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THE HIGH COURT OF SIKKIM: GANGTOK
BISWANATH SOMADDER, BHASKAR RAJ PRADHAN
Sikkim Urja Limited, (Formerly: Teesta Urja Limited), Through Authorized Representative Satyan Sood – Appellant
Versus
Abir Infrastructure Pvt. Ltd., Through its Managing Director – Respondent
| Table of Content |
|---|
| 1. nature of the dispute involving the liability to pay labour welfare cess in a turnkey construction project. (Para 1 , 3 , 4 , 5) |
| 2. parties' contentions regarding 'change in law' under the contract versus statutory liability for construction cess. (Para 6 , 7) |
| 3. findings of the arbitral tribunal regarding the implementation date of statutes and the assignment of liability for cess. (Para 8 , 9 , 10 , 11) |
| 4. the commercial court's interpretation of statutory implementation timing in the context of section 34 of the arbitration act. (Para 12 , 13) |
| 5. examination of the statutory framework of the bocw act and cess act to determine liability for construction welfare cess. (Para 16 , 17 , 18 , 19 , 20 , 21 , 22 , 23 , 24 , 25 , 26 , 27 , 28 , 29 , 30 , 31 , 32) |
| 6. critical analysis of the arbitral tribunal's failure to apply supreme court precedents and the incorrect interpretation of 'change in law'. (Para 33 , 34 , 35 , 36 , 37 , 38 , 39 , 40 , 41 , 42) |
| 7. setting aside of the arbitral award based on patent illegality and contravention of fundamental policy of indian law. (Para 43 , 44 , 45) |
JUDGMENT :
Bhaskar Raj Pradhan, J.
This is an appeal preferred under section 37 of
Statutory liability to pay welfare cess under labor legislation falls upon the contractor as the employer. Such liability is inherent to the statute, cannot be reallocated via contract clauses based ....
The interpretation of the Building and Other Construction Workers Act and the Cess Act requires the establishment of welfare boards for the effective levy and collection of cess; until then, contract....
(1) Cess could only be recovered in the manner stipulated in Cess Act and Rules framed thereunder.(2) A contractor who enters into a pure Supply Contract is statutorily exempted from levy under BOCW ....
Dredging activities fall within the definition of construction work under the BOCW Act, affirming cess obligations for such activities.
The main legal point established in the judgment is the importance of interpreting the statute by considering the text and context, and the applicability of the enabling provision of section 3(1-A) a....
The main legal point established in the judgment is that the labour cess is not leviable on the supply of materials and consultancy charges under the Building and Other Construction Workers' Welfare ....
The court held that deductions for the cess on construction payments are valid under the relevant welfare legislation, affirming that activities like laying pipelines constitute construction work.
The imposition of 1% cess under the Building and Other Construction Workers Act is a statutory obligation aimed at benefiting workers, and is applicable despite claims regarding the Factories Act exe....
Taxes not to be imposed save by authority of law - Article 265 of Constitution is the source of power for the Union and States to impose taxes in accordance with law. Article 265 of the Constitution ....
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