Case Note & Summary
The dispute arose from appeals concerning wage payments to casual labourers employed by the Food Corporation of India (FCI) under a contract. The original contract was established in 2000, with the contractor quoting a rate of 471% above the schedule of rates for various items, including casual labour. The High Court had previously ruled that casual labourers were entitled to wages equivalent to Class IV employees, a decision upheld by the Supreme Court in 2010. Following this, the contractor claimed additional payments based on the 471% ASOR, which the FCI rejected. The contractor filed a writ petition, leading to a High Court order that directed the FCI to verify and pay the outstanding dues. The FCI appealed against this order, arguing that the High Court misinterpreted the contractual obligations and the Supreme Court's earlier judgment. The contractor contended that the High Court's decision was justified based on the terms of the agreement. The Supreme Court analyzed the contractual terms, particularly Clause 24, and determined that the contractor was not entitled to the 471% ASOR for casual labourers, as the wages should align with the rates specified in the 2010 judgment. The court partly allowed the FCI's appeal, affirming the wage rates established in the earlier ruling and quashing the direction for the Chairman to determine the contractor's profit from the contract. The contractor's appeal was dismissed, and no costs were awarded.
Headnote
A) Contract Law - Wage Determination - Entitlement to Wages - Civil Appeal Nos. 94729473 of 2003 - The court held that the contractor is not entitled to claim wages on 471% ASOR basis for casual labourers, as the wages must be determined according to the Supreme Court's judgment dated 14.01.2010. The court emphasized that the contractor's claim contradicted the contractual terms and the established wage rates (Paras 6-7).
Issue of Consideration
Whether the contractor is entitled to 471% ASOR for supply of casual labourers under the contract.
Final Decision
The Supreme Court partly allowed the FCI's appeal, affirming that wages must be paid according to the rates specified in the 2010 judgment and not on 471% ASOR basis. The direction for the Chairman to determine the contractor's profit was quashed.
Law Points
- Wage determination
- Contractual obligations
- Contempt of court
- Interpretation of contract clauses
