RADHEY SHYAM GUPTA versus U.P. STATE AGRO INDUSTRIES CORPORATION LTD. AND ANR.

Citation: [1998] SUPP. 3 S.C.R. 558 · Decided: 15-12-1998 · Supreme Court of India · Bench: K. VENKATASWAMI · Disposal: Appeal(s) allowed

Judgment (excerpt)

A 
B 
RAD HEY SHY AM GUPTA 
v. 
U.P. STATE AGRO INDUSTRIES CORPORATION LTD. AND ANR. 
Dl1CEMBER, I .S 1998 
[K. VENKATASWAMI AND M. J,\\GANNADHA RAO, JJ.] 
Service Law: 
Termination of service-Temporary employee/probationer-Simpliciter 
C or punitive-If the motive behind the preliminary enquiry is not to determine 
the misconduct but merely to decide the question of retention in service, the 
termination is not punitive-In such cases the departmental enquiry be 
dropped at any stage before recording of evidence and an order of termination 
simpliciter passed-No .stigma is attached thereby-Departmental enquiry---
D Non completion of enquiry before the stage of recording evidence and passing 
termination order simpliciter-Effect of 
Termination of serviceS-Simp/iciter or punitive-Test to determine-
Temporary employee-Holding of enquiry behind the back of the employee-
. Test is whether it serves as a motive or foundation of the terminatio1l-Court 
E can go behind the order for this purpose-If the purpose of the enquiry is 
not to find out the truth of the a/legations of misconduct but to decide 
whether to retain the employee against whom a cloud is raised on his 
conduct. Such enquiry only serves as a motive for the termination-But 
where the enquiry is held at the back of the employee on the basis of the 
evidence where a definite finding is reached about the misconduct of an 
F employee and if such finding forms the basis or foundation of the order of 
termination, such order would be punitive and against the principles of 
natural justice. 
G 
Words and phrases-'Motive' and foundation', in the context of 
departmental enquiry under labour law and service jurisprudence. 
The appellant was working in the respondent-Corporation as a Branch 
Manager. He was asked to submit his explanation in respect of allegation of 
having fraudulently taken Rs. 2000 from the complainant. The respondent 
f!either conducted any disciplinary enquiry nor any oral enquiry in the 
presence of the appellant. The enquiry officer examined the witnesses and 
II 
558 
.. 
R.S. GUPTA v. U.P. STA TE AGRO INDUS. CORPN. LTD. 
559 
submitted his report without issuing any charge memo or giving a hearing. A 
In his report, the enquiry officer concluded that the appellant had taken· a 
sum of Rs. 2000 from the complainant and thereafter recommended that the 
services of the appellant be terminated. The very next day a simple order of 
termination was passed in terms of the appointment order stating that his 
services were being terminated with immediate effect on payment of one B 
month's salary in lieu of notice. The Administrative Tribunal allowed the 
appellant's application challenging the termination order declaring it to be 
violative of principles of natural justice. The High Court, on appeal by the ' 
respondent, held that the enquiry was conducted "to assess the work" of the 
appellant as it was decided to dispense with his temporary service in terms 
of Condition No. 3 of the order of appointment, which permitted such C 
termination on payment of one month's salary or after giving one month 
notice. And that was why a simple order of termination was passed and it did 
not cause any stigma inasmuch as it did not refer to any disciplinary inquiry. 
The High Court also held that there was "sufficient material" to indicate the 
unsatisfactory work and conduct of the appellant. Hence this appeal. 
D 
Allowing the appeal, this Court 
HELD: 1.1. The termination of the services of a temporary servant or 
one on probation, on the basis of adverse entries or on the basis of an 
assessment that his work is not satisfactory will not be punitive in as much E 
as the above facts are merely the motive and not the foundation. The reason 
why they are the motive is that the assessment is not done with the object 
of finding out any misconduct on the part of the officer. It is done only with 
a view to decide whether he is to be retained or continued in service. The 
position is not different even if a preliminary enquiry is held because the 
purpose of a preliminary enquiry is to find out if there is prima facie F 
evidence or material to initiate a regular departmental enquiry. The purpose 
of the preliminary enquiry is not to find out misconduct on the part of the 
officer and if a termination follows without giving an opportunity, it will not 
be bad. Even in a case where a regular departmental enquiry is started, a 
charge-memo issued, reply obtained and

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