Any candidate Interview directly taken by PE is legally correct or incorrect in case of Contract Service

Dear Sir

Please revert , is it correct way to invite application from applicant , accept it and organize interview , select the candidate and then inform to consultant by principle employer to issue an appointment letter to candidate in contract service. If it is legally not correct please provide some details so that it can be proved wrong against principle employer when considering sham contract

The principal employer interfering in selection process, fixing the salary and deciding the conditions of service of a contract worker will make the contract between the Principal employer and the contractor sham. It may even lead to their regularisation.