Supreme Court grants back wages after delayed regularisation and holds employer cannot rely on forced acceptance of later appointment date.
Case Name: Balaji Madhukar Konkanwar v. Maharashtra State Road Transport Corporation
Citation: 2026 INSC 392
Date of Judgment/Order: 20 April 2026
Bench: Justice Sanjay Karol and Justice Nongmeikapam Kotiswar Singh
Held: The Supreme Court held that an employer cannot avoid liability for back wages by relying on the employee’s acceptance of regular employment from a later date, when the employee had already been held entitled to regularisation from the date of completing 180 days of service. The Court held that the doctrine of estoppel cannot be used as a shield by the employer to deny hard-earned dues, particularly where the employee had continuously litigated for enforcement of his rights and had rendered service pursuant to court orders. The Court further held that imposing a fresh condition that the employee would be regularised only after completing another five years of satisfactory service, despite an earlier final direction for regularisation, reflected unequal bargaining power and could not defeat the employee’s lawful entitlement.
Summary: The appellant was appointed as a daily wage Cleaner with the Maharashtra State Road Transport Corporation on 1 April 1993 and was orally terminated in May 1994. The Labour Court found the termination illegal and directed reinstatement with continuity of service and back wages. Though he was taken back as a daily wager in 2003, he separately sought regularisation after completing 180 days of service. The Industrial Court, by order dated 12 January 2007, directed regularisation from the date of completion of 180 days against a clear vacancy under Clause 19(1) of the 1985 Settlement. Despite this, the Corporation regularised him only on 22 January 2011. The Labour Court later awarded back wages for the period from October 1993 to 20 January 2011, but the Bombay High Court set aside that award. The Supreme Court noted that the Industrial Court’s direction had attained finality and that the employee had been compelled to pursue repeated litigation to secure benefits lawfully due to him. It rejected the Corporation’s argument that the employee was estopped from claiming earlier benefits merely because he had accepted regular appointment from 2011.
Decision: The Supreme Court allowed the appeal, set aside the Bombay High Court’s judgment dated 1 August 2022, and restored the Labour Court’s award granting the appellant back wages of INR 8,09,218 for the period from October 1993 to 20 January 2011. However, considering the financial implications of interest from 1993, the Court reduced the interest rate from 12% to 8%. The appellant’s counsel was directed to furnish bank details within one week, and the respondent was directed to pay the amount with accrued interest within eight weeks, failing which the original 12% interest condition would revive. The Court also awarded INR 1,00,000 as litigation costs to the appellant and disposed of all pending applications.