Jurisdiction under the Delhi Shops and Establishments Act, 1954 applies to claims related to employees based on the registered office's location, even if operational activity extends outside Delhi.

JUDGMENT

Prathiba M. Singh, J. The present petition has been filed challenging the impugned order dated 27th January, 2021 passed by the Respondent No.1/Deputy Labour Commissioner (hereinafter "Authority") under The Delhi Shops and Establishments Act, 1954 (hereinafter "DSE Act, 1954") in Ref. No. SE/ED/131/2020/5964 titled Sh. Atif Ali v. M/s. Fairwood Infra & Services Pvt. Ltd. & Anr. By the impugned order, the Authority under the Act has held that, in view of the fact that the Claimant/Respondent No.3 herein was drawing his salary from the registered office of the Petitioner Company situated in Delhi, so also considering the Consultancy Agreement dated 18th May, 2018, the jurisdiction in the matter would continue with the Authority under the DSE Act, 1954.

2. The Petitioner - M/s Fairwood Infra and Services Pvt. Ltd. (hereinafter "Petitioner Company") is a company having its registered office at M-304, Dharma Apartment, Plot No.2, I.P. Extension, New Delhi-110092, and is engaged in providing architectural services. The case of Respondent No.3/Mr. Atif Ali (hereinafter "Employee") was that he was engaged to render services to the Petitioner Company as a Consultant in respect of Design and Architecture, vide Consultancy Agreement dated 18th May, 2015. Under the said Agreement, a monthly fee of Rs.48,000/- was to be paid to the Employee. He was appointed as an architect on 19th July, 2015 with the Petitioner Company. His remuneration was fixed at Rs.50,000/- per month. After serving a probationary period of three months, the Employee had secured a permanent position with the Petitioner Company. However, his grievance was that even after he was permanently appointed, the Petitioner Company did not make payments of salary as agreed upon, and kept delaying the same on one pretext or the other. On 16th December, 2020, the Respondent No.3/Mr. Atif Ali (hereinafter "Employee") filed an application under Section 2 1 of the DSE Act, 1954 with the Authority praying for payment of arrears of salary in respect of outstanding dues of Rs.25,49,148/-.

3. In response to the Employee's claim petition, the Petitioner Company took an objection of territorial jurisdiction on the ground that the establishment where the Employee was working is located in Noida, Uttar Pradesh and registered under the Uttar Pradesh Shops and Commercial Establishments Act, 1962. It was averred that the Petitioner Company may have its registered office in Delhi, but since the establishment where the Employee is working is located in Noida, the DSE Act, 1954 would not apply. It was also further argued that the case of the Employee would not be liable to be entertained by the Authority located in Delhi and the claim has to be rejected. Reliance was placed upon the judgment of this Court in Bhandari Builders Pvt. Ltd. v. M.K. Seth & Anr., [(1988) ILR 1 Delhi 64]. Before the Authority, the Employee relied upon the Governing Law and Dispute Resolution Clause of the Consultancy Agreement dated 18th May, 2015 which stipulated that any dispute arising from or in relation to the said Agreement shall be submitted to the jurisdiction of the competent courts in New Delhi. The Authority rejected the Petitioner Company's objection to territorial jurisdiction by holding that since the Consultancy Agreement provides that the jurisdiction shall rest with the competent courts in New Delhi. It is this order dated 27th January, 2021 that has been challenged before this Court.

Submissions of the Parties:

4. Mr.