Is BOCW Cess Required for O&M Contractors in Registered Factories? Seeking Clarity

Dear Sir(s), I am new to this forum. I would like to seek the valuable advice of the experts in this field regarding the details mentioned below. I have seen other queries related to BOCW posted here but could not find any suitable ones for our requirements.

Operations & Maintenance Company and BOCW Act

We are an Operations & Maintenance company for power plants. Due to the nature of power generation and repair works, I understand that we are covered under the BOCW Act for cess payment. However, we operate the stations (buildings) that are already established and covered under the Factories Act by our principal employer. In this case, are we required to pay cess under the BOCW Act?

We are not an EPC company and do not carry out any construction activities. Our work involves operating and maintaining the existing machinery/buildings that are covered by the Factories Act through our principal employer.

Compliance and Cess Payment

We are being asked to pay the cess, and I would appreciate it if someone could provide clarity on the compliance required. Also, how is the O&M company covered under the Factories Act 1948?

Thanks in advance.

Section 2(d) of the act itself explains that any area covered under the Factories Act '48 (geographically demarcated by the Factory Plan approved by the Directorate of Factories) will not be covered by the BOCW (RECS) Act. Construction jobs in areas other than the Factory Area of the same organization will attract the provisions of the BOCW (RECS) Act.

Hope this helps.

Thanks and regards,

Dear Mr. Arunoeg,

Understanding BOCW Act and Cess Payment

1. With regard to your understanding, "We are an Operations & Maintenance company of power plants. As a power-generating station and repair works nature, I understand we are covered under the BOCW act for cess payment," I am of the opinion that you are not required to pay cess for repair works. The question is, where do you carry out the maintenance or repair work? I hope it is within the factory premises, which is covered under the Factories Act as per the approved factory plan.

2. Again, the Factories Act is not covered under the BOCW (RECS) act.

Clarification on Principal Employer and BOCW Act

3. Regarding "We are not an EPC company and we do not carry out any constructional activities. We operate and maintain the existing machinery/buildings, which are covered by the Factories Act by our principal employer," as per the BOCW act/rules, there is no concept of a principal employer. All entities, including the principal employer under CLRA '70 who is the owner/occupier of the establishment, and the contractors engaged in BOCW works with a value of more than 10 lakh per order, are referred to as "employer."

However, if the BOCW job to be executed is within the factory premises, within the boundary of the approved factory under the Factories Act, there is no question of the application of the BOCW act or rules framed thereunder. The normal safety, social security, and welfare provisions of the CLRA Act, Factories Act, Workmen's Compensation Act, PF, etc., except BOCW, will be applicable.

Regards

Thank you for your valid responses. Regarding Mr. Qadri's 22nd posting for point #1: Yes, we are carrying out maintenance works within the factory premises, which are covered by the Factories Act.

Best regards,
Arun