COIR BOARD, ERNAKULAM, COCHIN AND ANR. versus INDIRA DEVI P.S. AND ORS.

Citation: [1998] 2 S.C.R. 87 · Decided: 04-03-1998 · Supreme Court of India · Bench: SUJATA V. MANOHAR · Disposal: Dismissed
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Judgment (excerpt)

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. 
COIR BOARD,.ERNAKULAM; COCHIN AND ANR. 
A 
v. 
INDIRA DEVI P.S. AND ORS. 
MARCH 4, 1998 
[MRS. SUJATA V. MANOHAR AND D.P. WADHWA, JJ.] 
B 
Labour L.aws : 
Industrial Disputes Act, 1947-Section 2(j), (g) and (s) and Chapter 
V-A-Definition of "industry"-Scope-Coir Board-Whether covered by the 
definition- Termination of services of its employees-Whether attracts the C 
provision of Chapter V-A of the Act-Correctness of the test laid down in 
Bangalore Water Supply and Sewage Board to determine the concept of 
"industry" doubted-Damaging effect of extended meaning given to the 
definition of word "industry" ·in Banga!Ore Water Supply and Sewage Board, 
pointed out-Hence, matter referred to larger Bench to reconsider the decision D 
of Bangalore Water Supply and Sewage Board-Need to frame a proper law 
to promote the welfare of labour, emphasised-Coir Industry Act, 1953, 
Section I 0, Preamble & Statement of Objects and Reasons. 
The Coir Board as established under the Coir Industry Act had employed 
certain clerks and typists who were discharged. They claimed that their 
services could only be terminated in accordance with the provisions of the E 
Industrial Disputes Act. A full Bench of the Kerala High Court came to the 
conclusion, inter alia, that Coir Board was an "industry" as defined under 
the Industrial Disputes Act and termination of services of its employees 
would attract Chapter V-A of the Act. Hence this appeal by the Coir Board. 
Referring the question to larger Bench, this Court. 
HELD: I. Looking to the uncertainly left low case by on the question F 
of activities and organisations that can be termed as industries under the 
Industrial Disputes Act and in the light of experience of the last two deceased 
in applying the test laid down in the case of Bangalore Water.Supply and 
Sewage B(Jm-d it is necessary that the decision in the said case is re-
examined. Instead ofleading to industrial peace and welfare of the community G 
(which was the avowed purpose of artificially extending the definition of 
industry), the application of the Act to organisations which were, quite 
possibly, not intended to be so covered by the machinery set up under the said 
Act, might have done more damage than good, not merely to the organisations 
but also to employees by the curtailment of employment opportunities. 
[48-G-HJ H 
87 
88 
SUPREME COURT REPORTS 
[1998] 2 S.C.R. 
A 
Bangalore Water Supply and Sewage Board v. A. Rajjapa, (1978( 2 
SCC 213; D.N. Baneriee v. P.R. Mukherjee, AIR (1953) SC 58; Corporation 
of the City of Nagpur v. Employees, (19601 2 SCR 942; State of Bombay v. 
Hospital Mazdoor Sabha, AIR (1960) SC 610; Workman v. Indian Standard 
Institute, AIR (1976) SC 145; National Union of Commercial Employees v. 
MR. Mehar Industrial Tribunal, AIR (1962) SC 1080; University of Delhi 
B v. Ram Nath, (1963) 2 LLJ 335; The Secretary, Madras Gymkhana Club 
Employees' Union v. The Management of the Gymkhana Club, AIR (1968) 
SC 554; Cricket Club of India v. Bombay Labour Union & Anr., AIR (1969) 
SC 276; The Management of Safderjung Hospital v. Ku/dip Singh Sethi, AIR 
(1970) SC 1407; Physical Research Laboratory v. K.G. Sharma, (1997] 4 
C SCC 257; Sub-Divisional Inspector of Post v. Theyyam Jiseph, (1996] 8 SCC 
489; Bombay Telephone Canteen Employees' Association v. Union of India, 
(1997] 6 SCC 723 and G.M Telecom v. Srinivas Rao, (1997] 8 SCC 767, 
referred to. 
2. Undoubtedly, it is of paramount importance that a proper law is 
D framed to promote the welfare of labour employed in industries. It is equally 
important that the welfare of labour employed in other kinds of orgainsation 
is also promoted and protected. But the kind of measures which may be 
required for the latter may be different, and may have to be tailored to suit 
the nature of such organisations, their infrastructure and their financial 
capacity as also the needs of their employees. (99-B] 
E 
3. The elimination of profit motive or a desire to generate income as 
the purpose of industrial activity has led to a large number of philanthropic 
and charitable activities being affected by the Act. This has led to cessation 
of many welfare activities previously undertaken by such organisation which 
has deprived the general community of considerable benefit and the employees 
F of their livelihood. There are many activities which are undertaken not with 
a view to secure any monetary returns (whether one refers it as livelihood, 
income or
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