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Dear Members,
Kindly supplement your guidance on B&OCW. A factory is under commercial production. The said factory is going for an additional unit in same boundary & premises. The labour department asking to the agency to have registration for this new job. The labour department not convinced at all, that the said act is not applicable to the unit. But they are citing example of the Apex court decission in the matter of Lanco Anpara power plant case.
Regards
From India, Mumbai
Dear Prabhat ji,
In light of recent landmark judgement of the Hon'ble Supreme Court in Lanco Anpara Power v/s State of Uttar Pradesh & Ors rendered in Civil Appeal No 6223 of 2016 (reported in (2016) 10 SCALE 99), unfortunately you can not take the benefit of exclusion carved out under Section 2(1)(d) of the BOCW Act. Now you have no option but to obtain Registration Certificate under BOCW Act and also to pay Cess.
The Hon'ble SC, while coming to its conclusion, adopted a purposive interpretation to Section 2(1)(d) of BOCW Act giving primacy to the 'superior purpose' contained in the BOCW Act and the Welfare Cess Act, such purpose being the welfare of the unorganised labour class involved in construction activity. The Hon'ble SC further held that a literal interpretation as desired by the construction companies would result in a situation where the construction workers would be deprived of the benefits of both the BOCW Act and the Factories Act, which could not have been the legislative intent and therefore could not be accepted by the Courts.
From India, Mumbai
Dear Keshav Korgaonkar Ji,
I appreciate and thanks you for the comments over the matter and suggestion there too. I have gone through the judgement of the Hon'ble Supreme Court in Lanco Anpara Power v/s State of Uttar Pradesh & Ors rendered in Civil Appeal No 6223 of 2016 (reported in (2016).
The judgement has offered in the matter of Green Field projects, whose plans and layout got approved under the Factories but not started commercial production.
In totality the said judgement has construed to give an interpretation of Factory. Further it clearly clarified that ' A Factory" under construction can not be treated as Factory and B&OCW is applicable. I have minutely gone through the judgement and landed in an opinion that the B&OCW Act is not applicable to Factory under commercial production. This opinion is based upon the points discussed in Judgement i.e. Point No:11 page No-15
Point No:19 page No-23
Point No:23 page No-24-25
Point No:25 page No-26
Would you take little pain to go through the above points of the judgement for an opinion and construction.
Thanks and Regard
From India, Mumbai
Thanks Prabhat ji for giving insights of the judgment, which I have not fully read, I admit.
I only know that the Hon'ble SC, while coming to its conclusion, adopted a purposive interpretation to Section 2(1)(d) of BOCW Act giving primacy to the 'superior purpose' contained in the BOCW Act and the Welfare Cess Act, such purpose being the welfare of the unorganised labour class involved in construction activity.
Good that you responded to me. I will have to not only read this judgment fully but study it minutely.
From India, Mumbai
Dear Prabhat: I endorse your views. The Lanco judgement would apply only in case of green field projects and it is distinguishable for expansion of activities in an already established factory. Indeed the very purpose of BOCW Act is to provide welfare amenities to the building and construction workers which they are deprived off via-a-vs factory workers because of the unorganised nature of work. But once a factory is in operation, all statutory benefits like medical, canteen, PF,ESI etc are extendable to all including the Building & Construction Workers deloyed in the same premses. Reading Lanco Judgement as providing for coverage under BOCW Act would be unnecessary duplication of liability without any gain.
From India, Mumbai
I offer my thanks for giving your valueable opinion by learned members of the forum Shri Korgaonkar Ji and Shri KK-HR.
Regards
From India, Mumbai
In BOCW act, its difficult to convince labour department and interpretation of supreme court judgement also favouring their side. So, opt to go for STAY from high court because appeal at labour commissioner will go in their favour .
From India, undefined
Dear Mr. Singh,
Thanks for your opinion. Do you know there were some 20-25 cases were set aside by this single verdict of the Apex Court, which was pending for past 7-8 years. All these cases High Court gave verdict in favour of B&OCW and subsequently challenged before the Apex Court.
At this present juncture No High Court would dare to accept the case, even they know the matter is different than of the previous. This is our Judiciary dilema to wrap all under one blanket even they know it can't be.
Regards
From India, Mumbai
You are right Mr Prabhat , high court closed number of cases in single verdict after Oct'2016 but still few cases in stay status. May be this is only the way to exempt from recovery in expansion cases.
From India, undefined
Yes Mr. Singh,
The cases might be of New Factory under construction were closed. But the cases not of similiar nature is maintaining stay status. We have already intimated our views to Inspector-cum-enforcement officer under B&OCW and to the principal employer to reimburse the cost as we have not considered cess in our price quotation, as it is Factory.
Regards.
From India, Mumbai
Dear All
Kindly go through the judgment of Bombay High Court in case of Wardha Power Company Ltd vs State of Maharashtra reported in 2017 (1530 FLR 139 and the judgment of Madhya Pradesh High Court in case of Vippy Industries Ltd. vs Assessing Officer reported in 2017 (153) FLR 951. Both these judgments are by Division Bench wherein the matters related to existing factroy and the applicability of BOCW Act. This should clarify the issue.
Thanks
S. Sensharma
Industrial Law Consultant, Meerut
From India, undefined
Dear Shri Sensharma,
I appreciate & offer my thanks for bringing the facts to my knowledge.
Regards
From India, Mumbai
Dear Prabhat: The judgements of High Court are contradictory. While in Vippy Industries, the MP High Court clearly holds that the BOCW Act would apply even if the construction is in the existing Factory premises, in Wardha Power, the Bombay High Court answers "... after manufacturing process starts, the work on a factory building or any other civil work therein which can be subjected to provisions of Factories Act 1948, shall not attract provisions of Act No.27/1996 or the Cess Act."
Both the judgements are of the Division Bench,MP High Court is the later one but the Bombay judgement was not considered. So the issue is still open.I think the final word can be said only after the Supreme Court decides the issue. I think there is strong case in favour of exclusion of liabiliy.
From India, Mumbai
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