JUDGMENT

K. RAMASWAMY, J.:— The facts in this appeal would lie in a short compass. The appellant appointed the respondent as Lower Division Clerk on September 22, 1966 and put him on probation for a period of two years which expired on September 21, 1968. On December, 9, 1968, the appellant served him with one months notice terminating the services with effect from Jan., 9, 1969. Calling in question the order of termination, the respondent laid the suit for declaration that the termination without enquiry and an opportunity of being heard was violative of Rule 9A of the Madhya Pradesh Civil Service Classification, Control and Appeal (Rules), 1966 with consequential declaration that he became a permanent employee of the Corporation with continuity of the service and arrears of salary. The trial Court dismissed the suit and on appeal it was confirmed. The High Court in Second Appeal No. 315/70 by judgment and decree dated April ll,. 1977 allowed the appeal and decreed the suit as prayed for. On leave under Art. 136 the appellant filed this appeal.

2. Shri S. K. Gambhir, learned counsel for the appellant contended that the respondent being a probationer acquires permanent status only on confirmation. Before confirmation the appellant had exercised its power, in terms of the rules, and terminated the respondents service. The High Court committed manifest error of law in its finding that on expiry of two years period of probation the respondent must be deemed to have been confirmed under Rule 14 of the Municipal Officers and Servants Recruitment Rules which no longer were in force. He further contended that R. 8 of Madhya Pradesh Government Servants General Conditions of Service Rules, 1961 for short the Rules expressly provides confirmation of probation as a condition precedent. Notice was issued terminating the service before confirmation and so it is valid in law. Shri S. S. Khanduja, learned counsel for the respondent contended that by operation of the resolution passed by the Municipal Corporation under S. 25 of the Central Provinces and Berar Municipality Act, 1922, the Municipal Officers and Servants are governed by recruitment rules thereunder. Rule 14 thereof, relied on by the High Court expressly provided to put an employee on probation for a period of two years subject to being confirmed. At the end of the probationary period, if the probationer was found unfit, the Municipal Committee shall, if he was a direct recruit, dispense with his service and if he has been recruited by transfer, to revert to his original post. On expiry of the period of two years, no action was taken by the Municipal Corporation. Therefore, the respondent must be deemed to have been confirmed. Thereafter, the only power which the Corporation had was to terminate the service of the respondent in accordance with Classification, Control and Appeal Rules after conducting an enquiry and giving him reasonable opportunity that too for misconduct. No such procedure was adopted. Therefore, the impugned notice was illegal and the High Court was justified in granting the decree.

3. The first question is, which are the relevant rules that would be applicable to the respondent? Admittedly, the Municipal Council became a Municipal Corporation on or after August 26, 1967. A resolution was passed making a draft bye-law by a Municipal Council on November 11, 1960, exercising the power under S. 178(3) of the Madhya Pradesh Municipal Act, 1922 and confirmed the same under S. 25(1) of the said Act, adopting Government Rules to regulate the conditions of service of officers and servants of the Municipal Committee which provides thus :

"The fundamental rules and the civil service regulations as amended from time to time in their applications to M.P., the M.P. Government Servants Conduct Rules, 1959, as amended from time to time and the General Book Circulars of the Govt. of M.P. as in force for the time being shall apply to the officers and servants of the M. C. in the