JUDGMENT 1. The petitioners were contract labourers engaged in the process of handling and moving of raw materials in the factory premises of first respondent company at its Cochin Division. There were in all 46 labourers who were engaged through a contractor. These labourers were represented by two trade unions, namely (i) Materials and Products Loading and Unloading Workers Union, and (ii) Raw Materials Loading and Unloading Workers Congress, the first petitioner being the Secretary of the latter Union. The case of the petitioners can be stated thus: pursuant to the judgment of this court in W.A. No. 349/91, the problems of the contract labourers in the first respondent company were referred to the State Advisory Board by the Government. The Board after considering all aspects of the problem recommended to the Government to prohibit employment of contract labour in the F.A.C.T., Cochin Division. Thereupon the Government by notification dated 6th March 1992 prohibited employment of contract labour engaged in the process of handling and moving of raw materials of rock phosphate and sulphur inside the factory premises of the company. Ext. P-1 is a copy of the aforesaid notification. The first respondent company thereafter applied to the Government for adequate time for finalising the modalities for the implementation of Ext. P1. Ultimately, by Ext.P-2 dated. 17th October 1992 the Government, in exercise of power conferred by S.31 of the Contract Labour (Regulation and Abolition) Act, 1970 (hereinafter referred to as 'the Act') ordered that the provisions of the said Act regarding the abolition of the contract labour shall not apply to the Cochin Division of the F.A.C.T., till 31st December, 1992 in so far as the employment of contract labour engaged in the process of handling and moving of raw materials. The first respondent company was obliged to absorb and regularise the petitioners and other contract labourers immediately after 31st December, 1992. However, the second respondent held joint conference at his office on 24th November, 1992 and 6th January 1993. In this conference the first respondent company and the Secretaries of the Unions were participated. The first petitioner and others strongly demanded for immediate implementation of Ext. P-1 order and absorption of contract labourers into the regular service of the company. Notwithstanding this, the first respondent company had made a Memorandum of Settlement, evidenced by Ext. P3. Ext. P3 is being challenged in this writ petition. 2. The first petitioner and others strongly demanded for immediate implementation of Ext. P-1 order and absorption of contract labourers into the regular service of the company. Notwithstanding this, the first respondent company had made a Memorandum of Settlement, evidenced by Ext. P3. Ext. P3 is being challenged in this writ petition. 2. The case of the respondent company is this: The Government as per Ext. P-2 had granted time till 31st December 1992 for working out modalities for implementation of the Government order prohibiting employment of . contract labour. However, on the basis of the representation made by the Trade Unions a meeting was convened by the second respondent. After series of conferences a consensus was arrived at on 6th January 1993 among all parties regarding the absorption of some of the contract workers as a result of which eight workers were absorbed on 12th March 1992. The names of the remaining workers were included in the select list for appointment within two years from the date of publication of the select panel. It Was further agreed that persons who were not absorbed would be given an ex gratia payment equivalent to 45 days' wages for every, completed year of service. Ext. R-1(A) is a copy of the agreement arrived at by the parties present in the conference held on 6th January 1993. The first petitioner is one of the persons present throughout the conference held on 6th January 1993 and he represented at the conference on behalf of the workmen. Ext. P-3 agreement arrived at between the parties is valid and binding on all the persons concerned. 3. Two contentions are , raised by the petitioners. They are: (1) In view of the abolition of the contract labour pursuant to Ext. P-1 notification the labourers are liable to be absorbed automatically in the regular employment by the company, and (2) Ext. P-3 agreement is null and void, and therefore the labourers should be treated as workmen directly employed by the company. 4. S.10 of the Act prohibiting, contract labour is thus: 10. Prohibition of employment of contract labour...... (1) Notwithstanding anything contained in this Act, appropriate Government may, after consultation with the Central Board or as the case may be, a State Board, prohibit by notification in the Official Gazette, employment of contract labour in any process, operation or, other work in any establishment. Prohibition of employment of contract labour...... (1) Notwithstanding anything contained in this Act, appropriate Government may, after consultation with the Central Board or as the case may be, a State Board, prohibit by notification in the Official Gazette, employment of contract labour in any process, operation or, other work in any establishment. (3) Before issuing any notification under sub-s.(1) in relation to an establishment, the appropriate Government shall have regard to the conditions of work and benefits provided for the contract labour in that establishment and other relevant factors, such as- (a) whether the process, operation or other work is incidental to, or necessary for the industry, trade, business, manufacture or occupation that is carried on in the establishment; (b) whether it is of perennial nature, that is to say, it is of sufficient duration having regard to the nature of industry, trade, business, manufacture or occupation carried on in that establishment; (c) whether it is done ordinarily through regular workmen in that establishment or an establishment similar thereto; (d) whether it is sufficient to employ considerable number of whole time workmen. Explanation - If a, question arises whether any process or operation or other work is of perennial nature, the decision of the appropriate Government thereon shall be final. The power to prohibit employment of contract labour in any establishment is conferred on appropriate Government, that is to say, the Central Government or State Government. This shall be done after consultation with the Central Board or the State Board, as the case may be. The prohibition of such employment will take effect on the date of notification in the official gazette by the appropriate Government prohibiting contract labour in any establishment. Before issuing the notification the Government shall have regard to the conditions of work and benefits provided for the contract labour in the establishment and other relevant matters specified in clause (a) to (d) of sub-s.(2). As far as the present case is concerned, the Government have issued Ext. P-l notification on 12th March 1992 prohibiting contract labour and by Ext. P-2 dated 17th October 1992 the Government have further extended the time for implementing Ext. P-l upto 31st December 1992. In other words, the contract labour is totally prohibited in the factory wing of the first respondent company in respect of the handling and moving of raw materials with effect from 1st January 1993. P-2 dated 17th October 1992 the Government have further extended the time for implementing Ext. P-l upto 31st December 1992. In other words, the contract labour is totally prohibited in the factory wing of the first respondent company in respect of the handling and moving of raw materials with effect from 1st January 1993. Therefore the argument is that workmen who were engaged as contract labour till the date of Ext. P-1 are liable to be absorbed in regular employment. 5. The Supreme Court in Catering Cleavers of Southern Railway v. Union of India AIR 1987 SC 777 had occasion to consider a case where the petitioners therein pleaded to issue a writ of mandamus straightaway directing the Central Government to abolish contract labour system under which cleaners in catering establishments and pantry cars are employed in the Southern Railway. While analysing the facts of that case the Supreme Court found: "On the facts presented to us and on, the report of the Parliamentary Committee of petitions it appears to be clear that the work of cleaning catering establishments and pantry cars is necessary and incidental to the industry or business of the Southern Railway and so requirement (a) of S.10(2) is satisfied, that it is of a perennial nature and so requirement (b) is satisfied, that the work is done through regular workmen in most Railways in the country and so requirement (c) is satisfied and that the work requires the employment of sufficient number of whole time workmen and so requirement (d) is also satisfied. Thus all the relevant factors mentioned in S.10(2) appear to be satisfactorily accounted for. In addition we have the factor of profitability of the catering establishments." However, the Supreme Court in spite of the above finding that all the relevant factors mentioned in S.10(2) Were satisfied, refrained from directing the Central Government to abolish contract labour system because under S.10 Parliament has vested in the 'appropriate Government' the power to prohibit employment of contract labour in any process, operation or their work in any establishment. Therefore the Supreme Court directed the Central Government to take appropriate action under S.10 of the Act in the matter of prohibition of employment of contract labour within a period of six months. 6. Therefore the Supreme Court directed the Central Government to take appropriate action under S.10 of the Act in the matter of prohibition of employment of contract labour within a period of six months. 6. Reliance was heavily placed on the aforesaid decision by the appellants before the Division Bench of this court in P. Karunakaran v. Chief Commercial Superintendent, S Rly. 1989 (1) LLJ 8 in support of their contention as to the right of , the contract labourers for absorption in the service of the Southern Railway. However, that contention was repelled by the Division Bench observing thus: "The contractor himself has to vacate the premises and with him the entire establishment has to vacate on the expiry of the licence period to pave the way for the new contractor to run the refreshment room." It is further observed that the workmen were engaged by a private contractor and not by Southern Railway. ' Therefore, the workmen cannot claim any right to be absorbed by the Railway. According to the Division Bench, "such absorption will violate Art.14 and 16 of the Constitution in the matter of employment of persons in the Railway administration." 7. The above decision of the Division Bench of this court came to the notice of the Supreme Court in Dena Nath and others V. National Fertilisers Ltd. 1992 (1) LLJ. 289 . The view expressed by this court in the above case was approved by the Supreme Court. In the course of the judgment the Supreme Court observed: "From the above provisions it is clear that the Act serves two fold purposes (1) regulation of the conditions of service of the workers employed by the contractor who is engaged by a principal employer and; (2) also provides for the appropriate Government abolishing contract labour altogether, in certain notified processes, operation or other works in any establishment. Neither the Act nor the Rules framed by the Central Government or by any appropriate Government provide that upon abolition of. contract labour, the said labour would be directly absorbed by the principal employer." (Italics supplied) 8. It is therefore arduous for this court to accept the argument that there is automatic absorption of the labourers on issue of a notification by the Government under S.10 of the Act abolishing contract labour. contract labour, the said labour would be directly absorbed by the principal employer." (Italics supplied) 8. It is therefore arduous for this court to accept the argument that there is automatic absorption of the labourers on issue of a notification by the Government under S.10 of the Act abolishing contract labour. The Act is intended "to regulate employment of contract labour in certain establishments and to provide for its abolition in certain circumstances and for matters connected therewith" From this long title it is perspicuous that the Act is intended to regulate employment of contract labour and not to provide for its total annihilation. Abolition is also allowed in certain circumstances. The question whether contract labour should be abolished or not in a given situation is totally left to the decision of the Government after consultation wish Central Board or the State Board, as the case may be. Before taking a decision under sub-s.(2) of S.10, the Government must also satisfy other relevant factors as provided in clauses (a) to (d) thereof. Therefore, it is apodictic that there is no total abolition of the contract labour by reason of S.10 of the, Act. It is also explicit that there is no provision in the Act under which any person employed as a Contract labour can claim permanency of employment. In Kerala Civil Aviation General Workers Cooperative Society v. Union of India 1984 (2) LLJ 314 the labourers employed by the contractor claimed that they were entitled to be absorbed in the Civil Aviation Department. Balakrishna Menon, J. (as he then was) of this court, while deciding the above question, observed: "The Act does not provide for permanency of employment of contract labour. A succeeding contractor is not obliged to absorb the workers of a previous contractor into his service". 9. After having, found that there is no automatic absorption of the labourers in the regular employment consequent on the notification issued under S.10 of the Act, it would be necessary to examine the relationship that exists between the employee and employer thereafter. The question is whether the workmen will continue to be contract labourers as before in the establishment or cease to be so denying all chances of future employment. Here I can only favour the former question and not the latter. The question is whether the workmen will continue to be contract labourers as before in the establishment or cease to be so denying all chances of future employment. Here I can only favour the former question and not the latter. Reason is that the abolition of contract labour system does not mean total denial of employment to contract labour in an establishment. When a notification under S.10 is issued, it is the duty of the employer to find out whether all the contract labourers working in the establishment could be fully absorbed in regular employment or should be allowed to continue as contract labour as before. In the latter case, they should be absorbed in regular employment as and when vacancy arises. This is so for the reason that the Act is intended to provide not only abolition of contract labour in certain circumstances but also regulation of the employment of contract labour. It cannot be said that the workmen have no right to resort to proceedings under the provisions of the Industrial Disputes Act against the principal employer when there is total or partial denial of existing employment subsequent to the abolition of contract labour. 10. S.30 of the Act deals with effect of laws and agreements inconsistent with the provisions of the Act. It runs thus: "30, Effect of laws and agreements inconsistent with this Act. (1) The provisions of this Act shall have effect notwithstanding anything inconsistent therewith contained in any other law or in the terms of any agreement or contract of service, or in any standing orders applicable to the establishment whether made before or after the commencement of the Act: Provided that where under any such agreement, contract of service or standing orders the contract labour employed in the establishment are entitled to benefits in respect of any matter which are more favourable to them than those to which they would be entitled under this Act, the contract labour shall continue to be entitled to the more favourable benefits in respect of that matter, notwithstanding that they received benefits in respect of other matters under this Act. (2) Nothing contained in this Act shall be construed as precluding any such contract labour from entering into an agreement with the principal employer or the contractor, as the case may be, for granting them rights or privileges in respect of any matter which are more favourable to them than those to which they would be entitled under this Act." In view of the above provision, it was contended that Ext. P-3 agreement is invalid and therefore the labourers shall be treated as workmen directly employed by the company. It is difficult for this court to countenance this argument. There is no provision in the above section which indicates that any other law, terms of agreement, contract of service or any standing orders applicable to the establishment which is inconsistent with the provisions of this Act will be void. On the other hand it would reveal that the provisions contained in the Act shall have overriding effect over any other law, agreement, contract of service or standing orders which is inconsistent with any of its provisions. There is no provision in the Act which either expressly or by necessary implication invalidates such laws, terms of agreement, contract of service or standing orders. 11. Can it be said that the principal employer or contractor is not. under any obligation to give employment in future vacancies arising in the establishment inasmuch as Ext. P-3 agreement was found to be valid? It cannot be said so as there is no provision in the Act which denies such benefit to the workmen after the abolition of contract labour. Clause.10 of Ext. P-3 agreement falls thus: "10. The workers engaged by the Contractor as on the date of Government Order who are not considered for appointment by the Company are listed in Annexure C of this settlement and will be paid the amount mentioned against their names purely on an ex gratia basis as a special case in full and final settlement of all their claims after obtaining a 'stamped receipt in the pro forma as per Annexure D". This clause can only be interpreted as the one which came into being in view of the situation that existed at the time of the issue of Ext. P1 notification. This clause can only be interpreted as the one which came into being in view of the situation that existed at the time of the issue of Ext. P1 notification. As per the above clause the workers engaged by the contractor as on the date of Government order who are not considered for appointment by the company will be given ex gratia payments in full and final settlement of all their claims. Under the guise of this provision the company cannot appoint fresh hands in preference to the workmen whose names are included in Annexure G as and when the vacancies are found to be available irrespective of whether such workmen have accepted the ex gratia payment or not. The words 'in full and final settlement of all their claims' will not in the circumstances of the case weed out the workmen from advancing their claims at the relevant time. If the company makes fresh hands ignoring the claim of the petitioners as aforesaid, they can enforce it by invoking the provisions contained in the Industrial Disputes Act. 12. In view of my conclusions in the aforesaid paragraphs, the reliefs as framed in the present writ petition cannot be granted. I dismiss the writ petition subject to what I have said above.