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2011 (9) TMI 1266
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....hi delivered in LPA No.38 of 2007, LPA No. 1065 of 2007, Writ Petition (C) No.139 of 2008 and Writ Petition (C) No.6763 of 2008 on December 18, 2009. 3. The short question which arises for consideration in these appeals is whether the Notification dated 26th July, 2004 issued by the Central Government under Section 10 (1) of the Contract Labour (Regulation and Abolition) Act, 1970 (for short, 'CLRAA') prohibiting employment of contract labour of trolley retrievals in the establishment of the Airport Authority of India (for short, 'AAI') at the Indira Gandhi International Airport and Domestic Airport at Delhi would be applicable to the Delhi International Airport Private Limited (for short, 'DIAL') or not? 4. This judgment would decide these appeals preferred before this Court against the following Letters Patent Appeals and Writ Petitions decided by the High Court: a). Indira Gandhi International Airport TDI Karamchari Union v. Union of India and others - LPA No.38 of 2007 This Letters Patent Appeal was filed against the judgment of the learned Single Judge dated 28th November, 2006 in Writ Petition (C) No. 15156 of 2006. The workers' Union h....
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....e perennial nature of the work, the workmen approached the Contract Labour Court for abolition of contract labour system and for their absorption as regular employees. AAI came into force merging the International Airport Authority Act, 1971 and the National Airport Authority Act, 1985. On 26th July, 2004 the Central Government accepted the recommendations of the Contract Labour Court and issued notification dated 26th July, 2004 abolishing the contract labour system. 7. This notification was challenged by AAI before the High Court of Delhi. Taking note of the ONGC judgment reported in Oil and Natural Gas Commission and Another Vs. Collector of Central Excise 1992 Suppl. (2) SCC 432 the High Court vide judgment dated 3rd February, 2005 held that the present proceedings cannot be proceeded with till the matter is resolved by the High Powered Committee (HPC). Accordingly, the matter went to the HPC and the notification was not given effect to. 8. Meanwhile, 136 workers who were engaged as Trolley retrievers by the contractor M/s. TDI International Private Limited working at the airport since 1992 were removed from service on 5th December, 2003 as the contract of M/s. TDI Intern....
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....entral which Government is not the appropriate government for DIAL and secondly whether the notification that applies to the 'establishment of AAI' will be applicable to the 'establishment of DIAL' which only came into existence on 4th April, 2006? This is the subject matter of SLP (C) No.377 of 2010 filed by DIAL. 13. We deem it appropriate to deal with the basic objects and reasons of passing the CLRAA. This Act was enacted with a view to abolish the contract labour under certain circumstances and to provide for better conditions of service to the labour. The business of providing contract labour is regulated as the contractor is required to obtain a licence and the principal employer is not entitled to engage a contractor without obtaining registration. The rules also contain detailed provisions to carry out the purposes of the Act. It is significant to note that the 1970 Act does not create any machinery or forum for the adjudication of any dispute arising between the contract labour and the principal employer of the contractor. 14. The object of the Act was dealt with by this Court in the judgment of Gammon India Ltd. and Others v. Union of India (UOI) an....
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....ard of Trustees and the State Boards of Trustees constituted under section 5A and section 5B, respectively, of the Employees' Provident Fund and Miscellaneous Provisions Act, 1952 (19 of 1952), or the Life Insurance Corporation of India established under section 3 of the Life Insurance Corporation Act, 1956 (31 of 1956), or [the Oil and Natural Gas Corporation Limited registered under the Companies Act, 1956 (1 of 1956)], or the Deposit Insurance and Credit Guarantee Corporation established under section 3 of the Deposit Insurance and Credit Guarantee Corporation Act, 1961 (47 of 1961), or the Central Warehousing Corporation established under section 3 of the Warehousing Corporations Act, 1962 (58 of 1962), or the Unit Trust of India established under section 3 of the Unit Trust of India Act, 1963 (52 of 1963), or the Food Corporation of India established under section 3, or a Board of Management established for two or more contiguous States under section 16, of the Food Corporations Act, 1964 (37 of 1964), or [the Airports Authority of India constituted under section 3 of the Airports Authority of India Act, 1994 (55 of 1994)], or a Regional Rural Bank established under sectio....
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....try carried on by or under the authority of the Central Government. Secondly, the Central Government is the "appropriate government" in relation to industrial disputes concerning AAI. Thirdly, the Central Government is the "appropriate government" in relation to industrial disputes concerning an air traffic service. Thus, if DIAL's industry is carried on "under the authority" of the Central Government, if the dispute in question can be said to concern AAI, or the dispute in question can be said to concern an "air transport service", then the Central Government is the "appropriate government" both under ID Act and CLRAA. 17. In these appeals, the validity of the Notification dated 26th July, 2004 issued by the Central Government under Section 10(1) CLRAA was assailed by AAI and DIAL. It was also urged that the Notification dated 26th July, 2004 cannot bind DIAL. 18. It was further contended that DIAL is not an agent of AAI and DIAL cannot be considered as a 'delegate' of such an entity. It was also contended that an "establishment" in question is that of DIAL, wherever it conducts its business and that in relation to DIAL there has to be a separate Section 10 (1) n....
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....ng of passengers' luggage, booking of cargo, and, therefore, the Central Government is the appropriate government. 21. The Division Bench held that the notification dated 26th July, 2004 issued by the Central Government under Section 10(1) CLRAA is valid and binding on it. The Division Bench in the impugned judgment held that the recourse to the ID Act for the purposes of understanding what is an "establishment" is misconceived since the definition of 'establishment' under CLRAA is unambiguous. It is futile to seek recourse to ID Act to understand what is an 'establishment' for the purposes of CLRAA. The Division Bench further held that the establishment is one and it cannot be divided into several small establishments where for one part the appropriate government would be the Central Government and for the other part it would the State Government. Such an interpretation would run counter to the scheme of CLRAA and would defeat its object and purpose. 22. The Division Bench also held that it is inconceivable by virtue of Section 12A of the AAI Act, that only the functions and powers of AAI stand transferred and not the corresponding obligations. In fact, i....
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....ns availing of any air transport services from such airport or for the handling of baggage or cargo by such service, and includes land comprising of any building and structure on such area." 26. The Division Bench further observed that when the above definitions are read along with Section 1(3) of the AAI Act, it is plain that the AAI Act will apply to a civil enclave. It is clear that the handling of baggage or cargo by an air transport service would form part of the services provided in a civil enclave. The functions that have been excluded under Section 12A(1) of the AAI Act are "air traffic services or watch and ward at airport and civil enclaves". In other words, air traffic services and provision of watch and ward at the airport and civil enclaves remain with AAI, notwithstanding that it has entered into an agreement of OMDA with DIAL. 27. The Division Bench further observed that the Air Traffic Rules envisage that all the licences for air and air traffic service would be issued separately. That by itself may not be determinative of whether trolley retrieval forms part of the services to be provided by DIAL in terms of OMDA. Only 'air traffic services and provision ....
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....st that the Central Government's 26th July, 2004 notification directed at "AAI establishment" under the authority of Section 10(1) of CLRAA is inapplicable to DIAL. First, DIAL claims that the Central Government is not the appropriate government to issue such notices to it. Second, DIAL claims that even if the Central Government was the appropriate government, its 26th July, 2004 notification was directed at "AAI establishment" and AAI and DIAL are separate establishments. For the terms of the notice to be made applicable to DIAL establishment, a separate notification would have to be issued. These two issues will be addressed in its own turn. 32. WHETHER THE CENTRAL GOVERNMENT IS THE 'APPROPRIATE GOVERNMENT" CLRAA Section 2(1) reads as follows: (1) In this Act, unless the context otherwise requires,- (a) "appropriate government" means, -- (i) in relation to an establishment in respect of which the appropriate government under the Industrial Disputes Act, 1947 (14 of 1947), is the Central Government; (ii) in relation to any other establishment, the Government of the State in which that other establishment is situated. 33. In the ....
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....flight or series of flights; 37. Section 12A of the AAI Act, which was inserted with effect from 1.7.2004, reads as under: "12A. Lease by the authority .- (1) Notwithstanding anything contained in this Act, the Authority may, in the public interest or in the interest of better management or airports, make a lease of the premises of an airport (including buildings and structures thereon and appertaining thereto) to carry out some of its functions under section 12 as the Authority may deem fit; Provided that such lease shall not affect the functions of the Authority under section 12 which relates to air traffic service or watch and ward at airports and civil enclaves. (2) No lease under sub-section (1) shall be made without the previous approval of the Central Government. (3) Any money, payable by the lessee in terms of the lease made under sub-section (1), shall form part of the fund of the Authority and shall be credited thereto as if such money is the receipt of the Authority for all purposes of section 24. (4) The lessees, who has been assigned any function of the Authority under sub-section (1), shall have all the powers of the Aut....
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....c control and related services. Consequently, the National Airports Authority (NAA) was constituted under the National Airports Authority Act, 1985. 3. International airports are put to more intensive use and generate substantial revenues which accrue to the IAAI. Revenues of the NAA are much less buoyant because a number of its airports do not have any commercial air service whatsoever while many others have only infrequent operations. The NAA has, therefore, not been able to generate adequate resources to meet the requirements of development and modernization. To overcome this handicap and provide for closer integration in the management of airports and air traffic contract services in the country, it has been found necessary to merge the IAAI and the NAA, which the Bill seems to achieve. 4. The salient features of the Bill are :- (a) Constitution of a single unified Airports Authority of India to control and manage both the national and international airports in the country and transfer and vesting of the undertakings of the International Airports Authority of India and National Airport Authority in the said Airports Authority of India. (b) Re....
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....t the authors of the ID Act, in listing the enumerated industries, simply wanted to ensure that those industries were covered by the Act, without meaning to affect the separate issue of whether those industries were also acting "under the authority of the Central Government." Further, while it is fair to assume that the legislature attempts to avoid tautology, such canons are not necessarily dispositive. It is well established canon of statutory construction that the legislature is known to avoid tautology and redundancy. 44. The crucial questions which need our adjudication are: whether DIAL works under the Central Government and whether the Central Government is the 'appropriate government' for DIAL? 45. The AAI Act was passed by the Central Government "to provide for the constitution of the Airports Authority of India' which was in turn charged with the "better administration and cohesive management of airports." Preamble to Section 12A of the AAI Act allows AAI to contract with third parties to perform some of AAI's functions (in the public interest or in the interest of better management of airports). It was this proviso which allowed AAI to assign some o....
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....and ID Act. 50. In the impugned judgment, the Division Bench correctly held that "the provisions of the AAI Act show that there is extensive control of the Central Government over the functioning of AAI." Section 12A reveals control of the Central Government on AAI. AAI has to obtain approval from the Central Government before delegating any of its functions to third parties, such as DIAL. This clearly indicates that the Central Government has complete control over AAI. Sections 2, 6 and 10 of the AAI are further examples of governmental reservations of authority. The Central Government retains its statutory control over AAI. In the impugned judgment, the High Court correctly came to the conclusion that "the authority of the Central Government is conferred by the statute itself." 51. In fact, in these cases, we are merely concerned with very limited controversy whether DIAL works under the authority of the Central Government or not? DIAL, of course, claims that it does not. In the SAIL judgment, the Constitution Bench held as under : "the phrase "any industry carried on under the authority of the Central Government" implies an industry which is carried on by virtue o....
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....DIAL at the Delhi airports itself was fully dependent on the approval of the Central Government. In other words, DIAL could not have received its contract with AAI without the Central Government's approval. That being the case, by a plain reading of the phrase it seems that "DIAL functions under the authority of the Central Government". 56. It was argued on behalf of DIAL that "if the intent of the Parliament was to make DIAL come under the authority of the Central Government then it would have militated against the basic objective of achieving privatization." DIAL, however, does not explain how having the State Government as the appropriate government - the only alternative under CLRAA and ID Act - would be any more conducive to privatization. It is now clear that the Central Government does not impede privatization any more than the State Government; after all, it was the Central Government that sought to encourage privatization through the AAI Act by incorporating Section 12A in the Act. 57. In case AAI and DIAL act under the authority of different governments it would bring about absurd results : AAI could simply circumvent potential Central Government orders by deleg....
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.... and objects, as DIAL would have liked the Court to believe. Clearly, trolleys at airports relate to air transportation- just as they relate to "a single flight or a series of flights." 61. On behalf of DIAL, it was submitted that "air transport services" as enumerated industry under ID Act replaced an earlier listing of "Indian Airlines" and "Air India", two corporations clearly engaged in the actual, physical transportation of individuals by air. 62. At the time of amendment when private airline operators had started functioning and as "air transport service" they included all airline operators, private or public and the said industry was included as an enumerated industry. This makes it abundantly clear that "air transport service" concerns airline operators only. 63. Section 12(2) of the AAI Act reads as under: "It shall be the duty of the Authority to provide air traffic service and air transport service at any airport and civil enclaves." 64. It may be relevant to mention that DIAL is not engaged in the business of operating an airline for carrying passengers and goods by air through flights. In fact, AAI is also not involved in this activity and Section ....
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....ishment of AAI at the Indira Gandhi International Airport and Domestic Airport underwent a change and a new private entity in the form of the appellant DIAL established its establishment, after being granted a lease under Section 12A of the AAI Act. In support of this claim, DIAL contends that it has complete overall control and supervision over the Airport to the exclusion of AAI, and is not an agent or delegate of AAI but is, rather, a separate and a new principal entity to whom the Central Government's 26^th July, 2004 notification, even if otherwise valid, did not apply. The Single Bench apparently agreed, holding that "the notification itself has become irrelevant in view of the privatization of the airports and a new notification will have to be issued by the appropriate government. 71. To address these claims, it is important to analyse the definition of "establishment". Section 2(1)(e) of the CLRAA defines "establishment" as follows: " 'establishment' means - c) any office or department of the Government or a local authority, or d) any place where any industry, trade, business, manufacture or occupation is carried on." 7....
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....se, DIAL would need to be able to assert the following, adopted from the CLRAA definition of contractor excerpted above. "DIAL does not undertake to produce any result for AAI establishment. Instead, DIAL undertakes to produce result for its own establishment" 78. DIAL while performing work on behalf of AAI, it is not performing work on behalf of AAI establishment. Instead, it is merely working on behalf of its own establishment. 79. Further, all the independence DIAL does have, the AAI Act and OMDA make it clear that AAI maintains ultimate responsibility for the airport. 80. The question that has to be answered is who has control of the entire establishment? Noticing that air traffic services and security are the heart of the airport and also noticing the clauses of OMDA providing for overall supervision of DIAL by AAI, checking of accounts, step in rights of AAI and so on, it must be concluded that AAI has overall control of the airport site. 81. Admittedly, DIAL has been leased out the portion of AAI's work, which DIAL only has incomplete control over as well as the fact that DIAL meets the definition of a contractor under the CLRAA, further suggests tha....
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....t approval of the Central Government according to the mandate of Section 12A of the AAI Act. In this view of the matter, it is abundantly clear that DIAL functions "under the authority" of the Central Government; (ii) AAI clearly acts under the authority of the Central Government and DIAL acts under the authority of AAI because of its contract with DIAL. Then it can be logically stated that DIAL works under the authority of the Central Government; (iii) The Central Government has given AAI responsibility for overseeing the airports. To fulfil its obligations, AAI contracted with DIAL. However, it is clear that DIAL's work "concerns" AAI, if DIAL does not perform its work properly or adequately, then AAI will be breaching its statutory obligation and would be responsible for the consequences. (iv) AAI is under an obligation to follow the directions of the Central Government and if DIAL has admittedly assumed those obligations through the OMDA, then DIAL is presumably also obligated to follow such directions. Again, a contrary interpretation would allow AAI to circumvent the Central Government's exercise of authority over its work merely by contract....
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....han a contractor for AAI establishment. That being the case, notification dated 26th July, 2004 directed at AAI establishment must also apply to DIAL. (xi) The contention of DIAL that it would not be bound by the obligation of AAI establishment would lead to absurd consequences. The Division Bench in the impugned judgment has rightly pointed out that every time a fresh agreement is entered into, the entire process of getting a notification issued by the appropriate government in relation to the same work of trolley retrieval and with the same establishment via-a-vis such private player must be repeated. But this interpretation would defeat the rights of the workmen which are meant to be protected by the CLRAA. (xii) In the impugned judgment, the Division Bench of the High Court has correctly held that the obligation flowing from the said notification under Section 10(1) CLRAA should continue to bind every private player that steps into the shoes of AAI. 86. For the foregoing reasons, it is clear that the notification dated 26th July, 2004 was equally binding on DIAL under the CLRAA and, therefore, DIAL must abolish all contract labour as per the terms of the no....