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2026 Supreme(SC) 636

SUPREME COURT OF INDIA
J.K. Maheshwari, Atul S. Chandurkar, JJ.
General Manager, Bank Of Baroda And Others – Appellants
Versus
Ashok Kumar Singh And Others – Respondents
Civil Appeal No. 4814 of 2017
Decided On : 29-05-2026

Advocates appeared:
For the Appellant(s) : Mr. Rajesh Kumar Gautam, AOR Mr. Anant Gautam, Adv. Mr. Vibhu Sharma, Adv. Ms. Likivi K Jakhalu, Adv. Mr. Aman Gahlot, Adv. Mr. Rishi Chauhan, Adv. Ms. Azal Aekram, Adv.
For the Respondent(s): Mr. P.S. Patwalia, Sr. Adv. Mr. Gopal Jha, AOR Ms. Deveshi Chand, Adv. Ms. Shireesha Sharma, Adv. Mr. Sawan Datta, Adv. Mr. Nimish Arjaria, Adv. Mr. Umesh Kumar Yadav, Adv. Mr. Tilak Vij, Adv. Ms. Arpita Mishra, Adv. Ms. Ratna Priya Pradhan, Adv. M/S. Mitter & Mitter Co., AOR

An employer cannot use 'unsatisfactory performance' as a facade to terminate a probationer for unproven misconduct. Such termination is stigmatic and punitive; when founded on misconduct rather than mere unsuitability, failure to grant an inquiry violates natural justice, necessitating judicial invalidation of the order.

Headnote:(A) Service Law - Probationary period - Termination simpliciter vs. punitive - An employer’s discretion to terminate a probationer is not absolute or unchecked. When a termination order is disguised as a simple removal for unsatisfactory performance but is in reality founded on allegations of misconduct, it becomes stigmatic and punitive, necessitating compliance with the principles of natural justice and due process. (Paras 20, 21, 41)

(B) Judicial Review - Scope and ambit - In determining whether a termination is simpliciter or punitive, the court must look beyond the form of the order to the underlying substance. If a termination during probation is triggered by unproven misconduct, the order is legally unsustainable if it avoids the requirement for a formal inquiry by instead relying on a purported lack of performance. (Paras 42-45)

Facts of the case:
An employee serving on probation was subjected to multiple extensions of the probationary period following allegations of unauthorized handling of documents. Despite reserving the right to conduct a disciplinary inquiry, the employer failed to initiate one and subsequently terminated the employee citing unsatisfactory performance. The lower court quashed the termination, finding it was predicated on arbitrary considerations and ignored positive service performance. The employer challenged this rejection before the higher court.

Findings of Court:
The court concluded that the employer employed a facade of 'unsatisfactory performance' to terminate the employee under the guise of an order of termination simpliciter, effectively bypassing the formal disciplinary process. Because the primary basis for the termination remained the unproven allegations of misconduct, the action was deemed a punitive dismissal without a fair opportunity for the employee to defend against such claims, violating basic administrative fairness.

Issues: Whether the termination of a probationer based on unproved allegations of misconduct without a formal enquiry constitutes a punitive action, and whether the court is empowered to look behind the language of a termination order to discern its true foundation.

Ratio Decidendi: Discretion to discharge a probationer is limited by the requirement of non-arbitrariness. If a termination is founded on stigma or misconduct, it must be supported by a fair inquiry. Where the employer uses a simple termination order to mask disciplinary actions for which they refused to conduct an inquiry, the termination is punitive and fails the test of legality.

Result: Appeal dismissed; the employer is ordered to pay 50% of the backwages and consequential benefits up to the date of superannuation.

Table of Content
1. factual and procedural history of the employment termination dispute. (Para 1 , 2 , 3 , 4 , 5 , 6 , 7 , 8 , 9)
2. summary of rival arguments regarding termination of a probationer. (Para 10 , 11 , 12 , 13 , 14 , 15 , 16 , 17 , 18)
3. constitutionally mandated requirements for fairness in probation termination. (Para 19 , 20 , 21 , 22 , 23 , 24)
4. evidentiary analysis of performance memos to determine arbitrary termination. (Para 25 , 26 , 27 , 28 , 29 , 30 , 31 , 32 , 33 , 34 , 35 , 36)
5. discriminatory termination as punitive action under the motive versus foundation test. (Para 37 , 38 , 39 , 40 , 41 , 42 , 43 , 44 , 45)
6. granting relief and clarifying compliance obligations for the appellant. (Para 46 , 47 , 48 , 49)

JUDGMENT :

J.K. Maheshwari J.

1. The present appeal is directed against the impugned final judgment dated 16.10.2015 of the High Court of Calcutta passed in APO No. 30 of 2013, dismissing the appeal preferred by the Appellant – Bank of Baroda (hereinafter referred to as ‘Bank’) against the order dated 18.10.2012 passed by Single Bench in W.P. No. 2177 of 2005 preferred by Respondent No. 1 – employee. The Single Bench had allowed the writ petition and quashed the order of termination of the employee noting that it was vitiated on the account of irrelevant considerations.

FACTS

2. Bereft of unnecessary details, the facts are that the Respondent No. 1 was appointed to the post of Assistant General Manager (AGM), Networking on probation for a period of one year from the date of joining of Bank, which was extendable by a maximum period of one year. The confirmation of the Respondent No. 1 in the service was subject to satisfactory performance and conduct.

3. The Respondent No. 1 joined the Bank on 05.01.2004 and after expiry of one year of service, he was not confirmed. Vide office order dated 15.01.2005, the Respondent No. 1 was placed under suspension with immediate effect on the allegation of making an attempt to take away four boxes of files containing highly confidential tender documents relating to ‘Manageable Switch Tender’ from his office cabin at DIT, HO, unauthorizedly through his driver. He was further directed not to enter the premises of Bank without the written permission of the concerned authority except for the purpose of receiving monthly allowances. His probation was extended for another six months on 16.02.2005 w.e.f. 05.01.2005 on the premise that his work was not found satisfactory during the initial year of probation.

4. On 03.03.2005, the Bank sought reply from Respondent No. 1, which was furnished on 09.03.2005. Later, upon review, by order dated 12.04.2005, the Bank revoked the suspension of the Respondent No. 1 without prejudice to its right to initiate disciplinary enquiry. The Respondent No. 1 re-joined the duty on 13.04.2005, however he was transferred to Regional Office of the Bank at Kolkata. On 04.07.2005, probation of Respondent No. 1 was further extended for a period of 6 months citing unsatisfactory performance.

5. On 05.11.2005, services of Respondent No. 1 were terminated by the Bank under Regulation 16(3)(a) of Vijaya Bank (Officers’) Regulations, 1982 (for short “1982 Regulations”) read with Clause 3 of Offer of Appointment dated 17.12.2003 on the ground that his services during the entire period of probation were not satisfactory.

6. Aggrieved, Respondent No. 1 filed writ petition bearing W.P. No. 2177 of 2005 before the High Court of Calcutta challenging the termination order dated 05.11.2005. The learned Single Judge allowed the writ petition vide order dated 18.10.2012 and held that the order of termination was based on irrelevant considerations and non-consideration of relevant factors, assigning the reasons: (1) the Respondent No. 1 was placed under suspension during suspension followed by a show-cause notice. The said suspension was revoked without prejudice of the bank to initiate disciplinary proceedings. In absence of initiation of disciplinary proceedings,

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