Karnataka High Court
Welldoc Sofware Private Limited vs Vivek Anand Y on 29 August, 2025
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NC: 2025:KHC:34328
RFA No. 604 of 2023
HC-KAR
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 29TH DAY OF AUGUST, 2025
BEFORE
THE HON'BLE MRS. JUSTICE K.S. HEMALEKHA
REGULAR FIRST APPEAL NO.604 OF 2023 (DEC)
BETWEEN:
WELLDOC SOFTWARE PRIVATE LIMITED
OFFICE AT: BRIGADE SOFTWARE PARK-I,
UNIT 501, 5TH FLOOR, B-WING,
NO.42, 27TH CROSS,
BANASHANKARI 2ND STAGE,
BANGALORE-560070.
BEING REPRESENTED BY ITS
AUTHORIZED REPRESENTATIVE
MR. BILLY GRAHAM, DIRECTOR.
...APPELLANT
(BY SRI SYED SHUJATH MEHDI, ADVOCATE)
AND:
VIVEK ANAND .Y
S/O PRASAD GNANA YAGNAMOORTHY,
AGED ABOUT 38 YEARS,
Digitally signed by FLAT NO.203, SUBODHYA RESIDENCY,
MAHALAKSHMI B M NO.271, 5TH MAIN,
Location: HIGH VIJAYA BANK LAYOUT,
COURT OF BANGALORE-560027
KARNATAKA
EMAIL: [email protected]
...RESPONDENT
(BY SRI A.J. SRINIVASAN, ADVOCATE FOR C/R)
THIS RFA IS FILED UNDER SECTION 96 R/W ORDER 41 RULE 1
OF CPC AGAINST HE JUDGMENT AND DECREE DATED 25.08.2022
PASSED IN O.S.NO.6666/2019 ON THE FILE OF THE XII ADDITIONAL
CITY CIVIL AND SESSIONS JUDGE, BENGALURU CITY. DECREEING
THE SUIT FOR DECLARATION AND DAMAGES.
THIS APPEAL, COMING ON FOR , THIS DAY, JUDGMENT WAS
DELIVERED THEREIN AS UNDER:
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NC: 2025:KHC:34328
RFA No. 604 of 2023
HC-KAR
CORAM: HON'BLE MRS. JUSTICE K.S. HEMALEKHA
ORAL JUDGMENT
The present appeal is preferred by the defendant against the judgment and decree dated 25.08.2022 in O.S. No.6666/2019 passed by the XII Additional City Civil and Sessions Judge, Bengaluru (CCH-27) (hereinafter referred to as 'Trial Court' for short), whereby the plaintiff's suit was decreed, holding his termination arbitrary, unjustified and stigmatic, awarding him Rs.10.00 lakhs with interest and directing issuance of relieving letter without stigma.
Brief Facts Plaint Averments:
2. The plaintiff joined the defendant-company and was appointed as a Senior Programmer/Analyst on 01.04.2010. The plaintiff rendered 10 years of blemish free service, was recognized for his contributions and was awarded as 'Employee of the Quarter'. On 04.06.2018, -3- NC: 2025:KHC:34328 RFA No. 604 of 2023 HC-KAR without any prior notice, the defendant-company abruptly terminated his service by issuing Ex.P.2, alleging breach of confidentiality and misconduct and was asked to handover the laptop and leave immediately. It is stated that the termination order was stigmatic and defamatory, attaching allegations of theft of intellectual property and breach of trust, without affording him any opportunity to explain. It is stated that repeated requests for reasons, through e-
mails went unanswered. His gratuity was forfeited, leave settlement withheld, and no relieving letter was given. That the plaintiff suffered mental agony, loss of reputation and loss of livelihood. He sought a declaration that the termination was arbitrary and opposed to natural justice, for a stigma free relieving letter, settlement of benefits, and damages of Rs.10.00 lakhs.
Written statement:
3. The defendant contended that the termination was not arbitrary, but was due to serious misconduct by the plaintiff. During an internal audit, in the year 2018, a -4- NC: 2025:KHC:34328 RFA No. 604 of 2023 HC-KAR laptop of an Ex-Director, Matti Prasad, revealed skype chats and e-mails which showed that the plaintiff and the colleagues had collaborated with the competitor, Amalgam RX, to develop a rival product 'Isage'. The plaintiff had breached the confidentiality and non-solicitation agreement dated 23.06.2010 and violated Clause 13 of the Appointment Agreement, which permitted termination for misconduct or breach of confidentiality. An internal enquiry was held, and on 04.06.2018, the plaintiff refused to cooperate and attempted to delete the files from his laptop and hence, his services were terminated.
4. The defendant denied the liability for any damages. It argued that awarding Rs.10.00 lakhs as damages is unsustainable and at best, the plaintiff can claim contractual dues, if any under Ex.D.5.
Findings of the Trial Court:
5. The Trial Court held that the termination was stigmatic and arbitrary since no proper enquiry was -5- NC: 2025:KHC:34328 RFA No. 604 of 2023 HC-KAR conducted. The Trial Court observed that Ex.P.16-skype chat as hearsay and as only a 'plan', not proof of actual misconduct. It noted that the employer did not issue a charge-sheet, did not hold a formal enquiry, and terminated abruptly, which amounted to stigmatic termination without due process. Because stigma can damage the plaintiff's future career, the Court directed the plaintiff be issued a relieving letter, 'without attaching any stigma or allegations' and awarded damages holding that the defendant's conduct was high handed, arbitrary, violative of principles of natural justice.
6. Heard the learned counsel appearing for the appellant and learned counsel for the respondent.
Contentions of the appellant:
7. Learned counsel for the appellant-defendant submits that the oral notice was indeed issued to the respondent regarding deletion of contents from the official laptop, which he attempted at the time of enquiry. -6-
NC: 2025:KHC:34328 RFA No. 604 of 2023 HC-KAR Ex.P.16 (Skype Chat dated 03.05.2016) reveals that the respondent along with his colleagues were actively engaged in working with the competing company. The Trial Court erred in holding that it was merely a 'plan', whereas the contents of chat at Ex.P.16 are prima facie incriminating. It is further submitted that Ex.D.5 (appointment agreement), at Clause No.13 clearly provides that in the event of breach of confidentiality obligations, the employer is entitled to initiate disciplinary proceedings and terminate services forthwith. The initiation of disciplinary proceedings and termination at Ex.P.2 are thus in consonance with contractual terms. It is submitted that Ex.D.6 is the enquiry report, the misconduct of the respondent was discovered when the laptop of the Ex-Director, Matti Prasad was recovered, and therefore, the termination was neither arbitrary nor illegal.
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NC: 2025:KHC:34328 RFA No. 604 of 2023 HC-KAR Respondent's submission:
8. Respondent-plaintiff contends that the respondent was wrongly terminated on 04.06.2018 without notice, enquiry or charge sheet. The termination letter contained grave and stigmatic allegation:
i. Breach of confidentiality; ii. Theft of intellectual property and iii. Criminal breach.
The Trial Court after full trial has rightly held that the termination is arbitrary, unjustified and violative of natural justice and awarded Rs.10.00 lakhs. It is submitted that Ex.P.16 does not contain any direct act of misconduct by the plaintiff, it is at best a plan or allegation. The termination at Ex.P.2 rests only on a prima facie assumption which is unacceptable. Careful perusal of Ex.P.2 shows only a prima facie, hence not proven. That the Trial Court rightly granted stigma free relieving letter and damages which warrants no interference by this Court.-8-
NC: 2025:KHC:34328 RFA No. 604 of 2023 HC-KAR
9. Having heard the learned counsel on both sides, the point that arises for determination is :
"Whether the termination of the plaintiff under Ex.P.2 was arbitrary, unjustified or stigmatic and whether the awarding of Rs.10.00 lakhs including Rs.5.00 lakhs as damages was justified?"
Shorn from necessary details, the facts of the present case are :
10. The plaintiff was employed by the defendant- company from 01.04.2010, and had executed a confidentiality and non-solicitation agreement. On 04.06.2018, following internal review, his services were terminated under Ex.P.2. The termination order alleged breach of confidentiality and misconduct. The appellant- defendant relied upon Ex.P.16, a memorandum prepared on basis of internal investigation of skype chats recovered from the laptop of an Ex-Director, one Matti Prasad Rao. The memorandum narrates communications between Matti and former and present employees of the company, referring to development of competing product 'Isage' -9- NC: 2025:KHC:34328 RFA No. 604 of 2023 HC-KAR under Amalgam RX. The chats identified several employees, including the respondent, as members of the team extending support while still in employment with Welldoc (appellant-defendant). The plaintiff challenged the termination as stigmatic and violative of natural justice, sought a stigma free relieving letter, settlement of benefits and damages. The Trial Court decreed the suit, awarded Rs.10.00 lakhs and held termination arbitrary and stigmatic.
11. Ex.P.16 is a memorandum of investigation referring to skype chats between Matti (Ex-Director). The document records that Gen Process Software Code was shared, that Amalgam RX was developing 'Isage' and that a list of old team members including 'Raghav, Srini, Vivek, Pushkar, Ghanshyam, Ashok and Keerthi' were named as working on the competing project. This communication provide tangible contemporaneous material including breach of loyalty and confidentiality obligations. In private employment 'proven misconduct' in Clause 13 at Ex.D.5
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NC: 2025:KHC:34328 RFA No. 604 of 2023 HC-KAR does not require criminal conviction, it suffices that the employer, acting bonafide, relies on documentary material to conclude that the employee has engaged in misconduct. Ex.P.16, supported by the conduct attributed to the plaintiff during the 04.06.2018 interaction (refusal to cooperate and attempted eraser of files) constituted sufficient basis for the appellant to invoke Clause 13. Clause 13 of Ex.D.5 reads as under:
"13. Term and Termination. Employment of the Employee under this Agreement is at-will and may be terminated by either party at any time, with or without notice or cause by either party by giving thirty (30) days written notice or wages in lieu thereof. Such requirement of notice or wages in lieu thereof shall not be applicable in the event that the employment of the Employee is terminated on the grounds of proven misconduct. The obligations and restrictions imposed upon the Employee under Sections 4, 5, 6, 9, 11 and 12 of this Agreement shall remain in full force and effect, and shall be enforceable against the Employee regardless of whether the termination of the Employee's employment is voluntary or involuntary or is with or without notice and/or cause and shall survive the termination of the Employee's employment with the Company."
[ Emphasis supplied]
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NC: 2025:KHC:34328 RFA No. 604 of 2023 HC-KAR
12. Accordingly, the termination cannot be branded arbitrary or wholly unjustified. It was contract referral under Ex.D.5. However, the employer did not conduct a formal domestic enquiry with charge-sheet and opportunity to defend. The absence of enquiry renders the termination procedurally defective and the language of Ex.P.2 stigmatic in form and substantively valid under Clause 13 of Ex.D.5. To mitigate prejudice to the employee's future employability, the Trial Court was justified in directing issuance of a stigma free relieving letter.
13. The Trial Court awarded Rs.10.00 lakhs splitting as Rs.5.00 lakhs towards contractual dues, leave settlement, etc., and Rs.5.00 lakhs stigma damages. While the plaintiff's claim for contractual dues having remained unpaid, the award of Rs.5.00 lakhs is justified, however, Rs.5.00 lakhs as stigma damages is unsustainable and the Trial Court has erroneously penalized the employer for alleged high handedness which is highly unjustified. In
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NC: 2025:KHC:34328 RFA No. 604 of 2023 HC-KAR conclusion, this Court holds that the termination was contract-referable and cannot be terminated arbitrary or unjustified and accordingly, the point framed for considered is answered and this Court pass the following:
ORDER i. Regular First Appeal is hereby allowed.
ii. The judgment and decree dated 25.08.2022 in
O.S. No.6666/2019 passed by the XII
Additional City Civil and Sessions Judge,
Bengaluru (CCH-27) is hereby modified. iii. The finding that the termination was arbitrary is hereby set aside. Termination is held to be valid under Clause 13 of Ex.D.5, but procedurally defective for want of enquiry. iv. The direction to issue a relieving letter without stigma is affirmed.
v. The award of Rs.5.00 lakhs towards damages is set aside.
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NC: 2025:KHC:34328 RFA No. 604 of 2023 HC-KAR vi. The respondent shall be entitled for contractual dues with interest @ 10% p.a. from the date they fell due until realization.
Sd/-
________________________ JUSTICE K.S. HEMALEKHA MBM List No.: 1 Sl No.: 10