Delhi District Court
National Institute Of Fashion ... vs Shahrukh Zaidi on 2 August, 2011
In the Court of Dr. Rakesh Kumar: Commercial Civil Judge of
North Delhi District at Tis Hazari Courts, Delhi.
Suit No.: 222/08
In the matter of :
National Institute of Fashion Technology ..... Plaintiff
Versus
Shahrukh Zaidi ..... Defendant
ORDER
1. This order shall decide an application under Order 37 read with Section 5 of the Limitation Act read with Section 151 CPC made on behalf of the defendant for leave to appear and defend the case.
2. The brief facts for the disposal of present application are that it is clearly mentioned in clause (2) of the Order 37 that this order applies only to bill of exchange, hundies, promissroy notes, written contract, on an enactment or on a guarantee and the present suit is based on an indemnity bond which is neither a bill of exchange, hundies nor the promissory note; that the amount claimed in the suit is not the amount mentioned in the indemnity bond; that the contract between the plaintiff and the defendant was an appointment for a given fixed period for a salary of Rs.40,000/ per month and not as stated by the plaintiff; that the target amount of Rs.5/ lacs and Rs.3.5 lacs per quarter, as alleged, are self contradictory; that the defendant was forced to leave the organization in compelling circumstances, contrary to 1 service rules; that the defendant was entitled to grant of leave during the period of contract, as per General Services Rules of NIFT but the subsequent developments, a circular dated 15.09.06 and some other notings, particularly refer to page 61/File no.NIFT/Project/1614(2)ILGA.CLE/05, steer towards dis allowance of leave; that the above said circumstances is the total violation of the contract by the plaintiff; that the plaintiff by way of unilateral directions/decisions kept on fostering on the defendant to comply with, exercising undue influence it enjoyed by virtue of its position vizaviz defendant, which directions/ impositions never formed a part of the agreement dated 21.07.05, and were, therefore, bad in law and flagrant violation of the agreement; that the plaintiff breached the agreed terms of paying 5% incentive; that the defendant has delivered much beyond the set target; that as per the terms the defendant should have received an incentive of 5% on the generated revenue, instead 12.44% service tax, Rs.2.0 lakhs of priority membership amount, the set target figure are being deducted to arrive at the ridiculous figure or Rs.1175/; that the above said conduct of the plaintiff compelled the defendant to leave the job; that the defendant was wrongly penalized of charging of an interest @ 10.5% for the period of retention of amount, however, it was explained in writing in details to the management that the amount has already been utilized for the company; that the indemnity bond is stated 2 to be executed for the due fulfillment of the terms and conditions of letter no. NIFT/Estt(HO)/Designer(SZ)(VB)/2005 dated July 21, 2005 which nowhere provides for execution of any indemnity bond for any cause whatsoever; that clause 5 of the said letter is very explicit to record the agreement that the contract could be terminated by either party by giving the other party a month's notice in writing, without assigning any reason; that the delay, if any, in filing of the present application has been caused due to a distance of thousand miles and the same is requested to be condoned.
3. The plaintiff opposed the present application by filing reply wherein contended that the defendant was appointed as Designer in NIFT vide appointment letter dated 21.07.05; that as per the terms of the appointment letter the defendant was on contract appointment for a period of three years from the date of joining i.e. 01.08.05; that as per the terms of the appointment letter dated 21.07.05, the defendant was to generate revenue of Rs.5.00 lakhs per quarter and that the first six months were given as grace period to the defendant to generate the revenues and the revenue not generated during this period was to be carried forward to the remaining two quarters; that in case the revenue was more than the target of Rs.5.0 lakhs then the defendant was to get an incentive of 5% for the excess amount of revenue generated by him and in case of shortfall, the defendant was 3 required to pay penalty of 5% of the target amount; that the defendant could generate only Rs.1.20 lakhs during the period from August 2005 to August 2006 and the target of revenue was reduced to Rs.3.5 lakhs per quarter from September, 2005 onwards; that upon assurance given, the defendant executed in writing the Indemnity Bond dated 05.09.06 wherein the defendant had undertaken that he would compensate NIFT for the losses due to the cost and expense involved in fresh recruitment by undertaking to pay a sum of Rs.2.0 lakhs as damages; that vide letter No. NIFT/LDC/Resignation letter dated 24.04.07, the defendant tendered his resignation w.e.f. 30.04.07 prior to the expiry of the term of appointment which was to continue till July, 2008.
4. I have heard counsel for the parties and perused the material available on record carefully.
5. It is submitted by counsel for the defendant that the defendant was forced to leave the organization in compelling circumstances, contrary to service rules.
6. It is submitted by counsel for the plaintiff that no triable issue has been raised on behalf of the defendant and the application is liable to be dismissed.
7. I have given my thoughtful consideration to the submissions made on behalf of the parties.
8. By way of present application it is alleged by the respondent 4 that the contract between the plaintiff and the defendant was an appointment for a given fixed period for a salary of Rs.40,000/ per month and not as stated by the plaintiff. It is further alleged that the plaintiff by way of unilateral decisions kept on fostering on the defendant to comply with, exercising undue influence it enjoyed by virtue of its position vizaviz defendant, which directions never formed a part of the agreement dated 21.07.05. It is further alleged that the plaintiff breached the agreed terms of paying 5% incentive and the defendant has delivered much beyond the set target. It is further alleged that the above said conduct of the plaintiff compelled the defendant to leave the job. It is further alleged that the defendant was wrongly penalized of charging of an interest @ 10.5% for the period of retention of amount, however, it was explained in writing in details to the management that the amount has already been utilized for the company. In these circumstances, I am of the opinion that the defendant has disclosed certain facts which entitles him to grant leave to defend the suit. For these reasons, present application under Order 37 Rule 3(5) CPC is allowed.
Announced in the open court (Dr. Rakesh Kumar)
on 02.08.2011 Civil Judge: North Delhi District
Tis Hazari Courts, Delhi
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