TaxTMI 
TaxTMI 
2008 (4) TMI 674
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....n your training, passing Bank's confirmation test and receipt of satisfactory report from the Police authorities about your character and antecedents. You may also be required to pass a test in a language other than your mother tongue before confirmation. 3. During the period of probation your services can be terminated by giving one month's notice or payment of one month's emoluments in lieu thereof. The Bank may, however, in its discretion extend your probation by a further period not exceeding one year. If you desire to leave the services of the Bank at any time during the period of probation, including the extended period thereof, if any, you shall give a month's notice or in lieu thereof, you shall pay a month's emoluments to the bank." 4. She joined the services of the Bank immediately thereafter. Pursuant to the condition that she must pass the confirmation test, she appeared in the said examination on 29th May, 1988. She did not pass the said examination. She was, however, again asked to appear in the examination on 1st October, 1989. By a letter dated 5th September, 1989 she expressed her inability to do so, stating :- ....
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....1989, you have been advised to appear for the test but you had remained absent. Although the Bank would have been justified in terminating your services in accordance with your terms of appointment, a lenient view was taken and you were given a last and final opportunity for qualifying the confirmation test in August, 1990. You appeared in the Bank's confirmation test held on 19.8.1990 but did not qualify the test." 7. She preferred an appeal thereagainst before the appellate authority asking for another chance to clear the confirmation test stating thatsimilarly situated employees including one Indubala had been given another chance to appear at the examination. However, the said appeal was dismissed by an order dated 28th November, 1990. 8. She filed a writ petition before the High Court, inter alia, contending:- i) In terms of the Punjab National Bank (Officers) Service Regulations, 1979 insistence of passing the confirmation teat was illegal. ii) As the extended period of probation expired on 28th July, 1989 she should be deemed to have been confirmed in service. iii) She had been subjected to discriminatory treatment viz-a- vis. Indubala who was granted an opportun....
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....s powers conferred upon it by Section 19 read with sub-section (2) of Section 12 of the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970, the Board of Directors of the Punjab National Bank, in consultation with the Reserve Bank of India and with the previous sanction of the Central Government made Regulations known as the Punjab National Bank (Officers') Service Regulations, 1979 (for short Regulations). Applicability of the said Regulations to the case of the writ petitioner is not in dispute. 14. Regulations 15, 16 and 36, which are relevant for our purposes may be noticed. In terms of sub-regulation (1) of Regulation 15, the period of probation is two years. Sub-regulation (1) of Regulation 16 provides for confirmation of service, if in the opinion of the competent authority, the officer has satisfactorily completed the training in any institution to which he might have been deputed for training and in the in-service training in the bank. The proviso appended thereto provides for passing a test in a language other than the mother tongue of the office. Sub-regulation (2) of Regulation 16 provides for extension of the period of probation only in the eve....
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....non compliance of the conditions laid down under sub- regulation (1) of Regulation 16, namely failure to complete satisfactorily either or both the trainings referred to therein or passing of a language test, the period of probation can be extended. The statute mandates that it can be extended for a period not exceeding one year. The total period of probation, therefore, can be three years and not more. No doubt for confirming the services of an officer of the bank, the competent authority must satisfactorily form an opinion that the officer had completed the trainings in any institution to which the officer had been deputed as also the in-service training in the bank. It is not the case of the appellant-bank that the proviso appended thereto is applicable in the case of the writ petitioner. 20. Extension of the period of probation limited to one year, however, is circumscribed by the conditions specified in sub-regulation (2). What is apparent, has been made explicit by sub-regulation (3) as the competent authority has to form an opinion that the officer is not fit for confirmation only within the period of probation including the period of extension and not beyond the same. ....
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....terms :- "6(3) On the completion of the period of probation the authority competent to make appointment may confirm the member in his appointment or if his work or conduct during the period of probation has been in his opinion unsatisfactory he may dispense with his services or may extend his period of probation by such period as he may deem fit or revert him to his former post if he was promoted from some lower post. Provided that the total period of probation including extensions, if any, shall not exceed three years." In view of the said Rule it was held :- "This Court has consistently held that when a first appointment or promotion is made on probation for a specific period and the employee is allowed to continue in the post after the expiry of the period without any specific order of confirmation, he should be deemed to continue in his post as a probationer only, in the absence of any indication to the contrary in the original order of appointment or promotion or the service rules. In such a case, an express order of confirmation is necessary to give the employee a substantive right to the post, and from the mere fact that he....
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.... the present case does not mean that the implied extension of the probationary period is only between two and three years. The explanation on the contrary means that the provision regarding the maximum period of probation for three years is directory and not mandatory unlike in Dharam Singh case and that a probationer is not in fact confirmed till an order of confirmation is made." (Emphasis supplied) 26. In Om Parkash Maurya vs. U.P. Coop. Sugar Factories Federation : (1986) Suppl. SCC 95 following Dharam Singh, this Court held :- "4. In the instant case the order of appointment promoting the appellant to the post of Commercial Officer merely indicated that his probationary period could be extended and he could be reverted to the post of Office Superintendent without any notice. Stipulation for extension of probationary period in the appointment order must be considered in accordance with the proviso to Regulation 17(1) which means that the probationary period could be extended for a period of one year more. Indisputably on the expiry of the appellant's initial probationary period of one year, the appointing authority extended the same for another period of one year which al....
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....aining and pass such departmental examinations during the period of his probation as may be prescribed. (4) and (5) are not relevant, hence omitted. (6) On the successful completion of probation and the passing of the prescribed departmental examinations, the probationer shall be confirmed in the services or post to which he has been appointed." 29. The note appended to sub-rule (2) of Rule 8 as also sub-rule (6) thereof made all the difference. In terms of note appended to sub-rule (2) a legal fiction was created in terms whereof upon completion of the extended period of probation the employee would have been continued in service, subject to the condition that the same would be terminable on the expiry of a notice of one calendar month and furthermore an express order confirming the service would be necessary. In the aforementioned situation Dharam Singh (supra) and Om Prakash Maurya (supra) were distinguished opining :- "6. Exercise of the power to extend the probation is hedged with the existence of the rule in that regard followed by positive act of either confirmation of the probation or di....
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.... the case of the appellant bank. It, with utmost respect, did not lay down the correct law and is, therefore, liable to be over-ruled. 32. So far as the question of discrimination meted out to the writ petitioner is concerned, we may notice that the High Court had come down heavily on the bank and, in our opinion, rightly so. 33. In the affidavit affirmed by one Rabi Shankar Sabat (Manager Personnel) of the Bank the Indubala case was sought to be distinguished stating:- "5. That as regards the case of petitioner vis-`-vis case of one Ms. Indubala is concerned it is submitted that both the cases stand absolutely on different footing. Ms. Indubala is not a batchmate of petitioner. Ms. Indubala joined the bank as Management Trainee on 12.11.1984 and she was called for confirmation test of Management Trainee held by the bank on 13.7.1986. She did not appear in the said test. She was given another chance for confirmation test held on 26.4.1987 who appeared in the said test but failed. Ms. Indubala was again called for confirmation test held on 29.5.1988, as per the decision of the Executive Committee of the bank, howe....
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....s occasions. That is the reason why she could not appear in the test. When she was called upon to appear for the third examination, she having undergone caesarian delivery, she was advised rest by the doctor. At the time of her examination, her son was only six month's old and was not keeping good health. 36. Submission of the Bank is that the competent authority had formulated a policy of not permitting anybody to appear the in the test more than thrice. Strong reliance in this behalf is placed on the decision of the Executive Committee of the Bank dated 19th June, 1990 deciding that maximum number of 3 chances should be given to the Management Trainee for qualifying in the confirmation test failing which services of the probationer be terminated. 37. Regulation does not speak of any confirmation test. The offer of appointment does not speak about the number of chances to be given for passing the confirmation test. A decision was taken in this behalf when the writ petitioner had already appeared on one occasion. The decision even otherwise was to give atleast three opportunities to a candidate must be real and effective one. Such a contention must be considered having regard....
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....ch. Where an act is arbitrary it is implicit in it that it is unequal both according to political logic and Constitutional law and is therefore violative of Article 14, and if it affects any matter relating to public employment, it is also violative of Article 16. Articles 14 and 16 strike at arbitrariness in State action and ensure fairness and equality of treatment. They require that State action must be based on equivalent relevant principles applicable alike to all similarly situate and it must not be guided by any extraneous or irrelevant considerations because that would be denial of equality. Where the operative reason for State action, as distinguished from motive inducing from the antechamber of the mind, is not legitimate and relevant but is extraneous and outside the area of permissible considerations, it would amount to mala fide exercise of power and that is hit by Articles 14 and 16. Mala fide exercise of power and arbitrariness are different lethal radiations emanating from the same vice : in fact the latter comprehends the former. Both are inhibited by Articles 14 and 16." It was further held: "It is also necessary to point out that the ambit and reach of Arti....
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....icro-distinctions are false to our egalitarian faith; and over-doing of classification would be undoing of equality. The Court has to function always as a sentinel on the qui vive." Thus, dismissing the writ petition, it was held that a harmony would thus be struck, by maintaining reasonableness in the ratio, between the call of social justice and the need for higher education, without in any way jeopardising the principal object of classification, by the impugned rule. 41. In T. Sham Bhat vs. Union of India (UOI) and Anr. 1994 Supp (3) SCC 340, the vires of Regulation 2 of the Indian Administrative Service (Appointment by Selection) Second Amendment Regulations. 1989 - the IAS Second Amendment Regulations was challenged before this court. It inter-alia referred to the following judgments: "16. Venkatashwara Theatre vs. State of Andhra Pradesh and Ors. : (1993) 3 SCC 677, is a decision of this Court which points out, as to how discrimination can arise, if persons who are unequals are treated as equals, thus: "Just as a difference in the treatment of persons similarly situate leads to discrimination, so also discrimination can arise if persons who are unequals, i.e...different....
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....ual treatment consistent with the principles of natural justice. Any law made or action taken by the employer, corporate statutory or instrumentality under Article 12 must act fairly, justly and reasonably. Right to fair treatment is an essential inbuilt of natural justice. Exercise of unbridled and uncanalised discretionary power impinges upon the right of the citizen; vesting of discretion is no wrong provided it is exercised purposively judiciously and without prejudice. Wider the discretion, the greater the chances of abuse. Absolute discretion is destructive of freedom than of man's other inventions. Absolute discretion marks the beginning of the end of the liberty. The conferment of absolute power to dismiss a permanent employee is antithesis to justness or fair treatment. The exercise of discretionary power wide of mark would bread arbitrary, unreasonable or unfair actions and would not be consistent with reason and justice. The provisions of a statute, regulations or rules that empower an employer or the management to dismiss, remove or reduce in rank of an employee, must be consistent with just, reasonable and fair procedure. It would, further, be held that right to public....
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....amentary Act. Regulations framed by the Board of Directors of the Bank fail to provide for grant of maternity leave and other benefits to which a woman employee would be entitled to in terms of the Maternity Benefit Act, 1961. A subordinate legislation, as is well known, must be made in conformity with the Parliamentary Act. 45. In Bombay Dyeing and Mfg. Co. Ltd. vs. Bombay Environmental Action Group and Ors. : (2006) 3 SCC 434, this court opined: "By reason of any legislation whether enacted by the legislature or by way of subordinate legislation, the State gives effect to its legislative policy. Such legislation, however, must not be ultra vires the Constitution. A subordinate legislation apart from being intra vires the Constitution, should not also be ultra vires the parent Act under which it has been made. A subordinate legislation, it is trite, must be reasonable and in consonance with the legislative policy as also give effect to the purport and object of the Act and in good faith." 46. Similarly, in Vasu Dev Singh and Ors. vs. Union of India and Ors. : 2006 (11) SCALE 108, wherein the Validity of Section ....
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....It is from that point of view that the writ petitioner's case ought to have been considered vis-a-vis Indubala. If the appellate authority was entitled to exercise its power of relaxation, which in the absence of any statutory interdict (presumably it was entitled to), it should have considered the case of the petitioner vis-`-vis Indubala, whose case, was rightly been found by the High Court stood at a much weaker foundation. Thus, Article 14 must be held to have been violated; the power of relaxation having been conceded to the appellate authority. 48. This aspect of the matter has been considered by this Court in Nehru Yuva Kendra Sangathan vs. Mehbub Alam Laskar : 2008 (1) SCALE 590. "A 'State' within the meaning of Article 12 of the Constitution of India should have placed full facts before the High Court. Only in its anxiety to show that the case of Ajay Kumar Gupta was different from that of the respondent, it came out with the truth that the respondent was guilty of a serious misconduct." 49. We are not unmindful that as a positive concept, Article 14 would not apply in illegality. 50. In Nagar Mahapalika, Kanpur vs. Smt. Vibha Shukla and Ors.: 2007 (8) SCALE 361, ....