A.F.R.

IN THE HIGH COURT OF ORISSA, CUTTACK

W.P.(C) No.13332 of 2004

In the matter of an application under Articles 226 and 227 of the

Constitution of India.
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Paradip Port Trust …..… Petitioner

-Versus-
Deputy Chief Labour Commissioner & others …..… Opp.parties

For Petitioner : Mr. S.K. Padhi, Sr. Advocate

along with Mr. S. Sharma,
Advocate

For Opp.party nos.1 & 2 : Mr. B.S. Rayaguru, CGC

For Opp. Party no.3 : None

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P R E S E N T:

THE HONOURABLE SHRI JUSTICE BISWANATH RATH

AND
THE HONOURABLE SHRI JUSTICE M.S. SAHOO
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Date of hearing: 13.03.2023 Date of judgment: 23.03.2023
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M.S.SAHOO, J By filing the present writ petition, the petitioner-

Paradip Port Trust has challenged the order
no.35(1)/2003-DYCLC, dated 10 November, 2004,
passed by the Deputy Chief Labour Commissioner
(Central), Dhanbad (opp.party no.1 herein), exercising
the powers under Rule 25 (2) (v) (a) of the Contract
Labour (Regulation & Abolition) Central Rules, 1971,
(hereinafter referred to as the “Central Rules, 1971”).
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Brief Background

2. The listed contractors of the Port Trust used to

supply the labourers such as unskilled, Semi-skilled,
Skilled and Highly Skilled, who used to work in different
areas of the Port Trust. It is contended by the petitioner
that the Port Trust ensures the workers are paid not less
than minimum wages as fixed by the Ministry of Labour,
Government of India from time to time.
Opp.Party no.3 – Workers’ Union had approached
the Deputy Chief Labour Commissioner (Central),
Dhanbad, vide letter dated 11.04.2004 which was
forwarded to the Port Trust for comments vide letter
dated 30.04.2003 and the Port Trust furnished its
comments vide letter dated 23.05.2003 (Annexure-4
series). Pursuant to the letter dated 31.12.2003 of the
Deputy Chief Labour Commissioner, the Port Trust
furnished the desired information vide its letter dated
16.08.2004 (Annexures-5 & 6).
The learned Deputy Chief Labour Commissioner
(Central) visited the different working areas of the Port
Trust where the Contractor’s labourers were working
during the month of August 2004 and submitted his
report vide letter dated 13th September, 2004
(Annexure-7).
On receipt of the said report under Annexure-7, the
Port Trust vide letter dated 28/29th September, 2004
requested the learned Deputy Chief Labour
Commissioner (Central) for three months time to examine
the report and collect facts and figures from various
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departments concerned and to submit its reply and

prayed that the matter be heard at Paradip (Annexure-8).
The petitioner-Port Trust also pointed out to the
Deputy Chief Labour Commissioner (Central) in its reply
under Annexure-8 that a principled decision had been
taken to discontinue the practice of contract labourers as
far as possible and in effect the workers engaged were
disengaged with effect from 01.09.2004.
The Deputy Chief Labour Commissioner (Central),
Dhanbad (opp.party no.1) after making a determination
on various issues, i.e., determination of wages, leave with
wages, holidays, bonus, annual wage increase and
employees provident fund had further directed following :
“... ...The Chairman of Paradip Port Trust is
directed to implement the aforesaid order with
effect from 1st November 2004 onwards.”

The Challenge
3. The order dated 10.11.2004 passed by the Deputy
Chief Labour Commissioner (Central), Dhanbad
(opp.party no.1) directing the petitioner to implement the
order w.e.f. 1.11.2004 is impugned in the present writ
petition.
This Court by order dated 21.12.2004 issued notice
to the opp. parties and directed stay of operation of the
order dated 10.11.2004 passed by the Deputy Chief
Labour Commissioner (Central), Dhanbad (opp.party
no.1) in Annexure-9 and the order impugned has
remained stayed throughout the present proceeding.

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4. Pursuant to the notices issued by this Court,

opposite parties have appeared through their counsel.
When the matter was heard today, apart from the
learned Central Government Counsel appearing for the
opposite party nos.1 and 2, no one was present for
opp.party no.3-Union though the notice was sufficient.
Pleadings having been complete the matter was heard
and disposed of as agreed by the learned counsel for the
appearing parties.
Submissions
5. Mr. Padhi, learned Senior Counsel appearing for
Paradip Port Trust relies on the decision rendered by the
Hon’ble Supreme Court in Hindustan Steel Works
Construction Ltd. v. Commissioner of Labour and
others: (1996) 10 SCC 599 wherein the Hon’ble
Supreme Court dealt with a pari materia provision i.e.,
Rule 25 of the A.P. Contract Labour (Regulation and
Abolition) Rules, 1971 to contend that the direction
issued to the Chairman, Paradip Port Trust is
unsustainable in law, in view of the statutory provision
as interpreted by the Hon’ble Supreme Court in
Hindustan Steel (supra).
The relevant paragraphs of Hindustan Steel
(supra) are quoted herein :

“11. Under Section 35 of the said Act the appropriate

Government is entitled to make rules for carrying out the
purposes of this Act. Accordingly, the Government of
Andhra Pradesh has framed The Andhra Pradesh
Contract Labour (Regulation and Abolition) Rules, 1971.
Rule 21 of these rides requires; that every application by
a contractor for the grant of a licence shall be made in the
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manner prescribed in that rule. Rule 25 provides that

every licence granted under sub-section (1) of Section
12 shall be in Form VI and shall be subject to the
conditions specified in Rule 25. Condition (v)(a) is as
follows ;

"Rule 25(v)(a) in cases where the workmen

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 constructor 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 Commissioner of Labour, Andhra
Pradesh, whose decision shall be final."

13. The short question that arises for determination is

whether the appellant who is the principal employer is
liable to pay to the contract workers any amount which
constitutes the difference between the wages payable to
the contract labour by the contractor and the wages paid
by the appellant to its own employees doing similar work.
The Division Bench seems to have relied upon Section
21(4) of the said Act for this purpose. Section 21(1),
however, provides that the contractor shall be responsible
for the payment of wages to each worker employed by
his. Section 21(4) provides that if the contractor fails to
make this payment or any part thereof, the principal
employer is liable to make this payment and may recover
the same from the contractor as set out in that sub-
section. Looking to the definition of Wages Under the said
Act read with the definition of wages in the Payment of
Wages Act, which we have set out earlier, it is clear that
Section 21 Only deals with the payment of contractual
wages by the contractor to each of his worker. The
definition of wages would cover within its scope, inter
alia, also those amounts which the contractor is liable to
pay to his workers under any award, settlement or order
of court as Well as other amounts falling within the
definition of "wages" under the Payment of Wages Act.
Sub-section (2) provides for a representative of the
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principal employer supervising this payment. Clearly,

therefore, the wages which are the subject-matter
of Section 21 are specified sums which are payable in
praesenti by the contractor under the terms of his contract
of employment with each worker as well as under any
existing award, settlement or order of the court. Section
21 does not deal with, nor does it cover the obligations
which are imposed upon a contractor under the
provisions such as the Andhra Pradesh Contract Labour
(Regulation and Abolition) Rules, 1971. Hence Section
21(4) will not apply to such obligations of the contractor
which may be the subject-matter of dispute between the
contractor and his workers at time of disbursement of
wages and which do not fall within the definition of
"wages" under the Act.

14. Rule 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 pay to the contract labour in his
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
consequences. The right of the workers to recover any
additional wages which may be so determined would be
against the contractor, Section 21(4) has no application to
a :situation where a contractor may have paid the wages
but has not complied with the condition imposed by Rule
25(v)(a) of the Andhra Pradesh, Contract Labour
(Regulation and Abolition) Rules, 1971, The definition of
wages under Section 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 Rule 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.

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xx xx xx

15. In the result, the appeal is allowed as above. The

direction of the Division Bench insofar as it directs the
appellant to pay additional wages as per the provisions
of Rule 25(v)(a) of the Andhra Pradesh Contract Labour
(Regulation and Abolition) Rules. 1971, is set aside. In the
circumstances, however, there will be no order as to
costs.”

[Emphasis supplied]

6. To fortify the submissions, learned senior counsel

refers to the award dated 27.03.2008 passed by the
learned Central Industrial Tribunal-cum-Labour Court
which ended in dismissal of the claim of the second
party-Union therein. The dispute referred by the
Government of India, in the Ministry of Labour by order
dated 09.08.2002 under the provisions of the Industrial
Disputes Act, 1947 was the following :
“Whether the action of the Management of Paradip
Port Trust by not considering the wages of DLRs at
par with the regular employees of PPT is justified ?
If not, what relief the DLRs are entitled to ?”

It is contended that in view of the dismissal of the

claim of the daily labour rated workers similar to those
who were dealt with by the Deputy Chief Labour
Commissioner (Central), Dhanbad by his order dated
10.11.2004, the present writ petition challenging the
order of the Deputy Chief Labour Commissioner
(Central), Dhanbad should also succeed.
Analysis & Conclusion

7. The relevant provision of law, i.e., Rule 25(2)(v)(a)

of the 1971 Rules is quoted herein for reference :

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 // 8 //

“Rule-25 (2)(v)(a) in cases where the workmen

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)”

8. It is noticed by us that the principles laid down

in Hindustan Steel (supra) have been reiterated by
the Hon’ble Supreme Court in SAIL v. Jaggu : (2019)
7 SCC 658 (Para-37 of SCC).

9. Applying the principles laid down in Hindustan

Steel (supra) to the present case, this Court is of the
considered opinion that there is no provision under the
Central Rules, 1971, by which the principal employer is
made liable for payment in the event of non-compliance
by the contractor with the condition as specified in Rule
25 (2) (v)(a) of the Contract Labour (Regulation and
Abolition) Act, 1971. The Rule may require the payment
of wages by the contractor but as far as between the
contractor and the principal employer, the principal
employer cannot be directed to pay the additional wages
as per the provisions of the Rules.
10. In view of the discussions above, the writ petition is
allowed. The order dated 10 November, 2004, passed by

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the Deputy Chief Labour Commissioner (Central),

Dhanbad is set aside.
On being asked by the Court, learned Senior
Counsel appearing for the Port Trust fairly submits that
the issue regarding claim of the workers qua the
contractor is not a subject matter of the present
challenge. Accordingly, issue pertaining to the claim of
the workers, if any, qua the contractor under whom they
were engaged is left open. In the facts and circumstances
of the case, there shall be no order as to costs.

……………………
M.S.Sahoo, J.

Biswanath Rath, J. I agree

the

...……………………
Biswanath Rath, J.

Orissa High Court, Cuttack

The 23rd March, 2023/dutta

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