Remanded

M/S. Chicago Constructions International Private Limited v. Kerala Water Authority

Kerala HC19 Dec 2023WP(C)/42948/2023

Case brief

AI extract

What is this about?

The High Court set aside proceedings to deduct Cess from the applicant's bills under the Kerala Construction Workers Welfare Fund Act, directing the competent authority to hear the applicant and assess their liability before any deduction or recovery is made.

What did the court decide?

Impugned proceedings set aside; Authority directed to hear petitioner and assess liability before deducting Cess; previous recovery deferred; amounts collected to be returned if Cess not found applica

M/S. Chicago Constructions International… — Labour and Industrial Disputes | Kerala HC (2023)

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IN THE HIGH COURT OF KERALA AT ERNAKULAM

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PRESENT

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THE HONOURABLE MR. JUSTICE DEVAN RAMACHANDRAN

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TUESDAY, THE 19TH DAY OF DECEMBER 2023 / 28TH AGRAHAYANA, 1945

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WP(C) NO. 42948 OF 2023

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PETITIONER:

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M/S. CHICAGO CONSTRUCTIONS INTERNATIONAL PRIVATE LIMITED
REPRESENTED BY ITS MANAGING DIRECTOR, S.MOHANA KUMAR,
AGED 60 YEARS, SON OF SADASIVAN, HAVING ITS REGISTERED
OFFICE AT TC 22/2703, CHITIRA LANE, KOCHAR ROAD,
SASTHAMANGALAM, THIRUVANANTHAPURAM, PIN - 695010

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BY ADVS.
N.KRISHNA PRASAD
P.SHANES METHAR
DEEPAK VARUGHESE MATHEW
BHARATH MOHAN
A.MOHAMMED FAIZAL
GEETHU SUSAN VARGHESE
JAISHRI SHEBA JACOB
PUSHPARAJ.K.P

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RESPONDENTS:

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1 KERALA WATER AUTHORITY REPRESENTED BY ITS MANAGING DIRECTOR, JALA BHAVAN, OBSERVATORY HILLS, VELLAYAMBALAM, THIRUVANANTHAPURAM, PIN - 695033

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2 THE SUPERINTENDING ENGINEER KERALA WATER AUTHORITY, PUBLIC HEALTH CIRCLE, THIRUVANANTHAPURAM, PIN - 695033

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3 THE EXECUTIVE ENGINEER PROJECT DIVISION, KERALA WATER AUTHORITY, THIRUVANANTHAPURAM, PIN - 695033

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4THE KERALA CONSTRUCTION WORKERS WELFARE FUND BOARD
REP. BY ITS CHAIRMAN, NIRMAL BHAVAN, METTUKKADA, THAYCAUD
POST, THIRUVANANTHAPURAM, PIN - 695014

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THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON

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19.12.2023, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

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WP(C) NO. 42948 OF 2023

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JUDGMENT

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The petitioner in this matter – is stated to

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be Works Contractors, engaged by the Kerala
Water Authority (KWA).

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that they have been contracted with the ‘KWA’

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only to supply materials for pipeline works being
carried on by them; and that they have no
connection with such construction work, or its
allied performance. They argue that, obviously,

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therefore, no “Cess” under the Kerala
Construction Workers Welfare Fund Act, could have
been imposed against them, since the contracts
entered into by them have no relation to the
construction work at all, or to the construction
j

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WP(C) NO. 42948 OF 2023

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workers.

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3.The petitioner say that, however, in

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spite of this, 1% of their bill amount is sought
to be now deducted towards “Cess” under the
“KCWWF”; and consequently, that they have been
constrained to approach this Court, through this
writ petition. They assert that their contentions
are supported by the judgments of this Court in
Poulose and others v. State of Kerala and others
[1993(3)ILR Kerala 675] and Kerala Construction
WWF Board v. State of Kerala [1995(2) KLT 724].

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4.Sri.P.M.Johny – learned Standing Counsel
for the ‘KWA’, however, in response to the afore
submissions of Sri.P.Shanes Methar – learned
counsel for the petitioner, argued that, since
the petitioner is a contractor under the ‘KWA’,
their obligation to pay “Cess” under the “KCWWF”
is unmistakable and unavoidable. He argued that,

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WP(C) NO. 42948 OF 2023

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as long as the petitioner is involved in

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construction works, they certainly have to pay
“Cess” and they cannot refuse it in any manner
whatsoever.

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positions that there is factual disputation as to
the nature of the contracts entered into by the
petitioner with the ‘KWA’. While they maintain
that they are to only supply materials, without
having any participation in the actual
construction work; the ‘KWA’ appears to take the
stand that, even the supply of materials is part
of the construction work.

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6.However, it must be borne in mind that
“KCWWF” Scheme has a particular ambit to it and

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its purlieus are also well defined. It is only if

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all the criteria thereunder are satisfied, will

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the obligation of a contractor to pay “Cess”

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WP(C) NO. 42948 OF 2023

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thereunder be attracted.

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7.In the case at hand, as I have already

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said above, it is the specific contention of the
petitioner that they only supply materials and
have no part in the construction work. If this be

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so, certainly, it is a matter which the
Superintendent or such other competent Authority
of ‘KWA’ must consider, before imposing “Cess”
upon them, through an automatic deduction from
their bills.

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8.When there is a clear factual dispute as
afore, it would not be proper for one of the
contracting parties unilaterally to impose a
detriment on the other, citing that they are

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liable to pay “Cess”, without even making an
assessment of the same and without affording them
an opportunity of being heard.

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WP(C) NO. 42948 OF 2023

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writ petitions and set aside impugned proceedings
and direct the competent Authority of the ‘KWA’
to hear the petitioner and assess their claim,
that they are not liable to pay “Cess” under the
“KCWWF” Act because, they only supply materials
and not concerned with the construction work.
The afore shall be done, after affording each
of the petitioner an opportunity of being heard
and after assessing their contentions and the
germane documentary materials; thus culminating
in an appropriate order and necessary action
thereon, as expeditiously as is possible. This
shall be done also adverting specifically to the
declarations in the afore cited precedents.

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Needless to say, until such time as the afore
is done and the resultant orders communicated to
the petitioner, action to recover any amount from
their Bill amounts towards “Cess” under the

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WP(C) NO. 42948 OF 2023

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“KCWWF Act”, will stand deferred; and will be
taken forward only after the said orders are
communicated to them and in terms of the
decisions will be arrived at.

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As a corollary, if, through the afore
exercise, it is to be found that “Cess” under

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the “KCWWF Act” cannot be imposed against the
petitioner, then the amounts already collected
from them under such head will be returned

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without any avoidable delay.

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DEVAN RAMACHANDRAN

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JUDGE

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SAS

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WP(C) NO. 42948 OF 2023

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APPENDIX OF WP(C) 42948/2023

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PETITIONER’S EXHIBITS:

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Exhibit P1

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Exhibit P2
Exhibit P3
Exhibit P4
Exhibit P5
Exhibit P6
Exhibit P7

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Exhibit P8
Exhibit P9

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TRUE COPY OF THE WORK ORDER ALONG WITH THE
ACCEPTED PRICE SCHEDULE
TRUE COPY OF THE AGREEMENT DATED 27.07.2022
TRUE COPY OF THE PAYMENT BREAK UP SCHEDULE
TRUE COPY OF THE CB-3 VOUCHER DATED 16.11.2022
TRUE COPY OF THE CB-3 VOUCHER DATED 13.02.2023
TRUE COPY OF THE CB-3 VOUCHER DATED 18.03.2023
TRUE COPY OF THE CB- 3 VOUCHER DATED
04.05.2023

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TRUE COPY OF THE CB-3 VOUCHER DATED 19.07.2023
TRUE COPY OF THE JUDGMENT DATED 04.12.2023 IN
WRIT PETITION (CIVIL) NO.39649 OF 2023 AD
CONNECTED CASES

M/S. Chicago Constructions International Private Limited v. Kerala Water Authority

Case brief

What is this about?

What did the court decide?

M/S. Chicago Constructions International Private Limited v. Kerala Water Authority

Case brief

What is this about?

What did the court decide?

What the court decided

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M/S. Chicago Constructions International Private Limited Vs Kerala Water Authority