ORDER D.Y. Chandrachud, J.
1. The first respondent was appointed on probation as a Principal of the High School and Junior College conducted by the petitioners at Ulhasnagar with effect from 3rd September, 2001. On 6th July, 2002 the first respondent was arrested by the Anti Corruption Bureau on the charge of having accepted a bribe of Rs. 18,000/- through his sister for giving admission to a student. He was released on bail on 8th July, 2002. The first respondent was suspended from service in exercise of the powers conferred by the Maharashtra Employees of Private Schools Rules 1981. On 29th July, 2002, a notice was received by the management from an advocate representing the father of a student from whom an amount was allegedly collected by the first respondent otherwise than in accordance with the rules as a condition for the grant of admission. It was alleged in the letter that the first respondent had collected money similarly from 22 other students. A copy of the notice having been forwarded to the first respondent, the first respondent addressed a letter dated 31st July, 2002 to the management. On 20th December, 2002 the management once again addressed a letter to the first respondent calling upon him to submit his explanation to certain instances of unsatisfactory work and behaviour involving the collection of donations by the first respondent. The first respondent furnished a reply on 22nd December, 2002. On 7th January, 2003 the management informed the first respondent that his work and behaviour were found to be unsatisfactory, in that, according to the management, the reply of the first respondent showed the admission of ineligible students and the collection of donations for the grant of admission. A resolution was passed by the Governing Board of the Hyderabad (Sind) National Collegiate Board resolving to terminate the services of the first respondent during the period of probation with effect from 4th February, 2003. Accordingly on 4th February, 2003 the first petitioner addressed a communication to the first respondent informing him that his services as Principal would not be required and that they stood terminated with immediate effect. A cheque in the amount of Rs. 13,788/- was forwarded to the first respondent being one month's salary in lieu of notice.
2. The order of termination was challenged by the first respondent before the School Tribunal in an appeal under Section 9 of the Maharashtra Employees of Private Schools (Conditions of Service) Regulation Act, 1977. The Tribunal allowed the appeal by its order dated 14th September, 2005 and came to the conclusion that though the order of termination was of termination simpliciter, the resolution passed by the Governing Body showed that the first respondent came to be removed on account of his unsatisfactory work and behaviour. The Tribunal ruled that the reference to the work being unsatisfactory was not punitive, but reference to unsatisfactory behaviour was stigmatic and punitive. The Tribunal held that the order that was issued was ex parte and therefore invalid and in the circumstances of the case arrived at a conclusion that the termination was punitive and based on an allegation that the first respondent had collected money either from the students or from their parents. The Tribunal held that this was "a kind of offence punishable under Indian Penal Code" and "could not become a motive to issue a termination order simpliciter". The Tribunal was of the view that after the first respondent was suspended on 8th July, 2002 his services were terminated after a lapse of seven months which showed that a disciplinary enquiry had been dropped and the order of termination was issued on the basis of an ex parte enquiry. The management has consequently been directed to reinstate the first respondent together with consequential benefits including backwages.
3. On behalf of the petitioners, it has been submitted that the order of the Tribunal suffers from a clear error apparent on the face of the record. It was urged that the management was, during the period of probation, duty bound in law to assess whether the conduct, behaviour and the work of the probationer was or was not satisfactory. Though the first respondent was suspended under Rule 33(5) of the MEPS Rules, consequent upon his arrest on a criminal charge, the management could have but was not bound to initiate disciplinary proceedings and pursue them to the logical conclusion. On the contrary it was urged that it was open to the management not to press the disciplinary proceedings and upon the assessment of the conduct or behaviour of the first respondent to proceed to terminate him from service by an order of termination simpliciter. On the basis of the law laid down by the Supreme Court, it was urged that in the present case the reasons which have weighed with the Tribunal cannot possibly be sustained in support of the finding that the order of termination is vitiated.
4. On the other hand Counsel appearing for the first respondent submitted that (i) Once an order of suspension was passed by the management, the authorities were duty bound to follow the procedure of a disciplinary enquiry to its logical conclusion; (ii) The memos that were issued to the first respondent, the order of suspension and the resolution of the management showed that the allegations of misconduct are the basis of the order of termination; (iii) The resolution of the management was brought on the record of the Tribunal by the management itself which would show that the real foundation of the order was a misconduct committed by the first respondent; and (iv) A period of eight months was allowed to lapse after the order of suspension during which period several memos were issued to the first respondent after which the order of termination came to be passed. These submissions were urged in support of the contention that the order of termination is in the nature of a punitive action for misconduct.
5. A considerable body of case law has evolved around the question as to whether an allegation of misconduct constitutes a motive for or on the other hand forms the foundation of an order of termination of the services of a probationer. The Court has to determine, on the basis of the order of termination and the surrounding circumstances whether the termination is punitive. Under Section 5(2) of the Maharashtra Employees of Private Schools (Conditions of Service) Regulation Act, 1977 every person who is appointed to fill a permanent vacancy is to be placed on probation for a period of two years. The statute provides for a deemed confirmation on the completion of the period of probation subject to the provisions of Sub-sections (3) and (4). Sub-section (3) of Section 5 provides as follows:
5(3) If in the opinion of the Management, the work or behaviour of any probationer during the period of his probation, is not satisfactory, the Management may terminate his services at any time during the said period after giving him one month's notice (or salary of one month in lieu of notice.)
6. By the provisions of Sub-section (3) of Section 5, therefore, the management is during the probationary period entitled to determine whether the work or behaviour of a probationer is or is not satisfactory. Obviously for the purposes of determining whether the work or behaviour of the probationer "is not satisfactory" within the meaning of Sub-section (3) of Section 5, the management has to have regard to the entire service profile of the probationer. An assessment of whether the work or behaviour of a probationer is or is not satisfactory does not involve the casting of aspersions on the conduct of the probationer and the carrying out of the aforesaid assessment does not cast an element of stigma. Indeed, the management is duty bound to make that determination failing which a decision to terminate the services of the probationer would be liable to be characterized as arbitrary.
7. Several judgments of the Supreme Court have elaborated upon the question as to when an order terminating the services of a probationer can be regarded as punitive. The previous judgments have been referred to in the judgment of the Supreme Court in Pavanendra Narayan Venna v. Sanjay Gandhi P.G.I. of Medical Sciences 2002(1) ALL MR 302 (SC). In that case, the services of a probationer came to be extended and eventually an order of termination was passed on the ground that his services were not found to be satisfactory. It was urged before the Supreme Court that the order of termination was founded upon an allegation of misconduct and a summary enquiry had been held in which a charge-sheet had been issued to the probationer. The enquiry officer had submitted a report but immediately upon the conclusion of the enquiry an order of termination came to be passed. On the other hand, it was urged on behalf of the employer that the enquiry was merely conducted to assess the fitness of the employee for being continued on probation. The Supreme Court held that one of the judicially evolved tests to determine whether in substance an order of termination is punitive is to see whether prior to termination there was:
(a) a full scale formal enquiry (b) into allegations involving moral turpitude or misconduct (c) which culminated in a finding of guilt. If all three factors are present the termination has been held to be punitive irrespective of the form of the termination order. Conversely if any one of the three factors is missing, the termination has been upheld.
8. The Supreme Court referred to the judgment of the Constitution Bench in A.G. Benjamin v. Union of India (1967) 1 LLJ 718 (SC) in which a complaint had been received against a temporary employee. A notice to show cause why disciplinary action should not be taken against him had been sent; an enquiry officer was appointed but before the enquiry was completed, the services of the employee came to be terminated with one month's salary. The Constitution Bench upheld the order of termination and drew a distinction between a preliminary enquiry and a departmental enquiry. The Supreme Court held that a preliminary enquiry is held to satisfy the Government as to whether there was no reason to dispense with the services of the employee and should not be mistaken for a departmental enquiry which is to be held to decide whether punitive action should be taken. A similar position existed in the facts of decision in State of Uttar Pradesh v. Kaushal Kishore Shukla where complaints against an employee who was appointed on a temporary basis were received by the auditors of the employer and a summary enquiry had been held. The Supreme Court, while upholding an order of termination, held that the mere fact that an enquiry had been held prior to the order of termination did not convert the order of termination into one of punishment.
9. In Pavanendra Narayan's case (supra), the Supreme Court held that when a probationary appointment is terminated, it carries with it an element of assessment that the employee is unfit for the job. However, that by itself does not make the order stigmatic. The Supreme Court held as follows:
Generally speaking when a probationer's appointment is terminated it means that the probationer is unfit for the job, whether by reason of misconduct or ineptitude, whatever the language used in the termination order may be. Although strictly speaking, the stigma is implicit in the termination, a simple termination is not stigmatic. A termination order which explicitly states what is implicit in every order of termination of a probationer's appointment, is also not stigmatic. The decisions cited by the parties and noted by us earlier, also do not hold so. In order to amount to a stigma, the order must be in a language which imputes something over and above mere unsuitability for the job.
In that case, the Court held that the mere use of the words "work not satisfactory" would not involve a stigma. Similarly, the mere holding of an enquiry prior to the order of termination would not characterize the order of termination as punitive:
We are also not prepared to hold that the enquiry held prior to order of termination turned this otherwise innocuous order into one of punishment. An employer is entitled to satisfy itself as to the competence of a probationer to be confirmed in service and for this purpose satisfy itself fairly as to the truth of any allegation that may have been made about the employee. A charge-sheet merely details the allegations so that the employee may deal with them effectively. The enquiry report in this case found nothing more against the appellant than an inability to meet the requirements for the post. None of the three factors catalogued above for holding that the termination was in substance pur.itive exist here.
10. A similar view has been taken by a Bench of two learned Judges of the Supreme Court in Dipti Prakash Banerjee v. Satyendra Nath Bose National Centre for Basic Sciences, Calcutta . Distinguishing between the motive and the foundation of an order of termination, Mr. Justice Jagannadha Rao speaking for the Bench held thus:
If findings were arrived at in an enquiry as to misconduct, behind the back of the officer or without a regular departmental enquiry, the simple order of termination is to be treated as "founded" on the allegations and will be bad. But if the enquiry was not held, no findings were arrived at and the employer was not inclined to conduct an enquiry but, at the same time, he did not want to continue the employee against whom there were complaints, it would only be a case of motive and the order would not be bad. Similar is the position if the employer did not want to enquire into the truth of the allegations because of delay in regular departmental proceedings or he was doubtful about securing adequate evidence. In such a circumstance, the allegations would be a motive and not the foundation and the simple order of termination would be valid.
11. If the facts of the present case are considered in the light of the decided cases, the undisputed position that would emerge from the record is that the first respondent was appointed as a principal of the college on probation for a period of two years on 3rd September, 2001. The order of termination that was passed against the first respondent on 4th February, 2003 is ex facie an order of termination simpltciter. The order does not cast any aspersions on the first respondent or subject the first respondent to any stigma. That, however, would not be conclusive of the matter because the Court must still consider as to whether the foundation of the order of misconduct was punitive. Undoubtedly the first respondent had been placed on suspension on 8th July, 2002 under Rule 33(5) upon his arrest on a charge of criminal wrongdoing. The management had received complaints against the first respondent including a complaint on behalf of parents of students who alleged that monies had been unlawfully collected for the purposes of admission. The explanation of the first respondent had been called by the management. Even at this stage, however, in view of the settled position it was clearly open in law to the management to determine that it would not press ahead with a disciplinary proceeding. In the present case as a matter of fact no disciplinary enquiry was held. No occasion arose of arriving at any findings therein and the services of the employee were terminated by an order of termination simpliciter. There is therefore no merit in the submission urged on behalf of the first respondent that once the first respondent was suspended the management was bound to follow the procedure of a disciplinary enquiry to its logical conclusion. Even if the resolution that was passed by the Governing Body is read in the context of the order of termination, it cannot be held that the termination was punitive. The management for the purposes of the Act is defined in Section 2(12)(c) to mean a person or body of persons administering a school. The Governing Body of the college, as the management, was duty bound to look into the records relating to the petitioner, but that was only for the purposes of determining whether the probationer in the present case was an employee of the required level of efficiency to meet the duties and functions of the office of the principal. On a review of the material including necessarily the nature of the complaints which have been placed before the management, the management was entitled to assess whether the work and behaviour of the first respondent was satisfactory or otherwise. This assessment is in fact required under Section 5(3) if the management is to sustain an order not to continue the services of a probationer.
12. The Tribunal has placed a considerable degree of emphasis on the fact that a notice was issued by an advocate to the management on 20th December, 2005 making allegations against the first respondent and there were letters which were on the record of the Governing Body which adverted to the alleged collection of money by the first respondent from the students/parents. In circumstances such as the present, the mere fact that he management is confronted with material adverse to a probationer cannot be a reason to hold that the order of probation is stigmatic. Obviously, the management cannot turn a blind eye to the material brought to its notice, but clearly, in law, there are two courses of action which are open. The management may decide to adopt a full fledged departmental enquiry and enquire into the allegations of misconduct. In such a case the action would be punitive if a full fledged enquiry were to be held involving allegations of misconduct and a finding of guilt were arrived there at. In such a case if termination takes place upon a finding of guilt, the termination would have to be regarded as punitive irrespective of the form of the order. That is however not the case here. In the present case, the management decided not to hold or convene disciplinary proceedings and it was clearly open to the management to adopt the alternate course of taking recourse to a termination simpliciter on an over all review of the work or conduct of the first respondent. The Tribunal has placed a considerable degree of emphasis on the time gap which ensued between the order of termination and suspension. That cannot be a conclusive factor. The Tribunal has sought to draw a distinction between the expression 'unsatisfactory work' which is characterized as not punitive and 'unsatisfactory behaviour' which the Tribunal records as stigmatic. This conclusion is directly in the teeth of Section 5(3) of the Act which requires an assessment of the work and behaviour of the probationer.
13. For all these reasons I am of the view that the approach of the Tribunal was completely unsustainable and that the impugned order has to be quashed and set aside. The petition is accordingly allowed. The judgment and order of the Tribunal dated 14th September, 2005 is set aside. Rule is accordingly made absolute in terms of prayer clause (a).
14. In view of the disposal of the petition, the Civil Application does not survive and is accordingly disposed of.