M. Venkaiah Chowdary and others vs Municipal Corporation of Guntur and others

L. Narasimha Reddy, J.—Petitioners were awarded sanitation Contracts for three years i.e. 2006-2009, for various circles/wards of Guntur Municipal Corporation. They were paid the wages for the work, at the rate of Rs. 66/- per worker, per day, for the year 2006-07; Rs. 69.90 ps. , for August 1, 2007, and Rs. 90/- for the year September 1, 2008. After prolonged correspondence, the District Level Committee for fixation of daily wages, recommended the rates at Rs. 84/-, Rs. 90/- and Rs. 115/- respectively, for the three years, referred to above. The grievance of the petitioners is that the respondents 1 to 3 are proposing to pay differential amount to the workers, directly. The petitioners contend that, whether it is u/s 21 of the Contract Labour (Regulation and Abolition) Act, 1970 (for short ''the Act''), or the conditions of the contract, executed in their favour, the basic obligation to pay wages is with them and that wages were paid, earlier, as per the contract, there is no basis for attempting to pay the differential amount to the workers, directly.

On behalf of the respondents 1 to 3, a counter-affidavit is filed, alleging that complaints have been received from the workers to the effect that the petitioners have committed default in payment of wages, and that the difference of the minimum wages need to be paid to them, directly. It is also stated that Government issued orders in G.O. Rt. No. 1289, dated September 9, 2008, directing that the wages, in contracts of this nature, must be paid through cheques, directly to the workers, and that the same procedure is being followed. Certain workers said to have been engaged by the petitioners, got themselves impleaded. They complain that they have not been paid the wages properly, and that the differential amount need to be paid to them directly.

Heard Sri P. Govind Reddy, learned Counsel for the petitioners, Sri V.C.H. Naidu, learned Standing Counsel for respondents 1 to 3, and Sri Nuthalapati Krishna Murthy, learned Counsel for the impleaded respondents.

The petitioners were awarded the sanitation contract for three consecutive years. They were also paid the amounts, as per the rates fixed under the respective contracts. However, representations were made by the petitioners, as well as the workers, before the District Level Committee, stating that the minimum wages were not being paid. The Committee examined the matter, and recommended for revision of Wages. One such recommendation was contained in proceedings dated July 18, 2007, Complaining that it is not being implemented, the petitioners approached this Court by filing W.P. No. 9837 of 2008. The writ petition was disposed of on June 17, 2008, directing the Corporation to implement the recommendations made by the Committee, and to pay the difference of wages to "the petitioners, as recommended by the Committee. The wages have also been revised in similar fashion, for subsequent years. The Corporation has now taken a decision to pay the difference of wages. The only controversy is, as to whether the said amount must be paid to the petitioners, or to the workers, engaged by them.

u/s 21 of the Act, the basic obligation to pay wages, engaged on contract basis, is with the Labour Contractor. It is only in exceptional cases, that the principal employer has to pay the wages, and recover them from the Labour Contractor. The circumstances provided for u/s 21 of the Act, for such an eventuality, do not exist, in the instant case. During the subsistence of the contract, the workers did not complain to the Corporation, about nonpayment of wages, much less, any proceedings were initiated before the Authorities under the Minimum Wages Act. It was with the effort of the petitioners, that the difference of the wages was determined, and a stage has reached for payment thereof.

It is no doubt true that the benefit of difference of amount must accrue to the workers. However, the identification of the workers, or the adjustment of the amounts, if any, already paid to them, by the contractor, is a matter of verification. The Corporation cannot bypass the contractors, in extending the benefit of the differential amount.

The Corporation places reliance upon G.O. Rt. No. 1289, dated September 9, 2008, issued by the Government, according to which, the wages must be paid to the workers, through cheques, directly. This procedure was implemented for the contracts, that were awarded subsequent to the G.O. At no point of time, the petitioners were governed by the same. It is a matter of record to the subsistence of contracts in favour of the petitioners, the are Paid to the petitioners, i.e., the contractors, and they, in turn, paid the to the workers, engaged by them. Even while making payment of the to the petitioners, the Corporation can ensure that the workers receive due to them, after proper verification. For this purpose, an officer of the action, and an official of the Labour Department, can be folded in.

Hence, the writ petition is allowed, direction that--

(a) the 1st respondent shall pay the amount of difference of wages for the period September 1, 2006 to the petitioners. The petitioners, in turn, shall be under obligation to prepare a statement in the presence, or with the approval of an official of the Corporation and of the Labour Department, for payment of the same to the respective workers, and

(b) the 1st respondent and the District Labour Officer, Guntur, shall nominate one officer each, to co-ordinate with the petitioners in preparing the list of workers, engaged by the petitioners, during the subsistence of contract, and the amounts due to them; and they shall ensure that the workers are paid, accordingly.

There shall be no order as to costs.