IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE S.S.SATHEESACHANDRAN TUESDAY, THE 29TH JUNE 2010 / 8TH ASHADHA 1932 SA.No. 39 of 1997(D) -------------------- AS.58/1994 of ADDL.SUB COURT,PARAVUR OS.713/1990 of MUNSIFF COURT, PERUMBAVOOR .................... APPELLANT(S)/APPELLANTS/DEFENDANTS: -------------- 1.S.KRISHNANKUTTY,S/O.SANKARAN EZHUTHACHAN, PALAKKAL HOUSE, NEDUVAKKAD, KANADI, PALAKKAD. 2.S.PARAMESWARAN, PALAKKAD HOUSE, NEDUVAKKAD, KANADI, PALAKKAD. BY ADV. SRI.P.R.VENKATESH RESPONDENT(S)/RESPONDENT/PLAINTIFF: --------------- M/S.TRAVANCORE RAYONS LTD., RAYONPURAM, PERUMBAVOOR, REP. BY DIRECTOR. ADV. SRI.A.M.SHAFFIQUE, SENIOR ADVOCATE THIS SECOND APPEAL HAVING BEEN FINALLY HEARD ON 29/06/2010, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: ORDER IN C.M.P.NO.75 OF 1997 IN S.A.NO.39 OF 1997 DISMISSED. 29.6.2010 SD/- S.S.SATHEESACHANDRAN, JUDGE /TRUE COPY/ P.A. TO JUDGE S.S.SATHEESACHANDRAN, J. ---------------------------------------------- S.A.NO.39 of 1997 ---------------------------------------------- Dated this the 29th day of June, 2010. JUDGMENT Concurrent decision rendered by two courts below upholding the claim for damages by the respondent, a public sector company, against the appellants, the defendants in the suit, is challenged in the appeal. 2. The facts involved in a nut shell are this: The respondent, hereinafter referred to as the plaintiff filed the suit for a sum of Rs.10,000/- from the appellants, hereinafter referred to as the defendants, towards damages. Plaintiff had published an advertisement inviting applications from Chartered Accountants for appointment as management trainees. Pursuant thereto and after considering the application submitted by the first defendant, he was selected and S.A.NO.39 of 1997 :: 2 :: appointed as a trainee in the administrative office of the plaintiff, subject to the terms and conditions fixed for such appointment. The training period was fixed for a period of two years, providing a monthly stipend of Rs.1,500/- per month for the 1st year and Rs.1,700/- per month for the 2nd year. The appointment order, among others, mandated execution of a bond by the trainee stipulating to serve the company for a period of 5 years after undergoing the training. Admittedly, on joining service, accepting the appointment, the 1st defendant executed a bond for Rs.10,000/- with the 2nd defendant as the guarantor. After undergoing training for a period of three months, the appellant moved the application for leave for a period of three months. Simultaneously, he also sent a communication seeking for his relieving from the company. He was granted the leave applied for. After the S.A.NO.39 of 1997 :: 3 :: leave period, he did not report for duty, and on which a notice was given to him that the company will proceed to recover damages as stipulated in the bond. The first defendant sent a reply notice refuting the allegation raised that he had abandoned the job and violated the bond executed with the company. The company thereupon sued both the defendants claiming damages of Rs.10,000/-. 3. The trial court, after considering the pleadings and also the evidence let in by both sides, negatived the contentions raised by the defendants and decreed the suit allowing damages of Rs.10,000/- to the plaintiff with interest at the rate of 6% per annum and also the costs. 4. The first appellate court, after re-appreciating the evidence, concurred with the findings entered by the trial court and upheld the decree granted without any S.A.NO.39 of 1997 :: 4 :: modification. Aggrieved by the decision concurrently entered by the two courts below, the defendants have preferred this second appeal. 5. The main thrust of challenge raised in this appeal impeaching the correctness of the concurrent decision rendered by the inferior courts is that there is positive evidence proving the actual damages suffered by the company on the first defendant terminating his training course before completion of the period fixed. Another contention raised to impeach the decree is that the bond taken from the first defendant was unfair and unreasonable and so much so, it is unenforceable. To canvass that challenge, reliance is placed on the provisions of Sections 23 and 27 of the Contract Act. 6. Indisputably, the first defendant had joined as a trainee in the plaintiff S.A.NO.39 of 1997 :: 5 :: company agreeing to serve that company, after undergoing a training of two years, for a period of 5 years. The training that was imparted to him by the company was to equip him with the expertise necessary for managerial service. That being so, providing him stipend at the rate of Rs.1,500/- per month and a sum of Rs.1,700/- for the next year, he was appointed as a trainee. Naturally, when he had been selected as a trainee, pursuant to a publication, and provided with training on selection, there cannot be any doubt that the company would suffer if his services for the period agreed upon are not available. It would not be possible for the company to take a fresh trainee, without publication and completing process of selection again. There is no merit in the contention of the defendants that Ext.A2 bond taken by the company suffers from legal infirmity and it is unenforceable. When S.A.NO.39 of 1997 :: 6 :: training is provided by the company after selecting a suitable hand, there is nothing illegal in obtaining a bond from him to safeguard its interest to have his continued service in the company. The sum fixed under Ext.A2 bond, having regard to the fact that the first defendant had been selected and given training as a managerial trainee, is found to be just and reasonable. Further more, he had been provided training for a period of three months by the time he left the company. 1st defendant had received a sum of Rs.4,500/-, apart from being provided training by the company to have expertise as a managerial trainee. It has also come out from the evidence of PW.1, an officer of the company, that towards the publication made for selection a sum of Rs.4,500/- was incurred by the company. Coupled with the monetary loss, as indicated above, it has also to be taken note S.A.NO.39 of 1997 :: 7 :: that once the 1st defendant left the company during his traineeship, a fresh selection and appointment to meet the requirements of the company can be made only after a fresh selection. Taking into account all those aspects, I find that the conclusion reached by the trial court that the loss actually suffered by the company is much more than Rs.10,000/- cannot be found fault with. Taking note that the quantified damages fixed in Ext.A2 bond is Rs.10,000/-, that sum alone was awarded as damages. Though the defendants have contended that the terms and conditions of the appointment contained provision for reference of dispute between the parties to arbitration no challenge over the jurisdiction of the trial court to proceed with the trial of the suit had been pressed into service. Even assuming there was an arbitration clause, when the defendants failed to raise the lack of jurisdiction of the S.A.NO.39 of 1997 :: 8 :: civil at the appropriate stage and, further, where the suit claim is cognizable by a civil court, the contention advanced by the defendants with respect to arbitration deserves to be taken note of only for its rejection. Both the courts below have rightly and correctly repelled that contention. The damages awarded in the case was excessive was canvassed before me contending that he had left the service of the company, after a short span and, so much so, damage suffered by the company is minimal only. I cannot agree. First defendant was selected as a managerial trainee of the company. He left the company at a time when he was provided training to equip him to be taken in the managerial service of the company. When such a trainee leaves the company, more than the pecuniary loss it is likely to affect the reputation of the company as well. On the materials placed in the case, S.A.NO.39 of 1997 :: 9 :: the decree given by the trial court, as confirmed by the first appellate court, awarding the sum claimed as damages, the amount fixed in Ext.A2 bond, does not warrant any interference. Appeal is dismissed, but without any order as to costs. Sd/- (S.S.SATHEESACHANDRAN) JUDGE sk/- //true copy//