Abhishek Kumar v. Life Insurance Corporation of India
2024-01-03
RAJESH SHANKAR
body2024
DigiLaw.ai
JUDGMENT : The present writ petition has been filed for quashing the order as contained in letter Ref: Sales/Mar/32 dated 06.01.2016 issued by the respondent No.5 to the petitioner whereby his service as Probationary Development Officer has been terminated with immediate effect i.e. from 06.01.2016 on the ground of not achieving minimum assigned business targets. 2. Learned counsel for the petitioner submits that the Life Insurance Corporation (LIC) of India, through its East Central Zonal Office, Patna published employment notice in its official website inviting online applications from eligible candidates for recruitment of Apprentice Development Officers with one of the stipulations that an Apprentice Development Officer would have to undergo Theoretical & Field Sales Training and on successful completion of apprenticeship, if found suitable for appointment in the service of the LIC in accordance with the rules, he/she might be appointed as Development Officer on probation, subject to the conditions framed by the LIC. Pursuant to the said advertisement, the petitioner applied for appointment on the post of Apprentice Development Officer and after clearing written test followed by interview, he was finally declared successful. After successful completion of training, he was appointed as Probationary Development Officer vide letter Ref: HDO/SALES dated 5.7.2014 issued by the respondent No.2 in pursuance thereof, he joined his duty at Ramgarh Branch of the LIC as Probationary Development Officer and started discharging his duty with full sincerity and best ability so as to achieve assigned target of business up to the satisfactory level. 3. It is further submitted that three persons including the petitioner were appointed as Probationary Development Officers in Hazaribagh Division of LIC in pursuance of the said advertisement, out of which the performance of the petitioner was much higher than other two persons. The Executive Director (Marketing/P.D), Central Office, Mumbai vide letter dated 11.9.2014 addressed to the Zonal Managers of different Zonal Offices of LIC issued instruction that in case a Probationary Development Officer, whose present performance was not within the parameters as specified by the Central Office, Marketing Department, Mumbai, but had the potential to perform better, the Sr. Divisional Manager might take a decision depending upon the merit of the case.
Divisional Manager might take a decision depending upon the merit of the case. In the earlier batch of appointment, the Probationary Development Officers, who had not been able to fulfil the targets assigned to them, were also confirmed on the said post by the respondent No.2 keeping in view their potential to perform better. The petitioner could not fulfil the target assigned to him since his mother met with an accident due to which he got disturbed. The petitioner had recruited 17 candidates as LIC agents till the December, 2015 and had fulfilled the target set out by the respondents. The petitioner again started working with full sincerity and deposited Rs.2,34,000/- in March, 2016 and still having Rs.3 Lac in hand. The petitioner had also sponsored 4 agents in March, 2016 out of which 3 were still working and one of them was ready to be coded. Moreover, the petitioner was appointed by the respondent No.2, however, the impugned termination letter was issued by the respondent No.5, who is an authority subordinate to the appointing authority and in that view of the matter, the impugned letter of termination is wholly illegal and without jurisdiction. 4. It is also contended that the petitioner represented the respondent No.2 on 7.4.2016 requesting to provide him one more chance to prove his ability and sincerity in performing the duty, however, the same was not responded. The impugned order of termination has been passed in violation of the principles of natural justice as neither any show-cause notice was issued to the petitioner nor he was given an opportunity of being heard before passing the said order. 5. Per-contra, learned counsel for the respondents submits that the petitioner was appointed as Probationary Development Officer vide letter dated 05.07.2014 and he was initially put on probation for one year for the period from 06.07.2014 to 05.07.2015. As per Clause 10 of the appointment letter dated 05.07.2014, the petitioner was required to secure through the agents recruited at his instance, minimum completed Life Insurance Business yielding a scheduled first year premium income which should have been such that cost ratio remains within the prescribed limit of 16%. Further, the minimum business set out by the petitioner was also needed to be spread over not less than 300 policies which was required to be secured regularly through the network of the agents recruited by him.
Further, the minimum business set out by the petitioner was also needed to be spread over not less than 300 policies which was required to be secured regularly through the network of the agents recruited by him. The petitioner was also required to recruit minimum 15 agents. Clause 11 of the appointment letter dated 05.07.2014 clearly provides that confirmation of the petitioner in Class-II services of the LIC was dependant upon his satisfactory completion of the period of probation as well as observance and compliance of all the conditions set out in the letter of appointment. It has been made clear in the said clause of the appointment letter that the confirmation of the petitioner would depend inter alia upon fulfilment of the minimum business requirements set out in Clause 10 of the appointment letter. 6. It is further submitted that on completion of the probation period, the petitioner could not achieve the assigned target and in view of the terms and conditions of employment mentioned in the appointment letter, he was not entitled to be confirmed in the service of the LIC. However, based on the recommendation of the Branch Manager In-Charge, LIC, Bhurkunda, Ramgarh, it was decided by the competent authority to extend his probation period for further period of six months from 06.07.2015 to 05.01.2016 to enable him to procure the target assigned to him. After expiry of the extended probation period, the performance of the petitioner was again reviewed and it was found that he could not achieve the assigned target/business required for confirmation. Thus, the decision was taken by the competent authority not to confirm the services of the petitioner and the said decision was communicated to him vide letter dated 06.01.2016. The impugned order of termination was also approved by the respondent No.2 being the competent authority for the said purpose and the same was communicated to the petitioner by the Manager (Sales), which was in accordance with the terms and conditions of the appointment letter as well as the Life Insurance Corporation of India (Staff) Rules, 1960 framed for governing the terms and conditions of the employment of the Development Officers/Probationary Development Officers of LIC. 7. It is also submitted that the petitioner was provided ample opportunity to improve his performance, however, he failed to do so in spite of repeated extensions granted to him.
7. It is also submitted that the petitioner was provided ample opportunity to improve his performance, however, he failed to do so in spite of repeated extensions granted to him. The petitioner filed representation dated 07.04.2016 before the respondent No.2 for reconsideration of his case and thereafter the response was sought from the respondent Nos. 3 & 4. After receipt of the recommendations as well as the statements of the respective Branch Managers, it was found that the request for reconsideration by the petitioner could not have been accepted. After expiry of the extended probation period, no further extension was granted to the petitioner and the services of the petitioner automatically came to an end. The principles of natural justice do not apply in the present case as the confirmation has been denied only on the ground that the petitioner failed to perform as per the terms and conditions of the appointment letter. 8. Heard learned counsel for the parties and perused the relevant materials available on record. The petitioner is aggrieved with the impugned order dated 06.01.2016 whereby his services as Probationary Development Officer has been terminated on the ground that he has failed to achieve the assigned target of business as stipulated under Clause 10 of the appointment letter dated 5.7.2014. 9. Thrust of the argument of learned counsel for the petitioner is that the petitioner had failed to achieve the assigned target of LIC business since he was disturbed due to accident of his mother and if one more chance was given to him, he would have certainly achieved the target. 10. On the other hand, the contention of learned counsel for the respondents is that it was stipulated in the appointment letter itself that during the probation period, the petitioner would have to achieve the target set out in Clause 10 of the appointment letter and he would be confirmed in service only after fulfilling the said target. It has further been contended that since the petitioner failed to achieve the target stipulated under Clause 10 of the appointment letter even after grant of extensions on three different occasions for a total period of six months, he was terminated from service. 11.
It has further been contended that since the petitioner failed to achieve the target stipulated under Clause 10 of the appointment letter even after grant of extensions on three different occasions for a total period of six months, he was terminated from service. 11. To appreciate the rival contentions of learned counsel for the parties, it would be appropriate to refer herein Clause 10 & 11 of the appointment letter issued to the petitioner which read as under: “10. MINIMUM BUSINESS: i) During the probationary period you shall secure through the agents recruited at your instance minimum completed life business yielding a Scheduled First Year Premium Income which should be as such that the Cost Ratio remains within the prescribed limit of 16%. ii) The minimum business set out in (i) shall be spread over not less than 300 Policies and shall be secured regularly through a network of agencies recruited by you. iii) You will be required to recruit minimum of 15 agents. iv) If your probationary period is extended, you shall secure during the extended period such business as may be intimated to you. 11. CONFIRMATION AND INCREMENTS: (i) On your satisfactorily completing the period of probation and your observance and compliance with all conditions set out in this letter of appointment, you will be confirmed in the services of the Corporation in Class II. Your confirmation will depend, inter alia upon the fulfilment, of the minimum business requirements set out in Para 10 above and upon your record or post- sales services to the Corporation's policyholders and other functions performed by you in the area allotted to you to the satisfaction of the Competent Authority. ii) The grant of increments to you shall be governed by the targets assigned to you as per this appointment letter read with Regulation 56 of LIC of India (Staff) Regulations, 1960 and such other rules as amended from time to time.” 12. It thus appears that during the probation period, the petitioner was required to achieve the target of minimum business as stipulated under Clause 10 of the appointment letter and achieving of the said target was the condition precedent for confirmation of his service. Admittedly, the petitioner failed to achieve the said target during the probation period.
It thus appears that during the probation period, the petitioner was required to achieve the target of minimum business as stipulated under Clause 10 of the appointment letter and achieving of the said target was the condition precedent for confirmation of his service. Admittedly, the petitioner failed to achieve the said target during the probation period. The petitioner was also granted three extensions in the probation period for a total period of six months, however, he failed to achieve the said target and thereafter the impugned letter of termination of his services as Probationary Development Officer was issued by the respondent No.5 on 06.01.2016. 13. Learned counsel for the respondents has put much reliance on the judgment rendered by a Division Bench of this Court in the case of Life Insurance Corporation of India, Jamshedpur & Ors. Vs. Haripad Rohidas reported in 2005 SCC OnLine Jhar 413. In the said case, the petitioner was appointed as a Probationary Development Officer and subsequently he was terminated from service on the ground that he failed to achieve the target. The said petitioner challenged the order of termination by filing a writ petition which was allowed by a co-ordinate Bench of this court and the order of termination was set aside. In L.P.A, the learned Division Bench set aside the judgment passed by learned Single judge observing as under: “8. The main contention of Mr. Prasad, however, was that the views expressed by the Hon'ble Supreme Court in the case of Daya Ram Dayal, ( (1997) 7 SCC 443 : AIR 1997 SC 3269 ) (Supra), on which the learned Single Judge had relied, had been specifically over-ruled in the later decision of the Hon'ble Supreme Court in Satya Narayan Jhavar's case (Supra). As will appear from the decision of the Hon'ble Supreme Court in the said case, the question regarding expiry of the maximum period of probation had been duly considered and it had been found that the expiry of the maximum period of probation had not resulted in automatic confirmation of the petitioner's service, but that other conditions for confirmation were required to be considered before an order of confirmation could be passed. Mr.
Mr. Prasad pointed out that in the instant case, the facts were similar in that one of the preconditions for confirmation of service was to achieve certain targets mentioned in the appointment letter, which the writ petitioner had failed to achieve. It would be worthwhile to quote the relevant portion of the judgment of the Hon'ble Supreme Court in Satya Narayan Jhavars case, ( (2001) 7 SCC 161 : AIR 2001 SC 3234 , Para 36) (Supra) which reads as follows:- “It is too well settled that an order of confirmation is a positive act on the part of the employer which the employer is required to pass in accordance with the Rules governing the question of confirmation subject to a finding that the probationer is in fact fit for confirmation. This being the position under sub-rule (1) of Rule 24, it is difficult for us to accept the proposition, broadly laid down in the case of Dayaram Dayal, ( (1997) 7 SCC 443 : AIR 1997 SC 3269 ) (Supra) and to hold that since a maximum period of probation had been provided thereunder, at the end of that period, the probationer must be held to be deemed to be confirmed on the basis of the judgment of this Court in the case of Dharam Singh ( AIR 1968 SC 1210 ) (Supra)”. 10. Having considered the submissions made on behalf of the respective parties, we are unable to uphold the views expressed by the learned Single Judge and we are inclined to agree with Mr. Prasad that having regard to the later decision of the Hon'ble Supreme Court in the case of Satya Narayan Jhavar ( (2001) 7 SCC 161 : AIR 2001 SC 3234 ) (Supra), the mere fact that the writ petitioner had completed the maximum period of probation, could not have automatically confirmed him in service. As explained by the Hon'ble Supreme Court, such confirmation would have to be a positive act on the part of the employer.” 14. In the aforesaid judgment, the order of termination of services of the petitioner of that case on the ground of not achieving the target was affirmed by learned Division Bench of this Court observing that there should not be automatic confirmation in service after completion of maximum period of probation. 15.
In the aforesaid judgment, the order of termination of services of the petitioner of that case on the ground of not achieving the target was affirmed by learned Division Bench of this Court observing that there should not be automatic confirmation in service after completion of maximum period of probation. 15. In the present case also, the petitioner was appointment on the post of Probationary Development Officer and he did not achieve the target as stipulated in the appointment letter and as such he cannot claim extension of probation period/confirmation on the said post. 16. The other limb of argument of learned counsel for the petitioner is that the impugned order of termination of the petitioner’s service has been passed in violation of the principles of natural justice as neither any show-cause notice was issued to him nor he was given an opportunity of hearing to explain his case. I do not find any merit in the said argument of learned counsel for the petitioner as he has been terminated on the ground of not achieving the target assigned to him during the probation period. Moreover, Clause 2 of the appointment letter issued to the petitioner specifically provides that he shall be liable to be discharged from the services of the Corporation during the probation period (which includes the extended probation period) without any notice and without any cause being assigned. The petitioner was not confirmed on the said post as he failed to achieve the assigned target during the probation period and thus he cannot claim compliance of the principals of natural justice before passing the order of his termination from service. 17. Learned counsel for the petitioner has put much reliance on the letter dated 11.09.2014 written by the Executive Director (Marketing/P.D), LIC, Central Office, Marketing Department, Mumbai to the Zonal Managers of different Zonal Officers of LIC. I have perused the said letter whereby it has been informed to the Zonal Managers that in view of Clause 23(d) of Instruction for Implementation of Life Insurance Corporation of India (Recruitment of Apprentice Development Officers) Regulations, 1999, the Sr. Divisional Manager is the competent authority with regard to extension of probation/confirmation of Probationary Development Officers. Therefore, in case a Probationary Development Officer, whose present performance is not within the specified parameters, the Sr. Divisional Manager may take decision depending upon the merit of the case. 18.
Divisional Manager is the competent authority with regard to extension of probation/confirmation of Probationary Development Officers. Therefore, in case a Probationary Development Officer, whose present performance is not within the specified parameters, the Sr. Divisional Manager may take decision depending upon the merit of the case. 18. The aforesaid letter dated 11.09.2014 also speaks that the power of extending the probation period or confirming the services of a probationary development officer lies with the Sr. Divisional Manager and such power shall be exercised depending upon the merit of a particular case. Thus, the petitioner has no vested right to claim extension/confirmation, rather it is solely upon the discretion of the respondent No.2 to extend the period of probation or confirm the service of a Probationary Development Officer and in the case in hand, the respondent No.2 has not found it appropriate to extend the period of probation of the petitioner so as to give him one more chance to achieve the assigned target set out in the appointment letter issued to him. 19. One of the arguments of learned counsel for the petitioner is that the impugned order of termination has been passed by the respondent No.5, who is below the rank of the appointing authority of the petitioner and on that ground alone, the impugned order is liable to be vitiated. The said argument of learned counsel for the petitioner is also not tenable in view of the specific stand of the respondents that the order of termination has been approved by the respondent No.2, who is the appointing authority of the petitioner and the respondent No.5 has merely communicated the order of termination to the petitioner. 20. In view of the aforesaid discussions, I do not find any merit in the present writ petition and the same is accordingly dismissed.