Stigmatic termination without departmental inquiry is invalid, requiring reinstatement without back wages.

The petitioner, a contractual employee under the MGNREGA establishment, challenged the termination order dated 16 July 2025 and the appellate order dated 21 April 2026, seeking quashing of both orders, reinstatement, consequential benefits and back wages.

The petitioner contended that the termination was founded on allegations of misconduct and was therefore stigmatic, but had been imposed without a charge-sheet or regular departmental enquiry, contrary to Clause 7.2 of the MGNREGA Policy.

The State opposed the petition but was unable to distinguish the facts from the decision in Kishan Gambhir v. State of M.P. & Others, W.P. No. 34746/2026, which had dealt with the same legal controversy.

The Court accordingly considered the earlier decision applicable mutatis mutandis to the petitioner’s case.

Whether the termination of a contractual MGNREGA employee, founded on allegations of negligence, irregularity or misconduct, is stigmatic and therefore invalid when imposed without a regular departmental enquiry?

Whether a show-cause notice and consideration of the employee’s reply, without issuance of a charge-sheet and conduct of a regular enquiry, satisfy the requirements of natural justice before passing a stigmatic termination order?

Whether the petitioner was entitled to reinstatement and consequential benefits, and whether back wages should be granted?

The Court applied Clause 7.2 of the MGNREGA Policy, under which serious allegations against a contractual officer or employee require an enquiry and an opportunity of hearing before disciplinary action, including termination, is taken.

The Court relied on the principle that a termination order founded on allegations casting aspersions on an employee’s conduct, character or performance is stigmatic and cannot ordinarily be passed without a regular departmental enquiry and compliance with natural justice.

It relied on Rahul Tripathi v. Rajeev Gandhi Shiksha Mission, Bhopal, 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, and Khem Chand v. Union of India, AIR 1958 SC 300, concerning reasonable opportunity of defence.

The Court further applied the requirement that administrative and quasi-judicial orders affecting rights must be reasoned and self-contained, relying on 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 also followed the earlier decision in Kishan Gambhir, where materially similar termination and appellate orders had been quashed.

The Court treated the petitioner’s case as covered by Kishan Gambhir because the impugned termination and appellate orders were based on allegations of misconduct or dereliction of duty, thereby carrying adverse stigma and consequences for the petitioner’s service record.

Under Clause 7.2, such allegations required a proper enquiry in which the petitioner would receive a meaningful opportunity to defend himself. A mere show-cause notice and consideration of the reply could not substitute for a charge-sheet, evidentiary enquiry and effective opportunity of defence where the termination was punitive and stigmatic.

Since the termination had been imposed without following that procedure, and the appellate order could not cure the procedural defect in the original order, both orders were legally unsustainable.

The Court therefore adopted the relief granted in Kishan Gambhir, including reinstatement without back wages on the principle of “no work, no pay,” while preserving the respondents’ liberty to initiate fresh proceedings in accordance with law.

Both orders were accordingly set aside.

The respondents were directed to reinstate the petitioner forthwith with all consequential benefits, except back wages, which were denied on the principle of “no work, no pay.”

The respondents were granted liberty to take fresh action against the petitioner in accordance with law, if so advised. Any pending interlocutory application was also disposed of.