# LANCO ANPARA POWER LIMITED v. STATE OF UTTAR PRADESH & ORS

- **Citation:** [2016] 5 S.C.R. 731
- **Court:** Supreme Court of India
- **Decided:** 2016
- **Case number:** Civil Appeal No.6223 of2016
- **Bench:** A.K. Sikri, N.V. Ramana
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/lanco-anpara-power-limited-v-state-of-uttar-pradesh-ors-31484
- **Pages:** 30

## Headnote

A
B
Building and other Construction Workers (Regulation of
Employment and Conditions of Service) Act, 1996 - Buildings and
other Construction Workers Welfare Cess Act,) 996 - Appellants· C
undertaking construction activity wherein they had planned to set
up their factories - ln the process of construction of civil works,
construction workers engaged - Case of respondent authorities
that the appellants to pay the cess for the welfare of the said workers
engaged in the construction work since the provisions of the BOCW
Act and the Welfare Cess Act meant for construction workers became
applicable - Case of the appellants that provisions of the Factories
Act apply to the construction of building/project of the appellants -
Held: Construction workers are not covered by the Factories Act -
Thus, they are entitled to the welfare measures provided for such
workers under BOCW Act and Welfare Cess Act - Appellants to pay
cess for the welfare of the said workers - Factories Act, 1948.
Dismissing the appeals and the petitions, the Court
HELD: 1.1 The construction workers are not covered by
the Factories Act, 1948 and, therefore, welfare measures
specifically provided for such workers under the Building and
other Construction Workers (Regulation of Employment and
Conditions of Service) Act, 1996 and the Buildings and other
Construction Workers Welfare Cess Act, 1996 cannot be denied.
[Para 34)(759-F-G]
1.2 On the conjoint reading of section 2(m), 2(k) & 2(1) of
the Factories Act, it becomes clear that "factory" is that
establishment where manufacturing process is carried on with or
without the aid of power. Carrying on this manufacturing process
or manufacturing activity is thus a prerequisite. It is equally
pertinent to note that it covers only those workers who are
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engaged in the said manufacturing process. Insofar as these
appellants are concerned, construction of building is not their
business activity or manufacturing process. In fact, the building
is being constructed for carrying out the particular manufacturing
process, which, in most of these appeals, is generation,
transmission and distribution of power. Obviously, the workers
who are engaged in construction of the building also do not fall
within the definition of 'worker' under the Factories Act. On these
two aspects there is no cleavage and both parties are at ad idem.
What follows is that these construction workers are not covered
by the provisions of the Factories Act. [Para 21)(753-D-G)
1.3 Having regard to the above, if the submission of the
appellants is accepted, the construction workers engaged in the
construction of building undertaken by the appellants which is to
be used ultimately as factory, would stand excluded from the
provisions of BOCW Act and Welfare Cess Act as well. This could
not be the intention while providing the definition of 'building
and other construction work' in Section 2(d) ofBOCW Act. [Para
22)(753-G-H; 754-A]
1.4 The High Court was right in observing that merely
because the appellants have obtained a licence under Section 6
of the Factories Act for registration to work a factory, it would
not follow therefrom that they answer the description of the
"factory" within the meaning of the Factories Act. A bare reading
of the definition of factory, thereof makes it abundantly clear that
before this stage, when construction of the project is completed
and the manufacturing process starts, 'factory' within the meaning
of Section 2(m) of the Factories Act does not come into existence
so as to be covered by the said Act. [Para 23)[754-B-C)
1.5 Section 2(d) of the BOCW Act dealing with the building
or construction work is in three parts. In the first part, different
activities arc mentioned which are to be covered by the said
expression, namely, construction, alterations, repairs,
maintenance or demolition. Second part of the definition is aimed
at those buildings or works in relation

## Text

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[2016] 5 S.C.R. 731
LANCO ANPARA POWER LIMITED
v.
STATE OF UTTAR PRADESH & ORS.
(Civil Appeal No.6223 of2016)
OCTOBER 18,2016
[A.K. SIKRI AND N.V. RAMANA, JJ.]
A
B
Building and other Construction Workers (Regulation of
Employment and Conditions of Service) Act, 1996 - Buildings and
other Construction Workers Welfare Cess Act,) 996 - Appellants· C
undertaking construction activity wherein they had planned to set
up their factories - ln the process of construction of civil works,
construction workers engaged - Case of respondent authorities
that the appellants to pay the cess for the welfare of the said workers
engaged in the construction work since the provisions of the BOCW
Act and the Welfare Cess Act meant for construction workers became
applicable - Case of the appellants that provisions of the Factories
Act apply to the construction of building/project of the appellants -
Held: Construction workers are not covered by the Factories Act -
Thus, they are entitled to the welfare measures provided for such
workers under BOCW Act and Welfare Cess Act - Appellants to pay
cess for the welfare of the said workers - Factories Act, 1948.
Dismissing the appeals and the petitions, the Court
HELD: 1.1 The construction workers are not covered by
the Factories Act, 1948 and, therefore, welfare measures
specifically provided for such workers under the Building and
other Construction Workers (Regulation of Employment and
Conditions of Service) Act, 1996 and the Buildings and other
Construction Workers Welfare Cess Act, 1996 cannot be denied.
[Para 34)(759-F-G]
1.2 On the conjoint reading of section 2(m), 2(k) & 2(1) of
the Factories Act, it becomes clear that "factory" is that
establishment where manufacturing process is carried on with or
without the aid of power. Carrying on this manufacturing process
or manufacturing activity is thus a prerequisite. It is equally
pertinent to note that it covers only those workers who are
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engaged in the said manufacturing process. Insofar as these
appellants are concerned, construction of building is not their
business activity or manufacturing process. In fact, the building
is being constructed for carrying out the particular manufacturing
process, which, in most of these appeals, is generation,
transmission and distribution of power. Obviously, the workers
who are engaged in construction of the building also do not fall
within the definition of 'worker' under the Factories Act. On these
two aspects there is no cleavage and both parties are at ad idem.
What follows is that these construction workers are not covered
by the provisions of the Factories Act. [Para 21)(753-D-G)
1.3 Having regard to the above, if the submission of the
appellants is accepted, the construction workers engaged in the
construction of building undertaken by the appellants which is to
be used ultimately as factory, would stand excluded from the
provisions of BOCW Act and Welfare Cess Act as well. This could
not be the intention while providing the definition of 'building
and other construction work' in Section 2(d) ofBOCW Act. [Para
22)(753-G-H; 754-A]
1.4 The High Court was right in observing that merely
because the appellants have obtained a licence under Section 6
of the Factories Act for registration to work a factory, it would
not follow therefrom that they answer the description of the
"factory" within the meaning of the Factories Act. A bare reading
of the definition of factory, thereof makes it abundantly clear that
before this stage, when construction of the project is completed
and the manufacturing process starts, 'factory' within the meaning
of Section 2(m) of the Factories Act does not come into existence
so as to be covered by the said Act. [Para 23)[754-B-C)
1.5 Section 2(d) of the BOCW Act dealing with the building
or construction work is in three parts. In the first part, different
activities arc mentioned which are to be covered by the said
expression, namely, construction, alterations, repairs,
maintenance or demolition. Second part of the definition is aimed
at those buildings or works in relation to which the aforesaid
activities are carried out. The third part of the definition contains
exclusion clause by stipulating that it docs not include 'any
building or other construction work to which the provisions of
LANCO ANPARA POWER LIMITED v. STATE OF UTTAR
PRADESH
the Factories Act, 1948, or the Mines Act, 1952 applies'. Thus,
first part of the definition contains the nature of activity; second
part contains the subject matter in relation to which the activity
is carried out and third part excludes those building or other
construction work to which the provisions of Factories Act or
Mines Act apply. [Para 24)(754-D-F]
1.6 The construction of the projects of the appellants is
covered by the definition of"building or other construction work"
as it satisfies first two ~lements of the definition. In order to see
whether exclusion clause applies, the words 'but does not include
any building or other construction work to which the provisions
of the Factories Act apply are to be interpreted. The provisions
of the Factories Act do not apply to the construction of building/
project of the appellants. The provisions of the Factories Act
would "apply" only when the manufacturing process starts for
which the building/project is being constructed and not to the
activity of construction of the project. That is how the exclusion
clause is to be interpreted and that would be the plain meaning of
the said clause. [Para 25)(754-G-H; 755-A-B]
Orf{ano Chemical Industries v. Union of India 1980 (1)
SCR 61 : (1979) 4 SCC 573 - referred to.
1. 7 The said meaning attributed to the exclusion clause of
the definition is also in consonance with the objective and purpose
which is sought to be achieved by the enactment of BOCW Act
and Welfare Cess Act. If the construction of this provision as
suggested by the appellants is accepted, the construction workers
who are engaged in the construction of buildings/projects would
neither get the benefit of the Factories Act nor of BOCW Act/
Welfare Cess Act. That could not have been the intention of the
Legislature. BOCW Act and Welfare Cess Act are pieces of social
security legislation to provide for certain benefits to the
construction workers. [Para 26] [755-F-H]
1.8 Purposive interpretation in a social amelioration
legislation is an imperative, irrespective of anything else.
'Superior purpose' contained in BOCW Act and Welfare Cess
Act has to be kept in mind when two enactments - the Factories
Act on the one hand and BOCW Act/Welfare Cess Act on the
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other hand, are involved, both of which are welfare legislations.
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[Paras 27, 32)(756-A-B)
Allahabad Bank v. Canara Bank 2000 (2) SCR 1102 :
(2000) 4 sec 406 - relied on.
Atma Ram Mittal v. Ishwar Singh Punia 1988 (2) Suppl.
SCR 528 : (1988) 4 SCC 284; MP. Mineral Industry
Association v. Regional Labour Commr. (Central) AIR
1960 SC 1068 : 1960 SCR 476; Surendra Kumar Verma
v. The Central Government Industrial Tribunal 1981 (1)
SCR 789 : (1980) 4 SCC 443; Workmen of American
Express v. ManaKement <?(American Express (1985) 4
SCC 71; Carew and Co. Ltd. v. Union of India 1976
(1) SCR 379 : (1975) 2 SCC 791; Bombay Anand
Bhavan Restaurant v. Deputy Director. Employees' State
Insurance Corporation & Anr. (2009) 9 SCC 61;
Pegasus Assets Reconstruction P. Ltd. v. Mis. Haryana
Concast Limited & Anr 2016 (1) SCALE 1; Richa
Mishra v. State of Chhattisgarh and Others 2016 (1)
SCR 316 : (2016) 4 SCC 179; Shailesh Dhairyawan v.
Mohan Balkrishna Lu/la 2015 SCR 70 : (2016) 3 SCC
619 - referred to.
1.9 The submission that while granting permission under
the Factories Act, various conditions are imposed which the
appellants are required to fulfill and these conditions are almost
the same which are contained in BOCW Act, cannot be accepted.
Registration under the Factories Act becomes necessary in view
of provisions contained in Section 6 of the said Act as this Section
requires taking of approval and registration of factories even at
preparatory stage i.e. at the stage when the premises where
factory is to operate has to ensure that construction will be done
in such a manner that it takes care of safety measures etc. which
arc provided in the Factories Act. This means to ensure that
construction is carried out in such a manner that provisions in
the Factories Act to ensure health, safety and provisions relating
to hazardous process as well as welfare measures are taken care
of. It is for this reason that even after the building is completed
before it is occupied, notice under Section 7 is to be given by the
occupier to the Chief Inspector of Factories so that a necessary
LANCO ANPARA POWER LIMITED v. STATE OF UTTAR
PRADESH
inspection is carried out to verify that all such measures are in
place. Therefore, when the permissions for construction of
factories is given, the purpose is altogether different. [Para
33)(759-C-F)
1.10 It is made clear that insofar as objection to the
calculation of cess as contained in the show cause notices is
concerned, it would be open to the appellants to agitate the same
before the adjudicating authorities. [Para 35][760-A-B)
Punjab Land Development and Reclamation
Corporation Ltd., Chandigarh v. Presiding Officer,
Labour Court, Chandigarh and Others 1990 (3) SCR
111 : (1990) 3 SCC 682; B.N. Mutto v. T.K. Nandi 1979
(2) SCR 409 : (1979) 1 SCC 361; Shri Hariprasad
Shivshanker Shukla and another v. Shri A.D. Divelkar
and others 1957 SCR 121; Regional Director, Employees
State Insurance Corporation, Trichur v. Ramanuja
Match Industries 1985 (2) SCR 119 : (1985) 1 SCC
218; Dadi Jagannadham v. Jammulu Ramulu and
Others 2001 (2) Suppl. SCR 60 : (2001) 7 SCC 71;
Shyam Sunder and others v. Ram Kumar and another
2001 (1) Suppl. SCR 115 : (2001) 8 SCC 24; Grasim
Industries Ltd. v. Collector of Customs, Bombay 2002
(2) SCR 945 : (2002) 4 SCC 297; Deepal Girishbhai
Soni and Others v. United India Insurance Co. Ltd.,
Baroda 2004 SCR 213 : (2004) 5 SCC 385; Bhikusa
Yamasa Kshatriya (P) Ltd. v. Union of India and another
1964 SCR (1) 860; Dewan Chand Builders and
Contractors v. Union of India and Others 2011 (13)
SCR 214 : (2012) 1 SCC 101- referred to.
Case Law Reference
1990 (3) SCR 111
referred to
Para 10
1979 (2) SCR 409
referred to·
Para 10
1957 SCR 121
referred to
Para 10
1985 (2) SCR 119
referred to
Para 10
2001 (2) Suppl. SCR 60
referred to
Para 10
2001 (1) Suppl. SCR 115
referred to
Para 10
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2902 (2) SCR 945
referred to
Para 10
2004 SCR 213
referred to
Para 10
1964 _S(:R (1) 860
referred to
Para 13
2011 (13) SCR 214
referred to
Para 16
B
1980 (1) SCR 61
referred to
Para25
1988 (2) Suppl. SCR 528
referred to
Para27
1960 SCR 476
referred to
Para28
1981 (1) SCR 789
referred to
Para 28
c
(1985) 4 sec 11
referred to
Para 29
1976 (1) SCR 379
referred to
Para30
(2009) 9 sec 61
referred to
Para 31
2000 (2) SCR 1102
relied on
Para32
D
2016 (1) SCALE 1
referred to
Para32
2016 (1) SCR 316
referred to
Para32
2015 SCR 70
referred to
Para32
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CIVIL APPELLATE JURISDICTION : Civil Appeal No. 6223
of2016
WITH
Civil Appeal Nos. 10187-10188of2016
W.P. (C) No. 64 of2012
F
W.P. (C) No. 848 of2013
W.P. (C) No. 385 of2014
Civil Appeal No. 6569of2014
G
T.P. (C) No. 342 of2014
T.C. (C) No. 29 of2015
W.P. (C) No. 174 of2016
W.P. (C) No. 311 of2016
H
Civil Appeal No. 6571 of2014
LANCO ANPARA POWER LIMITED v. STATE OF UTTAR
737
PRADESH
T.C. (C) No. 38 of2016
CivilAppealNo.10186of2016
W.P. (C) No. 698 of2016
CivilAppealNo.10189of2016.
From the Judgment and Order dated 28.04.2015 of the High Court
of Judicature at Allahabad in Writ Tax No. 772of2011.
Ms. Pinki Anand, ASG, C. A. Sundaram, Gaurab Banerji, Ravindra
Srivastava, Rana Mukherj i, Ms. Vibha Datta Makhija, Sr. Advs., Akhil
Sibal, Deepak Khurana, Ms. Aditi Sharma, Umesh Kumar Khaitan, Amar
Dave, Mahesh Agarwal, Ankur Saigal, Ms. Sadapurna Mukherjee,
Satyendra Kumar, E. C. Agrawala, Vikrant Panchnanada, Mahesh
Agarwal, Ms. Neha Nagpal, Shashank Mani sh, Ms. Vaidehi Misra, Sahil
Tagotra, 8. S. Banthia, Prashant Shukla,Alok Hoonka, Nitin Gupta, Kush
Agrawal, Nikilesh Ramachandran, Neeraj Shekhar, Arunabh Chowdhury,
Rahul Pratap, Parshanto Chandra Sen, Shivanshu Singh, Udayan Verma,
Ms. Sana Batta, A. Venayagam Balan, T. G Narayanan Nair, K. Raghava
Charyulu, Kai lash Pandey, Vaibhav Shukla, Ranjeet Singh, Ms. J. Kataria,
K. V. Sreekumar, Ravi Prakash Mehrotra, Rajeev Dubey, Pulkit Tare,
Sh_reekant N. Terdal, Shibashish Misra, Alok K. Agarwal, Sanjeev Kr.
Singh, Kumar Dushyant Singh, Puneet Taneja, Mishra Saurabh, Ankit
Kr. Lal, Ms. Atka Agarwal, R.R. Rajesh, A. K. Sharma, Franklin Caesar
Thomas, Chand Qureshi, M. P. Siddiqui, Upendra Prasad, Naveen
Chawla, T. Mahipal, T. A. Khan, Rajesh Ranjan, Mukhesh Kumar
Maroria, Advs. for the appearing parties.
The Judgment of the Court was delivered by
A.K. SIKRI, J. I. Leave granted in SLP (C) Nos. 29105-29106
of201 l, SLP (C) No. 26363 of2016 and SLP (C) No. 26330 of2016.
Since pure question oflaw is involved, we allow the transfer petition and
transfer cases and also take up, along with these appeals, the writ petitions
which were filed before the respective High Courts.
2. These appeals are filed by the appellants challenging the orders
passed by different High Courts i.e. High Court of Allahabad, High Court
ofOrissa, High Court of Madhya Pradesh and High Court ofKarnataka.
These High Courts, however, are unanimous in their approach and have
reached the same conclusion. In all these cases, appellants were issued
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show cause notices by the concerned authorities under the provisions of
the Building And Other Construction Workers (Regulation of Employment
and Conditions of Service) Act, 1996 (hereinafter referred to as 'BOCW
Act') and Buildings And Other Construction Workers Welfare Cess Act,
1996 (hereinafter referred to as 'Welfare Cess Act'). They had
challenged those notices by filing writ petitions in the High Courts on the
ground that the provisions of BOCW Act or Welfare Cess Act were not
applicable to them because of the reason that they were registered under
the Factories Act, 1948. It may be mentioned that at the relevant time
no manufacturing operation had commenced by the appellants. In fact,
all these appellants were in the process of construction of civil works/
factory buildings etc. wherein they had planned to set up their factories.
As the process of construction of civil works was undertaken by the
appellants wherein construction workers were engaged, the respondent
authorities took the view that the provisions of the aforesaid Acts which
were meant for construction workers became applicable and the
D.
appellants were supposed to pay the cess for the welfare of the said
workers engaged in the construction work. The appellants had submitted
that Section 2(d) of the BOCW Act which defines 'building or other
construction work' specifically states that it does not include any building
or construction work to which the provision of the Factories Act, 1948
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or the Mines Act, 1952 apply. Since the appellants stood registered
under the Factories Act, they were not covered by the definition ofbuilding
or other construction work as contained in Section 2( d) of the Act and,
therefore, said Act was not applicable to them by virtue of Section 1(4)
thereof. All the High Courts have negated the aforesaid plea of the
appellants on the ground that the appellants would not be covered by the
definition of factory defined under Section 2(m) of the Factories Act in
the absence of any operations/ manufacturing process and, therefore,
mere obtaining a licence under Section 6 of the Factories Act would not
suffice and rescue them from the'!r liability to pay cess under the Welfare
Cess Act. This is, in nutshell, the subject matter of all these appeals.
However, in order to understand the full implication of the issue involved
and to answer the said issue, it would be apt to take note of certain facts
from one of these appeals. This factual canvass is suitably available in
the events that have occurred leading to the filing of Civil Appeal No.
6223/2016.
3. In this appeal, the appellant proposed to set up a 2X600
LANCO ANPARA POWER LIMITED v. STATE OF UTTAR
PRADESH [A. K. SIKRI, J.]
Megawatt capacity coal-based thermal power project namely "Anpara
C" at Anpara in District Sonebhadra, Uttar Pradesh ("the Project"),
pursuant to being selected in a tariff-based competitive bidding initiated
by the Uttar Pradesh Rajya Vidyut Utpadan Nigam Ltd. (UPRVUNL)
on behalf of the Uttar Pradesh Power Corporation Ltd. (UPPCL). The
project consists of two Steam Turbine Generators (STG) each having
capacity of 600 MW and two pulverised coal fired steam generators
and the balance of plant. The appellant, in respect of the aforesaid
project, made an application to the Director of Factories, Uttar Pradesh,
submitting the layout/drawings of the proposed plants and requesting for
registration of the project as a factory under the provisions of the Factories
Act, 1948 and the Uttar Pradesh Factories Rules, 1950. The appellant
was granted registration and licence under Section 6 of the Factories
Act, 1948 read with Uttar Pradesh Factories Rules, 1950 for the said
Project, as a factory. Respondent -ND. I notified the 1,Jttar Pradesh
Building and other Construction Workers (R!!gulation of Employment
and Conditions of Service) Rules, 2009 (for short 'BOCW Rules') on
04.02.2009. Immediately thereafter, the appellant received a notice of
even date issued by respondent No. 2, intimating that the Chief Secretary,
Government ofUttar Pradesh had directed that "establishments" engaged
in construction activities were required to get themselves registered under
the provisions of the BOCW Act and the BOCW Rules. Simultaneously,
a letter of even date was also received from the District Collector,
Sonebhadra, Uttar Pradesh, calling upon the appellant to get itself/its
contractors registered under the provisions of the BOCW Act and the
BOCW Rules. The appellant, vide its letter of even date, replied to the
aforesaid communication dated 19.04.20 I 0 of the District Collector,
Sonebhadra, stating that the appellant was undertaking the construction
activity of the Project under the provisions of the Factories Act and as
such, in view of Section 2( I )(d) of the BOCW Act, the Project was
exempted from the application of the BOCW Act, and consequently the
Welfare Cess Act and BOCW Rules inasmuch as the provisions of the
Factories Act apply to the Project.
4. The respondents were not satisfied with the aforesaid stand
taken by the appellant. Thus, show cause notice dated 17.02.2011 was
issued by respondent No. 2 as to why action be not taken against the
appellant for failing to get itself registered under BOCW Act. It was
followed by another notice of even dale stating that the appellant had
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A · not furnished requisite information relating to construction activities
undertaken by it as required under Section 4 of the Welfare Cess Act
read with Rule 6 of the Welfare Cess Rules. Some more notices were
issued to the similar effect with regard to the construction activities in
respect of the township in Anpara, undertaken by the appellant. Insofar
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as township is concerned, appellant got itself registered through its
principal contractors under Welfare Cess Act and started paying the
cess. However, in respect of constn1ction activity and factory premises,
the appellant reiterated its stand that by virtue of Section 2( I)( d) of the
BOCW Act, it was excluded from the coverage thereof. The contention
of the appellant was rejected by the respondents which led to issuance
offurther notices demanding cess.
5. At this juncture, the appellant filed the writ petition in the High
Court of Judicature at Allahabad challenging tile validity of notices dated
14.03.2011and02.04.2011 demanding payment of cess, on the following
grounds:
(i) That the appellant is not amenable to assessment of liability
under the Welfare Cess Act inasmuch as the Factories Act is
applicable to the Project, and the Project is as such, exempt from
the applicability of the said Act by virtue of the exclusionary cause
contained in Section 2(1 )( d) of the BOCW Act.
(ii) That respondent No. 2, vide impugned notice dated 02.04.2011,
was proceeding to calculate the alleged cess payable by the
appellant on the basis of the cost of the Project, and not on the
cost of construction of the said Project, whereas under the scheme
of the Cess Act, cess is payable only o'i1 the cost of construction
' . incurred annually, and not on the entire project cost, which includes
several other components apart from civil construction works.
6. The respondents filed their counter affidavit contesting the
petition. After hearing, the writ petition has been dismissed by the High
Court vide judgment dated 28.04.2015, gist whereof has already been
G . . taken note of above.
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7. Emphatic submissions were made by Mr. Sundaram, learned
senior counsel appearin'g in some of these ·appeals, questioning the
·approach and conclusion reached by the High Court. Other senior counsel
Mr: Gaurab Banerji and Mr. Akhil Sibal supplemented those submissions
lending their candour thereto. These submissions were further
('
LANCO ANPARA POWER LIMITED v. STATE OF UTTAR
PRADESH [A. K. SIKRI, J.]
supplemented by Mis. Prashant Shukla, Arunabh Chowdhury and K.
Raghava Charyulu, Advocates. It may not be necessary to take note of
individual submissions made by these counsel. Instead, for the sake of
brevity, we are reproducing the submissions of these counsel in
consolidated form hereinafter.
8. These counsel have led two prong attacks on the demands
raised by the respondents for payment of cess under BOCW Act read
with Welfare Cess Act, which is as under:
i) In the first instance, it is argued that BOCW Act does not apply
to those undertakings which are registered under the Factories
Act. To support this submission, emphasis was laid on the definition
of "building or other construction work" as contained in Section
2(1 )( d) of BOCW Act, which reads as under:
"Section 2(1)(d) : "building or other construction work"
means the construction, 'alternation, repairs, maintenance
or demolition ofor, in relation to, buildings, streets, roads,
railways, tramways, airfields, irrigation, drainage,
embankment and navigation works, flood control works
(including storm water drainage works), generation,
transmission and distribution of power, water works
(including channels for distribution of water), oil and gas
installations, electric lines, wireless, radio, television,
telephone, telegraph and overseas communication dams,
canals, reservoirs, watercourses, tunnels, bridges, viaducts,
aquaducts, pipelines, towers, cooling towers, transmission
towers and such other work as may be specified in this
behalf by the appropriate Government, by notification but
does not include any building or other construction work to
which the provisions of the Factories Act, 1948 (63of1948).
or the Mines Act, 1952 (35 of 1952), apply.
(emphasis added)"
(ii)· Second submission, which in fact flows from first submission
noted above, was that the approach of the High Court in dealing with the
matter was contrary to law. In this behalf, it was pointed out that the
High Court has rejected the case of the appellants herein on the ground
that even if the appellants had obtained a licence under the Factories
Act for registration to work a factory, the appellants were still not excluded
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from the provisions of Welfare Cess Act as no manufacturing process
or factory operation had started by the appellants and, therefore,
appellants did not answer the description of'factol)'' within the meaning
of Factories Act. As per the High Court, since the appellants had only
undertaken the process of construction of premises which are to be
ultimately used as factories, and since such power project has not started
and there was no operation for which the licence was obtained under
the Factories Act till the production commences, it could not be said that
"factory" has come into existence and, therefore, the appellants were
not entitled to take advantage of mere registration under the Factories
Act.
Dubbing the aforesaid approach as erroneous, it was the argument
.· of the appellants that the High Court ignored the pertinent aspect that
even when the building was under construction, the establishments which
were covered by the Factories Act stood excluded by virtue of definition
contained in Section 2( d) of BOCW Act which pertained to construction
of building and, therefore, specifically covered the stage of construction
itself. It was argued that matter should have been seen from that angle.
Advancing this argument further, it was also submitted that the Legislature
is alive to the fact that the facto!)' is not running at the stage when
building or other construction work is going on. However, it still chose to
exclude those buildings or other construction work to which the provisions
of Factories Act apply.
9. Expanding the aforesaid submissions, the appellants even gave
the rationale in couching the definition of Section 2(d) of the BOCW Act
in that specific manner by submitting that once the provisions of Factories
Act apply, all the benefits which are admissible to the workers under the
BOCW Act and Welfare Cess Act are granted under the Factories Act
as well. This submission was buttressed by pointing out the provisions/
conditions stipulated while granting the permission under the Factories
Act. It was submitted that the safety measures and facilities which the
appellants were obligated under those conditions were the same as
stipulated in BOCW Act.
I 0. Taking support ofinterpretative tools to support the aforesaid
twin submissions, it was submitted by the counsel for the appellants that
Section 2(d} had to be given literal meaning, in the absence of any
ambiguity in the said provision and number of judgments were cited in
this behalf, Some_ of those judgments are as under:
LANCO ANPARA POWER LIMITED v. STATE OF UTTAR
PRADESH [A. K. SIKRI, J.)
i) In Punjab Lmrd Development mu/ ReclanratiOn Corporation
Ltd., Clwmligar/1 v. Presiding Officer, Labour Court,
. Chandigarh and Ot/1ers1, this Court while interpreting the word
'means' observed thatifthe definition has used the word 'means',·
it shall include certain things or acts and the definition has used .
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the word 'means', it shall include certain things or acts and the 'B
definition is a hard-a_nd-fast definition and no other meaning can·
be assigned to the expression than is put down in definition. This
Court further observed that if the· words of the statute are in .
themselves precise and unambiguous, then no· inore can be
necessary .than to expound those words in their natural and ordinary
sense. The words themselves alone do; in such case, best declare
C
the intention of the law. This Court after making reference to its
judgment in B.N. Mutto v. T.K. NamiP observed that "the Court
has to determine the intention as expressed by the words used. If
the words of a statute are themselves precise and unambiguous,
then no more can be necessary than to expound those words in
their ordinary a1id natural sense''. It was further observed that · D
"the cardinal rule of construction of statute is to read statutes
literally, that is, by giving t-0 the words their .ordinary, naturafand
grammatical meaning."
·
ii) In S/1ri Hariprasad Shivs/ranker Shukla andanot/1er v. Sltri
.A.D. Divelkar and otliers3, it was held that ''there is no doubt
that when the Act itself provides a dictionary for the words used, ·
we must look irito that dictionary first for an interpretation of the
words used' in the statute. We ~re not concerned with, any
.. presumed intention of the legislature; our task is to get at the
intention as expressed in the statute". .
.
iii) In Regional Director, Enrployeef State Insurance
Corporation, Tric/1ur v. Rmna11uja Matcil /11dustries\ the Court
pointed out that "there is no doubt that beneficial legislations should
have liberal construction with a view to implementing the legislative
intent but where such beneficial legislation has a scheme of its
.·own there is no warrant for the Court to travel beyond the scheme
and extend the scope of the statute on the pretext of extending
1 (1990) 3 sec 682 .
'll979) 1 sec 361
3 1957 SCR 121
• (1985) 1 sec 218
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the statutory benefit to those who are not covered by the scheme".
iv) In Dadi Jaganntullmm v. Jammu/u Ramulu and Otlters5,
this Court, while interpreting the provisions that fell for
consideration, made the following observations in paragraph 13:
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"13 ..... The settled principles of interpretation are that the
court must proceed on the assumption that the legislature
did not make a mistake and that it did what it intended to
do. The court must, as far as possible, adopt a construction
which will carry out the obvious intention of the legislature.
Undoubtedly ifthere is a defect or an omission in the words
used by the legislature, the court would not go to its aid to
correct or make up the deficiency. The court could not add
words to a statute or read words into it which are not there,
especially when the literal reading produces an intelligible
result. The court cannot aid the legislature's defective
phrasing of an Act, or add and mend, and, by construction,
make up deficiencies which are there."
v) In S/1yam Sunder and otlters v. Ram Kumar and anot/1e~,
this Court explained as to how to interpret the provisions of an
enactment in the following words:
E
" ... when the words used in a statute are capable of only
one meaning. In such a situation, the courts have been
hesitant to apply the rule of benevolent construction. But if
it is found that the words used in the statute give rise to
more than one meaning, in such circumstances, the courts
are not precluded from applying such rule of construction.
F
The third situation is when there is no ambiguity in a provision
of a statute so construed. If the provision of a statute is
plain, unambiguous and does not give rise to any doubt, in
such circumstances the rule of benevolent construction has
no application."
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vi) Similarly in Grasim Industries Ltd. v. Collector of Customs,
Bombay', the Constitution Bench of this Court explained the
principle ofliteral interpretation as under:
'(2001) 1sec11
'<2001) s sec 24
1 (2002) 4 sec 297
LANCO ANPARA POWER LIMITED v. STATE OF UTTAR
PRADESH [A. K. SIKRI, J.]
''10. No words or expressions used in any statute can be
said to be redundant or superfluous. In matters of
interpretation one should not concentrate too much on one
word and.pay too little attention to other words. No provision
in the statute and no word in any section can be construed
in isolation. Every provision and every word must be looked
at generally and in the context in which it is usecl. It is said
that every statute is an edict of the legislature. The
elementary principle of interpreting any word while
considering a statute _is to gather the mens or sententia legis
of the legislature. Where the words are clear and there is
no obscurity, and there is no ambiguity and the intention of
the legislature is clearly conveyed, there is no scope for the
court to take upon itself the task of amending or alternating
(sic altering) the statutory provisions. Wherever the language
is clear the intention of the legislature is to be gathered
from the language used. While doing so, what has been
said.in the statute as also what has not been said has to be
noted. The construction which requires for its support
addition or substitution of words or which resultsiin rejection
of words has to be avoided. As stated by the Privy Council
in Crmiford v. Spooner [(1846) 6 Moore PC 1 : 4 MIA
179] "we cannot aid the legislature's defective phrasing of
an Act, we cannot add or mend and, by construction make
up deficiencies which are left there". In case of an ordinary
word there should be no attempt to substitute or paraphrase
of general application. Attention should be confined to what
is necessary for deciding the particular case. This principle
is too well settled and reference to a few decisions of this
Court would suffice. (See: Gwalior Rayons Silk M&.
(Wvg.) Co. Ltd. v. Custodian of Vested Forests [1990
Supp SCC 785 : AIR 1990 SC 1747], Union of India v.
Deoki Nandan Aggarwal [1992 Supp (I) SCC 323: 1992
sec (L&S) 248 : {1992) 19 ATC 219 : AIR 1992 SC 96]
,Institute of Chartered Accountants of India v, Price;.,·
Waterhouse [(1997) 6 SCC 312] and Harbhajan Singh v.
Pre,_ss Council of India [(2002) 3 SCC 722 : JT (2002) 3
SC 21])''
.
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vii) In Deepal Girisltblwi Soni and Otlters v. United India
Insurance Co. Ltd., Baroda8, while interpreting the provisions
that fell for consideration, the principle was applied even in the
context of beneficial legislation, when the language was plain,
depicting clear intention of the legislature, in the following terms:
"53. Although the Act is a beneficial one and, thus, deserves
liberal construction with a view to implementing the
legislative intent but it is trite that where such beneficial
legislation has a scheme of its own and there is no vagueness
or doubt therein, the court would not travel beyond the same
and extend the scope of the statute on the pretext of
extending the statutory benefit to those who are not covered
thereby. (See Regional Director, ES/ Corpn. v. Ramanuja
Match Industries [( 1985) I SCC 218 : 1985 SCC (L&S)
213 : AIR 1985 SC 278])."
Relying upon all the aforesaid judgments, the forceful exhortation
was to follow this literal construction while interpteting Section 2(d) of
BOCW Act in the manner appellants suggested to us.
11. Mr. Rana and Mr. Srivastava countered the aforesaid
submissions giving equally salubrious response. Their fervent plea was
that the view taken by the High Court while interpreting the provisions
of Section 2(d) of BOCW Act was perfectly justified and any other
interpretation as suggested by the appellants would defeat the very
purpose of these Acts. It was argued that mere registration under the
Factories Act would be of no consequence inasmuch as definition of
'factory' contained in Section 2(m) of the Act unambiguously suggest
that the· provisions of the said Act would apply only when manufacturing
process is actually carried on. It was further submitted thatthe definition
of 'worker' under the Factories Act does not include construction
workers and, therefore, construction workers would not be entitled to·
various benefits whiCh are contained in different provisions of the
Factories Act. It is for this reason at the stage of construction of the
building, which is to be ultimately used as a factory, the provisions of
BOCW Act would be applied. It was also emphasised that while
interpreting the provisions of these two Acts, "superior purpose" behind
therein had to be kept in mind and this enactment which is for the welfare
' <2004) s sec 385
LANCO ANPARA POWER LIMITED v. STATE OF UTTAR
PRADESH [A. K. SIKRI, J.]
of the weaker section, i.e. workers of unorganised sector, had to be
liberally construed by giving that construction which accords them the
benefit eschewing the other approach which would preclude them from
getting the benefit under the Acts. In this hue, the learned counsel strongly
urged upon this Court to invoke the principle of purposive interpretation,
which is in vogue, to do complete justice in the matter. It was also
argued that exclusion provision contained in Section 2(d) ofBOCW Act
had to be construed narrowly as per the settled proposition of law.
12. We have bestowed our due and serious consideration to the
submissions made of both sides, which these submissions deserve. The
central issue is the meaning that is to be assigned to the language of
Section 2(d) of the Act, particularly that part which is exclusionary in
nature, i.e. which excludes such building and construction work to which
the provisions of Factories Act apply. Before coming to the grip of this
central issue, we deem it appropriate to refer to the objectives with
which the Factories Act and BOCW Act were enacted, as that would
be the guiding path to answer the core issue delineated above.
13. Insofar as Factories Act is concerned, its Preamble mentions
that it is an Act to consolidate and amend the law regulating labour in
factories. It is enacted primarily with the object of protecting workers
employed in factories against industrial and occupational hazards. For
that purpose it seeks to impose upon the owners or occupiers certain
oblig'ltions to protect workers unwary as well as negligent and to secure
for them employment in conditions conducive to their health and safety.
This Act also requires that the workers should work in healthy and sanitary
conditions and for that purpose it provides that precautions should be
taken forthe safety of workers and prevention of accidents. Incidental
provisions in Factories Act are made for securing information necessary
to ensure that the objects are carried out and the State Governments are
empowered to appoint Inspectors, to call for reports and to inspect the
prescribed registers with a view to maintain effective supervision. The
duty of the employer under this Act is to secure the health and safety of
workers and extends to providing adequate plant, machinery and
appliances, supervision over workers, healthy and safe premises, proper
system of working and extends to giving reasonable restrictions. Detailed
provisions are, therefore, made in diverse chapters of the Act imposing
oblig'ltions upon the owners of the factories to maintain inspe~ting staff
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and for maintenance of health, cleanliness, prevention of overcrowding
and provision for amenities such as lighting, drinking water, etc. Provisions
are also made for safety of workers and their welfare, such as restrictions
on working hours and on the employment of young persons and females,
and grant of annual leave with wages. In Bltikus" Yam"s" Ks/1(1/riy"
(P) Ltd. v. Union of India and m10tl1er9, this Court highlighted the
necessity and rationale behind legislating this Act and the objectives which
it sought to achieve, in the following manner:
"9. The Factories Act, as the preamble recites, is an Act to
consolidate and amend the law regulating labour in factories.
The Act is enacted primarily with the object of protecting
workers employed in factories against industrial and
occupational hazards. For that purpose it seeks to impose
upon the owners or the occupiers certain obligations to
protect workers unwary as well as negligent and to secure
forthem employment in conditions conducive to their health
and safety. The Act requires that the workers should work
in healthy and sanitary conditions and for that purpose it
provides that precautions should be taken for the safety of
workers and prevention ofaccidents. Incidental provisions
are made for securing information necessary to ensure that
the objects are carried out and the State Governments are
empowered to appoint Inspectors, to call for reports and to
inspect the prescribed registers with a view to maintain
effective supervision.