The Secretary vs. Indian Railways - Kerala High Court, 12 March 2021

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE SMT. JUSTICE P.V.ASHA FRIDAY, THE 12TH DAY OF MARCH 2021 / 21ST PHALGUNA, 1942 WP(C).No.22432 OF 2020(D) PETITIONER: THE SECRETARY A.K.G.MEMORIAL LABOUR CONTRACT SOCIETY LTD., P.B.NO.15, 145/16B, FORT ROAD, THALASSERY-670 001 BY ADVS. SRI.K.MOHANAKANNAN SMT.T.V.NEEMA RESPONDENTS: 1 INDIAN RAILWAYS REP.BY ITS CHAIRMAN, RAIL BHAVAN, RAISINA ROAD, NEW DELHI-110 001 2 THE SENIOR DIVISIONAL MANAGER (WORKS) ENGINEERING DEPARTMENT, SOUTHERN RAILWAY, THIRUVANANTHAPURAM DIVISION, THIRUVANANTHAPURAM-695 001 3 THE DIVISIONAL RAILWAY MANAGER (WORKS) SOUTHERN RAILWAY SRY DIVISIONAL OFFICE, THIRUVANANTHAPURAM-695 001 R1-3 BY SRI.S.PRASHANTH, SC, RAILWAYS THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 12.03.2021, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

WP(C).No.22432 OF 2020(D) 2 JUDGMENT Dated this the 12th day of March 2021 The writ petition is filed seeking the following reliefs: (i) To issue a Writ of Mandamus or any other appropriate Writ, order or direction, directing Respondents to pay the arrears of wages and continue to pay the same till the expiry of contract, within a time frame to be fixed by this Hon'ble Court; (ii) To issue a Writ of Mandamus or any other appropriate Writ, order or direction directing 3rd respondent to take up Ext.P6 and to release the amounts due and payable in terms of Ext.P1 to P5 within a time frame to be fixed by this Hon'ble Court; (iii) To grant such other and further reliefs as are just, proper and necessary in the facts and circumstances of the case.

The petitioner claims that it is a labour contract Society which had entered in to five separate agreements with the respondents for providing manpower to the Indian Railways in various stations. Pursuant to the work awarded to it,

WP(C).No.22432 OF 2020(D) 3 Exts.P1, P2, P3, P4 and P5 agreements were executed with the Railways on 10.02.2020, 08.11.2019, 14.09.2019, 04.10.2019 and 20.12.2019 respectively. The petitioner claims that it supplied manpower in tune with the agreement executed. According to the petitioner, the 3rd respondent has to release the wages and other components payable to the employees supplied by it and despite

Ext.P5

representation

dated 25.09.2020, the wage components are not paid. 3.`When the writ petition came up for consideration on 03.11.2020, the learned Standing counsel for the 1st respondent had submitted that the petitioner has not furnished the no claim certificate, Shramic Kalyan details, GST details , bank details and PF details which are necessary for processing the claim of the petitioner in respect of the bills submitted by the

WP(C).No.22432 OF 2020(D) 4 petitioner. It was also submitted that one of the contracts with petitioner was under process of termination. As the learned counsel for the petitioner, thereupon submitted that all the details would be made available, the respondents were directed to take expeditious steps for releasing the admitted amount to the petitioner within a period of two weeks.

Thereafter, the learned Standing counsel filed a statement on 02.12.2020, stating that there is no provision in the agreement which makes the respondents liable to pay wages to the persons employed by the petitioner and it is for the petitioner to pay them. It was further stated that, pursuant to the interim order passed on 03.11.2020, Annexure R1(a) letter was issued to the petitioner asking him to submit necessary documents to enable processing of payments; but the petitioner

WP(C).No.22432 OF 2020(D) 5 has not bothered to submit the said documents even after issuing Annexure R1(a) letter and therefore, they were not in a position to prepare the statements of the quantum of work done under different agreements. It was also stated that once the statements are prepared, the same has to be counter signed by the authorised signatory of the petitioner and the petitioner will have to submit a 'No Claim Certificate' to the Railways, in case there is no dispute about the quantum of work. It is also stated that, in the event of any dispute, such dispute has to be agitated through arbitration in accordance with the applicable Rules. It was also stated that Annexures R1(b) and (c) notices were issued to the petitioner in respect of Ext.P2 agreement. The respondents also stated that the petitioner was not reachable either through telephone or other means.

WP(C).No.22432 OF 2020(D) 6 It is also stated that the non performance of the petitioner was causing loss to the Railways. In Annexure R1(a) letter, the petitioner was directed to furnish Shramik kalyan details, Bank account details, copy of PAN card, GST details, Labour statement(Number of employees, their PF details etc.) stating that the said documents would be necessary to prepare the statements of the quantum of work done under different agreements.

A counter affidavit was also filed by the 3rd respondent on 26.02.2021 with contentions more or less similar to the contents of the statement. It is further stated that as per clause 55(c)(i) and 32 of the General Conditions of Contract, 2018, a contractor is required to furnish necessary information regarding the labour engaged by him and that central and state taxes will be deducted at source. The 3rd

WP(C).No.22432 OF 2020(D) 7 respondent

stated

that Ext.P6 representation was not received by them and that the petitioner did not furnish the necessary documents.

The petitioner had filed a reply affidavit stating that he has already submitted all the documents called for. It was stated that the Shramic Kalyan details from wages report with signature of the concerned supervisor was not produced because Railway authorities have not yet assessed the GST minimum wages. According to him all other documents including the GST registration, PAN number etc., were furnished as per Exts.P7 and P8 letters. It is stated that, in Ext.P8 letter, the petitioner has stated that since it was having a turnover of only less than 50 lakhs, a declaration is sufficient and therefore he had filed a declaration along with No Claim Certificate. He also claimed

WP(C).No.22432 OF 2020(D) 8 that Shramik Kalyan details and minimum wage condition is not included in the tender condition. According to the petitioner, the Shramik Kalyan details is not necessary, since it is not part of tender conditions. It is also stated that even if the contract is terminated, the petitioner would be entitled to the payment towards the employees engaged.

On the other hand the learned Standing counsel for the Railways points out that they have already called for the documents which are required as per the conditions of contract and Shramik Kalyan details are required in accordance with clause 55(c). The learned counsel for the respondents also submits that there is no amount admitted and therefore no payment can be made in the absence of all the documents as called for by the respondents. It is further stated that the GST

WP(C).No.22432 OF 2020(D) 9 registration has not been updated in the case of petitioner and there is an investigation going on against the petitioner at the instance of the GST authorities. According to the learned Standing Counsel, the petitioner has to resort to arbitration proceedings as provided in the tender conditions.

It is seen that there is a dispute as to the sufficiency of the documents which are required and those furnished by the petitioner. Therefore, in case, the petitioner submits all the documents which are required for processing the payment, the respondents shall take steps for disbursement of the admitted amount. In case, the respondents raise any dispute with respect to any claim including the requirement

of the documents,

the petitioner would be free to resort to arbitration proceedings in terms of the

WP(C).No.22432 OF 2020(D) 10 tender conditions. At any rate, the respondents shall pass orders on the claim of the petitioner after affording an opportunity of hearing to the petitioner within a period of one month. As the respondents have a complaint that the petitioner is not reachable, the hearing is fixed on 25.03.2021 at 11 a.m. before the 3rd respondent. The writ petition is accordingly disposed of. P.V.ASHA JUDGE DM

WP(C).No.22432 OF 2020(D) 11 APPENDIX PETITIONER'S EXHIBITS: EXHIBIT P1OF THE RELEVANT PAGES OF THE AGREEMENT EXECUTED BY THE PETITIONER DATED 10.2.2020 IN RESPECT OF THRISSUR DIVISION. EXHIBIT P2 THE AGREEMENT IN RESPECT OF KOTTAYAM DIVISION DATED 8.11.2019 EXHIBIT P3 THE AGREEMENT IN RESPECT OF ERNAKULAM DIVISION DATED 14.09.2019 EXHIBIT P4 THE AGREEMENT IN RESPECT OF KANNYAKUMARI DIVISION DATED 4.10.2019 EXHIBIT P5 THE AGREEMENT IN RESPECT OF THIRUVANANTHAPURAM DIVISION DATED 20.12.2019 EXHIBIT P6OF REPRESENTATION DATED 25.9.2020 SUBMITTED BY THE PETITIONER BEFORE THE 3RD RESPONDENT. EXHIBIT P7OF THE LETTER DATED 13-11-2020 SUBMITTED BY THE PETITIONER BEFORE THE 3RD RESPONDENT. EXHIBIT P8OF THE LETTER DATED 18/01/2021 TO THE 3RD RESPONDENT BY THE PETITIONER. RESPONDENTS' EXHIBITS ANNEXURE-R1(a) AOF THE LETTER DATED 16.11.2020 OF THE SENIOR DIVISIONAL ENGINEER (NORTH) OF THE RAILWAYS TO THE PETITIONER. ANNEXURE-R1(b) AOF THE NOTICE DATED 14.09.2020 ADDRESSED BY THE DIVISIONAL ENGINEER/NORTH TO THE PETITIONER. ANNEXURE-R1(c) AOF THE NOTICE DATED 01.10.2020 ADDRESSED BY THE DIVISIONAL ENGINEER/NORTH TO THE PETITIONER.