SNV Aviation Private Limited v. Capt. Gareema Kumar

9. Even though it is true that in the plaint the plaintiff has pleaded about exclusive jurisdiction but at the same time they have pleaded that cause of action has also occurred in Mumbai. The word ‘also’ suggests that cause of action has occurred some where also along with Mumbai. Whereas in the leave petition, they have quoted some of the instances to support their contention that part of cause of action has occurred in Mumbai. Both the pleadings read together are not self destructive.

CIRCUMSTANCES QUOTED BY THE PETITIONER

10. Learned Senior Advocate Mr. Dwarkadas in support of his contention relied upon the following circumstances:- (a) Employment Agreement dated 18th October 2022, and Training agreement dated 20th October 2022, were executed in Mumbai. (b) Initially, all these Defendants were under training and after completion of training, they were issued confirmation letter dated 26th June 2023, from Mumbai.

(c) Copy of email dated 30th August 2023, filed by the

(d) There is a copy of email thereby accepting the resignation dated 2nd September 2023. It was in Mumbai. (e) The advance undated cheques issued by the Defendants on their bank account (in which the amount of salary is credited) and they are payable at Mumbai. (f) The jurisdiction clause in both these agreements gives jurisdiction to this Court mutually.

11. For easy reference all the facts pleaded in suit filed against Captain Gareema Kumar are referred. More or less they are similar in other matters, except in place of their posting.

CIRCUMSTANCES QUOTED BY THE RESPONDENT

12. By way of reply learned Senior Advocate Mr.Khambata invited my attention to the following circumstances: (a) Copy of email sent by the Plaintiff to Defendant- Gareema Kumar thereby informing the Defendant about instructions to be followed while submitting the Pilot Employment Agreement, Training Agreement, PF forms, final offer and four undated cheques. Though, copy of this email is not annexed to the plaint, it is annexed to the Interim Application prepared by the Defendant thereby opposing the interim reliefs. (b) That reply in Interim Application is not filed with the Court probably for the reason that yet this Court has not granted leave. The reply is served on other side. Learned Senior Advocate Mr. Khambata tendered across the bar a copy of this email referred in (a) above.

(c) On the basis of email, it is submitted that both these agreements are not executed, in Mumbai but the Defendant has signed them at his/her place of posting.

(d) Sending confirmation letter from Mumbai is not the part of cause of action.

(e) Sending resignation email is from Delhi and just because the Plaintiff has received it in Mumbai, cannot be considered as part of cause of action. (f) The undated cheques issued by the Defendants were not deposited by the Plaintiff and on the basis of available record, it cannot be said that they are payable at Mumbai. Hence, it is submitted that the Plaintiff may deposit these cheques at any place in India wherein the Plaintiff is having bank account.

13. On the basis of above averments, it needs to be seen the law on this aspect. For deciding the cause of action there are following parameters:-

(i) Which is the place of execution of the agreement.

(ii) Which is the place of performance of the agreement.

(iii) Which is the place where the breach has taken place.

PLACE OF EXECUTION OF AGREEMENT

14. It is true that there is dispute in between the parties, which is place of execution of all these agreements. During arguments, learned Senior Advocate Mr. Dwarkadas invited my attention to the instructions given in the undated email. It was sent on behalf of the Plaintiff to the Defendant-Gareema Kumar. It is true that there are several instructions given to the respondent including execution of the documents and other compliances. He submitted that there is nothing on record produced on behalf of the Defendant that all these agreements are signed by them outside Mumbai. Hence, he wants to raise the issue that this is the grey area and for that purpose leave should not be refused. To buttress his submissions, he relied upon the observations in case of: (a) Aegis Logistics Ltd. vs Shreeji Liquid Storage Terminal Pvt. Ltd. reported in 2021 SCC Online Bom. 4823 and (b) M/s. New Bharat Engineering Works vs.The Oil and Natural Gas Commissioner reported in 1998 SCC Online Bom. 21. It is true that in case of Aegis Logistics Limited (supra) the leave was refused by learned Single Judge and it was granted by the Division Bench. While granting the leave, the Division Bench considered the factors:

(i) Execution of Memorandum of Understanding at

(ii) Two part payments received in Mumbai.

15. Whereas in case of M/s. New Bharat Engineering Works (supra) as referred above, there was Petition for revocation of the leave which was already granted. It was not allowed. While rejecting the request for revocation, this Court has considered certain factors and one of the factor was about payment of handling charges made in Bombay. In that case, there was dispute about place of execution of the agreement. According to the Plaintiff it was at Bombay, whereas according to the Defendant, it was at Madras. Even the plea was raised that how witness could have signed the agreement, who are posted at Madras, how they can come to Bombay for signing as the witnesses. However, after hearing both sides, this Court opined that this is the grey area.

16. Learned Senior Advocate Mr. Dwarkadas also relied upon the observations in case of A.B.C. Laminart Pvt. Ltd. vs. A.P. Agencies reported in (1989) 2 Supreme Court Cases 163. He invited my attention to the observations in para 12 and 15. He emphasized on the observations that:-- “in cases of repudiation of a contract, the place where information of repudiation is received is the place where the suit would lie”.

17. It is true that in para 12 the Hon’ble Supreme Court has dealt with various factors to be considered while deciding which can be cause of action. It is observed thus:-- “it must include some act done by the Defendant since in the absence of such an act no cause of action can possibly accrue. It is not limited to actual infringement of right sued on but includes all the material facts on which it is founded”. It is true that in case of M/s New Bharat referred above, while dealing with request for revocation of leave, there was grey area about which was the exact place of execution and hence this Court has left that decision to be taken after evidence will be recorded and this Court has preferred to go through the averments in the plaint. We are faced with a very peculiar situation. That is to say respondents are challenging the claim of petitioner about execution in Mumbai and also relied upon email sent by the petitioner. We are at the stage of grant of leave but having an opposition on behalf of the respondent. They are not relying upon any documents from their side. That is to say, sending email, forwarding the agreement and other douments signed by them. But at the same time, there is an email sent by the petitioner themselves instructing to comply some acts including signing the agreement. So in this peculiar situation, I think it is better to postpone giving any decision in either way and left it to be decided at subsequent stage. I am saying so because I am impressed by another circumstance of taking decision on the resignation at Mumbai.

PLACE OF PERFORMANCE AND OF RESIGNATION

18. There is one more circumstance about issuing confirmation letter from Mumbai. I feel this circumstance cannot be considered. It is for the reason that the suit is filed for declaration that the Defendant has breached both the agreements and it is filed for claiming damages from Defendants. So, I do not think that issuance of confirmation letter even though part of the transaction can be considered as one of the factor while determining the cause of action.

19. Learned Senior Advocate Mr. Khambata relied upon the following judgments:-

(i) Hakam Singh vs. M/s. Gammon (India) Ltd.,

(ii) Bhagwandas Goverdhandas Kedia vs. Girdharilal

(iii) Kotak Mahindra Finance Ltd. vs. T. Thomas

20. In case of Bhagwandas Kedia (supra) the majority view was that the observations of the trial Court i.e. City Civil Court, Ahmedabad as having jurisdiction is correct. In that case the purchaser was stationed at Ahmedabad and he gave offer for purchase of cotton seed cake and supplier was stationed at Khamgaon. The supplier communicated the offer on telephone at Ahmedabad. The suit was filed at Ahmedabad. The objection was taken to the jurisdiction, however, it was turned down. The Hon’ble Supreme Court interpreted the provisions of Sections 3 and 4 of the Indian Contract Act.

21. Mr. Khambata laid emphasis on the observations. According to him, in the present matter, the Defendant has emailed his acceptance of employment and even emailed his resignation. It has come into effect. He submitted that once email is sent, it is not within his control.

PROVISIONS OF CONTRACT ACT

22. It is true that the Section 3 of the Contract Act says about communication, acceptance and revocation of proposals. Whereas Section 4 deals with when “the communication is said to be complete”. Thus this section does not talk about which place can be considered for filing the suit. Section 4 says that: (a) The communication of a proposal is complete when it comes to the knowledge of the person to whom it is made. (b) Similar, category is about communication of acceptance. It is no doubt in two parts:

(i) One it is complete against the proposer, when it is put in a course of transmission to him, so as to be out of the power of the acceptor.

(ii) However it is complete against the acceptor, when it comes to the knowledge of the proposer.

(c) The third category is communication of a revocation. It is complete against

(i) the person who revokes the offer, when it is put into a course of transmission to the person to whom it is made, so as to be out of power of the person who revokes it.

(ii) However, it is complete against the person to whom it is made, when it comes to his knowledge.

23. Learned Senior Advocate invited my attention to various observations about different modes of communication made in case of Bhagwandas Goverdhandas Kedia (supra). It is by way of post, telegraph, telephone etc. In that case, there was communication to the Plaintiff through telephone. It was considered to be complete. Ultimately, the Hon’ble Supreme Court upheld the decision of the trial Court, which has the jurisdiction.

24. Whereas in case of Hakam Singh (supra), there was issue about jurisdiction dealing with procedure under Section 20 of the Arbitration Act. For the reason that respondent carries on business at Bombay, Bombay court was having jurisdiction coupled with a clause in the agreement thereby giving jurisdiction to Bombay Court. Court at Varanasi was not having jurisdiction.

25. Whereas in case of Kotak Mahindra Finance Ltd. (supra) agreements and sanction of loan took place at Chennai. Whereas only notice of termination was issued from Mumbai. Hence, it was held that merely issuing the termination notice from Mumbai does not give jurisdiction to the Court at Mumbai.

26. By way of reply, learned Senior Advocate Mr.Dwarkadas relied upon the provisions of Section 13 of the Information Technology Act which deals with time and date of dispatch of receipt of electronic record. Whereas the learned Senior Advocate Mr. Khambata submitted that these principles are not applicable when there is dispute as per Contract Act. He also submitted that yet any of the Courts have not interpreted the provisions about place of jurisdiction, when there is communication through email. He alternatively submitted that even if we consider that acceptance of resignation is from Mumbai, it was received at Bangalore/New Delhi, hence that submission cannot be accepted.

27. It is true that Respondent has issued four cheques. However, there is no material to suggest that they are payable in Mumbai only. They are not deposited also.

28. From the above discussion, it is difficult to believe that place of performance of the contract was in Mumbai. Admittedly, training domicile or operational domicile of all the Defendants in not in Mumbai.

PLACE OF BREACH.

29. Both learned Senior Advocates have invited my attention to the resignation clause, from the Employment Agreement. There are clauses 11.4.[1] and 11.4.2. When we read these clauses, we will find that when the Pilot desires to resign from service, he shall provide with the company a minimum of six months prior written notice of such resignation. Upon such resignation being tendered, the Pilot shall continue to serve during such notice period. The company has got right to waive off notice in its entirety or in part.

30. If the Pilot decides to resign while undergoing the investigation, the company has right to refuse resignation. This is not applicable in the present case.

31. When the company has waived off all or a part of notice period, the company has right to require the Pilot to make a payment in lieu of such waived off notice period.

32. If Pilot fails to serve the company for entire notice period, the company shall have the right to recover from the Pilot, payment in lieu of the remainder of the notice period.

33. Learned Senior Advocate Mr. Dwarkadas submitted that merely because the Pilot has resigned through email form place of posting, the receipt was at Mumbai. Whereas the employer has been given lot of discretion to take appropriate decision.

34. My attention is also invited to resignation through email dated 30th August 2023. It mentions that the resignation will be in effect from 1st September 2023 and the Pilot will not be available for flight duties. Whereas the reply dated 2nd September 2023, given by the Plaintiff through email mentions that the Pilot has to report to his duties and last working day will be 29th February 2024.

35. Learned Senior Advocate Mr.Khambata submitted that in fact the Plaintiff has accepted the resignation subject to fulfillment of certain terms.

36. On one legal aspect Mr. Khambata submitted that there is difference in between repudiation of the contract and termination by way of resignation. He relied upon the provisions of Section 39 of the Indian Contract Act. It is true that if one of the party expressly or impliedly repudiates, the contract and in that case rival party has got right to either accept repudiation or reject it. According to him it is not case of repudiation. He made his submission to defend contention that “the place where repudiation is received is material for determining the jurisdiction” as observed in para 15 of the judgment in case of ABC Laminart Pvt. Ltd. referred above. The relevant portion is:-

37. It is true that as stated above, sending confirmation letter is from a place outside Mumbai. However, I am inclined to consider the place where the resignation through email was received can certainly be considered as one of the factor for deciding the cause of action within jurisdiction of the Court. It is for the reason that sending resignation through email cannot be sufficient. Ultimately, it is the company who has to take decision, either the company may refuse to accept the resignation or may accept it conditionally or may accept it for future date. If these options are available to the employer/Plaintiff and these option can be exercised only when the resignation through email is received, certainly part of cause of action has taken within the jurisdiction of this Court because Section 4 of the Indian Contract Act which deals with revocation of communication earlier against person to whom it is made, when it comes to his knowledge. In this case it is Plaintiff.

38. Even though it may be true that the respondent got knowledge of acceptance outside mumbai, the decision was taken in Mumbai. At this stage I am not going into issue whether the resignation is repudiation, termination or cancellation. That can be gone into later on. Hence, for these reasons part of cause of action has accrued in Mumbai.

JURISDICTION CLAUSE

39. It is true that there is jurisdiction clause in both the agreements. However it is settled law that you cannot bestow a jurisdiction on a court which otherwise will not be having jurisdiction. The parties have agreed to bestow jurisdiction on Mumbai Courts. In addition to this, as part of cause of action (about acceptance of resignation) has taken in Mumbai, I have already observed in favour of the petitioner. Hence, the following order is passed: ORDER

(i) Leave Petitions are allowed in terms of prayer clause (a) and are disposed of. [S. M. MODAK, J.]