Bonded Labour System

A Project submitted in total fulfilment of the course Labour Law-II Semester – Vth
during the Academic Year 2019 – 20

Submitted by
Aanchal, 181602
Sudarshan Kumar, 181653
BBA.LLB
Submitted to
Ms. Pallavi Shankar
Faculty of Labour Law-II

August 2019

Chanakya National Law University

Nyaya Nagar, Mithapur

800001, Patna
Tentative Chapterisation
1. Declaration
2. Acknowledgement
3. Research Methodology
4. Aims & Objectives
5. Introduction
6. Constitutional Provision
7. Definitions
8. Abolition Of Bonded Labour System
9. Extinguishment Of Liability To Repay Bonded Debt
10. Implementing Authorities
11. Vigilance Committees
12. Offences And Procedure For Trial
13. Conclusion
14. Recommendations
15. Bibliography
 Declaration
I hereby declare that the work reported in the B.B.A., LL.B. (Hons.) Project Report entitled
“Bonded Labour System” for the fifth semester, submitted at Chanakya National Law
University, Patna, is an authentic record of my work carried out under the supervision of Ms.
Pallavi Shankar. I have not submitted this work elsewhere for any other degree or diploma. I
am fully responsible for the contents of my Project Report.

__________________________

(Signature of the Candidate)

Aanchal

Roll-181602

Sudarshan Kumar
Roll - 181653
Chanakya National Law University, Patna
 Acknowledgement
It is a genuine pleasure to express my deep sense of thanks and gratitude to my guide, Ms.
Pallavi Shankar Mam, Faculty Of Labour Law II at Chanakaya National Law University,
Patna. Her dedication and keen interest in making us understand every part of his subject very
clearly, is solely responsible for completing my work. Her timely advice, meticulous scrutiny,
scholarly advice and methodological approach helped to me a very great extent to accomplish
this task, assigned by him.

I also owe a deep sense of gratitude to my respected university, Chanakaya National Law
University, Patna, as it ensures to provide us with great opportunities to enhance our knowledge
on the ongoing study topic, by assigning us such research projects for every subject we are
supposed to pass through.

Lastly, I would like to extend my gratitude to my parents and all those unseen hands who helped
me out at every stage of my project.
Research Methodology

For this study, primary research method was utilised. Various e-articles, reports, magazines and
books from library were used extensively in framing all the data and figures in appropriate form,
essential for this study.

The method of writing used in this research project is primarily analytical.

Aims & Objectives

The researcher has undertaken this research to find out the provisions of the Bonded Labour System
in details Under Labour Law.

Sources of Data :

The researcher has relied on the following secondary sources of data:

 Books
 Websites
 Articles

Hypothesis :

Before doing the research work, the researcher had certain hypothesis which were to be tested during
research. The hypothesis is following-
1. Bonded Labour System still prevailing.
2. The provision related to prevention of Bonded Labour System is effectual enough.
Introduction :

Labour or labour may refer to:

 Manual labour, physical work done by people

 Wage labour, a socioeconomic relationship between a worker and an employer
 Labour Party (disambiguation), several political parties

. The practice of bonded labour was prevalent in the Indian society. Under this system when an elder
of an Indian family took a loan mostly for agriculture and fails to repay the same, his descendants or
dependents have to work for the creditor without reasonable wages until the loan is repaid. This
system is commonly known as Bandhua Mazdoori (बंधुआ मज़दूरी). Also it is to be mentioned here that
because of illiteracy and backwardness the loan structure was made in a way that the interest over a
small period of time will be greater than the principal sum and then there was interest charged on the
already existing interest. Hence the loans were made in a way that they cannot be repaid. Several
generations are made to work in degradable condition and extreme poverty under this system. Even
after India got independence and Indian Constitution came to power that enshrines the principal of
Equality and Dignity. The practice of Bandhua Mazdoori (बंधुआ मज़दूरी) continued.

With an aim to end this practice, Indian Parliament enacted Bonded Labor System (Abolition) Act,
1976.

High prevalence in UP, Bihar and Karnataka

Social customs and economic compulsions have kept the bonded labour system alive and kicking,
according to the Union Ministry of Labour and Employment. As many as 13,512 bonded labourers
were released and rehabilitated in the last four years (an average of nine daily).

The data presented by the Ministry to the Lok Sabha last month revealed that the inhuman system
prevails strong in Uttar Pradesh where 6,707 bonded labourers were released and rehabilitated during
this period. Figures for States such as Bihar, Odisha, Chhattisgarh and Karnataka show that the
system continues unabated in these States. UP, Bihar and Karnataka are the top three States where
bonded labourers were found. In Bihar, 2,491 bonded labourers and 1,681 in Karnataka were
released and rehabilitated in four years. Puducherry is the only Union Territory that appears in the
list.

“Instances of prevalence of bonded labour system are noticed now and then even after its abolition.
The root of the problem lies in the social customs and economic compulsions,” the Minister of State
for Labour and Employment told the Lok Sabha. The system has been abolished by law throughout
the country with effect from October 25, 1975 under the Bonded Labour System (Abolition)
Ordinance which was replaced by the Bonded Labour System (Abolition) Act, 1976.

Historical context
“Bonded Labour or bandhua mazdoori was historically associated with rural economies where
peasants from economically disadvantaged communities were bound to work for the landlords. In the
present times, however, bonded labour is found to exist in both rural and urban pockets in
unorganised industries such as brick kilns, stone quarries, coal mining, agricultural labour, domestic
servitude, circus and sexual slavery,” states the Policy Report on Modern Day Slavery by Ajita
Banerjie, published by The Hindu Centre for Politics and Public Policy.

The report adds that the action taken by the State to end the labour bondage is ineffective, while the
efforts of non-government organisations have been more on release than rehabilitation. The Global
Slavery Index estimates that on any given day in 2016, there were nearly 8 million people living in
modern slavery in India. In terms of prevalence of modern slavery in India, there were 6.1 victims
for every thousand people.
Constitutional Provision

Article 21 of the Constitution of India guarantees the right to life and liberty. The Indian Supreme
Court has interpreted the right of liberty to include, among other things, the right of free movement,
the right to eat, sleep and work when one pleases, the right to be free from inhuman and degrading
treatment, the right to integrity and dignity of the person, the right to the benefits of protective labour
legislation, and the right to speedy justice. The practice of bonded labour violates all of these
constitutionally-mandated rights.

Article 23 of the Constitution prohibits the practice of debt bondage and other forms of slavery
both modern and ancient. Traffic in human beings and beggar and other similar forms of
forced labour are prohibited and any contravention of this provision shall be an offence punishable in
accordance with the law.

Beggar is a form of forced labour under which a person is compelled to work without receiving any
remuneration. Other similar forms of forced labour were interpreted the Supreme Court when it ruled
in the Asiad Workers Case1 that:

both unpaid and paid labour were prohibited by Article 23, so long as the element of force or
compulsion was present in the worker's ongoing services to the employer. The Supreme Court also
interpreted the term forced labour to mean providing provides labour or service to another for
remuneration which is less than minimum wage. All labour rewarded with less than the minimum
wage, then, constitutes forced labour and violates the Constitution of India. The Supreme Court ruled
that:

 it is the plainest requirement of Articles 21 and 23 of the Constitution that bonded labourers must
be identified and released and on release, they must be suitably rehabilitated.... any failure of action on
the part of the State Governments in implementing the provisions of the Bonded Labour System
(Abolition) Act would be the clearest violation of Article 21 and Article 23 of the Constitution.

Article 24 prohibits the employment of children in factories, mines, and other hazardous
occupations. Together, Articles 23 and 24 are placed under the heading "Right against Exploitation,"
one of India's constitutionally-proclaimed fundamental rights.

Article 39 requires the state to "direct its policy toward securing":

1
AIR 1982 S.C. 1473
 (e) that the health and strength of workers... and the tender age of children are not abused and that
citizens are not forced by economic necessity to enter avocations unsuited to their age or strength.

(f) that children are given opportunities and facilities to develop in a healthy manner and in
conditions of freedom and dignity and that childhood and youth are protected against exploitation and
against moral and material abandonment."

Definition
Section 2 (g) "bonded labour system" means the system of forced, or partly forced, labour under
which a debtor enters, or has, or is presumed to have, entered, into an agreement with the creditor to
the effect that,--

(i) in consideration of an advance obtained by him or by any of his lineal ascendants or descendants
(whether or not such advance is evidenced by any document) and in consideration of the interest, if
any, due on such advance, or

(ii) in pursuance of any customary or social obligation, or

(iii) in pursuance of an obligation devolving on him by succession, or

(iv) for any economic consideration received by him or by any of his lineal ascendants or
descendants, or

(v) by reason of his birth in any particular caste or community,

he would--

(1) render, by himself or through any member of his family, or any person dependent on him, labour
or service to the creditor, or for the benefit of the creditor, for a specified period or for an unspecified
period, either without wages or for nominal wages, or

(2) forfeit the freedom of employment or other means of livelihood for a specified period or for an
unspecified period, or

(3) forfeit the right to move freely throughout the territory of India, or

(4) forfeit the right to appropriate or sell at market value any of his property or product of his labour
or the labour of a member of his family or any person dependent on him,
and includes the system of forced, or partly forced, labour under which a surety for a debtor enters,
or has, or is presumed to have, entered, into an agreement with the creditor to the effect that in the
event of the failure of the debtor to repay the debt, he would render the bonded labour on behalf of
the debtor.

Explanation.--For the removal of doubts, it is hereby declared that any system of forced, or partly
forced labour under which any workman being contract labour as defined in clause (b) of sub-
section (1) of section 2 of the Contract Labour (Regulation and Abolition) Act, 1970 (37 of 1970), or
an inter-State migrant workman as defined in clause (e) of sub-section (1) of section 2 of the Inter-
State Migrant Workmen (Regulation of Employment and Conditions of Service) Act, 1979 (30 of
1979), is required to render labour or service in circumstances of the nature mentioned in sub-
clause (1) of this clause or is subjected to all or any of the disabilities referred to in sub-
clauses (2) to (4), is "bonded labour system" within the meaning of this clause; of The Bonded
Labour System (Abolition) Act 1976 deals with the definition of Bonded labour System means the
system of forced, or partly forced labour under which a debtor enters, or has, or is pursued to have,
entered, into an agreement with the creditor

A man keeping another man in perpetual bondage for his selfish and personal designs is a kind of
man’s cruelty to man which is not confined to a particular country or a particular region but is found
as a global phenomenon for thousands of years, right from the Biblical days to the present era. The
nomenclature changed from period to period and place to place: slave, serf, and bonded labour.

In India, this type of exploitation of man remained prevalent in the name of beggar and riot for years.
The term ‘bonded labour’ or bandhua mazdoor is of recent origin. Despite the abolition of the
zamindari system, land reforms, Bhoodan movement, enactment of legislation (Bonded Labour
Abolition Act, 1976), establishment of Panchayati Raj, interest shown by Social Action Groups and
spirited individuals from society, lakhs of bonded labourers continue to be exploited and carry the
yoke of neglect, suffering and frustration in abject silence.

The ‘bonded labour system’ refers to “the relationship between a creditor and a debtor who obtains
loan owing to economic compulsions confronting his day-to-day life, and agrees to abide by the
terms dictated by the creditor”.
The important term of agreement is that the debtor agrees to mortgage his services or services of any
or all the members of his family for a specified or unspecified period. The relationship built on the
agreement is on such unequal terms that while for every labour or service, there must be some fair
remuneration equivalent to the price of labour in the market, under the bonded labour system the
service is rendered for the debt or in lieu of the interest accruing to the debt. The debtor either works
without receiving any remuneration or if at all there is any remuneration, it is much less than the
minimum wage (notified under the Minimum Wages Act) or the prevailing rate of market wage.

The 1976 Bonded Labour (Abolition) Act defines ‘bonded labour system’ as “the system of forced
labour under which a debtor enters into an agreement with the creditor that he would render service
to him either by himself or through any member of his family or any person dependent on him, for a
specified or unspecified period, either without wages or for nominal wages, in consideration of loan
or any other economic consideration obtained by him or any of his ascendants, or in pursuance of
any social obligation, or in pursuance of any obligation devolving on him by succession”.
Abolition of Bonded Labour System

Section 4. Abolition of bonded labour system.—

(1) On the commencement of this Act, the bonded labour system shall stand abolished and every
bonded labourer shall, on such commencement, stand freed and discharged from any obligation to
render any bonded labour.

(2) After the commencement of this Act, no person shall—

(a) make any advance under, or in pursuance of, the bonded labour system, or

(b) compel any person to render any bonded labour or other form of forced labour. COMMENTS
The bonded labour system has been abolished from 25th October, 1975 and every bonded labourer
has been set free and has been discharged from any obligation to render any bonded labour from this
date. No person is allowed to make an advance under, or in pursuance of the bonded labour system.
No one can compel any person to render any bonded labour or other form of forced labour.

Under Article 42. Provision for just and humane conditions of work and maternity relief - The State
shall make provision for securing just and humane conditions of work and for maternity relief.

Under Article 43. Living wage, etc. for workers - The State shall endeavour to secure, by suitable
legislation or economic organization or in any other way, to all workers, agricultural, industrial or
otherwise, work and living wage, conditions of work ensuring a decent standard of life and full
enjoyment of leisure and social and cultural opportunities and, in particular the State shall endeavour
to promote cottage industrial on an individual or co-operative basis in rural areas.

Universal Declaration Of Human Rights, 1948

 The Preamble of the UDHR recognizes dignity as an inherent in the human family and as a
foundation of freedom, justice and peace in the world. Article 1 says that all human beings are born
free and equal in dignity and rights. Further the general assembly proclaimed abolition of slave labour,
by articles 4,13(1). 23(1) as shown hereunder:

Article 4[3] – no one shall be held in slavery or servitude

Article 13(1) – everyone has the right to freedom of movement and residence within the borders of
each state

Article 23(1) – everyone has the right to work, to free choice of employment and to protection
against employment

Article 4 of the European Convention of the Human Rights 1956 is to the same effect and
forced labour or slavery is rightly declared inhuman.

 
Extinguishment of Liability to Repay Bonded Debt

Section 6 of Bonded Labour System (Abolition) Act 1976 deals with the provision of Liability To
Repay Bonded Debt To Stand Extinguished:-

(1) On the commencement of this Act, every obligation of a bonded labourer to repay any bonded
debt, or such part of any bonded debt as remains unsatisfied immediately before such
commencement, shall be deemed to have been extinguished.

(2) After the commencement of this Act, no suit or other proceeding shall lie in any civil court or
before any other authority for the recovery of any bonded debt or any part thereof

(3) Every decree or order for the recovery of bonded debt, passed before the commencement of this
Act and not fully satisfied before such commencement, shall be deemed, on such commencement, to
have been fully satisfied.

(4) Every attachment made before the commencement of this Act, for the recovery of any bonded
debt, shall, on such commencement, stand vacated; and, where, in pursuance of such attachment, any
movable property of the bonded labourer was seized and removed from his custody and kept in the
custody of any court or other authority pending sale thereof, such movable property shall be restored,
as soon as may be practicable after such commencement, to the possession of the bonded labourer.

(5) Where, before the commencement of this Act, possession of any property belonging to a bonded
labourer or a member of his family or other dependant was forcibly taken over by any creditor for the
recovery of any bonded debt, such property shall be restored, as soon as may be practicable after
such commencement, to the possession of the person from whom it was seized.
(6) If restoration of the possession of any property referred to in sub-section (4) or sub-section (5) is
not made within thirty days from the commencement of this Act, the aggrieved person may, within
such time as may be prescribed, apply to the prescribed authority for the restoration of the possession
of such property and the prescribed authority may, after giving the creditor a reasonable opportunity
of being heard, direct the creditor to restore to the applicant the possession of the concerned property
within such time as may be specified in the order.
(7) An order made by any prescribed authority, under sub-section (6), shall be deemed to be an order
made by a civil court and may be executed by the court of the lowest pecuniary jurisdiction within
the local limits of whose jurisdiction the creditor voluntarily resides or carries on business or
personally works for gain.

(8) For the avoidance of doubts, it is hereby declared that, where any attached property was sold
before the commencement of this Act, in execution of a decree or order for the recovery of a bonded
debt, such sale shall not be affected by any provision of this Act:

Provided that the bonded labourer, or an agent authorised by him in this behalf, may, at any time
within five years from such commencement, apply to have the sale set aside on his depositing in
court, for payment to the decree-holder, the amount specified in the proclamation of sale, for the
recovery of which the sale was ordered, less any amount, as well as mesne profits, which may, since
the date of such proclamation of sale, have been received by the decree-holder.

(9) Where any suit or proceeding, for the enforcement of any obligation under the bonded labour
system, including a suit or proceeding for the recovery of any advance made to a bonded labourer, is
pending at the commencement of this Act, such suit or other proceeding shall, on such
commencement, stand dismissed.

(10) On the commencement of this Act, every bonded labourer who has been detained in civil prison,
whether before or after judgment, shall be released from detention forthwith.
Implementing Authorities

Section 10 of The Bonded Labour System (Abolition) Act, 1976 deals with

the Authorities who may be specified for implementing the provisions of this Act.—The State
Government may confer such powers and impose such duties on a District Magistrate as may be
necessary to ensure that the provisions of this Act are properly carried out and the District Magistrate
may specify the officer, subordinate to him, who shall exercise all or any of the powers, and perform
all or any of the duties, so conferred or imposed and the local limits within which such powers or
duties shall be carried out by the officer so specified.

Section 11 of The Bonded Labour System (Abolition) Act, 1976 deals with the Duty of District
Magistrate and other officers to ensure credit.- The District Magistrate authorized by the State
Government under section 10 and the officer specified by the District Magistrate under that section
shall, as far as practicable, try to promote the welfare of the freed bonded labourer by securing and
protecting the economic interests of such bonded labourer so that he may not have any occasion or
reason to contract any further bonded debt.

Section 12 of The Bonded Labour System (Abolition) Act, 1976 deals with the Duty of District
Magistrate and officers authorized by him.- It shall be the duty of every District Magistrate and every
officer specified by him under section 10 to inquire whether, after the commencement of this Act,
any bonded labour system or any other form of forced labour is being enforced by, or on behalf of,
any person resident within the local limits of his jurisdiction and if, as a result of such inquiry, any
person is found to be enforcing the bonded labour system or any other system of forced labour, he
shall forthwith take such action as may be necessary to eradicate the enforcement of such forced
labour.

Vigilance Committees

Section 13 of The Bonded labour System (Abolition) Act, 1976 deals with Vigilance Committees.-
(1) Every State Government shall, by notification in the Official Gazette, constitute such number of
Vigilance Committees in each district and each Sub-Division as it may think fit.

(2) Each Vigilance Committee, constituted for a district, shall consist of the following members,
namely: --

(a) the District Magistrate, or a person nominated by him, who shall be the Chairman;

(b) three persons belonging to the Scheduled Castes or Scheduled Tribes and residing in the district,
to be nominated by the District Magistrate;

(c) two social workers, resident in the district, to be nominated by the District Magistrate;

(d) not more than three persons to represent the official or non-official agencies in the district
connected with rural development, to be nominated by the State Government;

(e) one person to represent the financial and credit institutions in the district, to be nominated by the
District Magistrate.

(3) Each Vigilance Committee, constituted for a Sub-Division, shall consist of the following
members, namely:--

(a) the Sub-Divisional Magistrate, or a person nominated by him, who shall be the Chairman;
(b) three persons belonging to the Scheduled Castes or Scheduled Tribes and residing in the Sub-
Division, to be nominated by the Sub-Divisional Magistrate;

(c) two social workers, resident in the Sub-Division, to be nominated by the Sub-Divisional
Magistrate;

(d) not more than three persons to represent the official or non-official agencies in the Sub-Division
connected with rural development to be nominated by the District Magistrate;

(e) one person to represent the financial and credit institutions in the SubDivision, to be nominated
by the Sub-Divisional Magistrate;

(f) one officer specified under section 10 and functioning in the Sub-Division.

(4) Each Vigilance Committee shall regulate its own procedure and secretarial assistance, as may be
necessary, shall be provided by—

(a) the District Magistrate, in the case of a Vigilance Committee constituted for the district;

(b) the Sub-Divisional Magistrate, in the case of a Vigilance Committee constituted for the Sub-
Division.

(5) No proceeding of a Vigilance Committee shall be invalid merely by reason of any defect in the
constitution, or in the proceedings, of the Vigilance Committee.

Section 14 of The Bonded Labour System (Abolition) Act, 1976 deals with the Functions of
Vigilance Committees.- (1) The functions of each Vigilance Committee shall be,-- (a) to advise the
District Magistrate or any officer authorized by him as to the efforts made, and action taken, to
ensure that the provisions of this Act or of any rule made thereunder are properly implemented;

(b) to provide for the economic and social rehabilitation of the freed bonded labourers;

(c) to co-ordinate the functions of rural banks and co-operative societies with a view to canalizing
adequate credit to the freed bonded labourer;

(d) to keep an eye on the number of offences of which cognizance has been taken under this Act;

(e) to make a survey as to whether there is any offence of which cognizance ought to be taken under
this Act;

(f) to defend any suit instituted against a freed bonded labourer or a member of his family or any
other person dependent on him for the recovery of the whole or part of any bonded debt or any other
debt which is claimed by such person to be bonded debt.
(2) A Vigilance Committee may authorize one of its members to defend a suit against a freed bonded
labourer and the member so authorized shall be deemed, for the purpose of such suit, to be the
authorized agent of the freed bonded labourer.

Section 15 Of The Bonded Labour System (Abolition) Act, 1976 deals with the provision of Burden
of proof.- Whenever any debt is claimed by a bonded labourer, or a Vigilance Committee, to be a
bonded debt, the burden of proof that such debt is not a bonded debt shall lie on the creditor.

OFFENCES AND PROCEDURE FOR TRIAL

Section 16 of The Bonded Labour System (Abolition) Act, 1976 deals with the provision of
Punishment for enforcement of bonded labour.- Whoever, after the commencement of this Act,
compels any person to render any bonded labour shall be punishable with imprisonment for a term,
which may extend to three years and also with fine, which may extend to two thousand rupees.

Section 17 of The Bonded Labour System (Abolition) Act, 1976 deals with the provision of
Punishment for advancement of bonded debt.- Whoever advances, after the commencement of this
Act, any bonded debt shall be punishable with imprisonment for a term , which may extend to three
years and also with fine which may extend to two thousand rupees.

Section 18 of The Bonded Labour System (Abolition) Act, 1976 deals with the provision of
Punishment for extracting bonded labour under the bonded labour system.- Whoever enforces, after
the commencement of this Act, any custom, tradition, contract, agreement or other instrument, by
virtue of which any person or any member of the family of such person or any dependant of such
person is required to render any service under the bonded labour system shall be punishable with
imprisonment for a term which may extend to three years and also with fine which may extend to
two thousand rupees; and, out of the fine, if recovered, payment shall be made to the bonded labourer
at the rate of rupees five for each day for which the bonded labour was extracted from him.
Section 19 of The Bonded Labour System (Abolition) Act, 1976 deals with the provision of
Punishment for omission or failure to restore possession of property to bonded labourers.- Whoever,
being required by this Act to restore any property to the possession of any bonded labourer, omits or
fails to do so, within a period of thirty days from the commencement of this Act, shall be punishable
with imprisonment for a term which may extend to one year, or with fine which may extend to one
thousand rupees, or with both; and, out of the fine, if recovered, payment shall be made to the
bonded labourer at the rate of rupees five for each day during which possession of the property was
not restored to him.

Section 20 of The Bonded Labour System (Abolition) Act, 1976 with the provision of Abetment to
be an offence.- Whoever abets any offence punishable under this Act shall, whether or not the
offence abetted is committed, be punishable with the same punishment as is provided for the offence,
which has been abetted.

Explanation, -- For the purpose of this Act, "abetment" has the meaning assigned to Section 108 of
the Indian Penal Code (46 of 1860).

Section 21 of The Bonded Labour System (Abolition) Act, 1976 deals with the provision of
Offences to be tried by Executive Magistrates.- (1) The State Government may confer, on an
Executive Magistrates, the powers of a Judicial Magistrate of the first class or of the second class for
the trial of offences under this Act; and, on such conferment of powers, the Executive Magistrate, on
whom the powers are so conferred, shall be deemed, for the purposes of the Code of Criminal
Procedure, 1973 (2 of 1974), to be a Judicial Magistrate of the first class, or of the second class, as
the case may be.

(2) An offence under this Act may be tried summarily by a Magistrate.

Section 22 of The Bonded Labour System (Abolition) Act, 1976 deals with the provision of
Cognizance of offences.- Every offence under this Act shall be cognizable and bail able.

Section 23 of The Bonded Labour System (Abolition) Act, 1976 deals with the provision of
Offences by companies.- (1) Where an offence under this Act has been committed by a company,
every person who, at the time the offence was committed, was in charge of, and was responsible to,
the company for the conduct of the business of the company, as well as the company, shall be
deemed to be guilty of the offence and shall be liable to be proceeded against and punished
accordingly.

(2) Notwithstanding anything contained in sub-section (1), where any offence under this Act has
been committed by a company and it is proved that offence has been committed with the consent or
connivance of, or is attributable to, any neglect on the part of, any director, manager, secretary or
other officer of the Company, such director, manager, secretary or other officer shall be deemed to
be guilty of that offence and shall be liable to be proceeded against and punished accordingly.
Explanation- For the purposes of this section,--

(a) "company" means any body corporate and includes a firm or other association of individuals; and
(b) "director” in relation to a firm, means a partner in the firm.

Case Laws

In Sanjit Ray v. State of Rajasthan2, the SC restricted the state from extracting labour by paying
less than the minimum wages in the name of public utility services, considering such amounts to
forced labour and is violative of article 23 of the constitution. Therefore, labour must be compensated
with wages even when they are under law compelled to render service in the larger public interest.

In Bandhua Mukti Morcha v. Union of India3, the main issue concerned the existence of
bonded labour in the Faridabad stone quarries near the city of Delhi. It was alleged that majority of the
workers were compelled to migrate from other states, and turned into bonded labourers. The workers
were living in sub-human and miserable conditions. A violation of various labour laws and the
Bonded Labour System (Abolition) Act 1976 was alleged. The SC stated that before

a bonded labour can be regarded as a bonded labourer, he must not only be forced to

provide labour to the employer but he must have also received an advance or other economic
consideration from the employer, unless he is made to provide forced labour in pursuance of any
custom or social obligation or by reason of his birth in any particular caste or community.  

2
AIR 1982 S.C. 1473
3
AIR 1984 S.C. 802
 Whenever it is shown that a labourer is made to provide forced labour, the court would raise a
presumption that he is required to do so in consideration of an advance or other economic
consideration received by him and he is, therefore, a bonded labourer. But unless and until satisfactory
evidence is produced for rebutting this presumption the court must proceed on the basis that
the labourer is a bonded labourer entitle to the benefit under the provision of the
Bonded Labour System (Abolition) Act, 1976. The courts also recognized the right of
bonded labourers to live with human dignity. It read the Directive Principles of State Policy into
article 21 of the constitution to make the right to live with human dignity fruitful to the working class
of the country. The stand in the Asiad case4, was reiterated that the state is under a constitutional
obligation to see that there is no violation of any fundamental rights of person, particularly when he
belongs to the weaker section of the community and is unable to wage a legal battle against a strong
and powerful opponent who is exploiting him. The Central government is bound to ensure observance
of social welfare and labour laws enacted by the parliament for the purpose of securing to the
workmen a life of basic human dignity in compliance with the Directive Principles of State Policy.

In Neerja Choudhary v. State of MP5, the main issue in this case related to the effective
rehabilitation of the released bonded labourers. The petitioners alleged that even after a lapse of a long
time 135 labourers of the Faridabad stone quarries were not rehabilitated.  They further alleged that it
was the obligation on the part of the state government to rehabilitate the bonded labourers according
to the provisions of the Bonded Labour System (Abolition) Act 1976 and it is the fundamental right of
the bonded labourers under article 21 of the constitution. The petitioners therefore prayed for a
direction to the state government to take steps for the economic and social rehabilitation of
the labourers who were released from the shackles of bondage. The SC said that the plainest
requirement of article 21, 23 that the bonded labourers must be identified and released and on release,
they must be suitably rehabilitated. The act has been enacted with a view to ensuring human dignity to
the bonded laborers and any failure of action on part of the state government, in implementing the
provisions of this legislation would be the clearest violation of article 21, 23 of the Constitution. The
courts  also said that it is not enough merely to identify and release bonded labourers, but it is equally
important that after identification and release, they must be rehabilitated, because without
rehabilitation, they would be driven by poverty, helplessness and despair into serfdom once again.

    

4
AIR 1982 S.C. 1473 at p. 1482
5
AIR 1984 S.C. 1099
 In P. Sivaswamy v. State of A.P[9], the courts found that the rehabilitation money payable under the
Bonded Labour System (Abolition) Act, 1976 came down to Rs. 738/- per family. The Court observed
that the assistance was certainly inadequate for rehabilitation and unless there was effective
rehabilitation the purpose of the Act would not be fulfilled. Up-rooted from one place of
bonded labour conditions the persons are likely to be subjected to the same mischief at another place,
the net result being that the steps taken by the Supreme Court would be rendered ineffective.

In Balram and others v. State of M.P.6, the main issue was to determine whether the state and
central governments had given the benefit of the scheme framed under the Bonded Labourers Act
(whereby each bonded labourer was to be paid Rs. 6, 250/- as rehabilitation money) to some
3949 labourers in the state. The court directed that the Additional Collector and such, other officers
who have been assigned the responsibility of supervising rehabilitation to ensure that the full amount
intended for the freed labourers reaches them. Therefore, all such persons who were willing to have an
account opened in their respective names for facilitating credit of the amount in such account shall
have accounts opened and the money shall be credited in such accounts. The Union of India was also
directed to release adequate funds under the Scheme to meet the liability under the Scheme framed
under the Bonded Labour System (Abolition) Act, 1976 within four weeks to enable compliance of the
directions now made. Similar directions were also issued to the State of Madhya Pradesh.

 A public interest litigation was brought against the inhuman working conditions in the stone
quarries in Bandhua Mukti Morcha v. Union of India and others 7.  This was primarily brought as
the various directions given by the Apex Court in the 1984 petition brought by the same appellants had
not been implemented by the various state governments. It may be noted that in this case a letter
addressed to this Court complaining about prevalence of bonded labour system in Cutton, Anagpur
and Lakkaarpur areas in Haryana, was treated as a writ petition under Art. 32 of the Constitution.The
Court held that what is necessary is provision of a permanent base for residence of the labourers, at or
near the work site. This would necessitate reasonable housing, supply of water, a reasonable provision
store at hand, schooling facility, facility of a hospital, recreational facilities and attention to the law and

6
AIR 1988 S.C. 1863

7
AIR 1990 S.C. 44
order problem. The court directed the State of Haryana to attend to the needs of the workmen in a well-
considered and systematic way and to provide them with the facilities mentioned above.

In Bandhua Mukti Morcha v. Union of India and others[12], the main issue involved was whether
the employment of the children below the age of 14 years was violative of Article 24 and whether the
omission on the part of the State to provide welfare facilities and opportunities deprives them of the
constitutional mandates contained in Articles 45, 39(e) and (f), 21, 14 etc.?The Supreme Court while
dealing with the issue held that while exploitation of the child must be progressively banned, other
simultaneous alternatives to the child should be evolved including providing education, health care,
nutrient food, shelter and other means of livelihood with self-respect and dignity of person. Therefore
the Court ordered the Government of India to convene a meeting of the concerned Ministers of the
respective State Governments and their Principal Secretaries holding concerned Departments, to
evolve the principles and policies for progressive elimination of employment of the children below the
age of 14 years in all employments governed by the respective enactments mentioned in M.C.
Mehta'8s case - To provide (1) compulsory education to all children either by the industries itself or in
co-ordination with it by the State Government with such timings as is convenient to impart compulsory
education, facilities for secondary, vocational profession and higher education; (2) apart from
education, periodical health check-up; (3) nutrient food etc.; (4) entrust the responsibilities for
implementation of the principles. Periodical reported of the progress made in that behalf be submitted
to the Registry of this Court.

 Thus the Supreme Court set a new constitutional standard at a time when state on its part had
completely neglected the human values. The court further remarked that the state government is under
the constitutional scheme, charged with the mission of bringing about a new socio-economic order
where there will be socio-economic justice for everyone and equality of status and opportunity for all. 

8
 AIR 1992 S.C. 38
Conclusion

The Bonded Labour System (Abolition) Act was enacted in 1976. Twenty years later, Human
Rights Watch has found that the goals of this law-to punish employers of bonded labour and to
identify, release, and rehabilitate bonded labourers-have not been met. The bonded labour system
continues to thrive.

The district-level vigilance committees, mandated by the Bonded Labour System (Abolition) Act

and constituting the key to the enforcement of the act, have not been formed in most districts. Those
that have formed tend to lie dormant or, worse yet, are comprised of members unsympathetic to the
plight of bonded laborers.

Whether for lack of will or lack of support, India's district collectors have failed utterly to enforce
the provisions of the Bonded Labour System (Abolition) Act. The state of Tamil Nadu has an
estimated one million bonded labourers; according to the North Arcot District Collector, these were the
first charges ever brought under the act in Tamil Nadu.

The mandated rehabilitation of released workers is essential. Without adequate rehabilitation, those
who are released will quickly fall again into bondage. This has been established repeatedly, among
both adult and child bonded laborers. Nonetheless, the central and state governments have jointly
failed to implement the required rehabilitation procedures. Rehabilitation allowances are distributed
late, or are not distributed at all, or are paid out at half the proper rate, with corrupt officials pocketing
the difference. One government-appointed commission found that court orders mandating the
rehabilitation of bonded laborers were routinely ignored.

Finally, the Bonded Labour System (Abolition) Act directs vigilance committees and district
collectors to institute savings and credit programs at the community level, so that the impoverished
might have access to a small loan during financial emergencies. This resource is crucial. Just as
enforcement of the law against employers would work to terminate the demand for bonded labour, so
would available credit work to end the supply. Nearly every child interviewed by Human Rights
Watch told the same story: they were sold to their employers because their parents were desperate for
money and had no other way to get it. For some, it was the illness or death of a parent, for others, the
marriage of a sister, and for others still, the need to buy food or put a roof over their heads. In most
cases, the amount of the debt incurred was very small.

The eradication of bonded child labor in India depends on the Indian government's commitment to
two imperatives: enforcement of the Bonded Labour System (Abolition) Act, and the creation of
meaningful alternatives for already-bonded laborers and those at risk of joining their ranks. In addition
to genuine government action, it is essential that non-governmental organizations be encouraged by the
government to collaborate in this effort. The government has the resources and authority to implement
the law, while community-based organizations have the grass-roots contacts and trust necessary to
facilitate this implementation. Furthermore, non-governmental groups can act as a watchdog on
government programs, keeping vigil for corruption, waste, and apathy. The elimination of current debt
bondage and the prevention of new or renewed bondage therefore requires a combination of concerted
government action and extensive community involvement. Neither standing alone is sufficient. Bonded
labor is a vast, pernicious, and long-standing social ill, and the tenacity of the bonded labor system
must be attacked with similar tenacity; anything less than total commitment is certain to fail.
Recommendations

1. Carry out comprehensive and independent national surveys to identify the total number of
bonded labourers in the country. These surveys should include breakdowns of dalit bonded labourers
and those who have to provide forced labour for landlords (begar).

2. All local and national officials responsible for implementing the bonded labour laws (including
District Magistrates, Vigilance Committees, the police, etc.) must be properly trained and function
effectively, so that they actively seek out cases of bonded labour and ensure immediate release and
rehabilitation, in compliance with the law.

3. Prosecutions must be initiated against all those who use bonded labour and against those who use
intimidation and violence to retain people as bonded labourers. The number of successful convictions
and sentences passed should be published, by state, on a regular basis.

4. Pressure states and districts to constitute and oversee bonded labour vigilance committees, as

required by the Bonded Labour (System) Abolition Act, 1976.

5. Ensure the active involvement of the Scheduled Castes and Scheduled Tribes Commission in the
process of identifying, releasing, and rehabilitating bonded child laborers.

6. Launch a nationwide public awareness campaign regarding the legal prohibition of bonded labor.
This campaign should explain in simple terms what actions are legally prohibited and what recourses
and resources are available to bonded child laborers and their families.
BIBLIOGRAPHY.

Books:
1. The Bonded Labour System (Abolition) Act, 1976
2. Menon, Meena, “Escape from Bondage”, The Hindu, September 7, 2003, New Delhi Ed
3. Labour and Industrial Law Manual by Justice M.R. Mallick

Websites:

 www.Indiankanoon.com
 www.icsi.edu
 www.legalserviceindia.com
 www.idfcinstitute.org