IMPORTANT POINT
To decide the claims of contract labour employed with Oil and Natural Gas Corporation Limited, for regularisation of their services consequent upon the notification issued under Section 10(1) of the Contract Labour (Regulation and Abolition) Act, directions issued by the Supreme Court in Steel Authority of India case held applicable.

JUDGMENT

K.G. Balakrishnan, J.-Leave granted.

2. The Judgment of the Division Bench of the High Court of Gujarat at Ahmedabad in Letters Patent Appeal No. 395 of 1999 is challenged before us. The appellants alleged that they were workmen employed as contract labourers in the capacity of Boiler Operators through the Contractor, Ahmedabad Electricity Co. Limited. According to these appellant workmen, they were employed on contract labour with the first respondent-principal employer, namely, Oil & Natural Gas Corporation Limited (hereinafter being called as "ONGC Limited"). Consequent upon the notification dated 8.9.1994 under Section 10(1) of the Contract Labour (Regulation and Abolition) Act, 1970 by the Central Government, the contract labour in the posts of Boiler Operators, Attendants, Helpers and Peons was prohibited and these appellants claimed that they should be treated as the employees of the first respondent. They filed a Writ Petition before the High Court of Gujarat and learned Single Judge held that these appellants were persons engaged for attending different operations of the boiler in the boiler house of ONGC Ltd. through the contractor, which was clearly in breach of the provisions of the Act. It was held that these appellants must be deemed to be performing duties directly under the first respondent ONGC Limited and they must be given the terms of service as applicable to other employees of ONGC Limited with effect from the date of notification.

3. The Judgment of the learned Single Judge was challenged before the Division Bench and the Division Bench was of the view that there were some disputed question of fact and an investigation into facts regarding service conditions of contract labour was necessary before granting them the relief of direct employment with the principal employer and that the proceedings under Article 226 of the Constitution were not appropriate. It also held that there should be an investigation by the Industrial Tribunal and these appellants were directed to approach the Conciliation Officer of the concerned area and further direction was given to the Conciliation Officer to complete the conciliation proceedings within three months and if the dispute survived, the matter be referred to the Industrial Tribunal under Section 10 of the Industrial Dispute Act and the Industrial Tribunal/Labour court to take a final decision in the matter within a period of four months thereafter. These directions are challenged before us.

4. We heard Shri T.R. Andhyarujina, learned senior Counsel on behalf of the appellants and Mr. Mukul Rohtgi, learned ASG on behalf of the respondents. What is the effect of abolition of contract labour by virtue of the notification issued by Central Government under Section 10 of the Industrial Disputes Act was considered in detail in Steel Authority of India Ltd. and Others vs. National Union Waterfront Workers and Others (2001) 7 SCC 1. The main question that arose for consideration in that case was whether there should be an automatic absorption of contract labourers working in the establishment of principal employer as regular employees consequent upon the notification under Section 10(1) of the Act. This Court held in clause (5) and (6) of paragraph 125 at page 63 as under:-

"On issuance of prohibition notification under Section 10(1) of the CLRA Act prohibiting employment of contract labour or otherwise, in an industrial dispute brought before it by any contract labour in regard to conditions of service, the industrial adjudicator will have to consider the question whether the contractor has been interposed either on the ground of having undertaken to produce any given result for the establishment or for supply of contract labour for work of the establishment under a genuine contract or is a mere ruse/camouflage to evade compliance with various beneficial legislations so as to deprive the workers of the benefit thereunder. If the contract is found to be not genuine but a m