1. Plaintiff in O.S.No. 277 of 1985 before the Munsiff's Court, Parur is challenging in this Second Appeal the dismissal of his suit and the appeal filed against such dismissal before the Sub Court, Parur as A.S.No.156 of 1987. The sole defendant in the suit, namely, the Fertilizers and Chemicals Travancore Ltd. is the respondent in the appeal.

2. The relevant facts are not in dispute and can briefly be stated thus: Plaintiff was selected by the defendant as a management trainee as per Ext.A1 letter dated 15-11-1979. At the time of joining the service of the defendant as a management trainee, plaintiff executed Ext.A2 bond dated 1-12-1979 undertaking to undergo training for two years and thereafter to serve the company for five years. Clause (3) of Ext.A2 bond provided that if the plaintiff fails or neglects or refuses to complete the training period and to serve the company for five years, he should pay to the company liquidated damages of Rs.10,000/-. At the time when the plaintiff executed Ext.A2 bond, Ext.A5 circular issued by the Central Government was in force. The said circular was to the effect that enforcement of bonds executed by the employees of a public enterprise at the