Research › Search › Judgment

Himachal Pradesh High Court · body

2012 DIGILAW 266 (HP)

Kamal Krishan Goel v. Life Insurance Corporation Of India

2012-05-08

R.B.MISRA, SANJAY KAROL

body2012
JUDGMENT : Sanjay Karol, J. This is the petitioners (appellant herein) Letters Patent Appeal filed against the judgment dated 24th November, 2003, passed by learned Single Judge of this Court in CWP No. 2753 of 1995, titled as Krishan Goel v. Life Ins. Corpn. of India & ors. 2. Facts are not much in dispute. With effect from 8th April, 1992, appellant was appointed as Apprentice Development Officer, in terms of appointment order dated 27th June, 1992 (Page-180). In terms of Clause-2 of the said order, appellant was to be on probation, initially for a period of 12 months, which could be extended upto another period of 12 months. The total period of probation was not to exceed 24 months. His headquarters were fixed at Kunihar and his duty was to develop and increase production of Life Insurance Business, in a planned way, through the agents placed under his supervision and in consonance with the corporate object of the Corporation. He was to ensure minimum business of a particular amount. His appointment was to be regulated in terms of India (Staff) Regulations, 1960. Appellant failed to discharge his duties in terms of the appointment letter. Consequently, his services were terminated, w.e.f. 27th October, 1992. He made a detailed representation, dated 7th November, 1992, requesting for revocation of his termination. Respondent-Corporation was persuaded to accept the same and vide letter dated 18th March, 1993, his services were reinstated, on the following conditions: "1. The entire period from the date of termination till date of your rejoining your duties will be treated as "DIES-NON". 2. That henceforth you will stay at your headquarters and properly develop the area allotted to you by selecting suitable (sic: suitable) agents imparting them required training to enable them to transact Life Insurance business. 3. Your performance as well as your field activities shall be watched closely and in case it is found that you are not staying at your headquarter and/or you fail to discharge your duties properly, you will be liable to disciplinary action." Appellant accepted the same and joined at the place of his posting. However, for the period for which he did not work, i.e. 31st October, 1992 to 17th March, 1993, which period was treated as dies non, appellant made a representation for reconsideration. However, for the period for which he did not work, i.e. 31st October, 1992 to 17th March, 1993, which period was treated as dies non, appellant made a representation for reconsideration. It was rejected and conveyed to the appellant, in terms of letter dated 13th August, 1993 (Annexure PF, page-198). 3. It was specifically conveyed to the appellant that he shall not be deemed to be confirmed, even after expiry of probationary period, till his performance is reviewed by the competent authority and till such time decision is taken in that regard, he shall continue to be on probation. Subsequently vide letter dated 13th May, 1994 (Annexure PQ, page-209) appellants period of probation was extended for a period of one year upto 23rd August, 1994. He was cautioned and advised to continue to remain present at his headquarters, which he had persistently defaulted to do so. 4. For the sake of better appreciation, the letter dated 13th May, 1994 is reproduced below: "Shri K.K. Goel Prob. Dev. Officer LIC of India Branch Office Solan Dear Sir, Re: Your Probationary Period Consequent upon the rejection of your appeal by the Competent Authority for allowing you to give the credit of business done during the Dies-Non period w.e.f. 31.10.92 to 17.3.93, we have now considered your performance for the probationary period ending 23.8.93. We find that you have fulfilled the norms for Sum Assured and Schedule First Year Premium Income, as mentioned in the Appointment letter dated 27.6.92. However, you have not qualified at least 9 agents during the Probationary Period. Further, it has also been noticed that still you are not staying continuously at your headquarter i.e. Kunihar. However, taking a lenient view, it has been decided to extend your probationary period by one year upto 23.8.94, during which you are required to fulfil following norms of performance w.e.f. 24.8.93 to 23.8.94:- Sum Assured : 60 lacs SFYPI : 1.90 lacs No. of lives : 120 Active Agents : 15 Qualified Agents : 9 You are advised in your own interest to stay at your headquarter permanently and develop the area of operation for Insurance Work in terms of Appointment Letter dated 27.6.92. We may also inform you that your performance shall be further reviewed after receiving the performance results as on 23.8.94 and till you hear from us you shall not be deemed to have been confirmed. We may also inform you that your performance shall be further reviewed after receiving the performance results as on 23.8.94 and till you hear from us you shall not be deemed to have been confirmed. Yours faithfully, Sd/- Sr. Divisional Manger" 5. Subsequently, vide communication dated 19th August, 1994, appellants services were terminated, within the period of probation, contents of which read as under: "Shri Kamal Krishan Goel, Prob. Development Officer, Code No.1212, L.I.C. of India, Village & P.O. Kunihar, District Solan (HP)-173207. Dear Sir, Re: Your Services As Prob. Development Officer. Please refer to our letter Ref. Sales dated 27.6.1992 putting you on probation w.e.f. 8.4.1992 and our letter dated 13.5.1994 extending your probation period upto 23.8.1994. In terms of Clause 2 of your appointment letter dated 27.6.1992, it has been decided to discharge you form the services of the L.I.C. of India with immediate effect. Accordingly, you are hereby discharged from the services of the Corporation with immediate effect. To discharge you from the service is without prejudice to the right of the Corporation to recover all dues or any other amount that may be due or become due from you. You should immediately return to Branch Manager, Solan any Manuals, Stationery and any other material issued to you by the L.I.C of India for official use. Yours faithfully, Sr. Divisional Manager" 6. Appellant approached this Court, by filing CWP No. 686 of 1994, titled as Shri Kamal Krishan Goel v. The Life Insurance Corporation of India and others, which was withdrawn by him, in terms of following order dated 26th October, 1994: "Learned counsel for the petitioner having argued the petition at length, sought permission to withdraw the petition to seek other remedy, as may be available to him either under the law or Rules or Regulations. The petition is dismissed as withdrawn." Subsequently, appellant preferred an appeal, which also was rejected by the appropriate Authority. Thereafter, appellant preferred another writ petition, which is now subject matter of adjudication in the instant appeal. 7. In terms of impugned judgment, learned Single Judge has dismissed the writ petition, holding that order of termination, passed within the period of probation, is neither punitive nor stigmatic. The said order is discharge simpliciter and as such, no illegality/ infirmity can be found with the actions of the respondent-Corporation. 8. It is urged by Mr. 7. In terms of impugned judgment, learned Single Judge has dismissed the writ petition, holding that order of termination, passed within the period of probation, is neither punitive nor stigmatic. The said order is discharge simpliciter and as such, no illegality/ infirmity can be found with the actions of the respondent-Corporation. 8. It is urged by Mr. P.P. Chauhan, learned counsel for the appellant that after expiry of period of 24 months, appellants services were deemed to be confirmed and as such respondents could have taken action only in accordance with the Rules/Regulations framed by the Corporation. In effect, relying upon the decision rendered by the Supreme Court in Samsher Singh v. State of Punjab and another, (1974) 2 SCC 831 , it is urged that prior to termination of the appellants services, disciplinary proceedings ought to have been initiated. It is also urged that action of the respondents is malafide, illegal and erroneous as business procured by the appellant for the period, which was held to be dies non, was not considered while adjudging his performance. Still further it is urged that this Court should lift the veil to see the malafides of the authorities who were hell-bent in terminating the appellants services. In this regard, he has relied upon the decision of the Supreme Court in Anoop Jaiswal v. Government of India and another, (1984) 2 SCC 369 . 9. Per contra, Mr. Bhupinder Gupta, learned Senior Advocate, ably assisted by Mr. Janesh Gupta, learned counsel for the respondents-Corporation, while repelling the submission made on behalf of the appellant, has drawn our attention to various letters on record, as also finding of the learned Single Judge and referred to and relied upon the following decisions of the Supreme Court to justify the action taken by the respondents: 1. Abhijit Gupta v. S.N.B. National Centre, Basic Sciences and others, (2006) 4 SCC 469 . 2. Kamal Nayan Mishra v. State of Madhya Pradesh and others, (2010) 2 SCC 169 . 3. Kazia Mohammed Muzzammil v. State of Karnataka and another, (2010) 8 SCC 155 . 4. Rajesh Kohli v. High Court of Jammu and Kashmir and another, (2010) 12 SCC 783 . 5. Rajesh Kumar Srivastava v. State of Jharkhand and others, (2011) 4 SCC 447 . 10. 3. Kazia Mohammed Muzzammil v. State of Karnataka and another, (2010) 8 SCC 155 . 4. Rajesh Kohli v. High Court of Jammu and Kashmir and another, (2010) 12 SCC 783 . 5. Rajesh Kumar Srivastava v. State of Jharkhand and others, (2011) 4 SCC 447 . 10. Having carefully perused the record and heard rival contentions of the learned counsel for the parties, we are of the view that the present appeal only merits rejection. 11. The real test to be applied in a situation where an employee is removed by an innocuous order of termination is: Was he discharged as unsuitable or was he punished for his misconduct? 12. It is a settled position of law that a person is placed on probation so as to enable the employer to adjudge his suitability for continuation in the service and also for confirmation. Various criteria for adjudging suitability of a person to hold the post on permanent basis are to be looked into by the employer at the stage of confirmation. During the period of probation, all actions and activities of an employee are under scrutiny and on the basis of his overall performance a decision is taken to adjudge the confirmation and continuity in service. While taking such a decision, overall performance, conduct and suitability for the job are the prime factors to be looked into. While taking a decision, in this regard, neither any notice is required to be given to the employee nor is he required to be given any opportunity of hearing. In these circumstances, termination simpliciter is not removal from service on the grounds of indiscipline or misconduct but a simple discharge from service. [In Rajesh Kumar Srivastava (supra)]. 13. In Abhijit Gupta (supra), Supreme Court had an occasion to deal with a case where employer had terminated the services of a probationer by a written communication in which reference was made to earlier communications, wherein the employee was called a person of "perverted mind" and "dishonest, duffer having no capacity to learn". Employees contention that such order of termination was stigmatic was repelled by the Court as it was observed that it is the duty of an employer to inform the employee about his deficiencies from time to time, to enable him to improve his behaviour, conduct and discharge of work. Employees contention that such order of termination was stigmatic was repelled by the Court as it was observed that it is the duty of an employer to inform the employee about his deficiencies from time to time, to enable him to improve his behaviour, conduct and discharge of work. In spite of the fact that in some of the letters, reference of which was made in the letter of termination, intemperate language was used, yet Court did not interfere and held the order of termination to be discharge simpliciter and not stigmatic. 14. In Rajasthan State Road Transport Corpn. and others v. Zakir Hussain, (2005) 7 SCC 447 , the apex Court has held that employees of Transport Corporation are not civil servants and as such are not entitled to protection under Article 311 of the Constitution of India. Their terms of appointment are governed by the letter of appointment and, therefore, the Management would be well within their right to terminate the services, if they are found to be unsatisfactory. The transport authorities are not obliged to hold any enquiry before terminating such services of the probationer. [See also: State of Uttar Pradesh and another v. Kaushal Kishore Shukla, (1991) 1 SCC 691 ]. 15. Mere holding of preliminary inquiry where explanation is called from an employee would not make an otherwise innocuous order of discharge or termination of service punitive in nature. (State of Punjab and others v. Sukhwinder Singh, (2005) 5 SCC 569 ). 16. In Radhey Shyam Gupta v. U.P. State Agro Industries Corporation Ltd. and another, (1999) 2 SCC 21 , the apex Court had an occasion to deal with an employee, who was on probation, against whom there were allegations of bribe. Full scale inquiry was held in which the employee was conclusively held to be guilty. Hence, such inquiry was conducted without associating the employee and under these circumstances the Court found that report was not preliminary inquiry report and the employees services could not be terminated as there was motive and not foundation for the employer to terminate the services, which order is punitive in nature. The ratio in the said case was noticed and explained subsequently by the apex Court in Pavanendra Narayan Verma v. Sanjay Gandhi PGI of Medical Sciences and another, (2002) 1 SCC 520 . 17. The ratio in the said case was noticed and explained subsequently by the apex Court in Pavanendra Narayan Verma v. Sanjay Gandhi PGI of Medical Sciences and another, (2002) 1 SCC 520 . 17. View taken by the Supreme Court in Krishnadevaraya Education Trust and another v. L.A. Balakrishna, (2001) 9 SCC 319 , that if in response to the challenge, employer states that services were not satisfactory, that fact would not ipso facto mean that termination of appellants services is by way of punishment, stands reiterated in Rajesh Kohli (supra). 18. The apex Court in Registrar, High Court of Gujarat and another v. C.G. Sharma, (2005) 1 SCC 132 , has held that even if period of probation prescribed under the Rules expires and probationer is allowed to continue thereafter, automatic confirmation cannot be claimed as a matter of right. The Court was dealing with a case where not only there was no vacancy available, but also services of the employee were found to be unsatisfactory. Court also reiterated its earlier view taken in State of Maharashtra v. Veerappa R. Saboji, (1979) 4 SCC 466 and State of Punjab v. Dharam Singh, AIR 1968 SC 1210 . Similar view was also taken in Kazia Mohammed Muzzammil (supra). 19. In Pavanendra Narayan Verma (supra), the apex Court had an occasion to deal with the case where services of an employee, who was appointed on 10th April, 1996 and on extended period of probation, were terminated vide order dated 6th February, 1998. Such challenge by the employee was repelled and the principles of law laid down in Parshotam Lal Dhingra v. Union of India, AIR 1958 SC 36 , Samsher Singh (supra) as also Chandra Prakash Shahi v. State of U.P., (2000) 5 SCC 152 , were reiterated and summed up in the following terms: "19. Thus some courts have upheld an order of termination of a probationer's services on the ground that the enquiry held prior to the termination was preliminary and yet other courts have struck down as illegal a similarly worded termination order because an inquiry had been held. Courts continue to struggle with semantically indistinguishable concepts like 'motive' and 'foundation'; and terminations founded on a probationer's misconduct have been held to be illegal, while terminations motivated by the probationer's misconduct have been upheld. Courts continue to struggle with semantically indistinguishable concepts like 'motive' and 'foundation'; and terminations founded on a probationer's misconduct have been held to be illegal, while terminations motivated by the probationer's misconduct have been upheld. The decisions are legion and it is an impossible task to find a clear path through the jungle of precedents, 28. Therefore, whenever a probationer challenges his termination, the court's first task will be to apply the test of stigma or the 'form' test. If the order survives this examination, the 'substance' of the termination will have to be found out." 20. The apex Court in M. Venugopal v. Divisional Manager, Life Insurance Corporation of India, Machilipatanam, A.P. and another, (1994) 2 SCC 323 , had occasion to deal with an employee whose services were terminated during the period of probation, as they were found to be unsatisfactory and not conforming to the clauses of contract of appointment, with regard to generation of minimum business. Significantly, Court was dealing with the appointment of an employee of a Life Insurance Corporation, having terms similar to the one in the instant case. The Court held that the regulations framed under the provisions of Life Insurance Corporation Act are statutory and would override the provisions of the Industrial Disputes Act. The Court further held that contractual terms would acquire statutory force, in view of such regulations and services of the employee, who does not fulfil such terms, can be terminated after making overall assessment of his performance during the period of probation and in such a case no notice is required to be given to an employee. 21. The question as to whether after expiry of 24 months, services of the appellant can be deemed to be confirmed or not needs to be examined in the light of the ratio of law laid down by the Apex Court in Samsher Singh (supra). In the said case, Court was dealing with a case of an officer, who during his period of probation was given notice of his unsatisfactory performance. His services were not confirmed even after completion of three years period for which he was put on probation. Court held that there cannot be any implied extension of probationary period as maximum period of probation for three years is directory and not mandatory, particularly, when employee was not confirmed within the aforesaid period. His services were not confirmed even after completion of three years period for which he was put on probation. Court held that there cannot be any implied extension of probationary period as maximum period of probation for three years is directory and not mandatory, particularly, when employee was not confirmed within the aforesaid period. This view stands reiterated by the Apex Court in Punjab National Bank by Chairman and another v. Astamija Dash, (2008) 14 SCC 370 . 22. In Governing Council of Kidwai Memorial Institute of Oncology, Bangalore v. Dr. Pandurang Godwalkar and another, (1992) 4 SCC 719 , the apex Court held: "If an employee who is on probation or holding an appointment on temporary basis is removed from the service with stigma because of some specific charge, then a plea cannot be taken that as his service was temporary or his appointment was on probation, there was no requirement of holding any enquiry, affording such an employee an opportunity to show that the charge levelled against him is either not true or it is without any basis. But whenever the service of an employee is terminated during the period of probation or while his appointment is on temporary basis, by an order of termination simpliciter after some preliminary enquiry it cannot be held that as some enquiry had been made against him before the issuance of order of termination it really amounted to his removal from service on a charge as such penal in nature. When an appointment is made on probation, it presupposes that the conduct, performance, ability and the capacity of the employee concerned have to be watched and examined during the period of probation. He is to be confirmed after the expiry of probation only when his service during the period of probation is found to be satisfactory and he is considered suitable for the post against which he has been appointed. The principle of tearing of the veil for finding out the real nature of the order shall be applicable only in a case where the Court is satisfied that there is a direct nexus between the charge so levelled and the action taken. The principle of tearing of the veil for finding out the real nature of the order shall be applicable only in a case where the Court is satisfied that there is a direct nexus between the charge so levelled and the action taken. If the decision is taken, to terminate the service of an employee during the period of probation, after taking into consideration the overall performance and some action or inaction on the part of such employee then it cannot be said that it amounts to his removal from service as punishment. It need not be said that the appointing authority at the stage of confirmation or while examining the question as to whether the service of such employee be terminated during the continuance of the period of probation, is entitled to look into any complaint made in respect of such employee while discharging his duties for purpose of making assessment of the performance of such employee. Even if such employee while questioning the validity of an order of termination simpliciter brings on the record that some preliminary inquiry or examination of some allegations had been made, that will not vitiate the order of termination." (Emphasis supplied). 23. Having minutely examined the record, we find that there is no foundation for the plea of malafides. It is lacking in the present case. Except for bald, vague and unspecific references, there is nothing on record to substantiate such a plea. Record reveals that appellants performance, which was monitored from time to time, was found to be not satisfactory and in spite of various opportunities afforded to him he failed to show any sign of improvement. 24. In our considered view, respondent-Corporation sympathetically considered and reinstated the appellant in spite of his poor performance and breach of terms of his appointment. He persistently defaulted in staying at his headquarters and procuring minimum business. There is sufficient material on record to substantiate this fact. Reference can be made to letters dated 27th October, 1992, 18th March, 1993, 13th August, 1993 and 13th May, 1994. Despite his performance, he was not only reinstated but probation period was also extended. In their wisdom, respondents afforded him an opportunity of improving himself. 25. Significantly, appellants request for reviewing the order, treating the period of his absence as dies non, was rejected, in terms of communication dated 13th August, 1993. Despite his performance, he was not only reinstated but probation period was also extended. In their wisdom, respondents afforded him an opportunity of improving himself. 25. Significantly, appellants request for reviewing the order, treating the period of his absence as dies non, was rejected, in terms of communication dated 13th August, 1993. Undisputedly, appellant did not challenge the said order any further. He accepted the same. Hence, at this stage and in these proceedings, appellant cannot be allowed to reagitate the question again. 26. Significantly in the instant case prior to completion of period of probation, appellants services were not only terminated but he was reinstated with the specific condition. In no uncertain terms, in the very same communication, he was told that "you will not be deemed to have been confirmed even after the expiry of probationary period till your performance" is reviewed by the competent authority. This period of probation was extended upto 23rd August, 1994. Consequently, it cannot be said that services of the appellant would be deemed to be confirmed after expiry of period of 24 months from the date of his joining, which was on 8th August, 1992. In any event, Rules of the Corporation and terms of appointment of the employee do not prescribe such automatic confirmation. Appellant was on probation and termination took place during this period. 27. We are in respectful agreement with the findings returned by the learned Single Judge that the order of termination is neither stigmatic nor punitive. We find that the order of termination is innocuous and is not reflection upon the appellants capabilities or conduct. In the given facts and circumstances, we find that notices issued to the employee were intended only to arrive at a finding on the desirability of his continuing in service. 28. Having minutely examined the record, we are convinced that in all the communications addressed to the appellant, he was cautioned and advised to achieve his targets and comply with the terms and conditions of his order of appointment. In the instant case, we find that respondent-Corporation, even after giving long rope to the appellant, came to the conclusion that his services were unsatisfactory and there was no hope of his improving his performance. We also find that after work of the appellant was fully assessed by the authorities and order of termination issued. In the instant case, we find that respondent-Corporation, even after giving long rope to the appellant, came to the conclusion that his services were unsatisfactory and there was no hope of his improving his performance. We also find that after work of the appellant was fully assessed by the authorities and order of termination issued. There was sufficient material to assess and determinate overall unsatisfactory performance and conduct of the appellant. His performance was found to be not satisfactory, as such the authorities rightly decided to terminate his services. 29. The apex Court in Anoop Jaiswal (supra) has simply held that where report/recommendation of the superior authority is the basis or foundation for the order, same should be read along with the order of termination for the purpose of determining its true character. Only if on reading the two together, Court arrives at a conclusion that the alleged act of misconduct was the cause of order and but for that incident, order of termination would not have been passed, then it is inevitable that order of discharge would fall on the ground that officer was not afforded a reasonable opportunity to defend himself, as provided under Article 311 (2) of the Constitution of India. The ratio of law is squarely inapplicable to the given facts. Here an employee was afforded adequate opportunity and only after judging his overall performance appropriate authority came to the conclusion that his services being unsatisfactory were required to be terminated and the employee in the instant case is not entitled to the protection under Article 311 of the Constitution of India. Significantly, in the very same judgment Court has held that "even if reputation of a probationer, was to some degree affected, yet if facts could not be reasonably disputed by him, it provided sufficient ground for termination the services and such action would not amount to injustice. An informal inquiry, in a given fact situation, would not amount to giving colour of formal charge or inquiry against the delinquent official". In any event, the ratio was subsequently explained and clarified by the apex Court in Governing Council of Kidwai Memorial Institute of Oncology, Bangalore (supra). Therefore, the present appeal devoid of merit and is dismissed. Pending application(s), if any, also stand disposed of.