DENA NATH AND ORS. versus NATIONAL FERTILIZERS LTD. AND ORS.

Citation: [1991] SUPP. 2 S.C.R. 401 · Decided: 22-11-1991 · Supreme Court of India · Bench: K. JAGANNATHA SHETTY · Disposal: Dismissed

Judgment (excerpt)

DENA NATH AND ORS. 
v. 
NATIONAL FERTILIZERS LTD. AND ORS. 
NOVEMBER 22, 1991 
[K.JAGANNATHA SHETTY AND YOGESHWAR DAYAL, JJ.] 
Contract Labour (Regulation and Abolition) Act, 1970--Title, Pre-
amble and Statement of Objects and Reasons-Purpose and scheme. of the 
Act. 
Contract Labour (Regulation and Abolition) Act, 1970--Sections 7. 
12-Non-Comp/iance of by Principal Employer and Contractor 
respectively-Effect-Employees employed through Contractor whether 
becomes Principal Employer's employees. 
A 
B 
C' 
Constitution of India, 1950-Article 2.26-Writ of mand-
D 
amus-Question of abolition of contract labour-Government to decide 
under section 10 of the Contract Labour (Regulation and ,,;bolition) Act, 
1970 and not the High Court in a writ proceeding. 
Following its earlier decision in 1991(1) P.L.R.I. the High Court 
held that the principal employer and the Contractor were liable for E 
prosecution under the Contra.ct Labour (Regulation and Abolition) 
Act, 1970, if they made non-compliance of section 7 and section 12 
of the Act, respectively. Further, it was held that the employee 
employed through the contractor did not become the employees of 
the principal employer. 
C.A.No. 2335 of 1991 arose by special leave from the decision 
of the High Court. The point invoh'ed in other appeals is common. 
This Court, on th.e question, if the· principal employer did not get 
registration under section 7 of the Act and/or the contractor did not 
F 
get a·-iicence under Section 12 of t.Jte,, Act, whether the person so 
appointed by the principal employer through the contractor would 
G 
be deemed to the direct employees of the principal employer or not, 
dismi$sing the appe.als. 
HELD:- 1.The iong title and the preamble of the Contract La-
bour (Regulation and Abolition) Act, 1970 show that it is an Act to 
regulatf the empioyment of contract labour in certain establish-
H 
401 
402 
SUPREME COURT REPORTS 
[1991) SUPP. 2 S.C.R. 
A 
ments and to provide for abolition in certain circumstances and for 
matters connected therewith. The Statement of Objects and Reasons 
mentions that the system of employment of contract labour has tended 
itself to various abuses and the question of its abolition had been 
under consideration of the Government for a long time. (405 EJ 
B 
2. The Contract Labour (Regulation and Abolition) Act serves 
two-fold purpose (1) regulations of the conditions of service of the 
workers employed by the contractor who is engaged by a principal 
employer; and (2) also provides for the appropriate Government 
abolishing contract labour altogether, in certain notified processes 
operation or other works in any establishment. Netither the Act nor 
c the Rules framed by the Central Government or by any appropriate 
_Government provide that upon abolition of contract labour, the 
said labour would be directly absorbed by the principal employer. 
[407 H-408 A} 
3.. The Act as can be seen from the Scheme of the Act merely 
D 
regulates 'the employment of contract labour in certain establish-
ment and provides for its abolition in certain circumstances. The 
A~t does not provide for total abolition of contract labour-but it 
provides for abolition by the appropriate Government in appropri-
ate cases under Secti_on 10 of the Act. [413 H-414 A] 
E 
F 
G 
H 
4. ID the present case and the other connected Special Leave 
Petitions no notification bas been issued by the appropriate Govern-
ment under Section 10 of the Act. [414 BJ 
5. It is not for the High Court to inquire into the question 
and decide whether the employment of contract labour in any proc-
ess, operation or in any other work in any establishment should be 
abolished or not. It is a matter for the decision of the Government 
after considering the matter, as required to be considered under 
Section 10 of the Act. [414 C-DJ 
6. In proceedings under Article 226 of the Constitution merely 
because contractor or the employer bad violated any provision of 
the Act or the Rules, the court could not issue any mandamus for 
deeming the contract labour as having become the employees of the 
principal employer. [414 EJ 
Mis Gammon India Ltd. and Others v. Union of India, [197.4)1 SCC 
596; Standard Vacuum Rejining-cD. v~ Their workmen, [1960)2 LLJ 233 
(S.C.); F.C.L Loading and Unloading Workers Union v. Food Corpora-
.:. . 
. ,• 
DENA NATH v. NATIONAL FERTILISERS [YOGESHWARDAYAL, J.) 
403 
tion of India 1986 (2) SLR 454 (Karnataka); Food Corporation of India 
A 

Excerpt shown. Read the full judgment & AI analysis in Lexace.