Delhi District Court
M/S. Holostick India Ltd vs Present Address on 19 April, 2010
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IN THE COURT OF SHRI SURINDER S. RATHI:ADJ:
ROOM NO.32:TIS HAZARI COURTS :DELHI
CS NO: 260/05
M/s. HOLOSTICK INDIA LTD.
50,ADHCHINI
SRI AUROBINDO MARG
NEW DELHI110017 ...................(PLAINTIFF)
VERSUS
PRESENT ADDRESS :
SHRI BABLU PRASAD GUPTA
S/o SHRI MATHURA PRASAD GUPTA
C10, NEW KONDLI
NEW DELHI110096
PERMANENT ADDRESS:
SHRI BABLU PRASAD GUPTA
S/o SHRI MATHURA PRASAD GUPTA
GOVT. HOSPITRAL BY BEHIND
P.S. OBRA
DISTT, AURANGABAD (BIHAR) ......DEFENDANT
SUIT FOR RECOVERY OF RS.4,27,000/
DATE OF INSTITUTION : 01.11.2004
DATE OF ARGUMENTS : 19.04.2010
DATE OF JUDGMENT : 19.04.2010
JUDGMENT
1. This suit for recovery of Rs. 4.27 Lacs apart from cost and interest @ 24% g.contd/...
2p.a. has been filed by plaintiff company against its defendant/ ex employee.
2. Case of the plaintiff, as per plaint, is that it is a duly incorporated company under Companies Act and is engaged in the business of manufacturing Holograms for various private and Government undertakings. Defendant was appointed by plaintiff as a Lab Assistant vide an appointment letter dated 30.11.98 w.e.f. 01.12.98. Subsequently w.e.f. 01.08.2001 defendant was promoted as shift incharge (Production) by the plaintiff.
3. It is case of the plaintiff company that the hologram which is manufactured by them is used to prevent duplication and counterfeiting of products/papers etc. and as such leaking of information qua preparation of such holograms to any unauthorised person can adversely effect their clients. When the plaintiff inducted the defendant into service, defendant was made to furnish a bond as per which he was to serve the plaintiff company for minimum period of three years and he would be faithful in discharging the duties. As per the bond defendant agreed that he would not take up similar job or start similar business after leaving the company in next three years and would not pass any information qua the plaintiff company's affairs to any outsiders. In case of violation of the Bond, defendant was supposed to compensate the plaintiff company by paying Rs. 75,000/.It is further case of the plaintiff that in violation of the above bond defendant joined a competitor company within g.contd/...
3three years of leaving job with plaintiff. For this act of defendant plaintiff company claims that it is entitled to be compensated by paying Rs. 2 lacs. It is further case of the plaintiff that they had spent substantial amount on the training of defendant and impart technical know how and secret formulation of manufacturing holograms under qualified foreign trade seniors in the field of scratching, hot stamping of foils, coating and chemical coatings etc. As per them defendant resigned from his job on 12.05.04 even though his resignation was not accepted by the plaintiff. Defendant left the plaintiff company without handing over any charge, keys and secret documents like drawings that pertaining to manufacturing of holograms. He also did not give any account of material and chemicals issued to him by 07.05.04 to 11.05.04.
4. It is also pleaded that respondent had taken personal loan of Rs. 15,000/ from plaintiff out of which Rs. 12,000/ stood unpaid on the day he left the job. Plaintiff had sent three telegrams to the defendant but no response was received. It was followed by issuance of legal notice which was replied by the defendant on 25.06.04 where he denied the allegations. Defendant requested for adjustment of Rs. 12,000/ as unpaid loans with his funds lying with the plaintiff. This was followed by issuance of plaintiff letter dated 22.07.2004 which was replied by defendant on 19.08.04. As such plaintiff has come up with suit for Rs. 4.27 lacs which includes claim under various heads g.contd/...
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HEADS Rs.
• Towards destroying samples of Holograms Rs. 1,70,000/
• Towards destroying chemicals Rs. 45,000/
• Balance outstanding against loan amount Rs. 12,000/
• Compensation for violation of agreement Rs. 2,00,000/
dated 30.09.1999 ____________________________________
TOTAL Rs. 4,27,000/
5. Upon service of summons of this suit defendant contested the same by filing detailed Written Statement. In his WS he has prayed for dismissal of this suit on the pleas of lack of cause of action and concealment of facts. On merits he accepted that he was appointed by plaintiff company on 30.11.1998 as Lab Assistant but as per him no agreement/bond as pleaded was executed at that time. As per him after serving the plaintiff for few months plaintiff forced certain employees including him to sign the bond/agreement. Since defendant was in dire need of job and was not in a position to bargain, he was constrained to sign since he was threatened that in case he do not do so he would be made to resign. It is further case of the defendant that as per bond he was supposed to serve for a minimum period of three years w.e.f. 30.07.99 to 30.07.02 and as he served the plaintiff upto 12.05.04. , there was no violation. As per him no formal or informal training was ever imparted to him and that he was given service by plaintiff as per his past industrial experience. Defendant has pleaded that he has not joined any competitor g.contd/...
5engaged in similar business as alleged. He has termed this clause to be violative to Section 27 of the Contract Act, 1872 being a negative covenant. He has also taken a plea that suit has not been signed, verified by authorised person and that the alleged bond is not sufficient to stamped.
6. On merits defendant has contended that plaintiff's claim of suit amount is misconceive . As per him whatever material and chemical were issued to him between 07.05.04 to 11.05.04 were consumed in the manufacturing Holograms. As far as plaintiff claim of Rs. 12,000/qua personal loan is concerned it is said that it is rather the defendant who received huge amount of money from plaintiff for full and final settlement while living the job and that this claim can be adjusted from his dues. Defendant denied disclosing of any confidential information to any outsider or business rival of plaintiff.
7. Separate replication to this WS filed wherein plaintiff reiterated its pleaded case and denied the averments of the defendant contained in WS.
8. Upon conclusion of pleading following issues are framed by Ld. Predecessor on13.04.05.
ISSUES :
9.
1. Whether Plaintiff is entitled to a decree for a sum of Rs. 4.27 lacs with interest @ 24% pendent lite and future ? OPP
2. Relief.
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10. To prove its case plaintiff examined PW1 Sh. R. Venugopal, their Manager HR, PW2 Sh. S.K. Aggarwal, their Deputy Manager (Production) and PW3 Sh. Mahesh Kumar their Security Supervisor . On the contrary Defendant Sh. Bablu examined himself as DW1.
11.I have heard arguments of Ld. Counsels for plaintiff Sh. Somnath Chakarvarti, Advocate with Ld. Counsel Sh. Rajesh Kumar Advocate however none turned up on behalf of defendants despite repeated calls and I have perused the case file carefully.
12.In his deposition as PW1 Sh. R. Venugopal Manager (HR) , of plaintiff company has deposed on the lines of plaint in his affidavit as Ex. PW 1/A . He has exhibited on record Application Form as Ex. PW 1/1, Appointment Letter dated 30.11.1998 as Ex. PW 1 / 2, Confirmation Letter dated 01.06.1999 as Ex. PW 1/3, Promotion Letter dated 31.08.01 as Shift Incharge (Production) as Ex. PW 1/ 4, Copy of Bond dated 13.07.1999 executed between defendant and plaintiff company as Ex. PW 1/5, Copy of resignation letter dated 12.05.04 as Ex. PW 1/6, copies of purchase and sale bills of chemicals and payment advice as Ex. PW 1/6A (colly), Copy of telegrams as Ex. PW 1/7, Copy of Legal Notice dated 01.06.04 as Ex. PW 1/8, Copy of reply of legal notice dated 25.06.04 as Ex. PW 1/9, Copy of letter dated 22.07.04 as g.contd/...
7Ex. PW 1/10 & Copy of letter dated 19.08.04 as Ex. PW 1/11.
13.He was cross examined at length wherein he conceded that plaintiff has not filled its certificate of incorporation. He also conceded that they have not placed any document on record to show that he is authorised to depose on behalf of plaintiff company. He also accepted that he has not brought the Minutes Book qua the resolution purportedly authorising Sh. Rajesh Sharma to file and sign this suit. Even though he claims that signing of the bond by each and every employee at the time of initial appointment is a regular practice but he conceded that he has not signed any such bond while serving with plaintiff. He said that he was not asked to do so because he was one of the Director of a sister concern of plaintiff's company. He accepted that he has no document to show that defendant did not join a competitor company. As per him he was not aware of any mis conduct on the part of defendant while he was serving with the plaintiff. He has also accepted that the documents qua the training of defendant have not been placed on record. He was unaware if the service record of the defendant was also placed on record or that defendant took a personal loan from the plaintiff company. As per him he has placed certain photocopies of the record to show that defendant was supplied certain goods and security supervisor told him about destruction of some goods by the defendant. He conceded that no police complaint was lodged qua this . He accepted that all the material purchased by the plaintiff g.contd/...
8company was insured against fire and damages and no such claim has been alleged by plaintiff company qua claimed destruction.
14. PW2 Sh. S.K. Aggarwal deposed on the lines of plaint in his affidavit as Ex. PW 2/A. He is Deputy Manager (Production). On 11.05.06 he found some finished products were burning in the incinator machine relating to Tamil Nadu Excise Department. The Incinator Operator told him that the materials are being burnt on the asking of defendant but the defendant had left the place by that time. He has submitted a report made by him qua this incident dated 12.05.04 as Ex. PW 2/1 to Manager Administration of plaintiff. He accepted that no attendance sheet has been placed on record to show that he had attended the duty on 11.05.04. As per him defendant was not working under him. The incinator operator one Mr. Ramesh was performing duty there. Even though his duty hours are from 9:30 AM to 6:00 PM while on that day he was at the office upto 7:15 PM to 7:30 PM when he saw the incident of burning of material. He accepted that once some material is put into incinator it cannot be ascertained as to qua which client it pertained to . He accepted that he was asked to give written report about the incident by Sh. Venugopal even though he was not its immediate boss. He accepted that he did not see defendant personally nor he contacted him.
15. PW3 Mahesh Kumar Security Supervisor also deposed on the lines of g.contd/...
9plaint in his affidavit as Ex. PW 3/A. He said that on 11.05.04 he was on duty at 7:40 PM he found some 6065 Kg usable material was lying in Incinator Machine. He enquired from the defendant about it and defendant told that it have destroyed under his instructions. He has proved on record copy of information as Ex. PW 3/1. In his detailed cross examination he accepted that there is not attendance sheet on record to show that he attended the office on 11.05.04. He also accepted that there is nothing on record to show that he was serving with the plaintiff company on part of M/s. Group 4 Securities. He also accepted that even though proper attendance sheet and entry exit register were maintained but nothing has been placed on record to show that defendant entered factory at what time and left at what time on that day. He also accepted that there is nothing on record to show if either PW1 or PW2 were in factory on 11.05.04. He further accepted that since his security supervisor he is not in a position in ascertaining as to what material lying in factory as usable and what material is no usable. As per him he knows that as to what is good or bad material. As per him the material which was lying near the gate of incinatory machine was 5/6 Kg in weight where as he has mentioned it to be 5060 Kg in chief. He accepted that in his complaint Ex. PW 3/1 he has not mentioned the time of incident.
16. In his deposition as DW1 Defendant Bablu Prasad Gupta deposed on the lines of WS. He was cross examined at length wherein he stated that he is g.contd/...
10working with M/s. Flex Industries at Noida, U.P. He denied the suggestion of the defendant that M/s. Flex Industries are in the same business as the plaintiff has and is one of their competitor. He denied that he violated the terms and conditions of agreement in any manner. He accepted that his service dues were not settled till the time he resigned from the service of the plaintiff. He denied that the plaintiff spend any money on his training. He accepted that he did not comply clause 14 of his appointment letter qua issuance of one month notice for tendering resignation.
17.Now I shall dispose of individual issues framed in this suit.
18. ISSUE NO.1: Whether Plaintiff is entitled to a decree for a sum of Rs. 4.27 lacs with interest @ 24% pendent lite and future ? OPP
19.As far as the claim amount of Rs.4.27 lac is concerned, as per para 12 of the plaint, it has been claimed under four different heads. I shall deal with each head individually.
st
20. 1 Head : Towards destroying samples of Holograms worth Rs. 1,70,000/.
21.It is alleged against the defendant that he ordered for destruction of sample g.contd/...
11Holograms of 6065 kgs in the incinator through Sh. Ramesh Kumar. In this regard it is evident from the plaint that there is no mention of figure of 6065 kgs or as to what was the value of this material per kg. There is important contradiction with regards to the plea of defendant in the deposition of PW2 in so far as in the affidavit in chief the weight of the material was referred to 60 65 kgs while in his cross examination he mentioned it to be of 56 kgs. Moreover, it is admitted by the witnesses examined by the plaintiff that there is nothing on record to show that the defendant attended the office on 11.5.2004. Neither of the three witnesses examined by the plaintiff , personally witnessed defendant directing the incinator attendant Sh. Ramesh Kumar to destroy the holograms samples. All that they stated is that Incinator attendant Sh. Ramesh Kumar told them that he is destroying the hologram samples on the asking of defendant. As such deposition of these PWs in this regard has no evidentiary value being hearsay evidence. Incinator attendant Sh. Ramesh Kumar was not produced as witness and there is no explanation whatsoever for his non examination and as such adverse inference is liable to be drawn against the plaintiff company U/s 114 (g) of the Evidence Act to the effect that either no such incident ever took place and that had they produced Sh. Ramesh , he would not have supported the plaintiff company. Hence in view of this discussion, plaintiff is not entitled to any recovery under this Head.
nd
22. 2 Head : Towards destroying chemicals worth Rs.45,000/ g.contd/...
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23.Under this head , it is plea of the plaintiff that defendant was supplied chemical for use in the manufacturing of holograms within the period 7.5.2004 to 11.5.2004. Admittedly during this period , defendant was serving the plaintiff company as Shift Incharge (Production). It is categorical case of the defendant that whatever was supplied to him , stood consumed during that period. There is nothing on record to show as to which chemical of what quantity was at all supplied to defendant and as to what was its value. It is admitted case of the plaintiff that their manufacturing unit was a totally secured place in so far as , they have hired services of M/s Group 4 Securities Ltd. and no employee was allowed to take any chemical or material out of the unit. In this scenario the plea of the plaintiff that defendant destroyed or did not give any account of chemical worth Rs.45,000/ has remained totally unsubstantiated .
rd
24. 3 Head Balance outstanding of Rs. 12,000/ against loan
25.As far as this claim is concerned, it is admitted by the defendant he owns this money to the plaintiff company. He has claimed that after he left the job of the plaintiff, he was supposed to be paid huge amount of money by the plaintiff and that the plaintiff's claim of Rs.12,000/ can be adjusted from it. Neither the plaintiff produced any account sheet or similar other documents g.contd/...
13to show that defendant does not deserve to be paid any amount by them nor defendant produced any document in support of his plea that he is entitled to receive huge amount of money from the plaintiff. All that remains is an admission on the part of defendant that he owes Rs.12,000/ to plaintiff out of a loan of Rs.15,000/ taken by him. Hence plaintiff company is entitled to this amount.
26.4th Head Compensation of Rs. 2,00,000/ for violation of agreement dated 30.09.1999
27.In this regard it is contended by the plaintiff that under the agreement , defendant was debarred from serving any competitor concern of the plaintiff for three years after leaving the job with them. There is nothing on record to show that M/s Flex Industries Ltd. , subsequent employer of the defendant is in any manner a competitor concern of the plaintiff. In the absence of any evidence in this regard , this plea has remained unsubstantiated. Moreover, since this clause contains a negative covenant , it is not only violative of Article 19 of the Constitution but is also violative of Section 27 of the Contract Act . It is case of the defendant that he was an Industrially trained person even before he joined the services of the plaintiff and such a worker can not be legally debarred from taking up a job in field in which he is skilled. Moreover, the penalty clause of the service contracts provides for 75000/ g.contd/...
14compensation as against Rs.2 lacs claim. There is nothing on record to show if the plaintiff company incurred financial expenditure on the training of the defendant. Moreover, when defendant resigned only after the serving the plaintiff company for much more than period of 3 years, there is no question of burdening him with any penalty. As such plaintiff company is not entitled to any claim under this head.
28.With these observations, it is concluded that out of the suit claim of Rs.4,27 rd lacs, plaintiff is entitled to recovery of only Rs.12,000/ under 3 head. However as far as claim interest @24% per annum is concerned, there is nothing on record to show that plaintiff is entitled to interest @ 24%. As far as balance loan amount of Rs.12,000/ is concerned, plaintiff has not placed on record any loan agreement containing the interest clause. Hence in my considered view plaintiff company is entitled to only 12% interest on this amount during the pendency of this suit and till its recovery.
29.Relief.
30.In view of the decision on above all issues, suit of the plaintiff is decreed for sum of Rs.12,000/ with interest @12% pendentilite till the date of realisation g.contd/...
15and with cost equivalent to court fee leviable on Rs.12,000/. Decree sheet be prepared accordingly and file be consigned to RR.
ANNOUNCED AND DICTATED IN OPEN COURT N 20.4.2010 (SURINDER S. RATHI) ADDL. DISTRICT JUDGE DELHI g.contd/...
16MONEY DECREE SECTION 34 OF THE CODE OF CIVIL PROCEDURE IN THE COURT OF SHRI SURINDER S. RATHI, ADJ-07/CENTRAL/ DELHI.
CS NO: 260/05 M/s. HOLOSTICK INDIA LTD.
51, ADHCHINI SRI AUROBINDO MARG NEW DELHI-110017 ...................(PLAINTIFF) VERSUS PRESENT ADDRESS :
SHRI BABLU PRASAD GUPTA S/o SHRI MATHURA PRASAD GUPTA C-10, NEW KONDLI NEW DELHI-110096 PERMANENT ADDRESS:
SHRI BABLU PRASAD GUPTA S/o SHRI MATHURA PRASAD GUPTA GOVT. HOSPITRAL BY BEHIND P.S. OBRA DISTT, AURANGABAD (BIHAR) ......DEFENDANT SUIT FOR RECOVERY OF RS.4,27,000/-
DATE OF INSTITUTION : 01.11.2004 DATE OF ARGUMENTS : 19.04.2010 DATE OF JUDGMENT : 19.04.2010
The Suit coming for final disposal before me in the presence of Sh. Somnath Chakarvarti, Advocate with Ld. Counsel Sh. Rajesh Kumar Advocate for plaintiff . It is ordered suit of the plaintiff is decreed for sum of Rs.12,000/- with interest @12% pendentilite till the date of realisation and with cost equivalent to court fee leviable on Rs.12,000/-.
g.contd/...
17 Costs of the suits Plaintiff Defendant Stamp for plaint 6,550/- Stamp for power NIL Stamp for power 1.25 Stamp for exhibits NIL Stamp for exhibits Stamp for petition NIL Pleader's fee Pleader's fee NIL Subsistence for witness Subsistence for witness NIL Commissioner's fee Commissioner's fee NIL Service of process Miscellaneous NIL Miscellaneous 3 Total 6554.25 Total NIL
Given under my hand and the seal of this court, Dated 19.4.2010.
SEAL ADDL. DISTRICT JUDGE
CENTRAL-07,DELHI
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CS NO: 260/05
M/s. HOLOSTICK INDIA LTD.
VERSUS
SHRI BABLU PRASAD GUPTA
19.4.2010
Pr: Ld. Counsel Sh. Somnath Chakarvarti and Sh. Rajesh Kumar advocate for
plaintiff
None for defendant
Despite several calls none appeared on behalf of defendat.
FA heard and case file is perused carefully.
Vide a separate judgment of the day suit of the plaintiff is decreed for sum of Rs.12,000/- with interest @12% pendentilite till the date of realisation and with cost equivalent to court fee leviable on Rs.12,000/-. Decree sheet be prepared accordingly and file be consigned to record room.
(SURINDER S. RATHI) ADDL. DISTRICT JUDGE DELHI 19.4.2010 g.contd/...