Holding

Termination of a probationer on the basis of unsatisfactory performance is permissible and does not constitute punishment; the order, even if it mentions performance, is valid.

Summary

The respondent, L.A. Balakrishnan, was appointed as an Assistant Professor on probation and was terminated twice within the probation period—first on 16 June 1991 citing unsatisfactory job proficiency, and later on 1 August 1991 by a brief order. Both terminations were challenged before the Educational Tribunal on the ground that the orders cast a stigma and amounted to punishment, leading the Tribunal to set aside the orders, a decision upheld by the Karnataka High Court. On appeal, the Supreme Court examined whether termination of a probationer for unsatisfactory performance constitutes punishment requiring a departmental inquiry and whether the wording of the termination order invalidates it. The Court held that an employer may lawfully terminate a probationer if the employee is found unsuitable, and that mentioning performance as a reason does not automatically render the termination punitive. Consequently, the Court allowed the appeal, setting aside the Tribunal and High Court decisions, and affirmed the validity of the termination orders.

Issues considered

Whether termination of a probationary employee on the ground of unsatisfactory performance amounts to punishment requiring a departmental inquiry.
Whether the wording of a termination order that cites performance creates a stigma that invalidates the termination.
Whether an employer can terminate a probationer without assigning a specific reason.

Subjects

probationterminationservice lawpunishmenteducational tribunalappointment suitabilitystigma

Judgment

-- ~
KRISHNADEV ARAYA EDUCATION TRUST AND ANR:
V.

L.A. BALAKRISHNA
A

JANUARY 15, 2001

[B.N. KIRPAL AND MRS. RUMA PAL, JJ.] B

Service Law

Probation-Termination of service during-Validity of-Respondent
appointed as Assistant Professor-Termination of service during probation- c
Termination order stating that job proficiency of respondent was not upto the
mark-Termination order successfully challenged before Tribunal-
Subsequently fresh termination order passed-This order also set aside by
the Tribunal-High Court upheld the decision of Tribunal-Appeal before
Supreme Court-Decision of Tribunal set aside-Held second ter!IJination
order was innocuously worded-Even the ground mentioned into the first D
order viz., the job proficiency of the respondent was not upto the mark was
a valid reason for terminating the service of the respondent-That reason
cannot be cited for contending that the termination was by way ofpunishment.
~
CIVIL APPELLATE JURISDICTION : Civil Appeal No : 628 of
E
2001.

From the Judgment and Order dated 09.02.2000 in CRP 3807/99 of the · ·
High Court of Kamataka at Bangalore.

P.P. Rao, A.K. Goel, Ms. Kiran Suri and Sheela Goel for the appearing F
parties.

The following Judgment of the Court was delivered :

Special Leave granted.

The respondent was appointed to the post of Assistant Professor on G
22nd Septen,>ber, 1990 on probation. Within the probationary period, by order
dated 16th June, 1991, his services were teminated. In the order terminating
the services, it was mentioned as follows:

"As a matter of policy, as usual, a committee was constituted to go H
387
388 SUPREME COURT REPORTS [200 I] I S.C.R.

A into the general performance of each staff. The committee after having
gone through the records of each individual right from the date of his/
her inception into the Institute, is of the opinion that your on the job
proficiency is not upto the mark. Hence, the Institution feels that
·-
your services are no longer required."

B The aforesaid order was challenged before the Educational Tribunal on
the ground that the order terminating the appointment cast a stigma and,
therefore, such an order could not be passed without holding a departmental
inquiry.

Before the Tribunal, the appellants herein conceded and the said order
C of termination was set aside. Subsequently again, within the period of
probation, a fresh order of termination was passed which was as follows :

"Sri L.A. Balakrishna, Assistant Professor, Department of
Mechanical Engineering will be relieved of his duties with effect from
1.8.1991, he may be paid his dues if any."
D
This order was again challenged and the Tribunal came to the conclusion that
the real reason for passing this order was that his services were found to be
unsuitable and, theref0re, this was by way of punishment. The order was set
aside and the high Court upheld the decision of the Tribunal. Hence, th is
appeal.
E
There can be no manner of doubt that the employer is entitled to
engage the services of a person on probation. During the period of probation,
the suitability of the recruit/appointee has to be seen. If his services are not
satisfactory which means that he is not suitable for the job, than the employer
has a right to terminate the services as a reason thereof. If the termination
F during probationary period is without any reason, perhaps such an order
would be sought to be challenged on the ground of being arbitrary. Therefore,
normally services of an employee on probation would be terminated, when he
is found not to be suitable for the job for which he was engaged, without
assigning any reason. If the order on the face of it states that his services
G are being terminated because his performance is not satisfactory, the employer
runs the risk 0f the allegation being made that the order itself casts a stigma.
We do not say that such a contention will succeed. Normally, therefore, it is
preferred that the order itself does not mention the reason why the services
are being terminated.

H If such an order is challenged, the employer will have to indicate the
KRISHNADEVARAYA EDUCATION TRUSTv. L.A. BALAKRISHNA 389
grounds on which the services of a probationer. were terminated. Mere fact A
that in response to the challenge the employer states that the services were
not satisfactory would not ipso facto mean that the services of the. probationer
were being terminated by way of punishment. The probationer is on test and·
if the services are found not to be satisfactory, the employer has, in terms of
the letter of appointment, the right to terminate the ser-vices.
B
In the instant case, the second order which was passed terminating the
services of the respondent was innocuously worded. Even if we take into
consideration the first order which was passed which mentioned that a
Committee which had been constituted came to the conclusion that the job
proficiency of the respondent was not upto the mark, that would be a valid C
reason for terminating the services of the respondent. That reason cannot be
cited and relied upon by contending that the termination was by way of
punishment.

We, accordingly, allow this appeal and set aside the decision of the
Tribunal as well as that of the High Court. No costs. D
T.N.A Appeal allowed.