U O I vs BIHARI LAL SIDHANA

The Supreme Court addressed the validity of the termination of a cash clerk's services under Rule 5(1) of the Central Civil Services (Temporary Services) Rules, 1965, following allegations of misappropriation. The Court held that the termination was illegal as it was executed without a proper inquiry and carried a stigma due to the mention of suspension. The Court upheld the Division Bench's decision to award compensation of Rs. 2.50 lakhs instead of reinstatement, emphasizing that acquittal in a criminal case does not automatically entitle an employee to reinstatement in service.