2025 INSC 218 REPORTABLE

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO.13834 OF 2024

MAHARASHTRA STATE ROAD TRANSPORT

CORPORATION … APPELLANT

Versus

MAHADEO KRISHNA NAIK … RESPONDENT

J U D G M E N T

DIPANKAR DATTA J.

THE APPEAL

1. This appeal by the Maharashtra State Road Transport Corporation

1

,

by special leave, is directed against the judgment and order dated

30

th

November 2018

2

of Hon’ble S.C. Gupte, J.

3

of the High Court of

Bombay

4

allowing a petition for review

5

of his earlier order dated 7

th

February 2017 of dismissal of a writ petition

6

instituted by the

respondent

7

. The single judge not only set aside the order of

dismissal of the writ petition passed by him but also set aside the

award passed against Mahadeo by the 4

th

Labour Court at Mumbai

8

.

1

Corporation

2

impugned order

3

single judge

4

High Court

5

Review Petition No. 18 of 2018

6

Writ Petition No. 154 of 2007

7

Mahadeo

8

Labour Court

2

While so reviewing, the single judge also directed the Corporation to

pay all benefits and emoluments including back wages to Mahadeo.

2. The Corporation has taken exception to the impugned order and

contends that the High Court erred in interfering with the decisions

of the Writ Court and the Labour Court in its review jurisdiction.

FACTUAL MATRIX

3. The facts emerging from a perusal of the records would reflect that

Mahadeo was appointed by the Corporation as a bus driver on 19

th

April, 1988. The incident which formed the genesis of the present

proceedings occurred on 10

th

May 1996. A lorry coming from the

opposite direction collided at about 22.45 hours with a bus of the

Corporation, driven by Mahadeo, resulting in a fatal accident. Two

passengers travelling on the bus succumbed to their injuries while

several others (around ten) suffered injuries. The monetary loss to

the Corporation arising from the accident was calculated at Rs.

45,000/.

4. As a consequence of this accident, disciplinary action followed

against Mahadeo. Consequent upon an inquiry, the Divisional Traffic

Officer

9

dismissed Mahadeo from service of the Corporation on 27

th

May, 1997. Aggrieved by his dismissal, Mahadeo preferred a

departmental appeal which proved abortive. The Union of which

Mahadeo was a member, thereafter, raised an industrial dispute. A

9

disciplinary authority

3

reference was made by the Deputy Commissioner of Labour

requiring the Labour Court The Labour Court, upon considering the

evidence led and hearing the parties to the dispute, held that the

inquiry conducted was fair

10

; the findings of the inquiry officer were

not perverse

11

; and the punishment inflicted was in proportion to

the misconduct proved; therefore Mahadeo was not entitled to

reinstatement in service. Resting on these findings, the Labour

Court answered the reference by holding that Mahadeo was not

entitled to any relief

12

.

5. Crestfallen, Mahadeo invoked the writ jurisdiction of the High Court

by applying under Article 226 of the Constitution of India

13

. The

single judge dismissed the challenge observing that there was

enough material before the Labour Court to support the findings of

the Inquiry Officer and hence, no interference was warranted.

6. While the reference and then the writ petition was pending,

proceedings for compensation had been initiated by the family

members of the deceased and injured victims of the road accident

under the Motor Vehicles Act, 1988

14

before the Motor Accidents

Claims Tribunal at Mumbai

15

. Mahadeo, after becoming aware of the

proceedings before the MACT, more particularly the contrary stand

taken by the Corporation where the entire blame for the fatal

10

vide preliminary award dated 26

th

May, 2004

11

vide preliminary award dated 9

th

December, 2005

12

vide final award dated 16

th

May, 2006

13

W.P. 154 of 2007

14

the 1988 Act

15

MACT

4

accident was laid on the feet of the lorry driver as well as the award

of the MACT dated 9

th

July, 2004

16

, applied for review before the

High Court

17

. The review proceeding succeeded before the High

Court, triggering this appeal.

IMPUGNED ORDER

7. The single judge, in review, noticed the stand taken by the

Corporation before the MACT that the accident was entirely due to

the negligence of the lorry driver, who was driving carelessly

without observing traffic norms. It was stated before the MACT that

the driver of the lorry drove it into the Corporation’s bus and that

no fault could have at all been attributed to Mahadeo for the

accident. Furthermore, in its defence, the Corporation led evidence

before the MACT of the conductor of the bus and a passenger who

emphatically stated that the lorry driver was completely at fault for

the accident. The single judge noticed the fact that the proceeding

before the MACT culminated into a n award for compensation in

favour of the claimants therein, where the MACT recognising the

fact that the lorry driver was at fault, did not affix any liability on

the Corporation. Based on the pleadings and the evidence

presented by the Corporation, the MACT categorically held that the

accident took place because of the negligence of the lorry driver.

16

the said award

17

Review Petition No.18 of 2018

5

8. It became clear to the single judge that such relevant evidence was

suppressed before the Labour Court. This material, in the opinion of

the single judge, had a crucial and conclusive bearing on the case

before the Labour Court.

9. The single judge relied on a decision of this Court reported in

Associate Builders v. Delhi Development Authority

18

, where it

was held that disregard of a vital piece of evidence is one of the

factors to be considered wh ile examining whether an order is

perverse. The single judge further held that if the material produced

before the MACT had been produced before it, the Labour Court

would have reached a diametrically opposite conclusion than the

one it reached in the present case.

10. The Corporation contended that a conclusion reached by a claims

tribunal under the 1988 Act is not binding on the Labour Court, with

which the single judge agreed. However, the single judge held that

the Corporation had admitted in a sworn pleading that the accident

was not due to the negligence of Mahadeo. This newly produced

material, which existed when the Labour Court made its award and

the order dismissing the writ petition was made , could not be

produced by Mahadeo, yet, it was of such a clinching nature that on

the face of this material, no court could come to the conclusion that

Mahadeo was rightly dismissed from service due to gross negligence

on his part amounting to misconduct.

18

2015 (3) SCC 49

6

11. Mahadeo pleaded his inability to produce this material before as he

only became aware of the proceedings before the MACT in June,

2017 and received the certified copies of the materials by 23

rd

June

2017. This was neither challenged by the Corporation before the

single judge nor was it shown that Mahadeo, despite being aware of

the proceedings before the MACT, went into slumber.

12. Hence, recording satisfaction that a case for review had been set

up, the single judge proceeded to observe that no useful purpose

would be served by remanding the matter to the Labour Court as

the materials spoke for themselves and no case of negligence could

be made out against Mahadeo by the Corporation. Consequently,

the Corporation suffered an order for payment of all benefits and

emoluments including back wages on the basis of continuous

service of Mahadeo from the date of his wrongful termination till his

superannuation. Since Mahadeo had attained the age of

superannuation, reinstatement was denied.

13. The writ petition, thus, stood allowed on review of the earlier order

of dismissal.

CONTENTIONS OF THE PARTIES

14. On behalf of the Corporation, exception is taken to the impugned

order on the following grounds:

(i) Mahadeo was a trained driver who was responsible for the

safety of the passengers travelling in the bus. It is a fact that

7

there was extensive damage to the bus and its passengers by

the lorry and even though Mahadeo might have swerved to

avoid the collision, there was a massive impact on account of

the high speed of the bus. To bolster this submission, the

Corporation relied on a decision of this Court in T.N. State

Transport Corpn. (Coimbatore) Ltd. v. M.

Chandrasekaran

19

where it was held that the injuries caused

to the passengers and the nature of impact raises an

inference that the bus was being driven negligently by the bus

driver.

(ii) The proceedings before the MACT and the disciplinary

proceedings stand on completely different footing. The

disciplinary proceedings were aimed at examining the role of

Mahadeo in the collision, whereas the MACT proceedings

aimed to determine the negligence of the drivers involved in

the collision.

(iii) Judicial review is limited to analysis of the decision-making

process and the High Court could not have ventured into the

correctness of the decision itself. Once it has been established

that no ground for review was made out on the aspects of

fairness and propriety of the inquiry, the High Court should

not have interfered with the decision of the Labour Court.

19

(2016) 16 SCC 16

8

(iv) The single judge has substituted its view in the place of the

competent authority and erred in not remanding the matter to

the Labour Court.

(v) Full back wages have been awarded to Mahadeo without any

evidence that he was not gainfully employed during the period

from his termination to his superannuation. The single judge

erred in ignoring the fact that Mahadeo had a blemished

service record, and several punishments had been meted out

to him during his short service period. Reliance has been

placed on the decision Rajasthan State Road Transport

Corporation, Jaipur v. Phool Chand

20

to contend that it is

settled law that back wages are not automatic even if

termination is set aside; hence, the single judge erred in not

supplying reasons for award of full backwages.

15. Mahadeo, supporting the impugned order, advanced the following

arguments:

(i) The Corporation has indulged in committing fraud on the Court,

by not disclosing the fate of the judicial proceedings before the

MACT and the pleadings filed therein, to obtain favourable

orders.

(ii) Mahadeo has been fighting this legal battle since 1997 and due

to dismissal from service, he has been unable to find any other

permanent employment as a driver. He has been victimised by

20

(2018) 18 SCC 229

9

the Corporation and has suffered irreparable financial loss due

to its condemnable actions.

(iii) The impugned order of the single judge granting relief is

justified having regard to the decision of this Court in Deepali

Gundu Surwase v. Kranti Junior Adhyapak Mahavidyala

21

,

where this Court has held that if an employee is terminated on

the basis on frivolous allegations in violation of natural justice,

that in itself will be ample justification to award full backwages.

Issues

16. To our mind, the present controversy tasks us to address four

issues. The first is whether, the Corporation is guilty of suggestio

falsi by not disclosing what it had pleaded before the MACT and

suppresio veri by suppressing the said award. Depending on an

affirmative answer to the first issue, the second issue would be

whether, on facts and in the circumstances, the single judge was

justified in exercising review jurisdiction. Again, an affirmative

answer to the second issue would require serious consideration as

to whether any interference with the direction for payment of full

back wages is called for or not. Fourthly and finally, subject to our

answers to all the three issues, what would be the appropriate relief

for Mahadeo needs to be considered.

21

(2013) 10 SCC 324

10

WRITTEN STATEMENT OF THE CORPORATION BEFORE THE MACT

17. To answer the above issues, we need to appreciate what was the

nature of claim before the MACT, what precisely was the defence

raised by the Corporation to avoid liability for payment of

compensation, and what was the outcome of such proceedings.

18. The road accident taking the lives of two young children and

causing injury to several others had given rise to a First

Information Report

22

. Mahadeo was not named as an accused

therein. The driver of the lorry, involved in such accident, was the

sole accused in the FIR. This fact was known to the Corporation

from day one of the accident. The parents of Nitin Vardekar

23

, a

deceased passenger aged 17 years , had approached the M ACT

with a claim for compensation

24

under section 166 of the 1988

Act, impleading the Corporation

25

, the owner of the lorry

26

and the

insurer of the lorry

27

as opposite parties.

19. To contest the claim of the claimants, the Divisional Controller of

the Mumbai Division of the Corporation, Kurla, Mumbai filed the

written statement, on solemn affirmation, for consideration of the

MACT. Relevant passages from the said written statement read as

follows:

22

FIR

23

claimants

24

Application No. 2901/1996

25

OP - 1

26

OP - 2

27

OP - 3

11

“4. …..It is true that when the said S.T. Bus reached at Pen Phata

on Mumbai Goa Highway at Nagothane at about 22:45 hrs on

10.05.1996 at that time one M/Lorry bearing Registration no.

MRL 8226 came from the opposite direction in a very fast speed

and in rash and negligent manner and gave heavy dash to the

driver side of the S.T. Bus. It is also true that due to the said

impact, the right side of the S.T. was cut off and the deceased

who was sitting on the right side in the said S.T. Bus sustained

injuries.

5. With reference to para 22(ii) of the application, this and by the

correct side of the road (sic). The said S.T. Bus was fully under

the control of the Bus Driver of this Opp. Party. When the said

S.T. Bus came near Pen Phata, at Nagothane, at that time one

M/Lorry bearing registration no. MRL8226 which was being driven

by the driver of the Opp. Party No. 2, at a fast speed, rashly,

negligently and without any care, caution and proper lookout

from the opposite direction of the S.T. Bus, could not control his

vehicle, came on the wrong side of the road and dashed against

the bus very heavily. The impact was so heavy that the right

portion of the S.T. Bus from the driver’s side was tore and the

passenger i.e. the deceased sustained injuries. The S.T. Bus

driver, on seeing the M/Lorry coming towards the bus, tried to

save his vehicle to his left side to avoid the accident. However, as

the driver of the Opp. Party No.2 came abruptly in front of the

bus in a rash and negligent manner, it came in contact of the

right side of the S.T. sustained injuries and was removed to the

hospital. It will this be observed that there was no negligence

whatsoever on the part of the S.T. Bus driver, but it was sheer

negligence on the part of the driver of the Opp. Party No. 2 who

drove his M/lorry rashly, carelessly and Opp. Party denies that

the accident is of such a nature that it would not have taken

place but for the gross negligence and rashness of the driver of

this Opp. Party and puts the applicants to the strict proof thereof.

This Opp. Party further denies that the driver of the S.T. Bus was

rash and negligent while driving the same in as much as he drove

the said vehicle at a high, excessive and improper speed or that

he drove the said S.T. Bus without taking precautions and/or

keeping proper lookout or watch for the traffic and puts the

applicant to the strict proof thereof. This opp. Party further

denies that the driver of the S.T. Bus failed and neglected to

apply the breaks and/or failed to apply the breaks efficiently

and/or in sufficient time to avoid the accident or neglected to

manoeuvre the vehicle so as to avoid the accident and puts the

applicant to the strict proof thereof.”

(emphasis supplied)

12

AWARD OF THE MACT

20. MACT, Mumbai, considering the claim raised by the claimants and

the defence of the Corporation recorded the evidence of, inter alia,

a passenger named Anant Chindarkar

28

and the conductor of the

Corporation’s bus named Chandrakant Lokhe

29

, respectively. On

the basis of appreciation of the materials on record, the MACT

proceeded to deliver the said award. We consider it appropriate to

extract relevant passages from the said award hereinbelow:

“2. …Applicant Nos.1 and 2 are father and mother respectively of

the deceased Nitin. On 10.5.1996 the deceased was travelling by

S.T. Bus No.MH-12-Q-8712. It was going along Mumbai Goa

Highway. At about 10.45 p.m., it reached at Nagothane. At that

time, one Motor Lorry No.MRL-8226 came from the front side in

very fast speed and gave dash to the said S.T. Bus at its’s driver’s

side. Therefore, right side of S.T. Bus was cut off. The deceased

was seriously injured and died on the spot.

****

3. Opposite party No.1 M.S.R.T.C. filed written statement Exhibit-8.

It’s case is that: The said Motor lorry came on wrong side of the

road and dashed the S.T. Bus heavily. The accident occurred due to

sole negligence of the driver of the said lorry.

****

ISSUES

FINDINGS

1) Whether the Applicants prove that the accident

took place due to rash and negligent driving of Yes

vehicle No.MRL-8226?

2) Whether the Applicants prove that the deceased Yes

died in the said accident?

3) Whether the Applicants prove that they are entitled Yes,

to compensation as alleged? Rs.1,40,000/-

****

28

P.W. 2

29

D.W. 1

13

8. Applicants examined one Anant Chindarkar as P.W.2 as an eye

witness. P.W.2 stated that: On 10.5.1996 he was accompanying the

deceased in the said S.T. Bus. Deceased was sitting on seat No.25.

Near Pen fatta, one lorry came from front side and gave dash to the

S.T. Bus. That lorry was in great speed. It hit S.T. Bus as it’s middle

portion of the right side. Therefore right side of the S.T. Bus was

torn. The deceased got injuries on his head and chest. He became

unconscious. Police came on the spot after about 15 to 20 minutes

and removed the deceased to Nagothane Rural Hospital by one

private car. P.W.2 and his friends also went to that hospital. Doctor

examined the deceased and declared him dead. Number of that

S.T. Bus is MH-12-Q-8712. Number of that lorry is MRL-8226.

****

10. Opposite party No.1 M.S.R.T.C. examined one Chandrakant

Lokhe as D.W.1. He stated that on 10.5.1996 he was conductor of

the said S.T. Bus. Accident happened near Nagothane Fatta at

about 10.45 p.m. Speed of S.T. Bus was about 30 K.M.P.H. There

was vehicular traffic on the road. The S.T. Bus was on the left side

of the road. The said lorry came from front side in great speed and

gave dash to middle portion of right side of S.T. Bus. The accident

happened because lorry came to wrong side of the road. Body of

S.T. Bus was torn. The lorry went further ahead and then

overturned. The S.T. Bus was stopped immediately after the

accident. Lorry driver was responsible for the accident.

****

13. …Spot panchnama Exhibit-23 further shows that: The said truck

No. MRL 8226 after giving dash to the S.T. Bus went towards

western side of the road. Then it hit and uprooted six stones on the

kacha road. Thereafter, it went below the road and dashed one

tree. It was standing there facing towards the road. Trucks body is

of iron. Upper side of truck’s cabin was broken and was lying near

it. It stopped about 115 feet away from the place of accident.

Driver’s side body of the truck was seen damaged.

****

16. P.W.2 Anant Chindarkar was one of the passengers in the said

S.T. Bus. That fact is not disputed by the other side. D.W.1

Chandrakant Lokhe was the conductor of the said S.T. Bus. It is

also not disputed. P.W.2 and D.W.1 were, therefore, supposed to

have personal knowledge and experience of the circumstances in

which the accident occurred. Both of them blamed driver of the said

lorry for the occurrence.

****

20. For the aforesaid reasons I find that the accident took place

because of rash and negligent driving of the said truck No.MRL-

8226. Issue No.1 is, therefore, answered affirmatively.

****

14

25. Consequently, the applicants are entitled to get total

compensation of Rs.1,40,000/ - (Rs.1,30,000 + Rs.10,000).

Admittedly: Deceased died in the accident in question. The said

motor lorry was involved in it. It was insured with the New India

Assurance Co. Ltd., on the date of the accident. The Opposite party

No.2, Ramesh Suryawanshi is owner of the said lorry. Therefore, I

find that Opposite Party No.2 and Insurer are liable to pay aforesaid

compensation of Rs.1,40,000/- to the applicants. Issue No.3 is

answered accordingly.

****

27. Hence, the following order:

ORDER

Application is partly allowed with proportionate costs.

Opposite party No.2 Ramesh Suryawanshi and the Insurer the New

India Assurance Co. Ltd. Both are ordered to pay jointly and

severally Rs.1,40,000 (Rupees One Lakh Forty Thousand Only) to

the applicants alongwith interest at the rate of 6% p.a. From the

date of the filing of the application i.e. 27.8.1996 till payment.

It is inclusive of payment under sec.140 of Motor Vehicles Act by

way of No-Fault Liability.

The case against Opposite party No.1, M.S.R.T.C. is dismissed.”

(emphasis supplied)

ANALYSIS AND REASONS

21. We now proceed to address each of the first three issues, in

seriatim, with the answer to the fourth and final issue being made

part of the answer to the third issue.

22. The Latin phrases suggestio falsi and suppresio veri embody

concepts of unethical conduct of a party having serious

consequences in various fields including law.

23. According to Black’s Law Dictionary

30

, suggestio falsi is a false

representation or a misleading suggestion while suppresio veri

30

11

th

Edition

15

connotes suppression of the truth; an indirect lie, whether by

words, conduct, or artifice. It is a type of fraud.

24. That the Corporation indulged in the misadventure of suggestio

falsi and suppresio veri is incontrovertible.

25. Before the Labour Court, the Corporation did not leave any stone

unturned to establish that not only was the inquiry conducted

against Mahadeo fair, but the conclusion arrived at in course of such

inquiry that Mahadeo was guilty of misconduct in rashly and

negligently driving the bus of the Corporation leading to loss

suffered by it was established upon due consideration of the

materials on record. Having regard to the clear and specific stand

taken before the MACT in its written statement, which has been

quoted above, the Corporation did make a false representation

before the Labour Court amounting to suggestio falsi. Also, having

not disclosed before the Labour Court the outcome of the

proceedings before the MACT, a fortiori, that it had not been found

liable to pay any compensation to the passengers who either died

and were injured based on what the version in the written

statement was and the argument advanced on its behalf to absolve

itself of any liability, the Corporation is also guilty of suppresio veri.

26. The conduct of the Corporation when Mahadeo was struggling to

find a foothold before the single judge in view of the contours of

judicial scrutiny of awards of industrial adjudicators cannot also

escape notice. Perhaps, the Corporation thought that the

16

proceedings before the MACT not having been brought to the notice

of the Labour Court by Mahadeo previously, he was blissfully

ignorant of the same and, therefore, the Corporation would steal a

march over him by not making the appropriate disclosure. The

Corporation was caught off-guard when Mahadeo produced the

written statement and the award of the MACT before the single

judge in his review petition.

27. The relevance of the MACT judgment and its probative value to the

case at hand cannot be gainsaid. To be relevant, a piece of evidence

relied on by a party must be shown to have some logical connection

to the case and its admission would be necessary to prove or

disprove a fact. Once the evidence is found to be relevant and is

admitted arises the question of its probative value. Probative value,

as is well-known, refers to the weight or persuasive power of the

evidence. It is not always necessary that a piece of evidence found

relevant to a case would still demand significant probative value. An

assessment has to be made by the court as to how convincing or

persuasive the evidence is and how effective it would be to prove or

disprove a fact.

28. We are conscious that the law of evidence per se does not apply to

industrial adjudication. Nevertheless, the general principles do

apply. In any event, in industrial adjudication, principles of natural

justice have to be complied with. Fairness in procedure has

developed as the third limb of natural justice. The manner in which

17

the Corporation conducted itself before the Labour Court does not

behove a creature of a statute. It has been far from fair in its

dealings with Mahadeo.

29. The Corporation did not deliberately refer to the award of the

MACT at two different tiers, and thereby actively suppressed

relevant material from a court of law. We do not propose to enter

the arena of controversy as to whether the award of the MACT is

binding on the Labour Court. However, the Corporation could not

have at any rate resiled from what it pleaded in its own written

statement before the MACT on a sworn affidavit and deliberately

withhold the same. This Court has always taken a serious view

against suppression of evidence in a judicial proceeding. In State of

M.P. v. Narmada Bachao Andolan

31

, a three-Judge bench of this

Court observed:

“164. It is a settled proposition of law that a false statement made

in the court or in the pleadings, intentionally to mislead the court

and obtain a favourable order, amounts to criminal contempt, as it

tends to impede the administration of justice. It adversely affects

the interest of the public in the administration of justice. Every

party is under a legal obligation to make truthful statements before

the court, for the reason that causing an obstruction in the due

course of justice ‘undermines and obstructs the very flow of the

unsoiled stream of justice, which has to be kept clear and pure, and

no one can be permitted to take liberties with it by soiling its

purity’.”

30. Even if we keep the award of the MACT aside, it is clear from the

pleadings of the Corporation before the MACT and the Labour Court

that the Corporation has attempted to get the best of both worlds.

31

(2011) 7 SCC 639

18

The contradictory nature of the stances taken by the Corporation

before the Labour Court and the MACT reeks of the Corporation

trying to approbate and reprobate on the same issue. It is bound to

cause immense prejudice to Mahadeo if the Corporation is allowed

to reverse its stance to suit its own interests. This Court in Union

of India v. N. Murugesan

32

while holding that it will be inequitable

and unfair if a party is allowed to challenge a position while

enjoying its fruits, ruled:

“26. These phrases are borrowed from the Scots law. They would

only mean that no party can be allowed to accept and reject the

same thing, and thus one cannot blow hot and cold. The principle

behind the doctrine of election is inbuilt in the concept of approbate

and reprobate. Once again, it is a principle of equity coming under

the contours of common law. Therefore, he who knows that if he

objects to an instrument, he will not get the benefit he wants

cannot be allowed to do so while enjoying the fruits. One cannot

take advantage of one part while rejecting the rest. A person

cannot be allowed to have the benefit of an instrument while

questioning the same. Such a party either has to affirm or disaffirm

the transaction. This principle has to be applied with more vigour as

a common law principle, if such a party actually enjoys the one part

fully and on near completion of the said enjoyment, thereafter

questions the other part. An element of fair play is inbuilt in this

principle.”

(emphasis supplied)

31. The Corporation, without an iota of doubt, being in the dominant

position has attempted and achieved success in stealing a march

over Mahadeo by indulging in suggestio falsi and suppressio veri.

The actions of the Corporation have resulted in Mahadeo being

robbed of a stable livelihood and has caused irreparable harm to

him. It would not behove any court, much less this Court, to allow

such free reign to a party. Omission, neglect and/or failure –

32

(2022) 2 SCC 25

19

whatever be the cause - the Corporation’s non-disclosure of what its

stand was before the MACT and what was ultimately held by the

MACT to the Labour Court as well as the single judge is suppression

of such high magnitude that it can safely be held to be akin to a

clear fraud on court.

32. It also appears to us that the actions of the Corporation were

motivated. The track record of Mahadeo would show that he had

been involved in 8 collisions before the collision with the lorry. Why

the Corporation did not get rid of Mahadeo before is best known to

it. However, wanting to get rid of Mahadeo, the Corporation on this

occasion found a convenient excuse in the collision and went ahead

to dismiss him in the most unfair manner.

33. The first issue is, thus, answered in the affirmative.

34. Moving on to the second issue, the same need not detain us for

long in view of our answer to the first issue.

35. Section 114 read with Order XLVII, CPC does permit the court to

look into any document, having a bearing on the lis decided earlier,

which was not on record because despite exercise of due diligence

the same could not be produced by a party . It would invariably

reduce to an examination as to whether the document has such

intrinsic worth that if the same had been produced , the outcome

could have been different.

36. The written statement of the Corporation filed before the MACT

and its award are documents of immense significance which were

20

sufficient to tilt the balance in favour of Mahadeo. The objection of

the Corporation to the single judge receiving such document as

evidence in course of exercise of review jurisdiction is wholly

without any substance and merits outright rejection.

37. Accordingly, the second issue too is answered in favour of

Mahadeo.

38. It is now time to consider the important point of award of back

wages.

39. There is no dearth of judicial precedents on such point. While not

referring to all the precedents, we may notice only a couple of them

here.

40. Hindustan Tin Works (P) Ltd. v. Employees

33

is a decision

rendered by a bench of three Judges of this Court. The following

passage from the judgment authored by Hon’ble D.A. Desai, J. (as

His Lordship then was) is instructive:

“9. It is no more open to debate that in the field of industrial

jurisprudence a declaration can be given that the termination of

service is bad and the workman continues to be in service. The

spectre of common law doctrine that contract of personal service

cannot be specifically enforced or the doctrine of mitigation of

damages does not haunt in this branch of law. The relief of

reinstatement with continuity of service can be granted where

termination of service is found to be invalid. It would mean that the

employer has taken away illegally the right to work of the workman

contrary to the relevant law or in breach of contract and

simultaneously deprived the workman of his earnings. If thus the

employer is found to be in the wrong as a result of which the

workman is directed to be reinstated, the employer could not shirk

his responsibility of paying the wages which the workman has been

deprived of by the illegal or invalid action of the employer.

Speaking realistically, where termination of service is questioned as

invalid or illegal and the workman has to go through the gamut of

33

(1979) 2 SCC 80

21

litigation, his capacity to sustain himself throughout the protracted

litigation is itself such an awesome factor that he may not survive

to see the day when relief is granted. More so in our system where

the law’s proverbial delay has become stupefying. If after such a

protracted time and energy consuming litigation during which

period the workman just sustains himself, ultimately he is to be told

that though he will be reinstated, he will be denied the back wages

which would be due to him, the workman would be subjected to a

sort of penalty for no fault of his and it is wholly undeserved.

Ordinarily, therefore, a workman whose service has been illegally

terminated would be entitled to full back wages except to the

extent he was gainfully employed during the enforced idleness.

That is the normal rule. Any other view would be a premium on the

unwarranted litigative activity of the employer. If the employer

terminates the service illegally and the termination is motivated as

in this case viz. to resist the workmen’s demand for revision of

wages, the termination may well amount to unfair labour practice.

In such circumstances reinstatement being the normal rule, it

should be followed with full back wages. Articles 41 and 43 of the

Constitution would assist us in reaching a just conclusion in this

respect. … “

(emphasis supplied)

41. Close on the heels of Hindustan Tin Works (P) Ltd. (supra)

came another seminal decision on entitlement to back wages by

another three-Judge Bench in Surendra Kumar Verma v. Central

Govt. Industrial Tribunal -cum-Labour Court

34

. Hon’ble O.

Chinappa Reddy, J. (as His Lordship then was) in His Lordship’s

inimitable style remarked:

“6. … Semantic luxuries are misplaced in the interpretation of

‘bread and butter’ statutes. Welfare statutes must, of necessity

receive a broad interpretation. Where legislation is designed to give

relief against certain kinds of mischief, the court is not to make

inroads by making etymological excursions. ‘Void ab initio’, ‘invalid

and inoperative’ or call it what you will, the workmen and the

employer are primarily concerned with the consequence of striking

down the order of termination of the services of the workmen. Plain

common sense dictates that the removal of an order terminating

the services of workmen must ordinarily lead to the reinstatement

of the services of the workmen. It is as if the order has never been,

and so it must ordinarily lead to back wages too. But there may be

34

(1980) 4 SCC 443

22

exceptional circumstances which make it impossible or wholly

inequitable vis-à-vis the employer and workmen to direct

reinstatement with full back wages. For instance, the industry might

have closed down or might be in severe financial doldrums; the

workmen concerned might have secured better or other

employment elsewhere and so on. In such situations, there is a

vestige of discretion left in the court to make appropriate

consequential orders. The court may deny the relief of

reinstatement where reinstateme nt is impossible because the

industry has closed down. The court may deny the relief of award of

full back wages where that would place an impossible burden on the

employer. In such and other exceptional cases the court may mould

the relief, but, ordinarily the relief to be awarded must be

reinstatement with full back wages. That relief must be awarded

where no special impediment in the way of awarding the relief is

clearly shown. True, occasional hardship may be caused to an

employer but we must remember t hat, more often than not,

comparatively far greater hardship is certain to be caused to the

workmen if the relief is denied than to the employer if the relief is

granted.”

(emphasis supplied)

42. There have been decisions of this Court rendered thereafter where

a shift in approach on awarding full back wages is clearly

discernible. However, a coordinate bench of this Court in Deepali

Gundu Surwase (supra) considered a dozen precedents on award

of back wages upon reinstatement (referred to in paragraphs 13

and 14). Speaking through Hon’ble G. S. Singhvi, J. (as His

Lordship then was), the legal position was neatly summed up in the

following words:

“22. The very idea of restoring an employee to the position which

he held before dismissal or removal or termination of service

implies that the employee will be put in the same position in which

he would have been but for the illegal action taken by the

employer. The injury suffered by a person, who is dismissed or

removed or is otherwise terminated from service cannot easily be

measured in terms of money. With the passing of an order which

has the effect of severing the employer-employee relationship, the

latter’s source of income gets dried up. Not only the employee

concerned, but his entire family suffers grave adversities. They are

deprived of the source of sustenance. The children are deprived of

23

nutritious food and all opportunities of education and advancement

in life. At times, the family has to borrow from the relatives and

other acquaintance to avoid starvation. These sufferings continue

till the competent adjudicatory forum decides on the legality of the

action taken by the employer. The reinstatement of such an

employee, which is preceded by a finding of the competent

judicial/quasi-judicial body or court that the action taken by the

employer is ultra vires the relevant statutory provisions o r the

principles of natural justice, entitles the employee to claim full back

wages. If the employer wants to deny back wages to the employee

or contest his entitlement to get consequential benefits, then it is

for him/her to specifically plead and prove that during the

intervening period the employee was gainfully employed and was

getting the same emoluments. The denial of back wages to an

employee, who has suffered due to an illegal act of the employer

would amount to indirectly punishing the employee con cerned and

rewarding the employer by relieving him of the obligation to pay

back wages including the emoluments.”

x x x

38. The propositions which can be culled out from the

aforementioned judgments are:

38.1. In cases of wrongful termination of service, reinstatement

with continuity of service and back wages is the normal rule.

38.2. The aforesaid rule is subject to the rider that while deciding

the issue of back wages, the adjudicating authority or the court

may take into consideration the length of service of the

employee/workman, the nature of misconduct, if any, found proved

against the employee/workman, the financial condition of the

employer and similar other factors.

38.3. Ordinarily, an employee or workman whose services are

terminated and who is desirous of getting back wages is required to

either plead or at least make a statement before the adjudicating

authority or the court of first instance that he/she was not gainfully

employed or was employed on lesser wages. If the employer wants

to avoid payment of full back wages, then it has to plead and also

lead cogent evidence to prove that the employee/workman was

gainfully employed and was getting wages equal to the wa ges

he/she was drawing prior to the termination of service. This is so

because it is settled law that the burden of proof of the existence of

a particular fact lies on the person who makes a positive averment

about its existence. It is always easier to prove a positive fact than

to prove a negative fact. Therefore, once the employee shows that

he was not employed, the onus lies on the employer to specifically

plead and prove that the employee was gainfully employed and was

getting the same or substantially similar emoluments.

38.4. The cases in which the Labour Court/Industrial Tribunal

exercises power under Section 11-A of the Industrial Disputes Act,

1947 and finds that even though the enquiry held against the

employee/workman is consistent with the rules of natural justice

and/or certified standing orders, if any, but holds that the

24

punishment was disproportionate to the misconduct found proved,

then it will have the discretion not to award full back wages.

However, if the Labour Court/Industrial Tribunal finds that the

employee or workman is not at all guilty of any misconduct or that

the employer had foisted a false charge, then there will be ample

justification for award of full back wages.

38.5. The cases in which the competent court or tribunal finds that

the employer has acted in gross violation of the statutory provisions

and/or the principles of natural justice or is guilty of victimising the

employee or workman, then the court or tribunal concerned will be

fully justified in directing payment of full back wages. In such

cases, the superior courts should not exercise power under Article

226 or 136 of the Constitution and interfere with the award passed

by the Labour Court, etc. merely because there is a possibility of

forming a different opinion on the entitlement of the

employee/workman to get full back wages or the employer’s

obligation to pay the same. The courts must always keep in view

that in the cases of wrongful/illegal termination of service, the

wrongdoer is the employer and the sufferer is the

employee/workman and there is no justification to give a premium

to the employer of his wrongdoings by relieving him of the burden

to pay to the employee/workman his dues in the form of ful l back

wages.

38.6. In a number of cases, the superior courts have interfered

with the award of the primary adjudicatory authority on the

premise that finalisation of litigation has taken long time ignoring

that in majority of cases the parties are not responsible for such

delays. Lack of infrastructure and manpower is the principal cause

for delay in the disposal of cases. For this the litigants cannot be

blamed or penalised. It would amount to grave injustice to an

employee or workman if he is denied back wages simply because

there is long lapse of time between the termination of his service

and finality given to the order of reinstatement. The courts should

bear in mind that in most of these cases, the employer is in an

advantageous position vis-à-vis the employee or workman. He can

avail the services of best legal brain for prolonging the agony of the

sufferer i.e. the employee or workman, who can ill-afford the luxury

of spending money on a lawyer with certain amount of fame.

Therefore, in such cases it would be prudent to adopt the course

suggested in Hindustan Tin Works (P) Ltd. v. Employees [(1979) 2

SCC 80].

38.7. The observation made in J.K. Synthetics Ltd. v. K.P. Agrawal

[(2007) 2 SCC 433] that on reinstatement the employee/workman

cannot claim continuity of service as of right is contrary to the ratio

of the judgments of three-Judge Benches referred to hereinabove

[Hindustan Tin Works (P) Ltd. (supra) and Surendra Kumar Verma

(supra)] and cannot be treated as good law. This part of the

judgment is also against the very concept of reinstatement of an

employee/workman.”

(emphasis supplied)

25

43. We cannot but endorse our wholehearted concurrence with the

views expressed in the aforesaid decisions. Taking a cue therefrom,

it can safely be concluded that ordering back wages to be paid to a

dismissed employee - upon his dismissal being set aside by a court

of law – is not an automatic relief; grant of full or partial back

wages has to be preceded by a minor fact-finding exercise by the

industrial adjudicator/court seized of the proceedings. Such exercise

would require the relevant industrial court or the jurisdictional high

court or even this Court to ascertain whether in the interregnum,

that is, between the dates of termination and proposed

reinstatement, the employee has been gainfully employed. If the

employee admits of any gainful employment and gives particulars of

the employment together with details of the emoluments received,

or, if the employee asserts by pleading that he was not gainfully

employed but the employer pleads and proves otherwise to the

satisfaction of the court, the quantum of back wages that ought to

be awarded on reinstatement is really in the realm of discretion of

the court. Such discretion would generally necessitate bearing in

mind two circumstances : the first is, the employee, because of the

order terminating his service, could not work for a certain period

under the employer and secondly, for his bare survival, he might

not have had any option but to take up alternative employment. It

is discernible from certain precedents, duly noticed in Deepali

Gundu Surwase (supra), that the courts are loath to award back

26

wages for the period when no work has been performed by such an

employee. Such a view is no doubt debatable, having regard to the

ratio decidendi in Hindustan Tin Works (P) Ltd. (supra),

Surendra Kumar Verma (supra) and Deepali Gundu Surwase

(supra). Though the latter decision was cited before the coordinate

bench when it decided Phool Chand (supra), any thoughtful

discussion appears to be absent.

44. There is one other aspect that would fall for consideration of the

court. In certain decisions, noticed in Deepali Gundu Surwase

(supra), it has been opined that whether or not an employee has

been gainfully employed is within his special knowledge and having

regard to Section 106 of the Evidence Act, 1872, the burden of

proof is on him. What is required of an employee in such a case? He

has to plead in his statement of claim or any subsequent pleading

before the industrial tribunal/labour court that he has not been

gainfully employed and that the award of reinstatement may also

grant him back wages. If the employee pleads that he was not

gainfully employed, he cannot possibly prove such negative fact by

adducing positive evidence. In the absence of any contra-material

on record, his version has to be accepted. Reference in this

connection may be made to Section 17 -B of the Industrial Disputes

Act, 1947, which confers a right on an employee to seek “full wages

last drawn” from the employer while the challenge of the employer

to an award directing reinstatement in a higher court remains

27

pending. There too, what is required is a statement on affidavit

regarding non-employment and with such statement on record, the

ball is in the court of the employer to satisfy the court why relief

under such section ought not to be granted by invoking the proviso

to the section. We see no reason why a similar approach may not

be adopted. After the employee pleads his non-employment and if

the employer asserts that the employee was gainfully employed

between the dates of termination and proposed reinstateme nt, the

onus of proof would shift to the employer to prove such assertion

having regard to the cardinal principle that ‘he who asserts must

prove’. Law, though, seems to be well settled that if the employer

by reason of its illegal act deprives any of its employees from

discharging his work and the termination is ultimately held to be

bad in law, such employee has a legitimate and valid claim to be

restored with all that he would have received but for being illegally

kept away from work. This is based on the principle that although

the employee was willing to perform work, it was the employer who

did not accept work from him and, therefore, if the employer’s

action is held to be illegal and bad, such employer cannot escape

from suffering the consequences. However, it is elementary but

requires to be restated that while grant of full back wages is the

normal rule, an exceptional case with sufficient proof has to be set

up by the employer to escape the burden of bearing back wages.

28

45. We hasten to add that the courts may be confronted with cases

where grant of lumpsum compensation , instead of reinstatement

with back wages, could be the more appropriate remedy. The courts

may, in such cases, providing justification for its approach direct

such lumpsum compensation to be paid keeping in mind the interest

of the employee as well as the employer.

46. Mahadeo has admitted in his counter affidavit filed before this

Court of being engaged in badli work on a daily wage basis. At the

same time, it is his specific case that because his service was

terminated by the Corporation, he could not find a permanent

employment elsewhere. There is no material on record to disbelieve

Mahadeo. Since the exact quantum of wages earned by Mahadeo is

not available and at the same time it is clear as crystal that the

Corporation succeeded in its attempt to get rid of Mahadeo by

indulging in the misadventure of suppressio veri and suggestio falsi,

we are of the considered opinion that interest of justice would be

sufficiently served if, in modification of the order of the single judge

awarding 100% back wages, Mahadeo is awarded 75% of the back

wages from the date of his termination till the date of his

superannuation.

47. The third issue having thus been answered, we are left with the

fourth and final issue.

48. It is ordered that Mahadeo is entitled to 75% of the back wages

from the date of his termination till the date of his superannuation.

29

This would be apart from Mahadeo being entitled to full terminal

benefits, along with interest @ 6% per annum, had he never been

dismissed from service. It is ordered accordingly.

49. The amounts Mahadeo is entitled to in terms of this order shall be

released in his favour by the Corporation within three months from

date of its communication; in default, the said amount shall carry

further interest @ 2% from such default till full payment.

CONCLUSION

50. With the aforesaid modification of the impugned order, this civil

appeal stands disposed of.

51. Parties shall bear their own costs.

…………………………J .

(DIPANKAR DATTA )

……………………… ….J.

(SANDEEP MEHTA )

New Delhi;

14

th

February, 2025.