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Rajasthan High Court Allows Petition Filed Under Order VII, Rule 11(D) CPC as Plaintiff’s Appointment Was Based on Contract

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Case: ICICI Prudential Life Ins. Co. Ltd. v. Pradeep Arora S/o Shri Ved Prakash Arora

Facts of the Case

Plaintiff was appointed as Agency Manager and was made permanent on the post of Agency Manager after one year. He was further promoted as Sales Manager – Rural Channel Development Grade-III. It was there in the contract that in case of termination the Respondent must provide two months’ prior notice or two months’ salary. 

Plaintiff was performing his duties as well as fulfilling all the targets for which he was given incentive also. Plaintiff was transferred from Sriganganagar to Suratgarh Branch and again transferred from Suratgarh to Sriganganagar in June 2010 due to the influence of Tarun Singh (ARM). After the plaintiff went on leave based on an oral order, he was not taken back on duty. 

The lower court rejected the plaint filed by the petitioner under Order VII, Rule 11(d) CPC where he claimed that the suit was barred under the provisions of Sections 14 & 41 of the Specific Relief Act, 1963. 

Plaintiff filed a reply to the application claiming the maintainability of the suit. The trial court concluded that at the stage of Order VII, Rule 11 CPC, the jurisdiction of the court can not be claimed and thus, rejected the application with a cost of Rs.1,000/-.

Arguments presented before the Court

Petitioner

The counsel for the Petitioner submitted that from a bare perusal of the averments made in the plaint and the relief claimed it is apparent that the plaintiff was seeking to enforce a contract of service. The enforcement of a contract of service is specifically barred under Section 14 r/w Section 41(e) of the Act. Thus, the order deserves to be quashed and set aside. The Petitioner relied on the judgment of the Hon’ble Supreme Court in Pearlite Liners (P) Ltd. v. Manorama Sirsi : (2004)3 SCC. 

Respondent

The counsel for the Respondent submitted that not all suits are barred and that the civil court has the jurisdiction to deal with the case of present nature. He further added that the rejection of the application under Order VII, Rule 11(d) CPC was justified. 

The contract of personal service is not enforceable but for the three exceptions, and thus the plaint should be dismissed.

Observation of the Court

The Court observed the decision made in the case of Axis Bank Ltd and found that in this case the Plaintiff nowhere pleaded that Plaintiff’s appointment was based on any contract. Thus, it was found that the bar under Section 14 of the Act was not applicable to consider an application under Order VII, Rule 11 CPC. However, in the present case, Plaintiff has specifically mentioned in para 3 of the plaint regarding the execution of the contract and terms of the contract. The said para mentions that the services of the plaintiff could be terminated by giving notice of two months or Salary. 

Also, the case of the Respondent-Plaintiff does not fall in any of the exceptions. The relief claimed is for enforcement of personal service and the suit is barred under the provisions of Sections 14 & 41(e) of the Act.

Court’s Decision

The Hon’ble High Court quashed and set aside the order passed by the District Judge, Sriganganagar, and allowed the application filed by the petitioner under Order VII, Rule 11(d) CPC. 

Click here to view the judgment.


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