Important Point
Where neither initial period of probation was extended nor letter of appointment was issued before expiry of initial probation, appellant cannot get a declaration that he continues to be in service after service of notice of termination of his service.

Headnote:(i) Specific Relief Act, 1963-Sections 14(1)(a) and 34-Declaratory suit-C.P.C., 1908-Section 11 Expl. VII-Suit for declaration that termination of his probation is bad in law-Respondent alleged that suit was not maintainable u/s. 34 of Specific Relief Act-Suit decreed-Writ petition against-Dismissed-Whether operates as res-judicata for argument that suit is not maintainable u/s. 34 of the Act? (Yes) (Paras 11 to 19)
       (ii) Service Jurisprudence -Probationary Inspector in Insurance Company-Probation terminated by notice on the ground that he failed to achieve targetted premium-Whether entitled to declaration that he continues to be in employment of Insurance Co.-High Court holding that he is not because the contract of employment does not entitle him to continue-Whether correct? (Yes).
       Held : Terms and conditions of employment of the appellant have been incorporated in the letter of appointment dated 2.12.1980. It contains the following:
        (1) Initially he would be on probation for a period of 12 months and during that period he has to achieve a premium of at least Rs. 75,000/- to become eligible for promotion as Probationary Inspector, Grade I.
        (2) If appellant falls short of the said target, respondent-Company reserved its right to extend the period of probation by another 12 months provided the following conditions are satisfied.
        (a) He should have produced a premium amount of Rs. 50,000/- during the first 12 months period.
        (b) A request should be made by the appellant in writing for the purpose of getting extension of the period of probation.
        (c) the company has discretion to decide whether such request should be granted or not.
        (3) Unless a letter appointing him as probationary Inspector (Grade-I) is issued by the company, before the expiry of the initial probationary period or the extended probationary period (as the case may be) his service shall stand automatically terminated.
        (4) His service is also liable to be terminated without assigning any reason during probationary period and/or extended period.
       Appellant has no case that respondent-company has issued any letter appointing him as “Probationary Inspector (Grade-I)” before the expiry of the initial period of 12 months nor has he a case that initial period of probation was further extended at any time.
       The above being the admitted position, appellant cannot get a declaration that he continues to be in service. Hence the conclusion of the High Court that the suit is liable to be dismissed does not warrant any interference.
       In the result, we dismiss the appeal. No costs. (Paras 21, 22, 23 & 24)

Judgment

Thomas, J.-Special leave granted.

2. Appellant claims to be still in the service of National Insurance Company Limited (respondent) as a probationary Inspector on a contention that the order passed by the respondent on 13.3.1982 terminating his probation is bad in law. He succeeded in the trial Court where he filed the suit for a declaratory decree and also in the first appellate Court, but he was non-suited by the High Court in the second appeal filed by the respondent. Hence he has come up in this Court with this appeal.

3. Appellant was appointed as Inspector on probation at Khalidabad under the Gorakhpur branch of the respondent Company with effect from 19.9.1980, initially for a period of twelve months subject to certain conditions. On 13.3.1982 respondent-company served upon him thirty days notice of termination of his service on the premise that appellant failed to achieve the targeted premium amount.

4. Appellant filed the suit in the Munsif’s Court Gorakhpur for a decree declaring that the said notice of termination is illegal and void and that he continues to be in service of the Company with all the benefits flowing from the post. Respondent-Company contested the suit by filing a written statement in which it was contended, inter alia, that the suit is not maintainable under Section 34 of the Specific Relief Act (for short ‘the Act’) and that the notice of termination of the appellant is legal and valid.

5. However, respondent-company did not participate during evidence stage and hence the trial court proceeded with the suit ex-parte and a decree was passed in terms of the plaint on 25.1.1991. Appellant took out execution proceedings in which he claimed a sum of Rs. 1,02,861/- as arrears of pay due to him from the date of notice of termination. Respondent resisted the execution by putting-forth various contentions including that the decree is unenforceable and void as the same was passed without jurisdiction. The execution court has repelled all such objections by its order dated 7.9.1991.

6. Respondent challenged the said order by means of a writ petition filed under Articles 226 and 227 of the Constitution. High Court of Allahabad dismissed the writ petition holding that the decree was passed by a court having jurisdiction and, that the suit was maintainable under Section 34 of the Act.

7. It was thereafter that the respondent-company preferred a first appeal before the Court of Civil Judge (Senior Division) Gorakhpur challenging the decree of the trial court. When that appeal was dismissed respondent-Company preferred a second appeal before the High Court of Allahabad. Four questions were formulated by the respondent-Company in the second appeal and pressed them into service as substantial questions of law. They are: (1) Whether the termination order is violative of the contractual term that one month’s notice or pay in lieu thereof in sine qua non; (2) whether appellant is entitled to reinstatement without entering upon a finding that there was statutory violation; (3) whether the suit is barred under the Industrial Disputes Act; (4) whether the suit is barred under Section 34 of the Act.

8. High Court did not permit the respondent-Company to pursue with the last two questions on the premise that those questions were finally decided in the writ petition and such decision will operate as a bar of res-judicata. However, learned Single Judge of the High Court proceeded to consider the other two questions and held that non-payment of one month’s pay in lieu of the notice would not vitiate the termination order and that at any rate, appellant is not entitled to continue as a probationary Inspector. Resultantly, the High Court reversed the decree of the trial Court and dismissed the suit.

9. Learned counsel for the respondent-company once again canvassed for acceptance of the argument that the suit is not maintainable in view of Section 34 of the Act. But in view of the clear finding rendered by the High

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1998 Supreme(SC) 534

Important PointWhere neither initial period of probation was extended nor letter of appointment was issued before expiry of initial probation, appellant cannot get a declaration that he continues to be in service after service of notice of termination of his service.

Cases Referred (7)

Important Point
Where neither initial period of probation was extended nor letter of appointment was issued before expiry of initial probation, appellant cannot get a declaration that he continues to be in service after service of notice of termination of his service.