B MOHANTY Vs. TATA SONS LTD

JUDGEMENT

(1.) This petition under Article 227 of Constitution of India has been filed for quashing order dated 25.2.2004 passed by civil judge Karkardooma Courts, Delhi, in suit No.113/03. Vide impugned order an application under order VII Rule 11 CPC moved by the defendant has been dismissed. CM(M) No.519/2004 Page1 of 7 I have heard Ms. S.R. Padhy, learned counsel for the petitioner and Mr. Shraman Siwha, learned counsel for respondent and have gone through the impugned order and the summoned record.

(2.) Briefly the facts are that the respondent (hereinafter referred to as the plaintiff) filed a suit for recovery of Rs.89,816/- against the petitioner (hereinafter referred to as defendant No.2) and Mr.Anand Mohanti (hereinafter referred to as defendant No.1). The plaintiff is inter alia engaged in the business of consultancy. Defendant No.1 was trainee of the plaintiff and defendant No.2 stood surety to the service agreement executed by defendant No.1. It was agreed that since the plaintiff would incur expenses on training of defendant No.1 leading to his employment with plaintiff, the defendant No.1 executed a service agreement undertaking to serve the plaintiff for a minimum period of 3 years from the date of joining and executed a bond for Rs.50,000/- for compliance of the undertaking. In the event of the breach of the agreement the defendant was to pay the bond amount plus three months salary (Rs.32,400/-) with 9% interest . The defendant No.1 allegedly resigned from his service, before completing full 3 years, in violation of the terms of the agreement and allegedly became liable CM(M) No.519/2004 Page2 of 7 to pay Rs.50,000/- plus three months salary in lieu of notice and interest thereon as agreed. Registered notice was sent to defendants to pay the sum of Rs.89,816/- alongwith 9% interest but without any fruitful result. As regards the jurisdiction it is alleged in the plaint that the terms of employment were accepted by employer no.1 in Delhi and breach of trust also took place in Delhi therefore the courts at Delhi have jurisdiction to try the suit. In the written statement and the application under Order VII Rule 11 CPC objections were raised that the court had no jurisdiction to try and entertain the suit because no cause of action arose at Delhi. Secondly, the suit was barred under the Indian Administration Act, 1940 of or any modification or re- enactment thereof, because there was an arbitration clause and reproduced clause 4 of the agreement in the written statement stating that the venue of the arbitration will be at Mumbai and that the courts at Mumbai will have the exclusive jurisdiction to the exclusion of all other courts. Factual averments were also denied.

(3.) Order sheets of the trial court show that defendant No.2 (petitioner herein) was proceeded ex parte on 22.2.2001. The defendant No.2 moved CM(M) No.519/2004 Page 3 of 7 application under Order IX Rule 7 CPC on 23.5.2001. Later on defendant No.1 was also proceeded ex parte. The said application under Order IX Rule 7 CPC was allowed subject to costs of Rs.500/- on 13.11.2001 and the defendant No.2 was given last opportunity to file written statement by next date i.e, 8.9.2003. Thereafter the defendant No.2 moved an application under Order VII Rule 11 CPC and again the defendant No.2 was directed to file written statement. Cost of Rs.200/- was imposed for not filling the written statement as directed earlier. Despite objections by defendant No.2 regarding the jurisdiction of Delhi courts, the learned civil judge noted in the order dated 31.3.2004 that since the application under Order VII Rule 11 CPC had already been dismissed which was basically on the point of jurisdiction, the defendant was to file written statement on the next date. In these facts and circumstances the written statement was filed on 25.5.2004