The Airport Authority of India v. Government of India and Others

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT:** ## **THE HONOURABLE MR.JUSTICE A.M.SHAFFIQUE** **FRIDAY, THE 5TH DAY OF JULY 2013/14TH ASHADHA, 1935** ## **WP(C).No. 15976 of 2007 (B)** **----------------------------** **PETITIONER(S): --------------------------** **THE AIRPORT AUTHORITY OF INDIA, INTERNATIONAL AIRPORTS DIVISION, TRIVANDRUM INTERNATIONAL AIRPORT, TRIVANDRUM 695 008 REPRESENTED BY ITS ASST. MANAGER (LAW), MRS.JOHN NELLIMALA SARAI.** **BY ADVS.SRI.K.L.NARASIMHAN, SC, TVM AIRPORT AUTHORITY OF INDIA SRI.V.SANTHARAM** **RESPONDENT(S):** **----------------------------** ## **1. GOVERNMENT OF INDIA,** - **MINISTRY OF LABOUR AND EMPLOYMENT, JAISALMER HOUSE, MANSINGH ROAD, NEW DELHI-110 011, REPRESENTED BY ITS SECRETARY.** **2. CENTRAL ADVISORY CONTRACT LABOUR BOARD, JAISALMER HOUSE, MANSINGH ROAD, NEW DELHI-110 011, REPRESENTED BY ITS CHAIRMAN.** **3. DEPUTY CHIEF LABOUR COMMISSIONER, MINISTRY OF LABOUR AND EMPLOYMENT, NO.26, HADDOWS ROAD, SASTHRI BHAVAN, CHENNAI-600 006.** **4. EX-SERVICEMEN INDUSTRIAL GUARDS (P) LTD., EASWARAVILASOM ROAD, JAGATHY, TRIVANDRUM-14, REPRESENTED BY ITS MANAGING DIRECTOR.** **5. RADHAKRISHNAN, FLAT NO.135, RAJAJI NAGAR, SECRETARIAT WARD, THIRUVANANTHAPURAM.** **6. JAYAN THOMAS,VENGALLOR, CHITTADI P.O., MUNDAKKAYAM, KOTTAYAM.** **..2/-** **Kss** **..2....** ## **WPC.NO.15976/2007 (B)** **7. C.RAJU, TC 45/838,VALIATHURA, VALLAKKADAVU.P.O., TRIVANDRUM.** **8. S.RAJENDRAN, JITHU SADAYAM, THALAYAL, ARALAMOODU P.O., ANTHIYOOR, NEYYATTINKARA.** **9. VENUKUMAR K.,AYANYARTHALAKKAL PUTHEN VEEDU, GANDHI NAGAR, MOTTAMOODU, NARUVAMOODU P.O., PALLICHAL, THIRUVANANTHAPURAM.** **10. P.R.PRASAD KUMAR,TC 43/3230. LEKSHMI NIVAS, T.C. (OLD) MARUTHAKUZHY, THIRUVANANTHAPURAM.** **11. P.BABUKUNJU, THOTTINAPPURAM,** - **T.20/1882, THANALAM, THIRUMALA, KARAMANA, THIRUVANANTHAPURAM.** **12. R.UDAYAKUMAR, T.C.77/2824, KAPIKUZHI VEEDU, CHACKA, VALLAKKADAVU P.O., THIRUVANANTHAPURAM.** **13. S.JAYAKRISHNAN, T.C.30/877, KUZHIVILAKOM PUTHEN VEEDU, THEATRE ROAD, PETTAH, THIRUVANANTHAPURAM.** **14. V.UNNIKRISHNAN NAIR, LAKSHMI BHAVAN, KERALADITHAPURAM, POWDIKANAM P.O., THIRUVANATHAPURAM.** **15. L.VIJAYAN, KUNNATH VEEDU, VENPALAVATTOM, ANAYARA P.O., THIRUVANATHAPURAM.** **16. C.VIJAYARAJ, VAYALIL MUDUMPIL VEEDU, ANNAYARA P.O., THIRUVANATHAPURAM.** **17. T.RAMESHAN, T.C.45/778. VALIATHURA, VELANKANNI JUNCTION, VALLAKKADAVU P.O., THIRUVANATHAPURAM.** **18. R.SUTHEESH, KAKKUTHUMELE PUTHEN VEEDU, PALLIMUKKU, PEYAD.P.O., THIRUVANANTHPURAM.** **19. MATHEW VINCENT, T.C.71/1217, (OLD T.C.45/1055), SEWAGE FARM ROAD, VALIATHURA, VALLAKKADAVU P.O., THIRUVANATHAPURAM.** **..3/-** **Kss** **...3.....** ## **WPC.NO.15976/2007 B** ## **20. VISHNU S.NAIR, ANU NILAYAM. T.C.53/490, STUDIO ROAD, NEMOM P.O., THIRUVANTHAPURAM.** ## **21. M.EDWIN, JAIN HOUSE, TC.45/46, VALIATHURA, VALLAKKADAVU P.O., THIRUVANATHAPURAM.** **22. G.HARI., PUTHUVAYAL PUTHEN VEEDU, SANGHUMUGOM BEACH ROAD, RAJEEV NAGAR, THIRUVANANTHAPURAM.** **23. K.SASI, SOBHANA MANDIRAM, POONTHURA P.O., THIRUVANANTHAPURAM.** **24. P.V.RAJESH KUMAR, ELUPPARA MUNDUMPIL VEEDU, USHA BHAVAN, ANAYARA P.O., THIRUVANANTHAPURAM.** **25. R.SUKUMARAN, SUPERVISOR, VADAKKAVILAKATHUR, TC 2/2307-1, HOUSE NO.86, T.J.ROAD, PATTAM P.O., TRIVANDRUM.** **R1 TO R3 BY ADV. SRI.K.I.ABDUL RASHEED, CGC BY SRI.P.PARAMESWARAN NAIR, ASST.S.G. OF INDIA R5 TO R8,R10 TO R13, R19,R20 & R23 BY ADV. SRI.KALEESWARAM RAJ** **THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 05-07-2013, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:** **Kss** ## **WPC.NO.15976/2007 (B)** ## **APPENDIX** ## **PETITIONER'S EXHIBITS:** - **P1: COPY OF AGREEMENT DTD. 1/11/05 EXECUTED BETWEEN THE PETITIONER AND 4TH RESPONDENT.** - **P2: COPY OF THE LICENCE NO.CL/L-20/2000 DTD. 5/05/2000.** - **P3: COPY OF THE REPRESENTATION DTD. 18/10/2004 FILED BY THE CONTRACT LABOURERS BEFORE THE SECOND RESPONDENT.** - **P4: COPY OF WRITTEN STATEMENT DTD. NIL FILED BY THE PETITIONER.** - **P5: COPY OF ITEM NO.29 OF MINUTES OF MEETING OF THE SECOND RESPONDENT HELD ON 27 & 28TH OF DECEMBER 2005.** - **P6: COPY OF THE COMMUNICATION DTD. 8/09/06 ISSUED BY THE FIRST RESPONDENT TO THE 7TH RESPONDENT.** - **P7: COPY OF THE ORDER NO.M20(3)/2007/DY.CLC P1 DTD. 30/03/2007 PASSED BY THE 3RD RESPONDENT AGAINST THE PETITIONER.** - **P8: COPY OF THE NOTICE NOTICE NO.34/08/2009/LEO/TVM DTD.07/02/2013 ISSUED BY THE LABOUR ENFORCEMENT OFFICER (CENTRAL), TRIVANDRUM.** - **P9: COPY OF THE REPLY NO.AAT/OPS/BS (LEGAL)/2013/83 DTD.28/02/2013.** ## **RESPONDENT'S ANNEXURES:** - **ANNEX.R1: COPY OF THE ORDER DTD. 11/10/91 IN I.A.NOS.1 AND 2 IN CIVIL APPEAL NOS. 2058-59 OF 1988.** - **ANNEX.R2: COPY OF THE ORDER DTD. 7/1/1994 IN I.A.NOS.3 & 4 OF 1992 IN CIVIL APPEAL NO.2058-59/1988.** - **ANNEX.R3: COPY OF THE ORDER NO.1/126/14(P)2004-LC DTD. 13/07/05.** **/TRUE COPY/** **P.S.TO JUDGE** **Kss** A.M.SHAFFIQUE, J. ---------------------------------------------------W.P.(C) No. 15976 of 2007-B --------------------------------------------------Dated this the 5[th] July, 2013 **J U D G M E N T** The petitioner challenges Ext.P7, an order passed by the Deputy Chief Labour Commissioner (Central), the 3[rd] respondent herein, determining the wage rates of the workmen employed by contract workers at a specified rate and also observing that in view of the long service rendered by some of the contract workers, all of them shall be allowed to work continuously, even though the contractor may change. The other conditions of service like holidays, hours of work and other conditions of service of the workmen engaged by the contractor were also fixed. It is indicated that the said amenities shall be provided to the W.P.(C) No. 15976 of 2007-B 2 contract workers. 2. The main contention urged by the petitioner is that though the 3[rd] respondent has jurisdiction to pass such an order, the same ought not have been passed against the Airport Authority of India, the petitioner herein. The matter related to the Contract Labour (Regulation and Abolition) Act, 1970 (hereinafter referred to as the Act) and the directions ought to have been issued against the contractor alone. It is the case of the petitioner that the contractor was not made a party to the proceedings and the directions issued apparently would indicate that Airport Authority, who is the principal employer is under obligation to comply with the said directions. W.P.(C) No. 15976 of 2007-B **==> picture [7 x 10] intentionally omitted <==** 3. Still further it is contended that the direction to employ the persons who have been working as contract workers continuously is totally unworkable and is not coming within the purview **.** of the decision making process under the Act 4. A statement is filed by the 3[rd] respondent supporting the stand taken in the impugned order. Counter affidavit is filed by the 19[th] respondent who is one of the workers supporting the stand taken by the competent authority. 5. Heard the learned counsel for the petitioner and the learned counsel appearing for the 19[th] respondent. 6. The learned counsel for the petitioner relied upon the judgment in **Senior Regional Manager, Food Corporation of India, Calcutta** 4 W.P.(C) No. 15976 of 2007-B v. **Tulsi Das Bauri** [(1997) 5 SCC 51] highlighting the principle to be adopted in terms of S. 21 of the Act. Paragraph 5 and 6 reads as under: “Section 21 postulates the responsibility for payment of wages. Under sub-section (1) a contractor shall be responsible for payment of wages to each worker employed by him as contract labour and such wages shall be paid before the expiry of such period as may be prescribed. Under sub-section (4), in case the contractor fails to make payment of wages within prescribed period or makes short payment, then the principal employer shall be liable to make payment of wages in full or the unpaid balance due, as the case may be, to the contract labour employed by the contractor and recover the amount so paid from the contractor either by W.P.(C) No. 15976 of 2007-B 5 deducting from any amount payable to the contractor under any contract or as a debt payable by the contractor. That liability has been prescribed under sub-section (2) thereof which that says every principal employer shall nominate a representative duly authorised by him to be present at the time of disbursement of the wages by contractor and it shall be the duty of such representative to certify the amounts paid as wages in such manner as may be prescribed. Thus it could be seen that the principal employer is statutorily responsible to ensure payment of the wages as per the law. In case the contractor commits default in the payment of the wages, the principal employer is made responsible for due payment and in case such payment is W.P.(C) No. 15976 of 2007-B **==> picture [7 x 10] intentionally omitted <==** made, he is entitled to have it recovered by deducting from any amount payable to the contractor under the contract or as a debt payable by the contractor“. 7. Reference is also made to the judgment of the Supreme Court in **Hindustan Steel Works Construction Ltd.** v. **Commissioner of Labour and Others** (1996 KHC 1693) in relation to the Andhra Pradesh Contract Labour (Regulation and Abolition) Rules, 1971 and the liability of the principal employer under Section 21(4) of the Act. Paragraph 14 of the said judgment reads as follows: “R.25 of the (Andhra Pradesh Contract Labour (Regulation and Abolition) Rules, 1971 imposes on the contractor certain conditions subject to which a licence is granted to him. One such condition is to the effect that the contractor shall not W.P.(C) No. 15976 of 2007-B 7 to the contract labour in his pay employment wages which are lower than the wages paid by the principal employer to his own workers which do the same or similar kind of work. This is a condition of the contractor's licence. There is no provision under these rules by which the principal employer is made liable for payment in the event of non compliance by the contractor with this condition. If the contractor commits a breach of the conditions of his licence he alone will take the The of the consequences. right workers to recover any additional wages which may be so determined would be against the contractor. S21(4) has no to a situation where a application contractor may have paid the wages but has not complied with the condition imposed by R.25(v)(a) of the Andhra Pradesh Contract Labour (Regulation and Abolition) Rules, 1971. The definition W.P.(C) No. 15976 of 2007-B 8 of wages under S.2 of Contract Labour (regulation and Abolition) Act, 1970 read with the definition of wages under the Payment of Wages Act, 1936, does not cover any additional amount found payable under R.25(v)(a) if the principal employer has its own workers doing similar work. If the principal employer does not have any employees doing similar work that question will not arise. Such contingencies are not covered by S.21 of the Contract Labour (Regulation and Abolition) Act, 1970. The contractor cannot recover any such additional amount from the principal employer under S.21(4). Significantly, in the present proceedings the workers are not a party at all. It is the contractor who sought to quash a finding given by the Commissioner of Labour under the proviso to Rs.25(v)(a) of the Andhra Pradesh Contract Labour (Regulation and Abolition) Rules, 1971. In W.P.(C) No. 15976 of 2007-B 9 the present appeal before us also the contract workers employed by the 4[th] respondent are not a party. The dispute is between the contractor and the principal employer. We are, therefore, not called upon the pronounce on the rights of the contract labour employed by the 4[th] respondent to recover these amounts. The appellant, however, who is the principal employer, is not liable to pay this additional amount under S.21(4). the appellant would, however, be liable under S.21(4) to pay to the workers any difference between the wages contracted for under its agreement with the 4[th] respondent- contractor and the lesser wages actually paid by the contractor to contract labour, and recover the same from the contractor.” v. 8. The judgment in **Karthikeyan Deputy Commissioner of Excise** [2011(1) KLT 334] is W.P.(C) No. 15976 of 2007-B 10 relied upon to point out that where a power is given to do a certain thing in a certain way, that thing must be done in that way, or not at all, and that other methods of performance are necessarily forbidden. 9. The learned counsel for the party respondent further relied upon the judgment of the Supreme Court in **U.P.Rajya Vidyut Utpadan Board and Another** v. **Uttar Pradesh Vidyut** [2009 (17) SCC 318]. Reference is made in paragraph 10, which reads as under: “Nature of work, duties and responsibilities attached thereto are relevant in comparing and evaluating as to whether the workmen employed through contractor perform the same or similar kind of work as the workmen directly employed by the principal W.P.(C) No. 15976 of 2007-B 11 employer. Degree of skill and various dimensions of a given job have to be gone into to reach a conclusion that nature of duties of the staff in two categories are on par or otherwise. Often the difference be of a may degree. It is well settled that nature of work cannot be judged by mere volume of work, there may be qualitative difference as regards reliability and responsibility”. **FACT** v. Another judgment relied upon is **K.A.Ayyappan Pillai** [2012(2) KHC 460] where reference is made to paragraph 9, which reads as under: “The of with scope engagement reference to the provisions under the Contract Labour (Regulation & Abolition) Act, 1970 has been well explained by the Constitution Bench W.P.(C) No. 15976 of 2007-B 12 of the Apex Court in Steel Authority of India Ltd. v. National Union Waterfront Workers, wherein the relevant provisions of the said Act, as they existed before and after the amendment in 1986, have been discussed in detail. If there was a notification prohibiting the 'contract labour' under Section 10 of the Act, whether the employees would get automatic regularization, was also a matter considered by the Bench and it was held, among other points, that even in such a case, the matter had to be adjudicated by the Industrial Court and was not automatic“. 10. Having regard to the nature of the contentions urged by the respective parties and the case law relied upon, the short question to be considered is the validity of Ext.P7 order. In fact, W.P.(C) No. 15976 of 2007-B 13 pursuant to Ext.P7, demand was made by the Labour Enforcement Officer as per Ext.P8 for which the petitioner had sent a reply at Ext.P9 stating that the contract labours are paid wages at Rs.231/- per day which works out to Rs.6,006/- per month before ESI & PF deductions and bonus is being paid at the rate of 8.33% per annum. 11. The 3[rd] respondent has exercised the jurisdiction to pass impugned order in terms with Rule 25(2) (v) (b) of the Contract Labour (Regulation & Abolition) Central Rules, 1971, which reads as under: “Forms and terms and conditions of licence.- xx xx (2) Every licence granted under sub-rule (1) or renewed under rule 29 shall be subject to the following conditions, W.P.(C) No. 15976 of 2007-B 14 namely:- xx xx xx (v) (a) in cases where the workman employed by the contractor perform the same or similar kind of work as the workmen directly employed by the principal employer of the establishment, the wage rates, holidays, hours of work and other conditions of service of the workmen of the contractor shall be the same as applicable to the workmen directly employed by the principal employer of the establishment on the same or similar kind of work: Provided that in the case of any disagreement with regard to the type of work the same shall be decided by the Deputy Chief Labour Commissioner (Central). (b) in other cases the wage rates, holidays, hours of work and conditions of service of the workmen of the W.P.(C) No. 15976 of 2007-B 15 contractor shall be such as may be specified in this behalf by the Deputy Chief Labour Commissioner (Central): Explanation.- While determining the wages rates, holidays, hours of work and other conditions of services under (b) above, the Deputy Chief Labour Commissioner (Central) shall have due regard to the wage rates, holidays, hours of work and other conditions of service obtaining in similar employments;” 12. The main contention urged by the petitioner is based on S.21 of the Act which reads as under: “ **Application for a licence.** - (1) Every application by a contractor for the grant of a licence shall be made in triplicate in Form IV, to the licensing officer of area in which the establishment, in relation to which the establishment, in relation to which he is the contractor, is located. W.P.(C) No. 15976 of 2007-B 16 (2) Every application for the grant of a licence shall be accompanied by a certificate by the principal employer in Form V to the effect that the applicant has been employed by him as a contractor in relation to his establishment and that he undertakes to be bound by all the provisions of the Act and the rules made thereunder in so far as the provisions are applicable to him as principal employer in respect of the employment of contract labour by the applicant. (3) Every such application shall be either personally delivered to the licensing officer or sent to him by registered post“. (4) On receipt of the application referred to in sub-rule(1), the licensing officer shall, after noting thereon the date of receipt of the application, grant an acknowledgment to the applicant. W.P.(C) No. 15976 of 2007-B **==> picture [13 x 10] intentionally omitted <==** (5) Every application referred to in sub-rule (1) shall also be accompanied by a demand draft showing- (i) the deposit of the security at the rates specified in rule 24, and (ii) the payment of the fees at the rates specified in rule 26”. 13. The contention is that when the contractor is responsible for payment of wages to each persons employed by him as contract labour in terms of S.21(1) of the Act, there cannot be a situation where the 3[rd] respondent while exercising the jurisdiction under Rule 25 of the Rules to impose an obligation to pay the wages and other obligations on the principal employer. 14. It is not in dispute that the liability of the principal employer is provided under sub-section (2) W.P.(C) No. 15976 of 2007-B 18 of Section 21 which says that the principal employer shall nominate a representative to ascertain whether the contractor has disbursed the wages in terms of S.21(1). Further sub-section (4) indicates that if the contractor fails to pay the same within a prescribed period or makes short payment, then the principal employer shall be liable to make payment to the contract labour and thereafter recover the amount from the contractor. Even going by Rule 25(2) (b), the 3[rd] respondent will have to fix the wage rates, holidays, hours of work and conditions of work service of the workmen of the contractor. Therefore, when the 3[rd] respondent passes an order he is only determining the wage rates, holidays, hours of work and conditions of service of the workman of the W.P.(C) No. 15976 of 2007-B **==> picture [13 x 10] intentionally omitted <==** contractor and not the Airport Authority of India who is the petitioner herein or that of the principal employer. In that view of the matter there cannot be any doubt that the impugned order can only be an order by which there is determination of the wage rates, holidays, hours of work and other conditions of service of the workers engaged by the contractor. It is also relevant to note that nowhere in that order it is stated that Airport Authority of India is under obligation to comply with the aforesaid determination. Going by the Scheme of the Act and the Rules framed thereunder it is definitely the obligation of the contractor to comply with the directions issued at Ext.P7. W.P.(C) No. 15976 of 2007-B 20 15. No doubt the authority had passed an order without hearing the contractor. No specific procedure is prescribed under the Rules which indicate that the rate of wages payable to the workman by the contractor shall not be less than the rate prescribed under the Minimum Wages Act for such employment and where the rates have been fixed by a settlement or award it should not be less than the rate so fixed. The Explanation to Rule 25(2)(b) would show that while determining the wage rates, holidays, hours of work and other conditions of service, the 3[rd] respondent shall have due regard to the wage rates, conditions of service obtaining in similar employments. The petitioner also has a case that such a consideration has not been made. The fact W.P.(C) No. 15976 of 2007-B **==> picture [13 x 9] intentionally omitted <==** remains that the concerned contractor has not been heard and the order does not disclose regarding the nature of enquiry that had been conducted by the 3[rd] respondent. Hence it is argued that without hearing the contractor, the 3[rd] respondent have determined the wage rates and conditions of service. But it is relevant to note that the contractor is always a fluctuating body and there is no hard and fast rule that a particular contractor alone will undertake the contract employment. It may change due to varied circumstances. Therefore when the principal employer is giving a contract to a contractor, it is the obligation of the principal employer to ensure that the contractor complies with the requirement as specified by the 3[rd] respondent. For that W.P.(C) No. 15976 of 2007-B **==> picture [13 x 9] intentionally omitted <==** reason, even if the contractor is not heard in the matter, I do not think that the situation may have changed. 16. But there is some justification on the part of the learned counsel for the petitioner in making the submission that the authority concerned did not have the details regarding the employment particulars of the workers other than the statement given by the workers. Therefore, it was not proper on the part of the 3[rd] respondent to direct continuity in employment of the existing workers and imposing it as an obligation on the part of the petitioner. Taking into consideration the nature of employment, I do not think that the authority is vested with the jurisdiction to direct continuous employment to contract workmen. Only W.P.(C) No. 15976 of 2007-B 23 the contractor could decide whether they should be continuously employed or not. Hence that part of Ext.P7 is liable to be set aside. 17. However, on a perusal of the wages determined as well as the conditions of service imposed by the 3[rd] respondent at Ext.P7, I do not think that there is any necessity to quash the said proceedings as such and interference is required only to the extent hereinafter mentioned. Hence the writ petition can be disposed of as follows: i) Ext.P7 order in so far as it directs continuity of employment to all the contract workmen shall be set aside. ii) That Ext.P7 order shall not be enforced against the petitioner and shall only be treated as W.P.(C) No. 15976 of 2007-B **==> picture [13 x 9] intentionally omitted <==** determination of the wage rates, holidays, hours of work and other conditions of service of the workmen engaged by the contractor. iii) That the petitioner shall be under obligation to ensure that the contractor complies with Ext.P7 order. Sd/- **A.M.SHAFFIQUE, JUDGE.** rka /true copy/