Stigmatic termination of a contractual employee without departmental inquiry violates natural justice and is unsustainable.

The petitioner challenged the termination order dated 15 October 2025 and the appellate order dated 7 April 2026, seeking quashing of both orders, reinstatement with consequential benefits and back wages.

The petitioner contended that the termination was founded on allegations of misconduct/dereliction of duty and was therefore stigmatic, but had been passed without issuance of a charge-sheet or conduct of a regular departmental inquiry.

The State opposed the petition but was unable to distinguish the petitioner’s case from Kishan Gambhir v. State of M.P. & Ors. , W.P. No. 34746 of 2026, decided on 11 September 2026, which involved the same legal controversy.

Whether the petitioner’s termination, being founded on allegations of misconduct and carrying stigma, could lawfully be effected without a regular departmental inquiry and adequate procedural safeguards.

Whether the appellate order rejecting the petitioner’s challenge to the termination could survive when the original termination order was itself issued in violation of natural justice and without a proper inquiry.

Whether the petitioner was entitled to reinstatement with consequential benefits, subject to the principle of “no work, no pay,” and whether the respondents could be granted liberty to take fresh action in accordance with law.

Clause 7.2 of the MGNREGA Policy requires disciplinary proceedings, including an inquiry, where serious allegations are made against a contractual officer or employee.

A termination order based on allegations of misconduct, dereliction of duty or other adverse findings is stigmatic and cannot ordinarily be passed without a charge-sheet, effective opportunity of defence and a regular departmental inquiry, even where the employee is contractual, temporary or otherwise not permanent.

The Court relied on Rahul Tripathi v. Rajeev Gandhi Shiksha Mission , 2001 (3) MPLJ 616; Jitendra v. State of M.P. , 2008 (4) MPLJ 670; Malkhan Singh Malviya v. State of M.P. , ILR (2018) MP 660; Khem Chand v. Union of India , AIR 1958 SC 300; and Rajesh Kumar Rathore v. High Court of M.P. , W.P. No. 18657 of 2018, for the requirements of reasonable opportunity and inquiry in cases involving stigma.

The Court also applied the principles that administrative orders affecting rights must be reasoned and self-contained, as stated in State of Punjab v. Bandip Singh , (2016) 1 SCC 724, Kranti Associates Pvt. Ltd. v. Masood Ahmed Khan , (2010) 9 SCC 496, and Oryx Fisheries Pvt. Ltd. v. Union of India , (2010) 13 SCC 427.

The Court found that the controversy in the present petition was squarely covered by its earlier decision in Kishan Gambhir and that the State could not identify any material distinction.

Applying the rule concerning stigmatic termination, the Court treated the impugned termination as one founded on allegations of misconduct rather than as a simpliciter non-renewal of a contractual engagement.

Since the petitioner had not been subjected to a regular departmental inquiry and the termination order adversely attributed misconduct to him, the order violated the principles of natural justice and the applicable MGNREGA disciplinary framework.

The defect in the original order could not be cured by the appellate order, because an appellate decision cannot substitute for the procedural safeguards required at the initial stage.

Accordingly, the Court followed Kishan Gambhir mutatis mutandis .

It set aside the termination order dated 15 October 2025 and the appellate rejection order dated 7 April 2026.

The respondents were directed to reinstate the petitioner forthwith with all consequential benefits, but without back wages on the principle of “no work, no pay”.

The respondents were granted liberty to initiate fresh proceedings against the petitioner in accordance with law, if so advised.

Any pending interlocutory application was also disposed of.