Bangalore District Court
M/S Indo Mim Pvt Limited vs Manoj Kumar P S on 22 March, 2024
KABC010253372019
[C.R.P. 67] Govt. of Karnataka
Form No.9 (Civil)
Title Sheet for Judgment
in Suits(R.P.91)
IN THE COURT OF THE XXIV ADDITIONAL CITY CIVIL
JUDGE[CCH-6] HOLDING C/C OF XXXVIII ADDITIONAL
CITY CIVIL JUDGE AT BENGALURU[CCH-39]
Dated this the 22nd Day of March 2024
PRESENT
Sri.SHIVAKUMARA B B.A.,LL.B.,
XXXVIII Addl. City Civil & Sessions Judge, Bengaluru City.
O.S.No.5941/2019
PLAINTIFF : M/s INDO MIM PVT LIMITED having
its registered Office at No.12,
Sanjeev Basappa building,
Cunningham Crescent Road,
Bengaluru, Karnataka-560 052
represented by its Deputy General
Manager-HR Mr. Venkataramana
Pade
(By Sri. K.Diwakara, Advocate)
V/s.
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O.S.No. 5941/2019
DEFENDANTS : 1. Mr.P.S.Manoj Kumar, S/o PG
Subramaniyam, 1-101/21,
B.T.M.Street,Pudupet, Nagari-517
590, Chittoor District, Andhra
Pradesh, India.
2. M/s Neo Axis, represented by
its Director M.Shanmugan, Plot
566, 3rd Main, 2nd Stage Peenya
Industrial Estate, Bangalore-560
058, India
(placed exparte)
Date of Institution of the Suit: 13.08.2019
Nature of the suit (Suit on
Pronote, suit for declaration & Permanent Injunction
possession, suit for injunction) and damages
Date of commencement of 02.12.2021
recording of evidence:
Date on which the Judgment 22.03.2024
was pronounced:
Total Duration: Years Months Days
04 07 09
JUDGMENT
The Plaintiff has filed this suit against the defendants for permanent injunction and damages. 3
O.S.No. 5941/2019
2. The case of the Plaintiff, in brief, is that it is a Company registered under the Companies Act, 1956. It is a leading global supplier of precision-engineered products using Metal Injection Molding(MIM) as the core manufacturing technology.
The defendant No.1 was appointed as Assistant Engineer-Aerospace in the Plaintiff-Company with effect from 16.2.2015 and later confirmed as Assistant Engineer-Aerospace through Confirmation Letter Dt.1.3.2016. He served with the Plaintiff-Company from 16.2.2015 and submitted resignation on 3.09.2018, which was accepted and he was relieved of his duties through Relieving Order Dt.2.11.2018, which contains the provisions relating to unfair competition. The Plaintiff-Company also issued Service Certificate Dt.2.11.2018 to the Defendant No.1, which contains the provisions relating to the terms of the non-compete Agreement competition. The provisions of both Relieving Order as well as Service Certificate reads as under:- 4
O.S.No. 5941/2019
3.For a period of two years following cessation of employment with Company for any reason, you will not, as sole proprietor, employee, consultant, officer, director, shareholder, partner, joint venture or any other capacity.
4. Engage, directly or indirectly, in any commercial activity or line of business in which the Company is engaged.
5. Solicit or attempt to solicit,directly or indirectly,any company's customers.
6. Recruit or solicit, directly or indirectly any employee of the company or group company for employment with any other organizations engaged in any commercial activity or line of business in which the Company is engaged.
7. Reveal particulars or details of our methodologies, processes, technical know-how, administrative and organizational procedures, all information and material the employee and/or by its clients concerning their affairs which the employee may be privileged, to know by virtue of his being a member of the staff of the company.
8. Work to undermine the interest of the company and or compete with the company or work for other profit making organization directly or indirectly competing with the company.
The Plaintiff further contends that the Defendant No.1 had received an increased salary periodically as per the policy of the Company. During his employment, the Defendant No.1 had completed access to all the 5 O.S.No. 5941/2019 confidential information of the company relating to papers, patents, reports etc., and he was also privy to all the sensitive information relating to the job and duties assigned to him.
The Plaintiff further contends that the Defendant No.1 had also signed a Confidentiality Agreement on 16.2.2015, which contained Clause 4 regarding the purview and ambit of non-solicitation and non-disclosure among other terms of employment.
The Plaintiff further averred that the Defendant No.1 had voluntarily approached the Plaintiff-Company on 3.9.2018 and Defendant No.1 was subsequently relieved from his services on 2.11.2018. It has come to the notice of the Plaintiff-Company that the Defendant No.1 has taken up his employment with Defendant No.2, who is in the same line of business as that of Plaintiff- Company and he is actively persuading the current employees who are working under the Plaintiff-Company to resign and join the Defendant No.2 company. The 6 O.S.No. 5941/2019 Defendants are also soliciting, importuning and beseeching the customers of the Plaintiff-Company to do business with the Defendant No.2 company currently established by Defendant No.1.
The Plaintiff further averred that its employees by name Mr.Shambulingam and Mr.Selva Kumar submitted resignation and joined Defendant No.2 company, which indicates that the Defendant No.1 is soliciting and coaxing the employees of Plaintiff-Company to leave service and take up employment with Defendant No.2. Thus, the Defendant No.1 has committed breach of the Relieving Order, Service Certificate and Confidentiality Agreement duly signed between him and the Plaintiff- Company, and there is failure on the part of the Defendant No.1 to perform in a manner that meets the standards of the industry and he is guilty of coaxing/soliciting the employees of Plaintiff-Company for taking up employment with Defendant No.2 company and attempting to solicit, directly or indirectly any of the 7 O.S.No. 5941/2019 Plaintiff's customers in any manner to do the business with the Defendant No.2. The Plaintiff-Company has incurred incomparable loss in business due to loss of experienced and efficient business employees.
The Plaintiff further averred that owing to the breach of contract by the Defendant No.1 and lack of apathy on the part of Defendant No.1 towards honouring its obligations, the Plaintiff finds itself with no other option but legal recourse. The said inaction from the Defendant is willful and seems to be aimed at an unlawful financial gain at the cost of the Plaintiff. The legal notice Dt.21.12.2018 was issued to this effect to the Defendant, but the Defendant has not sent any response to the Plaintiff. Hence, this suit is filed for damages for breach of contract wherein the Plaintiff-Company has incurred incomparable loss in business due to loss of experienced and efficient business employees as well as for immense loss in business due to loss by poaching of customers by the Defendants and for Permanent 8 O.S.No. 5941/2019 Injunction restraining the Defendants from recruiting, hiring, employing the employees working or on the notice period of the Plaintiff-Company, as well as poaching of customers of the Plaintiff-Company until expiry of 2 years period of non-solicitation of employees and customers and for damages of Rs.10,000/- for breach of contract.
3. After issuance of suit summons, the defendants did not appear before the Court, hence they have been placed ex-parte by Order Dt.16.3.2021.
4. On the basis of above averments. the points that arise for my consideration are as under:
1. Whether the Plaintiff-Company proves that the defendant No.1 is coaxing/soliciting the employees of Plaintiff-
Company for taking up employment with Defendant No.2 company and attempting to solicit, directly or indirectly any of the Plaintiff's customers in any manner to do the business with the Defendant No.2?
2. Whether the plaintiff is entitled for permanent injunction?
3. Whether the Plaintiff is entitled for damages from the Defendants?
4. What decree or order?
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O.S.No. 5941/2019
5. In order to prove the case of the Plaintiff- Company, the Senior Manager of the Plaintiff-Company Mr.Praveen G is examined as PW1 and got marked documents at Ex.P1 to Ex.P9 and closed his side.
6. Heard learned counsel for the Plaintiff and perused the records.
7. My findings to the above points are as under:
Point No.1 to 3 - In the Negative Point No.4 - As per the final order for the following:
REASONS POINT Nos.1 to 3 :-
8. Since these points are inter-linked with each other, they are taken up together for discussion to avoid repetition of facts.
9. The Plaintiff contends that the Defendant No.1 was employed with the Plaintiff-Company in the year 2015 and resigned in the year 2018. In the relieving letter Dt.2.11.2018 there is a clause which reads that for a 10 O.S.No. 5941/2019 period of two years following cessation of employment with the Plaintiff-Company for any reason, the Defendant No.1 shall not engage, directly or indirectly, in any commercial activity or line of business in which the Plaintiff-Company is engaged; solicit or attempt to solicit,directly or indirectly,any customer of the company; recruit or solicit any employee of the company for employment with any other organizations engaged in any commercial activity or line of business in which the Plaintiff-Company is engaged; reveal particulars or details of company's methodologies, processes, technical know- how or any information provided to him by the company. In violation of the same, the Defendant No.1 joined the Defendant No.2 company which is engaged in the same business that of Plaintiff and further has solicited employees of Plaintiff-Company by name Mr.Shambulingam and Mr.Selva Kumar to join Defendant No.2 company. Hence, the present suit is filed. 11
O.S.No. 5941/2019
10. In order to prove the case of the Plaintiff- Company, its Senior Manager by name Mr.Praveen is examined as PW1. In his affidavit filed in lieu of chief examination, PW1 has reiterated the plaint averments. He has further deposed that in violation of the clause in the Relieving Order that for a period of two years following cessation of employment with the Plaintiff- Company, for any reason, the Defendant No.1 shall not engage, directly or indirectly, in any commercial activity or line of business in which the Plaintiff-Company is engaged; solicit or attempt to solicit,directly or indirectly,any customer of the company; recruit or solicit any employee of the company for employment with any other organizations engaged in any commercial activity or line of business in which the Plaintiff-Company is engaged; reveal particulars or details of company's methodologies, processes, technical know-how or any information provided to him by the company, the Defendant No.1 joined the Defendant No.2 company 12 O.S.No. 5941/2019 which is engaged in the same business that of Plaintiff and further has solicited employees of Plaintiff-Company by name Mr.Shambulingam and Mr.Selva Kumar to join Defendant No.2 company.
11. In support of his oral evidence, PW1 has produced and got marked documents Ex.P1 to Ex.P9. Ex.P1 is Resolution passed by the Plaintiff-Company Dt.16.3.2022 authorizing PW1 to depose before this Court. Ex.P2 is Confirmation letter Dt.1.3.2016 issued by the Plaintiff-Company to Defendant No.1 regarding his employment w.e.f. 1.3.2016. Ex.P3 is the Resignation letter given by Defendant No.1 to the Plaintiff-Company resigning from the Plaintiff-Company. Ex.P4 is the Relieving Order Dt.2.11.2018 issued by the Plaintiff- Company to Defendant No.1. Ex.P5 is the Service certificate Dt.2.11.2018 issued by the Plaintiff-Company to the Defendant No.1. Ex.P6 is the Confidentiality Agreement Dt.16.2.2015 entered into between the Plaintiff-Company and Defendant No.1. Ex.P7 is the legal 13 O.S.No. 5941/2019 notice Dt.21.12.2018 issued on behalf of the Plaintiff- Company to Defendants No.1 and 2. Ex.P8 is the postal acknowledgment and Ex.P9 is the courier receipt.
12. It is significant to note that the main version of the Plaintiff is that the Defendant No.1 had voluntarily approached the Plaintiff-Company to offer his resignation from the services and accordingly the Plaintiff-Company has got relieved Defendant No.1 from his services on 2.11.2018, which is evident from Ex.P4, the Relieving Order. The only contention and grievance of the Plaintiff is that after having relieved Defendant No.1 from his services, it was brought to the notice of the Plaintiff that the Defendant No.1 has been actively persuading/ soliciting the current employees who are rendering the services with the Plaintiff-Company to take up employment with the company in which the Defendant No.1 is currently employed. Further, the Defendants No.1 and 2 are also soliciting, importuning and beseeching the customers of the Plaintiff-Company to do business with 14 O.S.No. 5941/2019 the Defendant No.2 company currently established by Defendant No.1. It has also come to the notice of the Plaintiff that its employees by name Mr.Shambulingam and Mr.Selva Kumar have submitted their resignation to the Plaintiff-Company and have joined Defendant No.2 company,thereby the Defendant No.1 has committed breach of the Relieving Order Dt.2.11.2018 and also Service Certificate Dt.2.11.2018 as per Ex.P4 and P5 respectively.
13. It is significant to note that except Ex.P1 to P9, the Plaintiff/PW1 has not produced any document to show that the Defendant No.1 has been actively persuading/soliciting the current employees who are rendering the services with the Plaintiff-Company to take up employment with the company in which the Defendant No.1 is currently employed. No documents are produced by the Plaintiff to show that the Defendants 1 and 2 are also soliciting, importuning and beseeching the customers of the Plaintiff-Company to do business with 15 O.S.No. 5941/2019 the Defendant No.2 company currently established by the Defendant No.1. Even the Plaintiff has not placed any material to show that the employees by name Mr.Shambulingam and Mr.Selva Kumar who were working with the Plaintiff-Company have submitted their resignation to the Plaintiff-Company and joined Defendant No.2 company. Except the above said documents including Ex.P4, the Relieving Order Dt.2.11.2018 and Ex.P6, Confidentiality Agreement Dt.16.2.2015 entered into between Plaintiff and Defendant No.1, the Plaintiff has not placed any material or document to show that the Defendant No.1 has committed breach of the Relieving Order Dt.2.11.2018 and also Service Certificate Dt.2.11.2018 along with Confidentiality Agreement Dt.16.2.2015 duly signed by the Defendant No.1 and the Plaintiff. There are no any material to show that there is violation on the part of Defendant No.1, without legal excuse, to perform any promise that forms all or part of the contract. Except oral 16 O.S.No. 5941/2019 evidence of PW1, there is no any supporting documentary evidence to prove the abovesaid version taken up by the Plaintiff. Even the Plaintiff has not placed any material to show that the Plaintiff-Company has incurred incomparable loss in business due to loss of experienced and efficient business professionals/employees as well as for the immense loss in business due to loss by poaching of customers by the Defendants. Considering facts and circumstances of the case, evidence of PW1 both oral and documentary material available on record and also for the abovesaid reasons, I am of the opinion that the Plaintiff has failed to prove Point Nos.1 to 3. Since the Plaintiff has not established his case, he is not entitled to any relief sought for. Therefore, points Nos.1 to 3 are answered in the Negative.
POINT No.4 :-
14. In view of my findings on Point Nos.1 to 3, I proceed to pass the following:
17
O.S.No. 5941/2019 ORDER The suit of the Plaintiff-Company is hereby dismissed.
(Dictated to the Stenographer-I, transcribed and typed by her, corrected, signed and then pronounced by me in the open court, on this the 22nd Day of March 2024).
(SHIVAKUMARA B) XXXVIII Addl. City Civil & Sessions Judge, Bengaluru.
ANNEXURE I. List of witnesses examined for Plaintiff :
PW1 Mr.Praveen II. List of documents marked for the Plaintiff :
Ex.P1 Board resolution Dt.16.3.2022. Ex.P2 Confirmation letter Dt. 1.3.2016. Ex.P3 Resignation letter Dt. 3.9.2018. Ex.P4 Reliving order Dt.2.11.2018. Ex.P5 Service certificate Dt.2.11.2018.
Ex.P6 Confidentiality Agreement
Ex.P7 Legal notice Dt.21.12.2018
Ex.P8 Postal Acknowledgment
Ex.P9 Courier receipt.
( SHIVAKUMARA B)
XXXVIII Addl. City Civil & Sessions
Judge, Bengaluru.
18
O.S.No. 5941/2019
ORDER
The suit of the Plaintiff-Company
is hereby dismissed. (vide separate Judgment) ( SHIVASHANKARA B) XXXVIII Addl. City Civil & Sessions Judge, Bengaluru.