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(e) In response to the protest by the Respondent/Claimant against the deductions, the Appellant/DMRC vide letter dated 28th August, 2007 conveyed to the Respondent/Claimant that the deductions were made in view of the statutory provisions of the Building and Other Construction Workers‟ Welfare Cess Act, 1996 (hereinafter referred to as the „Cess Act‟) read with the Building and Other Construction Workers‟ Welfare Cess Rules, 1998 (hereinafter referred to as the „Cess Rules‟) and the Building and Other Construction Workers‟ (Regulation of Employment and Conditions of Service) Act, 1996 (hereinafter referred to as the „BOCW Act‟), which provide for deduction to be made at 1% of the gross amount of work done.

24. Building and Other Construction Workers' Welfare Fund and its application.- (1) There shall be constituted by a Board a fund to be called the Building and Other Construction Workers' Welfare Fund and there shall be credited thereto-

(a) any grants and loans made to the Board by the Central Government under section 23;

                    (b)   all   contributions       made     by        the
                          beneficiaries;
                    (c)   all sums received by the Board from
                          such other sources as may be decided
                          by the Central Government.
           (2)      The Fund shall be applied for meeting-
                    (a)   expenses     of    the     Board       in    the
                          discharge    of    its    functions     under
                          Section 22; and


                       (b)    salaries,    allowances       and    other
                             remuneration       of   the     members,
                             officers and other employees of the
                             Board;
                      (c)    expenses on objects and for purposes
                             authorised by this Act.

"NOTIFICATION New Delhi, the 26th September, 199 S.O.2899 - In exercise of powers conferred by sub- section (1) of section 3 of the Building and Other Construction Workers‟ Welfare Cess Act, 1996 (28 of 1996) and in supersession of the notification of the Government of India in the Ministry of Labour No. S.O. 1767 dated the 17th May, 1996 the Central Government specifies a cess for the purposes of the Building and Other Construction Workers (Regulation of Employment and Other Conditions of Service) Act, 1996 (27 of 1996) at the rate of 1 per cent, of the cost of construction incurred by an employer."

(c) It is further stipulated that the cess levied would be collected from every employer including deductions at source in relation to a building or other construction work of a Government or of a public sector undertaking. The Act permitted the Central Government to make rules for carrying out provisions of the Cess Act.

(d) The BOCW Act was an Act to regulate the employment and conditions of service of building and other construction workers and to provide for the safety, health and welfare measures and for other matters connected therewith or incidental thereto. The BOCW Act came into force throughout India on the 1st day of March, 1996. Under this Act a contractor was defined as a person who inter alia undertook the employment of building workers or supplied building workers for any work and included a sub-contractor. The Act further defined an employer as including the contractor in relation to a building or other construction work carried on by or through a contractor or by the employment of building workers supplied by a contractor. The Act further provided that every State Government may by notification appoint and constitute a board known as the Welfare Board to exercise the powers conferred on it. The Board was in turn to constitute a fund to be called the Building and Other Construction Workers Welfare Fund which was to receive inter alia all sums from such other sources as may be decided by the Central Government.