Termination of contractual employment reciting criminal allegations is stigmatic and necessitates a departmental inquiry.

The applicant was engaged as a Medical Officer (Ayurvedic) by the Municipal Corporation of Delhi (MCD) on a contractual basis starting February 1, 2017

His contract was renewed periodically, with the most recent extension granted from February 11, 2025, to January 5, 2026

On January 8, 2025, an FIR was registered against the applicant in Nagpur under various sections of the IPC (including 498A, 376, and 420) following a matrimonial dispute involving his brother’s wife

The applicant was arrested on February 24, 2025, and released on bail on May 23, 2025

the applicant did not disclose the FIR or his arrest to the respondents even though his contract was being renewed in March 2025

Upon his attempt to rejoin, the respondents issued a show cause notice followed by a termination order on July 17, 2025, which explicitly cited his arrest and pending criminal proceedings as the grounds for termination

1. Whether the termination order dated July 17, 2025, was a termination simpliciter in terms of the contract or a punitive/stigmatic order issued in violation of the principles of natural justice

2. Whether the applicant’s non-disclosure of the FIR and arrest to the employer disentitles him from seeking equitable relief

The Tribunal applied the "motive vs. foundation" test established in Parshotam Lal Dhingra v. Union of India, which mandates that if a termination is founded on alleged misconduct rather than the mere exercise of a contractual right, it is punitive and requires a formal inquiry

It further relied on Swati Priyadarshini v. State of MP, affirming that even contractual employees cannot be terminated via stigmatic orders without due process

the Tribunal applied the "clean hands" doctrine from Kishore Samrite v. State of U.P., which holds that litigants who suppress material facts are not entitled to equitable relief

The Tribunal found that the impugned order was not a termination simpliciter because it specifically mentioned the applicant’s arrest, three-month custody, and pending legal proceedings

By incorporating these reasons, the respondents gave the order a "stigmatic" and "punitive" character, which legally requires a departmental inquiry or fact-finding exercise, even for contractual staff

Under the initial Memorandum of 2016, the applicant was obligated to remain "not booked under I.P.C./Cr.P.C."

The Tribunal noted that the applicant remained silent about the FIR and his arrest while his contract was being processed for extension in March 2025, which constituted a deliberate suppression of material facts

This non-disclosure misled the competent authority and violated the requirement to approach the Tribunal with "clean hands"

due to the applicant’s failure to disclose the criminal proceedings to the respondents, the Tribunal denied the relief of back wages and reinstatement

it directed the respondents to issue a fresh, non-stigmatic order terminating the applicant’s services

No order as to costs was made