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PETITIONER: GAMMON INDIA LTD.  ETC.  ETC.

       Vs.

RESPONDENT: UNION OF INDIA & ORS.  ETC.

DATE OF JUDGMENT20/03/1974

BENCH: RAY, A.N. (CJ) BENCH: RAY, A.N. (CJ) REDDY, P. JAGANMOHAN DWIVEDI, S.N. GOSWAMI, P.K. SARKARIA, RANJIT SINGH

CITATION:  1974 AIR  960            1974 SCR  (3) 665  1974 SCC  (1) 598  CITATOR INFO :  R          1977 SC 747  (7)  RF         1992 SC 457  (7)

ACT: Contract    Labour   (Regulation   and    Abolition)    Act. 1970--Constitutional  validity  of,--Scope  and  application of--Validity of the Rules made under the Act. Interpretation of statutes-ejusdem generis.

HEADNOTE: The  Contract Labour (Regulation and Abolition)  Act,  1970, requires  contractors  to take out licenses.  The  Act  also imposes certain duties and liabilities on the contractor, in respect  of  the workmen employed by the  contractors.   The Contractor is defined as a person who undertakes to  produce a given result for the establishment 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 pending   work  of  construction  amounts  to   unreasonable restriction  on  the  right  of  the  contractors  violating article  19(1)(g)  of  the  Constitution.   It  was  further contented   that  the  fees  prescribed  for   registration, licences,  or renewal of licences amount to a tax  and  are, therefore, beyond the rule-making powers of the Central  and State  Government.   It  was  further  contended  that   the provisions of the Act are unconstitutional and  unreasonable because  of impracticability of implementation.   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) are 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 25(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  principal  employer’s establishment shall be the same.  In case of disagreement it

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is  provided  that the same shall be decided  by  the  Chief Labour   Commissioner   whose  decision  shall   be   final. Rule25(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 Commissioner.  There is no provision for appeal. It was also contended that the provisions in section 14 with regard to forfeiture of security are unconstitutional.   The validity  of rule 24 which requires deposit of Rs. 30/-  per workmen is challenged as void under Articles 14 and 19(1)(f) both  on  the  ground that the same is  arbitrary  and  also because  there is no obligation on the Government to pay  to the  workmen or to utilise for 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 inconsistent with the  provisions of the Act for removal of difficulty is unconstitutional  on the   ground  of  excessive  delegation.    The   intervener challenged  section  28 of the Act conferring power  on  the Government to appoint Inspectors as conferring arbitrary and unguided power. It  was  also  contended  that  the  petitioners  were   not contractors within the meaning 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 establishment 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 circumstances. [671F] (2) The fees prescribedfor   registration,  licences   and renewal  of licenses do not amount to a levy of taxes.   The Government  gives  service  in regard to  the  licences  and registration. [671H] 666 (3)  There is no arbitrary power or excessive delegation  of legislative  authority in regard to-grant of licences.   The Act  and the Rules provide ample guidelines as to the  grant and the terms and conditions of licence.  Section 15 of  the Act confers a right of appeal on any person who is aggrieved by any order refusing a licence or if there is a  revocation or suspension of a licence. [672A-B] (4) The conditions of contract labour has been engaging  the attention  of  various  Committees for  a  long  time.   The benefits  conferred  by  the Act and the  Rules  are  social legislative  measures.   The  various  measures  which   are challenged  as  unreasonable,  namely,  the  provisions  for canteens,  rest  rooms, facilities for  supply  of  drinking water, latrines, urinals, first aid facilities are amenities for  the  dignity of human labour.  The measure  is  in  the interest  of  the  public.  There  is  a  rational  relation between  the impugned Act and the object to be-achieved  and the  provisions  are  not in excess  of  that  object.   The classification  is not arbitrary.  There is no violation  of Article  14.  It is an unproved allegation as to whether  it is  impracticable to provide a canteen.  On the face  of  it

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there  is no impossibility.  Possibility is presumed  unless impossibility   is  proved.   It  is  not  an   unreasonable provision  to  require  a rest room, if  the  labourers  are required  to  halt at night at the place of  work.  [672D-E; 673A] (5) Rule 25(2)(v)(b) contains an explanation which lays down that  while determining the wages and conditions of  service the Chief Labour Commissioner shall have regard to wages and conditions  of  service  in similar  employments.   This  is reasonable.   It  will be question from statute  to  statute from  fact to fact as to whether absence of a provision  for appeal  makes the statute bad.  The Commissioner  of  Labour has special knowledge.  It is not difficult to determine and decide  the questions under rule 25(2)(v)(b).  Absence of  a provision  for appeal is not unreasonable in the context  of the   provisions  in  this  statute.   The  provisions   for forfeiture  of security without provisions for spending  the amount   on  workers  is  constitutionally   valid   because forfeiture amounts to departmental penalty.  The rate of Rs. 30/-  per  workman  does not offend  Article  14.   Further, orders  for forfeiture are appealable and forfeiture  itself is after giving the party reasonable opportunity of  showing cause against the action proposed. [674A-C; 676A] (6)  Section  34  of the Act does not  amount  to  excessive delegation.[676G] (7)  The  Act  was passed to  prevent  the  exploitation  of contract  labour and also to introduce better conditions  of work.   The  underlying  policy of the  Act  is  to  abolish contract labour wherever possible and practicable and  where it  cannot be abolished altogether the policy of the Act  is that the working conditions of the contract labour should be so regulated as to ensure payment of wages and provision  of essential  amenities.   Section  10 of the  Act  deals  with abolition  while the rest of the Act deals mainly  with  the regulation. [669G-A] Since  the  validity  of section 28  was  challenged  by  an Intervener  and not by the petitioners, the  intervener  was not permitted to challenge since an intervener cannot  raise points  which  are not canvassed by the Petitioners  in  the pleadings. [677A] (8)  The  contention of the petitioners that  they  are  not contractors  within  the  meaning of  the  Act  is  unsound. Establishment is understood as including the work site.  The construction  work  which the contractor undertakes  is  the work of the establishment. [669F]

JUDGMENT: ORIGINAL  JURISDICTION : Writ Petition Nos. 202/413/71,  92, 320,  330, 375, 391, 509 & 626-627/72 and  114,  315-316/73, and 1906 or 1973. (Petitions under Article 32 of the Constitution of India). Mr.   G. L. Sanghi and Mr. L N. Shroff for  the  Petitioners (In W.P. Nos. 413/71 509/72) & Intervener No. 2: Mr.   Soli Sorabjee.  Mr. V. M. Tarkundde (In 202/73, Mr.  K S.  Ramamurthi (In 375/72), M/s.  D. R. Thadani (In  375/72) and G. L. Sanghi (in 320/72 & 330/72), with M/s C. M.  Mehta and  B.  R. Agarwala, (Mr.  C. M. Mehta did  not  appear  in 375/72)  for the petitioners (in WPs.  Nos. 320,  330,  375, 391 of 1972 and WP No. 202/73). M/s  S.  K. Mehta, M. Qamaruddin, K. R.  Nagraja  and  Vinot Dhawan for the Petitioners; (In W. Ps.  Nos. 626-27/72. 667 Mr.  Vineet Kumar with M/s.  G. L. Sanghi and S. N.  Trivedi

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(from 21-2-1974) for the Petitioners (in W. P. No. 114/73) Mr.   S.  N. Singh for the Petitioners (In W. P.  Nos.  313- 316/73) Mr.  J. D. Jain, for the Petitioners (In W. P. No. 1906/73) M/s D. K. Singha and K. R. Nambiar, for the Petitioners  (In W. P. No. 92/71) Dr.  L. M. Singhvi with Mr. S. M. Jain  for the Respondent No. I (in W. P. No-. 413/71) Mr.   L.  N.  Sinha, Mr. M. C. Bhandare (for  the  State  of Maharashtra in 320 & 330/73), Mr. K. L. Hathi (for the State of  Gujarat in WP No. 202/71) with M/s.  R. N. Sachthey  and M.  N. Shroff for Respondent No. 2 (In W. P. No.  413/71)  & Respdt.  No. I (In W. P. No. 509/72)    and  (In W.  P.  No. 626-627/72 Respdts.  Nos. 1-2 (In W. P. 202/ 72)  WP.    No. 1906 73, AND 92/71): Mr.  G.B. Pai with Mrs. Urmila Kapoor, Miss Kamlesh  Bansal, and  Mrs’  Shobhna Kikshit for Respdt.  No. 3 (in W.  P.  No 320/72): Mr. R. Ram Reddy with Mr. P. P. Rao for the Respdt. No.  5  (In W. P. No. 202/71).  Mr. S. M. Jain  for  Respdt. No. 3 (In W. P. 202/71) Mr.  R. C. Prasad for Respdt.  No. 8 (In  W. P. 202/71) Mr. A. V. Rangam and Miss  A.  Subhashini for the Respdt.  No. 7 (In W. P. 202/71) M/s Santosh Chatterjee and G. S. Chatterjee for the  Respdt. No. 6 (in W. P. No. 202/71): Mr.   M.  N. Shroff for the Respdt.  No. 10 (In  W.  P.  No. 202/71): Mr.  L N. Shroff for the Respdt.  I I (In W. P. No. 202/71): Mr.  Veerappa for the Respdt. 12 (In W. P. No. 202/71) M/s G. Dass and B. Parthasarthi for the Respdt. 13 (in W. P. No. 2,02/71) Mr.P. Ram Reddy with P. P. Rao for the  Applicant/Intervener ,,(The State of Andhra Pradesh in W. P. 413/71) M/s.  Sharad Manohar, B. P. Maheshwari and Suresh Sethi  for intervener No. 1 (K.  C. Agarwala) Mr.  B. R. Agarwala for Intervener Nos. 3 & 4 (Gammon and Y.   V. Narayanan. ) Mr. N. N. Keshwani for intervener No. 5 (Gujarat  Contractor Assn.) The Judgment of the Court was delivered by RAY,  C.  J.  These  petitions  under  Article  32  of   the Constitution  challenge the validity of the Contract  Labour (Regulation and Abolition) Act, 1970 referred to as the  Act and  of  the  Contract  Labour  (Regulation  and  Abolition) Central  Rules  and  Rules of the States  of  Rajasthan  and Maharashtra. The  petitioners  carry on the business of  contractors  for construction of roads, buildings, weigh bridges and dams. The Act requires contractors to take out licences.  The  Act also   imposes  certain  duties  and  liabilities   on   the contractors. The Act defines in section 2 (c) a "contractor" in  relation to  an  establishment  to mean a person  who  undertakes  to produce a given 668 result  for the establishment, other than a mere  supply  of goods  or  articles of manufacture  to  such  establishment, through contract labour or who supplies contract labour  for any work of the establishment and includes a sub-contractor. The   other  definitions  relevant  to  the  meaning  of   a contractor   are  establishment,  principal   employer   and workmen. "Establishment" as defined in section 2 (e) of the Act means (i)  any office or department of the Government or  a  local authority,  or  (ii) any place where  any  industry,  trade, business, manufacture or occupation is carried on. "Principal employer" as defined in section 2 (g) of the  Act means  (i)  in relation to any office or department  of  the

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Government or a local authority, the head of that office  or department  or such other officer as the Government  or  the local  authority,  as the case may be, may specify  in  this behalf,  (ii)  in a factory, the owner or  occupier  of  the factory and where a person has been named as the manager  of the  factory  under the Factories Act, 1948, the  person  so named,  (iii) in a mine, the owner or agent of the mine  and where  a person has been named as the manager of  the  mine, the  person so named, and (iv) in any  other  establishment, any  person responsible for the supervision and  control  of the establishment. "Workman" is defined in section 2 (i) of the Act to mean any person  employed  in or in connection with the work  of  any establishment  to do any skilled, semi-skilled or  unskilled manual, supervisory, technical or clerical work for hire  or reward,  whether  the  terms of employment  be  express  or- implied. Section  2  (b) of the Act states that a  workman  shall  be deemed  to  be  employed  as  "contract  labour"  in  or  in connection  with  the work of an establishment, when  he  is hired  in  or in connection with such work by or  through  a contractor,  with or without the knowledge of the  principal employer. The  petitioners  contend  that they  are  not  contractors- within the definition of the Act.  They advance two reasons. First,  the work of the petitioners is not any part  of  the work  of  the  principal employer nor is  it  the  work  "in connection  with  the work of  the  establishment",  namely, principal employer.  Second, the work of the petitioners  is normally not done in the premises of the "establishment"  of the principal employer. Relying  on  the definitions. counsel  for  the  petitioners contended  that  establishment  means any  place  where  any industry,  trade,  business, manufacture  or  occupation  is carried  on  and,  therefore, the workmen  employed  by  the petitioners  are  not contract labour because they  are  not employed  in connection with the work of the  establishment. The   work  of  the  establishment  is,  according  to   the petitioners,  not  only  at the place  where  the  business, trade, industry of the establishment is carried on but  also the   actual   business  or  trade  or   industry   of   the establishment.   The  entire  emphasis  is  placed  by   the petitioners  on the words "work ’of any  establishment."  By way  of  illustration it is said that if a  banking  company which is an establish- 669 ment  which  carries on its business at  Delhi  employs  the petitioners  to  construct  a  building  at  Allahabad   the building to be constructed is not the work of the bank.   It is  said that the only work of the bank as an  establishment is banking work and, therefore, the work of construction  is not  the banking work of the establishment.  Therefore,  the petitioners  contend  that  the  workmen  employed  by   the petitioners  are not workmen in connection with the work  of the establishment. The  contention  of the petitioners is  unsound.   When  the banking  company  employs  the petitioners  to  construct  a building   the   petitioners   are  in   relation   to   the establishment  contractors who undertake to produce a  given result  for the bank.  The petitioners are also persons  who undertake  to  produce the result through  contract  labour. The petitioners may appoint sub-contractors to do the  work. To   accede   to  the  petitioners’  contention   that   the construction  work  which Is away from the place  where  the industry, trade, business of the establishment is carried on

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is not the work of the establishment is to render the  words "work of any establishments devoid of ordinary meaning.  The construction  of the building is the work of the  establish- ment.   The building is the property of  the  establishment. Therefore,  the  construction  work  is  the  work  of   the establishment.   That  is  why a workman  is  deemed  to  be employed  as contract labour in connection with the work  of an  establishment.   The  place where business  or  rade  or industry  or manufacture or occupation is carried on is  not Synonymous  with  "the, work of the  establishment"  when  a contractor  employs contract labour in connection  with  the work  of  the establishment.  The error of  the  petitioners lies  in  equating the work of the  establishment  with  the actual  place  where  the business,  industry  or  trade  is carried on and the actual work of the business, industry  or trade. It  is plain that industry, trade, business, manufacture  or occupation  is to expand.  In connection with the  expansion of  establishment,  buildings  are  constructed.   The  site chosen   for   the  building  is  the  work  site   of   the establishment.   The  work  site  is  the  place  where   on completion   of   construction,   the   business   of    the establishment  will be carried on.  Therefore, the  work  at the  site as understood in the definition is the work of  an establishment-.   Establishment is understood  as  including the  work site.  The construction work which the  contractor undertakes is the work of the establishment. The  Act was passed to prevent the exploitation of  contract labour and also to introduce better conditions of work.  The Act  provides  for  regulation  and  abolition  of  contract labour.   The  underlying policy of the Act  is  to  abolish contract  labour,  wherever possible  and  practicable.  and where  it cannot be abolished altogether, the policy of  the Act  is that the working conditions of the  contract  labour should  be  so regulated as to ensure payment of  wages  and provision  of  essential amenities’.  That is  why  the  Act provides  for regulated conditions of work and  contemplates progressive abolition to the extent contemplated by  section 10  of the Act.  Section 10 of the Act deals with  abolition while the rest of the Act deals mainly with regulation.  The dominant  idea of the section 10 of the Act is to  find  out whether 670 contract  labour  is  necessary  for  the  industry,  trade, business,  manufacture or occupation which is carried on  in the establishment. The  Act in section 10 empowers the Government  to  prohibit employment  of  contract labour in any  establishment.   The Government  under  that  section has to apply  its  mind  to various   factors   before  the  Government   prohibits   by notification in the official gazette, employment of contract labour  in  any  process, operation or  other  work  in  any establishment.  The words "other work in any  establishment" in section 10 of the Act are important.  The work in the es- tablishment will be apparent from section 10 (2) of the  Act as incidental or necessary to the industry, trade, business, manufacture  or  occupation  that  is  carried  on  in   the establishment.  The Government before notifying  prohibition of  contract  labour  for work which is carried  on  in  the establishment  will  consider  whether  the  work  is  of  a Perennial  nature  in  that establishment or  work  is  done ordinarily,  through regular workmen in that  establishment. The  words  "work of an establishment " which  are  used  in defining  workmen  as  contract  labour  being  employed  in connection  with the work of an establishment indicate  that

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the work of the establishment there is not the same as  work in the establishment contemplated in section 10 of the Act. The  words "other work in any establishment" in  section  10 are  to  be, construed as ejusdom generis.   The  expression "other  work" in the collection of words process,  operation or other work in any, establishment occurring in section  10 has  not the same meaning as the expression  "in  connection with  the work of an establishment", spoken in  relation  to workmen or contractor. A  contractor under the Act in relation to an  establishment is a person who undertakes to produce a given result for the establishment  through contract labour.  A contractor  is  a person  who  supplies contract labour for any  work  of  the establishment. The entire context shows that the work of the establishment  is  the  work  site,  The  work  site  is  an establishment and belongs to the principal employer who  has a right of supervision and control., who is the owner of the premises  and  the end product and from  whom  the  contract labour  receives  its payment either directly or  through  a contractor  It is the place where the establishment  intends to  carry  on its business,  trade,  industry,  manufacture, occupation after the construction is complete. According  to the petitioners, the contract labour  employed by  their sub-contractors will be within the  provisions  of the Act but when the petitioners will be engaged by a trade, or  industry, the petitioners will not be a  contractor  and the workmen directly emPloyed by the petitioners will not be contract   labour.   This  is  a  strange,   and   anomalous submission.  The Act must be construed as a whole.  The  Act must apply to contract labour in connection with the work of an  establishment when the contract labour is hired  by  the contractor or by the sub-contractor of the contractor. 671 The  expression  "work of an establishment" means  the  work site  where  the construction work of the  establishment  is carried on by the petitioners by employing contract  labour. Every clause of a statute is to be construed with  reference to  the  context and other provisions of the Act to  make  a consistent and harmonious meaning of the statute relating to the subject matter.  The interpretation of the words will be by looking at the context, the collocation of the words  and the  object  ’of  the words relating to  the  matters.   The ’words are not to be viewed detached from the context of the statute.   The  words are to be viewed in  relation  to  the whole  context.   The  definition  of  contractor,  workman, contract  labour,  establishment,  principal  employer   all indicate  that the work of an establishment means  the  work site  of the establishment where a building  is  constructed for the establishment.  The construction is the work of  the establishment.  The expression "employed in or in connection with  the work of the establishment" does not mean that  the operation  assigned  to  the  workmen  must  be  a  part  or incidental to the work performed by the principal employer.. The  contractor is employed to produce the given result  for the  benefit of the principal employer in fulfilment of  the undertaking given to him by the contractor.  Therefore,  the employment  of the contract labour, namely, the  workmen  by the  contractor  is  in  connection with  the  work  of  the establishment.   The petitioners are contractors within  the meaning  of  the  Act.   The  work  which  the   petitioners undertake is the work of the establishment. The  second contention on behalf of the petitioners is  that the provisions of the Act and the Rules made thereunder  are unconstitutional. It  is  said that the application of the Act in  respect  of

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pending   work  of  construction  amounts  to   unreasonable restriction on the right of the contractors under Article 19 (1) (g).  The bill was introduced in 1967.  It was passed in 1970,  There  is no unreasonableness in that it  applies  to pending  contracts.  The pendency of cont is not a  relevant consideration.  The subject-matter of the legislation is not contract. it is contract labour.  There is no  retrospective operation.   There  are  no  materials  to  show  that   the petitioners will suffer.  The contractors have not shown the contracts  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 circumstances.   That  is usual  in contracts.  The petitioners during the years  1967 to 1970 knew that the legislative measure was going to  find place  in the statute book.  The crucial point is  that  the interests of the workmen are remedied by the objects of  the Act.  Those interests are minimum labour welfare.  There  is no unreasonableness in the measure. The fees prescribed for registration, licence or renewal  of licences  are  said  to amount to a tax  and  are  therefore beyond  the  rule-making  powers of the  Central  and  State Governments.  The fees prescribed for registration,  licence and renewal of licences do not amount to a levy of tax.  The Government has to bear expenses for the scheme 672 of  registration, licence.  The Government gives service  in regard  to licences and registration.  Further there  is  no arbitrary  power  or  excessive  delegation  of  legislative authority  in regard to grant of licence.  The Act  and  the Rules provide ample guideline as to the grant and terms  and conditions  of  licence.  Section 15 of the  Act  confers  a right of appeal on any person who is aggrieved by any  order refusing  a licence or if there is revocation or  suspension of   licence.   Similarly,  when  there  is  revocation   of registration  of  an establishment or there  is  refusal  to grant registration there is a right of appeal. Counsel for the petitioners contended that the provisions of the  Act  are unconstitutional and unreasonable  because  of impracticability of implementation.  Provisions in regard to canteens, rest rooms,. latrines and urinals as  contemplated in sections 16 and 17 of the Act read with Central Rules  40 to  56  and  Rule 25 (2) (vi) are said to  be  incapable  of implementation  and  also to be enormously expensive  as  to amount  to  unreasonable restrictions under Article  19  (1) (g).   No provision of the Act is impeached on that  ground. The attack is only with regard to rules. The  condition  of  contract labour has  been  engaging  the attention  of  various  committees for  a  long  time.   The benefits  conferred  by  the Act and the  Rules  are  social welfare  legislative measures.  The various  measures  which are  challenged as unreasonable namely, the  provisions  for canteens,  rest  rooms, facilities for  supply  of  drinking water,   laterines,  urinals,  first  aid   facilities   are amenities  for the dignity of human labour.  The measure  is in the interest of the public. it is for the legislature  to determine  what is needed as the appropriate conditions  for employment  of  contract labour.  It is  difficult  for  the Court  to impose its own standards of  reasonableness.   The legislature  will  be  guided by the needs  of  the  general public   in   determining   the   reasonableness   of   such requirements.   There  is a rational  relation  between  the impugned Act and the object to be achieved and the provision is  not in excess of that object.  There is no violation  of Article  14.   The  classification is  not  arbitrary.   The legislature has made uniform laws for all contractors.

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Section  16  of the Act confers power on the  Government  to make  rules  that in every establishment to  which  the  Act applies  wherein  contract labour numbering one  hundred  or more  are  employed by a contractor, one  or  more  canteens shall  be provided and maintained by the contractor for  the use  of such contract labour.  Rule 42 relates  to  canteens and  Rule 43 relates to dining halls.  Rule 42  states  that where  the  contract labour is likely to  continue  for  six months  or more and wherein the contract labour numbers  100 or  more, a canteen shall be provided as mentioned  therein. This rule indicates that where a fairly stable work goes  on for  six months and the number of labour is 100 or  more,  a canteen is to be provided. It  is said that it is difficult to find space in Bombay  to provide for canteens.  It is also said that if a road is  to be constructed, it will be difficult to provide canteen.  It is  said on behalf of the respondents that a provision  for- canteen is capable of performance whether in 673 a city orin  a  desert.   On the face of it,  there  is  no impossibility. Possibilityis       presumed       unless impossibility is proved. it is an unproved allegationas to whether  it is impracticable to provide a canteen. When  the construction  work goes on, the contractor will devise  ways and  means to provide a canteen.  The provision for  canteen is  not  unreasonable.  It is not impracticable  to  have  a canteen.  A city like Bombay or the construction of road  is not an insurmountable feature by itself to hold either  that the provision is unreasonable or impracticable. Section  17  of  the Act states that in  every  place  where contract  labour is required to halt at night in  connection with the work of the establishment, there shall be  provided a  rest room as mentioned therein.  Rule 41 of  the  Central Rules  states  that  where  contract  labour  is  likely  to continue for three months or more and where contract  labour is required to halt at night, rest rooms shall be  provided. It is not unreasonable to provide rest room.  The contractor will  make necessary provision.  It will be unreasonable  to hold  that a labourer will be required to halt at  night  at the place of work but he will not have any rest room. Section  18 of the Act speaks of facilities like  supply  of drinking  water,  conveniences  of  laterines,  urinals  and washing  facilities.  Rule 51 carries out the  provision  of the  Act by stating that laterines shall be  provided.   The reasonableness as well as practicability of these facilities is indisputable. It is said that the provisions contained in Rule 25 (2) (ii) are  unreasonable because the licence states the  number  of workmen employed and if the contractor is required to employ a larger number, the contractor will commit a breach of  the condition.  The answer is simple.  The contractor will  take steps  to amend the licence.  Sections 23 and 24 of the  Act which  speak  of contravention of provisions  regarding  the employment  of  contract labour will be interpreted  in  the light  of  section 14 (1) (b) of the Act as to  whether  the holder of a licence has, without reasonable cause, failed to comply  with  the  condition of the licence.   If  there  is wrongful refusal of amendment, that is appealable under  the Act. The provisions contained in Central Rule 25 (2) (v) (b)  are challenged as unreasonable.  Rule 25 (2) (v) (a) states that wages,  conditions  of  service of workmen who  do  same  or similar kind of work as the workmen directly employed in the principal  employer’s establishment shall be the  same.   In case  of  disagreement with regard to type of  work,  it  is

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provided that the same shall be decided by the Chief  Labour Commissioner  whose decision shall be final.  Rule  ’25  (2) (v)  (b)  states  that  in other  cases,  the  wages  rates, holidays  and  conditions of service of the workmen  of  the contractor  shall be such as may be specified by  the  Chief Labour Commissioner.  There is an explanation to this clause that while determining wages and conditions of service under Rule 25 (2) (v) (b) the Chief Labour Commissioner shall have regard  to  wages and conditions of service in  similar  em- ployment.  This is reasonable. 674 The complaint against Rule 25 (2) (v)(b) is that there is no provision for appeal.  It is not difficult to determine  and decide  cases of this type.  The Commissioner of Labour  has special  knowledge.  It will be a question from  statute  to statute,  from  fact  to fact as to  whether  absence  of  a provision for appeal makes the statute bad.  The  provisions contained  in Rule 25 (2) (v) (b) refer to wages,  hours  of work  and  conditions of service in similar  employment.   A provision for appeal is not inflexible.  The issue is simple here.   A  long drawn procedure may exceed the  duration  of employment  of the workmen.  A proper standard is laid  down in the explanation to Rule 25 (2) (v) (b).  The absence of a provision  for appeal is not unreasonable in the context  of provisions here.  The Commissioner shall have due regard  to the wages of workmen in similar employment.  The parties are heard  and  the Commissioner of Labour who  is  specifically acquainted   with   the  conditions,  applies   the   proper standards.  There is no unreasonableness in the Rules. The  petitioners  contended  in the  third  place  that  the provisions contained in section 14 of the Act with regard to forfeiture of security are unconstitutional.  Section 12  of the  Act  provides  that no contractor  shall  undertake  or execute  any  work except in accordance with a  licence  and further that licence shall be issued on payment of fees  and on deposit of a security for the due performance of the con- ditions  as  may  be  prescribed.  Section  14  of  the  Act provides  that  if  a licensing officer is  satisfied  on  a reference  made  to him or otherwise that the  holder  of  a licence has, without reasonable cause failed to comply  with the conditions subject to which the licence has been granted or has contravened any of the provisions of this Act or  the Rules  made thereunder then without prejudice to  any  other penalty  to  which the holder of the licence may  be  liable under  the Act the licensing officer may, after  giving  the holder  of  the licence, an opportunity  of  showing  cause, revoke or suspend the licence or forfeit the sum, if any, or any  portion  thereof  deposited as  security  for  the  due performance  of the conditions subject to which the  licence has  been granted.  Rule 24 of the Central Rules relates  to security.   Maharashtra and Rajasthan Rules contain  similar provisions.  Rule 24 of the Central Rules provides that  the security amount of Rs. 30/- for each of the workmen is to be deposited  as  security  for  the  due  performance  of  the conditions of licence and compliance with the provisions  of the Act or the rules made thereunder. On  behalf of the petitioners it is said that Rule 24  which fixes the fee of Rs. 30/- per workman is void under Articles 14 and 19 (1) (f) because it is an arbitrary sum.  Secondly, it is said that there is no obligation on the Government  to pay to the workmen or to utilise for the workmen any part of the security deposit so forfeited.  Thirdly, it is said that the breach of the conditions of licence or provision of  the Act  is  made punishable under the penal provisions  of  the Act,  viz. section 24 and yet Rule 24 unreasonably  provides

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for  the forfeiture of deposit.  Fourthly, it is  said  that any  breach regarding the welfare of the workmen apart  from being  penal  is  safeguarded by the  requirement  that  the principal employer would perform the obligation and 675 recover the amount from the contractor.  Fifthly, section 20 of  the  Act provides that where the  benefit  for  contract labour  is  not provided by the  contractor,  the  principal employer  may provide the same and deduct the expenses  so incurred from  amounts payable to the contractor.  Sixthly, it is said that theprovision   regarding   forfeiture   of’ deposit has no rational connection between   the    sum required to be deposited and the number of workmen nor  does the  same have rational nexus with the object sought  to  be achieved  since the Government is not bound to  utilise  the amount  for  workmen, concerned.  Finally, it is  said  that Article 14 is violated because it will work harshly  against medium  and weaker class of contractors who have to  deposit substantial  amounts  before  getting  a  contract  and  who further  have to go on leaving in deposit with  the  Govern- ment substantial amounts.  The security is characterised  by the petitioners as forced loan without interest. The  relevant  Central  Rules  with  regard  to  deposit  of security are Rules 24 and 31.  Rule 24 provides for  deposit of security at the rate, of Rs. 30/- per workmen for the due performance of the conditions of the licence and  compliance with the provisions of the Act or the rules made thereunder. Rule  31 states that if the licensing officer is,  satisfied that  there  is no breach of the conditions  of  licence  or there  is  no  order under section 14 of  the  Act  for  the forfeiture  of  security or any portion  thereof,  he  shall direct  the  refund of the security.  If there is  an  order directing  the  forfeiture of any portion  of  the  security deposit-  the  amount forfeited shall be deducted-  and  the balance, if any, refunded.  The forfeiture under section  14 (2) of the Act is for failure to comply with the  conditions subject to which the licence is granted or contravention  of the provisions of the Act or the rules made thereunder. The forfeiture of deposit under section 14 of the Act may be for the, entire sum or any portion thereof.  The  forfeiture may be for the purpose of due performance of the  conditions of the licence or for contravention of any provision of  the Act  or  Rules  made  thereunder.  If  any  portion  of  the security  is forfeited, it is in relation to the  extent  of infraction  or  the degree of due performance which  may  be required.    The   security  is  utilisable  for   the   due performance  of  the obligations or which  the  security  is taken.    The  words  "for  the  due  performance   of   the conditions,  subject to which the licence has been  granted" are descriptive of the security.  The conditions of  licence appearing  in  Form No. VI are that the licensee  shall  not transfer  the licence and rates of wages shall be  not  less than the rates prescribed under the minimum Wages Act.   The other  conditions  are with regard to hours  of  work,  wage rates  and  holidays and conditions of service  as  may  be- specified by the Labour Commissioner.  These are some of the principal conditions.  The provision for forfeiture  without provision   for   spending   the  amount   on   workers   is constitutionally  valid because .the forfeiture  amounts  to departmental  penalty.   Forfeiture means  not  merely  that which is actually taken from a man by reason of some  breach of condition but includes also that which becomes liable  to be so taken as a penalty. 676 The rate of Rs. 30/- per workman does not offend Article 14.

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The rate is relatable to the classification of big and small contractors  according to the number employed by  them.   No additional burden is imposed by the rules. Further  orders for forfeiture are  appealable.   Forfeiture itself  is after giving the party reasonable opportunity  of showing  cause against "the action proposed.   Secondly  the condition  of forfeiture is that the failure to comply  with the  condition is without reasonable cause.  The  provisions of the Act with regard to forfeiture do not suffer from  any constitutional  infirmity.  The rules are  not  inconsistent with the provisions of the Act.  The forfeiture of  security is for due performance or as a penalty on the licensee.  The order  for  forfeiture is an  administrative  penalty.   The provisions  contained  in  sections  23 to  26  of  the  Act indicate  that  contravention of  the  provisions  regarding employment  of  contract labour is  punishable  in  Criminal Court.   The Licensing Officer tinder section 14 of the  Act is  not  a Court.  Therefore, there is no aspect  of  double jeopardy. Section  34 of the Act was challenged  as  unconstitutional. Section 34 of the Act provides that if any difficulty arises in giving effect ’to the provisions of the Act, the  Central Government may, by order, published in the official gazette, make such provisions not inconsistent with the provisions of the  Act as appears to it to be necessary or  expedient  for removing   the   difficulty.    Reliance   was   placed   by ’petitioners on the decision of this Court in Jalan  Trading Co.  v.  Mazdoor  Union  reported in  [1967]  1  S.C.R.  15. Section 37 of the Act in that case authorised the Government to  provide by order for ,removal of doubts or  difficulties in  giving effect to the provisions of the Act.  This  Court held  that it is for the legislature to make provisions  for removal of doubts or difficulties. The section in that  case ,contained   a  provision  that  the  order  must   not   be inconsistent   with  the  Purposes  of  the  Act.    Another provision  in the section made the order of  the  Government final.  This Court held that in substance there was the vice of  delegation of legislation to executive  authority.   Two reasons  were  given.   First  the  section  authorised  the Government to determine for itself what the purposes of  the Act  were  and to make provisions for removal of  doubts  or difficulties.   Second,  the Power to remove the  doubts  or difficulties by altering the provisions of the Act would  in substance  amount to exercise of legislative authority  ,and that  could not be delegated to an executive authority.   In the  Present  case,  neither  finality  nor  alteration   is contemplated  in  any  Order under section 34  of  the  Act. Section  34  is for giving effect to the provisions  of  the Act.   This  provision  is an application  of  the  internal functioning  of the administrative machinery.   Difficulties can  only arise in the implementation of rules.   Therefore, section  34  of  the  Act  does  not  amount  to   excessive delegation. Section 28 of the Act was challenged as conferring arbitrary and  unguided power and, therefore violative of Articles  14 and  15.   Section  28  of the  Act  confers  power  on  the Government to appoint persons 677 as  it thinks fit to be the inspectors for the  purposes  of the Act and such inspector shall have power to enter at  all reasonable hours the premises or place where contract labour is  employed  for the purpose of examining any  register  or record  or notice and examine any person and seize, or  take copies  of  documents  mentioned therein.   When  they  have reasons to believe that an offence has been committed,  they

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can  seize  or  take copies.  This point was  taken  by  the Intervener.   An. intervener cannot raise points  which  are not canvassed by the petitioners in the pleadings. For these reasons, the contentions of the petitioners  fail. The  petitions  are dismissed.  Parties will  pay  and  bear their own costs. P.H.P.                       Petitions dismissed. 678