When and under what circumstances a principal employer is obligated to seek registration under the Act?
Principal employer means owner or occupier or the person who exercise ultimate control and supervision and manages the affairs of the establishment.
The Bombay High Court has held that when a company got a contract from an Electricity Board for work relating to erection of a new power station, the company could not be registered as principal employer under the Contract Labour (Regulation & Abolition) Act, 1970. In fact the Board was principal employer and the company was a contractor who might have engaged subcontractors.! In another case the Gujarat High Court has held that when firm 'A' was dealing in large transactions with many firms besides the firm 'B' for which they were doing stitching work in their own premises. The firm 'A' could not be treated as a contractor employing contract labour for doing the job of firm 'B' as principal employer under the Contract Labour (Regulation and Abolition) Act2
References:
another 1976 Lab. IC 745 (Bom.HC).
2. State of Gujarat vs. Vogue Garments and Ors., !985 LLJ (1) 255 (Gujarat HC).
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