2026 Supreme(Gau) 1013

THE GAUHATI HIGH COURT, (HIGH COURT OF ASSAM, NAGALAND, MIZORAM AND ARUNACHAL PRADESH)
SANJAY KUMAR MEDHI, J.
Subodh Kuamr Rai, Son of Shri Ramji Rai – Petitioner 
Versus 
The Arunachal Pradesh Rural Bank, represented by its Board of Directors and Anr. – Respondents 
WP(C)/2 of 2026
Decided On : 07-04-2026

A probationer in the banking sector has no right to confirmation; once the appointing authority forms an opinion that the individual is unsuitable due to admitted misconduct or unsatisfactory performance, the employer may terminate the service under governing regulations without a full departmental inquiry.

Headnote:(A) Constitution of India - Article 226 - Service Laws - Probationer - Termination - Principles of natural justice and public trust - An employee on probation does not have a vested right to be confirmed in service; where regulations authorize the appointing authority to terminate services upon finding a candidate unfit for confirmation, such action is valid if based on overall performance and integrity. (Paras 14, 15)

(B) Banking Services - Standard of Conduct - Financial institutions operate under a doctrine of public trust; employees and officers are subject to higher standards of honesty, diligence, and accountability. Acting beyond authority, specifically regarding discretionary limits and financial protocol, constitutes fundamental misconduct jeopardizing public interest. (Paras 17, 18)

(C) Scope of Judicial Review - A court will not substitute its view for that of the appointing authority regarding the efficiency of a probationer unless the decision is arbitrary; however, to protect the interest of justice and future employability, an order of termination for misconduct may be deemed a termination simpliciter if it merely reflects unsatisfactory performance during the probationary period. (Paras 16, 20)

Facts of the case:
The petitioner, a direct recruit officer, was appointed on probation with a specific mandate for confirmation based on satisfactory work, character, and antecedents. Following the detection of several irregularities and admitted administrative misconduct, the employer issued a notice for explanation. Subsequently, the employer terminated the services citing the findings of unsatisfactory conduct and failure to meet the requirements for confirmation. The petitioner challenged the termination as stigmatic and procedurally unfair.

Findings of Court:
The court observed that the petitioner’s tenure was governed by specific regulations allowing for termination if the appointing authority determines the individual is not fit for confirmation. The petitioner had previously admitted to various acts of misconduct, and the court emphasized that banking professionals deal with public trust, necessitating high standards of integrity. The court found that the employer acted within its regulatory power and that the allegations of administrative and financial irregularities were sufficient grounds for assessing the petitioner as unfit for the permanent role.

Issues: The primary questions were whether the termination of a probationer without a full departmental inquiry violates the principles of natural justice, whether an alleged variance between the show-cause notice and the final order vitiates the termination, and whether the respondent provided a just basis for the non-confirmation.

Ratio Decidendi: The court held that once an appointing authority determines a probationer to be unsuitable based on unsatisfactory performance and admitted misconduct, the regulation allows for termination upon notice. Given the nature of banking as a profession of high trust, any act of exceeding authority is fundamentally incompatible with the position, justifying the assessment of unfitness for confirmation.

Result: The writ petition was disposed of with the direction that the termination order be treated as a termination simpliciter for the purpose of removing any stigmatic impact on future employment prospects.