{"id":157817,"date":"1997-10-14T00:00:00","date_gmt":"1997-10-13T18:30:00","guid":{"rendered":"https:\/\/www.legalindia.com\/judgments\/life-insurance-corporation-of-vs-shri-raghavendra-seshagiri-rao-on-14-october-1997"},"modified":"2017-02-17T11:24:47","modified_gmt":"2017-02-17T05:54:47","slug":"life-insurance-corporation-of-vs-shri-raghavendra-seshagiri-rao-on-14-october-1997","status":"publish","type":"post","link":"https:\/\/www.legalindia.com\/judgments\/life-insurance-corporation-of-vs-shri-raghavendra-seshagiri-rao-on-14-october-1997","title":{"rendered":"Life Insurance Corporation Of &#8230; vs Shri Raghavendra Seshagiri Rao &#8230; on 14 October, 1997"},"content":{"rendered":"<div class=\"docsource_main\">Supreme Court of India<\/div>\n<div class=\"doc_title\">Life Insurance Corporation Of &#8230; vs Shri Raghavendra Seshagiri Rao &#8230; on 14 October, 1997<\/div>\n<div class=\"doc_bench\">Bench: M.K. Mukherjee, K.T. Thomas<\/div>\n<pre>           PETITIONER:\nLIFE INSURANCE CORPORATION OF INDIA &amp; ANR.\n\n\tVs.\n\nRESPONDENT:\nSHRI RAGHAVENDRA SESHAGIRI RAO KULKARNI\n\nDATE OF JUDGMENT:\t14\/10\/1997\n\nBENCH:\nM.K. MUKHERJEE, K.T. THOMAS\n\n\n\n\nACT:\n\n\n\nHEADNOTE:\n\n\n\nJUDGMENT:\n<\/pre>\n<p>\t      THE 23RD DAY OF SEPTEMBER, 1997<br \/>\nPresent:\n<\/p>\n<p>\t       Hon&#8217;ble Mr. Justice S. Saghir Ahmad<br \/>\n\t       Hon&#8217;ble Mr. Justice D.P. Wadwa<br \/>\nHarish N. Salve, Sr. Adv., C.K. Sasi, K.K. Sharma,<br \/>\nKailash Vasdev, Advs. with him for the appellants<br \/>\nS.S. Javali,  Sr. Adv.,\t R.Jaganath Goulay,  M.K. Dua, Advs.<br \/>\nwith him for the Respondent<br \/>\n\t\t\t O R D E R<br \/>\n     The following Order of the Court was delivered:<br \/>\n\t\t\t O R D E R<br \/>\n     Respondent\t was   appointed  as  Assistant\t Development<br \/>\nOfficer or  4th September,  1985.  After  completion  of  he<br \/>\nperiod of  Apprenticeship, he  was placed  on  probation  as<br \/>\nDevelopment officer  with effect  from\t4th  December  1985.<br \/>\nWhile  he   was\t still\ta  probationer.\t his  services\twere<br \/>\nterminated by  order dated 22.5.1986 which was challenged in<br \/>\na writ petition before the High Court of Karnataka.\n<\/p>\n<p>     Relying upon  the decision\t of this  Court\t in  Central<br \/>\nInland water  transport corporation  Ltd. &amp;  Anr. Vs.  Brojo<br \/>\nNath Ganguly  &amp; Anr. etc. (1986) 3 SCC 156, a learned single<br \/>\njudge of  the High Court by judgment dated 12.8.1986 allowed<br \/>\nthe writ  petition and quashed the order of termination. The<br \/>\njudgment was  upheld by\t the Division  Bench in appeal. Now,<br \/>\nthe matter is in this Court.\n<\/p>\n<p>     We have heard learned counsel for the parties.<br \/>\n     Reliance placed  by the  High Court  on the decision of<br \/>\nthis Court  in Central\tInland Water  Transport\t Corporation<br \/>\nLtd. (Supra) was wholly out o place as that decision related<br \/>\nto a  permanent employee  whose services could be terminated<br \/>\nat any\ttime by giving three months&#8217; notice. This Court held<br \/>\nthat such  a provision\tfor terminating\t the services  of  a<br \/>\npermanent  employee   was  wholly  arbitrary  and  that\t the<br \/>\nservices of  the permanent  employee could not be terminated<br \/>\nexcept by  giving him  an opportunity  of hearing.  The High<br \/>\nCourt was of the view, and in our opinion, wrongly, that the<br \/>\ncase of\t the probationer  was not different from that of the<br \/>\npermanent employee and, therefore, applied the law laid down<br \/>\nby this\t Court in Central Inland Water Transport Corporation<br \/>\nLtd.&#8217;s case  (supra) to the case of the respondent who was a<br \/>\nmere probationer,  and held  that the  termination order was<br \/>\nbad.\n<\/p>\n<p>     Clause  2\tof  the\t Letter\t of  Appointment  issued  to<br \/>\nrespondent reads as under:\n<\/p>\n<blockquote><p>     &#8220;You  shall   be\t  on   probation<br \/>\n     initially for  a period  of  twelve<br \/>\n     months  from   the\t date\tof  your<br \/>\n     joining duties  as\t a  probationer,<br \/>\n     but the  extend  your  probationary<br \/>\n     period  provided\tthat  the  total<br \/>\n     probationary period  including  the<br \/>\n     extended period shall not exceed 24<br \/>\n     months\tcounted\t    from     the<br \/>\n     commencement  of  the  probationary<br \/>\n     appointment.\tDuring\t     the<br \/>\n     probationary  appointment.\t  During<br \/>\n     the  probationary\t period\t  (which<br \/>\n     includes\textended    probationary<br \/>\n     period ,  if applicable)  you shall<br \/>\n     be liable to discharge from service<br \/>\n     of\t the   corporation  without  any<br \/>\n     notice and\t without any cause being<br \/>\n     assigned.&#8221;<\/p><\/blockquote>\n<p>     This Clause  clearly  stipulates  that  the  respondent<br \/>\ncould be  discharged from  service at  any time\t during\t the<br \/>\nperiod of probation or extended period of probation, without<br \/>\nany notice or without assigning any cause.\n<\/p>\n<p>     The period\t of probation  is a  period of\ttest  during<br \/>\nwhich  the   work  and\tconduct\t of  an\t employee  is  under<br \/>\nscrutiny.. If  on an  assessment of  his  work\tand  conduct<br \/>\nduring this  period it is found that he was not suitable for<br \/>\nthe post  it would  be open to the employer to terminate his<br \/>\nservices. His  services can  not be  equated with  that of a<br \/>\npermanent  employee  who,  on  account\tof  his\t status,  is<br \/>\nentitled to  be retained  in service and his services cannot<br \/>\nbe terminated  abruptly\t without  any  notice  or  plausible<br \/>\ncause. This  is based  on the  principle that  a substantive<br \/>\nappointment to\ta permanent post in a public service confers<br \/>\nsubstantive right  to the  post and  the person appointed on<br \/>\nthat post  becomes entitled  to hold  a lien on the post. He<br \/>\ngets the  right to  continue on the post till he attains the<br \/>\nage of\tsuperannuation\tor  is\tdismissed  or  removed\tfrom<br \/>\nservice for  misconduct etc.  after disciplinary proceedings<br \/>\nin accordance with the Rules at which he is given a fair and<br \/>\nreasonable opportunity\tof being  heard. He may also come to<br \/>\nlose the post on compulsory retirement.\n<\/p>\n<p>     In Moti  Ram Deka\tetc.  vs.  General  Manager,  N.E.F.<br \/>\nRailways, Maligaon, Pandu, etc. 1964 (5) SCR 683, a majority<br \/>\nof  seven   judges  held   that\t a  permanent  employee\t who<br \/>\nsubstantively holds a permanent post has a right to hold the<br \/>\npost till he reaches the age of superannuation or till he is<br \/>\ncompulsorily retired under the relevant Rule. Termination of<br \/>\nhis service  in any other manner would amount to invasion of<br \/>\nhis right  to hold  the post  and would amount to penalty of<br \/>\nremoval. It was for this reason that the Court held Rule 148<br \/>\n(3) or\tRule 149(3)  of the Railway Establishment code to be<br \/>\nviolative of  the right\t guaranteed under  Article 311(2) of<br \/>\nthe  constitution.   It\t was   observed\t that\ta  permanent<br \/>\nemployment assures security of tenure which is essential for<br \/>\nthe    efficiency    and    incorruptibility\tof    public<br \/>\nadministration.\n<\/p>\n<p>     Similar view  was expressed  in <a href=\"\/doc\/405303\/\">Gurdev  Singh Sidhu vs.<br \/>\nState of Punjab &amp; Anr.<\/a> 1964 (7) SCR 587 = AIR 1964 SC 1585.\n<\/p>\n<p>     Central  Inland  water  Transport\tCorporation  Ltd.  &amp;<br \/>\nAnr.&#8217;s case  was not  correctly\t understood  either  by\t the<br \/>\nsingle juice or by the Division Bench of the High Court. The<br \/>\nHigh court  also did  not notice  that\tapart  from  Central<br \/>\nInland water Transport corporation Ltd. &amp; Anr.&#8217;s case, there<br \/>\nware other  judgments of  this Court in which a similar view<br \/>\nwas expressed.\n<\/p>\n<p>     In West  Bengal State Electricity Board &amp; Ors. Vs. D.B.<br \/>\nGhosh &amp;\t Ors. 1985  (2) SCR 1014= AIR 1985 SC 722, a similar<br \/>\nprovision which\t enabled the  Broad  to\t dispense  with\t the<br \/>\nservices of  a permanent employee by a mere notice or pay in<br \/>\nlieu thereof  was held\tto be  bad. it\twas  held  that\t the<br \/>\noffending Regulation  which had developed the notoriety as &#8221;<br \/>\nHenry VIII Clause&#8221; was ultra <a href=\"\/doc\/1845722\/\">Hindustan Steel Ltd. &amp; Anr. vs.<br \/>\nHindustan Steel\t Ltd. &amp;\t Ors.<\/a> 1985 (2) SCR 428 = AIR 1985 SC<br \/>\n251 as\talso in <a href=\"\/doc\/1068549\/\">O.P. Bhandari vs. Indian Tourist Development<br \/>\nCorporation<\/a> (1984) 4 SCC 337, the Rule based on the doctrine<br \/>\nof hire\t and fire&#8221; was held to be bad as being impermissible<br \/>\nunder the constitutional scheme to sustain the doctrine as a<br \/>\npermanent employee could not be removed in that fashion.\n<\/p>\n<p>     This question  was re-examined  and the entire case law<br \/>\nwas reviewed  by this  Court in\t <a href=\"\/doc\/268805\/\">Delhi Transport Corporation<br \/>\nvs. D.T.C  Mazdoor Congress and others AIR<\/a> 1991 SC 101= 1990<br \/>\nSupp. (1)  SCR 142  = (1991)  SCC Supp.\t (1) 600  and it was<br \/>\nagain reiterated by the majority of judges that a Rule which<br \/>\ngave unbridled\tor arbitrary  powers to\t the  management  to<br \/>\ndispense  with\t the  services\t of  regular  and  permanent<br \/>\nemployees by a mere notice or, pay in lieu thereof, would be<br \/>\nbad. The  principles laid down in the case of central Inland<br \/>\nWater Transport Corporation Ltd. &amp; Anr. were reiterated.\n<\/p>\n<p>     The requirement  to hold a regular departmental enquiry<br \/>\nbefore dispensing  with the  services  dispensing  with\t the<br \/>\nservices of a probationer cannot be invoked in the case of a<br \/>\nprobationer specially when his services are terminated by an<br \/>\ninnoduous order\t which does  not case any stigma on him. But<br \/>\nit cannot be laid down as a general rule that in no case can<br \/>\nan enquiry be held. If the termination is punitive in nature<br \/>\nand is brought about on the ground of misconduct.\n<\/p>\n<p>     Article 311(2) would be attracted and in that situation<br \/>\nit would  be incumbent\tupon the  employer, in\tthe case  of<br \/>\nGovernment service,  to hold a regular departmental enquiry.<br \/>\nIn  any\t  other\t case  also,  specially\t those\trelating  to<br \/>\nstatutory corporations\tor Government  instrumentalities,  a<br \/>\ntermination which  is punitive\tin nature  cannot be brought<br \/>\nabout unless  an opportunity  of hearing  is  given  to\t the<br \/>\nperson whose  services, even during the period of probation,<br \/>\nor extended  period, are  sought  to  be  terminated.  (See:<br \/>\n<a href=\"\/doc\/1270113\/\">Parshotam Lal  Dhingra vs. Union of India<\/a>  (1958) SCR 328 in<br \/>\nwhich it  was held  that appointment  to a permanent post on<br \/>\nprobation means\t that the servant is taken on trial, such an<br \/>\nappointment comes  to an  end if during or at the end of the<br \/>\nprobation, the person so appointed is found to be unsuitable<br \/>\nand his services are terminated by notice. An appointment on<br \/>\nprobation or  on an  officiating basis\tis of  a  transitory<br \/>\ncharacter with an implied condition that such an appointment<br \/>\nis terminable  at any  time: see also: Shamsher Singh &amp; Anr.<br \/>\nvs. State of Punjab 19756 (1) SCR 814 = (1974) 2 SCC 831).\n<\/p>\n<p>     To bring  home the\t point, we  may refer to a few other<br \/>\ncases  relating\t  to  the   termination\t of   service  of  a<br \/>\nprobationer. They  are: <a href=\"\/doc\/443992\/\">State of Maharashtra vs. Veerappa R.<br \/>\nSaboji &amp; Another Air<\/a> 1980 SC 42 = 1980 (1) SCR 551= (1979) 4<br \/>\nSCC 466.  In the  same volume, another case, namely, oil and<br \/>\nNatural Gas  commission and  others vs.\t Dr. Md. s. Iskander<br \/>\nAli AIR 1980 SC 1242= 1980 (3) SCR 603 = (1980) 3 SCC 428 is<br \/>\nreported in which the same principles have been reitereated.<br \/>\n<a href=\"\/doc\/1620595\/\">In The\tUnion of India and others vs. P.S. Bhatt AIR<\/a> 1981 SC<br \/>\n957 =  (1981) 2\t SCC 761 promotion was made to a higher post<br \/>\non probation  which was\t ultimately terminated.\t It was held<br \/>\nthat a\tperson who  is placed on probation does not have the<br \/>\nright to  hold the  post and  if it is found that he was not<br \/>\nsuitable for  the post,\t his probation\tcan be terminated at<br \/>\nany time and he can be reverted to his original post.\n<\/p>\n<p>     A distinction  was drawn  again as\t between a permanent<br \/>\nemployee and  an employee  appointed on\t probation in <a href=\"\/doc\/941260\/\">Bishan<br \/>\nLal Gupta  vs. The  State of  Haryana and others AIR<\/a> 1978 SC<br \/>\n363= 1978  (20 SCR  513= (1978)\t 1 SCC\t202. In this case, a<br \/>\nformal enquiry\twas held  merely  to  assess  the  work\t and<br \/>\nconduct of  an employee\t who was  appointed on probation. It<br \/>\nwas held  that there was no need either to give notice or to<br \/>\nhold the regular departmental enquiry.\n<\/p>\n<p>     In the instant case, the respondent was discharged from<br \/>\nservice during probation in terms of Regulation 14(4) of the<br \/>\nLife Insurance Corporation of India (Staff) Regulation 1960.<br \/>\nSuch termination  has already been upheld been a Three judge<br \/>\nBench of  this Court in <a href=\"\/doc\/1717149\/\">M. Venugopal vs. Divisional Manager.<br \/>\nLife Insurance\tCorporation of\tIndia, Machilipatnam, A.P. &amp;<br \/>\nAnr.<\/a> (1994)  2 SCC  323. This decision also meets the ground<br \/>\nraised\tby   the  counsel   for\t the   respondent  that\t the<br \/>\ntermination of\trespondent&#8217;s  services\twould  amount  to  &#8221;<br \/>\nRETRENCHMENT&#8221;  as   defined  in\t Section  on  2(00)  of\t the<br \/>\nIndustrial  disputes  Act  and\tsince  the  requirements  of<br \/>\nsection\t 25-F  of  the\tAct  were  not\tcomplied  with,\t the<br \/>\ntermination would  be bad.  It may  be pointed out that Life<br \/>\nInsurance Corporation  (Amendment) Act, 1981 (act 1 of 1981)<br \/>\nwhich came into force on 31st of January, 1981 provided that<br \/>\nunder Sub-section  A of\t section 48  of the  Life  Insurance<br \/>\nCorporation Act, 1956. the Regulations which were already in<br \/>\nforce immediately  before the  commencement of the Amendment<br \/>\nAct shall  be  deemed  to  be  Rules  made  by\tthe  Central<br \/>\nGovernment  and\t  they\tshall\tbe  deemed  to\thave  effect<br \/>\nnotwithstanding\t anything   contained  in   the\t  Industrial<br \/>\nDisputes Act,  1947. The  validity of  the Amendment Act was<br \/>\nupheld by  this Court  in A.V. Nachane and another vs. Union<br \/>\nof India  and another  AIR 1982\t SC 1126 = 1982 (2) SCR 246=<br \/>\n(1982) 1  SCC 205.  For this  reason also,  the ground\tthat<br \/>\ntermination would  amount to retrenchment within the meaning<br \/>\nof section  2(00) of  the Industrial  Disputes Act cannot be<br \/>\nentertained.\n<\/p>\n<p>     For the  reasons stated  above, the  judgment passed by<br \/>\nthe Single  Judge of  the  High\t Court\tand  upheld  by\t the<br \/>\nDivision Bench cannot be sustained. Consequently, the appeal<br \/>\nis allowed.  the judgments  passed by the High Court (by the<br \/>\nSingle judge  as also  by the Division Bench ) are set aside<br \/>\nand the\t order of discharge dated 22.5.1986 is upheld. There<br \/>\nwill be no order as to costs.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Supreme Court of India Life Insurance Corporation Of &#8230; vs Shri Raghavendra Seshagiri Rao &#8230; on 14 October, 1997 Bench: M.K. Mukherjee, K.T. Thomas PETITIONER: LIFE INSURANCE CORPORATION OF INDIA &amp; ANR. Vs. RESPONDENT: SHRI RAGHAVENDRA SESHAGIRI RAO KULKARNI DATE OF JUDGMENT: 14\/10\/1997 BENCH: M.K. MUKHERJEE, K.T. THOMAS ACT: HEADNOTE: JUDGMENT: THE 23RD DAY OF [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_lmt_disableupdate":"","_lmt_disable":"","_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[30],"tags":[],"class_list":["post-157817","post","type-post","status-publish","format-standard","hentry","category-supreme-court-of-india"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.3 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Life Insurance Corporation Of ... vs Shri Raghavendra Seshagiri Rao ... on 14 October, 1997 - Free Judgements of Supreme Court &amp; High Court | Legal India<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.legalindia.com\/judgments\/life-insurance-corporation-of-vs-shri-raghavendra-seshagiri-rao-on-14-october-1997\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Life Insurance Corporation Of ... vs Shri Raghavendra Seshagiri Rao ... on 14 October, 1997 - Free Judgements of Supreme Court &amp; 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