Holding

The services of the respondents could not be terminated after the maximum period of probation except by departmental disciplinary proceedings, as the regulations deem them confirmed, and the High Court's interference was justified.

Summary

Three employees of Karnataka State Road Transport Corporation were placed on a two‑year probation and later terminated after the probation period ended. They challenged the terminations before the High Court, which held that the corporation could not terminate their services after the maximum probation period because the regulations deemed them confirmed unless a disciplinary proceeding was undertaken. The corporation appealed, arguing that Regulation 11(8) required a specific confirmation order and that no automatic confirmation arose. The Supreme Court examined the distinction between "probation" and "officiation" in Regulation 11, held that clause 8 applies only to officiation, and that termination of a probationer after the maximum period is only permissible through departmental disciplinary action. Consequently, the Court upheld the High Court’s decision and dismissed the appeals.

Issues considered

Whether an employee whose probation period has expired without a specific confirmation order is deemed to be confirmed under Regulation 11.
Whether the corporation may terminate the services of such an employee after the maximum probation period without disciplinary proceedings.
Whether Regulation 11(8) applies to probationers or only to persons on officiation.
Whether the High Court was justified in interfering with the termination orders.

Subjects

service lawprobationterminationconfirmationdepartmental disciplinary proceedingsKarnataka State Road Transport CorporationRegulation 11employment law

Judgment

A KARNATAKA STATE ROAD TRANSPORT CORPORATION AND ANR.
v.
S. MANWNATH ETC.

APRIL 24, 2000

B [S. SAGHIR AHMAD AND DORAISWAMYRAru, JJ.]

Service Law :

Karnataka State Road Transport Corporation-Service Regulations--
C . Regulation 11 Clause (3), (6) & (8)-Termination ofservice-After completion
ofprobation period-An implicit term in the scheme ofService Regulation, that
on the expiry of the period of probation beyond the maximum term provided
therein, an employee would be deemed to have been confirmed-Plea, that
notwithstanding the completion of the period of probation, in view of the
regulation no automatic confirmation can be claimed-Held, services not to be
D terminated after maximum period of probation-The service cannot be put an
end to except by means of departmental disciplinary proceedings.

Respondents were placed on probation after appointment to their
respective posts for a period of two years. Their services were terminated,
E after the probation period of two years was completed by them.

The respondents filed writ petitions before High Court, challenging
their respective termination orders. The writ petitions were allowed by
Single Judge holding that there was an implicit term in the Scheme of
Regulation governing their services that on the expiry of the period of
F probation beyond the maximum term provided therein, an employee would
+
be deemed to have been confirmed inasmuch as the Corporation cannot
terminate their services on the expiry of such period. The judgment of the
Single Judge was confirmed by Division Bench.

G In appeal to this court, the appellants contended that notwithstand-
ing the completion of the period of probation, having regard to the stipula-
tion in Regulation 11 Clause (8) no automatic confirmation or status of a
'permanent employee' could be claimed to have been acquired by the
respondents; and relying on Regulation 11(6) further contended that a
specific order of confirmation by the competent authority is a condition
H
234
K.S.R.T.C. v. S. MANJUNATH 235
precedent for claiming confirmation in service on completion of the proba- A
tion.

Dismissing the appeal 1 this Court

HELD : 1. The services of the respondents could not be put an end to
except by means of departmental disciplinary proceedings, after following B
the mandatory requirements of law. Therefore, the High Court cannot be
faulted for interfering with the orders of termination of the services of the
respondents. [244-D-E]

. 2.1. Regulation H deals with two different categories of cases - one
about the "probation" of an appointee other than by way of promotion and c
the other relating to "officiation" of a person appointed on promotion. The
similarity of purpose and identity of object apart, of such provision, there is
an obvious difference and positive distinction disclosed in the manner they
have to be actually dealt with. The deliberate use of two different phraseology
"probation" and "officiation" cannot be ignored obliterating the substantial D
variation in the method of handling such categories of persons envisaged by
the Regulations. The mere fact that a reference is made to Clause (3) also
in the later part of Clause (8) of the Regulation could not be used to apply
all the provisions relating to the category of appointees on "officiation"
to the other category of appointees on ''probation''. The stipulation E
in Clause (8) of the Regulation when making the passing of an order,

.. a condition precedent for satisfactory completion specifically refers
only to the completion of''period of officiation". Similarly, notwithstanding
a reference made to Clause (3) alongside Clause (4), in stipulating
1
the consequences of any delay in making an order declaring satisfactory
completion, the reference is confined only to deemed satisfaction F
and completion of ''the period of officiation", and not of probation. Clause
(9) of the Regulation insofar as it provides for confirmation as a sequel
to declaration, only deals with a promotee to a temporary post and not of
the other category. [293-G-H; 244-A-C]
G
2.2. While dealing with the termination of a candidate, not found suit-
able for the post, clause (3) of the Regulation envisages such termination
being made, at any time "within the period of probation" and not at any time
after the completion of such maximum period of probation. [244-C-D]

Dayaram Dayal v. State of M.P. & Anr., [1997] 7 SCC 443 and Wasim H
236 SUPREME COURT REPORTS [2000] 3 S.C.R.
A Beg v. State of U.P. & Ors., [1998] 3 SCC 321, relied on.

State of Punjab v. Dharam Singh, AIR (1968) SC 1210; Paramjit Singh
v. Ram Rakha, [1979] 3 SCC 478; M.K. Agarwal v. Gurgaon Gramin Bank,
AIR (1988) SC 286; Jai Kishan v. Commissioner of Police & Anr., [1995]
Suppl. 3 SCC 364 and State of Punjab v. Baldev Singh Khosla, [1996] 9 SCC
B 190, referred to.

CIVIL APPELLATE JURISDICTION: Civil Appeal No. 113of1998
Etc. Etc.

From the Judgment and Order dated 22:10.97 of the Kamataka High
c Court in W.A. No. 38 of 1996.

K.R. Nagaraja, K.K. Tyagi, Ms. Abhilasha, Ms. Shalini Bhalla and A.P.
Jain for the Appellants.

S.S. Javali, S.N. Bhat and N.P.S. Panwar for the Respondents.
D
The Judgment of the Court was delivered by

RAJU, J. These three appeals are dealt with together since not only they
involve a common question of law but also for the reason that they were dealt
with in common in the High Court and submissions have been also in common
E
before us.

The respondent in Civil Appeal No.113/98 was appointed as Assistant
Traffic Manager in Karnataka State Road Transport Corporation (for short
'KSRTC') pursuant to a Select List of candidates prepared and published on
F 13/15-12-82 for a period of two years and was placed on probation. On
10.1.85, due to certain lapses, which were pending inquiry, an order postpon-
ing one increment was passed. On 7.8.85, the period of probation was
+
extended upto 14.6.86. Ultimately, on 13.1.88 his services came to be
terminated for the reason that his Performance Report during the period of
probation was not satisfactory and he also failed to show any improvement
G despite having been given a chance to do so. Aggrieved, Writ Petition No.
4273/88 was filed before the High Court challenging the said order of
termination and for consequential benefits.

The respond~nt in Civil Appeal No. 114/98 joined the service in KSRTC
H as a Clerk on 5.3.63. Thereafter, he was considered for appointment and
K.S.R.T.C. v. S. MANJUNATH [RAJU, J.] 237
included in a Select List for appointment (not by way of promotion) as A
Assistant Traffic Manager. On 22.11.82, the respondent was offered appoint-
ment as such initially for a period of two years and was placed on probation
for a period of two years. On 13/15-12-82, the appointment order came to be
issued as Assistant Traffic Manager and he was also placed on probation for
two years. On 14.12.84 when the period of probation was over, he was
B
continued in service without passing any order of confirmation since he was
found to be indifferent to the job for which action appears to have also been
taken resulting in a punishment of censure and subsequently also of withhold-
ing one increment. His appointment as Assistant Traffic Manager came to be
terminated and he was reverted to his substantive post of Junior Assistant. This
was challenged by means of a Writ Petition in the High Court. c
The respondent No.I in Civil Appeal No.115/98 was selected for
appointment as Assistant Mechanical Engineer Class-II and on 28.11.81 he
was also appointed as such and placed on probation. He had incurred certain
adverse remarks on deficiency being noticed in his. performance. On 6.12.83
D
though the period of two years had come to an end, the same was extended
on 19.4.84 for a period of six months and further extended on 7.6.84 for
another six months. During his service, he was found to have been guilty of
various acts of misconduct and ultimately on 16.11.85 his services were
terminated on the ground of unsuitability as also misconduct. Aggrieved, the
respondent filed a Writ Petition before the High Court. E

All the three Writ Petitions were initially heard by a learned Single
Judge of the Kamataka J;Iigh Court and by a common order dated 3.11.95
those Writ Petitions were allowed on the view that there was an implicit te1m
in the scheme of Regulation governing their services that on the expiry of the
F
period of probation beyond the maximum term provided therein, an employee
wil1 be deemed to have been confirmed inasmuch as the Corporation cannot
terminate their services on the expiry of such period. In coming to such a
conclusion, the learned Single Judge followed an earlier decision of a Division
.. Bench dated 5.2.82 in Writ Appeal No.100/91 M. BalachandraRao v. KSRTC
& Am:. The Corporation, aggrieved by such orders, pursued the matter on G
Appeal before a Division Bench in Writ Appeal Nos.36-38/96. The Division
Bench adverted to the decisions of this Cowt reported in State of Punjab v.
Dharam Singh, AIR (1968) SC 1210; Paramjit Singh v. Ram Rakha, [1979]
3 SCC 478) and M.K Aganval v. Gurgaon Gramin Bank, AIR (1988) SC 286
and observed that the position in the appeals is no different from th~ one dealt H
238 SUPREME COURT REPORTS [2000} 3 S.C.R.
).._
A with in those decisions of this Court and consequently confirmed the order of
the learned Single Judge. Hence, the above appeals.

The sheet-anchor of attack for the appellants is based upon Regulation
11, particularly clause (8) of the said Regulation and it is contended that
notwithstanding the completion of the period of probation, having regard to
B the stipulation therein no automatic confirmation or status of a 'permanent
employee' could be claimed to have been acquired by the respondents. "II
According to the learned counsel, the principles laid down in those decisions
of this Court were not properly appreciated and applied with particular
reference to the Regulation governing the services of the respondents in the
c Corporation and, therefore, the orders of termination passed by the Corpora-
tion could not have been interfered with. Reliance has been placed on the
decisions reported in Jai Kishan v. Commissioner of Police & Am: [1995]
Supp. 3 SCC 364 and State of Punjab v. Baldev Singh Khosla, [1996] 9 SCC -4
190. Regulation 11 (6) has also been relied upon to urge that a specific order
of confirmation by the Competent Authority is a condition precedent for
D claiming confirmation in service or completion of the probation and on
account of a mere lapse or delay on the part of the Competent Authority in
passing the orders declaring the successful completion of probation, status of
confirmation could not be claimed to have accrued to the respondents
~
automatically after the expiry of the period of probation or its extended period.
E
The learned counsel for the respondents contended that Regulation
No.11 has been properly construed by the High Court in the light of the
principles laid down in similar cases where almost identical type of service
rules/regulations came to be considered by this Court and, therefore, the
decisions under challenge do not call for interference. Reliance has also been
F placed in this regard on the decisions reported in Dayaram Dayal v. State of +
M.P. & Am:, [1997] 7 SCC 443 and Wasim Beg v. State of U.P. & Ors., [1998]
3 sec 321, besides inviting our attention tQ some of the case law referred to
therein. The impugned orders of termination of services of the respondents,
though claimed to be orders terminating the pr9bation and consequently their
,,.
G services are in substance only orders of punishment without following the
mandatory P!Ocedure therefor or giving any opportunity to show- cause or
--"'"
conducting any inquiry in this regard. Argued the learned counsel for the
respondents further that the High Court Was right in setting asi(je such orders
and the appeals are devoid of any merit.

H To appreciate the grievance projected on either side, it is necessary to
K.S.R.T.C. v. S. MANJUNATH [RAJU, J.] 239
refer to Regulation No.11, which reads as follows : A

"11. Probation

1. Every candidate appointed against a permanent post shall be on
probation for a period of two (2) years. This term may be
extended at the discretion of the "Appointing Authority" for B
reasons to be recorded in writing by a further period not
exceeding one (1) year. The period of probation shall not be
further extended.

2. On the satisfactory completion of the period of probation and
his passing the prescribed tests, if any, within the Period of c
Probation the candidate shall become eligible for confirmation.

3. If the candidate appointed on probation is not found suitable for
) the post, his services may at the discretion of the appointing
authority, be terminated at any time within the period of D
probation. In case of an employee of the Corporation, who is
appointed on probation on selection such termination shall mean
reversion to the post held by him regularly prior to such
appointment.

4. All appointments by promotions shall be on an officiating basis E
for a period of one year which may for reasons to be recorded

... in writing be extended by the appcinting authority by a period
not exceeding SIX MONTHS .

5. At the end of the period of officiation the appointing authority
shall consider the suitability of the person so promoted to hold F
the post to which he was promoted.

6. If the Appointing Authority considers that the work of the
person so promoted during the period of officiation is satisfac-
tory, it shall, as soon as possible, issue an order declaring the
G
person to have satisfactorily completed the period of officiation
and is confirmed in the promoted post. Such an order shall have
effect from the date of completion of officiation.

7. If at the end of the period of officiaiton or the extended peirod
of officiation under Sub-Regulation 4 of this Regulation, as the H
240 SUPREME COURT REPORTS (2000] 3 S.C.R.
A case may be, the Appointing Authority considers that the person )..._
is not suitable for the post to which he is promoted it shall, by
order revert, the person to the post which he held prior to his
promotion.

8. A person shall not be considered to have satisfactorily com-
B pleted the period of officiation unless a specific order to that
effect is made. Any delay in the issue of an order under Sub-
Regulation 3 or Sub-Regulation 4 of this Regulation, shall not
entitle the person to be deemed to have satisfactorily completed "'
the period of officiation.
c 9. A person who has been declared to have satisfactorily com-
pleted his officiation under Sub-Regulation (4) shall be con-
finned in the category for which he was promoted, at the earliest

D
opportunity, Provided that where the appointment is made by
promotion to a temporary post in any service the person
concerned shall be continued on an officiating basis in the
•
temporary post."

The law on the subject has been varying, depending upon the peculiar
pattern of the service rules/regulations concerned and the scheme underlying
the same inspite of more than one Constitution Bench judgments of this Court
E declaring the general and basic principles governing the rights of a proba-
tioner. There was always a keen tussle between the employer and employee
in the application of those principles to individual or class or category of cases.

This Court had an occasion to review, analyse critically and clarify the
principles on an exhaustive consideration of the entire case law in two recent
F
decisions reported in Dayaram Dayal's case (supra) and Wasim Beg's case
(supra). One line of cases has held that if in the Rule or Order of appointment,
a period of probation is specified and a power to extend probation is also
conferred and the officer is allowed to continue beyond the prescribed period
of probation, he cannot be deemed to be confirmed and there is no bar on the
G power of termination of the officer after the expiry of the initial or extended
period of probation. This is because, at the end of probation he becomes
merely qualified or eligible for substantive permanent appointment. The other
line of cases are those where even though there is a provision in the rules for
initial probation and extension thereof, a maximum period for such extension
H is also provided beyond which it is not permissible to extend probation. The
K.S.R.T.C. v. S. MANJUNATH [RAJU, J.] 241
...J.. Constitution Bench which dealt with the case reported in State of Punjab v. A
Dharam Singh, AIR (1968) SC 1210, while distinguishing the other line of
cases held that the presumption about continuation, beyond the period of
probation, as a probationer stood negatived by the fixation of a maximum time
'5
limit for the extension of probation. Consequently, in such cases the termina-
tion after expiry of the maximum period upto which probation could be
B
extended was held to be invalid, inasmuch as the officer concerned must be
deemed to have been confirmed.

The principles laid down in Dharam Singh's case (supra) though were
accepted in another Constitutional Bench ofa larger composition in the case
reported in Samsher Singh, etc. v. State of Punjab & Am:, (1974] 2 SCC 831, c
the special provisions contained in the relevant rules taken up for considera-
ti on therein were held to indicate an intention not to treat the officer as deemed
to have been confirmed, in the light of the specific stipulation that the period
):
of probation shall be deemed to be extended if the officer concerned was not
confirmed on the expiry of his period of probation. Despite the indication of
a maximum period of probation, the implied extension was held to render the D
maximum period of probation a directory one and not mandatory. Hence, it
was held that a probationer in such class of cases is not to be considered
confirmed, till an order of confirmation is actually made. The further question
for consideration in such category of cases where the maximum period of
probation has been fixed would be, as to whether there are anything else in E
the rules which had the effect of whittling down the right to deemed
-:. confirmation on account of the prescription of a maximum period of probation
beyond which there is an embargo upon further extension being made, and
such stipulation was found wanting in Dayaram Dayal's case (supra).

The decision in Wasim Beg's case (supra) also purported to classify F
these type of cases into three categories, on a review of the entire gamut of
law. It was observed therein as follows:

"15. Whether an employee at the end of the probationary period
automatically gets confirmation in the post or whether an order of
confirmation or any specific act on the pru.t of the employer confirm-
G
~ ing the employee is necessary, will depend upon the provisions in the
relevant Service Rules relating to probation and confirmation. There
are broadly two sets of authorities of this Court dealing with this
question. In those cases where t11e Rules provide for a maximum
period of probation beyond which probation cannot be extended, this H
242 SUPREME COURT REPORTS [2000] 3 S.C.R.
Court has held that at the end of the maximum probationary period ).__
A
there will be a deemed confirmation of the employee unless Rules
provide to the contrary. This is the line of cases starting with State
of Punjab v. Dharam Singh, M.K. Agaiwal v. Gurgaon Gramin Bank,
t
Om Parkash Maurya v. U.P. Coop. Sugar Factories Federation, State
of Gujarat v. Akhilesh C. Bhargav.
B
16. However, even when the Rules prescribe a maximum period of
probation, if there is a further provision in the Rules for continuation
of such probation, beyond the maximum period, the courts have made
an exception and said that there will be no deemed confirmation in
c such cases and the probation period will be deemed to be extended.
In this category of cases we can place Samsher Singh v. State of
Punjab which was the decision of a Bench of seven Judges where the
principle of probation not going beyond the maximum period fixed
was reiterated but on the basis of the Rules which were before the
Cour~. this Court said that the probation was deemed to have been
D
extended. A similar view was taken in the case of Municipal Cmpn.
v. Aslzok Kumar Mishra. In Satya Narayan Athya v. High Cou11 of
M.P.:- although the Rules prescribed that the probationary period
should not exceed two years, and an order of confirmation was also
necessary, the termination order was issued within the extended
E period of probation. Hence the termination was upheld.

17. The other line of cases deals with Rules where there is no .
,-

maximum period prescribed for probation and either there is a Rule
providing for extension of probation or there is a Rule which requires
F a specific act on the part of the employer (either) by issuing an order
of confirmation or any similar act) which would result in confirmation
of the employee. In these cases unless there is such an order of
confirmation, the period of probation would continue and there would
be no deemed confirmation at the end of the prescribed probationary
period. In this line of cases, one can put Sukhbans Singh v. State of
G Punjab, State of U.P. v. Akbar Ali Khan, Kedar Nath Bahl v. State
of Punjab, Dhanjibhai Ramjibhai v. State of Gujarat and Tarsem Lal ~
Venna v. Union of India, Municipal Corpn. v. Ashok Kumar Misra
and State of Punjab v. Baldev Singh Khosla. In the recent case of
Dayaram Dayal v. State of M.P. (to which one of us was a party) all
H these cases have been analysed and it has been held that where the
K.S.R.T.C. v. S. MANJUNATH [RAJU, J.] 243
Rules provide that the period of probation cannot be extended beyond A
the maximum period there will be a deemed confinnation at the end
of the maximum probationary period unless there is anything to the
contrary in the Rules."

In the light of the position of law, thus laid down it has to be seen under
what class or category the cases before us will fall and whether despite of the B
fixation of the maximum period of probation there are any special provision
in the rules which could negate or nullify the inevitable consequence of a
deemed confirmation, arising out of a ceiling fixed firmly on the period of
probation and extension to be made thereafter, if any. Since much stress has
been laid by the counsel on either side on the purport to be of Regulation 11, C
it becomes necessary to consider the ambit and scope of the stipulations
therein. The Regulation deals with the period of probation of an appointee,
other than by way of promotion [clauses ( 1) to (3) of Regulation 11] and also
about the period of officiation in respect of an appointee by way of promotion
[clauses (4) to (9)]. The Regulation does make, in our view, substantial
difference, for purposes of confirmation between an appointee by promotion D
and one appointed, othe1wise than on promotion, and purport to deal with
these two categories distinctly and separately, in all respects - the relevant
period, subsequent extension and consequences arising out of expiry of such
maximum period coupled with the action or inaction on the part of the
competent authority for the purposes of the Regulation. The learned counsel E
for the appellant corporation could not easily get over the dichotomy main-
tained throughout in the various clauses of this Regulation among the two
categories or method of appointment. But, what was strongly pleaded was that
Clause (8) of the Regulation takes care of both categories and, therefore,
unless a specific order has been made by the competent authority, the person
concerned shall not be considered to have satisfactorily completed his period F
of probation and any delay in the issue of an order shall not entitle the person
to be deemed to have satisfactorily completed the probation.

As indicated by us, the Regulation deals with two different categories
of cases - one about the "probation" of an appointee other than by way of
promotion and the other relating to "offiiiation" of a person appointed on
G
promotion. The similarity of purpose and identity of object apart, of such
provision, there is an obvious difference and positive distinction disclosed in
the manner they have to be actually dealt with. The deliberate use of two
different phraseology "probation" and "officiation" cannot be so lightly
ignored obliterating the substantial variation in the method of handling such H
244 SUPREME COURT REPORTS [2000) 3 S.C.R.
A categories of persons envisaged by the Regulations. The mere fact that a
reference is made to Clause (3) ·also in the later part of Clause (8) of the
Regulation could not be used to apply all the provisions relating to the
category of appointees on "officiation" to the other category of appointees on
"probation". The stipulation in Clause (8) of the Regulation when making the
passing of an order, a condition precedent for satisfactory completion specifi-
B
cally refers only to the completion of "period of officiation". Similarly,
notwithstanding a reference made to Clause (3) alongside Clause (4), in
stipulating the consequences of any delay in making an order declaring
satisfactory completion, the reference is confined only to deemed satisfaction
and completion of "the period of officiation", and not of probation. Clause (9)
c of the Regulation insofar as it provides for confirmation as a sequel to
declaration, only deals with a promotee to a temporary post and not of the
other category. While dealing with the termination of a candidate, not found
suitable for the post, clause (3) of the Regulation envisage such termination
being made, at any time "within the period of probation", and not at any time
after the completion of such maximum period of probation. Consequently, the
D
cases on hand also would fall within the category of cases dealt with in
Dayaram Dayal's case (supra) and Wasim Beg's case (supra) and the services
of the respondents could not be put an end to except by means of departmental
disciplinary proceedings, after following the mandatory requirements of law.
Therefore, the High Court cannot be faulted for interfering with the orders of
E termination of the services of the respondents.

For all the reasons stated above, we see no merit in the challenge made
to the judgment of the High Court and these appeals fail and are hereby
dismissed. No costs.

F K.K.T. Appeals dismissed.