TaxTMI 
TaxTMI 
2010 (12) TMI 1373
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.... a security service agreement dated 2.12.1975 with the second Respondent, for its Mills premises, governed by the provisions of Contract Labour (Regulation & Abolition) Act, 1970 (`CLRA Act' for short). The first Respondent was one of the persons appointed by the second Respondent, and he was deployed for guard duties at the Appellant's Mill on 15.12.1980. The second Respondent discharged the first Respondent from service on 27/28.7.1982. The Appellant terminated the security service agreement with the second Respondent on 16.8.1982. 3. Five years after his termination, in the year 1987, the first Respondent filed an application under Section 31(3) of the Madhya Pradesh Industrial Relations Act, 1960 (for short 'MPIR Act'....
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.... came into force, it would not be possible to rely upon the definition of `employee' under Section 2(13) of MPIR Act to contend that a workman employed by the contractor was a workman of the principal employer. The Industrial Court also held that first Respondent was appointed by the second Respondent. However it held that the agreement between Appellant and second Respondent was sham/nominal and the first Respondent should be treated as a direct employee of Appellant for the following reasons: (i) the Appellant failed to establish by adducing necessary evidence that the salary of first Respondent was not directly paid by it and that it was being paid by the second Respondent and therefore it should be deemed that the Appellant was dire....
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....er the said finding was justified. It is now well-settled that if the industrial adjudicator finds that contract between the principal employer and contractor to be sham, nominal or merely a camouflage to deny employment benefits to the employee and that there was in fact a direct employment, it can grant relief to the employee by holding that the workman is the direct employee of the principal employer. Two of the well-recognized tests to find out whether the contract labour are the direct employees of the principal employer are (i) whether the principal employer pays the salary instead of the contractor; and (ii) whether the principal employer controls and supervises the work of the employee. In this case, the Industrial Court an....
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....ight to regulate employment is with the contractor, and the ultimate supervision and control lies with the contractor. The principal employer only controls and directs the work to be done by a contract labour, when such labour is assigned/allotted/sent to him. But it is the contractor as employer, who chooses whether the worker is to be assigned/allotted to the principal employer or used otherwise. In short, worker being the employee of the contractor, the ultimate supervision and control lies with the contractor as he decides where the employee will work and how long he will work and subject to what conditions. Only when the contractor assigns/sends the worker to work under the principal employer, the worker works under the superv....
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....outs were not known; and that only after the filing of the special leave petition, it could trace the place of employment of the first Respondent and secure the particulars. The certificate produced is a communication dated 17/18.1.2007 from Western Coalfields Ltd., a Govt. of India Undertaking, Nagpur, addressed to the Appellant, stating that the first Respondent took up employment under Western Coalfields Ltd. on 5.6.1985 and that in January, 2007 he was working in Wani area in WCL in Maharashtra and was being paid a gross salary of Rs. 12435/-. This has not been denied or controverted by the first Respondent. 11. The proviso to Section 65(3) of the MPIR Act makes it clear that if the employee had been otherwise employed and receiving ....