Bonded Labor System (Abolition) Act, 1976

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Under Article 23 of The Constitution of India, Prohibition is imposed on the practice of Traffic in Human Being and of Forced Labor. It also provides that contravention of said prohibition is an offense under law. The practice of bonded labor 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.