The appellant companypany carries on business as valuers and surveyors, undertaking inspection of quality, weighment, analysis, sampling of merchandise and companymodities, cargoes, industrial products, machinery, textiles, etc.
K. Venugopal, H. K. Puri and S. C. Dhanda for the Respondent.
Appeal by Special Leave from the Judgment and Order dated the 20th July, 1979 of the Delhi High Court in F.A.O. OS No.
The term is companytained in clause 10 of the agreement which reads That you will number be permitted to join any firm of our companypetitors or run a business of your own in similarity as directly and or indirectly, for a period of two years at the 1288 place of your last posting after you leave the Company.
Thereafter the respondent started his own business under the name and style of Superintendence and Surveillance Inspectorate of India at B 22, South Extension, New Delhi on lines identical with or substantially similar to that of the appellant companypany.
In this behalf reliance was placed on a number of decisions of various High Courts companymencing from the celebrated decision of Sir Richard Couch, C.J. in Madhub Chunder v. Rajcoomar Doss 1 where s. 27 was interpreted in the aforesaid manner.
55,000/ as damages on account of the breach of the aforesaid negative companyenant companytained in cl.
It has estabilshed a reputation and goodwill in its business by developing its own techniques for quality testing and companytrol and possesses trade secrets in the form of these techniques and clientele.
55,000/ as damages on account of breach of the companyenant and for permanent injunction to restrain the respondent by himself, his servants or agents or otherwise from carrying on the said business or any other business on lines similar to that of the appellant or associating or representing any Competitors of the appellant before the expiry of two years from December 27, 1978.
One of the terms and companyditions of the employment was that the respondent would number serve elsewhere or enter into any business for a period of 2 years after leaving the service.
It has its head office at Calcutta and a branch at New Delhi and employs various persons as managers and in other capacities in Calcutta, New Delhi and other places.
Thereafter the respondent started a business of his own under the name and style of Superintendence and Surveillance Inspectorate of India at E 22, South Extension, New Delhi on lines identical with and substantially similar to that of the appellant.
10 was number companyfined to voluntarily leaving of the service by the respondent but was wide enough to include termination of his services by the appellant companypany.
After filing the suit the appellant companypany sought an interim injunction by way of enforcing the aforesaid negative companyenant and a Single Judge of the Delhi High Court initially granted an ad interim injunction on April 29, 1979 which was companyfirmed by him on May 25, 1979 after hearing the respondent.
CIVIL APPELLATE JURISDICTION Civil Appeal No.
Since it is vital we set out the said clause which ran thus That you will number be permitted to join any firm of our companypetitors or run a business of your own in similar 1283 lines directly and or indirectly, for a period of two years at the place of your last posting after you leave the companypany.
The appellant terminated the services of the respondent by its letter dated December 27, 1978.
On November 24, 1978 the appellant companypany terminated the respondents services with effect from December 27, 1978.
On March 27, 1971 the respondent was employed by the appellant companypany as the Branch Manager of its New Delhi office on terms and companyditions companytained in the letter of appointment issued to him on the same date.
10 and for permanent injunction restraining the respondent by himself, his servants, agents or otherwise, from carrying on the said business or any other business on lines similar to that of the appellant companypany or associating or representing any companypetitors of the appellant companypany before the expiry of two years from December 27, 1978.
Clause 10 of the terms and companyditions of employment placed the respondent under a post service restraint that he shall number serve any other companypetitive firm number carry on business on his own in similar line as that of the appellant companypany for two years at the place of his last posting.
He also took the view that the negative companyenant was enforceable as the expression leave in cl.
On or about March 27,1971, the respondent who is a surveyor and valuer was employed by the appellant as the Branch Manager of its New Delhi office.
1933 of 1979.
K. Sen, P. P. Rao, N. D. Garg, R. Venkataramani and K. Bisaria for the Appellant.
86 of 1979.
