LexBANGALORE WATER-SUPPLY & SEWERAGE BOARD, ETC versus R. RAJAPPA & OTHERS
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' - ,> 207 .UANGALORE WATER-SUPPLY & SEWERAGE BOARD, ETC. A v. R. RAJAPPA & OTHERS February 21, 1978 & April 7, 1978 * ,fM. H. BEG, C.J., Y. V. CHANDRACHUD, P. N. BHAGWATI, V. R. KRISHNA IYER, JASWANT SINGH, v. D. TULZAPURKAR AND D. A. DESAI, JJ .] "INDUSTRY" Industry in Section 2(j) of the Industrial Disputes Act, 1941-Triple test to be applied and the doniinant nature test-Whether the statutory Body performing what is in essence regal functions by providing the basic amenties 'to the citizens is outside the scope of the definition~ 'fhe Tespondent employees were fined by the Appellant Board for miscon- duct and various sums were recovered from them. Therefore, they filed a Claims Application No. 5 /72 under Section 33C (2) of tho Industrial Disputes Act, . alleging that the said punishment was imposed in violation of the principles of natural justice. The appellant Board raised a preliminary objection before the Labour Court that the Board, a statutory body performing \vhat is in esseilce a regal function by providing the basic amenities to the citizens, is not an industry within the meaning of the expression under section 2(j) of the Industrial Disputes Act and consequently the employees were not workmen and the Labour Court had no jurisdiction to decide the claim, of the work- men. This cbjection being over-ruled, the appellant Board filed two Writ Petitions viz. Nos. 868 and 2439 of 1973 before the •Kamataka High Court at Bangalore. The Division Bench of that High Court dismissed the petitions and held that the appellant Board is "industry" within the meaning of the expression under section 2(j) of the Industrial Disputes Act, 1947. The appeals by Special Leave, considering "the chances of confusion from the crop of cases in an area where the common man has to understand and apply the law and the desirability that there should be 1 t}: comprehensive, clear and conclu- ~ive declaration as to what is an industry under the Industrial Disputes Act as it stands'' ~·-ere placed for consideration by a larger Bench. HELD : Per M. H. Beg, C.J. (concurring with Bhag,vati, Krishna Iyer and Desai, JJ.) 1. The term "analogous to the trade or business" could not cut down the ·~cope of the term "industry". The said words can reasonably mean only acti- vity which results in goods made and manufactured or service rendered which -are capable of being converted into saleable ones. They must be capable of entering the \vorld of "res comniercium", although they may be kept out of the market for some reason. It is not the motive of an activity in making goods or running a service but the possibility of making them marketable if one who makes goods or renders service so desires, that should determine ·whether the activity lies within the domain or circle of industry. But eveii thls may not be always a satisfactory test. By this test the type o[ services which ·are rendered purely for the satisfaction of spiritual or psychological urges of per- sons rendering those services would be excluded. Wilenever an industrial dispute \vould arise between either employers and their wo1kmen or between w·orkmen and \Vorkmen, it should be considered an area whhin the sphere of ~'industry" but not otherwise. In other words, the nature of the nctivity \Vlll (•be dctermin~d by the conditions W'hich give rise to the likelihood of the occur- . rence of such disputes and their actual occurrence in the sphere. [220D, G, 221A-B] *Judgn1ents published in the order and date as delivered. B c D E F G H A B c D 208 SUPREME COURT REPORTS [1978] 3 S.C.R· "D. N. Banerje'.s case [1953] SCR 302; -Corporation vf City of Nagpur v. Its Employees [1960] 2 SCR 942; State of Bombay and Otherr v. The Hospital Mazdoor Sabha and Others [1960] 2 SCR 866 referred to and followed. 3. The term "sovereign should be reserved technically and more correctly for the sphere of ultimate decisions. Sovereignty operates on ai sovereign pfane of its own. Only those services which are governed by separate rules _ and constitutional provisions such as Articles 310 and 311 should, strictly speaking be excluded fron1 the sphere of industry by a necessary in1plication. [221E, GI H. If. Kcsva!landa Bharati Sripathagalavaru v. State of Kera/a [1973] Supple· -,; mental S.C.R. Pa.ge-1 referred to. 4. The special excludes the applicability of the general. Certain public utility services which are ca
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