Primary sector is more prone to underemployment because sufficient jobs are not generated in tertiary and secondary sector so people are forced to turn towards agriculture. Even if you remove some people from this sector, this sector would not be affected.
It is present in both rural and urban areas. In rural areas, disguised unemployment is present in the agricultural sector. Owing to the family structure in India, several members of the same family may be working on the same piece of land for agricultural production. They are engaged in an activity which can be carried out by a lesser number of people as rural land holdings in India are notoriously small. Thus, they are not employed to their full potential and contributing to disguised unemployment.