M/S ION EXCHANGE (INDIA) LTD. vs RADHEYSHYAM AND ORS.

* IN THE HIGH COURT OF DELHI AT NEW DELHI
% Date of order: 31st January, 2024
+ W.P.(C) 13600/2018

M/S ION EXCHANGE (INDIA) LTD. ….. Petitioner
Through: Ms.Roopali Chaturvedi, Advocate

versus

RADHEYSHYAM AND ORS. ….. Respondents
Through: Kamlesh Kumar Mishra (DHLSC) Along with Ms. Renu, Bibhuti Bhusan Mishra, Ms.Shamisti Solomon, Ms.Megha Gupta & Ms.Trupty Juyal, Advocates

CORAM:
HON’BLE MR. JUSTICE CHANDRA DHARI SINGH

ORDER

CHANDRA DHARI SINGH, J (Oral)
1. The petitioner vide the present petition under Article 226 of the Constitution of India, seeks the following reliefs:
“E) Set-aside the Award dated 25.09.2017 passed by Labour Court No. IX in I.D. No.294/14
F) Pass such other order as this Hon’ble Court deems fit in the facts and circumstances of the case..”

2. The petitioner company, which is engaged in the business of manufacture, operation and maintenance of water purification. successfully participated in a Tender bearing no. IRCTC/RN/PROJ/2002/02 notified by the respondent no. 3 (‘respondent Corporation’ hereinafter) in the year 2002, for operation and maintenance of a bottling plant for packaged drinking water plant situated in Nangloi, New Delhi.
3. Pursuant to the successful bidding, the parties i.e. the petitioner and the respondent Corporation entered into an agreement dated 17th July, 2003 for a period of 5 years. In the said agreement, the petitioner was defined as the contractor and the respondent Corporation was termed as the purchaser.
4. Thereafter, the petitioner entity engaged an agency namely M/s AVM Services (respondent no. 2) for the supply of contract labour and entered into a contract dated 1st August, 2003. Pursuant to the said contract, the respondent no. 1 (‘respondent workman’ hereinafter) started working at the petitioner’s plant.
5. In the year 2006, the respondent workman was terminated, leading to filing of a dispute bearing ID no. 294/2014 before the learned Labour Court. The learned Court examined the statement of claims and heard the matter, and thereafter passed the impugned award dated 25th September, 2017 thereby, directing the petitioner entity to compensate the respondent workman for the alleged illegal retrenchment.
6. Being aggrieved by the same, the petitioner has filed the present petition.
7. Learned counsel appearing on behalf of the petitioner submitted that the impugned award is liable to be set aside since the learned Labour Court failed to take into consideration the entire facts and circumstances available on its record, and hence erred in passing the said award.
8. It is submitted that the impugned award suffers from illegality as the learned Labour Court followed a flawed and erroneous line of interpretation in holding the respondent Corporation as the principle employer and petitioner as the contractor for the purpose of the Contract Labour (Regulation and Abolition) Act, 1970 (hereinafter “the Act”).
9. It is submitted that the learned Court below failed to appreciate that the petitioner and the other management except respondent no. 2 had no control over the payment of salaries to the respondent workman. Therefore, no liability arises on part of the petitioner.
10. It is submitted that the contract agreement dated 17th July, 2003, was misconstrued by the learned Labour Court as it failed to examine the terms of the same in totality.
11. It is submitted that the learned Labour Court erred in holding that Clause 7.3 of the agreement provides for sole liability upon the petitioner entity in case of wrongful termination as the respondent workman was hired by the respondent no. 2 and not the petitioner.
12. It is also submitted that the respondent workman was supplied to the respondent Corporation through a sub-contractor, i.e., respondent no. 2 and therefore, they should have been labeled as a contractor under the Act, and not the petitioner herein.
13. Therefore, in view of the foregoing submissions, the learned counsel for the petitioner prays that the present petition may be allowed and impugned award may be set aside.
14. Per Contra, the learned counsel appearing on behalf of the respondent workman vehemently opposed the instant petition submitting to the effect that the impugned award has been passed in accordance with the law and hence, there is no infirmity thereto which makes the petition liable to be dismissed being devoid of any merits.
15. It is submitted that the failure of payment on part of the contractor would automatically shift the burden on the principal employer, i.e., the petitioner herein.
16. It is submitted that the respondent workman was employed under the establishment of the petitioner and the respondent Corporation and therefore, they are the principal employers as defined under Section 2(g) of the Act.
17. It is submitted that the above said provision covers any person/entity responsible for the supervision and control of the establishment and terms the same as the principal employer, which in present case would be both the petitioner and the respondent Corporation.
18. It is submitted that the agreement entered between the petitioner and the respondent Corporation clearly provides for liability upon the petitioner to provide and employ site of operation and maintenance of the said site which also includes the responsibility to take care of the workman employed to perform the task.
19. It is submitted that the sub-contract dated 8th April, 2003 entered between the parties i.e. the petitioner and the respondent no. 2 was for the supply of the respondent workman which clearly defines the role of the respondents which can directly be construed as workman for the establishment.
20. It is also submitted that even if Clause 7.3 of the original agreement dated 17th July, 2003 is interpreted in a way where the respondent no. 7 is also held liable to pay for retrenchment, the fact that the respondent workman was employee of the petitioner, cannot be denied.
21. It is further submitted that the impugned award specifically mentions that the petitioner had the responsibility to manage the site of the respondent Corporation and therefore, the obligation to provide manpower for the same only lies with the petitioner.
22. In view of the foregoing submissions, the learned counsel for the respondent workman prays that the present petition, being devoid of any merits, may be dismissed.
23. Heard the learned counsel for the parties and perused the record.
24. The petitioner entity has approached this Court against the impugned award claiming that the learned Labour Court failed to appreciate the material facts and therefore, wrongly held the petitioner to be liable for payment of compensation for the retrenchment of the respondent workman. It has been submitted that the petitioner entity has been wrongly termed to be the employer of the workman which clearly is not the case. In light of the same, the petitioner submits that the impugned award suffers from illegality making it liable to be set aside.
25. Therefore, this Court needs to analyze whether the impugned award suffers from any illegality or not. In order to analyze the same, the relevant extracts of the impugned award including the statements of the petitioner and the respondent workman are reproduced herein:

“…EVIDENCE OF WORKMAN & MANAGEMENTS

9. In support of the case workman Sh. Radhey Shyam was examined in chief and relied upon the documents Ex-. WW/1 and thereafter his further examination in chief was deferred however, on 24.01.2008 since none had appeared for management no. 2, it was proceeded exparte.
10. Thereafter the Workman was further examined in chief and party cross-examined from the side of management no.1 and 3 and further cross examination was deferred from the side of management no. 3. He has relied upon the, documents i.e. Ex. WWI/I legal notice, Ex. WW1/2 identity card of AVM services, Ex.WW1/3 copy of ESIC Card, Ex. WW1/4 copy of PF slip and EX WW1/5 to Ex. WW1/8, receipt of legal notice. However on the next adjourned date 23.09.2008 at the request of parties, the matter was adjourned for management evidence without concluding the cross examination of workman by management. No. 3.
11. Since both management no. 1 did not lead any evidence, the opportunity to lead management evidence by management no. 1 and 3 was closed vide order dt. 03.08.2010 passed by Sh. Chander Shakher the then POLC-V.
12. Thereafter on the application filed by management no. 1 for permission to lead evidence it was granted one opportunity to lead evidence subject to cost.
13. Even thereafter since the management no. 1 did not lead evidence its opportunity to lead evidence was again closed vide order dt. 23.12.2015 by the Predecessor of this court again the management had moved an application for recalling of the said order which was again allowed by this court vide order dt. 30.11.2016 subject to cost and the condition that management no. 1 shall lead its evidence within one date of hearing.
14. In support of its defence management no, 1 had examined MW,1 Sh,C. Subramanyam-Sr. Manager Finance of Management-No. 1 who has given his evidence by way of affidavit Ex. MW1/A. he has tendered his evidence Ex.. MW/1 certificate of incorporation (OSR), Ex.MW1/2 Resolution (OSR), Ex.MW1/3 agreement dt. 17.7.2003 (OSR), and mark a agreement dt. 01.8.2003 with AVM services and management no. 1 after examining MWI, AR for management no. 1 had closed its evidence on behalf of management no.1.

15. Since management no. 2 was already exparte in the matter vide order dt. 24.01.2008, and the opportunity of management no’. 3 to lead’ evidence was already closed vide roader dt. 03.08.2010 M.E. was closed and the case was fixed for final arguments.

ARGUMENTS OF AR FOR WORKMEN

16. It is argued by Ld. AR for workman that from the statement of workman his case stands proved. It is argued that since management no. 1 was the principal employer, it is its duty to get the labour facilities provided. It is stated that as per the other management have not appeared to contest the case of the workman, his case stands proved against those managements. They have not even cross-examination the workman hence the case of the workman stands proved against him.

ARGUMENTS OF MANAGEMENT NO.1

17. It is argued by-AR for management no. 1 that in fact the workman was employee of management no.3, transferred by management no. 3. It is stated that workman did not work under management no. 1. Neither management no. 1 appointed the workman nor paid PF, ESI or salary to him. No document is filed by workman to prove the relationship and as such he has failed to prove relationship no. 1. The workman has admitted the agreement between management no. 1 arid 3, his case is not that the agreement between us is sham. Not having the license to engage contractor does not make the employees of the contractor as the employees of principal employer. Management no. 1 is not having any powers to-take disciplinary action against the workman. Workman does not become of employee of principal employer in the absence of contractor. No-document is filed by the workmen to prove that he were appointed, surprised by management no.1. Hence, it is prayed that claim of workman is liable to be dismissed against management no. 1 Ld. AR for management no.1 has cited:

1. Kriloskar Mahale System Ltd. Pune Vs. Chander Kant Tuka Ram Ubhe & Ors. LLR 2008 Bombay 261.
2. APSRTC &Ors G.Siri Niwas Reddy &Ors. LLR 2006 page 433.
3. M/s Chand Chhap Fertilizer and Chemical Ltd. Kanpur Vs. Labour Commissioner, UP- Kanpur-& Ors. LLR 2006 page 724.
4. Haldia Refinery-Canteen Employees Union Vs. Indian Oil Corporation Ltd. LLR 2005 $C 529.
5. Sunil B Wagheia Vs. Zuhoo Villa Zimkhana Club & Ors. LLR 2002 Bombay 1205.
6. Pramod Kumar-.Samal & Ors. Vs. National Eluminium Co. Ltd. LLR 2002 Orissa 318.
7. FCI & Ors. Vs. Presiding Officer CQIT from Labour Court-1 Chandhi Garh Ors. LLR 2008 Punjab & Haryana 391.
8. Deena Nath & Ors. Vs. National Fertilizer Ltd. LLR 1992 Supreme Court 46.
9. New Delhi Mazdoor Union, Delhi office & Establishment Employees Union Vs. Standing Conference of Public Enterprises (Scope) & Ors. Delhi Lawyer 1991(l)(2) 189 DB Delhi.
10. UCO Bank Vs. Presiding Officer & Ors. AD-V 1999 Delhi 514.
11. Suresh Chand Mathur Vs. Harish Chand Mathur AD-IX 2010 Delhi 546.

12. Krishna Bhagya Gal. Nigam Ltd. VS. Mohd Raffi. LLR 2006 1080 Supreme Court.
13. Ravi N. Tikku’Vs. Deputy Commissioner SW &Ors. LLR 2006 Delhi 496.
14. Auto Mobile Association of. Upper India VS. Preliminary Objections Labour Court-2 &. Ors. LLR 2006 Delhi 851.
15. Extract of Sec. 23 and 25 of Contract Labour (Regulation &Abolition) Act 1970 is also relied upon….”

26. Upon perusal of the above, it is made out that both the parties i.e. the petitioner entity and the respondent workman had placed necessary facts and evidences on record to supplement their respective claims.
27. Pursuant to leading of the evidence and claim of the respective parties, the learned Court below formulated two main issues, first being the onus to prove working of 240 days in the petitioner entity is on the respondent workman and the second being the existence of the employer-employee relationship between the workman and the petitioner. While dealing with the both, the learned Court below deemed it appropriate to adjudicate both the issues together, relevant portion of which is as under :
“…..
18. 1have heard the arguments of AR for workman and management-no. 1 and perused the record. My issue wise findings are as under:

ISSUE NO. 1&2

19. As both the issues are interconnected they are decided together. The onus to prove issue no. 1 i.e. working of 240 days continuously with management no. 3 as well as of issue no. 2 regarding the existence of relationship if employer and employee between the workman and managements no. 1 and 2 upon the workman.

20. The workman has himself appeared as a witness in the case and has categorically deposed that he was employed w.e.f. 14.05.2003 on the work of loading job (helper) through management no. 3 M/s AVM services under the employment of managements no. 1 and 2 who are his principal employers.

21. On the other hand managements no. 1 and 2 have denied the relationship with, the workman stating that he was the employee of management no.. 3 who is sub contractor management no. 1. Admittedly management no. 1 had taken a contract being a successful bidder with regard to maintenance and operation of packaged drinking water of bottling plant at Nangloi of management no. 2 under a contract agreement dated 17.07.2003 executed between management no. 1 and 2. As per the defence of management no. 1 he had executed an agreement dated 08.04.2003 with management no. 3 to provide the workman on contract basis as per the requirement on daily basis. It is his case that workman was appointed by management no. 3 and that there is no relationship between workman and management no. 1 who has no-control or supervision over him, Similarly management no. 2 has stated that he had given the contract of Rail Neer Project to management no. 1 who was required to execute the work of maintenance, operation of packaged drinking water and was to provide the technical ; and non technical man power for operation and maintenance of the .plant and that management no. 3 may be a sub contractor and that the workman was under the employment of management np. 1 and 3 who are responsible for him and that there is no relationship of employer and employee between the workman and management no. 2., So far as management no. 3 is concerned, it has admitted the relationship with the workman stating that he joined the management only on 02.01.2006 and abandoned the job and has not completed 240 days of working with the management no. 3. In its written statement management no. 3 has no where mentioned that he was the sub contractor of management no. 1 under any agreement of 08.04.2003. It remained silent on the aspect whether it was a contractor with management no. 1 or not.

22. Neither management no. 2 nor management no. 3 has led any evidence in the. matter. Moreover, the workman was not cross-examined by management no.2 and management no. 3 has also not completed the cross-examination of the workman and turned ex-parte.

23. Management no. 3 has referred some temporary appointment. Letter allegedly given to the workman but no such appointment letter is placed on record by management no. 3. The workman has filed the copy of 1- card and the. ESIC card under management no. 3. However, the, management no. 3 did not lead any evidence to rebut that these documents are not authentic. Management no. 3 neither-led any evidence nor produced the alleged temporary appointment letter nor produced any other service record of the workman to show his employment from 2006 itself. Hence the authenticity of documents filed by workman cannot be doubled. Both the document provided the’ employment of. the workman since 2003. The working of the workman till 2006 is an admitted fact and as such from the testimony of the workman coupled with the ESIC record and I-card the working of the workman for more than 240 days continuously.in the year preceding the date of termination is duly proved.

24. Management- no. 2 has specifically mentioned that the entire responsibility of operation of the plant was of management no…1 who was to provide the man power and as such the workman was the employee of management no. 1 and 3 who are the contractor and sub-contractor.

25. Admittedly it is not the case of the workman that management no. 2 had appointed him. Now the question is whether the workman is the employee of management no. 3 only or whether management no. 1 is also liable towards the workman.

26. As I have already discussed, management no. 3′ has not pleaded about any agreement for providing of work force with management no. 1 as is put management no. 1 in its W/S. management no. 3 has not even appeared in the court after filing of the W/S and cross-examining the workman and not proved its defence Management no. 1 alleged the workman to be employee of management np. 3 denying any concern with management no. 1. It had stated in written statement that workman was withdrawn by management no. 3 but management no. 3, on the contrary pleaded that workman has abandoned the job. None of management no. 1 and 3 proved their respective contentions.

27. The workman has categorically deposed that he was deputed at the place of management no. 2 by management no. 3 through management no’. 1 and was illegally terminated by the managements.

xxx xxx xxx
28. Hence all the provisions mentioned above specially clause 7.3 specifically provide that in the event of retrenchment of workers by the contractor or sub-contractor employed by the contractor during or after the completion; of facilities, the contractor will pay the retrenchment compensation and other benefits to the workers as per Industrial Dispute Act. Hence the entire responsibility as per original contract between the management no. 1 and management no. 2 is of management no. 1 only. Even if management no. 1 appoints any contractor, the. ultimate responsibility on account of their retrenchment, is of management no. 1 only and management no. 1 cannot plead that the workers were not. its employees. It is also pertinent to mention here that I have gone through the agreement between management no. 1 and management no. 3 and there is no specific work for which the same was entered into between them. Putting a work force for the execution of a project which was given to the management no. 1 by management no. 2 on account of being a successful bidder, is the responsibility of management no. 1 only. At this stage, it is relevant to point out that during course of arguments, AR for management no. 1 has admitted, that management no. 1 has no licence to engage a contractor. Merely saying that the workman was employees of management no. 3 its sub-contractor cannot absolve it from the responsibility as mentioned in the original, agreement between management no. 1and management no. 2. No document is produced by management no. 1or management no. 2 to show that the workman was on the rolls of management no. 3 its sub-contractor or was appointed by management no. 3. As management no. 3has chosen not to contest the proceedings, by leading evidence, there is no corroboration to the facts as produced by management no. 1.

29. Even if management no. 1 has entered, into any sub contract with management no. 3, the ultimate responsibility qua the workman is only of management no. 1 in terms of the clauses of the Agreement between management no. 1 and management no. 2 as referred above.

30. Accordingly in view of above discussion it is proved by the workman that he had worked for more than 240 days in the year preceding the date of his termination at the place of management no. 2 and deputed through management no. 1 and 3. As it .is admitted by the workman and management that he was not employee by management no. 2, it is held that there is no relationship of employer and employee between the-workman and the management no. 2 whereas such a relationship-‘ exist between the workman and management no. 1 and 3. Accordingly both these issues are decided in favour of workman……”

28. Upon perusal of the aforesaid paragraphs, it is made out that the learned Labour Court had relied upon the contract dated 17th July, 2003, whereby Clause 7.3 clearly specifies the role of the parties. While adjudicating the said aspect, the learned Labour Court held that the petitioner entity was responsible for compensating the workman even if there is any sub-contract for employment of such workers as the terms in the agreement put an onus on the contractor, i.e., the petitioner herein.
29. Thereafter, the learned Court dealt with the dispute of retrenchment of the workman and had taken the statements of the workers and the petitioner while holding the termination illegal.
30. In the last issue, i.e., determination of the compensation towards the retrenchment, the learned Court had directed the petitioner entity to pay the compensation of Rs. 1,50,000/- towards the respondent workman.
31. During the course of proceedings before this Court, the learned counsel appearing for the petitioner vehemently argued that the learned Court below failed to correctly interpret the provisions of the agreement dated 17th July, 2003, and therefore, wrongly held the petitioner entity to be the employer of the workman whereas the respondent Corporation ought to have been held as the principal employer of the respondent workman.
32. The relevant extracts of the said agreement are reproduced herein:
“7.1 Labour: The Contractor shall provide and employ on the site for the Operation Maintenance of the Plant such skilled, semi-skilled and unskilled Labour as is necessary for the proper and timely execution of the contract. The Contractor shall at all times during the progress of the contract use its best endeavors to prevent any unlawful, riotous, or disorderly conduct or behavior by or amongst its employees and Labour and Labour of its sub-contractors/contractors.
The contractor shall, in all dealings with its Labour and the Labour of its sub-contractors employed on or connected with the contract, pay due regard to the laws and regulations pertaining to the employment of Labour.
7.2 Labour Rules: In respect of all Labour directly or indirectly employed on the works by the contractor, the contractor shall comply with and implement all the Provisions of the Contract Labour (Regulation and Abolition) Act 1970, or any amendment thereof, and all legislation and Rules of the state and/or Central Government or other local authority formed from time to time governing the protection of health, sanitary arrangements to be provided by the purchaser, wages, welfare measure and safety of Labour employed on the works and the contractor shall be deemed to the Principal Purchaser for this purpose. The rules and other statutory obligations with regard to fair wages, welfare and safety measures, maintenance of register, etc, will be deemed to be part of the contract. The contractor will get it registered with the concerned statutory authorities as provided in the act and shall be directly responsible of the authorities there under for compliance with the provisions thereof.
7.3 Provision of Minimum Wages Act and payment of wages. The contractor shall employ with the provisions and procedures of State Government’s Minimum Wages act 1948 & State Government’s Minimum Wages Fixation Act, 1962 and rules made there under in respect of all employees employed by the contractor or its sub-contractor (s) directly or indirectly for the purpose of carrying out the works. The contractor shall pay employees wages not less than the minimum rates of wages, if any, fixed by the State Government from time to time. The contractor’s/sub-contractor’s establishment will be subject to inspection, investigation, etc., by the Purchaser or its representative for assuring proper and faithful compliance of the provisions of the contract by the contractor (so with regard to the implementations of labor laws & other matters anticipated herein). The contract:sub-contractors shall abide by the decisions and orders of the Purchaser with regard to any such matter and furnish if required, necessary compliance.
In the event of retrenchment of workers by the contractor or sub-contractors employed by the contractor during or after the completion of facilities the contractor will pay the retrenchment compensation and other benefits to the workers as per the Industrial Dispute Act.
If any money shall as a result of any claim of application made under the said acts, be directed to be paid by the Purchaser, such money shall be deemed to be money payable to the Purchaser by the contractor and/or failure by the contractor to repay the Purchaser, and money paid by the Purchaser as aforesaid, latest within 30 days after the same shall have been demanded from the contractor, the. Purchaser shall be entitled to recover the same from any money due or accruing to the contractor under this or any other contract with the Purchaser, failing which such amount shall be considered as debt due from the contractor to the Purchaser.

7.4 Reporting of Accidents: The contractor shall be responsible for the safety of its own and its sub-contractors’ workmen and employees. All accidents at site are to be immediately reported to the required authorities. The contractor shall be responsible for all such accidents.
7.5 Provision of Workmen’s Compensation Act: The contractor shall be liable for in respect of any damages or compensation payable by law in respect of or in consequences of any accident or injury to any workmen or other person in the employment of the contractor or any of its sub-contractors and the contractor shall save harmless and shall indemnify and keep indemnified the Purchaser against all such damages and compensation and against all claims, demands, proceedings, costs, charges and expenses, whatsoever, in respect thereof or in relation thereto. The contractor shall at all times indemnify and keep indemnified the Purchaser against all claims for compensation under the provisions of the workmen’s Compensation Act, 1923, (VIII of 1923) or any other law for the time being in. forces by or in respect of any workmen employed by the contractor or its sub-contractors/agencies in crying out the contract and against all costs and expenses or penalties incurred by the Purchaser in connection therewith: In every case in which by virtue of the provisions of Section-12, Sub-Section (1) of the Workmen’s Compensation Act, 1923, the Purchaser is obliged to pay compensation to a workmen employed by the contractor or its sub-contractors/agencies, the amount of compensation so paid and without prejudice to the rights of the Purchaser under Section-12, Sub-section (2) of the said Act, the Purchaser shall be at liberty to recover such amount or any part thereof from the security deposit or from the sums due or to become due to the contractor whether under this contract or any other contract).
The Purchaser shall not be bound to contest any claim made against him under section-12; Sub-section (1) of the said Act, except on the written request of the same or his Sub-contractors/agencies and upon their giving to the Purchaser full security 10r all costs for which the Purchaser might become liable in consequence of contesting such claims.
7.6 Provisions of Apprentices Act: The contractor shall comply with the provisions of the Apprentices Act, 1961, and the rules and orders issued there under from time to time. If contractor fails to do so, his failure may be treated as breach of the Contract and the Purchaser may, in its discretion, terminate the contract.
The contractor shall also be liable for any pecuniary liability arising on account of any violation by him of the provisions of the said Act.
7.7 Labour Returns: The contractor shall, if required by the Purchaser, submit periodical statements of labour employed by the contractor in the perform prescribed by the Purchaser from time to time.
7.8 Preservation of Peace: The contractor shall take requisite precautions and use its best endeavor to prevent riotous or unlawful behavior by or amongst his workmen and/or other employed on the works by the contractor or its sub-contractors and for the preservation of peace and protection of the inhabitants and security of the property in the neighborhood of the works/site. In the event of the Purchaser requiring the maintenance of a special police force at or in the vicinity of the site during the tenure of the contract in consequence of the riotous or unlawful behavior by or amongst the contractor’s or its sub-contractor’s workmen and/others employed by the contractors/sub-contractors all expenses thereof and costs of all damages due to such riotous or unlawful behavior shall be, borne by the contractor and it paid by the Purchaser, shall be recoverable from the contractor from. any money due or that may become due to the contractor by the Purchaser.
7.9 Payment of Wages: The contractor shall make regular and prompt payment of wages to the labour engaged in the work and in no case should the payment be delayed mere than seven days following the period for which the wages are due. The contractor shall send a certificate to the Purchaser to this effect every month. If it is found that workers are not paid regularly, the contract is liable to the terminated. As a number of contractors may be working at the same time in the erection of different parts of the facilities, there is need for pursuance of a coordinated policy in regard to employment, wages, and other conditions of work. The contractor shall consult the Purchaser on all such matters to arrive at mutually agreed settlements.
7.10 Sanitary Arrangements: The contractor shall comply with all sanitary rules in force and carry out all sanitary measures and permit inspection of all sanitary arrangements at all reasonable times by the Purchaser and or Statutory Authorities.
7.11Infectious Diseases: The contractor shall employ such persons as are found to be free of contagious diseases and shall produce if required by the Purchaser, certificate of fitness of all his employees working at site. The contractor shall, if required by the Purchaser, subject all its employees to regular medical checkup and produce satisfactory evidence of their being free from any contagious disease. The contractor shall remove from its Labour camp such Labour and their families who refuse protective inoculations and vaccination when called upon to do so by any competent authority.
7.12 Use of Intoxicants: The use of sale of ardent spirits or other intoxicating beverages, upon the works or in any of the building, boarding houses, encampments or other tenements owned, occupied by or within the control of the contractor or any of its employees or its sub- contractor is strictly forbidden and the contractor shall secure strict compliance.
7.13 Age Limits of Labour: The contractor shall not employ for the purpose of the work, any person below the age as its statutorily forbidden. The Purchaser shall have the right to refuse to allow any Labour, which the Purchaser considers to be underage to be employed by the contractor. The contractor shall submit periodical statements of Labour employed by the contractor to the Purchaser.
7.14 Provident Fund: The contractor shall be solely responsible for deduction and contributions under the Employees Provident Fund and Family Pension Act, 1952 and the scheme made there under as amended from time to time. The contractor shall be solely responsible for the maintenance of records for payment of contributions and submission of returns in accordance with the said act and scheme
In case the contractor fails to make payments under the above Act and the scheme made there under and as amended from time to time, the Purchaser reserves the right to make such payment on behalf’ of the contractor on demand from the authorities under the Act and recover the same from the payments due to the contractor. Further, tire contractor shall indemnify and keep indemnified the Purchaser against any loss or damage whatsoever that may be suffered by the Purchaser as a result of any claims, damage, penalties for any failure, non-compliance on his part with the provisions of the aforesaid Act and tis: scheme framer there under.
7.15 Observance by Sub-Contractors: The contractor shall also be responsible for the compliance of all the above clauses by. his Sub-contractor(s). All contractors’ equipment brought by the contractor onto the site shall be deemed to be intended to be used exclusively for the execution of the contract. The contractor shall not remove the same from the site without the representative’s consent that such contractor’s equipment is no longer required for the execution of the contract.
7.16Site Regulations and Safety: As the works under the contract are to be carried out within the protected area, the contractor shall abide by all the security regulations promulgated from time to time by the Purchaser/other concerned authorities.
The contractor shall comply with the site regulations, during the execution of the contract at the site. Such site regulations include, but not limited to, rules in respect of security, safety of the facilities, gate control, sanitation, medical care, and fire prevention.
The employees/Labour of the contractor/sub-contractor and plant & equipment brought to site shall be subject to gate pass to be issued by security department or the respective department.
Preparation of gate pass normally takes around 10 days time. The contractor/sub- contractor shall plan their program in advance accordingly.
All representatives and workers of the contractors/sub-contractors shall possess admit pass issued by the security department on the recommendation of the Purchaser. Purchaser shall have the right to refuse pass to any workers or representatives without assigning any reasons.
The contractor shall ensure that gate pass issued to their workers/representatives/sub- contractors by the Purchaser are not misused by unauthorized persons for entry in the plant area or in specified area inside the plant. It shall amount to breach or rules and regulations regarding entry into a prohibited place by the contractors in case any admit pass issued on their demand is found to be misused by unauthorized person.
7.17 Care of Facilities: Any loss or damages that may occur to the facilities or the relevant part thereof from any cause whatsoever during such period. The contractor shall also be responsible for any loss or damage to the facilities caused by the contractor: or its sub-contractors in the course of any work carried out.
Contractor will take out and maintain adequate insurance policies for their personnel and for works executed by then under the contract.
Purchaser shall be indemnified by the Contractor against any violation of the aforesaid Acts and Rules and shall accept the liability for their breach.”

33. Upon perusal of the same, it is made out that Clause 7.3 is imperative for the adjudication of the issue at hand. Plain reading of the said clause makes it clear that the contractor, i.e. the petitioner in the instant case shall be responsible for compliance with the minimum wages and other rules made by the Government.
34. The said clause also makes it evident that the issue of retrenchment, i.e. the illegal termination shall be taken care by the contractor and not the respondent Corporation. Furthermore, the liability of any payment towards such retrenchment was solely to be borne by the petitioner entity and not the respondent Corporation.
35. In view of the foregoing discussions, this Court is of the view the argument of the petitioner that the respondent Corporation is the principal employer of the workman cannot be accepted in light of the explicit language of Clause 7.3 of the above said agreement where the petitioner had itself agreed to compensate its workman in case of retrenchment. Hence, the issue of the liability towards workman is on the petitioner entity in terms of the agreement dated 17th July, 2003.
36. The conditions laid down in the contract signed by the parties makes it amply clear that the petitioner entity had undertaken the responsibility to make payments towards the workman in case of retrenchment, therefore, the arguments advanced by the learned counsel for the petitioner for divisions of the responsibility cannot be accepted at this stage as the petitioner had earlier agreed to be solely responsible for the laborers.
37. Furthermore, the relevant statutory provision, i.e. Section 21 of the Act provides for payment of the wages (if in default) where the contractor shall be held responsible for the same.
38. In the instant case, the learned Court below had rightly held that the petitioner shall be the contractor and therefore, will be liable to pay compensation to the respondent workman.
39. In view of the same, this Court is of the view that the impugned award is correct and therefore, cannot be set aside on the basis of the grounds taken by the learned counsel for the petitioner and therefore, the instant petition is liable to be dismissed.
40. Therefore, in view of the aforesaid discussions of facts and law, it is held that there is no infirmity in the impugned award dated 25th September, 2017 passed in ID No 294/2014, by the Presiding Officer, Labour Court-IX, KKD Courts, Delhi and the same is, hereby, upheld.
41. Hence, the present petition, being devoid of any merits is dismissed, along with pending application, if any.
42. The order be uploaded on the website forthwith

CHANDRA DHARI SINGH, J
JANUARY 31, 2024
SV/AV/RYP

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