IN THE HIGH COURT OF JUDICATURE AT MADRAS

DATED : 26.04.2011

CORAM

THE HON'BLE MRS. JUSTICE R.BANUMATHI

and

THE HON'BLE MR. JUSTICE V.PERIYA KARUPPIAH

O.S.A.NO.413 OF 2008

ISG Novasoft Technologies Limited,

rep. By its Chief Executive Officer,

Krishnakumar Srinivasan

G3, Ground Floor,

Elnet Software City, TS 140, Block No.2&9,

Rajive Gandhi Salai,

Taramani, Chennai-113.

...

Appellant

vs.

Gayatri Balasamy

...

Respondent

Original Side Appeal is filed under Order XXXVI Rule 1 of the

Original Side Rules read with Clause 15 of the Letters Patent against

the order dated 14.11.2008 made in A.No.1793 of 2008 by this Court.

For Appellant

: Mr.S.K.Chandrakumar

For Respondent : Mr.G.Ravikumar for

M/s.HLC Associates

JUDGMENT

R.BANUMATHI,J

This appeal arises out of the order dated 14.11.2008 in

A.No.1793 of 2008 whereby the learned single Judge directed the

Appellant to give bank guarantee for the sum offered as a settlement

to the tune of Rs.74,94,564/- out of Rs.1,13,53,680/- less applicable

taxes.

2. Appellant company-ISG Novasoft Technologies Limited is

engaged in the business of dealing with various products relating to

Information Technology. Respondent-Gayatri Balasamy joined the

Appellant company on 10.03.1996. Appellant company and Respondent

entered into an agreement which came into force on 27.04.2006.

Respondent was appointed as Appellant Company's Vice President for

Mergers and Acquisition on a salary of Rs.54 lakhs per month. Before

https://hcservices.ecourts.gov.in/hcservices/

taking up the assignment, Respondent has entered into an application

for employment. Respondent has been working in the Appellant

company. In the month of December 2007, Appellant company decided to

terminate the services of the Respondent. By the letter dated

20.12.2007, Appellant company terminated the services of the

Respondent. A cheque for Rs.14,85,225/- was sent towards salary for

four months, net of taxes, in lieu of notice was sent to the

Respondent.

3. Alleging that Chief Executive Officer of the Appellant

company viz., Krishnakumar Srinivasan was misbehaving with her,

Respondent is said to have lodged criminal complaints (i) Crime

No.824/2007 of R4-Pondy Bazaar Police Station; (ii) Crime No.172/2008

of Cyber Crime Central Crime Branch; (iii) Private complaint before

XVII Metropolitan Magistrate, Chennai.

4. According to Respondent, she is entitled to 120 days notice

in writing to show cause as to her termination if it was intended by

the Appellant company. Further case of Respondent is that she is

entitled to increase of salary, emoluments and perks in terms of

Employment agreement and she is also entitled for bonus after

completion of the first year. In terms of Article 8, all dispute

and differences, claims or proceedings between the parties relating

to the validity, construction or performance of the employment

agreement shall be referred to the sole Arbitrator and the

proceedings shall be governed by the provisions of the Arbitration

and Conciliation Act, 1996. Respondent has also filed Petition in

O.P.No.251 of 2008 under Section 11(6) of the Arbitration and

Conciliation Act for appointment of an Arbitrator. In the mean

while, Respondent has also filed application under Order XIV, Rule 8

of O.S. Rules read with Sec.9(e) of the Arbitration and Conciliation

Act directing the Respondent to remit the sum of Rs.1,71,68,000/- as

an interim measure pending disposal of the Arbitration proceedings.

5. Appellant company resisted the application contending that

the very entry of the Respondent under the employment agreement is

with fraud, since the Respondent had concealed her employment with

one M/s.Covansys India Private Limited as Senior Business Analyst and

for the irregularities committed by her. Appellant alleges that

Respondent had misrepresented the facts at the tim