Niranjan Shankar Golikari v. Century Spinning and Manufacturing Co., 1967 SCC OnLine SC 72 made a distinction between restrictive covenants operating during subsistence of an employment contract and those operating after its termination. This view was reiterated by Justice A.P. Sen, in concurrence, in Superintendence Company (P) Ltd. v. Krishan Murgai, (1981) 2 SCC 246. It can be safely concluded, a restrictive covenant operating during subsistence of an employment contract does not put a clog on freedom of a contracting party to trade or employment. It may not be out of place to note, Justice A.P. Sen was also a Judge in Central Inland Water Transport Corporation Ltd v. Brojo Nath Ganguly, (1986) 3 SCC 156.
What is ‘just, fair and reasonable’ in eyes of society varies with time. Civilizational advancements, growth of knowledge and evolving standards of human rights and dignity alter contours of public good. Ensuring retention of efficient and experienced staff prompted Vijaya Bank to incorporate a ‘minimum service tenure’ which cannot be said to be ‘unconscionable, unfair or unreasonable’ and thereby in contravention of public policy.
– Hon’ble Justice Joymalya Bagchi, Vijaya Bank v. Prashant B. Narnaware, [Civil Appeal No. 11708 of 2016].
