STATE OF RAJASTHAN versus GANESHI LAL

Citation: [2007] 12 S.C.R. 1197 · Decided: 10-12-2007 · Supreme Court of India · Bench: ARIJIT PASAYAT · Disposal: Case Partly allowed

Judgment (excerpt)

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STATE OF RAJASTHAN 
A 
v. 
GANESHILAL 
DECEMBER I 0, 2007 
B 
[DR. ARIJIT P ASA YAT AND P. SATHASIV AM, JJ.] 
Industrial Disputes Act, 1947-s. 2(s)-Termination of employee 
of Law department of State Government-Industrial dispute raised-
Resisted on the ground that the department is not an 'industry'- C 
Courts below giving relief to workman holding it to be 'industry'-
On_ appeal, held: Law department is not an 'industry '-However, since 
the employee had been reinstated, it is left to the department to 
consider continuance of the employee. 
Judgment-Precedential value of-Applicability-Held: Reliance 
on a judgment sans its factual background is impermissible-A 
judgment is a precedent on its own facts-Only the ratio has the binding 
effect and not every observation-Observations of courts should not 
be read as a statute-Precedent. 
D 
E 
Respondent was employed as a peon by Law Department of 
the appellant State as a temporary employee on contract basis. His 
services were terminated. He raised an industrial dispute alleging 
that the termination was in violation of Section 25-G of Industrial 
Disputes Act, 1947. The claim was resisted on the ground that Law F 
Department of the State Government was not an 'industry'. Labour 
Court held that Law Department was an 'industry' in view of the 
judgments of the Supreme Court holding various departments, hotel, 
Public Works Departments, Irrigation Department as an 'industry'. 
The view was upheld by Single Judge as well as Division Bench of G 
High Court. Hence the present appeal. 
Partly allowing the appeal, the Court 
HELD: 1. The Law Department of the State Government 
1197 
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1198 
SUPREME COURT REPORTS 
[2007] 12 S.C.R. 
A cannot be considered as an 'industry'. The accepted concept of an 
industry cannot be applied to the Law department of the Government. 
The la hour Court and the High Court have not even indicated as to 
how the Law Department is an industry. However, it appears that 
the respondent has been reinstated to the post he was holding at the 
B time of termination. In view of this fact, even though it has been held 
that the orders passed by the courts below are clearly unsustainable, 
it is left to the appellant to consider wh~ther the respondent can be 
continued, in view of the fact that he worked for some years. 
[Paras 8, 10, 16 and 17) [1201-A, B; 1203-E-F] 
c 
2.1. Reliance by a court on a decision without looking into the 
factual background of the case before it is clearly impermissible. A 
decision is a precedent on its own facts. Each case presents its own 
features. Circumstantial flexibility, one additional or different fact 
may make a world of difference between conclusions in two cases. 
D Disposal of cases by blindly placing reliance on a decision is not 
proper. [Paras 11and14] (1201-C,D; 1203-A) 
2.2. A decision is an authority for what it actually decid~s. What 
is of the essence in a decision is its ratio and not every observation 
E found therein nor what logically flows from the various observations 
made in the judgment. The enunciation of the reason or principle on 
which a question before a Court has been decided is alone binding 
as a precedent. It is not everything said by a Judge while giving a 
judgment that constitutes a precedent. The only thing in a Judge's 
F decision binding a party is the principle upon which the case is 
decided and for this reason it is important to analyse a decision and 
isolate from it the ratio decidendi. A case is a precedent and binding 
for what it explicitly decides and no more. Judgments of Courts are 
not to be construed as statutes. The words used by Judges in their 
G judgments are not to be read as if they are words in an Act of 
Parliament. To interpret words, phrases and provisions of a statute, 
it may become necessary for judges to embark into lengthy 
discussions but the discussion is meant to explain and not to define. 
Judges interpret statutes, they do not interpret judgments. They 
H interpret words of statutes; their words are not to be interpreted as 
, 
ST ATE v. GANESH! LAL [PASA Y AT, J.] 
1199 
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statutes. Observations of Courts are neither to be read as Euclid's A 
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theorems nor as provisions of the statute and that too taken out of 
their""context. These observations must be read in the context in which 
they appear to have been stated. 
[Paras 11and12) [1201-D, E, F, G; 1202-B, C, DJ 
State of Orissa v. Sudhansu Sekhar Misra and Ors., AIR (1968) B 

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