Gujarat High Court
Shri Mahila Griha Udyog Lijjat Papad vs Arunaben Arvindbhai Chaudhary on 12 February, 2020
Author: Sonia Gokani
Bench: Sonia Gokani
C/SCA/19618/2019 JUDGMENT
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/SPECIAL CIVIL APPLICATION NO. 19618 of 2019
With
R/SPECIAL CIVIL APPLICATION NO. 21885 of 2019
FOR APPROVAL AND SIGNATURE:
HONOURABLE MS JUSTICE SONIA GOKANI
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1 Whether Reporters of Local Papers may be allowed to YES
see the judgment ?
2 To be referred to the Reporter or not ? YES
3 Whether their Lordships wish to see the fair copy of the NO
judgment ?
4 Whether this case involves a substantial question of law NO
as to the interpretation of the Constitution of India or any
order made thereunder ?
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SHRI MAHILA GRIHA UDYOG LIJJAT PAPAD
Versus
ARUNABEN ARVINDBHAI CHAUDHARY & 1 other(s)
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Appearance:
MR NV GANDHI(1693) for the Petitioner(s) No. 1
MR NIKUNJ KANARA, Assistant Government Pleader for the Respondent(s) No. 1,2
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CORAM: HONOURABLE MS JUSTICE SONIA GOKANI
Date : 12/02/2020
COMMON ORAL ORDER
1. These petitions since involve identical questions of law and facts, they are being decided by this common order where the facts are drawn from Special Civil Application No.19618 of 2019 for the purpose of adjudication.
2. The petitioner is registered under the provisions of Bombay Public Trust Act, 1950 at Sr.No.F1460 (Bombay) on dated 19.12.1966. It has approached this Court through its President invoking extra ordinary jurisdiction of this Page 1 of 62 Downloaded on : Sun Jun 14 04:15:30 IST 2020 C/SCA/19618/2019 JUDGMENT Court while challenging the judgment and award of Presiding Officer, Labour Court, Surat passed in Reference (T) No.52 of 2006, dated 06.07.2019, whereby the said Reference was allowed in part, essentially on the ground that there is no relationship of employer and workmen between the parties and the provisions of Industrial Disputes Act, 1947 ('the I.D.Act' hereinafter) will have no applicability.
3. The facts bereft of details are as follow:
3.1 The petitioner Shri Mahila Griha Udyog Lijjat Papad (Recognized by Khadi & Village Industries Commission, ('the KVIC' hereinafter)), is a Trust registered under the provisions of the Bombay Public Trust Act, 1950. It is an Indian women's cooperative involved in manufacturing of various fast moving consumer goods. The main objective of the organization as pleaded before this Court is the empowerment of women by providing them employment opportunities. It was started in the year 1959 by seven Gujarati women in Mumbai with Page 2 of 62 Downloaded on : Sun Jun 14 04:15:30 IST 2020 C/SCA/19618/2019 JUDGMENT capital of Rs.80/ and in the year 2018 it had an annual turnover of more than Rs.800/ Crore. As on date, it has 43,000 women members across the country and is considered one of the most remarkable entrepreneurship initiated by women.
The organization was named initially "Shri Mahila Griha Udyog Lijjat Papad", however, in the year 1966 "Lijjat" was registered itself as a society under the Societies Registration Act, 1860. In September, 1966, the KVIC recognized "Lijjat" as a unit belonging to the industrial group processing cereals and pulses under the Khadi and Village Industries Act. It has been recognized as a "Village Industry" and it has been granted a working capital of 0.8 million with certain tax exemptions. With its tremendous success with papads, "Lijjat" began producing other products like Khakhra, Masala Vadi, Wheat Flour and bakery products. It has setup its flour mills, printing division and polypropylene packing division. Various awards it has at its credit and it believes in the philosophy of Page 3 of 62 Downloaded on : Sun Jun 14 04:15:30 IST 2020 C/SCA/19618/2019 JUDGMENT sarvodaya and collective ownership. The members are coowners and referred to as "sisters". All decisions are based on consensus and any member has the right to veto a decision. There are 21 members of managing committee entrusted to run the organization and "Sanchalikas"
(Administrator) are the incharge of various branches and divisions of the office. They are chosen from among the memberssister on the basis of consensus every three years and the committee of eleven memberssister again is chosen by consensus. The central office at Mumbai coordinated with the activities of various branches, however, as the organization grew, the authority was decentralized in terms of work and sharing of profits at the branch level. Although, Managing Committee's approval is required by "Sanchalikas" before they undertake any new project or activity. All the branches follow the same set of instructions and have similar accounting system. Annual General Meeting is attended by the membersisters representing Page 4 of 62 Downloaded on : Sun Jun 14 04:15:30 IST 2020 C/SCA/19618/2019 JUDGMENT branches and division from all over India. 3.2 According to the petitioner, there is no credit method for running operations in the organization. Every payment is done on a daily basis, except for the outside supply of raw material. Profits and losses are shared equally amongst the members of a given branch. In the initial days of the "Lijjat" profits of the first six months were shared equally among all sisters in the form of Gold. Now, the decision whether to share the profits in gold or in cash is made at the branch level. The cost of nationallevel advertising is borne by all branches and division, depending on their individual production abilities. To any inconsistency and the quality of the papad the final product is always tested in the Lijjat's laboratory in Mumbai. The central office purchases and distributes all ingredients to maintain the quality of the final product. The surprise visits to various branches were made on a regular basis Page 5 of 62 Downloaded on : Sun Jun 14 04:15:30 IST 2020 C/SCA/19618/2019 JUDGMENT to assure that the production conditions are hygienic. For the purpose of better administration and management of the petitioner Trust, the Assistant Charity Commissioner, State of Maharashtra at Mumbai exercised his suomotu powers as provided under Section 50 A (1) of the Bombay Public Trust Act, 1950 to frame the scheme.
3.3 In this backdrop, the dispute raised by the respondent working on a temporary basis at village Galon, Valod Branch requires consideration. She was acting against the interest of the Trust according to the petitioner on account of her irregularities and therefore, the petitioner stopped to hire her for such temporary work.
3.4 Aggrieved respondent preferred the Reference before the Presiding Officer of Labour Court, Surat where she prayed for the reinstatement with back wages on account of her alleged termination on 10.10.2005 alleging the Page 6 of 62 Downloaded on : Sun Jun 14 04:15:30 IST 2020 C/SCA/19618/2019 JUDGMENT breach under Sections 25(F) , 25(G) and 25(H) of the I.D.Act.
4. After the statement of claim, the written statement was filed. On issuance of the notice, the petitioner denied the contentions raised in the statement of claim and had maintained that the Labour Court, Surat would have no jurisdiction and nor powers to adjudicate the dispute in absence of any relationship of 'employer and the workmen' between the parties. It also maintained a public charitable trust cannot be regarded as an 'industry' with the meaning of Section 2 (J) of the I.D.Act. The Clause 5 of the Scheme of the Trust also has been relied upon to urge that the beneficiaries of the society shall be the members of the society and all such members shall be deemed to be the owners of the society and not its labourers.
5. The evidence when was adduced, she agreed that no written order of appointment was given and she was paid the wages on day to day basis. Page 7 of 62 Downloaded on : Sun Jun 14 04:15:30 IST 2020
C/SCA/19618/2019 JUDGMENT The deposition of "Sanchalika" Ramaben and
members of Executing Committee of Valod Branch also came on record. They all have deposed that the respondent since was acting against the interest of the petitioner Trust, the Trust has stopped to hire her services.
6. The Court on the strength of the evidence oral as well as documentary and the statements made by the respective parties, treated the first respondent as an employee of the petitionerTrust and passed judgment and award dated 06.07.2019. It directed to pay lumpsum wages to the sum or Rs.25,000/ along with the cost of Rs.3,000/.
7. Aggrieved petitioners are before this Court raising legal as well as factual disputes questioning the judgment and award.
8. At the time of admission, the Court had requested the learned Assistant Government Pleader to assist the cause by addressing the court on this issue and therefore, the learned Page 8 of 62 Downloaded on : Sun Jun 14 04:15:30 IST 2020 C/SCA/19618/2019 JUDGMENT advocate, Mr.N.V.Gandhi for the petitioner had been heard extensively and learned Assistant Government Pleader, Mr.Nikunj Kanara for the State at the request of the Court has also made his detailed submissions.
9. According to the learned advocate, Mr.N.V.Gandhi, the petitioner being the Trust, the jurisdiction of the Labour Court has been exercised wrongly and erroneously as the Court has not acted within its bound. There is a requirement of exercise of powers of superintendence under Article 227 of the Constitution of India. He has further urged that there is no relationship of employer and workmen as provided under the I.D.Act. Moreover, the petitioner does not fall into the definition of the "Industry" under Section 2 (J) of the I.D.Act. By giving the details of the scheme, which has been framed and the entire structure of the organization which operated from 1959, it has been urged to this Court that in no manner it can Page 9 of 62 Downloaded on : Sun Jun 14 04:15:30 IST 2020 C/SCA/19618/2019 JUDGMENT be stated that the petitioner organization is an employer.
9.1 He has maintained that the respondent was a cosharer and a coowner. If at all she had any dispute with the petitioner organization, she could have chosen to approach the Civil Court as the profit earned by the organization is shared by all the members, who cannot be reduced to the position of the workmen. The organization which had initiated its work with a laudable objective of the women empowerment, according to him, started by seven women at Mumbai, now, has 43,000 women members across the country. Terming this as the relationship of the employer and the workmen would amount to changing the very objective of initiating the very organization. This will also cause difficulty in the entrepreneurial initiative taken by the women, which had then been supported by the KVIC considering the remarkable success this initiative had achieved. He further emphasized on various clauses of the Page 10 of 62 Downloaded on : Sun Jun 14 04:15:30 IST 2020 C/SCA/19618/2019 JUDGMENT scheme to urge that the beneficiaries of the society are the members, who are deemed to be owners of the society and not just labourers as they all share the profit and loss of the society. He also urged further that the scheme provides for the membership, cancellation of membership and also provides for the rights of the members. The members are found entitled to receive from society such amount in proportion to papad rolled out by them and other product manufactured by them or commensurate with work put in by them.
9.2 Although, he agreed that the committee from time to time fixes and determines the bases for making such payment either in cash or in kind and on obtaining the approval of the members at Annual General Meeting, such payment is being made. However, the members who ceases to be the members of the society, can have no claim or right of any nature against the society except the recovery of the amount due to her for the Page 11 of 62 Downloaded on : Sun Jun 14 04:15:30 IST 2020 C/SCA/19618/2019 JUDGMENT work put in by her for the society.
9.3 Reliance is placed on the (1997) 2 GLH 48 where the Court held that the object and intent of enacting Section 50 (A) of the Bombay Public Trust Act is to provide alternative forum for framing scheme for the administration of the Trust. The power to frame the scheme does not lie with either the Civil Court or the Charity Commissioner. The Court also has held that while interpreting the scheme, it should be in the manner that advances the purpose of the act in preference over and interpretation which render the provision absurd and unworkable. In the given set of facts and circumstances. Interpretation made by the Labour Court will have no applicability and therefore, requires no further dilation.
9.4 He has also relied on the decision of JANAKBHAI JASHUBHAI PATEL VS. PARSHURAMDASJI GURU KAPILESHVARDASJI it was the First Appeal under Page 12 of 62 Downloaded on : Sun Jun 14 04:15:30 IST 2020 C/SCA/19618/2019 JUDGMENT Section 72(4) of the Bombay Public Trust Act, the appellant had preferred an application under Section 50 A before the Charity Commissioner, State of Gujarat, which came to be allowed. The Court held that the powers conferred under the Act under special contingency shall be exercised when it is necessary and expedient to frame the scheme in the interest of public Trust. The respondent was held to be PoojaricumManagercum Trustee he was disturbed as he would not be in a position to enjoy the offering of the temple once the scheme is framed. The trial Court had remitted the matter to the Charity Commissioner for the purpose of giving an opportunity of hearing to the respondent. This Court quashed and set aside the order passed by the trial Court and affirmed the order passed by the Charity Commissioner. This has been pressed into service essentially because the Charity Commissioner, Mumbai by a suomotu petition has framed a scheme and relying on the scheme and the objective which is urged before this Court that the Court cannot Page 13 of 62 Downloaded on : Sun Jun 14 04:15:30 IST 2020 C/SCA/19618/2019 JUDGMENT disregard this factum of the framing of the scheme and the purpose for which the suomotu, the whole initiative taken by the concerned authority. This also has been dealt with in the decision of Bombay High Court and even otherwise from the entirety of the facts and circumstances, the petitioner organization is held to be an industry and it satisfied the ambit and amplitude deliberately discussed in the decision of the BANGALORE WATER SUPPLY & SEWERAGE BOARD (SUPRA) and other decisions. This will have also no applicability in the instance case.
10. Per contra, learned Assistant Government Pleader has urged that there is no requirement for the Court to interfere essentially because the trial Court has taken into consideration in detailed the definition of industry and has also regarded the decision of BANGALORE WATER SUPPLY & SEWERAGE BOARD VS. A RAJAPPA AND OTHERS, reported in 1978 SC 215 where the Court has held that if a business is run for production or supply for Page 14 of 62 Downloaded on : Sun Jun 14 04:15:30 IST 2020 C/SCA/19618/2019 JUDGMENT goods in service with an eye on the profit, it is plainly an industry, even if, the whole on the substantial part of the profit so earned is diverted for purely charitable purpose, then also, the nature would not be affected. It remains essentially the economic activity, which involves the cooperation of employer and employee and would result into the production of goods in service. He has also relied on the decision rendered in case of the very petitioner by the Bombay High Court in case of SHRI MAHILA GRIHA UDYOG VS. RATNAMALA D.KOKEN where Court examined at length the various decisions determining the relationship of the employer and employee and has held that the activity being carried out by the petitioner in preparation of "papad" is definitely as industry and can be covered under the provision of Section 2 (J) of the I.D.Act. The contention of the respondent being the member of the petitioner society and therefore, is not the workman within the meaning of Section 2 (S) Page 15 of 62 Downloaded on : Sun Jun 14 04:15:30 IST 2020 C/SCA/19618/2019 JUDGMENT of the I.D.Act also has been according to the learned Assistant Government Pleader, dealt with extensively by the Court in the very decision. He, therefore, has urged that there is no jurisdictional error nor has the Court acted outside its bound and hence, the superintending power under Article 227 of the Constitution of India need not be exercised.
11.1 Learned Assistant Government Pleader has relied on the decision rendered in Special Civil Application No.10346 of 2006, where this Court has relied on the decision of the Bombay High Court which had examined the scope of its inquiry in the very nature of dispute and also examined as to whether the activities of the Trust could be defined as an industry.
11.2 Relevant findings and observations profitably are as follow:
"12. In the present case, no doubt the petitioner establishment is a Trust registered under the provision of Bombay Public Trust Act and is essentially catering and Page 16 of 62 Downloaded on : Sun Jun 14 04:15:30 IST 2020 C/SCA/19618/2019 JUDGMENT nourishing the need of persons suffering from Leprosy. For time being it can also be assumed that Trust is not essentially set up for profiteering and the income generated by the activity is being utilized for the persons suffering from this kind of disease, but fact remains that the circumstance under which the respondent is dealt with is also requires consideration. Few facts which are emerging from the record indicates that the petitioner establishment is engaged in a systematic activity, and its also engaged in various kinds of activities viz., Shoe making, Agarbatti making and other incidental material being made out by the persons, who are engaged in it. It appears from the set up for the petitioner establishment that for the purpose of training the persons, who are suffering from this ailment of Leprosy, some staff is engaged by the petitioner to train them and the document in the form of staff list produced on record of the case at Exh.16/16 indicates that respondent name is figuring at serial no.5, for the purpose of establishing that respondent was not merely engaged as a trainee. No iota of evidence is produced by the petitioner establishment as against to indicate that no staff in the form of employees are engaged. No material is produced by the petitioner even the witness of petitioner establishment has not thrown any light to indicate contrary to what has been stated by the respondentworkman. Looking to this systematic activity which is being conducted in a regular Page 17 of 62 Downloaded on : Sun Jun 14 04:15:30 IST 2020 C/SCA/19618/2019 JUDGMENT manner is establishing that the petitioner establishment is rightly understood by the learned Presiding Officer as an industry, as held by series of decision only no profit element is not sufficient enough to oust the establishment from the purview of definition of industry defined under Section 2 (J) of the Act. An attempt is made by the learned counsel for the petitioner relying upon a decision of in case of Bangalore Water Supply and Sewage Board (supra) and contended that the petitioner establishment is not to be construed as an industrial undertaking, but an establishment having a philanthropic devotion with sole object of charity to the society. Learned counsel has drawn the attention to paragraph 132 of the said decision and contended that, in no case the petitioner establishment can be set to be an industry. The predominant character of the institute and the nature of relation deserves to be looked into and the straight way earning employees do not shape up soul of institution to industry. To deal with such contention, the very next paragraph of the said decision also worth to be taken note of, and therefore, the same is reproduced hereinafter :
"133. It now remains to make a brief survey of the precedents on the point. One case which is germane to the issue is Bombay Panjrapole, (1972) 1SCR 202: (AIR 1971 SC 2422). A bench of this Court considered the earlier Page 18 of 62 Downloaded on : Sun Jun 14 04:15:30 IST 2020 C/SCA/19618/2019 JUDGMENT caselaw, including the decisions of the High Courts bearing on humane activities for the benefit of sick animals. Let there be no doubt that kindness to our dumb brethern, especially invalids, springs from the highest motives of fellow feeling. In the land of the Buddha and Gandhi no one dare argue to the contrary.
So, let there be no mistaking our compassionate attitude to suffering creatures. It is laudable and institutions dedicated to amelioration of conditions of animals deserve encouragement from the State and affluent philanthropists. But these considerations have no bearing on the crucial factors which invoke the application of the definition in the Act as already set out elaborately by us. "The manner in which the activity in question is organised or arranged, the condition of the cooperation between the employer and the employee necessary for its success and its object to render material service to the community" is a pivotal factor in the activityoriented test of an 'industry'. The compassionate motive and the charitable inspiration are noble but extraneous. Indeed, medical relief for human beings made available free by regular hospitals, run by Government or philanthropists, employing doctors and supportive staff and businesslike terms, may not qualify for exemption from industry. Service to animals cannot be on a higher footing than service to humans. Nor is it possible to contend that love of animals is religious or Page 19 of 62 Downloaded on : Sun Jun 14 04:15:30 IST 2020 C/SCA/19618/2019 JUDGMENT spiritual any more than love of humanbeings is.
Therefore, without going into the dairying aspects, income and expenditure and other features of Bombay Panjrapole, one may hold that the institution is an industry. After all, the employees are engaged on ordinary economic terms and with conditions of service as in other business institutions and the activities also have organisational comparability to other profitmaking dairies or Panjrapoles. What is different is the charitable object. What is common is the nature of the employer employee relations. The conclusion, nothwithstanding the humanitarian overtones, is that such organisations are also industries. Of course, in Bombay Panjrapole the same conclusion was reached but on different and, to some extent faulty reasoning. For the assumption in the judgment of Mitter J: is that if the income were mostly from donations and the treatment of animals were free, perhaps such charity, be it a hospital for humans or animals, may not be an industry. We agree with the holding, not because Panjrapoles have commercial motives but because, despite compassionate objectives, they share businesslike orientation and operation. In this view, Section 2(j) applies.
13. Even in this very judgment, few paragraphs are also to be taken into consideration to arrive at the fact Page 20 of 62 Downloaded on : Sun Jun 14 04:15:30 IST 2020 C/SCA/19618/2019 JUDGMENT whether petitioner establishment is coming within the purview of industry or not? The relevant extract of the said judgment is reproduced hereinafter:
"Whether there is:
(I) systematic activity,
(ii)Organised by cooperation between employer and employee (the direct and substantial element is chimerical), and (If it is not convenient to either side to conduct the matter on the next date of hearing, they shall make an alternative arrangement for conducting the matter. ) for the production and/or distribution of goods and service calculated to satisfy human wants and wishes (not spiritual or religious but inclusive of material things or services geared to celestial bliss), primafacie, there is an industry in the enterprise."
14. Yet in another paragraph, the observations are also worth to be taken note of, hence, reproduce hereinafter: "While applying the tests laid down in determining whether an activity falls, within "industry" it is necessary to remember that the Industrial Disputes Act, 1947 is a legislation intended to bring about peace and harmony between management and labour in an 'industry' so that production does not suffer and at the same time, labour is not exploited and discontented and, Page 21 of 62 Downloaded on : Sun Jun 14 04:15:30 IST 2020 C/SCA/19618/2019 JUDGMENT therefore, the tests must be so applied as to give the widest possible connotation to the term 'industry'. Whenever a question arises whether a particular concern is an "industry", the approach must be broad and liberal and not rigid or doctrinaire. The interpretation should be such as would advance the object and purpose of IDA, 1947 and give full meaning and effect to it in the achievement of its avowed social objective. Also as much as it is difficult to enumerated the possible attributes or features which make an undertaking analogous to trade or business, it would not be prudent to do so. So infinitely varied and manysided is human activity and with the incredible growth and progress in all branches of knowledge and ever widening areas of experience at all levels, it is becoming so diversified and expanding in so many directions hitherto unthought of, that no rigid and doctrinaire approach can be adopted in considering this question. The Court should, therefore, as far as possible avoid formulating or adopting generalisations and hesitate to cast the concept of industry in a narrow rigid mould which would not permit of expansion as and when necessity arises. Only some working principle may be evolved which would furnish guidance in determining what are the attributes or characteristics which would ordinarily indicate that an undertaking is analogous to trade or business. A workman can be regarded as one employed in an industry only if he is following one of the vocations mentioned in conjunction with his employers engaged in the vocations mentioned in relation to the employers. Thus, a basic requirement of 'industry' is that the employers must be carrying on any business, trade, undertaking, manufacture or calling of employers. If they are not, there is no industry as such.
Therefore, an activity can be regarded as an "industry" only if there is relationship of employer and employees and the former is engaged in 'business, trade, Page 22 of 62 Downloaded on : Sun Jun 14 04:15:30 IST 2020 C/SCA/19618/2019 JUDGMENT undertaking, manufacture or calling of employers' and the latter 'in any calling, service, employment, handicraft or industrial occupation or avocation'. Though 'undertaking' is a word of large import and it means anything undertaken or any project or enterprise, in the context in which it occurs, it must be read as meaning an undertaking analogous to trade or business, it must be "organised or arranged in a manner in which trade or business is generally organised or arranged". It must not be casual nor must it be for oneself nor for pleasure. And it must rest on cooperation between employer and employees who associate together with a view to production, sale or distribution of material goods or material services. It is entirely irrelevant whether or not there is profit motive or investment of capital in such activity. Even without these two features an activity can be an undertaking analogous to trade or business."
15. Even a Reference is also required to be made of one of the decisions delivered by Hon'ble Apex Court reported in AIR 1976 SC145, wherein in paragraph 11, the Hon'ble Apex Court has opined the circumstances to be taken into consideration to ascertain whether a particular establishment is coming within the purview of definition of industry. Para 11 of the said decision referred hereinafter: An activity can be regarded as an 'industry' within the meaning of Section 2(j) only if, there is relationship of employer and employees and the former is engaged in 'business, trade, undertaking, manufacture or calling of employers' and the later, 'in any calling, service, employment, handicraft or industrial occupation or avocation'. Though 'undertaking' is a word of large import and it means anything undertaken or any project or enterprise, in the context in which it occurs, it must be read as meaning an undertaking analogous to trade or business. In order that an activity may be regarded as an undertaking analogous to trade or business, it must be "organised or arranged in a manner in which trade or business is generally organised or arranged". It must not Page 23 of 62 Downloaded on : Sun Jun 14 04:15:30 IST 2020 C/SCA/19618/2019 JUDGMENT be casual nor must it be for oneself nor for pleasure. And it must rest on cooperation between employer and employees who associate together with a view to production, sale or distribution of material goods or material services. It is entirely irrelevant whether or not there is profit motive or investment of capital in such activity. It is also immaterial that its objects are charitable or that it does not make profits or even where profits are made, they are not distributed amongst the members, or that its activity is subsidised by the Government. Again it is not necessary that the employer must always be private individual. The Act, in terms, contemplates cases of industrial disputes where the Government or a local authority or a public utility service may be the employer. It also makes no difference that the material services rendered by the undertaking are in public interest, whether an activity is carried on in public interest or not can, therefore, never be a criterion for determining its character as an industry. Case law discussed."
16. Now, if we see the material led before the parties to the proceedings on the record of case on hand in aforesaid context, it is found that the petitioner establishment is satisfying some of the criteria laid down by the said decision of the Hon'ble Apex Court. The petitioner establishment is engaged in a systematic activity, it is also having on set up some of the employees as reflected from the staff list mentioned above and is also having some business out of the Shoe making. Initially, it was contended that only footwears belonging to and meant for Leprosy affected persons are being prepared and made out in the petitioner establishment, but the evidence on record has come to that extent that the petitioner set systematic activity viz., footwears are also being made out in the establishment and are also sold to some of the persons in the market and to controvert this the petitioner establishment has not led any evidence. Therefore, simply because the Page 24 of 62 Downloaded on : Sun Jun 14 04:15:30 IST 2020 C/SCA/19618/2019 JUDGMENT establishment missing an element of profit making, the same would not be permitted. The Court held that there is no contrary material produced to dislodge the finding arrived at by the learned Presiding Officer, the learned Presiding Officer has specifically held after examining the material on record and considering the ratio laid down by the decision of Hon'ble Apex Court (Supra) and then came to the conclusion, which is not called for any interference in exercise of jurisdiction under Article 226 and 227 of the Constitution of India. The parameters of exercise of such jurisdiction by this Court are not permitting in the background of this case to come to a different conclusion or to substitute the finding arrived at by the learned Presiding Officer, and therefore, since the petitioner establishment being an industry as defined under Section 2(j) of the Act is under an obligation to comply with statutory provisions contained under the Industrial Disputes Act.
He has also relied on the decision of the Apex Court rendered in case of Shalini Shyam Shetty and Another vs. Rajendra Shankar Patil; reported in 2010 8 SCC 329, where the Apex Court held thus:
"62. On an analysis of the aforesaid decisions of this Court, the following principles on the exercise of High Court's jurisdiction under Article 227 of the Constitution may be formulated:
(a) A petition under Article 226 of the Constitution is different from a petition under Article 227. The mode of Page 25 of 62 Downloaded on : Sun Jun 14 04:15:30 IST 2020 C/SCA/19618/2019 JUDGMENT exercise of power by High Court under these two Articles is also different.
(b) In any event, a petition under Article 227 cannot be called a writ petition. The history of the conferment of writ jurisdiction on High Courts is substantially different from the history of conferment of the power of Superintendence on the High Courts under Article 227 and have been discussed above.
(c) High Courts cannot, on the drop of a hat, in exercise of its power of superintendence under Article 227 of the Constitution, interfere with the orders of tribunals or Courts inferior to it. Nor can it, in exercise of this power, act as a Court of appeal over the orders of Court or tribunal subordinate to it. In cases where an alternative statutory mode of redressal has been provided, that would also operate as a restrain on the exercise of this power by the High Court.
(d) The parameters of interference by High Courts in exercise of its power of superintendence have been repeatedly laid down by this Court. In this regard the High Court must be guided by the principles laid down by the Constitution Bench of this Court in Waryam Singh (supra) and the principles in Waryam Singh (supra) have been repeatedly Page 26 of 62 Downloaded on : Sun Jun 14 04:15:30 IST 2020 C/SCA/19618/2019 JUDGMENT followed by subsequent Constitution Benches and various other decisions of this Court.
(e) According to the ratio in Waryam Singh (supra), followed in subsequent cases, the High Court in exercise of its jurisdiction of superintendence can interfere in order only to keep the tribunals and Courts subordinate to it, `within the bounds of their authority'.
(f) In order to ensure that law is followed by such tribunals and Courts by exercising jurisdiction which is vested in them and by not declining to exercise the jurisdiction which is vested in them.
(g) Apart from the situations pointed in (e) and (f), High Court can interfere in exercise of its power of superintendence when there has been a patent perversity in the orders of tribunals and Courts subordinate to it or where there has been a gross and manifest failure of justice or the basic principles of natural justice have been flouted.
(h) In exercise of its power of superintendence High Court cannot interfere to correct mere errors of law or fact or just because another view than the one taken by the tribunals or Courts subordinate to it, is a possible view. In other words the jurisdiction has to be very sparingly exercised.
(I) High Court's power of superintendence under Article 227 cannot be curtailed by any statute. It has been declared a Page 27 of 62 Downloaded on : Sun Jun 14 04:15:30 IST 2020 C/SCA/19618/2019 JUDGMENT part of the basic structure of the Constitution by the Constitution Bench of this Court in the case of L. Chandra Kumar vs. Union of India & others, reported in (1997) 3 SCC 261 and therefore abridgement by a Constitutional amendment is also very doubtful.
(j) It may be true that a statutory amendment of a rather cognate provision, like Section 115 of the Civil Procedure Code by the Civil Procedure Code (Amendment) Act, 1999 does not and cannot cut down the ambit of High Court's power under Article 227. At the same time, it must be remembered that such statutory amendment does not correspondingly expand the High Court's jurisdiction of superintendence under Article 227.
(k) The power is discretionary and has to be exercised on equitable principle. In an appropriate case, the power can be exercised suo motu.
(l) On a proper appreciation of the wide and unfettered power of the High Court under Article 227, it transpires that the main object of this Article is to keep strict administrative and judicial control by the High Court on the administration of justice within its territory.
(m) The object of superintendence, both administrative and judicial, is to maintain efficiency, smooth and orderly Page 28 of 62 Downloaded on : Sun Jun 14 04:15:30 IST 2020 C/SCA/19618/2019 JUDGMENT functioning of the entire machinery of justice in such a way as it does not bring it into any disrepute. The power of interference under this Article is to be kept to the minimum to ensure that the wheel of justice does not come to a halt and the fountain of justice remains pure and unpolluted in order to maintain public confidence in the functioning of the tribunals and Courts subordinate to High Court.
(n) This reserve and exceptional power of judicial intervention is not to be exercised just for grant of relief in individual cases but should be directed for promotion of public confidence in the administration of justice in the larger public interest whereas Article 226 is meant for protection of individual grievance. Therefore, the power under Article 227 may be unfettered but its exercise is subject to high degree of judicial discipline pointed out above.
(o) An improper and a frequent exercise of this power will be counterproductive and will divest this extraordinary power of its strength and vitality."
12. On thus hearing the learned advocates on both the sides and also considering at length all the decisions sought to rely upon, at the outset, the judgment and award of the Labour Court shall need to be regarded. In the statement of claim, Page 29 of 62 Downloaded on : Sun Jun 14 04:15:30 IST 2020 C/SCA/19618/2019 JUDGMENT respondent No.1 has stated that she worked in the first shift from 05:30 a.m. to 2'O clock (p.m.) for the past 25 years where she is needed to prepare the dough and roll out the "papads" and also make the packets which are being sold in various cities. She was being paid Rs.195/ as wages everyday and she has worked for more than 300 days every year. She has also been made permanent by the petitioner. There were in all 650 workmen working in Shri Mahila Griha Udyog Lijjat Papad, at village Golan, Taluka Valod, Surat. Before this Court, Mahila G.U.L.P. has approached through its president, Smt.Swatiben Paradakar, which is the main branch whereas before the Trial Court the petitioner is from Golan village, Taluka Valod, i.e. the Mahila Griha Udyog Lijjat Papad, Golan village (Taluka Valod). According to this petition, it had not been given any identity card, the benefit of provident fund, pay slip or any other benefit. To the respondent as would otherwise be available to the employee.
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13. The trial Court after permitting both the sides to adduce their respective evidence, noticed that the dough used to be supplied by the organization. The petitionerorganisation has been giving 5 kg of dough and if the papads were not properly rolled out, the organisation would cut the amount of the lady and again, the daily presence was also necessary, if the women associates remained absent, their wages used to be deducted. The deduction of the wages of nine workmen also had not been intimated. There were instances of insult and tracking them with impudence. She has also spoken of the complaint she had made for the behaviors hazard of sanchalika. Respondent had approached the Assistant Labour Commissioner on 26.12.2005. while she was once again permitted to work at his instance all of a sudden her form, pen, etc. had been taken away and she was threatened to withdraw her criminal case. She lodged a complaint on 28.12.2005 under Sections 3 and 10 Page 31 of 62 Downloaded on : Sun Jun 14 04:15:30 IST 2020 C/SCA/19618/2019 JUDGMENT of the Prevention of Atrocities Act, 1989, which has been registered at IIC.R.No.36 of 2005 & which was pending. She was once again taken back in the service. However, no work was being given to her. This has been questioned by her. Her termination having come without any notice or notice pay or retrenchment compensation, she made a serious grievance. All the averments raised before this Court have been raised before the Trial Court and the Court after availing the opportunities to the parties of adducing evidence raised the issues (i) as to whether the Court has jurisdiction to decide the disputes between the parties & relationship between the two of them whether could be established to be that of the employer and employer(workmen), (ii) whether the respondent was entitled to get the back wages from the petitioner and (iii) whether the reliefs sought for by the respondent to be given.
14. It can be noticed from the detailed discussion of oral as well as documentary Page 32 of 62 Downloaded on : Sun Jun 14 04:15:30 IST 2020 C/SCA/19618/2019 JUDGMENT evidences made by the Trial Court that it has taken into consideration the respective versions of the parties and also employed the ratio laid down in case of BANGALORE WATER SUPPLY & SEWERAGE BOARD (SUPRA) to hold that oral as well as documentary evidence clearly reflects that the petitioner has undertaken the work of production of the papad and other products which has been carried out as a systematic economic activity which involve the production of goods in service. This economic activity involves the work from the workmen in a systematic way and within a certain time frame. The Court having not found any evidence that the profit is distributed as claimed by the petitioner amongst the members applying the ratio laid down in BANGALORE WATER SUPPLY & SEWERAGE BOARD (SUPRA), the Court held it to be the economic activity of the petitioner organization and has held that the "charitable" employer works like a commercial minded employer and the relationship has been clearly established Page 33 of 62 Downloaded on : Sun Jun 14 04:15:30 IST 2020 C/SCA/19618/2019 JUDGMENT and therefore, has held that the relationship between the parties is that of the employer and the workmen.
15. The Court has also noticed that the evidence clearly establishes that every time the respondent would work for the petitioner, she was being provided the wages by the employer. She always was treated like any other workmen in any other industry. The Court was considering the Reference of the termination from the service from 25.12.2005 till she was taken back in the service till 05.02.2006. It appears that after the compromise, she was once again taken back in the service from 06.02.2006. Once again she was retrenched and a separate dispute had been raised in a Reference (LCS) No.45 of 2007 which was pending when this judgment and award impugned herein was pronounced on 06.07.2019.
16. Learned advocate, Mr.N.V.Gandhi has no instructions as to what had happened thereafter to the said Reference (LCS) No.45 of 2007 which Page 34 of 62 Downloaded on : Sun Jun 14 04:15:30 IST 2020 C/SCA/19618/2019 JUDGMENT was pending. It is also not in dispute that the respondent workman has not challenged this judgment for grant of the lumpsum compensation of Rs.25,000/. It could be possibly because there is another Reference pending challenging the act of the employer of terminating the services on the permanent basis.
17. At this stage, the definition of Section 2
(g) of 'Employer' and 2 (S) of 'Workman' require to be reproduced:
"2 (g): "employer" means (i) in relation to any industry carried on by or under the authority of any department of [the Central Government or a State Government,] the authority prescribed in this behalf, or where no authority is prescribed, the head of the department;
(ii) in relation to an industry carried on by or on behalf of a local authority, the chief executive officer of that authority;
"2 (s): "workman" means any person (including an apprentice) employed in any industry to do any manual, unskilled, skilled, technical, operational, clerical or supervisory work for hire or reward, whether the terms of Page 35 of 62 Downloaded on : Sun Jun 14 04:15:30 IST 2020 C/SCA/19618/2019 JUDGMENT employment be express or implied, and for the purposes of any proceeding under this Act in relation to an industrial dispute, includes any such person who has been dismissed, discharged or retrenched in connection with, or as a consequence of, that dispute, or whose dismissal, discharge or retrenchment has led to that dispute, but does not include any such person
(i) who is subject to the Air Force Act, 1950 (45 of 1950), or the Army Act, 1950 (46 of 1950), or the Navy Act, 1957 (62 of 1957); or
(ii) who is employed in the police service or as an officer or other employee of a prison or
(iii) who is employed mainly in a managerial or administrative capacity; or
(iv) who, being employed in a supervisory capacity, draws wages exceeding [ten thousand rupees] per mensem or exercises, either by the nature of the duties attached to the office or by reason of the powers vested in him, functions mainly of a managerial nature.] The provision of Section 2 (j) of the I.D.Act which defines the "Industry" also requires reproduction:Page 36 of 62 Downloaded on : Sun Jun 14 04:15:30 IST 2020
C/SCA/19618/2019 JUDGMENT "Industry" means any business, trade, undertaking, manufacture or calling of employers and includes any calling, service, employment, handicraft, or industrial occupation or avocation of workmen."
This has been referred to time and again in the decision of BANGALORE WATER SUPPLY & SEWERAGE BOARD (SUPRA), where the Apex Court had an occasion to consider whether a business run for production or supply goods in service can be termed as industry. The Court in clear terms held that the workers are not concerned about the destination of profit. They work and receive wages. While considering as to whether any organization even working for philanthropic activity or for charitable purpose is an industry or not, the Court needs to regard as to whether it is an economic activity which involves the cooperation of employer and employee and results in the productions of goods and service. The Court has held that materially difference between the commercial and the compassionate employers is Page 37 of 62 Downloaded on : Sun Jun 14 04:15:30 IST 2020 C/SCA/19618/2019 JUDGMENT not with reference to the workmen, but, with reference to the recipients of goods and services. Charity operates not visavis the workmen in which case they would be paid a liberal wage and generous extras with no prospect of strike. The Industrial Law would not take note of such extraneous factors, but, regulates industrial relations between employers and employees and workmen. Relevant finding and observation are reproduced as follow:
"111. It now remains to make a brief survey of the precedents on the point. One case which is germane to the issue is Bombay Pinjrapole(1). A Bench of this Court considered the earlier caselaw, including the decisions of the High Courts bearing on humane activities for the benefit of sick animals. Let there be no doubt that kindness to out dumb brethren, especially invalids, springs from the highest motives of fellow feeling. In the land of the Buddha and Gandhi no one dare argue to the contrary. So let there be no mistaking [1972] 1 S.C.R. 202 270 our compassionate attitude to suffering creatures. It is laudable and situations dedicated to amelioration of conditions of animals deserve Page 38 of 62 Downloaded on : Sun Jun 14 04:15:30 IST 2020 C/SCA/19618/2019 JUDGMENT encouragement from the State and affluent philanthropists. But these considerations have no bearing on the crucial factors which invoke the application of the definition in the Act as already set out elaborately by us. "The manner in which the activity in question is organised or arranged, the condition of the cooperation between the employer and the employee necessary for its success and its object to reader material service to the community" is a pivotal factor in the activityoriented test of an 'industry'. The compassionate motive and "he charitable inspiration are noble but extraneous. Indeed', medical relief for human beings made available free by regular hospitals, run by government or philanthropists, employing doctors and supportive staff and businesslike terms, may not qualify for exemption from industry. Service to animals cannot be on a higher footing than service to humans. Nor is it possible to contend that love of animals is religious or spiritual any more than love of humanbeings is. A pinjrapole is no church, mosque or temple. Therefore, without going into the dairying aspects, income and expenditure and other features of Bombay Pinjrapole, one may hold that the institution is an industry. After all, the employees are engaged, on ordinary economic terms and with conditions of service as in other business institutions and the activities also have organisational comparability to other profitmaking dairies or Page 39 of 62 Downloaded on : Sun Jun 14 04:15:30 IST 2020 C/SCA/19618/2019 JUDGMENT Pinjrapoles. What is different is the charitable object. What is. common is the nature of the employer employees relations. The conclusion, notwithstanding the humanitarian overtones, is that such organisations are also industries. Of course, in Bombay Pinjrapole the same conclusion was reached but on different and, to some extent faulty reasoning. For, the assumption in the judgment of Mitter J., is that if the income were mostly from donations and the treatment of animals were free, perhaps such charity, be it a hospital for humans or animals, may not be an industry. We agree with the holding, not because Pinjrapoles have commercial motives but because, despite compassionate objectives, they share businesslike orientation and operation. In this view, section 2(j) applies."
17. This Court notices that the identical question had come up for consideration with the very arguments which had been advanced before this Court and after detailed discussion of the provisions of law and various decisions on the subject as to what the industry means, the Court held that the wider import of the term 'industry' in light of the test laid down by the Apex Court and the facts established on the record, the Page 40 of 62 Downloaded on : Sun Jun 14 04:15:30 IST 2020 C/SCA/19618/2019 JUDGMENT activity being carried out by the petitioner for preparation of "papad" would get covered under the said definition. The activity being systematically organized by the cooperation between the petitioner and the respondent is infact between employer and employee. Though the respondents have been styled as members and the production of papads by the petitioner, which are prepared by the respondent and the said services are provided by the respondent calculated to satisfy the human wants and wishes and the said "papad" prepared and produced on a large scale basis. The fact remains that it is the production of papad and it is an activity of trade and business. Though intended to encourage the women with all noble objectives and developmental projects, the organization is definitely an industry and has been rightly held by the Labour Court to be so and such finding has not been interfered with.
18. The Court also examined another argument Page 41 of 62 Downloaded on : Sun Jun 14 04:15:30 IST 2020 C/SCA/19618/2019 JUDGMENT which has been advanced as to whether the respondent was the member of the petitioner society and therefore, cannot be called a workman under Section 2 (s) of the I.D.Act. It also has taken into consideration the decision of DHANGADHRA CHEMICAL WORKS VS. STATE OF SAURASHTRA and other decisions to hold that a person can be a workman even though he was paid not per day but by the job. In petitioner organization also, the respondents were initially paid everyday for the job done, but, later paid every fortnight on the basis of the "papads" rolled out by them. The evidence also had been adduced that about 500 to 600 women have been working at the petitioner centre and in the instant case, it is more than 600 women working at the centre, whereas in the entire country it is 43,000 women were working, who assembled to collect the dough and they deposit papad rolled on earlier date where the weight of the papad prepared by each women were recorded. The papads are also sorted out and those which are damaged and not prepared Page 42 of 62 Downloaded on : Sun Jun 14 04:15:30 IST 2020 C/SCA/19618/2019 JUDGMENT according to the specification are not accepted. Those papads are waste and the amount is deducted from the woman who rolled out the papad. This entire mechanism is concluded to be the mechanism worked out between the employers and their workmen.
".... The essential condition of a person being a workman within the terms of this definition is that he should be employed to do the work in that industry, that there should be in other words, an employment of his by the employer and that there should be the relationship between the employer and him as between the employer and employee or master and servant. Unless a person is thus employed, there can be no question of his being a workman within the definition of the term as contained in the Act."
"(14) The principle which emerges from these authorities is that the prima face test for the determination of the relationship between master and servant is the existence of the right in the master to supervise and control the work done by the servant not only in the matter of directing what work the servant is to do but also the manner in which he shall do his work, or to borrow the words of Lord Uthwatt at page 23 in Mersey Dock and Harbour Board v. Coggins & Giffith (Liverpool) Ltd.Page 43 of 62 Downloaded on : Sun Jun 14 04:15:30 IST 2020
C/SCA/19618/2019 JUDGMENT 1947 I AC 1 at p. 23 (E). The proper test is whether or not the hirer had authority to control the manner of execution of the act in question.
"(15) The nature or extent of control which is requisite to establish the relationship of employer and employee must necessarily vary from business to business and is by its very nature capable of precise definition. As has been noted above, recently pronouncement of the Court of Appeal in England have even expressed the view that it is not necessary for holding that a person is an employee, that the employer should be proved to have exercised control over his work, that the test of control was not one of universal application and that there were many contorts in which master could not control the manner in which the work was done (Vide observations of Somervelle, L. J. in Cassidy v. Ministry of Health (supra) and Denning L. J. in Stevenson, Jordan and Harrsison Ltd. v. Macdonald & Evans (B) (Supra)."
"(16). The correct method of approach, therefore, would be to consider whether having regard to the nature of the work there was due control and supervision by the employer or to use the words of Fletcher Moulton, L. J. at page 549 in Simmons v. Health laundry Co. 19101 KB 548 at PP. 549, 550. (F) : In my opinion it is impossible to lay down any rule of law distinguishing the one from the other. It is question of fact to be decided by all the Page 44 of 62 Downloaded on : Sun Jun 14 04:15:30 IST 2020 C/SCA/19618/2019 JUDGMENT circumstances of the case. the greater the amount of direct control exercised over the person rendering the services by the person contracting for them the stronger the grounds for holding it to be a contract of service, and similarly the greater the degree of independence of such control the greater the probability that the services rendered are of the nature of professional services and that the contract is not one of service".
"(25) Learned counsel for the appellants laid particular stress on two features in this cause which in his submission were consistent only with the position that the agarias are independent contractors. One is that they do piecework and the other that they employer their own labour and pay for it. In our opinion neither of these two circumstances if decisive of the question. As regards the first, the argument of the appellants is that as the agarias are under no obligation to work for fixed hours of days and are to be paid wages not per day or hours but for the quantity of salt actually produced and passed at a certain rate, the very basis on which the relationship of employer and employees rests is lacking and that they can only be regarded as independent contractors. There is, however, abundant authority in England that a person can be a workman even though he is paid not per day but by the hob. The following observations of Crompton, J in Sadler v. Henlack 1855 (4) El & B 1570 Page 45 of 62 Downloaded on : Sun Jun 14 04:15:30 IST 2020 C/SCA/19618/2019 JUDGMENT at p. 578 : 119 : ER 209 at p. 212 (I) are pertinent in this behalf.
The workman must have consented to give his personal services and not merely to get the work done, but if he is bound under his contract to work personally, he is not excluded from the definition, simply because he has assistance from others, who work under him...........".
"(28). There are no doubt considerable difficulties that may arise if the agarias were held to be workmen within the meaning of S. 2(s) of the Act. Rules regarding hour of work etc. applicable to other workmen may not be conveniently applied to them and the nature as well as the manner and method of their work would be such as cannot be regulated by any directions given by the Industrial Tribunal. These difficulties, however, are not deterrent against holding the agarias to be workmen within the meaning of the definition if they fulfil its requirements. The Industrial Tribunal would have to very well consider heat relief, if any may possibly be granted to them having regard to all the circumstances of the case and may not be able to regulate the work to be done by the agarias and the remuneration to be paid to them by the employer in the manner it is used to do in the case of other industries where the conditions of employment and the work to be done by the employees is Page 46 of 62 Downloaded on : Sun Jun 14 04:15:30 IST 2020 C/SCA/19618/2019 JUDGMENT of a different character. These considerations would necessarily have to be borne in mind while the Industrial Tribunal is adjudicating upon the dispute which have been referred to it for adjudication. They do not, however, militate against the conclusion which we have come to above that the decision of the Industrial Tribunal to the effect that agarias are workmen within the definition of the term contained in S. 2(s) of the Act was justified on the materials on the record".
19. At this stage, it would be profitable to reproduce relevant findings and observations of the Apex Court rendered in case of BANGALORE WATER SUPPLY & SEWERAGE BOARD (SUPRA).
"143. The dominant nature test :
(a)Where a complex of activities, some of which qualify for exemption, others not, involves employees on the total undertaking, some of whom Are not 'workmen' as in the University of Delhi case or some departments are not 'productive of goods and services if isolated, even then, the predominant nature of the services and the integrated nature of the departments as explained in the Corporation of Nagpur, will be the true test. The whole undertaking will be 'industry' although those who are not 'workmen' by definition may not benefit by the status.Page 47 of 62 Downloaded on : Sun Jun 14 04:15:30 IST 2020
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(b)Notwithstanding the previous clauses, sovereign
functions, strictly understood, (alone), qualify for
exemption, not the welfare activities of economic adventures undertaken by Government or statutory bodies.
(c)Even in departments discharging sovereign functions if there are units which are industries and they are substantially severable, then they can be considered to come within sec. 2(j).
(d)Constitutionally and competently enacted legislative provisions may well remove from the scope of the Act categories which otherwise may be covered thereby.
144. We overrule Safdarjung, Solicitors' case, Gymkhana, Delhi University, Dhanrajgirji Hospital and other rulings whose ratio runs counter to the principles enunciated above, and Hospital Mazdoor Sabha is hereby rehabilitated.
145. We conclude with diffidence because Parliament which has the commitment to the political nation to legislate promptly in vital areas like industry and trade and articulate the welfare expectations in the conscience' portion of the constitution, has hardly intervened to restructure the rather clumsy, vaporous and tallauddwarf definition or tidy up the scheme although Judicial thesis and antithesis, disclosed in the two decades long decisions, should have Page 48 of 62 Downloaded on : Sun Jun 14 04:15:30 IST 2020 C/SCA/19618/2019 JUDGMENT produced a legislative 284 synthesis becoming of a welfare State and Socialistic Society, in a world setting where I.L.O. norms are advancing and India needs updating. We feel confident, in another sense, since counsel stated at the bar that a bill on the subject is in the offing. The rule of law, we are sure, will run with the rule of LifeIndian Lifeat the threshold of the decade of new development in which Labour and Manage ment, guided by the State, will constructively partner the better production and fair diffusion of national wealth. We have stated that, save the Bangalore Water Supply and Sewerage Boardappeal, we are not disposing of the others on the merits. We dismiss that appeal with costs and direct that all the others be posted before a smaller bench for disposal on the merits in accordance with the principles of Law herein laid down.
146. BEG, C.J. I am in general agreement with the line of thinking adopted and the conclusions reached by my learned brother Krishna lyer. I would, however, like to add my reasons for this agreement and to indicate my approach to a problem where relevant legislation leaves so much for determination by the Court as to enable us to perform a function very akin to legislation.
147. My learned brother has relied on what was considered in England a somewhat unorthodox method of construction in Seaford Court Estates Ltd. v. Asher(1), where Lord Page 49 of 62 Downloaded on : Sun Jun 14 04:15:30 IST 2020 C/SCA/19618/2019 JUDGMENT Denning, L.J., said :
"When a defect appears a judge cannot simply fold his hands and blame the draftsman. He must set to work on the constructive task of finding the intention of Parliament and then he must supplement the written words so as to give 'force and life' to the intention of legislature. A judge should ask himself the question how, if the makers of the Act had themselves come across this ruck in the texture of it, they would have straightened it out? He must then do as they would have done. A judge must not alter the material of which the Act is woven, but he can and should iron out the creases".
When this case went up to the House of Lords it appears that the Law Lords disapproved of the bold effort of Lord Denning to make ambiguous legislation more comprehensible. Lord Simonds found it to be "a naked usurpation of the legislative function under the thin disguise of interpretation'. Lord Morton (with whom Lord Goddard entirely agreed) observed : "These heroics are out of place" and Lord Tucker, said "Your Lordships would be acting in a legislative rather than a judicial capacity if the view put forward by Denning, L.J., were to prevail"
148. Perhaps, with the passage of time, what may be described as the extension of a method resembling the "arm chair rule" in the construction of wills, judges can more frankly step into the shoes of the legislature where an enactment leaves its own intentions in much too nebulous or uncertain a state. In M. Pentiah v. Verramallappa(1), Sarkar, J. approved of the reasoning, set out above, adopted Page 50 of 62 Downloaded on : Sun Jun 14 04:15:30 IST 2020 C/SCA/19618/2019 JUDGMENT by Lord Denning. And, I must say that, in a case where the definition of "industry" is left in the state in which we find it, the situation perhaps calls for some judicial heroics to cope with the difficulties raised.
149. In his heroic efforts, my learned brother Krishna Iyer, if I may say so with great respect, has not discarded the tests of industry formulated in the past. Indeed, he has actually restored the tests laid down by this Court in D. N. Banerji's case(2), and, after that, in the Corporation of the City of Nagpur v. Its Employees(3), and State of Bombay & Ors. v. The Hospital Mazdoor Sabha & (OrS.) (4), to their pristine glory. My learned brother has, however, rejected what may appear, to use the word employed recently by an American Jurist, "excrescences" of subjective notions of judges which may have blurred those tests. The temptation is great, in such cases, for us to give expression of what may be purely subjective personal predilections. It has, however, to be resisted if law is to possess a direction in Conformity with Constitutional objectives and criteria which must impart that reasonable state of predictability and certainty to interpretations of the Constitution as well as to the laws made under it which citizens should expect. We have, so to speak, to chart what may appear to be a Sea in which the ship of law like Noah's ark may have to be navigated. Indeed, Lord Sankey on one occasion, said that law itself is like the ark to which people look for some certainty and Page 51 of 62 Downloaded on : Sun Jun 14 04:15:30 IST 2020 C/SCA/19618/2019 JUDGMENT security amidst the shifting sands of political life and vicissitudes of times. The Constitution and the directive principles of State policy, read with the basic fundamental rights, provide us with a compass. This Court has tried to indicate in recent cases that the meaning of what could be described as a basic "structure" of the Constitution must necessarily be found in express provisions of the construction and not merely in subjective notions about meanings of words. Similar must be the reasoning we must employ in extracting the core of meaning hidden between the interstices of statutory provisions.
150. Each of us is likely to have a subjective notion about "industry". For objectivity, we have to look first to the, words used in the statutory provision defining industry in an attempt to find the meaning. If that meaning is clear, we need proceed no further. But, the trouble here is that the words found there do not yield a meaning so readily. They refer to what employers or workers may do as parts of their ordinary avocation or business in life. When we turn to the meaning given of the term "worker" in Sec. 2(s) of the Act, we are once more driven back to find it in the bosom of "industry", for the term "worker" is defined as one :
"employed in any industry to do any skilled or unskilled manual, supervisory, technical or clerical work for hire or reward, whether the terms of employment be express or implied,, and for the purposes of any proceeding under this Page 52 of 62 Downloaded on : Sun Jun 14 04:15:30 IST 2020 C/SCA/19618/2019 JUDGMENT Act in relation to an industrial dispute, includes any such person who has been dismissed, discharged or retrenched in connection with, or as a consequence of that dispute. or whose dismissal, discharge or retrenchment has led to that dispute".
The definition, however, excludes specifically those who are subject to the Army Act 1950 or the Air Force Act 1950, or the Navy Discipline Act 1934, as well as those who are employed in the Police Service or Officers and other employees of a Prison, or employed in mainly managerial or administrative capacities or who, being employed in supervisory capacity, draw wages exceeding Rs. 500/ per mensem.
151. Thus, in order to draw the "circle of industry", to use the expression of my learned brother Iyer, we do not find even the term "workman" illuminating. The definition only enables us to see that certain classes of persons employed in the service of the State are excluded from the purview of industrial dispute which the Act seeks to provide for in the interests of industrial peace and harmony between the employers and employees so that the welfare of the nation is secured. The result is that we have then to turn to the preamble to find the object of the Act itself, to the legislative history of the Act, and to the socioeconomic ethos and aspirations and needs of the times in which the Act was passed.
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152. The method which has been followed, whether it be called interpretation or construction of a part of an organic whole in which the statute, its objectives, its past and its direction for the future, its constitutional setting are all parts of this whole with their correlated functions. Perhaps it is impossible, in adopting such a method of interpretation, which some may still consider unorthodox, a certain 217 degree of subjectivity. But our attempt should be not to break with the wellestablished principles of interpretation in doing so. Progressive rational and beneficial modes of interpretation import and fit into the body of the old what may be new.It is a process of adaptation for giving new vitality in keeping with the progress of thought in our times. All this, however, is not really novel, although we may try to say it in a new way.
153. If one keeps in mind what was laid down in Heydon's case (supra) referred to by my learned brother Iyer, the well known principle that a statute must be interpreted as a whole, in the context of all the provisions of the statute, its objects, the preamble, and the functions of various provisions, the true meaning may emerge. It may not be strictly adictionary meaning in such cases. Indeed, even in a modern statute the meaning of a term such as "Industry" may change with a rapidly changed social and economic structure. For this proposition I can do no better Page 54 of 62 Downloaded on : Sun Jun 14 04:15:30 IST 2020 C/SCA/19618/2019 JUDGMENT than to quote Subba Rao J. speaking for this Court in The Senior Electric Inspector v. Laxmi Narayan Chopra.
"The legal position may be summarized thus : The maxim contemporanea expositio as laid down by Coke was applied to construing ancient statutes but not to interpreting Acts which are comparatively modern. There is a good reason for this change in the mode of interpretation. The fundamental rule of construction is the same whether the Court is asked to construe a provision of an ancient statute or that of a modem one, namely, what is the expressed intention of the Legislature. It is perhaps difficult to attribute to a legislative body functioning in a static society that its intention was couched in terms of considerable breadth so as to take within its sweep the future developments comprehended by the phraseology used.. It is more reasonable to confine its intention only to the circumstances obtaining at the time the law was made. But in a modern progressive society it would be unreasonable to confine the intention of a Legislature to the meaning attributable to the word used at the time the law was made, for a modern Legislature making laws to govern a society which is fast moving must be presumed to be aware of an enlarged meaning the same concept might attract with the march of time and with the revolutionary changes brought about in social, economic, political and scientific and other fields of human activity. Indeed, unless a contrary intention Page 55 of 62 Downloaded on : Sun Jun 14 04:15:30 IST 2020 C/SCA/19618/2019 JUDGMENT appears, an interpretation should be given to the words used to take in new facts and situations, if the words are capable of comprehending them."
154. In the Workmen of Dimakuchi Tea Estate v. The Management of Dimakuchi Tea Estate it was observed :
218 "A little careful consideration will show, however, that the expression "any person". occurring in the third part of, the definition clause cannot mean anybody and everybody in this wide world. First of all the subject matter of dispute must relate to (i) employment or nonemployment or (ii) terms of employment or conditions of labour of any person;
these necessarily import it limitation in the sense that a person in respect of whom the employeremployee relation never existed or can never possibly exist cannot be the subject matter of a dispute between employers and workmen. Secondly, the definition clause must be read in the context of the subject matter and scheme of the Act, and consistently with the objects and other provisions of the Act. It is well settled that "the words of a statute, when there is a doubt about their meaning are to be understood in the sense in which they best harmonise with the subject of the enactment and the object which the Legislature has in view. Their meaning is found not so much in strictly grammatical or etymological propriety of language, nor even in its popular use, as in the subject or in the occasion on which they are used,, and the object to be attained." (Maxwell, Page 56 of 62 Downloaded on : Sun Jun 14 04:15:30 IST 2020 C/SCA/19618/2019 JUDGMENT Inter pretation of Statutes, , 9th Edition, p. 55) It was also said there:
"It is necessary, therefore, to take the Act as a whole and examine its salient provisions. The long title shows that the object of the Act is "to make provision for the investigation and settlement of industrial disputes, and for certain other purposes." The preamble states the same object and s. 2 of the Act which contains definitions states that unless there is anything repugnant in the subject or context, certain expressions will have certain meanings."
Thus, it is in the context of the purpose of the Act that the meaning of the term 'industry' was sought.
155. Again dealing with the objects of the Act before us in Budge Municipality case(1) this Court said :
"When our Act came to be passed, labour disputes had already assumed big proportions and there were clashes between workmen and employers in several instances. We can assume that it was to meet such a situation that the Act was enacted, and it is consequently necessary to give the terms employed in the Act referring to such disputes as wide an import as reasonably possible." In that very case this Court also said :Page 57 of 62 Downloaded on : Sun Jun 14 04:15:30 IST 2020
C/SCA/19618/2019 JUDGMENT "There is nothing, however, to prevent a statute from giving the word "industry" and the words "industrial dispute" a wider and more comprehensive import in order to meet the requirements of rapid industrial progress and to bring about in the interests of industrial peace and economy, a fair and satisfactory adjustment of relations between employers and workmen in a variety of fields of activity. It is obvious that the limited concept of what an industry meant in early times must now yield place to an enormously wider concept so as to take in various and varied forms of industry, so that disputes arising in connection with them might be settled quickly without much dislocation and disorganisation of the needs of the society and in a manner more adapted to conciliation and settlement than a determination of the respective rights and liabilities according to strict legal procedure and principles."
156. Again, in Hospital Mazdoor Sabha case(1) this Court said:
"If the object and scope of the statute are considered there would be no difficulty in holding that the relevant words of wide import have been deliberately used by the Legislature in defining "industry" in Sec. 2(j). The object of the Act was to make provision for the investigation and settlement of industrial disputes, and the extent and scope of the provisions would be realised if we bear in mind the definition of "industrial disputes" given by Section 2(k), of Page 58 of 62 Downloaded on : Sun Jun 14 04:15:30 IST 2020 C/SCA/19618/2019 JUDGMENT "wages" by Section 2(rr), "workmen" by Section 2(s), and of "employer" by Section 2(g)."
It added :
"It is obvious that the words used in an inclusive definition denote extension and cannot be treated as restricted in any sense
157. I may here set out the definition given by the Act of the term 'industry' in section 2, sub. s. (j) "(j) "Industry" means any business, trade, undertaking, manufacture or calling of employers and includes any calling, service, employment, handicraft, or industrial occupation or avocation of workmen;"
158. It seems to me that the definition was not meant to provide more than a guide. It raises doubts as to what could be meant by the "calling of employers" even if business, trade, undertaking or manufacture could be found capable of being more clearly delineated. It is clear that there is no mention here of any profit motive. Obviously, the word "Manufacture" of employers could not be interpreted liter al1y. It merely means a process of manufacture in which the employers may be engaged. It is, however, evident that the term 'employer' necessarily postulates employees without whom there can be no employers. But, the second part of the definition makes " the concept more nebulous as it, Page 59 of 62 Downloaded on : Sun Jun 14 04:15:30 IST 2020 C/SCA/19618/2019 JUDGMENT obviously, extends the definition to any calling, service, employment, handicraft or industrial occupation or avocation of workmen". I have already examined the meaning of the term " workman" which refers us back to what is an "industry". it seems to me that the second part, relating to workmen, must necessarily indicate something which may exclude employers and include an "industry It consisting of individual handicraftsmen or workmen only. At any rate, the meaning of industrial disputes includes disputes between workmen and workmen also. Therefore, I cannot see how we can cut down the wide ambit of last part of the definition by searching for the predominant meaning in the first part unless we were determined, at the outset, to curtail the scope of the second part somehow. If we do that, we will be deliberately cutting down the real sweep of the last part. Neither "Noscitur a sociis" rule nor the " ejusdem generis" rule are adequate for such a case.
159. There is wisdom in the suggestion that in view of these difficulties in finding the meaning of the term 'industry', as defined in the Act, it is best to say that an industry cannot strictly be defined but can only be described. But, laying down such a rule may again leave too wide a door open for speculation and subjective notions as to what is describable as an industry. It is, perhaps, better to look for a rough rule of guidance in such a case by Page 60 of 62 Downloaded on : Sun Jun 14 04:15:30 IST 2020 C/SCA/19618/2019 JUDGMENT considering what the concept of 'industry' must exclude."
20. Going by the dominant nature test made applicable in BANGALORE WATER SUPPLY & SEWERAGE BOARD (SUPRA) it can be said that wide ambit of the definition of industry will surely cover the activities of the petitioner institute. As held by the Apex Court the industry cannot be strictly defined, but, can only be described. The Court has also gone to an extent that the service are rendered by groups of charitable individuals to themselves or others out of missionary zeal and purely charitable motives, there would hardly be any need to invokethe provisions of the industrial Disputes Act to protect them. It is the nature of the activity determined by the conditions which give rise to the likelihood of occurrence of such disputes and their actual occurrence in the sphere.
21. Here is not the type of the activities which can be termed as other than the industry.
Activities since essentially covered by the Page 61 of 62 Downloaded on : Sun Jun 14 04:15:30 IST 2020 C/SCA/19618/2019 JUDGMENT
detailed guidelines and the ratio laid down in the said decision, this Court is of the opinion that the decision of the Labour Court require no interference.
22. Let the judgment and award be implemented in its letter and spirit. The payment be made within a period of two weeks from the date of receipt of a copy of this order.
23. Present petitions stand disposed of with the above direction and observations.
(MS SONIA GOKANI, J) M.M.MIRZA Page 62 of 62 Downloaded on : Sun Jun 14 04:15:30 IST 2020