[1] IN IN IN THE HIGH COURT OF JUDICATURE AT BOMBAY CIVIL APPELLATE JURISDICTION WRIT PETITION NO.4625 OF 2008 1. The Principal Daund Taluka Arts and Commerce College, Daund, Taluka Daund, District Pune. 2. The President, Naigaon Education Society of Bombay, 200-201, S.S. Wagh Marg (East), Naigaon, Dadar, Mumbai-400 014. 3. The Secretary, Naigaon Education Society Bombay, 200-201, S.S. Wagh Marg (East), Naigaon, Dadar, Mumbai-400 014. .... Petitioners - Versus - 1. Shri Macchindra Sahebrao Bhavar, Adult, Occ: Service, residing at Tara, E-7, Gajanan Row Housing Society, Daund, Taluka Daund, District Pune. 2. The Government of Maharashtra through the Administrative Officer, Grand-in-Aid, High Education, Pune Division, Pune - 411 001. .... Respondents Shri N.V. Bandiwadekar for the Petitioners. Shri P.K. Hushing for Respondent No.1. Mrs. S.S. Bhende, Asstt. Government Pleader, for Respondent No.2. CORAM: CORAM: CORAM: DR. D.Y. CHANDRACHUD, J. DATED: DATED: DATED: DECEMBER 18, 2008 ORAL JUDGMENT: ORAL JUDGMENT: ORAL JUDGMENT: [2] 1. Rule, by consent of the learned counsel made returnable forthwith. Counsel appearing for the respondents waive service. With the consent of the learned counsel and at their request, the matter is taken up for hearing and final disposal. 2. By an order dated 9-8-2007 a learned single Judge of this Court disposed of a petition under Article 226 of the Constitution challenging an order of the College Tribunal granting reinstatement with continuity of service and full back wages to the first respondent to this proceeding. The learned single Judge allowed the petition filed by the Management in part. The order of reinstatement with continuity of service was confirmed and the first respondent was held to be entitled to reinstatement in the post of Peon with effect from 1-4-1990. The Deputy Director of Higher Education, Pune was directed to grant approval to the appointment of the first respondent from that date. Insofar as the question of back wages was concerned, the case of the Management was that the first respondent was gainfully employed, while the first respondent contended to the contrary. The learned single Judge remanded the proceedings back to the Tribunal to decide the issue of back wages and permitted both the parties to lead evidence in that behalf. Upon remand, the College Tribunal allowed the claim for back wages to the extent [3] of 50%. The amount was quantified at Rs.2,77,984.50. 3. Counsel appearing on behalf of the petitioners submitted that the order passed by the Tribunal suffers from a manifest perversity and is contrary to the law laid down by the Supreme Court in Kendriya Vidyalaya Kendriya Vidyalaya Kendriya Vidyalaya Sangathan and another v. S.C. Sharma, Sangathan and another v. S.C. Sharma, Sangathan and another v. S.C. Sharma, reported in (2005) 2 SCC 363. Counsel submitted that in the present case, the first respondent had filed two affidavits from which it is evident that the disclosures that were made before the Tribunal in the first instance were false and that there was a wilful suppression of material facts bearing on the income earned by the first respondent during the period when he was not in service. It is urged that the burden being on the first respondent to establish that he was not gainfully employed, he was disentitled to the grant of back wages once it is established that he had prevaricated in his disclosures before the Tribunal. On the other hand, the learned counsel appearing on behalf of the first respondent submitted that the Tribunal had in the judicious exercise of its discretion allowed the claim for back wages to the extent of 50% and that this should not be interfered with in the supervisory jurisdiction of this Court under Articles 226 and 227 of the Constitution. 4. In view of the Judgment of the Supreme Court in [4] Kendriya Vidyalaya Sangathan’s Kendriya Vidyalaya Sangathan’s Kendriya Vidyalaya Sangathan’s case (supra), it is now a settled principle of law that when the question of determining the entitlement of an employee to back wages arises for determination, the employee has to show that he was not gainfully employed during the period of the termination. The initial burden under the law is on the employee. The Supreme Court has held that after and if the employee places materials in that regard, the employer can bring on record materials to rebut the claim (at paragraph 16 on page 366). The attention of the Tribunal was drawn to the Judgment of the Supreme Court in Kendriya Vidyalaya Sangathan’s Kendriya Vidyalaya Sangathan’s Kendriya Vidyalaya Sangathan’s case. All that the Tribunal observed was that the learned Judge had "carefully gone through this decision" but "that the same is not at all applicable to the facts of the present case". The learned Judge observed that the decision lays down that payment of back wages involves a discretionary element to be assessed in the facts of each case and no "straight-jacket" formula can be evolved. The manner in which the Judgment of the Supreme Court has been dealt with in the order of the Tribunal, leaves much to be desired. The law declared by the Supreme Court is binding on all Courts and Tribunals in the country under Article 141 of the Constitution. The Presiding Officer of the College Tribunal was duty bound to follow the Judgment of the Supreme Court. The Judgment of the Supreme Court must [5] be followed for the law which it lays down and cannot be cavalierly distinguished on facts in the manner in which it has been sought to be distinguished in the Judgment of the Tribunal. Not following the law declared by the Supreme Court would amount to a dereliction of judicial duties. The Judgment of the Supreme Court could not have been merely distinguished by holding that a discretionary element is involved in the payment of back wages. After referring to the element of discretion in paragraph 14 of the Judgment, the Supreme Court has observed thus; in paragraph 16: "When the question of determining the entitlement of a person to back wages is concerned, the employee has to show that he was not gainfully employed. The initial burden is on him. After and if he places materials in that regard, the employer can bring on record materials to rebut the claim. In the instant case, the respondent had neither pleaded not placed any material in that regard." Evidently the Tribunal has disregarded the observations in paragraph 16. 5. That apart, there is merit in the submission [6] which has been urged on behalf of the petitioners that the first respondent was, from the nature of his disclosures as well as from his failure to disclose all material facts that were within his knowledge, disentitled to the grant of the relief of back wages. In the Written Statement that was filed by the petitioners, there were detailed averments of why the first respondent was disentitled to the award of back wages. Paragraphs 8 and 9 of the Written Statement would need to be extracted in their entirety and they read as follows: "8. These Respondents state that the Respondent No.1 Principal of the said College has filed Affidavit regarding gainful employment of the Appellant in the above Writ Petition No.4532 of 1993 dated 5.2.2007 stating therein that the Appellant stopped reporting for work at the Respondent No.1 College and he had started running an agency of Sanchayani Saving and Investment (I) Ltd. and was earning commission on regular basis. In and around 1995, the Appellant started running Stationery and General Stores in the name of "Tara Vividhalaya" an ownership premises situate at Gajanan [7] Housing Society, Baramati Shrigonda Road, Opp. M.S.E.B. Sub-Station, Daund, District Pune. The Appellant had also started "circulating Library" in the said premises. The Appellant has been working as ‘Manager’ till date in "the Swatantraveer Savarkar Nagari Sahakari Co-operative Credit Society Ltd.", situated at Ambedkar Chowk, Daund. The Appellant was also working on contract basis for writing accounts with one Shivkripa Urban Co-operative Credit Society Ltd., situated at Sutarnet, Near State Bank of India, Daund. The Appellant was also doing seasonal business like sale of crackers and calendars etc. In and around 2005, the Appellant had purchased another commercial premises admeasuring 200 sq.ft. approx. in a prime commercial area at Gopalwadi Road, Opp. Dr. Mane’s Hospital, Taluka Daund, District Pune and he has been running General Stores under the name of "Tara Vividhalaya" there. The Appellant is running two General Stores at Gajanan Housing Society and at Gopalwadi Road as [8] stated hereinabove. These Respondents state that the Appellant had also purchased Hero Honda Splender Motorcycle. The Appellant had taken loan of Rs.5,000/- from the Co-operative Credit Society of the Respondent No.1 College employees for business purpose on 3.11.1995 and he had repaid the same in instalment by 18.12.1998. The Appellant had taken loan of Rs.10,000/- on 4.1.1999 and the same was also repaid on 22.5.2000. The 3rd loan was taken of Rs.20,000/- on 22.5.2000 and the same was repaid by 5.12.2002. 4th Loan was taken for Rs.25,000/- on 20.5.2002, and the same was also repaid by 6.8.2004. All these loans were taken by the Appellant from the employees Credit Society of the Respondent No.1 College for business purposes. Therefore, after having repaid the same, this clearly show that the Appellant was gainfully employed and/or doing business throughout intervening period and after looking to the aforesaid business activities of the Appellant, the Appellant appears to be not in need of a [9] job. Hereto annexed and marked as EXHIBIT 5 is the copy of the Affidavit dated 5.2.2007 of the present Respondent No.1 College, showing gainful employment of the Appellant, filed in Writ Petition No.4532 of 1993. 9. These Respondents state that the Government Audit Report for the year 2005-2006 of the Swatantraveer Savarkar Nagari Co-operative Credit Society Ltd., at Post Daund, Taluka Daund, District Pune, clearly reflects that the Appellant, Shri Macchindra Sahebrao Bhavar was working as the "Manager" in the said Co-operative Credit Society at the relevant time. The financial status of the said Credit Society appears to be good as the said Society had received Grade ‘B’ for the year 2005-2006 from the Government Auditor and in paragraph No.8 of the said report and in the list enclosed to the same report, the name of the Appellant is shown as the Manager of the said Society. Hereto annexed and marked as EXHIBIT 6 is the Certified copy of the said Government Audit Report [10] of the said Swatantraveer Savarkar Co-operative Credit Society Ltd. in which the Appellant was working as the Manager in the said Co-operative Credit Society." Two affidavits were filed on behalf of the first respondent. In the first affidavit dated 13-2-2007 the first respondent averred that the shop to which a reference has been made in the Written Statement was commenced by his brothers in 2002 and was being looked after by the wives of his two brothers and by the other members of the family. The first respondent stated that he had not taken any part in the affairs of the shop. The allegation that it was the first respondent who owned the premises wherein the shop was situated was not denied. In the subsequent affidavit dated 2-11-2007 the first respondent stated that the shop by the name of Tara Vividhalay was not owned by him nor did he run the same but that it was in the name of his wife who conducted the shop. The clear divergence between the statements in the two affidavits by the first respondent is also apparent in regard to the other aspects therein. Insofar as the services of the first respondent in the Swatantryaveer Savarkar Nagari Sahakari Co-op. Credit Society is concerned, the first respondent stated that he was working for only one hour a day for sometime [11] therein for writing accounts and that thereafter the Society had continued to take his help only once a week. In the subsequent affidavit, however, the first respondent disclosed that he had been engaged as an account writer and manager from June, 1998 till March, 2007 and that he had earned around Rs.1,34,800/-. As already noted earlier, one of the defences in the Written Statement was that the first respondent had taken a large number of loans from Banks which he had repaid and which indicated that he was in possession of adequate funds to sustain his livelihood. In the first affidavit the first respondent stated that after his termination he had no option but to take those loans and that the loans had been repaid with the help of the income of his wife and with the help of his brothers; the loans having been sanctioned without any security and only on the basis of guarantees. In the second affidavit the first respondent stated that the loans were repaid by him with the help of his friends and his own income from the work he had done for two named institutions. It is thus apparent ex facie from a bare reading of the two affidavits that the first respondent set up a case in the first affidavit which was false and that even when he made disclosures in the second affidavit, the disclosure was neither full nor complete. 6. The burden of establishing in the first instance [12] that the employee was not gainfully employed is on him. This burden has to be discharged by making a full, complete and candid disclosure. A suppression of facts negates the concept of a proper disclosure. Equally, a disclosure in part which withholds material facts from the Court would amount to a complete abuse of the process. In such a case the Court must take a strict view of the conduct of the employee by dismissing the claim for back wages. The position that the grant of back wages must follow an order of reinstatement is not reflective of the law today. A claim for back wages has to be proved. The employee has to discharge the burden by producing adequate material before the Court. Where the employee fails to do so, the claim for back wages shall have to be dismissed. That is the law - and the law which all Courts and Tribunals are duty bound to follow. 7. The petitioners had filed two applications, the first for the issuance of a witness summons to the Municipal Council where the shop was located for the production of the original records relating to assessment, shop licence, etc.. The second application sought a direction to the first respondent to produce the relevant registers, ledgers and vouchers in respect of the shop. The Tribunal was completely in error in dismissing the application for the issuance of a witness [13] summons and for the production of the relevant registers. An adverse inference would have to be drawn against the first respondent on account of his failure to produce material evidence which was within his knowledge and control which would have a bearing on the question as to whether he was gainfully employed. 8. For all these reasons, the claim of the first respondent to the payment of back wages was completely unsustainable. The order of the Tribunal in awarding back wages suffers from manifest legal perversity and would warrant interference in these proceedings. Before concluding, however, it would be necessary to record the statement of the learned counsel appearing on behalf of the petitioners that towards compliance with the order of reinstatement, that was confirmed in the earlier judgment of the learned single Judge of this Court dated 9-8-2007 (which has not been challenged by the Management), the first respondent would be entitled to reinstatement with effect from 1-4-1990 and that necessary corrections in the record would be made accordingly. The first respondent, the Court is informed, has already joined service on 10-10-2007. The impugned order passed by the Tribunal dated 28-1-2008 is set aside and the claim for back wages shall accordingly stand rejected. Rule is made absolute in the aforesaid terms. There shall be no order as to costs. [14] 9. Despite the order of this Court dated 9-8-2007 directing the grant of approval to the appointment of the first respondent from 1-4-1990, the Court has been informed that no steps have been taken by the Education Department. A letter was addressed by the petitioners to the Joint Director of Higher Education (Grants), Pune-411 001 on 5-10-2007 followed by reminders dated 4-2-2008, 21-2-2008 and 19-3-2008. Prima facie, the authorities in failing to abide by the direction of this Court in the order dated 9-8-2007 are liable to be proceeded with. The office is directed to issue a notice to the Joint Director of Higher Education (Grants), Pune-411 001 calling upon him to show cause as to why action should not be adopted against him for non-compliance of the direction contained in the order dated 9-8-2007. The notice shall be made returnable on 15-1-2009. (Dr. D.Y. Chandrachud, J.) sjs/D8wpj4625.8 sjs/D8wpj4625.8 sjs/D8wpj4625.8