JUDGMENT K.M. Joseph, J. 1. The appellant is the second opposite party in a proceeding under Section 22 of the Workmen's Compensation Act, 1923 (renamed as Employee's Compensation Act, 1923) (hereinafter referred to as 'the Act'). 2. The claimant laid the claim alleging that while he was working as a concrete worker in a construction company of a building and being employed by the appellant and the first opposite party, he suffered an injury and accordingly he claimed compensation. The Commissioner noticed various injuries, took note of medical evidence tendered through AW2 and Ext.A3 disability certificate and found that the claimant had suffered 35% loss of earning capacity and fixed the amount of compensation at Rs.1,21,649/-. Both the appellant and the first opposite party were jointly and severally liable that they deposit the aforesaid amount at 12% interest from the date of accident. In the course of the order, the Commissioner found that the appellant was a workman as defined under Section 2(1)(n) of the Act and there was an employee/employer relationship between the opposite parties. 3. Being aggrieved by the same, the appellant is before us. He purportedly raised the following questions of law :- "1. Whether the appellant can be made liable to compensate the claimant in the light of Exhibit A6 contract as per which the first opposite party/independent contractor is liable to compensate workers who suffers any injury during the course of employment. 2. Can the appellant/owner of the property be made liable to compensate a worker employed by the independent contractor engaged for construction of a building in the property. 3. Whether the construction of the building in the property of the appellant can be termed as his trade or business so as to make him liable to compensate the workman employed by the independent contractor. 4. Whether the court below went wrong in making the appellant liable to compensate the workman when he himself admitted that he was directly employed by the 1st respondent/contractor." On the said basis, the order is liable to be set aside. 4. We heard the learned counsel for the appellant and the learned counsel for the respondent. 5.
4. Whether the court below went wrong in making the appellant liable to compensate the workman when he himself admitted that he was directly employed by the 1st respondent/contractor." On the said basis, the order is liable to be set aside. 4. We heard the learned counsel for the appellant and the learned counsel for the respondent. 5. The learned counsel for the appellant would urge before us that there is no pleading to make the appellant liable and the Commissioner has found that the claimant was engaged as a worker by the first opposite party to the construction of the building. There is no plea as such that the appellant was the principal employer. He would contend that there is no case that the construction was in connection with any trade or business. This is a requirement under Section 12 of the Act. There is no dispute that the appellant who was abroad had actually engaged the first opposite party as a contractor for the construction of the building. Ext.A6 is the agreement. He would not further dispute that the building in question was a shopping complex. 6. It is the appellant's case that without any pleading to show that either the appellant is liable as principal employer, nor even to show that he was liable as immediate employer, the appellant will not be liable. 7. We have perused the agreement (Ext.A6). The appellant apparently engaged the first opposite party for the purpose of construction of the building. We take note of the evidence tendered by the claimant in his proof affidavit to the effect that he was engaged in the construction of the shopping complex. The consideration provided in Ext.A6 agreement is about Rs.51 Lakhs. The construction took place in the year 2001. No doubt, the learned counsel for the appellant would contend that when AW1 was cross examined he said that he has not seen the appellant. He point out that the case of the claimant was that he was employed by the opposite parties and therefore poses the question how the appellant could be made liable. 8. It is true that there is no plea as such in the claim of the applicant that the appellant was the principal employer.
He point out that the case of the claimant was that he was employed by the opposite parties and therefore poses the question how the appellant could be made liable. 8. It is true that there is no plea as such in the claim of the applicant that the appellant was the principal employer. It is equally true that there is no reference that it is in "connection with the trade and business of the appellant", that the construction was undertaken. It is also true that there is no finding as such entered by the Commissioner that the appellant became liable as the principal employer. It is true that the Commissioner had proceeded that there is employee/employer relationship between the claimant and the opposite parties and what is more, in the relief portion, as already noted, it is found that the appellant and the first opposite party are jointly and severally liable. But we would think that we cannot over look certain aspects. There can be no dispute that under Ext.A6 agreement, construction of shopping complex was undertaken in the premises in the possession of the appellant. 9. The further question to be considered in the context of Section 12 of the Act is the construction of the building which was for the purpose of using as a shopping complex was in the course of or for the purpose of the appellant's trade or business. The next question is whether he has contracted with the first opposite party for the execution by or under him and the whole or any work which is ordinarily part of the trade and business of the appellant. 10. Learned counsel for the appellant would point out that the appellant was approached. He was the owner of the land. It was not necessary for him to construct the building. He could have made use of the property in some other manner. Merely because he decided to construct a shopping complex, it could not be treated as his business. In other words, it is not ordinarily part of the trade or business of the appellant to put up the building. Learned counsel for the appellant would drew our attention to a large body of case law. They are: (i) Rabia Mahomed Tahir v. G.I.P. Railway, AIR 1929 Bombay 179. (ii) Bai Kokilabai v. Keshavlal Mangaldas & Co., AIR 1942 Bombay 18 (FB).
Learned counsel for the appellant would drew our attention to a large body of case law. They are: (i) Rabia Mahomed Tahir v. G.I.P. Railway, AIR 1929 Bombay 179. (ii) Bai Kokilabai v. Keshavlal Mangaldas & Co., AIR 1942 Bombay 18 (FB). (iii) Bharat Earth Movers Ltd. v. Bhagyamma by Legal Representative & Another, 1975 A.C.J.113 (Karnataka). (iv) Koodalingam v. Supdt. Engineer, 1994 (2) KLT 413 . (v) Vijayaraghavan v. Velu & Another, 1973 KLT 333 . (vi) Malankara Rubber & Produce Co. Ltd. v. Hameed, 2001 (2) KLT739. (vii) Bala Mallamma v. Osmania University, 2002 (3) KLTS.N. 63 Case No.86. (viii) Payyannur Educational Society v. Narayani, 1995 (1) KLT 621 . 11. As far as the question as to whether it is a trade or business of the appellant, we can draw support from the Judgment of the Division Bench of this Court in Payyannur Educational Society v. Narayani ( 1995 (1) KLT 621 ). Therein, the Court held as follows: "We do not think that the word "business" in the section need be restricted to what is synonymous with trade. The use of the conjunction "or" should be understood as disjunctive for covering totally different areas unconnected with "trade". A reference to the Dictionary would reveal that the word "business" has different shades of meanings. Among them the most suitable in the present context is that which "The Oxford Advanced Learners Dictionary of Current English" has given as its third meaning: "Task, duty, concern or undertaking to do a work." Some succinct illustrations have also been given in the said dictionary to drive the meaning home. They are: "It is a teacher's business to help his pupils; I still make it my business to see that money is paid promptly; that is no business of yours." In none of the illustrations the word "business" is used to denote anything connected with trade or commerce. The word business used in S. 12 of the Act has been intended to convey the meaning as the work or task undertaken by the person concerned which are not restricted to trade or commercial work alone. The word "ordinarily" is an elastic term. It is seen used in different statutes. The word has different shades of meaning in different contexts. The word "ordinarily" is employed in S.12 of the Act for a different connotation.
The word "ordinarily" is an elastic term. It is seen used in different statutes. The word has different shades of meaning in different contexts. The word "ordinarily" is employed in S.12 of the Act for a different connotation. That has to be understood in the background of the preceding portion in the section wherein execution of the work carried out through any other person contracted by the principal for this purpose is mentioned. What the principal would have done if he has not contracted with another person to carry out that work ? He himself would have normally done that work or caused it to be done under his supervision. The word "Ordinarily" is used in S. 12 of the Act for projecting that idea. So the word "ordinarily" in S.12 of the Act means "otherwise, normally". We cannot confer any other meaning to the term "ordinarily" as it appeaers in the section." 12. As far as this case is concerned, we are of the view that even without going so far, we can come to the conclusion that the appellant was indulging in a business. He decided to construct the building which was meant to house a shopping complex. Construction of a building was not for his residential purpose. It was indeed a shopping complex which was put up. The intention behind the putting up of the shopping complex would have been to parcel out the constituent units of the building either by way of sale or on rental basis. In whichever way one looks at it, it was done with the intention of earning profit and even in the conventional sense in which the word "business" is understood, there can be no dispute that it could be said that the appellant's business was to put up the building for the purpose of earning profit by either sale or renting it out. The construction could even be sold as a whole. It does not matter also that the construction was being done as a maiden venture and may be his business activities might have ended with the maiden venture. 13. Admittedly, he engaged a contract to carry out the construction. His business may be actual business of selling or renting out the constructed building or its constituent parts. That would be absolutely impossible if the construction is not put up in the first place.
13. Admittedly, he engaged a contract to carry out the construction. His business may be actual business of selling or renting out the constructed building or its constituent parts. That would be absolutely impossible if the construction is not put up in the first place. In fact, constructing the building according to the desirable and required dimensions to make it suitable to potential buyers or tenants, would have been a well thought out idea of the appellant to suit the market conditions. It is in this context that we find that the decision of the Karnataka High Court on which considerable reliance is placed by the learned counsel for the appellant was inapplicable. In the decision of the Karnataka High Court in Bharat Earth Movers Ltd. v. Bhagyamma by Legal Representative & Another, 1975 A.C.J.113, with reference of the words "ordinarily a part of trade and business", the Court took the view that the construction of a building through the contractor of the appellants therein, would not make the construction ordinarily part of the trade and business of the appellant. The appellant's business was the manufacture of earth moving machinery. It was in the said context that the Court took the following view: "9. We find lot of force in the contention of Mr. Sundaraswamy, in view of the plain provisions of section 12(1) of the Act. It will have to be held that construction of a building is not ordinarily a part of the trade or business of the appellant, as it is an undisputed fact that the business of the appellant is to manufacture earth-moving machinery. Hence, it is clear that the work that was to be executed by respondent 2 for the appellant, was not ordinarily a part of the trade or business of the appellant. In this view of the matter, it follows that the second part of section 12(1) of the Act is not satisfied." 14. We would think that the words "ordinarily part of trade or business" are used in the context of Section 12 to mean normally part of the trade or business of a person. In this case, we have already come to the conclusion that the construction of the building is an indispensable part of the appellant's business of letting out the constructed portion or selling the same for profit.
In this case, we have already come to the conclusion that the construction of the building is an indispensable part of the appellant's business of letting out the constructed portion or selling the same for profit. In fact, it could be said that the business of the appellant consisted of constructing and selling or renting out the constructed portion. If that be so, what the appellant could do by himself, he could do through his agent. The purport of Section 12 is to create a deemed employer- employee relationship between the principal employer and the employee of the immediate employer who is brought in by the principal employer as his contractor. 15. In this regard also, we take support of the Judgment of this Court in Payyannur Educational Society v. Narayani, 1995 (1) KLT621. Therein, the Bench observed as follows: "15. Our next endeavour is to ascertain what the legislature meant by the word "ordinarily" in S.12 of the Act. The word "ordinarily" is an elastic term. It is seen used in different statutes. The word has different shades of meaning in different contexts (vide Kailsdh Chandra v. Union of India - AIR 1961 SC 1346 ). If it is used for referring to jurisdictional aspects it may mean "in large majority of cases but not invariably". When the word is used for referring to residential qualification it may sometimes include even temporary residence. But the word "ordinarily" is employed in S. 12 of the Act for a different connotation. That has to be understood in the background of the preceding portion in the section wherein execution of the work carried out through any other person contracted by the principal for this purpose is mentioned. What the principal would have done if he has not contracted with another person to carry out that work? He himself would have normally done that work or caused it to be done under his supervision. The word "Ordinarily" is used in S.12 of the Act for projecting that idea. So the word "ordinarily" in S. 12 of the Act means "otherwise, normally". We cannot confer any other meaning to the term "ordinarily" as it appears in the section. We did not find anything contrary to the above legal position in the decision of the Division Bench of this Court in Vijayaraghavan v. Velu, 1973 KLT 333 ".
So the word "ordinarily" in S. 12 of the Act means "otherwise, normally". We cannot confer any other meaning to the term "ordinarily" as it appears in the section. We did not find anything contrary to the above legal position in the decision of the Division Bench of this Court in Vijayaraghavan v. Velu, 1973 KLT 333 ". The construction of the building was clearly ordinarily a part of the business of the appellant. We do not think that the appellant should be permitted to draw support from the Judgment of the Bombay High court in Rabia Mahomed Tahir v. G.I.P. Railway, AIR 1929 Bombay 179 which was distinguished by the Full Bench of the Bombay High Court in Bai Kokilabai v. Keshavlal Mangaldas & Co., AIR 1942 Bombay 18. 16. In such circumstances, we are of the view that the ingredients of Section 12 appears to us to have been satisfied before the Commissioner and the Commissioner should have actually granted relief on the basis that the appellant was the principal employer. In such circumstances, equally, the appellant should have been given right to proceed against the first opposite party who was the actual employer of the claimant. Accordingly, while we confirm the liability of the appellant, we are of the view that it should be that of a principal employer. In other words, the appellant will be liable to deposit and pay the amount to the claimant. We only make it clear that the appellant can proceed against the first opposite party for the amounts paid by him. The Appeal is disposed of as above.