Delhi District Court
Fiit Jee Limited vs Bansal Classes Kota on 8 September, 2017
IN THE COURT OF MS. ASHA MENON: DISTRICT & SESSIONS JUDGE (SOUTH DISTRICT) SAKET: NEW DELHI CISCS DJ1032017 CNRDLST 010009732017 FIIT JEE Limited (A company incorporated under the provisions of Companies Act, 1956) having its registered office At 29A, ICES House, Kalu Sarai, Sarva Priya Vihar New Delhi110 017 .....Plaintiff Versus 1. Bansal Classes Kota Through Mr. V.K. Bansal 2K17, Vigyan Nagar, KOTA (Rajasthan) 2. Dr. P.K. Sharma Head of the Deptt of Mathematics FIIT JJE Limited, 29A, ICES House, Kalu Sarai, Sarva Priya Vihar New Delhi110 017 3. Shri Partha Haldar Incharge FIITJEE Limited (North West Centre) and Faculty of Chemistry, Punjabi Bagh Central Market, New Delhi110026. ......Defendents. Date of Institution:25.05.2005 Judgment reserved on: 10.08.2017 Judgment pronounced on: 08.09.2017 JUDGMENT
A suit for permanent injunction was instituted by the FIITJEE Limited against Bansal Classes Kota for defendant no.1, Dr. CISCS DJ1032017 Page 1 of 12 P.K. Sharma, Head of Department of Mathematics, FIITJEE Limited, defendant no.2 and Shri Partha Haldar, Incharge FIITJEE Limited (NorthWest centre) and Faculty of Chemistry, defendant no.3 for permanent injunction before the Hon'ble High Court of Delhi. Pursuant to Notification No. 27187/DHC/Orgl. dated 24.11.2015 as amended on 24.07.2016 as communicated vide letter dated 25.07.2016 received from the Hon'ble High Court of Delhi, the case has been transferred to this Court and is accordingly being disposed off.
PLEADINGS The plaintiff has claimed to be a leading Coaching Centre for students interested in joining IIT and appearing in the JEE. The plaintiff claimed that due to its efforts and training imparted to its faculty members from 3 to 9 months and the study material developed by it, it had developed a good reputation amongst the students and had generated huge goodwill and satisfaction amongst the students and parents. The plaintiff claimed to have facilitated the maximum selection in IIT & JEE for six years in a row due to the efforts put by the plaintiff and its reputed faculty in grooming children for these exams.
It is further stated that good faculty is a great asset and the defendant no.1 was indulging in poaching good faculty of the plaintiff. It is submitted that this resulted in the goodwill of the plaintiff company being adversely affected as replacement of the faculty was not easy and students suffer midway in the training programme due to the poaching of the faculty members by the defendant no.1. It is submitted that the defendants no.2 and 3 had CISCS DJ1032017 Page 2 of 12 received letters which were computer generated which disclosed that the defendant no.1 was indulging in poaching and that in the month of May, 2005 Shri Rajan Agarwal Faculty of Mathematics with the plaintiff and Shri Girish Gaur, CenterInCharge of the plaintiff company at Kota had reportedly been poached by the defendant no.1. It is submitted that from the words used in the computer generated letter, it is clear and apparent that it was the defendant no.1 that was trying to dent the faculty of the plaintiff and to encourage them to leave the plaintiff's company and cause severe desertion in the rank of the plaintiff company. It is submitted that the defendant no.1 was also obtaining undue advantage by taking away good faculty members of the plaintiff company being a competitor in the field. Thus, it was indulging in tortious conspiracy and adopting various methods to allure defendants no. 2 & 3 and other faculty members of the plaintiff to leave the plaintiff and join the defendant no.1.
It is submitted that this illegitimate practice had caused huge loss to the plaintiff and that the only relief that the plaintiff was seeking was an injunction against the defendant no.1, its representatives etc. restraining them from poaching the faculty members of the plaintiff company including defendants no. 2 and 3 or in any manner directly or indirectly instigating or causing to instigate the faculty members of the plaintiff company to join the defendant no.1. A further restraint is also sought on defendants no.2 and 3 from joining defendant no.1 on account of the poaching triggered by the defendant no.1. Costs of the suit was also prayed.
The defendants no.2 and 3 did not participate in the suit despite being served.
CISCS DJ1032017 Page 3 of 12The written statement has been filed on behalf of the defendant no.1 and it was submitted that the suit was liable to be rejected under Order 7 Rule 11(a) CPC, as it was an imaginary suit without cause of action.
On merits, the defendant no.1 claimed to be imparting specialized coaching to the aspiring students for admissions to IITs since 1991 having high respect and repute in the field of specialized coaching institutions. The defendant no.1 has claimed to have put a small town of Kota on the national map due to the quality of coaching that he was imparting. It was submitted that there were minimum qualification marks for getting admission in the defendant's institute which were 75% for 10th or 12th and also the clearance of a written test. It was submitted that the defendant no.1 institute had been felicitated with number of awards and for dragging the defendant no.1 into frivolous litigation exemplary costs be imposed upon the plaintiff.
The defendant no.1 has further stated in the written statement that it makes recruitment of faculty members after following strict procedure and strictly on the basis of merits. It was submitted that the defendant no.1 called for applications through advertisements in prominent newspapers. Thereafter, the HR department scrutinized the applications and short listed the applicants who are then called for a written test, technical interview, commercial interview and were also required to give demo classes.
It was claimed that in the year 2005 advertisements had been issued in March, June, August and September in the 'Times of India' and 'Dainik Bhaskar Raipur' for various faculty members. The defendant no1. submitted that in response to the advertisement of CISCS DJ1032017 Page 4 of 12 30.03.2005, 94 applicants for physics, 78 applicants for chemistry and 63 applicants for Maths faculty had applied. In response to the advertisement of 29.06.2005 these figures were 88, 49, and 35 respectively. In response to the advertisement of 10.08.2005 the response was 52, 05 and 15 respectively. In response to the advertisements of 11.09.2005 and 14.09.2005, 41, 37 and 40 persons respectively applied for being appointed as faculty members. Amongst these were Shri Ranjan Aggarwal and Shri Girish Garg, who had applied on 01.04.2005 and 02.04.2005. It is submitted that two of the faculty members of the defendant no.1 Shri Saurabh Gangal and Shri Dinesh Dubey had left the defendant no.1 to join the plaintiff. Similarly, Shri Gyan Prakash Kesarmani had left the defendant no.1 to join the plaintiff in 2004. Thus, it was submitted that the plaintiff had been employing the exfaculty of the defendant no.1, and the present suit was a completely frivolous and malafide one.
It is further submitted that the suit was a collusive suit as the defendants no.2 and 3 were faculty members of the plaintiff and that the so called letters had been fabricated for filing in the Court. It was submitted that the allegations were wild, imaginary and completely illegal without any basis. It was submitted that there was no privity of contract between the plaintiff and the defendant no.1 and that if at all there was any breach of agreement between the plaintiff and its faculty members, the plaintiff could have sued them. It was submitted that there was no right against the defendant which could be enforced by the plaintiff. Thus, the defendant no.1 prayed that the suit be dismissed with exemplary costs.
Replication was filed by the plaintiff reiterating the CISCS DJ1032017 Page 5 of 12 claims in the plaint and disputing the averments in the written statement. It is submitted that the plaintiff had set out a case on cogent and reasonable reasons supported by facts and circumstances and that the act of the defendant no.1 being an act of poaching was committed against defendant no.1 in order to cause wrongful loss to the plaintiff and wrongful gain to the defendant no.1 and therefore, was malafide. Thus, it was submitted that the case was maintainable against the tortious conspiracy of the defendant no.1 to dismantle the business of the plaintiff. Thus, it was prayed that the suit be decreed in favour of the plaintiff.
ISSUES On the basis of the pleadings, the following issues were framed by the Hon'ble High Court on 05.04.2006: (1) Whether the suit is not maintainable?OPD (2) Whether the suit does not disclose cause of action? OPD (3) Whether the facts of the suit give rise to the act and endeavour of poaching and if so, whether it is illegal? OPP (4) Whether the suit is collusive?OPD (5)Whether the plaintiff is entitled to a decree for permanent injunction against the defendants?OPP (6) Relief.
EVIDENCE Thereafter, the plaintiff examined Shri Ateet Mittal as PW1 and Shri Ashish Gupta as PW2. The defendants examined Shri Ambarish Kumar as DW1.
The suit was thereafter, transferred to this Court.
CONTENTIONS I have heard the arguments advanced by Shri Neeraj CISCS DJ1032017 Page 6 of 12 Malhora, Ld. Senior Counsel alongwith Shri Rahul Goyal and Ms. Abhinandana Kain on behalf of the plaintiff. However, none appeared on behalf of the defendant no.1 to argue the matter. The defendants no.2 and 3 were proceeded ex parte vide orders dated 25.05.2009 of the Hon'ble High Court. However, there is no order proceeding against the defendant no.1 ex parte.
Ld. Counsel for the plaintiff argued that the permanent injunction has been sought against the poaching of the employees leading to loss of goodwill and, therefore, monetary loss. It was submitted that since no injunction can be issued to restrain the defendants from seeking any employment, the prayer to that extent made in the plaint was being given up. However, relying on the judgment of the Hon'ble High Court of Calcutta in 'Electrosteel Castings Ltd. Vs Saw Pipes Ltd. and Others', 2206 (4) L.L.N.458, it was submitted that the relief claimed for an injunction against the defendant no.1 from poaching be granted to the plaintiff.
The Ld. Counsel submitted that this was a tortious act and not based on contract and, therefore, was an injunction that could be granted by the Court. It is submitted that the two witnesses had brought on record the documents namely, the letter which could be clearly connected to the defendant no.1 as the words used AKOT meant 'KOTA Centre', PJIARPU meant 'JAIPUR Centre' and RJEMA meant 'AJMER Centre'. The letters showed that the defendant no.1 was interfering with the business of the plaintiff by trying to induce a breach of contract. The taking away of the faculty had a direct effect on the goodwill, therefore, the inducement to breach the contract of employment with the plaintiff was the commission of an act which CISCS DJ1032017 Page 7 of 12 was contrary to the interest of the plaintiff. Therefore, injunction be issued.
FINDINGS ON ISSUES After hearing the arguments and considering the material on record, my findings on the issues are as follows: Issue No.1.Whether the suit is not maintainable?OPD The defendant had to establish as to how the suit was not maintainable. It has failed to bring forth any material on which it could be concluded that the suit was not maintainable. Of course, with regard to the prayer that the defendants no.2 and 3 be injuncted from moving out of the employment of the plaintiff, the same is hit by Section 42 of the Specific Relief Act and to that extent no doubt the suit is not maintainable. However, in the course of the arguments, the Ld. Counsel for the plaintiff has himself gave up that prayer. Thus, this issue is answered against the defendants and in favour of the plaintiff.
Issue No.2 Whether the suit does not disclose cause of action?OPD.
The reason why the defendant no.1 claimed that the suit was not maintainable was on the ground that there was no cause of action to claim the injunction and that no such injunction in any case could be granted, as there is no privity of contract between the plaintiff and the defendant no.1. A cause of action cannot be confused with the merits of a claim. The defence set up cannot be considered in determining the question whether there exists a cause of action or not. It is on the averments made in the written statement that it is claimed that there is no cause of action but in the plaint, the cause of action CISCS DJ1032017 Page 8 of 12 claimed is the loss of two faculty members and the alleged luring of the defendants no. 2 and 3 by the defendant no.1 while they continued to be in the employment of the plaintiff. The bundle of facts on which the relief of injunction was claimed has been disclosed. Thus, it cannot be said that the suit did not disclose any cause of action. This issue is to be answered in favour of the plaintiff and against the defendants.
Issue No.3 Whether the facts of the suit give rise to the act and endeavour of poaching and if so, whether it is illegal?OPP The onus was on the plaintiff to have established that the defendant no.1 had endeavoured to poach and that such an endeavour was illegal. In order to substantiate the case, the plaintiff brought on record two documents namely, Ex.PW1/1 and Ex.PW1/2 alongwith their annexures. Neither the defendant no.2 nor the defendant no.3 appeared in the witness box to testify about the receipt of these letters. The witnesses who have come are PW1 Shri Ateet Mittal and PW2 Shri Ashish Gupta. Therefore, the defendants objected to the exhibition of these documents and rightly so. PW1 Shri Ateet Mittal in his crossexamination has admitted that he was not sure as to from where these two letters Ex.PW1/1 and Ex.PW1/2 had come. He has admitted that the name of defendant no.1 does not appear directly in either of the letters. He has admitted that these were computer generated letters. He has admitted that he has never been personally served with any letter trying to poach him.
As regards, PW2 Shri Ashish Gupta, he also admitted that the name of the defendant no.1 was not mentioned in Ex.PW1/1 but claims that it is mentioned indirectly. Thus, it is clear that the CISCS DJ1032017 Page 9 of 12 conclusions drawn are of the plaintiff's witnesses; the ones who had received the letters have not testified to such receipt and the impact on them. There is nothing to connect these two letters Ex.PW1/1 and Ex.PW1/2 with the defendant no.1. Thus, it is the considered view of this Court that these letters do not help the plaintiff in establishing that the defendant no.1 was indulging in illegal poaching.
On the other hand, the defendant no.1 has filed the affidavit of Ambarish Kumar Tiwari as DW1 who has deposed to the procedure whereby faculty is recruited in their institution. He has deposed that the advertisements are issued in the National Newspapers after which the applications are scrutinized and applicants are shortlisted. He has deposed that the applicants who are shortlisted take a written test which is followed by interviews (Technical & Commercial) and thereafter, demo classes are also held. He has also placed on record the copies of these advertisements.
He has deposed that in March, 2005 there were 59 faculty members. Since 1st April, 2005, 16 more persons have joined. He also deposed that three of their faculty members have left them and joined the plaintiff being Shri Saurabh Gangal, Shri Dinesh Dubey and Shri Gyan Prakash. During the crossexamination, the witness reiterated their procedure of advertising for faculty who are then recruited through written exam, interview and other skill test. The suggestion was denied that no such advertisement was given. The other questions relating to MRTP petition were put to the witness but nothing has come out in the crossexamination which would show that the defendant no.1 had a devious method of recruiting faculty and not a straight forward method of advertisement and suitability testing.
CISCS DJ1032017 Page 10 of 12It is therefore, clear from the evidence brought on record by the defendant no.1 that it was not indulging in poaching whether legal or illegal. The witnesses of the plaintiff have themselves admitted that there was no written contract between the faculty members and the plaintiff and in any case there could have been no contract prohibiting them from applying to other institutes for the betterment of their future prospects. Thus, in the totality of the evidence that has come on the record, it is clear that this issue has to be answered against the plaintiff and in favour of the defendant no.1 that the facts do not establish any endeavour of poaching and there was no act that was illegal as far as recruitment of faculty members by the defendant no.1 is concerned. This issue is accordingly, answered.
Issue No.4 Whether the suit is collusive?OPD It was the defendant no.1 who submitted that the suit was not maintainable and it had no cause of action and further the suit was collusive. It is no doubt true that the defendants no. 2 and 3 were in the faculty of the plaintiff and have not chosen to contest the suit but that would not make the suit collusive. The defendants no. 2 and 3 purported to have informed the plaintiff about the intention of the defendant no.1 to whisk them away to the detriment of the plaintiff. The relief that was claimed against the defendants no. 2 and 3 was that they be injuncted from moving out of the plaintiff's employment. Obviously, such an injunction cannot be granted under law. In these circumstances, the Issue No.4 is to be answered against the defendant no.1 and in favour of the plaintiff that the suit is not collusive.
Issue No.5 Whether the plaintiff is entitled to a decree for permanent injunction against the CISCS DJ1032017 Page 11 of 12 defendants?OPP The plaintiff having failed to establish what right of his has been violated by the defendant no.1 cannot seek any decree for permanent injunction against the defendant no.1. As noted hereinabove, no injunction could be issued against defendants no. 2 and 3 to restrain them from seeking employment in other institutions. The judgment of the High Court of Calcutta has no application to the facts of the present case, there being no written contract of employment and there being nothing on record to show that the defendant no.1 had induced the defendants no.2 and 3 or any other person to break that contract. It is only if such evidence existed that the question would have to determined as to whether such inducement to an employee was to break the contract and not merely to end it and would amount to a tortious.
In these circumstances, this issue has to be answered against the plaintiff and in favour of the defendant no.1 that the plaintiff is not entitled to seek permanent injunction against the defendant no.1 or defendant no.2 and 3.
Relief.
Since the plaintiff has been found not entitled to any injunction, no relief can be granted to the plaintiff. The suit is accordingly dismissed. In the circumstances, parties to bear their own costs. Decree sheet be prepared accordingly.
The file be consigned to the Record Room.
Announced in open Court
today i.e. 08.09.2017 (ASHA MENON)
District & Sessions Judge (South)
Saket/New Delhi.
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