Karnataka High Court
Trilogy E-Business Software India (P) ... vs Kaustubha S Gudi on 7 March, 2024
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 7TH DAY OF MARCH, 2024
BEFORE
THE HON'BLE MRS. JUSTICE K.S. HEMALEKHA
WRIT PETITION No.42874/2019 (L-TER)
C/W
WRIT PETITION No.20306/2022 (L-RES)
IN W.P. No.42874/2019
BETWEEN:
SRI KAUSTUBHA GUDI
AGED 35 YEARS,
S/O. SRI SUDNYANENDRA S. GUDI
R/AT NO.F-8, 1ST FLOOR,
NARAYAN RESIDENCY
MALMADDI 6TH CROSS,
DHARWAD - 580 007. ... PETITIONER
(BY SRI NAIK V.S., ADVOCATE)
AND:
1. THE MANAGEMENT OF
M/S. TRILOGY E-BUSINESS SOFTWARE INDIA (P) LTD.,
LALITHA NILAYA, NO.1/2, 4TH CROSS,
RMV II STAGE, BHOOPASANDRA,
BENGALURU - 560 094
REP. BY THE CHAIRMAN AND
CHIEF EXECUTIVE OFFICER,
e-mail: [email protected];
[email protected];
2. THE TECHNICAL CUSTOMER SUPPORT MANAGER,
(ALONG WITH THE MANAGEMENT TEAM AND
REPRESENTED BY CHIEF EXECUTIVE OFFICER)
M/S. VERSATA ENTERPRISES INC.
401, CONGRESS AVE, SUITE 2650,
AUSTIN, TEXAS - 78701, USA
e-mail: [email protected];
[email protected];
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3. THE TECHNICAL CUSTOMER SUPPORT MANAGER,
(ALONG WITH THE MANAGEMENT TEAM AND
REPRESENTED BY CHIEF EXECUTIVE OFFICER)
M/S. IGNITE TECHNOLOGIES
401, CONGREEE AVE,
SUITE 2650, AUSTIN,
TEXAS - 78701, USA
e-mail: [email protected];
[email protected];
[email protected] ... RESPONDENTS
(BY SRI V. SRINIVAS RAGHAVAN, SENIOR ADVOCATE A/W
SRI P. CHINNAPPA, ADVOCATE FOR R-1;
SRI DHYAN CHINNAPPA, SENIOR ADVOCATE A/W
SRI S. NARASIMHAN, ADVOCATE FOR R-2 AND R-3)
THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND 227
OF THE CONSTITUTION OF INDIA, PRAYING TO CALL FOR ENTIRE
RECORDS FROM THE PRINCIPAL LABOUR COURT, BENGALURU
PERTAINING TO ANNEXURE-D; QUASH THE AWARD DATED 18.08.2018
PASSED BY THE PRINCIPAL LABOUR COURT, BENGALURU IN
I.D.NO.20/2017 THE CERTIFIED COPY OF WHICH IS PRODUCED AND
MARKED AS ANNEXURE-D TO THE EXTENT THE PETITIONER IS
AGGRIVED, SINCE THE LABOUR COURT HAS COMMITTED ERRORS
WHICH ARE APPARENT ON THE FACE OF THE RECORDS AND ETC.
IN W.P. No.20306/2022
BETWEEN:
1. M/S. VERSATA ENTERPRISES, INC.
A COMPANY INCORPORATED UNDER
THE LAWS OF USA, HAVING OFFICE AT:
401, CONGRESS AVE,
SUITE 2650, AUSTIN,
TEXAS - 78701,
UNITED STATES OF AMERICA
REPRESENTED BY ITS
AUTHORISED REPRESENTATIVE,
MR. PHILLIP GABRIEL YOCCA BACHMAN.
2. M/S. IGNITE ENTERPRISE
SOFTWARE SOLUTIONS, INC.
A COMPANY INCORPORATED UNDER
-3-
THE LAWS OF USA, HAVING OFFICE AT
401, CONGRESS AVE,
SUITE 2650, AUSTIN,
TEXAS - 78701,
UNITED STATES OF AMERICA
REPRESENTED BY ITS
AUTHORISED REPRESENTATIVE,
MR. PHILIP GABRIEL YOCCA BACHMAN. ... PETITIONERS
(BY SRI DHYAN CHINNAPPA, SENIOR ADVOCATE A/W
SRI NARASIMHAN S., ADVOCATE)
AND:
1. SRI KAUSTUBHA S. GUDI
AGED ABOUT 37 YEARS,
S/O. SRI SUDNAYENDRA S. GUDI,
NO.F-8, 1ST FLOOR,
NARAYAN RESIDENCY,
MALMADDI 6TH CROSS,
DHARWAD - 580007.
2. M/S. TRILOGY E-BUSINESS
SOFTWARE INDIA PRIVATE LIMITED
A COMPANY INCORPORATED UNDER
THE PROVISIONS OF THE
COMPANIES ACT, 1956
HAVING ITS REGISTERED OFFICE AT
LALITHA NILAYA, NO.1/2, 4TH CROSS,
RMV II STAGE, BHOOPASANDRA,
BENGALURU - 560094. ... RESPONDENTS
(BY SRI V.S. NAIK, ADVOCATE FOR R-1;
SRI V. SRINIVAS RAGHAVAN, SENIOR ADVOCATE A/W
SRI P. CHINNAPPA, ADVOCATE FOR R-2)
THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND 227
OF THE CONSTITUTION OF INDIA, PRAYING TO SET ASIDE THE
IMPUGNED AWARD DATED 18.08.2018 AT ANNEXURE-A PASSED BY
THE HON'BLE PRINCIPAL LABOUR COURT, BENGALURU IN
I.D.NO.20/2017 AND ETC.
THESE WRIT PETITIONS HAVING BEEN HEARD AND RESERVED
ON 22/02/2024 FOR ORDERS AND COMING FOR PRONOUNCEMENT OF
ORDER THIS DAY, THE COURT PRONOUNCED THE FOLLOWING:
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ORDER
The present writ petitions were connected with W.P.
No.49970/2018, this Court heard all the writ petitions together,
however, since in W.P. No.49970/2018 preferred by Trilogy E-
Business Software India Private Limited, the relationship of
employer and employee was in dispute, hence, a separate
order has been passed in regard to the said writ petition, in the
instant writ petitions as the issue involved are interlinked, they
are taken up together for disposal.
2. W.P. No.20306/2022 is preferred by M/s. Versata
Enterprises Inc. and M/s. Ignite Enterprises Software Solutions
Inc. a company incorporated under the Laws of USA assailing
the impugned order dated 18.08.2018 with the following
prayers:
"(a) Issue a writ, order of direction in the nature of certiorari
setting aside the impugned award dated 18.08.2018 at
Annexure - A passed by the Hon'ble Principal Labour Court,
Bengaluru in ID No.20/2017.
(b) Grant any other reliefs as this Hon'ble High Court may deem
fit in the interest of justice and equity."
3. W.P. No.42874/2019 is preferred by the workman
insofar as denial of backwages by the Labour Court.
4. Heard Sri Dhyan Chinnappa, learned senior
counsel for the petitioner-management and Sri V.S. Naik,
learned counsel for the respondent-workman.
5. The question that falls for consideration before
this Court is:
"Whether proper procedure is followed by the Labour
Court in issuing the summons / notice to a person
residing / company in a foreign country, which is a
party to the Hague Convention?"
6. Learned senior counsel appearing for the petitioner
reiterating the various contentions raised in the writ petition
would mainly urge that the petitioners being entities based in
United States of America is not served in accordance with
Hague Convention or by any postal channels or in a manner
consistent with the requirements of law and thus, the order
placing the petitioners ex parte vide order dated 05.08.2017
was not justified. Learned senior counsel for the petitioner
would submit that the petitioners were unable to participate
in the proceedings due to the non-service of notice as per
the procedure contemplated in Hague Convention and the
impugned order passed by the Labour Court on the said
count alone needs to be set aside.
7. Per contra, learned counsel appearing for the
respondent-workman would justify the order to the extent of
reinstatement and other benefits and would contend that the
impugned order passed by the Labour Court is on
consideration of the entire material on record placed by
respondent No.1, however, would contend that having
reinstated the workman, he was entitled for backwages.
Learned counsel for respondent No.1 would submit that the
grievance of the petitioners that they were not served with
the notice is unsustainable for the reason that the
independent contractor services agreement envisages that
for a notice, it must be delivered in writing including the
electronic communication and thus, the issuance of notice by
e-mail to the petitioners by the Labour Court was justified
and the petitioners cannot now contend that there was no
valid service.
8. Without adverting to the merits and demerits of
the case, as stated supra, this Court has to look into whether
there was proper service of notice on the petitioners. It is
undisputed that the petitioners are entities incorporated and
operating in the United States of America, who had engaged
the freelance services of respondent No.1 for a project
outside India, perusal of the order sheet indicates that the
Labour Court issued summons through e-mail to the
petitioners and through RPAD to respondent No.2 (M/s.
Irilogy E-Business) vide Order dated 29.05.2017. The
Labour Court on 05.08.2017, held as under:
"Second Party Nos.2 and 3 absent
Notice to E-mail sent s/p No.2 and 3 are placed ex-
parte"
9. The Labour Court did not observe that the
summons were properly addressed and duly sent, but passed
an order as stated supra. The Hague Convention applies to
the present proceedings as it requires service of notice in a
particular manner as prescribed in the convention and the
Hague convention requires a specific procedure for service of
notice of judicial proceedings. India being signatory to Hague
Convention is bound by the requirements of the convention and
in terms of Hague Convention, a Central Authority is designated
by each Convention society, a request has to be necessarily
forwarded to such Central Authority, which Central Authority
shall cause it to be served in the country where service is to be
effected. It is also permissible to call for service through
diplomatic channels and the relevant countries agreed
bilaterally to serve notices to any other pers on. The fact
remains that other than postal channels, even it is assumed
that it is permissible, service of e-mail is not permissible, of
course a different matter if a party voluntarily appears before
the Court and accepts notice. The purpose of serving notice
is not just sending, there has to be a proof of receipt, even
if one assumes, at best, that there was sending of notice, there
is no evidence of receipt of notice, unless there is sufficient
proof of receipt of e-mail, a Court cannot hold service
sufficient.
10. The Kerala High Court in Mollykutty vs. Nicey
Jacob and others1 (Mollykutty) was a circumstance where
the summons to defendant No.1 whose address was at USA
by way of registered post, returned unclaimed and defendant
No.1 was placed ex-parte. Even in the said circumstances,
the Kerala High Court held that such summons was not
justified and held that whenever service of notice/summons
to the defendants residing in a foreign country comes for
consideration, it is incumbent upon the Courts below to
ascertain whether the country is a party to the Hague
Convention and held that the summons was not sent in
adherence to the rules of procedure of the Hague Convention
and it was sent directly to the appellant by registered post
and arrived at a conclusion that the summons was not duly
sent and there was no circumstance to declare deemed
2018 SCC Online Kerala 20657
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service also. The Kerala High Court at paragraph Nos.13 to
16 held as under:
"13. It is to be borne in mind that India
acceded to the Hague Convention on 23.11.2006 and
the convention was entered into in force in India on
1.8.2007. Thereafter, the Ministry of Law and Justice
is the nodal ministry for the service of
summons/notices and other judicial process in civil
and commercial matters served on persons residing in
foreign country, which is a party to the Hague
Convention. Similarly Ministry of Home Affairs, New
Delhi is the Nodal Ministry for the service of
summons/notices and other judicial process in criminal
matters (OM No.D1B21216/2009 dt:26.07.2010 of the
High Court of Kerala). The Ministry of Law and Justice
issued instructions to the High Court insisting strict
adherence to the guidelines formulated by the Ministry
of Law and Justice, pursuant to the Hague Convention,
1965. The High Court of Kerala had insisted strict
adherence to the said guidelines through O.M.
Nos.D1(B)-17109/2005 dtd:08.04.2005, D1(B)-
52483/2006 dtd:07.08.2006, D1(B)-26378/2006
dtd:05.06.2006, D1(B)-180/2007 dtd:11.01.2007,
D1(B)-75265/2008 dtd:26.12.2008, D1B-21216/2009
dtd:12.05.2009, D1B-33789/2010 dtd:23.06.2010,
D1B-21216/2009 dtd:01.07.2010, D1B-21216/2009
dtd:26.07.2010, & D3-92033/2014 dtd:12.03.2015
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sent to the subordinate courts. The High Court of
Kerala directed the subordinate courts to follow the
said guidelines in serving summons/notices to the
persons residing in foreign country, which is a party to
the Hague convention. OM No.D1B33789/2010 dated
23.06.2010 issued by the High Court of Kerala to the
Subordinate Courts reads thus:
"In the circumstances, as sought by the
Government of India, all Subordinate Courts in
the State are informed that it is an obligation of
the Judicial Courts in the Country to follow the
mandates of the Convention, as India has
become a signatory to the Convention, the
stipulations of which have come into force for
the Country w.e.f. 29th August, 2007."
14. More importantly, for serving
notices/summons on persons residing in USA, there is
a specific guideline as per the mutual legal agreement
of treaty between India and USA and the High Court of
Kerala directed all the subordinate courts to follow the
said procedure for serving summons/notices to the
persons residing in USA by OM dated 01.07.2010
issued by the High Court of Kerala. In the case of
USA, summons/notices for service in USA are to be
sent directly by the courts to 'process forwarding
international,' the central authority appointed by USA
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and they, in turn, serve them to the addressee
concerned.
15. In view of the various OM's referred to
above, we find that summons/notices could be served
to the persons residing in USA, in strict adherence to
the procedure prescribed in the said OM. The
summons/notices could not be sent directly to the
persons residing in foreign country, after the adoption
of the said method of transmission formulated,
pursuant to the Hague Convention. Since the OM's are
various in number, we have directed the Registry of
this court to formulate and submit a codified general
Rules of procedure to be followed in sending
notices/summons and other Judicial documents in civil
and commercial matters to persons residing in foreign
country, which is a party to the Hague Convention. In
compliance with the said direction, the Registry
formulated a general procedure and submitted before
us for serving summons/notices and Judicial
documents to persons residing in foreign country. The
said general procedure reads thus:
General procedure to be followed for service
of notice in civil and commercial matters, on
persons residing abroad
i) The Ministry of Law and Justice is the nodal
Ministry for the service of notices and other
judicial processes in civil and commercial
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matters to be served on persons residing
abroad. Therefore, requests for service of
Notices and other Judicial processes in Civil
and Commercial matters to be served on
parties residing abroad are to be forwarded
with a covering letter from the Court
concerned to the Joint Secretary of Legal
Affairs, Ministry of Law and Justice,
Department of Legal Affairs, Shastri Bhawan,
New Delhi.
ii) The request needs to be sent in the prescribed
'Request Form' under the Hague Convention of
1965 along with the 'Warning' and 'Summary
of the Documents to be served', all in
duplicate. (Copies of the Hague Convention on
the Service Abroad of Judicial and Extrajudicial
Documents in Civil or Commercial Matters,
1965, the prescribed 'Request Form', 'Warning'
and 'Summary of the Documents to be served'
along with instructions for filling them up
enclosed - details available at www.hcch.net)
iii) Notice/Summons in original (containing the
seal of the court) and copy of the petition, in
duplicate, have to be submitted, providing
more than 4 months time, for effecting service
in foreign countries.
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iv) The complete name and full address of the
party is to be furnished. (P.O. Box Number and
Passport Number will not suffice as the address
of the individual)
v) The complete address of the issuing authority
to which the service report is to be returned
has to be furnished.
vi) Translation of the documents in the official
language of the country where the notice is
proposed to be served, wherever necessary
(viz. in the case of Non-English speaking
Countries like China, Arabian Countries etc.)
have to be furnished.
vii) Notice/summons for service in USA are to be
sent directly by the Courts to Process
Forwarding International, 633 Yesler Way,
Seattle, WA 98104, USA along with the
required fee etc. (details available at
www.hcch.net), as the Central Authority, USA
has authorized the said agency to receive
summons/notices under the Hague Convention
of 1965. Details regarding the same are
available in link pertaining to USA in the
'Central and other Authorities' link in the
'Service' section in the home page of the
website www.hcch.net.
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viii) The Central Authorities in Canada and Australia
charge a fee for the process of service under
the Hague Convention of Service Abroad of
Judicial and Extra-Judicial Matters, 1965. Fee
may also be charged by other countries for the
process of service as above. Details regarding
the fees, if any, and the mode of payment are
available in the link pertaining to the
respective country in the 'Central and other
Authorities' link in the 'Service' section in the
home page of the website www.hcch.net.
ix) The Department of Legal Affairs processes the
service of summons/notices in civil and
commercial matters issued by an Indian Court
for service on a person residing in a foreign
country with which there is a reciprocal
arrangement. The list of member State/non-
member State and the details regarding the
Central Authority & practical information
relating to member States to the Hague
Convention on the Service Abroad of Judicial
and Extrajudicial Documents in Civil or
Commercial Matters, 1965 are available in the
Service Section of the website "www.hcch.net".
(x) In addition to the general procedure outlined
above, different countries may have different
requirements and specific procedures (which
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may be subject to updation over a period of
time) which have to be complied with for
service of summons/notices to persons
residing in such countries and the same have
to be ascertained from the link pertaining to
the respective country in the 'Central and other
Authorities' link in the 'Service' section in the
home page of the website 'www.hcch.net'.
16. Going by the said guidelines, we find that
after the formation and adoption of the specific
method of transmission, for service of
notice/summons in civil and commercial matters, by
India, pursuant to the Hague convention 1965, no
notice/summons could be sent directly to the persons
residing in a foreign country, which is a party to the
Hague Convention. If summons or notice was sent
directly to the person residing in a foreign country,
which is a party to the Hague Convention, it cannot be
said that the summons was properly addressed and
duly sent. No declaration of deemed service also could
be made, where the acknowledgement has not been
received back."
11. Placing reliance on the judgment of the Kerala
High Court, the Bench of High Court of Delhi at New Delhi in
Microsoft Corporation and Another Vs. Tech Heracles
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OPC Private Limited and others2 (Tech Heracles), took a
similar view regarding the procedures to be followed in
effecting the service on defendants situated outside India,
when the country is part of Hague Convention. The Mumbai
High Court held in similar lines in case of Ms. Anupama
Sharma Vs. Vikram Kamal Jagtiani3(Anupama Sharma).
12. The Hague Convention placed by the petitioner
was a convention on service of abroad, Article 2 of the Hague
Convention reads as under:
"Each Contracting State shall designate a Central
Authority which will undertake to receive requests for
service coming from other Contracting States and to
proceed in conformity with the provisions of Articles 3
to 6.
Each State shall organise the Central Authority in
conformity with its own law."
13. Articles 2 to 10 of the Hague Convention
stipulates that there is a recognized Designated Central
Authority, which is assigned the task to receive the request
CS(COMM) 276/2021 D.D. 18.02.2022
W.P.Nos.6345/2017 c/w 6349/2017 D.D. 27.03.2018
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for service from other contracting States and to proceed in
conformity with the provisions of Articles 3 to 6, Article 5 of
the Hague Convention stipulates the procedure in which the
documents are required to be served and on tendering the
proof thereof, it would be considered a valid service of
judicial and extra judicial document in any civil or
commercial matters.
14. Article 10 provides the state of destination does
not object, the present convention deals with the freedom to
send judicial documents by postal channels, directly to
persons abroad, meaning the service of summons through
direct postal service is acceptable. However, in any manner
or at no stretch of imagination, it would justify compelling
the party to appear before the Court and accept the
summons. The Hague Convention having prescribed
mechanism to serve summons at Article 15, which reads as
under:
"Where a writ of summons or an equivalent document
had to be transmitted abroad for the purpose of
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service, under the provisions of the present
Convention, and the defendant has not appeared,
judgment shall not be given until it is established
that-
a) the document was served by a method
prescribed by the internal law of the State addressed
for the service of documents in domestic actions upon
persons who are within its territory, or
b) the document was actually delivered to the
defendant or to his residence by another method
provided for by this Convention,
and that in either of these cases the service or the
delivery was effected in sufficient time to enable the
defendant to defend.
Each Contracting State shall be free to declare that
the judge, notwithstanding the provisions of the first
paragraph of this Article, may give judgment even if
no certificate of service or delivery has been received,
if all the following conditions are fulfilled -
a) the document was transmitted by one of the
methods provided for in this Convention,
b) a period of time of not less than six months,
considered adequate by the judge in the particular
case, has elapsed since the date of the transmission of
the document,
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c) no certificate of any kind has been received,
even though every reasonable effort has been made to
obtain it through the competent authorities of the
State addressed.
Notwithstanding the provisions of the preceding
paragraphs the judge may order, in case of urgency,
any provisional or protective measures."
15. In that contingency procedure has to be strictly
followed. After the Hague Convention entered into force in
India, the Ministry of Law and Justice in the Nodal Ministry
for service of summons/notices and other judicial process in
civil and commercial matters served on persons residing in
foreign countries, which is part of the Hague Convention,
issued instructions insisting strict adherence to the guidelines
formulated by the Ministry of Law and Justice and the
Kerala High Court has directed the subordinate Courts to
follow the guidelines issued by the Ministry of Home Affairs,
New Delhi, in the Nodal Ministry for service of
summons/notices and other judicial processes in criminal
matters. Thus, from the Hague Convention and the decision
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in Mollykutty, it is to state here that where an opposite
party residing in a foreign country comes for consideration, it
is incumbent upon the Courts below to ascertain whether the
country is a part of the Hague Convention and if yes, the
method of service to be as per Article 15 of the Hague
Convention.
16. The fact remains in this matter that the service of
notice is not done in accordance with law and such notice
through e-mail was not justified. The Labour Court
significantly erred in sending the notice by e-mail and
thereupon placing the petitioner ex parte is contrary to the
Hague Convention. The placing of exparte of the petitioners
and the impugned order of the Labour Court warrants
interference and the point framed for consideration is
answered accordingly. For the foregoing reasons, this Court
pass the following:
ORDER
i. W.P. No.20306/2022 is allowed and W.P.
No.42874/2019 is disposed of.
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ii. The order of the Labour Court is set aside, the
matter is remitted back to the Labour Court for
fresh consideration in accordance with law.
iii. Parties to appear before the Labour Court on
27/03/2024 without waiting for further notice,
the Labour Court to pass appropriate orders after
affording sufficient and reasonable opportunities
to both the parties.
iv. All the contentions of the parties are kept open to
be urged before the Labour Court.
v. This Court has not considered the matter on
merits and any reference on the merits of the
matter would be limited to the extent of
considering the present petition.
SD/-
JUDGE
MBM
