Shiv Kumar Sharma, J.@mdashThis appeal arises from the judgment dated 29.4.1992 passed by the Commissioner, Workmen''s Compensation,
District Ajmer (for short ''the Commissioner'') whereby petition u/s 10 of the Workmen''s Compensation Act, 1923 (for short ''the Act'') was
allowed and Manohar, the claimant-respondent No. 1 was awarded Rs. 1,42,074 as compensation.
Background Facts
2. The facts of the case lie in a very narrow compass. Respondent No. 1 (for short ''Manohar'') initiated proceedings u/s 10 of the Act before the
Commissioner stating therein that respondent No. 2 (for short ''Shiv Dutt'') got the contract of whitewashing from the appellant (for short the
''Board'') and engaged workers. On 2.12.1993 Manohar fell down while whitewashing the top floor of the building as a result of which he was
severely injured and his right leg was completely amputated, therefore he became unfit to do any work. Manohar claimed Rs. 42,000 as
compensation. In the reply Shiv Dutt stated that he gave the sub-contract to Mangilal. Thus Mangilal was also impleaded in the claim petition. Shiv
Dutt has further stated that Manohar was assigned the work of whitewashing in the corridor but he himself reached on the roof and met with the
accident.
3. The Board in its reply denied liability towards claim and stated that definition of ''employer'' as contemplated u/s 2(1)(e) of the Act does not
include ''Board''. Mangilal was proceeded ex pane and the Commissioner framed as many as three issues which have been set out in the judgment
of the trial court. The parties adduced their evidence and the learned Commissioner awarded compensation as mentioned hereinabove.
4. The question springing up for consideration is whether the ''Board'' is an employer under the provisions of the Act and is liable for
compensation?
Statutory Background
5. The preamble to the Act recites that it is expedient to provide for the payment by certain classes of employers to their workmen of
compensation for injury by accident. The section which fixes the liability of the employer is Section 3 and the relevant part of the section for the
purpose of the present discussion runs as follows:
(1) If personal injury is caused to a workman by accident arising out of and in the course of his employment, his employer shall be liable to pay
compensation in accordance with the provisions of this Chapter...
6. The next important section is Section 12 which runs thus:
(1) Where any person (hereinafter in this section referred to as ''the principal'') in the course of or for the purposes of his trade or business
contracts with any other person (hereinafter in this section referred to as ''the contractor'') for the execution by or under the contractor of the whole
or any part of any work which is ordinarily part of the trade or business of the principal, the principal shall be liable to pay to any workman
employed in the execution of the work any compensation which he would have been liable to pay if that workman had been immediately employed
by him; and where compensation is claimed from the principal, the Act shall apply as if references to the principal were substituted for references
to the employer except that the amount of compensation shall be calculated with reference to the wages of the workman under the employer by
whom he is immediately employed.
(2) Where the principal is liable to pay compensation under this section, he shall be entitled to be indemnified by the contractor, or any other
person from whom the workman could have recovered compensation and where a contractor who is himself a principal is liable to pay
compensation or to indemnify a principal under this section he shall be entitled to be indemnified by any person standing to him in the relations of a
contractor from whom the workman could have recovered compensation and all questions as to the right to and the amount of any such indemnity
shall, in default of agreement, be settled by the Commissioner.
(3) Nothing in this section shall be construed as preventing a workman from recovering compensation from the contractor instead of principal.
7. A perusal of Section 12 of the Act demonstrates that under the Act, a new liability is created and the employer even though he may not in the
least be culpable is made liable to pay his contractor''s workman where he employs a contractor for his trade or business. The liability is fastened
on the employer vicariously and by Sub-clause (2) he is given an indemnity by the contractor. Obviously, the object behind these provisions of the
Act is to secure compensation to the workman who cannot fight out his battle for compensation by a speedy process. One sees in the provision the
view that a person who employs others to advance his own business and interest should be more promising and certain source of recompense to
the injured workman than the intermediary who may be a man of straw. It may be that the workman is employed by a contractor or subcontractor
under the employer. Then, by virtue of Section 12, the workman may claim compensation under the Act from the ultimate employer, i.e., the
principal employer. It looks as if the framers of the Act had in view only the claim of workmen, i.e., those engaged or employed by the employer,
for consideration by the authorities under the Act. The contractor, the sub-contractor and the workmen at the end are all persons employed one
under the other under the principal employer.
Rival Contentions
8. It is in the context of the above statutory provisions that I shall consider the rival contentions. On behalf of the appellant learned Counsel made
an attempt to establish that Manohar had no contractual relations with the Board as he was engaged by Mangilal who was a subcontractor. It was
canvassed that the court below unnecessarily invoked the provisions contained in Contract Labour (Regulation and Abolition) Act, 1970 (for short
''Act of 1970''). The Commissioner did not care to frame the issues properly and awarded such compensation which was not claimed by the
respondent Manohar. Learned counsel placed reliance on the following:
(i) Garrison Engineer (Projects), Office of the Commander Works Engineers v. Guttamma Hanmatdas 1978 Lab 1C 878; (ii) Shantabai v.
Sahadeo 1985 ACJ 845 (Bombay); (iii) Gopal Das Nandy v. Alladi Bibee 1967 ACJ 106 (Calcutta); (iv) Municipal Board, Almora Vs. Jasod
Singh and Another, (v) New India Tannis Ltd. Vs. Aurora Singh Mojbi and Another, (vi) Vijayaraghavan v. Velu 1973 ACJ 158 (Kerala).
9. On the other hand, learned Counsel for the respondent Manohar supported the judgment of learned Commissioner and placed reliance on the
following authorities:
(i) Kamla Devi v. Bengal National Textiles Mills Ltd. 1975 ACJ 75 (P&H); (ii) S.B. Gumbaksh Singh v. Dhani Devi 1980 FJR (57) 275; (iii)
Dharangadhara Chemical Works Ltd. v. State of Saurashtra (1950) SCLJ (3) 2022; (iv) Bhutabhai Angadbhai v. Gujarat Electricity Board 1987
ACJ 987 (Gujarat); (v) Trustees of Port of Madras v. Bombay Company (P) Ltd. 1966 ACJ 351 (Madras); (vi) Pratap Narain Singh Deo v.
Shrinivas Sabata 1976 ACJ 141 (SC); (vii) F.C.I. Workers Union v. F.C.I. 1990 (1) LLN 972. English Decisions
10. Some English decisions may be referred in connection with the relationship of employer and employee. Lord Justice Hilbery in Collins v,
Hertfordshire County Council 1947 KB 598, had drawn distinction between a contract for services and a contract of service thus:
In one case the master can order or require what is to be done while in the other case he cannot only order or require what is to be done but how
itself it shall be done.
The test which is uniformly applied in order to determine the relationship as between employer and employee is the existence of a right of control in
respect of the manner in which the work is to be done. This test is, however, not"" accepted as universally correct. The following observations of
Denning, LJ. at pp. 110, 111 in Stevenson, Jordan and Harrison Ltd. v. Macdoneld and Evans 1952 (1) TLR 110, are apposite in this contest:
But in Cassidy v. Ministry of Health 1951 (2) KB 343, Lord Justice Somervell pointed out that the test is not universally correct. There are many
contracts of service where the master cannot control the manner in which the work is to be done as in the case of a captain of a ship.
The position of law is summarised in Hals Bury''s Laws of England, Hailsham Edn, Vol. 22, p. 112, para 191-
Where or not, in any given case, the relation of master and servant exists is a question of fact, but in all cases the relation imparts the existence of
power in the employer not only to direct what work the servant is to do, but also the manner in which the work is to be done.
Decisions of Supreme Court and other High Courts
11. Dharangadhara Chemical Works Ltd. (1950) SCLJ (3) 2022, was a case where the Supreme Court had occasion to deal with the aspect
relating to employer and employee. After referring to certain English decisions, their Lordships of the Apex Court propounded thus:
The principle which emerges from these authorities is that the prima facie test for the determination of the relationship between master and servant
is the existence of the right in the master to supervise and control the work done by the servant not only in the matter of directing what work the
servant is to do but also the manner in which he shall do his work, or to borrow the words of Lord Uthwatt at page 23 in Mersy Docks and
Harbour Board v. Coggins and Grifith (Liver Pool) Ltd. 1947 (1) AC I. The proper test is whether or not the hirer had authority to control the
manner of execution of the act in question.
12. Pratap Narain Singh Deo v. Shrinivas Sahara 1976 ACJ 141 (SC), was the case where the Supreme Court laid down that the employer
becomes liable to pay the compensation as. soon as the personal injury was caused"" to the workman by the accident which arose out of and in the
course of employment.
13. Trustees of Port of Madras v. Bombay Company (P) Ltd. 1966 ACJ 351 (Madras), was the case where the Madras High Court held that the
contractor, the sub-contractor and the workmen at the end are all persons employed one under the other under the principal employer. The Act
itself is intended to provide for payment by certain classes of employers to their workmen of compensation for injury by accident.
14. S.B. Gurubaksh Singh v. Dhani Devi 1980 FJR (57) 275, was the case where Delhi High Court observed thus:
The list in Schedule II of the Act includes persons employed for the construction, maintenance or the repair of buildings, etc. A person employed
by a building contractor for whitewashing would, therefore, be working in a capacity specified in that Schedule for the purpose of the trade or
business of the contractor. He would be doing whitewashing as part and parcel of the contract undertaken by the contractor and the work done
would be in accordance with the requirement of the contract under the supervision of the contractor. He cannot, therefore, be called an
independent or sub-contractor but is a workman paid on job basis to whom the provisions of the Act would be applicable.
15. Kamla Devi v. Bengal National Textiles Mills Ltd. 1975 ACJ 75 (P&H), was the case where workman died as a result of head injury caused
while engaged in whitewashing of factory premises. It was held by Punjab and Haryana High Court that he died in the course of employment and
company was liable to pay compensation.
16. Bhutabhai Angadbhai v. Gujarat Electricity Board 1987 ACJ 987 (Gujarat), was the case where workman died as a result of injuries sustained
by him on account of electric shock which he received while he was doing the work of painting the electric pole belonging to Gujarat Electricity
Board. It was held by Gujarat High Court that maintenance of distribution lines was ordinarily part of trade or business of Electricity Boards, might
be done by the Board by employing its own servants or through contractors. If a workman employed by contractor met with accident, Board was
liable for payment of compensation to the employee.
17. The ratio of the cases of Garrison Engineer (Projects), Office of the Commander Works Engineers v. Guttamma Hanmatdas 1978 Lab 1C
878; S/uwmfcai v. Sahadeo 1985 ACJ 845 (Bombay); Gopal Das Nandy v. Alladi Bibee 1967 ACJ 106 (Calcutta); Municipal Board, Almora
Vs. Jasod Singh and Another, New India Tannis Ltd. Vs. Aurora Singh Mojbi and Another, and Vijayaraghavan v. Velu 1973 ACJ 158 (Kerala),
cited by the learned Counsel for the appellant is not applicable as in all the cases the facts are distinguishable and the provisions of Section 12 of
the Act have been interpreted and some cases relate to casual workers.
Conclusion
18. I am not impressed by the argument of learned Counsel for the appellant ''Board'' that Manohar could not be considered in the employment of
the ''Board'' in view of provisions contained in the Act of 1970. In F.C.I. Workers Union v. F.C.I. 1990 (1) LLN 972, Division Bench of Gujarat
High Court (Hon''ble A.P. Ravani and J.V. Mehta, JJ) propounded thus:
From the facts of the case and the legal position, it becomes clear that for certain periods the principal employer, i.e., the Food Corporation of
India, did not possess certificate of registration as required under the provisions of Section 7 of the Act of 1970. Similarly, the contractors through
whom the workmen were engaged also did not possess licence issued u/s 12 of the Act of 1970 by the ''appropriate Government'' for certain
periods. Therefore, in relation to this period, the workmen can very well claim that the workmen were employed directly by the principal employer,
i.e., Food Corporation of India.
In the case on hand also the Board did not possess certificate of registration as required u/s 7 of the Act of 1970. Similarly, contractor was also
not possessing licence as required u/s 12 of the Act of 1970. Therefore, Manohar can very well claim that he was employed directly by the
principal employer, i.e., the ''Board''. The object of the Act of 1970 is to regulate and to improve the conditions of service of contract labour and
not merely to abolish contract labour. It is an important piece of social legislation and it seeks to regulate the employment of contract labour and
where necessary to abolish the same. It is a legislation for the welfare of labourers whose conditions of service are not at all satisfactory.
19. In Bhutabhai''s case 1987 ACJ 987 (Gujarat), it was indicated thus:
The object of enacting Section 12 of the Workmen''s Compensation Act, is to give protection to the workmen and secure compensation from the
persons who can pay and in case of an accident such workmen will not be dependent sometime upon a petty contractor who will not be able to
pay compensation on account of financial inability. In our opinion, the main object of enacting Section 12 of the Act is to secure compensation to
the employees who have been engaged through the contractor by the principal employer for its ordinary part of business, which, in the ordinary
course, the principal employer is sup- posed to carry out by its own servants.
20. ''Workman'' is defined in Clause (n), Sub-section (1) of Section 2 of the Act as under:
(n) ''workman'' means any person (other than a person whose employment is of a casual nature and who is employed otherwise than for the
purposes of the employer''s trade or business) who is...
(Emphasis supplied)
The expression ""otherwise than for the purposes of the employer''s trade or business"" occurring in the aforesaid definition of ''workman'' carries
significance. Business would mean anything which occupies the time, attention and labour of a man for the purpose of profit. It is wider than trade.
The maintenance and upkeep of the premises of the business must be taken as purpose of business. Therefore, the maintenance and repairs of the
building where the Board carried on business, have to be considered as purposes of business. Whitewashing of the building of the Board provided
good view and healthy atmosphere for the employees working there. This whitewashing of the building of the Board has to be taken as one for the
purposes of its business.
21. So far as the argument that the issues were not properly framed is concerned, I may observe that law is well settled that wrong wording of an
issue or misplacement of onus of proof, does not warrant the setting aside of impugned judgment, especially when the parties to the case were
cognizant of the point involved and they had led evidence in proof or disproof of the same. In the instant case there is absolutely nothing to show
that the parties or any of them has been prejudiced by not framing issue against the ''Board''. No doubt that Manohar claimed only Rs. 42,000 but
he was awarded Rs. 1,42,074 in accordance with Section 4 read with Schedule IV of the Act, considering relevant factor of 18 years of age, 90
per cent loss of earning capacity and wages at the rate of Rs. 30 per day. I find no illegality in the impugned judgment.
22. Consequently, appeal fails and is hereby dismissed with costs.