HINDUSTAN STEELWORKS CONSTRUCTION LTD. versus THE COMMISSIONER OF LABOUR AND ORS.

Citation: [1996] SUPP. 5 S.C.R. 447 · Decided: 03-09-1996 · Supreme Court of India · Bench: N.P. SINGH · Disposal: Appeal(s) allowed

Judgment (excerpt)

HINDUSTAN STEELWORKS CONSTRUCTION LTD. 
A 
v. 
THE COMMISSIONER OF LABOUR AND ORS. 
SEPTEMBER 3, 1996 
[N.P. SINGH AND SUJATA V. MANOHAR, JJ.] 
B 
Labour Law: 
Contract Labour (Regulation and Abolition) Act, 1970 : Sections 
2(1)(h), 7, 12 and 21(1)(4). 
C 
Contract labour---Payment of wages-Contractor agreed to supply 
workers to principal employe1~However, contractor paid lower wages to his 
workers than those paid by p1incipal employer to his workers-Commissioner 
of Labour found there was similarity of work between workers of principal 
employer and contract labow--Held : Wages meant contractual wages pay-
D 
able in presenti under terms of employment between contractor and contract 
labour as well as under any existing award, settlement or order of court-!/ 
the contractor did not pay these wages, the principal employer became liable 
to make good the difference and recover the same from contractol--However, 
such liability of the principal employer did not cover any additional amount E 
payable by contractor under R. 25(v) (a) of A.P. Rules which required wages 
of contract labour at par with wages of principal employer's workers who did 
same or similar kind of work-However, if contractor paid lesser wages than 
the contractual wages the principal employer was liable to pay the difference 
and recover the same from contracto1~A.P. Contract Labour (Regulation 
and Abolition) Rules, 1971, Rr.25(v)(a) & 21-Payment of Wages Act, 1936, 
S.2(vi). 
F 
Contract labou~Payment of wages-Workers who did same or similar 
kind of work-Difference between contractual wages and actual 
wages-Recovery of additional amounts-Rights of contract laboul--Held : G 
Question left open since the contract labour was not a party. 
Words & Phrases : 
"Wages"-Meaning of-!n the context of Section 2(J)(h) of the Contract 
Labour (Regulation and Abolition) Act, 1970. 
H 
447 
A 
B 
448 
SUPREME COURT REPORTS (1996] SUPP. 5 S.C.R. 
The appellant was a Government company and registered as an 
employer under Section 7 of the Contract Labour (Regulation and Aboli-
tion) Act, 1970. Respondent-4 was a private company and possessed a 
licence as a contractor under Section 12 of the said Act. As per an 
agreement, respondent 4 agreed to supply to the appellant watch and ward 
workers on the terms and conditions specified therein. The appellant had 
accordingly paid to respondent-4 the remuneration of the workers. How-
ever, respondent-4 paid lower rate of wages to the workers and retained 
the balance amounts. The Assistant Commissioner of Labour visited the 
site of the appellant and found that there was a difference between the 
wages paid by the appellant to its own watch and ward staff and the 
C contract labour supplied by the res11ondent-4 who were doing similar work. 
Therefore, he filed a complaint before the Commissioner of Labour who, 
under Rule 2S(v)(a) of the Andhra Pradesh Contract Labour (Regulation 
and Abolition) Rules, 1971, held that the workers supplied by respondent-4 
performed the same kind of work as that performed by the workers of the 
D appellant itself. 
E 
F 
Respondent-4 filed a writ petition before the High Court challenging 
the order of the Commissioner of Labour. A Division Bench of the High 
Court directed : (i) that respondent-4 should pay to the workers the 
amounts retained by it from out of the amounts which were paid by the 
appellant in respect of the wages of the workers supplied by it; (ii) that the 
appellant should pay to the contract labour the difference between the 
wages paid by the appellant to its own security staff; and (iii) that in case 
the contractor failed to pay the amounts to the contract labour concerned, 
the appellant should pay the same to the contract labour employed by it 
and may thereafter recover the amount so paid from respondent-4. Being 
aggrieved by these directions the appellant preferred the present appeal. 
Allowing the appeal in part, this Court 
HELD: 1. In view of Section 2(1)(h) of the Contract Labour (Regula-
G tion and Abolition) Act, 1970 read with Section 2(vi) of the Payment of 
Wages Act, 1936, the term 'wages' for the purpose of Section 21 of the Act, 
means contractual wages which are payable under the terms of employ-
ment as between the contractor who is the employer and _the contract 
labourers who are his employees. If the contractor does not pay these 
H wages to his workmen engaged by him as contract labourers, then under 
HIND UST AN STEELWORKS CONTN.v. COMM

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