Dinesh Divekar
Business Mentor, Consultant And Trainer
Freelancer In Hr &indirect Taxes For
Insolvency N Gst Professional
Marketing Manager

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Hi I used to work for a company which did not provide me any joining letter nor experience letter and even the salary was given to me in cash that too very low considering I am am MBA. After 6 months they gave me a 100rs bond paper stating it as contract and compulsory to sing it if i have to retain the job. I signed it forcefully as it was my 1st job, but had to quit the job due to frustration later after completing one year, they refused to provide me any relieving of experience certificate.
Now i have established a business similar to their one and they have threaten me for a legal prosecution on basis of that contract and their lawyer is asking me to pay 30 lacks as compensation. What should i do?

From India, Mumbai

Dear Swapnil,
Refer the links below.
No one can force you to stop your business even if it same as your previous employer.
Manupatra Articles
Non Compete Clauses and The Indian Contract Act, 1972

From India, Delhi
Dear Swapnil,
You have written that "After 6 months they gave me a 100rs bond paper stating it as contract and compulsory to sing it if i have to retain the job". We need to know the contents of the bond. Secondly, roughly what are the main contents of the lawyer's notice?
Dinesh Divekar

From India, Bangalore
""their lawyer is asking me to pay 30 lacks as compensation. What should i do?""
First thing seek appropriate legal advice from a local lawyer.
As learned member above has questioned-what is the wording of the contract?
What type of business have you started?
No one can stop you from starting a competing business,only you cannot use your previous employer data as a base.
There are posts in this forum regarding similar problems use search button to get an idea.
Contract Act protects you to some extent while giving duties to obey contract signed of free will.
Your lawyer will see all aspects of the case all papers and give you right advice.

From India, Pune
@swapnil,You are a qualified person,hope you might have read the contents of the bond.Also you may be aware of any other documents you have signed.First of all no one can force you to sign any such document which you dont want to.secondly it is business and you can be challenged,but be assured that if you have not signed any such document which can be put in as evidence against you,you need not to fear.Advice hire good lawyer and seek advice.
From India, Vadodara
Thank you for your references:
The main clause of that agreement that i violated according to their lawyer was as:

1) "In the event employee leaving the service of the company in breach of agreement and he shall not serve in any capacity whatsoever or be associated with any person,firm or company carrying on such business for the reminder of the said period(3 Years) and in addition pay to the company as liquidated damages an amount equal to the salary of the employee would have received during the period of sixty months as calculated based on last drawn salary and shall further reimburse to the company any amount that the company may have spent on training."

2) They are thinking that i have joined hands with their competitors and informing their secrets and approaching their client. Where as the truth is I have established my company on my own and all my clients are earned by me through marketing activities. and my products/models are different from theirs.

3) They are stating that they have occurred heavy loses and asked me to pay 60 months salary as per my last drawn salary. And asked to pay the same within 7 days on failing which they will move to court. This letter was received on September 2015 and no updates after that.

I consulted my lawyer and he states me that I need not to worry of this notice and suggested me to file case on them for threatening me to pay above amount and stopping me to take the carrier of my choice.

I am a startup, and don't want any hassles right at the start of my business carrier. So iam just waiting to complete 3 years. I left that company in October 2013. This post was just to get the clearer picture on shall I wait or go on to build my business..

From India, Mumbai
As a fresher no one wanted to leave the job after 6 months as it would affect further progress badly.
And I had two options: either to sign or to quit the job.
@nathrao: Mine is a electronic trading company. My previous company is a manufacturer and trader of similar components. Mine models are different from theirs completely.

From India, Mumbai
What products was company dealing with in electronic trading and what are you planning to deal with-give details?
You are legally entitled to start your own business.Other than divulging your previous employers secrets,trade marks etc the concept of free business applies.
Carry on with your job and build up business.
Take your lawyers advice and if needed a second opinion of another lawyer.
This is classic way of keeping ex employees under pressure.

From India, Pune
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