JUDGEMENT 1. Heard learned counsel for the petitioner and the counsel for the Bihar Education Project Council (hereinafter referred to as the "Council"). 2. Petitioner is aggrieved, by the order dated 4.3.2009, Annexure-11, whereunder his service contract with the Council has been directed to be terminated by the Project Director with effect from 3.4.1999 in the light of the contents of the report of the District Magistrate, Saran, Distcict Superintendent of Education-cum-District Coordinator, Saran. Petitioner is also aggrieved by the order dated 1.10.2009 passed by the Project Director, Annexure-19, whereunder his request for review of the earlier order dated 4.3.2009, Annexure-11 in compliance of the orders of this Court dated 23.6.2009 passed in C.W.J.C. No. 6965 of 2009 has been rejected. 3. It is submitted on behalf of the petitioner that the aforesaid two orders terminating the service contract of the petitioner has been passed by the Project Director de hors the provisions contained in the Bihar Education Project Service Regulations (hereinafter referred to as the "Regulations") which inter alia provide that a proceeding be initiated against the employee of the Council before any penalty as enumerated in Rule 52 of the Regulations is inflicted on him. In this connection reference is made to Rule 54 of the Regulations which inter alia provide that no order imposing any penalty on any employee shall be passed except after informing the employee in writing of the action proposed to be taken against him. It is further submitted on behalf of the petitioner that before the Project Director proceeded to pass the order dated 4.3.2009, Annexure-11 he never informed the petitioner in writing of the charges levelled against him as also of the action proposed to be taken against him and straightway proceeded to pass the impugned order terminating the contract on the basis of the reports received from the District Magistrate and the District Superintendent of Education-cum-District Coordinator, Saran. In the background aforesaid it is submitted that for the failure of the Project Director to inform the petitioner of the charges levelled against him as also of the action proposed to be taken against him the order suffers from the vice of being violative of the provisions contained in Rule 54 of the Regulations and on this ground alone the same should be set aside. 4. Counsel for the Council has opposed the prayer made in the writ petition. 4. Counsel for the Council has opposed the prayer made in the writ petition. He states that petitioner was employed to serve the Council on contract basis and the contract itself came to an end on 21.5.2009 and as the contract itself has come to an end this Court should not direct for reinstatement even if the impugned orders suffers from the vice of arbitrariness and has been passed without complying the provisions of Rule 54 of the Regulations. In support of such submission learned counsel has relied on the Division Bench judgment of this Court dated 22nd April, 2010 passed in L.P.A. No. 1451 of 2009 in the case of The Director, Bihar Education Project Council V/s. Satya Narayan Baitha and Ors., paragraphs 20 and 21, for ready reference which is quoted hereinbelow: "(21) Thus, in the present case the order of the learned Single Judge directing reinstatement of the writ petitioner with back wages in the facts of the present case where the contract period of three years of his service has come to an end on 2.1.2010 cannot be upheld by us." 5. In rejoinder learned counsel for the petitioner submitted with reference to the orders appointing the petitioner dated 20.5.1998, 8.6.1998, 27.5.1999, 26.5.2000, 21.5.2001, 4.8.2004 that petitioner was appointed in the Council on contract basis initially for one year but such appointment was extended from time to time and he served the Council for about 10 years. The termination of his contract of service without applying the provisions of the Regulation is wholly arbitrary and violative of Articles 14, 16 of the Constitution of India. 6. Having heard counsel for the parties and having perused the appointment letters of the petitioner it is evident that petitioner was appointed on contract basis in the Council initially for one year but such appointment has been extended from time to time until the contract of service was terminated under order dated 4.3.2009, Annexure-11. It further appears from perusal of Annexure-11 that the service contract of the petitioner has been terminated on the basis of the allegations made against him by the District Magistrate, Saran and the District Superintendent of Education-cum-Project Coordinator, Saran. The term employee has been defined in sub-clause (ix) of Clause 3 of the Regulation to include even those employees of the Council who have been appointed on contract basis. The term employee has been defined in sub-clause (ix) of Clause 3 of the Regulation to include even those employees of the Council who have been appointed on contract basis. The effect of cancellation of the service contract of the petitioner is removal or dismissal of the petitioner from the service of the Council which is penalty within the meaning of Rule 52 of the Regulation. Penalty within the meaning of Rule 52 cannot be imposed on the employee without observing the procedure for imposing penalty as is provided under Rule 54 of the Regulation. This Court has no difficulty in concluding that the order terminating the contract of the petitioner dated 4.3.2009, Annexure-11 was required to have been passed after conducting the proceeding against him, as is required under Rule 54 of the Regulation. Penalty having been imposed without observing the procedure provided under Rule 54 suffers from the vice of arbitrariness, accordingly the order dated 4.3.2009, Annexure- 11 is set aside alongwith the subsequent order dated 1.10.2009, Annexure-19 passed by the Project Director. Having set aside the two orders dated 4.3.2009 and 1.10.2009, I direct the Project Coordinator to reinstate the petitioner and serve him With the memo of charge and proceed against him, as is provided under Rule 54 of the Regulation. The back wages for the period between 4.3.2009 till the date of this order shall be subject to the result of the proceeding. Petitioner, however, shall be paid his current salary as per the terms of the contract until fresh order is passed in accordance with law. 7. The writ application is, accordingly, allowed.