IMPORTANT POINT
Rule 25 of the Andhra Pradesh Contract Labour (Regulation and Abolition) Rules, 1971 imposes on the contractor that the contractor shall not pay to the contract labour in his employment wages which are lower than the wages paid by the principal employer to his own workers which do the same or similar kind of work and if the contractor commits a breach of the condition, he would be held liable to pay the additional wages and not the principal employer.

JUDGMENT

Mrs. Sujata V. Manohar, J.-Spe-cial leave granted.

2. The appellant, Hindustan Steelworks Construction Ltd., is a Government company within the meaning of Section 617 of the Companies Act, 1956. It is engaged in the work of construction of various types in India and abroad. At all times material to this appeal, the appellant had undertaken to carry out civil engineering work for the 5th respondent, Vishakhapatnam Steel Plant under various contracts. The appellant had registered itself as an employer under Section 7 of the Contract Labour (Regulation and Abolition) Act, 1970.

3. Respondent No. 4 M/s. Investigation and Security Services India Pvt. Ltd., is a Private Limited Company which carries on the business of providing security services through contract labour for various companies and individuals. It maintains officers and workmen to render, inter alia, security services to various establishments and individuals. Respondent No. 4 at all material times, possessed a licence as a contractor under Section 12 of the Contract Labour (Regulation and Abolition) Act, 1970, read with Andhra Pradesh Contract Labour (Regulation and Abolition) Rules, 1971.

4. On or about 11th December, 1980, the appellant entered into an agreement with respondent No. 4 by which respondent No. 4 agreed to supply to the appellant (i) Security Guards (ii) Shift Incharge and, (iii) Security Sergeants on the terms and conditions specified in that agreement. The agreement specifies that the appellant would pay to respondent No. 4 monthly amounts at the rate of Rs. 400, Rs. 500 and Rs. 600 as remuneration for the supply of Security Guards, Shift Incharge and Security Sergeants respectively. The appellant has accordingly paid to respondent No. 4 the said amounts by way of monthly remuneration for each of the categories of workmen supplied by the 4th respondent. Respondent No. 4, however, in turn, paid to the Security Guards Rs. 317.77 instead of Rs. 400; to the Shift Incharge Rs. 360.13 instead of Rs. 500; and to the Security Sergeants Rs. 359.46 instead of Rs. 600 thus retaining Rs. 82.23 in respect of Security Guards. Rs. 139.87 in respect of Shift Incharge or Head Guards and Rs. 240.54 in respect of Security Sergeants.

5. The Assistant Commissioner of Labour connected with the enforcement of provisions of the said Act visited the site of the appellant where the contract labour supplied by the 4th respondent was employed. He found that there was a difference between the wages by the appellant to its own watch and ward staff and the contract labour supplied by the 4th respondent who were doing similar work. On 19th of May, 1983, he filed a complaint before the Commissioner of Labour. Under the proviso to Rule 25(v)(a) of the Andhra Pradesh Contract Labour (Regulation and Abolition) Rules, 1971, in the case of any disagreement with regard to the type of work, the same is required to be decided by the Commissioner of Labour, Andhra Pradesh whose decision shall be final. The Commissioner of Labour accordingly by an order dated 13th of August, 1984, held that the appellant was the principal employer and the respondent No. 4 was the contractor who had supplied contract labour under the said Act. He further held that the Security Guards supplied by the 4th respondent to the establishment of the appellant were performing the same kind of work as that performed by the Security Guards engaged by the appellant itself.

6. The 4th respondent thereupon filed a writ petition before the Andhra Pradesh High Court, being Writ Petition No. 12963 of 1984 challenging the order of the Commissioner of Labour. A learned Single Judge of the High Court by his order dated 6th of July, 1988 dismissed the writ petition and upheld the order of the Commissioner of Labour. Aggrieved by this order, respondent No. 4 preferred an appeal before the High Court being appeal No. 1196 of 1988. The Division Bench of the High Court decided to examine the legality of the agreement dated 11th Decem