A government employee can't be kept suspended for more than three months if not formally informed about the charges, the Supreme Court said Monday.

Based on the principle of human dignity and the right to speedy trial, the landmark verdict is expected to affect lakhs of government employees across India, many of whom are under suspension for years pending departmental proceedings.

"Suspension, specially preceding the formulation of charges, is essentially transitory or temporary in nature, and must perforce be of short duration," a bench headed by justice Vikramjit Sen said.

If the charge sheet or memorandum of charges was served within three month, the suspension could be extended, it ruled.

"If it (suspension) is for an indeterminate period or if its renewal is not based on sound reasoning…, this would render it punitive in nature," the court said.