Services of appellant were terminated on the ground that his services have not been found satisfactory , did not cast any stigma on the employee and is not punitive.

A.P. Shah, C.J.

1. The appellant has challenged the decision of the learned Single Judge dismissing his Writ Petition and upholding the order passed by the Securities and Exchange Board of India, the second respondent herein, terminating the service of the appellant.

2. The appellant was temporarily appointed as an Officer in the Securities and Exchange Board of India (SEBI) on 10.4.1989. The appointment was subject to SEBI Service Regulations, 1988. Regulations 10(1) and 10(4) inter alia read as follows:

"10(1). A person directly appointed in any of the specified scales of pay shall be on probation for a period of two years.

10(4). During the first month of his probation, an employee shall be liable to be discharged at one day's notice and thereafter at one month's notice or by payment of substantive pay for one day or one month as the case may be in lieu thereof. Provided that an employee promoted from one grade/scale to another shall, during the period of probation be liable to be reverted to the grade/scale from which he was promoted."

3. While on probation, the appellant availed of leave from 31.7.1989 to 09.8.1989, again from 10.8.1989 to 13.10.1989 and again from 06.11.1989 to 05.12.1989, which was extended upto 22.12.1989 on medical grounds. On production of medical certificate, the leave was regularised. The appellant again applied for leave in the year 1990 and the leave periods upto October 1990 were regularised in November 1990. The appellant once again applied for two months leave from 03.12.1990. The leave was not sanctioned. Nevertheless, the appellant proceeded and sought for extension of leave for a further period of two months. By the order, dated 22.3.1991, he was discharged from service on the ground that his services are not found to be satisfactory. The language used in the order inter alia reads as follows:

".... During the period of probation, your services have not been found to be satisfactory. In accordance with Regulation 10(4) of SEBI Service Regulations, 1988, you are discharged from the services of SEBI with immediate effect from today, i.e. 22nd March 1991.

The crossed cheque for Rs.2,700/- (Rupees two thousand seven hundred only) bearing No.107750, dated 22nd March 1991 of State bank of Mysore, Bombay Main Branch, being one month's substantive pay in lieu of one month's notice period as required under Regulation 10(4) of SEBI Service Regulations, 1988, is enclosed."

4. According to the appellant, the order was punitive and cast a stigma on the appellant and could not be sustained without a full-scale departmental inquiry. It has been argued that the termination order was founded upon allegations of misconduct against the appellant. In support of his submission that the order was punitive, reliance is placed on the letter, dated 19.9.1990, wherein it was stated that his action of not accepting official communication amounts to an act of highest disobedience, which shall be pursued separately. It was further stated in the said letter that the appellant's leave record has been far from satisfactory. It is submitted that if the appellant had been given an opportunity of being heard by the second respondent before giving the finding of alleged disobedience, he could have explained that the official communication alleged to have been sent on 13.7.1990 rejecting his leave application was not received by him and thus the order is violative of the principles of natural justice and is punitive in nature.

5. The learned counsel appearing for the SEBI submitted that there is absolutely no basis for contending that the termination of service was by way of punishment imposed by the respondents. It was a discharge simpliciter and not a punitive action. The learned counsel further submitted that out of 331 days, the appellant was granted 258 days of Extraordinary Leave without pay and allowances and his period of probation could have automatically expired on 09.4.1991. The service of the appellant has been