed. Gajendragadkar, J.  (as he then was) discussed  the  earlier cases and held that in every case the purpose of the inquiry was crucial.   If the inquiry was held ’only for the purpose of  deciding  whether  the  temporary  servant   should   be continued  or  not,  it could not be treated as punitive and that the motive operating in the mind of the  authority  was not relevant.   But "the from in which the order terminating the service is expressed will not be decisive." It was  held that "what the Court will have to examine in each case would be,  having  regard  to the material facts existing upto the time of discharge, is the order of  discharge  in  substance one of  dismissal".    Therefore,  the  ’form’  was  not  of importance but the ’substance’ was. Finally, we come to  the  seventh  case,  Champaklal Chimanlal Shah  vs.    Union  of India [AIR 1964 SC 1854], a case strongly relied upon by the  learned  counsel  for  the respondent,  Shri  J.M.  Khanna.  Here, it was the case of a preliminary inquiry which was intended  to  find  out  if  a prima   facia   case   was  made  cut  to  start  a  regular departmental inquiry. The question was whether a termination order passed soon after the completion  of  the  preliminary inquiry  could  be  treated  as punitive. Wanchoo, J. (as he then was) held that it  could  not  be  as  held.  Once  the preliminary  inquiry  was  over, it was open to the employer not to make a regular inquiry for proving the quilt  of  the employee.  The  employer could stop at that stage and pass a simple order  of  termination.  The  facts  as  gathered  or revealed  in the preliminary inquiry would be the motive and not the ’foundation’ since there was no inquiry as to  their correctness  made.  The  order could not be quashed as being punitive. We finally come to the seven Judge Judgment rendered in Samsher  Singh vs.  State of Punjab [1974 (2) SCC 831] to which we made a brief reference at  the  beginning  of  this

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Judgment.  The case concerned two Judicial Officers.  So far as  the  termination  order  passed against Sri Ishwar Chand Aggarwal was concerned, it was  quashed  holding  it  to  be punitive as it was based on the report of an Inquiry Officer appointed  by the Director of Vigilance. The Inquiry Officer recorded statements of witnesses  behind  the  back  of  the officer  and  definitive findings therein were the basis for the termination. It was not a preliminary inquiry.  A.N.Ray, C.J.  held  that  the  object of the said inquiry was (see p 055) (para 79 and 80)         "to  ascertain  the  truth  of  the  allegation   of         misconduct.   Neither  the report nor the statements         recorded  by  the  Enquiry   Officer   reached   the         appellant.  The Inquiry Officer gave his findings of         misconduct.  ...    The  order  of  termination  was         because of the recommendation in the report.         The order of termination of the services  of         Ishwar   Chand   Aggarwal   is  clearly  by  way  of         punishment in the facts  and  circumstances  of  the         case....   The  form of the order is not decisive as         to whether the order is by way of punishment.   Even         an  innocupusly worded order terminating the service         may, in the facts  and  circumstances  of  the  case         establish that an inquiry into allegation of serious         and  grave  character of misconduct involving stigma         has been made in infraction of Article 311.  In such         a case, the simplicity of the form of the order will         not give any sanctity.  That  is  exactly  what  has         happened in  the case of Ishwar Chand Aggarwal.  The         order of termination is  illegal  and  must  be  set         aside." A.N.Ray,  C.J..  wrote  the  opinion for himself and five other learned Judges, Krishna Iyer, J. wrote a separate but  concurring  Judgment  where  he  referred  to  the  new dimension  to  the law given by Shah, J. (as he than was) in the sixties. The learned Judge said that the  words  ’form’, ’substance’, ’motive’ and ’foundation’ were baffling and the need of the hour was a simple test. If  there was any difficulty as to what was ’motive’ or ’foundation’ even after Shamsher Singh’s case,  the  said doubts, is our opinion, where removed in Gujarat Steel Tubes vs.   Gujarat  Steel  Tubes Mazdoor Sangh (1980 (2) SCC 593) again by Krishna Iyer, J.  No doubt.  it is a Labour  matter but   the   distinction  so  far  as  what  is  ’motive’  or ’foundation’  is  common  to  Labour  cases  and  cases   of employees in government or public sector.  The learned Judge again  referred  to  the  criticism by Shri Tripathi in this branch  of  law  as  to  what  was  ’motive’  or  what   was ’foundation’,  a  criticism  to  which reference was made in Samsher Singh’s  case.    The  clarification  given  by  the learned Judge is, in our opinion, very instructive, It reads as follows (at page 616-617):         "Masters and servants cannot be  permitted  to  play         hide  and  seek  with  the law of dismissals and the         plain and proper criteria are not to be  misdirected         by  terminological cover-ups or by appeal to psygnic         by terminological cover-ups or by appeal to  psycnic         reason   for   the   order,   whether  disclosed  or         undisclosed.  The Court will  find  out  from  other         proceedings  or  documents connected with the formal         order of termination what the true  ground  for  the         termination is.   If thus scrutinised, the order has         a punitive flavour in cause or  consequence,  it  is         dismissal.   If  it  falls  short  of  this test, it         cannot be called a punishment.  To put  if  slightly

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       differently,  a  termination  effected  because  the         master is satisfied of the  misconduct  and  of  the         consequent  desirability  of terminating the service         of the delinquent servant, it is a  dismissal,  even         if  he  had  the  right  in law to terminate with an         innocent  order  under   the   standing   order   or         otherwise.   Whether, in such a case the grounds are         recorded in a different proceedings from the  formal         order does not detract from is nature.  Nor the fact         that, after being satisfied of the quilt, the master         abandons  the  enquiry  and  proceeds  to terminate.         Given an alleged misconduct and a live nexus between         it and the termination of service the conclusion  is         dismissal,  even  if  full  benefits  as  on  simple         termination, are given and non-inqurious terminology         is used.         On the contrary,  even  if  there  is  suspicion  of         misconduct  the master may say that he does not wish         to bother about it and may not go into his quilt but         may feel like not keeping a  man  he  is  not  happy         with.   He  may not like to investigate nor take the         risk of continuing a dubious servant.   Then  it  is         not  dismissal  but  termination  simpliciter, if no         injurious record of  reasons  or  punitive  peculary         cut-back  on  his  full  terminal benefits is found.         For, in fact, misconduct  is  not  then  the  moving         factor in  the  discharge.   We need not chase other         hypothetical situations here. In  other  words, it will be a case of motive if the master, after gathering some prima  facie  facts,  does  not really wise to go into their truth out besides merely not to continue a  dubious  employee.   The master does not want to decide or to direct  a  decision  about  the  truth  of  the allegations,  but if he conducts an inquiry only for purpose proving the misconduct and the employee is not heard, it  is a   case  where  the  inquiry  is  the  foundation  and  the termination will be bad. Subsequent to the above cases,  there  have  been  a number  of  other cases where the above principles have been applied.  We shall refer to a few of them  where  some  more principles have been discussed.   In State of U.P.  vs.  Ram Chandra Trivedi {1997 (1) SCR 462]  the  employee’s  service were  terminated  as  he  allowed  some  other  employee  to impersonate him in an examination.  The order was  innocuous put the case was preceded by an inquiry and it was held that the  petitioner in his pleadings had not made out a case for calling for departmental records to examine if it was a case of punishment.  That was how  this  case  was  explained  by Pathak, J.    (as  he  then was) in State of Maharashtra vs. S.R.  Saboji [1971 (4) SCC  466].    In  Anoop  Jaiswal  vs. Government  of  India  [1984  (2) SCC 369] it was held while quashing the order of termination, that it was open  to  the Court   to   go  behind  the  order  and  find  out  if  the report/recommendation  of  the  superior  authority  was   a camouflage  and  if that was the basis or foundation for the order the report/recommendation,  then  it  should  be  read along with the order for the purpose of determining the true character of  termination.    If  on  a  reading  of the two together, the Court reached the conclusion that the  alleged finding  of  misconduct was the cause or basis of the order, and that but for the report containing such a  finding,  the order  would  not  and  could  not  have  been  passed,  the termination order would have to fall to the ground as having been passed without the officer being afforded a  reasonable opportunity.   It was also held that it was wrong to presume

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that an order would be punitive only if  a  regular  inquiry was  conducted  exparte  or  behind the back of the officer. Even if it was not a  regular  inquiry,  any  other  inquiry where  evidence  was  taken and findings were arrived behind the  back  of  the  officer,  would  make   the   subsequent termination bad.   Vankataramiah,  J.    (as  he  then  was) pointed out in the above  case  the  shift  in  the  law  as brought about by Samsher Singh’s case. So far  as Triveni Shankar Saxena vs.  State of U.P. [1992 Suppl.  (1) SCC 524] and State of U.P.  vs.  Prem Lata Motors, [1994 (4) SCC 189], relied upon by  the  High  Court are concerned, in the former case, the termination order was a  simple order which did not cast any stigma and there were several adverse entries in his confidential  reports.    The termination was  as  per  rules.    In  the  latter case the employee’s superiors complained that the  employee  was  not regular  in her work, and was in the habit of leaving office during office  hours.    A  simple  order   of   termination appointment.  There  was  no  prior  inquiry.  In both these cases, the termination orders were upheld. We shall now refer to  a  different  type  of  cases where a departmental inquiry was started, then dropped and a simple order  of termination was passed.  In State of Punjab vs.  Sukh Raj Bahadur [1968 (3) SCR 234],  the  charge  memo was  served,  reply  given  and  at  that  stage itself, the proceedings were dropped and a termination order was passed. The  High  Court  felt  that  the  ’object  of  departmental inquiry,   being  to  punish  the  employee,  the  order  of termination must be treated  as  punitive.    This  was  not accepted  by  a three Judge Bench consisting of Justice Shah (as he then was) who had laid down  in  Madan  Gopal’s  case (AIR  1963 SC 531) the principle of ’object of the inquiry’. This court reversed the High Court Judgment  and  held  that neither  Madan  Gopal’s  case nor Jagdish Mitter’s case (AIR 1964 SC 449) applied.  This was because in the  case  before them  the  inquiry  did  not  go  beyond  the  stage  of the explanation.  No findings were given and no  inquiry  report was submitted as in the above two cases.  In that case (i.e. Sukh  Raj Bahadur) this Court felt that the decision in A.G. Benjamin vs.  Union of India (Civil Appeal No.  (341 of 1966 dated 13.12.1966) (SC) was more direct.  In Benjamin’s case, a charge memo was issued, explanation was  received  and  an Enquiry  Officer  was  also appointed but before the inquiry could be completed, the  proceedings  were  dropped  stating that:   ’departmental  proceedings  will  take a much longer time and we are not sure whether after going through all the formalities, we will be able to deal with the accused in the way he deserves." There also, the order was held not  to  be punitive.   Following the above case, this court in Sukh Raj Bahadur’s case stated that  the  position  before  them  was similar to what happened in Benjamin’s case and concluded as follows:         "the departmental inquiry did not proceed beyond the         stage of submission of a chargesheet followed by the         respondent’s explanation thereto.  The  inquiry  was         not  preceded  with,  there  were no sittings of any         inquiry  officer,  no  evidence  recorded   and   no         conclusion arrived at in the inquiry." The  underlined  words  are   very   important   and demarcate  the  line  of distinction. If the inquiry officer held no sittings, did  not  take  evidence  nor  record  any conclusions and if at that stage the inquiry was dropped and a  simple  order  of termination was, passed, the same would not be punitive. In Nepali Singh vs. State of U.P. (1988 (3) SCC 370)

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a three Judge Bench held the order to be punitive as it  was passed  after  issuing a charge memo, a reply received, even though no evidence was adduced and no findings  were  given. But  in a latter three Judge Bench case in State of U.P. vs. Kaushal Kishore Shukla, [1991 (1) SCC 691],  Nepali  Singh’s case  was  not  followed  as  being  a judgment rendered per incuriam as it did not consider Champak Lal’s case (AIR 1964 SC 1854). Of course, the above case,  i.e.  Kaushal  Kishore Shukla’s  case  was one where there was an adverse entry and only a  preliminary  report  and  then  a  simple  order  of termination was issued. That order was upheld. Similarly, in Commission  of Food & Civil Supply vs. P.C. Saxena [1994 (5) SCC 177]. the facts were that the departmental  inquiry  was started  and dropped and this Court held the order not to be punitive. It will be noticed from the above decisions that the termination of the services of a temporary servant or one on probation,  on  the basis of adverse entries or on the basis of an assessment that his work is not satisfactory will  not be  punitive  inasmuch  as  the  above  facts are merely the motive and not the foundation.  The reason why they are  the motive is that the assessment is not done with the object of finding  out  any  misconduct on the part of the Officer, as stated by Shah, J.  (as he then was) in  Ram  Narayan  Das’s case.   It  is done only with a view to decide whether he is to be retained or continued in service.  The position is not different even if a preliminary inquiry is held because  the purpose  of a preliminary inquiry is to find out if there is prima facie evidence  or  material  to  initiate  a  regular departmental inquiry.      It   has   been   so  decided  in Champaklal’s case.  The purpose of the  preliminary  inquiry is not to find out misconduct on the part of the Officer and if  a  termination follows without giving an opportunity, it will not  be  bad.    Even  in  a  case  where   a   regular departmental inquiry is started, a charge memo issued, reply obtained,  and  an enquiry Officer is appointed - if at that point of time, the inquiry is dropped and a simple notice of termination is  passed,  thee  same  will  not  be  punitive because  the  enquiry  Officer has not recorded evidence nor given any findings on the charges.  That is what is held  in Sukh Raj  Bahadur’s  case  and  in  Benjamin’s case.  In the latter case, the departmental inquiry  was  stopped  because the  employer  was not sure of establishing the quilt of the employee.  In all these cases the  allegations  against  the employee merely raised a cloud on his conduct and as pointed by Krishna  Iyer,  J.    in  Gujrat  Steel  Tubes  case, the employer was entitled to say that he would not  continue  an employee  against  whom  allegations  were made the truth of which the employer was not  interested  to  ascertain.    In fact,  the  employer,  by  opting  to pass a simple order of termination as permitted by the terms of appointment  or  as permitted  by  the  rules  was  conferring  a benefit on the employee by passing a simple order of  termination  so  that the  employee  would  not suffer from any stigma which would attach to the rest of his career if  a  dismissal  or  other punitive order was passed.  The above are all examples where the  allegations  whose  truth  has not been found, and were merely the motive. But in cases where the termination is preceded by an inquiry  and  evidence  is  received  and  findings  as   to misconduct  of a definitive nature are arrived at behind the back of the Officer and where on the basis of such a report, the termination order is  issued,  such  an  order  will  be violative  of  principles of natural justice inasmuch as the purpose of the inquiry is to  find  out  the  truth  of  the

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allegations  with  a  view  to  punish him and not merely to gather evidence for a future regular  departmental  inquiry. In  such cases, the termination is to be treated as based or founded upon misconduct and will be  punitive.    These  are obviously not cases where the employer feels that there is a mere cloud against the employees conduct but are cases where the employer has virtually accepted the definitive and clear findings  of  the  Inquiry Officer, which are all arrived at behind  the  back  of  the  employee  -  even  though   such acceptance  of  findings  is  not  recorded  in the order of termination.  That is why the misconduct is  the  foundation and not merely the motive, in such cases. Coming now to the facts of the case before  us,  the inquiry  officer,  Sri  R.P. Singh examined witnesses and in his report dated 22.1.76 has said: "I conclude that Sri R.P. Gupta took a sum of Rs.2000/-  from  Sri  Jai  Chandra  Lal, thereafter referring to certain facts said they ’go to prove the  correctness  of  the  complaint".  Not  only  that,  he concluded "I therefore suggest that  service  of  Shri  R.S. Gupta may be terminated and one month salary may be given to him  in lied of the notice". The very next day, the impugned simple order of termination followed. In our view, it is an absolutely  clear  case  where the  inquiry  officer  examined  witnesses,  recorded  their statements  and  gave  a  clear  finding  of  the  appellant accepting a bribe and even recommended his termination.  All these were  done  behind  the  back  of  the appellant.  The Managing Director passed the termination order the very next day.  It cannot in the above circumstances be stated, by any stretch of inspection  that  the  report  is  a  preliminary inquiry report.   It’s findings are definitive.  It is not a preliminary report where  some  facts  are  gathered  and  a recommendation  is  made for a regular departmental inquiry. In view of the principles laid down in the cases referred to above, this case is an obvious case where the report and its findings are the foundation of the termination order and not merely the motive. The Tribunal was right in its conclusion. The High Court was in grave error in treating such a  report as a preliminary report. For  all  the  above  reasons, we set aside the High Court’s Judgment and restore  the  Tribunal’s  order.  There will be no order as to costs.