Payment of Wages Authority lacks jurisdiction absent proof of an employer–employee relationship.

The petitioner-Department implemented a Netherlands Assistance Programme for protected water supply to villages in Medak District and subsequently maintained the scheme through the Rural Water Supply Division, Sangareddy.

Watch-and-ward work relating to the pipelines was entrusted to private contractors under agreements for specified periods, against lump-sum payments, and the petitioner’s case was that respondent No.2 was engaged by those contractors and not by the Department.

Respondent No.2 claimed that he had worked as an NMR Waterman under the petitioner and had been paid less than the applicable S.S.R. rates.

He initiated proceedings under Section 15(2) of the Payment of Wages Act, 1936, initially claiming Rs.40,153 for the period from 1 June 1995 to 31 October 1998 and later adding claims for subsequent periods up to 31 July 2002.

The Authority under the Act allowed the claims and awarded compensation at three times the amount found payable.

The petitioner challenged the order dated 10 October 2002 in P.W. Case No.10 of 1998, contending that no employer–employee relationship existed, that the Authority lacked jurisdiction under Section 15(2), and that the additional claims had been improperly dealt with in the same proceedings.

Whether an employer–employee relationship existed between the petitioner-Department and respondent No.2?

Whether the Authority under the Payment of Wages Act, 1936 had jurisdiction to entertain respondent No.2’s claim under Section 15(2) of the Act?

Whether the writ petition was maintainable under Article 226 despite the alternative appellate remedy under Section 17 of the Payment of Wages Act, 1936?

Whether the impugned order warranted interference by the High Court?

Section 15(2) of the Payment of Wages Act, 1936 confers jurisdiction over claims concerning deductions from or delay in payment of wages, but that jurisdiction presupposes the existence of the statutory employer–employee relationship.

The initial burden of proving that relationship rests on the person asserting it; only after that foundational fact is established does the evidentiary burden shift to the alleged employer.

The Court relied on General Manager, U.P. Co-operative Bank Ltd. v. Achchey Lal, which identifies appointment, payment of remuneration, power of dismissal, disciplinary control, terms of service, and supervision as relevant tests.

The Court relied on Indraprastha Gas Ltd. v. Ambrish Kumar, N.C. John v. Secretary, Thodupuzha Taluk Shop and Commercial Establishment Worker’s Union, and Swapan Das Gupta v. First Labour Court of West Bengal for the rule that the claimant must establish the employer–employee relationship and that an adverse inference cannot substitute for proof.

Availability of an alternative remedy is not an absolute bar to writ jurisdiction where the impugned order suffers from jurisdictional error or is founded on an erroneous assumption of jurisdiction, as recognised in Whirlpool Corporation v. Registrar of Trade Marks and the other authorities cited by the Court.

The Court held that respondent No.2 produced no appointment order, wage register, muster roll, wage record, or other cogent material proving that he had been appointed, paid, or controlled by the petitioner-Department.

In contrast, the petitioner produced agreements showing that the pipeline watch-and-ward work had been entrusted to contractors who received lump-sum payments and were responsible for executing the work.

The Authority wrongly shifted the burden to the petitioner merely because the contractor failed to appear and certain records were not produced; those circumstances could not discharge respondent No.2’s initial burden of proving the foundational employment relationship.

Since that relationship was not established, no claim for deduction or delayed payment of wages could be maintained against the petitioner under Section 15(2).

The Court further held that the alternative remedy under Section 17 did not preclude writ jurisdiction because the Authority had assumed jurisdiction on the erroneous premise that respondent No.2 was an employee of the Department.

The writ petition was held maintainable notwithstanding the alternative remedy under Section 17 because the impugned order involved a jurisdictional error.

Accordingly, the writ petition was allowed, the Authority’s order dated 10 October 2002 in P.W. Case No.10 of 1998 was set aside, pending miscellaneous petitions were closed, and no order as to costs was made.