Bonded Labour System (Abolition ) Act 1976 | Labour and Industrial Law - CLAT PG PDF Download

Background

• Bonded labor is a harmful cycle where various factors contribute to the suffering and exploitation of bonded laborers. It arises from deep-rooted forms of indebtedness affecting vulnerable and economically exploited groups in society.
• Historically, bonded labor was known by different names in different regions of India, such as Begar, Sagri, Hali, Jeetham, etc. The issue gained national attention when it was included in the 20-Point Programme in 1975.

Aims and Objectives of the Act

• The Bonded Labour System Abolition Act of 1976 aims to abolish the bonded labor system to prevent the economic and physical exploitation of vulnerable sections of society.
• The Act addresses the persistent issue of usury, where debtors and their descendants are forced to work for creditors under unfair conditions to repay debts, often taking generations to clear a small sum borrowed by an ancestor.
• It highlights the illegitimacy of such contracts due to exorbitant interest rates and the violation of basic human rights, undermining the dignity of labor.

Bonded Labour under the Indian Constitution

• The Constitution of India guarantees justice, social, economic, and political rights to all citizens, ensuring freedom of thought, expression, belief, and the dignity of individuals.
• Article 23 prohibits traffic in human beings and forced labor, making any violation punishable by law. Article 35(a)(ii) empowers Parliament to impose penalties for such violations.
• The Bonded Labour System Abolition Ordinance of 1975 was enacted to abolish bonded labor, freeing laborers from obligations and extinguishing their bonded debts.

People's Union of Democratic Rights V. Union of India

• The court ruled that the Union of India, Delhi Administration, and Delhi Development Authority are responsible for ensuring contractors comply with labor laws.
• The Supreme Court interpreted "other similar forms of forced bonded labor" in Article 23 broadly, treating forced labor at below minimum wage due to economic compulsion similarly to bonded labor.
• Article 42 ensures just and humane working conditions, while Article 43 promotes living wages and decent working conditions for all workers.
• In the case of Public Union for Civil Liberties V. State of Tamil Nadu, the Supreme Court emphasized the need for rehabilitating bonded laborers, directing state governments and union territories to facilitate their rehabilitation.

Main Features of the Act

• The Act prohibits the bonded labor system.
• Any agreement or instrument requiring bonded labor becomes inoperative after the Act's commencement.
• Liability to repay bonded debt is extinguished.
• Property of bonded laborers is freed from encumbrances and restored to their possession.
• The Act provides for the constitution of vigilance committees in each district and sub-district for compliance.
• It aims to provide socio-economic justice to weaker sections of society.

Definitions

• Advance: An advance made by a creditor to a debtor, either in cash, kind, or a combination of both.
• Agreement: A contract between a debtor and creditor, which may include provisions for forced labor based on social custom.
• Bonded debt: An advance obtained by a bonded laborer under the bonded labor system.
• Bonded labor: Labor rendered under the bonded labor system.
• Bonded laborer: A laborer who incurs or is presumed to have incurred a bonded debt.
• Bonded labor system: A system of forced or partly forced labor where a debtor agrees to render labor or service to a creditor under specific conditions.

Sannasomannavara Somashekarappa V. Gorappa Rudraswamy

• Mr.Somashekarappa paid advances to the parents of four children in return for their service (grazing cattle) for a year. The children were provided with food and clothing.
• Later, the children, feeling scared, admitted to school. A case was filed under the Bonded Labour Abolition Act.
• The court found no creditor-debtor relationship between the parents and the employer. It was deemed child labor, not bonded labor.
• The parents were not compelled or obliged to send their children, and the requirement of section 2(g) was not met.

Abolition of Bonded Labour System

• Upon the commencement of the Act, the bonded labour system is abolished, and every bonded labourer is freed from any obligation to render bonded labour.
• After the commencement of the Act, no person shall make any advance under, or in pursuance of, the bonded labour system, nor compel any person to render bonded labour or other forms of forced labour.

The Agreement, Custom, etc., to be Void

• On the commencement of the Act, any custom, tradition, contract, agreement, or instrument requiring a person or their family member to work as a bonded labourer becomes void and inoperative.

Extinguishment of Liability to Repay Bonded Debt

• All bonded debts are considered extinguished.
• The obligation of a bonded labourer to repay any bonded debt, or the unsatisfied part of any bonded debt, is deemed extinguished upon the commencement of the Act.
• No suit or proceeding for the recovery of bonded debt shall lie after the commencement of the Act.
• Every decree or order for the recovery of bonded debt, passed before the commencement of the Act and not fully satisfied, is deemed fully satisfied.
• Attachments made for the recovery of bonded debt before the Act's commencement stand vacated.
• Property belonging to a bonded labourer, taken by a creditor for bonded debt recovery, shall be restored to the bonded labourer.
• If restoration of property is not made within thirty days, the aggrieved person may apply to the prescribed authority for restoration.
• Sales of attached property before the Act are not affected.
• Pendings suits for enforcement of obligations under the bonded labour system stand dismissed.
• Bonded labourers detained in civil prison are released upon the Act's commencement.

Property of Bonded Labourer to be Freed from Mortgage, etc.

• All property vested in a bonded labourer, which was under any mortgage, charge, lien, or other incumbrances in connection with any bonded debt immediately before the commencement of the Act, shall stand freed and discharged from such mortgage, charge, lien, or incumbrances.
• Where any such property was in the possession of the mortgagee or holder of the charge, lien, or incumbrance immediately before the commencement of the Act, such property shall be restored to the bonded labourer’s possession.
• If there is a delay in restoring any property to the bonded labourer’s possession, the labourer is entitled to recover mesne profits from the mortgagee or holder of the lien, charge, or incumbrance as determined by the civil court of the lowest pecuniary jurisdiction within the local limits where the property is situated.

Freed Bonded Labourer Not to be Evicted from Homestead, etc.

• No person freed and discharged under this Act from any obligation to render bonded labour shall be evicted from any homestead or other residential premises occupied immediately before the commencement of this Act as part of the consideration for bonded labour.
• If such a person is evicted by the creditor from any homestead or other residential premises after the commencement of this Act, the Executive Magistrate in charge of the Sub-Division where such homestead or premises is situated shall restore the bonded labourer to possession of such homestead or premises as early as practicable.

Creditor Not to Accept Payment Against Extinguished Debt

• No creditor shall accept any payment against any bonded debt which has been extinguished or deemed to have been extinguished or fully satisfied by virtue of the provisions of this Act.
• Whoever contravenes the provisions shall be punishable with imprisonment for a term which may extend to three years and also with fine.
• The court convicting any person, in addition to the penalties which may be imposed, direct the person to deposit the amount accepted, in the court, in the order for being refunded to the bonded labourer.

Implementing Authorities

Authorities for Implementation (Sec 10)

• The State Government can delegate powers and duties to a District Magistrate to ensure the effective implementation of this Act.
• The District Magistrate can designate an officer under his authority to exercise these powers and perform these duties within specified local limits.

Duty of District Magistrate and Officers (Sec 11)

• The District Magistrate and the designated officer should, as far as possible, promote the welfare of freed bonded labourers by securing and protecting their economic interests.
• The aim is to prevent these labourers from entering into new bonded debts.

Duty to Inquire (Sec 12)

• It is the responsibility of every District Magistrate and their designated officers to investigate whether any bonded labour system or forced labour is being enforced within their jurisdiction after the commencement of this Act.
• If such practices are found, immediate action must be taken to eliminate them.

Legal Cases Related to Bonded Labour

• Jai Singh v. State of Punjab: Family members forced to work under a loan obligation was ruled a violation of Article 23 and the Bonded Labour System (Abolition) Act, 1976. The District Magistrate was ordered to act under Section 12 of the Act.
• Badhua Mukti Morcha v. Union of India: A Public Interest Litigation led to court directives for improving living conditions of stone quarry workers in Faridabad. The court emphasized the right to live with dignity, linking it to various Articles of the Constitution.

Vigilance Committees (Sec 13)

• Each State Government is required to establish Vigilance Committees in every district and sub-division as deemed appropriate.
• The Vigilance Committee for a district includes:
  • The District Magistrate or a nominee as Chairman.
  • Three Scheduled Caste or Scheduled Tribe members nominated by the District Magistrate.
  • Two social workers from the district, nominated by the District Magistrate.
  • Up to three representatives from rural development agencies, nominated by the State Government.
  • One representative from financial and credit institutions, nominated by the District Magistrate.
• The Vigilance Committee for a sub-division consists of:
  • The Sub-Divisional Magistrate or a nominee as Chairman.
  • Three Scheduled Caste or Scheduled Tribe members nominated by the Sub-Divisional Magistrate.
  • Two social workers from the Sub-Division, nominated by the Sub-Divisional Magistrate.
  • Up to three representatives from rural development agencies, nominated by the District Magistrate.
  • One representative from financial and credit institutions, nominated by the Sub-Divisional Magistrate.
  • One officer specified under section 10 and functioning in the Sub-Division.

Functions of Vigilance Committee (Sec 14)

• The Vigilance Committee advises the District Magistrate on the implementation of the Act.
• It ensures the economic and social rehabilitation of freed bonded labourers.
• The Committee coordinates with rural banks and co-operative societies to ensure adequate credit for freed bonded labourers.
• It monitors offences under the Act and surveys potential offences.
• The Committee defends suits against freed bonded labourers or their families regarding bonded debts.
• When a debt is claimed as bonded, the creditor must prove it is not a bonded debt.

Punishments for Bonded Labour Offences

• Punishment for Compelling Bonded Labour:
• A person compelling someone to render bonded labour after the Act's commencement can face up to three years of imprisonment and a fine of up to two thousand rupees.
• Punishment for Advancing Bonded Debt:
• Advancing a bonded debt after the Act's commencement can lead to a similar punishment of imprisonment and fine.
• Punishment for Extracting Bonded Labour:
• Enforcing any custom or agreement requiring bonded labour can result in up to three years of imprisonment and a fine.
• Omission or Failure to Restore Property:
• The Act also punishes failure to restore property to bonded labourers.
• Abetment:
• Abetting any offence under the Act is punishable with the same penalty as the offence.
• Trial Jurisdiction:
• Offences under the Act can be tried by Executive Magistrates with powers of Judicial Magistrates.
• Civil Court Jurisdiction:
• Civil courts cannot intervene in matters under this Act, and no injunction can be granted regarding actions under it.

Neeraja Choudhary V. State of Madhya Pradesh

• The petitioner alleged that many labourers rescued from Faridabad quarries have not been rehabilitated despite the time elapsed.
• The court emphasized that identification, rescue, and rehabilitation of bonded labourers are essential as per Article 21 and 23 of the Constitution.
• Rehabilitation is crucial to prevent rescued labourers from falling back into poverty and substandard conditions, which could lead them back into bonded labour.

Recommendations of the Second National Commission on Labour

• The Bonded Labour System (Abolition) Act, 1976 is seen not as a labour law but as welfare legislation.
• Unlike other labour laws that involve an employer-employee relationship, this law focuses on rehabilitating individuals released from bondage.
• The implementation of this law by the Ministry of Labour is considered appropriate as it stems from Article 23 of the Constitution and addresses the needs of working people.
• Despite constitutional and legal efforts to abolish bonded labour, challenges in implementation persist at the administrative level.
• Identifying bonded labourers and rehabilitating them post-release are significant challenges.
• There is often administrative resistance to the proper implementation of beneficial legislation aimed at the welfare of the poor and downtrodden.