Kiran Raj

The Supreme Court of India has modified a Bombay High Court order granting full back wages to a dismissed Maharashtra State Road Transport Corporation (MSRTC) employee, awarding instead 75% of back wages from the date of termination until superannuation. The court found that MSRTC had engaged in "suggestio falsi" and "suppresio veri" by failing to disclose material evidence before the Labour Court, which led to the wrongful dismissal of the employee.

The case originates from the dismissal of Mahadeo Krishna Naik, a bus driver with MSRTC, who was removed from service following a fatal road accident on May 10, 1996. The accident involved a lorry colliding with a bus driven by Mahadeo, resulting in the deaths of two passengers and injuries to several others. A subsequent departmental inquiry concluded that Mahadeo had been negligent, leading to his dismissal on May 27, 1997. His appeals before the Corporation and the Labour Court were unsuccessful, with the Labour Court upholding the inquiry findings and refusing relief to him.

Mahadeo later approached the Bombay High Court under Article 226 of the Constitution, but his writ petition was dismissed in 2017. However, upon discovering new evidence from proceedings before the Motor Accident Claims Tribunal (MACT), Mahadeo filed for a review of the High Court's decision. The single judge of the Bombay High Court, in 2018, found that MSRTC had taken a contradictory stand before the MACT and suppressed relevant evidence before the Labour Court. Consequently, the High Court set aside Mahadeo’s dismissal, ordered the payment of full back wages, and denied reinstatement as Mahadeo had reached the age of superannuation.

The Supreme Court noted that before the MACT, MSRTC had asserted that the accident was solely caused by the negligence of the lorry driver. The Corporation presented evidence before the MACT, including testimonies from the bus conductor and a passenger, which absolved Mahadeo of any responsibility. The MACT's decision did not impose any liability on MSRTC, further reinforcing that Mahadeo was not at fault.

The Supreme Court stated: "The Corporation did not leave any stone unturned before the Labour Court to establish that the inquiry against Mahadeo was fair and that he was guilty of misconduct. However, the contradictory stance taken before the MACT and the suppression of material evidence before the Labour Court indicate a clear case of ‘suggestio falsi’ and ‘suppresio veri’."

The Court stated that suppression of evidence in judicial proceedings amounts to a fraud on the court. Citing precedents, it observed: "Every party is under a legal obligation to make truthful statements before the court, as causing an obstruction in the due course of justice undermines its very flow."

The bench, comprising Justice Dipankar Datta and Justice Sandeep Mehta, relied on Associate Builders v. Delhi Development Authority (2015) and State of M.P. v. Narmada Bachao Andolan (2011) to state that withholding material evidence affects the fairness of judicial decisions. The Court concluded that the High Court was justified in exercising its review jurisdiction to rectify the injustice done to Mahadeo.

The Supreme Court partially modified the High Court's order concerning back wages. While the High Court had awarded full back wages, the Supreme Court reduced it to 75%, reasoning that Mahadeo had engaged in casual work during his dismissal period. The Court directed: "Mahadeo is entitled to 75% of the back wages from the date of his termination until the date of his superannuation, apart from full terminal benefits, along with interest at 6% per annum, had he never been dismissed from service."

The Supreme Court ordered MSRTC to release the amounts within three months, failing which an additional 2% interest would be imposed on the pending amount. With this modification, the civil appeal was disposed of.

Case Title: Maharashtra State Road Transport Corporation v. Mahadeo Krishna Naik
Case Number: Civil Appeal No. 13834 of 2024
Bench: Justice Dipankar Datta, Justice Sandeep Mehta

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