- 1 - NC: 2025:KHC:8649 WP No. 10715 of 2013 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 27TH DAY OF FEBRUARY, 2025 BEFORE THE HON'BLE MR JUSTICE ANANT RAMANATH HEGDE WRIT PETITION NO. 10715 OF 2013 (L-TER) BETWEEN: M/S. IBM INDIA LIMITED, PRESTIGE TOWERS LEVEL 7, NO.99, RESIDENCY ROAD, BANGALORE-560025, NOW AT EMBASSY GOLF LINKS BLOCK A, 3RD FLOOR INTERMEDIATE RING ROAD, DOMLUR, BANGLORE-560071, REPRESENTED BY ITS DIRECTOR FINANCE THROUGH HIS POWER OF ATTORNEY HOLDER MR LAHAR APAIAAH. …PETITIONER (BY SRI JOSHUA HUDSON SAMUEL, ADVOCATE) AND: L.THOMAS SELVAN, S/O S N LAZAR, R/A NO.14/2, II FLOOR, M E G OFFICERS COLONY, BANGALORE-560033, NOW AT C/O LAWRENCE, NO.407, TRINITY ENCLAVE, OLD MADRAS ROAD, C V RAMAN NAGAR POST, BANGALORE-560093. …RESPONDENT (BY SRI A J SRINIVASAN, ADVOCATE) THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO CALL FOR THE RECORDS LEADING TO THE PASSING OF THE AWARD DATED 17.12.12 BY THE 10ST ADDL. LABOUR COURT, IN ID NO.353/06, AT ANNX-K AND ETC. THIS PETITION, COMING ON FOR REPORTING SETTLEMENT THIS DAY, ORDER WAS MADE THEREIN AS UNDER: Digitally signed by C HONNUR SAB Location: HIGH COURT OF KARNATAKA - 2 - NC: 2025:KHC:8649 WP No. 10715 of 2013 CORAM: HON'BLE MR JUSTICE ANANT RAMANATH HEGDE ORAL ORDER Heard learned counsel appearing for the petitioner as well as the learned counsel appearing for the respondent. The representative of the respondent is also present before the Court. Both the learned counsel and the parties jointly submit before the Court that the dispute between the parties is settled and accordingly, they have filed the joint memo enclosing the settlement agreement. 2. It is noticed that the joint memo is signed by the authorised representative of the petitioner-Company, and the respondent, in addition to the learned counsel for the petitioner as well as the learned counsel for the respondent. 3. Petition is filed challenging the award for reinstatement of respondent passed by the Labour Court in I.D.No.353/2006 on the file of the I Additional Labour Court at Bengaluru. 4. The terms of agreement reads as under: - 3 - NC: 2025:KHC:8649 WP No. 10715 of 2013 SETTLEMENT AGREEMENT This Settlement Agreement (“Settlement Agreement”) is executed on this 27th day of February, 2025, (“Effective Date”) by and between: (1) IBM INDIA PVT. LIMITED, a company incorporated under the Companies Act, 1956, having its registered office at Subramanya Arcade, 12, Bannerghatta Main Road, Bangalore 560 029, India, (hereinafter called "IBM India", which expression shall, unless excluded by or repugnant to the subject or context, be deemed to include its holding, subsidiary, fellow subsidiary, group, sister, associated and affiliated companies, bodies corporate and entities, and their respective successors and assigns) represented by its ______, ____ OF THE ONE PART, and (2) L. THOMAS SELVAN, C/o Lawrence, No. 407, Trinity Enclave, Old Madras Road, CV Raman Nagar Post, Bangalore- 560093 (hereinafter called "the ex-employee"), which expression shall, unless excluded by or repugnant to the subject or context, be deemed to include his heirs, executors and administrators) OF THE OTHER PART. Each of the parties may be hereinafter referred to as a “Party” or jointly referred to as the “Parties”. WHEREAS 1. The ex-employee approached the First Additional Labour Court (hereinafter referred to as “Labour Court”) at Bangalore, under Section 10(4-A) of the Industrial Disputes Act 1947, by way of I.D. No.353/2006 alleging that his services were illegally terminated by IBM India vide Termination Order dated 05.11.2001 and claimed the relief of reinstatement with back wages etc. As per the directions of the Labour Court, IBM India had paid a total sum of Rs. 14,10,000/- (Rupees Fourteen Lakhs Ten Thousand Only) for the period from January 2006 till November 2012 to the ex-employee by way of interim relief during the pendency of the dispute. 2. The Labour Court passed an award dated 17.12.2012 directing IBM India to reinstate the ex-employee into service with back wages and other consequential benefits. (“the Impugned Award”). - 4 - NC: 2025:KHC:8649 WP No. 10715 of 2013 3. IBM India thereafter filed a Writ Petition (W.P. No.10715 of 2013) before the Hon’ble High Court of Karnataka, at Bangalore challenging the aforesaid Impugned Award (“Writ Petition”) and vide interim order dated 04.03.2013, the Hon’ble High Court stayed the Impugned Award of the Labour Court, subject to payment under Section 17-B of the Industrial disputes Act, 1947. As per the directions of the Hon’ble High Court of Karnataka, in W.P. 41066 of 2014(L-PF), IBM India had paid a total sum of Rs. 70,84,487.86/- (Rupees Seventy Lakhs Eighty-four Thousand four hundred and eighty seven and Paise Eighty Six only) from January 2013 till February 2025 to the ex-employee under Section 17-B of the Industrial Disputes Act, 1947. 4. Pursuant to discussions between the Parties on various issues with respect to the disputes between them, it has been mutually agreed to resolve the matter amicably on the terms and conditions contained herein. NOW THEREFORE THIS SETTLEMENT AGREEMENT WITNESSETH: 1. The parties have agreed to settle their disputes and the ex- employee has agreed to receive a total sum of Rs. 54,00,000/- (Rupees Fifty Four Lakhs only) (hereinafter referred to as the “Settlement Amount”) in full and final settlement of all his claims/ demands in respect of his erstwhile employment with IBM. 2. The Parties undertake to take all necessary steps to place this settlement on record and take steps for closure / withdrawal of the Writ Petition within one week of execution of this Settlement Agreement and to take any other necessary steps, including signing and filing such Joint Memos, Applications/ Petitions confirming the settlement of disputes between the Parties. 3. IBM India agrees to pay the Settlement Amount after deduction of applicable taxes, in the following manner; a) Rs. 22,26,512/- after withholding tax and cess of Rs. 7,73,488/- within seven working days from the Effective Date. b) Rs. 21,07,500/- after withholding tax and cess of Rs. 2,92,500/- on or before 20.04.2025. The ex-employee intends to seek permission from the Hon’ble High Court of Karnataka to spread over the Settlement Amount - 5 - NC: 2025:KHC:8649 WP No. 10715 of 2013 from the date of his separation from IBM i.e., 05.11.2001 till the date of this settlement (Effective Date) in order to enable the ex- employee to avail relief under Section 89 of the Income-tax Act 1961 as per the Judgment of the Hon’ble Supreme Court in Sundaram Motors Vs. Ameer Jan 1985 (1) SCC 118. 4. The final payment under Section 17-B of the Industrial disputes Act, 1947 of Rs.48,955/- for the month of March 2025, will be paid as usual. There will be no further payments to the ex- employee under Section 17-B of the Industrial Disputes Act, 1947, or towards salary or any other emoluments whatsoever, relating to employment with IBM India. 5. The Parties agree that the ex-employee will be treated as having resigned from the services of IBM India on and with effect from 05.11.2001 and the ex-employee shall, for all intents and purposes, be treated as if he had resigned from the services of IBM India on 05.11.2001. 6. Upon receipt of the aforesaid Settlement Amount, the ex- employee will have no further claims whatsoever against IBM India with respect to or arising from his employment and termination, including but not limited to any illegality of termination or resignation, back wages, continuity of service, any notional or consequential benefits (including without limitation stock or equity grants or awards, pensions, superannuation, or gratuity), including his terminal benefits and waives and gives up all any claims arising out of or relating in any manner to his employment with, or separation from IBM India. On payment of the aforesaid Settlement Amount neither party will prosecute, proceed with or assert any existing or further claims they may have against each other with respect to or arising from the employment with IBM India or the subsequent termination thereof. 7. The ex-employee acknowledges and agrees that he does not have any further claims whatsoever against IBM India under any applicable labour legislations, including, without limitation, The Industrial Disputes Act, 1947, The Employees Provident Funds & Miscellaneous Provisions Act, 1952, the Minimum Wages Act, 1948, Payment of Bonus Act, 1965, Payment of Gratuity Act, 1972, Payment of Wages Act, 1936, and other applicable labour laws. The ex-employee also acknowledges and agrees that he does not have any claims against IBM India for any breach of the terms and conditions of his employment, whether express or implied. - 6 - NC: 2025:KHC:8649 WP No. 10715 of 2013 8. The ex-employee also acknowledges and agrees that he does not have any claims, whether civil or criminal, against IBM India with respect to his employment with, and termination from, IBM India. The ex-employee agrees that he shall not lodge any civil or criminal claims against IBM India or take any actions thereto (including filing of a civil lawsuit, lodging of a police complaint, or other similar actions), at any time after the execution of this Settlement Agreement. 9. In view of the terms of this settlement, the ex-employee has no objection for the Hon’ble High Court to pass appropriate Orders to set aside the Impugned Award. 10. Each party agrees not to publicize or disclose the terms and conditions of this Settlement Agreement, any documents or correspondence pertaining to this Settlement Agreement, or the underlying circumstances except with the prior written consent of the other or as required by law or as required to implement the terms of this Settlement Agreement. 11. If any provision(s) of this Settlement Agreement or the application thereof is held invalid, the invalidity shall not affect other provisions or applications of the Settlement Agreement which can be given effect without the invalid provision(s) or application and to this end, the provisions of this Settlement Agreement are declared to be severable. 12. Neither this Settlement Agreement, nor anything contained herein, nor any action taken by either party in performance of their obligations hereunder shall be construed as evidence of the validity of any claims by either party against the other or an admission of the same by either party. 13. This Settlement Agreement may not be changed or modified in any manner, orally or otherwise, except by an instrument in writing of equal formality which is signed by the Parties or their duly authorized agents. 14. In addition to the above, the Parties agree that: a) Each Party shall have the right to appropriate injunctive relief, specific performance and other remedies to enforce the provisions of this Settlement Agreement. - 7 - NC: 2025:KHC:8649 WP No. 10715 of 2013 b) If either party initiates proceedings to enforce this Settlement Agreement, and such Party prevails, the other Party will pay all costs and expenses incurred by the first Party in connection with such proceeding, including reasonable attorneys’ fees. Such proceedings shall only be initiated after the first party has requested the other party to comply with the terms of this Settlement Agreement, and the defaulting party has failed to comply with the terms of this Settlement Agreement. 15. Both the Parties hereby acknowledge that each has been provided sufficient time to review this Settlement Agreement and consult their legal advisors, and that this Agreement will be construed neither against nor in favor of either Party, but rather in accordance with its fair meaning. 16. This Agreement shall be binding upon and inure to the benefit of the Parties hereto and their respective heirs, legal representatives, successors and assigns. 17. This Agreement shall be construed as a whole according to its fair meaning and shall be governed by the laws of India. The courts at Bangalore shall have exclusive jurisdiction to adjudicate any dispute or difference between the Parties arising from this Settlement Agreement. 5. This Court has gone through the terms of settlement entered into between the parties. It is noticed that the respondent has agreed to receive Rs.54.00 lakhs towards full and final settlement of all his claims and payment schedule is also provided in the agreement. 6. After having gone through the terms and conditions of settlement, this Court does not find any impediment what- so-ever to accept the settlement. Accordingly, same is accepted. - 8 - NC: 2025:KHC:8649 WP No. 10715 of 2013 7. The impugned award is substituted in terms of settlement arrived at between the parties. 8. This Court has also perused clause No.3(b) of the agreement. The relief is sought to spread over the settlement amount from the date of separation i.e. 05.11.2020 till the date of settlement to enable to the ex-employee to claim the relief under Section 89 of the Income Tax Act, 1961 in terms of the law laid down by the Apex Court in SUNDARAM MOTORS PVT. LTD. vs AMEERJAN AND ANR. (AIR 1985 SC 144) as far as the benefit sought to be conferred on respondent in terms of clause No.3(b). 9. As far as the benefits sought in terms of aforementioned clause No.3(b) is concerned, the respondent is entitled to such benefits as applicable under the provisions of Income Tax Act, 1961. Sd/- (ANANT RAMANATH HEGDE) JUDGE BRN/List No.: 1 Sl No.: 22