Contract Employee Under Statutory Disciplinary Rules Cannot Be Terminated For Misconduct Without Departmental Enquiry; Gauhati HC
Sanchayita Lahkar
The Gauhati High Court Division Bench of Chief Justice Ashutosh Kumar and Justice Arun Dev Choudhury dismissed the State authorities’ appeal and upheld an order setting aside the termination of a fixed-term contractual Project Officer engaged under the Assam State Disaster Management Authority. The Court affirmed the direction to reinstate the employee, while allowing the employer to either initiate fresh disciplinary proceedings or take a fresh decision on renewal of the contract. The dispute arose after the contractual employee was removed on allegations of unauthorised absence and indiscipline. The Bench held that where a contractual appointment expressly adopts statutory disciplinary rules, termination founded on alleged misconduct is punitive and cannot be sustained without conducting the prescribed enquiry procedure under those rules.
The dispute arose from the termination of a fixed-term contractual employee engaged as a Project Officer (Disaster Management) under the Assam State Disaster Management Authority. The employee had been serving on successive contractual engagements and was posted with the District Disaster Management Authority at Hailakandi. In August 2018, he left his place of posting due to the serious illness of his father after orally informing his superiors, intending to submit a formal leave application later. His continued absence from 21 August 2018 was treated by the authorities as unauthorised.
A show-cause notice was issued alleging gross indiscipline and unauthorised absence, to which a reply was submitted. Finding the reply unsatisfactory, the authorities terminated his contractual engagement by an order dated 17 November 2018. The employee challenged the termination before the High Court, contending that his engagement letter expressly subjected him to the Assam Services (Discipline and Appeal) Rules, 1964, and that termination amounted to a major penalty imposed without holding a departmental enquiry as required under those Rules.
The Single Judge allowed the writ petition and directed reinstatement with liberty to the authorities to proceed afresh in accordance with law or to take a decision on renewal of the contract. The State authorities challenged this decision by filing an intra-court writ appeal.
The Division Bench recorded that “it is not in dispute that the respondent was engaged on a fixed-term contractual basis.” It further noted that “equally undisputed, however, is the fact that the very terms of engagement expressly subjected the respondent to the Rules, 1964.”
The Court observed that “once the employer, by a conscious contractual stipulation, chooses to incorporate Statutory Service Rules governing discipline and penalties, it cannot thereafter be heard to contend that such Rules would apply only selectively or in a truncated manner.” It further stated that “incorporation of Rules, 1964, into the contract is not an empty formality; it has binding legal consequences for both the contracting parties.”
Referring to the procedure prescribed under the Assam Services (Discipline and Appeal) Rules, 1964, the Bench recorded that “Rule 9 of the Rules, 1964 clearly contemplates that imposition of a major penalty can only be preceded by a regular departmental enquiry, which includes framing of definite charges affording reasonable opportunity of defence and adherence to the principles of natural justice.”
On the nature of the termination, the Court observed that “termination of service, on the ground of ‘gross indiscipline’ or ‘unauthorised absence’ howsoever is worded, is punitive in nature and carries civil consequences.” It further recorded that “such termination cannot be camouflaged as a mere non-renewal or secession of the contract, particularly when the foundation of the action is alleged misconduct.”
The Bench rejected the argument that the Rules did not apply fully to contractual employees, stating that “the issue here is not whether contractual employees, as a class, are entitled to protection of statutory Service Rules, but whether the employer, having voluntarily extended the applicability of those Rules by contract, can unilaterally resile from them when it comes to imposing a major penalty.” It concluded that “in our considered view, the answer must be in negative.”
Addressing reliance on precedents cited by the appellants, the Court recorded that “the reliance placed by the appellants on the decision holding that no enquiry is required for pure contractual employment is misplaced.” It clarified that “those authorities apply to situations where the contract permits termination simpliciter without attributing misconduct and where no statutory or contractual obligation to follow disciplinary rules exists.”
Finally, the Bench observed that “the learned Single Judge has carefully balanced the equities by granting reinstatement with liberty to the authorities to either initiate disciplinary proceedings strictly in accordance with law or take a fresh decision regarding the renewal of the contract.” It further stated that “such a direction neither confers any indefeasible right of continuation nor forecloses the employer's legitimate authority.”
The Court recorded that “we find no infirmity, legal or otherwise, in the judgment and order dated 10.09.2024.” The direction of reinstatement was upheld, with the clarification that the authorities retained liberty “to either initiate disciplinary proceedings strictly in accordance with law or take a fresh decision regarding the renewal of the contract.”
Such direction “neither confers any indefeasible right of continuation nor forecloses the employer’s legitimate authority,” and only ensured that any adverse action was taken in a manner consistent with the contractual terms and principles of fairness. The writ appeal was accordingly dismissed, and no order as to costs was made.
Advocates Representing the Parties
For the Petitioners: Mr. Jogen Handique, Learned State Counsel
For the Respondent: Mr. Md. A. J. Atia, Advocate; Ms. A. H. Atia, Advocate
Case Title: The State of Assam and Others v. Ikbal Hussain Laskar
Neutral Citation: 2026: GAU-AS:229
Case Number: WA/361/2025
Bench: Chief Justice Ashutosh Kumar, Justice Arun Dev Choudhury
