• Service agreement and notice period

I have resigned from my current company.In the agreement which i have signed states following clause:

"Either party may terminates this agreement by giving 3 months notice to the other party.The same notice period for termination of this agreement by the employee should neither be adjustable against privilege leave nor forfeiture of the salary of such employee and same shall be subject to discretion of company".

Now , They are asking me to pay 6 lacs Rupees as Agreement breach amount and also forcing me to serve notice period. I don't want to serve notice period.Please Reply.
Asked 4 years ago in Labour

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16 Answers

Dear Client,

Notice period is binding, if not serve than have to pay damages for breach of agreement, if such clause exits otherwise NO.

You are not bound to work against your wish but than have to comply breach clause if any.

Yogendra Singh Rajawat
Advocate, Jaipur
21481 Answers
31 Consultations

4.4 on 5.0

1) One should have resigned from company on medical ground, so if you had MBBS doctor certificate from any family member or on your name and wants to resigned from company and won't be able to serve notice period for 3 months.

Ganesh Kadam
Advocate, Pune
12338 Answers
191 Consultations

4.9 on 5.0

Whether or not the notice period can be waived off(even if you are ready to buy-out the same), has been left to the final discretion of the company.

Having said that, you do not have to pay them a penny in case you are ready to serve during the 4 months of notice period.

Their demand of Rs. 6 lacs from you is illegitimate.

Vibhanshu Srivastava
Advocate, New Delhi
9427 Answers
245 Consultations

5.0 on 5.0


If there is a clause of notice period and you have agreed for the same then you will have to abide by the same any act contrary to the same shall be treated as breach of contract.

if you do not served notice period then they might file a case of breach of contract and claim damages thereupon.


Anilesh Tewari
Advocate, New Delhi
17940 Answers
377 Consultations

5.0 on 5.0

you have breach the terms of the agreement so you are liable to pay as per law but you can request them personally .

Mohammed Mujeeb
Advocate, Hyderabad
19031 Answers
32 Consultations

4.5 on 5.0


You have resigned from the company but you have to serve the notice period and if you are not going to do it then the company can extract fine as you are honouring the agreement. Therefore you should either pay the amount or serve the notice period.


Rahul Mishra
Advocate, Lucknow
13762 Answers
65 Consultations

5.0 on 5.0

There is no question of paying Rs 6 lakhs

2) you have to give 3 months notice

3) you must serve notice period

4) it is at discretion of company to waive notice period

Ajay Sethi
Advocate, Mumbai
87976 Answers
6207 Consultations

5.0 on 5.0

You need to send them legal notice the agreement is unilateral and is against principles of natural justice send notice stating that you are ready to pay three months notice duration salary and they have no right to seek for 6 lakh as no amount is mentioned in your agreement. If they do not agree you will be forced to approach court claiming for damages from company to the damage that appear to your career. Your company can relive you after taking three months salary or ask you to serve three months make a representation to them first orally if they don't agree send legal notice through a lawyer.

Swarnarka Chowdhury
Advocate, Mysore
1878 Answers
5 Consultations

5.0 on 5.0

Sir since as per the agreement notice period is discretion of the company of you don't serve same they can file a suit against you for the damages and can proceed against you legally since there is agreement on record there is no way out of this you have to contest it in court if you leave without giving notice and serving notice period.

Shubham Jhajharia
Advocate, Ahmedabad
25516 Answers
179 Consultations

5.0 on 5.0

Firslty, as per the information mentioned in the present query, makes it clear that the wordings of the agreement are mostly combat favourable.

Secondly, but yes, there has been a presumption in he law that the agreement must not be agaisnt second party wholly.

Thirdly, they have forgot to mention that if someone can’t serve the notice period then what should be done.

Fourhtly, the agreement is not good, you should challenge it before civil court of law.

Sanjay Baniwal
Advocate, South Delhi
5464 Answers
13 Consultations

5.0 on 5.0

Dear Sir

A Legal Notice may solve your problem if your contention is correct.

Kishan Dutt Kalaskar
Advocate, Bangalore
6050 Answers
381 Consultations

4.8 on 5.0

Please have chill because they are right but this is nothing but a sort of pressure technique. First ask extension of joining date where you have selected now generally this period they may extend to two months then inform your present employer for the date of two months so in this way you cam dilute the matter otherwise as you have signed the contract/appointment letter you have to obey, so , please try to dilute the matter and not be so rigid.

Koshal Kumar Vatsa
Advocate, Gurgaon
2283 Answers
3 Consultations

5.0 on 5.0

1. The company intentionally dragging this issue, i guess. Company can not force you to serve 3 month notice period, even though there is clause on the contract to serve 3 month notice period.

2. Issue legal notice ( to both HR Manager and Reporting manager ) stating that you are ready to pay 3 month gross salary without serving notice period.

3. You may approach me for further opinion.

Advocate, Bangalore
844 Answers
9 Consultations

4.9 on 5.0

Have you sent the resignation letter in writing and have an acknowledgment for the same?

Did they give a reply in writing demanding the amount as well as the service of notice period?

No doubt there is no clause for compensation of notice period as per your post, however you may offer to serve the notice period but can refuse the payment of Rs. 6 lakhs denying any such liability or breach of agreement.

You can issue a legal notice to them seeking the desired reliefs and demand the settlement as per the clauses of termination.

After that you can plan to initiate further legal action as per law.

T Kalaiselvan
Advocate, Vellore
78133 Answers
1543 Consultations

5.0 on 5.0

You are liable to serve the requisite notice period as per agreement and it is completely at the discretion of your employer whether he wants to accept salary amount in lieu of the notice period but their demands of rupees 6 lacs is untenable under no circumstances you should pay that amount.

The maximum amount you can be made to pay if you do not serve the notice period can be your 3 month salary and nothing else.

Siddharth Jain
Advocate, New Delhi
5933 Answers
101 Consultations

5.0 on 5.0

This is my response to you:

1. Either the company can ask you to complete the notice period or forfeit salary;

2. They cannot at the same time ask you to, pay the compensation of 6 lacs;

3. If you do not wish to serve the notice period then, you have to surrender the salary;

4. Even then it is the discretion of the company to buy out the notice period;

5. So consult a local lawyer, let him/her verify your appointment letter and then take next steps.

Gowaal Padavi
Advocate, Mumbai
1920 Answers
5 Consultations

5.0 on 5.0

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