The learned single Judge has made this reference to the Larger Bench as he felt that there is an apparent conflict between the two Division Bench Judgments of this Court as regards the issue whether the right of the principal employer to reject or accept work on completion, on scrutinizing compliance with job requirements, as accomplished by a contractor, the immediate employer, through his employees, is in itself an effective and meaningful supervision as envisaged under Section 2(9) of the Employees State Insurance Act, 1948 (for brevitys sake, hereinafter will be referred to as the Act).

.2. The facts leading to this reference may be stated shortly. The Southern Railway

.placed orders in respect of certain engineering works with the respondent and for execution of the works, the respondent used to assign some job work to outside parties by supply of materials. The outside parties were having their own establishment and employees. According to the respondent, the work was done on the specifications provided by the respondent at the premises of the third parties under their own supervision and control and the parties were paid on the basis of job works done by them and the respondent had no supervision or control over the workmen of the outside parties. There was thus no master and servant relationship between the respondent and the employees of the third parties. The appellant -Regional Director, Employees State Insurance Corporation in exercise of his power under Section 45-A of the Act, determined the contribution payable by the respondent towards labour charges in respect of job work entrusted to third parties at Rs.13,604.40 and he also determined as regards the loading and unloading charges with which we are not concerned in the present reference. The respondent filed E.S.I.O.P.No.46 of 1990 under Section 75 of the Act before the Employees State Insurance Court. The Employees State Insurance Court on a consideration of the oral and documentary evidence available on record and by relying upon the decision of the Supreme Court in Calcutta Electric Supply Corporation (C.E.S.C.) Limited etc. -vs-Subhash Chandra Bose and Others, 1992 (1) LLJ 475 (SC) and that of the Division Bench of Bombay High Court in Parle Bottling Company (Private) Limited -vs-Employees State Insurance Corporation, Bombay, 1989 (2) LLN 494 (DB) held that the respondent is not liable to pay any contribution in respect of the work done outside the establishment and the employees of the contractor are not covered by the Act. Being aggrieved by that, the Employees State Insurance Corporation has filed the present appeal.

.3. Before the learned Single Judge, it was argued on behalf of the appellant that since the respondent had arrogated to itself the right to reject the end product manufactured by the contractors/employees, that by itself was supervision so as to attract the provisions of the Act. In support of this submission, reliance was placed on a Division Bench judgment of this Court in the case of Poonam Easwardas, Proprietrix M/s. Kaleel Corporation -vs- Employees State Insurance Corporation, 2003 (1) L.W.685, wherein the Division Bench following the decision rendered by the Supreme Court in the case of Silver Jubilee Tailoring House -vs-Chief Inspector of Shops and Establishments, AIR 1974 SC 37 held that the fact that the employer has the right to direct the worker to re-stitch the garment would itself establish that there exists an element of control and supervision as formulated by the decision of the Supreme Court and that would suffice to sustain the finding that such persons are employees for the purpose of the Act, and consequently, the employer is liable to pay contribution on the amounts paid to the persons who did tailoring work though such work was done outside the premises of the employer and by using tools which did not belong to the employer. On the other hand, learned Senior Counsel appearing for the respondent placed