Full Judgment Text
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 1 of 16
PETITIONER:
AJIT SINGH & OTHERS ETC.
Vs.
RESPONDENT:
STATE OF PUNJAB & ANOTHER
DATE OF JUDGMENT10/03/1983
BENCH:
DESAI, D.A.
BENCH:
DESAI, D.A.
ERADI, V. BALAKRISHNA (J)
CITATION:
1983 AIR 494 1983 SCR (2) 517
1983 SCC (2) 217 1983 SCALE (1)262
CITATOR INFO :
RF 1989 SC1160 (30)
D 1992 SC2093 (17)
ACT:
Civil service-Service rule prescribed probation of two
years-order of appointment stated probation as one year-
Government, if competent prescribe shorter period of
probation.
Probation-Meaning or-object in prescribing.
Interpretation-Manadatory or directory-Tests for
determining.
HEADNOTE:
The Punjab Town Improvement Act, 1922 envisages the
setting up of Trusts and the Trusts so set up were to be
bodies corporate with perpetual succession and a common
seal. The duties and functions entrusted to the Trusts
included, among others, preparation of schemes for
improvement and expansion of towns in the State. For the
purpose of manning the senior posts under tho Trusts, the
Act conferred power on the State Government to constitute
certain services. One of the services constituted by the
Government was the Punjab Service of Trust Executive
officers. Exercising power under the Act the State
Government framed the Punjab Trust Services (Recruitment and
Conditions of Service) Rules, 1978, The Rules envisaged the
setting up of a Selection Committee called the Punjab Trust
Services Selection Committee for selecting officers. After
following the procedure prescribed under the Rules, the
Selection Committee recommended the appointment of the
eleven petitioners herein to the posts of Trust Executive
officers, Class 1, II and II[. The Slate Government accepted
the recommendations of the Selection Committee and in May,
1979 appointed the petitioners to the respective posts.
Condition (c) of the terms and conditions annexed to the
order of appointment issued to each of the appointees
stated: "All the appointees shall remain on probation for a
period of one year under rule 10(1) of the Rules. The
regular appointments shall be subject to the satisfactory
completion of the period of probation by such appointee
after the expiry of one year & on the date of his joining on
the completion of one year of service an increment was
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 2 of 16
released in favour of each of the appointees.
In August, 1980 tho State Government dissolved 21
Trusts. Purporting to act under rule 9 of the 1978 Rules,
the Governor dispensed with immediate effect the services of
each of the 11 petitioners after paying a month’s salary in
lieu of a month’s notice.
518
In their petitions filed under Article 32 of the
Constitution impugning the order of the State Government
dispensing with their services! the petitioners alleged that
after they had satisfactorily completed the period of
probation of one year it was not open to tho State
Government to dispense with their services; the power to
dissolve the Trusts was used by the Government to get rid of
the petitioners; that sometime after dispensing with their
services the Trusts had been reconstituted but even so they
had not been recalled to their posts and that the action of
the Government in the case was thoroughly arbitrary,
actuated by extraneous considerations.
In reply it was stated that under rule 9 (2) the State
Government had power to dispense with the services of a
probationer if his work and conduct during the period of
probation were not satisfactory; payment of a month’s pay in
lieu of notice was made by way of abundant caution and that
it could not confer any right on the petitioners; the period
of probation of one year, mentioned in clause (c) of the
annexure to the order of appointment was a typographical-cum
clerical error, which in terms of rule 9 (2) should have
been two years in respect of direct recruits and lastly
their services had been dispensed with because with the
dissolution of the Trusts the Executive officers had become
surplus and their continuance in service would be an
avoidable burden on the exchequer.
It was contended on behalf of the State Government that
the expression ’shall’ in rule 9 (I ) on its own force would
apply so that the direct recruits would automatically be on
probation for a period of two years and no power or discre-
tion is conferred on anyone to reduce this period.
Allowing petition,
^
HELD: It is not necessary to prescribe a period of
probation and the State Government as the appointing
authority would have discretion in the matter subject to
rules by which the appointment is governed. [529 C]
Under the archaic law of hire and fire the concept of
probation in service jurisprudence was practically absent;
but with the advent of the concept of security in public
service it came to acquire a certain connotation. In order
that an incompetent or inefficient servant is not foisted
upon the master the concept of probation was devised. A new
recruit is put on test for a period before be is absorbed in
the service or has acquired a right to the post. In so far
as the master is concerned the period of probation gave a
sort of locus pententaie to him to observe the work,
ability, efficiency, sincerity and competence of the servant
and if the servant is not found suitable for the post the
master reserved the right to dispense with his service
during or at the end of the period of probation. The period
of probation, therefore, furnished a valuable opportunity to
the master to closely observe the work of a probationer. The
termination of service of a probationer during or at the and
of the probation did not ordinarily and by itself constitute
a punishment for, the servant had no right to continue to
hold such a post. The period of probation may vary from post
to post or from master to master. It is not obligatory on
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 3 of 16
the part of the master to prescribe a period of probation;
it is open to him to employ a person without putting him on
probation. In short the power to keep a servant on probation
and the period during which his performance is to be
observed remained tho prerogative of the master.
[526 A-H]
519
Purshottam Lal Dhingra v. Union of India [1958] SCR 828,
followed.
There is no general rule which may help in determining
whether a provision is mandatory or directory. It is the
duty of the court to try to get at the real intention of the
Legislature by carefully attending to the whole scope of the
statute to be construed. The use of the expression ’shall’
is not decisive and the question whether a provision is
mandatory or directory depends upon the intent of the
Legislature and not upon the language in which the intent is
clothed. [527 G-H]
Cullimore v. Lyme Rogis Corporation, [1962] I Q.B. 718;
State of U.P. & Ors. v. Babu Ram Upadhaya, [1961] 2 SCR 679
at 710; State of U.P. v. Manbodhan Lal Srivastava, [1958] 2
SCR 533 and Montreal Street Railway Company v. Normandin,
L.R. [1917] A.C. 170, referred to.
Rule 9 (2) is directory and confers a discretion on the
State Government to prescribe a period of probation shorter
than the maximum set out in it. The period of two years
prescribed in this rule is the maximum period which means
that the rule placed an embargo on the appointing
authority’s right to prescribe a period of probation longer
than two years. But the rule does not admit of a
construction that a period shorter than two years could not
be prescribed. The rule enables the appointing authority to
determine the suitability of the person appointed and the
State Government may, having regard to the biodata and other
information it has about the officers, feel that a period
shorter than two years would suffice to make up its mind
whether to retain him in service or to dispense with his
service. Power in this respect is vested in the State
Government which is the highest authority and that power has
to be exercised on the recommendation of a statutory body.
This power is not taken away by the use of the expression
’shall’ in the rule. [527 C-F]
In the instant case two of the petitioners who were
appointed to class I post possessed high educational
qualifications, had considerable experience in the education
department of the State and left the permanent service under
the State to take up the present jobs. Persons of such long
experience and high qualifications would be disinclined to
be put on probation again for a period of two years. It is
therefore reasonable to infer that, having regard to the
high attainments of tho candidates, the State Government had
prescribed a period of probation of one year. A few other
petitioners, who were appointed to class II and Ill posts
were practising advocates. In all the cases, on the
completion of the period of probation of one year they were
given an increment which is released only if the work and
conduct of the person are found to be satisfactory. It is
implicit in this that they bad satisfactorily discharged
their duties during the period of probation. In the face of
this position to hold that the wording of the appointment
order stating that each of the appointees would be on
probation for one year was a typographical-cum-clerical
error, would be doing violence to commonsense.
[525 B-E, 529 C-F]
That the dissolution of the Trusts was a device to get
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 4 of 16
rid of tho petitioners is evident from later events. By the
very order by which the Trusts were dissolved certain
officers were appointed to carry on the functions of the
Trusts. Therefore the Trusts, independent of the Board of
Trustees, had a corporate personality, with a perpetual
succession and their functions had to be carried out. The
520
effect of the dissolution was me rely to dissolve the Board
of Trustees. The corporate personality of the Trust remained
inviolate. If the Trusts were functioning, if their schemes
were being implemented, if all other staff was retained
there is no substance in the contention that the services of
the petitioners alone were no longer required because of the
dissolution of Trusts. Even if the charge of mala fide is
not true there are certain aspects which unerringly point in
the direction that the action was arbitrary and is violative
of Articles 14 and 16 of the Constitution. [535 A-E]
There is equally no force in the contention that after
the dissolution of the Trusts their continued retention in
service was imposing an unnecessary burden on the State
exchequer. After removing the petitioners 11 other officers
were asked to take over their duties. This apart, the State
exchequer was not responsible for the salary and prequisites
of the Trust Executive officers; their salaries, allowances
and prequisites were charged on the fund of the Trusts as
envisaged by section 17 (4) of the Act. [534 A]
The argument that the performance of the petitioners
was not satisfactory is equally untenable. On the expiry of
the period of probation they were allowed an increment and
were continued in service. It would be unjust to say that
their work was unsatisfactory till they earned their
increments but that their work and ) conduct were found to
be unsatisfactory within less than six weeks thereafter,
meriting dispensing with their services. [530 B- D]
JUDGMENT:
ORIGINAL JURISDICTION . Writ Petition (Civil) Nos.
5274-81, 5463, 5348 & 5606 of 1980.
(Under article 32 of the Constitution cf India)
M.K. Ramamurthi, J. Ramamurthy, Miss R. Vaigui for the
Petitioners.
Hardyal Hardy and D.D. Sharma for the Respondents
The Judgment of the Court was delivered by
DESAI, J. These writ petitions under Article 32 of the
Constitution questioned the validity of the orders
dispensing with service of each of the petitioner with
immediate effect made by the Director Local Government.
Punjab dated September 25, 1980 as being violative of Arts.
14 and 16 of the Constitution.
The Punjab Town Improvement Act, 1922 (’Act for short)
was enacted to make provision for the improvement and
expansion of towns in Punjab. The act envisages the creation
and constitution of Trusts and the Trust so created will
have a corporate personality with perpetual succession and a
common seal. The duties and functions
521
of the Trust inter alia include preparing of schemes under
the Act for various purposes. Section 17 conferred power on
the State Government to constitute certain services in the
manner therein prescribed. One such service contemplated by
the section was Punjab Service of Trust-Executive officers.
Sub-section (2) of section 17 conferred power on the State
Government to make rules for regulating the recruitment and
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 5 of 16
the conditions of service of members of the Trust Services
constituted by the State Government. Armed with this power,
the State Government constituted Punjab Service of Trust
Executive officers. In exercise of the power conferred by
sec. 73 read with sec. 17 (2) of the Act, the State
Government framed rules styled as Punjab Trust Services
(Recruitment and Conditions of Service) Rules, 1978 (Rules’
for short). Rule 5 (2) (i) inter alia provided that fifty
percent of the vacancies in the cadre of Executive officers
shall be filled by direct recruitment and for this purpose
rule 5(4) envisaged the setting up of a Selection Committee
called Punjab Trust Services Selection Committee.
In the year 1978, Directorate of Local Government,
Punjab issued advertisement No. 1078 inviting applications
for the posts in Class I, II and III of Trust Executive
officers Pursuant to this advertisement, large number of
persons applied for various posts. The Punjab Trust Services
Selection Committee interviewed various candidates and
ultimately recommended eleven persons for the post of Trust
Executive officers. Ajit Singh and Rajinder Singh were
recommended for Class I post; S. Sarup Singh and R.L. Bhagat
were recommended for Class II Post of Trust Executive
officers and the remaining 7 petitioners in this group of
petitions were recommended for Class III Post of Trust
Executive officers. These recommendations were accepted and
appointment orders were issued by Punjab Government on May
28, 1979 and it is not in dispute that all the appointees
joined the respective posts. Each one of the appointees was
issued an order of appointment to which terms and conditions
of appointment were annexed. One such condition worth-
noticing reads as under:
"(c) All the appointees shall remain on probation
for a period of one year under rule 10 (l) of the
Rules. The regular appointments shall be subject to the
satisfactory completion of the probation period by such
appointee after the expiry of one year from the date of
his joining."
522
After each appointee completed one year of service, an
increment was released in his favour. Suddenly in exercise
of the power conferred by Rule 9 of the ’1978 Rules’,
Director of Local Government, Punjab dispensed with the
service of each of the 11 Trust Executive officers, who were
appointed on May 28, 1979. These orders are impugned in
these petitions.
As the language of the order was the subject matter of
some discussion, the one in respect of petitioner No. 3 R.L.
Bhagat may be extracted. It reads as under:
"Punjab Government
Local Government Department
O R D E R
In exercise of the powers conferred under Rule 9
of the Punjab Trust Services Recruitment and Conditions
of Service) Rules, 1978 and all other powers enabling
him in this behalf the Governor of Punjab is pleased to
dispense with immediate effect the services of Shri
Rattan Lal Bhagat who was appointed to the Punjab Trust
Service of Executive officer Class Il vide office order
No. DLG (TSC)-79/126 dated 28th May, 1979. He will be
paid one month’s salary in lieu of the month’s notice
Sd/- R.D. Joshi,
Director, Local Government, Punjab.
Endst. No. DLG (TSC) 80/8648/51 Dated Chandigarh the
25th Sept. 1980".
Validity of this order styled as order dispensing with
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 6 of 16
the service of each of the petitioner is questioned in this
group of petitions on The ground that the action is
thoroughly arbitrary actuated by extraneous considerations
and violative of equality of opportunity in tho matter of
employment. It is also challenged on the additional ground
that after the completion of the period of probation it was
not open to the State Government to terminate the service of
the petitioners, in the manner in which it is done. One more
ground of attack was that the action was malafide in that
the petitioners were appointed when a political party of
other hue and colour was in power and on a
523
change of Government, the petitioners were victimised. In
support of the last contention it was urged that the power
to dissolve trust conferred by section 103 was used to get
rid of the petitioners which can be demonstrably established
by the fact’s that after dispensing with the service of
petitioners, the trusts have been reconstituted without
calling back petitioners to their posts.
A return was filed on behalf of the respondents-the
State of Punjab and Director-cum-Joint Secretary, Local
Government Department, Punjab by Prithipal Singh Sodhi.
Apart from the usual preliminary objection that the petition
involves disputed and tangled questions of facts which
cannot be resolved under a petition under Article 32 of the
Constitution, it was contended that the Government had
dissolved all the 21 Improvement Trusts in the State of
Punjab by its order dated August 11, 1980 and since the
Trusts were dissolved, services of Executive officers were
no longer required because their continuance would inflict
an unnecessary burden on the State Exchequer and therefore,
the State Government decided to dispense with the services
of those Executive officers appointed by direct recruitment
who had not completed the probationary period of 2 years
under Rule 9 (1) of ’1978 Rules’. It was contended that all
the petitioners were appointed through direct recruitment as
Executive officers in the Punjab Trust Services on May 28,
1979 and according to the respondents the period of
probation was two years which would expire on May 27, 1981.
It was said that the State Government in exercise of the
power conferred by Rule 9 (2) could dispense with a service
of a probationer, if the work and conduct of a person to a
service during the period of his probation is in the opinion
of the appointing authority not satisfactory. Armed with
this power, it was contended that the services of the
petitioners were terminated which would mean that the work
and conduct of each of the petitioner who was appointed by
direct recruitment was not satisfactory. Explaining why one
month pay in lieu of notice was paid, it was contended that
payment was ex majorie cautela and it can confer no right on
the petitioners. Referring to clause (c) in the annexure to
the appointment order of the petitioners which prescribed a
probation period of one year, it was submitted that that was
a typographical-cum-clerical error because Rule 9 (2) which
prescribes period of probation in terms specifies the
probation period of two years in respect of direct recruits.
It was lastly contended that as the Trusts were dissolved,
the services of the petitioners as Executive officers had
become
524
surplus and therefore, had to the dispensed with as a
compelling necessity.
Pleadings have been set out in some detail to highlight
a very narrow controversy which requires to be resolved in
this case. There is no dispute that petitioners were
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 7 of 16
appointed to Class I, II and III post of Trust Executive
Service after they were recommended by the statutory body
called Punjab Trust Service Selection Committee. That each
petitioner in response to the appointment order dated May
28, 1979 joined the service is again undisputed. Terms and
conditions were set out as an annexure to the appointment
order of each of the petitioners and clause (c) in the
annexure clearly specifies the probation period to be of one
year as prescribed under Rule 10 (1) of ’1978 Rules.’ Now if
each of the petitioners was appointed as a probationer and
the period of probation which he was informed by the
annexure to the appointment order was of one year,
indisputably on May 27, 1980 each one completed the period
of probation. However, the contention of the respondents is
that the recital in clause (c) of the annexure to the
appointment order specifying the probation period of one
year in respect of each petitioner is a typographical-cum-
clerical error in view of the provision contained in Rule 9
(1) of ’1978 Rules’. Rule 9 (1) and 9 (2) provide as under:
"9-Probation:-(1) A person appointed to a service
shall remain on probation for a period of two years, if
appointed by direct recruitment, and one year, if
appointed otherwise.
(2) if the work or conduct of a person appointed
to a service during the period of his probation is, in
the opinion of the appointing authority, not
satisfactory, it may;
(a) if appointed by direct recruitment, dispense
with his services."
It would thus appear at a glance that the real question
in controversy was what was the period of probation in
respect of each of the appointee. It is not in dispute nor
is it controverted by the respondents that the appointment
order issued by the Punjab Government did recite that the
person mentioned in the order is appointed to Punjab Trust
Services of Executive officers Class I or Class II or 111 as
the case may be subject to the conditions annexed to the
order etc. Therefore, the appointment was subject to the
conditions annexed to the order and as pointed out earlier
condition (c) annexed
525
to the order prescribes a period of probation of one year.
Nowhere A in the affidavit in opposition, the respondents
state as to whether rule 10 (1) also confers power to
prescribe a period of probation. Reference is to Rule 9 (1)
which prescribed a period of probation of two years for
those appointed by direct recruitment. Now examining the
matter from the point of view of petitioners, all the
petitioners were appointed by direct recruitment. But at
this stage one may point out that petitioner No. I Ajit
Singh, who was selected for Class I post of Trust Executive
officer, had 26 years of service to his credit in the
Education Department of Punjab Government and he had to
resign that post in order to take the post of Trust
Executive officer Class I. Similarly, Rajinder Singh-
petitioner No. 2, who was appointed to Class I post was
Class II Gazetted officer in Punjab Government service with
26 years of service to his credit till September 22, 1978.
He had also worked from September 22, 1978 to the date of
joining the post of Class I Trust Executive officer as
Executive officer Class II in the same Local Government
Department. Thus both Ajit Singh and Ravinder Singh who were
appointed to Class I post had rendered service for a long
time. Both were highly educated. Both had to leave permanent
service to take up the post of Trust Executive officer. R.L.
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 8 of 16
Bhagat, Pavittar Singh Gill, Gulam Sabir Ali Khan and
Harjinder Singh, who were directly recruited to Class II and
III posts of Executive officers were practising advocates.
If the Service Selection Board had the bio-data of each of
these persons before it, one can say with certain amount of
confidence that the Service Selection Committee as well as
the Punjab Government having taken into consideration such
high educational attainments and past experience may
prescribe a shorter period of probation. Mr. Hardy, learned
counsel for the respondents, however, seriously contended
that rule p 9(1) does not permit anyone to prescribe shorter
period of probation than the prescribed period of two years.
He relied on the use of the expression ’shall’ in Rule 9 (1)
as mandatory and submitted that even if the appointment
order did not carry any specification about the prescribed
period of probation, the rule on its own force will apply
and a direct recruit appointed to Trust Executive Service
and governed by the ’1978 Rules’ will automatically be on
probation for a period of two years. It was also pointed out
that the rules do not confer any power or discretion on many
authority to reduce this period. We find it difficult to
subscribe to this view.
This requires examination of the genesis why period of
probation is prescribed. And how the period of probation has
been understood in service jurisprudence.
526
When the master servant relation was govern ed by the
archaic law of hire and fire, the concept of probation in
service jurisprudence was practically absent. With the
advent of security in public service when termination or
removal became more and more difficult and order of
termination or removal from service became a subject matter
of judicial review, the concept of probation came to acquire
a certain connotation. If a servant could not be removed by
way of punishment from service unless he is given an
opportunity to meet the allegations if any against him which
necessitates his removal from service, rules of natural
justice postulate an enquiry into the allegations and proof
thereof. This developing master servant relationship put the
master on guard. In order that an incompetent or inefficient
servant is not foisted upon him because the charge of
incompetence or inefficiency is easy to make but difficult
to prove, concept of prohibition was devised. To guard
against error of human judgment in selecting suitable
personnel for service, the new recruit was put on test for a
period before he is absorbed in service or gets a right to
the post. Period of probation gave a sort of locus
pententiae to the employer to observe the work, ability,
efficiency, sincerity and competence of the servant and if
he is found not suitable for the post, the master reserved 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. Viewed from this aspect, the
courts held that termination of service of a probationer
during or at the end of a 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. (See Purshotam Lal Dhingra v. Union
of India.(1) The period of probation therefore furnishes a
l? 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
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 9 of 16
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.
527
Rule 9 (2) provides that a person appointed to a
service shall A remain on probation for a period of two
years if appointed by direct recruitment etc. Emphasis was
placed on the use of the expression ’shall’ and it was urged
that it is mandatory. It was also urged that the rule leaves
no discretion in the appointing authority to prescribe a
period of probation shorter than two years. And even if
someone has attempted to do the same that being clearly
illegal, the person concerned having been fastened with the
knowledge of the statutory rule cannot contend that his
period of probation is less than two years, and the court
will have to proceed on the basis that period of probation
shall be two years. This submission raises a vital question
whether the use of the expression ’shall’ in rule 9 (2)
indicates that the rule was to be mandatory in its
application and no one will have a discretion to prescribe a
period shorter than two years. On a plain grammatical
construction of the rule it appears clear that the
prescribed period of two years was the maximum period and
that placed an embargo on the appointing authority denying
it a right to prescribe a period of probation longer than
two years. But the rule does not admit of a construction
that a period shorter than two years cannot be prescribed.
The purpose underlying the rule was to give an opportunity
to the appointing authority, in this case the State
Government, to determine the suitability of the person
appointed and the State Government having the bio-data of
officers before it may feel that a period shorter than 2
years would suffice it to make up its mind whether to retain
the employee concerned or to dispense with his service. Rule
9 (2) is thus an enabling provision which permits the
Government to prescribe a period of probation and the period
can be anywhere up to two years and not in excess of 2
years. Such enabling provision is generally held to be
directory and not mandatory. The rule is cast in affirmative
language and there is no prohibition placed in public
interest. In order to determine whether a provision is
mandatory or directory, there is no general rule which may
help. It is the duty of Court to try to get at the real
intention of the legislature by carefully attending to the
whole scope of the statute to be construed. (See Cullimore
v. Lyme Regis Corporation. (1) The use of the expression
’shall’ is not considered decisive and the question whether
a provision is mandatory or directory depends upon the
intent of the Legislature and not upon the language in which
the intent it clothed. This Court in State of U.P. & Ors. v.
Babu Ram
528
Upadhaya,(l) after referring to Crawford "on the
Construction of Statutes", Craies on "Statute Law", Maxwell
on "The Interpretation of Statutes", State of UP. v.
Manbodhan Lal Srivastava(2) and Montreal Street Railway
Company v. Nirmandin,(3) briefly formulated the relevant
rules for interpretation as under:
"When a statute uses the word ’shall’, prima
facie, it is mandatory but the Court may ascertain the
real intention of the Legislature by carefully
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 10 of 16
attending to the whole scope of the statute. For
ascertaining the real intention of the Legislature, the
Court may consider inter alia, the nature and the
design of the statute and the consequences which would
follow from construing it the one way or the other, the
impact of other provisions whereby the necessity of
complying with the provisions in question is avoided,
the circumstance, namely, that the statute provides for
a contingency of the non-compliance with the
provisions, the fact that the non-compliance with the
provisions is or is not visited by some penalty, the
serious or trivial consequences that flow therefrom
and, above all, whether the object of the Legislation
will be defeated or furthered."
This rule of interpretation was re-affirmed recently in
Municipal Corporation of Greater Bombay v. B. E. S. T.
Workers Union(4). In order to ascertain whether rule 9(2) is
mandatory or directory, the setting in which it is placed,
the purpose under lying the provision, the object sought to
be achieved would help in determining whether it is
mandatory or directory. As we have pointed out above that
rule 9(2) was an enabling provision conferring power on the
State Government to put a person appointed by direct
recruitment on a probation of maximum period of two years
and no consequence or failure to comply with the same is
provided in the relevant rules, the provision appears to be
directory. Obviously, the appointing authority having regard
to all the circumstances may not be inclined to prescribe
any period of probation or may prescribe a shorter period of
probation. This power is not taken away by the use of the
expression ’shall’ in rule
529
9(2). And let it be remembered that the power of appointment
A is vested in the highest executive namely the State
Government and the power is to be exercised on the
recommendation of a statutory body. Viewed from all these
angles, it appears clear to us that rule 9(2) is directory
and confers a discretion on the State Government to
prescribe a period of probation shorter than the maximum set
out in rule 9(2).
Having clearly ascertained the purpose and intendment
underlying the concept of probationary period in service
jurisprudence, one can confidently say, that it is not
absolutely necessary to prescribe a period of probation in
each case and the State Government as an appointing
authority will have discretion in this matter subject to
rules by which appointment is governed, otherwise the rule
would be counter-productive. Highly qualified and
experienced persons coming into service at a later stage in
life like petitioners Ajit Singh and Rajinder Singh, who
after rendering service for a long period of 26 years came
to be appointed as direct recruits, would be disinclined to
be on a probation for a period of two years. And the
appointing authority, in this case the State Government, not
any lower officer, noting their worth and value may either
wholly dispense with the period of probation or reduce it
considerably. If such be the purpose and intendment
underlying the concept of probationary period, it is
reasonable to infer that in respect of such experienced and
highly qualified persons, the appointing authority the State
Government must have prescribed the period of probation of
one year. And that is why uniformly in each appointment
order, the appointee concerned was told that his period of
probation would be one year only. To hold with the
respondents that this is a typographical-cum-clerical error
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 11 of 16
is such over simplification as would be doing violence to
common sense. We are therefore, of the opinion that in case
of each of the appointee, the period of probation prescribed
was one year only.
This conclusion is buttressed by another circumstance
appearing in the record. When each of the petitioners
completed his one year of service, which marked the
expiration of the period of probation, an increment was
released in his favour. Subject to the specific rule to the
contrary, ordinarily no increment is earned during the
period of probation. But at any rate, if an increment can be
earned after the expiry of the period of probation, it would
depend upon the satisfaction of the appointing authority
that the
530
work and conduct of the probationer was satisfactory.
Further rule 4.7 of the Punjab Civil Service Rules Vol. 1
provides that an increment shall ordinarily be drawn as a
matter of course, unless it is withheld. An increment may be
withheld from a Government employee by a competent authority
if his conduct has not been good or his work has not been
satisfactory. Now almost all the petitioners completed their
one year service by June, 1980. An increment was released in
favour of each of them. lt is implicit in release of
increment that the petitioners had satisfactorily discharged
their duty during the probation period, and at any rate the
work and conduct was not shown to be unsatisfactory, which
permitted an increment to be earned. Assuming, as contended
for on behalf of the respondents that period of probation
was two years, the fact that on the expiry of one year of
service an increment was released, would imply that during
the period of one year the work and conduct has not been
unsatisfactory. If it was otherwise the release of increment
could have been interdicted on the ground that neither the
work nor the conduct was satisfactory. The fact that the
increment was released would atleast permit an inference
that there was satisfactory completion of the probation
period and that during the probationary period, the work and
conduct of each of the petitioner was satisfactory.
If up to the end of June, 1980, the work and conduct of
each of the petitioner was satisfactory and if the service
of each of them was simultaneously on the same day September
28, 1980 dispensed with on the ground mentioned in rule 9
(2) (a) in that in the opinion of the appointing authority,
the work and conduct of each of the petitioner was not
satisfactory, then between June 1 980 and September 1980
something was simultaneously done by each of the petitioners
to permit the appointing authority-the State to reach an
affirmative conclusion that the work and conduct, became
wholly unsatisfactory and the degree of dissatisfaction with
the service was so high that the service of all the 11
petitioners recruited on the same day was required to be
dispensed with on identical ground. This is too fortuitous
to carry conviction.
Mr. M.K. Ramamurthi, in this connection, contended that
there is no satisfactory explanation as to what suddenly
occurred in respect of all the 11 petitioners recruited on
the same day to render their otherwise satisfactory service
as unsatisfactory and that too during the short period after
release of increment ? Mr. Ramamurthi urged that between
recruitment and termination of service, the politi-
531
cal hue of the party in power changed. Maybe, there may be
some A substance in the contention, but for paucity of
evidence we are not inclined to examine this contention. We
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 12 of 16
would rather confine ourselves to the positive averment in
the return filed on behalf of the respondents for dispensing
with the service of all the petitioners. In Para 9 of the
return, following reasons are assigned for dispensing with
the services of the petitioners:
"The services of the petitioners have been
dispensed with and not terminated because :-
(i) They had not completed their period of
probation on the date of order;
(ii) Their services were no longer required
as the Improvement Trusts in the State of Punjab
had been dissolved;
(iii) Their Continuance in service was only
causing unnecessary burden to the State Exchequer;
(iv) They being probationers had no right to
the posts.
(v) Their performance, in the opinion of the
appointing authority, was not upto the mark."
We will meticulously examine the validity of each one
of these reasons seriatim.
The first submission is that each of the petitioners
had not completed the period of probation on the date of
impugned order. This proceeds on the assumption that the
period of probation was two years. For the reasons
hereinabove stated, this submission is contrary to the
record. If the period of probation was one year as held by
us, indisputably each one of the petitioners had completed
his period of probation on the date of the impugned order.
Therefore this reason is untenable and will have to be
ignored.
The second reason assigned for the impugned action was
that the services of the petitioners were no longer required
as the Improvement Trusts in the State of Punjab had been
dissolved. By an order dated August 11, 1980, Government of
Punjab in exercise of the power conferred by sec. 103 (1) of
the Act dissolved with immediate effect the trusts therein
set out. In all 21 Trusts were dissolved.
532
Each Trust had an Executive officer. If 21 Trusts were
dissolved, 21 Executive officers became surplus and their
services would no longer be necessary as contended on behalf
of the respondents. Only 11 direct recruits of 1979
recruitment were adversely affected by the dissolution of
the Trusts in that their services were dispensed with. We
were not informed as to how Trusts Executive officers of
other 10 Trusts were dealt with, but as petitioners have not
made any grievance in that behalf, we would overlook that
aspect. Petitioners on the contrary contend that dissolution
of the Trusts was a device to get rid of the petitioners. It
would be stretching credibility too far to hold on the
material placed before us that the State Government were to
the extreme length of dissolving Trusts to get rid of l I
petitioners, though in the circumstances of the case it is
equally difficult to disabuse our mind that such may be the
underlying motive. We are however determined not to be
influenced by the alleged possible motivation. The question
is if the Trusts were dissolved, what happened to the
assets, liabilities and the ongoing and continuing functions
of the Trusts. If the assets, liabilities and ongoing
functions were taken over by some other bodies, but with
their own staff carried on the activities, there would have
been some semblance of justification in the action of the
respondent in treating the petitioners as surplus and
dispensing with the services on that account. On the
contrary, it becomes evident from the record and it was not
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 13 of 16
disputed that except the 11 Executive of Officers-
petitioners herein, all other staff of all the Trusts were
retained and they carried out the functions of the Trust
under the supervision of an officer appointed by the
Municipal Committee or in some cases by the State
Government. lt thus unquestionably appears that what was
dissolved was the Board of Trustees p and not the Trusts.
Only the nomenclature changed. The work continued. And this
is evident from the fact that as late as August 19, 1980,
Batala Improvement Trust issued a notice inviting objections
from the public in respect of its development scheme.
Similarly on October ll, 1980 Amritsar Improvement Trust
invited applications for allotment of plots to the local
displaced persons available in certain schemes framed by it.
We can multiply such illustration. But we consider it
unnecessary to do so. And it is impossible to believe that
on mere dissolution of the Board of Trustees, all its
functions were wound up. As many as 1500 officers and other
members of the staff continued to work for the so-called
dissolved Trusts. The only persons whose services were
dispensed with as no more necessary were the
533
11 petitioners i. e. the direct recruits of 1979. In this
background, it become difficult to escape the conclusion
though we are trying our level best to do so that
dissolution of the Trusts was a device to get rid of the
petitioners. But on that point we say no more. Mr. Hardy
pointed out that by the ordinance No. 6 of 1980 styled as
Punjab Town improvement (Amendment) ordinance, 1980, sub-
sec. (2) was introduced to sec. 103 which took care of the
situation arising out of the dissolution of the Trusts. It
provided that all properties, funds and dues vested in or
realisable by the Trust and Chairman respectively shall
vests in and be realisable by the State Government till they
stand transferred to the Municipal Committee under sub. sec.
3. Sub-clause (c) of sub-section (2) enabled the Government
to appoint a Class I officer of the State Government for the
purpose of completing the execution of any scheme which the
Trust may be implementing. And sub-sec. (3) provided for the
consequences after all the functions Of the dissolved Trusts
were discharged. We fail to see how this section can throw
any light on the point under discussion? on the contrary, by
the very order dissolving the Trusts, certain officers were
appointed in respect of each trust to carry on the functions
of the Trusts. Therefore, the Trust independent of the Board
of Trustees had a corporate personality. It had a perpetual
succession and its functions had to be carried out. They
effect of the dissolution of the Trusts was merely
dissolving the Board of Trustees. The corporate personality
of the Trust remained, inviolate. But the Punjab Government
took advantage of the dissolution order dissolving in effect
the Board of Trustees and dispensed with the services of 11
petitioners. If the Trusts are functioning, if its schemes
are being implemented, if all other staff is retained, we
find it difficult to accept the submission of Mr. Hardy that
the services of the petitioners were no longer required
because of the dissolution of the Trusts, and therefore the
same have been dispensed with.
The third reason assigned is that their continuance in
service was only imposing an unnecessary burden on the State
Exchequer. In fact this is actually begging the issue. After
removing the petitioners, 11 other officers were asked to
take over the duties of the petitioners. In the order
dissolving the Trusts, it is mentioned that in exercise of
the power conferred by clause (2) (c) of sec. 103 of the
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 14 of 16
Act. the Governor of Punjab is further pleased to direct
that the officers indicated in column 2 shall perform the
functions of the Trust and the Chairman under the Act. Trust
Executive officer Was the highest executive officer and his
function is to be discharged
534
by the newly appointed officer. It is therefore, difficult
to accept the submission that the continued retention in
service of the petitioner after the dissolution of the
Trusts was imposing an unnecessary burden on the State
Exchequer.
This submission does not commend to us for the
additional reason that the State Exchequer was not
responsible for the salary and perquisites of the Trust
Executive officers, in view of the provision contained in
sub sec (4) of sec 17 of the Act which provides that salary,
allowances, gratuity, annuity, pension and other payments
required to be made to the members of the Trust Service in
accordance with the conditions of their service shall be
charged from the funds of the Trust in the prescribed
manner.
The fourth and fifth grounds for dispensing with the
services of the petitioners were that the petitioners being
probationers had no right to the posts, and their
performance in the opinion of the appointing authority was
not satisfactory are wholly untenable because the period of
probation had expired and they were continued in service
after allowing each one of them to earn an increment. It is
a permissible inference that till allowing each petitioner
to earn his increment, his service and work were deemed to
be satisfactory and nothing is pointed out to us as to what
occurred in respect of 11 petitioners simultaneously within
hardly a period of less than six weeks since the release of
increment to stigmatise each one of them that his work and
conduct was not satisfactory. Therefore, the conclusion is
inescapable that none of the reasons assigned for dispensing
with the services of the 11 petitioners is tenable.
Now it the reasons for dispensing with the services of
petitioners are untenable, the question is whether the
action of dispensing with services of the petitioners is
arbitrary. Mr. Hardy, learned counsel for the respondents
contended that even if the Court is satisfied that the
reasons set out in the return for dispensing with the
services of the petitioners are untenable and irrelevant,
nonetheless the Trusts having been dissolved the conclusion
cannot be escaped that services of the petitioners as Trust
Executive officer were no more necessary and therefore, this
Court cannot interfere with the order dispensing with the
services of the petitioners. We remain until convinced.
Though there was formal dissolution of Trusts, in effect and
substance the Board of Trustees was dissolved. Corporate
personality of Trusts remained unaffected. Staff remained.
Functions were
535
being carried out. By the time the writ petitions came up
for hearing Mr. Ramamurthi pointed out that the Trusts have
been re. A constituted and that was not seriously disputed
by Mr. Hardy. Further, it is crystal clear that what was
dissolved was the Board of Trustees and not the Trusts
because functions of the Trusts were being discharged by
other officers. The entire staff of the Trusts except the 11
petitioners was retained. Schemes formulated by the Trusts
were being implemented. In other words, the corporate
personality remained almost inviolate. Even if we decline to
examine the charge of mala fides, there are certain aspects
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 15 of 16
herein discussed which cannot be overlooked and which
compulsively and unerringly point in the direction that the
action was arbitrary. To recapitulate these circumstances,
it is crystal clear that the Board of Trustees was
dissolved, the Trusts without the name of Trust continued,
their functions continued, the staff excluding the 11 Trust
Executive officers was retained, and in place of the
officers whose services were dispensed with, some other
officers were asked to take over their functions and duties,
and within a short time, the Trusts were formally
constituted. The only effect sought to be achieved by the
bizarre exercise of first acquiring power to dissolve the
trusts and then ordering their dissolution was to dispense
with service of only 11 Trusts Executive officers of 1979
recruitment. And having achieved the desired result the
Trusts have been reconstituted albeit without showing the
fairness of recalling the discharged 11 Trust Executive
officers. Therefore, without imputing any motive, the
conclusion is inescapable that the action was thoroughly
arbitrary and violative of the guarantee of equality of
opportunity enshrined in Art. 16 read with Art. 14 of the
Constitution and such thoroughly arbitrary action cannot be
sustained, and deserves to be quashed.
The last contention of Mr. Hardy was that in any event
even if the Court comes to the conclusion that the
petitioners had completed the period of probation, yet they
would be temporary government servants and their services
were dispensed with after giving them salary for one month
in lieu of notice and as the Trusts no more exists, they at
least cannot be reinstated. We find no substance in this
contention. We would have beer. required to examine this
contention in some depth, but we are spared the exercise in
view of the decision of this Court in The Manager,
Government Branch Press and Anr. v. D.B. Belliappa, wherein
it was observed as under:
"Conversely, if the services of a temporary
government servant are terminated arbitrarily. and not
on the ground of
536
his unsuitability, unsatisfactory conduct or the like
which would put him in a class apart from his juniors
in the same service, a question of unfair
discrimination may arise, not withstanding the fact
that in terminating his service, the appointing
authority was purporting to act in accordance with the
terms of the employment. Where a charge of unfair
discrimination is levelled with specificity, or
improper motives are imputed to the authority making
the impugned order of termination of the service, it is
the duty of the authority to dispel that charge by
disclosing to the Court the reason or motive which
impelled it to take the impugned action
We have reached the conclusion that the action was
thoroughly arbitrary and if it is arbitrary, it smacks of
discrimination and a discriminatory treatment in the matter
of public employment cannot be overlooked.
Accordingly, these petitions must succeed. The order
dated September 25, 1980 dispensing with the service of each
of the petitioner is quashed and set aside and it is
declared that all the petitioners continue to be in service
and they should be forthwith reinstated. By an interim order
made by this Court, respondents were directed to pay half
the salary to the petitioners from the date of dispensing
with their services till further orders. Now that it is
declared that the petitioners continue to be in service,
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 16 of 16
each of the petitioners shall be paid his full salary with
effect from the date of his judgment, but, for the period
between the date of dispensing with the service and till
today, each of the petitioners should be paid only half the
salary. The respondents shall pay the costs to the
petitioners and bear their own.
P.B.R. Petitions allowed
537