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S.V. Kadanagoudar Vs. the Managing Director, Karnataka State Seeds Corporation, Bangalore and anr. - Court Judgment

LegalCrystal Citation
SubjectLabour and Industrial
CourtKarnataka High Court
Decided On
Case NumberWrit Appeal No. 5535 of 1998
Judge
Reported in[2002(93)FLR1043]; ILR2002KAR2337; 2002(3)KarLJ65
ActsIndustrial Disputes Act, 1947 - Sections 25F; Karnataka State Seeds Corporation Limited Service Rules, 1980 - Rules 6 and 7; Constitution of India - Article 226
AppellantS.V. Kadanagoudar
RespondentThe Managing Director, Karnataka State Seeds Corporation, Bangalore and anr.
Appellant AdvocateM.V. Hiremath, Adv.
Respondent AdvocateB.C. Prabhakar, Adv.
Excerpt:
.....by the respondent-bank to show that the work of the appellant was not satisfactory and that his services were terminated for that reason, the authority as well as the labour court were justified in recording a finding that there was no reasonable cause for terminating the services of the appellant. in samsher singh's case, supra, the form of the order is not decisive as to whether the order is by way of punishment and that even an innocuously worded order terminating the service may in the fact and circumstances of the case establish that an enquiry into allegations of serious and grave character of misconduct involving stigma has been made in infraction of the provision of article 311(2). para 12.-it is, therefore, now well-settled that where the form of the order is merely a..........in which case even the services of a permanent employee could be terminated. at the endof the six months period the employer can either confirm him or terminate his services, because his service is found unsatisfactory. if no action is taken by the employer either by way of confirmation or by way of termination, the employee continues to be in service as a probationer. the high court was therefore right in rejecting the management's contention that there was an automatic termination of mr. bobb's services after august 28, 1957. mr. gupte also tried to persuade us to examine the correctness of the high court's view that the labour court's finding on the question of victimisation was not liable to interference. it appears to us clear that when the labour court came to the conclusion on a.....
Judgment:

Kumar Rajaratnam, J.

1. The appellant was appointed as a Second Division Clerk by the 1st respondent-Corporation on a temporary basis for four months, on 7-8-1990, on a consolidated salary of Rs. 800/- + Rs. 60/- as medical allowance. In the order it was stated that the appellant is liable to be terminated at any time without assigning any reason. The appellant's temporary appointment was extended from time to time, but ultimately by an office order dated 31-1-1998 the respondent 1 terminated the service of the appellant in terms of Clause 3 of the Karnataka State Seeds Corporation Limited Service Rules, 1980 (hereinafter referred to as the 'Rules').

2. The grievance of the appellant was that he was appointed on a temporary basis on 7-8-1990 and continued in service till he was terminated from service on 31-1-1998 and was not regularised. The appellant challenged his termination before the learned Single Judge.

3. The learned Single Judge relied on Rule 6(c) of the Service Rules of the first respondent-Corporation. Rule 6(c) empowers the Managing Director to make temporary appointments for a period of six months subject to extension. Rule 6(c) reads as follows:

'Rule 6(c).--Notwithstanding anything contained in Rule 6 the Managing Director shall be entitled to make appointment on temporary/contract basis to any post, the maximum basic pay of which in timescale does not exceed Rs. 1,300/- per month for a period of 6 months and also to extend the term of such appointment for a further period not exceeding 6 months on each occasion'.

4. Learned Single Judge also referred to Rule 7(b) which reads as follows.-

'Rule 7(b).--An employee who has served in the Corporation in a temporary capacity for a period not less than five years in any post continuously may be considered for appointment in that post on permanent basis, provided the creation of the post is found essential for the Corporation and approved by the Board'.

5. The learned Single Judge felt that the employer did not consider the case of the appellant because Rule 7(b) was only an enabling provision and does not create any right in the person who has worked on a temporary basis for a period of five years or more. The learned Single Judge also held that it is the authority given to the Corporation which has to be exercised by taking note of the totality of the performance of the employee. The learned Single Judge relied on a judgment of the Supreme Court in Madhya Pradesh Hasta Shilpa Vikas Nigam Limited v. Devendra Kumar Jain and Ors., : (1995)1SCC638 , and ultimately declined to grant any relief to the appellant. In this case, curiously, the management respondent filed an 'additional objections statement' stating that the appellant was appointed on a temporary basis and he was ultimately terminated on the ground that there was certain alleged misconduct. In the additional objections statement, the following acts of misconduct are referred to.-

(i) Absenteeism on 4-4-1992.

(ii) Absenteeism from 17-8-1992 to 28-9-1992.

(iii) Negligence of duty by closing the sale point without permission.

(iv) Shortage of seeds.

6. The learned Counsel for the appellant submitted that the alleged misconduct referred to in the additional objections statement was with respect to alleged misconduct in the year 1992 and the appellant was terminated from service in the year 1998. In other words, six years after the alleged misconduct, the appellant was sought to be terminated from service without any enquiry.

7. It was further submitted on behalf of the appellant that one Leelavathi who was appointed on a temporary basis and who was junior to the appellant has been regularised in service.

8. So far as the temporary appointments as Second Division Clerks is concerned, their seniority is as follows.-

Sl. No.

Name ofemployee

Designation

Date ofwork on temporary basis

Placeof work

1.

M.Booramano

SDC

5-10-1987

Dharwar

2.

J.L.Naik

SDC

9-6-1988

Sirsi

3.

Lakshmi

SDC

5-9-1988

HeadOffice

4.

Kantharaju

SDC

12-12-1998

Bellary

5.

E.B.Thammaniyappa

SDC

13-8-1990

Shimoga

6.

S.V.Kadanagowdar

SDC

13-8-1990

Naragund

7.

N.Leelavathi

SDC

29-8-1990

HeadOffice

9. The appellant is at serial No. 6. Leelavathi is at serial No. 7. It is further submitted that as per Rule 7(b), an employee who has served in the Corporation in a temporary capacity for a period not less than five years in the post continuously, may be considered for appointment in that post on a permanent basis provided, the creation of that post is essential for the Corporation and approved by the Board. It was submitted that, as per Rule 7(b), the appellant's case for regularisation was not considered in accordance with law. It is necessary in these circumstances to refer to the pronouncements of the Supreme Court on this aspect. In Management of the Express Newspapers (Private) Limited, Madurai v. The Presiding Officer, Labour Court, Madurai and Anr., : AIR1964SC806 , the Supreme Court pronounced as follows.-

'Para (12) The main contention urged by Mr. Gupte in support of the appeal is that the High Court was wrong in law in thinking that once the period of six months expired, Mr. Bobb still continued to be in service of the appellant as a probationer. According to the learned Counsel there would be automatic termination of service as soon as the period of probation of six months had expired unless an order of confirmation was made. This contention is, in our opinion, wholly unsound. There can, in our opinion, be no doubt about the position in law that an employee appointed on probation for six months continues as a probationer even after the period of six months if at the end of the period his services had either not been terminated or he is confirmed. It appears clear to us that without anything more an appointment on probation for six months gives the employer no right to terminate the service of an employee before six months had expired except on the ground of misconduct or other sufficient reasons in which case even the services of a permanent employee could be terminated. At the endof the six months period the employer can either confirm him or terminate his services, because his service is found unsatisfactory. If no action is taken by the employer either by way of confirmation or by way of termination, the employee continues to be in service as a probationer. The High Court was therefore right in rejecting the Management's contention that there was an automatic termination of Mr. Bobb's services after August 28, 1957. Mr. Gupte also tried to persuade us to examine the correctness of the High Court's view that the Labour Court's finding on the question of victimisation was not liable to interference. It appears to us clear that when the Labour Court came to the conclusion on a consideration of the evidence that the Management's action was not bona fide but amounted to victimisation of the employee it would not have been open to the High Court to disturb the finding except on the ground of an error apparent on the face of the record or on the ground that there was no evidence at all to support it. The High Court has not only found no such error but has gone further and indicated its support of that finding. It is not open to the Management to challenge the High Court's conclusion on this point'.

10. In Syed Azam Hussaini v. Andhra Bank Limited, : (1995)IILLJ126SC the facts of the case set out at para (2) reads as follows.-

'(2) The appellant was appointed in the clerical grade of the respondent-Bank by order dated March 21, 1970. The said appointment was on probation for a period of six months which could be extended by the respondent-Bank at its discretion. In the letter of appointment it was stated that during the probation period, the appellant's services were liable to be terminated without assigning any reason whatsoever by one month's notice or on payment of a month's pay and allowances in lieu of notice. In pursuance of the said letter of appointment the appellant joined duty on April 16, 1970. The period of probation which was to expire on October 6, 1970 was extended for a further period of three months. Before the expiry of the extended probation period the services of the appellant were terminated by order dated January 2, 1971 which reads as under:

This is to inform Mr. Syed Azam Hussaini, probationer in clerical grade at Khairatabad (Hyderabad Branch) that his services are hereby terminated with effect from the close of business hours today.

He will be paid one month's salary and allowances in lieu of notice''.

11. The Supreme Court after relying on other judgments came to the conclusion that the termination of the probationer was not bona fide and there was no reasonable cause for terminating the services of the appel-lant and accordingly, the Supreme Court set aside the termination. The Supreme Court dealt with this aspect of the matter at paras (12) and (13) which is as under.-

'(12) In the present case we find that Section 40 of the Act entitles a workman to assail the legality of the termination of his services if it is made without any reasonable cause. The order dated January 2, 1971 did not contain any reason for termination of the services of the appellant. Before the authority the appellant assailed the legality of the termination of his services on the ground that the said termination was without any reasonable cause and that it was done with a view to victimise him for having joined the union. The case of the respondent-Bank before the authority was that the services of the appellant were terminated for the reason that he was on probation and his work was not satisfactory. This was disputed by the appellant who asserted that during the period of his service nobody pointed out any defect in his work and that he did not receive any memo and further that he was ready and willing to do to the best of his abilities. The authority has observed that these averments made by the appellant were not denied by the respondent-Bank. Moreover, the respondent-Bank did not produce any material to show that the performance of the appellant was not satisfactory. In the absence of any material having been placed by the respondent-Bank to show that the work of the appellant was not satisfactory and that his services were terminated for that reason, the authority as well as the Labour Court were justified in recording a finding that there was no reasonable cause for terminating the services of the appellant. The said finding has not been upset by the High Court. The learned Judges of the Division Bench of the High Court were, therefore, not right in upholding the legality of the termination of the services of the appellant.

(13) There is one more hurdle in the path of the respondent-bank. It cannot be disputed that the appellant had completed 240 days of service since he had joined duty on April 6, 1970 and his services were terminated on January 2, 1971. The appellant was a 'workman' for the purpose of Section 2(s) of the Industrial Disputes Act, 1947 since he was employed in the clerical grade with the respondent-bank which is an 'industry' under Section 2(j) of the Industrial Disputes Act, 1947. The termination of appellant's service was, therefore, retrenchment under Section 2(oo) of the Industrial Disputes Act, 1947 and it could be done only in accordance with the provisions contained in Section 25-F of the Industrial Disputes Act, 1947. In Krishna District Co-operative Marketing Society Limited, Vijayawada v. N.V. Purnachandra Rao and Ors., : (1987)IILLJ365SC this Court has construed the provisions of Chapter V-A of the Industrial Disputes Act, 1947 and Sections 40 and 41 of the Act and has held that if the employees are 'workmen' and themanagement is an 'industry' as defined in the Industrial Disputes Act and the action taken by the management amounts to 'retrenchment' then the rights and liabilities of the parties are governed by the provisions of Chapter V-A of the Industrial Disputes Act and the said rights and liabilities may be adjudicated upon and enforced in proceedings before the authorities under Sub-sections (1) and (3) of Section 41 of the Act. In that case proceedings had been initiated in the form of appeal filed under Section 41 of the Act before the authority and it was held that since the orders for termination of services of the employee amounted to retrenchment and had been passed without complying with Section 25-F of the Industrial Disputes Act, the order of the authority setting aside the said orders of termination could be affirmed in view of Sections 25-F of the Industrial Disputes Act. This Court further held that it is open to the authority under Section 41 of the Act to determine whether Sections 25-F and 25-G of the Industrial Disputes Act were complied with or not and to set aside the orders of termination and to grant appropriate relief if it is found that there was non-compliance with Sections 25-F and 25-G of the Industrial Disputes Act. Applying the said decision to the facts of the present case it can be said that since the appellant was a workman and the respondent-Bank is an industry under the Industrial Disputes Act the action taken by the respondent-Bank in terminating the services of the appellant amounts to 'retrenchment' and since the appellant had worked continuously for more than 240 days such retrenchment could be done only in accordance with provisions of Section 25-F of the Industrial Disputes Act, 1947. The said provisions were admittedly not complied with because one month's wages in lieu of notice were not paid at the time of such retrenchment on January 2, 1971 and were paid subsequently on January 5, 1971. The termination of the services of the appellant cannot, therefore, be upheld as legal and valid'.

12. The Supreme Court in the case of Anoop Jaiswal v. Government of India and Anr., : (1984)ILLJ337SC held that where an order is merely a camouflage for an order of dismissal for misconduct it is always open to the Court to go behind the order and to determine the true character of the order. The Supreme Court, in Anoop Jaiswal's case, supra, held as follows.-

'Para 11.--On behalf of the Union of India reliance has been placed on State of Punjab and Anr. v. Sukh Raj Bahadur, : (1970)ILLJ373SC ; Union of India and Ors. v. R.S. Dhaba, : [1971]19ITR143(SC) ; State of Bihar and Ors. v. Shiva Bhikshuk Mishra, : (1970)IILLJ440SC ; R.S. Sial v. State of Uttar Pradesh and Ors., : (1974)ILLJ513SC : State of Uttar Pradesh v. Ram ChandraTrivedi, : (1977)ILLJ200SC and I.N. Saksena v. State of Madhya Pradesh, : (1976)IILLJ154SC . We have gone through these decisions. Except the case of Ram Chandra Trivedi, supra, all other cases referred to above were decided prior to the decision in Samsher Singh v. State of Punjab and Anr., : (1974)IILLJ465SC which is a judgment delivered by a Bench of seven Judges. As pointed out by us in all these cases including the case of flam Chandra Trivedi, supra, the principle applied is the one enunciated by Parshotam Lal Dhingra v. Union of India, : (1958)ILLJ544SC which we have referred to earlier. It is urged relying upon the observation in Sukh Raj Bahadur's case, supra, that it is only when there is a full scale departmental enquiry envisaged by Article 311(2) of the Constitution i.e., an Enquiry Officer is appointed, a chargesheet submitted, explanation called for and considered, any termination made thereafter will attract the operation of Article 311(2). It is significant that in the very same decision it is stated that the circumstances preceding or attendant on the order of termination of service have to be examined in each case, the motive behind it being immaterial. As observed by Ray, C.J. in Samsher Singh's case, supra, the form of the order is not decisive as to whether the order is by way of punishment and that even an innocuously worded order terminating the service may in the fact and circumstances of the case establish that an enquiry into allegations of serious and grave character of misconduct involving stigma has been made in infraction of the provision of Article 311(2).

Para 12.--It is, therefore, now well-settled that where the form of the order is merely a camouflage for an order of dismissal for misconduct it is always open to the Court before which the order is challenged to go behind the form and ascertain the true character of the order. If the Court holds that the order though in the form is merely a determination of employment is in reality a cloak for an order of punishment, the Court would not be debarred, merely because of the form of the order, in giving effect to the rights conferred by law upon the employee.

Para 13.--In the instant case, the period of probation had not yet been over. The impugned order of discharge was passed in the middle of the probationary period. An explanation was called for from the appellant regarding the alleged act of indiscipline, namely, arriving late at the gymnasium and acting as one of the ringleaders on the occasion and his explanation was obtained. Similar explanations were called for from other probationers and enquiries were made behind the back of the appellant. Only the case of the appellant was dealt with severally in the end. The cases of other probationers who were also considered to be ring-leaders were not seriously taken note of. Even though the order of discharge may be non-committal, it cannot stand alone. Though the noting in the file of the Government may be irrelevant, the cause for the order cannot be ignored. The recommendation of the Director which is the basis of foundation for the order should be read along with the order for the purpose of determining its true character. If on reading the two together the Court reaches the conclusion that the alleged act of misconduct was the cause of the order and that but for that incident it would not have been passed then it is inevitable that the order of discharge should fall to the ground as the appellant has not been afforded a reasonable opportunity to defend himself as provided in Article 311(2) of the Constitution'.

The Supreme Court took a similar view in a judgment in Dipti Prakash Banerjee v. Satvendra Nath Base National Centre for Basic Sciences, Calcutta, : [1999]1SCR532 .

13. The Supreme Court in Chandra Prakash Shahi v. State of Uttar Pradesh, : AIR2000SC1816 held that 'motive' is the moving power which impels action for a definite result, or to put it differently, 'motive' is that which incites or stimulates a person to do an act. An order terminating the services of an employee is an act done by the employer. What is that factor which impelled the employer to take this action? If it was the factor of general unsuitability of the employee for the post held by him, the action would be upheld in law. If however, there were allegations of serious misconduct against the employee and a preliminary enquiry is held behind his back to ascertain the truth of those allegations and a termination order is passed thereafter, the order, having regard to other circumstances, would be founded on the allegations, of misconduct which were found to be true in the preliminary enquiry.

14. The Supreme Court in V.P. Ahuja v. State of Punjab, : (2000)ILLJ1099SC held that a probationer or a temporary servant, is also entitled to certain protection and his services cannot be terminated arbitrarily, nor can those services be terminated in a punitive manner without complying with the principles of natural justice.

15. From all the materials on record, it appears that the appellant was terminated from service for alleged misconduct in the year 1992 and the termination was made in the year 1998, after a lapse of six years. For all these reasons, we have no hesitation in holding that the termination of the appellant for the reasons mentioned in the additional objections statement is punitive in nature. Accordingly, the order of the learned Single Judge is set aside. The appellant would be entitled for reinstatement on regular basis with continuity of service, but without back wages. The time granted for implementation of this order by the respondent is two months from the date of receipt of a copy of this order.


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