A) ABSTRACT / HEADNOTE

This analysis examines Maharashtra State Road Transport Corporation v. Mahadeo Krishna Naik (Civil Appeal No. 13834 of 2024), where the Supreme Court considered whether the Corporation committed suggestio falsi and suppresio veri by failing to disclose its contrary pleadings and the award in proceedings before the Motor Accidents Claims Tribunal (MACT), and whether the High Court was justified in exercising review jurisdiction and awarding back wages. The MACT had held the lorry driver solely responsible and dismissed the claim against the Corporation; however, in industrial adjudication and writ proceedings the Corporation maintained that the departmental inquiry and punishment of the bus driver (Mahadeo) were valid.

The High Court (Single Judge) allowed a review based on the MACT material and directed consequential relief including back wages; the Supreme Court affirmed that the Corporation’s non-disclosure amounted to suggestio falsi and suppresio veri, justified review under Order XLVII CPC and Section 114 Evidence Act principles, and modified the back-wages award to 75% (with full terminal benefits and interest). The Court reiterated that while full back wages are the normal rule when termination is set aside, the quantum is a discretionary, fact-sensitive exercise requiring a mini inquiry into gainful employment during the interregnum.

This case underscores courts’ intolerance of deliberate suppression or contradictory pleadings, the probative utility of MACT findings in related proceedings, and the settled principles governing reinstatement and back wages.

Keywords: suggestio falsi; suppresio veri; back wages; MACT award; reinstatement; industrial adjudication; natural justice; Order XLVII CPC; Motor Vehicles Act, 1988; Industrial Disputes Act, 1947.

B) CASE DETAILS 

C) INTRODUCTION AND BACKGROUND OF JUDGEMENT

The dispute arises from a 1996 fatal road accident in which a lorry collided with an MSRTC bus driven by Mahadeo, killing passengers and injuring others. The Corporation dismissed Mahadeo after departmental inquiry (1997), the dismissal was upheld by the Labour Court, and a writ petition challenging that outcome was dismissed by the High Court. Parallel MACT proceedings were instituted by victims’ families; in those proceedings the Corporation by sworn written statement placed the blame squarely on the lorry driver and led evidence (conductor and passenger) supporting that stance; the MACT awarded compensation against the lorry owner and insurer and dismissed the case against the Corporation.

Only later, when certified MACT materials came into the possession of Mahadeo, did he seek review of the High Court order. The Single Judge allowed review relying on the MACT pleadings and award as material that, had it been before the Labour Court/High Court, could have produced a different result. The Corporation challenged this, arguing the MACT’s finding was not binding in industrial adjudication and that review substituted the court’s view for that of the tribunal.

The Supreme Court was called upon to decide whether the Corporation’s failure to disclose its MACT stance constituted suggestio falsi/suppresio veri, whether review was permissible, and what the appropriate remedy (including back wages) should be. The Court analyzed probative value of MACT material, principles of approbate and reprobate, and established precedents on reinstatement and back wages, culminating in modification of the Single Judge’s award but upholding review and remedies in substance.

D) FACTS OF THE CASE

Mahadeo joined MSRTC as driver on 19 April 1988. On 10 May 1996 at about 22:45, a lorry (Reg. MRL-8226) allegedly came onto the wrong side and struck the bus driven by Mahadeo, causing two deaths and multiple injuries; the Corporation’s property loss was assessed at Rs.45,000. Criminal FIR named the lorry driver as accused; Mahadeo was not charged. Disciplinary inquiry led to dismissal on 27 May 1997; departmental appeal failed. The Union referred an industrial dispute; the 4th Labour Court (preliminary and final awards) held the inquiry fair, findings not perverse, and punishment proportionate denying Mahadeo relief.

Writ petition (W.P. No.154/2007) to the High Court was dismissed. Meanwhile, claimants filed MACT Application No. 2901/1996; the Corporation filed a sworn written statement in MACT admitting that the lorry driver was at fault and led DWs (conductor and a passenger) supporting the lorry’s sole negligence; MACT awarded Rs.1,40,000 to claimants and expressly dismissed the case against the Corporation. Mahadeo later obtained certified MACT papers (June 2017) and applied for review (R.P. No.18/2018) of the High Court dismissal; the Single Judge, treating the MACT materials as newly discovered and clinching, allowed review, set aside Labour Court award, denied reinstatement (superannuation attained) but directed full back wages & terminal benefits. The Corporation appealed.

E) LEGAL ISSUES RAISED

1. Whether the Corporation’s contrary pleadings and non-disclosure of the MACT award before the Labour Court/High Court amount to suggestio falsi and suppresio veri?

2. Whether the High Court was justified in exercising review jurisdiction under Order XLVII CPC / Sec.114 Evidence Act based on the MACT materials?

3. Whether Mahadeo is entitled to back wages, and if so, whether full back wages or a modified percentage should be awarded given his admitted daily-wage engagement and absence of comprehensive proof of non-employment?

F) PETITIONER / APPELLANT’S ARGUMENTS

The counsels for Petitioner / Appellant submitted that the disciplinary inquiry established rashness/negligence by Mahadeo; the MACT finding was not binding on the Labour Court because forums differ in purpose and standards; review is limited to procedural infirmity and not correctness of findings; remand to the Labour Court was the appropriate course rather than substitution; and the Single Judge erred in awarding full back wages without evidence that Mahadeo was not gainfully employed during the interregnum, relying on Phool Chand to assert discretion against automatic full back wages.

G) RESPONDENT’S ARGUMENTS

The counsels for Respondent submitted that the Corporation committed fraud on court by concealing its MACT pleadings and award, thereby obtaining favourable orders; the MACT material was decisive and newly available to the respondent; principles of approbate and reprobate and the prohibition on suppression warranted review and relief; reinstatement could be impracticable (superannuation) but consequential relief including back wages and terminal benefits was merited; precedents like Deepali Gundu Surwase supported full back wages where employer acted unfairly or victimised the employee.

H) JUDGEMENT 

The Court answered the first issue affirmatively: the Corporation’s written MACT pleadings admitting the bus driver was not at fault and attributing sole negligence to the lorry driver were inconsistent with the stance before the Labour Court and were deliberately not disclosed. Such conduct amounted to suggestio falsi (false representation) and suppresio veri (suppression of truth), doctrines the Court described via Black’s Law Dictionary and applied as equitable/ethical restraints against approbation-reprobation. The Court emphasized courts’ intolerance for suppression amounting to fraud on the court and relied on State of M.P. v. Narmada Bachao Andolan to show that false pleadings obstruct justice.

On the second issue the Court held review permissible: Order XLVII CPC and Section 114 permit reconsideration where material, despite due diligence, was not previously produced and is of such import that it could have changed the outcome. The MACT written statement and award were “documents of immense significance” capable of tilting the balance; the Single Judge therefore rightly received them in review and remand would have been futile given the material’s conclusiveness. The Court rejected the Corporation’s objection to reception of MACT material in review.

On back wages the Court revisited precedent: three-Judge Bench authorities (Hindustan Tin Works, Surendra Kumar Verma) establish that reinstatement with continuity and back wages is the normal rule, while later jurisprudence allows discretion in exceptional circumstances. The Court affirmed that awarding back wages is not automatic; a “mini fact-finding” on gainful employment during the interregnum is necessary.

Given Mahadeo’s admission of daily-wage badli work and lack of evidence to disprove his inability to obtain permanent employment, and coupled with the Corporation’s culpable conduct, the Court modified the Single Judge’s award of 100% back wages to 75% (from termination to superannuation), while granting full terminal benefits with 6% interest. The reduction balanced avoidance of unjust enrichment and recognition of respondent’s partial earning capacity. Directions to pay within three months with default interest were ordered.

a. RATIO DECIDENDI

The controlling ratio is twofold:

first, deliberate contradiction between a party’s sworn pleadings in one forum and assertions in another, together with non-disclosure of an adverse or exculpatory award, may constitute suggestio falsi/suppresio veri, amounting to a fraud on court and justifying review/remedial interference.

Second, while reinstatement with full back wages remains the default remedy when termination is held invalid, the quantum of back wages requires a limited fact-sensitive inquiry into gainful employment during the period; where the employee gives credible but imperfect evidence of intermittent/daily wage work and employer is blameworthy, a proportionate award (here 75%) is an appropriate equitable remedy.

b. OBITER DICTA 

The Court observed obiter that industrial adjudication is governed by fairness and natural justice though strict Evidence Act rules may not fully apply; also courts must be vigilant against parties who attempt to “have it both ways” by approbating & reprobating. The Court reiterated the utility of Order XLVII and the equitable considerations in moulding relief such as lumpsum compensation when reinstatement is impracticable. It cautioned employers that suppressing material relevant to disciplinary proceedings invites serious remedial consequences.

c. GUIDELINES 

1. A party must not adopt mutually inconsistent positions in different fora where the inconsistency prejudices adversaries; nondisclosure of prior pleadings/awards is culpable.

2. Review under Order XLVII CPC/Sec.114 is permissible when material, despite due diligence, was not on record and could change the outcome.

3. MACT findings, though not per se binding in labour proceedings, have probative value and must be disclosed if relied upon previously.

4. Reinstatement with back wages is normal; the adjudicator must still inquire whether the employee was gainfully employed in the interregnum; burden shifts to employer if it alleges gainful employment.

5. Where reinstatement is impossible (superannuation), courts should award monetary relief proportionate to proven loss and employer culpability.

I) CONCLUSION & COMMENTS

The Supreme Court upheld the Single Judge’s exercise of review and remedial direction but moderated the quantum of back wages from full to 75% given the factual nuance of daily-wage engagements by Mahadeo and the absence of precise proof of complete non-employment. The decision sternly condemns corporate conduct amounting to suggestio falsi/suppresio veri, stressing duty of candour in litigation and equity in labour remedies.

Practically, the judgment:

(i) reaffirms the high probative value of prior tribunal pleadings and awards where they bear on disciplinary innocence/guilt,

(ii) endorses a proportionate, fact-based approach to back wages rather than a rigid automatic rule, and

(iii) sends a remedial message that courts will not tolerate tactical suppression especially by a dominant employer that deprives employees of livelihood.

The ratio will guide litigants across service, labour and tort forums on disclosure obligations and courts on balancing restitution with mitigation evidence.

J) REFERENCES

a. Important Cases Referred

1. Associate Builders v. Delhi Development Authority, 2015 (3) SCC 49.
2. Hindustan Tin Works (P) Ltd. v. Employees, (1979) 2 SCC 80.
3. Surendra Kumar Verma v. Central Govt. Industrial Tribunal-cum-Labour Court, (1980) 4 SCC 443.
4. Deepali Gundu Surwase v. Kranti Junior Adhyapak Mahavidyala, (2013) 10 SCC 324.
5. Rajasthan State Road Transport Corporation v. Phool Chand, (2018) 18 SCC 229.
6. State of M.P. v. Narmada Bachao Andolan, (2011) 7 SCC 639.
7. Union of India v. N. Murugesan, (2022) 2 SCC 25.

b. Important Statutes Referred

1. Motor Vehicles Act, 1988 (esp. Section 166).
2. Industrial Disputes Act, 1947.
3. Evidence Act, 1872 (esp. Section 106).
4. Code of Civil Procedure, 1908 (Order XLVII, Sections on review; Section 114 for inherent power principles cited).