Well, It is upto employee that he declares his previous salary/taxable income to the next empolyer or not.
As he was paid 3.60 without any tds, so it seems he should have savings/losses atleast of 3.60-2.00(exemption)=1.60 this is why his previous employer did not cut any tax on it. anyway, If the employee furnishes his previous salary income in Form 12B to the new employer, with all his permissible deductions (80C to 80U asap) and losses from house property, then the new empolyer will calculate his tax on total income-total savings+losses from house property.
If the employee do not furnish his previous income details in Form 12B to the new employer, then the new employer need to calculate tax on 4.2 lacs only. in this case the employee will have to pay remaining calculated tax on his total income in a FY while filing the IT return.