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A Government Company “X” wants to construct a public road on Government’s land which will give approach to its factory. The road shall also be used by public as well. Since the road to be constructed is a public road, so its ownership shall vest with Government’s public work department (PWD).
For the construction of road on 100% contribution basis, company “X” approaches PWD. PWD accepts the offer and makes an estimate of Rs. 50 Cr. Company “X” deposits Rs. 50 Cr with PWD with a condition that in case of final cost of project exceed the estimated amount, Company “X” shall deposit extra amount to cover the deficit and vice versa.
As per the term of contract, Company “X” shall not have any control over road construction work i.e. no control over road completion time, drawing and design, construction site, sub-contractor, material procurement, manpower and quality of construction etc. Even after construction, the road shall be owned by PWD and not by Company “X”
The PWD then prepares DPR/drawing design and issues contract to contractor. The contractor completes the work at Rs. 45 Cr. Finally Rs. 5 Cr is returned to Company “X” by PWD.
My Question is: - Who is employer in the above case?
(Note: Facts to be considered while framing opinion: - Company “X” is a Government Company; PWD is also a Government Department. Only sub contractor is a private firm. The important thing is this that Government Company has no control over road completion time, drawing and design, construction site, sub-contractor, material procurement, manpower and quality of construction etc.)

"contractor completes the work in 45 cr," means the value of work is not fixed for the construction company, so the establishment / person / body made the road is not a contractor but a construction service provider, and issue invoice on their cost to cost basis.
Here the employer is construction company, as he has sold the goods and services to PWD and PWD sold the same to company X , there is absolutely no works contract in whole transaction
This is my own finding, may be different on actual ground subject to study of whole document

My dear,
In the given facts the "Employer" is the company X. The employer has to clear the terms and conditions of payment of government taxes in time, in every contract, otherwise, as a principal Employer, he has paid all dues in time.
Thanks

As per your question : -
1. PWD is the principal employer as he has offered/ issued work order to the contractor for construction of road.
2. The contractor who carried out the job is employer as per the B&OCW and has to pay the cess to Govt. as he has engaged the workmen to do the task.
Company “X” is out of frame as the land & road does not belong to them, neither they issued any work order for the work.

Under BOCW (RE & CS) Act, 1996 there is no definition of Principal employer. There is definition of Contractor and Employer. Therefore as per definition of employer under the Act, the contractor who is engaged by the PWD is the 'employer' . Contractor has to take registration under the Act from the Registering authority under State Govt and has to deposit Cess with the State Govt . The Collection of cess and its utilisation is entirely with State Government eventhough the work is allotted by the company owned by Central Govt.
Therefore the answer to the above question is Contractor is the Employer.

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