State of Punjab and ors. Vs. Sukhwinder Singh - Court Judgment

Excerpt:
service - termination - 16.24, 19.3, 19.5, 12.21 and 12.21(3) of punjab police rules - appeal against order setting aside termination of respondent's service - respondent/probationer's service terminated under rule 12.21 - probationer does not have any right to post - inquiry conducted to obtain primary facts and mentioning of absence from duty cannot qualify as termination punishment - order of termination under rule 12.21 valid - impugned order set aside. - [s.m. sikri, c.j.,; d.g. palekar,; m.h. beg,; a.n. ray and; s.n. dwivedi, jj.] the first petitioner was a public limited company incorporated under the indian companies act. the second and third petitioners were shareholders and directors of the first petitioner. up to the end of march, 1971 the petitioner company was registered under the indian insurance act, 1938. the registration authorised it to carry on the business of general insurance comprising fire and miscellaneous insurance. on september 17, 1970 its board of directors resolved that it would cease to underwrite any insurance business as from the close of business on september 30, 1970. on that very date it informed the controller of insurance of the resolution and returned its certificate of registration for the year 1970 to the controller of insurance. after-the close of business on september 30. 1970 it stopped doing any kind of general insurance business. on october 3, 1970 the controller of insurance returned the registration certificate to it with the remark that there was no provision in the insurance act for return of certificate. the controller advised it not to ,apply for renewal of certificate for the year 1971. on february 2, 1971 the board of directors of the company passed a resolution canceling all policies with effect from march 10/12, 1971 after giving due notice to the policy- holders. another resolution was passed terminating all re- insurance treaties, both inward and outward, with effect from december 31. 1971. the company refunded to the policy- holders a sum of rs. 48.000 on cancellation of their policies. the uncollected refund amount came to rs. 2013.98. on february 16, 1971 the controller of insurance cancelled the registration of the company with effect from april 5, 1971 under section 3(4)(f) of the insurance act. the company reduced its staff from the month of september 1970. by the end of february 1971 the total staff consisted of one officer, one clerk, one typist and one peon. in respect of some of the policies cancelled cases were pending in court. the union of india, the first respondent, appointed a custodian over the undertaking of the company under s. 4 of the general insurance(emergency provisions) ordinance 1971 on may 13, 1971, the said ordinance was eventually reenacted as general insurance (emergency provisions) act. 1971. the union of india issued also certain directions on may 13, 1971 to regulate the management of the undertaking by the custodian. the company filed petitions under article 32 of the constitution claiming that the act of 1971 was not applicable to it because it was an insurer whose business was being voluntarily wound up in terms of section 15(a) of the act and therefore it could not be taken over by the central government under s.. 3 of the act. it was contended that the words "whose business is being voluntarily wound up" in section 15(a) also meant "whose business is being voluntarily brought to a close or final settlement". the company also challenged the constitutionality of part of section 2(e) as also of section 15(a) of the act, under art. 14 of the constitution of india. held : per majority (palekar, beg and dwivedi, jj.) (i) the appellant company could not get the benefit of s. 15(e) and was subject to the provisions of s. 3 of the act which provides for the take over of insurance companies. [966 h] section 2c of the insurance act has limited the denotation of the word 'insurer' from the date of the commencement of the insurance (amendment) act 1950. section 2c(1) provides that "no person shall,, after the commencement of the insurance (amendment) act 1950 begin, to carry on any class of business in india and no insurer carrying on any class of insurance business in india shall, after the expiry of one year from such commencement, continue to carry on any such business unless he is a public company incorporated in or out of india or a society registered under any law relating to co-operative societies act, 1972. in the result at the commencement of the ordinance and the act,'insurer' included a public company either incorporated under the companies act or under a foreign company law and a cooperative society. although according to the proviso to s. 2c(1) the central government may by a gazette notification exempt from the operation of s. 2c(1) any person or insurer for the purpose of carrying on general insurance business for not more than three years at a time, no such notification was shown to have been in fact issued. cooperative societies are under the various state laws relating to cooperative societies wound up by an order of the registrar of cooperative societies. therefore the word insurer in s. 15(a) of the act includes only two classes of persons : (a) public limited company incorporated under the companies act; (b) a public company incorporated under a foreign company law. [960 h; 961 bcrf] the twin expressions "being voluntarily wound up" and "being wound up by a court" have acquired a crystallised meaning in the company and 'insurer' included a public company either incorporated under the companies act and the insurance act. in the companies act the expression " voluntary winding up means a winding up by a special resolution of the company to that effect. section 54 of the insurance act provides its own procedure for the winding up of an insurance company. according to it, an insurance company shall not be wound up voluntarily "except for the purpose of effecting amalgamation or reconstruction of a company on the ground that by reason of its liability it cannot continue its business". parliament will be presumed to know that the expression, " voluntary winding up" and "winding up by the court" have acquired a technical meaning in our company and insurance jurisprudence [961 h; 962 a-d] sections 433(c), 560, 583(4) (a) & 584 of the companies act and sections 2e, 3(5d), 53 of the insurance act make a clear distinction between the cessation of business of a company and its voluntary winding up or winding up by an order of the court. parliament will be presumed to be aware of the distinctions between the cessation of business by an insurance public company and its voluntary winding up or winding up by an order of the court. there is nothing unequivocal in s. 15(a) of the act to show that parliament intended to depart from the technical meaning of these expressions and to bid good-bye to the aforesaid distinction. [963 d-e] the appellant company did not claim that it was being wound up, under s. 54 or s. 58 of the insurance act. it could not voluntarily be wound up otherwise than in accordance with s. 54 of the insurance act. it was accordingly difficult to comprehend the argument that the cessation of business by the appellant company means voluntary winding up of its business. this kind of voluntary winding up of business is unknown to the insurance act. [964 e] the winding up of a foreign company by an order of the court in india really means the winding up of its business in india. the word business' is not therefore redundant in s.15 (a). if parliament really meant that the first limb of s. 15(e) should also apply to as insurer who is in the process of closing its business it should have expressed the first limb in some such manner as any insurer "whose business is being closed" or "is being wound up". the construction put forward by the appellant company assigns little significance to the word "voluntarily" and makes it a surplus age. [965 e-f] regina v. board of trade, [1965] 1 q.b. 603 and rajah of vizinagram v. official receiver, vizianagaram, [1962] supp. 1 s.c.r. 344, referred to. sections 15(b) and 2(e) of the act both refer to an insurance company which has ceased to do business for a certain period. section 15(a) should be construed in the setting of s. 15(b) and 2(e). so construed it is difficult to believe that parliament has not used the expression "whose business is being voluntarily wound up" in the technical sense. [966 d] one of the professed objects of the act is "to protect the interest of the policy-holders pending nationalisation of the general insurance business". the interpretation suggested by the appellant company would defeat that object. assuming that s. 15(a) is susceptible of two meanings-the wider and the narrower (the technical), the one which fructifies the said legislative object should be preferred. [966 f-g] (ii) the challenge to sections 2(e) and 15(a) of the act based on article 14 of the constitution must fail. [968 e] when the registration of a company has remained wholly cancelled for six months from the appointed day, the controller may apply to the court for its winding up under s. 3(5d). as soon as the judicial process is set in motion, the company comes under the control of the court. the court's control will protect those policy holders who have got unsatisfied claims against the company. on the other hand the company whose registration has remained wholly cancelled for less than six months can revive itself. it cannot be wound up by the court at the instance of the ,:controller. the claims of the policy-holders against such a company will remain unprotected., the takeover of the undertaking of the company under the act improves, by reason of the government's management, the prospects of their claims satisfaction. it is also calculated to protect all interests by applying after the takeover, if that course is deemed necessary, to revive the business of the company. section 2(e) is therefore not discriminatory. for the same reasons s. 15(a) also is not discriminatory. [968 b-e] [as the attack based on art. 14 did not succeed, the court found it unnecessary to deal with the respondents' contention based on art. 31a(b) (d) of the constitution.] per sikri c.j. and ray, j. (dissenting). on the language of section 15(a) the company in the present case was an insurer whose business was being voluntarily wound up. therefore the ordinance and the act did not apply to the petitioner company. [955 g] it is important to notice that the act uses the word 'insurer' and not the words 'insurance company'. the insurance act has throughout the act used the words 'insurer' as well as 'insurance company'. the appropriate section in each instance will indicate as to why the act uses the word 'insurer' in one, section and the words 'insurance company' in the other. an insurer under the definition of the insurance act is of wider amplitude than an insurance company. it is an individual or any un- incorporated body of individuals or a body corporate incorporated under the law of a foreign country. from section 2c of the insurance act it follows that an insurer as an individual may be allowed by the government to carry on general insurance business under the government exemption. [948 de & 949 c] the legislature knows the distinction between voluntary winding up of an insurance company or winding up of it by a court and an insurer whose business is being voluntarily wound up or is wound up by court. full effect is to be given to the words used in a legislative measure. the words which are not found in the present legislative measure cannot be substituted by words which are used in other statutes. that would be defeating the purpose of the act. the word 'insurer' cannot be read in place of insurance company. l952 g-h] the provisions in the insurance act relating to voluntary winding up and partial winding up of insurance companies indicate the difference between the concepts of voluntary winding up under the insurance act ,and the indian companies act and the business of an insurance company being voluntarily wound up. a voluntary winding up under the insurance act occurs for the purpose of effecting a reconstruction or amalgamation or on the ground that a company cannot continue its business be-cause it cannot meet its liabilities. none of these contingencies is the same as voluntarily winding up business. a partial winding up of an insurance company is winding up of a particular type of business. that company does not cease to do business. nor is the company voluntarily wound up in such a case. [953 d- e] in the present case the company resolved to wind up its business. the company discontinued to do insurance business. the company cancelled all outstanding policies in the month of february, 1971. the company had not undertaken any new business after 30 september, 1970. [953 h] after 30 september 1970 the company had taken steps to wind up voluntarily all insurance business., the company informed the controller of its decision to stop doing insurance business. the company returned its registration certificate. all these features lead to the inescapable conclusion that the business of the insurer was being voluntarily wound up. therefore the provisions contained in section 15(a) will apply to the company whose business is being voluntarily wound up.. [954 a-b] (ii) in the bank nationalisation case this court said that the court will not, concentrating merely upon the technical objection of the action, deny itself jurisdiction to grant relief to the share holders when the rights of the shareholders as well as of the company are impaired. the locus, standi of the petitioners could not be challenged. [957 c-d] r. c. cooper v. union of india, [1970] 3 s.c.r. 530, referred to. - -where the short history of the service of the probationer appointed in a temporary post clearly showed that his work had never been satisfactory and he was not found suitable for being retained in service and that was why even though some sort of an enquiry was started, it was not proceeded with and no punishment was inflicted on him and in these circumstances, if the appointing authority considered it expedient to terminate the services of the probationer it could not be said that the order of termination attracted the provisions of article 311, when the appointing authority had the right to terminate the service without assigning any reasons. in such a case there is no presumption that the order is arbitrary or mala fide unless a very strong case is made out and proved by the government servant who challenges such an order. (2002)illj690sc ,is a recent decision of this court where, after referring to large number of earlier decisions, the law on the point has been very clearly elucidated in the following manner :one of the judicially evolved tests to determine whether in substance an order of termination is punitive is to see whether prior to the termination there was (a) a full-scale formal enquiry (b) into allegations involving moral turpitude or misconduct which (c) culminated in a finding of guilt. the superior authorities of the departments have to take work from an employee and they are the best people to judge whether an employee should be continued in service and made a permanent employee or not having regard to his performance, conduct and overall suitability for the job. therefore, the high court was clearly in error in holding that the respondent's absence from duty was the foundation of the order, which necessitated an inquiry as envisaged under rule 16.24(ix) of the rules.g.p. mathur, j. 1. this appeal, by special leave, has been preferred by the state of punjab and others challenging the judgment and decree dated 30.1.2001 of the high court of punjab and haryana by which the second appeal preferred by the appellants was dismissed and the decree passed by the courts below decreeing the respondent's suit was affirmed.2. the respondent sukhwinder singh joined on 4.8.1989 as a police constable and was allotted number 644 in district amritsar in the state of punjab. he was sent for training at police recruit training college jahan khelan. he absented from duty w.e.f. 22.2.1990 without making any application for grant of leave or seeking permission for his absence. the senior superintendent of police, amritsar, passed the following order on 16.3.1990:-'constable sukhwinder singh no. 644/asr of this district is discharged from service w.e.f. 16.3.1990 under punjab police rules 12.21 as he is not likely to become an efficient police officer.'the respondent sukhwinder singh filed a civil suit in the court of sub-judge, amritsar, seeking a declaration that the order dated 16.3.1990, passed by the senior superintendent of police, amritsar, discharging him from service, was illegal and inoperative in law as it was passed by way of punishment, without holding any enquiry and without giving him any opportunity of hearing. the appellants herein contested the suit on various grounds and the main plea taken therein was that the respondent had to put in less than three years of service and was a probationer on the date of passing of the order dated 16.3.1990 and, therefore, he was rightly discharged under rule 12.21 of the punjab police rules (hereinafter referred to as the 'rules') by the senior superintendent of police. the senior superintendent of police was of the opinion that the respondent was not likely to become an efficient police officer and, therefore, he exercised his powers under rule 12.21. it was further pleaded that the respondent being a probationer had no right to the post. the order of discharge did not cast any stigma and did not affect him with any evil consequences.3. the learned sub-judge, amritsar, after appreciating the evidence on record, held that the order dated 16.3.1990 passed by the senior superintendent of police, amritsar, was illegal, null and void and accordingly passed a decree in favour of the respondent that he would continue in service and was entitled to his pay, powers, privileges and other service benefits of the post of a constable. the appeal preferred by the appellants was dismissed by the additional district judge on 28.5.1994 and the decree of the trial court was affirmed. the appellants then preferred a second appeal in the high court, which was also dismissed on the finding that the respondent was thrown out of job on the ground of absence from duty. absence from duty is a misconduct and it was a punishment which was imposed upon him without holding a formal inquiry as envisaged under rule 16.24(ix) of the rules. consequently the order of discharge dated 16.3.1990 was wholly illegal and contrary to law.4. learned counsel for the appellants has submitted that the respondent had been appointed on 4.8.1989 and he had not completed three years of service and, therefore, he was only a probationer in terms of the rules. the impugned order is neither stigmatic nor it affects him with any evil consequences, as it only uses the expression that the respondent is not likely to become an efficient police officer. the rules confer power upon the appointing authority to discharge a probationer without holding any inquiry if he forms an opinion that the constable is not likely to become an efficient police officer. the learned counsel further submitted that no disciplinary action had been taken against the respondent and as such there was no necessity of holding any formal inquiry wherein the delinquent employee is afforded an opportunity to defend himself.5. the learned counsel for the respondent has, on the other hand, submitted that the impugned order of discharge dated 16.3.1990 though apparently looks to be innocuous but had in fact been passed on the ground of misconduct, viz., the absence from duty w.e.f. 22.2.1990 and, therefore, it is founded upon an act of misconduct. he has further submitted that the aforesaid misconduct being the foundation of the order, it was obligatory upon the appointing authority to have held a formal departmental inquiry wherein the respondent would have got an opportunity to defend himself6. rule 12.21 of the rules reads as under: -'a constable who is found unlikely to prove an efficient police officer may be discharged by the superintendent at any time within three years of enrolment. there shall be no appeal against an order of discharge under this rule.'7. a full bench of punjab and haryana high court in sher singh v. state of haryana and ors. : [1991]1scr1 , has examined the content and scope of rules 12.21, 19.3 and 19.5 of the rules in considerable detail. it has been held in that case that the effect of the rules is that for a period of three years a constable is under surveillance. he is being watched and is kept in close supervision. he has no right to the post and his services are terminable at any time during this period of three years. he can secure his position in the service only if he convinces the superintendent of police that he is likely to prove an efficient police officer. the full bench has further held that the rules contained the necessary guidelines for the superintendent of police, on the basis of which, he has to form an opinion regarding a constable. if on a consideration of the relevant material, the superintendent of police finds that a particular constable is not active, disciplined, self-reliant, punctual, sober, courteous or straight-forward or that he does not possess the knowledge or the technical details of the work required of him, he can reasonably form an opinion that he is not likely to prove an efficient police officer. in such a situation the superintendent of police can invoke his power under rule 12.21 and can discharge the constable from the force. we are in agreement with the view taken by the full bench of the high court. in fact, this view is in consonance with the decision of this court rendered in the superintendent of police, ludhiana and anr. v. dwarka das : [1979]2scr405 , where it was observed that if rules 12.21(3) and 12.21 are read together, it will appear that the maximum period of probation in the case of a police officer of the rank of constable is three years, for the superintendent of police concerned has the power to discharge him within that period. it was also held that the power of discharge cannot be exercised under rule 12.21 after the expiry of the period of three years and consequentially if it is proposed to deal with an inefficient police officer after the expiry of that period, it is necessary to do so in accordance with chapter xvi of the rules, which makes provisions for the imposition of various punishments including dismissal from the police force. no simple order of discharge under rule 12.21 can be passed after the expiry of the period of three years for that will attract article 311 of the constitution.8. termination of service of a probationer during or at the end of period of probation will not ordinarily and by itself be a punishment because the servant so appointed has no right to continue to hold such a post any more than a servant employed on probation by a private employer is entitled to. the period of probation, therefore, furnishes a valuable opportunity to the master to closely observe the work of the probationer and by the time the period of probation expires to make up his mind whether to retain the servant by absorbing him in regular service or dispense with his service. period of probation may vary from post to post or master to master and it is not obligatory on the master to prescribe a period of probation. it is always open to the employer to employ a person without putting him on probation. power to put the employee on probation for watching his performance and the period during which the performance is to be observed is the prerogative of the employer. (see ajit singh and ors. etc. v. state of punjab and anr. : (1983)illj410sc )9. the learned counsel for the respondent has submitted that the court should unveil the cloak and go behind the order dated 16.3.1990, which had in fact been passed on the ground of continued absence from duty of the respondent w.e.f. 22.2.1990 and as the said order was founded upon an act of misconduct, the order of discharge was in fact an order of dismissal by way of punishment and since no formal inquiry had been held and the respondent had not been given an opportunity of defending himself, the impugned order is wholly illegal and is liable to be struck down. in support of his submission learned counsel has placed reliance on hardeep singh v. state of haryana and ors. : [1987]3scr1138 . in this case the appellant hardeep singh had joined the police service in haryana in 1979 and became a member of an unregistered haryana police association, which had been canvassing for improvement in the service conditions of the police personnel serving with the haryana police and on several occasions made representations for improvement of service conditions. as part of its campaign the association gave a call in the month of july to all its members to participate in 'a non-taking of food campaign', which took place on 15.8.1982. on that day the appellant and 16,000 other constables and head constables attended to their duties but they did not take their food in the mess. the state government issued order of dismissal/removal against 425 policemen under rule 12.21 of the rules without serving any charge-sheet. the writ petition filed by 154 such policemen was allowed by this court. the appellant filed a writ petition in the high court which was dismissed. on thorough examination of the written statement filed by the state of haryana and the facts of the case this court came to a finding that the order of discharge was passed by way of punishment on account of his union activities, specially those participating in the call for expressing the protest of the association for improvement in service conditions by abstaining from taking meals in the mess on 15.8.2002, and that it was not a simple order of discharge. the court specifically held that on the facts and circumstances of the case it could not be said that the order of discharge was an order simpliciter of removal from service of a probationer in accordance with the terms and conditions of the service, as it tantamount to dismissal from service by reason of misconduct. in our opinion, this authority can be of no assistance to the respondent in view of the conclusion drawn by this court that the order had been passed on account of the union activities of the employee and his participation in the call for expressing the protest.10. the other case relied upon by the learned counsel for the respondent is state of uttar pradesh and anr. v. kaushal kishore shukla : [1991]1scr29 . in this case the employee kaushal kishore shukla was appointed on ad hoc basis for fixed period on 18.2.1977 as assistant auditor, which was extended on several occasions and the last extension was granted on 21.1.1980 which was to expire on 28.2.1981. his services were terminated on 23.9.1980. the termination order was challenged on the ground that certain allegations of misconduct had been made against him regarding which an ex parte inquiry was held wherein he was not given any opportunity of hearing. these allegations were also referred to in the counter affidavit, which was filed on behalf of the state before the high court. it was submitted that the order of termination of service was founded on the allegations of misconduct and the ex parte inquiry report. the high court accepted the plea of the employee and quashed the termination order. the appeal filed by the state was allowed by this court and the order of the high court was set aside with the following observations: -'the respondent being a temporary government servant had no right to hold the post, and the competent authority terminated his services by an innocuous order of termination without casting any stigma on him. the termination order does not indict the respondent for any misconduct. the inquiry which was held against the respondent was preliminary in nature to ascertain the respondent's suitability and continuance in service. there was no element of punitive proceedings as no charges had been framed, no inquiry officer was appointed, no findings were recorded, instead a preliminary inquiry was held and on the report of the preliminary inquiry the competent authority terminated the respondent's services by an innocuous order in accordance with the terms and conditions of his service. mere fact that prior to the issue of order of termination, an inquiry against the respondent in regard to the allegations of unauthorized audit of boys fund was held, does not change the nature of the order of termination into that of punishment as after the preliminary inquiry the competent authority took no steps to punish the respondent, instead it exercised its power to terminate the respondent's services in accordance with the contract of service and the rules. the allegations made against the respondent contained in the counter-affidavit by way of defence filed on behalf of the appellants also do not change the nature and character of the order of termination.'11. in s.p. vasudeva v. state of haryana and ors. : [1976]2scr184 , it was held that where an order of reversion of a person who had no right to the post, does not show ex facie that he was being reverted as a measure of punishment or does not cast any stigma on him, the courts will not normally go behind that order to see if there were any motivating factors behind that order. in bishan lal gupta v. state of haryana and ors. : (1978)illj316sc , it was held where the intention behind an inquiry against a probationer was not to hold a full departmental trial to punish but a summary inquiry to determine only suitability to continue in service of the probationer and the probationer was given ample opportunity to answer in writing whatever was alleged against him in show cause notices, the innocuous order of termination following such summary inquiry could not be said to be an order of punishment which entitled him to a full-fledged inquiry contemplated by article 311 of the constitution. in oil and natural gas commission v. dr. md. s. iskander ali : (1980)iillj155sc , it was held as under: -'where the short history of the service of the probationer appointed in a temporary post clearly showed that his work had never been satisfactory and he was not found suitable for being retained in service and that was why even though some sort of an enquiry was started, it was not proceeded with and no punishment was inflicted on him and in these circumstances, if the appointing authority considered it expedient to terminate the services of the probationer it could not be said that the order of termination attracted the provisions of article 311, when the appointing authority had the right to terminate the service without assigning any reasons.'these are all decisions by benches of three learned judges.12. the same question was considered in considerable detail in state of maharashtra v. veerappa r. saboji : (1979)iillj393sc and it was observed as under: -'ordinarily and generally the rule laid down in most of the cases by this court is that you have to look to the order on the face of it and find whether it casts any stigma on the government servant. in such a case there is no presumption that the order is arbitrary or mala fide unless a very strong case is made out and proved by the government servant who challenges such an order.'in governing council of kidwai memorial institute of oncology, bangalore v. dr. pandurang godwalkar and anr., : (1993)illj308sc , the same principle was reiterated and it was held that where 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 issuance of order of termination it really amounted to his removal from service on a charge, as such penal in nature.13. in ravindra kumar misra v. u.p. state handloom corporation ltd. and anr. : (1988)illj73sc , the appellant had been appointed on 30.10.1976 and had got two promotions while still working in temporary status and by 1982 he had been working as deputy production manager. on 22.11.1982 he was placed under suspension and the suspension order recited that as a result of preliminary inquiries made by the central manager it had come to notice that the appellant was responsible for misconduct, dereliction of duty, mismanagement and showing fictitious production of terrycot cloth. the suspension order was revoked on 1.2.1983 and thereafter on 10.2.1983 a simple order terminating his services was passed reciting that his services were no more required and his service would be deemed to be terminated from the date of receipt of the notice. it was further mentioned therein that he would be entitled to receive one month's salary in lieu of notice period. the termination order was challenged by the appellant on the ground that the same was punitive in nature, which was also demonstrated from the fact that shortly before the order of termination a suspension order had been passed wherein a specific charge of misconduct against him was mentioned. after referring to several earlier decisions this court repelled the challenge made by the employee by observing as under in paragraph 6 of the report: -'................in several authoritative pronouncements of this court, the concept of 'motive' and 'foundation' has been brought in for finding out the effect of the order of termination. if the delinquency of the officer in temporary service is taken as the operating motive in terminating the service, the order is not considered as punitive while if the order of termination is founded upon it, the termination is considered to be a punitive action. this is so on account of the fact that it is necessary for every employer to assess the service of the temporary incumbent in order to find out as to whether he should be confirmed in his appointment or his services should be terminated. it may also be necessary to find out whether the officer should be tried for some more time on temporary basis. since both in regard to a temporary employee or an officiating employee in a higher post such an assessment would be necessary, merely because the appropriate authority proceeds to make an assessment and leaves a record of its views, the same would not be available to be utilized to make the order of termination following such assessment, punitive in character.'14. in krishnadevaraya education trust and anr. v. l.a. balakrishna : [2001]1scr387 , it was held that a probationer is on test and if his services are found not be satisfactory, the employer has, in terms of the letter of appointment, the right to terminate the services. the mere fact that in response to the challenge the employer states that the services were not satisfactory, would not ipso facto mean that the services of the probationer were terminated by way of punishment.15. pavanendra narayan verma v. sanjay gandhi pgi of medical sciences and anr. : (2002)illj690sc , is a recent decision of this court where, after referring to large number of earlier decisions, the law on the point has been very clearly elucidated in the following manner :-'one of the judicially evolved tests to determine whether in substance an order of termination is punitive is to see whether prior to the termination there was (a) a full-scale formal enquiry (b) into allegations involving moral turpitude or misconduct which (c) culminated in a finding of guilt. if all three factors are present the termination has been held to be punitive irrespective of the form of the termination order. conversely if any one of the three factors is missing the termination has been upheld...........................................................................................generally speaking when a probationer's appointment is terminated it means that the probationer is unfit for the job, whether by reason of misconduct or ineptitude, whatever the language used in the termination order may be. although strictly speaking, the stigma is implicit in the termination, a simple termination is not stigmatic. a termination order which explicitly states what is implicit in every order of termination of a probationer's appointment, is also not stigmatic. in order to amount to a stigma, the order must be in a language which imputes something over and above mere unsuitability for the job.'16. state of punjab and ors. v. balbir singh : (2004)11scc743 , is a direct case on rule 12.21 of the rules. here also after considering large number of earlier decisions the court laid down the following principle: -'the order of discharge simpliciter, prima facie, is not punitive, it being in terms of punjab police rule 12.21 but the question still is whether the incident which led to the passing of that order was motive or inducing factor or was the foundation of order of discharge.in order to determine whether the misconduct is motive or foundation of order of termination, the test to be applied is to ask the question as to what was the 'object of the enquiry'. if an enquiry or an assessment is done with the object of finding out any misconduct on the part of the employee and for that reason his services are terminated, then it would be punitive in nature. on the other hand, if such an enquiry or an assessment is aimed at determining the suitability of an employee for a particular job, such termination would be termination simpliciter and not punitive in nature. the other test to determine whether, in substance, the order of discharge is punitive in nature is to ascertain the 'nature of enquiry' i.e. whether the termination is preceded by a full-scale formal enquiry into allegations involving misconduct on the part of the respondent, which culminated in the finding of guilt, and the 'purpose of the enquiry' i.e. whether the purpose of the enquiry is to find out any misconduct on the part of the employee or it is aimed at finding out as to the respondent being unlikely to prove as an efficient police officer.'17. the learned counsel for the respondent has also placed reliance on smt. rajinder kaur v. state of punjab and anr. : (1986)illj93sc , which is a decision by a bench of two learned judges. in this case the appellant was appointed as a lady constable on 7.5.1979 and after completion of training she was posted in the police lines in march, 1980. the superintendent of police, hoshiarpur, discharged the appellant by order dated 9.9.1980 under rule 12.21 of the rules. the order of discharge read as under: -'lady constable rajinder kaur no. 732 is unlikely to prove an efficient police officer. she is, therefore, hereby discharged from the police force under punjab police rules 12.21 with effect from today (september 9, 1980).issue order in o.r. and all concerned to notice and necessary action.'the main contention on behalf of the appellant was that an inquiry was made by the deputy superintendent of police as to the character of the appellant into the allegation that she stayed at mahalpur for one or two nights with one constable jaswant singh and evidence was recorded therein without giving the appellant any opportunity of hearing or to cross-examine the witnesses and the impugned order was made after completion of the investigation on the ground of her misconduct which cast a stigma on her service career. this contention was accepted and on the finding that though the order of discharge stated to be made in accordance with the provisions of rule 12.21 of the rules, it was really made on the basis of the misconduct as found on inquiry into the allegation behind her back and further that though the order was couched in innocuous terms, the order was merely camouflage for an order of dismissal from service on the ground of misconduct, the impugned order of discharge was set aside. with respects we are unable to agree with the view taken in this case. as discussed earlier the consistent view of this court is that even if some kind of preliminary inquiry or fact finding inquiry is held in which the employee is not afforded an opportunity of hearing, the order of discharge of a probationer cannot be treated as an order of punishment as the appointing authority has to necessarily ascertain all the relevant facts before taking a decision whether the probationer should be retained in service or not. the decision in smt. rajinder kaur v. state of punjab is hereby over-ruled.18. it must be borne in mind that no employee whether a probationer or temporary will be discharged or reverted, arbitrarily, without any rhyme or reason. where a superior officer, in order to satisfy himself whether the employee concerned should be continued in service or not makes inquiries for this purpose, it would be wrong to hold that the inquiry which was held, was really intended for the purpose of imposing punishment. if in every case where some kind of fact finding inquiry is made, wherein the employee is either given an opportunity to explain or the inquiry is held behind his back, it is held that the order of discharge or termination from service is punitive in nature, even a bona fide attempt by the superior officer to decide whether the employee concerned should be retained in service or not would run the risk of being dubbed as an order of punishment. the decision to discharge a probationer during the period of probation or the order to terminate the service of a temporary employee is taken by the appointing authority or administrative heads of various departments, who are not judicially trained people. the superior authorities of the departments have to take work from an employee and they are the best people to judge whether an employee should be continued in service and made a permanent employee or not having regard to his performance, conduct and overall suitability for the job. as mentioned earlier a probationer is on test and a temporary employee has no right to the post, if mere holding of an inquiry to ascertain the relevant facts for arriving at a decision on objective considerations whether to continue the employee in service or to make him permanent is treated as an inquiry 'for the purpose of imposing punishment' and an order of discharge or termination of service as a result thereof 'punitive in character', the fundamental difference between a probationer or a temporary employee and a permanent employee would be completely obliterated, which would be wholly wrong.19. in the present case neither any formal departmental inquiry nor any preliminary fact finding inquiry had been held and a simple order of discharge had been passed. the high court has built an edifice on the basis of a statement made in the written statement that the respondent was habitual absentee during his short period of service and has concluded therefrom that it was his absence from duty that weighed in the mind of senior superintendent of police as absence from duty is a misconduct. the high court has further gone on to hold that there is direct nexus between the order of discharge of the respondent from service and his absence from duty and, therefore, the order discharging him from service will be viewed as punitive in nature calling for a regular inquiry under rule 16.24 of the rules. we are of the opinion that the high court has gone completely wrong in drawing the inference that the order of discharge dated 16.3.1990 was, in fact, based upon the misconduct and was, therefore, punitive in nature, which should have been preceded by a regular departmental inquiry. there cannot be any doubt that the respondent was on probation having been appointed about eight months back. as observed in ajit singh and ors. etc. v. state of punjab and anr. (supra) the period of probation gives time and opportunity to the employer to watch the work ability, efficiency, sincerity and competence of the servant and if he is found not suitable for the post, the master reserves a right to dispense with his service without anything more during or at the end of the prescribed period, which is styled as period of probation. the 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. therefore, the high court was clearly in error in holding that the respondent's absence from duty was the foundation of the order, which necessitated an inquiry as envisaged under rule 16.24(ix) of the rules.20. for the reasons discussed above, we are of the opinion that the view taken by the high court and also by the lower courts is wholly erroneous in law and must be set aside. the appeal is accordingly allowed and the judgment and decree passed by the high court and also by the learned sub-judge and learned additional district judge are set aside. the suit filed by the plaintiff-respondent is dismissed.21. no costs.