# 13 (ADDL.) S.C.R. 1115 M/S. DELHI INTERNATIONAL AIRPORT PVT. LTD v. UNION OF INDIA & ORS

- **Citation:** [2011] 13 S.C.R. 1115
- **Court:** Supreme Court of India
- **Decided:** 2011-09-15
- **Case number:** Civil Appeal No. 7872 of 2011
- **Bench:** Dalveer Bhandari, Deepak Verma
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/13-addl-s-c-r-1115-m-s-delhi-international-airport-pvt-ltd-v-union-of-india-ors-27253
- **Pages:** 52

## Headnote

Contract Labour (Regulation and Abolition) Act, 1970 -
A
B
ss. 10(1) and 12A - Issuance of Notification by the Central
Government u/s. 10 (1) prohibiting employment of contract C
labour of trolley retrievals in the establishment of the Airporl
Authority of India (AA/) at the Indira Gandhi International
Airporl and Domestic Airporl at Delhi - Delhi International
Airporl Private Limited (DIAL), private underlaking coming into
existence after the issuance of the said Notification, taking D
over the Airporls (Domestic and International) - Applicability
of the said Notification to DIAL - Appropriate government for
DIAL under the CLRAA and ID Act -
Held: Central
Government is the appropriate government for DIAL and AA/
under the CLRAA and ID Act - Entire functioning of DIAL is E
fully dependent on the grant of permission by the Central
Government - Thus, DIAL operates and functions under the
authority of the Central Government - Central Government's
notification was _issued before Operation, Management,
Development and Agreement (OMDA) was signed, by virlue
F
of which DIAL stepped into the shoes of AA/ - DIAL expressly
assumed the 'rights and obligations associated with the
operation and management of the airporl' through OMDA -
DIAL was transferred all of AAf's responsibilities at the airporls
except cerlain reserved functions which means that DIAL only G
had incomplete control, thus, DIAL was nothing more than a
contractor for AA/ establishment and was not a principal
employer of an independent establishment - Thus, the said
Notification, directed at AA/ establishment, was equally
1115
H
1116 SUPREME COURT REPORTS [2011] 13 (ADDL.) S.C.R.
A binding on DIAL under the CLRAA - DIAL to abolish all
contract labour as per the terms of the notification - In the
interest of justice, DIAL directed to pay Rupees five lacs to
each of the erstwhile workers of DIAL who were working for
them as trolley retrievers till 2003 - Industrial Disputes Act,
B 1947.
136 workers were employed by the contractor TOI
Company to do the work of trolley retrieving at the
Domestic and at the International Airport at Delhi in the
year 1992. The workmen approached the Contract
C Labour Court seeking abolition of contract labour system
and their absorption as regular employees. On 26th July
2004, the Central Government issued a Notification
abolishing the contract labour system. Airports Authority
of India (AAI) which had come into force challenged the
D notification. The High Court held that the present
proceedings could not be proceeded with till the matter
was resolved by the High Powered Committee (HPC) and
as such the matter went to the HPC and the Notification
was not given effect to. Meanwhile, the said 136 workers
E were removed from service in the year 2003 as the
contract of TOI Company tame to an end and a new
contractor 'SH' came in its place. Thereafter, from 4th
April 2006, a new private entity, Delhi International Airport
Private Limited (DIAL) took over the Airports (Domestic
F and International). 136 workers filed a writ petition praying
for their absorption in service as regular employees and
for implementation of the Notification dated 26th July,
2004. The Single Judge of the High Court dismissed the
writ petition holding that the establishment of AAI is no
G longer in existence and has changed and as such, the
Notification dated 26th July, 2004 cannot be applied to the
new entity DIAL and the appropriate government shall
have to issue a fresh Notification. Indira Gandhi
International Airport TOI Karamchari Union and Union of
H
DELHI INTERNATIONAL AIRPORT PVT. LTD. v.
1117
UNION OF INDIA & ORS.
India filed separate LPA's. During pendency of the LPA's
A
the Chief Labour Commissioner, Government of India
passed an order holding that the appropriate government
for DIAL is the Central Government and the documents
and file relating to DIAL were sent to the Central
Government. DIAL filed a writ petition. AAI filed another B
writ petition challenging

## Text

_Characters 0–39,355 of 95,573. This is a partial read: ask again with offset=39355 for what follows._

[2011) 13 (ADDL.) S.C.R. 1115
M/S. DELHI INTERNATIONAL AIRPORT PVT. LTD.
v.
UNION OF INDIA & ORS.
(Civil Appeal No. 7872 of 2011 etc.)
SEPTEMBER 15, 2011
[DALVEER BHANDARI AND DEEPAK VERMA, JJ.]
Contract Labour (Regulation and Abolition) Act, 1970 -
A
B
ss. 10(1) and 12A - Issuance of Notification by the Central
Government u/s. 10 (1) prohibiting employment of contract C
labour of trolley retrievals in the establishment of the Airporl
Authority of India (AA/) at the Indira Gandhi International
Airporl and Domestic Airporl at Delhi - Delhi International
Airporl Private Limited (DIAL), private underlaking coming into
existence after the issuance of the said Notification, taking D
over the Airporls (Domestic and International) - Applicability
of the said Notification to DIAL - Appropriate government for
DIAL under the CLRAA and ID Act -
Held: Central
Government is the appropriate government for DIAL and AA/
under the CLRAA and ID Act - Entire functioning of DIAL is E
fully dependent on the grant of permission by the Central
Government - Thus, DIAL operates and functions under the
authority of the Central Government - Central Government's
notification was _issued before Operation, Management,
Development and Agreement (OMDA) was signed, by virlue
F
of which DIAL stepped into the shoes of AA/ - DIAL expressly
assumed the 'rights and obligations associated with the
operation and management of the airporl' through OMDA -
DIAL was transferred all of AAf's responsibilities at the airporls
except cerlain reserved functions which means that DIAL only G
had incomplete control, thus, DIAL was nothing more than a
contractor for AA/ establishment and was not a principal
employer of an independent establishment - Thus, the said
Notification, directed at AA/ establishment, was equally
1115
H
1116 SUPREME COURT REPORTS [2011] 13 (ADDL.) S.C.R.
A binding on DIAL under the CLRAA - DIAL to abolish all
contract labour as per the terms of the notification - In the
interest of justice, DIAL directed to pay Rupees five lacs to
each of the erstwhile workers of DIAL who were working for
them as trolley retrievers till 2003 - Industrial Disputes Act,
B 1947.
136 workers were employed by the contractor TOI
Company to do the work of trolley retrieving at the
Domestic and at the International Airport at Delhi in the
year 1992. The workmen approached the Contract
C Labour Court seeking abolition of contract labour system
and their absorption as regular employees. On 26th July
2004, the Central Government issued a Notification
abolishing the contract labour system. Airports Authority
of India (AAI) which had come into force challenged the
D notification. The High Court held that the present
proceedings could not be proceeded with till the matter
was resolved by the High Powered Committee (HPC) and
as such the matter went to the HPC and the Notification
was not given effect to. Meanwhile, the said 136 workers
E were removed from service in the year 2003 as the
contract of TOI Company tame to an end and a new
contractor 'SH' came in its place. Thereafter, from 4th
April 2006, a new private entity, Delhi International Airport
Private Limited (DIAL) took over the Airports (Domestic
F and International). 136 workers filed a writ petition praying
for their absorption in service as regular employees and
for implementation of the Notification dated 26th July,
2004. The Single Judge of the High Court dismissed the
writ petition holding that the establishment of AAI is no
G longer in existence and has changed and as such, the
Notification dated 26th July, 2004 cannot be applied to the
new entity DIAL and the appropriate government shall
have to issue a fresh Notification. Indira Gandhi
International Airport TOI Karamchari Union and Union of
H
DELHI INTERNATIONAL AIRPORT PVT. LTD. v.
1117
UNION OF INDIA & ORS.
India filed separate LPA's. During pendency of the LPA's
A
the Chief Labour Commissioner, Government of India
passed an order holding that the appropriate government
for DIAL is the Central Government and the documents
and file relating to DIAL were sent to the Central
Government. DIAL filed a writ petition. AAI filed another B
writ petition challenging the said notification. The Division
Bench of the High Court held that in relation to airport, it
is the Central Government which is the appropriate
government for the purpose of CLRAA; and that DIAL is
equally bound by the Notification dated 26th July, 2004 c
issued by the Central Government. The review petition
filed by the Union of India was also disposed of.
Aggrieved, DIAL, AAI and the Indira Gandhi International
Airport TOI Karamchari Union filed the instant appeals.
The question which arose for consideration in these D
appeals are as to who is the appropriate government for
DIAL under the CLRAA and ID Act; that whether the
Notification dated 26th July, 2004 issued by the Central
Government under Section 10 (1) of the CLRAA
prohibiting employment of contract labour of trolley E
retrievals in the establishment of the Airport Authority of
India at the Indira Gandhi International Airport and
Domestic Airport.at Delhi would be applicable to DAIL
which only came into existence on 4th April, 2006.
F
Disposing of the appeals, the Court
HELD: 1.1. Section 2(a) of the Contract Labour
(Regulation and Abolition) Act, 1970 makes it clear that
the Central Government would be the "appropriate
government" under CLRAA for any establishment for G
whom the Central Government is the "appropriate
government" under the Industrial Disputes Act. Section
2(a) of the ID Act indicates that the Central Government
is the "appropriate authority" in three relevant situations
H
1118 SUPREME COURT REPORTS [2011) 13 (ADDL.) S.C.R.
A wherein both Airport Authority of India (AAI) and the air
transport service have been specifically incorporated
itself. Thus, if Delhi International Airport Private Limited
(DIAL) industry is carried on under the authority of the
Central Government, the dispute in question can be said
B to concern AAI or if the dispute in question can be said
to concern air transport service, then the Central
Government is the appropriate authority both for ID Act
and CLRAA. It may be pertinent to properly comprehend
the relevant stah1te. [Paras 33 and 34) [1145-F-H; 1146C A-D-E]
1.2. The AAI Act was constituted for the better
administration and cohesive management of airports and
civil enclaves whereas air transport services are operated
or are intended to be operated and of all aeronautical
D communication stations for the purpose of establishing
or assisting in the establishment of airports and for
matters connected therewith or incidental thereto. [Para
35) [1146-F-G]
E
1.3. It is clear from Section 12A that AAI may in public
interest or in the interest of a better management of the
airport, make a foase of the premises of the airport to
carry out some of its functions under Section 12 as the
Authority may deem fit. Detailed functions of the Authority
F have been enumerated in Section 12 .. Out of those
functions under Section 12A, some functions can be
delegated on lease in the public interest or in the interest
of better control and management of the airports.
Consequently, in pursuance of the agreement with DIAL,
some functions of AAI were leased out to DIAL. DIAL
G
H
derives its authority from AAI and AAI derives its authority
from the powers given by the Central Government. In the
impugned judgment, the Division Bench clearly held that
AAI works "under the authority" of the Central
Government [Paras 38, 39 and 40) [1147-H; 1148-A-B-E]
DELHI INTERNATIONAL AIRPORT PVT. LTD. v.
1119
UNION OF INDIA & ORS.
1.4. A close reading of the objects and reasons
A
indicates that the Central Government under Section 12A
of the AAI Act has retained the power to give directions
in the public interest or in the interest of better
management to lease the premises of the airport to carry
out some of its functions under Section 12A, as the
B
authority may deem fit. Some of its (AAl's) functions have
been leased out to DIAL. This has been done under
Section 12A(2) with the previous approval of the Central
Government. On proper scrutiny of the provisions of the
AAI Act, it is abundantly clear that the Central Government c
has control over AAI and AAI has control over DIAL. [Para
42] [1150-E-F]
1.5. 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
D
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 AAl's
functions (in the public interest or in the interest of better
management of airports). It was this proviso which
E
allowed AAI to assign some of its functions to DIAL
through Operation, Management, Development and
Agreement (OMDA), responsibility for trolley collection
services at the Indira Gandhi International Airport and the
domestic airport. [Para 45) [1151-E-F]
F
1.6. 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 G
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
H
1120 SUPREME COURT REPORTS [2011] 13 (ADDL.) S.C.R.
A are 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'. [Para 50)
B [1153-A-C)
1. 7. In case the Central Government had never
granted permission, pursuant to Section 12A of the AAI
Act, DIAL would not be able to carry out functions at the
C Delhi airports. The entire functioning of DIAL is fulty
dependent on the grant of permissron by the Central
Government. The undertakings need not be government
undertal<ings to have had authority conferred upon them.
But the word "government" clearly modifies "company."
However, tt cannot modify "undertaking," for the phrase
D "government/any undertaking". Thus, it would seem that
any "undertaking"- even private undertakings, like DIAL
- may function "under the authority" of the Central
Government. Whether or not they do it, "a question of fact
which has to be ascertained on the facts and in the
E circumstances of each case." In the facts ·and
circumstances of these cases, it is abundantly clear that
DIAL operates under the authority of the Central
Government [Paras 52, 53 and 54) [1153-G-H; 1154-D-E)
F
1.8. The functions and powers .of DIAL in relation to
the Delhi airports are traceable to Section 12A of the AAI
Act. Without Central Gov.ernment's permission, AAI could
not have delegated any power to DIAL. In other words,
the functioning of DIAL at the Delhi airports itself was fully
G dependent on the approval of the Central Government.
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". [Para 55) [1154-F-H]
H
DELHI INTERNATIONAL AIRPORT PVT. LTD. v.
1121
UNION OF INDIA & ORS.
1.9. DIAL does not explain how having the State
A
Government as the appropriate government - the only
alternative under CLRAA and ID Act - would be any more
conducive to· privatization. The Central Government does
not impede privatization any more than the State
Government; after all, it was the Central Government that
B
sought to encourage privatization through the AAI Act by
incorporating Section 12A in the Act. [Para 56] (1155-BC]
1.10. In case AAI and DIAL act under the authority of
different governments it would bring about absurd C
results: AAI could simply circumvent potential Central
Government orders by delegating various functions to
third parties, such as DIAL. AAI would need to obtain
Central Government approval prior to making such a
delegation under Section 12A of the AAI Act, but it D
nevertheless seems unlikely that the Central Government
would intend to maintain authority over AAl's actions,
while allowing actions performed by other entities on
behalf of AAI, such as DIAL, to be carried out under the
authority of the State Government. DIAL made no E
suggestions as to why the Central Government might
have intended such a result while drafting the AAI Act and
CLRAA, and there is, therefore, little justification for
coming to such a conclusion. [Para 57] (1155-D-E]
F
1.11. DIAL expressly assumed the "rights and
obligations associated with the operation and
management of the airport" through OMDA. While
Section 12A of the AAI Act only notes that the "powers
and functions" of AAI will be transferred to its lessors, it G
is "inconceivable that by virtue of Section 12A the
powers and functions of AAI will stand transferred and
not the corresponding obligations." If it was the
"obligation" of AAI to follow valid directions of the Central
Government by virtue of its status as an enumerated
H
1122 SUPREME COURT REPORTS (2011] 13 (ADDL.) S.C.R.
A industry, and if DIAL has admittedly assumed those same
obligations through 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
B by contracting it out to third parties. It is abundantly clear
that the Central Government is the appropriate
government qua DIAL and consequently the said
Notification of 26th July, 2004 is equally applicable to
DIAL. Under the ID Act (and therefore, CLRAA), the third•
c situation in which the Central Government is the-
"appropriate Government" is "in relation to industrial•
disputes concerning air transport services." [Paras 58•
and 59] [1155-G-H; 1156-A-C]
1.12. Trolley retrievers themselves are not physicallY"
P transporting anything by air. However, it is entirelY"
possible that the drafters of the AAI Act did not intend toi
restrict the coverage of this provision merely to pilots,.
stewardesses, and others engaged in the actual, physicall
transport of people and objects, as DIAL would havei
E liked the Court to believe. Trolleys at airports relate to ai11
transportation- just as they relate to "a single flight or a.
series of flights." [Para 60) [1156-E]
1.13. At the time of amendment when private airlinem
F operators had started functioning and as "air transpor1
service" they included all airline operators, private 011
public and the said industry was included as arenumerated industry. Thus, the "air transport service'
concerns airline operators only. DIAL is not e~gaged irG the business of operating an airline for carryin~
passengers and goods by air through flights. In fact, AAis also not involved in this activity and Section 12 of tha
AAI Act which lists out the functions of AAI does no•
include the function of carrying people and good9
through air by flights operated by it. As such, when AAH
DELHI INTERNATIONALAIRPORT PVT. LTD. v.
1123
UNION OF INDIA & ORS.
es not perform such function then there is no question
A
transfer of such functions to DIAL. [Paras 62 and 64)
156-H; 1157-C]
1.14. It is the duty of the authority to provide all air
ansport services at the airport, and if it is not the duty
8
the authority to carry passengers and goods by air
rough flights, then by the appellants own logic, air
ansport service must mean more than the mere
arriage of passengers and goods by air through flights.
it did not, then there would be no reason that "air C
ansport service" would be listed as a "duty of the
•uthority" under Section 12(2). This Section clearly
odlcates that it is the duty of the Authority to provide "air
.ans port service", such duty does not mean that the
dthority provides such services itself. AAI is responsible
"Ider the AAI Act for providing air transport service D
iould not necessarily mean that DIAL also does so.
aras 65 and 66) [1157-E-F]
1.15. In the instant case, under Section 12A of the AAI
-:t all functions were given to DIAL except watch and
E
erd function, air traffic service and civil enclaves. From
e provisions of OMDA, it was clear that all functions of
l\I barring reserved activities and all land except certain
1rved out assets were given to DIAL. DIAL admitted that
111 transferred to it all functions except those related to
F
itch and ward, air traffic service and civil enclaves,
-ne of which could be considered as "air transport
irvice". That being the case, AAI must have transferred
duty to provide "air transport service" to DIAL and the
1ntral Government must, therefore, be the appropriate
G
•vernment for DIAL under the CLRAA and ID Act. [Para
68] [1157-G-H; 1158-A-B]
1.16. Section 10(1) of the CLRAA permits the
opropriate government" to "prohibit employment of
'ltract labour in any process, operation or other work
H
1124 SUPREME COURT REPORTS [2011) 13 (ADDL.) S.C.R.
A in any establishment. The Central Government's 26th
July, 2004 notification clearly forbade the "AAI
establishment" from employing trolley retrievers as
contract labour. [Para 69] [1158-D]
8
1.17. The provision s. 291)(e) makes it clear, the
definition of "establishment" focuses either on (1) Place;
or (2) Offices or departments of the Government or a
local authority. The 26th July, 2004 notification must,
therefore, have been directed at one of these types of
C establishments. [Para 72] [1159-C]
1.18. On the one hand, AAI clearly cannot be
considered a lbcal authority as it is charged with
managing airports throughout India. On the other hand,
AAI also cannot be considered an "office or department
D of the Government". The AAI Act makes clear that AAI
must, in certain circumstances, obtain approval from the
Central Government, thereby implying that AAI is not
itself the Central Government. Therefore, "establishment"
in this case cannot refer to "any office or department of
E the Government or a local authority", it must refer to a
"place where any industry, trade, business, manufacture
or occupation is carried on". The Division Bench in the
impugned judgment held that the establishment for the
purposes of the CLRAA is a place where the industrial,
F trade or business activity is carried on then it necessarily
follows in the context of the instant case that it is the
Delhi Airports which constitute the establishment of AAI
and in turn the establishment of DIAL. There could be
multiple establishments at the airport. That being the
G case, the Division Bench's assertion that the
establishment of Ml is in turn the establishment of DIAL
must be justified. (Paras 73, 75] (1159-D-G; 1160-B]
1.19. DIAL while performing work on behalf of AAI, it
is not performing work on behalf of AAI establishment.
H Instead·, it is merely working on behalf of its own
DELHI INTERNATIONAL AIRPORT PVT. LTD. v.
1125
UNION OF INDIA & ORS.
establishment. Further, all the independence DIAL does
A
have, the AAI Act and OMDA make it clear that AAI
maintains ultimate responsibility for the airport. (Paras78
and 79] [1160-G)
1.20. Noticing that air traffic services and security are
B
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. [Para 80) [1161 ·Al
1.21. DIAL has been leased out the portion of AAl'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 that DIAL
c
is nothing more than a contractor for AAI establishment. o
DIAL is not, in other words, a principal employer of an
independent establishment That being the case, the 26th
July, 2004 notification, declared at AAI establishment,
must also apply to DIAL. (Para 81] (1161-C]
1.22. DIAL falls under AAI establishment. Clause 5.1
E
of OMDA, which notes that the "rights and obligations
associated with the operation and management of the
·Airport would stand transferred to" DIAL, would seem to
suggest that orders given to AAI establishment would
also apply to DIAL establishment, even if the two were,
F
as DIAL claims, separate establishments. If AAI
establishment is obligated to abolish contract labour and
DIAL establishment (even If it is somehow separate) has
assumed AAI establishment's obligations through the
OMDA, then DIAL is presumably required to fulfil those
G
obligations. Critical to this inference is the fact that the
Central Government's 26th July, 2004 notification was
issued before OMDA was signed. (Para 83] [1161-E-G]
1.23. In the impugned judgment, the Division Bench
H
1126 SUPREME COURT REPORTS (2011] 13 (ADDL.) S.C.R.
A correctly observed 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 vis-a-vis such private player" must be
B repeated. This interpretation would defeat the rights of
the workers, which are meant to be protected by CLRAA.
The Division Bench correctly observed that the
obligation flowing from the notification under Section
10(1) CLRAA should continue to bind every private player
C that steps into the shoes of AAI. [Para 84) [1162-A-C]
D
E
F
G
H
2. The Central Government is the appropriate
government for DIAL for the following reasons -
(i)
DIAL could not have entered into a contract
with AAI without approval of the Central
Government according to the mandate of
Section 12A of the AAI Act. 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. 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 would
be breaching its statutory obligation and
would be responsible for the consequences.
(iv) AAI is under an obligation to follow the
DELHI INTERNATIONAL AIRPORT PVT. LTD. v.
1127
(v)
(vi)
(vii)
UNION OF INDIA & ORS.
directions of the Central Government and if A
DIAL.'!· has admittedly assumed those
obligations through the OMDA, then DIAL is
presumably also obligated to follow such
directions. A contrary interpretation would
allow AAI to circumvent the Central
8
Government's exercise of authority over its
work merely by contracting it out to third party
(DIAL).
Clause 5.1 of the OMDA specifically notes that
the "rights and obligations associated with the C
operation and management of the Airport
would stand transferred" to DIAL. If AAI was
admittedly obligated to follow the 26th July,
2004 notification and DIAL has assumed all of
AAl's obligations, the11 DIAL must also be D
obligated to follow the notification. In other
words, the notification issued by the Central
Government is equally binding on DIAL.
Holding the 26th July, 2004 notification
E
inapplicable to DIAL would mean that the
Government would have to issue separate
notification every time AAI contracts with a
third party. This would clearly violate the basic
objects and reasons of CLRAA.
The security of contract labour working for AAI
envisaged, a law cannot be made to depend
F
on the private sector. If the legislature had
found it fit to specifically include AAI as an
enumerated industry under the ID Act, it is G
extremely unlikely that it would have intended
for AAI to be able to circumvent the Central
Government orders by contracting with
private parties.
H
1128 SUPREME COURT REPORTS [2011] 13 (ADDL.) S.C.R.
A
(viii) The privatization of the airports does not mean
that the "appropriate government" cannot be
the Central Government. The definition of
'establishment' in the CLRAA takes in Its fold
purely private undertakings. Concerns about
8
privatization are, therefore, unfounded.
c
D
E
F
G
H
(ix)
Under Section 12(2) of the AAI Act, AAI Is
obliged to provide air traffic service and air
transport service at the airport. DIAL admits
that AAI transferred all of ltS responsibilities at
the airports with the exception of certain
reserved
functions.
Since
Industries
concerning air transport service function
under the authority of the Central Government,
and since AAI transferred its "air transport
service" responsibilities to DIAL, the Central
Government must be held to be the appropriate
Government for DIAL
(x)
The OMDA makes it clear that AAI maintains
ultimate responsibility for the airports. The fact
that DIAL was transferred only a portion of
AAl's work which DIAL only has incomplete
control over as well as the fact that DIAL
meets the definition of a contractor under the
CLRA Act further suggests that DIAL is
nothing more than 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 establisnment
would lead to absurd consequencr.s. The
Division Bench in the impugned judgment has
rightly pointed out that every time a fresh
agreement is entered into, the entire process
DELHI INTERNATIONAL AIRPORT PVT. LTD. v.
1129
UNION OF INDIA & ORS.
of getting a notification issued by the A
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
B
are meant to be protected by the CLRAA.
(xii) In the impugned judgment, the Division Bench
of the High Ceurt correctly held that the
obligation flowing from the said notification C
under Section 10(1) CLRAA should continue to
bind every private player that steps into the
shoes of AAI. [Para 85] [1162-D-H; 1163-A-H;
1164-A-H; 1165-A-B]
Steel Authority of India Limited & Others etc. etc. v.
D
National Union Water Front Workers and Others etc. etc.
(2001) 7 sec 1 - relied on.
3.1. It is clear that the notification dated 26th July,
2004 was equally binding on DIAL under the CLRAA and,
E
therefore, DIAL must abolish all contract labour as per the
terms of the notification. [Para 86] [1165-C]
3.2. The Central Government notification dated 26th
July, 2004 is clearly binding and applicable to DIAL.
DIAL's obligation with regard to the contract labour in
F
general is clear from the said notification. They are liable
to be regularized as regular employees of DIAL. DIAL
replaced many of the workers with other trolley retrievers
and it would be unrealistic to expect DIAL to regularize
· the employment of their current trolley retrievers and
G
member of the workers' union alike and inequitable to
leave the current workers jobless so as to make room for
erstwhile workers of DIAL [Para 87] [1165-D-E]
3.3. In view of the peculiar facts and circumstances
H
1130 SUPREME COURT REPORTS [2011] 13 (ADDL.) S.C.R.
A of these cases directing DIAL to regularize services of
trolley retrievers who worked with DIAL till 2003 would be
harsh, unrealistic and not a pragmatic approach,
therefore, in the interest of justice, DIAL is directed to pay
Rupees five lacs to each of the erstwhile 136 workers of
B DIAL who were working for them as trolley retrievers till
2003 and in case any worker has expired, then his or her
legal heirs would be entitled to the said amount. This
compensation is paid to the work.ers in lieu of their
permanent absorption/reinstatement with DIAL and their
c claim of back wages. This is in full and final settlement
of entire claims of erstwhile 136 workers of DIAL. [Para
88] [1165-G-H; 1166-A]
, Oil and Natural Gas Commission and Anr. vs. Collector
of Central Excise 1992 Suppl. (2) SCC 432; Gammon India
D Ltd. and Ors. v. Union of India (UO/) and Ors. (1974) 1 SCC
596: 1974 (3) SCR 665 - referred to.
E
Case Law Reference:
1992 Suppl. (2) sec 432 Referred to.
1974 (3) SCR 665
Referred to.
(2001) 1 sec 1
Relied on.
Para 7
Para 14
Para 85
CIVIL APPELLATE JURISDICTION : Civil Appeal No.
F 7872 of 2011.
G
From the Judgment & Order dated 18.12.2009 of the High
Court of Delhi at New Delhi in W.P. {C) No. 139 of 2008.
WITH
C.A. Nos. 7873, 7874, 7875, 7876, 7878-79 of 2011.
P.P. Malhotra, ASG, R.F. Nariman, Dr. A.M. Singhvi,
Sudhir Chandra, Chander Udai Singh, Colin Gonsalves, Atul
H Sharma, Saket Singh, Milanka Chaudhary, Sarojanand Jha,
DELHI INTERNATIONAL AIRPORT PVT. LTD. v.
1131
UNION OF INDIA & ORS.
Sunil Fernandes, Atul Sharma, Abhishek Sharma, Lalit Bhasin,
A
Nina, Gupta Ratna Dhingra, Mudit Sharma, Bina Gupta, Tariq
Adeed, Alin Mahanta, Divya Jyoti (for Jyoti Mendiratta), Rachna
Joshi lssar Chetan Chawla, Samridhi Sinha (for Shreekant N.
Terdal) for the appearing parties.
The Judgment of the Court was delivered by
DALVEER BHANDARI, J. 1. Leave granted in all the
Special Leave Petitions.
B
2. These appeals emanate from the judgment of the High c
Court of Delhi 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 }8, 2009.
3. The short question which arises for consideration in
these appeals is whether the Notification dated 26th July, 2004
D
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
E
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 appe'als preferred
before this Court against the following Letters Patent Appeals
F
and Writ Petitions decided by the High Court:
(a)
Indira Gandhi lntemational Airport TD/ Karamchari
Union v. Union of India and others - LPA No.38
of 2007
This Letters Patent Appeal was filed against the judgment
G
of the learned Single Judge dated 28th November, 2006 in Writ
Petition (C) No.15156 of 2006. The workers' Union had
preferred the writ petition for seeking implementation of the
Notification of prohibition dated 26th July, 2004 and for
H
1132 SUPREME COURT REPORTS (2011] 13 (ADDL.) S.C.R.
A absorption in service amongst other things. The learned Single
Judge took notice of the fact that from 4th April, 2006 a new
private entity, DIAL had taken over the Airports (Domestic and
International). Hence at the airport, there was no longer any
establishment of AAI existing but a new establishment of DIAL
B was operating due to which the notification dated 26th July,
2004, prohibiting the engagement of contract labour in trolley
retrieval activity in the establishment of AAI at the Delhi Airports
could not automatically apply to the new entity, DIAL and a new
notification by the appropriate government would have to be
C issued.
(b)
Union of India v. Indira Gandhi International
Airport TOI Karamchari Union - LPA No.1065 of
2007
D
This Letters Patent Appeal was preferred by the Union of
E
F
India against the learned Single Judge's judgment dated 28th
November, 2006 passed in Writ Petition (C) No.15156 of 2008
on a very limited point of certain observation in the judgment.
(c)
Airports Authority of India v. Union of India Writ
Petition (Cl No.6763 of 2008
AAI after getting permission of the High Powered
Committee to go ahead with the litigation challenged the
notification dated 26th July, 2004 by filing the said writ petition.
(d)
Delhi International Airports P.Ltd. v. Union of
India Writ Petition (Cl No.139 of 2008
DIAL had preferred this writ petition challenging the order
of the Chief Labour Commissioner, Government of India dated
G 24th September, 2007 by which the Central Government was
held to be the 'appropriate government' for DIAL for the
purposes of Industrial Disputes Act, 1947 (hereinafter referred
to as "ID Act") and CLRAA. The order dated 22nd November,
2007 of Chief Secretary, Government of NCT of Delhi by which
H
DELHI INTERNATIONAL AIRPORT PVT. LTD. v.
1133
UNION OF INDIA & ORS. (DALVEER BHANDARI, J.]
all documents concerning DIAL were directed to be shifted to
A
the Central Government machinery was also impugned.
5. Both the writ petitions of AAI and DIAL were heard and
disposed of by the Division Bench of the High Court along with
these LPAs by the impugned judgment.
8
BRIEF FACTS:
6. 136 workers were employed by the contractor Mis. TDI
International Pvt. Ltd. to do the work of trolley retrieving at the
Domestic and at the International Airport at Delhi in the year c
1992. In view of the perennial nature of the work, the workmen
approached the Contract Labour Couit for aboUtion 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
D
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
E
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
F
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 G
retrievers by the contractor Mis. TOI International Private Limited
working at the airport since 1992 were removed from service
on 5th December, 2003 as the contract of Mis. TOI International
Private Limited had come to an end and a new contractor
H
1134 SUPREME COURT REPORTS 12011] 13 (ADDL.) S.C.R.
A Sindhu Holdings came in its place.· These 136 members filed
Writ Petition No.15156 of 2006 before the learned Single
Judge of the High Court of Delhi praying for their absorption in
service as regular employees and for implementation of the·
notification dated 26th July, 2004.
B
9. The learned Single Judge of the High Court after
hearing the parties including DIAL vide judgment dated 28th
November, 2006 held that the establishment of AAI is no longer
in existence and has changed. As such, the notification dated
c 26th July, 2004 cannot be applied to the new entity DIAL. The
appropriate government shall have to issue a fresh notification.
Consequently, the Writ Petition filed by the said 136 workers
stood dismissed by the learned Single Judge of the High Court.
10. Indira Gandhi International Airport TOI Karamchari
D Union preferred LPA No.38 of 2007 against the judgment of
the learned Single Judge. The Union of India also preferred LPA
No.1065 of 2007 against the judgment of the learned Single
Judge.
E
11. During the pendency of these LPAs, an order dated
24th September, 2007 was passed by the Chief Labour
Commissioner, Government of India holding that the
appropriate government for DIAL is the Central Government.
By order dated 22nd November, 2007 the documents and file
F relating to DIAL were sent to the Central Government. These
orders were challenged by DIAL in Writ Petition (C) No.139 of
2008. After getting the permission, AAI filed another Writ
Petition (C) No.6763 of 2008 challenging the said notification
on merit. The Division Bench of the High Court heard all these
G
matters together and passed the impugned order of 18th
December, 2009.
12. The review petition was preferred py the Union of India
which was decided on 12th March, 2010 by the High Court
modifying para 61 of the impugned judgment. Against the
+
H
DELHI INTERNATIONAL AIRPORT PVT. LTD. v.
1135
UNION OF INDIA & ORS. [DALVEER BHANDARI, J.)
impugned judgment of the Division Bench of the High Court,
A
two appeals were preferred by DIAL and three by AAI and one
by the Indira Gandhi International Airport TOI Karamchari Union.
In these appeals, two broad issues that arise are:
(a) Who is the appropriate government for DIAL under the
B
CLRAA and ID Act? This is the subject matter of SLP (C)
No.369 of 2010 filed by DIAL.
(b) Whether the notification dated 26th July, 2004 is
applicable to DIAL as it is issued by the Central
Government which is not the appropriate government for
C
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.
D
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
E
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
F
forum for the adjudication of any dispute arising between the
contract. labour and ·the ~rincipal 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 G
India (UOI) and Others (1974) 1 sec 596 which reads as
under:-
"The Act was passed to prevent the exploitation of contract
labour and also to introduce better conditions of work. The
H
A
B
c
1136 SUPREME COURT REPORTS [2011] 13 (ADDL.) S.C.R.
Act provides for regulation and abolition of contract labour.
The underlying policy of the Act is to abolish contract
labour, wherever possible and practicable, and where it
cannot be abolished altogether, the policy of the Act is that
the working conditions of the contract labour should be so
regulated as to ensure payment of wages and provision
of essential amenities. That is why the Act provides for
regulated conditions of work and contemplates
progressive abolition to be extent contemplated by
Section 1 O of the Act. Section 1 O of the Act deals with
abolition while the rest of the Act deals mainly with
regulation. The dominant idea of the Section 10 of the Act
is to find out whether contract labour is necessary for the
industry, trade, business, manufacture or occupation which
is carried on in the establishment."
D
15. The Central Government will be the appropriate
government under CLRRA for any establishment for whom the
Central Government is the appropriate government under the
ID Act.