GAMMON INDIA LTD. ETC. ETC. versus UNION OF INDIA & ORS. ETC.

Citation: [1974] 3 S.C.R. 665 · Decided: 20-03-1974 · Supreme Court of India · Bench: A.N. RAY · Disposal: Dismissed

Cited by 3 judgment(s) · cites 1 · see the full citation network in Lexace

Judgment (excerpt)

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GAMMON INDIA LTD. ETC. ETC. 
v. 
UNION OF INDIA & ORS. 
ETC. 
March 20, 1974. 
665 
[A. N. RAY C.J., P. JAGANMOHAN REDDY, s. N. DWIVEDI, P. K. 
GosWAMI AND R. S. SARKARIA JJ.] 
Contract Labour (Rqu/atfon and Abolition) Act, 1970-Constitutional raJidity 
of,-Scope and app/i~alion of-Validity of the Rules made under the Act. 
Interpretation of statutes~jusdem generis. 
The Contract Labour (Regulation and Abolition) Act, 1970, requires contrac~ 
tors to take out licenses. The Act also imposes certain duties and liabilities on the 
contractor, in respect of the workmen cmployCd by the contractors. The Contrac-
tor is defined as a person who undertakes to produce a given result for the establish-
ment through contract labour or who supplied contract labour for any work of the 
establishment and includes a sub-contractor. It was contended that the application 
of the Act is in respect of pcndina; work of construction amounts to unreasonable 
restriction on the right of the contractors violating article 19(1){&) of the Constitution. 
Itw1~Jurth,rcorttended that th" f~ prescribed for registration, licences, or renewal 
of licences amount to a tax and arc, therefore, beyond the rule.making powers or 
the Central and State Government. 
It was further contended that the _provisions 
of the Act are unconstitutional and unreasonable because of impracticability of im-
plementation. Provisions in regard to canteens, rest rooms, latrines and urinals 
as contemplated by sections 16 and 17 of the Act read with Central Rules 40 to 56 
and rule 25(2) (vi) arc incapable of implementation and enormously expensive as 
to amount to unreasonable restrictions within the meaning of Article 19(1)(g). 
The provisions contain in Central Rule 2S(2)(v)(b) were challenged as unreasonable. 
Rule 25 (2){v)(a) provides that wages and other conditions of service of workmen 
who do same or similar kind of work as the workmen employed directly in the prin-
cipal employer's establishment shall be the same. Jn case of disagreement it is prc-
vided that the same shall be decided by the Chief Labour Cmr.missionCr whose 
decision shall be final. Rule 25(2)(b) states that in other cases the wage rates holidays 
and conditions of service of the workmen of the contractor would be such as may 
be specified by the Chief Labour Co~issioner. There is no provision for appeal. 
It was also contended that the provisions in section 14 witk regard to forfeiture 
of security are unconstitutional The Validity of rule 24 which requires deposit 
of Rs. 30/- per workmen is chall~ as void under Articles 14 and 19(1Xf) both 
on the ground that the same is arbitrary and also . because there is no obligation 
on the Government to pay to the work.men or to utilise fer the workmen any part 
of the security ·deposit so forfeited. It was also contended that section 34 of 
the Act which empowers the Central Government to make any provision not incon-
sistent with the provisions of the Act for removal of difficulty is unconstitutional on 
the ground of excessive i;lelegatlon. The intervener challenged section 28 of the 
Act conferring power on the Government lo appoint Inspectors as conferring arbi-
trary and unguided power. 
It was also contended that the petitioners were not contractors within the mear.~ 
ing of the Act since the work of the petitioner is not any part of the work of the 
principal employer nor was the work normally done in the premises of the esta-
blishment of the principal employer. 
HELD : (1) The contention that the application of the Act to the pending work 
of construction amounts to unreasonable restriction Was negatived on the ground 
that the bill was introduced in 1967 and it was passed in 1970. The subject matter 
of the legislation is not contract; it is contract labour. There is no unreasonableness 
in its application to pending contracts. The pendency of contract is not a- relevant 
consideration. There is no retrospective operation. There is no material to show 
that the petitioner would suffer. The contractors have not shown the contract 
to show the rates of work. It is also not known whether the petitioners have clauses 
in the contract to ask for increase of rates in changed circumstqnces. 
[671F] 
(2) The fees_ prescribed for registration, licences and renewal· of licenses do not 
am >unt ,to a levy of taxes. The Government gives service iil regard to the licences 
anj registration. [671H] 
14-M 45 Sup Cl/75 
66 6 
SUPREME C

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