LexA. PRABHAKARA REDDY & CO. versus STATE OF MADHYA PRADESH & ORS.
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[2015] 9 S.C.R. 675 A. PRABHAKARA REDDY & CO. v. STATE OF MADHYA PRADESH & ORS. (Civil Appeal No. 375 of 2006 etc.) AUGUST 24, 2015 [VIKRAMAJIT SEN AND SHIVA KIRTI SINGH, JJ.] A B Building and Construction Workers' Welfare Gess Act, 1996 - s. 3 - Contracts for construction between the c appellants-contractors and the respondent-State - Before constitution of Madhya Pradesh Building and Other Construction Workers' Welfare Board- Demand of cess from the contractors - Challenged inter-alia on the ground that no cess could be levied on the contracts which came into D existence before the Board was constituted - Held: The demand of cess cannot be faulted and would not amount to retrospective application of the Gess Act - The scheme of the Gess Act, Building and Other 'Construction Workers' (Regulation of Employment and Conditions of Service) Act E (BOCW) and the Rules framed under the Gess Act, warrant imposition and collection of cess and for putting the same in the statutory welfare fund without delay - Such beneficial measures for the welfare of workers are applicable even to the construction activity which may have commenced befote F coming into force of the BOCW Act and the Gess Act, if they are subsequently covered by the provisions of these Acts - Levy of cess from the date of constitution of the Board is valid in respect of cost of construction incurred thereafter- Building and Other Construction Workers' (Regulation of Employment G and Conditions of Service) Act, 1996 - Building and Other Construction Workers' Welfare Gess Rules, 1998. 675" H 676 SUPREME COURT REPORTS (2015] 9 S.C.R. A Dismissing the appeals, the Court HELD: 1.1 After the Building and Other Construction Workers'Welfare CessAct, 1996 and the Building and Other Construction Workers' Welfare Cess Rules, 1998 came B into effect, and the Board was constituted, with the notification specifying the rate of cess to be levied upon thecostofconstruction, incurred by the employer already in place, the respondents were duty bound to collect the cess by ~aising the demands in respect of the on-going C construction works, if the workers in such construction activities were eligible for benefits under the Building and Other Construction Workers' (Regulation of Employment and Conditions of Service) Act, 1996 (BOCW Act). The fact that the task of registering the workers D and providing them the benefit, may take sometime, would not affect the liability to pay the levy as per the Cess Act. Any other interpretation would defeatthe rights of the workers whose P.rotection is the principal aim or primary concern and objective of the BOCW Act as well E as the Cess Act. The Cess is a fee for service and hence, its calculation, is notto be strictly in accordance with quid pro quo rule and does not require any mathematical exactitude. The scheme of the BOCW Act, the Cess Act F and the Rules warrant that the lawfully imposable cess should be imposed, collected and put in the statutory welfare fund without delay so that the benefits may flow to the eligible workers at the earliest. The scheme of the BOCW Act or the Cess Act does not warrant that unless all G the workers are already registered or the welfare fund is duly credited or the welfare measures are made available, no cess can be levied. In other words the service to the workers is not required to be a condition precedent for the levy of the cess. The rendering of welfare services can H reasonably be undertaken only after the cess is levied, A. PRABHAKARA REDDY & CO. v. STATE OF MADHYA 677 PRADESH & ORS. collected and credited to the welfare fund. [Para 12) A [683-H; 684-A-F] 1.2 Such beneficial measures for the welfare of workers are applicable even to the construction activity which may have commenced before coming into force of B the BOCWAct and the Cess Act, if they are subsequently covered by the provisions of these Acts. There can be no legal obstacle in ignoring the construction cost incurred before the cess became leviable by distinguishing it from the cost of construction incurred later, from a date when C the Board is available to render service to the Building and other construction workers. Levy of cess in these facts and circumstances cannot be faulted for any reason. Demand of cess in the given facts cannot amount to retrospective application of the Cess Act. [Para 13) [684- D H; 685-A-C] Dewan Chand Builders and C
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