Section 4

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Debt bondage

This provision abolished the bonded labour system, releasing all existing bonded workers and forbidding any future imposition of debt bondage.

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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.

Law / India / Bonded Labour System (Abolition) Act, 1976

The Bonded Labour System (Abolition) Act, 1976 provides for the abolition of the bonded labour system, with a view to preventing the exploitation of vulnerable sections of society.

This Act prohibits, criminalises and extinguishes any system of debt bondage, whether by agreement, custom or contract. The Act aims to achieve the following: (i) every bonded labourer is discharged from any obligation to provide such labour; (ii) the obligation to repay any bonded debt is extinguished; (iii) the property of bonded labourers shall be free of mortgage, charge, lien or other encumbrances and shall be restored to his possession; (iv) a bonded labourer shall not be evicted from a homestead or other residential premise he was occupying as part of the consideration for the bonded labour; and (v) no creditor may accept payment against an extinguished debt.

Indian courts have given a very broad, expansive interpretation to the definition of bonded labour. For example, where a person has provided labour or services to another and received a remuneration below the minimum wage, the Courts have ruled that the labour or service falls clearly within the scope of the prohibition of forced labour under the constitution.